Document:

a20211118mtdrex101forupl

Exhibit 10.1    Execution Version  84134605.9   MRC Energy Company Credit Agreement  FOURTH AMENDED AND RESTATED CREDIT AGREEMENT  Dated as of November 18, 2021    MRC ENERGY COMPANY,  as Borrower,    THE LENDING ENTITIES FROM TIME TO TIME PARTIES HERETO,  as Lenders,    and    ROYAL BANK OF CANADA,  as Administrative Agent    RBC CAPITAL MARKETS,   as Joint Lead Arranger and Joint Bookrunner,    and    TRUIST SECURITIES, INC.,  as Joint Lead Arranger and Joint Bookrunner,    and    TRUIST BANK,  as Syndication Agent,    and    BANK OF AMERICA, N.A.,  BANK OF NOVA SCOTIA, HOUSTON BRANCH, and  PNC BANK, NATIONAL ASSOCIATION,  as Joint Lead Arrangers, Joint Bookrunners and Co-Documentation Agents,    and    KEYBANC CAPITAL MARKETS INC.,  as Joint Lead Arranger      

 

  84134605.9   MRC Energy Company Credit Agreement i  ARTICLE 1. DEFINITIONS ................................................................................................. 1  1.1 Certain Defined Terms ........................................................................................... 1  1.2 Terms, Generally .................................................................................................. 37  1.3 Oil and Gas Definitions ....................................................................................... 38  1.4 Divisions .............................................................................................................. 38  ARTICLE 2. REVOLVING CREDIT ................................................................................. 38  2.1 Commitment ........................................................................................................ 38  2.2 Accrual of Interest and Maturity; Evidence of Indebtedness ............................... 38  2.3 Requests for Advances and for Continuations and Conversions of  Advances .............................................................................................................. 39  2.4 Disbursement of Advances .................................................................................. 41  2.5 [Intentionally Omitted] ........................................................................................ 42  2.6 Interest Payments; Default Interest ...................................................................... 42  2.7 Optional Prepayments .......................................................................................... 43  2.8 Base Rate Advance in Absence of Election or Upon Default ............................. 44  2.9 Commitment Fees ................................................................................................ 44  2.10 Mandatory Prepayment of Advances ................................................................... 44  2.11 Optional Reduction or Termination of Commitments ......................................... 46  2.12 Use of Proceeds of Advances .............................................................................. 46  ARTICLE 3. LETTERS OF CREDIT ................................................................................. 46  3.1 Letters of Credit ................................................................................................... 46  3.2 Conditions to Issuance ......................................................................................... 47  3.3 Notice ................................................................................................................... 48  3.4 Letter of Credit Fees; Increased Costs ................................................................. 48  3.5 Other Fees ............................................................................................................ 50  3.6 Participation Interests in and Drawings and Demands for Payment Under  Letters of Credit ................................................................................................... 50  3.7 Obligations Irrevocable and Absolute ................................................................. 52  3.8 Risk Under Letters of Credit ................................................................................ 53  3.9 Indemnification .................................................................................................... 54  3.10 Right of Reimbursement ...................................................................................... 55  ARTICLE 4. BORROWING BASE .................................................................................... 55  4.1 Borrowing Base ................................................................................................... 55  4.2 Periodic Determinations of Borrowing Base ....................................................... 56  4.3 Engineering Data to be Provided Prior to Scheduled Determination Dates ........ 56  4.4 Special Determinations of Borrowing Base ......................................................... 56  4.5 General Procedures With Respect to Determination of Borrowing Base ............ 56  4.6 Borrowing Base Deficiency ................................................................................. 57  ARTICLE 5. CONDITIONS ............................................................................................... 58  5.1 Conditions of Initial Advances ............................................................................ 58  5.2 Conditions to Each Advance and Letter of Credit ............................................... 61  

 

  84134605.9   MRC Energy Company Credit Agreement ii  ARTICLE 6. REPRESENTATIONS AND WARRANTIES .............................................. 61  6.1 Corporate Authority ............................................................................................. 61  6.2 Due Authorization ................................................................................................ 62  6.3 Good Title; Leases; Assets; No Liens .................................................................. 62  6.4 Taxes .................................................................................................................... 62  6.5 No Defaults .......................................................................................................... 63  6.6 Enforceability ....................................................................................................... 63  6.7 Compliance with Laws ........................................................................................ 63  6.8 Non-contravention ............................................................................................... 64  6.9 Litigation .............................................................................................................. 64  6.10 Consents, Approvals and Filings, etc ................................................................... 64  6.11 No Investment Company or Margin Stock .......................................................... 64  6.12 ERISA .................................................................................................................. 65  6.13 Conditions Affecting Business or Properties ....................................................... 65  6.14 Environmental and Safety Matters....................................................................... 65  6.15 Subsidiaries .......................................................................................................... 66  6.16 Capital Structure .................................................................................................. 66  6.17 Accuracy of Information ...................................................................................... 66  6.18 Solvency ............................................................................................................... 66  6.19 No Misrepresentation ........................................................................................... 67  6.20 Engineering Reports ............................................................................................. 67  6.21 Gas Balancing Agreements and Advance Payment Contracts ............................ 67  6.22 Commodity Hedging Agreements ....................................................................... 68  6.23 Corporate Documents and Corporate Existence .................................................. 68  ARTICLE 7. AFFIRMATIVE COVENANTS. .................................................................. 68  7.1 Financial Statements ............................................................................................ 68  7.2 Certificates; Other Information ............................................................................ 69  7.3 Payment of Obligations ........................................................................................ 71  7.4 Conduct of Business and Maintenance of Existence; Compliance with  Laws ..................................................................................................................... 71  7.5 Maintenance of Property; Insurance .................................................................... 71  7.6 Inspection of Property; Books and Records, Discussions ................................... 72  7.7 Notices ................................................................................................................. 73  7.8 Hazardous Material Laws .................................................................................... 73  7.9 Financial Covenants ............................................................................................. 74  7.10 Governmental and Other Approvals .................................................................... 74  7.11 Compliance with ERISA; ERISA Notices ........................................................... 74  7.12 Future Restricted Subsidiaries; Additional Collateral ......................................... 75  7.13 Use of Proceeds .................................................................................................... 75  7.14 Further Assurances and Information .................................................................... 75  7.15 Reserve Reports ................................................................................................... 76  7.16 Title Information and Mortgage Coverage .......................................................... 77  7.17 Collateral .............................................................................................................. 78  7.18 [Reserved] ............................................................................................................ 78  7.19 Consolidated Cash Balance Information ............................................................. 78  

 

  84134605.9   MRC Energy Company Credit Agreement iii  7.20 Post-Closing Covenant......................................................................................... 79  ARTICLE 8. NEGATIVE COVENANTS .......................................................................... 79  8.1 Limitation on Debt ............................................................................................... 79  8.2 Limitation on Liens .............................................................................................. 81  8.3 Fundamental Changes .......................................................................................... 81  8.4 Dispositions.......................................................................................................... 82  8.5 Restricted Payments ............................................................................................. 83  8.6 Limitation on Investments, Loans and Advances ................................................ 84  8.7 Transactions with Affiliates and Unrestricted Subsidiaries ................................. 85  8.8 Limitations on Other Restrictions ........................................................................ 85  8.9 Fiscal Year ........................................................................................................... 86  8.10 Gas Balancing Agreements and Advance Payment Contracts ............................ 86  8.11 Hedging Transactions .......................................................................................... 86  8.12 Nature of Business ............................................................................................... 87  8.13 Senior Notes Restrictions ..................................................................................... 87  ARTICLE 9. DEFAULTS ................................................................................................... 88  9.1 Events of Default ................................................................................................. 88  9.2 Exercise of Remedies ........................................................................................... 90  9.3 Rights Cumulative ............................................................................................... 91  9.4 Waiver by Borrower of Certain Laws .................................................................. 91  9.5 Waiver of Defaults ............................................................................................... 91  9.6 Set Off .................................................................................................................. 91  ARTICLE 10. PAYMENTS, RECOVERIES AND COLLECTIONS ................................. 92  10.1 Payment Procedure .............................................................................................. 92  10.2 Application of Proceeds of Collateral .................................................................. 93  10.3 Pro-rata Recovery ................................................................................................ 94  10.4 Treatment of a Defaulting Lender; Reallocation of Defaulting Lender’s  Fronting Exposure ................................................................................................ 94  ARTICLE 11. CHANGES IN LAW OR CIRCUMSTANCES; INCREASED COSTS ...... 95  11.1 Reimbursement of Prepayment Costs .................................................................. 95  11.2 Eurodollar Lending Office ................................................................................... 96  11.3 Circumstances Affecting LIBOR Rate Availability ............................................ 96  11.4 Laws Affecting LIBOR Rate Availability ........................................................... 99  11.5 Increased Cost of Advances Carried at the LIBOR Rate ..................................... 99  11.6 Capital Adequacy and Other Increased Costs .................................................... 100  11.7 Right of Lenders to Fund through Branches and Affiliates ............................... 101  11.8 Margin Adjustment ............................................................................................ 101  11.9 Taxes .................................................................................................................. 102  ARTICLE 12. AGENT ........................................................................................................ 105  12.1 Appointment of Administrative Agent .............................................................. 105  12.2 Deposit Account with Administrative Agent or any Lender ............................. 106  12.3 Scope of Administrative Agent’s Duties ........................................................... 106  

 

  84134605.9   MRC Energy Company Credit Agreement iv  12.4 Successor Administrative Agent ........................................................................ 106  12.5 Credit Decisions ................................................................................................. 107  12.6 Authority of Administrative Agent to Enforce This Agreement ....................... 107  12.7 Indemnification of Administrative Agent .......................................................... 108  12.8 Knowledge of Default ........................................................................................ 108  12.9 Administrative Agent’s Authorization; Action by Lenders ............................... 109  12.10 Enforcement Actions by Administrative Agent ................................................. 109  12.11 Collateral Matters ............................................................................................... 109  12.12 Administrative Agent in its Individual Capacity ............................................... 109  12.13 Administrative Agent’s Fees.............................................................................. 109  12.14 Documentation Administrative Agent or other Titles ....................................... 110  12.15 No Reliance on Administrative Agent’s Customer Identification Program ...... 110  12.16 Certain Payments ............................................................................................... 110  ARTICLE 13. MISCELLANEOUS .................................................................................... 111  13.1 Accounting Principles ........................................................................................ 111  13.2 Consent to Jurisdiction ....................................................................................... 111  13.3 Law of Texas...................................................................................................... 112  13.4 Interest................................................................................................................ 112  13.5 Closing Costs and Other Costs; Indemnification ............................................... 113  13.6 Notices ............................................................................................................... 115  13.7 Successors and Assigns; Participations; Assignments ....................................... 116  13.8 Counterparts ....................................................................................................... 120  13.9 Amendment and Waiver .................................................................................... 121  13.10 Confidentiality ................................................................................................... 123  13.11 Substitution or Removal of Lenders .................................................................. 124  13.12 WAIVER OF JURY TRIAL .............................................................................. 126  13.13 USA Patriot Act Notice ..................................................................................... 126  13.14 Complete Agreement; Conflicts ........................................................................ 126  13.15 Severability ........................................................................................................ 126  13.16 Table of Contents and Headings; Section References ....................................... 127  13.17 Electronic Transmissions ................................................................................... 127  13.18 Reliance on and Survival of Provisions ............................................................. 127  13.19 Concerning Lender Hedging Obligations and Lender Product Obligations ...... 128  13.20 Release of Guarantees and Liens ....................................................................... 128  13.21 Existing Credit Agreement ................................................................................ 129  13.22 Reallocation of Commitments and Revolving Credit Advances ....................... 130  13.23 Flood Insurance .................................................................................................. 130  13.24 Acknowledgment and Consent to Bail-In of Affected Financial Institutions .... 130  13.25 Acknowledgment Regarding Any Supported QFCs .......................................... 131  13.26 Entire Agreement ............................................................................................... 132    

 

  84134605.9   MRC Energy Company Credit Agreement v  EXHIBITS  A Form of Request for Revolving Credit Advance  B Form of Revolving Credit Note  C Form of Assignment and Assumption  D Form of Guaranty  E Form of Compliance Certificate  F Form of Notice of Request for Letter of Credit  G Form of Notice of Prepayment  H-1 Form of U.S. Tax Compliance Certificate (for Foreign Lenders That Are Not   Partnerships)  H-2 Form of U.S. Tax Compliance Certificate (for Foreign Participants That Are Not   Partnerships)  H-3 Form of U.S. Tax Compliance Certificate (for Foreign Participants That Are   Partnerships)  H-4 Form of U.S. Tax Compliance Certificate (for Foreign Lenders That Are   Partnerships)  I Form of Consolidated Cash Balance Certificate    SCHEDULES  1.1 Applicable Margin Grid  1.2 Percentages and Allocations  1.4 Existing Letters of Credit  1.5 Existing Mortgages   5.1(b)(iii) Qualification Jurisdictions  6.3 Good Title; Leases; Assets; No Liens  6.9 Litigation  6.12 ERISA  6.14 Environmental and Safety Matters  6.15 Subsidiaries  6.16 Capital Structure  6.21 Gas Balancing Agreements and Advance Payment Contracts  6.22(a) Commodity Hedging Agreements  6.22(b) Withdrawing Lenders  6.22(c) Withdrawing Lender Commodity Hedging Agreements  6.23 Compliance Information  8.1 Existing Debt  8.2 Existing Liens  8.6 Existing Investments  8.7 Transactions with Affiliates  13.6 Notices    

 

  84134605.9   MRC Energy Company Credit Agreement   FOURTH AMENDED AND RESTATED CREDIT AGREEMENT  This Fourth Amended and Restated Credit Agreement (this “Agreement”) is made as of  November 18, 2021, by and among the lending entities from time to time party hereto (individually  a “Lender,” and collectively “Lenders”), Royal Bank of Canada, as administrative agent for the  Lenders (in such capacity, “Administrative Agent”), and MRC Energy Company, a Texas  corporation (“Borrower”).  RECITALS  A. Borrower entered into that certain Third Amended and Restated Credit Agreement,  dated as of September 28, 2012 (as amended, restated, amended and restated, extended,  supplemented or otherwise modified in writing from time to time prior to the date hereof, the  “Existing Credit Agreement”), among Borrower, the lenders from time to time party thereto, and  Administrative Agent.  B. Borrower has requested that Administrative Agent and the Lenders amend and  restate the Existing Credit Agreement and provide certain loans to and extensions of credit on  behalf of Borrower, and Administrative Agent and the Lenders have agreed to amend and restate  the Existing Credit Agreement and make such loans and extensions of credit subject to the terms  and conditions of this Agreement.  C. This Agreement is an amendment and restatement of, and is made in extension and  renewal, and not in extinguishment or novation, of the outstanding indebtedness under the Existing  Credit Agreement, it being acknowledged and agreed by Borrower that the Indebtedness under  this Agreement constitutes an extension, renewal, increase and ratification of the outstanding  indebtedness under the Existing Credit Agreement.   NOW THEREFORE, in consideration of the covenants contained herein, Borrower,  Lenders, and Administrative Agent agree as follows:  ARTICLE 1. DEFINITIONS.  1.1 Certain Defined Terms.  For the purposes of this Agreement, the following terms  will have the following meanings:  “Administrative Agent” has the meaning set forth in the preamble, and includes any  Successor Administrative Agent appointed in accordance with Section 12.4.  “Administrative Questionnaire” means an Administrative Questionnaire in a form supplied  by the Administrative Agent.  “Advance” means a Revolving Credit Advance.  “Advance Payment Contract” means any contract whereby any Credit Party either  (a) receives or becomes entitled to receive (either directly or indirectly) any payment (an “Advance  Payment”) to be applied toward payment of the purchase price of Hydrocarbons produced or to be  produced from Oil and Gas Properties owned by any Credit Party and which Advance Payment is  

 

  84134605.9   MRC Energy Company Credit Agreement 2  paid or to be paid in advance of actual delivery of such production to or for the account of the  purchaser regardless of such production, or (b) grants an option or right of refusal to the purchaser  to take delivery of such production in lieu of payment, and, in either of the foregoing instances,  the Advance Payment is, or is to be, applied as payment in full for such production when sold and  delivered or is, or is to be, applied as payment for a portion only of the purchase price thereof or  of a percentage or share of such production; provided that inclusion of the standard “take or pay”  provision in any gas sales or purchase contract or any other similar contract shall not, in and of  itself, constitute such contract as an Advance Payment Contract for the purposes hereof.  “Affected Financial Institution” means (a) any EEA Financial Institution or (b) any UK  Financial Institution.  “Affected Lender” shall have the meaning set forth in Section 13.11(a).  “Affiliate” means, as to any Person, any other Person which, directly or indirectly, is in  control of, is controlled by, or is under common control with, such Person.  For purposes of this  definition, “control” of a Person means the power, directly or indirectly, either to (a) vote 30% or  more of the securities having ordinary voting power for the election of directors of such Person or  (b) direct or cause the direction of the management and policies of such Person, whether by  contract or otherwise.  “Aggregate Credit Exposure” means, as of any date of determination, the sum of the Credit  Exposure of all of the Lenders as of such date.  “Applicable Fee Percentage” means, as of any date of determination thereof, the applicable  percentage used to calculate certain of the fees due and payable hereunder, determined by reference  to the appropriate columns in the Applicable Margin Grid, such Applicable Fee Percentage to be  adjusted solely as specified in Section 11.8.  “Applicable Interest Rate” means, with respect to each Revolving Credit Advance, the  Eurodollar-based Rate or the Base Rate, as selected by Borrower from time to time subject to the  terms and conditions of this Agreement.  “Applicable Margin” means, as of any date of determination thereof, the applicable interest  rate margin, determined by reference to the appropriate columns in the Applicable Margin Grid,  such Applicable Margin to be adjusted solely as specified in Section 11.8.  “Applicable Margin Grid” means that certain pricing grid attached to this Agreement as  Schedule 1.1.  “Applicable Payment” has the meaning set forth in Section 12.16(a).  “Approved Counterparty” means, at any time and from time to time, (a) any Lender  Counterparty or (b) any Person engaged in the business of writing Commodity Hedging  Agreements or Interest Rate Agreements that has (or the credit support provider of such Person  has), at the time Borrower or any Restricted Subsidiary enters into a Commodity Hedging  Agreement or Interest Rate Agreement, as applicable, with such Person, a long term senior  unsecured debt credit rating of BBB-/Baa3 by S&P or Moody’s (or their equivalent) or higher.  

 

  84134605.9   MRC Energy Company Credit Agreement 3  “ASC Topic 815” means the Accounting Standards Codification No. 815 (Derivatives and  Hedging), as issued by the Financial Accounting Standards Board.  “Assignment and Assumption” means an assignment and assumption entered into by a  Lender and an Eligible Assignee (with the consent of any party whose consent is required by  Section 13.7(b)), and accepted by the Administrative Agent, in substantially the form of Exhibit C  or any other form approved by the Administrative Agent.  “Available Tenor” means, as of any date of determination and with respect to the then- current Benchmark, as applicable, any tenor for such Benchmark or payment period for interest  calculated with reference to such Benchmark, as applicable, that is or may be used for determining  the length of an Interest Period pursuant to this Agreement as of such date and not including, for  the avoidance of doubt, any tenor for such Benchmark that is then-removed from the definition of  “Interest Period” or “Eurodollar-Interest Period” pursuant to Section 11.3(d).  “Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the  applicable Resolution Authority in respect of any liability of an Affected Financial Institution.  “Bail-In Legislation” means (a) with respect to any EEA Member Country implementing  Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European  Union, the implementing law, regulation rule or requirement for such EEA Member Country from  time to time which is described in the EU Bail-In Legislation Schedule and (b) with respect to the  United Kingdom,  Part I of the United Kingdom Banking Act 2009 (as amended from time to time)  and any other law, regulation or rule applicable in the United Kingdom relating to the resolution  of unsound or failing banks, investment firms or other financial institutions or their affiliates (other  than through liquidation, administration or other insolvency proceedings).  “Bankruptcy Code” means Title 11 of the United States Code and the rules promulgated  thereunder.  “Base Rate” means for any day, that rate of interest which is equal to the sum of the  Applicable Margin plus the greatest of (a) the Prime Rate for such day, (b) the Federal Funds  Effective Rate in effect on such day, plus 1⁄2 of one percent (0.5%) and (c) the Daily Adjusting  LIBOR Rate plus one percent (1.0%); provided, however, for purposes of determining the Base  Rate during any period that the LIBOR Rate is unavailable as determined under Sections 11.3 or  11.4, the Base Rate shall be determined using, for clause (c) hereof, the Daily Adjusting LIBOR  Rate in effect on the Business Day immediately prior to the LIBOR Rate becoming unavailable  pursuant to Sections 11.3 or 11.4.  “Base Rate Advances” means Advances the rate of interest applicable to which is based  upon the Base Rate.  “Benchmark” means, initially, USD LIBOR; provided that if a Benchmark Transition  Event or an Early Opt-in Election or a Term SOFR Transition Event, as applicable, and its related  Benchmark Replacement Date have occurred with respect to USD LIBOR or the then-current  Benchmark, then “Benchmark” means the applicable Benchmark Replacement to the extent that  such Benchmark Replacement has replaced such prior benchmark rate pursuant to Section 11.3(a).  

 

  84134605.9   MRC Energy Company Credit Agreement 4  “Benchmark Replacement” means:  (a) in the case of any Benchmark Transition Event or Early Opt-in Election, for any  Available Tenor, the first alternative set forth in the order below that can be determined by  Administrative Agent for the applicable Benchmark Replacement Date:  (1) the sum of: (a) Term SOFR and (b) the related Benchmark Replacement  Adjustment;  (2) the sum of: (a) Daily Simple SOFR and (b) the related Benchmark  Replacement Adjustment;  (3) the sum of: (a) the alternate benchmark rate that has been selected by  Administrative Agent and Borrower as the replacement for the then-current Benchmark for the  applicable Corresponding Tenor giving due consideration to (i) any selection or recommendation  of a replacement benchmark rate or the mechanism for determining such a rate by the Relevant  Governmental Body or (ii) any evolving or then-prevailing market convention for determining a  benchmark rate as a replacement for the then-current Benchmark for U.S. dollar-denominated  syndicated credit facilities at such time and (b) the related Benchmark Replacement Adjustment;  provided that, in the case of clause (1), such Unadjusted Benchmark Replacement is displayed on  a screen or other information service that publishes such rate from time to time as selected by  Administrative Agent in its reasonable discretion or  (b) in the case of a Term SOFR Transition Event, the sum of (x) Term SOFR and (y)  the related Benchmark Replacement Adjustment.  If the Benchmark Replacement as determined pursuant to clause (a) (1), (2) or (3) or (b) above  would be less than the Floor, the Benchmark Replacement will be deemed to be the Floor for the  purposes of this Agreement and the other Loan Documents.  “Benchmark Replacement Adjustment” means, with respect to any replacement of the  then- current Benchmark with an Unadjusted Benchmark Replacement for any applicable Interest  Period and Available Tenor for any setting of such Unadjusted Benchmark Replacement:  (1) for purposes of clauses (a) (1) and (2) and clause (b) of the definition of  “Benchmark Replacement,” the first alternative set forth in the order below that can be determined  by Administrative Agent:  (a) the spread adjustment, or method for calculating or determining such spread  adjustment, (which may be a positive or negative value or zero) as of the Reference Time such  Benchmark Replacement is first set for such Interest Period that has been selected or recommended  by the Relevant Governmental Body for the replacement of such Benchmark with the applicable  Unadjusted Benchmark Replacement for the applicable Corresponding Tenor;  (b) the spread adjustment (which may be a positive or negative value or zero)  as of the Reference Time such Benchmark Replacement is first set for such Interest Period that  would apply to the fallback rate for a derivative transaction referencing the ISDA Definitions to  

 

  84134605.9   MRC Energy Company Credit Agreement 5  be effective upon an index cessation event with respect to such Benchmark for the applicable  Corresponding Tenor; and  (2) for purposes of clause (a) (3) of the definition of “Benchmark Replacement,” the  spread adjustment, or method for calculating or determining such spread adjustment, (which may  be a positive or negative value or zero) that has been selected by Administrative Agent and  Borrower for the applicable Corresponding Tenor giving due consideration to (i) any selection or  recommendation of a spread adjustment, or method for calculating or determining such spread  adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark  Replacement by the Relevant Governmental Body on the applicable Benchmark Replacement Date  or (ii) any evolving or then-prevailing market convention for determining a spread adjustment, or  method for calculating or determining such spread adjustment, for the replacement of such  Benchmark with the applicable Unadjusted Benchmark Replacement for U.S. dollar- denominated  syndicated credit facilities; provided that, in the case of clause (1) above, such adjustment is  displayed on a screen or other information service that publishes such Benchmark Replacement  Adjustment from time to time as selected by Administrative Agent in its reasonable discretion.  “Benchmark Replacement Conforming Changes” means, with respect to any Benchmark  Replacement, any technical, administrative or operational changes (including changes to the  definition of “ABR,” the definition of “Business Day,” the definition of “Interest Period,” timing  and frequency of determining rates and making payments of interest, timing of borrowing requests  or prepayment, conversion or continuation notices, length of lookback periods, the applicability of  breakage provisions, and other technical, administrative or operational matters) that  Administrative Agent decides may be appropriate to reflect the adoption and implementation of  such Benchmark Replacement and to permit the administration thereof by Administrative Agent  in a manner substantially consistent with market practice (or, if Administrative Agent decides that  adoption of any portion of such market practice is not administratively feasible or if Administrative  Agent determines that no market practice for the administration of such Benchmark Replacement  exists, in such other manner of administration as Administrative Agent decides is reasonably  necessary in connection with the administration of this Agreement and the other Loan Documents).  “Benchmark Replacement Date” means the earliest to occur of the following events with  respect to the then-current Benchmark:  (1) in the case of clause (1) or (2) of the definition of “Benchmark Transition Event,”  the later of (a) the date of the public statement or publication of information referenced therein and  (b) the date on which the administrator of such Benchmark (or the published component used in  the calculation thereof) permanently or indefinitely ceases to provide all Available Tenors of such  Benchmark (or such component thereof);  (2) in the case of clause (3) of the definition of “Benchmark Transition Event,” the date  of the public statement or publication of information referenced therein;  (3) in the case of a Term SOFR Transition Event, the date that is ten (10) Business  Days after Administrative Agent has provided the Term SOFR Notice to the Lenders and Borrower  pursuant to Section 11.3(a)(ii); or  

 

  84134605.9   MRC Energy Company Credit Agreement 6  (4) in the case of an Early Opt-in Election, the sixth (6th) Business Day after the date  notice of such Early Opt-in Election is provided to the Lenders, so long as Administrative Agent  has not received, by 5:00 p.m. (New York City time) on the fifth (5th) Business Day after the date  notice of such Early Opt-in Election is provided to the Lenders, written notice of objection to such  Early Opt-in Election from Lenders comprising the Majority Lenders.  For the avoidance of doubt, (i) if the event giving rise to the Benchmark Replacement Date occurs  on the same day as, but earlier than, the Reference Time in respect of any determination, the  Benchmark Replacement Date will be deemed to have occurred prior to the Reference Time for  such determination and (ii) the “Benchmark Replacement Date” will be deemed to have occurred  in the case of clause (1) or (2) with respect to any Benchmark upon the occurrence of the applicable  event or events set forth therein with respect to all then-current Available Tenors of such  Benchmark (or the published component used in the calculation thereof).  “Benchmark Transition Event” means the occurrence of one or more of the following  events with respect to the then-current Benchmark:  (1) a public statement or publication of information by or on behalf of the administrator  of such Benchmark (or the published component used in the calculation thereof) announcing that  such administrator has ceased or will cease to provide all Available Tenors of such Benchmark (or  such component thereof), permanently or indefinitely, provided that, at the time of such statement  or publication, there is no successor administrator that will continue to provide any Available  Tenor of such Benchmark (or such component thereof);  (2) a public statement or publication of information by the regulatory supervisor for  the administrator of such Benchmark (or the published component used in the calculation thereof),  the Board of Governors of the Federal Reserve System, the Federal Reserve Bank of New York,  an insolvency official with jurisdiction over the administrator for such Benchmark (or such  component), a resolution authority with jurisdiction over the administrator for such Benchmark  (or such component) or a court or an entity with similar insolvency or resolution authority over the  administrator for such Benchmark (or such component), which states that the administrator of such  Benchmark (or such component) has ceased or will cease to provide all Available Tenors of such  Benchmark (or such component thereof) permanently or indefinitely, provided that, at the time of  such statement or publication, there is no successor administrator that will continue to provide any  Available Tenor of such Benchmark (or such component thereof); or  (3) a public statement or publication of information by the regulatory supervisor for  the administrator of such Benchmark (or the published component used in the calculation thereof)  announcing that all Available Tenors of such Benchmark (or such component thereof) are no  longer representative.  For the avoidance of doubt, a “Benchmark Transition Event” will be deemed to have occurred  with respect to any Benchmark if a public statement or publication of information set forth above  has occurred with respect to each then-current Available Tenor of such Benchmark (or the  published component used in the calculation thereof).  

 

  84134605.9   MRC Energy Company Credit Agreement 7  “Benchmark Unavailability Period” means the period (if any) (x) beginning at the time that  a Benchmark Replacement Date pursuant to clauses (1) or (2) of that definition has occurred if, at  such time, no Benchmark Replacement has replaced the then-current Benchmark for all purposes  hereunder and under any Loan Document in accordance with Section 11.3 and (y) ending at the  time that a Benchmark Replacement has replaced the then-current Benchmark for all purposes  hereunder and under any Loan Document in accordance with Section 11.3.  “Beneficial Ownership Certification” means a certification regarding beneficial ownership  as required by the Beneficial Ownership Regulation.  “Beneficial Ownership Regulation” means 31 C.F.R. § 1010.230.  “BHC Act Affiliate” shall have the meaning set forth in Section 13.25(b).  “Board” means the Board of Governors of the Federal Reserve System of the United States  (or any successor).  “Borrower” has the meaning set forth in the preamble to this Agreement.  “Borrower Materials” has the meaning set forth in the last paragraph of Section 7.1.  “Borrowing Base” has the meaning specified in Section 4.1.  “Borrowing Base Deficiency” means, as of any date, the amount, if any, by which the  Aggregate Credit Exposure on such date exceeds the Borrowing Base in effect on such date;  provided, that, for purposes of determining the existence and amount of any Borrowing Base  Deficiency, Letter of Credit Obligations will not be deemed to be outstanding to the extent such  obligations are secured by cash in the manner contemplated by this Agreement or any other Loan  Document.  “Borrowing Base Properties” means, at any time, all Oil and Gas Properties of Borrower  and the Restricted Subsidiaries in the most recent Reserve Report evaluated by the Lenders for  purposes of establishing the Borrowing Base.  Borrowing Base Properties do not include any Oil  and Gas Properties owned by a Foreign Subsidiary.  “Borrowing Base Utilization” means, as of any date of determination, the quotient,  expressed as a percentage, of (a) the Aggregate Credit Exposure as of such date, divided by (b) the  Borrowing Base as of such date.  “Business Day” means any day other than a Saturday or a Sunday or other day on which  commercial banks in Houston, Texas or New York, New York are authorized or required by law  to close, provided, that with respect to notices and determinations in connection with, and  payments of principal and interest on, Eurodollar-based Advances, such day is also a day for  trading by and between banks in Dollar deposits in the Interbank Eurodollar Market.  “Capitalized Lease” means, as applied to any Person, any lease of any property (whether  real, personal or mixed) with respect to which the discounted present value of the rental obligations  

 

  84134605.9   MRC Energy Company Credit Agreement 8  of such Person as lessee thereunder, in conformity with GAAP, is required to be capitalized on the  balance sheet of that Person.  “Cash Equivalents” means (a) marketable direct obligations issued by, or unconditionally  guaranteed by, the United States Government or issued by any agency thereof and backed by the  full faith and credit of the United States, in each case maturing within one year from the date of  acquisition; (b) certificates of deposit, time deposits, Eurodollar time deposits or overnight bank  deposits having maturities of six months or less from the date of acquisition issued by any Lender  or by any commercial bank organized under the laws of the United States or any state thereof  having combined capital and surplus of not less than $500,000,000; (c) commercial paper of an  issuer rated at least A 1 by S&P or P 1 by Moody’s, or carrying an equivalent rating by a nationally  recognized rating agency, if both of the two named rating agencies cease publishing ratings of  commercial paper issuers generally, and maturing within six months from the date of acquisition;  (d) repurchase obligations of any Lender or of any commercial bank satisfying the requirements  of clause (b) of this definition, having a term of not more than 30 days, with respect to securities  issued or fully guaranteed or insured by the United States government; (e) securities with  maturities of one year or less from the date of acquisition issued or fully guaranteed by any state,  commonwealth or territory of the United States, by any political subdivision or taxing authority of  any such state, commonwealth or territory or by any foreign government, the securities of which  state, commonwealth, territory, political subdivision, taxing authority or foreign government (as  the case may be) are rated at least A by S&P or A by Moody’s; (f) securities with maturities of six  months or less from the date of acquisition backed by standby letters of credit issued by any Lender  or any commercial bank satisfying the requirements of clause (b) of this definition; (g) money  market mutual or similar funds that invest exclusively in assets satisfying the requirements of  clauses (a) through (f) of this definition; or (h) money market funds that (i) comply with the criteria  set forth in SEC Rule 2a 7 under the Investment Company Act of 1940, as amended, (ii) are rated  AAA by S&P and Aaa by Moody’s and (iii) have portfolio assets of at least $5,000,000,000.  “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, implementation or  application thereof by any Governmental Authority or (c) the making or issuance of any request,  rule, guideline or directive (whether or not having the force of law) by any Governmental  Authority; provided that notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall  Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives  thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives  promulgated by the Bank for International Settlements, the Basel Committee on Banking  Supervision (or any successor or similar authority) or the United States or foreign regulatory  authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in  Law”, regardless of the date enacted, adopted or issued.  “Change of Control” means an event or series of events whereby any of the following  occurs:  (a) the Parent controls, directly or indirectly, less than 100% on a fully diluted  basis of the aggregate issued and outstanding voting stock (or comparable voting  interests) of Borrower;   

 

  84134605.9   MRC Energy Company Credit Agreement 9  (b) an event or series of events by which 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,  whether such right is exercisable immediately or only after the passage of time (such right,  an “option right”)), directly or indirectly, of a majority or more of each class 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);  provided, however, such “group” shall not consist of any existing “group” of shareholders  (or the members thereof) that may be deemed to beneficially own more than a majority of  any class of voting equity securities of the Parent pursuant to existing voting agreements  or otherwise; or  (c) the occurrence of a “Change of Control” (or any other defined term having  a similar purpose) as defined in any Indenture.  “CIP Regulations” has the meaning ascribed to such term in Section 12.15.  “Collateral” means all property of the Credit Parties, now owned or hereafter acquired,  upon which a Lien is created by any Collateral Document to secure the Indebtedness, including,  without limitation, (a) all Mortgaged Properties, (b) 100% of the Equity Interests of each  Restricted Subsidiary that is a Domestic Subsidiary, (c) 65% of the Equity Interests of each  Restricted Subsidiary that is a Foreign Subsidiary, and (d) all other tangible and intangible personal  property now owned or hereafter acquired by the Credit Parties that is located on, or relates to, any  of the Mortgaged Properties including accounts, notes, contract receivables, inventory, machinery,  equipment and general intangibles, provided, however, that notwithstanding the foregoing, the  Collateral shall not include any Excluded Assets.  “Collateral Documents” means the Pledge Agreement, the Mortgages and all other security  documents and pledge documents (and any joinders thereto) executed by any Credit Party in favor  of Administrative Agent for the benefit of the Secured Parties.  “Commitment Fee” means the fee payable to Administrative Agent for distribution to the  Revolving Credit Lenders in accordance with Section 2.9.  “Commitments” means the Revolving Credit Aggregate Commitment.  “Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et seq.),  as amended from time to time, and any successor statute.  “Commodity Hedging Agreement” means any commodity hedging or purchase agreement  or similar arrangement entered into with the intent of protecting against fluctuations in commodity  prices or the exchange of notional commodity obligations, either generally or under specific  contingencies, including, without limitation, commodity price swap agreements, forward  

 

  84134605.9   MRC Energy Company Credit Agreement 10  agreements or contracts of sale which provide for prepayment for deferred shipment or delivery of  oil, gas or other commodities.  “Compliance Certificate” means a certificate substantially in the form of Exhibit E, or in  such other form acceptable to the Administrative Agent.  “Connection Income Taxes” means Other Connection Taxes that are imposed on or  measured by net income (however denominated) or that are franchise Taxes or branch profits  Taxes.  “Consolidated” (or “consolidated”) means, when used with reference to any financial term  in this Agreement, the aggregate for two or more Persons of the amounts signified by such term  for all such Persons determined on a consolidated basis in accordance with GAAP, applied on a  consistent basis.  “Consolidated Cash Balance” means, at any time, the aggregate amount of cash and Cash  Equivalents, in each case, held or owned by (whether directly or indirectly), credited to the account  of, or otherwise reflected as an asset on the balance sheet of, the Borrower and its Subsidiaries,  other than Unrestricted Subsidiaries (other than (i) any cash or Cash Equivalents (including  proceeds of Advances) set aside to pay, whether in the ordinary course of business or otherwise,  but in any event, as permitted under this Agreement, amounts of the Borrower and its Subsidiaries  (other than Unrestricted Subsidiaries) then due and owing to third parties (including, for the  avoidance of doubt, to pay royalty obligations, working interest obligations, production payments  and severance taxes) and for which the Borrower or such Subsidiary, as applicable, has issued  checks or has initiated wires or ACH transfers in order to pay (or will issue, or reasonably  anticipates in good faith that it will issue, checks or initiate wires or ACH transfers in order to pay)  such amounts within five (5) Business Days), (ii) any amounts held as cash collateral as required  pursuant to Section 2.10, (iii) cash or Cash Equivalents that are held in a deposit account that is  used by the Borrower or any Subsidiary (other than an Unrestricted Subsidiary) exclusively for  trust, payroll, payroll taxes, and other employee wage and benefit payments, (iv) cash or Cash  Equivalents of the Borrower or any Subsidiary (other than an Unrestricted Subsidiary) to be used  by the Borrower or any such Subsidiary within five (5) Business Days (or such longer period as  reasonably agreed in writing by the Administrative Agent) to pay the purchase price for any  acquisition of any assets or property permitted hereunder by the Borrower or any Subsidiary (other  than Unrestricted Subsidiaries) pursuant to (x) a binding and enforceable purchase and sale  agreement with a third party containing customary provisions regarding the payment and refunding  of such purchase price, (y) a signed and binding letter of intent with a third party, or (z) any  unsigned “purchase agreement” or similar documentation which is subject to a binding letter of  intent and then being negotiated and will be executed prior to or simultaneously with the closing  of such acquisition, (v) any cash or Cash Equivalents of the Borrower or any Subsidiary (other  than an Unrestricted Subsidiary) that will be distributed in connection with one or more Restricted  Payments permitted under Section 8.5 within fifteen (15) Business Days (or such longer period as  reasonably agreed in writing by the Administrative Agent) from the date in question, (vi) net cash  proceeds contributed to the Borrower as a capital contribution or from the sale or issuance of  Equity Interests (other than Disqualified Equity Interests) of the Borrower within sixty (60) days  (or such longer period as reasonably agreed in writing by the Administrative Agent) immediately  preceding the date in question, (vii) cash or Cash Equivalents constituting purchase price deposits  

 

  84134605.9   MRC Energy Company Credit Agreement 11  held in escrow for the benefit of the Borrower or any Subsidiary (other than an Unrestricted  Subsidiary) pursuant to a binding and enforceable purchase and sale agreement with a third party  containing customary provisions regarding the payment and refunding of such purchase price and  (viii) the amount of royalty obligations, working interest obligations, production payments and  severance and ad valorem taxes of the Borrower or any Subsidiary (other than an Unrestricted  Subsidiary) which are accrued or are due and owing to third parties and any other similar amounts  owing to third parties held in suspense by the Borrower or any such Subsidiary as operator.  “Consolidated Cash Balance Threshold” means, at any time, $75,000,000.  “Consolidated Current Assets” means, as of any date of determination, the total  consolidated current assets of Parent and its Subsidiaries (other than Unrestricted Subsidiaries)  determined in accordance with GAAP (except as provided herein with respect to ASC Topic 815)  as of such date, plus the Unused Revolving Credit Availability on such date after giving effect to  all borrowings and repayments on such date.  For purposes of this definition, “Consolidated  Current Assets” shall not include any non-cash items resulting from the application of ASC Topic  815 or the fair value of any Commodity Hedging Agreement or any non-hedge derivative contract  (whether deemed effective or non-effective).  “Consolidated Current Liabilities” means, as of any date of determination, the total  consolidated current liabilities of Parent and its Subsidiaries (other than Unrestricted Subsidiaries)  determined in accordance with GAAP (except as provided herein with respect to ASC Topic 815)  as of such date, less current maturities under this Agreement or other Debt on such date.  For  purposes of this definition, “Consolidated Current Liabilities” shall not include any non-cash items  resulting from the requirements of ASC Topic 815 or the fair value of any Commodity Hedging  Agreement or any non-hedge derivative contract (whether deemed effective or non-effective), or  any liability resulting from the accounting for stock option expense.  “Consolidated EBITDA” means for any Test Period, the sum of Consolidated Net Income  for such period plus without duplication the following expenses or charges to the extent deducted  from Consolidated Net Income in such period: interest, taxes, depreciation, depletion,  amortization, and accretion of asset retirement obligations.  The term “Consolidated EBITDA”  shall exclude (a) any non-cash revenue or expense associated with hedging contracts resulting  from ASC Topic 815, (b) any non-cash income, gain, loss or expense arising from the issuance of  stock options or restricted stock, to the extent such items are included in Consolidated Net Income  and (c) any other non-cash charges (excluding accruals for cash expenses made in the ordinary  course of business) or non-cash gains.  “Consolidated Net Income” means with respect to Parent and its Subsidiaries, for any  period, the consolidated net income (or loss) of Parent and its Subsidiaries, determined on a  consolidated basis in accordance with GAAP; provided that there shall be excluded from such net  income (to the extent otherwise included therein) the following: (a) the net income of (i) any  Unrestricted Subsidiary and (ii) any Person in which Parent or any of its Subsidiaries has an interest  which interest does not cause the net income of such other Person to be consolidated with the net  income of Parent and its Subsidiaries in accordance with GAAP, in each case, except to the extent  of the amount of dividends or distributions actually paid in cash in such period by such Unrestricted  Subsidiary or such other Person to Parent or to any of its Subsidiaries (other than an Unrestricted  

 

  84134605.9   MRC Energy Company Credit Agreement 12  Subsidiary), as the case may be; (b) any extraordinary gains or losses, including gains or losses  attributable to property sales not in the ordinary course of business; and (c) the cumulative effect  of a change in accounting principles and any gains or losses attributable to writeups or write downs  of assets or any full cost ceiling impairment.  “Contractual Obligation” means, as to any Person, any provision of any security issued by  such Person or of any material agreement, instrument or other undertaking to which such Person  is a party or by which it or any of its property is bound.  “Corresponding Tenor” with respect to any Available Tenor means, as applicable, either a  tenor (including overnight) or an interest payment period having approximately the same length  (disregarding business day adjustment) as such Available Tenor.  “Covered Entity” shall have the meaning set forth in Section 13.25(b).  “Covered Party” shall have the meaning set forth in Section 13.25(a).  “Credit Exposure” means, as to any Lender at any time, an amount equal to the sum of  (a) the aggregate principal amount of all Revolving Credit Advances held by such Lender then  outstanding and (b) such Lender’s Revolving Credit Percentage of the Letter of Credit Obligations  then outstanding.  “Credit Parties” means Borrower and its Restricted Subsidiaries, and “Credit Party” means  any one of them, as the context indicates or otherwise requires.  “Current Ratio” means, as of any date of determination, the ratio of (a) Consolidated  Current Assets as of such date to (b) Consolidated Current Liabilities as of such date.  “Daily Adjusting LIBOR Rate” means for any day a per annum interest rate which is equal  to the quotient of the following:  (a) the LIBOR Rate;  divided by  (b) a percentage (expressed as a decimal) equal to 1.00 minus the maximum  rate on such date at which Administrative Agent is required to maintain reserves on “Euro- currency Liabilities” as defined in and pursuant to Regulation D of the Board of Governors  of the Federal Reserve System or, if such regulation or definition is modified, and as long  as Administrative Agent is required to maintain reserves against a category of liabilities  which includes Eurodollar deposits or includes a category of assets which includes  Eurodollar loans, the rate at which such reserves are required to be maintained on such  category;  such sum to be rounded upward, if necessary, in the discretion of Administrative Agent, to the  seventh decimal place.  

 

  84134605.9   MRC Energy Company Credit Agreement 13  “Daily Simple SOFR” means, for any day, SOFR, with the conventions for this rate (which  will include a lookback) being established by Administrative Agent in accordance with the  conventions for this rate selected or recommended by the Relevant Governmental Body for  determining “Daily Simple SOFR” for syndicated business loans; provided, that if Administrative  Agent decides that any such convention is not administratively feasible for Administrative Agent,  then Administrative Agent may establish another convention in its reasonable discretion.  “Debt” means, for any Person the sum of the following (without duplication):  (a) all  obligations of such Person for borrowed money or evidenced by bonds, debentures, notes or other  similar instruments (including principal, but excluding interest, fees and charges); (b) all  obligations of such Person (whether contingent or otherwise) in respect of bankers’ acceptances,  letters of credit, surety or other bonds and similar instruments; (c) all obligations of such Person  to pay the deferred purchase price of property or services (other than for borrowed money and  other than accounts payable (for the deferred purchase price of property or services) from time to  time incurred in the ordinary course of business which, if greater than ninety (90) days past the  invoice or billing date, are being contested in good faith by appropriate proceedings and for which  reserves adequate under GAAP shall have been established therefor); (d) all obligations under  leases which shall have been, or should have been, in accordance with GAAP, recorded as capital  leases in respect of which such Person is liable (whether contingent or otherwise including  principal but excluding interest, fees and charges); (e) all obligations under operating leases which  require such Person or its Affiliate to make payments over the term of such lease, including  payments at termination, based on the purchase price or appraisal value of the property subject to  such lease plus a marginal interest rate, and used primarily as a financing vehicle for, or to  monetize, such property; (f) all Debt (as described in the other clauses of this definition) of others  secured by a Lien on any asset of such Person, whether or not such Debt is assumed by such  Person, but valued at the lesser of (i) the amount of such Debt and (ii) the fair market value of the  property securing such Debt; (g) all Debt (as described in the other clauses of this definition) and  other obligations of others guaranteed by such Person or in which such Person otherwise assures  a creditor against loss of the debtor or obligations of others; (h) all obligations or undertakings of  such Person to maintain or cause to be maintained the financial position or covenants of others or  to purchase the Debt of others; (i) all obligations to deliver or sell Hydrocarbons in consideration  of advance payments, as disclosed by Section 7.15(c); (j) any Disqualified Equity Interests; and  (k) the undischarged balance of any production payment created by such Person or for the creation  of which such Person directly or indirectly received payment; provided, however, the items  described in clauses (b), (c), (d), (e), (f), (g), (h), (i), (j) and (k) shall only constitute part of Debt  if and to the extent the aggregate amount of obligations described in such clauses exceeds  $1,000,000.  Notwithstanding the foregoing, Debt shall not include (i) contingent obligations of  Borrower or any Restricted Subsidiary pursuant to any purchase and sale agreement, stock  purchase agreement, merger agreement or similar agreement so long as such obligations are  contingent (and not for amounts due and payable), (ii) obligations in respect of Commodity  Hedging Agreements or Interest Rate Agreements, (iii) indemnities incurred in the ordinary course  of business or in connection with the disposition of assets, (iv) any employee or director  compensation or any compensation paid to employees or directors pursuant to stock appreciation  rights or other equity based compensation awards, or (v) except to the extent set forth in clause (e)  above, obligations under operating leases.  

 

  84134605.9   MRC Energy Company Credit Agreement 14  “Debtor Relief Laws” means the Bankruptcy Code, and all other liquidation,  conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement,  receivership, insolvency, reorganization, or similar debtor relief laws of the United States or other  applicable jurisdictions from time to time in effect.  “Default” means any event that with the giving of notice or the passage of time, or both,  would constitute an Event of Default under this Agreement.  “Default Right” shall have the meaning set forth in Section 13.25(b).  “Defaulting Lender” means a Lender that, as determined by Administrative Agent (with  notice to Borrower of such determination), (a) has failed to perform any of its funding obligations  hereunder, including, without limitation, in respect of its Revolving Credit Percentage of any  Advances or participations in Letters of Credit, within two Business Days of the date required to  be funded by it hereunder, (b) has notified Borrower, Administrative Agent or any Lender that it  does not intend to comply with its funding obligations or has made a public statement to that effect  with respect to its funding obligations hereunder or under other agreements in which it commits to  extend credit, (c) has failed, within three Business Days after request by Administrative Agent, to  confirm in a manner satisfactory to Administrative Agent that it will comply with its funding  obligations; provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause  (c) upon receipt by Administrative Agent of such confirmation in form and substance satisfactory  to Administrative Agent, or (d) has, or has a direct or indirect parent company that has, (i) become  the subject of a proceeding under any Debtor Relief Law, (ii) had appointed for it a receiver,  custodian, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person  charged with reorganization or liquidation of its business or assets, including the Federal Deposit  Insurance Corporation or any other state, federal or other governmental or regulatory authority  acting in such a capacity, or (iii) become the subject of a Bail-In Action; provided that a Lender  shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity  interest in that Lender or any direct or indirect parent company thereof by a Governmental  Authority unless deemed so by Administrative Agent in its sole discretion.  “Deficiency Payment Commencement Date” has the meaning specified in Section 4.6.  “Deposit Account Control Agreement” means a “Deposit Account Control Agreement” (as  such term is defined in the Pledge Agreement).  “Designated Jurisdiction” means any country or territory to the extent that such country or  territory itself is the subject of any Sanction.  “Determination Date” has the meaning specified in Section 4.2.  “Disposition” or “Dispose” means the sale, transfer, license, lease, exchange or other  disposition (including any sale and leaseback transaction) of any property by any Person, including  any sale, assignment, transfer or other disposal, with or without recourse, of any notes or accounts  receivable or any rights and claims associated therewith.  “Disqualified Equity Interest” means any Equity Interest which, by its terms (or by the  terms of any security or other Equity Interest into which it is convertible or for which it is  

 

  84134605.9   MRC Energy Company Credit Agreement 15  exchangeable), or upon the happening of any event or condition (i) matures or is mandatorily  redeemable (other than solely for an Equity Interest which would not otherwise be a Disqualified  Equity Interest), pursuant to a sinking fund obligation, other provision for payment or otherwise,  (ii) is redeemable at the option of the holder thereof (other than solely for an Equity Interest which  would not otherwise be a Disqualified Equity Interest), in whole or in part, (iii) provides for any  scheduled payments or dividends to be made in cash, or (iv) is or becomes convertible into, or  exchangeable for, Debt or any other Equity Interest that would constitute a Disqualified Equity  Interest under any other provision of this definition, in each case, prior to the date that is 91 days  after the Revolving Credit Maturity Date at the time of issuance, except, in the case of clauses  (i) and (ii), if as a result of a change of control event or asset sale or other Disposition or casualty  event, so long as any rights of the holders thereof to require the redemption thereof upon the  occurrence of such a change of control event or asset sale or other Disposition or casualty event  are subject to the prior payment in full of the Indebtedness (other than Lender Hedging  Obligations); provided that if such Equity Interest is issued pursuant to a plan for the benefit of  employees of Parent, Borrower or any of their respective Subsidiaries or by any such plan to such  employees, such Equity Interest shall not constitute a Disqualified Equity Interest solely because  it may be required to be repurchased by Parent, Borrower or the Restricted Subsidiaries.  “Distribution” has the meaning specified in Section 8.5.  “Dollars” and the sign “$” means lawful money of the United States of America.  “Domestic Subsidiary” means any Subsidiary of Borrower organized under the laws of any  jurisdiction within the United States of America.  “Early Opt-in Election” means, if the then-current Benchmark is USD LIBOR, the  occurrence of:  (1) a notification by Administrative Agent to (or the request by Borrower to  Administrative Agent to notify) each of the other parties hereto that at least five (5) currently  outstanding U.S. dollar-denominated syndicated credit facilities at such time contain (as a result  of amendment or as originally executed) a SOFR-based rate (including SOFR, a term SOFR or  any other rate based upon SOFR) as a benchmark rate (and such syndicated credit facilities are  identified in such notice and are publicly available for review), and  (2) the joint election by Administrative Agent and Borrower to trigger a fallback from  USD LIBOR and the provision by Administrative Agent of written notice of such election to the  Lenders.  “EEA Financial Institution” means (a) any credit institution or investment firm established  in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority,  (b) any entity established in an EEA Member Country which is a parent of an institution described  in clause (a) of this definition, or (c) any financial institution established in an EEA Member  Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and  is subject to consolidated supervision with its parent.  “EEA Member Country” means any of the member states of the European Union, Iceland,  Liechtenstein, and Norway.  

 

  84134605.9   MRC Energy Company Credit Agreement 16  “EEA Resolution Authority” means any public administrative authority or any person  entrusted with public administrative authority of any EEA Member Country (including any  delegee) having responsibility for the resolution of any EEA Financial Institution.  “Effective Date” means the date on which all the conditions precedent set forth in  Sections 5.1 and 5.2 (with respect to the initial Advance) have been satisfied.  “Electronic Transmission” means each document, instruction, authorization, file,  information and any other communication transmitted, posted or otherwise made or communicated  by e-mail or E-Fax, or otherwise to or from an E-System or other equivalent service.  “Eligible Assignee” means any Person that meets the requirements to be an assignee under  Section 13.7(b)(iii), (v) and (vi) (subject to such consents, if any, as may be required under Section  13.7(b)(iii)).  “Eligible Contract Participant” means an “eligible contract participant” as defined in the  Commodity Exchange Act and regulations thereunder.   “Equity Interest” means (i) in the case of any corporation, all capital stock and any  securities exchangeable for or convertible into capital stock, (ii) in the case of an association or  business entity, any and all shares, interests, participations, rights or other equivalents of corporate  stock (however designated) in or to such association or entity, (iii) in the case of a partnership or  limited liability company, partnership or membership interests (whether general or limited) and  (iv) any other interest or participation that confers on a Person the right to receive a share of the  profits and losses of, or distribution of assets of, the issuing Person, and including, in all of the  foregoing cases described in clauses (i), (ii), (iii) or (iv), any warrants, rights or other options to  purchase or otherwise acquire any of the interests described in any of the foregoing cases.  “ERISA” means the Employee Retirement Income Security Act of 1974, as amended, or  any successor act or code and the regulations in effect from time to time thereunder.  “E-System” means any electronic system and any other Internet or extranet-based site,  whether such electronic system is owned, operated, hosted or utilized by Administrative Agent,  any of its Affiliates or any other Person, providing for access to data protected by passcodes or  other security system.  “EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule published  by the Loan Market Association (or any successor person), as in effect from time to time.  “Eurodollar-based Advance” means any Advance which bears interest at the Eurodollar- based Rate.  “Eurodollar-based Rate” means a per annum interest rate which is equal to the sum of the  Applicable Margin, plus the quotient of:  (a) the LIBOR Rate,   divided by  

 

  84134605.9   MRC Energy Company Credit Agreement 17  (b) a percentage equal to 100% minus the maximum rate on such date at which  Administrative Agent is required to maintain reserves on ‘Eurocurrency Liabilities’ as  defined in and pursuant to Regulation D of the Board of Governors of the Federal Reserve  System or, if such regulation or definition is modified, and as long as Administrative Agent  is required to maintain reserves against a category of liabilities which includes  Eurocurrency deposits or includes a category of assets which includes Eurocurrency loans,  the rate at which such reserves are required to be maintained on such category,  such sum to be rounded upward, if necessary, in the discretion of Administrative Agent, to the  seventh decimal place.  “Eurodollar-Interest Period” means, for any Eurodollar-based Advance, an Interest Period  of one, three or six months (or any shorter or longer periods agreed to in advance by Borrower,  Administrative Agent and Revolving Credit Lenders) as selected by Borrower, for such  Eurodollar-based Advance pursuant to Section 2.3.  “Eurodollar Lending Office” means, (a) with respect to Administrative Agent,  Administrative Agent’s office identified on Schedule 13.6 or such other branch of Administrative  Agent, domestic or foreign, as it may hereafter designate as its Eurodollar Lending Office by  written notice to Borrower and Lenders and (b) as to each of Lenders, the office, branch or affiliate  designated by such Lender as its Eurodollar Lending Office by written notice to Borrower and  Administrative Agent.  “Event of Default” means each of the Events of Default specified in Section 9.1 hereof.  “Excluded Account” means (i) any deposit account, securities account or commodities  account exclusively used for payroll, payroll taxes and other employee wage and benefit payments,  (ii) any deposit accounts, trust accounts, escrow accounts or security deposits established pursuant  to statutory obligations or for the payment of taxes or holding funds in trust for third parties in the  ordinary course of business or in connection with acquisitions, investments or dispositions  permitted under this Agreement, deposits in the ordinary course of business in connection with  workers’ unemployment insurance and other types of social security, reserve accounts, and escrow  accounts established pursuant to contractual obligations to third parties for casualty payments and  insurance proceeds, (iii) zero balance accounts and (iv) deposit accounts, securities accounts or  commodities accounts in which the aggregate average monthly balance on deposit (or, in the case  of any securities account, the total fair market value of all securities held in such account) does not  exceed $20,000,000.  “Excluded Assets” means the collective reference to:  (a) any interest in leased real property that is not an Oil and Gas Property,  including, without limitation, any leasehold interests in real property (except to the extent  a security interest in any such interest can be perfected solely by filing a UCC financing  statement);  (b) any fee interest in real property that is not an Oil and Gas Property;  

 

  84134605.9   MRC Energy Company Credit Agreement 18  (c) any licenses, franchises, charters and authorizations of a Governmental  Authority to the extent a security interest therein under the Loan Documents is prohibited  or would require the consent, license or approval of any Governmental Authority;  (d) any asset if the granting of a security interest under the Loan Documents in  such asset would be prohibited by any Requirement of Law;  (e) any lease, license or other agreement to the extent that a grant of a security  interest therein under the Loan Documents would violate, create a default under or  invalidate such lease, license or agreement;  (f) any Equity Interests issued by, or assets of, any Unrestricted Subsidiary;  (g) any Equity Interests issued by Borrower;  (h) any assets subject to a Lien permitted by Section 8.2(b) if the contract or  other agreement in which such Lien is granted prohibits the creation of any other Lien on  such assets (but only for so long as such contract or other agreement in which such Lien is  granted is in effect); and  (i) any motor vehicles and any other assets subject to a certificate of title (other  than proceeds thereof), to the extent a security interest on such motor vehicles or other  assets cannot be perfected solely by filing a UCC financing statement;  provided that (A) in the case of clauses (c), (d) and (e) above, such exclusion shall not apply (i) to  the extent the prohibition or restriction is ineffective under Section 9-406, 9-407, 9-408 or 9-409  of the Uniform Commercial Code or other applicable law or (ii) to proceeds of the assets referred  to in such clauses, the assignment of which is expressly deemed effective under Section 9-406, 9- 407, 9-408 or 9-409 of the Uniform Commercial Code or other applicable law, and (B) assets  described in clauses (c), (d), (e) and (h) above shall no longer be “Excluded Assets” upon  termination of the applicable prohibition or restriction described above that caused such assets to  be treated as “Excluded Assets” or receipt of a consent from the applicable parties necessary to  grant a Lien on such assets.  “Excluded Hedges” means, collectively, Commodity Hedging Agreements that (a) are  basis differential or roll swaps on volumes of crude oil, natural gas or natural gas liquids already  hedged under other Commodity Hedging Agreements permitted by Section 8.11 or (b) are a hedge  of volumes of crude oil or natural gas or natural gas liquids by means of a price “floor” for which  there exists no deferred obligation to pay the related premium or other purchase price or the only  deferred obligation is to either pay the premium or other purchase price on each settlement date,  or pay the financing for such premium or other purchase price.  “Excluded Swap Obligation” means, with respect to any Guarantor, any Swap Obligation  if, and to the extent that, all or a portion of the guarantee of such Guarantor of, or the grant by such  Guarantor of a security interest to secure, such Swap Obligation (or any guarantee thereof) is or  becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the  Commodity Futures Trading Commission (or the application or official interpretation of any  thereof) by virtue of such Guarantor’s failure for any reason to constitute an “eligible contract  

 

  84134605.9   MRC Energy Company Credit Agreement 19  participant” as defined in the Commodity Exchange Act and the regulations thereunder at the time  the guarantee of such Guarantor or the grant of such security interest becomes effective with  respect to such Swap Obligation.  If a Swap Obligation arises under a master agreement governing  more than one swap, such exclusion shall apply only to the portion of such Swap Obligation that  is attributable to swaps for which such guarantee or security interest is or becomes illegal.  “Excluded Taxes” means any of the following Taxes imposed on or with respect to a  Recipient or required to be withheld or deducted from a payment to a Recipient, (a) Taxes imposed  on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes,  in each case, (i) imposed as a result of such Recipient being organized under the laws of, or having  its principal office or, in the case of any Lender, its applicable lending office located in, the  jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other  Connection Taxes, (b) in the case of a Lender, U.S. federal withholding Taxes imposed on amounts  payable to or for the account of such Lender with respect to an applicable interest in an Advance  or Revolving Credit Commitment Amount pursuant to a law in effect on the date on which (i) such  Lender acquires such interest in an Advance or Revolving Credit Commitment Amount (other than  pursuant to an assignment request by Borrower under Section 13.11(a)) or (ii) such Lender changes  its lending office, except in each case to the extent that, pursuant to Section 11.9, amounts with  respect to such Taxes were payable either to such Lender’s assignor immediately before such  Lender became a party hereto or to such Lender immediately before it changed its lending office,  (c) Taxes attributable to such Recipient’s failure to comply with Section 11.9(g) and (d) any U.S.  federal withholding Taxes imposed under FATCA.  “Existing Commodity Hedging Agreements” means any Commodity Hedging Agreements  entered into between any Credit Party and any Lender or Withdrawing Lender or Affiliate of a  Lender or a Withdrawing Lender prior to the Effective Date and in effect on the Effective Date,  including, without limitation, the Withdrawing Lender Commodity Hedging Agreements.  “Existing Credit Agreement” has the meaning set forth in the Recitals to this Agreement.  “Existing Letters of Credit” means the letters of credit issued under the Existing Credit  Agreement and set forth on the attached Schedule 1.4.  “Existing Mortgages” means the Mortgages listed on Schedule 1.5 hereto.  “FATCA” means Sections 1471 through 1474 of the Internal Revenue Code, as of the date  of this Agreement (or any amended or successor version that is substantively comparable), any  current or future regulations or official interpretations thereof and any agreements entered into  pursuant to Section 1471(b)(1) of the Internal Revenue Code.  “Federal Funds Effective Rate” means, for any day, a fluctuating interest 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, as published for such day (or,  if such day is not a Business Day, for the next preceding Business Day) by the Federal Reserve  Bank of New York, or, if such rate is not so published for any day which is a Business Day, the  average of the quotations for such day on such transactions received by Administrative Agent from  three Federal funds brokers of recognized standing selected by Administrative Agent, all as  

 

  84134605.9   MRC Energy Company Credit Agreement 20  conclusively determined by Administrative Agent, such sum to be rounded upward, if necessary,  in the discretion of Administrative Agent, to the nearest whole multiple of 1/100th of 1%.  “Fee Letter” means the fee letter by and between Borrower and RBC, dated as of November  18, 2021, relating to the Indebtedness hereunder, as amended, restated, replaced or otherwise  modified from time to time.  “Fees” means the Commitment Fee, the Letter of Credit Fees and the other fees and charges  (including any agency fees) payable by Borrower to Lenders, Issuing Lenders or Administrative  Agent hereunder or under the Fee Letter.  “Fiscal Quarter” means any of the four quarters of any Fiscal Year.  “Fiscal Year” means the twelve-month period ending on each December 31.  “Floor” means the benchmark rate floor, if any, provided in this Agreement initially (as of  the execution of this Agreement, the modification, amendment or renewal of this Agreement or  otherwise) with respect to USD LIBOR.  “Foreign Lender” means a Lender that is not a U.S. Person.  “Foreign Subsidiary” means any Subsidiary, other than a Domestic Subsidiary, and  “Foreign Subsidiaries” means any or all of them.  “Fronting Exposure” means, at any time there is an Defaulting Lender, with respect to each  Issuing Lender, such Defaulting Lender’s Revolving Credit Percentage of the outstanding Letter  of Credit Obligations with respect to Letters of Credit issued by such Issuing Lender.  “GAAP” means, generally accepted accounting principles and practices which are  recognized as such by the American Institute of Certified Public Accountants acting through its  Accounting Principles Board or by the Financial Accounting Standards Board or through other  appropriate boards or committees thereof and which are consistently applied for all periods after  the date hereof so as to properly reflect the financial conditions, and the results of operations and  changes in financial position, of the Parent and Borrower, except that any accounting principle or  practice required to be changed by the Accounting Principles Board or Financial Accounting  Standards Board (or other appropriate board or committee or such Boards) in order to continue as  a generally accepted accounting principle or practice may be so changed.  “Gas Balancing Agreement” means any agreement or arrangement whereby any Credit  Party, or any other party having an interest in any Hydrocarbons to be produced from Oil and Gas  Properties in which any Credit Party owns an interest, has a right to take more than its proportionate  share of production therefrom.  “Governmental Authority” means the government of the United States of America 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  

 

  84134605.9   MRC Energy Company Credit Agreement 21  government (including without limitation any supranational bodies such as the European Union or  the European Central Bank).  “Guarantor(s)” means the Parent and each Restricted Subsidiary of Borrower.  “Guaranty” means the Third Amended, Restated and Consolidated Unconditional  Guaranty to be executed and delivered by the Guarantors as of November 18, 2021 in the form  attached hereto as Exhibit D.  “Hazardous Material” means any hazardous or toxic waste, substance or material defined  or regulated as such in or for purposes of the Hazardous Material Laws.  “Hazardous Material Laws” means all laws, codes, ordinances, rules, regulations and other  governmental restrictions and requirements issued by any federal, state, local or other  Governmental Authority or quasi-Governmental Authority or body (or any agency, instrumentality  or political subdivision thereof) pertaining to any substance or material which is regulated for  reasons of health, safety or the environment and which is present or alleged to be present on or  about or used in any facilities owned, leased or operated by any Credit Party, or any portion thereof  including, without limitation, those relating to soil, surface, subsurface ground water conditions  and the condition of the indoor and outdoor ambient air; any so-called “superfund” or “superlien”  law; and any other United States federal, state or local statute, law, ordinance, code, rule,  regulation, order or decree regulating, relating to, or imposing liability or standards of conduct  concerning, any Hazardous Material, as now or at any time during the term of the Agreement in  effect.  “Hedge Termination Value” means, in respect of any one or more Commodity Hedging  Agreements or Interest Rate Agreements, after taking into account the effect of any legally  enforceable netting agreement relating to such Commodity Hedging Agreements or Interest Rate  Agreements, as applicable, (a) for any date on or after the date such Commodity Hedging  Agreements or Interest Rate Agreements, as applicable, have been closed out and termination  value(s) determined in accordance therewith, such termination value(s) and (b) for any date prior  to the date referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for  such Commodity Hedging Agreements or Interest Rate Agreements, as applicable, as determined  by the counterparties to such Commodity Hedging Agreements or Interest Rate Agreements, as  applicable.  “Hydrocarbon Interests” means all rights, titles, interests and estates now or hereafter  acquired in and to oil and gas leases, oil, gas and mineral leases, or other liquid or gaseous  Hydrocarbon leases, mineral fee interests, overriding royalty and royalty interests, net profit  interests and production payment interests, including any reserved or residual interests of whatever  nature.  “Hydrocarbons” means oil, gas, casinghead gas, drip gasoline, natural gasoline,  condensate, distillate, liquid hydrocarbons, gaseous hydrocarbons and all products refined or  separated therefrom.  “Immaterial Title Deficiencies” means, with respect to Hydrocarbon Interests, defects or  clouds on title, discrepancies in reported net revenue or working interest ownership interests and  

 

  84134605.9   MRC Energy Company Credit Agreement 22  other defects, discrepancies, Liens and similar matters which do not, individually or in the  aggregate, affect Oil and Gas Properties with a value greater than five percent (5%) of the value  of all such properties included in the Borrowing Base.  “Increased Costs” has the meaning ascribed to such term in Section 11.6.  “Indebtedness” means (a) all indebtedness, obligations and liabilities of every nature,  contingent or otherwise, of Borrower or any Guarantor to any of the Lenders, any of the Lenders’  Affiliates, the Administrative Agent, or the Issuing Lenders, individually or collectively, under  any Loan Document, whether for principal, interest, reimbursement of amounts drawn under any  Letter of Credit, funding indemnification amounts, fees, expenses, indemnification or otherwise,  (b) Lender Hedging Obligations, and (c) Lender Product Obligations, in each case whether  existing on the date of this Agreement or arising thereafter, direct or indirect, joint or several,  absolute or contingent, matured or unmatured, liquidated or unliquidated, secured or unsecured,  including interest accruing subsequent to the filing of a petition or other action concerning  bankruptcy or other similar proceedings, and all renewals, extensions, refinancings and  replacements for the foregoing; provided; however, that in no event shall the Indebtedness include,  with respect to any Guarantor, any Excluded Swap Obligations of such Guarantor.  “Indemnified Person” has the meaning specified in Section 13.5.  “Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or with  respect to any payment made by or on account of any obligation of any Credit Party under any  Loan Document and (b) to the extent not otherwise described in (a), Other Taxes.  “Indenture” means any indenture by and among Parent or any Credit Party, as issuer and/or  a guarantor, and a trustee, pursuant to which any Senior Notes are issued, as the same may be  amended, restated, supplemented or otherwise modified from time to time to the extent not  prohibited by this Agreement.  “Information” has the meaning specified in Section 13.10.  “Interest Period” means with respect to a Eurodollar-based Advance, a Eurodollar-Interest  Period, commencing on the day a Eurodollar-based Advance is made, or on the effective date of  an election of the Eurodollar-based Rate made under Section 2.3; provided, however that (i) any  Interest Period which would otherwise end on a day which is not a Business Day shall end on the  next succeeding Business Day, except that as to an Interest Period in respect of a Eurodollar-based  Advance, if the next succeeding Business Day falls in another calendar month, such Interest Period  shall end on the next preceding Business Day, (ii) when an Interest Period in respect of a  Eurodollar-based Advance begins on a day which has no numerically corresponding day in the  calendar month during which such Interest Period is to end, it shall end on the last Business Day  of such calendar month, and (iii) no Interest Period in respect of any Advance shall extend beyond  the Revolving Credit Maturity Date.  “Interest Rate Agreement” means any interest rate protection agreement, interest rate future  agreement, interest rate option agreement, interest rate swap agreement, interest rate cap  agreement, interest rate collar agreement, interest rate hedge agreement or other similar agreement  or arrangement designed to protect against fluctuations in interest rates.  

 

  84134605.9   MRC Energy Company Credit Agreement 23  “Internal Revenue Code” means the Internal Revenue Code of 1986 of the United States  of America, as amended from time to time.  “Investment” has the meaning specified in Section 8.6.  “IRS” means the United States Internal Revenue Service  “ISDA Definitions” means the 2006 ISDA Definitions published by the International  Swaps and Derivatives Association, Inc. or any successor thereto, as amended or supplemented  from time to time, or any successor definitional booklet for interest rate derivatives published from  time to time by the International Swaps and Derivatives Association, Inc. or such successor thereto.  “Issuing Lender” means RBC, and each Lender appointed by the Borrower and approved  by the Administrative Agent (not to be unreasonably withheld, conditioned or delayed) that agrees  to act as an issuer of Letters of Credit hereunder, in each case, in its capacity as the issuer of Letters  of Credit hereunder, and any successor designated by Borrower and the Revolving Credit Lenders.  “Issuing Office” means such office as the applicable Issuing Lender shall designate as its  Issuing Office.  “L/C Indemnified Amounts” has the meaning ascribed to such term in Section 3.9.  “L/C Indemnified Person” has the meaning ascribed to such term in Section 3.9.  “Lender Counterparty” means any Lender or any Affiliate of a Lender counterparty to a  Commodity Hedging Agreement or Interest Rate Agreement with any Credit Party; provided that  any Withdrawing Lender that was a Lender Counterparty under the Existing Credit Agreement  shall be deemed to be a Lender Counterparty hereunder solely with respect to the Existing  Commodity Hedging Agreements to which such Withdrawing Lender is a party.  “Lender Hedging Obligations” means all obligations arising from time to time under  Commodity Hedging Agreements and Interest Rate Agreements permitted hereunder and entered  into from time to time between any Credit Party, on the one hand and a Lender Counterparty on  the other hand (including any such obligations under any Existing Commodity Hedging  Agreements); provided, however, that if a Lender Counterparty ceases to be a Lender hereunder  or an Affiliate of a Lender hereunder, Lender Hedging Obligations shall only include such  obligations to the extent arising from transactions and confirmations entered into under  Commodity Hedging Agreements and Interest Rate Agreements at any time such Person was a  Lender or an Affiliate of a Lender hereunder, without giving effect to any extension, increases or  modifications thereof which are made after such Person ceases to be a Lender or an Affiliate of a  Lender hereunder; provided, further, that all obligations arising under the Withdrawing Lender  Commodity Hedging Agreements in respect of the trades set forth on Schedule 6.22(c) shall only  constitute Lender Hedging Obligations hereunder until the maturity or expiration of each such  trade.  “Lender Product Obligations” means all obligations arising from time to time under Lender  Products (including any such obligations existing on the Effective Date); provided, however, that  if a Lender or an Affiliate of a Lender ceases to be a Lender hereunder or an Affiliate of a Lender  

 

  84134605.9   MRC Energy Company Credit Agreement 24  hereunder, then all Lender Products between a Credit Party or Parent and such Lender or Affiliate  of a Lender shall not constitute Lender Product Obligations and shall not be secured by the  Collateral Documents or guaranteed pursuant to the Guaranty.  “Lender Products” means any one or more of the following types of services or facilities  extended to the Parent or any Credit Party by any Lender or Affiliate of a Lender:  (i) credit cards,  (ii) credit card processing services, (iii) debit cards, (iv) purchase cards, (v) Automated Clearing  House (ACH) transactions, (vi) cash management, including controlled disbursement services,  and (vii) establishing and maintaining deposit accounts.  “Lenders” shall have the meaning set forth in the preamble, and shall include the Revolving  Credit Lenders and any Eligible Assignee which becomes a Lender pursuant to Section 13.7.  “Letter of Credit Agreement” means, collectively, the letter of credit application and  related documentation executed and/or delivered by Borrower in respect of each Letter of Credit,  in each case reasonably satisfactory to the applicable Issuing Lender.  “Letter of Credit Documents” shall have the meaning ascribed to such term in  Section 3.7(a).  “Letter of Credit Fees” means the fees payable in connection with Letters of Credit  pursuant to Sections 3.4(a)(i) and (ii).  “Letter of Credit Maximum Amount” means Fifty Million Dollars ($50,000,000).  “Letter of Credit Obligations” means at any date of determination, the sum of (a) the  aggregate undrawn amount of all Letters of Credit then outstanding, and (b) the aggregate amount  of Reimbursement Obligations which remain unpaid as of such date.  “Letter of Credit Payment” means any amount paid or required to be paid by the applicable  Issuing Lender in its capacity hereunder as issuer of a Letter of Credit as a result of a draft or other  demand for payment under any Letter of Credit.  “Letter of Credit” means each Existing Letter of Credit and each standby letter of credit  issued by an Issuing Lender at the request of or for the account of Borrower pursuant to Article 3.  “LIBOR Rate” means,  (a) for any Interest Period with respect to any Eurodollar-based Advance, the  per annum rate of interest, expressed on the basis of a year of 360 days, determined by  Administrative Agent, which is equal to USD LIBOR (as set forth by any service selected  by Administrative Agent that has been nominated by ICE Benchmark Administration as  an authorized information vendor for the purpose of displaying such rates) with a term  equivalent to such Eurodollar-Interest Period, determined as of approximately 11:00 a.m.  (London time) two (2) Business Days prior to the first day of such Eurodollar-Interest  Period.  If the rates referenced in the preceding sentence are not available, “LIBOR Rate”  shall mean the per annum rate of interest determined by Administrative Agent as the rate  of interest, expressed on a basis of 360 days, at which deposits in Dollars for delivery on  

 

  84134605.9   MRC Energy Company Credit Agreement 25  the first day of such Eurodollar-Interest Period in same day funds in the approximate  amount of the Eurodollar-based Advance being made, continued or converted by  Administrative Agent and with a term and amount comparable to such Eurodollar-Interest  Period and principal amount of such Eurodollar-based Advance as would be offered by  Administrative Agent’s London Branch to major banks in the offshore Dollar market at  their request at approximately 11:00 a.m. (London time) two (2) Business Days prior to the  first day of such Eurodollar-Interest Period; provided that, if any such rate is below zero,  the LIBOR Rate will be deemed to be zero; and  (b) for purposes of determining the Daily Adjusting LIBOR Rate in connection  with a Base Rate Advance, the per annum rate of interest, expressed on the basis of a year  of 360 days, determined by Administrative Agent, which is equal to USD LIBOR (as set  forth by any service selected by Administrative Agent that has been nominated by ICE  Benchmark Administration as an authorized information vendor for the purpose of  displaying such rates) with a term equivalent to one (1) month, determined as of  approximately 11:00 a.m. (London time) on such day, or if such day is not a Business Day,  on the immediately preceding Business Day.  If the rates referenced in the preceding  sentence are not available, “LIBOR Rate” shall mean the per annum rate of interest  determined by Administrative Agent as the rate of interest, expressed on a basis of 360  days, at which deposits in Dollars for delivery on such day in same day funds in the  approximate amount of the Base Rate Advance being made or converted by Administrative  Agent and with a term equal to one (1) month and amount comparable to the principal  amount of such Base Rate Advance as would be offered by Administrative Agent’s London  Branch to major banks in the offshore Dollar market at their request at approximately 11:00  a.m. (London time) on such day; provided that, if any such rate is below zero, the LIBOR  Rate will be deemed to be zero.  “Lien” means any security interest in or lien on or against any property arising from any  pledge, assignment, hypothecation, mortgage, security interest, deposit arrangement, trust receipt,  conditional sale or title retaining contract, sale and leaseback transaction, Capitalized Lease,  consignment or bailment for security, or any other type of lien, charge, encumbrance, title  exception, preferential or priority arrangement affecting property (including with respect to stock,  any stockholder agreements, voting rights agreements, buy-back agreements and all similar  arrangements), whether based on common law or statute.  “Liquidity” means, at any date of determination, the sum of (a) Unused Revolving Credit  Availability and (b) the Consolidated Cash Balance.  “Loan Documents” means, collectively, this Agreement, the Notes, the Letter of Credit  Agreements, the Letters of Credit, the Guaranty, the Collateral Documents, and any other  agreements, instruments and documents executed by the Parent or a Credit Party pursuant to this  Agreement, but excluding Commodity Hedge Agreements, Interest Rate Agreements and Lender  Products documents.  “Majority Lenders” means at any time, the Revolving Credit Lenders holding at least  51.0% of the Revolving Credit Aggregate Commitment (or, if the Revolving Credit Aggregate  Commitment has been terminated (whether by maturity, acceleration or otherwise), the aggregate  

 

  84134605.9   MRC Energy Company Credit Agreement 26  principal amount outstanding under the Revolving Credit); provided that, for purposes of  determining Majority Lenders hereunder, the Letter of Credit Obligations shall be allocated among  the Revolving Credit Lenders based on their respective Revolving Credit Percentages.  The  Revolving Credit Commitment Amount of, and portion of the Aggregate Credit Exposure  attributable to, any Defaulting Lender shall be excluded for purposes of making a determination  of “Majority Lenders”.  “Material Adverse Effect” means a material adverse effect on (a) the business, operations,  properties or financial condition of the Parent and the Credit Parties taken as a whole, (b) the ability  of the Parent, Borrower or any other Credit Party to perform its material obligations under this  Agreement or any other Loan Document to which it is a party, or (c) the validity or enforceability  of this Agreement or any of the other Loan Documents or the rights or remedies of Administrative  Agent or Lenders hereunder or thereunder.  “Material Debt” means Debt under the Senior Notes (and any Permitted Refinancing  thereof) and any other Debt (other than Advances and Letters of Credit), or obligations in respect  of Commodity Hedging Agreements or Interest Rate Agreements, of Parent or any one or more of  the Credit Parties, in each case in an aggregate principal amount exceeding the Threshold Amount.   For purposes of determining Material Debt, the “principal amount” of the obligations of Parent or  any Credit Party in respect of any Commodity Hedging Agreement or Interest Rate Agreement at  any time shall be the Hedge Termination Value.  “Material Domestic Subsidiary” means a wholly-owned Domestic Subsidiary of Borrower  having 10% or more of the book value of the consolidated assets of the Parent, Borrower and the  Subsidiaries as of the end of the most recent Fiscal Quarter for which Borrower has delivered  financial statements pursuant to Section 7.1(a) or (b), provided, however, the aggregate of all  wholly-owned Subsidiaries that are Domestic Subsidiaries of Borrower not considered Material  Domestic Subsidiaries herein shall not exceed at any time 20% or more of the book value of the  consolidated assets of the Parent, Borrower and its Subsidiaries as of the end of the most recent  Fiscal Quarter for which Borrower has delivered financial statements pursuant to Section 7.1(a) or  (b).  “Material Gas Imbalance” means, with respect to all Gas Balancing Agreements to which  any Credit Party is a party or by which any Oil and Gas Property owned by any Credit Party is  bound, a net gas imbalance to Borrower or any other Credit Party, individually or taken as a whole  in excess of $1,000,000.  Gas imbalances will be determined based on written agreements, if any,  specifying the method of calculation thereof, or, alternatively, if no such agreements are in  existence, gas imbalances will be calculated by multiplying (x) the volume of gas imbalance as of  the date of calculation (expressed in thousand cubic feet) by (y) the heating value in Btu’s per  thousand cubic feet, times the Henry Hub average daily spot price for the month immediately  preceding the date of calculation.  “Maximum Facility Amount” means $1,500,000,000, as such amount may be adjusted  from time to time thereafter in accordance with Section 2.11.  “Maximum Rate” has the meaning set forth in Section 13.4.  

