Document:

exv10w3

 

EXHIBIT 10.3

EXECUTION VERSION

 

STOCKHOLDER AGREEMENT

by and between

VIACOM INTERNATIONAL INC.,

on behalf of its MTV NETWORKS Division,

and

REALNETWORKS, INC.

Dated as of August 20, 2007

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 
	 	 	 	 	Page
	 

	 	ARTICLE I	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Definitions	 	 	 	 
	 
	 	 	 	 	 	 
	SECTION 1.01.

	 	Definitions
	 	 	4	 
	 
	 	 	 	 	 	 
	 

	 	ARTICLE II	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Registration Rights	 	 	 	 
	 
	 	 	 	 	 	 
	SECTION 2.01.

	 	Registration
	 	 	9	 
	SECTION 2.02.

	 	Piggyback Registration
	 	 	11	 
	SECTION 2.03.

	 	Reduction of Offering
	 	 	11	 
	SECTION 2.04.

	 	Registration Procedures
	 	 	12	 
	SECTION 2.05.

	 	Information and Developments
	 	 	16	 
	SECTION 2.06.

	 	Black-out Period
	 	 	17	 
	SECTION 2.07.

	 	Registration Expenses
	 	 	17	 
	SECTION 2.08.

	 	Indemnification; Contribution
	 	 	17	 
	SECTION 2.09.

	 	Rule 144
	 	 	20	 
	SECTION 2.10.

	 	Lock-Up
	 	 	20	 
	SECTION 2.11.

	 	Other Registration Rights
	 	 	20	 
	 
	 	 	 	 	 	 
	 

	 	ARTICLE III	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Access to Information	 	 	 	 
	 
	 	 	 	 	 	 
	SECTION 3.01.

	 	Access to Information
	 	 	21	 
	 
	 	 	 	 	 	 
	 

	 	ARTICLE IV	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Standstill	 	 	 	 
	 
	 	 	 	 	 	 
	SECTION 4.01.

	 	Standstill
	 	 	21	 
	SECTION 4.02.

	 	Exceptions to Standstill
	 	 	22	 
	SECTION 4.03.

	 	Fiduciary Duties
	 	 	23	 
	 
	 	 	 	 	 	 
	 

	 	ARTICLE V	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Transfer Restrictions	 	 	 	 
	 
	 	 	 	 	 	 
	SECTION 5.01.

	 	Restrictions on Transfer
	 	 	23	 

ii

 

 

	 	 	 	 	 	 	 
	 	 	 	 	Page
	 
	 	 	 	 	 	 
	 

	 	ARTICLE VI	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Miscellaneous	 	 	 	 
	 
	 	 	 	 	 	 
	SECTION 6.01.

	 	Effectiveness and Termination
	 	 	23	 
	SECTION 6.02.

	 	Interpretation
	 	 	24	 
	SECTION 6.03.

	 	Adjustments
	 	 	24	 
	SECTION 6.04.

	 	Commercially Reasonable Efforts; Further Actions
	 	 	24	 
	SECTION 6.05.

	 	Consents
	 	 	24	 
	SECTION 6.06.

	 	Notices
	 	 	24	 
	SECTION 6.07.

	 	No Third Party Beneficiaries
	 	 	26	 
	SECTION 6.08.

	 	Waiver
	 	 	26	 
	SECTION 6.09.

	 	Integration
	 	 	26	 
	SECTION 6.10.

	 	Headings
	 	 	26	 
	SECTION 6.11.

	 	Counterparts
	 	 	27	 
	SECTION 6.12.

	 	Severability
	 	 	27	 
	SECTION 6.13.

	 	Amendments and Modifications
	 	 	27	 
	SECTION 6.14.

	 	Applicable Law
	 	 	27	 
	SECTION 6.15.

	 	Dispute Resolution
	 	 	27	 
	SECTION 6.16.

	 	Waiver of Jury Trial
	 	 	27	 
	SECTION 6.17.

	 	Absence of Presumption
	 	 	27	 
	SECTION 6.18.

	 	Expenses
	 	 	27	 
	SECTION 6.19.

	 	Articles of Incorporation and By-Laws
	 	 	27	 
	SECTION 6.20.

	 	Change in Law
	 	 	28	 
	 
	 	 	 	 	 	 
	SCHEDULE I

	 	Dispute Resolution	 	 	 	 

iii

 

 

     STOCKHOLDER AGREEMENT dated as of August 20, 2007 (this
“Agreement”), between Viacom International Inc., a Delaware
corporation, (“MTVN Parent”), on behalf of its MTV Networks
Division (“MTVN”), and RealNetworks, Inc. (“RealNetworks”),
a Washington corporation.

     WHEREAS, MTVN Parent, DMS Holdco Inc., RealNetworks, RealNetworks Digital Music of California,
Inc. and Rhapsody America LLC have entered into a Limited Liability Company Agreement (the “LLC
Agreement”), dated as of the date of this Agreement, pursuant to which, on the Closing Date (as
defined in Section 1.01(a)), MTVN and RealNetworks will launch a joint venture;

     WHEREAS, the parties hereto desire to establish in this Agreement certain terms and conditions
concerning registration, access to information rights and standstill and transfer restrictions
relating to any Equity Securities of RealNetworks Beneficially Owned (as such terms are defined in
Section 1.01(a)) by MTVN and certain other matters;

     WHEREAS, this Agreement shall become effective upon the closing of a put/call pursuant to
Section 10.03 of the LLC Agreement in which Equity Securities of RealNetworks are issued to MTVN or
its Affiliates.

     NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein and
for other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties agree as follows:

ARTICLE I

Definitions

     SECTION 1.01. Definitions. (a) As used in this Agreement, the following terms will
have the following meanings:

     An “Affiliate” of any Person means another Person that directly or indirectly, through
one or more intermediaries, Controls, is Controlled by, or is under common Control with, such first
Person; provided that “Affiliate”, when used with respect to MTVN or MTVN Parent or
any of their Affiliates, shall only mean Viacom Parent and any direct or indirect Subsidiaries of
Viacom Parent and shall not include any direct or indirect stockholder of Viacom Parent or any of
their Affiliates other than Viacom Parent and any direct or indirect Subsidiaries of Viacom Parent.

     “Articles of Incorporation” means the articles of incorporation of RealNetworks, as
amended from time to time in accordance with this Agreement.

     “Beneficial Owner” and “Beneficial Ownership” and words of similar import have
the meanings assigned to such terms in the LLC Agreement.

 

5

     “Board” means the Board of Directors of RealNetworks.

     “Business Combination” means any direct or indirect acquisition or purchase, in one
transaction or a series of transactions, of assets (including Equity Securities of any Subsidiary
of RealNetworks) or businesses that constitute 20% or more of the revenues, net income or assets of
RealNetworks and its Subsidiaries, taken as a whole, or 20% or more of the shares of any class of
Equity Securities of RealNetworks, or any acquisition, tender offer or exchange offer that if
consummated would result in any Person Beneficially Owning 20% or more of the shares of any class
of Equity Securities of RealNetworks, or any merger, consolidation, business combination,
recapitalization, liquidation, dissolution, joint venture, binding share exchange or similar
transaction involving RealNetworks or any of its Subsidiaries pursuant to which any Person or the
shareholders of any Person would own 20% or more of the shares of any class of Equity Securities of
RealNetworks or of any resulting parent company of RealNetworks.

     “Business Day” means any day other than a Saturday, a Sunday or a U.S. Federal
holiday.

     “By-laws” means the by-laws of RealNetworks, as amended from time to time in
accordance with this Agreement.

     “Closing” has the meaning assigned in the LLC Agreement.

     “Closing Date” means the date of the Closing.

     “Common Stock” means the Common Stock, par value $0.001 per share, of RealNetworks.

     “Control” means, with respect to any Person, the possession, directly or indirectly,
of the power to direct or cause the direction of the management or policies of such Person, whether
through ownership of securities or partnership, membership, limited liability company, or other
ownership interests, by contract or otherwise and the terms “Controlling” and
“Controlled” have meanings correlative to the foregoing.

     “Director” means a member of the Board.

     “Equity Security” means (i) any common stock, preferred stock or other capital stock,
(ii) any securities convertible into or exchangeable for common stock, preferred stock or other
capital stock or (iii) any options, rights or warrants (or any similar securities) to acquire
common stock, preferred stock or other capital stock.

     “Exchange Act” means the Securities Exchange Act of 1934 and the rules and regulations
promulgated thereunder, as amended.

     “GAAP” means U.S. generally accepted accounting principles, as in effect at the time
such term is relevant.

 

6

     “Governmental Entity” means any transnational, Federal, state, local or foreign
government, or any court of competent jurisdiction, administrative agency or commission or other
governmental authority or instrumentality, domestic or foreign, or any national stock exchange or
national quotation system on which securities issued by RealNetworks or any of its Subsidiaries are
listed or quoted.

     “Group” has the meaning assigned to such term in Section 13(d)(3) of the Exchange Act.

     “Issuer FWP” has the meaning assigned to “issuer free writing prospectus” in Rule 433
under the Securities Act.

     “Law” means any law, treaty, statute, ordinance, code, rule, regulation, judgment,
decree, order, writ, award, injunction, authorization or determination enacted, entered,
promulgated, enforced or issued by any Governmental Entity.

     “MTVN Music Group” shall have the meaning assigned in the Audio Music Service Brand
and Content License, Distribution and Advertising Agreement dated as of August 20, 2007, between
MTVN and Rhapsody America LLC.

     “NASDAQ” shall mean The NASDAQ Stock Market, Inc.

     “Non-Voting Equity” has the meaning assigned in the LLC Agreement.

     “Outstanding Percentage Interest” of any Person means, as of any date of
determination, the ratio expressed as a percentage of (x) the sum of the number of shares of Common
Stock and Non-Voting Equity Beneficially Owned by such Person and its Affiliates as of such date to
(y) the total number of shares of Common Stock and Non-Voting Equity outstanding as of such date.

     “Permitted Transferee” means Viacom Parent and any Subsidiary of Viacom Parent.

     “Person” means any individual, firm, corporation, partnership, company, limited
liability company, trust, joint venture, association, Governmental Entity, unincorporated
organization or other entity.

     “Registrable Securities” means (a) all shares of Common Stock and Non-Voting Equity
Beneficially Owned at any time by MTVN and its Affiliates, (b) any securities issued or issuable
with respect to any such shares of Common Stock and Non-Voting Equity by way of a stock dividend or
other similar distribution or stock split, or in connection with a combination of shares,
recapitalization, merger, consolidation or other reorganization or otherwise and (c) shares of
Common Stock issuable pursuant to any option, warrant, right, put, call or other derivative
security of any of the foregoing; provided that such securities will cease to be
Registrable Securities when (i) a Registration Statement relating to such securities will have been
declared effective by the SEC (or become automatically effective) and such securities will have
been disposed of by MTVN pursuant to such Registration Statement or pursuant to a Takedown Offering

 

7

related to such Registration Statement; (ii) such securities have been disposed of by MTVN
pursuant to Rule 144 promulgated under the Securities Act or (iii) such securities may be disposed
of without registration under the Securities Act by MTVN pursuant to Rule 144(k) promulgated under
the Securities Act.

     “Representatives” means the directors, officers, employees, agents, investment
bankers, financing sources, attorneys, accountants and advisors of either MTVN, on the one hand, or
RealNetworks, on the other hand, as the context requires.

     “Sale Transaction” means (i) any merger, consolidation or binding share exchange to
which MTVN, MTVN Parent or Viacom Parent is a party, (ii) any sale of Equity Securities or sale of
all or substantially all of the assets of MTVN, MTVN Parent or Viacom Parent or (iii) any
transaction involving all or substantially all of the assets of the MTVN Music Group.

     “SEC” means the U.S. Securities and Exchange Commission.

     “Securities Act” means the Securities Act of 1933 and the rules and regulations
promulgated thereunder, as amended.

     A “Subsidiary” of any Person means another Person (a) an amount of the voting
securities, other voting ownership or voting partnership interest of which is sufficient to elect
at least a majority of its board or other governing body (or, if there are no such voting
interests, 50% or more of the equity interests of which is Beneficially Owned directly or
indirectly by such first Person) or (b) which is required to be consolidated with such Person under
GAAP.

     “Takedown Offering” means an offering pursuant to a shelf registration statement.

     “Trading Day” means (i) for so long as any Equity Securities of RealNetworks are
quoted on NASDAQ or another national securities exchange, a day on which NASDAQ or such other
national securities exchange is open for business or (ii) if the Equity Securities of RealNetworks
cease to be so quoted, any day other than a Saturday or Sunday or a day on which banking
institutions in the State of New York are authorized or obligated by Law or executive order to
close.

     “Transfer” means, directly or indirectly, to sell, transfer, assign or similarly
dispose of, or to enter into any hedging or derivative transaction to indirectly accomplish any of
the foregoing, but shall not include (x) a bona fide pledge to a financial institution to secure a
bona fide recourse borrowing or any foreclosure thereof or (y) an indirect transfer incident to a
Sale Transaction. The terms “Transferred”, “Transferring”, “Transferor”
and “Transferee” have meanings correlative to the foregoing.

     “Underwriter” means a securities dealer who purchases any Registrable Securities as a
principal in connection with a distribution of such Registrable Securities and not as part of such
dealer’s market-making activities.

 

8

     “Voting Stock” has the meaning assigned to such term in the LLC Agreement.

     “Viacom Parent” means Viacom Inc., a Delaware corporation.

     (b) As used in this Agreement, the terms set forth below will have the meanings assigned in
the corresponding Section listed below:

	 	 	 
	Term	 	Section
	Agreement
	 	Preamble
	 
	Deferral Period
	 	2.06
	 
	Demand Registration
	 	2.01(a)
	 
	effective date
	 	2.04(a)(xi)
	 
	fraudulent misrepresentation
	 	2.08(e)
	 
	indemnified party
	 	2.08(c)
	 
	Indemnified Persons
	 	2.08(a)
	 
	indemnifying party
	 	2.08(c)
	 
	Inspectors
	 	2.04(a)(vii)
	 
	LLC Agreement
	 	Recitals
	 
	MTVN
	 	Preamble
	 
	Piggyback Registration
	 	2.02
	 
	RealNetworks
	 	Preamble
	 
	Records
	 	2.04(a)(vii)
	 
	Registration Statement
	 	2.01(a)
	 
	Takedown Request
	 	2.01(b)
	 
	MTVN Parent
	 	Preamble

 

9

ARTICLE II

Registration Rights

     SECTION 2.01. Registration. (a) RealNetworks agrees that, upon the written request
of MTVN from time to time (a “Demand Registration”), it will as promptly as reasonably
practical (but in any event within 30 days of receipt of such request) prepare and file a
registration statement under the Securities Act (a “Registration Statement”, which term
will include any amendments thereto and any documents incorporated by reference therein), which
registration statement, if MTVN so requests, will be a shelf registration statement on an
appropriate form under the Securities Act, relating to the offer and sale of the Registrable
Securities by MTVN or its Affiliates from time to time in accordance with the methods of
distribution set forth in such shelf registration statement and Rule 415 under the Securities Act
as to the number of shares of Registrable Securities specified in such request; provided
that (i) RealNetworks will not be obligated to effect (x) a Demand Registration if a Registration
Statement pursuant to this Section 2.01 or Section 2.02 in which MTVN had the right to include
Registrable Securities was declared effective within 12-months prior to the date of the request for
a Demand Registration, so long as the number of Registrable Securities which MTVN requested to
include in such Registration Statement was not reduced pursuant to Section 2.03 or (y) more than a
total of four Demand Registrations during the period commencing on the date hereof and ending on
the date on which MTVN and its Affiliates no longer own any Registrable Securities and (ii) the
Registrable Securities for which a Demand Registration has been requested will have a value (based
on the average closing price per share of the Common Stock (or any successor security) for the ten
Trading Days preceding the delivery of MTVN’s request for such Demand Registration) of not less
than $75,000,000 or such lesser remaining amount held by MTVN. Each such request for a Demand
Registration will specify the number of shares of Registrable Securities proposed to be offered for
sale and will also specify the intended method of distribution thereof; provided that MTVN
may change such number if such change (x) will not materially adversely affect the timing or
success of the offering and (y) does not result in less than $75,000,000 or such lesser amount
(determined as provided above) of Registrable Securities being included in the Registration
Statement.

     (b) RealNetworks agrees that, upon the written request of MTVN from time to time (a
“Takedown Request”) to assist it in effecting a Takedown Offering pursuant to a shelf
registration statement that has previously been filed and declared effective pursuant to a Demand
Registration, it will as promptly as reasonably practicable cooperate with MTVN and any
Underwriters to effect such Takedown Offering. The Takedown Request will specify the number of
Registrable Securities to be included by MTVN in such Takedown Offering and the intended method of
distribution.

     (c) RealNetworks agrees to use its commercially reasonable efforts (i) to cause any
Registration Statement to be declared effective (unless it becomes effective automatically upon
filing) as promptly as reasonably practicable after the filing thereof and (ii) to keep such
Registration Statement effective for a period of not less than 90 days (or, in the case of a shelf
registration statement, two years) or, if earlier, the period

 

10

sufficient to complete the distribution of the Registrable Securities pursuant to a Takedown
Offering related to, or otherwise pursuant to, such Registration Statement. RealNetworks shall be
deemed not to have used its commercially reasonable efforts to keep a Registration Statement
effective during the requisite period if it voluntarily takes any action that would result in MTVN
not being able to offer and sell the Registrable Securities during that period (including in
connection with a Takedown Offering), unless such action is required by applicable Law or is
pursuant to Section 2.06. RealNetworks further agrees to supplement or make amendments to the
Registration Statement as may be necessary to keep such Registration Statement effective for the
period set forth in clause (ii) above, including (A) to respond to the comments of the SEC, if any,
(B) as may be required by the registration form utilized by RealNetworks for such Registration
Statement or by the instructions applicable to such registration form, (C) as may be required by
the Securities Act or the rules and regulations thereunder, (D) as may be required in connection
with a Takedown Offering or (E) as may be reasonably requested in writing by MTVN or any
Underwriter for MTVN. RealNetworks agrees, at least ten days before filing with the SEC a
Registration Statement or prospectus and at least two days before filing with the SEC any
amendments or supplements thereto, to furnish to the Underwriters, if any, to MTVN, and to one
counsel selected by MTVN, copies of all such documents proposed to be filed, which documents shall
be subject to the review and reasonable comments of such Persons.

     (d) In the event an offering of shares of Registrable Securities (including in connection with
any Takedown Offering) involves one or more Underwriters, MTVN will select the lead bookrunning
Underwriter and any additional Underwriters in connection with the offering, subject to the
reasonable approval of RealNetworks.

     (e) Notwithstanding the foregoing provisions of this Section 2.01, MTVN may not request a
Demand Registration or deliver a Takedown Request during a period commencing upon filing (or
earlier, but not more than 30 days prior to such filing upon notice by RealNetworks to MTVN that it
so intends to file) a Registration Statement for Equity Securities of RealNetworks (for its own
account or for any other security holder) and ending (i) 90 days after such Registration Statement
is declared effective by the SEC (or becomes automatically effective) or up to 180 days in the case
of an underwriting if and to the extent requested by the lead underwriter, (ii) upon the withdrawal
of such Registration Statement or (iii) 30 days after such notice if no such Registration Statement
has been filed within such 30-day period, whichever occurs first; provided the foregoing
limitation will not apply if MTVN was not given the opportunity, in violation of Section 2.01(a) or
2.02, to include its Registrable Securities in the Registration Statement described in this
Section 2.01(e); and, provided, further, that in no event will MTVN be restricted
hereunder for more than 180 days in any 12-month period (including, for purposes hereof,
restrictions under Section 2.10).

     (f) MTVN will be permitted to rescind a Demand Registration or Takedown Request or remove any
Registrable Securities held by it from any Demand Registration or Takedown Request (so long as, in
the case of a Demand Registration, after such removal it would still constitute a Demand
Registration) at any time; provided that if MTVN rescinds a Demand Registration, such
Demand Registration will

 

11

nonetheless count as a Demand Registration for purposes of determining when future Demand
Registrations can be requested by MTVN pursuant to this Section 2.01, unless MTVN reimburses
RealNetworks for all expenses incurred by RealNetworks in connection with such Demand Registration.

     SECTION 2.02. Piggyback Registration. If RealNetworks proposes to file a Registration
Statement under the Securities Act, or consummate a Takedown Offering, with respect to an offering
of Equity Securities of RealNetworks for (a) RealNetworks’ own account (other than a Registration
Statement on Form S-4 or S-8 (or any substitute form that may be adopted by the SEC)) or (b) the
account of any holders of Equity Securities of RealNetworks (other than MTVN) pursuant to a demand
registration request or takedown request delivered by such holders, then RealNetworks will give
written notice of such proposed filing or Takedown Offering to MTVN as soon as practicable (but in
no event less than 20 days before the anticipated filing date), and upon the written request, given
within 15 days after delivery of any such notice by RealNetworks, of MTVN to include in such
registration or Takedown Offering, as applicable, Registrable Securities (which request shall
specify the number of Registrable Securities proposed to be included in such registration or
Takedown Offering, as applicable), RealNetworks will cause all such Registrable Securities to be
included in such registration or Takedown Offering, as applicable, on the same terms and conditions
as RealNetworks’ or such holder’s Equity Securities of RealNetworks (a “Piggyback
Registration”); provided, however, that if at any time after giving written
notice of such proposed filing or Takedown Offering, as applicable, and prior to the effective date
of the Registration Statement filed in connection with such registration, or the consummation of
such Takedown Offering, as applicable, RealNetworks shall determine for any reason not to proceed
with the proposed registration or disposition, as applicable, of the securities, RealNetworks may,
at its election, give written notice of such determination to MTVN and, thereupon, will be relieved
of its obligation to register any Registrable Securities in connection with such registration, or
dispose of any Registrable Securities in connection with such Takedown Offering, as applicable.
RealNetworks will control the determination of the form of any offering contemplated by this
Section 2.02, including whether any such offering will be in the form of an underwritten offering
and, if any such offering is in the form of an underwritten offering, RealNetworks will select the
lead Underwriter and any additional Underwriters in connection with such offering. RealNetworks
will use its commercially reasonable efforts to cause any such Registration Statement to be
effective for at least 90 days.

     SECTION 2.03. Reduction of Offering. Notwithstanding anything contained herein, if
the lead Underwriter of an underwritten offering described in Section 2.01 or Section 2.02 advises
RealNetworks in writing that the number of Equity Securities of RealNetworks (including any
Registrable Securities) that RealNetworks, MTVN and any other Persons intend to include in any
Registration Statement or dispose of pursuant to any Takedown Offering is such that the success of
any such offering would be materially and adversely affected, including the price at which the
securities can be sold, then the number of Equity Securities of RealNetworks to be included in the
Registration Statement, or disposed of pursuant to such Takedown Offering, as applicable, for the
account of RealNetworks, MTVN and any other Persons will be

 

12

reduced pro rata to the extent necessary to reduce the total amount of securities to be
included in any such Registration Statement, or disposed of pursuant to such Takedown Offering, as
applicable, to the amount recommended by such lead Underwriter; provided that (a) priority
in the case of a Demand Registration or Takedown Offering pursuant to Section 2.01 will be
(i) first, the Registrable Securities requested to be included in the Registration
Statement, or disposed of pursuant to the Takedown Offering, as applicable, for the account of MTVN
and its Affiliates, (ii) second, securities initially proposed to be offered by
RealNetworks for its own account and (iii) third, pro rata among any other securities of
RealNetworks requested to be registered, or disposed of, as applicable, by the holders thereof
pursuant to a contractual right so that the total number of registrable securities to be included
in any such offering for the account of all such Persons will not exceed the number recommended by
such lead Underwriter; (b) priority in the case of a Piggyback Registration initiated by
RealNetworks for its own account pursuant to Section 2.02 will be (i) first, securities
initially proposed to be offered by RealNetworks for its own account, and (ii) second, pro
rata among the Registrable Securities requested to be included in the Registration Statement, or
disposed of pursuant to the Takedown Offering, as applicable, for the account of MTVN and its
Affiliates, and any other securities of RealNetworks requested to be registered, or disposed of, as
applicable, pursuant to a contractual right so that the total number of registrable securities to
be included in any such offering for the account of all such Persons will not exceed the number
recommended by such lead Underwriter; and (c) priority with respect to inclusion of securities in a
Registration Statement or Takedown Offering, as applicable, initiated by RealNetworks for the
account of holders other than MTVN pursuant to registration rights afforded such holders will be
(i) first, pro rata among securities offered for the account of such holders so that the
total number of registrable securities to be included in any such offering for the account of all
such Persons will not exceed the number recommended by such lead Underwriter, (ii) second,
securities offered by RealNetworks for its own account, and (iii) third, pro rata among the
Registrable Securities requested to be included in the Registration Statement, or disposed of
pursuant to the Takedown Offering, for the account of MTVN, and any other securities of
RealNetworks requested to be registered pursuant to a contractual right so that the total number of
registrable securities to be included in any such offering for the account of all such Persons will
not exceed the number recommended by such lead Underwriter.

     SECTION 2.04. Registration Procedures. (a)  Subject to the provisions of Section 2.01
hereof, in connection with the registration of the sale of Registrable Securities or any Takedown
Offering hereunder, RealNetworks will as promptly as reasonably practicable:

     (i) furnish to MTVN without charge, if requested, prior to the filing of a
Registration Statement, copies of such Registration Statement as it is proposed to
be filed, and thereafter such number of copies of such Registration Statement, each
amendment and supplement thereto (in each case including all exhibits thereto and
documents incorporated by reference therein), the prospectus included in such
Registration Statement (including each preliminary prospectus), copies of any and
all transmittal letters or other correspondence with the SEC relating to such
Registration

 

13

Statement and such other documents in such quantities as MTVN may reasonably
request from time to time in order to facilitate the disposition of such
Registrable Securities (including in connection with any Takedown Offering);

     (ii) use its commercially reasonable efforts to register or qualify such
Registrable Securities under such other securities or blue sky laws of such
jurisdictions as MTVN reasonably requests and do any and all other acts and things
as may be reasonably necessary or advisable to enable MTVN to consummate the
disposition of such Registrable Securities in such jurisdictions (including in
connection with any Takedown Offering); provided that RealNetworks will not
be required to (x) qualify generally to do business in any jurisdiction where it
would not otherwise be required to qualify but for this Section 2.04(a)(ii),
(y) subject itself to taxation in any such jurisdiction or (z) consent to general
service of process in any such jurisdiction;

     (iii) notify MTVN at any time when a prospectus relating to Registrable
Securities is required to be delivered under the Securities Act, of the happening
of any event as a result of which the prospectus included in a Registration
Statement or amendment or supplement relating to such Registrable Securities
contains an untrue statement of a material fact or omits to state any material fact
required to be stated therein or necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading, and
RealNetworks will promptly prepare and file with the SEC a supplement or amendment
to such prospectus and Registration Statement (and comply with the applicable
provisions of Rules 424, 430A and 430B under the Securities Act) in a timely manner
so that, as thereafter delivered to the purchasers of the Registrable Securities,
such prospectus and Registration Statement will not contain an untrue statement of
a material fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances under
which they were made, not misleading;

     (iv) advise the Underwriter, if any, and MTVN promptly and, if requested by
such Persons, confirm such advice in writing, of the issuance by the SEC of any
stop order suspending the effectiveness of the Registration Statement under the
Securities Act or of the suspension by any state securities commission of the
qualification of the Registrable Securities for offering or sale in any
jurisdiction, or the initiation of any proceeding for any of the preceding
purposes. If at any time the SEC shall issue any stop order suspending the
effectiveness of the Registration Statement, or any state securities commission or
other regulatory authority shall issue an order suspending the qualification or
exemption from qualification of the Registrable Securities under state securities
or blue sky laws, RealNetworks shall use its commercially reasonable efforts to
obtain the withdrawal or lifting of such order at the earliest possible time;

 

14

     (v) use its commercially reasonable efforts to cause such Registrable
Securities to be registered with or approved by such other Governmental Entities as
may be necessary by virtue of the business and operations of RealNetworks to enable
MTVN to consummate the disposition of such Registrable Securities (including in
connection with any Takedown Offering); provided that RealNetworks will not
be required to (x) qualify generally to do business in any jurisdiction where it
would not otherwise be required to qualify but for this Section 2.04(a)(v),
(y) subject itself to taxation in any such jurisdiction or (z) consent to general
service of process in any such jurisdiction;

     (vi) enter into agreements and use commercially reasonable efforts to take
such other actions as are reasonably requested by MTVN in order to expedite or
facilitate the disposition of such Registrable Securities (including in connection
with any Takedown Offering), including preparing for and participating in, such
number of road shows and all such other customary selling efforts as the
Underwriters reasonably request in order to expedite or facilitate such
disposition;

     (vii) make available for inspection by MTVN, any Underwriter participating in
any disposition of such Registrable Securities (including in any Takedown
Offering), and any attorney for MTVN and the Underwriter and any accountant or
other agent retained by MTVN or any such Underwriter (collectively, the
“Inspectors”), all financial and other records, pertinent corporate
documents and properties of RealNetworks (collectively, the “Records”) as
will be reasonably necessary to enable them to conduct customary due diligence with
respect to RealNetworks and the related Registration Statement and prospectus, and
cause the Representatives of RealNetworks and its Subsidiaries to supply all
information reasonably requested by any such Inspector in connection with such
disposition; provided that (x) Records and information obtained hereunder
will be used by such Inspector only to conduct such due diligence, and (y) Records
or information that RealNetworks determines, in good faith, to be confidential will
not be disclosed by such Inspector unless (A) the disclosure of such Records or
information is necessary to avoid or correct a material misstatement or omission in
a Registration Statement or related prospectus or (B) the release of such Records
or information is ordered pursuant to a subpoena or other order from a court or
Governmental Entity with competent jurisdiction;

     (viii) (1) cause RealNetworks’ Representatives to supply all information
reasonably requested by MTVN, or any Underwriter, attorney, accountant or agent in
connection with the Registration Statement or Takedown Offering pursuant to the
Registration Statement and (2) provide MTVN and its counsel with the opportunity to
participate in the preparation of such Registration Statement and the related
prospectus;

 

15

     (ix) use its commercially reasonable efforts to obtain and deliver to each
Underwriter and, if consented to by the accountants referred to below, MTVN, a
comfort letter from the independent public accountants for RealNetworks (and
additional comfort letters from independent public accountants for any company
acquired by RealNetworks whose financial statements are included or incorporated by
reference in the Registration Statement) in customary form and covering such
matters of the type customarily covered by comfort letters as such Underwriter and
MTVN may reasonably request, including (x) that the financial statements included
or incorporated by reference in the Registration Statement or the prospectus, or
any amendment or supplement thereof, comply as to form in all material respects
with the applicable accounting requirements of the Securities Act and (y) as to
certain other financial information for the period ending no more than five
Business Days prior to the date of such letter; provided, however,
that if RealNetworks fails to obtain such comfort letter for any Underwriter and
the proposed offering is terminated, then such Demand Registration will not count
as a Demand Registration for purposes of determining when future Demand
Registrations can be requested by MTVN pursuant to Section 2.01;

     (x) use its commercially reasonable efforts to obtain and deliver to each
Underwriter a 10b-5 statement and legal opinion from RealNetworks’ counsel in
customary form and covering such matters as are customarily covered by 10b-5
statements and legal opinions as such Underwriter may reasonably request, including
(1) that the Registration Statement relating to such Registrable Securities has
been declared effective (or become automatically effective) under the Securities
Act, (2) to the knowledge of such counsel, no stop order suspending the
effectiveness thereof has been issued and no proceedings for that purpose have been
instituted or are pending or contemplated under the Securities Act,
(3) RealNetworks is not an ineligible issuer within the meaning of Rule 405 under
the Securities Act, (4) such Registration Statement, the related prospectus and
each amendment or supplement thereto comply as to form in all material respects
with the requirements of the Securities Act (except that such counsel need not
express any opinion as to financial information contained therein) and (5) as of an
applicable time identified by MTVN, the Registration Statement, any related
prospectus and the disclosure package (as identified by MTVN or such Underwriter),
do not contain any untrue statement of a material fact or omission to state a
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; provided, however, that if RealNetworks fails to obtain
such statement or opinion and the proposed offering is terminated, then such Demand
Registration will not count as a Demand Registration for purposes of determining
when future Demand Registrations can be requested by MTVN pursuant to Section 2.01;

 

16

     (xi) otherwise use its commercially reasonable efforts to comply with all
applicable rules and regulations of the SEC, and make generally available to its
security holders, within the required time period, an earnings statement covering a
period of 12 months, beginning with the first fiscal quarter after the effective
date of the Registration Statement relating to such Registrable Securities (as the
term “effective date” is defined in Rule 158(c) under the Securities Act),
which earnings statement will satisfy the provisions of Section 11(a) of the
Securities Act and Rule 158 thereunder or any successor provisions thereto; and

     (xii) use its commercially reasonable efforts to cause such Registrable
Securities to be listed or quoted on NASDAQ and each other securities exchange or
national quotation system on which similar securities issued by RealNetworks are
listed or quoted.

     (b) In connection with the Registration Statement relating to such Registrable Securities
covering an underwritten offering (including any Takedown Offering), RealNetworks and MTVN agree to
enter into a written agreement with each Underwriter selected in the manner herein provided in such
form and containing such provisions (including as to indemnification and contribution) as are
customary in the securities business for such an arrangement between such Underwriter and companies
of RealNetworks’ size and investment stature at the time of the offering (it being understood that
RealNetworks will not require MTVN to make any representation, warranty or agreement in such
agreement other than with respect to MTVN, the ownership of MTVN’s securities being registered and
MTVN’s intended method of disposition). The representations and warranties by, and the other
agreements on the part of, RealNetworks to and for the benefit of such Underwriter in such written
agreement with such Underwriter will also be made to and for the benefit of MTVN. In the event
that any condition to the obligations under any such written agreement with such Underwriter are
not met or waived in connection with a Demand Registration, and such failure to be met or waived is
not attributable to the fault of MTVN but is attributable to the failure of any condition relating
to RealNetworks, the delivery of documents, certificates, lock-up agreements, opinions or comfort
letters on behalf of RealNetworks, “market out” conditions, listing or quotation of the Registrable
Securities, regulatory approvals, legal or regulatory restraints or tax matters, and the proposed
offering is terminated as a result thereof, such Demand Registration will not be deemed to have
been utilized.

     SECTION 2.05. Information and Developments. (a) RealNetworks may require MTVN to
furnish to RealNetworks such information regarding MTVN or the distribution of such Registrable
Securities as RealNetworks may from time to time reasonably request in writing, in each case only
as required by the Securities Act or the rules and regulations thereunder or under state securities
or blue sky laws.

     (b) MTVN agrees that, upon receipt of any notice from RealNetworks of the happening of any
event of the kind described in Section 2.04(a)(iii) hereof or a condition described in Section 2.06
hereof, MTVN will forthwith discontinue disposition of such Registrable Securities pursuant to the
Registration Statement covering the sale of

 

17

such Registrable Securities, or Takedown Offering, until MTVN’s receipt of the copies of the
supplemented or amended prospectus contemplated by Section 2.04(a)(iii) hereof or notice from
RealNetworks of the termination of the Deferral Period.

     SECTION 2.06. Black-out Period. RealNetworks’ obligations to file or maintain the
effectiveness of a Registration Statement pursuant to Section 2.01 and Section 2.02 hereof will be
suspended if compliance with such obligations would require RealNetworks to disclose a material
financing, acquisition, disposition or other similar corporate development or other materially
adverse nonpublic information concerning RealNetworks, in each case which RealNetworks is not
otherwise required to disclose at such time, and the Board has reasonably determined that such
disclosure would be significantly disadvantageous to RealNetworks, in which case RealNetworks shall
furnish to MTVN a resolution of the Board stating that RealNetworks is delaying compliance with
such obligations pursuant to this Section 2.06 and setting forth in reasonable detail the reasons,
subject to any confidentiality obligations; provided that any such suspension will not
exceed 120 days and all such suspensions will not exceed 180 days in any 12-month period (the
“Deferral Period”). RealNetworks will promptly give MTVN written notice of any such
suspension containing the approximate length of the anticipated delay, and RealNetworks will notify
MTVN upon the termination of the Deferral Period.

     SECTION 2.07. Registration Expenses. All fees and expenses incident to RealNetworks’
performance of or compliance with the obligations of this Article II, including all fees and
expenses of compliance with securities or blue sky laws (including reasonable fees and
disbursements of counsel for any Underwriters in connection with blue sky qualifications of
Registrable Securities), printing expenses, messenger and delivery expenses of RealNetworks, any
registration or filing fees payable under any Federal or state securities or blue sky laws, the
fees and expenses incurred in connection with any listing or quoting of the securities to be
registered on any national securities exchange or automated quotation system, fees of the National
Association of Securities Dealers, Inc., fees and disbursements of counsel for RealNetworks, fees
of its independent certified public accountants and any other public accountants who are required
to deliver comfort letters (including the expenses required by or incident to such performance),
transfer taxes, fees of transfer agents and registrars, costs of insurance, reasonable fees and
expenses of one counsel (in addition to any local counsel) for MTVN and the fees and expenses of
other Persons retained by RealNetworks, and any fees and expenses incurred in connection with a
Takedown Offering, will be borne by RealNetworks. MTVN will bear and pay any underwriting
discounts and commissions applicable to Registrable Securities offered for its account pursuant to
any Registration Statement (including in connection with any Takedown Offering).

     SECTION 2.08. Indemnification; Contribution. (a) In connection with any registration
of Registrable Securities or Takedown Offering pursuant to Section 2.01 or Section 2.02 hereof,
RealNetworks agrees to indemnify and hold harmless, to the fullest extent permitted by Law, MTVN,
its Affiliates, directors, officers and stockholders and each Person who controls MTVN within the
meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act (collectively,
the “Indemnified Persons”) against any and all losses, claims, damages, liabilities and

 

18

expenses, joint or several (including reasonable attorneys’ fees) caused by any untrue or
alleged untrue statement of material fact contained in any part of any Registration Statement, any
preliminary or final prospectus used in connection with the Registrable Securities or any Issuer
FWP, or any omission or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein (in the case of a prospectus, in the light of
the circumstances under which they were made) not misleading; provided that RealNetworks
will not be required to indemnify any Indemnified Persons for any losses, claims, damages,
liabilities or expenses resulting from any such untrue statement or omission if such untrue
statement or omission was made in reliance on and in conformity with any information with respect
to any Indemnified Person furnished to RealNetworks in writing by MTVN expressly for use therein.
In connection with an underwritten offering (including any Takedown Offering), RealNetworks will
indemnify each Underwriter, the officers and directors of such Underwriter, and each Person who
controls such Underwriter (within the meaning of either the Securities Act or the Exchange Act) to
the same extent as provided above with respect to the indemnification of MTVN; provided
that such Underwriter agrees to indemnify RealNetworks to the same extent as provided below with
respect to the indemnification of RealNetworks by MTVN.

     (b) In connection with any Registration Statement, preliminary or final prospectus or Issuer
FWP, MTVN agrees to indemnify RealNetworks, the Directors, its officers who sign such Registration
Statement and each Person, if any, who controls RealNetworks (within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act) to the same extent as the
foregoing indemnity from RealNetworks to MTVN, but only with respect to information with respect to
any Indemnified Person furnished to RealNetworks in writing by MTVN expressly for use in such
Registration Statement, preliminary or final prospectus, or Issuer FWP.

     (c) In case any proceeding (including any governmental investigation) will be instituted
involving any Person in respect of which indemnity may be sought pursuant to Section 2.08(a) or
(b), such Person (hereinafter called the “indemnified party”) will promptly notify the
Person against whom such indemnity may be sought (hereinafter called the “indemnifying
party”) in writing and the indemnifying party, upon request of the indemnified party, will
retain counsel reasonably satisfactory to the indemnified party to represent the indemnified party
and will pay the fees and disbursements of such counsel related to such proceeding;
provided that failure to so notify an indemnifying party shall not relieve it from any
liability which it may have hereunder, except to the extent that the indemnifying party is
materially prejudiced by such failure to give notice. In any such proceeding, any indemnified
party will have the right to retain its own counsel, but the fees and expenses of such counsel will
be at the expense of such indemnified party unless (i) the indemnifying party and the indemnified
party will have mutually agreed to the retention of such counsel or (ii) the named parties to any
such proceeding (including any impleaded parties) include both the indemnifying party and the
indemnified party and the indemnified party will have been advised in writing by counsel that
representation of both parties by the same counsel would be inappropriate due to actual or
potential conflicting interests between them. It is understood that the indemnifying party will
not, in connection with any proceeding or

 

19

related proceedings in the same jurisdiction, be liable for the reasonable fees and expenses
of more than one separate firm of attorneys (in addition to any local counsel) at any time for all
such indemnified parties, and that all such reasonable fees and expenses will be reimbursed as they
are incurred. In the case of the retention of any such separate firm for the indemnified parties,
such firm will be designated in writing by the indemnified parties. The indemnifying party will
not be liable for any settlement of any proceeding effected without its written consent, but if
settled with such consent or if there has been a final judgment for the plaintiff, the indemnifying
party agrees to indemnify the indemnified party from and against any loss or liability by reason of
such settlement or judgment. Notwithstanding the foregoing sentence, if at any time an indemnified
party will have requested an indemnifying party to reimburse the indemnified party for reasonable
fees and expenses of counsel as contemplated by the third sentence of this Section 2.08(c), the
indemnifying party agrees that it will be liable for any settlement of any proceeding effected
without its written consent if (i) such settlement is entered into more than 15 days after receipt
by such indemnifying party of the aforesaid request and (ii) such indemnifying party will not have
reimbursed the indemnified party in accordance with such request or reasonably objected in writing,
on the basis of the standards set forth herein, to the propriety of such reimbursement prior to the
date of such settlement. No indemnifying party will, without the prior written consent of the
indemnified party, effect any settlement of any pending or threatened proceeding in respect of
which any indemnified party is or could have been a party and indemnity could have been sought
hereunder by such indemnified party, unless such settlement is of a claim for monetary damages
only, such claim has been settled by the payment of money only and such settlement includes an
unconditional release of such indemnified party from all liability on claims that are the subject
matter of such proceeding.

     (d) If the indemnification provided for in this Section 2.08 from the indemnifying party is
unavailable to an indemnified party hereunder in respect of any losses, claims, damages,
liabilities or expenses referred to in this Section 2.08, then the indemnifying party, in lieu of
indemnifying such indemnified party, will contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages, liabilities or expenses in such
proportion as is appropriate to reflect the relative fault of the indemnifying party and
indemnified party in connection with the actions that resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable considerations. The relative
fault of such indemnifying party and indemnified party will be determined by reference to, among
other things, whether any action in question, including any untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact, has been made by, or
relates to information supplied by, such indemnifying party or indemnified party, and the parties’
relative intent, knowledge, access to information and opportunity to correct or prevent such
action. The amount paid or payable by a party as a result of the losses, claims, damages,
liabilities and expenses referred to above will be deemed to include, subject to the limitations
set forth in Section 2.08(c), any legal or other fees or expenses reasonably incurred by such party
in connection with any investigation or proceeding.

     (e) The parties agree that it would not be just and equitable if contribution pursuant to
Section 2.08(d) were determined by pro rata allocation or by any other

 

20

method of allocation that does not take into account the equitable considerations referred to
in Section 2.08(d). No Person guilty of “fraudulent misrepresentation” (within the meaning
of Section 11(f) of the Securities Act) will be entitled to contribution from any Person who was
not guilty of such fraudulent misrepresentation.

     (f) Notwithstanding the provisions of this Section 2.08, MTVN shall not be required to make
any indemnification or contribution payment, in the aggregate, in any amount in excess of the
amount of the net proceeds received by MTVN with respect to the Registrable Securities.

     (g) If indemnification is available under this Section 2.08, the indemnifying party will
indemnify each indemnified party to the full extent provided in Sections 2.08(a) and (b) without
regard to the relative fault of said indemnifying party or indemnified party or any other equitable
consideration provided for in Section 2.08(d) or (e).

     SECTION 2.09. Rule 144. For so long as RealNetworks is subject to the requirements of
Section 13, 14 or 15(d) of the Securities Act, RealNetworks agrees that it will timely file the
reports required to be filed by it under the Securities Act and the Exchange Act and the rules and
regulations adopted by the SEC thereunder and it will take such further action as MTVN reasonably
may request, all to the extent required from time to time to enable MTVN to sell Registrable
Securities within the limitation of the exemptions provided by (a) Rule 144 under the Securities
Act, as such rule may be amended from time to time, or (b) any similar rule or regulation hereafter
adopted by the SEC. Upon the request of MTVN, RealNetworks will deliver to MTVN a written
statement as to whether it has complied with such requirements.