 

  84134605.9   MRC Energy Company Credit Agreement 27  “Moody’s” means Moody’s Investors Service, Inc.  “Mortgaged Properties” means all of the right, title and interest of Borrower and the other  Credit Parties in and to those Oil and Gas Properties, whether now owned or hereafter acquired,  in which a Lien is created by any Collateral Document in favor of the Administrative Agent for  the benefit of the Secured Parties, whether executed prior to, contemporaneous with or after the  execution of this Agreement.  “Mortgages” means (a) the Existing Mortgages, and (b) all other mortgages, deeds of trust,  amendments to mortgages or deeds of trust, assignments of production, pledge agreements,  collateral mortgages, collateral chattel mortgages, collateral assignments, financing statements and  other documents, instruments and agreements evidencing, creating, perfecting or otherwise  establishing Liens in favor of the Administrative Agent for the benefit of the Secured Parties and  securing the Indebtedness pursuant to Section 4.6, Section 5.1, Section 7.12, Section 7.17 or  otherwise.  “Multiemployer Plan” means a Pension Plan which is a multiemployer plan as defined in  Section 4001(a)(3) of ERISA.  “Net Cash Proceeds” means the aggregate cash payments received by Parent or any Credit  Party from any Disposition of property, the issuance of Equity Interests or the issuance of Debt  (including the Senior Notes and any Permitted Refinancing thereof), as the case may be, net of all  costs and expenses incurred in connection with any such sale or issuance, as the case may be,  including, without limitation, legal, accounting and investment banking fees, underwriting  discounts, sales commissions, and other third party charges, and net of property taxes, transfer  taxes and all other taxes paid or payable by Parent or such Credit Party in respect of any such sale  or issuance, and, in the case of a Disposition of property, net of all amounts required to be applied  to the repayment of Debt secured by a Lien expressly permitted hereunder on any asset that is the  subject of such Disposition (other than any Lien pursuant to a Collateral Document).  “New Lender” has the meaning set forth in Section 13.22.  “Non-Compliant Lender” shall have the meaning set forth in Section 13.11(b).  “Non-Defaulting Lender” means any Lender that is not, as of the date of relevance, a  Defaulting Lender.  “Notes” means the Revolving Credit Notes.  “OFAC” means the Office of Foreign Assets Control of the United States Department of  the Treasury.  “Oil and Gas Properties” means the Hydrocarbon Interests; the properties now or hereafter  pooled or unitized with the Hydrocarbon Interests; all presently existing or future unitization,  pooling agreements and declarations of pooled units and the units created thereby (including  without limitation all units created under orders, regulations and rules of any Governmental  Authority) which may affect all or any portion of the Hydrocarbon Interests; all operating  agreements, contracts and other agreements which relate to any of the Hydrocarbon Interests or  

 

  84134605.9   MRC Energy Company Credit Agreement 28  the production, sale, purchase, exchange or processing of Hydrocarbons from or attributable to  such Hydrocarbon Interests; all Hydrocarbons in and under and which may be produced and saved  or attributable to the Hydrocarbon Interests, including all oil in tanks, the lands covered thereby  and all rents, issues, profits, proceeds, products, revenues and other incomes from or attributable  to the Hydrocarbon Interests; all tenements, hereditaments, appurtenances and properties in any  manner appertaining, belonging, affixed or incidental to the Hydrocarbon Interests; and all  properties, rights, titles, interests and estates described or referred to above, including any and all  property, real or personal, now owned or hereinafter acquired and situated upon, used, held for use  or useful in connection with the operating, working or development of any of such Hydrocarbon  Interests or property (excluding drilling rigs, automotive equipment or other personal property  which may be on such premises for the purpose of drilling a well or for other similar temporary  uses) and including any and all oil wells, gas wells, injection wells or other wells, buildings,  structures, fuel separators, liquid extraction plants, plant compressors, pumps, pumping units, field  gathering systems, tanks and tank batteries, fixtures, valves, fittings, machinery and parts, engines,  boilers, meters, apparatus, equipment, appliances, tools, implements, cables, wires, towers, casing,  tubing and rods, surface leases, rights-of-way, easements and servitudes together with all  additions, substitutions, replacements, accessions and attachments to any and all of the foregoing.  “Order” has the meaning set forth in Section 7.4(d).  “Organizational Documents” means (a) with respect to any corporation, the certificate or  articles of incorporation and the bylaws; (b) with respect to any limited liability company, the  certificate or articles of formation or organization and operating agreement; and (c) with respect  to any partnership, joint venture, trust or other form of business entity, the partnership, joint  venture or other applicable agreement of formation or organization and any agreement, instrument,  filing or notice with respect thereto filed in connection with its formation or organization with the  applicable Governmental Authority in the jurisdiction of its formation or organization and, if  applicable, any certificate or articles of formation or organization of such entity.  “Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as a result  of a present or former connection between such Recipient and the jurisdiction imposing such Tax  (other than connections arising from such Recipient having executed, delivered, become a party  to, performed its obligations under, received payments under, received or perfected a security  interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or  sold or assigned an interest in any Advance or Loan Document).  “Other Taxes” means all present or future stamp, court or documentary, intangible,  recording, filing or similar Taxes that arise from any payment made under, from the execution,  delivery, performance, enforcement or registration of, from the receipt or perfection of a security  interest under, or otherwise with respect to, any Loan Document.  “Parent” means Matador Resources Company, a Texas corporation.  “Participant” has the meaning set forth in Section 13.7(d).  “Participant Register” has the meaning set forth  in Section 13.7(d).  “PBGC” means the Pension Benefit Guaranty Corporation or any successor thereto.  

 

  84134605.9   MRC Energy Company Credit Agreement 29  “Pension Plan” means any plan established and maintained by the Parent or a Credit Party,  or contributed to by the Parent or a Credit Party, which is qualified under Section 401(a) of the  Internal Revenue Code and subject to the minimum funding standards of Section 412 of the  Internal Revenue Code.  “Permitted Encumbrances” means with respect to any Person:  (a) Liens imposed by law for taxes, assessments or other governmental charges  or levies which are not yet delinquent or which (i) are being contested in good faith by  appropriate proceedings, (ii) the relevant Credit Party has set aside on its books adequate  reserves with respect thereto in accordance with GAAP, and (iii) the failure to make  payment pending such contest would not have a Material Adverse Effect;  (b) vendors’, carriers’, warehousemen’s, mechanics’, materialmen’s,  repairmen’s and other like Liens imposed by law, and contractual Liens granted to  operators and non-operators under oil and gas operating agreements, in each case, arising  in the ordinary course of business or incident to the exploration, development, operation  and maintenance of Oil and Gas Properties and securing obligations that are not overdue  by more than 60 days or which (i) are being contested in good faith by appropriate  proceedings, (ii) the relevant Credit Party has set aside on its books adequate reserves with  respect thereto in accordance with GAAP, and (iii) the failure to make payment pending  such contest would not have a Material Adverse Effect;  (c) contractual Liens which arise in the ordinary course of business under  operating agreements, oil and gas partnership and joint venture agreements, oil and gas  leases, farm-out agreements, division orders, contracts for the sale, transportation or  exchange of oil and natural gas, unitization and pooling declarations and agreements, area  of mutual interest agreements, overriding royalty agreements, marketing agreements,  processing agreements, net profits agreements, development agreements, gas balancing or  deferred production agreements, injection, repressuring and recycling agreements, salt  water or other disposal agreements, seismic or other geophysical permits or agreements,  and other agreements which are usual and customary in the oil and gas business;  (d) Liens in connection with workmen’s compensation, unemployment  insurance or other social security, old age, pension or public liability obligations;  (e) Liens on cash, Cash Equivalents, securities and deposits to secure the  performance of bids, trade contracts, leases, statutory obligations, surety and appeal bonds,  performance bonds and other obligations of a like nature, in each case in the ordinary  course of business;  (f) bankers liens and rights of set-off with respect to customary depositary  arrangements entered into in the ordinary course of business;   (g) judgment liens in respect of judgments that do not constitute an Event of  Default under Section 9.1(h);  

 

  84134605.9   MRC Energy Company Credit Agreement 30  (h) easements, zoning restrictions, rights-of-way, servitudes, permits, surface  leases, and similar encumbrances on real property imposed by law or arising in the ordinary  course of business that, in the aggregate, do not materially detract from the value of the  affected property or interfere with the ordinary conduct of business of the Credit Parties;  (i) royalties, overriding royalties, reversionary interests, calls on production,  preferential purchase rights, net profits interests, production payments and other similar  burdens with respect to the Oil and Gas Properties owned by the Credit Parties if the net  cumulative effect of such burdens does not operate to deprive any Credit Party of any  material right in respect of its assets or properties (except for rights customarily granted  with respect to such interests);  (j) Liens arising from Uniform Commercial Code financing statement filings  regarding operating leases entered into by Borrower or any Restricted Subsidiary in the  ordinary course of business covering the property under the lease and not securing any  Debt;  (k) unperfected Liens reserved in leases (other than oil and gas leases) or  arising by operation of law for rent or compliance with the lease in the case of leasehold  estates;  (l) environmental Liens which are being contested in good faith by appropriate  proceedings and which do not and cannot rank in priority above the Liens created under  the Collateral Documents; and  (m) Immaterial Title Deficiencies.  Notwithstanding the foregoing, regardless of the language set forth in this definition, no  Lien over the Equity Interests of any Restricted Subsidiary granted to any Person other than to  Administrative Agent for the benefit of the Secured Parties shall be deemed a “Permitted  Encumbrance” under the terms of this Agreement.  “Permitted Refinancing” means any (1) Debt of Parent or any Credit Party, and Debt  constituting guarantees thereof by any Credit Party, incurred or issued in exchange for, or the Net  Cash Proceeds of which are used to extend, refinance, renew, replace, repurchase, defease or  refund, existing Senior Notes, in whole or in part, from time to time; provided that (a) the principal  amount of such Permitted Refinancing (or if such Permitted Refinancing is issued at a discount,  the initial issuance price of such Permitted Refinancing) does not exceed the principal amount of  Debt permitted under Section 8.1(q), (b) such Permitted Refinancing does not provide for any  scheduled repayment, mandatory redemption or payment of a sinking fund obligation prior to the  date that is six (6) months after the Revolving Credit Maturity Date (except for any offer to redeem  such Debt required as a result of asset sales or the occurrence of a “Change of Control” (or any  other defined term having a similar purpose) under and as defined in the Indenture), (c)  the  covenant, default and remedy provisions of such Permitted Refinancing are not materially more  onerous, taken as a whole, to the Borrower and its Subsidiaries than those imposed by such existing  Senior Notes (as determined in good faith by the board of directors of the Parent or a committee  thereof), (d) the mandatory prepayment, repurchase and redemption provisions of such Permitted  

 

  84134605.9   MRC Energy Company Credit Agreement 31  Refinancing are not materially more onerous, taken as a whole, to the Borrower and its Subsidiaries  than those imposed by such existing Senior Notes (as determined in good faith by the board of  directors of the Parent or a committee thereof), (e) such Permitted Refinancing is unsecured, (f)  no Subsidiary of any Credit Party is required to guarantee such Permitted Refinancing unless such  Subsidiary is (or concurrently with any such guarantee becomes) a Guarantor hereunder, and (g)  to the extent such Permitted Refinancing is or is intended to be expressly subordinate to the  payment in full of all or any portion of the Indebtedness, the subordination provisions contained  therein are either (x) on substantially the same terms or at least as favorable to the Lenders as the  subordination provisions contained in such existing Senior Notes or (y) reasonably satisfactory to  the Administrative Agent and (2) any Senior Notes registered with the SEC and issued in exchange  for the initial Senior Notes issued by the Parent and any guarantees thereof by any Credit Party.  “Person” means a natural person, corporation, limited liability company, partnership,  limited liability partnership, trust, incorporated or unincorporated organization, joint venture, joint  stock company, firm or association or a government or any agency or political subdivision thereof  or other entity of any kind.  “Platform” has the meaning set forth in the last paragraph of Section 7.1.  “Pledge Agreement” means the Third Amended and Restated Pledge and Security  Agreement to be executed and delivered by the Credit Parties as of November 18, 2021.  “Prime Rate” means the per annum rate of interest announced by RBC, at its main office  from time to time as its “prime rate” (it being acknowledged that such announced rate may not  necessarily be the lowest rate charged by RBC to any of its customers), which Prime Rate shall  change simultaneously with any change in such announced rate.  “Public Lenders” shall have the meaning set forth in the last paragraph of Section 7.1.  “Purchases” has the meaning set forth in Section 8.5.  “Purchasing Lender” shall have the meaning set forth in Section 13.11(a).  “QFC” shall have the meaning set forth in Section 13.25(b).  “QFC Credit Support” shall have the meaning set forth in Section 13.25.  “Rating Agency” means Moody’s, S&P, their respective successors or any other nationally  recognized statistical rating organization which is acceptable to Administrative Agent.  “RBC” means Royal Bank of Canada, and its successors or assigns in accordance with the  terms of this Agreement.  “Recipient” means (a) the Administrative Agent, (b) any Lender and (c) any Issuing  Lender, as applicable.  “Reference Time” with respect to any setting of the then-current Benchmark means (1) if  such Benchmark is USD LIBOR, 11:00 a.m. (London time) on the day that is two London banking  

 

  84134605.9   MRC Energy Company Credit Agreement 32  days preceding the date of such setting, and (2) if such Benchmark is not USD LIBOR, the time  determined by Administrative Agent in its reasonable discretion.  “Register” has the meaning set forth in Section 13.7(c).  “Reimbursement Obligation(s)” means the aggregate amount of all unreimbursed drawings  under all Letters of Credit (excluding for the avoidance of doubt, reimbursement obligations that  are deemed satisfied pursuant to a deemed disbursement under Section 3.6(c)).  “Related Parties” means, with respect to any Person, such Person’s Affiliates and the  partners, directors, officers, employees, agents, trustees, administrators, managers, advisors and  representatives of such Person and of such Person’s Affiliates.  “Relevant Governmental Body” means the Board of Governors of the Federal Reserve  System or the Federal Reserve Bank of New York, or a committee officially endorsed or convened  by the Board of Governors of the Federal Reserve System or the Federal Reserve Bank of New  York, or any successor thereto.  “Reported Month” is defined in Section 7.2(e).  “Request for Revolving Credit Advance” means a request for a Revolving Credit Advance  issued by Borrower under Section 2.3 of this Agreement in the form attached hereto as Exhibit A,  or in such other form acceptable to the Administrative Agent.  “Requirement of Law” means as to any Person, any law, treaty, rule or regulation or  determination of an arbitration or a court or other Governmental Authority, in each case applicable  to or binding upon such Person or any of its property or to which such Person or any of its property  is subject.  “Reserve Report” means a report in form reasonably satisfactory to Administrative Agent  evaluating the oil and gas reserves attributable to Hydrocarbon Interests of the Credit Parties in all  of their Oil and Gas Properties and which shall, among other things, (a) identify the wells covered  thereby, (b) specify such engineers’ opinions with respect to the total volume of proved reserves  of Hydrocarbons (using the terms or categories “proved developed producing reserves,” “proved  developed nonproducing reserves” and “proved undeveloped reserves”) which Borrower has  advised such engineers that the Credit Parties have the right to produce for their own account,  (c) set forth such engineers’ opinions with respect to the projected future cash proceeds from the  proved reserves, discounted for present value at a rate reasonably acceptable to Administrative  Agent, for each calendar year or portion thereof after the date of such findings and data, (d) set  forth such engineers’ opinions with respect to the projected future rate of production from the  proved reserves, (e) contain such other information as may be reasonably requested by  Administrative Agent with respect to the projected rate of production, gross revenues, operating  expenses, taxes, capital costs, net revenues and present value of future net revenues attributable to  such proved reserves and production therefrom, and (f) contain a statement of the price and  escalation parameters, procedures and assumptions upon which such determinations were based.  “Resolution Authority” means an EEA Resolution Authority or, with respect to any UK  Financial Institution, a UK Resolution Authority.  

 

  84134605.9   MRC Energy Company Credit Agreement 33  “Responsible Officer” means the chief executive officer, president, chief financial officer  or any executive vice president of Borrower.  “Restricted Payments” has the meaning set forth in Section 8.5.  “Restricted Subsidiary” means, on any date of determination, (a) any Subsidiary  that is a  Material Domestic Subsidiary and (b) any Subsidiary that owns or operates Borrowing Base  Properties.  “Revolving Credit” means the Revolving Credit Advances to be advanced to Borrower by  the applicable Revolving Credit Lenders, in an aggregate amount (subject to the terms hereof), not  to exceed, at any one time outstanding, the Revolving Credit Aggregate Commitment.  “Revolving Credit Advance” means a borrowing requested by Borrower and made by the  Revolving Credit Lenders under Section 2.1 of this Agreement, including without limitation any  readvance, refunding or conversion of such borrowing pursuant to Section 2.3 and any deemed  disbursement of an Advance in respect of a Letter of Credit under Section 3.6(c), and may include,  subject to the terms hereof, Eurodollar-based Advances and Base Rate Advances.  “Revolving Credit Aggregate Commitment” means, on any date of determination, the least  of the aggregate Revolving Credit Commitment Amounts, the Maximum Facility Amount and the  Borrowing Base on such date, subject to reduction or termination under Section 2.11 or Section  9.2 and redetermination or adjustments under Article 4, Section 7.16 or Section 8.4(k).  “Revolving Credit Commitment Amount” means with respect to any Revolving Credit  Lender, (a) if the Revolving Credit Aggregate Commitment has not been terminated, the amount  specified opposite such Revolving Credit Lender’s name in the column entitled “Revolving Credit  Allocations” on Schedule 1.2, as adjusted from time to time in accordance with the terms hereof;  and (b) if the Revolving Credit Aggregate Commitment has been terminated (whether by maturity,  acceleration or otherwise), the amount equal to its Revolving Credit Percentage of the Aggregate  Credit Exposure.   “Revolving Credit Lenders” means the financial institutions from time to time parties  hereto as lenders of the Revolving Credit.  “Revolving Credit Maturity Date” means, at any time a determination is to be made, the  earlier of (i) the date that is one hundred eighty (180) days prior to the earliest stated redemption  date of any series of Senior Notes having an aggregate principal amount in excess of $25,000,000,  or (ii) October 31, 2026.  “Revolving Credit Notes” means the revolving credit notes described in Section 2.2, made  by Borrower to each of the Revolving Credit Lenders in the form attached hereto as Exhibit B, as  such notes may be amended or supplemented from time to time, and any other notes issued in  substitution, replacement or renewal thereof from time to time.  “Revolving Credit Percentage” means, with respect to any Revolving Credit Lender, the  percentage specified opposite such Revolving Credit Lender’s name in the column entitled  

 

  84134605.9   MRC Energy Company Credit Agreement 34  “Revolving Credit Percentage” on Schedule 1.2, as adjusted from time to time in accordance with  the terms hereof.  “Sanction(s)” means any international economic sanction administered or enforced by  OFAC, the United Nations Security Council, the European Union, Her Majesty’s Treasury or other  relevant sanctions authority.  “S&P” means Standard & Poor’s Rating Services.  “SEC” means the Securities and Exchange Commission of the United States.  “Secured Party” means each of the Administrative Agent, any Lender, any Lender  Counterparty, or any Affiliate of any Lender to which any Indebtedness is owed, including any  Lender Hedging Obligations and Lender Product Obligations, provided, however, that a Lender  Counterparty and Lenders and Affiliates of Lenders to whom Lender Product Obligations or  Lender Hedging Obligations are owed shall be a Secured Party (a) in the case of Lender Product  Obligations, only while such Person (or, in the case of an Affiliate of a Lender, such Lender) is a  Lender under this Agreement and (b) in the case of Lender Hedging Obligations, only with respect  to obligations arising from transactions and confirmations entered into under Commodity Hedging  Agreements and Interest Rate Agreements at any time such Person (or, in the case of an Affiliate  of a Lender, such Lender) is a Lender under this Agreement.  “Senior Notes” means any senior or senior subordinated notes issued by Parent or any  Credit Party pursuant to and in accordance with the terms of the applicable Indenture; provided  that (a) the terms of such Senior Notes do not provide for any scheduled repayment, mandatory  redemption (including any required offer to redeem) or payment of a sinking fund obligation prior  to the date that is six (6) months after the Revolving Credit Maturity Date (except for any offer to  redeem such Senior Notes required as a result of asset sales or the occurrence of a “Change of  Control” (or any other defined term having a similar purpose) under and as defined in the  applicable Indenture), (b) such Senior Notes are unsecured and (c) no Subsidiary of any Credit  Party is required to guarantee the Debt evidenced by such Senior Notes unless such Subsidiary is  (or concurrently with any such guarantee becomes) a Guarantor hereunder.  “Senior Note Documents” means the Senior Notes, the Indenture and any documents or  instruments executed in connection with any of them, in each case, as amended, restated,  supplemented or otherwise modified from time to time to the extent not prohibited by this  Agreement.  “SOFR” means, with respect to any Business Day, a rate per annum equal to the secured  overnight financing rate for such Business Day published by the SOFR Administrator on the SOFR  Administrator’s Website on the immediately succeeding Business Day.  “SOFR Administrator” means the Federal Reserve Bank of New York (or a successor  administrator of the secured overnight financing rate).  “SOFR Administrator’s Website” means the website of the Federal Reserve Bank of New  York, currently at http://www.newyorkfed.org, or any successor source for the secured overnight  financing rate identified as such by the SOFR Administrator from time to time.  

 

  84134605.9   MRC Energy Company Credit Agreement 35  “Subsidiary” means any other corporation, association, joint stock company, business trust,  limited liability company, partnership or any other business entity of which more than 50% of the  outstanding voting stock, share capital, membership, partnership or other interests, as the case may  be, is owned either directly or indirectly by any Person or one or more of its Subsidiaries, or the  management of which is otherwise controlled, directly, or indirectly through one or more  intermediaries, or both, by any Person and/or its Subsidiaries.  Unless otherwise specified to the  contrary herein or the context otherwise requires, Subsidiary shall refer to a Subsidiary of  Borrower.  “Successor Administrative Agent” has the meaning ascribed to such term in Section 12.4.  “Supermajority Lenders” means at any time, the Revolving Credit Lenders holding at least  66-2/3% of the Revolving Credit Aggregate Commitment (or, if the Revolving Credit Aggregate  Commitment has been terminated (whether by maturity, acceleration or otherwise), the aggregate  principal amount outstanding under the Revolving Credit); provided that, for purposes of  determining Supermajority Lenders hereunder, the Letter of Credit Obligations shall be allocated  among the Revolving Credit Lenders based on their respective Revolving Credit Percentages.  The  Revolving Credit Commitment Amount of, and portion of the Aggregate Credit Exposure  attributable to, any Defaulting Lender shall be excluded for purposes of making a determination  of “Supermajority Lenders”.  “Supported QFC” shall have the meaning set forth in Section 13.25.  “Swap Obligation” means, with respect to any Guarantor, any obligation to pay or perform  under any agreement, contract or transaction that constitutes a “swap” within the meaning of  section 1a(47) of the Commodity Exchange Act.  “Taxes” means all present or future taxes, levies, imposts, duties, deductions, withholdings  (including backup withholding), assessments, fees or other charges imposed by any Governmental  Authority, including any interest, additions to tax or penalties applicable thereto.  “Term SOFR” means, for the applicable Corresponding Tenor as of the applicable  Reference Time, the forward-looking term rate based on SOFR that has been selected or  recommended by the Relevant Governmental Body.  “Term SOFR Notice” means a notification by Administrative Agent to the Lenders and  Borrower of the occurrence of a Term SOFR Transition Event.  “Term SOFR Transition Event” means the determination by Administrative Agent that  (a) Term SOFR has been recommended for use by the Relevant Governmental Body, and is  determinable for each Available Tenor, (b) the administration of Term SOFR is administratively  feasible for Administrative Agent and (c) a Benchmark Transition Event has previously occurred  resulting in a Benchmark Replacement in accordance with Section 11.3 that is not Term SOFR.  “Test Period” means, at any time, the four consecutive Fiscal Quarters of Borrower then  last ended (in each case taken as one accounting period) for which financial statements have been  or are required to be delivered pursuant to this Agreement.  

 

  84134605.9   MRC Energy Company Credit Agreement 36  “Threshold Amount” means, at any time, an amount equal to the greater of (a) $50,000,000  and (b) 5% of the Borrowing Base.  “Total Debt to Consolidated EBITDA Ratio” means, for any Test Period, the ratio of (a)  the amount equal to (i) total Debt of the Parent and its Subsidiaries (other than Unrestricted  Subsidiaries) as of the last day of such Test Period minus (ii) unrestricted cash and cash equivalents  of  the Parent and its Subsidiaries (other than Unrestricted Subsidiaries) as of the last day of such  Test Period, provided that, for purposes of this clause (ii), the aggregate amount of cash and Cash  Equivalents shall not exceed $75,000,000, to (b) Consolidated EBITDA of the Parent and its  Subsidiaries (other than Unrestricted Subsidiaries) for such Test Period.  “Uniform Commercial Code” or “UCC” means the Uniform Commercial Code as in effect  in any applicable state; provided that, unless specified otherwise or the context otherwise requires,  such terms shall refer to the Uniform Commercial Code as in effect in the State of Texas.  “UK Financial Institution” means any BRRD Undertaking (as such term is defined under  the PRA Rulebook (as amended form time to time) promulgated by the United Kingdom Prudential  Regulation Authority) or any person falling within IFPRU 11.6 of the FCA Handbook (as amended  from time to time) promulgated by the United Kingdom Financial Conduct Authority, which  includes certain credit institutions and investment firms, and certain affiliates of such credit  institutions or investment firms.  “UK Resolution Authority” means the Bank of England or any other public administrative  authority having responsibility for the resolution of any UK Financial Institution.  “Unadjusted Benchmark Replacement” means the applicable Benchmark Replacement  excluding the related Benchmark Replacement Adjustment.  “Unrestricted Subsidiary” means (i) as of the Effective Date, any Subsidiary listed as an  “Unrestricted Subsidiary” on Schedule 6.15 hereto and (ii)  any Subsidiary that at the time of the  determination shall be designated an Unrestricted Subsidiary of Borrower in a manner provided  below.  Borrower may designate any Subsidiary (including any newly acquired or newly formed  Subsidiary) to be an Unrestricted Subsidiary unless such Subsidiary or any of its Subsidiaries at  the time of such designation or at any time thereafter (a) is a Material Domestic Subsidiary, (b)  owns or operates Borrowing Base Properties or (c) is a guarantor or the primary obligor with  respect to any indebtedness, liabilities or other obligations under any Senior Notes (or any  Permitted Refinancing thereof).  “Unused Revolving Credit Availability” means, on any date of determination, the amount  equal to the positive difference (if any) between (a) the Revolving Credit Aggregate Commitment  minus (b) the Aggregate Credit Exposure.  “U.S. Person” means any Person that is a “United States person” as defined in Section  7701(a)(30) of the Internal Revenue Code.  “U.S. Tax Compliance Certificate” has the meaning set forth in Section 11.9(g)(ii)(C).  

 

  84134605.9   MRC Energy Company Credit Agreement 37  “USA Patriot Act” means the USA PATRIOT Act, Title III of Pub. L. 107-56 (signed into  law October 26, 2001).  “U.S. Special Resolution Regimes” shall have the meaning set forth in Section 13.25.  “USD LIBOR” means the London interbank offered rate for U.S. dollars.  “Withdrawal Liability” means liability to a Multiemployer Plan as a result of a complete  or partial withdrawal from such Multiemployer Plan, as such terms are defined in Part I of  Subtitle E of Title IV of ERISA.  “Withdrawing Lender” means any Person who (a) is a Lender under the Existing Credit  Agreement immediately prior to the Effective Date but is not a Lender under this Agreement and  (b) is identified on Schedule 6.22(b) hereto.  “Withdrawing Lender Commodity Hedging Agreements” means, to the extent constituting  “Lender Hedging Obligations” under the Existing Credit Agreement, the Existing Commodity  Hedging Agreements set forth on Schedule 6.22(c).  “Withholding Agent” means any Credit Party and the Administrative Agent.  “Write-Down and Conversion Powers” means, (a) with respect to any EEA Resolution  Authority, the write-down and conversion powers of such EEA Resolution Authority from time to  time under the Bail-In Legislation for the applicable EEA Member Country, which write-down  and conversion powers are described in the EU Bail-In Legislation Schedule, and (b) with respect  to the United Kingdom,  any powers of the applicable Resolution Authority  under the Bail-In  Legislation to cancel, reduce, modify or change the form of a liability of any UK Financial  Institution  or any contract or instrument under which that liability arises, to convert all or part of  that liability into shares, securities or obligations of that person or any other person, to provide that  any such contract or instrument is to have effect as if a right had been exercised under it or to  suspend any obligation in respect of that liability or any of the powers under that Bail-In  Legislation that are related to or ancillary to any of those powers.  1.2 Terms, Generally.  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 (a) any definition of or reference to any agreement,  instrument or other document herein shall be construed as referring to such agreement, instrument  or other document as from time to time amended, restated, supplemented or otherwise modified  (subject to any restrictions on such amendments, restatements, supplements or modifications set  forth herein), (b) any reference herein to any Person shall be construed to include such Person’s  successors and assigns, (c) the words “herein”, “hereof” and “hereunder”, and words of similar  import, shall be construed to refer to this Agreement in its entirety and not to any particular  provision hereof, (d) all references herein to Sections, Exhibits and Schedules shall be construed  to refer to Sections of, and Exhibits and Schedules to, this Agreement and (e) the words “asset”  and “property” shall be construed to have the same meaning and effect and to refer to any and all  

 

  84134605.9   MRC Energy Company Credit Agreement 38  tangible and intangible assets and properties, including cash, securities, accounts and contract  rights.  1.3 Oil and Gas Definitions.  For purposes of this Agreement, the terms “proved  reserves,” “proved developed reserves,” “proved undeveloped reserves,” “proved developed  nonproducing reserves” and “proved developed producing reserves,” have the meaning given such  terms from time to time and at the time in question by the Society of Petroleum Engineers of the  American Institute of Mining Engineers.  1.4 Divisions.  For all purposes under the Loan Documents, in connection with any  division or plan of division under Delaware law (or any comparable event under a different  jurisdiction’s laws): (a) if any asset, right, obligation or liability of any Person becomes the asset,  right, obligation or liability of a different Person, then it shall be deemed to have been transferred  from the original Person to the subsequent Person, and (b) if any new Person comes into existence,  such new Person shall be deemed to have been organized on the first date of its existence by the  holders of its Equity Interests at such time.  ARTICLE 2. REVOLVING CREDIT.  2.1 Commitment.  Subject to the terms and conditions of this Agreement (including  without limitation Section 2.3), each Revolving Credit Lender severally and for itself alone agrees  to make Advances of the Revolving Credit in Dollars to Borrower from time to time on any  Business Day during the period from the Effective Date hereof until (but excluding) the Revolving  Credit Maturity Date in an aggregate principal amount that will not result in (a) such Lender’s  Credit Exposure exceeding such Lender’s Revolving Credit Commitment Amount or (b) the  Aggregate Credit Exposure exceeding the Revolving Credit Aggregate Commitment.  Subject to  the terms and conditions set forth herein, advances, repayments and readvances may be made under  the Revolving Credit.  2.2 Accrual of Interest and Maturity; Evidence of Indebtedness.  (a) Borrower hereby unconditionally promises to pay to Administrative Agent  for the account of each Revolving Credit Lender the then unpaid principal amount of each  Revolving Credit Advance (plus all accrued and unpaid interest) of such Revolving Credit  Lender to Borrower on the Revolving Credit Maturity Date and on such other dates and in  such other amounts as may be required from time to time pursuant to this Agreement.   Subject to the terms and conditions hereof, each Revolving Credit Advance shall, from  time to time from and after the date of such Advance (until paid), bear interest at its  Applicable Interest Rate.  (b) Each Revolving Credit Lender shall maintain in accordance with its usual  practice an account or accounts evidencing indebtedness of Borrower to the appropriate  lending office of such Revolving Credit Lender resulting from each Revolving Credit  Advance made by such lending office of such Revolving Credit Lender from time to time,  including the amounts of principal and interest payable thereon and paid to such Revolving  Credit Lender from time to time under this Agreement.  

 

  84134605.9   MRC Energy Company Credit Agreement 39  (c) The Register shall be maintained pursuant to Section 13.7(g), and a  subaccount therein for each Revolving Credit Lender, in which Register and subaccounts  (taken together) shall be recorded (i) the amount of each Revolving Credit Advance made  hereunder, the type thereof and each Eurodollar-Interest Period applicable to any  Eurodollar-based Advance, (ii) the amount of any principal or interest due and payable or  to become due and payable from Borrower to each Revolving Credit Lender hereunder in  respect of the Revolving Credit Advances and (iii) both the amount of any sum received  by Administrative Agent hereunder from Borrower in respect of the Revolving Credit  Advances and each Revolving Credit Lender’s share thereof.  (d) The entries made in the Register maintained pursuant to paragraph (c) of  this Section 2.2 shall, absent manifest error, to the extent permitted by applicable law, be  prima facie evidence of the existence and amounts of the obligations of Borrower therein  recorded; provided, however, that the failure of any Revolving Credit Lender or  Administrative Agent to maintain the Register or any account, as applicable, or any error  therein, shall not in any manner affect the obligation of Borrower to repay the Revolving  Credit Advances (and all other amounts owing with respect thereto) made to Borrower by  the Revolving Credit Lenders in accordance with the terms of this Agreement.  (e) Borrower agrees that, upon written request to Administrative Agent by any  Revolving Credit Lender, Borrower will execute and deliver, to such Revolving Credit  Lender, at Borrower’s own expense, a Revolving Credit Note evidencing the outstanding  Revolving Credit Advances owing to such Revolving Credit Lender, with appropriate  insertions as to date and principal amount.  2.3 Requests for Advances and for Continuations and Conversions of Advances.   Borrower may request an Advance of the Revolving Credit, a continuation of any Revolving Credit  Advance in the same type of Advance or to convert any Revolving Credit Advance to any other  type of Revolving Credit Advance only by delivery to Administrative Agent of a Request for  Revolving Credit Advance executed by a Responsible Officer for Borrower, subject to the  following:  (a) each such Request for Revolving Credit Advance shall set forth the  information required on the Request for Revolving Credit Advance, including without  limitation:  (i) the proposed date of such Revolving Credit Advance (or the  continuation or conversion date of an outstanding Revolving Credit Advance),  which must be a Business Day;  (ii) whether such Advance is a new Revolving Credit Advance or a  continuation or conversion of an outstanding Revolving Credit Advance;   (iii) whether such Revolving Credit Advance is to be a Base Rate  Advance or a Eurodollar-based Advance, and, except in the case of a Base Rate  Advance, the first Eurodollar-Interest Period applicable thereto; and  

 

  84134605.9   MRC Energy Company Credit Agreement 40  (iv) solely with respect to any Request for Revolving Credit Advance  not delivered to Administrative Agent by 12:00 p.m. (New York time) two (2)  Business Days prior to the proposed date of the Revolving Credit Advance (but not,  for avoidance of doubt any continuation or conversion of Revolving Credit  Advances), the Consolidated Cash Balance (without regard to the requested  Revolving Credit Advance) and the pro forma Consolidated Cash Balance (giving  effect to the requested Revolving Credit Advance and any other transactions  occurring prior to, or substantially simultaneously with, such Advance);  (b) each such Request for Revolving Credit Advance (including without  limitation any request for Advances to be made on the Effective Date) shall be delivered  to Administrative Agent by 12:00 p.m. (New York time)  three (3) Business Days prior to  the proposed date of the Revolving Credit Advance, except in the case of a Base Rate  Advance, for which the Request for Revolving Credit Advance must be delivered by 12:00  p.m. (New York time) one (1) Business Day prior to the proposed date for such Revolving  Credit Advance;  (c) on the proposed date of the borrowing of such Revolving Credit Advance,  after giving effect to all borrowings and repayments on such date, the Aggregate Credit  Exposure shall not exceed the Revolving Credit Aggregate Commitment;  (d) in the case of a Base Rate Advance, the principal amount of the initial  funding of such Advance, as opposed to any continuation or conversion thereof, shall be at  least $1,000,000 or the remainder available under the Revolving Credit Aggregate  Commitment if less than $1,000,000;  (e) in the case of a Eurodollar-based Advance, the principal amount of such  Advance, plus the amount of any other outstanding Revolving Credit Advance to be then  combined therewith having the same Eurodollar-Interest Period, if any, shall be at least  $1,500,000 (or a larger integral multiple of $100,000) or the remainder available under the  Revolving Credit Aggregate Commitment if less than $1,500,000 and at any one time there  shall not be in effect more than ten (10) different Eurodollar-Interest Periods;  (f) each such Request for Revolving Credit Advance, once delivered to  Administrative Agent, shall not be revocable by Borrower and shall constitute a  certification by Borrower that, as of the date of borrowing of the requested Advance,  (i) each of the conditions set forth in Section 5.2 will be satisfied and (ii) with respect to  any Revolving Credit Advance made pursuant to Section 2.1 (but not, for avoidance of  doubt any continuation or conversion of Revolving Credit Advances), the Consolidated  Cash Balance after giving pro forma effect to the requested Revolving Credit Advance and  any other transactions occurring prior to, or substantially simultaneously with, such  Advance, shall not exceed the Consolidated Cash Balance Threshold; and  (g) any Revolving Credit Advances to be made on the Effective Date pursuant  to a Request for Revolving Credit Advance shall be Base Rate Advances;  

 

  84134605.9   MRC Energy Company Credit Agreement 41  Administrative Agent, acting on behalf of the Revolving Credit Lenders, may also, at its option,  lend under this Section 2.3 upon the telephone or email request of a Responsible Officer of  Borrower and, in the event Administrative Agent, acting on behalf of the Revolving Credit  Lenders, makes any such Advance upon a telephone or email request, a Responsible Officer shall  fax or send by email to Administrative Agent, on the same day as such telephone or email request,  an executed Request for Revolving Credit Advance.  Borrower hereby authorizes Administrative  Agent to disburse Advances under this Section 2.3 pursuant to the telephone or email instructions  of any person purporting to be a Responsible Officer.  Notwithstanding the foregoing, Borrower  acknowledges that Borrower shall bear all risk of loss resulting from disbursements made upon  any telephone or email request.  Each telephone or email request for an Advance from a  Responsible Officer shall constitute a certification of the matters set forth in Section 5.2.  2.4 Disbursement of Advances.  (a) Upon receiving any Request for Revolving Credit Advance in accordance  with the terms of Section 2.3, Administrative Agent shall promptly notify each Revolving  Credit Lender by wire, telex or telephone (confirmed by wire, telecopy or telex) of the  amount of such Advance being requested and the date such Advance is to be made by each  Revolving Credit Lender in an amount equal to its Revolving Credit Percentage of such  Advance.  Unless such Revolving Credit Lender’s commitment to make Revolving Credit  Advances hereunder shall have been suspended or terminated in accordance with this  Agreement, each such Revolving Credit Lender shall make available the amount of its  Revolving Credit Percentage of each Revolving Credit Advance in immediately available  funds by 1:00 p.m. (New York time) on the date of such Revolving Credit Advance to the  account of Administrative Agent most recently designated by it for such purpose by notice  to the Lenders.    (b) Subject to receipt by the Administrative Agent of an executed Request for  Revolving Credit Advance from a Responsible Officer, Administrative Agent shall make  available to Borrower the aggregate of the amounts so received by it from the Revolving  Credit Lenders in like funds and currencies not later than 4:00 p.m. (New York time) on  the date of such Revolving Credit Advance, by credit to an account of Borrower maintained  with Administrative Agent or to such other account or third party as Borrower may  reasonably direct in writing, provided that such direction is timely given.  (c) Unless Administrative Agent shall have been notified by any Revolving  Credit Lender prior to the date of any proposed Revolving Credit Advance that such  Revolving Credit Lender does not intend to make available to Administrative Agent such  Revolving Credit Lender’s Revolving Credit Percentage of such Advance, Administrative  Agent may assume that such Revolving Credit Lender has made such amount available to  Administrative Agent on such date, as aforesaid.  Administrative Agent may, but shall not  be obligated to, make available to Borrower the amount of such payment in reliance on  such assumption.  If such amount is not in fact made available to Administrative Agent by  such Revolving Credit Lender, as aforesaid, Administrative Agent shall be entitled to  recover such amount on demand from such Revolving Credit Lender.  If such Revolving  Credit Lender does not pay such amount forthwith upon Administrative Agent’s demand  therefor and Administrative Agent has in fact made a corresponding amount available to  

 

  84134605.9   MRC Energy Company Credit Agreement 42  Borrower, Administrative Agent shall promptly notify Borrower and Borrower shall pay  such amount to Administrative Agent, if such notice is delivered to Borrower prior to 1:00  p.m. (New York time) on a Business Day, on the day such notice is received, and otherwise  on the next Business Day, and such amount paid by Borrower shall be applied as a  prepayment of the Revolving Credit (without any corresponding reduction in the Revolving  Credit Aggregate Commitment), reimbursing Administrative Agent for having funded said  amounts on behalf of such Revolving Credit Lender.  Borrower shall retain without  prejudice its claim against such Revolving Credit Lender with respect to the amounts repaid  by it to Administrative Agent and, if such Revolving Credit Lender subsequently makes  such amounts available to Administrative Agent, Administrative Agent shall promptly  make such amounts available to Borrower as a Revolving Credit Advance.  Administrative  Agent shall also be entitled to recover from such Revolving Credit Lender or Borrower, as  the case may be, but without duplication, interest on such amount in respect of each day  from the date such amount was made available by Administrative Agent to Borrower, to  the date such amount is recovered by Administrative Agent, at a rate per annum equal to:  (i) in the case of such Revolving Credit Lender, for the first two  (2) Business Days such amount remains unpaid, the Federal Funds Effective Rate,  and thereafter, at the rate of interest then applicable to such Revolving Credit  Advance; and  (ii) in the case of Borrower, the rate of interest then applicable to such  Advance of the Revolving Credit.  Until such Revolving Credit Lender has paid Administrative Agent such amount, such Revolving  Credit Lender shall have no interest in or rights with respect to such Advance for any purpose  whatsoever.  The obligation of any Revolving Credit Lender to make any Revolving Credit  Advance hereunder shall not be affected by the failure of any other Revolving Credit Lender to  make any Advance hereunder, and no Revolving Credit Lender shall have any liability to  Borrower, the Parent or any of its Subsidiaries, Administrative Agent, any other Revolving Credit  Lender, or any other party for another Revolving Credit Lender’s failure to make any loan or  Advance hereunder.  2.5 [Intentionally Omitted].  2.6 Interest Payments; Default Interest.  (a) Interest on the unpaid balance of all Base Rate Advances of the Revolving  Credit from time to time outstanding shall accrue from the date of such Advance to the date  repaid, at a per annum interest rate equal to the Base Rate, and shall be payable in  immediately available funds quarterly in arrears on the last day of each March, June,  September and December.  Whenever any payment under this Section 2.6(a) shall become  due on a day which is not a Business Day, the date for payment thereof shall be extended  to the next Business Day.  Interest accruing at the Base Rate shall be computed on the basis  of a 365 or 366, as the case may be, day year and assessed for the actual number of days  elapsed, and in such computation effect shall be given to any change in the interest rate  resulting from a change in the Base Rate on the date of such change in the Base Rate.  

 

  84134605.9   MRC Energy Company Credit Agreement 43  (b) Interest on each Eurodollar-based Advance of the Revolving Credit shall  accrue at its Eurodollar-based Rate and shall be payable in immediately available funds on  the last day of the Eurodollar-Interest Period applicable thereto (and, if any Eurodollar- Interest Period shall exceed three months, then on the last Business Day of the third month  of such Eurodollar-Interest Period, and at three month intervals thereafter).  Interest  accruing at the Eurodollar-based Rate shall be computed on the basis of a 360 day year and  assessed for the actual number of days elapsed from the first day of the Eurodollar-Interest  Period applicable thereto to but not including the last day thereof.  (c) [Intentionally Omitted].  (d) Notwithstanding anything to the contrary in the preceding sections, all  accrued and unpaid interest on any Advance continued or converted pursuant to Section 2.3  shall be due and payable in full on the date such Revolving Credit Advance is continued,  refunded or converted.   (e) In the case of any Event of Default under Section 9.1(j), immediately upon  the occurrence thereof (and for so long as such Event of Default is continuing), and in the  case of any other Event of Default (and for so long as such Event of Default is continuing),  immediately upon receipt by Administrative Agent of notice from the Majority Lenders  (with a copy to Borrower), interest shall be payable on demand on all Revolving Credit  Advances from time to time outstanding at a per annum rate equal to the Applicable Interest  Rate in respect of each such Advance plus two percent (2%).  2.7 Optional Prepayments.  (a) (i) Borrower may prepay all or part of the outstanding principal of any Base  Rate Advance(s) of the Revolving Credit at any time (subject to not less than one (1)  Business Day prior notice to Administrative Agent), provided that, after giving effect to  any partial prepayment, the aggregate balance of Base Rate Advance(s) of the Revolving  Credit remaining outstanding shall be at least $250,000 and (ii) subject to Section 2.10(e),  Borrower may prepay all or part of the outstanding principal of any Eurodollar-based  Advance of the Revolving Credit at any time (subject to not less than three (3) Business  Days’ prior notice to Administrative Agent), provided that, after giving effect to any partial  prepayment, the unpaid portion of any Eurodollar-based Advance of the Revolving Credit  which is to be continued or converted under Section 2.3 shall be at least $250,000.  (b) Each partial prepayment of the outstanding principal of any Base Rate  Advance(s) or Eurodollar-based Advance(s) shall be in an amount that would be permitted  in the case of a borrowing of a Base Rate Advance or Eurodollar-based Advance, as  applicable, pursuant to Section 2.3.  (c) Any prepayment of a Base Rate Advance made in accordance with this  Section shall be without premium or penalty and any prepayment of any other type of  Advance shall be subject to the provisions of Section 11.1, but otherwise without premium  or penalty.  

 

  84134605.9   MRC Energy Company Credit Agreement 44  (d) Any notice of prepayment pursuant to this Section 2.7 shall be in the form  attached hereto as Exhibit G or such other form reasonably acceptable to the Administrative  Agent.  2.8 Base Rate Advance in Absence of Election or Upon Default.  If, (a) as to any  outstanding Eurodollar-based Advance of the Revolving Credit, Administrative Agent has not  received payment of all outstanding principal and accrued interest on the last day of the Interest  Period applicable thereto, or does not receive a timely Request for Revolving Credit Advance  meeting the requirements of Section 2.3 with respect to the continuation, refunding or conversion  of such Advance, or (b) if on the last day of the applicable Interest Period a Default or an Event of  Default shall have occurred and be continuing, then, on the last day of the applicable Interest Period  the principal amount of any Eurodollar-based Advance which has not been prepaid shall, absent a  contrary election of the Majority Lenders, be converted automatically to a Base Rate Advance and  Administrative Agent shall thereafter promptly notify Borrower of said action.  All accrued and  unpaid interest on any Advance converted to a Base Rate Advance under this Section 2.8 shall be  due and payable in full on the date such Advance is converted.  2.9 Commitment Fees.  Except as otherwise provided in Section 10.4(c), from the  Effective Date to the Revolving Credit Maturity Date, Borrower shall pay to Administrative Agent  for distribution to the Revolving Credit Lenders pro-rata in accordance with their respective  Revolving Credit Percentages, a Commitment Fee in arrears on the last day of each March, June,  September and December (in respect of the prior three months or any portion thereof) and on the  Revolving Credit Maturity Date.  The Commitment Fee payable to each Revolving Credit Lender  shall be determined by multiplying the Applicable Fee Percentage times such Lender’s Revolving  Credit Percentage of the average daily amount of the Unused Revolving Credit Availability.  The  Commitment Fee shall be computed on the basis of a year of three hundred sixty (360) days and  assessed for the actual number of days elapsed.  Whenever any payment of the Commitment Fee  shall be due on a day which is not a Business Day, the date for payment thereof shall be extended  to the next Business Day.  Upon receipt of such payment, Administrative Agent shall make prompt  payment to each Revolving Credit Lender of its share of the Commitment Fee based upon its  respective Revolving Credit Percentage.  It is expressly understood that the Commitment Fee  described in this Section is not refundable.  2.10 Mandatory Prepayment of Advances.  (a) If, after giving effect to any termination or reduction of the Maximum  Facility Amount or the Borrowing Base, as the case may be, pursuant to Section 2.11 the  Aggregate Credit Exposure exceeds the Revolving Credit Aggregate Commitment, then  Borrower shall immediately (and in any event on the Business Day of such termination or  reduction) prepay, subject to any funding indemnification amounts required by Section  11.1, the principal amount of the Advances to the extent necessary to eliminate such excess.  (b) If at any time and for any reason a Borrowing Base Deficiency exists, then  Borrower shall comply with Section 4.6.  (c) Subject to clauses (e) and (f) below, no later than the second Business Day  following receipt by (w) any Credit Party of Net Cash Proceeds from the issuance of any  

 

  84134605.9   MRC Energy Company Credit Agreement 45  Equity Interests by any Credit Party in an amount in excess of $5,000,000 (other than  Equity Interests issued (A) under any stock option or employee incentive plans or (B) to a  Credit Party), (x) any Credit Party of Net Cash Proceeds of any Debt issuance in excess of  $5,000,000 under Section 8.1(s), (y) any Credit Party of Net Cash Proceeds of any Senior  Notes issuance (other than a Permitted Refinancing that extends, refinances, renews,  replaces, repurchases, defeases or refunds outstanding Senior Notes) or (z) any Credit Party  of Net Cash Proceeds from the Disposition of Borrowing Base Properties pursuant to  Section 8.4(k), Borrower shall prepay the Revolving Credit by an amount equal to 100%  of such Net Cash Proceeds, but with respect to clauses (w), (x) and (z), only to the extent  that the Aggregate Credit Exposure exceeds the Revolving Credit Aggregate Commitment;  provided that, for purposes of clause (z) and so long as such Disposition of Borrowing Base  Properties did not result in an automatic reduction of the Borrowing Base pursuant to  Section 8.4(k), Borrower shall not be required to prepay the Revolving Credit in  accordance with clause (z) until the fair market value of all Borrowing Base Properties  Disposed of (whether pursuant to a Disposition of Equity Interests of any Restricted  Subsidiary owning Borrowing Base Properties or otherwise) since the most recent  scheduled redetermination of the Borrowing Base is greater than or equal to $5,000,000 in  the aggregate.  (d) [Intentionally Omitted].  (e) Subject to Section 10.2, any prepayment required pursuant to this  Section 2.10 shall be applied first to outstanding Base Rate Advances under the Revolving  Credit and then to Eurodollar-based Advances under the Revolving Credit at the discretion  of Borrower.  If any amounts remain thereafter, a portion of such prepayment equivalent  to the undrawn amount of any outstanding Letters of Credit shall be held by Administrative  Agent as cash collateral for the Reimbursement Obligations, with any additional  prepayment monies being applied to any Fees, costs or expenses due and outstanding under  this Agreement, and with the remainder of such prepayment thereafter being returned to  Borrower.  (f) To the extent that, on the date any mandatory prepayment of the Revolving  Credit Advances under this Section 2.10 or payment pursuant to the terms of any of the  Loan Documents is due, the Advances under the Revolving Credit to be prepaid is being  carried, in whole or in part, at the Eurodollar-based Rate and no Default or Event of Default  has occurred and is continuing, Borrower may, at Borrower’s election, deposit the amount  of such mandatory prepayment in a non-interest bearing cash collateral account to be held  by Administrative Agent, for and on behalf of the Revolving Credit Lenders, on such terms  and conditions as are reasonably acceptable to Administrative Agent and upon such deposit  the obligation of Borrower to make such mandatory prepayment shall be deemed satisfied.   Subject to the terms and conditions of said cash collateral account, sums on deposit in said  cash collateral account shall be applied (until exhausted) to reduce the principal balance of  the Revolving Credit on the last day of each Eurodollar-Interest Period attributable to the  Eurodollar-based Advances, thereby avoiding breakage costs under Section 11.1;  provided, however, that if a Default or Event of Default shall have occurred at any time  while sums are on deposit in the cash collateral account, Administrative Agent may, in its  sole discretion, elect to apply such sums to reduce the principal balance of such  

 

  84134605.9   MRC Energy Company Credit Agreement 46  Eurodollar-based Advances prior to the last day of the applicable Eurodollar-Interest  Period, and Borrower will be obligated to pay any resulting breakage costs under  Section 11.1.  2.11 Optional Reduction or Termination of Commitments.  Borrower may, upon at least  three (3) Business Days’ prior written notice to Administrative Agent, at any time terminate, or  from time to time permanently reduce, the Maximum Facility Amount or the Borrowing Base in  whole or in part, without premium or penalty, provided that:  (i) each partial reduction of the  Maximum Facility Amount or the Borrowing Base, as applicable, shall be in an aggregate amount  equal to at least One Million Dollars ($1,000,000); (ii) Borrower shall prepay in accordance with  the terms hereof the amount, if any, by which the Aggregate Credit Exposure exceeds either or  both (A) the Maximum Facility Amount and/or (B) the Borrowing Base, in each case after such  reduction, together with interest thereon to the date of prepayment; and (iii) no reduction shall  reduce the Maximum Facility Amount or the Borrowing Base to an amount which is less than the  aggregate undrawn amount of any Letters of Credit outstanding at such time; provided, however  that if the termination or reduction of the Maximum Facility Amount or the Borrowing Base  requires the prepayment of a Eurodollar-based Advance and such termination or reduction is made  on a day other than the last Business Day of the then current Interest Period applicable to such  Eurodollar-based Advance, then Borrower shall compensate the Revolving Credit Lenders in  accordance with Section 11.1 or, so long as no Default or Event of Default has occurred and is  continuing, Borrower may deposit the amount of such prepayment in a non-interest bearing cash  collateral account as provided in Section 2.10(f).  Any reductions of the Maximum Facility  Amount or the Borrowing Base pursuant to this Section 2.11 shall be permanent and irrevocable.   Any payments made pursuant to this Section shall be applied first to outstanding Base Rate  Advances under the Revolving Credit and then to Eurodollar-based Advances of the Revolving  Credit.  2.12 Use of Proceeds of Advances.  Advances shall be used for acquisition financing  and general corporate purposes, including capital expenditures, development and operational  activities, ongoing working capital, and payment of fees and expenses incurred in connection with  this Agreement and the other Loan Documents.  ARTICLE 3. LETTERS OF CREDIT.  3.1 Letters of Credit.  Subject to the terms and conditions of this Agreement, each  Issuing Lender may through the Issuing Office, at any time and from time to time from and after  the date hereof until thirty (30) days prior to the Revolving Credit Maturity Date, upon the written  request of Borrower accompanied by a duly executed Letter of Credit Agreement and such other  documentation related to the requested Letter of Credit as such Issuing Lender may reasonably  require, issue Letters of Credit in Dollars for the account of Borrower, in an aggregate amount for  all Letters of Credit issued hereunder at any one time outstanding not to exceed the Letter of Credit  Maximum Amount.  Each Letter of Credit shall be in a minimum face amount of Ten Thousand  Dollars ($10,000) (or such lesser amount as may be agreed to by such Issuing Lender) and each  Letter of Credit (including any renewal thereof) shall expire not later than the first to occur of  (i) twelve (12) months after the date of issuance thereof and (ii) ten (10) Business Days prior to  the Revolving Credit Maturity Date in effect on the date of issuance thereof; provided, however,  in connection with the request for the initial issuance of a Letter of Credit, Borrower may request  

 

  84134605.9   MRC Energy Company Credit Agreement 47  that the Letter of Credit will be automatically renewed for similar successive periods of time unless  and until Borrower provides a notice no later than 10 days prior to its expiration to the applicable  Issuing Lender that the Letter of Credit should not be renewed.  Notwithstanding anything to the  contrary contained herein, no Letter of Credit shall be renewed for a similar successive period of  time if its expiration is later than ten (10) Business Days before the Revolving Credit Maturity  Date.  The submission of all applications in respect of and the issuance of each Letter of Credit  hereunder shall be subject in all respects to such industry rules and governing laws as are  acceptable to the applicable Issuing Lender.  In the event of any conflict between this Agreement  and any Letter of Credit Document other than any Letter of Credit, this Agreement shall control.   All Existing Letters of Credit shall be deemed to have been issued pursuant hereto, and from and  after the Effective Date shall be subject to and governed by the terms and conditions hereof.  3.2 Conditions to Issuance.  No Letter of Credit shall be issued (including the renewal  or extension of any Letter of Credit previously issued) at the request and for the account of  Borrower unless, as of the date of issuance (or renewal or extension) of such Letter of Credit:  (a) after giving effect to the Letter of Credit requested, (i) the Letter of Credit  Obligations do not exceed the Letter of Credit Maximum Amount; and (ii) the Aggregate  Credit Exposure does not exceed the Revolving Credit Aggregate Commitment;  (b) the representations and warranties of the Credit Parties contained in this  Agreement and the other Loan Documents are true and correct in all material respects and  shall be true and correct in all material respects as of date of the issuance of such Letter of  Credit (both before and immediately after the issuance of such Letter of Credit), other than  any representation or warranty that expressly speaks only as of a different date;  (c) there is no Default or Event of Default in existence, and none will exist upon  the issuance of such Letter of Credit;  (d) Borrower shall have delivered to the applicable Issuing Lender at its Issuing  Office, not less than three (3) Business Days prior to the requested date for issuance (or  such shorter time as the applicable Issuing Lender, in its sole discretion, may permit), the  Letter of Credit Agreement related thereto, together with such other documents and  materials as may be reasonably required pursuant to the terms thereof, and the terms of the  proposed Letter of Credit shall be reasonably satisfactory to the applicable Issuing Lender;  (e) concurrently with the delivery to the applicable Issuing Lender of the Letter  of Credit Agreement pursuant to clause (d) above, Borrower shall have delivered to the  Administrative Agent notice of the request for such Letter of Credit in the form attached  hereto as Exhibit F or in such other form reasonably acceptable to the Administrative  Agent, together with a copy of the Letter of Credit Agreement delivered to the applicable  Issuing Lender in respect of such Letter of Credit;  (f) no order, judgment or decree of any court, arbitrator or Governmental  Authority shall purport by its terms to enjoin or restrain the applicable Issuing Lender from  issuing the Letter of Credit requested, or any Revolving Credit Lender from taking its  participation interest therein in accordance with the terms of Section 3.6, and no law, rule,  

 

  84134605.9   MRC Energy Company Credit Agreement 48  regulation, request or directive (whether or not having the force of law) shall prohibit the  applicable Issuing Lender from issuing, or any Revolving Credit Lender from acquiring a  participation in, the Letter of Credit requested or letters of credit generally;  (g) after the Effective Date, there shall have been (i) no introduction of or  change in the interpretation of any law or regulation, (ii) no declaration of a general  banking moratorium by banking authorities in the United States, Texas or the respective  jurisdictions in which the Revolving Credit Lenders, Borrower and the beneficiary of the  requested Letter of Credit are located, and (iii) no establishment of any new restrictions by  any central bank or other Governmental Authority on transactions involving letters of  credit or on banks generally that, in any case described in this clause (f), would make it  unlawful for the applicable Issuing Lender to issue or any Revolving Credit Lender to  acquire its participation interest in accordance with the terms of Section 3.6 in the requested  Letter of Credit or letters of credit generally;  (h) if any Revolving Credit Lender is a Defaulting Lender, the applicable  Issuing Lender has entered into arrangements satisfactory to it to eliminate the Fronting  Exposure with respect to the participation in the Letter of Credit Obligations by such  Defaulting Lender, including creation by such Defaulting Lender of a cash collateral  account on terms reasonably satisfactory to Administrative Agent or delivery of other  security by such Defaulting Lender to assure payment of such Defaulting Lender’s  Revolving Credit Percentage of all outstanding Letter of Credit Obligations; and  (i) the applicable Issuing Lender shall have received the issuance fees required  in connection with the issuance of such Letter of Credit pursuant to Section 3.4.  Each Letter of Credit Agreement submitted to an Issuing Lender pursuant hereto shall constitute  the certification by Borrower of the matters set forth in Section 5.2.  3.3 Notice. Each Issuing Lender shall deliver to Administrative Agent, concurrently  with or promptly following its issuance of any Letter of Credit, a true and complete copy of each  Letter of Credit.  Promptly upon its receipt thereof, Administrative Agent shall give notice to each  Revolving Credit Lender of the issuance of each Letter of Credit, specifying the amount thereof  and the amount of such Revolving Credit Lender’s Revolving Credit Percentage thereof.  3.4 Letter of Credit Fees; Increased Costs.  (a) Borrower shall pay letter of credit fees as follows:  (i) A per annum letter of credit fee with respect to the undrawn amount  of each Letter of Credit issued pursuant hereto (based on the amount of each Letter  of Credit) in the amount of the Applicable Fee Percentage (determined with  reference to Schedule 1.1 to this Agreement) shall be paid to Administrative Agent  for distribution to the Revolving Credit Lenders in accordance with their Revolving  Credit Percentages.  

 

  84134605.9   MRC Energy Company Credit Agreement 49  (ii) A letter of credit facing fee on the face amount of each Letter of  Credit shall be paid to the appropriate Issuing Lender for its own account, in  accordance with the terms of the Fee Letter.  (b) All payments by Borrower to Administrative Agent for distribution to any  Issuing Lender or the Revolving Credit Lenders under this Section 3.4 shall be made in  Dollars in immediately available funds at the Issuing Office or such other office of  Administrative Agent as may be designated from time to time by written notice to  Borrower by Administrative Agent.  The fees described in clauses (a)(i) and (ii) above  (i) shall be nonrefundable under all circumstances, (ii) in the case of fees due under  clause (a)(i) above, shall be payable quarterly in arrears on the last day of each March,  June, September and December and on the Revolving Credit Maturity Date and (iii) in the  case of fees due under clause (a)(ii) above, shall be payable upon the issuance of such  Letter of Credit and quarterly in arrears thereafter and on the Revolving Credit Maturity  Date.  The fees due under clause (a)(i) above shall be determined by multiplying the  Applicable Fee Percentage times the undrawn amount of the face amount of each such  Letter of Credit on the date of determination, and shall be calculated on the basis of a 360  day year and assessed for the actual number of days from the date of the issuance thereof  to the stated expiration thereof.  The parties hereto acknowledge that, unless the applicable  Issuing Lender otherwise agrees, any material amendment and any extension to a Letter of  Credit issued hereunder shall be treated as a new Letter of Credit for the purposes of the  letter of credit facing fee.  (c) If any Change in Law shall either (i) impose, modify or cause to be deemed  applicable any reserve, special deposit, limitation or similar requirement against letters of  credit issued or participated in by, or assets held by, or deposits in or for the account of,  any Issuing Lender or any Revolving Credit Lender or (ii) impose on any Issuing Lender  or any Revolving Credit Lender any other condition regarding this Agreement, the Letters  of Credit or any participations in such Letters of Credit, and the result of any event referred  to in clause (i) or (ii) above shall be to increase the cost or expense to such Issuing Lender  or such Revolving Credit Lender of issuing or maintaining or participating in any of the  Letters of Credit (which increase in cost or expense shall be determined by such Issuing  Lender’s or such Revolving Credit Lender’s reasonable allocation of the aggregate of such  cost increases and expenses resulting from such events), then, upon demand by such  Issuing Lender or such Revolving Credit Lender, as the case may be, Borrower shall, within  thirty (30) days following demand for payment, pay to such Issuing Lender or such  Revolving Credit Lender, as the case may be, from time to time as specified by such Issuing  Lender or such Revolving Credit Lender, additional amounts which shall be sufficient to  compensate such Issuing Lender or such Revolving Credit Lender for such increased cost  and expense, provided that if such Issuing Lender or such Revolving Credit Lender could  take any reasonable action, without cost or administrative or other burden or restriction to  such Lender, to mitigate or eliminate such cost or expense, it agrees to do so within a  reasonable time after becoming aware of the foregoing matters.  Each demand for payment  under this Section 3.4(c) shall be accompanied by a certificate of the applicable Issuing  Lender or the applicable Revolving Credit Lender setting forth the amount of such  increased cost or expense incurred by such Issuing Lender or such Revolving Credit  Lender, as the case may be, as a result of any event mentioned in clause (i) or (ii) above,  

 

  84134605.9   MRC Energy Company Credit Agreement 50  and in reasonable detail, the methodology for calculating and the calculation of such  amount, which certificate shall be prepared in good faith and shall be conclusive evidence,  absent manifest error, as to the amount thereof.  (d) Notwithstanding anything to the contrary contained in Section 3.4(c),  Borrower shall not be required to reimburse or pay any costs or expenses to any Issuing  Lender or any Revolving Credit Lender as required by Section 3.4(c) which have accrued  more than 180 days prior to such Lender’s giving notice to Borrower that such Lender has  suffered or incurred such costs or expenses.  None of the Lenders shall be permitted to pass  through to Borrower costs and expenses under Section 3.4(c) which are not also passed  through by such Lender to other customers of such Lender similarly situated when such  customer is subject to documents containing substantively similar provisions as those  contained in this Section.  3.5 Other Fees.  In connection with the Letters of Credit, and in addition to the Letter  of Credit Fees, Borrower shall pay, for the sole account of the applicable Issuing Lender, standard  documentation, administration, payment and cancellation charges assessed by such Issuing Lender  or the Issuing Office, at the times, in the amounts and on the terms set forth or to be set forth from  time to time in the standard fee schedule of the Issuing Office in effect from time to time.  3.6 Participation Interests in and Drawings and Demands for Payment Under Letters of  Credit.  (a) Upon issuance by an Issuing Lender of each Letter of Credit hereunder,  each Revolving Credit Lender shall automatically acquire a pro rata participation interest  in such Letter of Credit and each related Letter of Credit Payment based on its respective  Revolving Credit Percentage.  (b) If any Issuing Lender shall honor a draft or other demand for payment  presented or made under any Letter of Credit, Borrower agrees to pay to such Issuing  Lender an amount equal to the amount paid by such Issuing Lender in respect of such draft  or other demand under such Letter of Credit and all reasonable expenses paid or incurred  by Administrative Agent relative thereto not later than 1:00 p.m. (New York time), in  Dollars, on (i) the Business Day that Borrower received notice of such presentment and  honor, if such notice is received prior to 11:00 a.m. (New York time) or (ii) the Business  Day immediately following the day that Borrower received such notice, if such notice is  received after 11:00 a.m. (New York time).  (c) If any Issuing Lender shall honor a draft or other demand for payment  presented or made under any Letter of Credit, but Borrower does not reimburse such  Issuing Lender as required under clause (b) above and the Revolving Credit Aggregate  Commitment has not been terminated (whether by maturity, acceleration or otherwise),  Borrower shall be deemed to have immediately requested that the Revolving Credit  Lenders make a Base Rate Advance of the Revolving Credit (which Advance may be  subsequently converted at any time into a Eurodollar-based Advance pursuant to  Section 2.3) in the principal amount equal to the amount paid by such Issuing Lender in  respect of such draft or other demand under such Letter of Credit and all reasonable  

 

  84134605.9   MRC Energy Company Credit Agreement 51  expenses paid or incurred by Administrative Agent relative thereto.  Administrative Agent  will promptly notify the Revolving Credit Lenders of such deemed request, and each such  Lender shall make available to Administrative Agent an amount equal to its pro rata share  (based on its Revolving Credit Percentage) of the amount of such Advance.  (d) If any Issuing Lender shall honor a draft or other demand for payment  presented or made under any Letter of Credit, but Borrower does not reimburse such  Issuing Lender as required under clause (b) above, and (i) the Revolving Credit Aggregate  Commitment has been terminated (whether by maturity, acceleration or otherwise), or  (ii) any reimbursement received by such Issuing Lender from Borrower is or must be  returned or rescinded upon or during any bankruptcy or reorganization of any Credit Party  or otherwise, then Administrative Agent shall notify each Revolving Credit Lender, and  each Revolving Credit Lender will be obligated to pay Administrative Agent for the  account of such Issuing Lender its pro rata share (based on its Revolving Credit  Percentage) of the amount paid by such Issuing Lender in respect of such draft or other  demand under such Letter of Credit and all reasonable expenses paid or incurred by  Administrative Agent relative thereto (but no such payment shall diminish the obligations  of Borrower hereunder).  To the extent that a Revolving Credit Lender fails to make such  amount available to Administrative Agent by 11:00 a.m. (New York time) on the Business  Day next succeeding the date such notice is given, such Revolving Credit Lender shall pay  interest on such amount in respect of each day from the date such amount was required to  be paid, to the date paid to Administrative Agent, at a rate per annum equal to the Federal  Funds Effective Rate.  The failure of any Revolving Credit Lender to make its pro rata  portion of any such amount available under to Administrative Agent shall not relieve any  other Revolving Credit Lender of its obligation to make available its pro rata portion of  such amount, but no Revolving Credit Lender shall be responsible for failure of any other  Revolving Credit Lender to make such pro rata portion available to Administrative Agent.  (e) In the case of any Advance made under this Section 3.6, each such Advance  shall be disbursed notwithstanding any failure to satisfy any conditions for disbursement  of any Advance set forth in Article 2 or Article 5, and, to the extent of the Advance so  disbursed, the Reimbursement Obligation of Borrower to Administrative Agent under this  Section 3.6 shall be deemed satisfied (unless, in each case, taking into account any such  deemed Advances, the Aggregate Credit Exposure exceeds the then applicable Revolving  Credit Aggregate Commitment).  (f) If any Issuing Lender shall honor a draft or other demand for payment  presented or made under any Letter of Credit, Such Issuing Lender shall provide notice  thereof to Borrower on the date such draft or demand is honored, and to each Revolving  Credit Lender on such date unless Borrower shall have satisfied its reimbursement  obligations by payment to Administrative Agent (for the benefit of Such Issuing Lender) as  required under this Section 3.6.  Each Issuing Lender shall further use reasonable efforts  to provide notice to Borrower prior to honoring any such draft or other demand for  payment, but such notice, or the failure to provide such notice, shall not affect the rights or  obligations of such Issuing Lender with respect to any Letter of Credit or the rights and  obligations of the parties hereto, including without limitation the obligations of Borrower  under this Section 3.6.  

 

  84134605.9   MRC Energy Company Credit Agreement 52  (g) Nothing in this Agreement shall be construed to require or authorize any  Revolving Credit Lender to issue any Letter of Credit, it being recognized that the Issuing  Lenders shall be the sole issuer of Letters of Credit under this Agreement.  (h) In the event that any Revolving Credit Lender becomes a Defaulting  Lender, and the reallocation of Fronting Exposure pursuant to Section 10.4 cannot be  achieved, each Issuing Lender may, at its option, require that Borrower enter into  arrangements satisfactory to such Issuing Lender to eliminate the Fronting Exposure with  respect to the participation in the Letter of Credit Obligations by such Defaulting Lender,  including creation of a cash collateral account on terms reasonably satisfactory to  Administrative Agent or delivery of other security to assure payment of such Defaulting  Lender’s Revolving Credit Percentage of all outstanding Letter of Credit Obligations.  3.7 Obligations Irrevocable and Absolute.  The obligations of Borrower to make  payments to Administrative Agent for the account of each Issuing Lender or the Revolving Credit  Lenders with respect to Letter of Credit Obligations under Section 3.6, shall be unconditional,  irrevocable and absolute and not subject to any qualification or exception whatsoever, including,  without limitation:  (a) Any lack of validity or enforceability of any Letter of Credit, any Letter of  Credit Agreement, any other documentation relating to any Letter of Credit, this  Agreement or any of the other Loan Documents (the “Letter of Credit Documents”);  (b) Any amendment, modification, waiver, consent, or any substitution,  exchange or release of or failure to perfect any interest in collateral or security, with respect  to or under any Letter of Credit Document;  (c) The existence of any claim, setoff, defense or other right which Borrower  may have at any time against any beneficiary or any transferee of any Letter of Credit (or  any persons or entities for whom any such beneficiary or any such transferee may be  acting), Administrative Agent, the Issuing Lenders or any Revolving Credit Lender or any  other Person, whether in connection with this Agreement, any of the Letter of Credit  Documents, the transactions contemplated herein or therein or any unrelated transactions;  (d) Any draft or other statement or document presented under any 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;  (e) Payment by the Issuing Lenders to the beneficiary under any Letter of  Credit against presentation of documents which do not comply with the terms of such  Letter of Credit, including failure of any documents to bear any reference or adequate  reference to such Letter of Credit;  (f) Any failure, omission, delay or lack on the part of Administrative Agent,  any Issuing Lender or any Revolving Credit Lender or any party to any of the Letter of  Credit Documents or any other Loan Document to enforce, assert or exercise any right,  power or remedy conferred upon Administrative Agent, any Issuing Lender, any Revolving  Credit Lender or any such party under this Agreement, any of the other Loan Documents  

 

  84134605.9   MRC Energy Company Credit Agreement 53  or any of the Letter of Credit Documents, or any other acts or omissions on the part of  Administrative Agent, any Issuing Lender, any Revolving Credit Lender or any such party;  or  (g) Any other event or circumstance that would, in the absence of this  Section 3.7, result in the release or discharge by operation of law or otherwise of Borrower  from the performance or observance of any obligation, covenant or agreement contained  in Section 3.6 (other than the defense of payment or performance).  No setoff, counterclaim, reduction or diminution of any obligation or any defense of any kind or  nature which Borrower has or may have against the beneficiary of any Letter of Credit shall be  available hereunder to Borrower against Administrative Agent, any Issuing Lender or any  Revolving Credit Lender.  With respect to any Letter of Credit, nothing contained in this  Section 3.7 shall be deemed to prevent Borrower, after satisfaction in full of the absolute and  unconditional obligations of Borrower hereunder with respect to such Letter of Credit, from  asserting in a separate action any claim, defense, set off or other right which it may have against  Administrative Agent, any Issuing Lender or any Revolving Credit Lender in connection with such  Letter of Credit.  3.8 Risk Under Letters of Credit.  (a) In the administration and handling of Letters of Credit and any security  therefor, or any documents or instruments given in connection therewith, each Issuing  Lender shall have the sole right to take or refrain from taking any and all actions under or  upon the Letters of Credit.  (b) Subject to other terms and conditions of this Agreement, each Issuing  Lender shall issue the Letters of Credit and shall hold the documents related thereto in its  own name and shall make all collections thereunder and otherwise administer the Letters  of Credit in accordance with such Issuing Lender’s regularly established practices and  procedures and will have no further obligation with respect thereto.  In the administration  of Letters of Credit, no Issuing Lender shall be liable for any action taken or omitted on  the advice of counsel, accountants, appraisers or other experts selected by such Issuing  Lender with due care and such Issuing Lender may rely upon any notice, communication,  certificate or other statement from Borrower, beneficiaries of Letters of Credit, or any other  Person which such Issuing Lender believes to be authentic.  Each Issuing Lender will, upon  request, furnish the Revolving Credit Lenders with copies of Letter of Credit Documents  related thereto.  (c) In connection with the issuance and administration of Letters of Credit and  the assignments hereunder, the Issuing Lenders make no representation and shall have no  responsibility with respect to (i) the obligations of Borrower or the validity, sufficiency or  enforceability of any document or instrument given in connection therewith, or the taking  of any action with respect to same, (ii) the financial condition of, any representations made  by, or any act or omission of Borrower or any other Person, or (iii) any failure or delay in  exercising any rights or powers possessed by the Issuing Lenders in their capacity as issuers  of Letters of Credit in the absence of its gross negligence or willful misconduct.  Each of  

 

  84134605.9   MRC Energy Company Credit Agreement 54  the Revolving Credit Lenders expressly acknowledges that it has made and will continue  to make its own evaluations of Borrower’s creditworthiness without reliance on any  representation of any Issuing Lender or such Issuing Lender’s officers, agents and  employees.  (d) If at any time any Issuing Lender shall recover any part of any unreimbursed  amount for any draw or other demand for payment under a Letter of Credit, or any interest  thereon, Administrative Agent or such Issuing Lender, as the case may be, shall receive  same for the pro rata benefit of the Revolving Credit Lenders in accordance with their  respective Revolving Credit Percentages and shall promptly deliver to each Revolving  Credit Lender its share thereof, less such Revolving Credit Lender’s pro rata share of the  costs of such recovery, including court costs and attorney’s fees.  If at any time any  Revolving Credit Lender shall receive from any source whatsoever any payment on any  such unreimbursed amount or interest thereon in excess of such Revolving Credit Lender’s  Revolving Credit Percentage of such payment, such Revolving Credit Lender will  promptly pay over such excess to Administrative Agent, for redistribution in accordance  with this Agreement.  3.9 Indemnification.  Borrower hereby indemnifies and agrees to hold harmless the  Revolving Credit Lenders, each Issuing Lender and Administrative Agent and their respective  Affiliates, and the respective officers, directors, employees and agents of such Persons (each an  “L/C Indemnified Person”), from and against any and all claims, damages, losses, liabilities, costs  or expenses of any kind or nature whatsoever which the Revolving Credit Lenders, the Issuing  Lenders or Administrative Agent or any such Person may incur or which may be claimed against  any of them by reason of or in connection with any Letter of Credit (collectively, the “L/C  Indemnified Amounts”), and none of the L/C Indemnified Persons shall be liable or responsible  for:  (a) the use which may be made of any Letter of Credit or for any acts or  omissions of any beneficiary in connection therewith;  (b) the validity, sufficiency or genuineness of documents or of any endorsement  thereon, even if such documents should in fact prove to be in any or all respects invalid,  insufficient, fraudulent or forged;  (c) payment by any Issuing Lender to the beneficiary under any Letter of Credit  against presentation of documents which do not strictly comply with the terms of any Letter  of Credit (unless such payment resulted from the gross negligence or willful misconduct  of such Issuing Lender), including failure of any documents to bear any reference or  adequate reference to such Letter of Credit;  (d) any error, omission, interruption or delay in transmission, dispatch or  delivery of any message or advice, however transmitted, in connection with any Letter of  Credit (except for errors and omissions resulting from gross negligence or willful  misconduct of the applicable Issuing Lender); or  

 

  84134605.9   MRC Energy Company Credit Agreement 55  (e) any other event or circumstance whatsoever arising in connection with any  Letter of Credit.  It is understood that in making any payment under a Letter of Credit, each Issuing Lender will rely  on documents presented to it under such Letter of Credit as to any and all matters set forth therein  without further investigation and regardless of any notice or information to the contrary.  With respect to subparagraphs (a) through (e) hereof, (i) Borrower shall not be required to  indemnify any L/C Indemnified Person for any L/C Indemnified Amounts to the extent such  amounts result from  (x) the gross negligence or willful misconduct of such L/C Indemnified  Person or any officer, director, employee or agent of such L/C Indemnified Person or (y) matters  arising solely by reason of claims between or among L/C Indemnified Persons and not relating to  any action of such L/C Indemnified Person in its capacity as Administrative Agent or Issuing  Lender, as applicable, and (ii) each of Administrative Agent, Lenders and the Issuing Lenders shall  be liable to Borrower to the extent, but only to the extent, of any direct, as opposed to consequential  or incidental, damages suffered by Borrower which were caused by the gross negligence or willful  misconduct of such Person (including in the case of any Issuing Lender, any wrongful dishonor of  any Letter of Credit after the presentation to it by the beneficiary thereunder of a draft or other  demand for payment and other documentation strictly complying with the terms and conditions of  such Letter of Credit).  3.10 Right of Reimbursement.  Each Revolving Credit Lender agrees to reimburse each  Issuing Lender on demand, pro rata in accordance with its respective Revolving Credit Percentage,  for (i) the reasonable out-of-pocket costs and expenses of such Issuing Lender to be reimbursed  by Borrower pursuant to any Letter of Credit Agreement or any Letter of Credit, to the extent not  reimbursed by Borrower or any other Credit Party and (ii) any and all liabilities, obligations,  losses, damages, penalties, actions, judgments, suits, costs, fees, reasonable out-of-pocket  expenses or disbursements of any kind and nature whatsoever which may be imposed on, incurred  by or asserted against such Issuing Lender in any way relating to or arising out of this Agreement  (including Section 3.6(c)), any Letter of Credit, any documentation or any transaction relating  thereto, or any Letter of Credit Agreement, to the extent not reimbursed by Borrower, except to  the extent that such liabilities, losses, costs or expenses were incurred by such Issuing Lender as a  result of such Issuing Lender’s gross negligence or willful misconduct or by such Issuing Lender’s  wrongful dishonor of any Letter of Credit after the presentation to it by the beneficiary thereunder  of a draft or other demand for payment and other documentation strictly complying with the terms  and conditions of such Letter of Credit.  ARTICLE 4. BORROWING BASE.  4.1 Borrowing Base.  The term “Borrowing Base” means, as of the date of  determination thereof, the designated loan value as calculated by Lenders in their sole discretion  assigned to the discounted present value of future net income accruing to the Borrowing Base  Properties, based upon Lenders’ in-house evaluation of Borrowing Base Properties.  The Lenders’  determination of the Borrowing Base will be made in accordance with then-current practices,  economic and pricing parameters, methodology, assumptions, and customary procedures and  standards established by each Lender from time to time for its petroleum industry customers  including without limitation (a) an analysis of such reserves and production data with respect to  

 

  84134605.9   MRC Energy Company Credit Agreement 56  the Hydrocarbon Interests of the Credit Parties in all of their Oil and Gas Properties, including the  Mortgaged Properties, as is provided to Lenders in accordance herewith, (b) an analysis of the  assets, liabilities, cash flow, business, properties, prospects, management and ownership of each  Credit Party, and (c) such other credit factors as each Lender customarily considers in evaluating  similar oil and gas credits.  Borrower acknowledges that the determination of the Borrowing Base  contains an equity cushion (collateral value in excess of loan amount) which Borrower  acknowledges to be essential for the adequate protection of Lenders.  As of the Effective Date, the  Borrowing Base shall be $1,350,000,000.  4.2 Periodic Determinations of Borrowing Base.  After the Effective Date, the  Borrowing Base shall be redetermined by Lenders as of May 1 and November 1 of each year (each  a “Determination Date”) until maturity, commencing May 1, 2022.  The Borrowing Base, as  redetermined, shall remain in effect until the next Determination Date, provided the Borrowing  Base may be redetermined between Determination Dates in accordance with Section 4.4.  4.3 Engineering Data to be Provided Prior to Scheduled Determination Dates.  On or  before March 1 of each year for the Determination Date of May 1, Borrower shall deliver to  Administrative Agent a Reserve Report and the other data specified in Section 7.15.  Lenders shall  then determine the Borrowing Base for the six (6) month period commencing May 1, which  determination shall be made in accordance with the standards specified in Section 4.1 and the  procedures set forth in Section 4.5.  On or before September 1 of each year for the Determination  Date of November 1, Borrower shall deliver to Administrative Agent a Reserve Report and the  other data specified in Section 7.15.  Lenders shall then determine the Borrowing Base for the six  (6) month period commencing November 1, which determination shall be made in accordance with  the standards specified in Section 4.1 and the procedures set forth in Section 4.5.  4.4 Special Determinations of Borrowing Base.  Special determinations of the  Borrowing Base after the Effective Date, may be requested by the Administrative Agent once and  by Borrower once, in each case, between scheduled Determination Dates.  If any special  determination is requested by Administrative Agent or Borrower, Borrower will provide  Administrative Agent with engineering data for the oil and gas reserves included in the most recent  Reserve Report furnished Administrative Agent and the other data specified in Section 7.15 and  within the time period specified therein.  The determination whether to increase or decrease the  Borrowing Base shall then be made by Lenders in their sole discretion in accordance with the  standards set forth in Section 4.1 and the procedures set forth in Section 4.5.  4.5 General Procedures With Respect to Determination of Borrowing Base.   Administrative Agent shall propose a redetermined Borrowing Base within thirty (30) days  following receipt by Administrative Agent and Lenders of a Reserve Report and other applicable  information.  After having received notice of such proposal from Administrative Agent, the  Supermajority Lenders (or all Lenders in the event of a proposed increase in the Borrowing Base)  shall have fifteen (15) days to agree or disagree with such proposal.  If, at the end of such fifteen  (15) day period, the Supermajority Lenders (or all Lenders, in the event of a proposed increase of  the Borrowing Base) shall not have communicated their approval or disapproval, such silence shall  be deemed an approval, and Administrative Agent’s proposal shall be the new Borrowing Base.   If, however, the Supermajority Lenders (or any Lender, in the event of a proposed increase of the  Borrowing Base) notify Administrative Agent within such fifteen (15) days of their disapproval,  

 

  84134605.9   MRC Energy Company Credit Agreement 57  the Supermajority Lenders (or all Lenders, in the event of a proposed increase of the Borrowing  Base) shall, within a reasonable period of time, agree on a new Borrowing Base.  Lenders may  exclude any oil and gas reserves or portion of production therefrom or any income from any other  property from the Borrowing Base at any time because title information is not reasonably  satisfactory.  After a redetermined Borrowing Base is approved or deemed approved by all of the  Lenders or the Supermajority Lenders, as applicable, Administrative Agent shall promptly provide  Borrower with written notice of the redetermined Borrowing Base, and the redetermined  Borrowing Base shall become effective on the date of Borrower’s receipt of such notice.   Administrative Agent shall provide prompt written notice to Borrower of each Lender that  disapproves a redetermined Borrowing Base proposed by Administrative Agent.    4.6 Borrowing Base Deficiency.  If a Borrowing Base Deficiency shall exist because  of a periodic or special redetermination of the Borrowing Base pursuant to Section 4.2 or  Section 4.4, then Administrative Agent shall notify Borrower of the same, and Borrower shall  within thirty (30) days following receipt of such notice elect in writing whether to (i) prepay an  amount which will eliminate the Borrowing Base Deficiency, or (ii) execute and deliver to  Administrative Agent instruments mortgaging such other collateral as is reasonably acceptable to  the Majority Lenders, pursuant to security documents in form reasonably acceptable to  Administrative Agent having present values which, in the opinion of Majority Lenders, based upon  Majority Lenders’ evaluation of the engineering data provided them, taken in the aggregate are  sufficient to increase the Borrowing Base to an amount at least equal to the Aggregate Credit  Exposure, or (iii) do any combination of the foregoing.  If Borrower elects to prepay such  deficiency under clause (i) above, then such prepayment shall be made in six (6) equal consecutive  monthly installments beginning on the Deficiency Payment Commencement Date and continuing  on the same day of each month thereafter until paid.  If Borrower so elects to mortgage additional  Oil and Gas Properties, then clause (ii) above shall be accomplished within thirty (30) days from  Administrative Agent’s date of notification.  If Borrower fails to make an election among  clauses (i) through (iii) above within thirty (30) days from Administrative Agent’s notification,  then (x) Borrower shall be deemed to have selected the payment option specified in clause (i)  above, and (y) Borrower shall make such payment in six (6) equal consecutive monthly  installments beginning on the Deficiency Payment Commencement Date and continuing on the  same day of each month thereafter until paid.  “Deficiency Payment Commencement Date” means  (a) a day not later than the thirtieth (30th) day from the date of Administrative Agent’s notification  of the Borrowing Base Deficiency, in the case where Borrower elects the payment option for  clause (i) above or fails to make an election, or (b) a day which is within ten (10) days after receipt  of notice from Administrative Agent that such property submitted pursuant to clause (ii) above are  not acceptable or do not have sufficient present value to eliminate the Borrowing Base Deficiency,  as applicable.  If Borrower makes an election to mortgage additional Oil and Gas Properties but  such Oil and Gas Properties are not reasonably acceptable to the Majority Lenders or do not have  present values which in the aggregate are sufficient to eliminate the Borrowing Base Deficiency,  then (x) Borrower shall be deemed to have selected the payment option specified in clause (i)  above, and (y) Borrower shall make such payment in six (6) equal consecutive monthly  installments beginning on the Deficiency Payment Commencement Date and continuing on the  same day of each month thereafter until paid.  

 

  84134605.9   MRC Energy Company Credit Agreement 58  ARTICLE 5. CONDITIONS.  The obligations of Lenders to make Advances pursuant to this Agreement and the  obligation of the Issuing Lenders to issue Letters of Credit, and the continuation of the advances  and letters of credit under the Existing Credit Agreement as Advances and Letters of Credit under  this Agreement as contemplated by Section 13.21, shall not become effective until the date on  which the following conditions have been satisfied (or waived in accordance with Section 13.9):  5.1 Conditions of Initial Advances.  The obligations of Lenders to make initial  Advances pursuant to this Agreement and the obligation of the Issuing Lenders to issue initial  Letters of Credit, in each case, on the Effective Date only, are subject to the following conditions:  (a) Notes, this Agreement and the other Loan Documents.  (i) Borrower shall have executed and delivered to Administrative  Agent this Agreement and the Notes (for the account of each Lender requesting  Notes); and each Credit Party shall have executed and delivered the other Loan  Documents to which such Credit Party is required to be a party (including all  schedules and other documents to be delivered pursuant hereto); and this  Agreement, the Notes (if any) and the other Loan Documents shall be in full force  and effect.  (b) Corporate Authority.  Administrative Agent shall have received from each  Credit Party and the Parent, a certificate of its Secretary dated as of the Effective Date as  to:  (i) corporate resolutions (or the equivalent) of the Parent and each  Credit Party authorizing the transactions contemplated by this Agreement and the  other Loan Documents, in each case to which the Parent or such Credit Party is  party, and authorizing the execution and delivery of this Agreement and the other  Loan Documents, and in the case of Borrower, authorizing the execution and  delivery of any Request for Revolving Credit Advances and the issuance of Letters  of Credit hereunder,  (ii) the incumbency and signature of the officers or other authorized  persons of the Parent and such Credit Party executing any Loan Document and in  the case of Borrower, the officers who are authorized to execute any Request for  Revolving Credit Advance, or requests for the issuance of Letters of Credit,  (iii) a certificate of good standing or continued existence (or the  equivalent thereof) from the state of its incorporation or formation, and from every  state or other jurisdiction where the Parent and such Credit Party are qualified to do  business, which jurisdictions are listed on Schedule 5.1(b)(iii) attached hereto, and  (iv) copies of the Parent’s and such Credit Party’s Organizational  Documents as in effect on the Effective Date.  

 

  84134605.9   MRC Energy Company Credit Agreement 59  (c) Collateral Documents, Guaranties and other Loan Documents.   Administrative Agent shall have received the following documents, each in form and  substance reasonably satisfactory to Administrative Agent and fully executed by each party  thereto:  (i) The Guaranty fully executed by each party thereto and dated as of  the Effective Date.  (ii) The Pledge Agreement fully executed by each party thereto  covering the Equity Interests of each Restricted Subsidiary and the other Collateral  described therein, and dated as of the Effective Date.  (iii) Mortgages duly executed by each party thereto with respect to the  Oil and Gas Properties of the Credit Parties, or the portion thereof, as required by  Section 7.17 and amendments and/or assignments to each of the Existing  Mortgages as reasonably requested by Administrative Agent.  (iv) Copies of Uniform Commercial Code requests for information, or a  similar search report certified by a party reasonably acceptable to Administrative  Agent, dated a date reasonably prior to the Effective Date, listing all effective  financing statements in the jurisdictions required by Administrative Agent which  name any Credit Party (under their present names or under any previous names  used within five (5) years prior to the date hereof) as debtors, together with  (x) copies of such financing statements, and (y) authorized Uniform Commercial  Code (Form UCC-3) Termination Statements, if any, necessary to release all Liens  and other rights of any Person in any Collateral described in the Collateral  Documents previously granted by any Person (other than Liens permitted by  Section 8.2).  (v) Any documents (including, without limitation, financing statements,  amendments to financing statements and assignments of financing statements,  stock powers executed in blank and any endorsements) requested by  Administrative Agent and reasonably required to be provided in connection with  the Collateral Documents to create, in favor of Administrative Agent (for and on  behalf of Lenders), a first priority (subject to Liens permitted by  Section 8.2) perfected security interest in the Collateral thereunder shall have been  filed, registered or recorded, or shall have been delivered to Administrative Agent  in proper form for filing, registration or recordation.  (d) Insurance.  Administrative Agent shall have received evidence reasonably  satisfactory to it that the Credit Parties have obtained the insurance policies required by  Section 7.5 and that such insurance policies are in full force and effect.  (e) No Default.  On the Effective Date, no Default or Event of Default shall  exist.  (f) Opinions of Counsel.  The Parent and the Credit Parties shall furnish  Administrative Agent prior to the initial Advance under this Agreement, opinions of  

 

  84134605.9   MRC Energy Company Credit Agreement 60  counsel to the Parent and the Credit Parties (including local counsel opinions), to the extent  reasonably deemed necessary by Administrative Agent, in each case dated the Effective  Date and covering such matters as reasonably required by and otherwise reasonably  satisfactory in form and substance to Administrative Agent.  (g) Payment of Fees.  Borrower shall have paid to RBC and its Affiliates any  fees due under the terms of the Fee Letter, along with any other reasonable and documented  out-of-pocket fees, costs or expenses due and outstanding to Administrative Agent as of  the Effective Date (including reasonable and documented fees, disbursements and other  charges of counsel to Administrative Agent).  (h) Financial Statements.  Borrower shall have delivered to Lenders and  Administrative Agent, in form and substance reasonably satisfactory to Administrative  Agent:  (a) audited financial statements of Parent and its consolidated Subsidiaries for the  Fiscal Year ending December 31, 2020, and presented in accordance with GAAP, and the  quarterly financial statements of Parent and its consolidated Subsidiaries for the Fiscal  Quarter ended September 30, 2021 and (b) cash flow projections of Borrower through  December 31, 2022, in form reasonably acceptable to Administrative Agent.  (i) Due Diligence.  Administrative Agent and Lenders shall have received, in  each case in form and substance reasonably satisfactory to Administrative Agent,  engineering reports and other reserve information covering the Oil and Gas Properties of  the Credit Parties, including, without limitation, a Reserve Report dated as of July 1, 2021.  (j) Closing Certificate.  Administrative Agent shall have received a certificate  (which may be combined with the certificate required under Section 5.1(b)) of a  Responsible Officer of Borrower dated the Effective Date, stating that to the best of his or  her respective knowledge, (a) the representations and warranties made by the Parent and  the Credit Parties in this Agreement or any of the other Loan Documents, as applicable,  are true and correct in all material respects (except to the extent such representation and  warranty is already qualified by materiality or by a “Material Adverse Effect” clause, in  which case such representation and warranty shall be true and correct in all respects); (b) no  Default or Event of Default shall have occurred and be continuing; and (c) since December  31, 2020, nothing has occurred which has had, or would reasonably be expected to have, a  Material Adverse Effect.  (k) Title Due Diligence.  Administrative Agent shall have received title  opinions and other title information and data reasonably acceptable to Administrative  Agent covering not less than 85% of the value of the Mortgaged Properties included in the  Borrowing Base, reflecting title to the Hydrocarbon Interests of the Credit Parties in such  Mortgaged Properties which is reasonably acceptable to Administrative Agent.  (l) Customer Identification Forms.  Administrative Agent shall have received  completed customer identification forms (forms to be provided by Administrative Agent  to Borrower) from Parent, Borrower and each Guarantor.  

 

  84134605.9   MRC Energy Company Credit Agreement 61  (m) Beneficial Ownership Certification.  To the extent the Borrower qualifies  as a “legal entity customer” under the Beneficial Ownership Regulation, Administrative  Agent shall have received a Beneficial Ownership Certification in relation to the Borrower.  5.2 Conditions to Each Advance and Letter of Credit.  The obligations of each Lender  to make each Advance (including the initial Advance) under this Agreement and the obligation of  the Issuing Lenders to issue or renew any Letter of Credit shall, in each case, be subject to the  following conditions:  (a) No Default or Event of Default shall exist as of the date of the Advance or  the request for the issuance or renewal of the Letter of Credit, as the case may be;  (b) Each of the representations and warranties contained in this Agreement and  in each of the other Loan Documents shall be true and correct in all material respects  (except to the extent such representation and warranty is already qualified by materiality  or by a “Material Adverse Effect” clause, in which case such representation and warranty  shall be true and correct in all respects) as of the date of the Advance or Letter of Credit  (as the case may be) as if made on and as of such date (other than any representation or  warranty that expressly speaks only as of a different date);  (c) After giving effect to such Advance or Letter of Credit, the Aggregate  Credit Exposure will not exceed the Revolving Credit Aggregate Commitment; and  (d) Solely with respect to any Revolving Credit Advance pursuant to Section  2.1 (but not, for avoidance of doubt any continuation or conversion of Revolving Credit  Advances), immediately after giving effect to such Advance and giving effect to any other  transactions occurring prior to, or substantially simultaneously with, such Advance, the  Consolidated Cash Balance shall not exceed the Consolidated Cash Balance Threshold.  Each borrowing of an Advance by, and issuance of a Letter of Credit on behalf of, Borrower  hereunder shall constitute a representation and warranty by Borrower as of the date of such  extension of credit that the conditions contained in this Section 5.2 have been satisfied.  ARTICLE 6. REPRESENTATIONS AND WARRANTIES.  Borrower represents and warrants to Administrative Agent, Lenders and the Issuing  Lenders as follows:  6.1 Corporate Authority.  Each Credit Party and the Parent (a) is a limited liability  company, partnership or corporation duly organized, legally existing and in good standing under  the laws of the state or jurisdiction of its incorporation, formation or organization, as applicable,  (b) is duly qualified and authorized to do business as a foreign limited liability company,  partnership or corporation (or other business entity) in each jurisdiction where the character of its  assets or the nature of its activities makes such qualification and authorization necessary except  where failure to be so qualified or be in good standing could not reasonably be expected to have a  Material Adverse Effect, (c) has all requisite partnership, limited liability company or corporate  power, as applicable, and has all material governmental consents, approvals, licenses and  authorizations necessary in all material respects to carry on its business and own its material assets  

 

  84134605.9   MRC Energy Company Credit Agreement 62  as now being or as proposed to be conducted and (d) has all requisite partnership, limited liability  company or corporate power, as applicable, and authority to own all its material property (whether  real, personal, tangible or intangible or of any kind whatsoever).  6.2 Due Authorization.  (a) Each Credit Party and the Parent has all necessary partnership, limited  liability company or corporate power, as applicable, to execute, deliver and perform its  obligations under the Loan Documents to which it is a party,  (b) The execution, delivery and performance by the Parent and each Credit  Party of the Loan Documents, to which it is a party, (i) have been duly authorized by all  necessary organizational action, and (ii) are not in contravention in any material respect of  any law applicable to the Parent or such Credit Party or the terms of the Parent’s or such  Credit Party’s Organizational Documents.  6.3 Good Title; Leases; Assets; No Liens.  On the Effective Date (except as disclosed  in Schedule 6.3) and thereafter except as disclosed to Administrative Agent:  (a) Each Credit Party, to the extent applicable, has good and defensible title to  the material Hydrocarbon Interests and Oil and Gas Properties evaluated in the Reserve  Report most recently provided to Administrative Agent, in each case free and clear of all  Liens except the Liens permitted by Section 8.2;  (b) Each Credit Party has good title to, or valid leasehold interests in, all of its  (i) real property that is not real property referenced in clause(a) preceding and that is  material to the business of the Credit Parties taken as a whole and (ii) personal property  that is material to the business of the Credit Parties taken as a whole, in each case of (i) and  (ii) preceding, except for Liens permitted by Section 8.2;  (c) (i) On the Effective Date, no material condemnation, eminent domain or  expropriation action has been commenced or threatened against any owned or leased real  property; and (ii) after the Effective Date, no material condemnation, eminent domain or  expropriation action has been commenced or threatened against any such owned or leased  real property that could reasonably be expected to have a Material Adverse Effect; and  (d) There are no Liens on, and no financing statements on file, with respect to  any of the assets owned by the Credit Parties, except for the Liens permitted by Section 8.2  of this Agreement.  6.4 Taxes.  Parent, Borrower and each Restricted Subsidiary has timely filed or caused  to be filed all Federal, State and other tax returns that are required to be filed and has paid or caused  to be paid all federal, state and other taxes, assessments and other governmental charges levied or  imposed upon them or their properties, income or assets otherwise due and payable, except, in  each case, (a) those which are being contested in good faith by appropriate proceedings and for  which Parent, Borrower or such Restricted Subsidiary, as applicable, has set aside on its books  adequate reserves in accordance with GAAP or (b) to the extent that the failure to do so could not  reasonably be expected to result in a Material Adverse Effect.  

 

  84134605.9   MRC Energy Company Credit Agreement 63  6.5 No Defaults.  To the Borrower’s knowledge, neither Borrower nor any Restricted  Subsidiary is in default, nor has any event or circumstance occurred which, but for the expiration  of any applicable grace period or the giving of notice, would constitute a default under any material  agreement, instrument or undertaking to which it is a party or by which any of them or any of their  property is bound, in each case which would reasonably be expected to cause a Material Adverse  Effect.  6.6 Enforceability.  This Agreement and each of the other Loan Documents to which  the Parent or any Credit Party is a party, have each been duly executed and delivered by its duly  authorized officers and constitute the valid and binding obligations of the Parent and such Credit  Party, enforceable against the Parent or such Credit Party (as applicable) in accordance with their  respective terms, except as enforcement thereof may be limited by applicable bankruptcy,  reorganization, insolvency, fraudulent conveyance, moratorium or similar laws affecting the  enforcement of creditor’s rights, generally and by general principles of equity (regardless of  whether enforcement is considered in a proceeding in law or equity).  6.7 Compliance with Laws.  (a) Each of the Credit Parties and the Parent is in compliance with (i) all  Requirements of Law, and (ii) its Organizational Documents, except, in each case of  clause (i) and (ii) preceding, to the extent that failure to comply therewith could not  reasonably be expected to have a Material Adverse Effect;  (b) On the Effective Date, no Credit Party is liable for any material refunds or  interest thereon as a result of any order from the Federal Energy Regulatory Commission  or any Governmental Authority with respect to any pipeline system;  (c) Except for such acts or failures to act as would not reasonably be expected  to have a Material Adverse Effect, the Oil and Gas Properties (and properties unitized  therewith) of the Credit Parties have been maintained, operated and developed in a good  and workmanlike manner and in conformity with all applicable laws and all rules,  regulations and orders of all duly constituted authorities having jurisdiction and in  conformity with the provisions of all leases, subleases or other contracts comprising a part  of the Oil and Gas Properties and other contracts and agreements forming a part of the Oil  and Gas Properties; and  (d) No Credit Party or the Parent, nor, any Related Party, (i) is currently the  subject of any Sanctions, (ii) is located, organized or residing in any Designated  Jurisdiction, or (iii) is or has been (within the previous five (5) years) engaged in any  transaction with any Person who is now or was then the subject of Sanctions or who is  located, organized or residing in any Designated Jurisdiction.  Borrower has not directly or  indirectly used the proceeds of any Advance or loaned, contributed or otherwise made  available such proceeds to any Subsidiary, Affiliate or other Person, to fund any activity or  business in any Designated Jurisdiction or to fund any activity or business of any Person  located, organized or residing in any Designated Jurisdiction or who is the subject of any  Sanctions, or in any other manner that will result in any violation by any Person (including  any Lender, the Administrative Agent or any Issuing Lender) of Sanctions.  

 

  84134605.9   MRC Energy Company Credit Agreement 64  6.8 Non-contravention.  (a) The execution, delivery and performance of this Agreement and the other  Loan Documents by the Parent and each Credit Party (as applicable) will not violate in any  material respect any Requirement of Law.  (b) The execution, delivery and performance of this Agreement and the other  Loan Documents (including each Request for Revolving Credit Advance) to which the  Parent and each Credit Party is a party are not in contravention of the terms of any material  Contractual Obligation, indenture, agreement or other instrument evidencing Material Debt  or any other undertaking to which the Parent or such Credit Party is a party or by which it  or its properties are bound where, in the case of any of the foregoing, such violation could  reasonably be expected to have a Material Adverse Effect.  6.9 Litigation.  Except as disclosed on Schedule 6.9 or to Administrative Agent  hereafter in writing, there are no suits, actions or proceedings by or before any arbitrator or  Governmental Authority, including, without limitation, any bankruptcy proceeding, or  governmental investigations, pending against or, to the knowledge of Borrower, threatened against  or affecting the Parent or any Credit Party (i) as to which there is a reasonable possibility of an  adverse determination and that, if adversely determined, could reasonably expected, individually  or in the aggregate, to result in a Material Adverse Effect (taking into account insurance or other  recoveries) or (ii) that involve this Agreement or any other Loan Documents or any of the  transactions contemplated hereby or thereby.  6.10 Consents, Approvals and Filings, etc.  (a) No material authorizations, permits, consents, approvals, licenses,  qualifications or formal exemptions from, nor any material filing, declaration or  registration with, any court, Governmental Authority or any Person are necessary for the  execution, delivery and performance: (i) by the Parent or any Credit Party of this  Agreement and any of the other Loan Documents to which the Parent or such Credit Party  is a party or (ii) by the Credit Parties of the grant of Liens granted, conveyed or otherwise  established (or to be granted, conveyed or otherwise established) by or under this  Agreement or the other Loan Documents, as applicable, except for the recording and filing  of the Collateral Documents as required by this Agreement.  (b) No authorizations, permits, consents, approvals, licenses, qualifications or  formal exemptions from, nor any filing, declaration or registration with, any court,  Governmental Authority or any Person are necessary for the operation of any Credit Party’s  business, except in each case (i) such matters which have been previously obtained, and  (ii) those the failure of which to obtain could not reasonably be expected to result in a  Material Adverse Effect.  6.11 No Investment Company or Margin Stock.  No Credit Party is, nor is the Parent,  engaged and will not engage, principally or as one of its important activities, in the business of  purchasing or carrying margin stock (within the meaning of Regulation U issued by the Board of  Governors of the Federal Reserve System of the United States) or extending credit for the purpose  

 

  84134605.9   MRC Energy Company Credit Agreement 65  of purchasing or carrying margin stock.  None of the proceeds of any of the Advances will be used  by any Credit Party to purchase or carry margin stock.  No Credit Party or the Parent is or is  required to be registered as an “investment company” under the Investment Company Act of 1940,  as amended.  6.12 ERISA.  No Credit Party or Parent maintains or contributes to any Pension Plan  subject to Title IV of ERISA, except as set forth on Schedule 6.12 hereto or otherwise disclosed  to Administrative Agent in writing.  Except as could not, individually or in the aggregate,  reasonably be expected to have a Material Adverse Effect:  (a) There is no accumulated funding deficiency within the meaning of  Section 412 of the Internal Revenue Code or Section 302 of ERISA, or any outstanding  liability with respect to any Pension Plans owed to the PBGC other than future premiums  due and owing pursuant to Section 4007 of ERISA, and no “reportable event” as defined  in Section 4043(c) of ERISA has occurred with respect to any Pension Plan, other than an  event for which the notice requirement has been waived by the PBGC;  (b) Each Pension Plan is being maintained and funded in accordance with its  terms and is in compliance with the requirements of the Internal Revenue Code and ERISA;  (c) None of the Credit Parties or Parent has engaged in a prohibited transaction  with respect to any Pension Plan, other than a prohibited transaction for which an  exemption is available and has been obtained, which could subject such Credit Parties or  the Parent to a material tax or penalty imposed by Section 4975 of the Internal Revenue  Code or Section 502(i) of ERISA; and  (d) No Credit Party or Parent has had a complete or partial withdrawal from  any Multiemployer Plan.  6.13 Conditions Affecting Business or Properties.  Neither the respective businesses nor  the properties of any Credit Party is affected by any fire, explosion, accident, strike, lockout or  other dispute, drought, storm, hail, earthquake, embargo, act of God, or other casualty that could  reasonably be expected to have a Material Adverse Effect.  6.14 Environmental and Safety Matters.  Except (i) as set forth in Schedule 6.14 or as  otherwise disclosed to the Lenders in writing or (ii) as would not have a Material Adverse Effect:  (a) all facilities and property owned or leased by the Credit Parties are in  compliance with all Hazardous Material Laws;  (b) there have been no unresolved and outstanding past, and there are no  pending or threatened:  (i) claims, complaints, notices or requests for information received by  any Credit Party with respect to any alleged violation of any Hazardous Material  Law, or  

 

  84134605.9   MRC Energy Company Credit Agreement 66  (ii) written complaints, notices or inquiries to any Credit Party regarding  potential liability of any Credit Parties under any Hazardous Material Law; and  (c) no conditions exist at, on or under any property now or previously owned  or leased by any Credit Party which, with the passage of time, or the giving of notice or  both, are reasonably likely to give rise to liability under any Hazardous Material Law or  create a significant adverse effect on the value of the property.  6.15 Subsidiaries.  Except as disclosed on Schedule 6.15 hereto as of the Effective Date,  and thereafter, except as disclosed to Administrative Agent in writing from time to time, no Credit  Party or the Parent has any Subsidiaries.  As of the Effective Date, each Subsidiary that is an  Unrestricted Subsidiary is listed as such on Schedule 6.15 and is designated so in accordance with  the terms of this Agreement.  After the Effective Date, the Administrative Agent has received  prompt written notice of the existence of each Unrestricted Subsidiary formed, acquired, created  or converted after the Effective Date.  6.16 Capital Structure.  Schedule 6.16 attached hereto sets forth all issued and  outstanding Equity Interests of each Credit Party, including the number of authorized, issued and  outstanding Equity Interests of each Credit Party, the par value of such Equity Interests and the  holders of such Equity Interests, all on and as of the Effective Date.  All issued and outstanding  Equity Interests of each Credit Party are duly authorized and validly issued, fully paid,  nonassessable, free and clear of all Liens (except for the benefit of Administrative Agent) and such  Equity Interests were issued in compliance with all applicable state, federal and foreign laws  concerning the issuance of securities.  Except as disclosed on Schedule 6.16, there are no  preemptive or other outstanding rights, options, warrants, conversion rights or similar agreements  or understandings for the purchase or acquisition from any Credit Party, of any Equity Interests of  any Credit Party.  6.17 Accuracy of Information.  (a) The audited financial statements for the Fiscal Year ended December 31,  2020, and the unaudited consolidated financial statements at September 30, 2021, furnished  to Administrative Agent and Lenders prior to the Effective Date fairly present in all  material respects the financial condition of Parent and its Subsidiaries and the results of  their operations for the periods covered thereby, and have been prepared in accordance  with GAAP (subject, in the case of the interim financial statements, to normal year-end  adjustments, including tests for impairment of assets and lack of footnotes).  (b) Since December 31, 2020, there has been no change, circumstance or event  that has had a Material Adverse Effect.  6.18 Solvency.  After giving effect to the transactions contemplated hereby, (a) the  assets (after giving effect to amounts that could reasonably be received by reason of indemnity,  offset, insurance or any similar arrangement), at a fair market valuation, of the Parent and the  Credit Parties on a consolidated basis will exceed the aggregate Debt of the Parent and the Credit  Parties on a consolidated basis, as the Debt becomes absolute and matures, (b) the Parent and the  Credit Parties on a consolidated basis will not have incurred or intended to incur Debt beyond their  

 

  84134605.9   MRC Energy Company Credit Agreement 67  ability to pay such Debt (after taking into account the timing and amounts of cash to be received  by Parent and each of the Credit Parties and the amounts to be payable on or in respect of their  liabilities, and giving effect to amounts that could reasonably be received by reason of indemnity,  offset, insurance or any similar arrangement) as such Debt becomes absolute and matures and  (c) the Parent and the Credit Parties on a consolidated basis will not have unreasonably small  capital for the conduct of their business taken as a whole.  6.19 No Misrepresentation.  The written information, statements, exhibits, certificates,  documents and reports, taken as a whole, furnished to the Administrative Agent and the Lenders  (or any of them) by Borrower, any other Credit Party or Parent in connection with the negotiation  or administration of this Agreement or any other Loan Document, or any other transaction  contemplated hereby, do not contain any material misstatement of a material fact and do not omit  to state a material fact or any fact necessary to make the statement contained therein not materially  misleading in the light of the circumstances in which made and with respect to Borrower and its  Restricted Subsidiaries taken as a whole.  All projections and pro-forma financial information  contained in the documents and materials referenced above are based upon good faith estimates  and assumptions believed by management of Borrower to be reasonable at the time made, it being  recognized by Administrative Agent and Lenders that such financial information as it relates to  future events is not to be viewed as fact and that actual results during the period or periods covered  by such financial information may differ from the projected results set forth therein by a material  amount.  There is no fact, other than information known to the public generally, known to any  Credit Party, that could reasonably be expected to have a Material Adverse Effect that has not  expressly been disclosed to Administrative Agent in writing.  Neither Borrower nor any Restricted  Subsidiary or Parent is in default nor has any event or circumstance occurred which, but for the  expiration of any applicable grace period or the giving of notice, or both, would constitute a default  under any material agreement or instrument to which the Parent or any Credit Party is a party or  by which the Parent or any Credit Party is bound which default could reasonably be expected to  have a Material Adverse Effect.  6.20 Engineering Reports.  Each Credit Party executing a Mortgage owns or will own  (subject to Liens permitted by Section 8.2), the net interest and production attributable to the  material Mortgaged Properties evaluated in the engineering reports it has most recently furnished  to Administrative Agent.  The ownership of such properties shall not in the aggregate in any  material respect obligate such Credit Party to bear costs and expenses relating to the maintenance,  development and operations of such properties in an amount materially in excess of the working  interests of such properties as shown in such engineering reports most recently furnished to  Administrative Agent.  Each Credit Party executing a Mortgage has paid all royalties payable  under the oil and gas leases to which it is an operator, except (a) those contested in accordance  with the terms of the applicable joint operating agreement or otherwise contested in good faith by  appropriate proceedings, or (b) to the extent such failure would not reasonably be expected to  cause or result in a Material Adverse Effect.  Upon delivery of each Reserve Report furnished to  Lenders pursuant to Section 7.15, the statements made in the preceding sentences of this  Section 6.20 shall be true with respect to such Reserve Reports.  6.21 Gas Balancing Agreements and Advance Payment Contracts.  Except as set forth  on Schedule 6.21, as of the Effective Date, (a) there is no Material Gas Imbalance, and (b) the  

 

  84134605.9   MRC Energy Company Credit Agreement 68  aggregate amount of all Advance Payments received by any Credit Party under Advance Payment  Contracts which have not been satisfied by delivery of production does not exceed $1,000,000.  6.22 Commodity Hedging Agreements.  Schedule 6.22(a) sets forth, as of the Effective  Date, a true and complete list of all Commodity Hedging Agreements (other than Excluded  Hedges) of the Credit Parties, the material terms thereof (including the type, term, effective date,  termination date and notional amounts or volumes), the net mark to market value thereof (as of  September 30, 2021), all credit support agreements relating thereto (including any margin required  or supplied), and the counterparty to each such agreement.  6.23 Corporate Documents and Corporate Existence.  As to the Parent and each Credit  Party, (a) it is an organization as described on Schedule 6.23 hereto and has provided  Administrative Agent with complete and correct copies of its Organizational Documents in effect  on the Effective Date, and, if applicable, a good standing certificate within 30 days of the Effective  Date and (b) its correct legal name, business address, type of organization and jurisdiction of  organization, tax identification number and organization identification number from its  jurisdiction of organization (i) as of the Effective Date, are set forth on Schedule 6.23 hereto or (ii)  after the Effective Date, as disclosed to Administrative Agent in writing.  ARTICLE 7. AFFIRMATIVE COVENANTS.  Borrower covenants and agrees, so long as any Lender has any commitment to extend  credit hereunder, or any of the Indebtedness remains outstanding and unpaid (excluding contingent  reimbursement and indemnification obligations for which no claim has been made and Lender  Hedging Obligations and Lender Product Obligations) that it will, and, as applicable, it will cause  each of its Restricted Subsidiaries to:  7.1 Financial Statements.  Furnish to Administrative Agent, for delivery to each  Lender, the following documents:  (a) as soon as available, but in any event within ninety (90) days after the end  of each Fiscal Year, a copy of the audited Consolidated balance sheet of Parent and its  Subsidiaries as at the end of such Fiscal Year and the related audited Consolidated  statements of income, equity, and cash flows of Parent and its Subsidiaries for such Fiscal  Year, setting forth in each case in comparative form the figures for the previous Fiscal  Year, certified by KPMG or another independent, nationally recognized certified public  accounting firm reasonably satisfactory to Administrative Agent; and  (b) as soon as available, but in any event within sixty (60) days after the end of  each Fiscal Quarter of the Credit Parties (excluding the last quarter of each Fiscal Year)  subject to standard audit adjustments, Borrower prepared unaudited Consolidated balance  sheet of Parent and its Subsidiaries as at the end of such Fiscal Quarter and the related  unaudited statements of income, equity and cash flows of Parent and its Subsidiaries for  the portion of the Fiscal Year through the end of such Fiscal Quarter, setting forth in each  case in comparative form the figures for the corresponding periods in the previous Fiscal  Year, and certified by a Responsible Officer of Borrower as being fairly stated in all  material respects (subject to year-end audit adjustments).  

 

  84134605.9   MRC Energy Company Credit Agreement 69  All such financial statements shall be complete and correct in all material respects and be prepared  in reasonable detail and in accordance with GAAP throughout the periods reflected therein and  with prior periods (except as approved by a Responsible Officer and disclosed therein), provided  however that the financial statements delivered pursuant to clause (b) hereof will not be required  to include footnotes and will be subject to change for audit and year-end adjustments.  Documents required to be delivered pursuant to this Section 7.1 or Section 7.2 (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 (1) on which  Borrower posts such documents, or provides a link thereto, on Borrower’s website on the Internet  at http://www.matadorresources.com or (2) on which such documents are posted on Borrower’s  behalf on an Internet or intranet website, if any, to which each Lender and the Administrative  Agent have access (whether a commercial, third-party website or whether sponsored by the  Administrative Agent); provided that Borrower shall notify the Administrative Agent (by  telecopier or electronic mail) of the posting of any such documents and, upon request, provide to  the Administrative Agent by electronic mail electronic versions (i.e., soft copies) of such  documents.  If requested by the Administrative Agent, Borrower shall be required to provide paper  copies of the Compliance Certificates required by Section 7.2(a) to the Administrative Agent.    Borrower hereby acknowledges that (a) the Administrative Agent may, but shall not be obligated  to, make available to the Lenders and the Issuing Lenders materials and/or information provided  by or on behalf of Borrower hereunder (collectively, “Borrower Materials”) by posting Borrower  Materials on Debt Domain, IntraLinks, Syndtrak or another similar electronic system (the  “Platform”) and (b) certain of the Lenders (each, a “Public Lender”) may have personnel who do  not wish to receive material non-public information with respect to Borrower or its Affiliates, or  the respective securities of any of the foregoing, and who may be engaged in investment and other  market-related activities with respect to such Persons’ securities.  Borrower hereby agrees that  (w) all Borrower Materials that are to be made available to Public Lenders shall be clearly and  conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word “PUBLIC” shall  appear prominently on the first page thereof; provided that such Public Lenders identify  themselves as such in writing to Borrower and Administrative Agent; (x) by marking Borrower  Materials “PUBLIC,” Borrower shall be deemed to have authorized the Administrative Agent, any  Joint Lead Arranger, any Issuing Lender and the Lenders to treat such Borrower Materials as not  containing any material non-public information with respect to Borrower or its securities for  purposes of United States Federal and state securities laws (provided, however, that to the extent  such Borrower Materials constitute Information, they shall be treated as set forth in Section 13.10);  (y) all Borrower Materials marked “PUBLIC” are permitted to be made available through a portion  of the Platform designated “Public Side Information;” and (z) the Administrative Agent and the  Joint Lead Arrangers shall be entitled to treat any Borrower Materials that are not marked  “PUBLIC” as being suitable only for posting on a portion of the Platform not designated “Public  Side Information.”  Notwithstanding the foregoing, Borrower shall be under no obligation to mark  any Borrower Materials “PUBLIC”.  7.2 Certificates; Other Information.  Furnish to Administrative Agent, for delivery to  each Lender, the following documents:  

 

  84134605.9   MRC Energy Company Credit Agreement 70  (a) Concurrently with the delivery of the financial statements described in  Sections 7.1(a) for each Fiscal Year end, and 7.1(b) for each Fiscal Quarter end, a  Compliance Certificate duly executed by a Responsible Officer;  (b) If at any time applicable, promptly upon its becoming available, each  financial statement, report, notice or proxy statement sent by Parent to its shareholders  generally and each regular or periodic report and any registration statement, prospectus or  written communication (other than transmittal letters) in respect thereof filed by Parent  with or received by Parent in connection therewith from any securities exchange or the  SEC or any successor agency;  (c) Promptly after the furnishing or receipt thereof, copies of any material  statement, report or notice furnished to or received from any Person pursuant to the terms  of any indenture, loan or credit or other similar agreement evidencing Material Debt, other  than this Agreement and not otherwise required to be furnished to the Lenders pursuant to  any other provision of this section (including a copy of any notice of default received from  any holder or holders of any Senior Notes or any trustee or agent on its or their behalf, to  the extent such notice has not otherwise been delivered to the Administrative Agent  hereunder);  (d) Upon reasonable request of the Administrative Agent, within thirty  (30) days after the end of each month (the “Reported Month”), a monthly report, in form  and substance satisfactory to the Majority Lenders, indicating the Reported Month’s  production volumes for each well on the Oil and Gas Properties of the Credit Parties, sales  volumes, sales revenues, production taxes, operating expenses and net operating income  from production from such Oil and Gas Properties, with detailed calculations and  worksheets;  (e) Concurrently with the delivery of financial statements under Sections 7.1(a)  and 7.1(b), a certificate of a Responsible Officer of Borrower, in form and substance  reasonably satisfactory to Administrative Agent, setting forth as of the last day of such  Fiscal Quarter or Fiscal Year, as applicable, a true and complete list of all Commodity  Hedging Agreements (other than Excluded Hedges) of the Credit Parties, the material  terms thereof (including the type, term, effective date, termination date and notional  amounts or volumes), the net mark to market value thereof (as of the last day of such fiscal  quarter or fiscal year), any new credit support agreements relating thereto not listed on  Schedule 6.22(a) (including any margin required or supplied), and the counterparty to each  such agreement; and  (f) Issuance of Senior Notes.  In the event the Parent or any Credit Party intends  to issue Senior Notes (other than the initial Senior Notes issued or to be issued by the Parent  or any Senior Notes in exchange therefor) or refinance any existing Senior Notes with the  proceeds of any Permitted Refinancing, written notice of the intended offering promptly  following the launch thereof and in any event prior to the closing of such intended offering  of such Senior Notes or such Permitted Refinancing, the estimated amount thereof, and the  anticipated date of closing, and upon the written request of the Administrative Agent,  copies of the preliminary offering memorandum (if any) and the final offering  

 

  84134605.9   MRC Energy Company Credit Agreement 71  memorandum (if any) relating to such Senior Notes or Permitted Refinancing, as the case  may be.  (g) Such additional financial and/or other information regarding the Parent or  any Credit Party, or any of their properties or assets as Administrative Agent or any Lender  may from time to time reasonably request, promptly following such request.  7.3 Payment of Obligations.  Pay, discharge or otherwise satisfy, at or before maturity  or before they become delinquent, as the case may be, all of its obligations of whatever nature,  including without limitation all assessments, governmental charges, claims for labor, supplies, rent  or other obligations, except where (a) the failure to do so could not reasonably be expected to have  a Material Adverse Effect or (b) the amount or validity thereof is currently being appropriately  contested in good faith and reserves in conformity with GAAP with respect thereto have been  provided on the books of the Credit Parties.  7.4 Conduct of Business and Maintenance of Existence; Compliance with Laws.  (a) Preserve, renew and keep in full force and effect its existence except as  otherwise permitted pursuant to Section 8.3 and maintain its qualifications to do business  in each jurisdiction where such qualifications are necessary for its operations and the failure  to be so qualified would not be reasonably expected to result in a Material Adverse Effect;  (b) Take all action it deems necessary in its reasonable business judgment to  maintain all rights, privileges, licenses and franchises necessary for the normal conduct of  its business except where the failure to so maintain such rights, privileges or franchises  could not, either singly or in the aggregate, reasonably be expected to have a Material  Adverse Effect;  (c) Comply with all Contractual Obligations and Requirements of Law, except  to the extent that failure to comply therewith could not, either singly or in the aggregate,  reasonably be expected to have a Material Adverse Effect; and  (d) (i) Continue to be a Person whose property or interests in property is not  blocked or subject to blocking pursuant to Section 1 of Executive Order 13224 of  September 23, 2001 Blocking Property and Prohibiting Transactions With Persons Who  Commit, Threaten to Commit or Support Terrorism (66 Fed. Reg. 49079 (2001)) (the  “Order”), (ii) not engage in the transactions prohibited by Section 2 of that Order or  become associated with Persons such that a violation of Section 2 of the Order would arise,  and (iii) not become a Person on the list of Specially Designated National and Blocked  Persons, or (iv) otherwise not become subject to the limitation of any OFAC regulation or  executive order.  7.5 Maintenance of Property; Insurance.  (a) At its own expense, do or cause to be done all things reasonably necessary  to preserve and keep in good repair, working order and efficiency all of its material Oil and  Gas Properties and other material properties including, without limitation, all equipment,  machinery and facilities, and from time to time will make all the reasonably necessary  

 

  84134605.9   MRC Energy Company Credit Agreement 72  repairs, renewals and replacements so that at all times the state and condition of its material  Oil and Gas Properties and other material properties will be fully preserved and maintained,  except to the extent a portion of such properties is no longer capable of producing  Hydrocarbons in economically reasonable amounts.  (b) (i) Pay and discharge, or make reasonable and customary efforts to cause to  be paid and discharged, all delay rentals, royalties, expenses and indebtedness accruing  under the leases or other agreements affecting or pertaining to its material Oil and Gas  Properties, (ii) perform or make reasonable and customary efforts to cause to be performed,  in accordance with industry standards, the obligations required by each and all of the  assignments, deeds, leases, sub leases, contracts and agreements affecting its material  interests in its material Oil and Gas Properties and other material properties, (iii) cause  each Subsidiary to do all other things necessary to keep unimpaired in all material respects,  its rights with respect to its material Oil and Gas Properties and other material properties,  and prevent any forfeiture thereof or a default thereunder, except in each case (A) for Liens  permitted by the terms of Section 8.2, (B) to the extent a portion of such properties is no  longer capable of producing Hydrocarbons in economically reasonable amounts and  (C) for Dispositions permitted by Section 8.4.  (c) Operate its material Oil and Gas Properties and other material properties or  cause or make reasonable and customary efforts to cause such material Oil and Gas  Properties and other material properties to be operated in a careful and efficient manner in  accordance with the practices of the industry and in compliance with all applicable  contracts and agreements and in compliance in all material respects with all Requirements  of Law.  Notwithstanding the foregoing, with respect to those Borrowing Base Properties which are  being operated by operators other than a Credit Party, Borrower and the other Credit Parties  shall not be obligated to perform any undertakings contemplated by the covenants and  agreements contained herein which are performable only by such operators and are beyond  the control of Borrower or such Credit Party, as applicable; provided, however, Borrower  and the other Credit Parties agree to promptly take all reasonable actions available under  any operating agreements or otherwise to bring about the performance of any such  undertakings required to be performed under this Section.  (d) Maintain, with financially sound and reputable insurance companies,  insurance in such amounts and against such risks as are customarily maintained by  companies engaged in the same or similar businesses operating in the same or similar  locations.  The loss payable clauses or provisions in said insurance policy or policies  insuring any of the Collateral shall name Administrative Agent as lender loss payee and  such policies shall name the Administrative Agent as “additional insured”; provided, that  if no Default shall have occurred and be continuing, Borrower or any Restricted Subsidiary  may use the proceeds of casualty insurance to repair or replace assets or otherwise reinvest  such proceeds in its business.  7.6 Inspection of Property; Books and Records, Discussions.  Permit any  representatives designated by the Administrative Agent or any Lender, upon reasonable prior  

 

  84134605.9   MRC Energy Company Credit Agreement 73  notice, to visit and inspect its properties, to examine and make extracts from its books and records,  and to discuss its affairs, finances and condition with its officers and independent accountants, all  at such reasonable times and as often as reasonably requested, provided that an officer of Borrower  may be present at any such discussion with such independent accountants.  Reasonable costs and  expenses of such inspections and examinations shall be paid by Borrower, provided, however, that  prior to the occurrence and continuance of an Event of Default, Borrower shall only be obligated  to pay for the out-of-pocket and documented reasonable costs and expenses of one inspection and  examination by the Administrative Agent per Fiscal Year.  7.7 Notices.  Promptly give written notice to Administrative Agent of:  (a) the occurrence of any Default or Event of Default of which any Credit Party  has knowledge;  (b) any litigation or proceeding existing at any time between the Parent and any  Credit Party, on the one hand, and any Governmental Authority or other third party, on the  other hand, or any investigation of the Parent or any Credit Party conducted by any  Governmental Authority, of which Borrower has knowledge and which in any case if  adversely determined would have a Material Adverse Effect;  (c) the occurrence of any event which any Credit Party believes could  reasonably be expected to have a Material Adverse Effect, promptly after concluding that  such event could reasonably be expected to have such a Material Adverse Effect;  (d) any damage to the Oil and Gas Properties in excess of the Threshold  Amount in the aggregate per occurrence;  (e) any event of which Borrower has knowledge giving rise to an obligation for  Borrower to make a mandatory prepayment hereunder; and  (f) any change in the information provided in any Beneficial Ownership  Certification delivered to such Lender that would result in a change to the list of beneficial  owners identified in such certification.  Each notice pursuant to this Section shall be accompanied by a statement of a Responsible Officer  of Borrower setting forth details of the occurrence referred to therein and, in the case of notices  referred to in clauses (a), (b), (c), (d), and (e) hereof stating what action the applicable Credit Party  has taken or proposes to take with respect thereto.  7.8 Hazardous Material Laws.  (a) Use and operate (or cause to be operated) all of its facilities and properties  in material compliance with applicable Hazardous Material Laws, keep all material  required permits, approvals, certificates, licenses and other authorizations required under  such Hazardous Material Laws in effect and remain in compliance therewith, and handle  Hazardous Materials in material compliance with all applicable Hazardous Material Laws  except to the extent the failure to do any of the foregoing would not reasonably be expected  to have a Material Adverse Effect; and  

 

  84134605.9   MRC Energy Company Credit Agreement 74  (b) To the extent necessary to comply in all material respects with Hazardous  Material Laws, remediate or monitor contamination arising from a release or disposal of  Hazardous Material, which solely, or together with other releases or disposals of Hazardous  Materials could reasonably be expected to have a Material Adverse Effect.  7.9 Financial Covenants.  (a) Total Debt to Consolidated EBITDA Ratio.  Maintain, as of the last day of  each Fiscal Quarter, commencing with the first Fiscal Quarter ending after the Effective  Date, a Total Debt to Consolidated EBITDA Ratio of not more than 3.50 to 1.00.  (b) Current Ratio.  Maintain, as of the last day of each Fiscal Quarter, a Current  Ratio of not less than 1.00 to 1.00.  7.10 Governmental and Other Approvals.  Apply for, obtain and/or maintain in effect,  as applicable, all authorizations, consents, approvals, licenses, qualifications, exemptions, filings,  declarations and registrations (whether with any court, Governmental Authority, regulatory  authority, securities exchange or otherwise) which are necessary or reasonably requested by  Administrative Agent in connection with the execution, delivery and performance by the Parent or  any Credit Party, as applicable, of this Agreement, the other Loan Documents, or any other  documents or instruments to be executed and/or delivered by the Parent or any Credit Party, as  applicable in connection therewith or herewith, except where the failure to so apply for, obtain or  maintain could not reasonably be expected to have a Material Adverse Effect.  7.11 Compliance with ERISA; ERISA Notices.  (a) Comply in all material respects with all material requirements imposed by  ERISA and the Internal Revenue Code, including, but not limited to, the minimum funding  requirements for any Pension Plan, except to the extent that any noncompliance could not  reasonably be expected to have a Material Adverse Effect.  (b) Promptly notify Administrative Agent upon the occurrence of any of the  following events of which Borrower has knowledge if any such event or events would  reasonably be expected to have a Material Adverse Effect: (i) the termination, other than a  standard termination, as defined in ERISA, of any Pension Plan subject to Subtitle C of  Title IV of ERISA by any Credit Party; (ii) the appointment of a trustee by a United States  District Court to administer any Pension Plan subject to Title IV of ERISA; (iii) the  commencement by the PBGC, of any proceeding to terminate any Pension Plan subject to  Title IV of ERISA; (iv) the failure of any Credit Party to make any payment in respect of  any Pension Plan required under Section 412 of the Internal Revenue Code or Section 302  of ERISA; (v) the withdrawal of any Credit Party from any Multiemployer Plan if any  Credit Party reasonably believes that such withdrawal would give rise to the imposition of  Withdrawal Liability with respect thereto; or (vi) the occurrence of (x) a “reportable event”  which is required to be reported by a Credit Party under Section 4043 of ERISA other than  any event for which the reporting requirement has been waived by the PBGC or (y) a  “prohibited transaction” as defined in Section 406 of ERISA or Section 4975 of the Internal  

 

  84134605.9   MRC Energy Company Credit Agreement 75  Revenue Code other than a transaction for which a statutory exemption is available or an  administrative exemption has been obtained.  7.12 Future Restricted Subsidiaries; Additional Collateral.  (a) Within thirty (30) days after the date any Person becomes a Restricted  Subsidiary (or such longer time period as Administrative Agent may determine), whether  by acquisition, an Unrestricted Subsidiary becoming a Restricted Subsidiary or otherwise,  cause such new Restricted Subsidiary to execute and deliver to Administrative Agent, for  and on behalf of each of the Secured Parties (unless waived by Administrative Agent) a  joinder agreement to the Guaranty whereby such Restricted Subsidiary shall become  obligated as a Guarantor under the Guaranty; and  (b) Within thirty (30) days after the date any Person becomes a Restricted  Subsidiary (or such longer time period as Administrative Agent may determine), whether  by acquisition, an Unrestricted Subsidiary becoming a Restricted Subsidiary or otherwise,  Borrower shall (i) in the event Borrower is the owner of the Equity Interests of such  Restricted Subsidiary, pledge such Equity Interests to Administrative Agent, for the benefit  of the Secured Parties pursuant to a pledge agreement in form and substance satisfactory  to the Administrative Agent (or a joinder to the Pledge Agreement), (ii) in the event that a  Credit Party (other than Borrower) is the owner of such Equity Interests, cause such Credit  Party to execute and deliver a pledge agreement in form and substance satisfactory to the  Administrative Agent (or a joinder to the Pledge Agreement) and pledge such Equity  Interests to the Administrative Agent, for the benefit of the Secured Parties, and (iii) take,  or cause to be taken, such action as may be necessary to perfect the Liens created pursuant  to any such pledge agreement, including the Pledge Agreement, on such Equity Interests.  Borrower will also deliver, or cause to be delivered, to Administrative Agent such supporting  documentation, including without limitation corporate authority items, certificates and opinions of  counsel, as may be reasonably required by Administrative Agent in connection with the actions  required under this Section 7.12.  Upon Administrative Agent’s reasonable request, Borrower shall  take, or cause to be taken, such additional steps as are necessary under applicable law to perfect  and ensure the validity and priority of the Liens granted under this Section 7.12.  7.13 Use of Proceeds.  Use all Advances of the Revolving Credit as set forth in  Section 2.12.  Borrower shall not use any portion of the proceeds of any such Advances for the  purpose of purchasing or carrying any “margin stock” (as defined in Regulation U of the Board of  Governors of the Federal Reserve System) in any manner which violates the provisions of  Regulation T, U or X of said Board of Governors or for any other purpose in violation of any  applicable statute or regulation.  7.14 Further Assurances and Information.  (a) Promptly execute and deliver, and cause the Parent and each Restricted  Subsidiary to promptly execute and deliver, to Administrative Agent all such other  documents, agreements and instruments reasonably requested by the Administrative Agent  or the Majority Lenders to effectuate more fully the purposes and intent of this Agreement  

 

  84134605.9   MRC Energy Company Credit Agreement 76  and the other Loan Documents, or to comply with, cure any defects, or accomplish the  covenants and agreements of the Parent, Borrower or any Restricted Subsidiary, as the case  may be, in this Agreement and the other Loan Documents, or to further evidence and more  fully describe the collateral intended as security for the Indebtedness, or to correct any  omissions in this Agreement or any other Loan Document, or to state more fully the  obligations secured in any of the Collateral Documents, or to perfect, protect or preserve  any Liens created pursuant to this Agreement or any of the Collateral Documents or the  priority thereof, or to make any recordings, file any notices or obtain any consents, all as  may be necessary or appropriate in connection therewith.  (b) Provide Administrative Agent and Lenders with (i) any other information  required by Section 326 of the USA Patriot Act or necessary for Administrative Agent and  Lenders to verify the identity of the Parent or any Credit Party as required by Section 326  of the USA Patriot Act and (ii) information and documentation (including, without  limitation, a Beneficial Ownership Certification) reasonably requested by the  Administrative Agent or any Lender for purposes of compliance with applicable “know  your customer” and anti-money laundering rules and regulations, including the USA  Patriot Act and the Beneficial Ownership Regulation.  7.15 Reserve Reports.  (a) On March 1 and September 1 of each year, commencing March 1, 2022,  Borrower shall furnish to Administrative Agent and Lenders a Reserve Report dated as of  the preceding January 1 of that year for the Reserve Report due March 1 and as of the  preceding July 1 of that year for the Reserve Report due September 1.  Each Reserve Report  required to be delivered on March 1 of each year shall be prepared by or audited by  Netherland, Sewell & Associates, Inc. or another independent petroleum consulting firm  reasonably acceptable to Administrative Agent.  Each other Reserve Report shall be  prepared by Borrower’s in-house staff under the supervision of the appropriate officer who  shall certify such Reserve Report to be true and accurate in all material respects and, except  as disclosed therein, to have been prepared in accordance with the methodology and  procedures used in the immediately preceding January 1 Reserve Report.  (b) In the event of any special determination of the Borrowing Base under  Section 4.4, Borrower shall furnish to Administrative Agent and Lenders a Reserve Report  prepared by Borrower’s in-house staff under the supervision of the appropriate officer who  shall certify such Reserve Report to be true and accurate in all material respects and, except  as disclosed therein, and to have been prepared in accordance with the methodology and  procedures used in the immediately preceding Reserve Report.  Borrower shall provide  such Reserve Report with an “as of” date as reasonably requested by Administrative Agent  as soon as possible, but in any event no later than sixty (60) days following the receipt of  the reasonable request by Administrative Agent.  For any special determination requested  by Borrower pursuant to Section 4.4, the “as of” date shall be not more than 120 days  preceding the date of delivery of the corresponding Reserve Report.  (c) With the delivery of each Reserve Report, Borrower shall provide to  Administrative Agent and Lenders, a certificate from a Responsible Officer certifying on  

 

  84134605.9   MRC Energy Company Credit Agreement 77  behalf of Borrower that in all material respects:  (i) the information contained in the  Reserve Report and any other information delivered in connection therewith is true and  correct, (ii) the Credit Parties own good and defensible title to the Borrowing Base  Properties evaluated in such Reserve Report (which shall note which Oil and Gas  Properties are Mortgaged Properties) and such Borrowing Base Properties are free of all  Liens except for Liens permitted under Section 8.2, (iii) except as set forth on an exhibit to  the certificate, on a net basis there are no Material Gas Imbalances and the aggregate  amount of all Advance Payments received by any Credit Party under Advance Payment  Contracts that have not been satisfied by delivery of production does not exceed  $1,000,000, and (iv) none of their Borrowing Base Properties evaluated in the most recent  Reserve Report have been sold since the date of the last Borrowing Base determination  except as set forth on an exhibit to the certificate, which certificate shall list (A) all  Borrowing Base Properties sold, (B) all Borrowing Base Properties added to and deleted  from the immediately prior Reserve Report, showing any change in working interest or net  revenue interest and the reason for such change, and (C) all Persons disbursing proceeds to  the Credit Parties from the Borrowing Base Properties.  7.16 Title Information and Mortgage Coverage.  (a) Delivery.  On or before the delivery to Administrative Agent and Lenders  of each Reserve Report required by Section 7.15, Borrower will deliver title information  in form and substance reasonably acceptable to Administrative Agent covering enough of  the Oil and Gas Properties evaluated by such Reserve Report that were not included in the  immediately preceding Reserve Report, so that Administrative Agent shall have received  together with title information previously delivered to Administrative Agent, reasonably  satisfactory title information on at least 85% of the value of the Oil and Gas Properties  evaluated by such Reserve Report and constituting Mortgaged Properties.  (b) Cure of Title Defects.  Upon reasonable request by Administrative Agent,  Borrower shall cure any title defects or exceptions which are not Liens permitted under  Section 8.2 and which in the reasonable discretion of Administrative Agent render the title  to the Mortgaged Properties not good and defensible (except for Liens permitted by Section  8.2), or substitute acceptable Borrowing Base Properties of an equivalent value, with no  title defects or exceptions except for Liens permitted under Section 8.2, within ninety  (90) days after a reasonable request by Administrative Agent or Lenders to cure such  defects or exceptions.  (c) Failure to Cure Title Defects.  If Borrower is unable to cure any title defect  required to be cured under Section 7.16(b) above as reasonably requested by  Administrative Agent or Lenders to be cured within the 90-day period or Borrower does  not comply with the requirements to provide reasonably acceptable title information  covering 85% of the value of the Oil and Gas Properties evaluated in the most recent  Reserve Report and constituting Mortgaged Properties, such default shall not be a Default  or an Event of Default, but instead Administrative Agent and Lenders shall have the right  to exercise the following remedy in their sole discretion from time to time, and any failure  to so exercise this remedy at any time shall not be a waiver as to future exercise of the  remedy by Administrative Agent or Lenders.  To the extent that Administrative Agent or  

 

  84134605.9   MRC Energy Company Credit Agreement 78  the Majority Lenders are not satisfied with title to any Mortgaged Property after the time  period in Section 7.15(b) has elapsed, such unacceptable Mortgaged Property shall not  count towards the 85% requirement, and Administrative Agent may send a notice to  Borrower and Lenders that the then outstanding Borrowing Base shall be reduced by an  amount as reasonably determined by Administrative Agent with the concurrence of the  Supermajority Lenders to cause Borrower to be in compliance with the requirement to  provide reasonably acceptable title information on 85% of the value of the Mortgaged  Properties.  This new Borrowing Base shall become effective immediately after receipt of  such notice.  7.17 Collateral.  (a) Collateral.  The Indebtedness shall be secured by a perfected first priority  Lien (subject only to Liens permitted under Section 8.2) granted to Administrative Agent  for the benefit of the Secured Parties on (i) no less than 85% of the value of Oil and Gas  Properties owned by the Credit Parties to which proved reserves of oil or gas are attributed  in the most recent Reserve Report, (ii) all tangible and intangible personal property of the  Credit Parties (other than Excluded Assets) located on or related to, any of the Mortgaged  Properties, (iii) all accounts receivable and other proceeds arising from the sale of  Hydrocarbons produced from the Mortgaged Properties, and (iv) the Equity Interests  directly or indirectly owned by the Credit Parties in any Restricted Subsidiary.  (b) Title Information.  Upon reasonable request by Administrative Agent in  connection with the granting of the Lien on Oil and Gas Properties referred to in clause  (a) above, Borrower will provide to Administrative Agent title information in form and  substance reasonably satisfactory to Administrative Agent with respect to such Credit  Party’s interests, provided that Borrower will not be required to provide title information  for more than 85% of the value of the Mortgaged Properties evaluated by the most recent  Reserve Report.  (c) Legal Opinions.  Promptly after the filing of any new Collateral Document  in any state, upon the reasonable request of Administrative Agent, Borrower will provide  to Administrative Agent an opinion of counsel addressed to Administrative Agent, for the  benefit of Lenders, in form and substance reasonably satisfactory to Administrative Agent,  stating that the Collateral Document is valid, binding, and enforceable in accordance with  its terms in legally sufficient form for such jurisdiction and containing such other matters  as reasonably requested by Administrative Agent.  7.18 [Reserved].    7.19 Consolidated Cash Balance Information.  Upon the reasonable request of the  Administrative Agent, Borrower shall provide to the Administrative Agent (i) a certificate of a  Responsible Officer in substantially the form of Exhibit I, certifying as to the amount of the  Consolidated Cash Balance and the amount by which the Consolidated Cash Balance exceeds the  Consolidated Cash Balance Threshold, if any, as of such date, and (ii) attaching thereto, summary  and balance statements, in a form reasonably acceptable to the Administrative Agent, for each  deposit account, securities account, commodity account, or other account maintained at any  

 

  84134605.9   MRC Energy Company Credit Agreement 79  financial institution other than Administrative Agent in which any Consolidated Cash Balance is  held, credited or carried.  7.20 Post-Closing Covenant.  On or before ninety (90) days after the Effective Date (or  such later date as may be agreed by the Administrative Agent in its sole discretion), each Credit  Party shall have delivered to the Administrative Agent each Deposit Account Control Agreement  required to be provided pursuant to Section 4.10 of the Pledge Agreement with respect to any  deposit account maintained by any Credit Party as of the Effective Date (other than any Excluded  Accounts).  ARTICLE 8. NEGATIVE COVENANTS.  Borrower covenants and agrees that, so long as any Lender has any commitment to extend  credit hereunder, or any of the Indebtedness remains outstanding and unpaid (excluding contingent  reimbursement and indemnification obligations for which no claim has been made and Lender  Hedging Obligations and Lender Product Obligations), it will not, and, as applicable, it will not  permit any of its Restricted Subsidiaries to:  8.1 Limitation on Debt.  Create, incur, assume or suffer to exist any Debt, except:  (a) Debt of any Credit Party to Administrative Agent and/or any Secured Party  constituting Indebtedness;  (b) any Debt existing on the Effective Date and set forth in Schedule 8.1  attached hereto and any refinancing, refundings and renewals thereof (without increasing  the principal amount thereof);  (c) Debt of any Credit Party to finance the acquisition, construction or  improvement of any fixed or capital assets, including Capitalized Leases, provided that the  aggregate principal amount of Debt permitted by this Section 8.1(c) at any time outstanding  shall not exceed the greater of (i) $50,000,000 and (ii) 5% of the Borrowing Base, and any  renewals, extensions or refinancings of such Debt;  (d) [Intentionally Omitted];  (e) Debt arising from judgments that do not constitute a Default or Event of  Default under Section 9.1(h);  (f) Debt of Borrower or any Restricted Subsidiary to Parent, and intercompany  Debt among Borrower and its Subsidiaries;   (g) obligations to royalty, overriding and working interest owners, joint interest  obligations, trade payables and other lease operating expenses incurred in the ordinary  course of business which are not more than one hundred twenty (120) days past due or  which are being contested in good faith by appropriate action and for which adequate  reserves have been maintained in accordance with GAAP;  

 

  84134605.9   MRC Energy Company Credit Agreement 80  (h) Debt associated with bonds or sureties provided to any Governmental  Authority or to any other Person in connection with the operation of Oil and Gas Properties;  (i) Debt under Advance Payment Contracts permitted by Section 8.10;  (j) Debt in connection with the endorsement of negotiable instruments, cash  management and other similar obligations in respect of netting services, overdraft  protection and similar arrangements, in each case in the ordinary course of business;  (k) Debt associated with or in respect of workers’ compensation claims,   performance, bid, release, appeal and surety bonds and performance and completion  guarantees and similar obligations provided by Borrower or any of the Restricted  Subsidiaries, in each case in the ordinary course of business;  (l) Debt consisting of the financing of insurance premiums;  (m) Debt in respect of self-insurance obligations to the extent incurred in the  ordinary course of business in accordance with customary industry practices in amounts  customary in Borrower’s and its Restricted Subsidiaries’ industry;  (n) to the extent constituting Debt, indemnification, deferred purchase price  adjustments, earn-outs or similar obligations, in each case, incurred or assumed in  connection with the acquisition of any business or assets or any Investment permitted to be  acquired or made hereunder or any Disposition permitted hereunder;  (o) Debt representing deferred compensation or similar obligations to  employees of Parent and its Subsidiaries incurred in the ordinary course of business;  (p) Debt incurred in the ordinary course of business with respect to customer  deposits and other unsecured current liabilities not the result of borrowing and not  evidenced by any note or other evidence of Debt;  (q) unsecured Debt under the Senior Notes (and any Permitted Refinancing  thereof), including any Debt constituting guarantees thereof by any Credit Party; in an  aggregate principal amount not to exceed $1,100,000,000.00 at any time outstanding;  provided that (i) at the time of and immediately after giving effect to each issuance of  Senior Notes (and any Permitted Refinancing thereof), no Default shall have occurred and  be continuing and (ii) in connection with the issuance of Senior Notes, the Borrower shall  prepay the Loans and/or deposit cash collateral to the extent required pursuant to Section  2.10(c);  (r) guarantee obligations in respect of (i) Debt otherwise permitted pursuant to  this Section 8.1 and (ii) loans to employees of the Parent and its Subsidiaries for the  exercise of stock options, provided that, in the case of clause (ii), such loans shall not  exceed $1,000,000 in the aggregate at any time outstanding; and  

 

  84134605.9   MRC Energy Company Credit Agreement 81  (s) additional Debt in an aggregate principal amount outstanding for all such  Debt not to exceed at any time ten percent (10%) of the amount of the Borrowing Base  then in effect.  8.2 Limitation on Liens.  Create, incur, assume or suffer to exist any Lien upon any of  its property, assets or revenues, whether now owned or hereafter acquired, except for:  (a) Permitted Encumbrances;  (b) Liens securing Debt permitted by Section 8.1(c), provided that (i) such  Liens are created upon fixed or capital assets acquired, constructed or improved by the  applicable Credit Party after the date of this Agreement (including without limitation by  virtue of a loan or a Capitalized Lease), (ii) any such Lien is created solely for the purpose  of securing indebtedness representing or incurred to finance the cost of the acquisition of  the item of property subject thereto, (iii) the principal amount of the Debt secured by any  such Lien shall at no time exceed 100% of the sum of the purchase price or cost of the  applicable property, equipment or improvements and the related costs and charges imposed  by the vendors thereof and (iv) the Lien does not cover any property other than the fixed  or capital asset acquired (and proceeds and accessions and additions to such property);  (c) Liens created pursuant to the Loan Documents;  (d) other Liens, existing on the Effective Date, set forth on Schedule 8.2 and  renewals, refinancings and extensions thereof;  (e) Liens securing insurance premium financings, provided that no such Lien  may extend to or cover any property other than the insurance being acquired with such  financings, the proceeds thereof and any unearned or refunded insurance premiums related  thereto; and  (f) Liens on property not constituting Borrowing Base Properties or Collateral  or any proceeds thereof.  Regardless of the provisions of this Section 8.2, no Lien over the Equity Interests of any Restricted  Subsidiary of Borrower (except for those Liens for the benefit of Administrative Agent and the  other Secured Parties) shall be permitted under the terms of this Agreement.  8.3 Fundamental Changes.  Merge into or consolidate with any other Person, or permit  any other Person to merge into or consolidate with it, or Dispose of (in one transaction or in a  series of transactions) all or substantially all of its assets, or liquidate, wind up or dissolve, except  that:  (a) any Restricted Subsidiary may merge into Borrower in a transaction in  which Borrower is the continuing or surviving entity;  (b) any Restricted Subsidiary may merge into any other Restricted Subsidiary  or an Unrestricted Subsidiary, in each case only to the extent that the continuing or  surviving entity is a Restricted Subsidiary;  

 

  84134605.9   MRC Energy Company Credit Agreement 82  (c) Borrower or any Restricted Subsidiary may merge with or into any other  Person, provided that Borrower or a Restricted Subsidiary, as applicable, is the continuing  or surviving entity;  (d) any Restricted Subsidiary may Dispose of its assets to Parent, Borrower or  to another Restricted Subsidiary or any Unrestricted Subsidiary;   (e) Dispositions permitted by Section 8.4 may be made; and  (f) any Restricted Subsidiary may liquidate or dissolve if Borrower determines  in good faith that such liquidation or dissolution is in the best interests of Borrower or such  Restricted Subsidiary and any remaining assets are thereafter held by Borrower or another  Restricted Subsidiary.  8.4 Dispositions.  Dispose of any of the Borrowing Base Properties, whether now  owned or hereafter acquired, except:  (a) Dispositions of Hydrocarbons in the ordinary course of business;  (b) farmouts of undeveloped acreage and assignments in connection with such  farmouts;  (c) the Disposition of equipment and other property in the ordinary course of  business, in each case that is obsolete or no longer necessary in the business of any of the  Credit Parties or that is being replaced by equipment of comparable value and utility;  (d) Liens permitted by Section 8.2, Investments permitted by Section 8.6 and  Distributions permitted by Section 8.5;  (e) Dispositions permitted by Section 8.3;  (f) Dispositions of cash and Cash Equivalents in the ordinary course of  business;  (g) Borrower may Dispose of its Borrowing Base Properties to any Restricted  Subsidiary and any Restricted Subsidiary may Dispose of its Borrowing Base Properties to  Borrower or any other Restricted Subsidiary;  (h) sales or discounts of overdue accounts receivable in the ordinary course of  business;  (i) Dispositions of owned or leased vehicles in the ordinary course of business;  (j) Dispositions consisting of any compulsory pooling or unitization ordered  by a Governmental Authority with jurisdiction over the subject Oil and Gas Properties;  (k) other Dispositions of Borrowing Base Properties, provided that: (i) unless  such Disposition is a farmout, unitization, or exchange (or an assignment in connection  