     SECTION 2.10. Lock-Up. If and to the extent requested by the lead Underwriter of an
underwritten offering of Registrable Securities (including any Takedown Offering), RealNetworks and
MTVN agree not to effect, and to cause their respective Affiliates not to effect, except as part of
such registration, any offer, sale, pledge, transfer or other distribution or disposition or any
agreement with respect to the foregoing, of the issue being registered or offered, as applicable,
or of a similar security of RealNetworks, or any securities into which such Registrable Securities
are convertible, or any securities convertible into, or exchangeable or exercisable for, such
Registrable Securities, including a sale pursuant to Rule 144 under the Securities Act, during a
period of up to seven days prior to, and during a period of up to 120 days after, the effective
date of such registration, or the date of consummation of such Takedown Offering, as applicable, as
reasonably requested by the lead Underwriter; provided that in no event will MTVN be
restricted hereunder for more than 180 days in any 12-month period (including, for purposes hereof,
restrictions under Section 2.01(e)). The lead Underwriter shall give RealNetworks and MTVN prior
notice of any such request.

     SECTION 2.11. Other Registration Rights. RealNetworks has not granted and will not
grant to any third party any registration rights more favorable than or inconsistent with any of
those contained herein, so long as any of the registration rights under this Agreement remain in
effect.

 

21

ARTICLE III

Access to Information

     SECTION 3.01. Access to Information. So long as MTVN’s Outstanding Percentage
Interest is at least 10%, upon reasonable prior written notice (i) RealNetworks shall provide MTVN
with reasonable access to the senior executive team of RealNetworks; provided that such
senior executives shall not be required to provide MTVN with any material non-public information in
any such meeting, (ii) RealNetworks shall furnish MTVN with financial, operating and other data and
information of RealNetworks and its Subsidiaries as MTVN may from time to time reasonably request
in writing consistent with its duty to provide such information to shareholders in general and
(iii) RealNetworks will, and will cause its Subsidiaries and the Representatives of RealNetworks
and its Subsidiaries to, afford MTVN and its Representatives reasonable access, consistent with
applicable Law, to its and its Subsidiaries’ Representatives, and to the books and records of
RealNetworks and its Subsidiaries. Neither RealNetworks nor its Subsidiaries shall be required to
provide access to or to disclose information where such access or disclosure would jeopardize the
attorney-client privilege of RealNetworks or its Subsidiaries or contravene any Law (including
antitrust laws). MTVN agrees, and will cause its Representatives to agree, to keep all such
information confidential, except to the extent required by law or to the extent such information
otherwise is or becomes publicly available. To the extent that MTVN is provided with material
non-public information by any such member of the senior executive team of RealNetworks in any such
meeting referenced in clause (i) above, MTVN acknowledges (A) that MTVN has received a copy of
RealNetworks’ Policy on Avoidance of Insider Trading that is in effect as of the date hereof and
(B) that applicable securities laws restrict trading on the basis of material non-public
information.

ARTICLE IV

Standstill

     SECTION 4.01. Standstill. MTVN covenants and agrees with RealNetworks that, for a
period of three years or for such period as MTVN’s Outstanding Percentage Interest is at least 5%,
whichever is shorter, from the effectiveness of this Agreement, MTVN shall not, and it will cause
its Affiliates not to, directly or indirectly, alone or in concert with others, unless authorized
by the chief executive officer of RealNetworks or by a resolution of a majority of the Directors,

     (a) publicly propose, or participate in a Group with any other Person who has publicly
proposed, any Business Combination;

     (b) acquire, offer or propose to acquire, solicit an offer to sell or agree to acquire, by
purchase or otherwise, any Beneficial Ownership of any voting securities of RealNetworks or rights,
warrants or options to acquire, or securities convertible into or exchangeable for, any voting
securities of RealNetworks, except as contemplated by this Agreement, the LLC Agreement or any
transaction to which RealNetworks is a party;

 

22

     (c) make, or in any way participate in, any “solicitation” of “proxies” to vote (as such
terms are used in the proxy rules of the SEC promulgated pursuant to Section 14 of the Exchange
Act) any voting securities of RealNetworks;

     (d) form, join or any way participate in a “group” within the meaning of Section 13(d)(3) of
the Exchange Act with respect to any voting securities of RealNetworks;

     (e) arrange, or in any way participate, directly or indirectly, in any financing for the
purchase of any voting securities of RealNetworks or any securities convertible into or
exchangeable or exercisable for any voting securities or assets of RealNetworks, except for such
assets as are then being offered for sale by RealNetworks or any of its Affiliates;

     (f) otherwise seek to propose to the RealNetworks or any of its stockholders any Business
Combination or otherwise seek to control or change the management or board of directors of
RealNetworks or nominate any person as a director who is not nominated by the then incumbent
directors, or propose any matter to be voted upon by the stockholders of RealNetworks, except as
contemplated by this Agreement;

     (g) make any request or proposal to amend, waive or terminate any provision of this Section
4.01; or

     (h) take any action that might result in RealNetworks having to make a public announcement
regarding any of the matters referred to in clauses (a) through (g) of this Section 4.01, or
announce an intention to do, or enter into any arrangement or understanding or discussions with
others to do, any of the actions restricted or prohibited under such clauses (a) through (g) of
this Section 4.01.

     SECTION 4.02. Exceptions to Standstill. MTVN shall not be subject to any of the
restrictions set forth in Section 4.01 if (a) the Board determines to solicit bids for the
acquisition of RealNetworks, (b) the Board shall have recommended in favor of or shall have entered
into a definitive agreement providing for any Business Combination except that references to 20% of
any class of Equity Securities of RealNetworks or any resulting parent company of RealNetworks in
the definition thereof shall be changed to the greater of (A) 35% of the Voting Stock of
RealNetworks or any resulting parent company of RealNetworks and (B) one share more than the number
of shares of Voting Stock of RealNetworks or any resulting parent company of RealNetworks then
Beneficially Owned by Robert Glaser, for purposes hereof, (c) any Person or Group (other than MTVN
or any Group that includes MTVN), at any point in time, acquires, has acquired or otherwise has
Beneficial Ownership of the greater of (A) 35% of the Voting Stock of RealNetworks or any resulting
parent company of RealNetworks and (B) one share more than the number of shares of Voting Stock of
RealNetworks or any resulting parent company of RealNetworks then Beneficially Owned by Robert
Glaser or (d) any Person (other than MTVN or its Affiliates) commences a “going private”
transaction subject to Rule 13e-3 under Section 13(e) of the Exchange Act involving RealNetworks.

 

23

For purposes of this Article IV, neither RealNetworks nor Robert Glaser shall be deemed to be
an Affiliate of MTVN or part of a Group with MTVN or any of its Affiliates.

     SECTION 4.03. Fiduciary Duties. Notwithstanding anything herein to the contrary,
nothing in this Article IV shall in any way restrict a designee of MTVN, should such a designee
ever ascend to the Board, in his or her capacity as a Director or Board committee member from
complying with his or her fiduciary duties in such capacity (including voting as a Director or
Board committee member) as he or she may determine.

ARTICLE V

Transfer Restrictions

     SECTION 5.01. Restrictions on Transfer. Without the consent of RealNetworks, MTVN
agrees that (i) in any 10 consecutive Trading Day period it shall not Transfer an amount of Common
Stock and/or Non-Voting Equity in excess of one percent of the aggregate number of shares of Common
Stock and Non-Voting Equity outstanding on the first day of such 10 consecutive Trading Day period
and (ii) in any three-month period it shall not Transfer an amount of Common Stock and/or
Non-Voting Equity in excess of the greater of (x) one percent of the aggregate number of shares of
Common Stock and Non-Voting Equity outstanding on the first day of such three-month period and (y)
the average weekly trading volume of the Common Stock during the four weeks preceding the first day
of such three-month period; provided that the foregoing shall not apply to any Transfer:

     (a) to RealNetworks or any of its Affiliates;

     (b) to any Permitted Transferee, so long as such Permitted Transferee agrees to be
bound by the terms of this Agreement (if not already bound hereby);

     (c) in connection with an underwritten offering pursuant to the registration rights
provisions of Article II;

     (d) pursuant to a bona fide third party tender offer or exchange offer; or

     (e) arising as a result of a merger, consolidation, binding share exchange or similar
transaction involving RealNetworks.

ARTICLE VI

Miscellaneous

     SECTION 6.01. Effectiveness and Termination. (a) This Agreement will become
effective upon the closing of a put/call pursuant to Section 10.03 of the LLC Agreement in which
Common Stock or Non-Voting Equity is issued or delivered to MTVN or its Affiliates.

 

24

     (b) This Agreement shall terminate at such time as MTVN’s Outstanding Percentage Interest is
less than 5%.

     SECTION 6.02. Interpretation. When a reference is made in this Agreement to an
Article, a Section, a Subsection or a Schedule, such reference will be to an Article, a Section, a
Subsection or a Schedule of this Agreement unless otherwise indicated. The headings contained in
this Agreement are for reference purposes only and will not affect in any way the meaning or
interpretation of this Agreement. Whenever the words “include”, “includes” or “including” are used
in this Agreement, they will be deemed to be followed by the words “without limitation”. The words
“hereof”, “herein” and “hereunder” and words of similar import when used in this Agreement will
refer to this Agreement as a whole and not to any particular provision of this Agreement. The
words “date hereof” will refer to the date of this Agreement. The term “or” is not exclusive. The
word “extent” in the phrase “to the extent” will mean the degree to which a subject or other thing
extends, and such phrase will not mean simply “if”. The definitions contained in this Agreement
are applicable to the singular as well as the plural forms of such terms. Any agreement or
instrument defined or referred to herein or in any agreement or instrument that is referred to
herein means such agreement or instrument as from time to time amended, modified or supplemented.
References to a Person are also to its permitted successors and assigns.

     SECTION 6.03. Adjustments. References to numbers of shares and to sums of money
contained herein will be adjusted to account for any reclassification, exchange, substitution,
combination, stock split or reverse stock split of the shares.

     SECTION 6.04. Commercially Reasonable Efforts; Further Actions. The parties hereto
each will use all commercially reasonable efforts to take or cause to be taken all action and to do
or cause to be done all things necessary, proper or advisable under applicable Laws and regulations
to consummate and make effective the transactions contemplated by this Agreement as promptly as
practicable.

     SECTION 6.05. Consents. The parties hereto will cooperate with each other in filing
any necessary applications, reports or other documents with, giving any notices to, and seeking any
consents from, all regulatory bodies, Governmental Entities and all third parties as may be
required in connection with the consummation of the transactions contemplated by this Agreement.

     SECTION 6.06. Notices. Except as otherwise expressly provided in this Agreement, all
notices, requests and other communications to any party hereunder shall be in writing (including a
facsimile or similar writing) and shall be given to such party at the address or facsimile number
set forth for such party below or as such party shall hereafter specify for the purpose by notice
to the other parties. Each such notice, request or other communication shall be effective (i) if
given by facsimile, at the time such facsimile is transmitted and the appropriate confirmation is
received (or, if such time is not during a Business Day, at the beginning of the next such Business
Day), (ii) if given by mail, five Business Days (or, (x) if by overnight courier, one Business Day,
or (y) if to an address outside the United States, seven Business Days) after such communication is

 

25

deposited in the mails with first-class postage prepaid, addressed as aforesaid, or (iii) if
given by any other means, when delivered at the address specified pursuant to this Section 6.06.

     (a) if to RealNetworks:

2601 Elliott Avenue

Suite 1000

Seattle, WA 98121

Phone: 206-674-2700

Attention: Robert Kimball, Senior Vice President, Legal and 
Business
Affairs, and General Counsel

     with copies to:

Weil, Gotshal & Manges LLP

767 Fifth Avenue

New York, NY 10153

Fax: 212-310-8677

Phone: 212-310-8362

Email: ted.waksman@weil.com

Attention: Ted S. Waksman, Esq.

RealNetworks, Inc.

519 Eighth Avenue

New York, New York 10018

Fax: 212 391-9566

Phone: 212 710-0211

Email: dnemo@real.com

Attention: Dan Nemo, Vice President

     (b) if to MTVN:

1515 Broadway

New York, NY 10036

Fax: 212-258-6099

Phone: 212-258-6070

Email: michael.fricklas@viacom.com

Attention: Michael D. Fricklas, Esq.

 

26

     with a copy to:

Cravath, Swaine & Moore LLP

825 Eighth Avenue

New York, NY 10019

Fax: 212-474-3700

Phone: 212-474-1000

Email: fsaeed@cravath.com

Attention: Faiza J. Saeed, Esq.

     SECTION 6.07. No Third Party Beneficiaries. This Agreement shall be binding upon and
inure to the benefit of all the parties hereto and their successors and assigns, and their legal
representatives. No party may assign this Agreement or any of its rights, interests or
obligations. Except for the provisions of Article II, this Agreement is not intended to confer any
rights or remedies hereunder upon, and shall not be enforceable by, any Person other than the
parties hereto.

     SECTION 6.08. Waiver. No failure by any party to insist upon the strict performance
of any covenant, agreement, term or condition of this Agreement or to exercise any right or remedy
consequent upon a breach of such or any other covenant, agreement, term or condition shall operate
as a waiver of such or any other covenant, agreement, term or condition of this Agreement. Any
party by notice given in accordance with Section 6.06 may, but shall not be under any obligation
to, waive any of its rights or conditions to its obligations hereunder, or any duty, obligation or
covenant of any other party. No waiver shall affect or alter the remainder of this Agreement but
each and every covenant, agreement, term and condition hereof shall continue in full force and
effect with respect to any other then existing or subsequent breach. The rights and remedies
provided by this Agreement are cumulative and the exercise of any one right or remedy by any party
shall not preclude or waive its right to exercise any or all other rights or remedies.

     SECTION 6.09. Integration. This Agreement and the Transaction Documents (as defined
in the Transaction, Contribution and Purchase Agreement dated as of August 20, 2007, among MTVN
Parent, DMS Holdco Inc., RealNetworks, RealNetworks Digital Music of California, Inc. and Rhapsody
America LLC) and all other written agreements contemporaneously entered into herewith by the
parties constitute the entire agreement among the parties hereto pertaining to the subject matter
hereof and supersede all prior agreements and understandings of the parties in connection herewith,
and no covenant, representation or condition not expressed in this Agreement shall affect, or be
effective to interpret, change or restrict, the express provisions of this Agreement.

     SECTION 6.10. Headings. The titles of Articles and Sections of this Agreement are for
convenience only and shall not be interpreted to limit or amplify the provisions of this Agreement.

 

27

     SECTION 6.11. Counterparts. This Agreement may be executed in multiple counterparts,
each of which shall be deemed an original and all of which, taken together, shall constitute one
and the same instrument and shall become effective when one or more counterparts have been signed
by each of the parties and delivered to the other parties.

     SECTION 6.12. Severability. Each provision of this Agreement shall be considered
separable and if for any reason any provision or provisions hereof are determined to be invalid and
contrary to any existing or future Law, such invalidity shall not impair the operation of or affect
those portions of this Agreement which are valid; provided, however, that in such
case the parties hereto shall endeavor to amend or modify this Agreement to achieve to the extent
reasonably practicable the purpose of the invalid provision.

     SECTION 6.13. Amendments and Modifications. This Agreement may be amended or modified
at any time and from time to time with the written consent of each party hereto.

     SECTION 6.14. Applicable Law. This Agreement shall be governed by and construed in
accordance with the Laws of the State of New York without giving effect to the conflicts of law
principles thereof.

     SECTION 6.15. Dispute Resolution. Any and all disputes arising out of or relating to
any aspect of this Agreement shall be resolved pursuant to the provisions set forth in Schedule I.

     SECTION 6.16. Waiver of Jury Trial. Each of the parties to this Agreement irrevocably
waives any and all right to trial by jury in any legal proceeding arising out of or relating to
this Agreement or the transactions contemplated by this Agreement.

     SECTION 6.17. Absence of Presumption. The parties hereto have participated jointly in
the negotiation and drafting of this Agreement and, in the event of ambiguity or question of intent
or interpretation arises, this Agreement shall be construed as if drafted jointed by such parties
and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of
the authorship of any of the provisions of this Agreement.

     SECTION 6.18. Expenses. Except as otherwise provided in Article II, each of MTVN and
RealNetworks shall be responsible for its own expenses incurred in connection with this Agreement.

     SECTION 6.19. Articles of Incorporation and By-Laws. RealNetworks shall take or cause
to be taken all lawful action necessary to ensure at all times that the Articles of Incorporation,
By-Laws and corporate governance policies and guidelines of RealNetworks are not at any time
inconsistent in any material respect with the provisions of this Agreement.

 

28

     SECTION 6.20. Change in Law. In the event any Law comes into force or effect
(including by amendment) which conflicts with the terms and conditions of this Agreement, the
parties will negotiate in good faith to revise this Agreement to achieve the parties’ intention set
forth herein to the greatest extent possible.

 

29

     IN WITNESS WHEREOF, the parties hereto have executed this Stockholder Agreement as of the day
and year first above written.

	 	 	 	 	 
	 

	VIACOM INTERNATIONAL INC.,
	 
	 	 	 	 
	 

	 	by
	 	/s/ MICHAEL D. FRICKLAS
	 

	 	 	 	 
	 

	 	 	 	Name: Michael D. Fricklas
	 

	 	 	 	Title: Executive Vice President,
	 

	 	 	 	          General Counsel and Secretary

 

30

	 	 	 	 	 
	 

	REALNETWORKS, INC.
	 
	 	 	 	 
	  

	 	by
	 	/s/ ROBERT GLASER
	 

	 	 	 	 
	 

	 	 	 	Name: Robert Glaser
	 

	 	 	 	Title: Chief Executive Officer

 

 

SCHEDULE I

DISPUTE RESOLUTION

Article I

Dispute Resolution. (a) Any and all disputes arising out of or relating to any provision
of this Agreement, except as set forth in paragraph (g), shall be resolved exclusively pursuant to
arbitration conducted in Seattle, Washington and administered by JAMS or any successor entity
thereto (“JAMS”), in accordance with its Comprehensive Rules and Procedures (“JAMS Rules”) as
modified by the provisions herein. The arbitration shall be conducted by a panel of three (3)
arbitrators (the “panel”). Each party shall select one arbitrator (a “party arbitrator”) and the
two party arbitrators shall select a third arbitrator, who will be the Chairperson. The persons
considered for selection as arbitrators hereunder shall not be limited to persons identified by
JAMS. All three arbitrators shall be neutral and independent of the appointing party. There shall
be no ex parte communications with the party arbitrators after the first organizational meeting.
The confidentiality of all proceedings related to any arbitration shall be strictly maintained, as
shall the confidentiality of any documents, deposition testimony, or other information exchanged in
relation to the arbitration proceedings (except as information may be required in any judicial
proceeding brought to enforce these arbitration provisions or any award rendered hereunder).

(b) Without limiting the generality of paragraph (a), it is understood that this Article does not
apply to any disputes concerning intellectual property rights, other than to disputes arising out
of any express grant or license of any intellectual property rights owned or controlled by any of
the parties to this Agreement and made or allegedly made to one another or to the Company pursuant
to any of the transaction documents entered into in connection with the creation of the Company,
including but not limited to disputes relating to the scope, nature or duration of such grant or
license, whether there has been a grant or license of certain intellectual property rights, and/or
the applicable terms, conditions, limitations, representations and warranties and indemnities
relating to or arising from any such grant or license, all of which disputes, for the avoidance of
doubt, shall be subject to arbitration pursuant to the terms hereof.

(c) Prior to commencing arbitration, a party shall deliver notice of the applicable dispute to the
other parties and the parties shall meet and discuss possible resolution of such dispute. Within
thirty (30) days of delivery of notice of a dispute, senior executives of the MTVN Music Group (as
defined in the LLC Agreement) and RealNetworks shall meet and attempt to negotiate a resolution.
After notice and the expiration of such thirty (30) day period either party may commence
arbitration.

(d) The panel shall be requested to use reasonable efforts to render its decision and award within
six (6) months of the first organizational meeting. The panel shall allow reasonable discovery,
relevant to the issues before it, subject to the goal of completing the proceedings within the
specified time frame. Except with respect to custodial depositions, depositions shall be limited
to a maximum total number of fifty hours for each party, except in extraordinary cases. The
decision of the panel shall be final.

 

 

(e) The panel shall render findings of fact and conclusions of law and a written opinion setting
forth the basis and reasons for any decision reached. In rendering an award, the panel shall
determine the rights and obligations of the parties according to the substantive laws of the State
of Delaware and of the United States.

(f) The panel shall have the authority to grant any equitable or legal relief that would be
available in any judicial proceeding instituted to resolve the disputed matter, including interim
relief, but the panel shall not have the authority to grant any remedies the parties have waived in
the Agreement or to award punitive or exemplary damages. The panel shall have the authority to
award costs, including reasonable attorneys fees, of any arbitration.

(g) Each of the parties agrees that it will not bring any action relating to the interpretation,
application or enforcement of the provisions of this Article or seeking emergency or temporary
relief prior to appointment of the panel in any court other than a Federal or state court sitting
in the State of Delaware, and the laws of the State of Delaware shall apply to any such action.
With respect to any such action, each of the parties hereby consents to and submits itself and its
property to the personal jurisdiction of any Federal or state court located in the State of
Delaware. Each of the parties hereby waives any rights such party may have to personal service of
a summons, complaint or other process in connection with such an action and agrees that service may
be made by registered or certified mail addressed to such party and sent in accordance with the
provisions of this Agreement. The parties acknowledge and agree that upon appointment of the
panel, it shall have the exclusive authority to grant relief.