 

  84134605.9   MRC Energy Company Credit Agreement 83  therewith), 90% of the consideration received in respect of such Disposition shall be cash,  (ii) the consideration received in respect of such Disposition shall be equal to or greater  than the fair market value of the Borrowing Base Property or interest therein, (iii) if such  Disposition of Borrowing Base Properties (or the Equity Interests of any Restricted  Subsidiary owning Borrowing Base Properties) during any period between two successive  scheduled redeterminations has a fair market value in excess of five percent (5%) of the  Borrowing Base then in effect (as reasonably determined by the Administrative Agent),  individually or in the aggregate for all such Borrowing Base Properties, the Borrowing  Base shall be reduced, effective immediately upon such Disposition, by an amount equal  to the value, if any, assigned such Borrowing Base Properties in the most recently delivered  Reserve Report, (iv) after giving effect to any reduction in the Borrowing Base pursuant to  clause (iii) above, Borrower shall use the Net Cash Proceeds received from such  Disposition to reduce the Aggregate Credit Exposure pursuant to and in accordance with  the terms of Section 2.10(c) and (v) immediately before and after giving effect thereto, no  Default shall have occurred and been continuing; and  (l) other Dispositions of Borrowing Base Properties having a fair market value  not to exceed $10 million in any fiscal year.  Lenders hereby consent and agree to the release by Administrative Agent of any and all Liens on  the property sold or otherwise Disposed of in compliance with this Section 8.4.  8.5 Restricted Payments.  Declare or make any distributions, dividend, payment or  other distribution of assets, properties, cash, rights, obligations or securities (collectively,  “Distributions”) on account of any of its Equity Interests, as applicable, or purchase, redeem or  otherwise acquire for value any of its Equity Interests, as applicable, or any warrants, rights or  options to acquire any of its Equity Interests, now or hereafter outstanding (collectively,  “Purchases” and together with Distributions, “Restricted Payments”), except that:  (a) each Credit Party may pay cash Distributions to Borrower or a Restricted  Subsidiary;  (b) Borrower and each Credit Party may declare and make Distributions  payable in the Equity Interests of such Person, provided that the issuance of such Equity  Interests does not otherwise violate the terms of this Agreement and no Default has  occurred and is continuing at the time of making such Distribution or would result from  the making of such Distribution;   (c) Borrower may declare and make Distributions to the Parent, provided that  either:  (i) (x) no Default has occurred and is continuing at the time of making  such Distribution or would result from the making of such Distribution and (y) the  aggregate amount of such Distributions shall not exceed $25,000,000 during any  Fiscal Year of Borrower, or  (ii) (x) no Default has occurred and is continuing at the time of making  such Distribution or would result from the making of such Distribution, (y) the  

 

  84134605.9   MRC Energy Company Credit Agreement 84  Borrower shall have a Total Debt to Consolidated EBITDA Ratio of not more than  3.00 to 1.00, calculated on a pro forma basis after giving effect to such Distribution  and (z) the Borrower shall have Liquidity, calculated on a pro forma basis after  giving effect to such Distribution, of not less than twenty percent (20%) of the  Revolving Credit Aggregate Commitments; and  (d) Borrower may declare and make Distributions to the Parent; provided,  however, that if an Event of Default has occurred and is continuing, Distributions to the  Parent during such period while an Event of Default exists must be used by the Parent only  for operational purposes.  8.6 Limitation on Investments, Loans and Advances.  Make or permit to remain  outstanding any loans, or advances to, or investments in (collectively, “Investments”), (whether  such investment shall be of the character of investment in shares of stock, evidences of  indebtedness or other securities or otherwise), or any loans or advances to, any Person, other than:  (a) Investments in cash and Cash Equivalents;  (b) Investments existing on the Effective Date and listed on Schedule 8.6;  (c) Investments (i) made by Borrower in any Restricted Subsidiary, any  Unrestricted Subsidiary or Parent, or (ii) made by any Restricted Subsidiary in Borrower,  any other Restricted Subsidiary, any Unrestricted Subsidiary or Parent;   (d) Investments in respect of Commodity Hedging Agreements and Interest  Rate Agreements permitted by Section 8.1(d);  (e) advances to employees of Parent and its Subsidiaries for travel, meals and  entertainment expenses in the ordinary course of business and loans to employees for the  purpose of exercise of stock options, all of which in the aggregate outstanding at any time  shall not exceed 2% of the amount of the Borrowing Base;  (f) the creation or acquisition of additional Restricted Subsidiaries made in  compliance with Section 7.12;  (g) demand deposits with financial institutions, prepaid expenses and  extensions of trade credit in the ordinary course of business (and any Investments received  in satisfaction or partial satisfaction thereof from financially troubled account debtors to  the extent reasonably necessary in order to prevent or limit loss);  (h) guarantee obligations permitted by Section 8.1;  (i) Investments by Borrower and its Restricted Subsidiaries that are  (i) customary in the oil and gas business, and (ii) made in the form of, or pursuant to, Oil  and Gas Properties, operating agreements, farm-in agreements, farm-out agreements,  mutual interest agreements, development agreements, unitization agreements, joint bidding  agreements, joint venture agreements, services contracts and other similar agreements;  

 

  84134605.9   MRC Energy Company Credit Agreement 85  (j) the acquisition of Oil and Gas Properties, equipment and other property, and  investments with respect to and relating to the production of oil, gas and other liquid or  gaseous Hydrocarbons from Oil and Gas Properties;  (k) the entry into operating agreements, working interests, royalty interests,  mineral leases, processing agreements, farm-out agreements, contracts for the sale,  transportation or exchange of oil and natural gas, unitization agreements, pooling  arrangements, area of mutual interest agreements, production sharing agreements or other  similar or customary agreements, transactions, properties, interests or arrangements, and  investments and expenditures in connection therewith or pursuant thereto in the ordinary  course of business;  (l) Investments representing the non-cash portion of the consideration received  for any Disposition of any assets permitted under Section 8.4;  (m) Investments (including, without limitation, capital contributions) in general  or limited partnerships or other types of entities or joint ventures entered into by Borrower  or a Restricted Subsidiary;  (n) extensions of trade credit in the ordinary course of business; and  (o) in addition to Investments otherwise expressly permitted by this Section,  Investments by Borrower or any of its Restricted Subsidiaries in an aggregate amount at  any time outstanding not to exceed the greater of (x) $25,000,000 or (y) two percent  (2%) of the amount of the Borrowing Base then in effect.  For purposes of determining compliance with this Section 8.6, the amount of any  Investment shall be the amount actually invested, without adjustment for subsequent increases or  decreases in the value of such Investment, but with adjustment for amounts actually returned in  cash to Borrower or the applicable Restricted Subsidiary on such Investment.  8.7 Transactions with Affiliates and Unrestricted Subsidiaries.  Except as set forth in  Schedule 8.7, enter into any transaction, including, without limitation, any purchase, sale, lease or  exchange of property or the rendering of any service, with any Unrestricted Subsidiary or any  Affiliate of the Credit Parties; provided that the foregoing restrictions shall not apply to:   (a) transactions among Borrower, Parent or Subsidiaries of Borrower that are Guarantors;  (b) transactions otherwise specifically permitted under this Agreement; (c) transactions in the  ordinary course of a Credit Party’s business and upon fair and reasonable terms no less favorable  to such Credit Party than it would obtain in a comparable arm’s length transaction from unrelated  third parties, (d) the payment of directors’ fees and indemnification and reimbursement of  expenses to directors, officers or employees; (e) any issuance of securities or other payments,  awards or grants in cash, securities or otherwise pursuant to, or the funding of, employment  agreements, stock options and stock ownership plans, and (f) employment and severance  arrangements entered into in the ordinary course of business between Borrower or any Subsidiary  and any employee thereof.  8.8 Limitations on Other Restrictions.  Enter into any agreement, document or  instrument which would (a) restrict the ability of any Restricted Subsidiary of Borrower to pay or  

 

  84134605.9   MRC Energy Company Credit Agreement 86  make dividends or distributions in cash or kind to Borrower or any other Restricted Subsidiary, to  make loans, advances or other payments of whatever nature to any Credit Party, or to make  transfers or distributions of all or any part of its assets to any Credit Party; or (b) restrict or prevent  any Credit Party from granting Administrative Agent on behalf of Lenders Liens upon, security  interests in and pledges of their respective assets, provided, however, that the preceding restrictions  will not apply to encumbrances or restrictions arising under or by reason of (i) this Agreement or  the other Loan Documents or the Senior Note Documents (or any documents evidencing or relating  to any Permitted Refinancing thereof), (ii) any agreements governing any Debt permitted by  Section 8.1(c) and any other purchase money Debt or Capitalized Leases otherwise permitted  hereby (in which case, any prohibition or limitation shall only be effective against the assets  financed by or the subject of such Debt and the proceeds and products thereof and all accessions  and attachments thereto), (iii) customary restrictions that arise in connection with any Disposition  permitted by Section 8.4 and applicable solely to the assets subject to such Disposition,  (iv) customary provisions in joint venture agreements and similar agreements that restrict transfer  of assets of, or Equity Interests in, joint ventures, (v) prohibitions and limitations that are binding  on a Restricted Subsidiary at the time such Restricted Subsidiary first becomes a Restricted  Subsidiary, so long as such prohibitions and limitations were not created in contemplation of such  Person becoming a Restricted Subsidiary and apply only to such Restricted Subsidiary,  (vi) restrictions with respect to Oil and Gas Properties that are not Borrowing Base Properties and  are not included in the most recent Reserve Report delivered pursuant to Section 4.3,  (vii) customary provisions contained in agreements that restrict assignment of such agreement  entered into in the ordinary course of business, (viii) customary provisions in leases, subleases,  licenses, sublicenses and similar contracts that restrict the transfer thereof or the transfer of the  assets subject thereto by the lessee, sublessee, licensee or sublicensee, and (ix) prohibitions and  limitations arising by operation of law.  8.9 Fiscal Year.   Permit the Fiscal Year of any Credit Party or Parent to end on a day  other than December 31.  8.10 Gas Balancing Agreements and Advance Payment Contracts.  Allow (a) any  Material Gas Imbalance and (b) the aggregate amount of all Advance Payments received by any  Credit Party under Advance Payment Contracts which have not been satisfied by delivery of  production to exceed $1,000,000.  8.11 Hedging Transactions.  Enter into any Commodity Hedging Agreements or Interest  Rate Agreements, except Commodity Hedging Agreements and Interest Rate Agreements entered  into with an Approved Counterparty in the ordinary course of business and not for speculative  purposes to:  (a) hedge or mitigate crude oil and condensate, natural gas and natural gas  liquids price risks to which Borrower or any Restricted Subsidiary has actual exposure  (whether or not treated as a hedge for accounting purposes under GAAP); provided that at  the time Borrower or any Restricted Subsidiary enters into any such Commodity Hedging  Agreement, such Commodity Hedging Agreement (A) does not have a term greater than  forty-eight (48) months from the date such Commodity Hedging Agreement is entered into,  and (B) when aggregated and netted with all other Commodity Hedging Agreements of  Borrower and its Restricted Subsidiaries then in effect would not cause the aggregate  

 

  84134605.9   MRC Energy Company Credit Agreement 87  notional volume per month for each of crude oil and condensate, natural gas and natural  gas liquids, calculated separately, under all Commodity Hedging Agreements then in effect  (other than Excluded Hedges) to exceed for any month during the forthcoming four year  period, eighty-five percent (85%) of the total anticipated production of Borrower and its  Restricted Subsidiaries, taken as a whole; and  (b) effectively cap, collar or exchange interest rates (from fixed to floating  rates, from one floating rate to another floating rate or otherwise) with respect to any  interest-bearing liability or investment of Borrower or any Restricted Subsidiary.  In no event shall any Commodity Hedging Agreement or Interest Rate Agreement entered  into by Borrower or any Restricted Subsidiary contain any requirement, agreement or covenant for  Borrower or any Restricted Subsidiary to post collateral or margin to secure their obligations under  such Commodity Hedging Agreement or Interest Rate Agreement, as the case may be, or to cover  market exposures; provided that this sentence shall not prevent (x) a Lender Counterparty from  requiring the obligations under any Commodity Hedging Agreement or Interest Rate Agreement  with Borrower or any Restricted Subsidiary to be secured by the Liens granted to Administrative  Agent pursuant to the Collateral Documents and (y) Borrower or any Restricted Subsidiary from  delivering letters of credit (including Letters of Credit issued by an Issuing Lender pursuant to this  Agreement) to secure their obligations under Commodity Hedging Agreements and Interest Rate  Agreements so long as the aggregate face amount of all such letters of credit, taken as a whole,  shall not exceed fifty percent (50%) of the Letter of Credit Maximum Amount at any time.  8.12 Nature of Business.  Permit any material change to be made in the character of its  business as an oil and gas exploration and production company and related businesses.  8.13 Senior Notes Restrictions.    (a) Except for regularly scheduled payments of interest required under the  Senior Notes, directly or indirectly, optionally or voluntarily retire, redeem, defease,  repurchase or prepay prior to the scheduled due date thereof any part of the principal of, or  interest on, the Senior Notes (or any Permitted Refinancing thereof); provided that so long  as no Default or Borrowing Base Deficiency has occurred and is continuing or would be  caused thereby, the Credit Parties may retire, redeem, defease, repurchase or prepay the  Senior Notes, in whole or in part, (x) with the proceeds of any Permitted Refinancing  permitted pursuant to Section 8.1(q) and/or with the Net Cash Proceeds of any issuance of  Equity Interests by the Parent or any of its Subsidiaries or (y) so long as the Borrower shall  have a Total Debt to Consolidated EBITDA Ratio of not more than 3.00 to 1.00, calculated  on a pro forma basis after giving effect thereto and the Borrower shall have Liquidity,  calculated on a pro forma basis after giving effect thereto, of not less than twenty percent  (20%) of the Revolving Credit Aggregate Commitments.  (b) Enter into or permit any modification or amendment of the Senior Note  Documents the effect of which is to (a) increase the maximum principal amount of the  Senior Notes or the rate of interest on any of the Senior Notes (other than as a result of the  imposition of a default rate of interest in accordance with the terms of the Senior Note  Documents), (b) change or add any event of default or any covenant with respect to the  

 

  84134605.9   MRC Energy Company Credit Agreement 88  Senior Note Documents if the effect of such change or addition is to cause any one or more  of the Senior Note Documents to be materially more restrictive on any Credit Party or any  of its Restricted Subsidiaries than such Senior Note Documents were prior to such change  or addition, (c) shorten the dates upon which payments of principal or interest on the Senior  Notes are due, (d) change any redemption or prepayment provisions of the Senior Notes,  (e) alter the subordination provisions, if any, with respect to any of the Senior Note  Documents, (f) grant any Liens in any assets of any Credit Party or any of its Subsidiaries,  or (g) permit any Subsidiary of any Credit Party to guarantee the Senior Notes unless such  Subsidiary is (or concurrently with any such guarantee becomes) a Guarantor hereunder.  ARTICLE 9. DEFAULTS.  9.1 Events of Default.  The occurrence of any of the following events shall constitute  an Event of Default hereunder:  (a) Borrower shall fail to pay when due or declared due any part of the principal  of any Advance and any such payment default shall continue unremedied for more than  one (1) Business Day;  (b) Borrower shall fail to pay when due or declared due any part of the interest  on any Advance and any such payment default shall continue unremedied for more than  three (3) Business Days;  (c) non-payment of any Reimbursement Obligation, fees or other amounts  (other than as set forth in subsection (a) above) due and owing by Borrower, any other  Credit Party or the Parent under this Agreement or by any Credit Party or the Parent under  any of the other Loan Documents to which it is a party, when and as the same shall become  due and payable, and such failure shall continue unremedied for a period of five  (5) Business Days after the same is due and payable;  (d) default in the observance or performance of any of the covenants or  agreements (as applicable) of Borrower set forth in Sections 7.1, 7.2(a), 7.4(a), 7.5(d),  7.7(a), 7.9, 7.13, 7.15, or Article 8 in its entirety, provided that an Event of Default arising  from a breach of Sections 7.1, 7.2(a) or 7.15 shall be deemed to have been cured upon  delivery of the required item; and provided further that any Event of Default arising solely  due to a breach of Section 7.7(a) shall be deemed cured upon the earlier of (x) the giving  of the notice required by Section 7.7(a) and (y) the date upon which the Default or Event  of Default giving rise to the notice obligation is cured or waived;  (e) default in the observance or performance of any of the other covenants or  agreements (as applicable) of the Parent or any Credit Party set forth in this Agreement or  any other Loan Document (other than those specified in clauses (a), (c) and (d) above) and  such default shall continue unremedied for a period of forty-five (45) consecutive days  after written notice thereof has been given to Borrower;  (f) any representation or warranty under the Loan Documents, including this  Agreement, or in any certificate or statement furnished or made to the Administrative  Agent or Lenders pursuant hereto, or in connection herewith, or in connection with any  

 

  84134605.9   MRC Energy Company Credit Agreement 89  document furnished hereunder, shall prove to be untrue in any material respect as of the  date on which such representation or warranty is made (or deemed made), or any  representation, statement (including financial statements), certificate, report or other data  furnished or made under any Loan Document, including this Agreement, proves to have  been untrue in any material respect, as of the date as of which the facts therein set forth  were stated or certified (except as such information shall have specifically been replaced  or modified);  (g) (i) default by Parent or any Credit Party in the payment of any Material  Debt, whether under a direct obligation or guaranty, and continuance thereof beyond any  applicable period of grace or cure, if any, provided in the instrument or agreement under  which such Material Debt was created or (ii) failure by Parent or any Credit Party to  observe or perform any other agreement contained in any instrument or agreement  evidencing or securing such Material Debt which continues beyond any applicable period  of grace or cure, if any, provided in the instrument or agreement under which such Material  Debt was created, and the effect of which would permit the holder or holders thereof to  accelerate such Material Debt, or require the prepayment, repurchase, redemption or  defeasance of such Material Debt; provided, that a default, event or condition described in  clause (i) or (ii)  of this paragraph (g) shall not constitute an Event of Default if any such  defaults, events or conditions are remedied or waived, prior to the exercise of any remedies  by Administrative Agent pursuant to Section 9.2 (other than the charging of interest at the  default rate specified herein), by the requisite holders or beneficiaries of such Material Debt  (or a trustee or agent on behalf of such holders or beneficiaries);  (h) A judgment (not paid or fully covered by insurance as to which the relevant  insurance company has not denied coverage in writing), for the payment of money in  excess of the Threshold Amount is rendered by any court or other governmental body  against Parent or any Credit Party and such Person does not discharge the judgment or  provide for its discharge in accordance with its terms, or procure a stay of execution thereof  within sixty (60) days from the date of entry thereof, and within said period of sixty  (60) days from the date of entry thereof or such longer period during which execution of  such judgment shall have been stayed, appeal therefrom and cause the execution thereof to  be stayed during such appeal while providing such reserves therefor as may be required  under GAAP;  (i) the occurrence of (i) a “reportable event”, as defined in ERISA, which is  determined by the PBGC to constitute grounds for a distress termination of any Pension  Plan subject to Title IV of ERISA maintained or contributed to by or on behalf of any  Credit Party for the benefit of any of its employees or for the appointment by the  appropriate United States District Court of a trustee to administer such Pension Plan and  such reportable event is not corrected and such determination is not revoked within sixty  (60) days after notice thereof has been given to the plan administrator of such Pension Plan  (without limiting any of Administrative Agent’s or any Lender’s other rights or remedies  hereunder), or (ii) the termination or the institution of proceedings by the PBGC to  terminate any such Pension Plan, or (iii) the appointment of a trustee by the appropriate  United States District Court to administer any such Pension Plan, or (iv) the reorganization  (within the meaning of Section 4241 of ERISA) or insolvency (within the meaning of  

 

  84134605.9   MRC Energy Company Credit Agreement 90  Section 4245 of ERISA) of any Multiemployer Plan, or receipt of notice from any  Multiemployer Plan that it is in reorganization or insolvency, or the complete or partial  withdrawal by any Credit Party from any Multiemployer Plan, which in the case of any of  the foregoing, could reasonably be expected to have a Material Adverse Effect;  (j) (i) except as expressly permitted under this Agreement, the Parent or any  Credit Party shall be dissolved or liquidated (or any judgment, order or decree therefor  shall be entered); or (ii) a creditors’ committee shall have been appointed for the business  of the Parent or any Credit Party; or (iii) the Parent or any Credit Party (A) shall have made  a general assignment for the benefit of creditors or (B) shall have been adjudicated  bankrupt and if not an adjudication based on a filing by the Parent or any Credit Party, as  applicable, it shall not have been dismissed within sixty (60) days, or (C) shall have filed  a voluntary petition in bankruptcy or for reorganization or to effect a plan or arrangement  with creditors, or (D) shall file an answer to a creditor’s petition or other petition filed  against it, admitting the material allegations thereof for an adjudication in bankruptcy or  for reorganization, or (E) shall have applied for or permitted the appointment of a receiver  or trustee or custodian for any of its property or assets; or (iv) a receiver, trustee or  custodian shall have been appointed for any of its property or assets (other than upon  application or consent of the Parent or any Credit Party, as applicable) and shall not have  been removed within sixty (60) days; or (v) an order shall be entered approving any petition  for reorganization of the Parent or any Credit Party (other than upon application or consent  of the Parent or any Credit Party, as applicable) and shall not have been reversed or  dismissed within sixty (60) days;  (k) a Change of Control;  (l) Borrower, any other Credit Party or the Parent shall admit in writing its  inability to, or be generally unable to, pay its debts as such debts become due; or  (m) the Loan Documents after delivery thereof shall for any reason, except to  the extent permitted by the terms hereof or thereof, cease to be in full force and effect and  valid, binding and enforceable in accordance with their terms (other than in accordance  with the terms hereof or thereof), or cease to create a valid and perfected Lien of the priority  required thereby on any material portion of the Collateral, except to the extent permitted  by the terms of this Agreement or any of the other Loan Documents, or Borrower, the  Parent or any Credit Party shall so state in writing.  9.2 Exercise of Remedies.  If an Event of Default has occurred and is continuing  hereunder:  (a) with the consent of the Majority Lenders, Administrative Agent may, and shall,  upon being directed to do so by the Majority Lenders, declare the Revolving Credit Aggregate  Commitment terminated; (b) with the consent of the Majority Lenders, Administrative Agent may,  and shall, upon being directed to do so by the Majority Lenders, declare the entire unpaid principal  Indebtedness, including the Notes (but excepting Indebtedness under Lender Hedging Obligations  and Lender Product Obligations), immediately due and payable, without presentment, notice or  demand, all of which are hereby expressly waived by Borrower; (c) upon the occurrence of any  Event of Default specified in Section 9.1(j) and notwithstanding the lack of any declaration by  Administrative Agent under preceding clauses (a) or (b), the entire unpaid principal Indebtedness  

 

  84134605.9   MRC Energy Company Credit Agreement 91  (excepting Indebtedness under Lender Hedging Obligations and Lender Product Obligations) shall  become automatically and immediately due and payable, and the Revolving Credit Aggregate  Commitment shall be automatically and immediately terminated; (d) Administrative Agent may,  and shall, upon being directed to do so by the Majority Lenders, demand immediate delivery of  cash collateral, and Borrower agrees to deliver such cash collateral upon demand, in an amount  equal to 100% of the maximum amount that may be available to be drawn at any time prior to the  stated expiry of all outstanding Letters of Credit, for deposit into an account controlled by  Administrative Agent; (e) Administrative Agent may, and shall, upon being directed to do so by  the Majority Lenders, notify Borrower or any Credit Party that interest shall be payable on demand  on all Indebtedness (other than (1) Revolving Credit Advances with respect to which Section 2.6  shall govern and (2) Lender Hedging Obligations and Lender Product Obligations) owing from  time to time to Administrative Agent or any Lender, at a per annum rate equal to the then applicable  Base Rate plus 2%; and (f) Administrative Agent may, and shall, upon being directed to do so by  the Majority Lenders or Lenders, as applicable (subject to the terms hereof), exercise any remedy  permitted by this Agreement, the other Loan Documents or law.  9.3 Rights Cumulative.  No delay or failure of Administrative Agent and/or Lenders in  exercising any right, power or privilege hereunder shall affect such right, power or privilege, nor  shall any single or partial exercise thereof preclude any further exercise thereof, or the exercise of  any other power, right or privilege.  The rights of Administrative Agent and Lenders under this  Agreement are cumulative and not exclusive of any right or remedies which Lenders would  otherwise have.  9.4 Waiver by Borrower of Certain Laws.  To the extent permitted by applicable law,  Borrower hereby agrees to waive, and does hereby absolutely and irrevocably waive and relinquish  the benefit and advantage of any valuation, stay, appraisement, extension or redemption laws now  existing or which may hereafter exist, which, but for this provision, might be applicable to any  sale made under the judgment, order or decree of any court, on any claim for interest on the Notes,  or any security interest or mortgage contemplated by or granted under or in connection with this  Agreement or any other Loan Document.  These waivers have been voluntarily given, with full  knowledge of the consequences thereof.  9.5 Waiver of Defaults.  No Event of Default shall be waived by Administrative Agent  and the Lenders except in accordance with Section 13.9.  No single or partial exercise of any right,  power or privilege hereunder, nor any delay in the exercise thereof, shall preclude other or further  exercise of their rights by Administrative Agent or Lenders.  No waiver of any Event of Default  shall extend to any other or further Event of Default.  No forbearance on the part of Administrative  Agent or Lenders in enforcing any of their rights shall constitute a waiver of any of their rights.   Borrower expressly agrees that this Section may not be waived or modified by Lenders or  Administrative Agent by course of performance, estoppel or otherwise.  9.6 Set Off.  Upon the occurrence and during the continuance of any Event of Default,  each Lender, each Issuing Lender and each of their respective Affiliates may at any time and from  time to time, without notice to Borrower but subject to the provisions of Section 10.3 (any  requirement for such notice being expressly waived by Borrower), setoff and apply any and all  deposits (general or special, time or demand, provisional or final, in whatever currency) at any  time held, and other obligations (in whatever currency) at any time owing by such Lender, such  

 

  84134605.9   MRC Energy Company Credit Agreement 92  Issuing Lender or any such Affiliate, to or for the credit or the account of Borrower or any other  Credit Party against any and all of the obligations of Borrower or such Credit Party now or  hereafter existing under this Agreement or any other Loan Document to such Lender, such Issuing  Lender or their respective Affiliates, irrespective of whether or not such Lender, such Issuing  Lender or Affiliate shall have made any demand under this Agreement or any other Loan  Document and although such obligations of Borrower or such Credit Party may be contingent or  unmatured or are owed to a branch, office or Affiliate of such Lender or such Issuing Lender  different from the branch, office or Affiliate holding such deposit or obligated on such  indebtedness.  Each Lender and each Issuing Lender agrees to notify Borrower and the  Administrative Agent promptly after any such setoff and application; provided that the failure to  give such notice shall not affect the validity of such setoff and application.  The rights of each  Lender, each Issuing Lender and their respective Affiliates under this Section 9.6 are in addition  to other rights and remedies (including other rights of setoff) that such Lender, such Issuing Lender  or their respective Affiliates may have.    ARTICLE 10. PAYMENTS, RECOVERIES AND COLLECTIONS.  10.1 Payment Procedure.   (a) All payments to be made by Borrower shall be made without condition or  deduction for any counterclaim, defense, recoupment or setoff.  Except as otherwise  provided herein, all payments made by Borrower of principal, interest or fees hereunder  shall be made without setoff or counterclaim on the date specified for payment under this  Agreement and must be received by Administrative Agent not later than 1:00 p.m. (New  York time) on the date such payment is required or intended to be made in Dollars in  immediately available funds to Administrative Agent at Administrative Agent’s office  identified on Schedule 13.6, for the ratable benefit of the Revolving Credit Lenders in the  case of payments in respect of the Revolving Credit and any Letter of Credit Obligations.   Any payment received by Administrative Agent after 1:00 p.m. (New York time) shall be  deemed received on the next succeeding Business Day and any applicable interest or fee  shall continue to accrue.  Upon receipt of each such payment, Administrative Agent shall  make prompt payment to each applicable Lender, or, in respect of Eurodollar-based  Advances, such Lender’s Eurodollar Lending Office, in like funds and currencies, of all  amounts received by it for the account of such Lender.  (b) Unless Administrative Agent shall have been notified in writing by  Borrower at least two (2) Business Days prior to the date on which any payment to be made  by Borrower is due that Borrower does not intend to remit such payment, Administrative  Agent may, in its sole discretion and without obligation to do so, assume that Borrower has  remitted such payment when so due and Administrative Agent may, in reliance upon such  assumption, make available to each Revolving Credit Lender on such payment date an  amount equal to such Lender’s share of such assumed payment.  If Borrower has not in  fact remitted such payment to Administrative Agent, each Lender shall forthwith on  demand repay to Administrative Agent the amount of such assumed payment made  available or transferred to such Lender, together with the interest thereon, in respect of each  day from and including the date such amount was made available by Administrative Agent  to such Lender to the date such amount is repaid to Administrative Agent at a rate per  

 

  84134605.9   MRC Energy Company Credit Agreement 93  annum equal to the Federal Funds Effective Rate for the first two (2) Business Days that  such amount remains unpaid, and thereafter at a rate of interest then applicable to such  Revolving Credit Advances.  (c) Subject to the definition of “Interest Period” in Section 1.1 of this  Agreement, whenever any payment to be made hereunder shall otherwise be due on a day  which is not a Business Day, such payment shall be made on the next succeeding Business  Day and such extension of time shall be included in computing interest, if any, in  connection with such payment.  10.2 Application of Proceeds of Collateral.  Notwithstanding anything to the contrary in  this Agreement, (x) in the case of any Event of Default under Section 9.1(j), immediately  following the occurrence and during the continuance thereof, (y) on and after the Revolving Credit  Maturity Date, and (z) in the case of any other Event of Default that is continuing:  (a) upon the termination of the Revolving Credit Aggregate Commitment, or  (b) the acceleration of any Indebtedness arising under this Agreement (other  than Commodity Hedging Agreements and Interest Rate Agreements), or  (c) at Administrative Agent’s option, or  (d) upon the request of the Majority Lenders after the commencement of any  remedies hereunder,  all proceeds realized from the liquidation or other disposition of Collateral or otherwise received  after maturity of the Indebtedness, whether by acceleration or otherwise, shall be applied:  (a) first, to payment or reimbursement of that portion of the Indebtedness  constituting reasonable fees, expenses and indemnities payable to the Administrative  Agent in its capacity as such;  (b) second, pro rata to payment or reimbursement of that portion of the  Indebtedness constituting reasonable fees, expenses and indemnities payable to the  Lenders;  (c) third, pro rata to payment of accrued interest on Advances;  (d) fourth, pro rata to payment of principal outstanding on Advances, and the  payment of Lender Hedging Obligations and Lender Product Obligations;  (e) fifth, pro rata to any other Indebtedness;  (f) sixth, to serve as cash collateral to be held by the Administrative Agent to  secure Reimbursement Obligations; and  (g) seventh, any excess, after all of the Indebtedness shall have been paid in full  in cash, shall be paid to Borrower or as otherwise required by law.  

 

  84134605.9   MRC Energy Company Credit Agreement 94  Notwithstanding the foregoing, amounts received from Parent or any Credit Party (or from their  respective assets) that is not an Eligible Contract Participant shall not be applied to any Excluded  Swap Obligations owing to a Lender Counterparty (it being understood, that in the event that any  amount is applied to Indebtedness as a result of this clause, the Administrative Agent shall make  such adjustments as it determines are appropriate to distributions pursuant to clause fourth above  from amounts received from such Eligible Contract Participants to ensure, as nearly as possible,  that the proportional aggregate recoveries with respect to Indebtedness described in clause fourth  above by Lender Counterparties that are the holders of any Excluded Swap Obligations are the  same as the proportional aggregate recoveries with respect to other Indebtedness pursuant to clause  fourth above).  10.3 Pro-rata Recovery.  Subject to Section 10.4(c), if any Lender shall obtain any  payment or other recovery (whether voluntary, involuntary, by application of setoff or  otherwise) on account of principal of, or interest on, any of the Advances made by it, or the  participations in Letter of Credit Obligations held by it in excess of its pro rata share of payments  then or thereafter obtained by all Lenders upon principal of and interest on all such Indebtedness,  such Lender shall purchase from the other Lenders such participations in the Revolving Credit  and/or the Letter of Credit Obligations held by them as shall be necessary to cause such purchasing  Lender to share the excess payment or other recovery ratably in accordance with the applicable  Revolving Credit Percentages of Lenders; provided, however, that if all or any portion of the  excess payment or other recovery is thereafter recovered from such purchasing holder, the  purchase shall be rescinded and the purchase price restored to the extent of such recovery, but  without interest.  10.4 Treatment of a Defaulting Lender; Reallocation of Defaulting Lender’s Fronting  Exposure.  (a) The obligation of any Lender to make any Advance hereunder shall not be  affected by the failure of any other Lender to make any Advance under this Agreement,  and no Lender shall have any liability to Borrower or any of their Subsidiaries,  Administrative Agent, any other Lender, or any other Person for another Lender’s failure  to make any loan or Advance hereunder.  (b) If any Lender shall become a Defaulting Lender, then such Defaulting  Lender’s right to vote in respect of any amendment, consent or waiver of the terms of this  Agreement or such other Loan Documents, or to approve or consent to any redetermination  of the Borrowing Base or to direct or approve any action or inaction by Administrative  Agent shall be subject to the restrictions set forth in Section 13.9.  (c) To the extent and for so long as a Lender remains a Defaulting Lender and  notwithstanding the provisions of Section 10.3 hereof, Administrative Agent shall be  entitled, without limitation, (i) to withhold or setoff and to apply in satisfaction of those  obligations for payment (and any related interest) in respect of which the Defaulting Lender  shall be delinquent or otherwise in default to Administrative Agent or any Lender (or to  hold as cash collateral for such delinquent obligations or any future defaults) the amounts  otherwise payable to such Defaulting Lender under this Agreement or any other Loan  Document, (ii) if the amount of Advances made by such Defaulting Lender is less than its  

 

  84134605.9   MRC Energy Company Credit Agreement 95  Revolving Credit Percentage requires, apply payments of principal made by Borrower  amongst the Non-Defaulting Lenders on a pro rata basis until all outstanding Advances are  held by all Lenders according to their respective Revolving Credit Percentages and (iii) to  bring an action or other proceeding, in law or equity, against such Defaulting Lender in a  court of competent jurisdiction to recover the delinquent amounts, and any related interest.   Furthermore, the rights and remedies of Borrower, Administrative Agent, the Issuing  Lenders, and the other Lenders against a Defaulting Lender under this Section shall be in  addition to any other rights and remedies such parties may have against the Defaulting  Lender under this Agreement or any of the other Loan Documents, applicable law or  otherwise, and Borrower waives no rights or remedies against any Defaulting Lender.  (d) If any Lender shall become a Defaulting Lender, then, for so long as such  Lender remains a Defaulting Lender, any Fronting Exposure shall be reallocated by  Administrative Agent at the request of any Issuing Lender among the Non-Defaulting  Lenders in accordance with their respective Revolving Credit Percentages of the Revolving  Credit, but only to the extent that the sum of the aggregate principal amount of all  Revolving Credit Advances made by each Non-Defaulting Lender, plus such  Non-Defaulting Lender’s Revolving Credit Percentage of the aggregate outstanding  principal amount of Letter of Credit Obligations prior to giving effect to such reallocation  plus such Non-Defaulting Lender’s Revolving Credit Percentage of the Fronting Exposure  to be reallocated does not exceed such Non- Defaulting Lender’s Revolving Credit  Percentage of the Revolving Credit Aggregate Commitment, and only so long as no Default  or Event of Default has occurred and is continuing on the date of such reallocation.  (e) If the Fronting Exposure of a Defaulting Lender is reallocated among the  Non-Defaulting Lenders pursuant to clause (d) above, then the fees payable to the Lenders  pursuant to Section 3.4(a)(i) shall be adjusted in accordance with such Non-Defaulting  Lenders’ reallocated Revolving Credit Percentages.  (f) In the event that each of Administrative Agent, Borrower and each Issuing  Lender agrees that a Defaulting Lender has adequately remedied all matters that caused  such Lender to be a Defaulting Lender, then any reallocation of the Fronting Exposure of  such Defaulting Lender pursuant to clause (d) above shall be readjusted to reflect the  inclusion of such Lender’s Revolving Credit Commitment Amount and on the date of such  readjustment such Lender shall purchase at par such of the Advances of the other Lenders  as the Administrative Agent shall determine may be necessary in order for such Lender to  hold such Advances in accordance with its Revolving Credit Percentage.  ARTICLE 11. CHANGES IN LAW OR CIRCUMSTANCES; INCREASED COSTS.  11.1 Reimbursement of Prepayment Costs.  If (i) Borrower makes any prepayment of  principal with respect to any Eurodollar-based Advance on any day other than the last day of the  Interest Period applicable thereto (whether voluntarily, pursuant to any mandatory provisions  hereof, by acceleration, or otherwise); (ii) Borrower converts or continues (or attempts to convert  or continue) any such Advance on any day other than the last day of the Interest Period applicable  thereto; (iii) Borrower fails to borrow, continue, refund or convert any Eurodollar-based Advance  after notice has been given by Borrower to Administrative Agent in accordance with the terms  

 

  84134605.9   MRC Energy Company Credit Agreement 96  hereof requesting such Advance; or (iv) if Borrower fails to make any payment of principal in  respect of a Eurodollar-based Advance when due, Borrower shall reimburse Administrative Agent  for itself and/or on behalf of any Lender, as the case may be, within ten (10) Business Days of  written demand therefor for any resulting loss, cost or expense incurred (excluding the loss of any  Applicable Margin) by Administrative Agent and Lenders, as the case may be, as a result thereof,  including, without limitation, any such loss, cost or expense incurred in obtaining, liquidating,  employing or redeploying deposits from third parties, whether or not Administrative Agent and  Lenders, as the case may be, shall have funded or committed to fund such Advance.  The amount  payable under this Section by Borrower to Administrative Agent for itself and/or on behalf of any  Lender, as the case may be, shall be deemed to equal an amount equal to the excess, if any, of  (a) the amount of interest which would have accrued on the amount so prepaid, or not so borrowed,  refunded, continued or converted, for the period from the date of such prepayment or of such  failure to borrow, continue, refund or convert, through the last day of the relevant Interest Period,  at the applicable rate of interest for said Advance(s) provided under this Agreement (excluding,  however, the Applicable Margin included therein, if any), over (b) the amount of interest (as  reasonably determined by Administrative Agent and Lenders, as the case may be) which would  have accrued to Administrative Agent and Lenders, as the case may be, on such amount by placing  such amount on deposit for a comparable period with leading banks in the interbank Eurocurrency  market.  Calculation of any amounts payable to any Lender under this paragraph shall be made as  though such Lender shall have actually funded or committed to fund the relevant Advance through  the purchase of an underlying deposit in an amount equal to the amount of such Advance and  having a maturity comparable to the relevant Interest Period; provided, however, that any Lender  may fund any Eurodollar-based Advance in any manner it deems fit and the foregoing assumptions  shall be utilized only for the purpose of the calculation of amounts payable under this paragraph.   Upon the written request of Borrower, Administrative Agent and Lenders shall deliver to Borrower  a certificate setting forth in reasonable detail the basis for determining such losses, costs and  expenses, which certificate shall be conclusively presumed correct, absent manifest error.  11.2 Eurodollar Lending Office.  For any Eurodollar-based Advance, if Administrative  Agent or a Lender, as applicable, shall designate a Eurodollar Lending Office which maintains  books separate from those of the rest of Administrative Agent or such Lender, Administrative  Agent or such Lender, as the case may be, shall have the option of maintaining and carrying the  relevant Advance on the books of such Eurodollar Lending Office.  11.3 Circumstances Affecting LIBOR Rate Availability.   (a) Benchmark Replacement.  (i) Notwithstanding anything to the contrary herein or in any other  Loan Document (and any Commodity Hedging Agreement or Interest Rate  Agreement shall be deemed not to be a “Loan Document” for purposes of this  Section 11.3), if a Benchmark Transition Event or an Early Opt-in Election, as  applicable, and its related Benchmark Replacement Date have occurred prior to the  Reference Time in respect of any setting of the then-current Benchmark, then (x) if  a Benchmark Replacement is determined in accordance with clause (1) or (2) of the  definition of “Benchmark Replacement” for such Benchmark Replacement Date,  such Benchmark Replacement will replace such Benchmark for all purposes  

 

  84134605.9   MRC Energy Company Credit Agreement 97  hereunder and under any Loan Document in respect of such Benchmark setting and  subsequent Benchmark settings without any amendment to, or further action or  consent of any other party to, this Agreement or any other Loan Document and (y)  if a Benchmark Replacement is determined in accordance with clause (3) of the  definition of “Benchmark Replacement” for such Benchmark Replacement Date,  such Benchmark Replacement will replace such Benchmark for all purposes  hereunder and under any Loan Document in respect of any Benchmark setting at or  after 5:00 p.m. (New York City time) on the fifth (5th) Business Day after the date  notice of such Benchmark Replacement is provided to the Lenders without any  amendment to, or further action or consent of any other party to, this Agreement or  any other Loan Document so long as Administrative Agent has not received, by  such time, written notice of objection to such Benchmark Replacement from  Lenders comprising the Majority Lenders.  (ii) Notwithstanding anything to the contrary herein or in any other  Loan Document and subject to the proviso below in this paragraph, if a Term SOFR  Transition Event and its related Benchmark Replacement Date have occurred prior  to the Reference Time in respect of any setting of the then-current Benchmark, then  Term SOFR will replace the then-current Benchmark for all purposes hereunder or  under any Loan Document in respect of such Benchmark setting and subsequent  Benchmark settings, without any amendment to, or further action or consent of any  other party to, this Agreement or any other Loan Document; provided that this  clause (ii) shall not be effective unless Administrative Agent has delivered to the  Lenders and Borrower a Term SOFR Notice.  (b) Benchmark Replacement Conforming Changes.  In connection with the  implementation of a Benchmark Replacement (including, for the avoidance of doubt, in  connection with the occurrence of a Term SOFR Transition Event), Administrative Agent  will have the right to make Benchmark Replacement Conforming Changes from time to  time and, notwithstanding anything to the contrary herein or in any other Loan Document,  any amendments implementing such Benchmark Replacement Conforming Changes will  become effective without any further action or consent of any other party to this Agreement  or any other Loan Document.  (c) Notices; Standards for Decisions and Determinations.  Administrative  Agent will promptly notify Borrower and the Lenders of (i) any occurrence of a Benchmark  Transition Event, a Term SOFR Transition Event or an Early Opt-in Election, as  applicable, and its related Benchmark Replacement Date, (ii) the implementation of any  Benchmark Replacement, (iii) the effectiveness of any Benchmark Replacement  Conforming Changes, (iv) the removal or reinstatement of any tenor of a Benchmark  pursuant to clause (d) below and (v) the commencement or conclusion of any Benchmark  Unavailability Period.  Any determination, decision or election that may be made by  Administrative Agent or, if applicable, any Lender (or group of Lenders) pursuant to this  Section 11.3, including any determination with respect to a tenor, rate or adjustment or of  the occurrence or non-occurrence of an event, circumstance or date and any decision to  take or refrain from taking any action or any selection, will be conclusive and binding  absent manifest error and may be made in its or their sole discretion and without consent  

 

  84134605.9   MRC Energy Company Credit Agreement 98  from any other party to this Agreement or any other Loan Document, except, in each case,  as expressly required pursuant to this Section 11.3.  (d) Unavailability of Tenor of Benchmark.  Notwithstanding anything to the  contrary herein or in any other Loan Document, at any time (including in connection with  the implementation of a Benchmark Replacement), (i) if the then-current Benchmark is a  term rate (including Term SOFR or USD LIBOR) and either (A) any tenor for such  Benchmark is not displayed on a screen or other information service that publishes such  rate from time to time as selected by Administrative Agent in its reasonable discretion or  (B) the regulatory supervisor for the administrator of such Benchmark has provided a  public statement or publication of information announcing that any tenor for such  Benchmark is or will be no longer representative, then Administrative Agent may modify  the definition of “Interest Period” or “Eurodollar-Interest Period” for any Benchmark  settings at or after such time to remove such unavailable or non-representative tenor and  (ii) if a tenor that was removed pursuant to clause (i) above either (A) is subsequently  displayed on a screen or information service for a Benchmark (including a Benchmark  Replacement) or (B) is not, or is no longer, subject to an announcement that it is or will no  longer be representative for a Benchmark (including a Benchmark Replacement), then  Administrative Agent may modify the definition of “Interest Period” or “Eurodollar- Interest Period” for all Benchmark settings at or after such time to reinstate such previously  removed tenor.  (e) Benchmark Unavailability Period.  Upon Borrower’s receipt of notice of the  commencement of a Benchmark Unavailability Period, Borrower may revoke any request  for a Eurodollar-based Advance of, conversion to or continuation of Eurodollar-based  Advances to be made, converted or continued during any Benchmark Unavailability Period  and, failing that, the Borrower will be deemed to have converted any such request into a  request for a Borrowing of or conversion to Base Rate Advances. During any Benchmark  Unavailability Period or at any time that a tenor for the then-current Benchmark is not an  Available Tenor, the component of Base Rate based upon the then-current Benchmark or  such tenor for such Benchmark, as applicable, will not be used in any determination of  Base Rate.  the Administrative Agent will promptly so notify the Borrower and each Lender.   Thereafter, the obligation of the Lenders to make or grant a continuation of Eurodollar- based Advances shall be suspended until the Administrative Agent notifies the Borrower  and the Lenders that the circumstances giving rise to such notice no longer exist.  Upon  receipt of such notice, the Borrower may revoke any pending request for a borrowing of,  conversion to or continuation of a Eurodollar-based Advance or, failing that, will be  deemed to have converted such request into a request for a Base Rate Advance in the  amount specified therein.  Notwithstanding the foregoing, if the Administrative Agent (i) determines that the  circumstances described in clause (a) of this Section 11.3 have arisen and such  circumstances are unlikely to be temporary, (ii) determines that the circumstances  described in clause (a) of this Section 11.3 have not arisen but the supervisor for the  administrator of the LIBOR Rate or a Governmental Authority having jurisdiction over the  

 

  84134605.9   MRC Energy Company Credit Agreement 99  Administrative Agent has made a public statement identifying a specific date after which  the LIBOR Rate shall no longer be used for determining interest rates for loans, or (iii) is  advised by the Majority Lenders of their determination in accordance with clause (b) of  this Section 11.3, then the Administrative Agent and the Borrower shall endeavor to  establish an alternate rate of interest to the LIBOR Rate that gives due consideration to the  then prevailing market convention for determining a rate of interest for syndicated loans in  the United States at such time, and shall enter into an amendment to this Agreement to  reflect such alternate rate of interest and such other related changes to this Agreement as  may be applicable, provided that to the extent that the Administrative Agent determines  that adoption of any portion of such market convention is not administratively feasible or  that no market convention for the administration of such alternate rate of interest exists,  the Administrative Agent shall administer such alternate rate of interest in a manner  determined by the Administrative Agent in consultation with the Borrower.  Notwithstanding anything to the contrary, such amendment shall become effective without  any further action or consent of any other party to this Agreement so long as the  Administrative Agent shall not have received, within five (5) Business Days of the date  notice of such alternate rate of interest is provided to the Lenders, a written notice from the  Majority Lenders stating that such Majority Lenders object to such amendment. If a notice  of an alternate rate of interest has been given and no such alternate rate of interest has been  determined, and (x) the circumstances under clause (i) or (iii) above exist or (y) the specific  date referred to in clause (ii) has occurred (as applicable), the Base Rate shall be calculated  without regard to clause (c) of the definition thereof. Provided that, if such alternate rate of  interest shall be less than zero, such rate shall be deemed to be zero for the purposes of this  Agreement.  11.4 Laws Affecting LIBOR Rate Availability.  If any Change in Law shall make it  unlawful or impossible for any of Lenders (or any of their respective Eurodollar Lending  Offices) to honor its obligations hereunder to make or maintain any Advance which bears interest  at or by reference to the LIBOR Rate, such Lender shall forthwith give notice thereof to Borrower  and to Administrative Agent.  Thereafter, (a) the obligations of the applicable Lenders to make  Advances which bear interest at or by reference to the LIBOR Rate and the right of Borrower to  convert an Advance into or continue or refund an Advance as an Advance which bears interest at  or by reference to the LIBOR Rate shall be suspended and thereafter only the Base Rate shall be  available, and (b) if any of Lenders may not lawfully continue to maintain an Advance which bears  interest at or by reference to the LIBOR Rate, the applicable Advance shall immediately be  converted to an Advance which bears interest at or by reference to the Base Rate.  11.5 Increased Cost of Advances Carried at the LIBOR Rate.  If any Change in Law  shall:  (a) subject any Recipient to any Taxes (other than (i) Indemnified Taxes, (ii)  Taxes described in clauses (b) through (d) of the definition of Excluded Taxes and (iii)  Connection Income Taxes) on its advances, loans, loan principal, letters of credit,  commitments, or other obligations, or its deposits, reserves, other liabilities or capital  attributable thereto; or  

 

  84134605.9   MRC Energy Company Credit Agreement 100  (b) impose, modify or deem applicable any reserve (including, without  limitation, any imposed by the Board of Governors of the Federal Reserve System), special  deposit or similar requirement against assets of, deposits with or for the account of, or  credit extended by, any of Lenders (or any of their respective Eurodollar Lending Offices)  (except any reserve requirement reflected in the Eurodollar-based rate) or shall impose on  any of Lenders (or any of their respective Eurodollar Lending Offices) or the foreign  exchange and interbank markets any other condition (other than Taxes) affecting any  Eurodollar-based Advance;  and the result of any of the foregoing matters is to increase the costs to any of Lenders by an  amount that any such Lender in its sole and absolute discretion deems material, of maintaining any  part of the Indebtedness hereunder as an Advance which bears interest at or by reference to the  LIBOR Rate or to reduce the amount of any sum received or receivable by any of Lenders under  this Agreement in respect of an Advance which bears interest at or by reference to the LIBOR  Rate, then such Lender shall promptly notify Administrative Agent, and Administrative Agent  shall promptly notify Borrower of such fact and demand compensation therefor and, within thirty  (30) Business Days after such notice, Borrower agrees to pay to such Lender or Lenders such  additional amount or amounts as will compensate such Lender or Lenders for such increased cost  or reduction, provided that each Lender agrees to take any reasonable action, to the extent such  action could be taken without cost or administrative or other burden or restriction to such Lender,  to mitigate or eliminate such cost or reduction, within a reasonable time after becoming aware of  the foregoing matters.  Administrative Agent will promptly notify Borrower of any event of which  it has knowledge which will entitle Lenders to compensation pursuant to this Section, or which  will cause Borrower to incur additional liability under Section 11.1, provided that Administrative  Agent shall incur no liability whatsoever to Lenders or Borrower in the event it fails to do so.  A  certificate of Administrative Agent (or such Lender, if applicable) setting forth the basis for  determining such additional amount or amounts necessary to compensate such Lender or Lenders  shall accompany such demand and shall be conclusively presumed to be correct absent manifest  error.  Notwithstanding anything to the contrary contained in this Section 11.5, Borrower shall not be  required to reimburse or pay any costs or expenses to any Lender as required by such sections  which have accrued more than 180 days prior to such Lender’s giving notice to Borrower that such  Lender has suffered or incurred such costs or expenses, and none of the Lenders shall be permitted  to pass through to Borrower costs and expenses under this Section 11.5 which are not also passed  through by such Lender to other customers of such Lender similarly situated when such customer  is subject to documents containing substantively similar provisions as those contained in such  Section.  11.6 Capital Adequacy and Other Increased Costs.  If, after the Effective Date, the  adoption or introduction of, or any change in any applicable law, treaty, rule or regulation (whether  domestic or foreign) now or hereafter in effect and whether or not presently applicable to any  Lender or Administrative Agent, or any interpretation or administration thereof by any  Governmental Authority charged with the interpretation or administration thereof, or compliance  by any Lender or Administrative Agent with any guideline, request or directive of any such  authority (whether or not having the force of law), including any risk based capital guidelines,  affects or would affect the amount of capital or liquidity required to be maintained by such Lender  

 

  84134605.9   MRC Energy Company Credit Agreement 101  or Administrative Agent (or any corporation controlling such Lender or Administrative Agent) and  such Lender or Administrative Agent, as the case may be, determines that the amount of such  capital or liquidity is increased by or based upon the existence of such Lender’s or Administrative  Agent’s obligations or Advances hereunder, the effect of such Change in Law to result in such an  increase, and such increase has the effect of reducing the rate of return on such Lender’s or  Administrative Agent’s (or such controlling corporation’s) capital as a consequence of such  obligations or Advances hereunder to a level below that which such Lender or Administrative  Agent (or such controlling corporation) could have achieved but for such circumstances (taking  into consideration its policies with respect to capital adequacy) by an amount deemed by such  Lender or Administrative Agent to be material (collectively, “Increased Costs”), then  Administrative Agent or such Lender shall notify Borrower, and thereafter Borrower shall pay to  such Lender or Administrative Agent, as the case may be, within ten (10) Business Days of written  demand therefor from such Lender or Administrative Agent, additional amounts sufficient to  compensate such Lender or Administrative Agent (or such controlling corporation) for any  increase in the amount of capital or liquidity and reduced rate of return which such Lender or  Administrative Agent reasonably determines to be allocable to the existence of such Lender’s or  Administrative Agent’s obligations or Advances hereunder.  A statement setting forth the amount  of such compensation, the methodology for the calculation and the calculation thereof which shall  also be prepared in good faith and in reasonable detail by such Lender or Administrative Agent,  as the case may be, shall be submitted by such Lender or by Administrative Agent to Borrower,  reasonably promptly after becoming aware of any event described in this Section 11.6 and shall  be conclusively presumed to be correct, absent manifest error.  Notwithstanding anything to the contrary contained in this Section 11.6, Borrower shall not be  required to reimburse or pay any costs or expenses to any Lender as required by this Section which  have accrued more than 180 days prior to such Lender’s giving notice to Borrower that such Lender  has suffered or incurred such costs or expenses, and none of the Lenders shall be permitted to pass  through to Borrower costs and expenses under this Section 11.6 which are not also passed through  by such Lender to other customers of such Lender similarly situated when such customer is subject  to documents containing substantively similar provisions as those contained in this Section.  11.7 Right of Lenders to Fund through Branches and Affiliates.  Each Lender may, if it  so elects, fulfill its commitment as to any Advance hereunder by designating a branch or Affiliate  of such Lender to make such Advance; provided that (a) such Lender shall remain solely  responsible for the performances of its obligations hereunder and (b) no such designation shall  result in any material increased costs to Borrower.  11.8 Margin Adjustment.  Adjustments to the Applicable Margins and the Applicable  Fee Percentages set forth on Schedule 1.1 shall be calculated by Administrative Agent and based  on the Borrowing Base Utilization in effect from time to time.  Each change in the Applicable  Margins and the Applicable Fee Percentages (based on the Borrowing Base Utilization) shall apply  during the period commencing on the effective date of such change and ending on the date  immediately preceding the effective date of the next change; provided, however, that if at any time  Borrower fails to deliver a Reserve Report within five (5) days of the date required to be delivered  pursuant to Section 7.15, and for each day during the period from and including such date to but  excluding the date on which such Reserve Report is delivered, the Applicable Margins and  Applicable Fee Percentages shall be at the highest level on the Applicable Margin Grid.  

 

  84134605.9   MRC Energy Company Credit Agreement 102  11.9 Taxes.  (a) Defined Terms.  For purposes of this Section 11.9, the term “Lender”  includes any Issuing Lender and the term “applicable law” includes FATCA.  (b) Payments Free of Taxes.  Any and all payments by or on account of any  obligation of any Credit Party under any Loan Document shall be made without deduction  or withholding for any Taxes, except as required by applicable law.  If any applicable law  (as determined in the good faith discretion of an applicable Withholding Agent) requires  the deduction or withholding of any Tax from any such payment by a Withholding Agent,  then the applicable Withholding Agent shall be entitled to make such deduction or  withholding and shall timely pay the full amount deducted or withheld to the relevant  Governmental Authority in accordance with applicable law and, if such Tax is an  Indemnified Tax, then the sum payable by the applicable Loan Party shall be increased as  necessary so that after such deduction or withholding has been made (including such  deductions and withholdings applicable to additional sums payable under this paragraph  (a)) the applicable Recipient receives an amount equal to the sum it would have received  had no such deduction or withholding been made.  (c) Payment of Other Taxes by Borrower.  The Credit Parties shall timely pay  to the relevant Governmental Authority in accordance with applicable law, or at the option  of the Administrative Agent timely reimburse it for the payment of, any Other Taxes.  (d) Indemnification by Borrower.  The Credit Parties shall jointly and severally  indemnify each Recipient, within 10 days after demand therefor, for the full amount of any  Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to  amounts payable under this paragraph (d) payable or paid by such Recipient or required to  be withheld or deducted from a payment to such Recipient and any reasonable expenses  arising therefrom or with respect thereto, whether or not such Indemnified Taxes were  correctly or legally imposed or asserted by the relevant Governmental Authority.  A  certificate as to the amount of such payment or liability delivered to Borrower by a Lender  (with a copy to the Administrative Agent), or by the Administrative Agent on its own behalf  or on behalf of a Lender, shall be conclusive absent manifest error.  (e) Indemnification by the Lenders.  Each Lender shall severally indemnify the  Administrative Agent, within 10 days after demand therefor, for (i) any Indemnified Taxes  attributable to such Lender (but only to the extent that any Credit Party has not already  indemnified the Administrative Agent for such Indemnified Taxes and without limiting the  obligation of the Credit Parties to do so), (ii) any Taxes attributable to such Lender’s failure  to comply with the provisions of Section 13.7(d) relating to the maintenance of a  Participant Register and (iii) any Excluded Taxes attributable to such Lender, in each case,  that are payable or paid by the Administrative Agent in connection with any Loan  Document, and any reasonable expenses arising therefrom or with respect thereto, whether  or not such 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 any Lender by the Administrative Agent shall be conclusive absent manifest  error.  Each Lender hereby authorizes the Administrative Agent to set off and apply any  

 

  84134605.9   MRC Energy Company Credit Agreement 103  and all amounts at any time owing to such Lender under any Loan Document or otherwise  payable by the Administrative Agent to the Lender from any other source against any  amount due to the Administrative Agent under this paragraph (e).  (f) Evidence of Payments.  As soon as practicable after any payment of Taxes  by any Credit Party to a Governmental Authority pursuant to this Section 11.9, such Credit  Party shall deliver to the Administrative Agent the original or a certified copy of a receipt  issued by such Governmental Authority evidencing such payment, a copy of the return  reporting such payment or other evidence of such payment reasonably satisfactory to the  Administrative Agent.  (g) Status of Lenders.  Any Lender that is entitled to an exemption from or  reduction of withholding Tax with respect to payments made under any Loan Document  shall deliver to Borrower and the Administrative Agent, at the time or times reasonably  requested by Borrower or the Administrative Agent, such properly completed and executed  documentation reasonably requested by Borrower or the Administrative Agent as will  permit such payments to be made without withholding or at a reduced rate of withholding.   In addition, any Lender, if reasonably requested by Borrower or the Administrative Agent,  shall deliver such other documentation prescribed by applicable law or reasonably  requested by Borrower or the Administrative Agent as will enable Borrower or the  Administrative Agent to determine whether or not such Lender is subject to backup  withholding or information reporting requirements.  Notwithstanding anything to the  contrary in the preceding two sentences, the completion, execution and submission of such  documentation (other than such documentation set forth in clause (i), (ii) and (iv) below)  shall not be required if in the Lender’s reasonable judgment such completion, execution or  submission would subject such Lender to any material unreimbursed cost or expense or  would materially prejudice the legal or commercial position of such Lender.  Without limiting the generality of the foregoing:  (i) any Lender that is a U.S. Person shall deliver to Borrower and the  Administrative Agent on or prior to the date on which such Lender becomes a  Lender under this Agreement (and from time to time thereafter upon the reasonable  request of Borrower or the Administrative Agent), executed originals of IRS Form  W-9 certifying that such Lender is exempt from U.S. federal backup withholding  tax;  (ii) any Foreign Lender shall, to the extent it is legally entitled to do so,  deliver to Borrower and the Administrative Agent (in such number of copies as  shall be requested by the recipient) on or prior to the date on which such Foreign  Lender becomes a Lender under this Agreement (and from time to time thereafter  upon the reasonable request of Borrower or the Administrative Agent), whichever  of the following is applicable:  (A) in the case of a Foreign Lender claiming the benefits of an  income tax treaty to which the United States is a party (2) with respect to  payments of interest under any Loan Document, executed originals of IRS  

 

  84134605.9   MRC Energy Company Credit Agreement 104  Form W-8BEN establishing an exemption from, or reduction of, U.S.  federal withholding Tax pursuant to the “interest” article of such tax treaty  and (2) with respect to any other applicable payments under any Loan  Document, IRS Form W-8BEN establishing an exemption from, or  reduction of, U.S. federal withholding Tax pursuant to the “business  profits” or “other income” article of such tax treaty;  (B) executed originals of IRS 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 Internal  Revenue Code, (1) a certificate substantially in the form of Exhibit H-1 to  the effect that such Foreign Lender is not a “bank” within the meaning of  Section 881(c)(3)(A) of the Internal Revenue Code, a “10 percent  shareholder” of Borrower within the meaning of Section 881(c)(3)(B) of the  Internal Revenue Code, or a “controlled foreign corporation” described in  Section 881(c)(3)(C) of the Internal Revenue Code (a “U.S. Tax  Compliance Certificate”) and (2) executed originals of IRS Form W-8BEN;  or  (D) to the extent a Foreign Lender is not the beneficial owner,  executed originals of IRS Form W-8IMY, accompanied by IRS Form W- 8ECI, IRS Form W-8BEN, a U.S. Tax Compliance Certificate substantially  in the form of Exhibit H-2 or Exhibit H-3, IRS Form W-9, and/or other  certification documents from each beneficial owner, as applicable; provided  that if the Foreign Lender is a partnership and one or more direct or indirect  partners of such Foreign Lender are claiming the portfolio interest  exemption, such Foreign Lender may provide a U.S. Tax Compliance  Certificate substantially in the form of Exhibit H-4 on behalf of each such  direct and indirect partner;  (iii) any Foreign Lender shall, to the extent it is legally entitled to do so,  deliver to Borrower and the Administrative Agent (in such number of copies as  shall be requested by the recipient) on or prior to the date on which such Foreign  Lender becomes a Lender under this Agreement (and from time to time thereafter  upon the reasonable request of Borrower or the Administrative Agent), executed  originals of any other form prescribed by applicable law as a basis for claiming  exemption from or a reduction in U.S. federal withholding Tax, duly completed,  together with such supplementary documentation as may be prescribed by  applicable law to permit Borrower or the Administrative Agent to determine the  withholding or deduction required to be made; and  (iv) if a payment made to a Lender under any Loan Document would be  subject to U.S. federal withholding Tax imposed by FATCA if such Lender were  to fail to comply with the applicable reporting requirements of FATCA (including  those contained in Section 1471(b) or 1472(b) of the Internal Revenue Code, as  applicable), such Lender shall deliver to Borrower and the Administrative Agent at  

 

  84134605.9   MRC Energy Company Credit Agreement 105  the time or times prescribed by law and at such time or times reasonably requested  by Borrower or the Administrative Agent such documentation prescribed by  applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Internal  Revenue Code) and such additional documentation reasonably requested by  Borrower or the Administrative Agent as may be necessary for Borrower and the  Administrative Agent to comply with their obligations under FATCA and to  determine that such Lender has complied with such Lender’s obligations under  FATCA or to determine the amount to deduct and withhold from such payment.   Solely for purposes of this clause (iv), “FATCA” shall include any amendments  made to FATCA after the date of this Agreement.  Each Lender agrees that if any form or certification it previously delivered expires  or becomes obsolete or inaccurate in any respect, it shall update such form or certification  or promptly notify Borrower and the Administrative Agent in writing of its legal inability  to do so.  (h) Treatment of Certain Refunds.  If any party determines, in its sole discretion  exercised in good faith, that it has received a refund of any Taxes as to which it has been  indemnified pursuant to this Section 11.9 (including by the payment of additional amounts  pursuant to this Section 11.9), it shall pay to the indemnifying party an amount equal to  such refund (but only to the extent of indemnity payments made under this Section 11.9  with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses  (including Taxes) of such indemnified party and without interest (other than any interest  paid by the relevant Governmental Authority with respect to such refund).  Such  indemnifying party, upon the request of such indemnified party, shall repay to such  indemnified party the amount paid over pursuant to this paragraph (h) (plus any penalties,  interest or other charges imposed by the relevant Governmental Authority) in the event that  such indemnified party is required to repay such refund to such Governmental Authority.   Notwithstanding anything to the contrary in this paragraph (h), in no event will the  indemnified party be required to pay any amount to an indemnifying party pursuant to this  paragraph (h) the payment of which would place the indemnified party in a less favorable  net after-Tax position than the indemnified party would have been in if the Tax subject to  indemnification and giving rise to such refund had not been deducted, withheld or  otherwise imposed and the indemnification payments or additional amounts with respect  to such Tax had never been paid.  This paragraph shall not be construed to require any  indemnified party to make available its Tax returns (or any other information relating to its  Taxes that it deems confidential) to the indemnifying party or any other Person.  (i) Survival.  Each party’s obligations under this Section 11.9 shall survive the  resignation or replacement of the Administrative Agent or any assignment of rights by, or  the replacement of, a Lender, the termination of the Commitments and the repayment,  satisfaction or discharge of all obligations under any Loan Document.  ARTICLE 12. AGENT.  12.1 Appointment of Administrative Agent.  Each Lender and the holder of each Note  (if issued) irrevocably appoints and authorizes Administrative Agent to act on behalf of such  

 

  84134605.9   MRC Energy Company Credit Agreement 106  Lender or holder under this Agreement and the other Loan Documents and to exercise such powers  hereunder and thereunder as are specifically delegated to Administrative Agent by the terms hereof  and thereof, together with such powers as may be reasonably incidental thereto, including without  limitation the power to execute or authorize the execution of financing or similar statements or  notices, and other documents.  In performing its functions and duties under this Agreement,  Administrative Agent shall act solely as agent of Lenders and does not assume and shall not be  deemed to have assumed any obligation towards or relationship of agency or trust with or for any  Credit Party.  12.2 Deposit Account with Administrative Agent or any Lender.  Unless such  authorization is revoked by written notice to Administrative Agent, Borrower authorizes  Administrative Agent, in Administrative Agent’s sole discretion, upon notice to Borrower to  charge its general deposit account(s), if any, maintained with Administrative Agent for the amount  of any principal, interest, or other amounts or costs due under this Agreement when the same  become due and payable under the terms of this Agreement or the Notes.  12.3 Scope of Administrative Agent’s Duties.  Administrative Agent shall have no duties  or responsibilities except those expressly set forth herein, and shall not, by reason of this  Agreement or otherwise, have a fiduciary relationship with any Lender (and no implied covenants  or other obligations shall be read into this Agreement against Administrative Agent).  None of  Administrative Agent, its Affiliates nor any of their respective directors, officers, employees or  agents shall be liable to any Lender for any action taken or omitted to be taken by it or them under  this Agreement or any document executed pursuant hereto, or in connection herewith or therewith  with the consent or at the request of the Majority Lenders or the Supermajority Lenders (or all of  Lenders for those acts requiring consent of all of Lenders) (except for its or their own willful  misconduct or gross negligence), nor be responsible for or have any duties to ascertain, inquire  into or verify (a) any recitals or warranties made by the Credit Parties or any Affiliate of the Credit  Parties, or any officer thereof contained herein or therein, (b) the effectiveness, enforceability,  validity or due execution of this Agreement or any document executed pursuant hereto or any  security thereunder, (c) the performance by the Credit Parties of their respective obligations  hereunder or thereunder, or (d) the satisfaction of any condition hereunder or thereunder, including  without limitation in connection with the making of any Advance or the issuance of any Letter of  Credit.  Administrative Agent and its Affiliates shall be entitled to rely upon any certificate, notice,  document or other communication (including any cable, telegraph, telex, facsimile transmission  or oral communication) believed by it to be genuine and correct and to have been sent or given by  or on behalf of a proper person.  Administrative Agent may treat the payee of any Note as the  holder thereof.  Administrative Agent may employ agents and may consult with legal counsel,  independent public accountants and other experts selected by it and shall not be liable to Lenders  (except as to money or property received by them or their authorized agents), for the negligence  or misconduct of any such agent selected by it with reasonable care or for any action taken or  omitted to be taken by it in good faith in accordance with the advice of such counsel, accountants  or experts.  12.4 Successor Administrative Agent.  Administrative Agent may resign as such at any  time upon at least thirty (30) days prior notice to Borrower and each of Lenders.  If Administrative  Agent at any time shall resign or if the office of Administrative Agent shall become vacant for any  other reason, Majority Lenders shall, by written instrument, appoint successor  

 

  84134605.9   MRC Energy Company Credit Agreement 107  agent(s) (“Successor Administrative Agent”) satisfactory to such Majority Lenders and, so long as  no Default or Event of Default has occurred and is continuing, to Borrower (which approval shall  not be unreasonably withheld or delayed); provided, however that any such Successor  Administrative Agent shall be a bank or a trust company or other financial institution which  maintains an office in the United States, or a commercial bank organized under the laws of the  United States or any state thereof, or any Affiliate of such bank or trust company or other financial  institution which is engaged in the banking business, and shall have a combined capital and surplus  of at least $500,000,000.  Such Successor Administrative Agent shall thereupon become  Administrative Agent hereunder, as applicable, and Administrative Agent shall deliver or cause to  be delivered to any successor agent such documents of transfer and assignment as such Successor  Administrative Agent may reasonably request.  If a Successor Administrative Agent is not so  appointed or does not accept such appointment before the resigning Administrative Agent’s  resignation becomes effective, the resigning Administrative Agent may appoint a temporary  successor to act until such appointment by the Majority Lenders and, if applicable, Borrower, is  made and accepted, or if no such temporary successor is appointed as provided above by the  resigning Administrative Agent, the Majority Lenders shall thereafter perform all of the duties of  the resigning Administrative Agent hereunder until such appointment by the Majority Lenders and,  if applicable, Borrower, is made and accepted.  Such Successor Administrative Agent shall  succeed to all of the rights and obligations of the resigning Administrative Agent as if originally  named.  The resigning Administrative Agent shall duly assign, transfer and deliver to such  Successor Administrative Agent all moneys at the time held by the resigning Administrative Agent  hereunder after deducting therefrom its expenses for which it is entitled to be reimbursed  hereunder.  Upon such succession of any such Successor Administrative Agent, the resigning  Administrative Agent shall be discharged from its duties and obligations, in its capacity as  Administrative Agent hereunder, except for its gross negligence or willful misconduct arising prior  to its resignation hereunder, and the provisions of this Article 12 shall continue in effect for the  benefit of the resigning Administrative Agent in respect of any actions taken or omitted to be taken  by it while it was acting as Administrative Agent.  12.5 Credit Decisions.  Each Lender acknowledges that it has, independently of  Administrative Agent and each other Lender and based on the financial statements of Borrower  and such other documents, information and investigations as it has deemed appropriate, made its  own credit decision to extend credit hereunder from time to time.  Each Lender also acknowledges  that it will, independently of Administrative Agent and each other Lender and based on such other  documents, information and investigations as it shall deem appropriate at any time, continue to  make its own credit decisions as to exercising or not exercising from time to time any rights and  privileges available to it under this Agreement, any Loan Document or any other document  executed pursuant hereto.  12.6 Authority of Administrative Agent to Enforce This Agreement.  Each Lender,  subject to the terms and conditions of this Agreement, grants Administrative Agent full power and  authority as attorney-in-fact to institute and maintain actions, suits or proceedings for the collection  and enforcement of any Indebtedness outstanding under this Agreement or any other Loan  Document and to file such proofs of debt or other documents as may be necessary to have the  claims of Lenders allowed in any proceeding relative to any Credit Party, or their respective  creditors or affecting their respective properties, and to take such other actions which  

 

  84134605.9   MRC Energy Company Credit Agreement 108  Administrative Agent considers to be necessary or desirable for the protection, collection and  enforcement of the Notes, this Agreement or the other Loan Documents.  12.7 Indemnification of Administrative Agent.  Lenders agree (which agreement shall  survive the expiration or termination of this Agreement) to indemnify Administrative Agent and  its Affiliates (to the extent not reimbursed by Borrower, but without limiting any obligation of  Borrower to make such reimbursement), ratably according to their respective Revolving Credit  Percentages, from and against any and all claims, damages, losses, liabilities, costs or expenses of  any kind or nature whatsoever (including, without limitation, reasonable fees and expenses of  house and outside counsel) which may be imposed on, incurred by, or asserted against  Administrative Agent and its Affiliates in any way relating to or arising out of this Agreement, any  of the other Loan Documents or the transactions contemplated hereby or any action taken or  omitted by Administrative Agent and its Affiliates under this Agreement or any of the Loan  Documents; provided, however, that no Lender shall be liable for any portion of such claims,  damages, losses, liabilities, costs or expenses resulting from Administrative Agent’s or its  Affiliate’s gross negligence or willful misconduct.  Without limitation of the foregoing, each  Lender agrees to reimburse Administrative Agent and its Affiliates promptly upon demand for its  ratable share of any reasonable out-of-pocket expenses (including, without limitation, reasonable  fees and expenses of in-house and outside counsel) incurred by Administrative Agent and its  Affiliates in connection with the preparation, execution, delivery, administration, modification,  amendment or enforcement (whether through negotiations, legal proceedings or otherwise) of, or  legal advice in respect of rights or responsibilities under, this Agreement or any of the other Loan  Documents, to the extent that Administrative Agent and its Affiliates are not reimbursed for such  expenses by Borrower, but without limiting the obligation of Borrower to make such  reimbursement.  Each Lender agrees to reimburse Administrative Agent and its Affiliates promptly  upon demand for its ratable share of any amounts owing to Administrative Agent and its Affiliates  by Lenders pursuant to this Section, provided that, if Administrative Agent or its Affiliates are  subsequently reimbursed by Borrower for such amounts, they shall refund to Lenders on a pro rata  basis the amount of any excess reimbursement.  If the indemnity furnished to Administrative Agent  and its Affiliates under this Section shall become impaired as determined in Administrative  Agent’s reasonable judgment or Administrative Agent shall elect in its sole discretion to have such  indemnity confirmed by Lenders (as to specific matters or otherwise), Administrative Agent shall  give notice thereof to each Lender and, until such additional indemnity is provided or such existing  indemnity is confirmed, Administrative Agent may cease, or not commence, to take any action.  12.8 Knowledge of Default.  It is expressly understood and agreed that Administrative  Agent shall be entitled to assume that no Default or Event of Default has occurred and is  continuing, unless the officers of Administrative Agent immediately responsible for matters  concerning this Agreement shall have received a written notice from a Lender or a Borrower  specifying such Default or Event of Default and stating that such notice is a “notice of default”.   Upon receiving such a notice, Administrative Agent shall promptly notify each Lender of such  Default or Event of Default and provide each Lender with a copy of such notice and shall endeavor  to provide such notice to Lenders within three (3) Business Days (but without any liability  whatsoever in the event of its failure to do so).  Administrative Agent shall also furnish Lenders,  promptly upon receipt, with copies of all other notices or other information required to be provided  by Borrower hereunder.  

 

  84134605.9   MRC Energy Company Credit Agreement 109  12.9 Administrative Agent’s Authorization; Action by Lenders.  Except as otherwise  expressly provided herein, whenever Administrative Agent is authorized and empowered  hereunder on behalf of Lenders to give any approval or consent, or to make any request, or to take  any other action on behalf of Lenders (including without limitation the exercise of any right or  remedy hereunder or under the other Loan Documents), Administrative Agent shall be required to  give such approval or consent, or to make such request or to take such other action only when so  requested in writing by the Majority Lenders, the Supermajority Lenders or Lenders, as applicable  hereunder.  Action that may be taken by the Majority Lenders, the Supermajority Lenders, any  other specified Revolving Credit Percentage of Lenders or all of Lenders, as the case may be (as  provided for hereunder) may be taken (i) pursuant to a vote of the requisite percentages of Lenders  as required hereunder at a meeting (which may be held by telephone conference call), provided  that Administrative Agent exercises good faith, diligent efforts to give all of Lenders reasonable  advance notice of the meeting, or (ii) pursuant to the written consent of the requisite percentages  of Lenders as required hereunder, provided that all of Lenders are given reasonable advance notice  of the requests for such consent.  12.10 Enforcement Actions by Administrative Agent.  Except as otherwise expressly  provided under this Agreement or in any of the other Loan Documents and subject to the terms  hereof, Administrative Agent will take such action, assert such rights and pursue such remedies  under this Agreement and the other Loan Documents as the Majority Lenders, the Supermajority  Lenders, or all of Lenders, as the case may be (as provided for hereunder), shall direct; provided,  however, that Administrative Agent shall not be required to act or omit to act if, in the reasonable  judgment of Administrative Agent, such action or omission may expose Administrative Agent to  personal liability for which Administrative Agent has not been satisfactorily indemnified  hereunder or is contrary to this Agreement, any of the Loan Documents or applicable law.  Except  as expressly provided above or elsewhere in this Agreement or the other Loan Documents, no  Lender (other than Administrative Agent, acting in its capacity as agent) shall be entitled to take  any enforcement action of any kind under this Agreement or any of the other Loan Documents.  12.11 Collateral Matters.  Administrative Agent is authorized on behalf of all Lenders,  without the necessity of any notice to or further consent from Lenders, from time to time to take  any action with respect to any Collateral or the Collateral Documents which may be necessary to  perfect and maintain a perfected security interest in and Liens upon the Collateral granted pursuant  to the Loan Documents.  12.12 Administrative Agent in its Individual Capacity.  RBC and its Affiliates, successors  and assigns shall each have the same rights and powers hereunder as any other Lender and may  exercise or refrain from exercising the same as though such Lender were not Administrative Agent.   RBC and its Affiliates may (without having to account therefor to any Lender) accept deposits  from, lend money to, and generally engage in any kind of banking, trust, financial advisory or  other business with the Credit Parties as if such Lender were not acting as Administrative Agent  hereunder, and may accept fees and other consideration therefor without having to account for the  same to Lenders.  12.13 Administrative Agent’s Fees.  Borrower shall pay to the Administrative Agent the  administrative agency fee set forth in the Fee Letter until the Indebtedness has been repaid and  

 

  84134605.9   MRC Energy Company Credit Agreement 110  discharged in full and no commitment to extend any credit hereunder is outstanding.  The agency  fees referred to in this Section 12.13 shall not be refundable under any circumstances.  12.14 Documentation Administrative Agent or other Titles.  Any Lender identified on the  facing page or signature page of this Agreement or in any amendment hereto or as designated with  consent of Administrative Agent in any assignment agreement as Lead Arranger, Documentation  Agent, Syndication Agent or any similar titles, shall not have any right, power, obligation, liability,  responsibility or duty under this Agreement as a result of such title other than those applicable to  all Lenders as such.  Without limiting the foregoing, Lenders so identified shall not have or be  deemed to have any fiduciary relationship with any Lender as a result of such title.  Each Lender  acknowledges that it has not relied, and will not rely, on Lender so identified in deciding to enter  into this Agreement or in taking or not taking action hereunder.  12.15 No Reliance on Administrative Agent’s Customer Identification Program.  (a) Each Lender acknowledges and agrees that neither such Lender, nor any of  its Affiliates, participants or assignees, may rely on Administrative Agent to carry out such  Lender’s, Affiliate’s, participant’s or assignee’s customer identification program, or other  obligations required or imposed under or pursuant to the USA Patriot Act or the regulations  thereunder, including the regulations contained in 31 CFR 103.121 (as hereafter amended  or replaced, the “CIP Regulations”), or any other anti-terrorism law, including any  programs involving any of the following items relating to or in connection with Borrower  or any of its Subsidiaries, any of their respective Affiliates or agents, the Loan Documents  or the transactions hereunder:  (i) any identity verification procedures, (ii) any record  keeping, (iii) any comparisons with government lists, (iv) any customer notices or (v) any  other procedures required under the CIP Regulations or such other laws.  (b) Each Lender or assignee or participant of a Lender that is not organized  under the laws of the United States or a state thereof (and is not excepted from the  certification requirement contained in Section 313 of the USA Patriot Act and the  applicable regulations because it is both (i) an affiliate of a depository institution or foreign  bank that maintains a physical presence in the United States or foreign country, and  (ii) subject to supervision by a banking authority regulating such affiliated depository  institution or foreign bank) shall deliver to Administrative Agent the certification, or, if  applicable, recertification, certifying that such Lender is not a “shell” and certifying to  other matters as required by Section 313 of the USA Patriot Act and the applicable  regulations:  (x) within 10 days after the Effective Date, and (y) at such other times as are  required under the USA Patriot Act.  12.16 Certain Payments  (a) Each Lender hereby agrees that if, at any time, (i) it receives any amount  from Administrative Agent on account of the Indebtedness, whether for principal, interest,  fees or otherwise (the “Applicable Payment”), and whether or not such amount or any other  amount is then due and owing to such Lender by Borrower or any Credit Party, and (ii)  Administrative Agent subsequently notifies such Lender that the Applicable Payment was  either (A) made in error or (B) has not been reimbursed by Borrower, in whole or in part,  

 

  84134605.9   MRC Energy Company Credit Agreement 111  to Administrative Agent within the time specified thereof under this Agreement, then:  (x)  such Lender shall promptly return such amount (or, if applicable, its ratable share of the  unreimbursed portion thereof) to Administrative Agent within one (1) Business Day  following notice thereof and (y) any amounts not so returned shall bear interest at the  Federal Funds Effective Rate.  Administrative Agent shall not be liable for any  apportionment or distribution of payments made by it in good faith and if any such  apportionment or distribution is subsequently determined to have been made in error the  sole recourse of any Lender or other Person shall be to recover the amount from the Person  that actually received it.  (b) Borrower and each other Credit Party hereby agrees that (x) in the event an  Applicable Payment (or portion thereof) is not recovered from any Lender, including,  without limitation, any Issuing Lender, that has received such Applicable Payment (or any  portion thereof) for any reason, Administrative Agent shall be subrogated to all the rights  of such Lender with respect to such amount and (y) an Applicable Payment shall not pay,  prepay, repay, discharge or otherwise satisfy any Indebtedness owed by Borrower or any  other Credit Party except, in each case, to the extent such Applicable Payment is, and solely  with respect to the amount of such Applicable Payment that is, comprised of funds received  by Administrative Agent from Borrower or any other Credit Party for the purpose of  making such Applicable Payment.  (c) This Section 12.16 shall survive the resignation or replacement of  Administrative Agent hereunder and/or any termination of the Commitments or repayment,  satisfaction or discharge of the Indebtednesss (or any portion thereof) under any Loan  Document.  ARTICLE 13. MISCELLANEOUS.  13.1 Accounting Principles.  Except as otherwise expressly provided herein, all terms of  an accounting or financial nature shall be construed in accordance with GAAP, as in effect from  time to time; provided that, if after the date hereof there occurs any change in GAAP or in the  application thereof on the operation of any provision hereof and Borrower notifies Administrative  Agent that Borrower requests an amendment to any provision hereof to eliminate the effect of such  change  in GAAP or in the application thereof (or if Administrative Agent notifies Borrower that  Majority Lenders request an amendment to any provision hereof for such purpose), regardless of  whether any such notice is given before or after such change in GAAP or in the application thereof,  then such provision shall be interpreted on the basis of GAAP as in effect and applied immediately  before such change shall have become effective until such notice shall have been withdrawn or  such provision amended in accordance herewith.  Notwithstanding anything in this Agreement or  any other Loan Document to the contrary, for the purposes of calculating compliance with any  covenant in this Agreement or any other Loan Document, no effect shall be given to any change  in GAAP arising out of a change described in the Proposed Accounting Standards Update to Leases  (Topic 840) dated August 17, 2010 or a substantially similar pronouncement.  13.2 Consent to Jurisdiction.  Borrower, Administrative Agent and Lenders hereby  irrevocably submit to the non-exclusive jurisdiction of any United States Federal Court or Texas  state court sitting in Dallas, Texas in any action or proceeding arising out of or relating to this  

 

  84134605.9   MRC Energy Company Credit Agreement 112  Agreement or any of the Loan Documents and the parties hereto irrevocably agree that all claims  in respect of such action or proceeding may be heard and determined in any such United States  Federal Court or Texas state court.  Each of the parties irrevocably consents to the service of any  and all process in any such action or proceeding brought in any court in or of the State of Texas  by the delivery of copies of such process to it at the applicable addresses specified on the signature  page hereto or by certified mail directed to such address or such other address as may be designated  by it in a notice to the other parties that complies as to delivery with the terms of Section 13.6.   Nothing in this Section shall affect the right of any party to serve process in any other manner  permitted by law or limit the right of Lenders or Administrative Agent (or any of them) to bring  any such action or proceeding against any party hereto, or any of their property in the courts with  subject matter jurisdiction of any other jurisdiction.  Each of the parties irrevocably waives any  objection to the laying of venue of any such suit or proceeding in the above described courts.  13.3 Law of Texas.  This Agreement, the Notes and, except where otherwise expressly  specified therein to be governed by local law, the other Loan Documents shall be governed by and  construed and enforced in accordance with the laws of the State of Texas (without regard to its  conflict of laws provisions).  Whenever possible each provision of this Agreement shall be  interpreted in such manner as to be effective and valid under applicable law, but if any provision  of this Agreement shall be prohibited by or invalid under applicable law, such provision shall be  ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of  such provision or the remaining provisions of this Agreement.  13.4 Interest.  It is the intent of Borrower and each Lender in the execution and  performance of this Agreement and the other Loan 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, if any, and the United States of  America from time to time in effect.  In furtherance thereof, Lenders and Borrower stipulate and  agree that none of the terms and provisions contained in this Agreement or the other Loan  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 nonusurious interest  rate under applicable law (the “Maximum Rate”) and that for purposes of this Agreement  “interest” shall include the aggregate of all charges which constitute interest under such laws that  are contracted for, charged or received under this Agreement; and in the event that,  notwithstanding the foregoing, under any circumstances the aggregate amounts taken, reserved,  charged, received or paid on the Advances, 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 outstanding principal of the  Indebtedness (other than Lender Hedging Obligations and Lender Product Obligations) owing to  such Lender (or if such Indebtedness shall have been paid in full, refund said excess to Borrower).   In the event that the maturity of the Indebtedness (other than Lender Hedging Obligations and  Lender Product Obligations) is 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 such Indebtedness (or, if such Indebtedness shall have been paid in full,  refunded to Borrower of such interest).  In determining whether or not the interest paid or payable  

 

  84134605.9   MRC Energy Company Credit Agreement 113  under any specific contingencies exceeds the Maximum Rate, Borrower and 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 Indebtedness all amounts considered to be  interest under applicable law at any time contracted for, charged, received or reserved in  connection with the Indebtedness.  The provisions of this Section shall control over all other  provisions of this Agreement or the other Loan Documents which may be in apparent conflict  herewith.  For purposes of determining the Maximum Rate under the law of the State of Texas,  the applicable interest rate ceiling shall be the “weekly ceiling” from time to time in effect under  Chapter 303 of the Texas Finance Code, as amended.  13.5 Closing Costs and Other Costs; Indemnification.  (a) Borrower shall pay or reimburse (i) Administrative Agent and its Affiliates  for payment of, on demand, all reasonable and documented out-of-pocket costs and  expenses, including, by way of description and not limitation, reasonable outside attorney  fees and advisor fees and advances, appraisal and accounting fees, lien search fees, and  required travel costs, incurred by Administrative Agent and its Affiliates in connection  with the commitment, syndication, negotiation, consummation, closing and funding of the  loans contemplated hereby, or in connection with the preparation, administration or  enforcement of this Agreement or the other Loan Documents (including the obtaining of  legal advice regarding the rights and responsibilities of the parties hereto) or any  refinancing or restructuring of the loans or Advances provided under this Agreement or the  other Loan Documents, or any amendment, revision, modification, consent or waiver  thereof requested by Borrower, and (ii) Administrative Agent and its Affiliates and each of  Lenders, as the case may be, for all stamp and other taxes and duties payable or determined  to be payable in connection with the execution, delivery, filing or recording of this  Agreement and the other Loan Documents and the consummation of the transactions  contemplated hereby (other than Excluded Taxes), and any and all liabilities with respect  to or resulting from any delay in paying or omitting to pay such taxes or duties.   Furthermore, Borrower shall pay or reimburse all reasonable and documented out-of  pocket costs and expenses, including without limitation reasonable attorney fees and  advisor fees, incurred by Administrative Agent and its Affiliates and, after the occurrence  and during the continuance of an Event of Default, by Lenders in revising, preserving,  protecting, exercising or enforcing any of its or any of Lenders’ rights against Borrower or  any other Credit Party, or otherwise incurred by Administrative Agent and its Affiliates  and Lenders in connection with any Event of Default or the enforcement of the Advances  (whether incurred through negotiations, legal proceedings or otherwise), including by way  of description and not limitation, such charges in any court or bankruptcy proceedings or  arising out of any claim or action by any person against Administrative Agent, its  Affiliates, or any Lender which would not have been asserted were it not for Administrative  Agent’s or such Affiliate’s or Lender’s relationship with Borrower hereunder or otherwise,  shall also be paid by Borrower.  Borrower shall pay any amounts due under this  Section 13.5 within thirty (30) days of the receipt by Borrower of notice of the amount due.  (b) BORROWER AGREES TO INDEMNIFY AND HOLD  ADMINISTRATIVE AGENT, ISSUING LENDER AND EACH LENDER AND EACH  RELATED PARTY OF ANY OF THE FOREGOING PERSONS (EACH, AN  

 

  84134605.9   MRC Energy Company Credit Agreement 114  “INDEMNIFIED PERSON”) HARMLESS FROM ALL LOSS, COST, DAMAGE,  LIABILITY OR EXPENSES, INCLUDING REASONABLE DOCUMENTED  OUTSIDE ATTORNEYS’ FEES AND DISBURSEMENTS (BUT WITHOUT  DUPLICATION OF SUCH FEES AND DISBURSEMENTS FOR THE SAME  SERVICES), INCURRED BY ANY INDEMNIFIED PERSON BY REASON OF AN  EVENT OF DEFAULT, OR ENFORCING THE OBLIGATIONS OF ANY CREDIT  PARTY UNDER THIS AGREEMENT OR ANY OF THE OTHER LOAN  DOCUMENTS, AS APPLICABLE, OR IN THE PROSECUTION OR DEFENSE OF  ANY ACTION OR PROCEEDING CONCERNING ANY MATTER GROWING OUT  OF OR CONNECTED WITH THIS AGREEMENT OR ANY OF THE LOAN  DOCUMENTS, EXCLUDING, HOWEVER, ANY LOSS, COST, DAMAGE,  LIABILITY OR EXPENSES TO THE EXTENT ARISING, AS TO ANY INDEMNIFIED  PERSON, (1) AS A RESULT OF THE GROSS NEGLIGENCE OR WILLFUL  MISCONDUCT OF SUCH INDEMNIFIED PERSON, AS DETERMINED BY A  COURT OF COMPETENT JURISDICTION IN A FINAL NON-APPEALABLE  JUDGMENT, (2) AS A RESULT OF A MATERIAL BREACH IN BAD FAITH BY  SUCH INDEMNIFIED PERSON OF ITS OBLIGATIONS UNDER THIS AGREEMENT  OR ANY LOAN DOCUMENT, AS DETERMINED BY A COURT OF COMPETENT  JURISDICTION IN A FINAL NON-APPEALABLE JUDGMENT, OR (3) AS A  RESULT OF DISPUTES SOLELY BETWEEN INDEMNIFIED PERSONS AND NOT  RELATING TO ANY ACTION OF SUCH INDEMNIFIED PARTY IN ITS CAPACITY  AS ADMINISTRATIVE AGENT OR ISSUING LENDER.  (c) BORROWER AGREES TO DEFEND, INDEMNIFY AND HOLD  HARMLESS EACH INDEMNIFIED PERSON FROM AND AGAINST ANY AND ALL  CLAIMS, DEMANDS, PENALTIES, FINES, LIABILITIES, SETTLEMENTS,  DAMAGES, COSTS OR EXPENSES OF WHATEVER KIND OR NATURE  (INCLUDING WITHOUT LIMITATION, REASONABLE AND DOCUMENTED  ATTORNEYS AND CONSULTANTS FEES, INVESTIGATION AND LABORATORY  FEES, ENVIRONMENTAL STUDIES REQUIRED BY ADMINISTRATIVE AGENT  OR ANY LENDER IN CONNECTION WITH THE VIOLATION OF HAZARDOUS  MATERIAL LAWS), COURT COSTS AND LITIGATION EXPENSES, ARISING OUT  OF OR RELATED TO (I) THE PRESENCE, USE, DISPOSAL, RELEASE OR  THREATENED RELEASE OF ANY HAZARDOUS MATERIALS ON, FROM OR  AFFECTING ANY PREMISES OWNED OR OCCUPIED BY ANY CREDIT PARTY  IN VIOLATION OF OR THE NON-COMPLIANCE WITH APPLICABLE  HAZARDOUS MATERIAL LAWS, (II) ANY PERSONAL INJURY (INCLUDING  WRONGFUL DEATH) OR PROPERTY DAMAGE (REAL OR PERSONAL) ARISING  OUT OF OR RELATED TO SUCH HAZARDOUS MATERIALS, (III) ANY LAWSUIT  OR OTHER PROCEEDING BROUGHT OR THREATENED, SETTLEMENT  REACHED OR GOVERNMENTAL ORDER OR DECREE RELATING TO SUCH  HAZARDOUS MATERIALS, AND/OR (IV) COMPLYING OR COMING INTO  COMPLIANCE WITH ALL HAZARDOUS MATERIAL LAWS (INCLUDING THE  COST OF ANY REMEDIATION OR MONITORING REQUIRED IN CONNECTION  THEREWITH) OR ANY OTHER REQUIREMENT OF LAW; PROVIDED,  HOWEVER, THAT BORROWER SHALL HAVE NO OBLIGATIONS UNDER THIS  SECTION 13.5(C) WITH RESPECT TO CLAIMS, DEMANDS, PENALTIES, FINES,  

 

  84134605.9   MRC Energy Company Credit Agreement 115  LIABILITIES, SETTLEMENTS, DAMAGES, COSTS OR EXPENSES OWING TO  ANY INDEMNIFIED PERSON TO THE EXTENT ARISING (A) AS A RESULT OF  THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH INDEMNIFIED  PERSON, AS DETERMINED BY A COURT OF COMPETENT JURISDICTION IN A  FINAL NON-APPEALABLE JUDGMENT, OR (B)  AFTER SUCH INDEMNIFIED  PERSON THEREOF TAKES POSSESSION OR CONTROL OF THE RELEVANT  PROPERTY AND NOT RESULTING FROM ANY ACTIONS OR OMISSIONS OF  BORROWER, PARENT OR ANY OF ITS SUBSIDIARIES.  THE OBLIGATIONS OF  BORROWER UNDER THIS SECTION 13.5(C) SHALL BE IN ADDITION TO ANY  AND ALL OTHER OBLIGATIONS AND LIABILITIES BORROWER MAY HAVE TO  ADMINISTRATIVE AGENT, ANY OF LENDERS OR ANY OTHER INDEMNIFIED  PERSON AT COMMON LAW OR PURSUANT TO ANY OTHER AGREEMENT.  (d) To the extent permitted by applicable law, (i) no Credit Party shall assert,  and each hereby waives, any claim against any Indemnified Person and (ii) neither the  Administrative Agent, nor any Issuing Lender or any Lender shall assert, and each hereby  waives, any claim against any Credit Party, in each case, 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 or any  agreement or instrument contemplated hereby, the transaction contemplated hereby, any  Advance or Letter of Credit or the use of the proceeds thereof.  13.6 Notices.  (a) Except as expressly provided otherwise in this Agreement (and except as  provided in clause (b) below), all notices and other communications provided to any party  hereto under this Agreement or any other Loan Document shall be in writing and shall be  given by personal delivery, by mail, by reputable overnight courier or by facsimile and  addressed or delivered to it at its address set forth on Schedule 13.6 or at such other address  as may be designated by such party in a notice to the other parties that complies as to  delivery with the terms of this Section 13.6 or posted to an E-System set up by or at the  direction of Administrative Agent (as set forth below).  Any notice, if personally delivered  or if mailed and properly addressed with postage prepaid and sent by registered or certified  mail, shall be deemed given when received or when delivery is refused; any notice, if given  to a reputable overnight courier and properly addressed, shall be deemed given two  (2) Business Days after the date on which it was sent, unless it is actually received sooner  by the named addressee; and any notice, if transmitted by facsimile, shall be deemed given  when received.  Administrative Agent may, but shall not be required to, take any action on  the basis of any notice given to it by telephone, but the giver of any such notice shall  promptly confirm such notice in writing or by facsimile, and such notice will not be deemed  to have been received until such confirmation is deemed received in accordance with the  provisions of this Section set forth above.  If such telephonic notice conflicts with any such  confirmation, the terms of such written notice shall control.  Any notice given by  Administrative Agent or any Lender to Borrower shall be deemed to be a notice to all of  the Credit Parties.  

 

  84134605.9   MRC Energy Company Credit Agreement 116  (b) Notices and other communications provided to Administrative Agent, the  Issuing Lenders and Lenders party hereto under this Agreement or any other Loan  Document may be delivered or furnished by electronic communication (including email  and Internet or intranet websites) pursuant to procedures approved by Administrative  Agent; provided that the foregoing shall not apply to notices pursuant to Article 2 and  Article 3 or to Compliance Certificates delivered pursuant to Section 7.2(a) unless  otherwise agreed by the Administrative Agent, the applicable Issuing Lender or the  applicable Lender, as the case may be.  Administrative Agent or Borrower may, in its  discretion, agree to accept notices and other communications to it hereunder by electronic  communications (including email and any E-System) pursuant to procedures approved by  it.  Unless otherwise agreed to in a writing by and among the parties to a particular  communication, (i) notices and other communications sent to an email address shall be  deemed received upon the sender’s receipt of an acknowledgment from the intended  recipient (such as by the “return receipt requested” function, return email, or other written  acknowledgment) and (ii) notices and other communications posted to any E-System shall  be deemed received upon the deemed receipt by the intended recipient at its email address  as described in the foregoing clause (i) of notification that such notice or other  communication is available and identifying the website address therefore.  (c) Each of Borrower, the Administrative Agent and each Issuing Lender may  change its address, facsimile or telephone number for notices and other communications  hereunder by notice to the other parties hereto.  Each other Lender may change its address,  facsimile or telephone number for notices and other communications hereunder by notice  to Borrower, the Administrative Agent and each Issuing Lender.  In addition, each Lender  agrees to notify the Administrative Agent from time to time to ensure that the  Administrative Agent has on record (i) an effective address, contact name, telephone  number, facsimile number and electronic mail address to which notices and other  communications may be sent and (ii) accurate wire instructions for such Lender.   Furthermore, each Public Lender agrees to cause at least one individual at or on behalf of  such Public Lender to at all times have selected the “Private Side Information” or similar  designation on the content declaration screen of the Platform in order to enable such Public  Lender or its delegate, in accordance with such Public Lender’s compliance procedures  and applicable law, including United States Federal and state securities laws, to make  reference to Borrower Materials that are not made available through the “Public Side  Information” portion of the Platform and that may contain material non-public information  with respect to Borrower or its securities for purposes of United States Federal or state  securities laws.  13.7 Successors and Assigns; Participations; Assignments.  (a) Successors and Assigns Generally.  The provisions of this Agreement shall  be binding upon and inure to the benefit of the parties hereto and their respective successors  and assigns permitted hereby, except that Borrower may not assign or otherwise transfer  any of its rights or obligations hereunder without the prior written consent of the  Administrative Agent and each Lender, and no Lender may assign or otherwise transfer  any of its rights or obligations hereunder except (i) to an assignee in accordance with the  provisions of paragraph (b) of this Section, (ii) by way of participation in accordance with  

 

  84134605.9   MRC Energy Company Credit Agreement 117  the provisions of paragraph (d) of this Section, or (iii) by way of pledge or assignment of  a security interest subject to the restrictions of paragraph (f) of this Section (and any other  attempted assignment or transfer by any party hereto shall be null and void).  Nothing in  this Agreement, expressed or implied, shall be construed to confer upon any Person (other  than the parties hereto, their respective successors and assigns permitted hereby,  Participants to the extent provided in paragraph (d) of this Section and, to the extent  expressly contemplated hereby, the Related Parties of each of the Administrative Agent  and the Lenders) any legal or equitable right, remedy or claim under or by reason of this  Agreement.  (b) Assignments by Lenders.  Any Lender may at any time assign to one or  more assignees all or a portion of its rights and obligations under this Agreement (including  all or a portion of its Revolving Credit Commitment Amount and the Advances at the time  owing to it); provided that any such assignment shall be subject to the following conditions:  (i) Minimum Amounts.  (A) in the case of an assignment of the entire remaining amount  of the assigning Lender’s Revolving Credit Commitment Amount and/or  the Advances at the time owing to it, no minimum amount need be assigned;  and  (B) in any case not described in paragraph (b)(i)(A) of this  Section, the aggregate amount of the Revolving Credit Commitment  Amount (which for this purpose includes Advances outstanding thereunder)  or, if the applicable Revolving Credit Commitment Amount 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  $5,000,000, unless each of the Administrative Agent and, so long as no  Event of Default has occurred and is continuing, Borrower otherwise  consents (each such consent not to be unreasonably withheld or delayed).  (ii) Proportionate Amounts.  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 Advance or the Revolving  Credit Commitment Amount assigned.  (iii) Required Consents.  No consent shall be required for any  assignment except to the extent required by paragraph (b)(i)(B) of this Section and,  in addition:  (A) the consent of Borrower (such consent not to be  unreasonably withheld or delayed) shall be required unless (x) an Event of  

 

  84134605.9   MRC Energy Company Credit Agreement 118  Default has occurred and is continuing at the time of such assignment, or  (y) such assignment is to a Lender or an Affiliate of a Lender;  (B) the consent of the Administrative Agent (such consent not to  be unreasonably withheld or delayed) shall be required for assignments if  such assignment is to a Person that is not a Lender or an Affiliate of such  Lender; and  (C) the consent of each Issuing Lender.  (iv) Assignment and Assumption.  The parties to each assignment shall  execute and deliver to the Administrative Agent an Assignment and Assumption,  together with a processing and recordation fee of $3,500 for which Borrower shall  not be responsible; provided that the Administrative Agent may, in its sole  discretion, elect to waive such processing and recordation fee in the case of any  assignment.  The assignee, if it is not a Lender, shall deliver to the Administrative  Agent an Administrative Questionnaire.  (v) No Assignment to Certain Persons.  No such assignment shall be  made to (A) Borrower or any of Borrower’s Affiliates or Subsidiaries, (B) to any  Defaulting Lender or any of its Subsidiaries, or any Person who, upon becoming a  Lender hereunder, would constitute any of the foregoing Persons described in this  clause (B) or (C) a hedge fund, loan fund, investment fund, trust or other similar  investment vehicle or entity without the prior written approval of Borrower.  (vi) No Assignment to Natural Persons.  No such assignment shall be  made to a natural Person.  (vii) Certain Additional Payments.  In connection with any assignment of  rights and obligations of any Defaulting Lender hereunder, no such assignment  shall be effective unless and until, in addition to the other conditions thereto set  forth herein, the parties to the assignment shall make such additional payments to  the Administrative Agent in an aggregate amount sufficient, upon distribution  thereof as appropriate (which may be outright payment, purchases by the assignee  of participations or subparticipations, or other compensating actions, including  funding, with the consent of Borrower and the Administrative Agent, the applicable  pro rata share of Advances previously requested but not funded by the Defaulting  Lender, to each of which the applicable assignee and assignor hereby irrevocably  consent), to (x) pay and satisfy in full all payment liabilities then owed by such  Defaulting Lender to the Administrative Agent, each Issuing Lender and each other  Lender hereunder (and interest accrued thereon), and (y) acquire (and fund as  appropriate) its full pro rata share of all Advances and participations in Letters of  Credit in accordance with its Revolving Credit Percentage.  Notwithstanding the  foregoing, in the event that any assignment of rights and obligations of any  Defaulting Lender hereunder shall become effective under applicable law without  compliance with the provisions of this paragraph, then the assignee of such interest  

 

  84134605.9   MRC Energy Company Credit Agreement 119  shall be deemed to be a Defaulting Lender for all purposes of this Agreement until  such compliance occurs.  Subject to acceptance and recording thereof by the Administrative Agent pursuant to  paragraph (c) of this Section, from and after the effective date specified in each Assignment  and Assumption, the 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  Section 3.4(c), Section 11.1, Section 11.5, Section 11.6, Section 11.9 and Section 13.5 with  respect to facts and circumstances occurring prior to the effective date of such assignment;  provided, that except to the extent otherwise expressly agreed by the affected parties, no  assignment by a Defaulting Lender will constitute a waiver or release of any claim of any  party hereunder arising from that Lender’s having been a Defaulting Lender.  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  (d) of this Section.  (c) Register.  The Administrative Agent, acting solely for this purpose as an  agent of Borrower, shall maintain at one of its offices in the United States of America 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 Credit Commitment  Amounts of, and principal amounts (and stated interest) 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 Borrower, the Administrative Agent  and the Lenders shall 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.  The Register  shall be available for inspection by Borrower and any Lender, at any reasonable time and  from time to time upon reasonable prior notice.  (d) Participations.  Any Lender may at any time, without the consent of, or  notice to, Borrower or the Administrative Agent, sell participations to any Person (other  than a natural Person or Borrower or any of Borrower’s Affiliates or Subsidiaries) (each, a  “Participant”) in all or a portion of such Lender’s rights and/or obligations under this  Agreement (including all or a portion of its Revolving Credit Commitment Amount 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) Borrower, the  Administrative Agent, the Issuing Lenders and Lenders shall continue to deal solely and  directly with such Lender in connection with such Lender’s rights and obligations under  this Agreement.  For the avoidance of doubt, each Lender shall be responsible for the  indemnity under Section 12.7 with respect to any payments made by such Lender to its  Participant(s).  

 

  84134605.9   MRC Energy Company Credit Agreement 120  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 the first proviso to Section 13.9(b) that affects such Participant.  Borrower agrees that  each Participant shall be entitled to the benefits of Section 3.4(c), Section 11.1, Section  11.5, Section 11.6, and Section 11.9 (subject to the requirements and limitations therein,  including the requirements under Section 11.9(g) (it being understood that the  documentation required under Section 11.9(g) shall be delivered to the participating  Lender)) to the same extent as if it were a Lender and had acquired its interest by  assignment pursuant to paragraph (b) of this Section; provided that such Participant (A)  agrees to be subject to the provisions of Section 13.11 as if it were an assignee under  paragraph (b) of this Section; and (B) shall not be entitled to receive any greater payment  under Section 3.4(c), Section 11.5, Section 11.6 or Section 11.9, with respect to any  participation, than its participating Lender would have been entitled to receive, unless the  sale of the participation to such Participant is made with Borrower’s prior written consent.   Each Lender that sells a participation agrees, at Borrower's request and expense, to use  reasonable efforts to cooperate with Borrower to effectuate the provisions of Section 13.11  with respect to any Participant.  To the extent permitted by law, each Participant also shall  be entitled to the benefits of Section 9.6 as though it were a Lender; provided that such  Participant agrees to be subject to Section 10.3 as though it were a Lender.  Each Lender  that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of  Borrower, maintain a register on which it enters the name and address of each Participant  and the principal amounts (and stated interest) of each Participant’s interest in the  Advances or other obligations under the Loan Documents (the “Participant Register”);  provided that no Lender shall have any obligation to disclose all or any portion of the  Participant Register (including the identity of any Participant or any information relating  to a Participant's interest in any commitments, loans, letters of credit or its other obligations  under any Loan Document) to any Person except to the extent that such disclosure is  necessary to establish that such commitment, loan, letter of credit or other obligation is in  registered form under Section 5f.103-1(c) of the United States Treasury Regulations.  The  entries in the Participant Register shall be conclusive absent manifest error, and such  Lender shall treat each Person whose name is recorded in the Participant Register as the  owner of such participation for all purposes of this Agreement notwithstanding any notice  to the contrary.  For the avoidance of doubt, the Administrative Agent (in its capacity as  Administrative Agent) shall have no responsibility for maintaining a Participant Register.  (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.  13.8 Counterparts.  This Agreement and each other Loan Document may be executed in  one or more counterparts (and by different parties hereto in different counterparts), each of which  

 

  84134605.9   MRC Energy Company Credit Agreement 121  shall be deemed an original, but all of which together shall constitute one and the same  instrument.  Delivery by fax or other electronic transmission of an executed counterpart of a  signature page to this Agreement and each other Loan Document shall be effective as delivery of  an original executed counterpart of this Agreement and such other Loan Document and the words  “execution,” “execute”, “signed,” “signature,” and words of like import in or related to any  document to be signed in connection with this Agreement or any other Loan Document shall be  deemed to include electronic signatures, the electronic matching of assignment terms and contract  formations on electronic platforms approved by Administrative Agent, 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 other similar state laws based on the  Uniform Electronic Transactions Act.  Administrative Agent may, in its discretion, require that  any such documents and signatures executed electronically or delivered by fax or other electronic  transmission be confirmed by a manually-signed original thereof; provided that the failure to  request or deliver the same shall not limit the effectiveness of any document or signature executed  electronically or delivered by fax or other electronic transmission.  13.9 Amendment and Waiver.  (a) No amendment or waiver of any provision of this Agreement or any other  Loan 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 Administrative Agent  and the Majority Lenders (or by Administrative Agent at the written request of the Majority  Lenders) or, if this Agreement expressly so requires with respect to the subject matter  thereof, by all Lenders (and, with respect to any amendments to this Agreement or the other  Loan Documents, by the Parent, or any Credit Party or the Guarantors that are signatories  thereto), and then such waiver or consent shall be effective only in the specific instance  and for the specific purpose for which given.  All references in this Agreement to “Lenders”  shall refer to all Lenders, unless expressly stated to refer to Majority Lenders or  Supermajority Lenders (or the like).  (b) Notwithstanding anything to the contrary herein,  (i) no amendment, waiver or consent shall increase the stated amount  of any Lender’s Revolving Credit Commitment Amount hereunder without such  Lender’s consent;  (ii) no amendment, waiver or consent shall, unless in writing and signed  by each Lender holding Indebtedness directly affected thereby, do any of the  following:  (A) reduce the principal of, or interest on, any outstanding  Advance or Letter of Credit Obligation or any Fees or other amounts  payable hereunder; or  

 

  84134605.9   MRC Energy Company Credit Agreement 122  (B) postpone any date fixed for any payment of principal of, or  interest on, any outstanding Indebtedness (other than Lender Hedging  Obligations and Lender Product Obligations) or any Fees or other amounts  payable hereunder (except with respect to the payments required under  Section 2.10);  (iii) no amendment, waiver or consent shall, unless in writing and signed  by all Lenders, do any of the following:  (A) change any of the provisions of this Section 13.9 or the  definitions of “Majority Lenders”, “Supermajority Lenders” or any other  provision of any Loan Document specifying the number or percentage of  Lenders required to waive, amend or modify any rights thereunder or make  any determination or grant any consent thereunder;   (B) increase the Borrowing Base or modify the definition of  “Borrowing Base”;  (C) except as expressly permitted hereunder or under the  Collateral Documents, release all or substantially all of the Collateral  (provided that neither Administrative Agent nor any Lender shall be  prohibited thereby from proposing or participating in a consensual or  nonconsensual debtor-in-possession or similar financing), or release any  material guaranty provided by any Person in favor of Administrative Agent  and Lenders, provided however that Administrative Agent shall be entitled,  without notice to or any further action or consent of Lenders, to release any  Collateral which any Credit Party is permitted to sell, assign or otherwise  transfer in compliance with this Agreement or the other Loan Documents  or release any guaranty to the extent expressly permitted in this Agreement  or any of the other Loan Documents (whether in connection with the sale,  transfer or other disposition of the applicable Guarantor or otherwise);  (D) increase the maximum duration of Interest Periods permitted  hereunder;   (E) modify Sections 10.2 or 10.3;  (F) increase the Maximum Facility Amount; or  (G) increase the aggregate Revolving Credit Commitment  Amounts to exceed eighty percent (80%) of the Borrowing Base;  (iv) any amendment, waiver or consent that will (A) amend any  provision in Article 3 or (B) otherwise affect the rights or duties of any Issuing  Lender under this Agreement or any of the other Loan Documents, shall require the  written concurrence of such Issuing Lender; and  

 

  84134605.9   MRC Energy Company Credit Agreement 123  (v) any amendment, waiver, or consent that will affect the rights or  duties of Administrative Agent under this Agreement or any other Loan Document,  shall require the written concurrence of Administrative Agent.  (c) Notwithstanding anything to the contrary herein, no Defaulting Lender shall  have any right to approve or disapprove of any amendment, consent, waiver or any other  modification to any Loan Document (and all amendments, consents, waivers and other  modifications may be effected without the consent of the Defaulting Lenders), except that  the foregoing shall not permit, in each case without such Defaulting Lender’s consent,  (i) an increase in such Defaulting Lender’s Revolving Credit Commitment Amount, (ii) the  waiver, forgiveness or reduction of the principal amount of any Advance or Letter of Credit  Obligations owing to such Defaulting Lender (unless all other Lenders affected thereby are  treated similarly), (iii) the extension of the final maturity date(s) of such Defaulting  Lenders’ portion of any of the Indebtedness or the extension of any commitment to extend  credit of such Defaulting Lender, or (iv) any other modification which requires the consent  of all Lenders or Lender(s) affected thereby which affects such Defaulting Lender more  adversely than the other affected Lenders (other than a modification which results in a  reduction of such Defaulting Lender’s Revolving Credit Percentage of any Commitments  or repayment of any amounts owing to such Defaulting Lender on a non pro-rata basis).   For the avoidance of doubt, a Defaulting Lender shall not have the right to approve or  disapprove any redetermination of the Borrowing Base.  (d) Notwithstanding anything to the contrary herein, nothing in this Agreement  shall be interpreted to require that any waiver, amendment, modification or consent to any  Commodity Hedging Agreement, Interest Rate Agreement, Letter of Credit Document or  any document executed or delivered in connection with any Lender Product require the  consent of any Lender.  (e) Notwithstanding anything to the contrary herein Administrative Agent may,  with the consent of Borrower only, amend, modify or supplement this Agreement or any  of the other Loan Documents to cure any ambiguity, omission, mistake, defect or  inconsistency.  13.10 Confidentiality.  Each of the Administrative Agent, the Lenders and the Issuing  Lenders agrees to maintain the confidentiality of the Information (as defined below), except that  Information may be disclosed (a) to its Affiliates and to its Related Parties (it being understood  that the Persons to whom such disclosure is made will be informed of the confidential nature of  such Information and instructed to keep such Information confidential), (b) to the extent required  or requested by any regulatory authority purporting to have jurisdiction over such Person or its  Related Parties (including any self-regulatory authority, such as the National Association of  Insurance Commissioners), (c) to the extent required by applicable laws or regulations or by any  subpoena or similar legal process, (d) to any other party hereto, (e) in connection with the exercise  of any remedies hereunder or under any other Loan Document or any action or proceeding relating  to this Agreement or any other Loan Document or the enforcement of rights hereunder or  thereunder, (f) subject to an agreement containing provisions substantially the same as those of  this Section, to (i) any assignee of or participant in, or any prospective assignee of or participant  in, any of its rights and obligations under this Agreement, or any Eligible Assignee, or (ii) any  

 

  84134605.9   MRC Energy Company Credit Agreement 124  actual or prospective party (or its Related Parties) to any swap, derivative or other transaction  under which payments are to be made by reference to Borrower and its obligations, this Agreement  or payments hereunder, (g) on a confidential basis to (i) any Rating Agency in connection with  rating the Parent, Borrower or the Restricted Subsidiaries or the credit facilities provided hereunder  or (ii) the CUSIP Service Bureau or any similar agency in connection with the issuance and  monitoring of CUSIP numbers or other market identifiers with respect to the credit facilities  provided hereunder, (h) with the consent of Borrower or (i) to the extent such Information  (x) becomes publicly available other than as a result of a breach of this Section or (y) becomes  available to the Administrative Agent, any Lender, any Issuing Lender or any of their respective  Affiliates on a nonconfidential basis from a source other than Borrower.  For purposes of this Section, “Information” means (i) all information received from the Parent,  Borrower or any Subsidiary relating to the Parent, Borrower or any Subsidiary, or any of their  respective businesses, other than any such information that is available to the Administrative  Agent, any Lender or any Issuing Lender on a nonconfidential basis prior to disclosure by the  Parent, Borrower or any Subsidiary, provided that, in the case of information received from the  Parent, Borrower or any Subsidiary after the date hereof, such information is clearly identified at  the time of delivery as confidential.  Any Person required to maintain the confidentiality of  Information as provided in this Section shall be considered to have complied with its obligation to  do so if such Person has exercised the same degree of care to maintain the confidentiality of such  Information as such Person would accord to its own confidential information.  For the avoidance  of doubt, any Reserve Report, engineering report, geologic data, financial statements or financial  information furnished by Parent or any Credit Party to Administrative Agent or any Lender shall  constitute Information and be treated as “confidential” for the purposes of this Section.  Each of the Administrative Agent, the Lenders and the Issuing Lenders acknowledges that  (a) the Information may include material non-public information concerning the Parent, Borrower  or a Subsidiary, as the case may be, (b) it has developed compliance procedures regarding the use  of material non-public information and (c) it will handle such material non-public information in  accordance with applicable law, including United States Federal and state securities laws.  13.11 Substitution or Removal of Lenders.  (a) With respect to any Lender (i) whose obligation to make Eurodollar-based  Advances has been suspended pursuant to Section 11.4, (ii) that has demanded  compensation under Sections 3.4(c), 11.5 or 11.6, (iii) that has become a Defaulting  Lender, (iv) that has not approved an increase in the Borrowing Base that has been  approved by the Supermajority Lenders or (v) that has failed to consent to a requested  amendment, waiver or modification to any Loan Document as to which the Majority  Lenders have already consented (in each case, an “Affected Lender”), then Borrower may,  at Borrower’s sole expense, require the Affected Lender to sell and assign all of its  interests, rights and obligations under this Agreement, including, without limitation, its  Revolving Credit Commitment Amount, to an Eligible Assignee (which may be one or  more of Lenders) (such assignee shall be referred to herein as the “Purchasing Lender” or  “Purchasing Lenders”) within two (2) Business Days after receiving notice from Borrower  requiring it to do so, for an aggregate price equal to the sum of the portion of all Advances  made by it, interest and fees accrued for its account through but excluding the date of such  

 

  84134605.9   MRC Energy Company Credit Agreement 125  payment, and all other amounts payable to it hereunder, from the Purchasing Lender(s) (to  the extent of such outstanding principal and accrued interest and fees) or Borrower (in the  case of all other amounts, including without limitation, if demanded by the Affected  Lender, the amount of any compensation then due to the Affected Lender under  Sections 3.4(c), 11.1, 11.5 and 11.6 to but excluding said date), payable (in immediately  available funds) in cash.  The Affected Lender, as assignor, such Purchasing Lender, as  assignee, Borrower and Administrative Agent, shall enter into an Assignment and  Assumption pursuant to Section 13.7, whereupon such Purchasing Lender shall be a  Lender party to this Agreement, shall be deemed to be an assignee hereunder and shall  have all the rights and obligations of a Lender with a Revolving Credit Commitment  Amount equal to the Affected Lender’s Revolving Credit Percentage (immediately prior to  such assignment) of the then applicable Revolving Credit Aggregate Commitment,  provided, however, that if the Affected Lender does not execute such Assignment and  Assumption within (2) Business Days of receipt thereof, Administrative Agent may  execute the Assignment and Assumption as the Affected Lender’s attorney-in-fact. Each  of Lenders hereby irrevocably constitutes and appoints Administrative Agent and any  officer or agent thereof, with full power of substitution, as its true and lawful attorney-in- fact with full power and authority in the name of such Lender or in its own name to execute  and deliver the Assignment and Assumption while such Lender is an Affected Lender  hereunder (such power of attorney to be deemed coupled with an interest and irrevocable).   In connection with any assignment pursuant to this Section 13.11, Purchasing Lender shall  pay to Administrative Agent the processing and recordation fee required under  Section 13.7.  (b) If any Lender is an Affected Lender of the type described in Section  13.11(a)(iii) and (iv) (any such Lender, a “Non-Compliant Lender”), Borrower may, with  the prior written consent of Administrative Agent (which consent shall not be unreasonably  withheld, conditioned or delayed), and notwithstanding Section 10.3 of this Agreement or  any other provisions requiring pro rata payments to Lenders, elect to reduce the Revolving  Credit Aggregate Commitment by an amount equal to the Non-Compliant Lender’s  Revolving Credit Percentage of the Revolving Credit Aggregate Commitment and repay  such Non-Compliant Lender an amount equal the principal amount of all Advances owing  to it, all interest and fees accrued for its account through but excluding the date of such  repayment, and all other amounts payable to it hereunder (including without limitation, if  demanded by the Non-Compliant Lender, the amount of any compensation then due to the  Non-Compliant Lender under Sections 3.4(c), 11.1, 11.5 and 11.6 to but excluding said  date), payable (in immediately available funds) in cash, so long as, after giving effect to  the termination of such Non-Compliant Lender’s Revolving Credit Commitment Amount  and the repayments described in this clause (b), any Fronting Exposure of such Non- Compliant Lender shall be reallocated among Lenders that are not Non-Compliant Lenders  in accordance with their respective Revolving Credit Percentages, but only to the extent  that the sum of the aggregate principal amount of all Revolving Credit Advances made by  each such Lender, plus such Lender’s Revolving Credit Percentage of the aggregate  outstanding principal amount of Letter of Credit Obligations prior to giving effect to such  reallocation plus such Lender’s Revolving Credit Percentage of the Fronting Exposure to  be reallocated does not exceed such Lender’s Revolving Credit Percentage of the  Revolving Credit Aggregate Commitment and only so long as no Default or Event of  

 

  84134605.9   MRC Energy Company Credit Agreement 126  Default has occurred and is continuing on the date of such reallocation; provided that with  respect to any portion of the Fronting Exposure that may not be reallocated, Borrower shall  deliver to Administrative Agent, for the benefit of each Issuing Lender, cash collateral or  other security satisfactory to Administrative Agent, with respect any such remaining  Fronting Exposure.  13.12 WAIVER OF JURY TRIAL.  LENDERS, ADMINISTRATIVE AGENT AND  BORROWER KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY  RIGHT ANY OF THEM MAY HAVE TO A TRIAL BY JURY IN ANY LITIGATION BASED  UPON OR ARISING OUT OF THIS AGREEMENT, THE OTHER LOAN DOCUMENTS OR  ANY RELATED INSTRUMENT OR AGREEMENT OR ANY OF THE TRANSACTIONS  CONTEMPLATED BY THIS AGREEMENT OR ANY COURSE OF CONDUCT, DEALING,  STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTION OF ANY OF THEM.   NEITHER LENDERS, ADMINISTRATIVE AGENT NOR BORROWER SHALL SEEK TO  CONSOLIDATE, BY COUNTERCLAIM OR OTHERWISE, ANY SUCH ACTION IN WHICH  A JURY TRIAL HAS BEEN WAIVED WITH ANY OTHER ACTION IN WHICH A JURY  TRIAL CANNOT BE OR HAS NOT BEEN WAIVED.  THESE PROVISIONS SHALL NOT  BE DEEMED TO HAVE BEEN MODIFIED IN ANY RESPECT OR RELINQUISHED BY  LENDERS, ADMINISTRATIVE AGENT OR BORROWER EXCEPT BY A WRITTEN  INSTRUMENT EXECUTED BY ALL OF THEM.  13.13 USA Patriot Act Notice.  Pursuant to Section 326 of the USA Patriot Act,  Administrative Agent and Lenders hereby notify the Credit Parties that if they or any of their  Subsidiaries or the Parent open an account, including any loan, deposit account, treasury  management account, or other extension of credit with Administrative Agent or any Lender,  Administrative Agent or the applicable Lender will request the applicable Person’s name, tax  identification number, business address and other information necessary to identify such Person  (and may request such Person’s organizational documents or other identifying documents) to the  extent necessary for Administrative Agent and the applicable Lender to comply with the USA  Patriot Act.  13.14 Complete Agreement; Conflicts.  THIS WRITTEN AGREEMENT  REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT  BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR  SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.  THERE ARE NO  UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.  In the event of any  conflict between the terms of this Agreement and the other Loan Documents, this Agreement shall  govern.  13.15 Severability.  In case any one or more of the obligations of the Credit Parties under  this Agreement, the Notes or any of the other Loan Documents shall be invalid, illegal or  unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining  obligations of the Credit Parties shall not in any way be affected or impaired thereby, and such  invalidity, illegality or unenforceability in one jurisdiction shall not affect the validity, legality or  enforceability of the obligations of the Credit Parties under this Agreement, the Notes or any of  the other Loan Documents in any other jurisdiction.  

 

  84134605.9   MRC Energy Company Credit Agreement 127  13.16 Table of Contents and Headings; Section References.  The table of contents and the  headings of the various subdivisions hereof are for convenience of reference only and shall in no  way modify or affect any of the terms or provisions hereof and references herein to “sections,”  “subsections,” “clauses,” “paragraphs,” “subparagraphs,” “exhibits” and “schedules” shall be to  sections, subsections, clauses, paragraphs, subparagraphs, exhibits and schedules, respectively, of  this Agreement unless otherwise specifically provided herein or unless the context otherwise  clearly indicates.  13.17 Electronic Transmissions.  (a) Each of Administrative Agent, the Credit Parties, Lenders, and each of their  Affiliates is authorized (but not required) to transmit, post or otherwise make or  communicate, in its sole discretion, Electronic Transmissions in connection with any Loan  Document and the transactions contemplated therein.  Borrower and each other Credit  Party hereby acknowledges and agrees that the use of Electronic Transmissions is not  necessarily secure and that there are risks associated with such use, including risks of  interception, disclosure and abuse and each indicates it assumes and accepts such risks by  hereby authorizing the transmission of Electronic Transmissions.  (b) All uses of an E-System shall be governed by and subject to, in addition to  Section 13.6 and this Section 13.17, separate terms and conditions posted or referenced in  such E-System and related contractual obligations executed by Administrative Agent, the  Credit Parties and Lenders in connection with the use of such E-System.  (c) All E-Systems and Electronic Transmissions shall be provided “as is” and  “as available”.  None of Administrative Agent or any of its Affiliates, nor Borrower or any  of its respective Affiliates warrants the accuracy, adequacy or completeness of any E- Systems or Electronic Transmission, and each disclaims all liability for errors or omissions  therein.  No warranty of any kind is made by Administrative Agent or any of its Affiliates,  or Borrower or any of its respective Affiliates in connection with any E-Systems or  Electronic Transmission, including any warranty of merchantability, fitness for a particular  purpose, non-infringement of third-party rights or freedom from viruses or other code  defects.  Administrative Agent, Borrower and its Subsidiaries, and Lenders agree that  Administrative Agent has no responsibility for maintaining or providing any equipment,  software, services or any testing required in connection with any Electronic Transmission  or otherwise required for any E-System.  Administrative Agent and Lenders agree that  Borrower has no responsibility for maintaining or providing any equipment, software,  services or any testing required in connection with any Electronic Transmission or  otherwise required for any E-System.  13.18 Reliance on and Survival of Provisions.  All terms, covenants, agreements,  representations and warranties of the Credit Parties and the Parent to any of the Loan Documents  made herein or in any of the Loan Documents or in any certificate, report, financial statement or  other document furnished by or on behalf of any Credit Party or the Parent in connection with this  Agreement or any of the Loan Documents shall be deemed to have been relied upon by Lenders,  notwithstanding any investigation heretofore or hereafter made by any Lender or on such Lender’s  behalf, and those covenants and agreements of Borrower set forth in Section 13.5 (together with  

 

  84134605.9   MRC Energy Company Credit Agreement 128  any other indemnities of any Credit Party or Parent contained elsewhere in this Agreement or in  any of the other Loan Documents) and of Lenders set forth in Section 12.7 shall survive the  repayment in full of the Indebtedness and the termination of any commitment to extend credit.  13.19 Concerning Lender Hedging Obligations and Lender Product Obligations.  The  benefit of the Collateral Documents and of the provisions of this Agreement relating to any  collateral securing the Indebtedness shall also extend to the Lender Hedging Obligations and the  Lender Product Obligations; provided that if any Lender Counterparty ceases to be a Lender or an  Affiliate of a Lender hereunder, (a) such Lender Hedging Obligations shall only include  obligations under Commodity Hedging Agreements and Interest Rate Agreements entered into  with such Person to the extent arising from transactions and confirmations entered into at any time  such Person was a Lender or an Affiliate of a Lender hereunder, without giving effect to any  extension, increases or modifications thereof which are made after such Person ceases to be a  Lender or an Affiliate of a Lender hereunder and (b) any obligations arising under Lender Products  extended by such Person shall no longer constitute Lender Product Obligations.  No Lender or any  Affiliate of a Lender shall have any voting rights under any Loan Document or with respect to any  Collateral, as a result of the existence of obligations owed to it under any Commodity Hedging  Agreements, Interest Rate Agreements or agreements relating to Lender Products.  All Commodity  Hedging Agreements, Interest Rate Agreements and agreements relating to Lender Products, if  any, are independent agreements governed by the written provisions of such agreements, which  will remain in full force and effect, unaffected by any repayment, prepayment, acceleration,  reduction, increase or change in the terms of the Advances or this Agreement, except as otherwise  expressly provided in such agreements, and any payoff statement from any Lender relating to this  Agreement shall not apply to such agreements except as otherwise expressly provided in such  payoff statement.  13.20 Release of Guarantees and Liens.  (a) Notwithstanding anything to the contrary contained herein or in any other  Loan Document, the Administrative Agent is hereby irrevocably authorized (but not  required) by each Lender (without requirement of notice to or consent of any Lender except  as expressly required by Section 13.9) to take any action requested by Borrower having the  effect of releasing any Collateral or guarantee obligations (i) to the extent necessary to  permit consummation of any transaction not prohibited by any Loan Document or that has  been consented to in accordance with Section 13.9 or (ii) under the circumstances  described in paragraph (b), (c) or (d) below.  (b) At such time as (i) the Advances and the other Indebtedness (other than  contingent indemnification and reimbursement obligations for which no claim has been  made and Lender Product Obligations) shall have been paid in full in cash, (ii) the  Revolving Credit Aggregate Commitment has been terminated and no Letters of Credit  shall be outstanding (other than Letters of Credit that have been cash collateralized or  otherwise backstopped in a manner satisfactory to the applicable Issuing Lender), and (iii)  all Lender Hedging Obligations shall have terminated or acceptable substitute collateral  shall have been posted to secure such Lender Hedging Obligations or such Lender Hedging  Obligations shall have been novated to third parties, the Collateral shall be released from  the Liens created by the Collateral Documents, and the Collateral Documents and all  

 

  84134605.9   MRC Energy Company Credit Agreement 129  obligations (other than those expressly stated to survive such termination) of each Credit  Party under the Collateral Documents shall terminate, all without delivery of any  instrument or performance of any act by any Person.  Administrative Agent agrees, upon  the request of Borrower, to promptly execute and deliver to Borrower any and all Lien  releases as may be required to effectuate the foregoing.  (c) If any of the Collateral shall be sold, transferred or otherwise Disposed of  by any Credit Party in a transaction permitted by this Agreement or any other Loan  Document, then the Administrative Agent, at the request and sole expense of Borrower,  shall execute and deliver to the relevant Credit Party all releases or other documents  reasonably necessary or desirable for the release of the Liens created by the Collateral  Documents on such Collateral.  At the request and sole expense of Borrower, a Guarantor  that is a Restricted Subsidiary shall be released from its obligations hereunder, under the  Guaranty and under the Collateral Documents in the event that any of the Equity Interests  issued by such Guarantor shall be Disposed of in a transaction permitted by this  Agreement; provided that Borrower shall have delivered to the Administrative Agent, at  least five (5) Business Days prior to the date of the proposed release, a written request for  release identifying the relevant Guarantor and the terms of the Disposition in reasonable  detail, including the price thereof and any anticipated expenses in connection therewith.  (d) If any Restricted Subsidiary shall become an Unrestricted Subsidiary in  accordance with this Agreement, then so long as there exists no (x) Default or Event of  Default, or (y) Borrowing Base Deficiency, in each case both prior to and/or immediately  after taking such action, all obligations of such Unrestricted Subsidiary under the Loan  Documents shall automatically terminate, and the Administrative Agent, at the request and  sole expense of Borrower, shall (i) release all Liens created by the Collateral Documents  on (A) any and all property of such Unrestricted Subsidiary, and (B) any and all Equity  Interests issued by such Unrestricted Subsidiary, and (ii) deliver to Borrower any and all  certificates representing such Equity Interests that were pledged to the Administrative  Agent pursuant to the Collateral Documents.  (e) Administrative Agent shall promptly release its Lien on any property of a  Credit Party that is not Collateral upon the written request of such Credit Party.  13.21 Existing Credit Agreement.  On the Effective Date, this Agreement shall supersede  and replace in its entirety the Existing Credit Agreement; provided, however, that (a) all loans,  letters of credit, interest periods, and other indebtedness, obligations and liabilities outstanding  under the Existing Credit Agreement on such date shall continue to constitute Advances, Letters  of Credit, Interest Periods and other Indebtedness, obligations and liabilities under this Agreement,  (b) the execution and delivery of this Agreement or any of the Loan Documents hereunder shall  not constitute a novation or refinancing or any other fundamental change in the relationship among  the parties, and (c) the Advances, Letters of Credit, Interest Periods and other Indebtedness,  obligations and liabilities outstanding hereunder, to the extent outstanding under the Existing  Credit Agreement immediately prior to the date hereof, shall constitute the same loans, letters of  credit, interest periods and other indebtedness, obligations and liabilities as were outstanding under  the Existing Credit Agreement.  Notwithstanding any provision of this Agreement or any other  Loan Document or instrument executed in connection herewith, the execution and delivery of this  

 

  84134605.9   MRC Energy Company Credit Agreement 130  Agreement and the incurrence of the Indebtedness hereunder shall be in substitution for, but not  in payment of, the Indebtedness owed by Borrower under the Existing Credit Agreement.  13.22 Reallocation of Commitments and Revolving Credit Advances.  The Lenders  (including the Withdrawing Lenders) party to the Existing Credit Agreement have agreed among  themselves to reallocate their respective Commitments (as defined in the Existing Credit  Agreement) as contemplated by this Agreement, and to, among other things, allow certain financial  institutions identified by the Joint Lead Arrangers in consultation with Borrower, to become a  party to this Agreement as a Lender (each, a “New Lender”).  On the Effective Date and after  giving effect to such reallocation and adjustment of the Commitments, the Commitments and  Revolving Credit Percentages of each Lender, including each New Lender, shall be as set forth on  Schedule 1.2 and each Lender, including each New Lender, shall own its Revolving Credit  Percentage of the outstanding Revolving Credit Advances.  The reallocation and adjustment to the  Commitments of each Lender, including each New Lender, as contemplated by this Section 13.22  shall be deemed to have been consummated pursuant to the terms of the Assignment and  Assumption attached as Exhibit C hereto as if each of the Lenders, including each New Lender,  had executed an Assignment and Assumption with respect to such reallocation and adjustment.   Borrower and Administrative Agent hereby consent to such reallocation and adjustment of the  Commitments and each New Lender’s Commitment.  The Administrative Agent hereby waives  the $3,500 processing and recordation fee with respect to the assignments and reallocations of the  Commitments contemplated by this Section 13.22.  To the extent requested by any Lender, and in  accordance with Section 11.1, Borrower shall pay to such Lender, within the time period  prescribed by Section 11.1, any amounts required to be paid by Borrower under Section 11.1 in  the event the payment of any principal of any Eurodollar-based Advance or the conversion of any  Eurodollar-based Advance other than on the last day of an Interest Period applicable thereto is  required in connection with the reallocation contemplated by this Section 13.22.  13.23 Flood Insurance.  Notwithstanding any provision in this Agreement or any other  Loan Document to the contrary, in no event is any Building (as defined in the applicable Flood  Insurance Regulation) or Manufactured (Mobile) Home (as defined in the applicable Flood  Insurance Regulation) included in the definition of “Mortgaged Properties” in the Mortgages and  no Building or Manufactured (Mobile) Home is hereby encumbered by the Collateral Documents.  As used herein, “Flood Insurance Regulations” shall mean (i) the National Flood Insurance Act of  1968 as now or hereafter in effect or any successor statute thereto, (ii) the Flood Disaster Protection  Act of 1973 as now or hereafter in effect or any successor statue thereto, (iii) the National Flood  Insurance Reform Act of 1994 (amending 42 USC 4001, et seq.), as the same may be amended or  recodified from time to time, and (iv) the Flood Insurance Reform Act of 2004 and any regulations  promulgated thereunder.  13.24 Acknowledgment and Consent to Bail-In of Affected Financial Institutions.   Notwithstanding anything to the contrary in any Loan Document or in any other agreement,  arrangement or understanding among any such parties, each party hereto acknowledges that any  liability of any Affected Financial Institution arising under any Loan Document, to the extent such  liability is unsecured, may be subject to the write-down and conversion powers of the applicable  Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by  

 

  84134605.9   MRC Energy Company Credit Agreement 131  (a) the application of any Write-Down and Conversion Powers by the  applicable Resolution Authority to any such liabilities arising hereunder which may be  payable to it by any party hereto that is an Affected Financial Institution; and  (b) the effects of any Bail-in Action on any such liability, including, if  applicable:  (i) a reduction in full or in part or cancellation of any such liability;  (ii) a conversion of all, or a portion of, such liability into shares or other  instruments of ownership in such Affected Financial Institution, its parent  undertaking, or a bridge institution that may be issued to it or otherwise conferred  on it, and that such shares or other instruments of ownership will be accepted by it  in lieu of any rights with respect to any such liability under this Agreement or any  other Loan Document; or  (iii) the variation of the terms of such liability in connection with the  exercise of the write-down and conversion powers of the applicable Resolution  Authority.  13.25 Acknowledgment Regarding Any Supported QFCs.  To the extent that the Loan  Documents provide support, through a guarantee or otherwise, for Commodity Hedging  Agreements or Interest Rate Agreements or any other agreement or instrument that is a QFC (such  support, “QFC Credit Support” and each such QFC a “Supported QFC”), the parties acknowledge  and agree as follows with respect to the resolution power of the Federal Deposit Insurance  Corporation under the Federal Deposit Insurance Act and Title II of the Dodd-Frank Wall Street  Reform and Consumer Protection Act (together with the regulations promulgated thereunder, the  “U.S. Special Resolution Regimes”) in respect of such Supported QFC and QFC Credit Support  (with the provisions below applicable notwithstanding that the Loan Documents and any  Supported QFC may in fact be stated to be governed by the laws of the State of Texas and/or of  the United States or any other state of the United States):  (a) In the event a Covered Entity that is party to a Supported QFC (each, a  “Covered Party”) becomes subject to a proceeding under a U.S. Special Resolution  Regime, the transfer of such Supported QFC and the benefit of such QFC Credit Support  (and any interest and obligation in or under such Supported QFC and such QFC Credit  Support, and any rights in property securing such Supported QFC or such QFC Credit  Support) from such Covered Party will be effective to the same extent as the transfer would  be effective under the U.S. Special Resolution Regime if the Supported QFC and such QFC  Credit Support (and any such interest, obligation and rights in property) were governed by  the laws of the United States or a state of the United States. In the event a Covered Party  or a BHC Act Affiliate of a Covered Party becomes subject to a proceeding under a U.S.  Special Resolution Regime, Default Rights under the Loan Documents that might  otherwise apply to such Supported QFC or any QFC Credit Support that may be exercised  against such Covered Party are permitted to be exercised to no greater extent than such  Default Rights could be exercised under the U.S. Special Resolution Regime if the  Supported QFC and the Loan Documents were governed by the laws of the United States  

 

  84134605.9   MRC Energy Company Credit Agreement 132  or a state of the United States. Without limitation of the foregoing, it is understood and  agreed that rights and remedies of the parties with respect to a Defaulting Lender shall in  no event affect the rights of any Covered Party with respect to a Supported QFC or any  QFC Credit Support.  (b) As used in this Section 13.25, the following terms have the following  meanings:   “BHC Act Affiliate” of a party means an “affiliate” (as such term is defined under,  and interpreted in accordance with, 12 U.S.C. 1841(k)) of such party.   “Covered Entity” means any of the following:    (i) a “covered entity” as that term is defined in, and interpreted in  accordance with, 12 C.F.R. § 252.82(b);    (ii) a “covered bank” as that term is defined in, and interpreted in  accordance with, 12 C.F.R. § 47.3(b); or    (iii) a “covered FSI” as that term is defined in, and interpreted in  accordance with, 12 C.F.R. § 382.2(b).  “Default Right” has the meaning assigned to that term in, and shall be interpreted  in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable.  “QFC” has the meaning assigned to the term “qualified financial contract” in, and  shall be interpreted in accordance with, 12 U.S.C. 5390(c)(8)(D).  13.26 Entire Agreement.  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 LOAN 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.  [Signatures Follow On Succeeding Pages]  

 

    MRC Energy Company Credit Agreement Signature Page  WITNESS the due execution hereof as of the day and year first above written.  MRC ENERGY COMPANY,  as Borrower      By: /s/ David E. Lancaster  Name: David E. Lancaster  Title:   Executive Vice President    

 

    MRC Energy Company Credit Agreement Signature Page  ROYAL BANK OF CANADA,  as Administrative Agent      By: /s/ Helena Sadowski  Name: Helena Sadowski  Title: Manager, Agency      ROYAL BANK OF CANADA,  as a Lender and as an Issuing Lender       By: /s/ Don J. McKinnerny  Name: Don J. McKinnerny  Title: Authorized Signatory  

 

    MRC Energy Company Credit Agreement Signature Page  BANK OF AMERICA, N.A.,  as a Lender      By: /s/ Raza Jafferi   Name: Raza Jafferi  Title: Director  

 

    MRC Energy Company Credit Agreement Signature Page  COMERICA BANK,  as a Lender      By: /s/ Garrett R. Merrell   Name: Gerrett R. Merrell  Title: Senior Vice Presiden    

 

    MRC Energy Company Credit Agreement Signature Page  TRUIST BANK,  as a Lender      By: /s/ Benjamin L. Brown   Name: Benjamin L. Brown  Title: Director  

 

    MRC Energy Company Credit Agreement Signature Page  THE BANK OF NOVA SCOTIA, HOUSTON  BRANCH  as a Lender      By: /s/ Joe Lattanzi   Name: Joe Lattanzi  Title: Managing Director 

 

    MRC Energy Company Credit Agreement Signature Page  IBERIABANK, a division of First Horizon Bank  as a Lender      By: /s/ Bryan Chapman   Name: Bryan Chapman  Title: Market President – Energy Lending 

 

    MRC Energy Company Credit Agreement Signature Page  PNC BANK, NATIONAL ASSOCIATION,  as a Lender      By: /s/ John Engel   Name: John Engel  Title: Senior Vice President 

 

    MRC Energy Company Credit Agreement Signature Page  CATHAY BANK,  as a Lender      By: /s/ Dale T Wilson   Name: Dale T Wilson  Title: Senior Vice President  

 

    MRC Energy Company Credit Agreement Signature Page  KEYBANK NATIONAL ASSOCIATION,  as a Lender      By: /s/ Kyle Gruen   Name: Kyle Gruen  Title: Vice President  

 

    MRC Energy Company Credit Agreement Signature Page  U.S. BANK, NATIONAL ASSOCIATION,  as a Lender      By: /s/ Matthew Turner   Name: Matthew Turner  Title: Vice President  

 

    MRC Energy Company Credit Agreement Signature Page  ZIONS BANCORPORATION, N.A. dba Amegy  Bank,  as a Lender      By: /s/ Jill McSorley   Name: Jill McSorley  Title: Senior Vice President – Amegy Bank  Division    

 

  84134605.9   Schedule 1.1    Applicable Margin Grid  Revolving Credit Facility  (basis points per annum)    Basis for Pricing Level I Level II Level III Level IV Level V  Borrowing Base Utilization*  < 25% ≥ 25% but  < 50%  ≥ 50% but  < 75%  ≥ 75% but  < 90%  ≥ 90% but  < 100%    Revolving Credit Eurodollar Margin 175 200 225 250 275 Revolving Credit Base Rate Margin 75 100 125 150 175 Commitment Fees 37.5 37.5 50 50 50 Letter of Credit Fees (exclusive of  fronting fees) 175 200 225 250 275    * Definitions as set forth in the Credit Agreement.  

 

    Schedule 1.2    Percentages and Allocations  Revolving Credit  LENDERS  REVOLVING  CREDIT  ALLOCATIONS  REVOLVING  CREDIT  PERCENTAGE  Royal Bank of Canada $90,000,000 12.857142857%  Truist Bank $90,000,000 12.857142857%  Bank of America, N.A. $77,000,000 11.000000000%  PNC Bank, National Association $77,000,000 11.000000000%  The Bank of Nova Scotia,  Houston Branch  $77,000,000  11.000000000%  KeyBank National Association $77,000,000 11.000000000%  Comerica Bank $58,500,000 8.357142857%  U.S. Bank National Association $58,500,000 8.357142857%  IBERIABANK $35,000,000 5.000000000%  Zions Bancorporation, N.A., dba  Amegy Bank  $35,000,000  5.000000000%  Cathay Bank $25,000,000 3.571428572%      TOTALS $700,000,000.00 100.000000000%          

 

  84134605.9   EXHIBIT A  FORM OF REQUEST FOR REVOLVING CREDIT ADVANCE    Dated:  ________, 20__    TO:  Royal Bank of Canada, as Administrative Agent    RE: Fourth Amended and Restated Credit Agreement (as amended, restated, amended and  restated, extended, supplemented or otherwise modified in writing from time to time, the  "Credit Agreement") dated as of November 18, 2021, among the Lenders from time to time  party thereto, Royal Bank of Canada, as administrative agent for the Lenders, and MRC  Energy Company, a Texas corporation (the "Borrower").  Pursuant to the Credit Agreement, the Borrower hereby requests an Advance from the  Lenders, as described herein:   Date of Advance:  ____________________     (check if applicable):  This Advance is or includes a whole or partial continuation/conversion of:  [Describe Advance(s)]   Type of Advance (check only one):    Base Rate Advance    Eurodollar-based Advance     Amount of Advance:  $____________________   Interest Period (applicable to Eurodollar-based Advances):  __________ months (insert 1, 3, or 6)   Disbursement Instructions:  ____________________  ____________________     [The Consolidated Cash Balance (without regard to the requested Revolving Credit Advance):  $____________________  

 

  84134605.9    The pro forma Consolidated Cash Balance (giving effect to the requested Revolving Credit  Advance and any other transactions occurring prior to, or substantially simultaneously  with, such Advance):  $____________________]1      Unless otherwise defined herein, terms defined in the Credit Agreement and used herein  shall have the meanings given to them in the Credit Agreement.    The Borrower hereby represents and warrants that the conditions specified in Section 5.2  of the Credit Agreement will be satisfied on and as of the date of the Advance requested hereunder.    MRC ENERGY COMPANY,  as the Borrower        By: ____________________________________  Name: ____________________________________  Title: ____________________________________          1 To be included solely with respect to a Revolving Credit Advance made pursuant to Section 2.1 (but not  conversions/continuations) where the Request for Revolving Credit Advance was not delivered to Administrative  Agent by 12:00 pm (New York time) two (2) Business Days prior to the proposed date of the Revolving Credit  Advance.  

 

  84134605.9   EXHIBIT B  FORM OF REVOLVING CREDIT NOTE                        __________, 20__    FOR VALUE RECEIVED, the undersigned MRC Energy Company, a Texas corporation (the  "Borrower"), hereby unconditionally promises to pay to [_________________] and its registered  assigns (the "Lender"), the principal sum equal to its Revolving Credit Commitment Amount as set  forth in the Credit Agreement (as defined below), or if less, the aggregate unpaid principal amount of  all Advances made by the Lender to Borrower pursuant to the terms of the Credit Agreement, together  with interest on the unpaid principal balance thereof as set forth in the Credit Agreement, both  principal and interest payable as therein provided in lawful money of the United State of America at  the offices of Administrative Agent provided in Section 13.6 of the Credit Agreement, or at such other  place, as from time to time may be designated by Administrative Agent in accordance with the Credit  Agreement.   This Revolving Credit Note (this “Note”) is one of the Notes referred to in the Fourth  Amended and Restated Credit Agreement, dated as of November 18, 2021 (as amended, restated,  amended and restated, extended, supplemented or otherwise modified in writing from time to time,  the "Credit Agreement"), among the Borrower, the lenders from time to time party thereto, and Royal  Bank of Canada, as Administrative Agent. Unless otherwise defined herein, terms defined in the  Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.  This Note is entitled to the benefits of the Credit Agreement and may be prepaid in whole or  in part subject to the terms and conditions provided therein.  This Note is also entitled to the benefits  of the Guaranty and the Collateral Documents.  Upon the occurrence and continuation of one or more  of the Events of Default specified in the Credit Agreement, all amounts then remaining unpaid on this  Note shall become, or may be declared to be, immediately due and payable all as provided in the  Credit Agreement.    The Borrower hereby waives presentment for payment, demand, protest and notice of  dishonor and nonpayment of this Note.  This Note shall be governed by and construed in accordance with the applicable laws of the  United States of America and the laws of the State of Texas.  THIS NOTE, THE CREDIT AGREEMENT AND THE OTHER LOAN DOCUMENTS  REPRESENT THE FINAL AGREEMENTS BETWEEN THE PARTIES AND MAY NOT BE  CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT  ORAL AGREEMENTS OF THE PARTIES.  THERE ARE NO UNWRITTEN ORAL  AGREEMENTS BETWEEN THE PARTIES.  [SIGNATURE FOLLOWS ON SUCCEEDING PAGE] 

 

  84134605.9   MRC ENERGY COMPANY,  as the Borrower      By:         Name:  Title:    

 

  84134605.9   EXHIBIT C  FORM OF ASSIGNMENT AND ASSUMPTION  This Assignment and Assumption (the “Assignment and Assumption”) is dated as of the  Effective Date set forth below and is entered into by and between [the][each]2 Assignor identified  in item 1 below ([the][each, an] “Assignor”) and [the][each]3 Assignee identified in item 2 below  ([the][each, an] “Assignee”).  [It is understood and agreed that the rights and obligations of [the  Assignors][the Assignees]4 hereunder are several and not joint.]5  Capitalized terms used but not  defined herein shall have the meanings given to them in the Credit Agreement identified below (as  amended, restated, amended and restated, extended, supplemented or otherwise modified in writing  from time to time, the “Credit Agreement”), receipt of a copy of which is hereby acknowledged by  [the][each] Assignee.  The Standard Terms and Conditions set forth in Annex 1 attached hereto are  hereby agreed to and incorporated herein by reference and made a part of this Assignment and  Assumption as if set forth herein in full.    For an agreed consideration, [the][each] Assignor hereby irrevocably sells and assigns to  [the Assignee][the respective Assignees], and [the][each] Assignee hereby irrevocably purchases  and assumes from [the Assignor][the respective Assignors], subject to and in accordance with the  Standard Terms and Conditions and the Credit Agreement, as of the Effective Date inserted by the  Administrative Agent as contemplated below (i) all of [the Assignor’s][the respective Assignors’]  rights and obligations in [its capacity as a Lender][their respective capacities as Lenders] under the  Credit Agreement and any other documents or instruments delivered pursuant thereto to the extent  related to the amount and percentage interest identified below of all of such outstanding rights and  obligations of [the Assignor][the respective Assignors] under the respective facilities identified  below (including without limitation any letters of credit, and guarantees included in such facilities),  and (ii) to the extent permitted to be assigned under applicable law, all claims, suits, causes of action  and any other right of [the Assignor (in its capacity as a Lender)][the respective Assignors (in their  respective capacities as Lenders)] against any Person, whether known or unknown, arising under or  in connection with the Credit Agreement, any other documents or instruments delivered pursuant  thereto or the loan transactions governed thereby or in any way based on or related to any of the  foregoing, including, but not limited to, contract claims, tort claims, malpractice claims, statutory  claims and all other claims at law or in equity related to the rights and obligations sold and assigned  pursuant to clause (i) above (the rights and obligations sold and assigned by [the][any] Assignor to  [the][any] Assignee pursuant to clauses (i) and (ii) above being referred to herein collectively as  [the][an] “Assigned Interest”).  Each such sale and assignment is without recourse to [the][any]  Assignor and, except as expressly provided in this Assignment and Assumption, without  representation or warranty by [the][any] Assignor.        1. Assignor[s]:  ______________________________    2. Assignee[s]:  ______________________________      2 For bracketed language here and elsewhere in this form relating to the Assignor(s), if the assignment is from a single Assignor,  choose the first bracketed language.  If the assignment is from multiple Assignors, choose the second bracketed language.  3 For bracketed language here and elsewhere in this form relating to the Assignee(s), if the assignment is to a single Assignee,  choose the first bracketed language.  If the assignment is to multiple Assignees, choose the second bracketed language.  4 Select as appropriate.  5 Include bracketed language if there are either multiple Assignors or multiple Assignees.  

 

  84134605.9       ______________________________   [for each Assignee, indicate Affiliate of [identify Lender]]    3. Borrower:  MRC Energy Company    4. Administrative Agent: Royal Bank of Canada, as the administrative agent under the Credit  Agreement    5. Credit Agreement: Fourth Amended and Restated Credit Agreement dated as of  November 18, 2021 among MRC Energy Company, as borrower, the  Lenders parties thereto, Royal Bank of Canada, as Administrative  Agent.    6.  Assigned Interest[s]:    Assignor[s]6 Assignee[s]7  Aggregate Amount of  Revolving Credit  Aggregate  Commitment/Advances  for all Lenders8  Amount of  Revolving Credit  Aggregate  Commitment/  Advances  Assigned8  Percentage  Assigned of  Revolving Credit  Aggregate  Commitment/  Advances 9    $ $ %    $ $ %    $ $ %           6 List each Assignor, as appropriate.  7 List each Assignee, as appropriate.  8 Amount to be adjusted by the counterparties to take into account any payments or prepayments made between the Trade Date and  the Effective Date.  9 Set forth, to at least 9 decimals.  

 

  84134605.9     Effective Date:   _____________ ___, 20___ [TO BE INSERTED BY ADMINISTRATIVE AGENT  AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE  REGISTER THEREFOR.]    The terms set forth in this Assignment and Assumption are hereby agreed to:    ASSIGNOR[S]  [NAME OF ASSIGNOR]      By:______________________________     Title:    [NAME OF ASSIGNOR]      By:______________________________     Title:    ASSIGNEE[S]  [NAME OF ASSIGNEE]      By:______________________________     Title:      [NAME OF ASSIGNEE]      By:______________________________     Title:                              [Consented to and]10 Accepted:    10 To be added only if the consent of the Administrative Agent is required by the terms of the Credit Agreement.  

 

  84134605.9     [NAME OF ADMINISTRATIVE AGENT], as     Administrative Agent    By: _________________________________    Title:    [Consented to:]11     [NAME OF RELEVANT PARTY]    By: ________________________________    Title:      11 To be added only if the consent of the Borrower and/or other parties (e.g. Issuing Lender) is required by the terms of the Credit  Agreement.    