(h) The parties hereby also consent to the personal jurisdiction of any Federal or state court in
the County of New York or in Seattle, Washington, for the purpose of confirming any award and
entering judgment thereon. The parties hereby waive any and all objections that they may have as
to jurisdiction or venue in any of such courts.exv10w1

 

Exhibit 10.1

[Execution
Copy]

 

 

[Published CUSIP Number:                     ]

CREDIT AGREEMENT

Dated as of October 29, 2007

among

PIONEER SOUTHWEST ENERGY PARTNERS L.P.,

as the Borrower,

BANK OF AMERICA, N.A.,

as Administrative Agent, Swing Line Lender

and

L/C Issuer,

WELLS FARGO BANK, N. A.,

as Syndication Agent,

BMO CAPITAL MARKETS FINANCING, INC.,

as Documentation Agent

and

The Other Lenders Party Hereto

BANC OF AMERICA SECURITIES LLC and WELLS FARGO BANK, N. A.,

as

Co-Arrangers and Joint Bookrunners

 

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 
	Section	 	 	 	Page
	ARTICLE I. DEFINITIONS AND ACCOUNTING TERMS	 	 	1	 
	1.01

	 	Defined Terms
	 	 	1	 
	1.02

	 	Other Interpretive Provisions
	 	 	26	 
	1.03

	 	Accounting Terms
	 	 	27	 
	1.04

	 	Rounding
	 	 	28	 
	1.05

	 	Times of Day
	 	 	28	 
	1.06

	 	Letter of Credit Amounts
	 	 	28	 
	ARTICLE II. THE COMMITMENTS AND CREDIT EXTENSIONS	 	 	28	 
	2.01

	 	Committed Loans
	 	 	28	 
	2.02

	 	Borrowings, Conversions and Continuations of Committed Loans
	 	 	28	 
	2.03

	 	Letters of Credit
	 	 	30	 
	2.04

	 	Swing Line Loans
	 	 	38	 
	2.05

	 	Prepayments
	 	 	41	 
	2.06

	 	Termination or Reduction of Commitments
	 	 	42	 
	2.07

	 	Repayment of Loans
	 	 	42	 
	2.08

	 	Interest
	 	 	42	 
	2.09

	 	Fees
	 	 	43	 
	2.10

	 	Computation of Interest and Fees; Retroactive Adjustments of Applicable Rate	 	 	44	 
	2.11

	 	Evidence of Debt
	 	 	44	 
	2.12

	 	Payments Generally; Administrative Agent’s Clawback
	 	 	45	 
	2.13

	 	Sharing of Payments by Lenders
	 	 	47	 
	2.14

	 	Extension of Maturity Date
	 	 	47	 
	2.15

	 	Increase in Commitments
	 	 	49	 
	ARTICLE III. TAXES, YIELD PROTECTION AND ILLEGALITY	 	 	51	 
	3.01

	 	Taxes
	 	 	51	 
	3.02

	 	Illegality
	 	 	52	 
	3.03

	 	Inability to Determine Rates
	 	 	53	 
	3.04

	 	Increased Costs; Reserves on Eurodollar Rate Loans
	 	 	53	 
	3.05

	 	Compensation for Losses
	 	 	55	 
	3.06

	 	Mitigation Obligations; Replacement of Lenders
	 	 	56	 

-i-

 

TABLE OF CONTENTS

(continued)

	 	 	 	 	 	 	 
	Section	 	 	 	Page
	3.07

	 	Survival
	 	 	56	 
	ARTICLE IV. CONDITIONS PRECEDENT TO CREDIT EXTENSIONS	 	 	56	 
	4.01

	 	Conditions of Initial Credit Extension
	 	 	56	 
	4.02

	 	Conditions to all Credit Extensions
	 	 	58	 
	ARTICLE V. REPRESENTATIONS AND WARRANTIES	 	 	58	 
	5.01

	 	Organization; Powers
	 	 	58	 
	5.02

	 	Authorization; Enforceability
	 	 	59	 
	5.03

	 	Governmental Approvals; No Conflicts
	 	 	59	 
	5.04

	 	Financial Statements; No Material Adverse Effect
	 	 	59	 
	5.05

	 	Properties
	 	 	60	 
	5.06

	 	Litigation and Environmental Matters
	 	 	60	 
	5.07

	 	Compliance with Laws; No Default
	 	 	60	 
	5.08

	 	Investment Company Status
	 	 	60	 
	5.09

	 	Taxes
	 	 	60	 
	5.10

	 	ERISA
	 	 	61	 
	5.11

	 	Disclosure
	 	 	61	 
	5.12

	 	Subsidiaries; Equity Interests
	 	 	61	 
	5.13

	 	Insurance
	 	 	61	 
	5.14

	 	Gas Imbalances, Prepayments
	 	 	62	 
	5.15

	 	Marketing of Production
	 	 	62	 
	5.16

	 	Swap Contracts
	 	 	62	 
	5.17

	 	Solvency
	 	 	62	 
	5.18

	 	Taxpayer Identification Number
	 	 	62	 
	ARTICLE VI. AFFIRMATIVE COVENANTS	 	 	63	 
	6.01

	 	Financial Statements
	 	 	63	 
	6.02

	 	Certificates; Other Information
	 	 	63	 
	6.03

	 	Notices of Material Events
	 	 	65	 
	6.04

	 	Existence; Conduct of Business
	 	 	66	 
	6.05

	 	Payment of Obligations
	 	 	66	 
	6.06

	 	Maintenance of Properties; Insurance
	 	 	66	 

-ii-

 

TABLE OF CONTENTS

(continued)

	 	 	 	 	 	 	 
	Section	 	 	 	Page
	6.07

	 	Books and Records; Inspection Rights
	 	 	67	 
	6.08

	 	Compliance with Laws
	 	 	67	 
	6.09

	 	Use of Proceeds
	 	 	67	 
	6.10

	 	Operations
	 	 	67	 
	6.11

	 	Minimum Hedging
	 	 	67	 
	6.12

	 	Additional Guarantors; Designation of Unrestricted Subsidiaries
	 	 	68	 
	ARTICLE VII. NEGATIVE COVENANTS	 	 	68	 
	7.01

	 	Indebtedness
	 	 	68	 
	7.02

	 	Liens
	 	 	69	 
	7.03

	 	Fundamental Changes
	 	 	70	 
	7.04

	 	Financial Covenants
	 	 	70	 
	7.05

	 	Investments, Loans, Advances and Guarantees
	 	 	71	 
	7.06

	 	Swap Contracts
	 	 	71	 
	7.07

	 	Transactions with Affiliates
	 	 	72	 
	7.08

	 	Restrictive Agreements
	 	 	72	 
	7.09

	 	Restricted Payments
	 	 	72	 
	7.10

	 	Negative Pledge
	 	 	73	 
	7.11

	 	Tax Status as Partnership; Organizational and Material Contracts
	 	 	73	 
	ARTICLE VIII. EVENTS OF DEFAULT AND REMEDIES	 	 	73	 
	8.01

	 	Events of Default
	 	 	73	 
	8.02

	 	Remedies Upon Event of Default
	 	 	76	 
	ARTICLE IX. ADMINISTRATIVE AGENT	 	 	77	 
	9.01

	 	Appointment and Authority
	 	 	77	 
	9.02

	 	Rights as a Lender
	 	 	77	 
	9.03

	 	Exculpatory Provisions
	 	 	77	 
	9.04

	 	Reliance by Administrative Agent
	 	 	78	 
	9.05

	 	Delegation of Duties
	 	 	78	 
	9.06

	 	Resignation of Administrative Agent
	 	 	78	 
	9.07

	 	Non-Reliance on Administrative Agent and Other Lenders
	 	 	79	 
	9.08

	 	No Other Duties, Etc.
	 	 	79	 

-iii-

 

TABLE OF CONTENTS

(continued)

	 	 	 	 	 	 	 
	Section	 	 	 	Page
	9.09

	 	Administrative Agent May File Proofs of Claim
	 	 	79	 
	9.10

	 	Guaranty Matters
	 	 	80	 
	ARTICLE X. MISCELLANEOUS	 	 	80	 
	10.01

	 	Amendments, Etc.
	 	 	80	 
	10.02

	 	Notices; Effectiveness; Electronic Communication
	 	 	81	 
	10.03

	 	No Waiver; Cumulative Remedies
	 	 	84	 
	10.04

	 	Expenses; Indemnity; Damage Waiver
	 	 	84	 
	10.05

	 	Payments Set Aside
	 	 	86	 
	10.06

	 	Successors and Assigns
	 	 	86	 
	10.07

	 	Treatment of Certain Information; Confidentiality
	 	 	90	 
	10.08

	 	Right of Setoff
	 	 	91	 
	10.09

	 	Interest Rate Limitation
	 	 	91	 
	10.10

	 	Counterparts; Integration; Effectiveness
	 	 	92	 
	10.11

	 	Survival of Representations and Warranties
	 	 	92	 
	10.12

	 	Severability
	 	 	92	 
	10.13

	 	Replacement of Lenders
	 	 	92	 
	10.14

	 	Governing Law; Jurisdiction; Etc.
	 	 	93	 
	10.15

	 	Waiver of Jury Trial
	 	 	94	 
	10.16

	 	No Advisory or Fiduciary Responsibility
	 	 	94	 
	10.17

	 	USA PATRIOT Act Notice
	 	 	95	 
	10.18

	 	No Liability of General Partner
	 	 	95	 
	10.19

	 	Swap Contracts and Guaranty
	 	 	95	 
	10.20

	 	ENTIRE AGREEMENT
	 	 	96	 

-iv-

 

 

	 	 	 	 	 	 	 
	SCHEDULES	 	 
	 

	 	 	2.01	 	 	Commitments and Applicable Percentages
	 

	 	 	5.06	 	 	Disclosure Matters
	 

	 	 	5.12	 	 	Subsidiaries; Other Equity Investments
	 

	 	 	5.14	 	 	Gas Imbalances; Prepayments
	 

	 	 	5.15	 	 	Marketing Agreements
	 

	 	 	5.16	 	 	Swap Contracts
	 

	 	 	7.02	 	 	Existing Liens
	 

	 	 	7.08	 	 	Existing Restrictive Agreements
	 

	 	 	10.02	 	 	Administrative Agent’s Office; Certain Addresses for Notices

EXHIBITS

	 	 	 	 	 	 	 
	 

	 	 	 	Form of
 	 	 
	 

	 	A
	 	Committed Loan Notice
	 	 
	 

	 	B
	 	Swing Line Loan Notice	 	 
	 

	 	C
	 	Note	 	 
	 

	 	D
	 	Compliance Certificate	 	 
	 

	 	E
	 	Assignment and Assumption	 	 
	 

	 	F
	 	Guaranty	 	 
	 

	 	G
	 	Opinion Matters	 	 
	 

	 	H
	 	General Partner Certificate	 	 

-v-

 

 

CREDIT AGREEMENT

     This CREDIT AGREEMENT (“Agreement”) is entered into as of October 29, 2007, among
PIONEER SOUTHWEST ENERGY PARTNERS L.P., a Delaware limited partnership (the “Borrower”),
each lender from time to time party hereto (collectively, the “Lenders” and individually, a
“Lender”), BANK OF AMERICA, N.A., as Administrative Agent, Swing Line Lender and L/C
Issuer, WELLS FARGO BANK, N. A., as Syndication Agent, and BMO CAPITAL MARKETS FINANCING, INC., as
Documentation Agent.

RECITALS

     WHEREAS, the Borrower has requested that the Lenders provide commitments pursuant to which
loans made be made to Borrower by the Lenders and letters of credit may be issued on behalf of the
Borrower;

     WHEREAS, the Lenders are and L/C Issuer are willing, on the terms and conditions set forth
herein (including Article IV), to extend such commitments and make such loans and issue such
letters of credit; and

     WHEREAS, the proceeds of loans hereunder will be used to consummate the Closing Transactions
(as hereinafter defined) and for the general purposes of the Borrower and its Restricted
Subsidiaries (as hereinafter defined).

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

ARTICLE I.

DEFINITIONS AND ACCOUNTING TERMS

     1.01 Defined Terms. As used in this Agreement, the following terms shall have the meanings
set forth below:

     “Acquisition” means the direct or indirect purchase or acquisition, whether in one or
more related transactions, of (a) any Person or group of Persons, or (b) any assets or securities
of any Person or group of Persons; provided, however, that notwithstanding the foregoing, the term
“Acquisition” shall be deemed not to include purchase and acquisitions by a Person of property made
in the ordinary course of business.

     “Acquisition Period” means a period elected by the Borrower, with such election
exercised by the Borrower delivering notice thereof to the Administrative Agent, that commences
with the funding date of the purchase price for any Specified Acquisition and ending on the earlier
of (a) the last day of the fourth consecutive fiscal quarter, inclusive of the fiscal quarter in
which the funding date occurred, thereafter or (b) the Borrower’s election (provided that the
Borrower is in compliance with all applicable provisions of Section 7.04(c) after giving
effect to such election), to terminate such election, with such election to terminate exercised by
the Borrower delivering a notice thereof to the Administrative Agent; provided that (i) once any

-1-

 

Acquisition Period is in effect, the next Acquisition Period may not commence until the
termination of such current Acquisition Period then in effect, and (ii) after giving effect to the
termination of such Acquisition Period then in effect, the Borrower shall be in compliance with the
applicable provisions of Section 7.04(c) and no Default shall have occurred and be
continuing. For the avoidance of doubt and by way of example, the Acquisition Period for a
Specified Acquisition which has a funding date occurring on March 1, 2008 would end on the earlier
of (1) December 31, 2008 or (2) the Borrower’s election to terminate such election (assuming
Borrower’s compliance with the foregoing clause (b)).

     “Administrative Agent” means Bank of America in its capacity as administrative agent
under any of the Loan Documents, or any successor administrative agent.

     “Administrative Agent’s Fee Letter” means the letter agreement, dated October 4, 2007
between the Borrower and the Administrative Agent.

     “Administrative Agent’s Office” means the Administrative Agent’s address and, as
appropriate, account as set forth on Schedule 10.02, or such other address or account as
the Administrative Agent may from time to time notify to the Borrower and the Lenders.

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

     “Affiliate” means, with respect to any Person, another Person that directly, or
indirectly through one or more intermediaries, Controls or is Controlled by or is under common
Control with the Person specified.

     “Aggregate Commitments” means the Commitments of all the Lenders. The initial
Aggregate Commitments is $300,000,000.

     “Agreement” means this Credit Agreement, as the same may be amended, modified,
restated, or replaced from time to time.

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

     “Applicable Rate” means the following percentages per annum, based upon the
Consolidated Leverage Ratio as set forth in the most recent Compliance Certificate received by the
Administrative Agent pursuant to Section 6.02(b):

-2-

 

Applicable Rate

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	Eurodollar	 	 
	 	 	 	 	 	 	 	 	 	 	Rate	 	 
	Pricing	 	Consolidated	 	 	 	 	 	Letters	 	 
	Level	 	Leverage Ratio	 	Commitment Fee	 	of Credit	 	Base Rate
	1
	 	 	> 3.00:1	 	 	 	0.300	%	 	 	1.500	%	 	 	0.500	%
	2
	 	> 2.00:1 but < 3.00:1	 	 	0.200	%	 	 	1.000	%	 	 	0.000	%
	3
	 	 	< 2.00:1	 	 	 	0.175	%	 	 	0.875	%	 	 	0.000	%

     Any increase or decrease in the Applicable Rate resulting from a change in the Consolidated
Leverage Ratio shall become effective as of the first Business Day immediately following the date a
Compliance Certificate is delivered pursuant to Section 6.02(b); provided,
however, that if a Compliance Certificate is not delivered when due in accordance with such
Section, then Pricing Level 1 shall apply as of the first Business Day after the date on which such
Compliance Certificate was required to have been delivered. The Applicable Rate in effect from the
Closing Date through the first Business Day immediately following the date a Compliance Certificate
is delivered pursuant to Section 6.02(b) for the fiscal quarter ending December 31, 2007
shall be determined based upon the certified calculation of the Consolidated Leverage Ratio
delivered by the Borrower in accordance with Section 4.01(a)(x); provided,
however, that if a Compliance Certificate is not delivered when due in accordance with such
Section, then Pricing Level 1 shall apply as of the first Business Day after the date on which such
Compliance Certificate was required to have been delivered.

     Notwithstanding anything to the contrary contained in this definition, the determination of
the Applicable Rate for any period shall be subject to the provisions of Section 2.10(b).

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

     “Arrangers’ Fee Letter” means the letter agreement, dated October 4, 2007 among the
Borrower, the Administrative Agent, the Syndication Agent and the Co-Arrangers.

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

     “Assignment and Assumption” means an assignment and assumption entered into by a
Lender and an assignee (with the consent of any party whose consent is required by Section
10.06(b)), and accepted by the Administrative Agent, in substantially the form of Exhibit
E or any other form approved by the Administrative Agent.

     “Audited Financial Statements” means the audited Consolidated balance sheet of the
predecessor to the Borrower and its Consolidated Subsidiaries as of December 31, 2006, and the
related Consolidated statements of income or operations, owner’s net equity and cash flows for

-3-

 

such fiscal year of the predecessor of the Borrower and its Consolidated Subsidiaries,
including the notes thereto, as reflected in the Registration Statement.

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

     “Bank of America” means Bank of America, N.A. and its successors.

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

     “Base Rate Committed Loan” means a Committed Loan that is a Base Rate Loan.

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

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

     “Borrower Materials” has the meaning specified in Section 6.02.

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

     “Business Day” means any day other than a Saturday, Sunday or other day on which
commercial banks are authorized to close under the Laws of, or are in fact closed in, the state
where the Administrative Agent’s Office is located and, if such day relates to any Eurodollar Rate
Loan, means any such day on which dealings in Dollar deposits are conducted by and between banks in
the London interbank eurodollar market.

     “Capital Lease Obligations” of any Person means the obligations of such Person to pay
rent or other amounts under any lease of (or other arrangement conveying the right to use) real or
personal property, or a combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under GAAP, and the amount of
such obligations shall be the capitalized amount thereof determined in accordance with GAAP.

     “Cash Collateralize” has the meaning specified in Section 2.03(g).

     “Change in Law” means the occurrence, after the date of this Agreement, of any of the
following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change

-4-

 

in any law, rule, regulation or treaty or in the administration, interpretation or application
thereof by any Governmental Authority or (c) the making or issuance of any request, guideline or
directive (whether or not having the force of law) by any Governmental Authority.

     “Change of Control” means:

     (a) the limited partners of the Borrower approve, in one transaction or a series of
transactions, a plan of complete liquidation or dissolution of the Borrower;

     (b) the sale or other Disposition by either the General Partner or the Borrower of all or
substantially all of its assets in one or more transactions to any Person;

     (c) a transaction or event, or series of transactions or events, shall occur that results in
either (i) Pioneer or an Affiliate of Pioneer ceasing to own, directly or indirectly, all of the
general partnership Equity Interests issued by the Borrower or (ii) Pioneer and its Affiliates
ceasing to have the power to cause the appointment of a majority of the members of the Board of
Directors or equivalent governing body of each general partner of the Borrower;

     (d) on and after the Closing Date, the failure of the Borrower and/or a wholly-owned
Restricted Subsidiary to own 100% of the Equity Interests of the Operating Company; or

     (e) a “Change in Control” as defined in the Pioneer Credit Agreement shall occur and not be
waived by the lenders thereunder unless the Person so acquiring Pioneer or the successor or
surviving entity to Pioneer, as applicable, has a senior long-term unsecured debt obligations
rating of at least Baa3 issued by Moody’s and BBB- issued by S&P, in each case, with a stable
outlook.

     “Closing Date” means the first date all the conditions precedent in Section
4.01 are satisfied or waived in accordance with Section 10.01.

     “Closing Transactions” means (a) the transactions to occur on or prior to the Closing
Date pursuant to the Contribution Agreement, Partnership Agreement, Omnibus Agreement, LLC Interest
Sale Agreement, and Formation Merger Agreement and (b) the consummation of the Equity Offering.

     “Closing Transactions Documents” means (a) the Contribution Agreement, Partnership
Agreement, Omnibus Agreement, LLC Interest Sale Agreement, Formation Merger Agreement, and (b) each
of the following agreements, as defined in the Partnership Agreement: the Services Agreement,
Omnibus Operating Agreement, the Operating Agreements, Tax Sharing Agreement and, if applicable,
the Purchase Agreement.

     “Co-Arrangers” means Banc of America Securities LLC and Wells Fargo Bank, N.A., each
acting in its capacity as co-arranger and joint bookrunner.

     “Code” means the Internal Revenue Code of 1986.

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

-5-

 

purchase participations in Swing Line Loans, in an aggregate principal amount at any one time
outstanding not to exceed the amount set forth opposite such Lender’s name on Schedule 2.01
or in the Assignment and Assumption pursuant to which such Lender becomes a party hereto, as
applicable, as such amount may be adjusted from time to time in accordance with this Agreement.

     “Committed Borrowing” means a borrowing consisting of simultaneous Committed Loans of
the same Type and, in the case of Eurodollar Rate Loans, having the same Interest Period made by
each of the Lenders pursuant to Section 2.01.

     “Committed Loan” has the meaning specified in Section 2.01.

     “Committed Loan Notice” means a notice of (a) a Committed Borrowing, (b) a conversion
of Committed Loans from one Type to the other, or (c) a continuation of Eurodollar Rate Loans,
pursuant to Section 2.02(a), which, if in writing, shall be substantially in the form of
Exhibit A.

     “Committed Reserves” means Proved Reserves attributable to Hydrocarbon Interests for
which the production of Hydrocarbons, natural gas liquids and carbon dioxide is contractually
committed to be gathered, treated, processed, stored or transported by, on, or at Midstream Assets
owned by the Borrower and its Restricted Subsidiaries pursuant to Services Contracts.

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

     “Consolidated” means the consolidation of any Person, in accordance with GAAP, with
its properly Consolidated Subsidiaries. References herein to a Person’s Consolidated financial
statements, financial condition, assets, liabilities, and similar references shall refer to the
Consolidated financial statements, financial condition, assets, liabilities, and similar references
of such Person and its properly Consolidated Subsidiaries. For avoidance of doubt, an Unrestricted
Subsidiary shall not be considered a Consolidated Subsidiary of the Borrower.

     “Consolidated Adjusted EBITDAX” means, for any period, Consolidated EBITDAX;
provided however, that if the Borrower or any Consolidated Restricted Subsidiary
shall consummate any Acquisition or Disposition permitted hereunder (including the Acquisition of
additional Restricted Subsidiaries, but exclusive of the Acquisition of Unrestricted Subsidiaries)
involving assets with a fair market value equal to or greater than the Threshold Amount during the
period of the four fiscal quarters ending on the last day of the fiscal quarter immediately
preceding the date of determination for which the most recent financial statements and related
Compliance Certificate were delivered to the Administrative Agent pursuant to Sections 6.01(a)
and (b) and Section 6.02(b), then Consolidated EBITDAX shall be calculated, in
a manner reasonably satisfactory to the Administrative Agent, (a) giving pro forma effect to such
Acquisition or Disposition as if such Acquisition or Disposition occurred on the first day of such
calculation period and (b) giving other pro forma adjustments for highly certain, clearly definable
and defensible items arising in connection with any Acquisition permitted hereunder which such
adjustments shall be made in a manner reasonably satisfactory to the Administrative Agent.