 

  84134605.9   ANNEX 1    STANDARD TERMS AND CONDITIONS FOR  ASSIGNMENT AND ASSUMPTION    1. Representations and Warranties.       1.1 Assignor[s].  [The][Each] Assignor (a) represents and warrants that (i) it is the legal  and beneficial owner of [the][the relevant] Assigned Interest, (ii) [the][such] Assigned Interest is  free and clear of any lien, encumbrance or other adverse claim, (iii) it has full power and authority,  and has taken all action necessary, to execute and deliver this Assignment and Assumption and to  consummate the transactions contemplated hereby and (iv) it is not a Defaulting Lender; and (b)  assumes no responsibility with respect to (i) any statements, warranties or representations made in  or in connection with the Credit Agreement or any other Loan Document, (ii) the execution,  legality, validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any  collateral thereunder, (iii) the financial condition of the Borrower, any of its Subsidiaries or  Affiliates or any other Person obligated in respect of any Loan Document, or (iv) the performance  or observance by the Borrower, any of its Subsidiaries or Affiliates or any other Person of any of  their respective obligations under any Loan Document.     1.2. Assignee[s].  [The][Each] Assignee (a) represents and warrants that (i) it has full  power and authority, and has taken all action necessary, to execute and deliver this Assignment  and Assumption and to consummate the transactions contemplated hereby and to become a Lender  under the Credit Agreement, (ii) it meets all the requirements to be an assignee under Section  13.7(b)(iii), (v) and (vi) of the Credit Agreement (subject to such consents, if any, as may be  required under Section 13.7(b)(iii) or (v) of the Credit Agreement), (iii) from and after the  Effective Date, it shall be bound by the provisions of the Credit Agreement as a Lender thereunder  and, to the extent of [the][the relevant] Assigned Interest, shall have the obligations of a Lender  thereunder, (iv) it is sophisticated with respect to decisions to acquire assets of the type represented  by the Assigned Interest and either it, or the Person exercising discretion in making its decision to  acquire the Assigned Interest, is experienced in acquiring assets of such type, (v) it has received a  copy of the Credit Agreement, and has received or has been accorded the opportunity to receive  copies of the most recent financial statements delivered pursuant to Section 7.1 thereof, as  applicable, and such other documents and information as it deems appropriate to make its own  credit analysis and decision to enter into this Assignment and Assumption and to purchase  [the][such] Assigned Interest, (vi) it has, independently and without reliance upon the  Administrative Agent or any other Lender and based on such documents and information as it has  deemed appropriate, made its own credit analysis and decision to enter into this Assignment and  Assumption and to purchase [the][such] Assigned Interest, and (vii) if it is a Foreign Lender  attached to the Assignment and Assumption is any documentation required to be delivered by it  pursuant to the terms of the Credit Agreement, duly completed and executed by [the][such]  Assignee; and (b) agrees that (i) it will, independently and without reliance on the Administrative  Agent, [the][any] Assignor or any other Lender, and based on such documents and information as  it shall deem appropriate at the time, continue to make its own credit decisions in taking or not  taking action under the Loan Documents, and (ii) it will perform in accordance with their terms all  

 

  84134605.9     of the obligations which by the terms of the Loan Documents are required to be performed by it  as a Lender.     2. Payments.  From and after the Effective Date, the Administrative Agent shall make  all payments in respect of [the][each] Assigned Interest (including payments of principal, interest,  fees and other amounts) to [the][the relevant] Assignor for amounts which have accrued to but  excluding the Effective Date and to [the][the relevant] Assignee for amounts which have accrued  from and after the Effective Date.  Notwithstanding the foregoing, the Administrative Agent shall  make all payments of interest, fees or other amounts paid or payable in kind from and after the  Effective Date to [the][the relevant] Assignee.     3. General Provisions.  This Assignment and Assumption shall be binding upon, and  inure to the benefit of, the parties hereto and their respective successors and assigns.  This  Assignment and Assumption may be executed in any number of counterparts, which together shall  constitute one instrument.  Delivery of an executed counterpart of a signature page of this  Assignment and Assumption by telecopy shall be effective as delivery of a manually executed  counterpart of this Assignment and Assumption.  This Assignment and Assumption shall be  governed by, and construed in accordance with, the law of the State of Texas.  

 

  84134605.9   EXHIBIT D  FORM OF GUARANTY    See attached. 

 

  84134605.9   EXHIBIT E  FORM OF COMPLIANCE CERTIFICATE  Financial Statement Date:____________  To: Royal Bank of Canada, as Administrative Agent  Ladies and Gentlemen:  Reference is made to that certain Fourth Amended and Restated Credit Agreement, dated  as of November 18, 2021 (as amended, restated, amended and restated, extended, supplemented  or otherwise modified in writing from time to time, the “Credit Agreement;” the terms defined  therein being used herein as therein defined), among MRC Energy Company (the “Borrower”),  the Lenders from time to time party thereto, and Royal Bank of Canada, as Administrative Agent  (the “Administrative Agent”).  The undersigned Responsible Officer hereby certifies as of the date hereof that he/she is  the      of the Borrower, and that, as such, he/she is authorized to execute  and deliver this Compliance Certificate (this “Certificate”) to the Administrative Agent on the  behalf of the Borrower, and that:  [Use following paragraph 1 for fiscal year-end financial statements]  1. Attached hereto as Schedule 1 are the year-end audited Consolidated financial  statements of Parent and its Subsidiaries required by Section 7.1(a) of the Credit Agreement for  the Fiscal Year ended as of the above date certified by an independent, nationally recognized  certified public accounting firm required by such section.  [Use following paragraph 1 for fiscal quarter-end financial statements]  1. Attached hereto as Schedule 1 are the unaudited Consolidated financial statements  of Parent and its Subsidiaries required by Section 7.1(b) of the Credit Agreement for the Fiscal  Quarter ended as of the above date.  Such financial statements fairly present the consolidated financial condition and results of  operations of the Parent and its Subsidiaries in accordance with GAAP (except as disclosed on  Annex 1 hereto) throughout the periods reflected therein and with prior periods, provided that  financial statements delivered pursuant to Section 7.1(b) are not required to include footnotes and  will be subject to change for audit and year-end adjustments, including tests for impairment of  assets.  [select one:]  [to the best knowledge of the undersigned during such fiscal period, no Default has  occurred and is continuing.]  

 

  84134605.9     [The following is a list of the existing Defaults and their nature and status:]  2. [Except as described below,]1 The representations and warranties of the Borrower  contained in Article 6 of the Credit Agreement or in any other Loan Document are true and correct  in all material respects on and as of the date hereof, except to the extent that such representations  and warranties specifically refer to an earlier date, in which case they shall be true and correct in  all material respects as of such earlier date, and except that for purposes of this Certificate, the  representations and warranties contained in Section 6.17 of the Credit Agreement shall be deemed  to refer to the most recent statements furnished pursuant to Section 7.1(a) and Section 7.1(b) of  the Credit Agreement, including the statements in connection with which this Certificate is  delivered.  3. The financial covenant analyses and information set forth on Schedule 2 attached  hereto are true and accurate on and as of the date of this Certificate.  IN WITNESS WHEREOF, the undersigned has executed this Certificate as of  ___________________________, ______.  MRC ENERGY COMPANY    By:   Name:  Title:    1 NTD: Language to be included if Matador is unable to make a representation or warranty on the date it is required  to deliver a compliance certificate.  

 

  84134605.9     SCHEDULE 1    See attached. 

 

  84134605.9   ANNEX 1    The attached financial statements are in accordance with GAAP, except: [_________]  

 

  84134605.9     For the Quarter/Year ended _________________ (“Statement Date”)  SCHEDULE 2  TO THE COMPLIANCE CERTIFICATE  ($ IN 000’S)  1. Total Debt to Consolidated EBITDA Ratio  (Section 7.9(a))     (A) The amount equal to (i) total Debt of Parent and its  Subsidiaries (other than Unrestricted Subsidiaries)  determined on a consolidated basis in accordance with  GAAP minus (ii) unrestricted cash and cash equivalents of   the Parent and its Subsidiaries (other than Unrestricted  Subsidiaries) as of the last day of such Test Period; provided  that the aggregate amount of cash and cash equivalents shall  not exceed $75,000,000 for purposes of this clause (ii):     (1) All obligations of such Person for borrowed money  or evidenced by bonds, debentures, notes or other  similar instruments (including principal, but  excluding interest, fees and charges):     $       (2) All obligations of such Person (whether contingent or  otherwise) in respect of bankers’ acceptances, letters  of credit, surety or other bonds and similar  instruments:      $       (3) All obligations of such Person to pay the deferred  purchase price of property or services (other than for  borrowed money and other than accounts payable (for  the deferred purchase price of property or services)  from time to time incurred in the ordinary course of  business which, if greater than ninety (90) days past  the invoice or billing date, are being contested in good  faith by appropriate proceedings and for which  reserves adequate under GAAP shall have been  established therefor):                 $       (4) All obligations under leases which shall have been, or  should have been, in accordance with GAAP,  recorded as capital leases in respect of which such  Person is liable (whether contingent or otherwise  including principal but excluding interest, fees and  charges):          $       (5) All obligations under operating leases which require  such Person or its Affiliate to make payments over the  term of such lease, including payments at  termination, based on the purchase price or appraisal  value of the Property subject to such lease plus a            

 

  84134605.9     marginal interest rate, and used primarily as a  financing vehicle for, or to monetize, such Property: $       (6) All Debt (as described in the other clauses of this  certificate) of others secured by a Lien on any asset  of such Person, whether or not such Debt is assumed  by such Person, but valued at the lesser of (x) the  amount of such Debt and (y) the fair market value of  the property securing such Debt:         $       (7) All Debt (as described in the other clauses of this  certificate) and other obligations of others guaranteed  by such Person or in which such Person otherwise  assures a creditor against loss of the debtor or  obligations of others:       $       (8) All obligations or undertakings of such Person to  maintain or cause to be maintained the financial  position or covenants of others or to purchase the  Debt of others:      $       (9) Obligations to deliver or sell Hydrocarbons in  consideration of advance payments, as disclosed by  Section 7.15(c) of the Credit Agreement:   $       (10) Any Disqualified Equity Interests:   $     (11) The undischarged balance of any production payment  created by such Person or for the creation of which  such Person directly or indirectly received payment:     $     (12) Total of Lines A.2 + A.3 + A.4 + A.5 + A.6 + A.7 +  A.8 + A.9 + A.10 + A.11, minus $1,000,000, but not  less than zero:    $       (13) Total Debt of Parent and its Subsidiaries (other than  Unrestricted Subsidiaries) (Lines A.1 + A.12): $       (14) Unrestricted cash and cash equivalents of the Parent  and its Subsidiaries (other than Unrestricted  Subsidiaries) as of the last day of such Test Period1: $       (15) The net amount of Total Debt of Parent and its  Subsidiaries (other than Unrestricted Subsidiaries)  (Lines A.13 - A.14): $      (B) Consolidated EBITDA of the Parent and its Subsidiaries  (other than Unrestricted Subsidiaries) for such Test Period     (1) Consolidated Net Income (the consolidated net  income (or loss) of Parent and its Subsidiaries,      $     1 Provided that the aggregate amount of cash and cash equivalents shall not exceed $75,000,000  

 

  84134605.9     determined on a consolidated basis in accordance  with GAAP1):    (2) Interest, taxes, depreciation, depletion, amortization,  and accretion of asset retirement obligations (to the  extent such expenses or charges have been deducted  from Consolidated Net Income for the applicable  period):        $       (3) Any non-cash revenue or expense associated with  hedging contracts resulting from ASC Topic 815 and  any non-cash income, gain, loss or expense arising  from the issuance of stock options or restricted stock,  to the extent such items are included in Consolidated  Net Income:          $       (4) Any other non-cash charges (excluding accruals for  cash expenses made in the ordinary course of  business) or non-cash gains:   $       (5) Consolidated EBITDA (Line B.1 + Line B.2 and + or  - Line B.3 (as appropriate) and + or -  Line B.4 (as  appropriate)):  $         (C) Total Debt to Consolidated EBITDA Ratio (Line A.15 /  Line B.5)     (D) Required ratio for compliance: Less than or equal to  3.50 to 1.00  (E) Compliance: Yes/No  2. Current Ratio (Section 7.9(b)).    (A) Consolidated Current Assets of Parent and its Subsidiaries  determined in accordance with GAAP:     (1) The total consolidated current assets of Parent and its  Subsidiaries, determined in accordance with GAAP  (except as provided with respect to ASC Topic 815),  at the time of any determination thereof, which shall  not include any non-cash items resulting from the  application of ASC Topic 815 or the fair value of any  Commodity Hedging Agreement or any non-hedge  $       1Provided that there shall be excluded from such net income (to the extent otherwise included therein) the following:  (a) the net income of (i) any Unrestricted Subsidiary and (ii) any Person in which Parent or any of its Subsidiaries  has an interest which interest does not cause the net income of such other Person to be consolidated with the net  income of Parent and its Subsidiaries in accordance with GAAP, in each case, except to the extent of the amount of  dividends or distributions actually paid in cash in such period by such Unrestricted Subsidiary or such other Person  to Parent or to any of its Subsidiaries (other than an Unrestricted Subsidiary), as the case may be; (b) any  extraordinary gains or losses, including gains or losses attributable to property sales not in the ordinary course of  business; and (c) the cumulative effect of a change in accounting principles and any gains or losses attributable to  writeups or write downs of assets or any full cost ceiling impairment.  

 

  84134605.9     derivative contract (whether deemed effective or non- effective):    (2) The excess, if any, of (a) the lesser of (i) the  Maximum Facility Amount or (ii) the Borrowing  Base minus (b) the Aggregate Credit Exposure then  outstanding:  $       (3) Consolidated Current Assets (Line A.1 + Line A.2): $      (B) Consolidated Current Liabilities of Parent and its  Subsidiaries determined in accordance with GAAP:     (1) The total consolidated current liabilities of Parent and  its Subsidiaries, determined in accordance with  GAAP (except as provided herein with respect to  ASC Topic 815), at the time of any determination  thereof, less current maturities under the Credit  Agreement at such time, which shall not include any  non-cash items resulting from the requirements of  ASC Topic 815 or the fair value of any Commodity  Hedging Agreement or any non-hedge derivative  contract (whether deemed effective or non-effective),  or any liability resulting from the accounting for stock  option expense: $       (2) Total Consolidated Current Liabilities (Line B.1): $      (C) Current Ratio (Line A.3 / Line B.2): _____: 1.00   (D) Required ratio for compliance: Greater than or equal to  1.00 to 1.00  (E) Compliance: Yes/No      

 

  84134605.9   EXHIBIT F  FORM OF NOTICE OF REQUEST FOR LETTER OF CREDIT    Dated:  ________, 20__    TO:  Royal Bank of Canada, as Administrative Agent    RE: Fourth Amended and Restated Credit Agreement (as amended, restated, amended and  restated, extended, supplemented or otherwise modified in writing from time to time, the  "Credit Agreement") dated as of November 18, 2021, among the Lenders from time to time  party thereto, Royal Bank of Canada, as administrative agent for the Lenders, and MRC  Energy Company, a Texas corporation (the "Borrower").  Pursuant to the Credit Agreement, the Borrower has requested a Letter of Credit from an  Issuing Lender, as described herein:   Date of Issuance:  ____________________   Stated Amount:  _____________________   Name and Address of Beneficiary: ___________________   Expiration Date: _______________________  Unless otherwise defined herein, terms defined in the Credit Agreement and used herein  shall have the meanings given to them in the Credit Agreement.    [Signature Page Follows]  

 

  84134605.9   The Borrower hereby represents and warrants that the conditions specified in Section 5.2  of the Credit Agreement will be satisfied on and as of the date of issuance of the Letter of Credit  described herein.    MRC ENERGY COMPANY,  as the Borrower        By: ____________________________________  Name: ____________________________________  Title: ____________________________________    

 

  84134605.9   EXHIBIT G  FORM OF NOTICE OF PREPAYMENT    Dated:  ________, 20__    TO:  Royal Bank of Canada, as Administrative Agent    RE: Fourth Amended and Restated Credit Agreement (as amended, restated, amended and  restated, extended, supplemented or otherwise modified in writing from time to time, the  "Credit Agreement") dated as of November 18, 2021, among the Lenders from time to time  party thereto, Royal Bank of Canada, as administrative agent for the Lenders, and MRC  Energy Company, a Texas corporation (the "Borrower").     This Notice of Prepayment is delivered to you pursuant to Section 2.7 of the Credit  Agreement.  Capitalized terms used herein and not defined herein shall have the meanings assigned  thereto in the Credit Agreement.  1. The Borrower hereby provides notice to the Administrative Agent that it shall repay  the following [Base Rate Advances] [Eurodollar-based Advances]: _______________. (Complete  with an amount in accordance with Section 2.7(b) of the Credit Agreement.)  3. The Borrower shall repay the above-referenced Advances on the following Business Day:  _______________.  (Complete with a date no earlier than (i) one Business Day subsequent to the date of this Notice  of Prepayment with respect to any Base Rate Advance and (ii) three (3) Business Days subsequent to date of this  Notice of Prepayment with respect to any Eurodollar-based Advances.)   [Signature Page Follows]  

 

  84134605.9   IN WITNESS WHEREOF, the undersigned has executed this Notice of Prepayment as of the day  and year first written above.    MRC ENERGY COMPANY,  as the Borrower        By: ____________________________________  Name: ____________________________________  Title: ____________________________________      

 

  84134605.9   EXHIBIT H-1  U.S. TAX COMPLIANCE CERTIFICATE    (For Foreign Lenders That Are Not Partnerships For U.S. Federal Income Tax Purposes)  Reference is hereby made to the Fourth Amended and Restated Credit Agreement (as  amended, restated, amended and restated, extended, supplemented or otherwise modified in  writing from time to time, the “Credit Agreement”) is dated as of November 18, 2021, by and  among the Lenders from time to time party thereto, Royal Bank of Canada, as administrative agent  for the Lenders (in such capacity, the “Administrative Agent”), and MRC Energy Company, a  Texas corporation (“Borrower”).  Capitalized terms used herein and not defined herein shall have  the meanings assigned thereto in the Credit Agreement.  Pursuant to the provisions of Section 11.9 of the Credit Agreement, the undersigned hereby  certifies that (a) it is the sole record and beneficial owner of the Advance(s) (as well as any Note(s)  evidencing such Advance(s)) in respect of which it is providing this certificate, (b) it is not a bank  within the meaning of Section 881(c)(3)(A) of the Code, (c) it is not a ten percent (10%)  shareholder of Borrower within the meaning of Section 871(h)(3)(B) of the Code and (d) it is not  a controlled foreign corporation related to Borrower as described in Section 881(c)(3)(C) of the  Code.  The undersigned has furnished the Administrative Agent and Borrower with a certificate  of its non-U.S. Person status on IRS Form W-8BEN.  By executing this certificate, the undersigned  agrees that (a) if the information provided on this certificate changes, the undersigned shall  promptly so inform Borrower and the Administrative Agent and (b) the undersigned shall have at  all times furnished Borrower and the Administrative Agent with a properly completed and  currently effective certificate in either the calendar year in which each payment is to be made to  the undersigned, or in either of the two (2) calendar years preceding such payments.  [NAME OF LENDER]  By:   Name:     Title:    Date: ________ __, 20__  

 

  84134605.9   EXHIBIT H-2  U.S. TAX COMPLIANCE CERTIFICATE    (For Foreign Participants That Are Not Partnerships For U.S. Federal Income Tax Purposes)  Reference is hereby made to the Fourth Amended and Restated Credit Agreement (as  amended, restated, amended and restated, extended, supplemented or otherwise modified in  writing from time to time, the “Credit Agreement”) is dated as of November 18, 2021, by and  among the Lenders from time to time party thereto, Royal Bank of Canada, as administrative agent  for the Lenders (in such capacity, the “Administrative Agent”), and MRC Energy Company, a  Texas corporation (“Borrower”).  Capitalized terms used herein and not defined herein shall have  the meanings assigned thereto in the Credit Agreement.  Pursuant to the provisions of Section 11.9 of the Credit Agreement, the undersigned hereby  certifies that (a) it is the sole record and beneficial owner of the participation in respect of which  it is providing this certificate, (b) it is not a bank within the meaning of Section 881(c)(3)(A) of  the Code, (c) it is not a ten percent (10%) shareholder of Borrower within the meaning of Section  871(h)(3)(B) of the Code and (d) it is not a controlled foreign corporation related to Borrower as  described in Section 881(c)(3)(C) of the Code.  The undersigned has furnished its participating Lender with a certificate of its non-U.S.  Person status on IRS Form W-8BEN.  By executing this certificate, the undersigned agrees that  (a) if the information provided on this certificate changes, the undersigned shall promptly so  inform such Lender in writing and (b) the undersigned shall have at all times furnished such Lender  with a properly completed and currently effective certificate in either the calendar year in which  each payment is to be made to the undersigned, or in either of the two (2) calendar years preceding  such payments.  [NAME OF PARTICIPANT]  By:   Name:     Title:    Date: ________ __, 20__  

 

  84134605.9   EXHIBIT H-3  U.S. TAX COMPLIANCE CERTIFICATE    (For Foreign Participants That Are Partnerships For U.S. Federal Income Tax Purposes)  Reference is hereby made to the Fourth Amended and Restated Credit Agreement (as  amended, restated, amended and restated, extended, supplemented or otherwise modified in  writing from time to time, the “Credit Agreement”) is dated as of November 18, 2021, by and  among the Lenders from time to time party thereto, Royal Bank of Canada, as administrative agent  for the Lenders (in such capacity, the “Administrative Agent”), and MRC Energy Company, a  Texas corporation (“Borrower”).  Capitalized terms used herein and not defined herein shall have  the meanings assigned thereto in the Credit Agreement.  Pursuant to the provisions of Section 11.9 of the Credit Agreement, the undersigned hereby  certifies that (a) it is the sole record owner of the participation in respect of which it is providing  this certificate, (b) its direct or indirect partners/members are the sole beneficial owners of such  participation, (c) with respect such participation, neither the undersigned nor any of its direct or  indirect partners/members is a bank extending credit pursuant to a loan agreement entered into in  the ordinary course of its trade or business within the meaning of Section 881(c)(3)(A) of the Code,  (d) none of its direct or indirect partners/members is a ten percent (10%) shareholder of Borrower  within the meaning of Section 871(h)(3)(B) of the Code and (e) none of its direct or indirect  partners/members is a controlled foreign corporation related to Borrower as described in Section  881(c)(3)(C) of the Code.  The undersigned has furnished its participating Lender with IRS Form W-8IMY  accompanied by one of the following forms from each of its partners/members that is claiming the  portfolio interest exemption: (a) an IRS Form W-8BEN or (b) an IRS Form W-8IMY accompanied  by an IRS Form W-8BEN from each of such partner’s/member’s beneficial owners that is claiming  the portfolio interest exemption.  By executing this certificate, the undersigned agrees that (i) if  the information provided on this certificate changes, the undersigned shall promptly so inform  such Lender and (ii) the undersigned shall have at all times furnished such Lender with a properly  completed and currently effective certificate in either the calendar year in which each payment is  to be made to the undersigned, or in either of the two (2) calendar years preceding such payments.  [NAME OF PARTICIPANT]  By:   Name:     Title:    Date: ________ __, 20__  

 

  84134605.9   EXHIBIT H-4  U.S. TAX COMPLIANCE CERTIFICATE    (For Foreign Lenders That Are Partnerships For U.S. Federal Income Tax Purposes)  Reference is hereby made to the Fourth Amended and Restated Credit Agreement (as  amended, restated, amended and restated, extended, supplemented or otherwise modified in  writing from time to time, the “Credit Agreement”) is dated as of November 18, 2021, by and  among the Lenders from time to time party thereto, Royal Bank of Canada, as administrative agent  for the Lenders (in such capacity, the “Administrative Agent”), and MRC Energy Company, a  Texas corporation (“Borrower”).  Capitalized terms used herein and not defined herein shall have  the meanings assigned thereto in the Credit Agreement.  Pursuant to the provisions of Section 11.9 of the Credit Agreement, the undersigned hereby  certifies that (a) it is the sole record owner of the Advance(s) (as well as any Note(s) evidencing  such Advance(s)) in respect of which it is providing this certificate, (b) its direct or indirect  partners/members are the sole beneficial owners of such Advance(s) (as well as any Note(s)  evidencing such Advance(s)), (c) with respect to the extension of credit pursuant to this Credit  Agreement or any other Loan Document, neither the undersigned nor any of its direct or indirect  partners/members is a bank extending credit pursuant to a loan agreement entered into in the  ordinary course of its trade or business within the meaning of Section 881(c)(3)(A) of the Code,  (d) none of its direct or indirect partners/members is a ten percent (10%) shareholder of Borrower  within the meaning of Section 871(h)(3)(B) of the Code and (e) none of its direct or indirect  partners/members is a controlled foreign corporation related to Borrower as described in Section  881(c)(3)(C) of the Code.  The undersigned has furnished the Administrative Agent and Borrower with IRS Form W- 8IMY accompanied by one of the following forms from each of its partners/members that is  claiming the portfolio interest exemption: (a) an IRS Form W-8BEN or (b) an IRS Form W-8IMY  accompanied by an IRS Form W-8BEN from each of such partner’s/member’s beneficial owners  that is claiming the portfolio interest exemption.  By executing this certificate, the undersigned  agrees that (i) if the information provided on this certificate changes, the undersigned shall  promptly so inform the Borrower and the Administrative Agent and (ii) the undersigned shall have  at all times furnished the Borrower and the Administrative Agent with a properly completed and  currently effective certificate in either the calendar year in which each payment is to be made to  the undersigned, or in either of the two (2) calendar years preceding such payments.  [NAME OF LENDER]  By:   Name:     Title:    Date: ________ __, 20__  

 

  84134605.9   EXHIBIT I  FORM OF CONSOLIDATED CASH BALANCE CERTIFICATE    Reference is made to that certain Fourth Amended and Restated Credit Agreement dated  as of November 18, 2021 (as amended, restated, amended and restated, extended, supplemented  or otherwise modified in writing from time to time the “Credit Agreement”) among the Lenders  from time to time party thereto, Royal Bank of Canada, as administrative agent for the Lenders (in  such capacity, the “Administrative Agent”), and MRC Energy Company, a Texas corporation  (“Borrower”).  Each capitalized term used herein has the same meaning given to it in the Credit  Agreement unless otherwise specified. The undersigned Responsible Officer of the Borrower  hereby certifies on behalf of the Borrower (and not individually) as follows:  (a) The Consolidated Cash Balance as of the date hereof is $_______________.  (b) Attached hereto are summary and balance statements for each deposit account,  securities account, commodity account or other account maintained at any financial institution  other than Administrative Agent in which any Consolidated Cash Balance is held, credited or  carried as of the date hereof.  (c) To the extent the calculation of Consolidated Cash Balance set forth in clause (a)  above excludes any amounts permitted to be excluded therefrom pursuant to the definition of  “Consolidated Cash Balance” set forth in the Credit Agreement, attached hereto are summary and  balance statements and/or other supporting documentation with respect to such exclusions.  The undersigned is the [ ] of the Borrower, and as such he/she is authorized to execute this  certificate on behalf of the Borrower.  EXECUTED AND DELIVERED this [ ] day of [ ].  MRC ENERGY COMPANY      By: ______________________________  Name:    Title:Exhibit 4.1

 

HONDA
AUTO RECEIVABLES 2021-4 OWNER TRUST,

as Issuer,

 

and

 

U.S. BANK NATIONAL ASSOCIATION

as Indenture Trustee

 

 

 

INDENTURE

 

Dated November 24, 2021

 

 

 

     

     

    

 

CROSS REFERENCE TABLE*

 

	TIA Section	Indenture Section
	 	 	 
	310	(a)(1)	6.11
	 	(a)(2)	6.11
	 	(a)(3)	6.10; 6.11
	 	(a)(4)	N.A.**
	 	(a)(5)	6.11
	 	(b)	6.08; 6.11
	 	(c)	N.A.**
	311	(a)	6.12
	 	(b)	6.12
	 	(c)	N.A.
	312	(a)	7.01
	 	(b)	7.02
	 	(c)	7.02
	313	(a)	7.04
	 	(b)(1)	7.04
	 	(b)(2)	7.04
	 	(c)	7.04; 11.05
	 	(d)	7.04
	314	(a)	7.03
	 	(b)	11.15
	 	(c)(1)	11.01
	 	(c)(2)	11.01
	 	(c)(3)	11.01
	 	(d)	11.01
	 	(e)	11.01
	 	(f)	11.01
	315	(a)	6.01
	 	(b)	6.05; 11.01
	 	(c)	6.01
	 	(d)	6.01
	 	(e)	5.13
	316	(a)	1.01
	 	(a)(1)(A)	5.11
	 	(a)(1)(B)	5.12
	 	(a)(2)	N.A.
	 	(b)	5.07
	 	(c)	N.A.
	317	(a)(1)	5.03
	 	(a)(2)	5.03
	 	(b)	3.03
	318	(a)	11.07

 

 

		*	This Cross Reference Table shall not, for any purpose, be deemed
to be part of this Indenture.

		**	N.A. means Not Applicable.

 

    i

     

    

 

Table
of Contents

 

	 	 	 	Page
	 	 	 	 
	ARTICLE I	DEFINITIONS AND INCORPORATION BY REFERENCE	2
	 	 	 	 
	Section 1.01.	Definitions	2
	Section 1.02.	Incorporation by Reference of Trust Indenture Act	2
	 	 	 	 
	ARTICLE II	THE NOTES	2
	 	 	 	 
	Section 2.01.	Form	2
	Section 2.02.	Execution, Authentication and Delivery	3
	Section 2.03.	Temporary Notes	3
	Section 2.04.	Note Register, Registration of Transfer and Exchange	4
	Section 2.05.	Mutilated, Destroyed, Lost or Stolen Notes	7
	Section 2.06.	Persons Deemed Owner	8
	Section 2.07.	Payment of Principal and Interest, Defaulted Interest	8
	Section 2.08.	Cancellation	9
	Section 2.09.	Book-Entry Notes	9
	Section 2.10.	Notices to Clearing Agency	10
	Section 2.11.	Definitive Notes	10
	Section 2.12.	Release of Collateral	11
	Section 2.13.	Tax Treatment; Tax Information	11
	Section 2.14.	Employee Benefit Plans	12
	 	 	 	 
	ARTICLE III	COVENANTS	12
	 	 	 	 
	Section 3.01.	Payment of Principal and Interest	12
	Section 3.02.	Maintenance of Office or Agency	12
	Section 3.03.	Money for Payments to be Held in Trust	12
	Section 3.04.	Existence	14
	Section 3.05.	Protection of Owner Trust Estate	14
	Section 3.06.	Opinions as to Owner Trust Estate	15
	Section 3.07.	Performance of Obligations; Servicing of Receivables	15
	Section 3.08.	Negative Covenants	17
	Section 3.09.	Annual Statement as to Compliance	17
	Section 3.10.	Issuer May Consolidate, etc., Only on Certain Terms	18
	Section 3.11.	Successor or Transferee	19
	Section 3.12.	No Other Business	20
	Section 3.13.	No Borrowing	20

 

    -i-

     

    

 

	Section 3.14.	Servicer’s Obligations	20
	Section 3.15.	Guarantees, Loans, Advances and Other Liabilities	20
	Section 3.16.	Capital Expenditures	20
	Section 3.17.	Removal of Administrator	20
	Section 3.18.	Restricted Payments	20
	Section 3.19.	Notice of Events of Default	21
	Section 3.20.	Further Instruments and Acts	21
	Section 3.21.	Compliance with Laws	21
	 	 	 	 
	ARTICLE IV	SATISFACTION AND DISCHARGE	21
	 	 	 	 
	Section 4.01.	Satisfaction and Discharge of Indenture	21
	Section 4.02.	Application of Trust Money	22
	Section 4.03.	Repayment of Monies Held by Paying Agent	22
	 	 	 	 
	ARTICLE V	REMEDIES	23
	 	 	 	 
	Section 5.01.	Events of Default	23
	Section 5.02.	Acceleration of Maturity, Rescission and Annulment	24
	Section 5.03.	Collection of Indebtedness and Suits for Enforcement by Indenture Trustee	25
	Section 5.04.	Remedies, Priorities	27
	Section 5.05.	Optional Preservation of the Receivables	28
	Section 5.06.	Limitation of Suits	29
	Section 5.07.	Unconditional Rights of Noteholders to Receive Principal and Interest	29
	Section 5.08.	Restoration of Rights and Remedies	29
	Section 5.09.	Rights and Remedies Cumulative	30
	Section 5.10.	Delay or Omission Not a Waiver	30
	Section 5.11.	Control by Noteholders	30
	Section 5.12.	Waiver of Past Defaults	31
	Section 5.13.	Undertaking for Costs	31
	Section 5.14.	Waiver of Stay or Extension Laws	31
	Section 5.15.	Action on Notes	31
	Section 5.16.	Performance and Enforcement of Certain Obligations	32
	 	 	 	 
	ARTICLE VI	THE INDENTURE TRUSTEE	32
	 	 	 	 
	Section 6.01.	Duties of Indenture Trustee	32
	Section 6.02.	Rights of Indenture Trustee	34
	Section 6.03.	Individual Rights of Indenture Trustee	35

 

    -ii-

     

    

 

	Section 6.04.	Indenture Trustee’s Disclaimer	36
	Section 6.05.	Notice of Defaults	36
	Section 6.06.	Reports by Indenture Trustee to Noteholders	36
	Section 6.07.	Compensation and Indemnity	36
	Section 6.08.	Replacement of Indenture Trustee	37
	Section 6.09.	Successor Indenture Trustee by Merger	38
	Section 6.10.	Appointment of Co-Trustee or Separate Trustee	39
	Section 6.11.	Eligibility, Disqualification	40
	Section 6.12.	Preferential Collection of Claims Against Issuer	40
	Section 6.13.	Representations and Warranties of Indenture Trustee	41
	 	 	 	 
	ARTICLE VII	NOTEHOLDERS’ LISTS AND REPORTS	41
	 	 	 	 
	Section 7.01.	Issuer to Furnish Indenture Trustee Names and Addresses of Noteholders	41
	Section 7.02.	Preservation of Information; Communications, Reports and Certain Documents to Noteholders	42
	Section 7.03.	Reports by Issuer	43
	Section 7.04.	Reports by Indenture Trustee	44
	Section 7.05.	Noteholder and Note Owner Demand for Asset Representations Review	44
	Section 7.06.	Voting of Notes Held by Honda Parties	44
	 	 	 	 
	ARTICLE VIII	ACCOUNTS, DISBURSEMENTS AND RELEASES	45
	 	 	 	 
	Section 8.01.	Collection of Money	45
	Section 8.02.	Accounts	45
	Section 8.03.	General Provisions Regarding Accounts	48
	Section 8.04.	Release of Owner Trust Estate	49
	Section 8.05.	Opinion of Counsel	49
	 	 	 	 
	ARTICLE IX	SUPPLEMENTAL INDENTURES	50
	 	 	 	 
	Section 9.01.	Supplemental Indentures Without Consent of Noteholders	50
	Section 9.02.	Supplemental Indentures With Consent of Noteholders	51
	Section 9.03.	Execution of Supplemental Indentures	52
	Section 9.04.	Effect of Supplemental Indenture	52
	Section 9.05.	Conformity with Trust Indenture Act	53
	Section 9.06.	Reference in Notes to Supplemental Indentures	53
	 	 	 	 
	ARTICLE X	REDEMPTION OF NOTES	53
	 	 	 	 
	Section 10.01.	Redemption	53

 

    -iii-

     

    

 

	Section 10.02.	Form of Redemption Notice	53
	Section 10.03.	Notes Payable on Redemption Date	54
	 	 	 	 
	ARTICLE XI	MISCELLANEOUS	54
	 	 	 	 
	Section 11.01.	Compliance Certificates and Opinions, etc	54
	Section 11.02.	Form of Documents Delivered to Indenture Trustee	56
	Section 11.03.	Acts of Noteholders	57
	Section 11.04.	Notices, etc., to Indenture Trustee, Issuer and Rating Agencies	57
	Section 11.05.	Notices to Noteholders; Waiver	58
	Section 11.06.	Alternate Payment and Notice Provisions	58
	Section 11.07.	Conflict with Trust Indenture Act	59
	Section 11.08.	Effect of Headings and Table of Contents	59
	Section 11.09.	Successors and Assigns	59
	Section 11.10.	Separability	59
	Section 11.11.	Benefits of Indenture	59
	Section 11.12.	Legal Holidays	59
	Section 11.13.	Governing Law; Submission to Jurisdiction; Waiver of Jury Trial	59
	Section 11.14.	Counterparts; Electronic Transmission	60
	Section 11.15.	Recording of Indenture	61
	Section 11.16.	Trust Obligation	61
	Section 11.17.	No Petition	61
	Section 11.18.	Inspection	61
	Section 11.19.	[Reserved]	62
	Section 11.20.	Disclosure of Tax Treatment	62
	Section 11.21.	Intent of the Parties; Reasonableness	62
	Section 11.22.	Owner Trustee	63
	Section 11.23.	U.S.A. Patriot Act	63
	Section 11.24.	Communications with Rating Agencies	63

 

    -iv-

     

    

 

	SCHEDULES	 
	 	 
	Schedule A – Schedule of Receivables	S-A-1

 

	EXHIBITS	 
	 	 
	Exhibit A – Form of Class A-1, A-2, A-3 and A-4 Notes	A-1
	Exhibit B – Form of Transferor Certificate for Retained Notes	B-1
	Exhibit C – Form of Investment Letter for Retained Notes	C-1
	Exhibit D – Servicing Criteria to be Addressed in Assessment of Compliance	D-1
	Exhibit E – Form of Monthly 15GA-1 Report	E-1

 

    v

     

    

 

This Indenture, dated November 24, 2021, is
between Honda Auto Receivables 2021-4 Owner Trust, a Delaware statutory trust (the “Issuer”), U.S. Bank National Association
as indenture trustee (the “Indenture Trustee” and “U.S. Bank”).

 

Each party agrees as follows for the benefit of
the other party and for the equal and ratable benefit of the holders of the Issuer’s Class A-1 0.14300% Asset Backed Notes,
Class A-2 0.39% Asset Backed Notes, Class A-3 0.88% Asset Backed Notes, Class A-4 1.14% Asset Backed Notes.

 

GRANTING CLAUSE

 

The Issuer hereby Grants to the Indenture Trustee
at the Closing Date, on behalf of and for the benefit of the Noteholders, without recourse, all of the Issuer’s right, title and
interest in, to and under (i) the Receivables and all monies due thereon and payments received thereon on and after November 1,
2021; (ii) the security interests in the Financed Vehicles; (iii) any proceeds of any physical damage insurance policies covering
the Financed Vehicles and in any proceeds of any credit life or credit disability insurance policies relating to the Receivables or the
Obligors; (iv) any proceeds of Dealer Recourse; (v) the right to realize upon any property (including the right to receive future
Liquidation Proceeds) that shall have secured a Receivable and have been repossessed by or on behalf of the Issuer; (vi) all funds,
and all investment property, from time to time carried in or credited to the Accounts, including the Reserve Fund Initial Deposit and
the Yield Supplement Account Deposit and in all investment income and proceeds thereof; (vii) the rights of the Seller under the
Receivables Purchase Agreement including, but not limited to, the representations and warranties set forth in Sections 2.02 and 2.03 therein
and the rights of the Issuer under the Sale and Servicing Agreement; and (viii) all proceeds of every kind and nature whatsoever
in respect of any or all of the foregoing, including all proceeds of the conversion thereof, voluntary or involuntary, into cash or other
liquid property, all cash proceeds, accounts, accounts receivable, notes, drafts, acceptances, chattel paper, checks, deposit accounts,
insurance proceeds, condemnation awards, rights to payment of any and every kind and other forms of obligations and receivables, instruments
and other property which at any time constitute all or part of or are included in the proceeds of any of the foregoing as each such term
is defined in Section 1.01 (collectively, the “Collateral”).

 

The foregoing Grant is made in trust to secure
(i) the payment of principal of and interest on, and any other amounts owing in respect of, the Notes, equally and ratably without
prejudice, priority or distinction, except as expressly provided in this Indenture and the Sale and Servicing Agreement and (ii) to
secure compliance with the provisions of this Indenture, all as provided in this Indenture.

 

The Indenture Trustee, as Indenture Trustee on
behalf of the Noteholders, acknowledges such Grant, accepts the trusts under this Indenture in accordance with the provisions of this
Indenture and agrees to perform its duties as required in this Indenture to the end that the interests of the Noteholders may be adequately
and effectively protected.

 

     

     

    

 

ARTICLE I

 

DEFINITIONS AND INCORPORATION BY REFERENCE

 

Section 1.01. Definitions. Except as
otherwise specified herein or as the context may otherwise require, defined terms used in this Indenture shall have the meanings ascribed
thereto in the Sale and Servicing Agreement.

 

Section 1.02. Incorporation by Reference
of Trust Indenture Act. Whenever this Indenture refers to a provision of the TIA, the provision is incorporated by reference in and
made a part of this Indenture. The following TIA terms used in this Indenture have the following meanings:

 

“Commission” means the Securities
and Exchange Commission.

 

“indenture securities” means
the Notes.

 

“indenture security holder”
means a Noteholder.

 

“indenture to be qualified”
means this Indenture.

 

“indenture trustee” or “institutional
trustee” means the Indenture Trustee.

 

“obligor” on the indenture securities
means the Issuer and any other obligor on the indenture securities.

 

All other TIA terms used in this Indenture that
are defined by the TIA or by reference to another statute or defined by Commission rule have the meaning assigned to them by such
definitions.

 

ARTICLE II

 

THE NOTES

 

Section 2.01. Form. The Class A-1
Notes, the Class A-2 Notes, the Class A-3 Notes and the Class A-4 Notes, in each case together with the Indenture Trustee’s
certificate of authentication, shall be in substantially the form set forth in Exhibit A with such appropriate insertions,
omissions, substitutions and other variations as are required or permitted by this Indenture, and may have such letters, numbers or other
marks of identification and such legends or endorsements placed thereon as may, consistently herewith, be determined by the officers executing
such Notes, as evidenced by their execution of the Notes. Any portion of the text of any Note may be set forth on the reverse thereof,
with an appropriate reference thereto on the face of the Note.

 

Definitive Notes shall be typewritten, printed,
lithographed or engraved or produced by any combination of these methods (with or without steel engraved borders), all as determined by
the officers executing such Notes, as evidenced by their execution of such Notes.

 

    	 	2	 

     

    

 

Each Note shall be dated the date of its authentication.
The terms of the Notes are the terms of this Indenture.

 

Section 2.02. Execution, Authentication
and Delivery. The Notes shall be executed on behalf of the Issuer by any of its Authorized Officers. The signature of any such Authorized
Officer on the Notes may be manual, facsimile or scanned. Notes bearing the manual, facsimile or scanned signature of individuals who
were at any time Authorized Officers of the Issuer shall bind the Issuer, notwithstanding that such individuals or any of them have ceased
to hold such offices prior to the authentication and delivery of such Notes or did not hold such offices at the date of such Notes.

 

The Indenture
Trustee shall, upon Issuer Order, authenticate and deliver for original issue the following aggregate principal amount of Notes: (i) $315,000,000
of Class A-1 Notes, (ii) $574,300,000 of Class A-2 Notes, (iii) $574,300,000 of Class A-3 Notes and (iv) $115,348,000
of Class A-4 Notes. The aggregate principal amount of Class A-1 Notes, Class A-2 Notes, Class A-3 Notes and Class A-4
Notes outstanding at any time may not exceed such respective amounts except as provided in Section 2.05.

 

Each Note shall be dated the date of its authentication.
The Notes shall be issuable as registered Notes in minimum denominations of $1,000 and in integral multiples of $1,000 in excess thereof.

 

No Note shall be entitled to any benefit under
this Indenture or be valid or obligatory for any purpose, unless there appears on such Note a certificate of authentication substantially
in the form provided for herein executed by the Indenture Trustee by the manual signature of one of its authorized signatories, and such
certificate upon any Note shall be conclusive evidence, and the only evidence, that such Note has been duly authenticated and delivered
hereunder.

 

Section 2.03. Temporary Notes. Pending
the preparation of Definitive Notes pursuant to Section 2.11, the Issuer may execute, and upon receipt of an Issuer Order the Indenture
Trustee shall authenticate and deliver, temporary Notes that are printed, lithographed, typewritten, mimeographed or otherwise produced,
of the tenor of the Definitive Notes in lieu of which they are issued and with such variations not inconsistent with the terms of this
Indenture as the officers executing such Notes may determine, as evidenced by their execution of such Notes.

 

If temporary Notes are issued, the Issuer shall
cause Definitive Notes to be prepared without unreasonable delay. After the preparation of Definitive Notes, the temporary Notes shall
be exchangeable for Definitive Notes upon surrender of the temporary Notes at the office or agency of the Issuer to be maintained as provided
in Section 3.02, without charge to the related Noteholder. Upon surrender for cancellation of any one or more temporary Notes, the
Issuer shall execute, and the Indenture Trustee shall authenticate and deliver in exchange therefor, a like tenor and principal amount
of Definitive Notes of authorized denominations. Until so exchanged, the temporary Notes shall in all respects be entitled to the same
benefits under this Indenture as Definitive Notes.

 

    	 	3	 

     

    

 

Section 2.04. Note Register, Registration
of Transfer and Exchange. The Issuer shall cause to be kept a register (the “Note Register”) in which, subject
to such reasonable regulations as it may prescribe, the Issuer shall provide for the registration of Notes and the registration of all
transfers of Notes. The Indenture Trustee initially shall be the “Note Registrar” for the purpose of registering Notes
and transfers of Notes as herein provided. Upon any resignation of any Note Registrar, the Issuer shall promptly appoint a successor or,
if it elects not to make such an appointment, assume the duties of Note Registrar.

 

If a Person other than the Indenture Trustee is
appointed by the Issuer as Note Registrar, the Issuer will give the Indenture Trustee prompt written notice of the appointment of such
Note Registrar and of the location, and any change in the location, of the Note Register and the Indenture Trustee shall have the right
to inspect the Note Register at all reasonable times and to obtain copies thereof, and the Indenture Trustee shall have the right to rely
upon a certificate executed on behalf of the Note Registrar by an Executive Officer thereof as to the names and addresses of the Noteholders
and the principal amounts and number of such Notes.

 

Upon surrender for registration of transfer of
any Note at the office or agency of the Issuer to be maintained as provided in Section 3.02, provided that the requirements of Section 

8-401 of the UCC are met, the Issuer shall execute, and the Indenture Trustee shall authenticate and the Noteholder shall obtain from
the Indenture Trustee, in the name of the designated transferee or transferees, one or more new Notes of the same Class in any authorized
denominations, of a like aggregate principal amount.

 

At the option of the Noteholder, Notes may be exchanged
for other Notes of the same Class in any authorized denominations, of a like aggregate principal amount, upon surrender of the Notes
to be exchanged at such office or agency. Whenever any Notes are so surrendered for exchange, provided that the requirements of Section 8-401
of the UCC are met (as determined by the Issuer), the Issuer shall execute, and the Indenture Trustee shall authenticate and the Noteholder
shall obtain from the Indenture Trustee, the Notes which the Noteholder making the exchange is entitled to receive.

 

All Notes issued upon any registration of transfer
or exchange of Notes shall be the valid obligations of the Issuer, evidencing the same debt, and entitled to the same benefits under this
Indenture, as the Notes surrendered upon such registration of transfer or exchange.

 

Every Note presented or surrendered for registration
of transfer or exchange shall be duly endorsed by, or be accompanied by a written instrument of transfer in form satisfactory to the Indenture
Trustee duly executed by, the Noteholder thereof or such Noteholder’s attorney duly authorized in writing, with such signature guaranteed
by an “eligible guarantor institution” meeting the requirements of the Note Registrar, which requirements include membership
or participation in the Securities Transfer Agent’s Medallion Program (“STAMP”) or such other “signature guarantee
program” as may be determined by the Note Registrar in addition to, or in substitution for, STAMP, all in accordance with the Exchange
Act.

 

No service charge shall be made to a Noteholder
for any registration of transfer or exchange of Notes, but the Issuer or the Indenture Trustee may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Notes,
other than exchanges pursuant to Section 2.03 or 9.06 not involving any transfer.

 

    	 	4	 

     

    

 

Neither the Issuer nor the Note Registrar will
be required to register transfers or exchanges of Notes that will be redeemed within fifteen (15) days after the requested date of transfer
or exchange.

 

Any Notes issued to and beneficially owned by the
Issuer or any other person treated as the same person as the Issuer for U.S. federal income tax purposes may not be sold, pledged, or
otherwise transferred unless counsel satisfactory to the Indenture Trustee has rendered an opinion to the effect that such Notes to be
sold, pledged, or otherwise transferred will be characterized as indebtedness for U.S. federal income tax purposes after such sale, pledge,
or other transfer. Any attempted sale, pledge, or other transfer in contravention of this paragraph will be void ab initio and
the purported transferor will continue to be treated as the owner of such Notes. If for tax or other reasons it may be necessary to track
any Notes, tracking conditions such as requiring separate CUSIPs or definitive form instruments may be required by the Sponsor or the
Administrator as a condition to such transfer.

 

Section 2.04A.  Transfer
Restrictions on the Retained Notes.

 

(a)            On
the Closing Date, each of the Retained Notes will be registered in the name of the Sponsor and issued in physical form as a Definitive
Note in the applicable form of Exhibit A hereto. No transfer of a Retained Note, other than to an Affiliate of the Sponsor,
shall be made unless such transfer is made pursuant to, (i) an effective registration statement under the Securities Act and any
applicable state securities laws or, (ii) is exempt from the registration requirements under the Securities Act and such state securities
laws. Except in the case of a transfer by the Sponsor to an Affiliate, in the event that a transfer is to be made in reliance upon an
exemption from the Securities Act and state securities laws, in order to assure compliance with the Securities Act and such laws, the
Noteholder desiring to effect such transfer and such Noteholder’s prospective transferee shall each certify to the Owner Trustee,
the Issuer, the Indenture Trustee and the Sponsor in writing the facts surrounding the transfer in substantially the forms set forth in
Exhibit B (the “Transferor Certificate”) and Exhibit C (the “Investment Letter”).
Except in the case of a transfer by the Sponsor to an Affiliate, there shall also be delivered to the Owner Trustee, the Issuer and the
Indenture Trustee an opinion of counsel that such transfer may be made pursuant to an exemption from the Securities Act and state securities
laws, which opinion of counsel shall not be an expense of the Issuer, the Owner Trustee or the Indenture Trustee; provided that such opinion
of counsel in respect of the applicable state securities laws may be a memorandum of law rather than an opinion if such counsel is not
licensed in the applicable jurisdiction. If the Sponsor subsequently transfers any of the Retained Notes in a transaction exempt from
the registration requirements under the Securities Act pursuant to Section 4(2) thereof and any Noteholder intends to transfer
such Retained Notes pursuant to Rule 144A, the Sponsor shall provide to any Noteholder and any prospective transferee designated
by any such Noteholder information regarding such Retained Notes and the Receivables and such other information as shall be necessary
to satisfy the condition to eligibility set forth in Rule 144A(d)(4) for transfer of any such Retained Notes without registration
thereof under the Securities Act pursuant to the registration exemption provided by Rule 144A, in each case with the cost of the
provision of such information to be borne by the requesting noteholder. Each Noteholder desiring to effect such a transfer shall, and
does hereby agree to, indemnify the Issuer, the Owner Trustee, the Indenture Trustee, the Depositor and AHFC (in any capacity) against
any liability that may result if the transfer is not so exempt or is not made in accordance with federal and state securities laws.

 

    	 	5	 

     

    

 

(b)            By
directly or indirectly acquiring any Retained Note in a transaction pursuant to Rule 144A, each underwriter, transferee and owner
of an ownership or beneficial interest will be required to represent, warrant and agree (if in Definitive Note form) or will be deemed
to represent, warrant and agree (if in Book Entry Note form) as follows:

 

(i)             it
understands that the Retained Notes have not been registered under the Securities Act, but were retained by the Sponsor, and may not be
sold except as permitted in the following sentence. It understands and agrees, on its own behalf and on behalf of any accounts for which
it is acting as hereinafter stated, (x) that such Retained Notes are being offered only in a transaction not involving any public
offering within the meaning of the Securities Act and (y) that such Retained Notes may be resold, pledged or transferred only (i) to
the Sponsor or an Affiliate, (ii) to an “accredited investor” as defined in Rule 501(a)(1),(2),(3) or (7) of
Regulation D under the Securities Act (an “Accredited Investor”) acting for its own account (and not for the account of others)
or as a fiduciary or agent for others (which others also are Accredited Investors unless the holder is a bank acting in its fiduciary
capacity) that executes a certificate substantially in the form of the Investment Letter, (iii) so long as such Retained Note is
eligible for resale pursuant to Rule 144A under the Securities Act, to a person whom it reasonably believes after due inquiry is
a “qualified institutional buyer” as defined in Rule 144A, acting for its own account (and not for the account of others)
or as a fiduciary or agent for others (which others also are “qualified institutional buyers”) to whom notice is given that
the resale, pledge or transfer is being made in reliance on Rule 144A or (iv) in a sale, pledge or other transfer made in a
transaction otherwise exempt from the registration requirements of the Securities Act, in which case the Sponsor shall require that both
the prospective transferor and the prospective transferee certify to the Indenture Trustee and the Sponsor in writing the facts surrounding
such transfer, which certification shall be in form and substance reasonably satisfactory to the Issuer, the Owner Trustee, the Indenture
Trustee and the Sponsor. Except in the case of a transfer described in clauses (i) or (iii) above, the Sponsor shall require
that a written opinion of counsel (which will not be at the expense of the Sponsor, any affiliate of the Sponsor, the Owner Trustee or
the Indenture Trustee), reasonably satisfactory to the Issuer and the Sponsor, be delivered to the Issuer, the Owner Trustee, the Indenture
Trustee and the Sponsor to the effect that such transfer will not violate the Securities Act, and will be effected in accordance with
any applicable securities laws of each state of the United States. It will notify any purchaser of the Retained Notes from it of the above
resale restrictions, if then applicable. It further understands that in connection with any transfer of the Retained Notes by it that
the Issuer and the Sponsor may request, and if so requested it will furnish, such certificates and other information as they may reasonably
require to confirm that any such transfer complies with the foregoing restrictions;

 

(ii)            if
eligible for resale pursuant to Rule 144A, it is a “qualified institutional buyer” as defined under Rule 144A under
the Securities Act and is acquiring the Retained Notes for its own account (and not for the account of others) or as a fiduciary or agent
for others (which others also are “qualified institutional buyers”). It is familiar with Rule 144A under the Securities
Act and is aware that the seller of the Retained Notes and other parties intend to rely on the foregoing representations, warranties and
acknowledgements and the exemption from the registration requirements of the Securities Act provided by Rule 144A;

 

    	 	6	 

     

    

 

(iii)           if
in Definitive Note form, it satisfies the requirements of Section 2.14 of this Indenture;

 

(iv)           it
understands that the Indenture Trustee, the Sponsor and others will rely upon the truth and accuracy of the foregoing acknowledgments,
representations and agreements, and it agrees that if any of the acknowledgments, representations and warranties deemed to have been made
by it by its purchase of the Retained Notes, for its own account or for one or more accounts as to each of which it exercises sole investment
discretion, are no longer accurate, it shall promptly notify the Sponsor; and

 

(v)            the
Indenture Trustee and the Sponsor are entitled to rely upon the foregoing representations, warranties and acknowledgements and are irrevocably
authorized to produce the foregoing representations, warranties and acknowledgments or a copy hereof to any interested party in any administrative
or legal proceeding or official inquiry with respect to the matters covered hereby.

 

(c)            In
the case of a transfer of the Retained Notes to an Affiliate of the Sponsor, the Sponsor shall provide a written representation to the
Issuer, the Indenture Trustee and the Owner Trustee that the transferee is an Affiliate of the Sponsor, and the Issuer, the Indenture
Trustee and the Owner Trustee may conclusively rely on such representation.

 

Section 2.05. Mutilated, Destroyed, Lost
or Stolen Notes. If (i) any mutilated Note is surrendered to the Indenture Trustee, or the Indenture Trustee receives evidence
to its satisfaction of the destruction, loss or theft of any Note, (ii) there is delivered to the Indenture Trustee such security
or indemnity as may be required by it to hold the Issuer and the Indenture Trustee harmless and (iii) the requirements of Section 8-405
of the UCC are met, then, in the absence of notice to the Issuer, the Note Registrar or the Indenture Trustee that such Note has been
acquired by a Protected Purchaser, the Issuer shall execute, and upon its written request the Indenture Trustee shall authenticate and
deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or stolen Note, a replacement Note of the same Class; provided,
however, that if any such destroyed, lost or stolen Note, but not a mutilated Note, shall have become or within seven (7) days shall
be due and payable, or shall have been called for redemption, instead of issuing a replacement Note, the Issuer may pay such destroyed,
lost or stolen Note when so due or payable or upon the Redemption Date without surrender thereof. If, after the delivery of such replacement
Note or payment of a destroyed, lost or stolen Note pursuant to the proviso to the preceding sentence, a Protected Purchaser of the original
Note in lieu of which such replacement Note was issued presents for payment such original Note, the Issuer and the Indenture Trustee shall
be entitled to recover such replacement Note (or such payment) from the Person to whom it was delivered or any Person taking such replacement
Note from such Person to whom such replacement Note was delivered or any assignee of such Person, except a protected purchaser, and shall
be entitled to recover upon the security or indemnity provided therefor to the extent of any loss, damage, cost or expense incurred by
the Issuer or the Indenture Trustee in connection therewith.

 

    	 	7	 

     

    

 

Upon the issuance of any replacement Note under
this Section, the Issuer or the Indenture Trustee may require the payment by the Noteholder of such Note of a sum sufficient to cover
any tax or other governmental charge that may be imposed in relation thereto and any other reasonable expenses (including the fees and
expenses of the Indenture Trustee or the Note Registrar) connected therewith.

 

Every replacement Note issued pursuant to this
Section in replacement of any mutilated, destroyed, lost or stolen Note shall constitute an original additional contractual obligation
of the Issuer, whether or not the mutilated, destroyed, lost or stolen Note shall be at any time enforceable by anyone, and shall be entitled
to all the benefits of this Indenture equally and proportionately with any and all other Notes duly issued hereunder.

 

The provisions of this Section are exclusive
and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed,
lost or stolen Notes.

 

Section 2.06. Persons Deemed Owner.
Prior to due presentment for registration of transfer of any Note, the Issuer, the Indenture Trustee and any of their respective agents
may treat the Person in whose name any Note is registered (as of the day of determination) as the owner of such Note for the purpose of
receiving payments of principal of and interest, if any, on such Note and for all other purposes whatsoever, whether or not such Note
be overdue, and none of the Issuer, the Indenture Trustee or any of their respective agents shall be affected by notice to the contrary.

 

Section 2.07. Payment of Principal and
Interest, Defaulted Interest.

 

(a)            Each
Class of Notes shall accrue interest at the related Interest Rate, and such interest shall be due and payable on each Payment Date
as specified therein, subject to Sections 3.01 and 11.12 hereof. Any installment of interest or principal, if any, payable on any Note
that is punctually paid or duly provided for by the Issuer on the applicable Payment Date shall be paid to the Person in whose name such
Note (or one or more Predecessor Notes) is registered on the Record Date by wire transfer in immediately available funds to the account
designated by such Person (and if such Notes are registered on the Record Date in the name of the nominee) of the Clearing Agency (initially,
such nominee to be Cede & Co.), payment will be made by wire transfer in immediately available funds to the account designated
by such nominee.

 

(b)            The
principal of each Note shall be payable as provided in Section 8.02(d) hereof. Notwithstanding the foregoing, the entire unpaid
principal amount of the Notes shall be due and payable, if not previously paid, on the related Final Scheduled Payment Date or the date
on which an Event of Default shall have occurred and be continuing, if the Indenture Trustee or Noteholders representing not less than
a majority of the Outstanding Amount have declared the Notes to be immediately due and payable in the manner provided in Section 5.02.
All principal payments on each Class of Notes shall be made pro rata to the Noteholders of such Class entitled thereto. The
Indenture Trustee shall notify the Person in whose name a Note is registered at the close of business five (5) Business Days preceding
the Payment Date on which the Issuer expects that the final installment of principal of and interest on such Note will be paid. Such notice
shall be mailed or transmitted by facsimile prior to such final Payment Date and shall specify that such final installment will be payable
only upon presentation and surrender of such Note and shall specify the place where such Note may be presented and surrendered for payment
of such installment; provided, however, if a Definitive Note is held by the Sponsor or any of its Affiliates, then the final installment
of principal of and interest on such Note may be paid prior to the surrender of the Note. Notices in connection with redemptions of Notes
shall be mailed to Noteholders as provided in Section 10.02.

 

    	 	8	 

     

    

 

(c)            If
the Issuer defaults in a payment of interest on the Notes, the Issuer shall pay defaulted interest (plus interest on such defaulted interest
to the extent lawful) at the applicable Interest Rate in any lawful manner. The Issuer may pay such defaulted interest to the Persons
who are Noteholders on a subsequent special record date, which date shall be at least five (5) Business Days prior to the next payment
date. The Issuer shall fix or cause to be fixed any such special record date and related payment date, and, at least fifteen (15) days
before any such special record date, the Issuer shall mail to each Noteholder a notice that states the special record date, the payment
date and the amount of defaulted interest to be paid.

 

Section 2.08. Cancellation. All Notes
surrendered for payment, registration of transfer, exchange or redemption shall, if surrendered to any Person other than the Indenture
Trustee, be delivered to the Indenture Trustee and shall be promptly cancelled by the Indenture Trustee. The Issuer may at any time deliver
to the Indenture Trustee for cancellation any Notes previously authenticated and delivered hereunder which the Issuer may have acquired
in any manner whatsoever, and all Notes so delivered shall be promptly cancelled by the Indenture Trustee. No Notes shall be authenticated
in lieu of or in exchange for any Notes cancelled as provided in this Section, except as expressly permitted by this Indenture. All cancelled
Notes may be held or disposed of by the Indenture Trustee in accordance with its standard retention or disposal policy as in effect at
the time unless the Issuer shall direct by an Issuer Order that they be destroyed or returned to it; provided, that such Issuer Order
is timely and the Notes have not been previously disposed of by the Indenture Trustee.

 

Section 2.09. Book-Entry Notes. The
Non-Retained Notes, upon original issuance, will be issued in the form of a typewritten Note or Notes representing the Book-Entry Notes,
to be delivered to the Indenture Trustee, as agent for The Depository Trust Company, the initial Clearing Agency, by, or on behalf of,
the Issuer. The Book-Entry Notes shall be registered initially on the Note Register in the name of Cede & Co., the nominee of
the initial Clearing Agency, and no Note Owner will receive a definitive Note representing such Note Owner’s interest in such Note,
except as provided in Section 2.11. Unless and until definitive, fully registered Notes (the “Definitive Notes”)
have been issued to such Note Owners pursuant to Section 2.11:

 

(i)             the
provisions of this Section shall be in full force and effect;

 

(ii)            the
Note Registrar and the Indenture Trustee shall be entitled to deal with the Clearing Agency for all purposes of this Indenture (including
the payment of principal of and interest on the Notes and the giving of instructions or directions hereunder) as the sole holder of the
Notes, and shall have no obligation to the Note Owners;

 

    	 	9	 

     

    

 

(iii)           to
the extent that the provisions of this Section conflict with any other provisions of this Indenture, the provisions of this Section shall
control;

 

(iv)           the
rights of Note Owners shall be exercised only through the Clearing Agency and shall be limited to those established by law and agreements
between such Note Owners and the Clearing Agency and/or the Clearing Agency Participants. Pursuant to the Note Depository Agreement, unless
and until Definitive Notes are issued pursuant to Section 2.11, the Clearing Agency will make book-entry transfers among the Clearing
Agency Participants and receive and transmit payments of principal of and interest on the Notes to such Clearing Agency Participants;
and

 

(v)            whenever
this Indenture requires or permits actions to be taken based upon instructions or directions of Noteholders evidencing a specified percentage
of the Outstanding Amount, the Clearing Agency shall be deemed to represent such percentage only to the extent that it has received instructions
to such effect from Note Owners and/or Clearing Agency Participants owning or representing, respectively, such required percentage of
the beneficial interest in the Notes and has delivered such instructions to the Indenture Trustee.

 

Section 2.10. Notices to Clearing Agency.
Whenever a notice or other communication to the Noteholders is required under this Indenture, unless and until Definitive Notes shall
have been issued to such Note Owners pursuant to Section 2.11, the Indenture Trustee shall give all such notices and communications
specified herein to be given to Noteholders to the Clearing Agency, and shall have no obligation to such Note Owners.

 

Section 2.11. Definitive Notes. On
the Closing Date, the Retained Notes will be issued in physical form as Definitive Notes in the applicable form of Exhibit A
hereto and registered in the name of the Sponsor. The Non-Retained Notes will be issued on the Closing Date as Book-Entry Notes; however,
if at anytime (i)(A) the Administrator advises the Indenture Trustee in writing that the Clearing Agency is no longer willing or
able to properly discharge its responsibilities with respect to the Book-Entry Notes and (B) neither the Indenture Trustee nor the
Administrator is able to locate a qualified successor, (ii) the Administrator at its option advises the Indenture Trustee in writing
that it elects to terminate the book-entry system through the Clearing Agency or (iii) after the occurrence of an Event of Default
or a Servicer Default, Owners of Book-Entry Notes representing beneficial interests aggregating at least a majority of the Outstanding
Amount of such Notes advise the Indenture Trustee and the Clearing Agency Participants through the Clearing Agency, in writing that the
continuation of a book-entry system through the Clearing Agency is no longer in the best interests of such Note Owners, then, in each
case, the Indenture Trustee shall notify all Note Owners of the related Class of Notes through the Clearing Agency of the occurrence
of any such event and of the availability of Definitive Notes of the related Class of Notes to Note Owners requesting the same. Upon
surrender to the Indenture Trustee of the Note or Notes representing the Book-Entry Notes by the Clearing Agency, accompanied by registration
instructions, the Issuer shall execute and the Indenture Trustee shall authenticate the Definitive Notes in accordance with the instructions
of the Clearing Agency. None of the Issuer, the Note Registrar or the Indenture Trustee shall be liable for any delay in delivery of such
instructions and may conclusively rely on, and shall be protected in relying on, such instructions. Upon the issuance of Definitive Notes
of a Class, the Indenture Trustee shall recognize the holders of the Definitive Notes as Noteholders hereunder. Except in the case of
a Noteholder who is an Affiliate of the Sponsor, subsequent Noteholders of Notes that were initially Retained Notes shall have the right,
but at such Noteholders sole cost and expense, to request that such Retained Notes be converted to Book Entry Notes and the Issuer, the
Indenture Trustee, the Administrative Agent and the Sponsor agree to cooperate and use reasonable efforts to effect such conversion.

 

    	 	10	 

     

    

 

Section 2.12. Release of Collateral.
Subject to Section 11.01 and the terms of the other Basic Documents, the Indenture Trustee shall release property from the lien of
this Indenture only upon receipt of an Issuer Request accompanied by an Officer’s Certificate, an Opinion of Counsel and (except
in the case of a full redemption under Section 10.01) Independent Certificates in accordance with TIA §§ 314(c) and
314(d)(1) or an Opinion of Counsel in lieu of such Independent Certificates to the effect that the TIA does not require any such
Independent Certificates.

 

Section 2.13. Tax Treatment; Tax Information.

 

(a)            The
Issuer has entered into this Indenture, and the Notes will be issued (other than Notes beneficially owned by the Issuer or any other person
treated as the same person as the Issuer for U.S. federal income tax purposes unless transferred in accordance with Section 2.04),
with the intention that, for all purposes including U.S. federal income, state and local income and franchise tax purposes, the Notes
will qualify as indebtedness secured by the Owner Trust Estate. The Issuer, by entering into this Indenture, and each Noteholder, by its
acceptance of a Note (and each Note Owner by its acceptance of an interest in the applicable Book-Entry Note), agree to treat the Notes
(other than Notes beneficially owned by the Issuer or any other person treated as the same person as the Issuer for U.S. federal income
tax purposes unless transferred in accordance with Section 2.04) for all purposes including U.S. federal income, state and local
income and franchise tax purposes as indebtedness.

 

(b)            Each
Noteholder, by its acceptance of a Note, and Note Owner, if different, by its acceptance of a beneficial interest in a Note, agrees to
provide and shall provide to the person making payments on the Note to it (or other person responsible for withholding of taxes) with
the Tax Information, and will update or replace such Tax Information when it becomes incorrect or obsolete, at any time required by applicable
law or promptly upon request. Each Noteholder and Note Owner is deemed to understand, acknowledge and agree that the Indenture Trustee,
Paying Agent and Issuer (or other person responsible for withholding of taxes) have the right to withhold on payments with respect to
a Note (without any corresponding gross-up) where an applicable party fails to comply with the requirements set forth in the preceding
sentence or the Indenture Trustee, Paying Agent or Issuer (or other person responsible for withholding of taxes) is otherwise required
to so withhold under applicable law.

 

    	 	11	 

     

    

 

Section 2.14. Employee Benefit Plans.
The transfer of a Definitive Note shall not be registered unless the prospective transferee (and if the transferee is a Plan, its fiduciary)
has represented in writing to the Indenture Trustee that either (i) it is not acquiring such Note with the assets of a Benefit Plan
Investor or a Plan that is subject to Similar Law; or (ii) its acquisition and holding of such Note will not give rise to, in the
case of a Benefit Plan Investor, a nonexempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code or,
in the case of a Plan that is subject to Similar Law, a violation of Similar Law. Any Person that acquires a beneficial interest in a
Book Entry Note shall be deemed to make the same representations as set forth above in this Section 2.14.

 

ARTICLE III

 

COVENANTS

 

Section 3.01. Payment of Principal and
Interest. The Issuer will duly and punctually pay the principal of and interest, if any, on the Notes in accordance with the terms
of the Notes and this Indenture. Without limiting the foregoing, subject to Section 8.02(c), the Issuer will cause to be distributed
all amounts on deposit in the Note Distribution Account on a Payment Date deposited therein in accordance with Section 8.02(d). Amounts
properly withheld under the Code by any Person from a payment to any Noteholder of interest and/or principal shall be considered as having
been paid by the Issuer to such Noteholder for all purposes of this Indenture.

 

Section 3.02. Maintenance of Office or
Agency. The Issuer will maintain an office or agency where Notes may be surrendered for registration of transfer or exchange, and
where notices and demands to or upon the Issuer in respect of the Notes and this Indenture may be served and such office initially will
be located in St. Paul, Minnesota. The Issuer hereby initially appoints the Indenture Trustee to serve as its agent for the foregoing
purposes. The Issuer will give prompt written notice to the Indenture Trustee of the location, and of any change in the location, of any
such office or agency. If at any time the Issuer shall fail to maintain any such office or agency or shall fail to furnish the Indenture
Trustee with the address thereof, such surrenders, notices and demands may be made or served at the Corporate Trust Office, and the Issuer
hereby appoints the Indenture Trustee as its agent to receive all such surrenders, notices and demands, provided that the Indenture Trustee
shall not serve as an agent or office for the purpose of service of process on behalf of the Issuer.

 

Section 3.03. Money for Payments to be
Held in Trust. As provided in Sections 5.04 and 8.02, all payments of amounts due and payable with respect to any Notes that are to
be made from amounts withdrawn from the Collection Account and the Note Distribution Account pursuant to Section 8.02(c) shall
be made on behalf of the Issuer by the Indenture Trustee or by another Paying Agent, and no amounts so withdrawn from the Collection Account
and the Note Distribution Account for payments of Notes shall be paid over to the Issuer except as provided in this Section.

 

On or before the Business Day immediately preceding
each Payment Date and Redemption Date, the Issuer shall deposit or cause to be deposited in the Collection Account (to be transferred
to the Note Distribution Account on the related Payment Date) an aggregate sum sufficient to pay the amounts then becoming due under the
Notes, such sum to be held in trust for the benefit of the Persons entitled thereto, and (unless the Paying Agent is the Indenture Trustee)
shall promptly notify the Indenture Trustee in writing of its action or failure so to act.

 

    	 	12	 

     

    

 

The Issuer will cause each Paying Agent other than
the Indenture Trustee to execute and deliver to the Indenture Trustee an instrument in which such Paying Agent shall agree with the Indenture
Trustee (and if the Indenture Trustee acts as Paying Agent, it hereby so agrees), subject to the provisions of this Section, that such
Paying Agent will:

 

(i)             hold
all sums held by it for the payment of amounts due with respect to the Notes in trust for the benefit of the Persons entitled thereto
until such sums shall be paid to such Persons or otherwise disposed of as herein provided and pay such sums to such Persons as herein
provided;

 

(ii)            give
the Indenture Trustee notice of any default by the Issuer (or any other obligor upon the Notes) of which it has actual knowledge in the
making of any payment required to be made with respect to the Notes;

 

(iii)           at
any time during the continuance of any such default, upon the written request of the Indenture Trustee, forthwith pay to the Indenture
Trustee all sums so held in trust by such Paying Agent;

 

(iv)           immediately
resign as a Paying Agent and forthwith pay to the Indenture Trustee all sums held by it in trust for the payment of Notes if at any time
it ceases to meet the standards required to be met by a Paying Agent at the time of its appointment;

 

(v)            comply
with all requirements of the Code with respect to the withholding from any payments made by it on any Notes of any applicable withholding
taxes imposed thereon (including obtaining and retaining from Persons entitled to payments with respect to the Notes any Tax Information
and making any withholdings with respect to the Notes as required by the Code and paying over such withheld amounts to the appropriate
governmental authority) and

 

(vi)           comply
with any applicable reporting requirements in connection with any payments made by it on any Notes and any withholding of taxes therefrom,
and, upon request, provide any Tax Information to the Issuer.

 

The Issuer may at any time, for the purpose of
obtaining the satisfaction and discharge of this Indenture or for any other purpose, by Issuer Order direct any Paying Agent to pay to
the Indenture Trustee all sums held in trust by such Paying Agent, such sums to be held by the Indenture Trustee upon the same trusts
as those upon which the sums were held by such Paying Agent; and upon such payment by any Paying Agent to the Indenture Trustee, such
Paying Agent shall be released from all further liability with respect to such money.

 

    	 	13	 

     

    

 

Subject to applicable laws with respect to escheat
of funds, any money held by the Indenture Trustee or any Paying Agent in trust for the payment of any amount due with respect to any Note
and remaining unclaimed for two years after such amount has become due and payable shall be discharged from such trust and be paid to
the Issuer on Issuer Request; and the Noteholder of such Note shall thereafter, as an unsecured general creditor, look only to the Issuer
for payment thereof (but only to the extent of the amounts so paid to the Issuer), and all liability of the Indenture Trustee or such
Paying Agent with respect to such trust money shall thereupon cease; provided, however, that the Indenture Trustee or such Paying Agent,
before being required to make any such repayment, shall at the expense and written direction of the Issuer cause to be published once,
in a newspaper published in the English language, customarily published on each Business Day and of general circulation in The City of
New York, notice that such money remains unclaimed and that, after a date specified therein, which shall not be less than thirty (30)
days from the date of such publication, any unclaimed balance of such money then remaining will be repaid to or for the account of the
Issuer. The Indenture Trustee shall also adopt and employ, at the expense and written direction of the Issuer, any other reasonable means
of notification of such repayment (including, but not limited to, mailing notice of such repayment to Noteholders whose Notes have been
called but have not been surrendered for redemption or whose right to or interest in monies due and payable but not claimed is determinable
from the records of the Indenture Trustee or of any Paying Agent, at the last address of record for each such Noteholder).

 

Section 3.04. Existence. The Issuer
will keep in full effect its existence, rights and franchises as a statutory trust under the laws of the State of Delaware (unless it
becomes, or any successor Issuer hereunder is or becomes, organized under the laws of any other State or of the United States, in which
case the Issuer will keep in full effect its existence, rights and franchises under the laws of such other jurisdiction) and will obtain
and preserve its qualification to do business in each jurisdiction in which such qualification is or shall be necessary to protect the
validity and enforceability of this Indenture, the Notes, the Collateral and each other instrument or agreement included in the Owner
Trust Estate in connection with this Indenture and the other Basic Documents and the transactions contemplated hereby and thereby until
such time as the Issuer shall terminate in accordance with the terms hereof.

 

Section 3.05. Protection of Owner Trust
Estate. The Issuer intends the security interest Granted pursuant to this Indenture in favor of the Indenture Trustee on behalf of
the Noteholders to be prior to all other liens in respect of the Owner Trust Estate, and the Issuer shall take all actions necessary to
obtain and maintain, for the benefit of the Indenture Trustee on behalf of the Noteholders, a first lien on and a first priority, perfected
security interest in the Owner Trust Estate. The Issuer will from time to time execute and deliver all such supplements and amendments
hereto and all such financing statements, continuation statements, instruments of further assurance and other instruments, all as prepared
by the Administrator and delivered to the Issuer, and will take such other action necessary or advisable to:

 

(i)             grant
more effectively any portion of the Owner Trust Estate;

 

(ii)            maintain
or preserve the lien and security interest (and the priority thereof) created by this Indenture or carry out more effectively the purposes
hereof;

 

(iii)           perfect,
publish notice of or protect the validity of any Grant made or to be made by this Indenture;

 

(iv)           enforce
any of the Collateral;

 

(v)            preserve
and defend title to the Owner Trust Estate and the rights of the Indenture Trustee and the Noteholders in such Owner Trust Estate against
the claims of all persons and parties; or

 

    	 	14	 

     

    

 

 

(vi)            pay
all taxes or assessments levied or assessed upon the Owner Trust Estate when due.

 

Financing statements filed pursuant to such appointment
may describe the Owner Trust Estate in the same manner as described herein or may describe the collateral subject thereto as “All
of the Debtor’s personal property and other assets, whether now owned or existing or hereafter acquired or arising, together with
all products and proceeds thereof, substitutions and replacements therefor, and additions and accessions thereto.”

 

Section 3.06. Opinions as to Owner Trust
Estate.

 

(a)            Promptly
after the execution and delivery of this Indenture, the Issuer shall furnish to the Indenture Trustee an Opinion of Counsel to the effect
that, in the opinion of such counsel, either (i) all financing statements and continuation statements have been executed and filed
that are necessary to create and continue the Indenture Trustee’s first priority perfected security interest in the collateral for
the benefit of the Noteholders, and reciting the details of such filings or referring to prior Opinions of Counsel in which such details
are given, or (ii) no such action shall be necessary to perfect such security interest.

 

(b)            Within
ninety (90) days after the beginning of each fiscal year of the Issuer (commencing with the first fiscal year that begins on a date that
is more than three months after the Cutoff Date), the Issuer shall furnish to the Indenture Trustee an Opinion of Counsel, dated as of
a date during such 90-day period, stating that, in the opinion of such counsel, either (i) all financing statements and continuation
statements have been filed that are necessary to create and continue the Indenture Trustee’s first priority perfected security interest
in the collateral for the benefit of the Noteholders, and reciting the details of such filings or referring to prior Opinions of Counsel
in which such details are given, or (ii) no such action shall be necessary to perfect such security interest.

 

Section 3.07. Performance of Obligations;
Servicing of Receivables.

 

(a)            The
Issuer will not take any action and will use its best efforts not to permit any action to be taken by others that would release any Person
from any of such Person’s material covenants or obligations under any instrument or agreement included in the Owner Trust Estate
or that would result in the amendment, hypothecation, subordination, termination or discharge of, or impair the validity or effectiveness
of, any such instrument or agreement, except as expressly provided in this Indenture, the other Basic Documents or such other instrument
or agreement.

 

(b)            The
Issuer may contract with other Persons to assist it in performing its duties under this Indenture, and any performance of such duties
by a Person identified to the Indenture Trustee in an Officer’s Certificate of the Issuer shall be deemed to be action taken by
the Issuer. Initially, the Issuer has contracted with the Servicer and the Administrator to assist the Issuer in performing its duties
under this Indenture.

 

(c)            The
Issuer will and will cause the Administrator to, punctually perform and observe all of its obligations and agreements contained in this
Indenture, the other Basic Documents and in the instruments and agreements included in the Owner Trust Estate, including but not limited
to filing or causing to be filed all UCC financing statements and continuation statements required to be filed by the terms of this Indenture
and the other Basic Documents in accordance with and within the time periods provided for herein and therein. Except as otherwise expressly
provided therein, the Issuer shall not waive, amend, modify, supplement or terminate any Basic Document or any provision thereof without
the written consent of the Indenture Trustee or the Noteholders of at least a majority of the Outstanding Amount or such greater percentage
as may be specified in the particular provision.

 

    	 	15	 

     

    

 

(d)            If
the Issuer shall have knowledge of the occurrence of a Servicer Default, the Issuer shall promptly provide written notice to a Responsible
Officer of the Indenture Trustee and to the Administrator thereof, and shall specify in such notice the action, if any, the Issuer is
taking with respect of such default. If a Servicer Default shall arise from the failure of the Servicer to perform any of its duties or
obligations under the Sale and Servicing Agreement with respect to the Receivables, the Issuer shall take all reasonable steps available
to it to remedy such failure. The Administrator shall, in accordance with Section 1.02(c) of the Administration Agreement, make
such notice available to each Rating Agency.

 

(e)            As
promptly as possible after the giving of notice of termination to the Servicer of the Servicer’s rights and powers pursuant to Section 7.01
of the Sale and Servicing Agreement, the Issuer shall promptly notify a Responsible Officer of the Indenture Trustee and the Indenture
Trustee shall appoint a Successor Servicer, and such Successor Servicer shall accept its appointment by a written assumption in a form
acceptable to the Indenture Trustee. In the event that a Successor Servicer has not been appointed and accepted its appointment at the
time when the Servicer ceases to act as Servicer, the Indenture Trustee without further action shall automatically be appointed the Successor
Servicer. The Indenture Trustee may resign as the Servicer by giving written notice of such resignation to the Issuer and in such event
will be released from such duties and obligations, such release not to be effective until the date a new servicer enters into a servicing
agreement as provided below. Upon delivery of any such notice to the Issuer, the Issuer shall obtain a new servicer as the Successor Servicer
under the Sale and Servicing Agreement. As soon as such a Successor Servicer is appointed, the Issuer shall notify the Indenture Trustee
of such appointment, specifying in such notice the name and address of such Successor Servicer. Any Successor Servicer other than the
Indenture Trustee shall (i) be an established financial institution having a net worth of not less than $50,000,000 and whose regular
business includes the servicing of motor vehicle receivables and (ii) enter into a servicing agreement with the Issuer and the Seller
having substantially the same provisions as the provisions of the Sale and Servicing Agreement applicable to the Servicer. If within thirty
(30) days after the delivery of the notice referred to above, the Issuer shall not have obtained such a new servicer, the Indenture Trustee
may appoint, or may petition a court of competent jurisdiction to appoint, a Successor Servicer. In connection with any such appointment,
the Issuer may make such arrangements for the compensation of such successor as it and such successor shall agree, subject to the limitations
set forth below and in the Sale and Servicing Agreement, and in accordance with Section 7.02 of the Sale and Servicing Agreement,
the Issuer and the Seller shall enter into an agreement with such successor for the servicing of the Receivables (such agreement to be
in form and substance satisfactory to the Indenture Trustee). If the Indenture Trustee shall succeed to the Servicer’s duties as
servicer of the Receivables as provided herein, it shall do so in its individual capacity and not in its capacity as Indenture Trustee
and, accordingly, the provisions of Article VI shall be inapplicable (except as set forth in the proviso contained in Section 6.01(a))
to the Indenture Trustee in its duties as the successor to the Servicer and the servicing of the Receivables. In case the Indenture Trustee
shall become successor to the Servicer under the Sale and Servicing Agreement, the Indenture Trustee shall be entitled to appoint as Servicer
any one of its Affiliates or agents, provided that it shall be fully liable for the actions and omissions of such Affiliate or agent in
such capacity as Successor Servicer.

 

    	 	16	 

     

    

 

Section 3.08. Negative Covenants. So
long as any Notes are Outstanding, the Issuer shall not:

 

(i)            except
as expressly permitted by Section 3.10(b) and the Basic Documents, sell, transfer, exchange or otherwise dispose of any of the
properties or assets of the Issuer, including those included in the Owner Trust Estate, unless directed to do so by the Indenture Trustee;

 

(ii)            claim
any credit on, or make any deduction from the principal or interest payable in respect of, the Notes (other than amounts properly withheld
from such payments under the Code or applicable state law) or assert any claim against any present or former Noteholder by reason of the
payment of the taxes levied or assessed upon any part of the Owner Trust Estate;

 

(iii)          (A) permit
the validity or effectiveness of this Indenture to be impaired, or permit the lien created by this Indenture to be amended, hypothecated,
subordinated, terminated or discharged, or permit any Person to be released from any covenants or obligations with respect to the Notes
under this Indenture except as may be expressly permitted hereby, (B) permit any lien, charge, excise, claim, security interest,
mortgage or other encumbrance (other than the lien of this Indenture) to be created on or extend to or otherwise arise upon or burden
the Owner Trust Estate or any part thereof or any interest therein or the proceeds thereof (other than tax liens, mechanics’ liens
and other liens that arise by operation of law, in each case on any of the Financed Vehicles and arising solely as a result of an action
or omission of the related Obligor) or (C) permit the lien created by this Indenture not to constitute a valid first priority (other
than with respect to any such tax, mechanics’ or other lien) security interest in the Owner Trust Estate; or

 

(iv)          dissolve
or liquidate in whole or in part.

 

Section 3.09. Annual Statement as to Compliance.

 

(a)            The
Issuer will deliver to the Indenture Trustee, within 90 days after the end of each fiscal year of the Issuer (commencing with the fiscal
year ended March 31, 2022), an Officer’s Certificate stating, as to the Authorized Officer signing such Officer’s Certificate,
that:

 

(i)            a
review of the activities of the Issuer during such year (since the Closing Date, in the case of the first of such Officer’s Certificate)
and of its performance under this Indenture has been made under such Authorized Officer’s supervision; and

 

(ii)            to
the best of such Authorized Officer’s knowledge, based on such review, the Issuer has complied with all conditions and covenants
under this Indenture throughout such year or, if there has been a default in its compliance with any such condition or covenant, specifying
each such default known to such Authorized Officer and the nature and status thereof.

 

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(b)          On
or before June 1st of each calendar year in which a Form 10-K is required to be filed on behalf of the Issuer, commencing
in 2022, the Indenture Trustee shall deliver to the Issuer and the Administrator a report regarding the Indenture Trustee’s assessment
of compliance with each of the Servicing Criteria specified on Exhibit D hereto during the immediately preceding reporting
year accompanied by an attestation report by a registered public accounting firm, in each case as required under Rules 13a-18 and
15d-18 of the Exchange Act and Item 1122 of Regulation AB. Such report shall be signed by an authorized officer of the Indenture
Trustee, and shall address each of the Servicing Criteria specified on Exhibit D hereto.

 

Section 3.10. Issuer May Consolidate, etc.,
Only on Certain Terms.

 

(a)          The
Issuer shall not consolidate or merge with or into any other Person, unless:

 

(i)            the
Person (if other than the Issuer) formed by or surviving such consolidation or merger shall be a Person organized and existing under the
laws of the United States or any State and shall expressly assume, by an indenture supplemental hereto, executed and delivered to the
Indenture Trustee, in form satisfactory to the Indenture Trustee, the due and punctual payment of the principal of and interest on all
Notes and the performance or observance of every agreement and covenant of this Indenture, and each other Basic Document, on the part
of the Issuer to be performed or observed;

 

(ii)            immediately
after giving effect to such transaction, no Default or Event of Default shall have occurred and be continuing;

 

(iii)            the
Rating Agency Condition shall have been satisfied with respect to such transaction;

 

(iv)            the
Issuer shall have received an Opinion of Counsel (and shall have delivered copies thereof to the Indenture Trustee) to the effect that
such transaction will not have any material adverse U.S. federal tax consequence to the Issuer, any Noteholder or any Certificateholder;

 

(v)            any
action that is necessary to maintain the lien and security interest created by this Indenture shall have been taken; and

 

(vi)            the
Issuer shall have delivered to the Indenture Trustee an Officer’s Certificate and an Opinion of Counsel (which shall describe the
actions taken as required by clause (v) above or that no actions will be taken) each stating that such consolidation or merger comply
with this Article and that all conditions precedent herein provided for relating to such transaction have been complied with (including
any filing required by the Exchange Act).

 

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(b)          The
Issuer shall not convey or transfer all or substantially all of its properties or assets, including those included in the Owner Trust
Estate, to any Person (except as expressly permitted by the Basic Documents), unless:

 

(i)             the
Person that acquires by conveyance or transfer the properties or assets of the Issuer shall (A) be a United States citizen or a Person
organized and existing under the laws of the United States or any State, (B) expressly assume, by an indenture supplemental hereto,
executed and delivered to the Indenture Trustee, in form satisfactory to the Indenture Trustee, the due and punctual payment of the principal
of and interest on all Notes and the performance or observance of every agreement and covenant of this Indenture and each other Basic
Document on the part of the Issuer to be performed or observed, all as provided herein, (C) expressly agree by means of such supplemental
indenture that all right, title and interest so conveyed or transferred shall be subject and subordinate to the rights of Noteholders,
(D) unless otherwise provided in such supplemental indenture, expressly agree to indemnify, defend and hold harmless the Issuer against
and from any loss, liability or expense arising under or related to this Indenture and the Notes and (E) expressly agree by means
of such supplemental indenture that such Person (or if a group of Persons, then one specified Person) shall make all filings with the
Commission (and any other appropriate Person) required by the Exchange Act in connection with the Notes;

 

(ii)             immediately
after giving effect to such transaction, no Default or Event of Default shall have occurred and be continuing;

 

(iii)            the
Rating Agency Condition shall have been satisfied with respect to such transaction;

 

(iv)            the
Issuer shall have received an Opinion of Counsel (and shall have delivered copies thereof to the Indenture Trustee) to the effect that
such transaction will not have any material adverse U.S. federal tax consequence to the Issuer, any Noteholder or any Certificateholder;

 

(v)             any
action that is necessary to maintain the lien and security interest created by this Indenture shall have been taken; and

 

(vi)            the
Issuer shall have delivered to the Indenture Trustee an Officer’s Certificate and an Opinion of Counsel (which shall describe the
actions taken as required by clause (v) above or that no actions will be taken) each stating that such conveyance or transfer and
such supplemental indenture comply with this Article and that all conditions precedent herein provided for relating to such transaction
have been complied with (including any filing required by the Exchange Act).

 

Section 3.11. Successor or Transferee.

 

(a)          Upon
any consolidation or merger of the Issuer in accordance with Section 3.10(a), the Person formed by or surviving such consolidation
or merger (if other than the Issuer) shall succeed to, and be substituted for, and may exercise every right and power of, the Issuer under
this Indenture with the same effect as if such Person had been named as the Issuer herein.

 

    	 	19	 

     

    

 

(b)            Upon
a conveyance or transfer of all of the properties or assets of the Issuer pursuant to Section 3.10(b), the Issuer will be released
from every covenant and agreement of this Indenture to be observed or performed on the part of the Issuer with respect to the Notes immediately
upon the delivery of written notice to the Indenture Trustee stating that the Issuer is to be so released.

 

Section 3.12. No Other Business. The
Issuer shall not engage in any business other than financing, purchasing, owning, selling and managing the Receivables in the manner contemplated
by this Indenture and the other Basic Documents and activities incidental thereto.

 

Section 3.13. No Borrowing. The Issuer
shall not issue, incur, assume, guarantee or otherwise become liable, directly or indirectly, for any indebtedness except for (i) the
Notes and (ii) any other indebtedness permitted by or arising under the other Basic Documents.

 

Section 3.14. Servicer’s Obligations.
The Issuer shall cause the Servicer to comply with Sections 3.10, 3.11, 3.12, 4.10 and Article VIII of the Sale and Servicing Agreement.

 

Section 3.15. Guarantees, Loans, Advances
and Other Liabilities. Except as contemplated by the Basic Documents, the Issuer shall not make any loan or advance or credit to,
or guarantee (directly or indirectly or by an instrument having the effect of assuring another’s payment or performance on any obligation
or capability of so doing or otherwise), endorse or otherwise become contingently liable, directly or indirectly, in connection with the
obligations, stocks or dividends of, or own, purchase, repurchase or acquire (or agree contingently to do so) any stock, obligations,
assets or securities of, or any other interest in, or make any capital contribution to, any other Person.

 

Section 3.16. Capital Expenditures.
The Issuer shall not make any expenditure (by long-term or operating lease or otherwise) for capital assets (either realty or personalty).

 

Section 3.17. Removal of Administrator.
So long as any Notes are Outstanding, the Issuer shall not remove the Administrator without cause unless the Rating Agency Condition shall
have been satisfied in connection with such removal.

 

Section 3.18. Restricted Payments.
Except as expressly permitted by the Basic Documents, the Issuer shall not, directly or indirectly, (i) pay any dividend or make
any distribution (by reduction of capital or otherwise), whether in cash, property, securities or a combination thereof, to the Owner
Trustee or any owner of a beneficial interest in the Issuer or otherwise with respect to any ownership or equity interest or security
in or of the Issuer or to the Servicer, (ii) redeem, purchase, retire or otherwise acquire for value any such ownership or equity
interest or security or (iii) set aside or otherwise segregate any amounts for any such purpose; provided, however, that the Issuer
may make, or cause to be made, (a) distributions as contemplated by, and to the extent funds are available for such purpose under
this Indenture, the Sale and Servicing Agreement or the Trust Agreement, (b) payments to the Indenture Trustee pursuant to Section 1.02(b)(ii) of
the Administration Agreement. The Issuer will not, directly or indirectly, make payments to or distributions from the Collection Account
except in accordance with this Indenture and the Basic Documents.

 

    	 	20	 

     

    

 

Section 3.19. Notice of Events of Default.
The Issuer shall give a Responsible Officer of the Indenture Trustee and each Rating Agency prompt written notice of each Event of Default
hereunder and each default on the part of the Servicer or the Seller of its obligations under the Sale and Servicing Agreement.

 

Section 3.20. Further Instruments and Acts.
Upon request of the Indenture Trustee, the Issuer will execute and deliver such further instruments and do such further acts as may be
reasonably necessary or proper to carry out more effectively the purpose of this Indenture.

 

Section 3.21. Compliance with Laws.
The Issuer shall comply with the requirements of all applicable laws, the non-compliance with which would, individually or in the aggregate,
materially and adversely affect the ability of the Issuer to perform its obligations under the Notes, this Indenture or any Basic Document.

 

ARTICLE IV

 

SATISFACTION AND DISCHARGE

 

Section 4.01. Satisfaction and Discharge
of Indenture. This Indenture shall cease to be of further effect with respect to the Notes except as to (i) rights of registration
of transfer and exchange, (ii) substitution of mutilated, destroyed, lost or stolen Notes, (iii) rights of Noteholders to receive
payments of principal thereof and interest thereon, (iv) Sections 3.03, 3.04, 3.05, 3.08, 3.10, 3.12, 3.13, 3.20 and 3.22, (v) the
rights, obligations and immunities of the Indenture Trustee hereunder (including the rights of the Indenture Trustee under Section 6.07
and the obligations of the Indenture Trustee under Section 4.02) and (vi) the rights of Noteholders as beneficiaries hereof
with respect to the property so deposited with the Indenture Trustee payable to all or any of them, and the Indenture Trustee, on written
demand of and at the expense of the Issuer, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture
with respect to the Notes, when

 

(i)            either

 

(A)          all
Notes theretofore authenticated and delivered (other than (i) Notes that have been destroyed, lost or stolen and that have been replaced
or paid as provided in Section 2.05 and (ii) Notes for whose payment money has theretofore been deposited in trust or segregated
and held in trust by the Issuer and thereafter repaid to the Issuer or discharged from such trust, as provided in Section 3.03) have
been delivered to the Indenture Trustee for cancellation; or

 

(B)          all
Notes not theretofore delivered to the Indenture Trustee for cancellation

 

(1)            have
become due and payable,

 

(2)            will
become due and payable at the Class A-4 Final Scheduled Payment Date within one year, or

 

    	 	21	 

     

    

 

(3)            are
to be called for redemption within one year under arrangements satisfactory to the Indenture Trustee for the giving of notice of redemption
by the Indenture Trustee in the name, and at the expense, of the Issuer,

 

and the Issuer, in the case of clauses (1), (2) or (3) above,
has irrevocably deposited or caused to be irrevocably deposited with the Indenture Trustee cash or direct obligations of or obligations
guaranteed by the United States (which will mature prior to the date such amounts are payable), in trust for such purpose, in an amount
sufficient to pay and discharge the entire indebtedness on such Notes not theretofore delivered to the Indenture Trustee for cancellation
when due to the related Final Scheduled Payment Date or Redemption Date (if Notes shall have been called for redemption pursuant to Section 10.01),
as the case may be;

 

(ii)            the
Issuer has paid or performed or caused to be paid or performed all amounts and obligations which the Issuer may owe to or on behalf of
the Indenture Trustee for the benefit of the Noteholders, under this Indenture or the Notes; and

 

(iii)            the
Issuer has delivered to the Indenture Trustee an Officer’s Certificate, an Opinion of Counsel and (if required by the TIA or the
Indenture Trustee) an Independent Certificate from a firm of certified public accountants, each meeting the applicable requirements of
Section 11.01(a) and, subject to Section 11.02, each stating that all conditions precedent herein provided for relating
to the satisfaction and discharge of this Indenture have been complied with.

 

Section 4.02. Application of Trust Money.
All monies deposited with the Indenture Trustee pursuant to Section 4.01 shall be held in trust in a segregated non-interest bearing
account and applied by it, (a) in accordance with the provisions of the Notes, the Sale and Servicing Agreement and this Indenture,
to the payment, either directly or through any Paying Agent, as the Indenture Trustee may determine, to the Noteholders of the particular
Notes for the payment or redemption of which such monies have been deposited with the Indenture Trustee, of all sums due and to become
due thereon for principal and interest; but such monies need not be segregated from other funds of the Issuer except to the extent required
herein or in the Sale and Servicing Agreement or required by law and (b) in accordance with instructions from the Administrator,
on which instructions the Indenture Trustee may conclusively rely.

 

Section 4.03. Repayment of Monies Held
by Paying Agent. In connection with the satisfaction and discharge of this Indenture with respect to the Notes, all monies then held
by any Paying Agent other than the Indenture Trustee under the provisions of this Indenture with respect to such Notes shall, upon demand
of the Issuer, be paid to the Indenture Trustee to be held and applied according to Section 3.03 and thereupon such Paying Agent
shall be released from all further liability with respect to such monies.

 

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ARTICLE V

 

REMEDIES

 

Section 5.01. Events of Default. “Event
of Default”, wherever used herein, means any one of the following events (whatever the reason for such Event of Default and whether
it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or order of any court or any
order, rule or regulation of any administrative or governmental body):

 

(i)            default
by the Issuer in the payment of any interest on any Note when the same becomes due and payable, and such default shall continue for a
period of five (5) Business Days or more;

 

(ii)            default
by the Issuer in the payment of the principal of or any installment of the principal of any Note at the Final Scheduled Payment Date for
such Class of Notes;

 

(iii)            any
failure by the Issuer to duly observe or perform in any material respect any covenant or agreement made in this Indenture (other than
a covenant or agreement, a default in the observance or performance of which is elsewhere in this Section specifically dealt with),
which failure shall materially and adversely affect the rights of the Noteholders and shall continue or not be cured for a period of sixty
(60) days (or for such longer period not in excess of ninety (90) days as may be reasonably necessary to remedy such failure; provided
the Issuer notifies the Indenture Trustee that it is a breach of the type capable of remedy within ninety (90) days) after there shall
have been given, by registered or certified mail, to the Issuer by the Indenture Trustee or to the Issuer and the Indenture Trustee by
the Noteholders of at least 25% of the Outstanding Amount, a written notice specifying such default and requiring it to be remedied and
stating that such notice is a “Notice of Default” hereunder;

 

(iv)            any
representation or warranty of the Issuer made in this Indenture or in any certificate or other writing delivered pursuant hereto or in
connection herewith proving to have been incorrect in any material respect as of the time when the same shall have been made, which incorrect
statement shall materially and adversely affect the rights of the Noteholders and the circumstance or condition in respect of which such
misrepresentation or warranty was incorrect shall not have been eliminated or otherwise cured, for a period of sixty (60) days (or for
such longer period not in excess of ninety (90) days as may be reasonably necessary to remedy such incorrect statement; provided the Issuer
notifies the Indenture Trustee that it is a breach of the type capable of remedy within ninety (90) days) after there shall have been
given, by registered or certified mail, to the Issuer by the Indenture Trustee or to the Issuer and the Indenture Trustee by the Noteholders
of at least 25% of the Outstanding Amount, a written notice specifying such incorrect representation or warranty and requiring it to be
remedied and stating that such notice is a “Notice of Default” hereunder;

 

(v)            (A) the
filing of a decree or order for relief by a court having jurisdiction in the premises in respect of the Issuer or any substantial part
of its property in an involuntary case under any applicable federal or state bankruptcy, insolvency or other similar law now or hereafter
in effect, or appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official for the Issuer or for
any substantial part of its property, or ordering the winding-up or liquidation of the Issuer’s affairs, and such decree or order
shall remain unstayed and in effect for a period of ninety (90) consecutive days; or (B) the commencement by the Issuer of a voluntary
case under any applicable federal or state bankruptcy, insolvency or other similar law now or hereafter in effect, or the consent by the
Issuer to the entry of an order for relief in an involuntary case under any such law, or the consent by the Issuer to the appointment
of or taking possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official for the Issuer or for
any substantial part of its property, or the making by the Issuer of any general assignment for the benefit of creditors, or the failure
by the Issuer generally to pay its debts as such debts become due, or the taking of action by the Issuer in furtherance of any of the
foregoing;

 

    	 	23	 

     

    

 

provided,
however, that (A) if any delay or failure of performance referred to in clause (i) above shall have been caused by
Force Majeure or other similar occurrences, the grace period referred to in such clause shall be extended for an additional sixty (60)
days, (B) if any delay or failure of performance referred to in clause (ii) above shall have been caused by Force Majeure or
other similar occurrences, the grace period referred to in such clause shall be extended for an additional sixty (60) days and (C) if
any delay or failure of performance referred to in clause (iii) or (iv) above shall have been caused by Force Majeure or other
similar occurrences, the grace period referred to in such clause shall be extended for an additional sixty (60) days.

 

The Issuer shall deliver to a Responsible Officer of the Indenture
Trustee, within five (5) Business Days after learning of the occurrence thereof, written notice in the form of an Officer’s
Certificate of any event which with the giving of notice and the lapse of time would become an Event of Default under clause (iii) or
(iv) above, its status and what action the Issuer is taking or proposes to take with respect thereto.

 

Section 5.02. Acceleration of Maturity,
Rescission and Annulment.

 

(a)          If
an Event of Default should occur and be continuing, then and in every such case the Noteholders representing not less than a majority
of the Outstanding Amount or the Indenture Trustee, at the request or direction of the Noteholders of Notes representing not less than
a majority of the Outstanding Amount, may declare all the Notes to be immediately due and payable, by a notice in writing to the Issuer
(and to the Indenture Trustee if given by Noteholders), and upon any such declaration the unpaid principal amount of such Notes, together
with accrued and unpaid interest thereon through the date of acceleration, shall become immediately due and payable.

 

(b)           At
any time after such declaration of acceleration of maturity has been made and before a judgment or decree for payment of the money due
has been obtained by the Indenture Trustee as hereinafter in this Article provided, the Noteholders of Notes representing a majority
of the Outstanding Amount, by written notice to the Issuer and the Indenture Trustee, may rescind and annul such declaration and its consequences
if:

 

(i)          the
Issuer has paid or deposited with the Indenture Trustee a sum sufficient to pay:

 

(A)            all
payments of principal of and interest on all Notes and all other amounts that would then be due hereunder or upon such Notes if the Event
of Default giving rise to such acceleration had not occurred; and

 

    	 	24	 

     

    

 

(B)            all
sums paid or advanced by the Indenture Trustee hereunder and the reasonable compensation, expenses, disbursements and advances of the
Indenture Trustee and its agents and counsel; and

 

(ii)          all
Events of Default, other than the nonpayment of the principal of the Notes that has become due solely by such acceleration, have been
cured or waived as provided in Section 5.12.

 

No such rescission shall affect any subsequent default or impair any
right consequent thereto.

 

Section 5.03. Collection of Indebtedness
and Suits for Enforcement by Indenture Trustee.

 

(a)            The
Issuer covenants that if the Notes are accelerated following the occurrence of an Event of Default, the Issuer will, upon demand of the
Indenture Trustee, pay to it, for the benefit of the Noteholders, the whole amount then due and payable on such Notes for principal and
interest, with interest on the overdue principal and, to the extent payment at such rate of interest shall be legally enforceable, on
overdue installments of interest at the related Interest Rate and, in addition thereto, such further amount as shall be sufficient to
cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Indenture
Trustee and its agents and counsel.

 

(b)            In
case the Issuer shall fail forthwith to pay such amounts upon such demand, the Indenture Trustee, in its own name and as trustee of an
express trust, may institute a Proceeding for the collection of the sums so due and unpaid, and may prosecute such Proceeding to judgment
or final decree and may enforce the same against the Issuer or other obligor upon such Notes and collect in the manner provided by law
out of the property of the Issuer or other obligor upon such Notes, wherever situated, the monies adjudged or decreed to be payable.

 

(c)            If
an Event of Default occurs and is continuing, the Indenture Trustee may, as more particularly provided in Section 5.04, in its discretion,
proceed to protect and enforce its rights and the rights of the Noteholders, by such appropriate Proceedings as the Indenture Trustee
shall deem most effective to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in
this Indenture or in aid of the exercise of any power granted herein, or to enforce any other proper remedy or legal or equitable right
vested in the Indenture Trustee by this Indenture or by law.

 

(d)            In
case there shall be pending, relative to the Issuer or any other obligor upon the Notes or any Person having or claiming an ownership
interest in the Owner Trust Estate, Proceedings under Title 11 of the United States Code or any other applicable federal or state bankruptcy,
insolvency or other similar law, or in case a receiver, assignee or trustee in bankruptcy or reorganization, or liquidator, sequestrator
or similar official shall have been appointed for or taken possession of the Issuer or its property or such other obligor or Person, or
in case of any other comparable judicial Proceedings relative to the Issuer or other obligor upon the Notes, or to the creditors or property
of the Issuer or such other obligor, the Indenture Trustee, irrespective of whether the principal of any Notes shall then be due and payable
as therein expressed or by declaration or otherwise and irrespective of whether the Indenture Trustee shall have made any demand pursuant
to the provisions of this Section, shall be entitled and empowered, by intervention in such Proceedings or otherwise:

 

    	 	25	 

     

    

 

(i)            to
file and prove a claim or claims for the entire amount of principal and interest owing and unpaid in respect of the Notes and to file
such other papers or documents as may be necessary or advisable in order to have the claims of the Indenture Trustee (including any claim
for reasonable compensation to the Indenture Trustee and each predecessor Indenture Trustee, and their respective agents, attorneys and
counsel, and for reimbursement of all expenses and liabilities incurred, and all advances made, by the Indenture Trustee and each predecessor
Indenture Trustee, except as a result of negligence or bad faith) and of the Noteholders allowed in such Proceedings;

 

(ii)            unless
prohibited by applicable law and regulations, to vote on behalf of the Noteholders in any election of a trustee, a standby trustee or
Person performing similar functions in any such Proceedings;

 

(iii)            to
collect and receive any monies or other property payable or deliverable on any such claims and to distribute all amounts received with
respect to the claims of the Noteholders and of the Indenture Trustee on their behalf; and

 

(iv)            to
file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Indenture
Trustee or the Noteholders allowed in any Proceedings relative to the Issuer, its creditors and its property;

 

(v)            and
any trustee, receiver, liquidator, custodian or other similar official in any such Proceeding is hereby authorized by each of such Noteholders
to make payments to the Indenture Trustee and, in the event that the Indenture Trustee shall consent to the making of payments directly
to such Noteholders, to pay to the Indenture Trustee such amounts as shall be sufficient to cover reasonable compensation to the Indenture
Trustee, each predecessor Indenture Trustee and their respective agents, attorneys and counsel, and all other expenses and liabilities
incurred, and all advances made, by the Indenture Trustee and each predecessor Indenture Trustee except as a result of negligence or bad
faith.

 

(e)          Nothing
herein contained shall be deemed to authorize the Indenture Trustee to authorize or consent to or vote for or accept or adopt on behalf
of any Noteholder any plan of reorganization, arrangement, adjustment or composition affecting the Notes or the rights of any Noteholder
thereof or to authorize the Indenture Trustee to vote in respect of the claim of any Noteholder in any such proceeding except, as aforesaid,
to vote for the election of a trustee in bankruptcy or similar Person.

 

    	 	26	 

     

    

 

(f)          All
rights of action and of asserting claims under this Indenture, or under any of the Notes, may be enforced by the Indenture Trustee without
the possession of any of the Notes or the production thereof in any trial or other Proceedings relative thereto, and any such action or
Proceedings instituted by the Indenture Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment,
subject to the payment of the expenses, disbursements and compensation of the Indenture Trustee, each predecessor Indenture Trustee and
their respective agents and attorneys, shall be for the ratable benefit of the Noteholders.

 

(g)          In
any Proceedings brought by the Indenture Trustee (including any Proceedings involving the interpretation of any provision of this Indenture
to which the Indenture Trustee shall be a party), the Indenture Trustee shall be held to represent all the Noteholders, and it shall not
be necessary to make any Noteholder a party to any such Proceedings.

 

Section 5.04. Remedies, Priorities.

 

(a)          If
an Event of Default shall have occurred and be continuing, the Indenture Trustee may do one or more of the following (subject to Sections
5.02 and 5.05):

 

(i)            institute
Proceedings in its own name and/or as trustee of an express trust for the collection of all amounts then payable on the Notes or under
this Indenture with respect thereto, whether by declaration or otherwise, enforce any judgment obtained and collect from the Issuer and
any other obligor upon such Notes monies adjudged due;

 

(ii)            institute
Proceedings from time to time for the complete or partial foreclosure of this Indenture with respect to the Owner Trust Estate;

 

(iii)            exercise
any remedies of a secured party under the UCC and any other remedy available to the Indenture Trustee and take any other appropriate action
to protect and enforce the rights and remedies of the Indenture Trustee on behalf of the Noteholders under this Indenture; and

 

(iv)            sell
the Owner Trust Estate or any portion thereof or rights or interest therein, at one or more public or private sales called and conducted
in any manner permitted by law;

 

provided, however, that the Indenture Trustee may not sell or otherwise
liquidate the Owner Trust Estate following an Event of Default, unless (A) the Noteholders of 100% of the Outstanding Amount consent
thereto, (B) the proceeds of such sale or liquidation distributable to the Noteholders and Certificateholders are sufficient to discharge
in full all amounts then due and unpaid upon such Notes and Certificates for principal and interest or (C) the Indenture Trustee
determines that the Owner Trust Estate will not continue to provide sufficient funds for the payment of principal of and interest on the
Notes and Certificates as would have become due if the Notes and Certificates had not been declared due and payable, and the Indenture
Trustee obtains the consent of Noteholders of 100% of the Outstanding Amount. In determining such sufficiency or insufficiency with respect
to clause (B) and (C) above, the Indenture Trustee may, but need not, obtain, at the expense of the Issuer, and rely upon an
opinion of an Independent investment banking or accounting firm of national reputation as to the feasibility of such proposed action and
as to the sufficiency of the Owner Trust Estate for such purpose.

 

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(b)          If
the Indenture Trustee collects any money or property pursuant to this Article, it shall pay out the money or property in the following
order and priority:

 

(i)            on
a pro rata basis, to the Indenture Trustee, the Delaware Trustee and the Owner Trustee, any amounts due under the Trust Agreement or Section 6.07
hereof;

 

(ii)            to
the Servicer, for amounts due and unpaid in respect of Nonrecoverable Advances under the Sale and Servicing Agreement;

 

(iii)            to
the Servicer, for amounts due and unpaid in respect of the Total Servicing Fee under the Sale and Servicing Agreement;

 

(iv)            to
the Asset Representations Reviewer, any amounts due under the Asset Representations Review Agreement that were not previously paid;

 

(v)            to
the Noteholders of the Notes of each Class, the Note Interest Distributable Amount ratably in proportion to the Note Interest Distributable
Amount for each Class at their respective Interest Rates;

 

(vi)            to
the Noteholders of Class A-1 Notes, the Outstanding Amount of the Class A-1 Notes, until the Class A-1 Notes are paid in
full;

 

(vii)           to
the Noteholders of the Class A-2, Class A-3 and Class A-4 Notes, pro rata in proportion to the Outstanding Amount of each
such Class, until the Class A-2, Class A-3 and Class A-4 Notes are paid in full;

 

(viii)          to
the Certificate Distribution Account for distribution to the Certificateholders, the Certificate Interest Distributable Amount;

 

(ix)            to
the Certificate Distribution Account for distribution to the Certificateholders, the outstanding principal amount of the Trust Certificates;
and

 

(x)            to
the Seller, any remaining amount.

 

The Indenture Trustee may fix a record date and payment date for any
payment to Noteholders pursuant to this Section. At least fifteen (15) days before such record date, the Issuer shall mail to each Noteholder
and the Indenture Trustee a notice that states the record date, the payment date and the amount to be paid.

 

Section 5.05. Optional Preservation of
the Receivables. If the Notes have been declared to be due and payable under Section 5.02 following an Event of Default and such
declaration and its consequences have not been rescinded and annulled, the Indenture Trustee may, but need not, elect to maintain possession
of the Owner Trust Estate. It is the desire of the parties hereto and the Noteholders that there be at all times sufficient funds for
the payment of any principal of and interest on the Notes, and the Indenture Trustee shall take such desire into account when determining
whether or not to maintain possession of the Owner Trust Estate. In determining whether to maintain possession of the Owner Trust Estate,
the Indenture Trustee may, but need not, obtain, at the expense of the Issuer, and rely upon an opinion of an Independent investment banking
or accounting firm of national reputation as to the feasibility of such proposed action and as to the sufficiency of the Owner Trust Estate
for such purpose.

 

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Section 5.06. Limitation of Suits.
No Noteholder shall have any right to institute any Proceeding, judicial or otherwise, with respect to this Indenture, or for the appointment
of a receiver or trustee, or for any other remedy hereunder, unless:

 

(i)            such
Noteholder has previously given written notice to the Indenture Trustee of a continuing Event of Default;

 

(ii)            the
Event of Default arises from the failure to remit payments when due or the Noteholders of not less than 25% of the Outstanding Amount
have made written request to the Indenture Trustee to institute such Proceeding in respect of such Event of Default in its own name as
Indenture Trustee hereunder;

 

(iii)           such
Noteholder or Noteholders have offered to the Indenture Trustee reasonable indemnity against the costs, expenses and liabilities to be
incurred in complying with such request;

 

(iv)           the
Indenture Trustee for sixty (60) days after its receipt of such notice, request and offer of indemnity has failed to institute such Proceedings;
and

 

(v)            no
direction inconsistent with such written request has been given to the Indenture Trustee during such 60-day period by the Noteholders
of a majority of the Outstanding Amount.

 

It is understood and intended that no one or more Noteholders shall
have any right in any manner whatever by virtue of, or by availing of, any provision of this Indenture to affect, disturb or prejudice
the rights of any other Noteholders or to obtain or to seek to obtain priority or preference over any other Noteholders or to enforce
any right under this Indenture, except in the manner herein provided.

 

In the event the Indenture Trustee shall receive conflicting or inconsistent
requests and indemnity from two or more groups of Noteholders, each representing less than a majority of the Outstanding Amount, the Indenture
Trustee in its sole discretion may determine what action, if any, shall be taken, notwithstanding any other provisions of this Indenture.
The Indenture Trustee shall not be liable for any such determination made in good faith.

 

Section 5.07. Unconditional Rights of Noteholders
to Receive Principal and Interest. Notwithstanding any other provisions in this Indenture, the Noteholder of any Note shall have the
right, which is absolute and unconditional, to receive payment of the principal of and interest, if any, on such Note on or after the
respective due dates thereof expressed in such Note or in this Indenture (or, in the case of redemption, on or after the Redemption Date)
and to institute suit for the enforcement of any such payment, and such right shall not be impaired without the consent of such Noteholder.

 

Section 5.08. Restoration of Rights and
Remedies. If the Indenture Trustee or any Noteholder has instituted any Proceeding to enforce any right or remedy under this Indenture
and such Proceeding has been discontinued or abandoned for any reason or has been determined adversely to the Indenture Trustee or to
such Noteholder, then and in every such case the Issuer, the Indenture Trustee and the Noteholders shall, subject to any determination
in such Proceeding, be restored severally and respectively to their former positions hereunder, and thereafter all rights and remedies
of the Indenture Trustee and the Noteholders shall continue as though no such Proceeding had been instituted.

 

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Section 5.09. Rights and Remedies Cumulative.
No right or remedy herein conferred upon or reserved to the Indenture Trustee or to the Noteholders is intended to be exclusive of any
other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other
right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right
or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy.

 

Section 5.10. Delay or Omission Not a Waiver.
No delay or omission of the Indenture Trustee or any Noteholder of any Note to exercise any right or remedy accruing upon any Default
or Event of Default shall impair any such right or remedy or constitute a waiver of any such Default or Event of Default or an acquiescence
therein. Every right and remedy given by this Article or by law to the Indenture Trustee or to the Noteholders may be exercised from
time to time, and as often as may be deemed expedient, by the Indenture Trustee or by the Noteholders, as the case may be.

 

Section 5.11. Control by Noteholders.
The Noteholders of Notes representing a majority of the Outstanding Amount shall have the right to direct the time, method and place of
conducting any Proceeding for any remedy available to the Indenture Trustee with respect to the Notes or exercising any trust or power
conferred on the Indenture Trustee; provided that:

 

(i)            such
direction shall not be in conflict with any rule of law or with this Indenture;

 

(ii)            subject
to the terms of Section 5.04, any direction to the Indenture Trustee to sell or liquidate the Owner Trust Estate shall be by the
Noteholders of Notes representing not less than 100% of the Outstanding Amount;

 

(iii)           if
the conditions set forth in Section 5.05 have been satisfied and the Indenture Trustee elects to retain the Owner Trust Estate pursuant
to such Section, then any direction to the Indenture Trustee by the Noteholders of Notes representing less than 100% of the Outstanding
Amount to sell or liquidate the Owner Trust Estate shall be of no force and effect; and

 

(iv)           the
Indenture Trustee may take any other action deemed proper by the Indenture Trustee that is not inconsistent with such direction.

 

Notwithstanding the rights of Noteholders set forth in this Section,
subject to Section 6.01, the Indenture Trustee need not take any action for which it will not be adequately indemnified or might
materially adversely affect the rights of any Noteholders not consenting to such action.

 

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Section 5.12. Waiver of Past Defaults.
Prior to the declaration of the acceleration of the maturity of the Notes as provided in Section 5.02, the Noteholders of Notes of
not less than a majority of the Outstanding Amount may waive any past Default or Event of Default and its consequences except a Default
(i) in payment of principal of or interest on any of the Notes or (ii) in respect of a covenant or provision hereof which cannot
be modified or amended without the consent of each Noteholder. In the case of any such waiver, the Issuer, the Indenture Trustee and the
Noteholders shall respectively be restored to their former positions and rights hereunder; but no such waiver shall extend to any subsequent
or other Default or Event of Default or impair any right consequent thereto. Upon any such waiver, such Default shall cease to exist and
be deemed to have been cured and not to have occurred, and any Event of Default arising therefrom shall be deemed to have been cured and
not to have occurred, for every purpose of this Indenture.

 

Section 5.13. Undertaking for Costs.
All parties to this Indenture agree, and each Noteholder by such Noteholder’s acceptance thereof shall be deemed to have agreed,
that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this Indenture, or in any suit
against the Indenture Trustee for any action taken, suffered or omitted by it as Indenture Trustee, the filing by any party litigant in
such suit of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including
reasonable attorneys’ fees and reasonable expenses, against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the provisions of this Section shall not apply to (i) any
suit instituted by the Indenture Trustee, (ii) any suit instituted by any Noteholder, or group of Noteholders, in each case holding
in the aggregate more than 10% of the Outstanding Amount or (iii) any suit instituted by any Noteholder for the enforcement of the
payment of principal of or interest on any Note on or after the respective due dates expressed in such Note and in this Indenture (or,
in the case of redemption, on or after the Redemption Date).

 

Section 5.14. Waiver of Stay or Extension
Laws. The Issuer covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, or plead or in any
manner whatsoever claim or take the benefit or advantage of, any stay or extension law wherever enacted, now or at any time hereafter
in force, that may affect the covenants or the performance of this Indenture; and the Issuer (to the extent that it may lawfully do so)
hereby expressly waives all benefit or advantage of any such law, and covenants that it will not hinder, delay or impede the execution
of any power herein granted to the Indenture Trustee, but will suffer and permit the execution of every such power as though no such law
had been enacted.

 

Section 5.15. Action on Notes. The
Indenture Trustee’s right to seek and recover judgment on the Notes or under this Indenture shall not be affected by the seeking,
obtaining or application of any other relief under or with respect to this Indenture. Neither the lien of this Indenture nor any rights
or remedies of the Indenture Trustee or the Noteholders shall be impaired by the recovery of any judgment by the Indenture Trustee against
the Issuer or by the levy of any execution under such judgment upon any portion of the Owner Trust Estate or upon any of the assets of
the Issuer. Any money or property collected by the Indenture Trustee shall be applied in accordance with Section 5.04(b).

 

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Section 5.16. Performance and Enforcement
of Certain Obligations.

 

(a)          Promptly
following a request from the Indenture Trustee to do so and at the Administrator’s expense, the Issuer shall take all such lawful
action as the Indenture Trustee may request to compel or secure the performance and observance by the Seller or the Servicer, as applicable,
of each of their obligations to the Issuer under or in connection with the Sale and Servicing Agreement in accordance with the terms thereof,
and to exercise any and all rights, remedies, powers and privileges lawfully available to the Issuer under or in connection with the Sale
and Servicing Agreement to the extent and in the manner directed by the Indenture Trustee, including the transmission of notices of default
on the part of the Seller or the Servicer thereunder and the institution of legal or administrative actions or proceedings to compel or
secure performance by the Seller or the Servicer of each of their obligations under the Sale and Servicing Agreement.

 

(b)          If
an Event of Default has occurred and is continuing, the Indenture Trustee may, and at the direction (which direction shall be in writing)
of the Noteholders of at least 66 2/3% of the Outstanding Amount shall, exercise all rights, remedies, powers, privileges and claims of
the Issuer against the Seller or the Servicer under or in connection with the Sale and Servicing Agreement, including the right or power
to take any action to compel or secure performance or observance by the Seller or the Servicer, as applicable, of each of their obligations
to the Issuer thereunder and to give any consent, request, notice, direction, approval, extension or waiver under the Sale and Servicing
Agreement, as applicable, and any right of the Issuer to take such action shall be suspended.

 

ARTICLE VI

 

THE INDENTURE TRUSTEE

 

Section 6.01. Duties of Indenture Trustee.

 

(a)          If
an Event of Default has occurred and is continuing of which a Responsible Officer of the Indenture Trustee has actual knowledge, the Indenture
Trustee shall exercise the rights and powers vested in it by this Indenture and use the same degree of care and skill in their exercise
as a prudent person would exercise or use under the circumstances in the conduct of such person’s own affairs; provided, however,
that if the Indenture Trustee shall assume the duties of the Servicer pursuant to Section 3.07(e), the Indenture Trustee in performing
such duties shall use the degree of care and skill customarily exercised by a prudent institutional servicer with respect to installment
sale contracts that it services for itself or others.

 

(b)          Except
during the continuance of an Event of Default of which a Responsible Officer of the Indenture Trustee has actual knowledge:

 

(i)            the
Indenture Trustee shall undertake to perform such duties and only such duties as are specifically set forth in this Indenture and no implied
covenants or obligations shall be read into this Indenture against the Indenture Trustee; and

 

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(ii)            in
the absence of bad faith on its part, the Indenture Trustee may conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions furnished to the Indenture Trustee and conforming to the requirements
of this Indenture; however, the Indenture Trustee shall examine the certificates and opinions specifically required to be furnished pursuant
to any provision of this Indenture to determine whether or not they conform to the requirements of this Indenture.

 

(c)          The
Indenture Trustee may not be relieved from liability for its own negligent action, its own negligent failure to act or its own willful
misconduct, except that:

 

(i)            this
paragraph does not limit the effect of Section 6.01(b);

 

(ii)            the
Indenture Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer unless it is proved that the
Indenture Trustee was negligent in ascertaining the pertinent facts; and

 

(iii)            the
Indenture Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 5.11.

 

(d)          Every
provision of this Indenture that in any way relates to the Indenture Trustee is subject to paragraphs (a), (b) and (c) of this
Section.

 

(e)          The
Indenture Trustee shall not be liable for interest on any money received by it except as the Indenture Trustee may agree in writing with
the Issuer.

 

(f)          Money
held in trust by the Indenture Trustee need not be segregated from other funds except to the extent required by law or the terms of this
Indenture or the Sale and Servicing Agreement.

 

(g)          No
provision of this Indenture shall require the Indenture Trustee to expend or risk its own funds or otherwise incur financial liability
in the performance of any of its duties hereunder or in the exercise of any of its rights or powers, if it shall have reasonable grounds
to believe that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.

 

(h)          Every
provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Indenture Trustee shall
be subject to the provisions of this Section and to the provisions of the TIA.

 

(i)          The
Indenture Trustee shall not be charged with knowledge of any Event of Default or any breach of a representation or warranty, as made in
the Receivables Purchase Agreement, unless either (i) a Responsible Officer shall have actual knowledge of such Event of Default
or breach, as applicable, or (ii) written notice of such Event of Default, or breach, as applicable, shall have been received by
a Responsible Officer of the Indenture Trustee in accordance with the provisions of this Indenture. The receipt by the Indenture Trustee
of a Review Report shall not obligate the Indenture Trustee to exercise its rights to enforce repurchase obligations under the Receivables
Purchase Agreement unless the Indenture Trustee is directed to do so by a Noteholder or Note Owner.

 

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(j)            The
Indenture Trustee shall have no duty (A) to see to any recording, filing, or depositing of this Indenture or any agreement referred
to herein or any financing statement or continuation statement evidencing a security interest, or to see to the maintenance of any such
recording or filing or depositing or to any rerecording, refiling or redepositing of any thereof, (B) to see to any insurance, (C) to
see to the payment or discharge of any tax, assessment, or other governmental charge or any lien or encumbrance of any kind owing with
respect to, assessed or levied against, any part of the Owner Trust Estate, or (D) to confirm or verify the contents of any reports
or certificates of the Servicer delivered to the Indenture Trustee pursuant to this Indenture believed by the Indenture Trustee to be
genuine and to have been signed or presented by the proper party or parties.

 

Section 6.02. Rights of Indenture Trustee.

 

(a)            Except
as otherwise provided in the second succeeding sentence, the Indenture Trustee may conclusively rely on, and shall be protected in acting
or refraining from acting upon, any resolution, Officer’s Certificate, Opinion of Counsel, certificate of auditors, Independent
Certificate or any other document believed by it to be genuine and to have been signed or presented by the proper person. The Indenture
Trustee need not investigate any fact, calculation or matter stated in the document. Notwithstanding the foregoing, the Indenture Trustee,
upon receipt of all resolutions, certificates, statements, opinions, reports, documents, orders or other instruments furnished to the
Indenture Trustee that shall be specifically required to be furnished pursuant to any provision of this Indenture, shall examine them
to determine whether they comply as to form to the requirements of this Indenture.

 

(b)            Before
the Indenture Trustee acts or refrains from acting, it may require an Officer’s Certificate or an Opinion of Counsel. The Indenture
Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on an Officer’s Certificate or Opinion
of Counsel.

 

(c)            The
Indenture Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents
or attorneys or a custodian or nominee, and the Indenture Trustee shall not be responsible for any misconduct or negligence on the part
of, or for the supervision of, any such agent, attorney, custodian or nominee appointed with due care by it hereunder.

 

(d)            The
Indenture Trustee shall not be liable for any action it takes or omits to take in good faith which it believes to be authorized or within
its rights or powers; provided, that the Indenture Trustee’s conduct does not constitute willful misconduct, negligence or bad faith.

 

(e)            The
Indenture Trustee may consult with counsel, and the advice or opinion of counsel with respect to legal matters relating to this Indenture
and the Notes shall be full and complete authorization and protection from liability in respect to any action taken, omitted or suffered
by it hereunder in good faith and in accordance with the advice or opinion of such counsel.

 

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(f)            The
Indenture Trustee shall be under no obligation to exercise any of the trusts or powers vested in it by this Indenture or to institute,
conduct or defend any litigation hereunder or in relation hereto at the request, order or direction of any of the Noteholders, pursuant
to the provisions of this Indenture, other than requests, demands or directions relating to an asset representations review pursuant to
Section 7.05, unless such Noteholders shall have offered to the Indenture Trustee security or indemnity reasonably satisfactory
to the Indenture Trustee against the costs, expenses and liabilities which may be incurred therein or thereby; provided, however, nothing
contained herein shall relieve the Indenture Trustee of the obligation, upon the occurrence of an Event of Default of which a Responsible
Officer of the Indenture Trustee shall have actual knowledge (which has not been cured), to exercise such of the rights and powers vested
in it by this Indenture, and to use the same degree of care and skill in their exercise, as a prudent person would exercise or use under
the circumstances in the conduct of such person’s own affairs.

 

(g)            The
right of the Indenture Trustee to perform any discretionary act enumerated in this Indenture shall not be construed as a duty, and the
Indenture Trustee shall not be answerable in the performance of such act for other than its negligence or willful misconduct.

 

(h)            The
Indenture Trustee shall not be required to give any bond or surety in respect of the execution of the Owner Trust Estate created hereby
or the powers granted hereunder.

 

(i)            All
rights of action and claims under this Indenture or the Note may be prosecuted and enforced by the Indenture Trustee without the possession
of any of the Notes or the production thereof in any proceeding relating thereto, any such proceeding instituted by the Indenture Trustee
shall be brought in its own name or in its capacity as Indenture Trustee. Any recovery of judgment shall, after provision for the payments
to the Indenture Trustee provided for in Section 6.07, be for the ratable benefit of the Noteholders in respect of which such judgment
has been recovered.

 

(j)            In
no event shall the Indenture Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder
arising out of or caused by, directly or indirectly, Force Majeure; it being understood that the Indenture Trustee shall use reasonable
efforts which are consistent with accepted practices in the banking industry to resume performances as soon as practicable under the circumstances.

 

(k)            The
Indenture Trustee shall not be obligated to monitor, supervise or enforce the performance of the Depositor or Sponsor under the Basic
Documents, except as otherwise expressly required herein or therein.

 

(l)            The
Indenture Trustee shall not be required to take any action it is directed to take under this Indenture if the Indenture Trustee reasonably
determines in good faith that the action so directed would involve the Indenture Trustee in personal liability or violate applicable law
binding upon it (which determination may be based on an Opinion of Counsel).

 

Section 6.03. Individual Rights of Indenture
Trustee. The Indenture Trustee in its individual or any other capacity may become the owner or pledgee of Notes and may otherwise
deal with the Issuer or its Affiliates with the same rights it would have if it were not Indenture Trustee. Any Paying Agent, Note Registrar,
co-registrar or co-paying agent may do the same with like rights. However, the Indenture Trustee must comply with Sections 6.11 and 6.12.

 

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Section 6.04. Indenture Trustee’s
Disclaimer. The Indenture Trustee shall not be responsible for and makes no representation as to the validity or adequacy of this
Indenture, the Owner Trust Estate or the Notes, it shall not be accountable for the Issuer’s use of the proceeds from the Notes,
and it shall not be responsible for any statement of the Issuer in this Indenture or in any document issued in connection with the sale
of the Notes or in the Notes other than the Indenture Trustee’s certificate of authentication. The Indenture Trustee shall have
no responsibility for filing any financing or continuation statement in any public office at any time or to otherwise perfect or maintain
the perfection of any security interest or lien granted to it hereunder or to record this Indenture.

 

Section 6.05. Notice of Defaults. If
a Default occurs and is continuing and if it is known to a Responsible Officer of the Indenture Trustee, the Indenture Trustee shall mail
to each Noteholder notice of the Default within ninety (90) days after it occurs. Except in the case of a Default in payment of principal
of or interest on any Note (including payments pursuant to the mandatory redemption provisions of such Note), the Indenture Trustee may
withhold the notice if and so long as a committee of its Responsible Officers in good faith determines that withholding the notice is
in the interests of Noteholders.

 

Section 6.06. Reports by Indenture Trustee
to Noteholders. The Indenture Trustee shall make available to each Noteholder such information as may be required to enable each Noteholder
to prepare its respective U.S. federal and state income tax returns. The Indenture Trustee will make documents or information which it
is required to provide available to the Noteholders, including, without limitation, the Servicer’s Certificate, and the Indenture
Trustee will post at https://pivot.usbank.com information regarding principal and interest due and paid on the Notes. The Indenture Trustee
shall have the right to change the way such statements are distributed in order to make such distribution more convenient and/or more
accessible to the above parties and the Indenture Trustee shall provide timely and adequate notification to all above parties regarding
any such changes; provided, however, that the Indenture Trustee will also mail copies of any such statements to any Noteholders who so
request in writing.

 

Section 6.07. Compensation and Indemnity.
The Issuer shall, or shall cause the Administrator to, (i) pay to the Indenture Trustee from time to time reasonable compensation
for its services, which compensation shall not be limited by any law on compensation of a trustee of an express trust, (ii) reimburse
the Indenture Trustee for all reasonable out-of-pocket expenses incurred or made by it (including reasonable expenses incurred pursuant
to Section 7.05), including without limitation, costs of collection, in addition to the compensation for its services, which
expenses shall include the reasonable compensation and expenses, disbursements and advances of the Indenture Trustee’s agents, counsel,
accountants and experts and (iii) indemnify the Indenture Trustee and its officers, directors, employees and agents against any and
all loss, liability or expense (including reasonable attorneys’ fees and expenses) incurred by it in connection with the administration
of this trust and the performance of its duties hereunder (including any reasonable legal fees and expenses incurred by the Indenture
Trustee in connection with the enforcement of any indemnification or other obligation of the Issuer) not resulting from its own willful
misconduct, negligence or bad faith. The Indenture Trustee shall notify the Issuer and the Administrator promptly of any claim for which
it may seek indemnity. Failure by the Indenture Trustee to so notify the Issuer and the Administrator shall not relieve the Issuer or
the Administrator of its obligations hereunder. The indemnities contained in this Section 6.07 shall survive the resignation or removal
of the Indenture Trustee or the termination of this Indenture. Absent an Event of Default, in the event of any claim, action or proceeding
for which indemnity will be sought pursuant to this Section 6.07, the Indenture Trustee’s choice of legal counsel shall be
subject to the approval of the Depositor (or if the Depositor is no longer an owner, the designee of the Depositor), which approval shall
not be unreasonably withheld, conditioned, delayed or denied. Neither the Issuer nor the Administrator need reimburse any expense or indemnify
against any loss, liability or expense incurred by the Indenture Trustee (1) through the Indenture Trustee’s own willful misconduct,
negligence or bad faith or (2) in the case of the inaccuracy of any representation or warranty contained in Section 6.13 expressly
made by the Indenture Trustee.

 

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The Issuer’s payment obligations to the Indenture
Trustee pursuant to this Section shall survive the discharge of this Indenture and the resignation or discharge of the Indenture
Trustee and shall extend to any co-trustee or separate trustee appointed pursuant to Section 6.10 hereunder. When the Indenture Trustee
incurs expenses after the occurrence of a Default specified in Section 5.01 (iv) or (v) with respect to the Issuer, the
expenses are intended to constitute expenses of administration under Title 11 of the United States Code or any other applicable federal
or state bankruptcy, insolvency or similar law.

 

Anything in this Indenture to the contrary notwithstanding,
in no event shall the Indenture Trustee be liable for special, indirect or consequential loss or damage of any kind whatsoever (including
but not limited to lost profits, other than interest due but not paid on the Notes), even if the Indenture Trustee has been advised of
the likelihood of such loss or damage and regardless of the form of action.

 

Section 6.08. Replacement of Indenture
Trustee. No resignation or removal of the Indenture Trustee and no appointment of a successor Indenture Trustee shall become effective
until the acceptance of appointment by the successor Indenture Trustee pursuant to this Section. The Indenture Trustee may resign at any
time by so notifying the Issuer. Noteholders representing a majority of the Outstanding Amount may remove the Indenture Trustee at any
time (with thirty-one (31) days’ prior notice) and appoint a successor Indenture Trustee by so notifying the Indenture Trustee in
writing. The Issuer shall remove the Indenture Trustee (with thirty-one (31) days’ prior notice) if:

 

(i)            the
Indenture Trustee fails to comply with Section 6.11;

 

(ii)            a
court having jurisdiction in the premises in respect of the Indenture Trustee in an involuntary case or proceeding under federal or state
banking or bankruptcy laws, as now or hereafter constituted, or any other applicable federal or state bankruptcy, insolvency or other
similar law, shall have entered a decree or order granting relief or appointing a receiver, liquidator, assignee, custodian, trustee,
conservator, sequestrator (or similar official) for the Indenture Trustee or for any substantial part of the Indenture Trustee’s
property, or ordering the winding-up or liquidation of the Indenture Trustee’s affairs, provided any such decree or order shall
have continued unstayed and in effect for a period of thirty (30) consecutive days;

 

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(iii)            the
Indenture Trustee commences a voluntary case under any federal or state banking or bankruptcy laws, as now or hereafter constituted, or
any other applicable federal or state bankruptcy, insolvency or other similar law, or consents to the appointment of or taking possession
by a receiver, liquidator, assignee, custodian, trustee, conservator, sequestrator or other similar official for the Indenture Trustee
or for any substantial part of the Indenture Trustee’s property, or makes any assignment for the benefit of creditors or fails generally
to pay its debts as such debts become due or takes any corporate action in furtherance of any of the foregoing; or

 

(iv)            the
Indenture Trustee otherwise becomes incapable of acting.

 

If the Indenture Trustee resigns or is removed
or if a vacancy exists in the office of the Indenture Trustee for any reason (the Indenture Trustee in such event being referred to herein
as the retiring Indenture Trustee), the Issuer shall promptly appoint a successor Indenture Trustee.

 

A successor Indenture Trustee shall deliver a written
acceptance of its appointment to the retiring Indenture Trustee and to the Issuer. Thereupon the resignation or removal of the retiring
Indenture Trustee shall become effective, and the successor Indenture Trustee shall have all the rights, powers and duties of the Indenture
Trustee under this Indenture. The successor Indenture Trustee shall mail a notice of its succession to the Noteholders. The retiring Indenture
Trustee shall promptly transfer all property held by it as Indenture Trustee to the successor Indenture Trustee.

 

If a successor Indenture Trustee does not take
office within sixty (60) days after the retiring Indenture Trustee resigns or is removed, the retiring Indenture Trustee, the Issuer or
the Noteholders of a majority in Outstanding Amount may petition any court of competent jurisdiction for the appointment of a successor
Indenture Trustee.

 

If the Indenture Trustee fails to comply with Section 6.11,
any Noteholder may petition any court of competent jurisdiction for the removal of the Indenture Trustee and the appointment of a successor
Indenture Trustee.

 

Any resignation or removal of the Indenture Trustee
and appointment of a successor Indenture Trustee pursuant to the provisions of this Section shall not become effective until acceptance
of appointment by the successor Indenture Trustee pursuant to this Section and payment of all fees and expenses owed to the outgoing
Indenture Trustee. Notwithstanding the replacement of the Indenture Trustee pursuant to this Section, the Issuer’s and the Administrator’s
obligations under Section 6.07 shall continue for the benefit of the retiring Indenture Trustee.

 

Section 6.09. Successor Indenture Trustee
by Merger. If the Indenture Trustee consolidates or merges with, converts or transfers all or substantially all its corporate trust
business or assets to, another corporation or banking association, the resulting, surviving or transferee corporation shall, without any
further act, be the successor Indenture Trustee; provided, that such corporation or banking association shall be otherwise qualified and
eligible under Section 6.11. The Indenture Trustee shall provide the Administrator prior written notice of any such transaction,
and in accordance with Section 1.02(c) of the Administration Agreement, the Administrator will make such notice available to
each Rating Agency.

 

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In case at the time such successor or successors
by merger, conversion or consolidation to the Indenture Trustee shall succeed to the trusts created by this Indenture any of the Notes
shall have been authenticated but not delivered, any such successor to the Indenture Trustee may adopt the certificate of authentication
of any predecessor trustee and deliver such Notes so authenticated; and in case at that time any of the Notes shall not have been authenticated,
any successor to the Indenture Trustee may authenticate such Notes either in the name of any predecessor hereunder or in the name of the
successor to the Indenture Trustee; and in all such cases such certificates shall have the full force as is provided anywhere in the Notes
or in this Indenture that the certificate of the Indenture Trustee shall have.

 

Section 6.10. Appointment of Co-Trustee
or Separate Trustee.

 

(a)          Notwithstanding
any other provision of this Indenture, at any time, for the purpose of meeting any legal requirement of any jurisdiction in which any
part of the Owner Trust Estate may at the time be located, the Indenture Trustee and the Administrator, acting jointly, shall have the
power and may execute and deliver all instruments to appoint one or more Persons to act as a co-trustee or co-trustees, or separate trustee
or separate trustees, of all or any part of the Trust, and to vest in such Person or Persons, in such capacity and for the benefit of
the Noteholders, such title to the Owner Trust Estate or any part thereof, and, subject to the other provisions of this Section, such
powers, duties, obligations, rights and trusts as the Indenture Trustee may consider necessary or desirable. If the Administrator shall
not have joined in such appointment within fifteen (15) days after its receipt of a request to do so, the Indenture Trustee alone shall
have the power to make such appointment. No co-trustee or separate trustee hereunder shall be required to meet the terms of eligibility
as a successor trustee under Section 6.11 and no notice to Noteholders of the appointment of any co-trustee or separate trustee shall
be required under Section 6.08.

 

(b)          Every
separate trustee and co-trustee shall, to the extent permitted by law, be appointed and act subject to the following provisions and conditions:

 

(i)            all
rights, powers, duties and obligations conferred or imposed upon the Indenture Trustee shall be conferred or imposed upon and exercised
or performed by the Indenture Trustee and such separate trustee or co-trustee jointly (it being understood that such separate trustee
or co-trustee is not authorized to act separately without the Indenture Trustee joining in such act), except to the extent that under
any law of any jurisdiction in which any particular act or acts are to be performed the Indenture Trustee shall be incompetent or unqualified
to perform such act or acts, in which event such rights, powers, duties and obligations (including the holding of title to the Owner Trust
Estate or any portion thereof in any such jurisdiction) shall be exercised and performed singly by such separate trustee or co-trustee,
but solely at the direction of the Indenture Trustee;

 

(ii)            no
trustee hereunder shall be personally liable by reason of any act or omission of any other trustee hereunder; and

 

(iii)            the
Indenture Trustee and the Administrator may at any time accept the resignation of or remove any separate trustee or co-trustee.

 

    	 	39	 

     

    

 

(c)            Any
notice, request or other writing given to the Indenture Trustee shall be deemed to have been given to each of the then separate trustees
and co-trustees, as effectively as if given to each of them. Every instrument appointing any separate trustee or co-trustee shall refer
to this Indenture and the conditions of this Article. Each separate trustee and co-trustee, upon its acceptance of the trusts conferred,
shall be vested with the estates or property specified in its instrument of appointment, either jointly with the Indenture Trustee or
separately, as may be provided therein, subject to all the provisions of this Indenture, specifically including every provision of this
Indenture relating to the conduct of, affecting the liability of, or affording protection to, the Indenture Trustee. Every such instrument
shall be filed with the Indenture Trustee and a copy thereof given to the Administrator.

 

(d)            Any
separate trustee or co-trustee may at any time constitute the Indenture Trustee, its agent or attorney-in-fact with full power and authority,
to the extent not prohibited by law, to do any lawful act under or in respect of this Indenture on its behalf and in its name. If any
separate trustee or co-trustee shall die, become incapable of acting, resign or be removed, all of its estates, properties, rights, remedies
and trusts shall vest in and be exercised by the Indenture Trustee, to the extent permitted by law, without the appointment of a new or
successor trustee.

 

Section 6.11. Eligibility, Disqualification.
The Indenture Trustee shall at all times satisfy the requirements of TIA § 310(a). The Indenture Trustee shall have a combined capital
and surplus of at least $50,000,000 as set forth in its most recent published annual report of condition, and the time deposits of the
Indenture Trustee shall have a rating that is otherwise acceptable to the Rating Agencies, such that the rating of the Indenture Trustee,
the Owner Trustee or any other bank would not in and of itself result in a qualification, downgrade or withdrawal of any of the then-current
ratings assigned thereby to the Notes (as evidenced by written notice to the Indenture Trustee, Owner Trustee or any other bank). The
Indenture Trustee shall comply with TIA § 310(b); provided, however, that there shall be excluded from the operation of TIA §
310(b)(1) any indenture or indentures under which other securities of the Issuer are outstanding if the requirements for such exclusion
set forth in TIA § 310(b)(1) are met.

 

In the event that, (A) the Indenture Trustee
(i) or any of its directors or executive officers is an underwriter, or (ii) directly or indirectly, controls or is controlled
by, or is in common control with, an underwriter; and (B) an Event of Default occurs, the Indenture Trustee shall comply with TIA
 § 310(b). For this purpose only and pursuant to TIA § 310(b), an “underwriter” means any person who, within one
year prior to the occurrence of the Event of Default, was an underwriter of any of the notes outstanding at the time of such Event of
Default.

 

Section 6.12. Preferential Collection of
Claims Against Issuer. The Indenture Trustee shall comply with TIA § 311 (a), excluding any creditor relationship listed in TIA
 § 311(b). An Indenture Trustee who has resigned or been removed shall be subject to TIA § 31l(a) to the extent indicated.

 

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Section 6.13. Representations and Warranties
of Indenture Trustee. The Indenture Trustee hereby makes the following representations and warranties on which the Issuer and Noteholders
shall rely:

 

(i)            it
is a national banking association duly organized, validly existing and in good standing under the laws of the United States of America;

 

(ii)            it
has full power, authority and legal right to execute, deliver, and perform this Indenture and shall have taken all necessary action to
authorize the execution, delivery and performance by it of this Indenture;

 

(iii)            assuming
the necessary authorization, execution and delivery thereof by the other parties thereto, the duties and obligations of the Indenture
Trustee under the Indenture constitute the valid, legal and binding obligations of the Indenture Trustee enforceable in accordance with
its terms except as enforcement may be limited by bankruptcy, insolvency, reorganization or similar laws or equitable principles limiting
creditors’ rights generally, and provided that no representation is expressed as to the availability of equitable remedies;

 

(iv)            that
to the best knowledge of the Indenture Trustee, the Indenture Trustee is not in breach of or default under any law or administrative rule or
regulation of the United States of America, or any department, division, agency or instrumentality thereof, or any applicable court or
administrative decree or order, and which would materially impair the ability of the Indenture Trustee to perform its obligations under
the Indenture; and

 

(v)            that
to the best knowledge of the Indenture Trustee, no authorization, consent or other order of any state or federal government authority
or agency having jurisdiction over the trust powers of the Indenture Trustee are required to be obtained by the Indenture Trustee for
the valid authorization, execution and delivery by the Indenture Trustee of the Indenture or the authentication of the Notes.

 

ARTICLE VII

 

NOTEHOLDERS’ LISTS AND REPORTS

 

Section 7.01. Issuer to Furnish Indenture
Trustee Names and Addresses of Noteholders. If Definitive Notes are issued, the Issuer will furnish or cause to be furnished to the
Indenture Trustee (i) not more than five (5) days after the earlier of (a) each Record Date and (b) three months after
the last Record Date, a list, in such form as the Indenture Trustee may reasonably require, of the names and addresses of the Noteholders
as of such Record Date, and (ii) at such other times as the Indenture Trustee may request in writing, within thirty (30) days after
receipt by the Issuer of any such request, a list of similar form and content as of a date not more than ten (10) days prior to the
time such list is furnished; provided, however, that so long as the Indenture Trustee is the Note Registrar, no such list shall be required
to be furnished.

 

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Section 7.02. Preservation of Information;
Communications, Reports and Certain Documents to Noteholders.

 

(a)            The
Indenture Trustee shall preserve, in as current a form as is reasonably practicable, the names and addresses of the Noteholders contained
in the most recent list furnished to the Indenture Trustee as provided in Section 7.01 and the names and addresses of Noteholders
received by the Indenture Trustee in its capacity as Note Registrar. The Indenture Trustee may destroy any list furnished to it as provided
in such Section 7.01 upon receipt of a new list so furnished.

 

(b)            Noteholders
may communicate pursuant to TIA § 312(b) with other Noteholders with respect to their rights under this Indenture or under the
Notes. A Noteholder or Note Owner, as applicable, that seeks to communicate with other Noteholders or Note Owners, as applicable, about
the exercise of Noteholder and Note Owner rights under this Indenture or the other Basic Documents may send a request to the Issuer or
the Servicer to include information regarding the communication in the Form 10-D to be filed by the Servicer, on behalf of the Issuer,
with the Securities and Exchange Commission relating to the Collection Period in which such request was received. Each request must include
(i) the name of the requesting Noteholder or Note Owner, (ii) the method by which the other Noteholders or Note Owners, as applicable,
may contact the requesting Noteholder or Note Owner and (iii) in the case of a Note Owner, a certification from that Note Owner that
it is a Note Owner, together with at least one form of documentation, acceptable to the Indenture Trustee, evidencing its ownership of
a Note, including, but not limited to, a trade confirmation, account statement, letter from a broker or dealer or other similar document.
On receipt of such a request, the Servicer will include in the Form 10-D to be filed (i) a statement that the Issuer has received
a request from a Noteholder or a Note Owner, as applicable, that is interested in communicating with other Noteholders or Note Owners,
as applicable, about a possible exercise of rights under this Indenture or the other Basic Documents, (ii) the name of the requesting
Noteholder or Note Owner, (iii) the date the request was received and (iv) a description of the date and method by which the
other Noteholders or Note Owners, as applicable, may contact the requesting Noteholder or Note Owner.

 

(c)            The
Issuer, the Indenture Trustee and the Note Registrar shall have the protection of TIA § 312(c).

 

(d)            The
Indenture Trustee will provide to Securityholders the reports, certificates, opinions and documents specified in Section 3.15 of
the Sale and Servicing Agreement, upon written request to the Indenture Trustee.

 

(e)            The
Indenture Trustee shall, no later than the third Business Day after the last day of each calendar month, provide notice to American Honda
Finance Corporation and American Honda Receivables LLC (each, a “Honda Party,” and together, the “Honda Parties”)
in the form set forth as Exhibit E hereto (or such other form or format as the Honda Parties may otherwise specify) of the
request or any requests of (i) all demands communicated to the Indenture Trustee for the repurchase or replacement of any Receivable
for breach of the representations and warranties concerning such Receivable relating to the Issuer and (ii) any actions taken by
the Indenture Trustee with respect to such demand communicated to the Indenture Trustee in respect of any Receivables. In addition, the
Indenture Trustee shall, upon written request of either Honda Party, at any time they reasonably feel necessary, provide notification
to the Honda Parties with respect to any actions taken by the Indenture Trustee as soon as practicable and in any event within five (5) Business
Days of receipt of such request. Such notices shall be provided to the Honda Parties in accordance with Section 11.04(iv) of
this Indenture. The Indenture Trustee and the Issuer acknowledge and agree that the purpose of this Section 7.02(e) is to facilitate
compliance by the Honda Parties with Rule 15Ga-1 under the Securities Exchange Act of 1934, as amended, and Items 1104(e), 1121(c) and
1125 of Regulation AB (the “Repurchase Rules and Regulations”). The Indenture Trustee acknowledges that interpretations
of the requirements of the Repurchase Rules and Regulations may change over time, whether due to interpretive guidance provided by
the Commission or its staff, consensus among participants in the asset-backed securities markets, advice of counsel, or otherwise, and
agrees to comply with reasonable written requests (including email in PDF format) made by the Honda Parties in good faith for delivery
of information in its possession under these provisions on the basis of evolving interpretations of the Repurchase Rules and Regulations.
The Indenture Trustee shall cooperate fully with the Honda Parties to deliver any and all records and any other information in its possession
and necessary in the good faith determination of the Honda Parties to permit them to comply with the provisions of Repurchase Rules and
Regulations. In no event shall the Indenture Trustee have any responsibility or liability in connection with any filing required to be
made by a securitizer under the Repurchase Rules and Regulations.

 

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Section 7.03. Reports by Issuer.

 

(a)          The
Issuer shall:

 

(i)            deliver
to the Indenture Trustee, within fifteen (15) days after the Issuer is required to file the same with the Commission, copies of the annual
reports and the information, documents and other reports (or copies of such portions of any of the foregoing as the Commission may from
time to time by rules and regulations prescribe) that the Issuer may be required to deliver to the Commission pursuant to Section 13
or 15(d) of the Exchange Act;

 

(ii)            deliver
to the Indenture Trustee and the Commission in accordance with rules and regulations prescribed from time to time by the Commission
such additional information, documents and reports with respect to compliance by the Issuer with the conditions and covenants of this
Indenture as may be required from time to time by such rules and regulations; and

 

(iii)            supply
to the Indenture Trustee (and the Indenture Trustee shall transmit by mail to all Noteholders described in TIA § 313(c)) such summaries
of any information, documents and reports required to be filed by the Issuer pursuant to clauses (i) and (ii) of this Section 7.03(a) and
by rules and regulations prescribed from time to time by the Commission.

 

    	 	43	 

     

    

 

(b)            Unless
the Issuer otherwise determines, the fiscal year of the Issuer shall end on March 31 of each year.

 

Section 7.04. Reports by Indenture Trustee.
If required by TIA § 313(a), within sixty (60) days after each March 31st (commencing March 31st,
2022), the Indenture Trustee shall mail to each Noteholder as required by TIA § 313(c) a brief report dated as of such date
that complies with TIA § 313(a). The Indenture Trustee also shall comply with TIA § 313(b).

 

A copy of each report at the time of its mailing
to Noteholders shall be filed by the Indenture Trustee with the Commission and each stock exchange, if any, on which the Notes are listed.
The Issuer shall promptly notify the Indenture Trustee in writing if and when the Notes are listed on any stock exchange and of any delisting
thereof.

 

Section 7.05.
Noteholder and Note Owner Demand for Asset Representations Review. If the Delinquency Percentage on any Payment Date meets
or exceeds the Delinquency Trigger for that Payment Date, the Servicer shall notify the Noteholders and Note Owners on the Form 10-D
filed for that Payment Date. On or after such Payment Date, an Investor may make a demand on the Indenture Trustee, in accordance with
Section 11.03 to cause a vote of the Investors about whether to direct the Asset Representations Reviewer to conduct an Asset
Representations Review under the Asset Representations Review Agreement. The Servicer shall notify Investors of the initiation of such
a vote on the Form 10-D filed for that Payment Date. If Investors of at least 5% in the aggregate of the Outstanding Amount of the
Notes, as of the filing of the Form 10-D that disclosed that the Delinquency Trigger was met or exceeded, demand a vote within ninety
(90) days after the filing of the Form 10-D in which the occurrence of the Delinquency Trigger being met or exceeded was reported,
the Indenture Trustee, in accordance with its standard internal vote solicitation process, will promptly request a vote of the Noteholders
(through the Clearing Agency) and Note Owners. The Indenture Trustee shall set a record date for purposes of determining the identity
of Noteholders or Note Owners, as applicable, entitled to vote in accordance with TIA Section 316(c) as of the date of filing
of the Form 10-D that disclosed that the Delinquency Trigger was met or exceeded. The vote will be initiated no later than ninety
(90) days after the filing of the Form 10-D reporting that the Delinquency Percentage met or exceeded the Delinquency Trigger for
that Payment Date and will remain open until one hundred fifty (150) days after such Form 10-D filing. The Servicer shall pay the
costs, expenses and liabilities incurred by the Indenture Trustee, the Owner Trustee and the Issuer in connection with the voting process,
including the costs and expenses of counsel to such parties. If the Investors of a majority of the Outstanding Amount of Notes (out of
those that are voted) vote in favor of an Asset Representations Review, the Indenture Trustee will promptly notify the Asset Representations
Reviewer, the Issuer, the RPA Seller, the Administrator and the Servicer of such vote. Following the completion of the voting process,
the next Form 10-D filed by the Depositor will disclose whether or not the Noteholders and Note Owners have voted for an Asset Representations
Review.