-6-

 

     “Consolidated EBITDAX” means, for any period, for the Borrower and its Consolidated
Restricted Subsidiaries on a Consolidated basis, an amount equal to Consolidated Net Income for
such period plus (a) the following to the extent deducted in calculating such Consolidated
Net Income: (i) Consolidated Interest Charges for such period, (ii) the provision for Federal,
state, local and foreign income tax expenses of the Borrower and its Consolidated Restricted
Subsidiaries for such period, (iii) all amounts attributable to depreciation, depletion and
amortization expenses for such period, (iv) non-cash losses or charges resulting under provisions
of FASB Statement of Financial Accounting Standards (“SFAS”) 133, as amended, or any SFAS
replacing, modifying or superseding such statement, resulting from the net change in Borrower’s (or
any Restricted Subsidiary’s) portfolio of commodity price risk management activities, (v) non-cash
losses or charges under provisions of SFAS 143 or SFAS 144, or any SFAS replacing, modifying or
superseding such statements, (vi) exploration and abandonment expenses to the extent deducted from
such Consolidated Net Income under successful efforts accounting, (vii) non-cash equity based
compensation expenses, (viii) non-cash losses on the disposition of assets, and (ix) other
non-recurring expenses of the Borrower and its Consolidated Restricted Subsidiaries reducing such
Consolidated Net Income which do not represent a cash item in such period or any future period and
minus (b) the following to the extent included in calculating such Consolidated Net Income:
(i) Federal, state, local and foreign income tax credits of the Borrower and its Consolidated
Restricted Subsidiaries for such period, (ii) non-cash gains or credits resulting under provisions
of SFAS 133, as amended, or any SFAS replacing, modifying or superseding such statement, resulting
from the net change in Borrower’s (or any Restricted Subsidiary’s) portfolio of commodity price
risk management activities, (iii) non-cash gains on the disposition of assets and (iv) all other
non-cash items increasing Consolidated Net Income for such period. For avoidance of doubt,
Consolidated Net Income attributable to Unrestricted Subsidiaries and Persons that are not
Subsidiaries shall not be considered in calculating Consolidated EBITDAX.

     “Consolidated Indebtedness” means, as of any date of determination, all Indebtedness
(without duplication) of the Borrower and its Consolidated Restricted Subsidiaries on a
Consolidated basis, excluding Indebtedness of the Unrestricted Subsidiaries, including any
Indebtedness proposed to be incurred on such date of determination and excluding (a) all
Indebtedness to be paid on such date of determination with the proceeds thereof and (b) excluding
any Indebtedness described in clause (g) of the definition of Indebtedness herein.

     “Consolidated Interest Charges” means, for any period, for the Borrower and its
Consolidated Restricted Subsidiaries on a consolidated basis, the sum of (a) all interest, premium
payments, debt discount, fees, charges and related expenses of the Borrower and its Consolidated
Restricted Subsidiaries in connection with borrowed money (including capitalized interest) or in
connection with the deferred purchase price of assets, in each case to the extent treated as
interest in accordance with GAAP, (b) the portion of rent expense of the Borrower and its
Consolidated Restricted Subsidiaries with respect to such period under capital leases that is
treated as interest in accordance with GAAP and (c) letter of credit fees actually paid, to the
extent treated as interest expense in accordance with GAAP.

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

-7-

 

     “Consolidated Leverage Ratio” means, as of any date of determination, the ratio of (a)
Consolidated Indebtedness as of such date to (b) Consolidated Adjusted EBITDAX for the period of
the four fiscal quarters most recently ended.

     “Consolidated Net Income” means, for any period, for the Borrower and its Consolidated
Restricted Subsidiaries on a Consolidated basis, the net income (or loss) of the Borrower and its
Consolidated Restricted Subsidiaries (excluding extraordinary gains and extraordinary losses) for
that period, exclusive of (a) the portion of net income (or loss) of the Borrower and its
Consolidated Restricted Subsidiaries allocable to minority interests in unconsolidated Persons or
Unrestricted Subsidiaries to the extent that cash dividends or distributions have not actually been
received by the Borrower or one of its Consolidated Restricted Subsidiaries and (b) the portion of
net income (or loss) of the Borrower and its Consolidated Restricted Subsidiaries allocable to any
Equity Interests in the Consolidated Restricted Subsidiaries that are owned by Persons other than
the Borrower and its Consolidated Restricted Subsidiaries.

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

     “Contribution Agreement” has the meaning given such term in the Partnership Agreement.

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

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

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

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

     “Default Rate” means (a) when used with respect to Obligations other than Letter of
Credit Fees, an interest rate equal to (i) the Base Rate plus (ii) the Applicable Rate, if
any, applicable to Base Rate Loans plus (iii) 2% per annum; provided,
however, that with respect to a Eurodollar Rate Loan, the Default Rate shall be an interest
rate equal to the interest rate (including any Applicable Rate) otherwise applicable to such Loan
plus 2% per annum, and (b) when used with respect to Letter of Credit Fees, a rate equal to the
Applicable Rate plus 2% per annum.

-8-

 

     “Determination Date” means each of (a) the Closing Date (after giving effect to the
Closing Transactions), (b) the last day of each fiscal quarter, (c) the date set forth in any PV to
Consolidated Indebtedness Compliance Certificate required to be delivered pursuant to Section
6.02(g), (d) the date specified in any Request for Credit Extension (other than a Committed
Loan Notice requesting only a conversion of Committed Loans to the other Type or a continuation of
Eurodollar Rate Loans), (e) the date specified in any certificate required to be delivered pursuant
to Section 2.14(f), (f) the date specified in any certificate required to be delivered
pursuant to Section 2.15(e), (g) the date of the consummation of any fundamental changes as
described in Section 7.03, and (h) the date any Restricted Payment permitted under
Section 7.09(c) is declared or made.

     “Defaulting Lender” means any Lender that (a) has failed to fund any portion of the
Committed Loans, participations in L/C Obligations or participations in Swing Line Loans required
to be funded by it hereunder within one Business Day of the date required to be funded by it
hereunder unless such failure has been cured, (b) has otherwise failed to pay over to the
Administrative Agent or any other Lender any other amount required to be paid by it hereunder
within one Business Day of the date when due, unless the subject of a good faith dispute or unless
such failure has been cured, or (c) has been deemed insolvent or become the subject of a bankruptcy
or insolvency proceeding.

     “Disclosed Matters” means the actions, suits and proceedings and the environmental
matters disclosed in Schedule 5.06, disclosed in any filing with the SEC or as otherwise
disclosed in writing from time to time to Administrative Agent.

     “Disposition” or “Dispose” means the sale, transfer, license, lease or other
disposition (including any sale and leaseback transaction) of any property by any Person, including
any sale, assignment, transfer or other disposal, with or without recourse, of any notes or
accounts receivable or any rights and claims associated therewith.

     “Dollar” and “$” mean lawful money of the United States.

     “Domestic Subsidiary” means any Subsidiary that is organized under the laws of any
political subdivision of the United States.

     “Eligible Assignee” means any Person that meets the requirements to be an assignee
under Section 10.06(b)(iii), (v) and (vi) (subject to such consents, if
any, as may be required under Section 10.06(b)(iii)).

     “Environmental Laws” means any and all Federal, state, local, and foreign statutes,
laws, regulations, ordinances, rules, judgments, orders, decrees, permits, concessions, grants,
franchises, licenses, agreements or governmental restrictions relating to pollution and the
protection of the environment or the release of any materials into the environment, including those
related to hazardous substances or wastes, air emissions and discharges to waste or public systems.

     “Environmental Liability” means any liability, contingent or otherwise (including any
liability for damages, costs of environmental remediation, fines, penalties or indemnities), of the

-9-

 

Borrower, any other Loan Party or any of their respective Subsidiaries directly or indirectly
resulting from or based upon (a) violation of any Environmental Law, (b) the generation, use,
handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) exposure
to any Hazardous Materials, (d) the release or threatened release of any Hazardous Materials into
the environment or (e) any contract, agreement or other consensual arrangement pursuant to which
liability is assumed or imposed with respect to any of the foregoing.

     “Equity Interests” means, with respect to any Person, all of the shares of capital
stock of (or other ownership or profit interests in) such Person, all of the warrants, options or
other rights for the purchase or acquisition from such Person of shares of capital stock of (or
other ownership or profit interests in) such Person, all of the securities convertible into or
exchangeable for shares of capital stock of (or other ownership or profit interests in) such Person
or warrants, rights or options for the purchase or acquisition from such Person of such shares (or
such other interests), and all of the other ownership or profit interests in such Person (including
partnership, member or trust interests therein), whether voting or nonvoting, and whether or not
such shares, warrants, options, rights or other interests are outstanding on any date of
determination.

     “Equity Offering” means the initial public offering of Equity Interests of the
Borrower pursuant to the terms of, and as described in, the Registration Statement.

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

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

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

     “Eurodollar Rate” means, for any Interest Period with respect to a Eurodollar Rate
Loan, the rate per annum equal to the British Bankers Association LIBOR Rate (“BBA LIBOR”),
as published by Reuters (or other commercially available source providing quotations of BBA LIBOR
as designated by the Administrative Agent from time to time) at approximately 11:00 a.m., London
time, two Business Days prior to the commencement of such Interest Period, for

-10-

 

Dollar deposits (for delivery on the first day of such Interest Period) with a term equivalent
to such Interest Period. If such rate is not available at such time for any reason, then the
“Eurodollar Rate” for such Interest Period shall be the rate per annum determined by the
Administrative Agent to be the rate at which deposits in Dollars for delivery on the first day of
such Interest Period in same day funds in the approximate amount of the Eurodollar Rate Loan being
made, continued or converted by Bank of America and with a term equivalent to such Interest Period
would be offered by Bank of America’s London Branch to major banks in the London interbank
eurodollar market at their request at approximately 11:00 a.m. (London time) two Business Days
prior to the commencement of such Interest Period.

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

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

     “Excluded Taxes” means, with respect to the Administrative Agent, any Lender, the L/C
Issuer or any other recipient of any payment to be made by or on account of any obligation of the
Borrower hereunder, (a) taxes imposed on or measured by its overall net income (however
denominated), and franchise taxes imposed on it (in lieu of net income taxes), by the jurisdiction
(or any political subdivision thereof) under the laws of which such recipient is organized or in
which its principal office is located or, in the case of any Lender, in which its applicable
Lending Office is located, (b) any branch profits taxes imposed by the United States or any similar
tax imposed by any other jurisdiction in which the Borrower is located and (c) in the case of a
Foreign Lender (other than an assignee pursuant to a request by the Borrower under Section
10.13), any withholding tax that is imposed on amounts payable to such Foreign Lender at the
time such Foreign Lender becomes a party hereto (or designates a new Lending Office) or is
attributable to such Foreign Lender’s failure or inability (other than as a result of a Change in
Law) to comply with Section 3.01(e), except to the extent that such Foreign Lender (or its
assignor, if any) was entitled, at the time of designation of a new Lending Office (or assignment),
to receive additional amounts from the Borrower with respect to such withholding tax pursuant to
Section 3.01(a).

     “Federal Funds Rate” means, for any day, the rate per annum equal to the weighted
average of the rates on overnight Federal funds transactions with members of the Federal Reserve
System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of
New York on the Business Day next succeeding such day; provided that (a) if such day is not
a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the
next preceding Business Day as so published on the next succeeding Business Day, and (b) if no such
rate is so published on such next succeeding Business Day, the Federal Funds Rate for such day
shall be the average rate (rounded upward, if necessary, to a whole multiple of 1/100 of 1%)
charged to Bank of America on such day on such transactions as determined by the Administrative
Agent.

     “Fee Letters” means the Arrangers’ Fee Letter and the Administrative Agent’s Fee
Letter.

     “Foreign Lender” means any Lender that is organized under the laws of a jurisdiction
other than that in which the Borrower is resident for tax purposes. For purposes of this

-11-

 

definition, the United States, each State thereof and the District of Columbia shall be deemed
to constitute a single jurisdiction.

     “Formation Merger Agreement” has the meaning specified in the Partnership Agreement.

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

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

     “GAAP” means generally accepted accounting principles in the United States set forth
in the opinions and pronouncements of the Accounting Principles Board and the American Institute of
Certified Public Accountants and statements and pronouncements of the Financial Accounting
Standards Board or such other principles as may be approved by a significant segment of the
accounting profession in the United States, that are applicable to the circumstances as of the date
of determination, consistently applied.

     “General Partner” means Pioneer Natural Resources GP LLC, a Delaware limited liability
company, and each other Person holding general partnership Equity Interests issued by the Borrower.

     “Governmental Authority” means the government of the United States or any other
nation, or of any political subdivision thereof, whether state or local, and any agency, authority,
instrumentality, regulatory body, court, central bank or other entity exercising executive,
legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to
government (including any supra-national bodies such as the European Union or the European Central
Bank).

     “Guarantee” of or by any Person (the “guarantor”) means (a) any obligation, contingent
or otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any
Indebtedness or other obligation of any other Person (the “primary obligor”) in any manner, whether
directly or indirectly, and including any obligation of the guarantor, direct or indirect, (i) to
purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or
other obligation or to purchase (or to advance or supply funds for the purchase of) any security
for the payment thereof, (ii) to purchase or lease property, securities or services for the purpose
of assuring the owner of such Indebtedness or other obligation of the payment thereof, or (iii) to
maintain working capital, equity capital or any other financial statement condition or liquidity of
the primary obligor so as to enable the primary obligor to pay such Indebtedness or other
obligation or (b) any Lien on any assets of the guarantor securing any Indebtedness or other
obligation of any other Person, whether or not such Indebtedness or other obligation is assumed by
the guarantor (or any right, contingent or otherwise, of any holder of such Indebtedness to obtain
any such Lien), provided, that the term Guarantee shall not include endorsements for
collection or deposit in the ordinary course of business. The amount of any Guarantee shall be
deemed to be an amount equal to the stated or determinable amount of the related primary
obligation, or portion thereof, in respect of which such Guarantee is made or, if

-12-

 

not stated or determinable, the maximum reasonably anticipated liability in respect thereof as
determined by the guaranteeing Person in good faith. The term “Guarantee” as a verb has a
corresponding meaning.

     “Guarantors” means, collectively, the Operating Company and each other Restricted
Subsidiary of the Borrower which now or hereafter executes and delivers a guaranty to the
Administrative Agent pursuant to Section 4.01 or Section 6.12 and any other Person
who has guaranteed some or all of the Obligations and who has been accepted by the Administrative
Agent as a Guarantor.

     “Guaranty” means the Guaranty made by the Guarantors in favor of the Administrative
Agent, L/C Issuer and the Lenders, substantially in the form of Exhibit F.

     “Hazardous Materials” means all explosive or radioactive substances or wastes and all
hazardous or toxic substances, wastes or other pollutants, including petroleum or petroleum
distillates, asbestos or asbestos-containing materials, polychlorinated biphenyls, radon gas,
infectious or medical wastes and all other substances or wastes of any nature regulated pursuant to
any Environmental Law.

     “Hydrocarbon Interests” means all rights, titles, interests and estates, now owned or
hereafter acquired, in and to or arising out of oil and gas leases, oil, gas and mineral leases, or
other liquid or gaseous hydrocarbon leases, mineral fee or lease interests, farm-outs, overriding
royalty and royalty interests, net profit interests, oil payments, production payment interests and
similar mineral interests, including any reserved or residual interest of whatever nature.

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

     “Indebtedness” of any Person means, without duplication,:

     (a) all obligations of such Person for borrowed money;

     (b) all obligations of such Person evidenced by bonds, debentures, notes or similar
instruments;

     (c) all obligations of such Person in respect of the deferred purchase price of
property or services (other than customary payment terms taken in the ordinary course of
business);

     (d) all Indebtedness of others secured by (or for which the holder of such Indebtedness
has an existing right, contingent or otherwise, to be secured by) any Lien on property owned
or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed
limited, however to the lesser of (1) the amount of its liability or (2) the book value of
such property;

-13-

 

     (e) all Guarantees by such Person of Indebtedness of others;

     (f) all Capital Lease Obligations of such Person;

     (g) all obligations, contingent or otherwise, of such Person as an account party in
respect of letters of credit;

     (h) all obligations, contingent or otherwise, of such Person in respect of bankers’
acceptances;

     (i) the amount of deferred revenue attributed to any forward sale of production for
which such Person has received payment in advance other than on ordinary trade terms;

     (j) all Synthetic Lease Obligations of such Person; 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.

     The Indebtedness of any Person shall include the Indebtedness of any other entity (including
any partnership in which such Person is a general partner) to the extent such Person is liable
therefor as a result of such Person’s ownership interest in or other relationship with such entity,
except to the extent the terms of such Indebtedness provide that such Person is not liable
therefor.

     “Indemnified Taxes” means Taxes other than Excluded Taxes.

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

     “Information” has the meaning specified in Section 10.07.

     “Initial Reserve Report” means the engineering report concerning the Oil and Gas
Properties to be owned by the Operating Company pursuant to the terms of the Closing Transactions
Documents, prepared by Pioneer, as of December 31, 2006, and audited by Netherland, Sewell &
Associates, Inc. as of October 10, 2007.

     “Interest Payment Date” means, (a) as to any Loan other than a Base Rate Loan, the
last day of each Interest Period applicable to such Loan and the Maturity Date; provided,
however, that if any Interest Period for a Eurodollar Rate Loan exceeds three months, the
respective dates that fall every three months after the beginning of such Interest Period shall
also be Interest Payment Dates; and (b) as to any Base Rate Loan (including a Swing Line Loan), the
last Business Day of each March, June, September and December and the Maturity Date.

     “Interest Period” means, as to each Eurodollar Rate Loan, the period commencing on the
date such Eurodollar Rate Loan is disbursed or converted to or continued as a Eurodollar Rate Loan
and ending on the date one, two, three or six months, or with the consent of the Administrative
Agent and all Lenders, nine or twelve months, thereafter, as selected by the Borrower in its
Committed Loan Notice; provided that:

-14-

 

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

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

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

     “Investment” means, as to any Person, any direct or indirect acquisition or investment
by such Person, whether by means of (a) the purchase or other acquisition of capital stock or other
securities of another Person or (b) a loan, advance or capital contribution to (whether in cash,
cash equivalents or in kind), Guarantee of Indebtedness of, or purchase or other acquisition of any
other Indebtedness or equity participation or interest in, another Person, including any
partnership or joint venture interest in such other Person and any arrangement pursuant to which
the investor Guarantees Indebtedness of such other Person. For purposes of covenant compliance,
the amount of any Investment shall be the amount actually invested, without adjustment for
subsequent increases or decreases in the value of such Investment.

     “IRS” means the United States Internal Revenue Service.

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

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

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

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

     “L/C Borrowing” means an extension of credit resulting from a drawing under any Letter
of Credit which has not been reimbursed on the date when made or refinanced as a Committed
Borrowing.

-15-

 

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

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

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

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

     “Lender Counterparty” means any counterparty under a Swap Contract that was a Lender
(or an Affiliate of a Lender) at the time such Swap Contract was entered into.

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

     “Letter of Credit” means any letter of credit issued hereunder. A Letter of Credit
may be a commercial letter of credit or a standby letter of credit.

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

     “Letter of Credit Expiration Date” means the day that is seven days prior to the
Maturity Date then in effect (or, if such day is not a Business Day, the next preceding Business
Day).

     “Letter of Credit Fee” has the meaning specified in Section 2.03(i).

     “Letter of Credit Sublimit” means an amount equal to $50,000,000. The Letter of
Credit Sublimit is part of, and not in addition to, the Aggregate Commitments.

     “Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien,
pledge, hypothecation, or security interest in, on or of such asset, or any other charge or
encumbrance on any such asset to secure Indebtedness or liabilities, but excluding any right to
netting or setoff (b) the interest of a vendor or a lessor under any conditional sale agreement,
capital lease or title retention agreement (or any financing lease having substantially the same
economic effect as any of the foregoing) relating to such asset and (c) in the case of securities,
any purchase option, call or similar right of a third party with respect to such securities.

     “LLC Interest Sale Agreement” has the meaning specified in the Partnership Agreement.

-16-

 

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

     “Loan Documents” means this Agreement, each Note, each Issuer Document, the Fee
Letters, and the Guaranty.

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

     “Material Adverse Effect” means a material adverse effect on (a) the operations,
business, assets or financial condition of the Borrower and the Restricted Subsidiaries taken as a
whole; (b) the ability of the Borrower and the Guarantors to perform their obligations, taken as a
whole, under this Agreement and the other Loan Documents; or (c) the rights of, or benefits
available to, the Administrative Agent, L/C Issuer or Lenders under this Agreement and the other
Loan Documents.

     “Material Contract” means (a) the Omnibus Agreement and the Omnibus Operating
Agreement and (b) any other contract that is a “material contract” as such term is described in
Item 601 of Regulation S-K as issued by the SEC in which the Borrower or any other Loan Party is a
party on the one hand, and Pioneer or one of its Affiliates (other than the Borrower and its
Subsidiaries) is a party on the other hand, and of which breach, nonperformance, cancellation or
failure to renew could reasonably be expected to have a Material Adverse Effect.

     “Material Indebtedness” means (a) Indebtedness (other than the Loans and Letters of
Credit), or (b) obligations in respect of one or more Swap Contracts, in each case under clause (a)
or (b) of any one or more of the Borrower and its Restricted Subsidiaries in an aggregate principal
amount exceeding the Threshold Amount. For purposes of determining Material Indebtedness, the
“principal amount” of the obligations of the Borrower or any Restricted Subsidiary in respect of
any Swap Contracts at any time shall be the Swap Termination Value owed by the Borrower or such
Restricted Subsidiary.

     “Maturity Date” means the later of (a) the date that is the fifth anniversary of the
Closing Date and (b) if maturity is extended pursuant to Section 2.14, such extended
maturity date as determined pursuant to such Section (it being understood and agreed that any such
maturity shall not be deemed extended for any Lender that has not consented to such extension);
provided, however, that, in each case, if such date is not a Business Day, the
Maturity Date shall be the next preceding Business Day.

     “Midstream Assets” means (a) assets used primarily for gathering, transmission,
storage, processing or treatment of natural gas, natural gas liquids, carbon dioxide or other
Hydrocarbons and (b) Equity Interests of any Person that has no substantial assets other than
assets referred to in the foregoing clause (a).

     “Midstream Assets Report” means a report prepared as of December 31 of each year by
the Borrower with respect to the Midstream Assets of the Borrower and the Restricted Subsidiaries,
other than Equity Interests, which report shall evaluate the Proved Reserves attributable to the
Committed Reserves and shall include (a) a calculation of the net cash flow and the PV of net cash
flows projected to be attributable to any anticipated gathering, treatment,

-17-

 

transmission, storage and processing of Hydrocarbons and carbon dioxide expected to be
produced from the Committed Reserves, and (b) will set forth in reasonable detail, a report of
revenues by product, operating expenses and capital expenditures associated with the Midstream
Assets, in each case on a year-by-year basis and audited at least as to 80% of the net present
value of all such cash flows by Gaffney, Cline & Associates, Ryder Scott Company, Netherland,
Sewell & Associates, Inc. or another independent engineering firm selected by the Borrower and
reasonably acceptable to the Administrative Agent.