 

Section 7.06. Voting of Notes Held by Honda
Parties. If any of the Notes are held by any of the Honda Parties or any of their Affiliates, such Notes shall not be considered for
purposes of determining whether a specified percentage of the Outstanding Amount has voted to take any action under this Indenture or
any other Basic Document.

 

    	 	44	 

     

    

 

ARTICLE VIII

 

ACCOUNTS, DISBURSEMENTS AND RELEASES

 

Section 8.01. Collection of Money.
Except as otherwise expressly provided herein, the Indenture Trustee may demand payment or delivery of, and shall receive and collect,
directly and without intervention or assistance of any fiscal agent or other intermediary, all money and other property payable to or
receivable by the Indenture Trustee pursuant to this Indenture. The Indenture Trustee shall apply all such money received by it as provided
in this Indenture. Except as otherwise expressly provided in this Indenture, if any default occurs in the making of any payment or performance
under any agreement or instrument that is part of the Owner Trust Estate, the Indenture Trustee may take such action as may be appropriate
to enforce such payment or performance, including the institution and prosecution of appropriate Proceedings. Any such action shall be
without prejudice to any right to claim a Default or Event of Default under this Indenture and any right to proceed thereafter as provided
in Article V.

 

Section 8.02. Accounts.

 

(a)          Pursuant
to Section 4.01 of the Sale and Servicing Agreement, there has been established and there shall be maintained an Eligible Account
(initially at the Securities Intermediary) in the name, and under the sole dominion and control, of the Indenture Trustee until the Outstanding
Amount has been reduced to zero, and thereafter, in the name, and under the sole dominion and control, of the Owner Trustee, which is
designated as the Yield Supplement Account.

 

(b)          On
or prior to the Closing Date, the Issuer shall cause the Servicer to establish and maintain, in the name of the Indenture Trustee, Eligible
Accounts for the benefit of the (i) Securityholders, the Collection Account, the Yield Supplement Account and the Reserve Fund and
(ii) Noteholders, the Note Distribution Account as provided in Section 4.01 of the Sale and Servicing Agreement.

 

(c)          On
or before each Payment Date, with respect to the preceding Collection Period, all amounts required to be deposited in the Collection Account
will be deposited as provided in Sections 4.02 and 4.05 of the Sale and Servicing Agreement. On or before each Payment Date, all amounts
required to be deposited in the Note Distribution Account with respect to the preceding Collection Period pursuant to Sections 4.06 and
4.07 of the Sale and Servicing Agreement will be transferred from the Collection Account, the Reserve Fund and/or the Yield Supplement
Account to the Note Distribution Account.

 

(d)          On
each Payment Date and Redemption Date, the Indenture Trustee shall distribute all amounts on deposit in the Note Distribution Account
to Noteholders, in respect of the Notes to the extent of amounts due and unpaid on the Notes for principal and interest (including any
premium), in the amounts and order as set forth in the Servicer’s Certificate which shall be in the following amounts and in the
following order of priority (except as otherwise provided in Section 5.04(b)):

 

(i)            the
Note Interest Distributable Amount; provided, that if there are not sufficient funds in the Note Distribution Account to pay the allocable
portion of the Note Interest Distribution Amount with respect to each Class of Notes, the amount in the Note Distribution Account
shall be applied to the payment of such amount pro rata on the basis of the total Note Interest Distributable Amount due on the Notes;

 

    	 	45	 

     

    

 

(ii)            the
Note Principal Distributable Amount (first to the Class A-1 Notes until the Class A-1 Notes are paid in full, second to the
Class A-2 Notes until paid in full, third to the Class A-3 Notes until paid in full, and fourth to the Class A-4 Notes
until paid in full);

 

(iii)            notwithstanding
clause (ii) above, on each Payment Date after the Notes have been accelerated as provided in Section 5.02(a) following
the occurrence of an Event of Default, until such time as the Notes have been paid in full, the Note Principal Distributable Amount shall
be paid first to the Class A-1 Notes until the Class A-1 Notes are paid in full and then to the Class A-2, Class A-3
and Class A-4 Notes on a pro rata basis based on the Outstanding Amount of each such Class of Notes; and

 

(iv)            in
the event that there are insufficient funds in the Note Distribution Account, an amount will be withdrawn from the Reserve Fund pursuant
to Section 4.07(b) of the Sale and Servicing Agreement.

 

The Indenture Trustee shall, subject to Article VI,
make the distributions on the Notes in a manner consistent with the Servicer’s Certificate and will, upon the request of the Issuer,
confirm to the Issuer that it has made such payments in accordance with the Servicer’s Certificate.

 

(e)          The
Securities Intermediary.

 

(i)            U.S.
Bank is hereby appointed as the initial securities intermediary with respect to the Collection Account, the Yield Supplement Account and
the Reserve Fund (the “Securities Intermediary”) and U.S. Bank hereby accepts such appointment as Securities Intermediary.
The Securities Intermediary hereby agrees with the parties hereto that the jurisdiction of the Securities Intermediary with respect to
the Collection Account, the Yield Supplement Account and the Reserve Fund shall be the State of New York. The Securities Intermediary
hereby represents and covenants that it is not and will not be (as long as it is the Securities Intermediary hereunder) a party to any
agreement that is inconsistent with the provisions of this Indenture. The Securities Intermediary hereby agrees that any item of property
credited to the Collection Account, the Yield Supplement Account or the Reserve Fund shall not be subject to any security interest, lien,
encumbrance or right of setoff in favor of the Securities Intermediary or anyone claiming through the Securities Intermediary (other than
the Indenture Trustee).

 

    	 	46	 

     

    

 

(ii)          It
is the intent of the Indenture Trustee and the Issuer that each of the Collection Account, the Yield Supplement Account and the Reserve
Fund shall be a securities account of the Indenture Trustee and not an account of the Issuer. In furtherance thereof, the Securities Intermediary
agrees to comply with entitlement orders with respect to and with instructions directing the disposition of funds held in or credited
to the Collection Account, the Yield Supplement Account and the Reserve Fund originated by the Indenture Trustee without further consent
by the Issuer, the Servicer or any other person or entity. The Securities Intermediary hereby covenants that it will not agree with any
person or entity other than the Indenture Trustee, the Issuer and the Servicer that it will comply with entitlement orders originated
by any person or entity, or instructions regarding the disposition of funds, with respect to such Accounts other than the Indenture Trustee,
the Issuer and the Servicer. The Securities Intermediary hereby agrees (A) to treat all Account Property as Financial Assets, and
(B) that all Account Property will be physically delivered to (accompanied by any required endorsements) to, or credited to an account
in the name of, the Securities Intermediary in accordance with the Securities Intermediary’s customary procedures such that the
Securities Intermediary establishes a Security Entitlement in favor of the Indenture Trustee with respect thereto over which the Indenture
Trustee has Control.

 

(iii)          Any
successor Securities Intermediary shall be required to make the same representations and covenants as set forth above in clauses (i) and
(ii).

 

(iv)          Nothing
herein shall imply or impose upon the Securities Intermediary any duties or obligations other than those expressly set forth herein and
those applicable to a securities intermediary under the UCC (and the Securities Intermediary shall be entitled to all of the protections
available to a securities intermediary under the UCC). Without limiting the foregoing, nothing herein shall imply or impose upon the Securities
Intermediary any duties of a fiduciary nature (such as the fiduciary duties of the Indenture Trustee hereunder).

 

(v)          The
rights and powers granted herein to the Indenture Trustee, and the covenants and obligations of the Securities Intermediary hereunder,
have been granted in order to perfect the Indenture Trustee’s security interest in the Collection Account, the Yield Supplement
Account and the Reserve Fund, and such rights, powers, covenants and obligations hereunder shall continue in effect with respect to the
Collection Account, the Yield Supplement Account and the Reserve Fund until the Outstanding Amount of the Notes has been reduced to zero.

 

(vi)          The
Indenture Trustee, to the extent it is acting in the capacity as Securities Intermediary with respect to the Accounts, represents, warrants
and covenants that:

 

(A)            it
is a “securities intermediary,” as such term is defined in Section 8-102(a)(14)(B) of the relevant UCC;

 

(B)            pursuant
to Section 8-110(e)(1) of the relevant UCC for purposes of the relevant UCC, the jurisdiction of the Securities Intermediary
is the law of the State of New York; and

 

    	 	47	 

     

    

 

(C)            the
Securities Intermediary has and shall continue to have at all relevant times one or more offices in the United States of America engaged
in a business or other regular activity of maintaining securities accounts.

 

(vii)          To
the extent that there are any other agreements with the Indenture Trustee or the Securities Intermediary governing the Accounts, the parties
agree that each and every such agreement is hereby amended to provide that with respect to the Accounts, the law applicable to all issues
specified in Article 2(1) of the Hague Securities Convention shall be the laws of the State of New York.

 

Section 8.03. General Provisions Regarding
Accounts.

 

(a)            So
long as no Default or Event of Default shall have occurred and be continuing, all or a portion of the funds in the Reserve Fund and the
Yield Supplement Account shall be invested in Eligible Investments and reinvested by the Securities Intermediary upon the written direction
of the Servicer, subject to the provisions of Section 4.01(b) of the Sale and Servicing Agreement. All income or other gain
from investments of monies deposited in the Reserve Fund and the Yield Supplement Account shall be credited to such Account, and any loss
resulting from such investments shall be charged to such Account.

 

(b)            To
the extent that the Servicer is required to remit all payments received from or on behalf of the Obligors on or in respect of the Receivables
and all Net Liquidation Proceeds daily to the Collection Account as provided in Section 4.02 of the Sale and Servicing Agreement,
all or a portion of the funds in the Collection Account may be invested in Eligible Investments and reinvested by the Securities Intermediary
upon the written direction of the Servicer, subject to the provisions of Section 4.01(b) of the Sale and Servicing Agreement.
All income or other gain from investments of monies deposited in the Collection Account, if any, shall be paid to the Servicer as part
of the Supplemental Servicing Fee, and any loss resulting from such investments shall be charged to the Collection Account in accordance
with Section 4.01(b) of the Sale and Servicing Agreement.

 

(c)            Subject
to Section 6.01(c), the Securities Intermediary shall not in any way be held liable by reason of any insufficiency in any of the
Reserve Fund, the Yield Supplement Account or the Collection Account resulting from any loss on any Eligible Investment included therein
except for losses attributable to the Securities Intermediary’s failure to make payments on such Eligible Investments issued by
the Securities Intermediary, in its commercial capacity as principal obligor and not as trustee, in accordance with their terms.

 

(d)            If
(i) the Servicer shall have failed to give investment directions for any funds on deposit in the Reserve Fund, Yield Supplement Account
or Collection Account to the Securities Intermediary by 2:00 P.M., New York Time (or such other time as may be agreed by the Issuer and
the Securities Intermediary) on any Business Day or (ii) to the knowledge of a Responsible Officer of the Indenture Trustee a Default
or Event of Default shall have occurred and be continuing with respect to the Notes but the Notes shall not have been declared due and
payable pursuant to Section 5.02 or (iii) if such Notes shall have been declared due and payable following an Event of Default
but amounts collected or receivable from the Owner Trust Estate are being applied in accordance with Section 5.05 as if there had
not been such a declaration, then the Indenture Trustee upon actual knowledge by a Responsible Officer of such event shall, in the case
of clause (i) above, maintain such funds in cash or, in the case of clauses (ii) or (iii) above, to the fullest extent
practicable, invest and reinvest funds in the Reserve Fund, Yield Supplement Account or Collection Account as specified in the most recent
investment direction received by the Securities Intermediary from the Servicer.

 

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Section 8.04. Release of Owner Trust Estate.

 

(a)            Subject
to the payment of its fees and expenses pursuant to Section 6.07, the Indenture Trustee may, and when required by the provisions
of this Indenture shall, execute instruments to release property from the lien of this Indenture, or convey the Indenture Trustee’s
interest in the same, in a manner and under circumstances that are not inconsistent with the provisions of this Indenture. No party relying
upon an instrument executed by the Indenture Trustee as provided in this Article shall be bound to ascertain the Indenture Trustee’s
authority, inquire into the satisfaction of any conditions precedent or see to the application of any monies.

 

(b)            The
Indenture Trustee shall, at such time as there are no Notes Outstanding and all sums due the Indenture Trustee pursuant to Section 6.07
have been paid, release any remaining portion of the Owner Trust Estate that secured the Notes from the lien of this Indenture and release
to the Issuer or any other Person entitled thereto any funds then on deposit in the Accounts. The Indenture Trustee shall release property
from the lien of this Indenture pursuant to this Section 8.04(b) only upon receipt of an Issuer Request accompanied by an Officer’s
Certificate, an Opinion of Counsel and (if required by the TIA) Independent Certificates in accordance with TIA §§ 314(c) and
314(d)(1) meeting the applicable requirements of Section 11.01. Such release shall be deemed to have been made upon completion
of the requirements set forth in the foregoing sentence.

 

Section 8.05. Opinion of Counsel. The
Indenture Trustee shall receive at least seven (7) days written notice when requested by the Issuer, unless such notice requirement
is waived by the Indenture Trustee, to take any action pursuant to Section 8.04(a), accompanied by copies of any instruments involved,
and the Indenture Trustee shall also require, as a condition to such action, an Opinion of Counsel, in form and substance satisfactory
to the Indenture Trustee, stating the legal effect of any such action, outlining the steps required to complete the same, and concluding
that all conditions precedent to the taking of such action have been complied with and such action will not materially and adversely impair
the security for the Notes or the rights of the Noteholders in contravention of the provisions of this Indenture; provided, however, that
such Opinion of Counsel shall not be required to express an opinion as to the fair value of the Owner Trust Estate. Counsel rendering
any such opinion may rely, without independent investigation, on the accuracy and validity of any certificate or other instrument delivered
to the Indenture Trustee in connection with any such action.

 

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ARTICLE IX

 

SUPPLEMENTAL INDENTURES

 

Section 9.01. Supplemental Indentures Without
Consent of Noteholders.

 

(a)          Without
the consent of the Noteholders of any Notes but with prior notice from the Administrator to each Rating Agency, the Issuer and the Indenture
Trustee, when authorized by an Issuer Order, at any time and from time to time, may enter into one or more indentures supplemental hereto
(which shall conform to the provisions of the TIA as in force at the date of the execution thereof), in form satisfactory to the Indenture
Trustee, for any of the following purposes:

 

(i)              to
correct or amplify the description of any property at any time subject to the lien of this Indenture, or better to assure, convey and
confirm unto the Indenture Trustee any property subject or required to be subjected to the lien of this Indenture, or to subject additional
property to the lien of this Indenture;

 

(ii)            to
evidence the succession, in compliance with the applicable provisions hereof, of another Person to the Issuer, and the assumption by any
such successor of the covenants of the Issuer herein and in the Notes contained;

 

(iii)            to
add to the covenants of the Issuer, for the benefit of the Noteholder of any Notes, or to surrender any right or power herein conferred
upon the Issuer;

 

(iv)            to
convey, transfer, assign, mortgage or pledge any property to or with the Indenture Trustee;

 

(v)            to
cure any ambiguity, to correct or supplement any provision herein or in any supplemental indenture that may be inconsistent with any other
provision herein or in any supplemental indenture or the other Basic Documents or to make any other provisions with respect to matters
or questions arising under this Indenture or in any supplemental indenture; provided, that such action shall not adversely affect the
interests of the Noteholders;

 

(vi)            to
evidence and provide for the acceptance of the appointment hereunder by a successor trustee with respect to the Notes and to add to or
change any of the provisions of this Indenture as shall be necessary to facilitate the administration of the trusts hereunder by more
than one trustee, pursuant to the requirements of Article VI;

 

(vii)            to
modify, eliminate or add to the provisions of this Indenture to such extent as shall be necessary to effect the qualification of this
Indenture under the TIA or under any similar federal statute hereafter enacted and to add to this Indenture such other provisions as may
be expressly required by the TIA; or

 

(viii)          to
correct any manifest error in the terms of this Indenture as compared to the terms expressly set forth in the Prospectus.

 

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The Indenture Trustee is hereby authorized to join
in the execution of any such supplemental indenture and to make any further appropriate agreements and stipulations that may be therein
contained.

 

(b)            The
Issuer and the Indenture Trustee, when authorized by an Issuer Order, may, also without the consent of any of the Noteholders but with
prior notice from the Administrator to each Rating Agency, enter into an indenture or indentures supplemental hereto for the purpose of
adding any provisions to, or changing in any manner or eliminating any of the provisions of, this Indenture or of modifying in any manner
the rights of the Noteholders under this Indenture; provided, however, that such action shall not, as evidenced by an Opinion of Counsel,
adversely affect in any material respect the interests of any Noteholder whose written consent has not been obtained.

 

Section 9.02. Supplemental Indentures With
Consent of Noteholders. The Issuer and the Indenture Trustee, when authorized by an Issuer Order, also may, with prior notice from
the Administrator to each Rating Agency and with the written consent of the Noteholders of not less than a majority of the Outstanding
Amount, by Act of such Noteholders delivered to the Issuer, the Indenture Trustee (which consent shall not be unreasonably withheld),
enter into an indenture or indentures supplemental hereto for the purpose of adding any provisions to, or changing in any manner or eliminating
any of the provisions of, this Indenture or of modifying in any manner the rights of the Noteholders under this Indenture; provided, however,
that no such supplemental indenture shall, without the written consent of the Noteholder of each Outstanding Note affected thereby:

 

(i)            change
the date of payment of any installment of principal of or interest on any Note, or reduce the principal amount thereof, the Interest Rate
thereon or the Redemption Price with respect thereto, change the provisions of this Indenture relating to the application of collections
on, or the proceeds of the sale of, the Owner Trust Estate to payment of principal of or interest on the Notes, or change any place of
payment where, or the coin or currency in which, any Note or the interest thereon is payable, or impair the right to institute suit for
the enforcement of the provisions of this Indenture requiring the application of funds available therefor, as provided in Article V,
to the payment of any such amount due on the Notes on or after the respective due dates thereof (or, in the case of redemption, on or
after the Redemption Date);

 

(ii)            reduce
the percentage of the Outstanding Amount, the consent of the Noteholders of which is required for any such supplemental indenture, or
the consent of the Noteholders of which is required for any waiver of compliance with certain provisions of this Indenture or certain
defaults hereunder and their consequences provided for in this Indenture;

 

(iii)            modify
or alter the provisions of the proviso to the definition of the term “Outstanding”;

 

(iv)            reduce
the percentage of the Outstanding Amount required to direct the Indenture Trustee to direct the Issuer to sell or liquidate the Owner
Trust Estate pursuant to Section 5.04 or amend the provisions of this Article which specify the percentage of the Outstanding
Amount required to amend this Indenture or the other Basic Documents;

 

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(v)            modify
any provision of this Section except to increase any percentage specified herein or provide that certain additional provisions of
this Indenture or the Basic Documents cannot be modified or waived without the consent of the Noteholder of each Outstanding Note affected
thereby;

 

(vi)            permit
the creation of any lien ranking prior to or on a parity with the lien of this Indenture with respect to any part of the Owner Trust Estate
or, except as otherwise permitted or contemplated herein, terminate the lien of this Indenture on any property at any time subject hereto
or deprive the Noteholder of any Note of the security provided by the lien of this Indenture; or

 

(vii)            amend
the provisions of Section 7.06 regarding the voting of Notes held by the Honda Parties, if any.

 

The Administrator shall certify to the Indenture
Trustee whether or not any Notes would be affected by any supplemental indenture and any such certification shall be conclusive upon all
Noteholders, whether theretofore or thereafter authenticated and delivered hereunder.

 

It shall not be necessary for any Act of Noteholders
under this Section to approve the particular form of any proposed supplemental indenture, but it shall be sufficient if such Act
shall approve the substance thereof.

 

Promptly after the execution by the Issuer and
the Indenture Trustee of any supplemental indenture pursuant to this Section, the Indenture Trustee shall mail to the Noteholders to which
such amendment or supplemental indenture relates a notice setting forth in general terms the substance of such supplemental indenture.
Any failure of the Indenture Trustee to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity
of any such supplemental indenture.

 

Section 9.03. Execution of Supplemental
Indentures. In executing, or permitting the additional trusts created by, any supplemental indenture permitted by this Article or
the modification thereby of the trusts created by this Indenture, the Trustees shall be entitled to receive, and subject to Sections 6.01
and 6.02, shall be fully protected in relying upon, an Opinion of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture. The Trustees may, but shall not be obligated to, enter into any such supplemental indenture
that affects the respective Trustee’s own rights, duties, liabilities or immunities under this Indenture or otherwise. No supplemental
indenture that adversely affects a Trustee shall be effective without its prior written consent.

 

Section 9.04. Effect of Supplemental Indenture.
Upon the execution of any supplemental indenture pursuant to the provisions hereof, this Indenture shall be and shall be deemed to be
modified and amended in accordance therewith with respect to the Notes affected thereby, and the respective rights, limitations of rights,
obligations, duties, liabilities and immunities under this Indenture of the Indenture Trustee, the Issuer and the Noteholders shall thereafter
be determined, exercised and enforced hereunder subject in all respects to such modifications and amendments, and all the terms and conditions
of any such supplemental indenture shall be and be deemed to be part of the terms and conditions of this Indenture for any and all purposes.

 

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Section 9.05. Conformity with Trust Indenture
Act. Every amendment of this Indenture and every supplemental indenture executed pursuant to this Article shall conform to the
requirements of the TIA as then in effect so long as this Indenture shall then be qualified under the TIA.

 

Section 9.06. Reference in Notes to Supplemental
Indentures. Notes authenticated and delivered after the execution of any supplemental indenture pursuant to this Article may,
and if required by the Indenture Trustee shall, bear a notation in form approved by the Indenture Trustee as to any matter provided for
in such supplemental indenture. If the Issuer or the Indenture Trustee shall so determine, new Notes so modified as to conform, in the
opinion of the Indenture Trustee and the Issuer, to any such supplemental indenture may be prepared and executed by the Issuer and authenticated
and delivered by the Indenture Trustee in exchange for Outstanding Notes.

 

ARTICLE X

 

REDEMPTION OF NOTES

 

Section 10.01. Redemption. The Outstanding
Notes are subject to redemption in whole, but not in part, pursuant to Section 8.01 of the Sale and Servicing Agreement, on any Payment
Date on which the Servicer exercises its option to purchase the Owner Trust Estate pursuant to said Section, for a purchase price equal
to the Redemption Price; provided that the Issuer has available funds sufficient to pay the Redemption Price. The Administrator shall
make notice available to each Rating Agency of such redemption. If the outstanding Notes are to be redeemed pursuant to this Section,
the Servicer or the Issuer shall furnish written notice of such election to the Indenture Trustee not later than ten (10) days prior
to the Redemption Date and the Issuer shall deposit by 8:00 A.M., Los Angeles time, on the Redemption Date with the Indenture Trustee
in the Note Distribution Account the Redemption Price of the Notes to be redeemed, whereupon all such Notes shall be due and payable on
the Redemption Date upon the furnishing of a notice complying with Section 10.02 to each Noteholder.

 

Section 10.02. Form of Redemption
Notice. Notice of redemption under Section 10.01 shall be given by the Indenture Trustee by first-class mail, postage prepaid,
by electronic mail in accordance with Section 11.04, or by facsimile, mailed or transmitted prior to the applicable Redemption Date
to each Noteholder, as of the close of business on the Record Date preceding the applicable Redemption Date, at such Noteholder’s
address or facsimile number appearing in the Note Register.

 

All notices of redemption shall include the following
information:

 

(i)            the
Redemption Date;

 

(ii)            the
Redemption Price;

 

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(iii)            the
CUSIP number;

 

(iv)            the
place where such Notes are to be surrendered for payment of the Redemption Price (which shall be the office or agency of the Issuer to
be maintained as provided in Section 3.02); and

 

(v)            that
on the Redemption Date, the Redemption Price will become due and payable upon each Note and that interest thereon shall cease to accrue
from and after the Redemption Date.

 

Notice of redemption of the Notes shall be given by the Indenture Trustee
in the name and at the expense of the Issuer. Failure to give notice of redemption, or any defect therein, to any Noteholder of any Note
shall not impair or affect the validity of the redemption of any other Note.

 

Section 10.03. Notes Payable on Redemption
Date. The Notes or portions thereof to be redeemed shall, following notice of redemption as required by Section 10.02, on the
Redemption Date become due and payable at the Redemption Price and (unless the Issuer shall default in the payment of the Redemption Price)
no interest shall accrue on the Redemption Price for any period after the date to which accrued interest is calculated for purposes of
calculating the Redemption Price.

 

ARTICLE XI

 

MISCELLANEOUS

 

Section 11.01. Compliance Certificates
and Opinions, etc.

 

(a)          Upon
any application or request by the Issuer to the Indenture Trustee to take any action that is not specifically required by any provision
of this Indenture, the Issuer shall furnish to the Indenture Trustee (i) an Officer’s Certificate stating that all conditions
precedent, if any, provided for in this Indenture relating to the proposed action have been complied with, (ii) an Opinion of Counsel
stating that in the opinion of such counsel all such conditions precedent, if any, have been complied with and (iii) (if required
by the TIA and except in the case of a full redemption under Section 10.01) an Independent Certificate from a firm of certified public
accountants meeting the applicable requirements of this Section. Upon any application or request by the Issuer to the Indenture Trustee
to take any action under any provision of this Indenture wherein such application or request as to which the furnishing of such documents
is specifically required by any provision of this Indenture, no additional certificate or opinion need be furnished.

 

Every certificate or opinion with respect to compliance
with a condition or covenant provided for in this Indenture shall include:

 

(i)            a
statement that each signatory of such certificate or opinion has read or has caused to be read such covenant or condition and the definitions
herein relating thereto;

 

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(ii)            a
brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such
certificate or opinion are based;

 

(iii)            a
statement that, in the opinion of each such signatory, such signatory has made such examination or investigation as is necessary to enable
such signatory to express an informed opinion as to whether or not such covenant or condition has been complied with; and

 

(iv)            a
statement as to whether, in the opinion of each such signatory, such condition or covenant has been complied with.

 

(b)           (i)             Prior
to the deposit of any Collateral or other property or securities with the Indenture Trustee that is to be made the basis for the release
of any property or securities subject to the lien of this Indenture, the Issuer shall, in addition to any obligation imposed in Section 11.01
(a) or elsewhere in this Indenture, furnish to the Indenture Trustee an Officer’s Certificate certifying or stating the opinion
of each person signing such certificate as to the fair value (within ninety (90) days of such deposit) to the Issuer of the Collateral
or other property or securities to be so deposited.

 

(ii)            Whenever
the Issuer is required to furnish to the Indenture Trustee an Officer’s Certificate certifying or stating the opinion of any signer
thereof as to the matters described in clause (i) above, the Issuer shall also deliver to the Indenture Trustee an Independent Certificate
as to the same matters, if the fair value to the Issuer of the securities to be so deposited and of all other such securities made the
basis of any such withdrawal or release since the commencement of the then-current fiscal year of the Issuer, as set forth in the certificates
delivered pursuant to clause (i) above and this clause (ii), is 10% or more of the Outstanding Amount, but such a certificate need
not be furnished with respect to any securities so deposited, if the fair value thereof to the Issuer as set forth in the related Officer’s
Certificate is less than $25,000 or less than one percent of the Outstanding Amount of the Notes.

 

(iii)            Other
than with respect to any release described in clause (A) or (B) of Section 11.01(b)(v), whenever any property or securities
are to be released from the lien of this Indenture, the Issuer shall also furnish to the Indenture Trustee an Officer’s Certificate
certifying or stating the opinion of each person signing such certificate as to the fair value (within ninety (90) days of such release)
of the property or securities proposed to be released and stating that in the opinion of such person the proposed release will not impair
the security under this Indenture in contravention of the provisions hereof.

 

(iv)            Whenever
the Issuer is required to furnish to the Indenture Trustee an Officer’s Certificate certifying or stating the opinion of any signer
thereof as to the matters described in clause (iii) above, the Issuer shall also furnish to the Indenture Trustee an Independent
Certificate as to the same matters if the fair value of the property or securities and of all other property (other than property described
in clauses (A) or (B) of Section 11.01 (b)(v)) released from the lien of this Indenture since the commencement of the then-current
calendar year, as set forth in the certificates required by clause (iii) above and this clause (iv), equals 10% or more of the Outstanding
Amount, but such certificate need not be furnished in the case of any release of property or securities if the fair value thereof as set
forth in the related Officer’s Certificate is less than $25,000 or less than one percent of the then Outstanding Amount.

 

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(v)            Notwithstanding
Section 2.12 or any other provision of this Section, the Issuer may, without compliance with the requirements of the other provisions
of this Section, (A) collect, liquidate, sell or otherwise dispose of Receivables and Financed Vehicles as and to the extent permitted
or required by the Basic Documents and (B) make cash payments out of the Accounts as and to the extent permitted or required by the
Basic Documents.

 

Section 11.02. Form of Documents Delivered
to Indenture Trustee. In any case where several matters are required to be certified by, or covered by an opinion of, any specified
Person, it is not necessary that all such matters be certified by, or covered by the opinion of, only one such Person, or that they be
so certified or covered by only one document, but one such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify or give an opinion as to such matters in one or several
documents.

 

Any certificate or opinion of an Authorized Officer
of the Issuer may be based, insofar as it relates to legal matters, upon a certificate or opinion of, or representations by, counsel,
unless such officer knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with
respect to the matters upon which such officer’s certificate or opinion is based are erroneous. Any such certificate of an Authorized
Officer or Opinion of Counsel may be based, insofar as it relates to factual matters, upon a certificate or opinion of, or representations
by, an officer or officers of the Servicer, the Seller, the Issuer or the Administrator, stating that the information with respect to
such factual matters is in the possession of the Servicer, the Seller, the Issuer or the Administrator, unless such counsel knows, or
in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to such matters are erroneous.

 

Where any Person is required to make, give or execute
two or more applications, requests, consents, certificates, statements, opinions or other instruments under this Indenture, they may,
but need not, be consolidated and form one instrument.

 

Whenever in this Indenture, in connection with
any application or certificate or report to the Indenture Trustee, it is provided that the Issuer shall deliver any document as a condition
of the granting of such application, or as evidence of the Issuer’s compliance with any term hereof, it is intended that the truth
and accuracy, at the time of the granting of such application or at the effective date of such certificate or report (as the case may
be), of the facts and opinions stated in such document shall in such case be conditions precedent to the right of the Issuer to have such
application granted or to the sufficiency of such certificate or report. The foregoing shall not, however, be construed to affect the
Indenture Trustee’s right to rely upon the truth and accuracy of any statement or opinion contained in any such document as provided
in Article VI.

 

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Section 11.03. Acts of Noteholders.

 

(a)          Any
request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be given or taken by
Noteholders may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Noteholders in person
or by agents duly appointed in writing; and except as herein otherwise expressly provided such action shall become effective when such
instrument or instruments are delivered to the Indenture Trustee and, where it is hereby expressly required, to the Issuer. Such instrument
or instruments (and the action embodied therein and evidenced thereby) are herein sometimes referred to as the “Act” of the
Noteholders signing such instrument or instruments. Proof of execution of any such instrument or of a writing appointing any such agent
shall be sufficient for any purpose of this Indenture and (subject to Section 6.01) conclusive in favor of the Indenture Trustee
and the Issuer, if made in the manner provided in this Section.

 

(b)          The
fact and date of the execution by any person of any such instrument or writing may be proved in any manner that the Indenture Trustee
deems sufficient.

 

(c)          The
ownership of Notes shall be proved by the Note Register.

 

(d)          Any
request, demand, authorization, direction, notice, consent, waiver or other action by any Noteholder shall bind the Noteholder of every
Note issued upon the registration thereof or in exchange therefor or in lieu thereof, in respect of anything done, omitted or suffered
to be done by the Indenture Trustee or the Issuer in reliance thereon, whether or not notation of such action is made upon such Note.

 

Section 11.04. Notices, etc., to Indenture
Trustee, Issuer and Rating Agencies. (a)  Any request, demand, authorization, direction, notice, consent, waiver or Act
of Noteholders or other documents provided or permitted by this Indenture shall be in writing and if such request, demand, authorization,
direction, notice, consent, waiver or Act of Noteholders is to be made upon, given or furnished to or filed with:

 

(i)            the
Indenture Trustee by any Noteholder or by the Issuer shall be sufficient for every purpose hereunder if made, given, furnished or filed
in writing and mailed first-class, postage prepaid, overnight delivery service or facsimile to or with the Indenture Trustee at its Corporate
Trust Office, or (as to notices sent by the Issuer to the Indenture Trustee only) if sent by electronic mail, to an address provided by
the Indenture Trustee in writing, or

 

(ii)            the
Issuer by the Indenture Trustee or by any Noteholder shall be sufficient for every purpose hereunder if in writing and mailed first-class,
postage prepaid, overnight delivery service or facsimile to the Issuer addressed to the address set forth on Schedule A to the Sale and
Servicing Agreement or at any other address previously furnished in writing to the Indenture Trustee by the Issuer or the Administrator.
The Issuer shall promptly transmit any notice received by it from the Noteholders to the Indenture Trustee.

 

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(iii)            (a) Notices
required to be given to each Rating Agency by the Issuer or the Administrator shall be in writing, personally delivered, couriered or
mailed by certified mail, return receipt requested, electronic mail (if an address therefore has been provided by the respective party
in writing) or overnight delivery service to the address set forth for such Rating Agency on Schedule A to the Sale and Servicing Agreement;
or at such other address (including electronic mail addresses) as shall be designated by written notice to the party or parties providing
notice under this paragraph.

 

(b)          Notwithstanding
subsection (iii)(a) above, notices required to be given to each Rating Agency by the Issuer or the Administrator, as the case may
be, may be made available by the Administrator through a website post, provided that the Administrator shall inform or cause each Rating
Agency to be informed in writing (including by electronic mail) that a notice has been posted.

 

(i)            Notices
required to be given to the Honda Parties pursuant to Section 7.02(e) shall be in writing, personally delivered or mailed by
certified mail, return receipt requested, or overnight delivery service, by facsimile or by electronic mail (if an address therefore has
been provided by the Honda Parties in writing) to the address set forth on Schedule A to the Sale and Servicing Agreement.

 

Section 11.05. Notices to Noteholders;
Waiver. Where this Indenture provides for notice to Noteholders of any event, such notice shall be sufficiently given (unless otherwise
herein expressly provided) if in writing and mailed, first-class, postage prepaid to each Noteholder affected by such event, at such Noteholder’s
address as it appears on the Note Register, not later than the latest date, and not earlier than the earliest date, prescribed for the
giving of such notice. In any case where notice to Noteholders is given by mail, neither the failure to mail such notice nor any defect
in any notice so mailed to any particular Noteholder shall affect the sufficiency of such notice with respect to other Noteholders, and
any notice that is mailed in the manner herein provided shall conclusively be presumed to have been duly given.

 

Where this Indenture provides for notice in any
manner, such notice may be waived in writing by any Person entitled to receive such notice, either before or after the event, and such
waiver shall be the equivalent of such notice. Waivers of notice by Noteholders shall be filed with the Indenture Trustee but such filing
shall not be a condition precedent to the validity of any action taken in reliance upon such a waiver.

 

In case, by reason of the suspension of regular
mail service as a result of a strike, work stoppage or similar activity, it shall be impractical to mail notice of any event to Noteholders
when such notice is required to be given pursuant to any provision of this Indenture, then any manner of giving such notice as shall be
satisfactory to the Indenture Trustee shall be deemed to be a sufficient giving of such notice.

 

Where this Indenture provides for notice to each
Rating Agency, failure to give such notice shall not affect any other rights or obligations created hereunder, and shall not under any
circumstance constitute a Default or Event of Default.

 

Section 11.06. Alternate Payment and Notice
Provisions. Notwithstanding any provision of this Indenture or any of the Notes to the contrary, the Issuer may enter into any agreement
with any Noteholder of a Note providing for a method of payment, or notice by the Indenture Trustee or any Paying Agent to such Noteholder,
that is different from the methods provided for in this Indenture for such payments or notices. The Issuer will furnish to the Indenture
Trustee a copy of each such agreement and the Indenture Trustee will cause payments to be made and notices to be given in accordance with
such agreements.

 

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Section 11.07. Conflict with Trust Indenture
Act. If any provision hereof limits, qualifies or conflicts with another provision hereof that is required to be included in this
Indenture by any of the provisions of the Trust Indenture Act, such required provision shall control.

 

The provisions of TIA Sections 310 through 317
that impose duties on any person (including the provisions automatically deemed included herein unless expressly excluded by this Indenture)
are a part of and govern this Indenture, whether or not physically contained herein.

 

Section 11.08. Effect of Headings and Table
of Contents. The Article and Section headings herein and the Table of Contents are for convenience only and shall not affect
the construction hereof.

 

Section 11.09. Successors and Assigns.
All covenants and agreements in this Indenture and the Notes by the Issuer shall bind its successors and assigns, whether so expressed
or not. All agreements of the Indenture Trustee in this Indenture shall bind its successors, co-trustees and agents.

 

Section 11.10. Separability. In case
any provision in this Indenture or in the Notes shall be invalid, illegal or unenforceable, the validity, legality and enforceability
of the remaining provisions of this Indenture and the Notes shall not in any way be affected or impaired thereby.

 

Section 11.11. Benefits of Indenture.
Nothing in this Indenture or in the Notes, express or implied, shall give to any Person, other than the parties hereto, the Trustees and
their successors hereunder, the Noteholders, and any other party secured hereunder, and any other Person with an ownership interest in
any part of the Owner Trust Estate, any benefit or any legal or equitable right, remedy or claim under this Indenture.

 

Section 11.12. Legal Holidays. In any
case where the date on which any payment is due shall not be a Business Day, then (notwithstanding any other provision of the Note’s
or this Indenture) payment need not be made on such date, but may be made on the next succeeding Business Day with the same force and
effect as if made on the date on which nominally due, and no interest shall accrue for the period from and after any such nominal date.

 

Section 11.13. Governing Law; Submission
to Jurisdiction; Waiver of Jury Trial. THIS INDENTURE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED
IN ACCORDANCE WITH SUCH LAWS. Regardless of any provision in any other agreement, for purposes
of the UCC, New York shall be deemed to be the Securities Intermediary’s jurisdiction, and the law of the State of New York shall
govern all issues specified in Article 2(1) of the Hague Securities Convention.

 

    	 	59	 

     

    

 

Each of the parties hereto hereby submits to the
exclusive jurisdiction of the United States District Court for the Southern District of New York and of any New York State court sitting
in New York City for purposes of all legal proceedings arising out of or relating to this Indenture or the transactions contemplated hereby.
Each of the parties hereto hereby further irrevocably waives any claim that any such courts lack jurisdiction over such party, and agrees
not to plead or claim, in any legal action or proceeding with respect to this Indenture in any of the aforesaid courts, that any such
court lacks jurisdiction over such party. Each of the parties hereto irrevocably waives, to the fullest extent permitted by law, any objection
that it may now or hereafter have to the laying of the venue of any such proceeding brought in such a court and any claim that any such
proceeding brought in such a court has been brought in an inconvenient forum.

 

Each party hereto hereby waives, to the fullest
extent permitted by applicable law, any right it may have to a trial by jury in respect of any litigation directly or indirectly arising
out of, under or in connection with this Indenture.

 

Section 11.14. Counterparts; Electronic
Transmission.

 

(a)            This
Indenture may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument. Delivery of an executed counterpart of a signature page of this Indenture
may be electronically signed, and that any digital or electronic signatures (including pdf, facsimile or electronically imaged signatures
provided by DocuSign or any other digital signature provider as specified in writing to the Indenture Trustee) appearing on this Agreement
or such other documents are the same as handwritten signatures for the purposes of validity, enforceability and admissibility, and that
delivery of any such electronic signature to, or a signed copy of, this Agreement and such other documents may be made by facsimile, email
or other electronic transmission. The words “execution,” “signed,” “signature,” “delivery,”
and words of like import in or relating to any document to be signed in connection with this Indenture and the transactions contemplated
hereby shall be deemed to include electronic signatures, deliveries 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, physical delivery thereof 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 other similar state laws based on the Uniform Electronic Transactions Act.

 

(b)            The
Indenture Trustee, the Owner Trustee, the Delaware Trustee and the Issuer are authorized to accept written instructions, directions, reports,
notices or other communications signed manually, by way of faxed signatures, or delivered by Electronic Transmission. In the absence of
bad faith or negligence on its part, each of the Indenture Trustee, the Owner Trustee, the Delaware Trustee and the Issuer may conclusively
rely on the fact that the Person sending instructions, directions, reports, notices or other communications or information by Electronic
Transmission is, in fact, a Person authorized to give such instructions, directions, reports, notices or other communications or information
on behalf of the party purporting to send such Electronic Transmission and, in the absence of bad faith or negligence, shall not have
any liability for any losses, liabilities, costs or expenses incurred or sustained by any party as a result of such reliance upon or compliance
with such instructions, directions, reports, notices or other communications or information to the Indenture Trustee, the Owner Trustee,
the Delaware Trustee or the Issuer, including, without limitation, the risk of either the Indenture Trustee, the Owner Trustee, the Delaware
Trustee or the Issuer acting on unauthorized instructions, notices, reports or other communications or information, and the risk of interception
and misuse by third parties.

 

    	 	60	 

     

    

 

Section 11.15. Recording of Indenture.
If this Indenture is subject to recording in any appropriate public recording offices, such recording is to be effected by the Issuer
and at its expense accompanied by an Opinion of Counsel (which may be counsel to the Indenture Trustee or any other counsel reasonably
acceptable to the Indenture Trustee) to the effect that such recording is necessary either for the protection of the Noteholders or any
other Person secured hereunder or for the enforcement of any right or remedy granted to the Indenture Trustee under this Indenture.

 

Section 11.16. Trust Obligation. No
recourse may be taken, directly or indirectly, with respect to the obligations of the Issuer, the Owner Trustee or the Indenture Trustee
on the Notes or under this Indenture or any certificate or other writing delivered in connection herewith or therewith, against (i) the
Indenture Trustee or the Owner Trustee in its individual capacity, (ii) any owner of a beneficial interest in the Issuer or (iii) any
partner, owner, beneficiary, agent, officer, director, employee or agent of the Indenture Trustee or the Owner Trustee in its individual
capacity, any holder of a beneficial interest in the Issuer, the Owner Trustee or the Indenture Trustee or of any successor or assign
of the Indenture Trustee or the Owner Trustee in its individual capacity, except as any such Person may have expressly agreed (it being
understood that the Indenture Trustee and the Owner Trustee have no such obligations in their individual capacity) and except that any
such partner, owner or beneficiary shall be fully liable, to the extent provided by applicable law, for any unpaid consideration for stock,
unpaid capital contribution or failure to pay any installment or call owing to such entity. For all purposes of this Indenture, in the
performance of any duties or obligations of the Issuer hereunder, the Owner Trustee shall be subject to, and entitled to the benefits
of, the terms and provisions of Articles VI, VII and VIII of the Trust Agreement as if specifically set forth herein.

 

Section 11.17. No Petition. The Indenture
Trustee, by entering into this Indenture, and each Noteholder, by accepting a Note, hereby covenant and agree that they will not at any
time institute against the Issuer, or join in any institution against the Issuer of, any bankruptcy, reorganization, arrangement, insolvency
or liquidation proceedings, or other proceedings under any U.S. federal or state bankruptcy or similar law in connection with any obligations
relating to the Notes, this Indenture or any of the other Basic Documents.

 

Section 11.18. Inspection. The Issuer
agrees that, on reasonable prior notice, it will permit any representative of the Indenture Trustee, during the Issuer’s normal
business hours, to examine all the accounting books, records, reports and other papers of the Issuer, to make copies and extracts therefrom,
to cause such books to be audited by Independent certified public accountants, and to discuss the Issuer’s affairs, finances and
accounts with the Issuer’s officers and Independent certified public accountants, all at such reasonable times and as often as may
be reasonably requested. Notwithstanding anything herein to the contrary, the foregoing shall not be construed to prohibit (i) the
disclosure of any and all information that is or becomes publicly known, or information obtained by the Indenture Trustee from sources
other than the Servicer or the Issuer, (ii) the disclosure of any and all information (A) if required to do so by any applicable
law, rule or regulation, (B) to any government agency or regulatory body having or claiming authority to regulate or oversee
any aspects of the Indenture Trustee’s business or that of its affiliates, (C) pursuant to any subpoena, civil investigative
demand or similar demand or request of any court, regulatory authority, arbitrator or arbitration to which the Indenture Trustee or any
affiliate or an officer, director, employer or shareholder thereof is a party, (D) in any preliminary or final offering circular,
registration statement or contract or other document pertaining to the transactions contemplated by the Agreement approved in advance
by the Servicer or the Issuer or (E) to any affiliate, independent or internal auditor, agent, employee or attorney of the Indenture
Trustee having a need to know the same for reasons directly related to the ability of the Indenture Trustee to perform its duties hereunder,
provided that the Indenture Trustee advises such recipient of the confidential nature of the information being disclosed, or (iii) any
other disclosure authorized by the Servicer or the Issuer.

 

    	 	61	 

     

    

 

Section 11.19. [Reserved]

 

Section 11.20. Disclosure of Tax Treatment.
Notwithstanding the foregoing or anything herein to the contrary, all persons (and their respective employees, representatives or other
agents) may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure of the transaction described
herein and all materials of any kind (including opinions or other tax analyses) that are provided to the recipient relating to such tax
treatment and tax structure. However, any such information relating to the tax treatment or tax structure shall be required to be kept
confidential to the extent necessary to comply with any applicable securities laws.

 

Section 11.21. Intent of the Parties; Reasonableness.
The Indenture Trustee and Issuer acknowledge and agree that the purpose of Section 3.09 and 7.02(e) of this Indenture is to
facilitate compliance by the Issuer and the Depositor with the provisions of Regulation AB and related rules and regulations of the
Commission.

 

Neither the Issuer nor the Administrator (acting
on behalf of the Issuer) shall exercise its right to request delivery of information or other performance under these provisions other
than in good faith, or for purposes other than compliance with federal securities laws, including the Securities Act, the Exchange Act
and the rules and regulations of the Commission thereunder. Each of the parties hereto agrees that (a) the obligations of the
parties hereunder shall be interpreted in such a manner as to accomplish compliance with Regulation AB, (b) the parties’ obligations
hereunder will be supplemented and modified as necessary to be consistent with any such amendments, interpretive advice or guidance from
the Securities and Exchange Commission, convention or consensus among active participants in the asset-backed securities markets, or otherwise
in respect of the requirements of Regulation AB as they may be applied by the Securities and Exchange Commission to the Issuer in connection
with the Notes and (c) the parties shall comply with reasonable requests made by or on behalf of the Issuer or the Indenture Trustee
for delivery of additional or different information, to the extent such information is available, as the person requesting such information
may determine in good faith is necessary for it to comply with the provisions of Regulation AB. Any and all expenses incurred by the Indenture
Trustee in compliance with this Section shall be considered indemnities payable in accordance with Section 6.07 hereof.

 

    	 	62	 

     

    

 

The Issuer (or the Administrator, acting on behalf
of the Issuer) shall cooperate with the Indenture Trustee by providing timely notice of requests for information under these provisions
and by reasonably limiting such requests to information required, in the reasonable judgment of the Issuer to comply with Regulation AB.

 

Section 11.22. Owner Trustee. The parties
hereto agree that this Indenture is executed and delivered by the Owner Trustee, not individually or personally but solely as owner trustee
of the Issuer, in the exercise of the powers and authority conferred and vested in it under the Amended and Restated Trust Agreement;
each of the representations, undertakings and agreements herein made on the part of the Issuer are made and intended not as personal representations,
undertakings and agreements by The Bank of New York Mellon or BNY Mellon Trust of Delaware but are made and intended for the purpose of
binding only the Issuer; and under no circumstances shall The Bank of New York Mellon or BNY Mellon Trust of Delaware be personally liable
for the inaccuracy or breach of any statements made by the Issuer in this Indenture.

 

Section 11.23. U.S.A. Patriot Act.
The parties hereto acknowledge that in accordance with Section 326 of the U.S.A. Patriot Act, the Indenture Trustee, like all financial
institutions and in order to help fight the funding of terrorism and money laundering, is required to obtain, verify, and record information
that identifies each person or legal entity that establishes a relationship or opens an account with the Indenture Trustee. The parties
to this Indenture agree that they will provide the Indenture Trustee with such information about the Owner Trustee as it may request in
order for the Indenture Trustee to satisfy the requirements of the U.S.A. Patriot Act.

 

Section 11.24. Communications with Rating
Agencies. If the Indenture Trustee shall receive any written or oral communication from any Rating Agency (or any of their respective
officers, directors or employees) with respect to the transactions contemplated hereby or under the Basic Documents or in any way relating
to the Notes, the Indenture Trustee agrees to refrain from communicating with such Rating Agency and to promptly notify the Administrator
of such communication. The Indenture Trustee agrees to coordinate with the Administrator with respect to any communication received from
a Rating Agency and further agrees that in no event shall the Indenture Trustee engage in any oral communication with respect to the substance
of the transactions contemplated hereby or under the Basic Documents or in any way relating to the Notes, with any Rating Agency (or any
of their respective officers, directors or employees) without the participation of the Administrator.

 

The Indenture Trustee will not be responsible for
delays attributable to the Administrator’s failure to deliver any information related to any communication with a Rating Agency
(with respect to this section, the “Information”), defects in the Information supplied to the Rating Agency or Administrator
or other circumstances beyond the control of the Indenture Trustee. The Indenture Trustee shall be under no obligation to make any determination
as to the veracity or applicability of any Information provided to it, or whether any such Information is required to be maintained on
a website or other public medium.

 

    	 	63	 

     

    

 

IN WITNESS WHEREOF, the parties hereto have caused
this Indenture to be duly executed by their respective officers, thereunto duly authorized and duly attested, all as of the day and year
first above written.

 

	 	HONDA AUTO RECEIVABLES 2021-4 OWNER TRUST,
	 	 
	 	By:     The Bank of New York Mellon,
    not in its individual capacity but solely as Owner Trustee on behalf of the Trust
	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:
	 	 
	 	U.S. BANK NATIONAL ASSOCIATION,
	 	not in its individual capacity but solely as Indenture Trustee and as Securities Intermediary
	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:

 

	Agreed to with respect to Section 7.02(b):	 
	 	 
	AMERICAN HONDA FINANCE CORPORATION, as Servicer	 
	 	 
	By:	 	 
	 	Name:	Paul C. Honda	 
	 	Title:	Vice President and Assistant Secretary	 

 

HAROT 2021-4

Indenture

 

    	 	S-1	 

     

    

 

	
    STATE OF ________________
	)

    

    

	 	) ss
	COUNTY OF ______________	)

 

On _______________, 2021 before me, _______________,
Notary Public, personally appeared ____________________, _______________________.

 

	 ̈	personally known to me, or
	 	 
	 ̈	
    proved to me on the basis of satisfactory evidence to be the person(s) whose
name(s) is/are subscribed to the within instrument,

 

and acknowledged to me that he/she executed the same in his/her authorized
capacity, and that by his/her signature on the instrument the person, or the entity upon behalf of which such person acted, executed the
instrument.

 

WITNESS my hand and official seal.

 

Signature                                                   [Seal]

 

HAROT 2021-4

Indenture

 

    	 	 	 

     

    

 

	
    STATE OF ________________
	)

    

    

	 	) ss
	COUNTY OF ______________	)

 

On ______________, 2021 before me, _______________,
Notary Public, personally appeared ____________________, _______________________.

 

	 ̈	personally known to me, or
	 	 
	 ̈	
    proved to me on the basis of satisfactory evidence to be the person(s) whose
name(s) is/are subscribed to the within instrument,

 

and acknowledged to me that he/she executed the same in his/her authorized
capacity, and that by his/her signature on the instrument the person, or the entity upon behalf of which such person acted, executed the
instrument.

 

WITNESS my hand and official seal.

 

Signature                                                [Seal]

 

HAROT 2021-4 

Indenture

 

    	 	 	 

     

    

 

SCHEDULE A

 

SCHEDULE OF RECEIVABLES

 

To be provided to the Indenture Trustee

 

    	 	Schedule A-1	 

     

    

 

EXHIBIT A

 

FORM OF CLASS [A-1] [A-2] [A-3] [A-4]
NOTE

 

[For Retained Notes: THIS NOTE HAS NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”), OR UNDER THE SECURITIES OR BLUE SKY LAWS OF ANY STATE IN THE
UNITED STATES OR ANY FOREIGN SECURITIES LAWS. NO SALE, PLEDGE OR OTHER TRANSFER OF THIS NOTE MAY BE MADE BY ANY PERSON UNLESS EITHER
(i) SUCH SALE, PLEDGE OR OTHER TRANSFER IS MADE BY THE SPONSOR TO AN AFFILIATE, (ii) SUCH SALE, PLEDGE OR OTHER TRANSFER IS
MADE TO AN ACCREDITED INVESTOR THAT EXECUTES A NOTE, SUBSTANTIALLY IN THE FORM SPECIFIED IN THE INDENTURE, TO THE EFFECT THAT IT
IS AN ACCREDITED INVESTOR ACTING FOR ITS OWN ACCOUNT (AND NOT FOR THE ACCOUNT OF OTHERS) OR AS A FIDUCIARY OR AGENT FOR OTHERS (WHICH
OTHERS ALSO ARE ACCREDITED INVESTORS UNLESS THE HOLDER IS A BANK ACTING IN ITS FIDUCIARY CAPACITY), (iii) SO LONG AS THIS NOTE IS
ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE 1933 ACT, SUCH SALE, PLEDGE OR OTHER TRANSFER IS MADE TO A PERSON WHO THE PROSPECTIVE
TRANSFEROR REASONABLY BELIEVES AFTER DUE INQUIRY IS A QUALIFIED INSTITUTIONAL BUYER, ACTING FOR ITS OWN ACCOUNT (AND NOT FOR THE ACCOUNT
OF OTHERS) OR AS A FIDUCIARY OR AGENT FOR OTHERS (WHICH OTHERS ALSO ARE QUALIFIED INSTITUTIONAL BUYERS) TO WHOM NOTICE IS GIVEN THAT THE
SALE, PLEDGE OR TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, OR (iv) SUCH SALE, PLEDGE OR OTHER TRANSFER IS OTHERWISE MADE IN
A TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE 1933 ACT, IN WHICH CASE THE SPONSOR SHALL REQUIRE THAT BOTH THE PROSPECTIVE
TRANSFEROR AND THE PROSPECTIVE TRANSFEREE CERTIFY TO THE ISSUER, THE OWNER TRUSTEE, THE INDENTURE TRUSTEE AND THE SPONSOR IN WRITING THE
FACTS SURROUNDING SUCH TRANSFER, WHICH CERTIFICATION SHALL BE IN FORM AND SUBSTANCE SATISFACTORY TO THE SPONSOR. EXCEPT IN THE CASE
OF A TRANSFER DESCRIBED IN CLAUSES (i) OR (iii) ABOVE, THE SPONSOR SHALL REQUIRE A WRITTEN OPINION OF COUNSEL (WHICH SHALL NOT
BE AT THE EXPENSE OF THE TRUST, THE OWNER TRUSTEE OR THE INDENTURE TRUSTEE) SATISFACTORY TO THE SPONSOR TO THE EFFECT THAT SUCH TRANSFER
WILL NOT VIOLATE THE 1933 ACT.

 

UNLESS COUNSEL SATISFACTORY TO THE SPONSOR SHALL
HAVE RENDERED AN OPINION TO THE EFFECT THAT THE RETAINED NOTES TO BE SOLD, PLEDGED, OR TRANSFERRED WILL BE CHARACTERIZED AS INDEBTEDNESS
FOR U.S. FEDERAL INCOME TAX PURPOSES, NO SALE, PLEDGE, OR TRANSFER OF THIS RETAINED NOTE MAY BE MADE.]

 

[For Non-Retained Notes: UNLESS THIS NOTE IS PRESENTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE ISSUER OR ITS AGENT
FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS
IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]

 

    	 	A-1-1	 

     

    

 

THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS
AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ON
THE FACE HEREOF.

 

	REGISTERED	$__________
	 	 
	No. R-_____	CUSIP NO. _______

 

HONDA
AUTO RECEIVABLES 2021-4 OWNER TRUST

 

____%
ASSET BACKED NOTES, CLASS [A-1][A-2] [A-3] [A-4]

 

Honda Auto Receivables 2021-4
Owner Trust, a statutory trust organized and existing under the laws of the State of Delaware (the “Issuer”), for value received,
hereby promises to pay to [American Honda Finance Corporation][Cede & Co.], or registered assigns, the principal sum of
_____________________ Dollars ($__________), payable to the extent described in the Indenture referred to on the reverse hereof on each
Payment Date; provided, however, that the entire unpaid principal amount of this Note shall be payable on the earlier of ________________
___, 20__ (the “Class [A-1] [A-2] [A-3] [A-4] Final Scheduled Payment Date”) and the Redemption Date, if any, selected
pursuant to the Indenture.

 

The Issuer will pay interest
on this Note at the rate per annum shown above on each Payment Date until the principal of this Note is paid or made available for payment,
on the principal amount of this Note outstanding on the preceding Payment Date (after giving effect to all payments of principal made
on the preceding Payment Date), or on the Closing Date in the case of the first Payment Date or if no interest has yet been paid, subject
to certain limitations contained in the Indenture. [Interest on this Class A-[_] Note will accrue for each Payment Date from and
including the immediately preceding Payment Date (or, in the case of the first Payment Date, the Closing Date), to but excluding such
Payment Date]. [Interest on this Class A-[_] Note will accrue for each Payment Date from and including the [__] day of the prior
month (or, in the case of the first Payment Date, the Closing Date) to but excluding the [__] day of the month of such Payment Date] and
will be computed on the basis of [the actual number of days in the Interest Accrual Period with respect to the Class A-[_] Notes
divided by 360] [a 360-day year consisting of twelve 30-day months]. Such principal of and interest on this Note shall be paid in the
manner specified on the reverse hereof.

 

The principal of and interest
on this Note are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment
of public and private debts. All payments made by the Issuer with respect to this Note shall be applied first to interest due and payable
on this Note as provided above and then to the unpaid principal of this Note.

 

    	 	A-1-2	 

     

    

 

Reference is made to the further
provisions of this Note set forth on the reverse hereof, which shall have the same effect as though fully set forth on the face of this
Note.

 

Unless the certificate of
authentication hereon has been executed by the Indenture Trustee whose name appears below by manual signature, this Note shall not be
entitled to any benefit under the Indenture, or be valid or obligatory for any purpose.

 

    	 	A-1-3	 

     

    

 

IN WITNESS WHEREOF, the Issuer
has caused this instrument to be signed, manually, in facsimile or scanned, by its Authorized Officer, as of the date set forth below.

 

	Date:	HONDA AUTO RECEIVABLES 2021-4 OWNER
    TRUST,
	 
	By:	THE BANK OF NEW YORK MELLON, not in its individual capacity but solely as Owner Trustee on behalf of the Trust,
	 	 
	By:	 
	 	Authorized Signatory

 

    	 	A-1-4	 

     

    

 

INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

This is one of the Notes designated
above and referred to in the within-mentioned Indenture.

 

	Date:	U.S. BANK NATIONAL ASSOCIATION not in its individual capacity but solely as Indenture Trustee,
	 	 
	By:	 
	 	Authorized Signatory

 

    	 	A-1-5	 

     

    

 

This Note is one of a duly
authorized issue of Notes of the Issuer, designated as its ___% Asset Backed Notes, Class [A-1] [A-2] [A-3] [A-4] (the “Class [A-1]
[A-2] [A-3] [A-4] Notes”), all issued under the Indenture, to which Indenture and all indentures supplemental thereto reference
is hereby made for a statement of the respective rights and obligations thereunder of the Issuer, the Indenture Trustee and the Noteholders.
The Notes are subject to all terms of the Indenture. Capitalized terms used herein that are not otherwise defined shall have the meanings
ascribed thereto in the Sale and Servicing Agreement.

 

The Class A-1 Notes,
the Class A-2 Notes, the Class A-3 Notes and the Class A-4 Notes (collectively, the “Notes”) are and will be
equally and ratably secured by the collateral pledged as security therefore, except as provided in the Indenture or the Sale and Servicing
Agreement.

 

Principal payable on the Notes
will be paid on each Payment Date in the amount specified in the Indenture and in the Sale and Servicing Agreement. As described above,
the entire unpaid principal amount of this Note will be payable on the earlier of the Class [A-1] [A-2] [A-3] [A-4] Final Scheduled
Payment Date and the Redemption Date, if any, selected pursuant to the Indenture. Notwithstanding the foregoing, under certain circumstances,
the entire unpaid principal amount of the Class [A-1] [A-2] [A-3] [A-4] Notes shall be due and payable following the occurrence and
continuance of an Event of Default, as described in the Indenture. All principal payments on the Class [A-1] [A-2] [A-3] [A-4] Notes
shall be made pro rata to the Class [A-1] [A-2] [A-3] [A-4] Noteholders entitled thereto.

 

Payments of principal and
interest on this Note due and payable on each Payment Date or Redemption Date shall be made by wire transfer in immediately available
funds to the account designated by such Person (and if such Notes are registered on the Record Date in the name of the nominee of the
Depository (initially, such nominee to be Cede & Co.), payments will be made by wire transfer in immediately available funds
to the account designated by such nominee. If funds are expected to be available, as provided in the Indenture or the Sale and Servicing
Agreement, for payment in full of the remaining unpaid principal amount of this Note on a Payment Date or Redemption Date, then the Indenture
Trustee, in the name of and on behalf of the Issuer, will notify the Person who was the registered Noteholder hereof as of the Record
Date preceding such Payment Date or Redemption Date by notice mailed within five (5) Business Days of such Payment Date or Redemption
Date and the amount then due and payable shall be payable only upon presentation and surrender of this Note at the Corporate Trust Office
of the Indenture Trustee.

 

As provided in the Indenture
and subject to the limitations set forth therein and on the face hereof, the transfer of this Note may be registered on the Note Register
upon surrender of this Note for registration of transfer at the office or agency designated by the Issuer pursuant to the Indenture, duly
endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Indenture Trustee duly executed by, the Noteholder
hereof or such Noteholder’s attorney duly authorized in writing, with such signature guaranteed by an “eligible guarantor
institution” meeting the requirements of the Note Registrar, which requirements include membership or participation in the Securities
Transfer Agent’s Medallion Program (“STAMP”) or such other “signature guarantee program” as may be determined
by the Note Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended,
and thereupon one or more new Notes of authorized denominations and in the same aggregate principal amount will be issued to the designated
transferee or transferees. No service charge will be charged for any registration of transfer or exchange of this Note, but the transferor
may be required to pay a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any such
registration of transfer or exchange.

 

    	 	A-1-6	 

     

    

 

Each Noteholder or Note Owner,
by acceptance of a Note or, in the case of a Note Owner, a beneficial interest in a Note, covenants and agrees that no recourse may be
taken, directly or indirectly, with respect to the obligations of the Issuer, the Owner Trustee or the Indenture Trustee on the Notes
or under the Indenture or any certificate or other writing delivered in connection therewith, against (i) the Indenture Trustee or
the Owner Trustee in its individual capacity, (ii) any owner of a beneficial interest in the Issuer or (iii) any partner, owner,
beneficiary, agent, officer, director or employee of the Indenture Trustee or the Owner Trustee in its individual capacity, any holder
of a beneficial interest in the Issuer, the Owner Trustee or the Indenture Trustee or of any successor or assign of the Indenture Trustee
or the Owner Trustee in its individual capacity, except as any such Person may have expressly agreed and except that any such partner,
owner or beneficiary shall be fully liable, to the extent provided by applicable law, for any unpaid consideration for stock, unpaid capital
contribution or failure to pay any installment or call owing to such entity.

 

Each Noteholder or Note Owner,
by acceptance of a Note or, in the case of a Note Owner, a beneficial interest in a Note, covenants and agrees by accepting the benefits
of the Indenture that such Noteholder or Note Owner will not at any time institute against the Depositor or the Issuer, or join in any
institution against the Depositor or the Issuer of, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings
under any U.S. federal or state bankruptcy or similar law in connection with any obligations relating to the Notes, the Indenture or the
other Basic Documents.

 

By acquiring this Note (or
interest herein), each purchaser and transferee (and if the purchaser or transferee is a Plan, its fiduciary) is deemed to represent and
warrant that either (i) it is not acquiring the Note (or interest therein) with the assets of a Benefit Plan Investor or a Plan that
is subject to Similar Law; or (ii) the acquisition and holding of the Note (or interest therein) will not give rise to, in the case
of a Benefit Plan Investor, a nonexempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code or, in
the case of a Plan that is subject to Similar Law, a violation of Similar Law.

 

The Issuer has entered into
the Indenture and this Note is issued with the intention that, for U.S. federal income, state and local income and franchise tax purposes,
the Notes will qualify as indebtedness secured by the Owner Trust Estate. Each Noteholder (other than a Noteholder of a Retained Note),
by acceptance of a Note (and each Note Owner by acceptance of a beneficial interest in a Note), agrees to treat the Notes for U.S. federal
income, state and local income and franchise tax purposes as indebtedness.

 

Prior to the due presentment
for registration of transfer of this Note, the Issuer, the Indenture Trustee and any agent of the Issuer or the Indenture Trustee may
treat the Person in whose name this Note (as of the day of determination or as of such other date as may be specified in the Indenture)
is registered as the owner hereof for all purposes, whether or not this Note be overdue, and none of the Issuer, the Indenture Trustee
or any such agent shall be affected by notice to the contrary.

 

    	 	A-1-7	 

     

    

 

The Indenture permits, with
certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Issuer and the
rights of the Noteholders under the Indenture at any time by the Issuer with the consent of the Noteholders of Notes representing a majority
of the Outstanding Amount of all Notes at the time Outstanding. The Indenture also contains provisions permitting the Noteholders of Notes
representing specified percentages of the Outstanding Amount of the Notes, on behalf of the Noteholders of all the Notes, to waive compliance
by the Issuer with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the Noteholder of this Note (or any one or more Predecessor Notes) shall be conclusive and binding upon such Noteholder
and upon all future Noteholders of this Note and of any Note issued upon the registration of transfer hereof or in exchange hereof or
in lieu hereof whether or not notation of such consent or waiver is made upon this Note. The Indenture also permits the Indenture Trustee
to amend or waive certain terms and conditions set forth in the Indenture without the consent of Noteholders of the Notes issued thereunder.

 

The Notes are issuable only
in registered form in denominations as provided in the Indenture, subject to certain limitations therein set forth.

 

This Note shall be construed
in accordance with the laws of the State of New York, without reference to its conflict of law provisions, and the obligations, rights
and remedies of the parties hereunder and thereunder shall be determined in accordance with such laws.

 

    	 	A-1-8	 

     

    

 

ASSIGNMENT

 

Social Security or taxpayer I.D. or other identifying number of assignee:

 

	FOR
VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto:
	 
	 	 
	
    (name and address
    of assignee)
	 
	 	 
	the within Note and all rights thereunder, and hereby irrevocably constitutes and appoints

	 
	 	 
	
    attorney, to transfer said Note on
    the books kept for registration thereof, with full power of substitution in the premises.
	 
	 	 
	Dated:	 	 	 	1
	 	 	Signature Guaranteed:	*	 
	 	 	 	 	 
	 	 	 	 	 	 

 

1       NOTICE:
The signature to this assignment must correspond with the name of the registered owner as it appears on the face of the within Note in
every particular, without alteration, enlargement or any change whatever. Such signature must be guaranteed by an “eligible guarantor
institution” meeting the requirements of the Note Registrar, which requirements include membership or participation in STAMP or
such other “signature guarantee program” as may be determined by the Note Registrar in addition to, or in substitution for,
STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.

 

    	 	A-1-9	 

     

    

 

EXHIBIT B

 

FORM OF TRANSFEROR CERTIFICATE FOR RETAINED
NOTES

 

[DATE]

 

U.S. Bank National Association

111 Fillmore Ave.

St. Paul, Minnesota 55107

Attention: Corporate Trust Services – Honda Auto Receivables
HAROT 2021-4

 

American Honda Finance Corporation

1919 Torrance Blvd. 5th Floor

Torrance, California 90501

 

	 	Re:	Honda Auto Receivables 2021-4 Owner Trust, Class [__] Notes (Retained Notes)

 

Ladies and Gentlemen:

 

In connection with our disposition of such of
the Class [__] Notes that are Retained Notes (the “Retained Notes”) we certify that (a) we understand that
the Retained Notes have not been registered under the Securities Act of 1933, as amended (the “Act”), but were retained
by the Sponsor, and are being transferred by us in a transaction that is exempt from the registration requirements of the Act and (b) we
have not offered or sold any Retained Notes to, or solicited offers to buy any Retained Notes from, any person, or otherwise approached
or negotiated with any person with respect thereto, in a manner that would be deemed, or taken any other action which would result in,
a violation of Section 5 of the Act.

 

	 	Very truly yours,
	 	 	 
	 	[NAME OF TRANSFEROR]
	 	 	 
	 	By:	 
	 	 	Authorized Officer

 

    	 	B-1	 

     

    

 

 

 

EXHIBIT C

 

FORM OF INVESTMENT LETTER FOR RETAINED NOTES

 

U.S. Bank National Association

111 Fillmore Ave.

St. Paul, Minnesota 55107

Attention: Corporate Trust Services – Honda Auto Receivables
HAROT 2021-4

American Honda Finance Corporation

1919 Torrance Blvd. 5th Floor

Torrance, California 90501

 

Ladies and Gentlemen:

 

In connection with our proposed purchase of such
of the Class [__] Notes that are Retained Notes (the “Retained Notes”) of Honda Auto Receivables 2021-4 Owner
Trust (the “Issuing Entity”), we confirm that:

 

1.            We
understand that such Retained Notes have not been registered under the Securities Act of 1933, as amended (the “1933 Act”)
but were retained by American Honda Finance Corporation (the “Sponsor”), and may not be sold except as permitted in
the following sentence. We understand and agree, on our own behalf and on behalf of any accounts for which we are acting as hereinafter
stated, (x) that such Retained Notes are being offered only in a transaction not involving any public offering within the meaning
of the 1933 Act and (y) that such Retained Notes may be resold, pledged or transferred only (i) to the Sponsor or an Affiliate,
(ii) to an “accredited investor” as defined in Rule 501(a)(1),(2),(3) or (7) of Regulation D under the
1933 Act (an “Accredited Investor”) acting for its own account (and not for the account of others) or as a fiduciary or agent
for others (which others also are Accredited Investors unless the holder is a bank acting in its fiduciary capacity) that executes a certificate
substantially in the form hereof, (iii) so long as such Retained Note is eligible for resale pursuant to Rule 144A under the
1933 Act (“Rule 144A”), to a person whom we reasonably believe after due inquiry is a “qualified institutional
buyer” as defined in Rule 144A, acting for its own account (and not for the account of others) or as a fiduciary or agent for
others (which others also are “qualified institutional buyers”) to whom notice is given that the resale, pledge or transfer
is being made in reliance on Rule 144A or (iv) in a sale, pledge or other transfer made in a transaction otherwise exempt from
the registration requirements of the 1933 Act, in which case the Sponsor shall require that both the prospective transferor and the prospective
transferee certify to the Indenture Trustee and the Sponsor in writing the facts surrounding such transfer, which certification shall
be in form and substance satisfactory to the Issuer and the Sponsor. Except in the case of a transfer described in clauses (i) or
(iii) above, the Sponsor shall require that a written opinion of counsel (which will not be at the expense of the Sponsor, any Affiliate
of the Sponsor, the Owner Trustee or the Indenture Trustee), reasonably satisfactory to the Issuer and the Sponsor, be delivered to the
Issuer, the Owner Trustee, the Indenture Trustee and the Sponsor to the effect that such transfer will not violate the 1933 Act, and will
be effected in accordance with any applicable securities laws of each state of the United States. We will notify any purchaser of the
Retained Notes from us of the above resale restrictions, if then applicable. We further understand that in connection with any transfer
of the Retained Notes by us that the Issuer and the Sponsor may request, and if so requested we will furnish, such certificates and other
information as they may reasonably require to confirm that any such transfer complies with the foregoing restrictions.

 

    	 	C-1	 

     

    

 

2.            [CHECK
ONE]

 

(a)            We
are an Accredited Investor acting for our own account (and not for the account of others) or as a fiduciary or agent for others (which
others also are Accredited Investors unless we are a bank acting in its fiduciary capacity). We have such knowledge and experience in
financial and business matters as to be capable of evaluating the merits and risks of our investment in the Retained Notes, and we and
any accounts for which we are acting are each able to bear the economic risk of our or their investment for an indefinite period of time.
We are acquiring the Retained Notes or investment and not with a view to, or for offer and sale in connection with, a public distribution.

 

(b)            We
are a “qualified institutional buyer” as defined under Rule 144A under the 1933 Act and are acquiring the Retained Notes
for our own account (and not for the account of others) or as a fiduciary or agent for others (which others also are “qualified
institutional buyers”). We are familiar with Rule 144A under the 1933 Act and are aware that the seller of the Retained Notes
and other parties intend to rely on the statements made herein and the exemption from the registration requirements of the 1933 Act provided
by Rule 144A.

 

3.            Either
(a) we are not a Plan (as defined below) that is subject to (i) Title I of the Employee Retirement Income Security Act of 1974,
as amended (“ERISA”), or Section 4975 of the Internal Revenue Code of 1986, as amended (the “Code”)
(each of the foregoing, a “Benefit Plan Investor”), or (ii) a law that is similar to the fiduciary or prohibited
transaction provisions of Title I of ERISA or Section 4975 of the Code (“Similar Law”) or (b) we and our
fiduciary represent and warrant that the acquisition and holding of this Note (or any interest herein) will not give rise to, in the case
of a Benefit Plan Investor, a nonexempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code or, in
the case of a Plan that is subject to Similar Law, a violation of Similar Law. For purposes of the foregoing, the term “Plan”
means an “employee benefit plan” as defined in Section 3(3) of ERISA whether or not subject to Title I of ERISA,
a “plan” as defined in Section 4975 of the Code, or an entity deemed to hold the plan assets of any of the foregoing.

 

4.            We
understand that the Indenture Trustee, the Sponsor and others will rely upon the truth and accuracy of the foregoing acknowledgments,
representations and agreements, and we agree that if any of the acknowledgments, representations and warranties deemed to have been made
by us by our purchase of the Retained Notes, for our own account or for one or more accounts as to each of which we exercise sole investment
discretion, are no longer accurate, we shall promptly notify the Sponsor.

 

5.            You
are entitled to rely upon this letter and you are irrevocably authorized to produce this letter or a copy hereof to any interested party
in any administrative or legal proceeding or official inquiry with respect to the matters covered hereby.

 

    	 	C-2	 

     

    

 

	 	Very truly yours,
	 	 
	 	[NAME OF PURCHASER]
	 	 	 
	 	By:	                 
	 	Name:	 
	 	Title:	 
	 	 	 
	 	Date:	 

 

    	 	C-3	 

     

    

 

EXHIBIT D

 

Servicing Criteria To Be Addressed In Assessment
Of Compliance

 

The assessment of compliance to be delivered by
the Indenture Trustee, shall address, at a minimum, the criteria identified below as “Applicable Servicing Criteria”:

 

		 	Criteria	 	 
	Reference	 	Cash
Collection and Administration
	 	 
	1122(d)(2)(ii)	 	Disbursements made via wire transfer on behalf of an obligor or to an investor are made only by authorized personnel.	 	x
	 	 	 	 	 
	 	 	
Investor
Remittances and Reporting
	 	 
	1122(d)(3)(ii)	 	Amounts due to investors are allocated and remitted in accordance with timeframes, distribution priority and other terms set forth in the transaction agreements.*	 	x
	1122(d)(3)(iii)	 	Disbursements made to an investor are posted within two business days to the Servicer’s investor records, or such other number of days specified in the transaction agreements.	 	x
	1122(d)(3)(iv)	 	Amounts remitted to investors per the investor reports agree with cancelled checks, or other form of payment, or custodial bank statements.	 	x

 

* With respect to remittances.

 

    	 	D-1	 

     

    

 

EXHIBIT E

 

Form of
Monthly Rule 15Ga-1 Asset Repurchase Activity Report

Reporting Period: ____________

Name of Issuing Entity: HAROT 2021-4

Trustee: U.S. Bank National Association

 ̈ Check here if the Trustee has no activity to report during Reporting Period indicated
above

 

	Name
    of

    Issuing

    Entity	Check
    if

    Registered	Name
    of

    Originator	Total
    Assets in 

    ABS by Originator	Assets
    That Were

    Subject of

    Demand	Assets
    That Were

    Repurchased or

    Replaced	Assets
    Pending 

    Repurchase or

    Replacement 

    (within cure period)	Demand
    in Dispute	Demand
    Withdrawn	Demand
    Rejected
	(a)	(b)	(c)	(#)

     

     

     

    (d)
	($)

     

     

     

    (e)
	(%
                                            of principal balance)

     

    (f)
	(#)

     

     

     

    (g)
	($)

     

     

     

    (h)
	(%
                                            of principal balance)

     

    (i)
	(#)

     

     

     

    (j)
	($)

     

     

     

    (k)
	(%
                                            of principal balance)

     

    (l)
	(#)

     

     

     

    (m)
	($)

     

     

     

    (n)
	(%
                                            of principal balance)

     

    (o)
	(#)

     

     

     

    (p)
	($)

     

     

     

    (q)
	(%
                                            of principal balance)

     

    (r)
	(#)

     

     

     

    (s)
	($)

     

     

     

    (t)
	(%
                                            of principal balance)

     

    (u)
	(#)

     

     

     

    (v)
	($)

     

     

     

    (w)
	(%
                                            of principal balance)

     

    (x)

	Asset
    Class X	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Issuing
    Entity A CIK #	X	Originator
    1	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Originator
    2	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Total	 	 	#	$	 	#	$	 	#	$	 	#	$	 	#	$	 	#	$	 	#	$	 
	Asset
    Class Y	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Issuing
    Entity B	 	Originator
    3	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Total	 	 	#	$	 	#	$	 	#	$	 	#	$	 	#	$	 	#	$	 	#	$	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Total	 	 	#	$	 	#	$	 	#	$	 	#	$	 	#	$	 	#	$	 	#	$	 

 

    	 	E-1

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