     “Moody’s” means Moody’s Investors Service, Inc. and any successor thereto.

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

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

     “Non-Recourse Debt” means any Indebtedness of a Subsidiary, in each case in respect of
which the holder or holders of such Indebtedness (a) shall have recourse only to, and shall have
the right to require the obligations of such Subsidiary to be performed, satisfied, and paid only
out of, the assets, revenues and other property of such Subsidiary and/or one or more of its
Subsidiaries and/or any other Person (other than the Borrower and/or any Restricted Subsidiary),
and (b) shall have no direct or indirect recourse (including by way of guaranty or indemnity) to
the Borrower or any Restricted Subsidiary or to any of the assets, revenues or other property of
the Borrower or any Restricted Subsidiary, whether for principal, interest, fees, expenses or
otherwise.

     “Obligations” means all advances to, and debts, liabilities, obligations, covenants
and duties of, any Loan Party arising under any Loan Document or otherwise with respect to any Loan
or Letter of Credit or any Swap Contract executed with a Lender Counterparty, whether direct or
indirect (including those acquired by assumption), absolute or contingent, due or to become due,
now existing or hereafter arising and including interest and fees that accrue after the
commencement by or against any Loan Party or any Affiliate thereof of any proceeding under any
Debtor Relief Laws naming such Person as the debtor in such proceeding, regardless of whether such
interest and fees are allowed claims in such proceeding.

     “Oil and Gas Properties” means Hydrocarbon Interests; the properties now or hereafter
pooled or unitized with 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 having jurisdiction) which may affect all or any portion of the Hydrocarbon Interests;
all interests held in royalty trusts whether presently existing or hereafter created; all
Hydrocarbons in and under and which may be produced, saved, processed or attributable to the
Hydrocarbon Interests, the lands covered thereby and all Hydrocarbons in pipelines, gathering
lines, tanks and processing plants and all rents, issues, profits, proceeds, products, revenues and
other incomes from or attributable to the Hydrocarbon Interests; all tenements, hereditaments,

-18-

 

appurtenances and properties in any way appertaining, belonging, affixed or incidental to the
Hydrocarbon Interests, and all rights, titles, interests and estates described or referred to
above, including any and all real property, now owned or hereafter acquired, used or held for use
in connection with the operating, working or development of any of such Hydrocarbon Interests or
property and including any and all surface leases, rights-of-way, easements and servitudes together
with all additions, substitutions, replacements, accessions and attachments to any and all of the
foregoing; all oil, gas and mineral leasehold and fee interests, all overriding royalty interests,
mineral interests, royalty interests, net profits interests, net revenue interests, oil payments,
production payments, carried interests and any and all other interests in Hydrocarbons; in each
case whether now owned or hereafter acquired directly or indirectly.

     “Omnibus Agreement” means that certain Omnibus Agreement, dated effective as of the
Closing Date, among the Borrower, the General Partner, Pioneer, and Pioneer Natural Resources USA,
Inc., as may be amended, restated, or otherwise modified from time to time in accordance with this
Agreement.

     “Omnibus Operating Agreement” has the meaning specified in the Partnership Agreement.

     “Operating Company” means Pioneer Southwest Energy Partners USA LLC, a Texas limited
liability company, and its permitted successors and assigns.

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

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

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

-19-

 

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

     “Partnership Agreement” means that certain First Amended and Restated Agreement of
Pioneer Southwest Energy Partners L.P., dated as of the Closing Date, as may be amended, restated,
or otherwise modified from time to time in accordance with this Agreement.

     “PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA
and any successor entity performing similar functions.

     “Pension Plan” means any “employee pension benefit plan” (as such term is defined in
Section 3(2) of ERISA), other than a Multiemployer Plan, that is subject to Title IV of ERISA and
is sponsored or maintained by the Borrower or any ERISA Affiliate or to which the Borrower or any
ERISA Affiliate contributes or has an obligation to contribute, or in the case of a multiple
employer or other plan described in Section 4064(a) of ERISA, has made contributions at any time
during the immediately preceding five plan years.

     “Permitted Encumbrances” means:

     (a) Liens imposed by law for taxes, assessments, or other governmental charges or
levies that are not yet delinquent or are being contested in compliance with Section
6.05;

     (b) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s, landlords,
vendors, workmen, operators, and other like Liens arising in the ordinary course of business
or incident to the exploration, development, operation, processing and maintenance of
Hydrocarbons and related facilities and assets and securing obligations that are not overdue
by more than 90 days or are being contested in compliance with Section 6.05;

     (c) pledges and deposits made in the ordinary course of business in compliance with
workers’ compensation, unemployment insurance, and other social security laws or
regulations;

     (d) deposits to secure the performance of bids, tenders, 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;

     (e) judgment liens in respect of judgments that do not constitute an Event of Default
under Section 8.01(h);

     (f) easements, zoning restrictions, rights-of-way, servitudes, permits, conditions,
exceptions, reservations, and similar encumbrances on real property imposed by law or
arising in the ordinary course of business that do not secure any Indebtedness and do not
materially interfere with the ordinary conduct of business of the Borrower or any Restricted
Subsidiary;

     (g) legal or equitable encumbrances deemed to exist by reason of negative pledges such
as in Section 7.02 of this Agreement or the existence of any litigation or

-20-

 

other legal proceeding and any related lis pendens filing (excluding any attachment
prior to judgment, judgment lien or attachment lien in aid of execution on a judgment);

     (h) rights of a common owner of any interest in property held by Borrower or any
Restricted Subsidiary as a common owner;

     (i) farmout, carried working interest, joint operating, unitization, royalty,
overriding royalty, sales, area of mutual interest, division order, joint venture,
partnership and similar agreements relating to the exploration or development of, or
production from, oil and gas properties incurred in the ordinary course of business;

     (j) Liens arising pursuant to Section 9.343 of the Texas Uniform Commercial Code or
other similar statutory provisions of other states with respect to production purchased from
others;

     (k) any defects, irregularities, or deficiencies in title to easements, rights-of-way,
or other properties which do not in the aggregate have a Material Adverse Effect;

     (l) Liens on the stock or other ownership interest of or in any Unrestricted
Subsidiary, provided that there is no recourse to the Borrower or any Restricted
Subsidiary other than recourse to such stock or other ownership interest and proceeds
thereof;

     (m) Liens resulting from the deposit of funds or evidences of Indebtedness in trust for
the purpose of defeasing Indebtedness of the Borrower or any Restricted Subsidiary;

     (n) Liens arising under customary letter of credit reimbursement agreements and
customary deposit account agreement, and similar agreements entered into in the ordinary
course of business with respect to instruments or money in the possession of the other party
thereto in the ordinary course of business; and

     (o) Liens in renewal or extension of any of the foregoing permitted Liens, so long as
limited to the property or assets encumbered and the amounts of indebtedness secured
immediately prior to such renewal or extension is not increased.

     “Person” means any natural person, corporation, limited liability company, trust,
joint venture, association, company, partnership, Governmental Authority or other entity.

     “Pioneer” means Pioneer Natural Resources Company, a Delaware corporation, and for
purposes other than clause (e) of the definition of the term “Change of Control”, its successor or
the surviving entity resulting from a merger, consolidation or similar reorganization or
restructuring transaction, or a parent or subsidiary thereof, as long as such successor or
surviving entity does not give rise to a Change of Control under clause (e) of the definition of
the term “Change of Control”.

     “Pioneer Credit Agreement” means that certain Amended and Restated 5-Year Revolving
Credit Agreement, dated as of April 11, 2007, among Pioneer, JPMorgan Chase Bank, N.A. as

-21-

 

administrative agent, and the other parties thereto, as amended, restated or otherwise
modified from time to time.

     “Pioneer VPP Conveyance” means the Conveyance of Term Overriding Royalty Interest from
Pioneer Natural Resources USA, Inc. and Pioneer Natural Resources Properties LP to Wolfcamp Oil and
Gas Trust dated April 18, 2005.

     “Plan” means any “employee benefit plan” (as such term is defined in Section 3(3) of
ERISA) established by the Borrower or, with respect to any such plan that is subject to Section 412
of the Code or Title IV of ERISA, any ERISA Affiliate.

     “Platform” has the meaning specified in Section 6.02(g).

     “Proved Reserves” means the estimated quantities of crude oil, condensate, natural gas
and natural gas liquids that adequate geological and engineering data demonstrate with reasonable
certainty to be recoverable in future years from proved reservoirs under existing economic and
operating conditions (i.e., prices and costs as of the date the estimate is made).

     “PV” means, as of any date of calculation, the calculation of the net present value of
projected future cash flows from (a) Proved Reserves based upon the most recently delivered Reserve
Report (using the discount rate and the customary price deck of the Administrative Agent as of the
date of calculation (which such discount rate as of the Closing Date is 9%) and giving effect to
the Borrower’s hedging arrangements with Qualified Counterparties and long-term contracts) and (b)
Midstream Assets that are attributable to the anticipated gathering, treatment, transmission,
storage and processing of Hydrocarbons and carbon dioxide expected to be produced from Committed
Reserves during the remaining expected economic lives of such reserves, based upon the most
recently delivered Midstream Assets Report (using the discount rate of the Administrative Agent as
of date of calculation (which such discount rate as of the Closing Date is 9%) and giving effect to
the Borrower’s hedging arrangements with Qualified Counterparties and Services Contracts;
provided, however, that for any Services Contracts in which the sales price is
based upon fluctuating market prices, calculations will be based on the customary price deck of the
Administrative Agent as of the date of such calculation, with appropriate adjustments for product
and location differentials). For purposes of calculating the PV under clause (a), a maximum of 20%
of the PV value will be included from Proved Reserves that are not proved developed producing
reserves. If during the period between the December 31 effective dates of the Reserve Reports and
Midstream Assets Reports, the aggregate fair market value, in the reasonable opinion of the
Borrower, of Oil and Gas Properties and Midstream Assets disposed of or purchased by the Borrower
and the Restricted Subsidiaries shall exceed the Threshold Amount, then the PV for such period
shall be reduced or increased, as the case may be, at the end of each fiscal quarter occurring
during such period, by an amount equal to the value assigned such Oil and Gas Properties or
Midstream Assets, as applicable, in the most recent calculation of the PV for such period (or if no
value was assigned, by an amount agreed to by the Borrower and the Administrative Agent). PV shall
reflect the deferred revenue with respect to volumetric production payments included in
Consolidated Indebtedness, at a value that is equal to the amount of deferred revenues so included
in Consolidated Indebtedness.

-22-

 

     “PV to Consolidated Indebtedness Compliance Certificate” means a certificate of a
Responsible Officer of the General Partner setting forth reasonably detailed calculations
demonstrating compliance with Section 7.04(b) and delivered in accordance with Section
6.02(g). 

     “Public Lender” has the meaning specified in Section 6.02(g).

     “Qualified Counterparty” means (a) any Lender Counterparty, (b) any other Person,
other than the Borrower and the Restricted Subsidiaries, who, at the time a Swap Contract is
executed with the Borrower or a Restricted Subsidiary has, or whose guarantor of the obligations of
such Person has, a senior long-term unsecured debt obligations rating of BBB- or better issued by
S&P and Baa3 or better by Moody’s, in each case with a stable outlook or (c) Pioneer or one of its
Affiliates, other than the Borrower and its Subsidiaries, as long as such Affiliate’s obligations
are Guaranteed by Pioneer, but only with respect to those Swap Contracts assigned or novated to, or
executed by, the Borrower or a Restricted Subsidiary on the Closing Date as such Swap Contracts are
more specifically described in the Registration Statement.

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

     “Registration Statement” means the Form S-1 Registration Statement filed by the
Borrower with the SEC as Registration No. 333-144868, as amended from time to time prior to the
Closing Date.

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

     “Reportable Event” means any of the events set forth in Section 4043(c) of ERISA,
other than events for which the 30 day notice period has been waived.

     “Request for Credit Extension” means (a) with respect to a Borrowing, conversion or
continuation of Committed Loans, a Committed Loan Notice, (b) with respect to an L/C Credit
Extension, a Letter of Credit Application, and (c) with respect to a Swing Line Loan, a Swing Line
Loan Notice.

     “Required Lenders” means, as of any date of determination, Lenders having more than
50% of the Aggregate Commitments or, if the commitment of each Lender to make Loans and the
obligation of the L/C Issuer to make L/C Credit Extensions have been terminated pursuant to
Section 8.02, Lenders holding in the aggregate more than 50% of the Total Outstandings
(with the aggregate amount of each Lender’s risk participation and funded participation in L/C
Obligations and Swing Line Loans being deemed “held” by such Lender for purposes of this
definition); provided that the Commitment of, and the portion of the Total Outstandings
held or deemed held by, any Defaulting Lender shall be excluded for purposes of making a
determination of Required Lenders.

     “Reserve Report” means the Initial Reserve Report and a report prepared as of December
31 of each year by the Borrower with respect to the Oil and Gas Properties of the Borrower and

-23-

 

the Restricted Subsidiaries and audited at least as to 80% of the net present value of all
such Proved Reserves by Gaffney, Cline & Associates, Ryder Scott Company, Netherland, Sewell &
Associates, Inc. or another independent engineering firm selected by the Borrower and reasonably
acceptable to the Administrative Agent.

     “Responsible Officer” means the chief executive officer, president, chief financial
officer, chief accounting officer, treasurer, assistant treasurer or controller of a Loan Party or,
in the case of the Borrower, of the General Partner (or if a Loan Party has no officers, the
corresponding officers of such Loan Party’s member, manager or general partner, as applicable) and,
solely for purposes of notices given pursuant to Article II, any other officer or employee
of the applicable Loan Party so designated by any of the foregoing officers in a written notice to
the Administrative Agent. Any document delivered hereunder that is signed by a Responsible Officer
of a Loan Party shall be conclusively presumed to have been authorized by all necessary corporate,
partnership and/or other action on the part of such Loan Party and such Responsible Officer shall
be conclusively presumed to have acted on behalf of such Loan Party.

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

     “Restricted Subsidiary” means any Subsidiary that is not an Unrestricted Subsidiary.

     “S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill
Companies, Inc. and any successor thereto.

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

     “Services Agreement” has the meaning specified in the Partnership Agreement.

     “Services Contract” means all contracts, agreements or arrangements for the gathering,
transporting, treatment, storage or processing of Hydrocarbons by, through or in connection with a
processing plant, pipeline or other Midstream Asset owned by the Borrower and its Restricted
Subsidiaries.

     “Specified Acquisition” means an Acquisition (or series of related Acquisitions)
permitted hereunder occurring on or after the Closing Date of any Person, property, business or
asset by the Borrower or any Restricted Subsidiary (other than an Acquisition from the Borrower or
a Restricted Subsidiary), to the extent not subsequently sold, transferred or otherwise Disposed by
the Borrower or such Restricted Subsidiary, for an aggregate purchase price of not less than
$25,000,000.

-24-

 

     “Subsidiary” of a Person means a corporation, partnership, joint venture, limited
liability company or other business entity of which a majority of the shares of securities or other
interests having ordinary voting power for the election of directors or other governing body (other
than securities or interests having such power only by reason of the happening of a contingency)
are at the time beneficially owned, or the management of which is otherwise controlled, directly,
or indirectly through one or more intermediaries, or both, by such Person. Unless otherwise
specified, all references herein to a “Subsidiary” or to “Subsidiaries” shall refer to a Subsidiary
or Subsidiaries of the Borrower.

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

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

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

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

     “Swing Line Loan” has the meaning specified in Section 2.04(a).

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

-25-

 

     “Swing Line Sublimit” means an amount equal to the lesser of (a) $50,000,000 and (b)
the Aggregate Commitments. The Swing Line Sublimit is part of, and not in addition to, the
Aggregate Commitments.

     “Syndication Agent” means Wells Fargo Bank, N.A. in its capacity as syndication agent
under any of the Loan Documents, or any successor syndication agent.

     “Synthetic Lease Obligation” of any Person means the monetary obligations of such
Person under (a) a so-called synthetic, off-balance sheet or tax retention lease, or (b) an
agreement for the use or possession of property creating obligations that do not appear on the
balance sheet of such Person but which, upon the insolvency or bankruptcy of such Person, would be
characterized as the indebtedness of such Person (without regard to accounting treatment), and the
amount of such obligations shall be the capitalized amount of the remaining lease payments under
the relevant lease that would appear on the balance sheet of such Person determined in accordance
with GAAP if such lease were accounted for as a capital lease.

     “Taxes” means all present or future taxes, levies, imposts, duties, deductions,
withholdings, assessments, fees or other charges imposed by any Governmental Authority, including
any interest, additions to tax or penalties applicable thereto.

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

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

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

     “Unaudited Financial Statements” means (a) the unaudited pro forma Consolidated
balance sheet of the Borrower and its Consolidated Subsidiaries as of September 30, 2007 after
giving effect to the Closing Transactions, and the related pro forma Consolidated statements of
operations for the year ended December 31, 2006 and for the nine months ended September 30, 2007
and (b) the unaudited Consolidated balance sheet of the predecessor to the Borrower and its
Consolidated Subsidiaries as of September 30, 2007, and the related Consolidated statements of
operations, changes in equity and cash flows for the nine months ended on that date, in each case,
including the notes thereto and as reflected in the Registration Statement.

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

     “United States” and “U.S.” mean the United States of America.

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

     “Unrestricted Subsidiary” means any Subsidiary which the Borrower has designated in
writing to the Administrative Agent to be an Unrestricted Subsidiary pursuant to Section
6.12

-26-

 

and which the Borrower has not designated to be a Restricted Subsidiary pursuant to Section
6.12 and any Subsidiary of an Unrestricted Subsidiary.

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

     (a) The definitions of terms herein shall apply equally to the singular and plural forms of
the terms defined. Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. The words “include,” “includes” and
“including” shall be deemed to be followed by the phrase “without limitation.” The word
“will” shall be construed to have the same meaning and effect as the word “shall.”
Unless the context requires otherwise, (i) any definition of or reference to any agreement,
instrument or other document (including any Organization Document) shall be construed as referring
to such agreement, instrument or other document as from time to time amended, supplemented or
otherwise modified (subject to any restrictions on such amendments, supplements or modifications
set forth herein or in any other Loan Document), (ii) any reference herein to any Person shall be
construed to include such Person’s successors and assigns, (iii) the words “herein,”
“hereof” and “hereunder,” and words of similar import when used in any Loan
Document, shall be construed to refer to such Loan Document in its entirety and not to any
particular provision thereof, (iv) all references in a Loan Document to Articles, Sections,
Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and
Schedules to, the Loan Document in which such references appear, (v) any reference to any law shall
include all statutory and regulatory provisions consolidating, amending, replacing or interpreting
such law and any reference to any law or regulation shall, unless otherwise specified, refer to
such law or regulation as amended, modified or supplemented from time to time, and (vi) the words
“asset” and “property” shall be construed to have the same meaning and effect and
to refer to any and all tangible and intangible assets and properties, including cash, securities,
accounts and contract rights.

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

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

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

     (b) Changes in GAAP. If at any time any change in GAAP would affect the computation
of any financial ratio or requirement set forth in any Loan Document, and either the Borrower or
the Required Lenders shall so request, the Administrative Agent, the Lenders and

-27-

 

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

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

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

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

ARTICLE II.

THE COMMITMENTS AND CREDIT EXTENSIONS

     2.01 Committed Loans. Subject to the terms and conditions set forth herein, each Lender
severally agrees to make loans (each such loan, a “Committed Loan”) to the Borrower from
time to time, on any Business Day during the Availability Period, in an aggregate amount not to
exceed at any time outstanding the amount of such Lender’s Commitment; provided,
however, that after giving effect to any Committed Borrowing, (i) the Total Outstandings
shall not exceed the Aggregate Commitments, and (ii) the aggregate Outstanding Amount of the
Committed Loans of any Lender, plus such Lender’s Applicable Percentage of the Outstanding
Amount of all L/C Obligations, plus such Lender’s Applicable Percentage of the Outstanding
Amount of all Swing Line Loans shall not exceed such Lender’s Commitment. Within the limits of
each Lender’s Commitment, and subject to the other terms and conditions hereof, the Borrower may
borrow under this Section 2.01, prepay under Section 2.05, and reborrow under this
Section 2.01. Committed Loans may be Base Rate Loans or Eurodollar Rate Loans, as further
provided herein.

     2.02 Borrowings, Conversions and Continuations of Committed Loans.

     (a) Each Committed Borrowing, each conversion of Committed Loans from one Type to the other,
and each continuation of Eurodollar Rate Loans shall be made upon the

-28-

 

Borrower’s irrevocable notice to the Administrative Agent, which may be given by telephone.
Each such notice must be received by the Administrative Agent not later than 12:00 noon (i) three
Business Days prior to the requested date of any Borrowing of, conversion to or continuation of
Eurodollar Rate Loans or of any conversion of Eurodollar Rate Loans to Base Rate Committed Loans,
and (ii) on the requested date of any Borrowing of Base Rate Committed Loans. Each telephonic
notice by the Borrower pursuant to this Section 2.02(a) must be confirmed promptly by
delivery to the Administrative Agent of a written Committed Loan Notice, appropriately completed
and signed by a Responsible Officer of the Borrower. Each Borrowing of, conversion to or
continuation of Eurodollar Rate Loans shall be in a principal amount of $5,000,000 or a whole
multiple of $1,000,000 in excess thereof. Except as provided in Sections 2.03(c) and
2.04(c), each Borrowing of or conversion to Base Rate Committed Loans shall be in a
principal amount of $5,000,000 or a whole multiple of $1,000,000 in excess thereof. Each Committed
Loan Notice (whether telephonic or written) shall specify (i) whether the Borrower is requesting a
Committed Borrowing, a conversion of Committed Loans from one Type to the other, or a continuation
of Eurodollar Rate Loans, (ii) the requested date of the Borrowing, conversion or continuation, as
the case may be (which shall be a Business Day), (iii) the principal amount of Committed Loans to
be borrowed, converted or continued, (iv) the Type of Committed Loans to be borrowed or to which
existing Committed Loans are to be converted, and (v) if applicable, the duration of the Interest
Period with respect thereto. If the Borrower fails to specify a Type of Committed Loan in a
Committed Loan Notice or if the Borrower fails to give a timely notice requesting a conversion or
continuation, then the applicable Committed Loans shall be made as, or converted to, Base Rate
Loans. Any such automatic conversion to Base Rate Loans shall be effective as of the last day of
the Interest Period then in effect with respect to the applicable Eurodollar Rate Loans. If the
Borrower requests a Borrowing of, conversion to, or continuation of Eurodollar Rate Loans in any
such Committed Loan Notice, but fails to specify an Interest Period, it will be deemed to have
specified an Interest Period of one month.

     (b) Following receipt of a Committed Loan Notice, the Administrative Agent shall promptly
notify each Lender of the amount of its Applicable Percentage of the applicable Committed Loans,
and if no timely notice of a conversion or continuation is provided by the Borrower, the
Administrative Agent shall notify each Lender of the details of any automatic conversion to Base
Rate Loans described in the preceding subsection. In the case of a Committed Borrowing, each
Lender shall make the amount of its Committed Loan available to the Administrative Agent in
immediately available funds at the Administrative Agent’s Office not later than 2:00 p.m. on the
Business Day specified in the applicable Committed Loan Notice. Upon satisfaction of the
applicable conditions set forth in Section 4.02 (and, if such Borrowing is the initial
Credit Extension, Section 4.01), the Administrative Agent shall make all funds so received
available to the Borrower in like funds as received by the Administrative Agent either by (i)
crediting the account of the Borrower on the books of Bank of America with the amount of such funds
or (ii) wire transfer of such funds, in each case in accordance with instructions provided to (and
reasonably acceptable to) the Administrative Agent by the Borrower; provided,
however, that if, on the date the Committed Loan Notice with respect to such Borrowing is
given by the Borrower, there are L/C Borrowings outstanding, then the proceeds of such Borrowing,
first, shall be applied to the payment in full of any such L/C Borrowings, and
second, shall be made available to the Borrower as provided above.

-29-

 

     (c) Except as otherwise provided herein, a Eurodollar Rate Loan may be continued or converted
only on the last day of an Interest Period for such Eurodollar Rate Loan. During the existence of
a Default, no Loans may be requested as, converted to or continued as Eurodollar Rate Loans without
the consent of the Required Lenders.

     (d) The Administrative Agent shall promptly notify the Borrower and the Lenders of the
interest rate applicable to any Interest Period for Eurodollar Rate Loans upon determination of
such interest rate. At any time that Base Rate Loans are outstanding, the Administrative Agent
shall notify the Borrower and the Lenders of any change in Bank of America’s prime rate used in
determining the Base Rate promptly following the public announcement of such change.

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

     2.03 Letters of Credit.

     (a) The Letter of Credit Commitment.

     (i) Subject to the terms and conditions set forth herein, (A) the L/C Issuer agrees, in
reliance upon the agreements of the Lenders set forth in this Section 2.03, (1) from
time to time on any Business Day during the period from the Closing Date until the Letter of
Credit Expiration Date, to issue Letters of Credit for the account of the Borrower or its
Restricted Subsidiaries, and to amend or extend Letters of Credit previously issued by it,
in accordance with subsection (b) below, and (2) to honor drawings under the Letters of
Credit; and (B) the Lenders severally agree to participate in Letters of Credit issued for
the account of the Borrower or its Restricted Subsidiaries and any drawings thereunder;
provided that after giving effect to any L/C Credit Extension with respect to any
Letter of Credit, (x) the Total Outstandings shall not exceed the Aggregate Commitments, (y)
the aggregate Outstanding Amount of the Committed Loans of any Lender, plus such
Lender’s Applicable Percentage of the Outstanding Amount of all L/C Obligations,
plus such Lender’s Applicable Percentage of the Outstanding Amount of all Swing Line
Loans shall not exceed such Lender’s Commitment, and (z) the Outstanding Amount of the L/C
Obligations shall not exceed the Letter of Credit Sublimit. Each request by the Borrower
for the issuance or amendment of a Letter of Credit shall be deemed to be a representation
by the Borrower that the L/C Credit Extension so requested complies with the conditions set
forth in the proviso to the preceding sentence. Within the foregoing limits, and subject to
the terms and conditions hereof, the Borrower’s ability to obtain Letters of Credit shall be
fully revolving, and accordingly the Borrower may, during the foregoing period, obtain
Letters of Credit to replace Letters of Credit that have expired or that have been drawn
upon and reimbursed.

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

-30-

 

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

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

     (iii) The L/C Issuer shall not be under any obligation to issue any Letter of Credit
if:

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

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

     (C) except as otherwise agreed by the Administrative Agent and the L/C Issuer,
such Letter of Credit is in an initial stated amount less than $100,000;

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

     (E) such Letter of Credit contains any provisions for automatic reinstatement
of the stated amount after any drawing thereunder; or

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

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

     (v) The L/C Issuer shall be under no obligation to amend any Letter of Credit if (A)
the L/C Issuer would have no obligation at such time to issue such Letter of Credit

-31-

 

in its amended form under the terms hereof, or (B) the beneficiary of such Letter of
Credit does not accept the proposed amendment to such Letter of Credit.

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

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

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

     (ii) Promptly after receipt of any Letter of Credit Application, the L/C Issuer will
confirm with the Administrative Agent (by telephone or in writing) that the Administrative
Agent has received a copy of such Letter of Credit Application from the Borrower and, if
not, the L/C Issuer will provide the Administrative Agent with a copy thereof. Unless the
L/C Issuer has received written notice from any Lender, the Administrative Agent or any Loan
Party, at least one Business Day prior to the requested

-32-

 

date of issuance or amendment of the applicable Letter of Credit, that one or more
applicable conditions contained in Article IV shall not then be satisfied, then,
subject to the terms and conditions hereof, the L/C Issuer shall, on the requested date,
issue a Letter of Credit for the account of the Borrower (or the applicable Restricted
Subsidiary) or enter into the applicable amendment, as the case may be, in each case in
accordance with the L/C Issuer’s usual and customary business practices. Immediately upon
the issuance of each Letter of Credit, each Lender shall be deemed to, and hereby
irrevocably and unconditionally agrees to, purchase from the L/C Issuer a risk participation
in such Letter of Credit in an amount equal to the product of such Lender’s Applicable
Percentage times the amount of such Letter of Credit.

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

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

     (c) Drawings and Reimbursements; Funding of Participations.

     (i) Upon receipt from the beneficiary of any Letter of Credit of any notice of a
drawing under such Letter of Credit, the L/C Issuer shall notify the Borrower and the
Administrative Agent thereof. Not later than 12:00 noon on the date of any payment by the
L/C Issuer under a Letter of Credit (each such date, an “Honor Date”), the Borrower
shall reimburse the L/C Issuer through the Administrative Agent in an amount equal to

-33-

 

the amount of such drawing. If the Borrower fails to so reimburse the L/C Issuer by
such time, the Administrative Agent shall promptly notify each Lender of the Honor Date, the
amount of the unreimbursed drawing (the “Unreimbursed Amount”), and the amount of
such Lender’s Applicable Percentage thereof. In such event, the Borrower shall be deemed to
have requested a Committed Borrowing of Base Rate Loans to be disbursed on the Honor Date in
an amount equal to the Unreimbursed Amount, without regard to the minimum and multiples
specified in Section 2.02 for the principal amount of Base Rate Loans, but subject
to the amount of the unutilized portion of the Aggregate Commitments and the conditions set
forth in Section 4.02 (other than the delivery of a Committed Loan Notice). Any
notice given by the L/C Issuer or the Administrative Agent pursuant to this Section
2.03(c)(i) may be given by telephone if immediately confirmed in writing;
provided that the lack of such an immediate confirmation shall not affect the
conclusiveness or binding effect of such notice.

     (ii) Each Lender shall upon any notice pursuant to Section 2.03(c)(i) make
funds available to the Administrative Agent for the account of the L/C Issuer at the
Administrative Agent’s Office in an amount equal to its Applicable Percentage of the
Unreimbursed Amount not later than 2:00 p.m. on the Business Day specified in such notice by
the Administrative Agent, whereupon, subject to the provisions of Section
2.03(c)(iii), each Lender that so makes funds available shall be deemed to have made a
Base Rate Committed Loan to the Borrower in such amount. The Administrative Agent shall
remit the funds so received to the L/C Issuer.

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

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

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

-34-

 

Section 2.03(c) is subject to the conditions set forth in Section 4.02
(other than delivery by the Borrower of a Committed Loan Notice). No such making of an L/C
Advance shall relieve or otherwise impair the obligation of the Borrower to reimburse the
L/C Issuer for the amount of any payment made by the L/C Issuer under any Letter of Credit,
together with interest as provided herein.

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

     (d) Repayment of Participations.

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

     (ii) If any payment received by the Administrative Agent for the account of the L/C
Issuer pursuant to Section 2.03(c)(i) is required to be returned under any of the
circumstances described in Section 10.05 (including pursuant to any settlement
entered into by the L/C Issuer in its discretion), each Lender shall pay to the
Administrative Agent for the account of the L/C Issuer its Applicable Percentage thereof on
demand of the Administrative Agent, plus interest thereon from the date of such demand to
the date such amount is returned by such Lender, at a rate per annum equal to the Federal
Funds Rate from time to time in effect. The obligations of the Lenders under this clause
shall survive the payment in full of the Obligations and the termination of this Agreement.

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

-35-

 

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

     (ii) the existence of any claim, counterclaim, setoff, defense or other right that the
Borrower or any Restricted Subsidiary may have at any time against any beneficiary or any
transferee of such Letter of Credit (or any Person for whom any such beneficiary or any such
transferee may be acting), the L/C Issuer or any other Person, whether in connection with
this Agreement, the transactions contemplated hereby or by such Letter of Credit or any
agreement or instrument relating thereto, or any unrelated transaction;

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

     (iv) any payment by the L/C Issuer under such Letter of Credit against presentation of
a draft or certificate that does not strictly comply with the terms of such Letter of
Credit; or any payment made by the L/C Issuer under such Letter of Credit to any Person
purporting to be a trustee in bankruptcy, debtor-in-possession, assignee for the benefit of
creditors, liquidator, receiver or other representative of or successor to any beneficiary
or any transferee of such Letter of Credit, including any arising in connection with any
proceeding under any Debtor Relief Law; or

     (v) any other circumstance or happening whatsoever, whether or not similar to any of
the foregoing, including any other circumstance that might otherwise constitute a defense
available to, or a discharge of, the Borrower or any Restricted Subsidiary.

     The Borrower shall promptly examine a copy of each Letter of Credit and each amendment thereto
that is delivered to it and, in the event of any claim of noncompliance with the Borrower’s
instructions or other irregularity, the Borrower will immediately notify the L/C Issuer. The
Borrower shall be conclusively deemed to have waived any such claim against the L/C Issuer and its
correspondents unless such notice is given as aforesaid.

     (f) Role of L/C Issuer. Each Lender and the Borrower agree that, in paying any
drawing under a Letter of Credit, the L/C Issuer shall not have any responsibility to obtain any
document (other than any sight draft, certificates and documents expressly required by the Letter
of Credit) or to ascertain or inquire as to the validity or accuracy of any such document or the
authority of the Person executing or delivering any such document. None of the L/C Issuer, the
Administrative Agent, any of their respective Related Parties nor any correspondent, participant or
assignee of the L/C Issuer shall be liable to any Lender for (i) any action taken or omitted in
connection herewith at the request or with the approval of the Lenders or the Required Lenders, as
applicable; (ii) any action taken or omitted in the absence of gross negligence or willful
misconduct; or (iii) the due execution, effectiveness, validity or enforceability of any document
or instrument related to any Letter of Credit or Issuer Document. The Borrower hereby assumes all
risks of the acts or omissions of any beneficiary or transferee with respect to its use of any
Letter of Credit; provided, however, that this assumption is not intended to, and
shall not,

-36-

 

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

     (g) Cash Collateral. Upon the request of the Administrative Agent, (i) if the L/C
Issuer has honored any full or partial drawing request under any Letter of Credit and such drawing
has resulted in an L/C Borrowing, or (ii) if, as of the Letter of Credit Expiration Date, any L/C
Obligation for any reason remains outstanding, the Borrower shall, in each case, immediately Cash
Collateralize the then Outstanding Amount of all L/C Obligations. Sections 2.05 and
8.02(c) set forth certain additional requirements to deliver Cash Collateral hereunder.
For purposes of this Section 2.03, Section 2.05 and Section 8.02(c),
“Cash Collateralize” means to pledge and deposit with or deliver to the Administrative
Agent, for the benefit of the L/C Issuer and the Lenders, as collateral for the L/C Obligations,
cash or deposit account balances pursuant to documentation in form and substance reasonably
satisfactory to the Administrative Agent and the L/C Issuer (which documents are hereby consented
to by the Lenders). Derivatives of such term have corresponding meanings. The Borrower hereby
grants to the Administrative Agent, for the benefit of the L/C Issuer and the Lenders, a security
interest in all such cash, deposit accounts and all balances therein and all proceeds of the
foregoing. Cash Collateral shall be maintained in blocked, non-interest bearing deposit accounts
at Bank of America. Upon the drawing of any Letter of Credit for which funds are on deposit as
Cash Collateral, such funds shall be applied to reimburse the L/C Issuer in accordance with
Section 2.03(c)(i) and to pay any outstanding and accrued interest on such amounts. To the
extent that the amount of any Cash Collateral exceeds the then Outstanding Amount of L/C
Obligations and so long as no Default of the type specified in clauses (a), (f) or
(g) of Section 8.01 or Event of Default has occurred and is continuing, the excess
shall be refunded to the Borrower.

     (h) Applicability of ISP and UCP. Unless otherwise expressly agreed by the L/C
Issuer and the Borrower when a Letter of Credit is issued, (i) the rules of the ISP shall apply to
each standby Letter of Credit, and (ii) the rules of the Uniform Customs and Practice for
Documentary Credits, as most recently published by the International Chamber of Commerce at the
time of issuance, shall apply to each commercial Letter of Credit.

-37-

 

     (i) Letter of Credit Fees. The Borrower shall pay to the Administrative Agent for the
account of each Lender in accordance with its Applicable Percentage a Letter of Credit fee (the
“Letter of Credit Fee”) for each Letter of Credit equal to the Applicable Rate
times the daily amount available to be drawn under such Letter of Credit. For purposes of
computing the daily amount available to be drawn under any Letter of Credit, the amount of such
Letter of Credit shall be determined in accordance with Section 1.06. Letter of Credit
Fees shall be (i) due and payable on the first Business Day after the end of each March, June,
September and December, commencing with the first such date to occur after the issuance of such
Letter of Credit, on the Letter of Credit Expiration Date and thereafter on demand and (ii)
computed on a quarterly basis in arrears. If there is any change in the Applicable Rate during any
quarter, the daily amount available to be drawn under each Letter of Credit shall be computed and
multiplied by the Applicable Rate separately for each period during such quarter that such
Applicable Rate was in effect.

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

     (k) Conflict with Issuer Documents. In the event of any conflict between the terms
hereof and the terms of any Issuer Document, the terms hereof shall control.

     (l) Letters of Credit Issued for Subsidiaries. Notwithstanding that a Letter of
Credit issued or outstanding hereunder is in support of any obligations of, or is for the account
of, a Restricted Subsidiary, the Borrower shall be obligated to reimburse the L/C Issuer hereunder
for any and all drawings under such Letter of Credit. The Borrower hereby acknowledges that the
issuance of Letters of Credit for the account of Restricted Subsidiaries inures to the benefit of
the Borrower, and that the Borrower’s business derives substantial benefits from the businesses of
such Subsidiaries.

     2.04 Swing Line Loans.

     (a) The Swing Line. Subject to the terms and conditions set forth herein, the Swing
Line Lender agrees, in reliance upon the agreements of the other Lenders set forth in this
Section 2.04, to make loans (each such loan, a “Swing Line Loan”) to the Borrower
from time to time on any Business Day during the Availability Period in an aggregate amount not to
exceed at any

-38-

 

time outstanding the amount of the Swing Line Sublimit, notwithstanding the fact that such
Swing Line Loans, when aggregated with the Applicable Percentage of the Outstanding Amount of
Committed Loans and L/C Obligations of the Lender acting as Swing Line Lender, may exceed the
amount of such Lender’s Commitment; provided, however, that after giving effect to
any Swing Line Loan, (i) the Total Outstandings shall not exceed the Aggregate Commitments, and
(ii) the aggregate Outstanding Amount of the Committed Loans of any Lender, plus such
Lender’s Applicable Percentage of the Outstanding Amount of all L/C Obligations, plus such
Lender’s Applicable Percentage of the Outstanding Amount of all Swing Line Loans shall not exceed
such Lender’s Commitment, and provided, further, that the Borrower shall not use
the proceeds of any Swing Line Loan to refinance any outstanding Swing Line Loan. Within the
foregoing limits, and subject to the other terms and conditions hereof, the Borrower may borrow
under this Section 2.04, prepay under Section 2.05, and reborrow under this
Section 2.04. Each Swing Line Loan shall be a Base Rate Loan. Immediately upon the making
of a Swing Line Loan, each Lender shall be deemed to, and hereby irrevocably and unconditionally
agrees to, purchase from the Swing Line Lender a risk participation in such Swing Line Loan in an
amount equal to the product of such Lender’s Applicable Percentage times the amount of such
Swing Line Loan.

     (b) Borrowing Procedures. Each Swing Line Borrowing shall be made upon the Borrower’s
irrevocable notice to the Swing Line Lender and the Administrative Agent, which may be given by
telephone. Each such notice must be received by the Swing Line Lender and the Administrative Agent
not later than 1:00 p.m. on the requested borrowing date, and shall specify (i) the amount to be
borrowed, which shall be a minimum of $500,000 or a whole multiple of $100,000 in excess thereof,
and (ii) the requested borrowing date, which shall be a Business Day. Each such telephonic notice
must be confirmed promptly by delivery to the Swing Line Lender and the Administrative Agent of a
written Swing Line Loan Notice, appropriately completed and signed by a Responsible Officer of the
Borrower. Promptly after receipt by the Swing Line Lender of any telephonic Swing Line Loan
Notice, the Swing Line Lender will confirm with the Administrative Agent (by telephone or in
writing) that the Administrative Agent has also received such Swing Line Loan Notice and, if not,
the Swing Line Lender will notify the Administrative Agent (by telephone or in writing) of the
contents thereof. Unless the Swing Line Lender has received notice (by telephone or in writing)
from the Administrative Agent (including at the request of any Lender) prior to 2:00 p.m. on the
date of the proposed Swing Line Borrowing (A) directing the Swing Line Lender not to make such
Swing Line Loan as a result of the limitations set forth in the first proviso to the first sentence
of Section 2.04(a), or (B) that one or more of the applicable conditions specified in
Article IV is not then satisfied, then, subject to the terms and conditions hereof, the
Swing Line Lender will, not later than 3:00 p.m. on the borrowing date specified in such Swing Line
Loan Notice, make the amount of its Swing Line Loan available to the Borrower.

     (c) Refinancing of Swing Line Loans.

     (i) The Swing Line Lender at any time in its sole and absolute discretion may request,
on behalf of the Borrower (which hereby irrevocably authorizes the Swing Line Lender to so
request on its behalf), that each Lender make a Base Rate Committed Loan in an amount equal
to such Lender’s Applicable Percentage of the amount of Swing Line Loans then outstanding.
Such request shall be made in writing (which written request

-39-

 

shall be deemed to be a Committed Loan Notice for purposes hereof) and in accordance
with the requirements of Section 2.02, without regard to the minimum and multiples
specified therein for the principal amount of Base Rate Loans, but subject to the unutilized
portion of the Aggregate Commitments and the conditions set forth in Section 4.02.
The Swing Line Lender shall furnish the Borrower with a copy of the applicable Committed
Loan Notice promptly after delivering such notice to the Administrative Agent. Each Lender
shall make an amount equal to its Applicable Percentage of the amount specified in such
Committed Loan Notice available to the Administrative Agent in immediately available funds
for the account of the Swing Line Lender at the Administrative Agent’s Office not later than
1:00 p.m. on the day specified in such Committed Loan Notice, whereupon, subject to
Section 2.04(c)(ii), each Lender that so makes funds available shall be deemed to
have made a Base Rate Committed Loan to the Borrower in such amount. The Administrative
Agent shall remit the funds so received to the Swing Line Lender.

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

     (iii) If any Lender fails to make available to the Administrative Agent for the account
of the Swing Line Lender any amount required to be paid by such Lender pursuant to the
foregoing provisions of this Section 2.04(c) by the time specified in Section
2.04(c)(i), the Swing Line Lender shall be entitled to recover from such Lender (acting
through the Administrative Agent), on demand, such amount with interest thereon for the
period from the date such payment is required to the date on which such payment is
immediately available to the Swing Line Lender at a rate per annum equal to the greater of
the Federal Funds Rate and a rate determined by the Swing Line Lender in accordance with
banking industry rules on interbank compensation, plus any administrative, processing or
similar fees customarily charged by the Swing Line Lender in connection with the foregoing.
If such Lender pays such amount (with interest and fees as aforesaid), the amount so paid
shall constitute such Lender’s Committed Loan included in the relevant Committed Borrowing
or funded participation in the relevant Swing Line Loan, as the case may be. A certificate
of the Swing Line Lender submitted to any Lender (through the Administrative Agent) with
respect to any amounts owing under this clause (iii) shall be conclusive absent manifest
error.

     (iv) Each Lender’s obligation to make Committed Loans or to purchase and fund risk
participations in Swing Line Loans pursuant to this Section 2.04(c) shall be
absolute and unconditional and shall not be affected by any circumstance, including (A) any
setoff, counterclaim, recoupment, defense or other right which such Lender may have against
the Swing Line Lender, the Borrower or any other Person for any reason whatsoever, (B) the
occurrence or continuance of a Default, or (C) any other occurrence, event or condition,
whether or not similar to any of the foregoing; provided, however,

-40-

 

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

     (d) Repayment of Participations.

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

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

     (e) Interest for Account of Swing Line Lender. The Swing Line Lender shall be
responsible for invoicing the Borrower for interest on the Swing Line Loans. Until each Lender
funds its Base Rate Committed Loan or risk participation pursuant to this Section 2.04 to
refinance such Lender’s Applicable Percentage of any Swing Line Loan, interest in respect of such
Applicable Percentage shall be solely for the account of the Swing Line Lender.

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

     2.05 Prepayments.

     (a) The Borrower may, upon notice to the Administrative Agent, at any time or from time to
time voluntarily prepay Committed Loans in whole or in part without premium or penalty;
provided that (i) such notice must be received by the Administrative Agent not later than
12:00 noon (A) three Business Days prior to any date of prepayment of Eurodollar Rate Loans (or in
connection with the termination of the Aggregate Commitments pursuant to Section 2.06, such
later date as may be agreed to by the Administrative Agent) and (B) on the date of prepayment of
Base Rate Committed Loans; (ii) any prepayment of Eurodollar Rate Loans shall be in a principal
amount of $5,000,000 or a whole multiple of $1,000,000 in excess thereof; and (iii) any prepayment
of Base Rate Committed Loans shall be in a principal amount of $500,000 or a whole multiple of
$100,000 in excess thereof or, in each case, if less, the entire principal amount thereof then
outstanding. Each such notice shall specify the date and amount of such prepayment and the Type(s)
of Committed Loans to be prepaid and, if Eurodollar Rate Loans are to be prepaid, the Interest
Period(s) of such Loans. The Administrative Agent will promptly

-41-

 

notify each Lender of its receipt of each such notice, and of the amount of such Lender’s
Applicable Percentage of such prepayment. If such notice is given by the Borrower, the Borrower
shall make such prepayment and the payment amount specified in such notice shall be due and payable
on the date specified therein. Any prepayment of a Eurodollar Rate Loan shall be accompanied by
all accrued interest on the amount prepaid, together with any additional amounts required pursuant
to Section 3.05. Each such prepayment shall be applied to the Committed Loans of the
Lenders in accordance with their respective Applicable Percentages.

     (b) The Borrower may, upon notice to the Swing Line Lender (with a copy to the Administrative
Agent), at any time or from time to time, voluntarily prepay Swing Line Loans in whole or in part
without premium or penalty; provided that (i) such notice must be received by the Swing
Line Lender and the Administrative Agent not later than 1:00 p.m. on the date of the prepayment,
and (ii) any such prepayment shall be in a minimum principal amount of $100,000. Each such notice
shall specify the date and amount of such prepayment. If such notice is given by the Borrower, the
Borrower shall make such prepayment and the payment amount specified in such notice shall be due
and payable on the date specified therein.

     (c) If for any reason the Total Outstandings at any time exceed the Aggregate Commitments then
in effect, the Borrower shall immediately prepay Loans and/or Cash Collateralize the L/C
Obligations in an aggregate amount equal to such excess; provided, however, that
the Borrower shall not be required to Cash Collateralize the L/C Obligations pursuant to this
Section 2.05(c) unless after the prepayment in full of the Loans the Total Outstandings
exceed the Aggregate Commitments then in effect.

     2.06 Termination or Reduction of Commitments. The Borrower may, upon notice to the
Administrative Agent, terminate the Aggregate Commitments, or from time to time permanently reduce
the Aggregate Commitments; provided that (i) any such notice shall be received by the
Administrative Agent not later than 11:00 a.m. three Business Days prior to the date of termination
or reduction (or, in connection with the termination of the Aggregate Commitments, such later date
as may be agreed to by the Administrative Agent), (ii) any such partial reduction shall be in an
aggregate amount of $5,000,000 or any whole multiple of $1,000,000 in excess thereof, (iii) the
Borrower shall not terminate or reduce the Aggregate Commitments if, after giving effect thereto
and to any concurrent prepayments hereunder, the Total Outstandings would exceed the Aggregate
Commitments, and (iv) if, after giving effect to any reduction of the Aggregate Commitments, the
Letter of Credit Sublimit or the Swing Line Sublimit exceeds the amount of the Aggregate
Commitments, such Sublimit shall be automatically reduced by the amount of such excess. The
Administrative Agent will promptly notify the Lenders of any such notice of termination or
reduction of the Aggregate Commitments. Any reduction of the Aggregate Commitments shall be
applied to the Commitment of each Lender according to its Applicable Percentage. All fees accrued
until the effective date of any termination of the Aggregate Commitments shall be paid on the
effective date of such termination. Nothwithstanding anything in this Section 2.06 to the
contrary, a notice of termination of the Commitments delivered by the Borrower may state that such
notice is conditioned upon the effectiveness of other credit facilities, in which case such notice
may be revoked by the Borrower (by notice to the Administrative Agent on or prior to the specified
effective date) if such condition is not satisfied.

-42-

 

     2.07 Repayment of Loans.

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

     (b) The Borrower shall repay each Swing Line Loan on the earlier to occur of (i) the date ten
Business Days after such Loan is made and (ii) the Maturity Date.

     2.08 Interest.

     (a) Subject to the provisions of subsection (b) below, (i) each Eurodollar Rate Loan shall
bear interest on the outstanding principal amount thereof for each Interest Period at a rate per
annum equal to the Eurodollar Rate for such Interest Period plus the Applicable Rate; (ii)
each Base Rate Committed Loan shall bear interest on the outstanding principal amount thereof from
the applicable borrowing date at a rate per annum equal to the Base Rate plus the
Applicable Rate; and (iii) each Swing Line Loan shall bear interest on the outstanding principal
amount thereof from the applicable borrowing date at a rate per annum equal to the Base Rate
plus the Applicable Rate.

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

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

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

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

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

     (a) Commitment Fee. The Borrower shall pay to the Administrative Agent for the
account of each Lender in accordance with its Applicable Percentage, a commitment fee equal to the
Applicable Rate times the actual daily amount by which the Aggregate Commitments exceed the
sum of (i) the Outstanding Amount of Committed Loans and (ii) the Outstanding Amount of L/C
Obligations. The commitment fee shall accrue at all times during the Availability Period,

-43-

 

including at any time during which one or more of the conditions in Article IV is not
met, and shall be due and payable quarterly in arrears on the last Business Day of each March,
June, September and December, commencing with the first such date to occur after the Closing Date,
and on the last day of the Availability Period. The commitment fee shall be calculated quarterly
in arrears, and if there is any change in the Applicable Rate during any quarter, the actual daily
amount shall be computed and multiplied by the Applicable Rate separately for each period during
such quarter that such Applicable Rate was in effect.

     (b) Other Fees. (i) The Borrower shall pay to the Co-Arrangers and the Administrative
Agent for their own respective accounts fees in the amounts and at the times specified in the Fee
Letters. Such fees shall be fully earned when paid and shall not be refundable for any reason
whatsoever.

     (ii) The Borrower shall pay to the Lenders such fees as shall have been separately
agreed upon in writing in the amounts and at the times so specified. Such fees shall be
fully earned when paid and shall not be refundable for any reason whatsoever.

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

     (b) If, as a result of any restatement of or other adjustment to the financial statements of
the Borrower or for any other reason, the Borrower or the Lenders determine that (i) the
Consolidated Leverage Ratio as calculated by the Borrower as of any applicable date was inaccurate
and (ii) a proper calculation of the Consolidated Leverage Ratio would have resulted in higher
pricing for such period, the Borrower shall immediately and retroactively be obligated to pay to
the Administrative Agent for the account of the applicable Lenders, promptly on demand by the
Administrative Agent (or, after the occurrence of an actual or deemed entry of an order for relief
with respect to the Borrower under the Bankruptcy Code of the United States, automatically and
without further action by the Administrative Agent, any Lender or the L/C Issuer), an amount equal
to the excess of the amount of interest and fees that should have been paid for such period over
the amount of interest and fees actually paid for such period. This paragraph shall not limit the
rights of the Administrative Agent, any Lender or the L/C Issuer, as the case may be, under Section
2.03(c)(iii), 2.03(i) or 2.08(b) or under Article VIII. The
Borrower’s obligations under this paragraph shall survive the termination of the Aggregate
Commitments and the repayment of all other Obligations hereunder.

-44-

 

     2.11 Evidence of Debt.

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

     (b) In addition to the accounts and records referred to in subsection (a), each Lender and the
Administrative Agent shall maintain in accordance with its usual practice accounts or records
evidencing the purchases and sales by such Lender of participations in Letters of Credit and Swing
Line Loans. In the event of any conflict between the accounts and records maintained by the
Administrative Agent and the accounts and records of any Lender in respect of such matters, the
accounts and records of the Administrative Agent shall control in the absence of manifest error.

     2.12 Payments Generally; Administrative Agent’s Clawback.

     (a) General. All payments to be made by the Borrower shall be made without condition
or deduction for any counterclaim, defense, recoupment or setoff. Except as otherwise expressly
provided herein, all payments by the Borrower hereunder shall be made to the Administrative Agent,
for the account of the respective Lenders to which such payment is owed, at the Administrative
Agent’s Office in Dollars and in immediately available funds not later than 2:00 p.m. on the date
specified herein. The Administrative Agent will promptly distribute to each Lender its Applicable
Percentage (or other applicable share as provided herein) of such payment in like funds as received
by wire transfer to such Lender’s Lending Office. All payments received by the Administrative
Agent after 2:00 p.m. shall be deemed received on the next succeeding Business Day and any
applicable interest or fee shall continue to accrue. If any payment to be made by the Borrower
shall come due on a day other than a Business Day, payment shall be made on the next following
Business Day, and such extension of time shall be reflected in computing interest or fees, as the
case may be.

     (b) (i) Funding by Lenders; Presumption by Administrative Agent. Unless the
Administrative Agent shall have received notice from a Lender prior to the proposed date of any
Committed Borrowing of Eurodollar Rate Loans (or, in the case of any Committed Borrowing of Base
Rate Loans, prior to 1:00 p.m. on the date of such Committed Borrowing) that such Lender will not
make available to the Administrative Agent such Lender’s share of such Committed

-45-

 

Borrowing, the Administrative Agent may assume that such Lender has made such share available
on such date in accordance with Section 2.02 (or, in the case of a Committed Borrowing of
Base Rate Loans, that such Lender has made such share available in accordance with and at the time
required by Section 2.02) and may, in reliance upon such assumption, make available to the
Borrower a corresponding amount. In such event, if a Lender has not in fact made its share of the
applicable Committed Borrowing available to the Administrative Agent, then the applicable Lender
and the Borrower severally agree to pay to the Administrative Agent forthwith on demand such
corresponding amount in immediately available funds with interest thereon, for each day from and
including the date such amount is made available to the Borrower to but excluding the date of
payment to the Administrative Agent, at (A) in the case of a payment to be made by such Lender, the
greater of the Federal Funds Rate and a rate determined by the Administrative Agent in accordance
with banking industry rules on interbank compensation, plus any administrative, processing or
similar fees customarily charged by the Administrative Agent in connection with the foregoing, and
(B) in the case of a payment to be made by the Borrower, the interest rate applicable to Base Rate
Loans. If the Borrower and such Lender shall pay such interest to the Administrative Agent for the
same or an overlapping period, the Administrative Agent shall promptly remit to the Borrower the
amount of such interest paid by the Borrower for such period. If such Lender pays its share of the
applicable Committed Borrowing to the Administrative Agent, then the amount so paid shall
constitute such Lender’s Committed Loan included in such Committed Borrowing. Any payment by the
Borrower shall be without prejudice to any claim the Borrower may have against a Lender that shall
have failed to make such payment to the Administrative Agent.

     (ii) Payments by Borrower; Presumptions by Administrative Agent. Unless the
Administrative Agent shall have received notice from the Borrower prior to the date on which
any payment is due to the Administrative Agent for the account of the Lenders or the L/C
Issuer hereunder that the Borrower will not make such payment, the Administrative Agent may
assume that the Borrower has made such payment on such date in accordance herewith and may,
in reliance upon such assumption, distribute to the Lenders or the L/C Issuer, as the case
may be, the amount due. In such event, if the Borrower has not in fact made such payment,
then each of the Lenders or the L/C Issuer, as the case may be, severally agrees to repay to
the Administrative Agent forthwith on demand the amount so distributed to such Lender or the
L/C Issuer, in immediately available funds with interest thereon, for each day from and
including the date such amount is distributed to it to but excluding the date of payment to
the Administrative Agent, at the greater of the Federal Funds Rate and a rate determined by
the Administrative Agent in accordance with banking industry rules on interbank
compensation.

     A notice of the Administrative Agent to any Lender or the Borrower with respect to any amount
owing under this subsection (b) shall be prima facie evidence of the amount owing.

     (c) Failure to Satisfy Conditions Precedent. If any Lender makes available to the
Administrative Agent funds for any Loan to be made by such Lender as provided in the foregoing
provisions of this Article II, and such funds are not made available to the Borrower by the
Administrative Agent because the conditions to the applicable Credit Extension set forth in
Article IV are not satisfied or waived in accordance with the terms hereof, the
Administrative

-46-

 

Agent shall return such funds (in like funds as received from such Lender) to such Lender,
without interest.

     (d) Obligations of Lenders Several. The obligations of the Lenders hereunder to make
Committed Loans, to fund participations in Letters of Credit and Swing Line Loans and to make
payments pursuant to Section 10.04(c) are several and not joint. The failure of any Lender
to make any Committed Loan, to fund any such participation or to make any payment under Section
10.04(c) on any date required hereunder shall not relieve any other Lender of its corresponding
obligation to do so on such date, and no Lender shall be responsible for the failure of any other
Lender to so make its Committed Loan, to purchase its participation or to make its payment under
Section 10.04(c).

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

     2.13 Sharing of Payments by Lenders. If any Lender shall, by exercising any right of setoff
or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of
the Committed Loans made by it, or the participations in L/C Obligations or in Swing Line Loans
held by it resulting in such Lender’s receiving payment of a proportion of the aggregate amount of
such Committed Loans or participations and accrued interest thereon greater than its pro
rata share thereof as provided herein, then the Lender receiving such greater proportion
shall (a) notify the Administrative Agent of such fact, and (b) purchase (for cash at face value)
participations in the Committed Loans and subparticipations in L/C Obligations and Swing Line Loans
of the other Lenders, or make such other adjustments as shall be equitable, so that the benefit of
all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of
principal of and accrued interest on their respective Committed Loans and other amounts owing them,
provided that:

     (i) if any such participations or subparticipations are purchased and all or any
portion of the payment giving rise thereto is recovered, such participations or
subparticipations shall be rescinded and the purchase price restored to the extent of such
recovery, without interest; and

     (ii) the provisions of this Section shall not be construed to apply to (x) any payment
made by the Borrower pursuant to and in accordance with the express terms of this Agreement
or (y) any payment obtained by a Lender as consideration for the assignment of or sale of a
participation in any of its Committed Loans or subparticipations in L/C Obligations or Swing
Line Loans to any assignee or participant, other than to the Borrower or any Subsidiary
thereof (as to which the provisions of this Section shall apply).

     The Borrower consents to the foregoing and agrees, to the extent it may effectively do so
under applicable law, that any Lender acquiring a participation pursuant to the foregoing
arrangements may exercise against the Borrower rights of setoff and counterclaim with respect to

-47-

 

such participation as fully as if such Lender were a direct creditor of the Borrower in the
amount of such participation.

     2.14 Extension of Maturity Date.

     (a) Requests for Extension. The Borrower may, by notice to the Administrative Agent
(who shall promptly notify the Lenders) not less than 45 days and not more than 75 days prior to
any anniversary of the Closing Date (the “Applicable Anniversary Date”), request that each
Lender extend such Lender’s Maturity Date for an additional period of one year.

     (b) Lender Elections to Extend. Each Lender, acting in its sole and individual
discretion, shall, by notice to the Administrative Agent given not earlier than 30 days prior to
the Applicable Anniversary Date and not later than the date (the “Notice Date”) that is 20
days prior to the Applicable Anniversary Date, advise the Administrative Agent whether or not such
Lender agrees to such extension (and each Lender that determines not to so extend its Maturity Date
(a “Non-Extending Lender”) shall notify the Administrative Agent of such fact promptly
after such determination (but in any event no later than the Notice Date) and any Lender that does
not so advise the Administrative Agent on or before the Notice Date shall be deemed to be a
Non-Extending Lender. The election of any Lender to agree to such extension shall not obligate any
other Lender to so agree.

     (c) Notification by Administrative Agent. The Administrative Agent shall notify the
Borrower of each Lender’s determination under this Section no later than the date 15 days prior to
the Applicable Anniversary Date (or, if such date is not a Business Day, on the next preceding
Business Day).

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

     (e) Minimum Extension Requirement. If (and only if) the total of the Commitments of
the Lenders that have agreed so to extend their Maturity Date (each, an “Extending Lender”)
and the additional Commitments of the Additional Commitment Lenders shall be more than 50% of the
aggregate amount of the Commitments in effect immediately prior to the Applicable Anniversary Date,
then, effective as of the Maturity Date in effect prior to giving effect to any such extension
under this Section (such Maturity Date being called the “Existing Maturity Date”), the
Maturity Date of each Extending Lender and of each Additional Commitment Lender shall be extended
to the date falling on the first anniversary of the Existing Maturity Date (except that, if such
date is not a Business Day, such Maturity Date as so extended shall be the next preceding Business
Day) and each Additional Commitment Lender shall thereupon become a “Lender” for all purposes of
this Agreement.

-48-

 

     (f) Conditions to Effectiveness of Extensions. As a condition precedent to such
extension, the Borrower shall deliver to the Administrative Agent a certificate of each Loan Party
dated as of the Applicable Anniversary Date (in sufficient copies for each Extending Lender and
each Additional Commitment Lender) signed by a Responsible Officer of such Loan Party (i)
certifying and attaching the resolutions adopted by such Loan Party approving or consenting to such
extension and (ii) in the case of the Borrower, certifying that, before and after giving effect to
such extension, (A) the representations and warranties contained in Article V and the other
Loan Documents are true and correct in all material respects on and as of the Applicable
Anniversary Date, except to the extent that such representations and warranties specifically refer
to an earlier date, in which case they are true and correct as of such earlier date, and except
that for purposes of this Section 2.14, the representations and warranties contained in
subsections (a) and (b) of Section 5.04 shall be deemed to refer to the most recent
statements furnished pursuant to subsections (a) and (b), respectively, of Section 6.01,
and (B) no Event of Default exists, including for the avoidance of doubt, an Event of Default
arising from the Borrower’s failure to be in compliance with Section 7.04(b). In addition,
on the Maturity Date of each Non-Extending Lender, the Borrower shall prepay any Committed Loans
outstanding on such date (and pay any additional amounts required pursuant to Section 3.05)
to the extent necessary to keep outstanding Committed Loans ratable with any revised Applicable
Percentages of the respective Lenders effective as of such date.

     (g) Conflicting Provisions. This Section shall supersede any provisions in
Section 2.13 or 10.01 to the contrary.

     2.15 Increase in Commitments.

     (a) Request for Increase. Provided no Event of Default has occurred and is
continuing, upon notice to the Administrative Agent (which shall promptly notify the Lenders), the
Borrower shall have the right, without the consent of the Lenders or prior approval of the
Administrative Agent, to effectuate from time to time an increase in the Aggregate Commitments by
sending a notice to the Administrative Agent requesting such increase; provided that no
Lender’s Commitment shall be increased without the consent of such Lender. (i) any such request
for an increase shall be in a minimum amount of $5,000,000, (ii) after giving effect to such
increase in the Aggregate Commitments, the Aggregate Commitments do not exceed $400,000,000, and
(iii) no Lender’s Commitment shall be increased without such Lender’s prior written consent. The
Borrower may elect to request increases in the commitments of certain of the existing Lenders, or
of each of the existing Lenders or, subject to the approval of the Administrative Agent, the L/C
Issuer and the Swing Line Lender (which approvals shall not be unreasonably withheld), of
additional Eligible Assignees as new Lenders. In the event that the Borrower elects to request
increases in the commitments of any or each of the existing Lenders, at the time of sending such
notice, the Borrower (in consultation with the Administrative Agent) shall specify the time period
within which each such Lender is requested to respond (which shall in no event be less than ten
Business Days from the date of delivery of such notice to the Lenders).

     (b) Lender Elections to Increase. In the event that the Borrower so elects to request
increases in the commitments of each of the existing Lenders, each Lender shall notify the
Administrative Agent within such time period whether or not it agrees to increase its

-49-

 

Commitment and, if so, whether by an amount equal to, greater than, or less than its
Applicable Percentage of such requested increase. Any Lender not responding within such time
period shall be deemed to have declined to increase its Commitment.

     (c) Notification by Administrative Agent; Additional Lenders. The Administrative
Agent shall notify the Borrower and each Lender of the Lenders’ responses to each request made
hereunder. To achieve the full amount of a requested increase and subject to the approval of the
Administrative Agent, the L/C Issuer and the Swing Line Lender (which approvals shall not be
unreasonably withheld), the Borrower may also invite additional Eligible Assignees to become
Lenders pursuant to a joinder agreement in form and substance satisfactory to the Administrative
Agent and its counsel.

     (d) Effective Date and Allocations. If the Aggregate Commitments are increased in
accordance with this Section, the Administrative Agent and the Borrower shall determine the
effective date (the “Increase Effective Date”) and the final allocation of such increase.
The Administrative Agent shall promptly notify the Borrower and the Lenders of the final allocation
of such increase and the Increase Effective Date.

     (e) Conditions to Effectiveness of Increase. As a condition precedent to such
increase, the Borrower shall deliver to the Administrative Agent a certificate of each Loan Party
dated as of the Increase Effective Date (in sufficient copies for each Lender) signed by a
Responsible Officer of such Loan Party (i) certifying and attaching the resolutions adopted by such
Loan Party approving or consenting to such increase, and (ii) in the case of the Borrower,
certifying that, before and after giving effect to such increase, (A) the representations and
warranties contained in Article V and the other Loan Documents are true and correct in all
material respects on and as of the Increase Effective Date, except to the extent that such
representations and warranties specifically refer to an earlier date, in which case they are true
and correct as of such earlier date, and except that for purposes of this Section 2.15, the
representations and warranties contained in subsections (a) and (b) of Section 5.04 shall
be deemed to refer to the most recent statements furnished pursuant to clauses (a) and (b),
respectively, of Section 6.01, and (B) no Event of Default has occurred and is continuing,
including for the avoidance of doubt, an Event of Default arising from the Borrower’s failure to be
in compliance with Section 7.04(b). The Borrower shall prepay any Committed Loans
outstanding on the Increase Effective Date (and pay any additional amounts required pursuant to
Section 3.05) to the extent necessary to keep the outstanding Committed Loans ratable with
any revised Applicable Percentages arising from any nonratable increase in the Commitments under
this Section.

     (f) Conflicting Provisions. This Section shall supersede any provisions in
Section 2.13 or 10.01 to the contrary.

-50-

 

ARTICLE III.

TAXES, YIELD PROTECTION AND ILLEGALITY

     3.01 Taxes.

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

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

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

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

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

-51-

 

     Without limiting the generality of the foregoing, in the event that the Borrower is resident
for tax purposes in the United States, any Foreign Lender shall deliver to the Borrower and the
Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior
to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to
time thereafter upon the request of the Borrower or the Administrative Agent, but only if such
Foreign Lender is legally entitled to do so), whichever of the following is applicable:

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

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

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

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

     (f) Treatment of Certain Refunds. Upon the Borrower’s written request, the
Administrative Agent, L/C Issuer and each Lender shall use reasonable efforts to make any filings
necessary to obtain any refund, deduction or credit of any Taxes or Other Taxes as to which the
Borrower has indemnified it or with respect to which the Borrower has paid additional amounts
pursuant to this Section 3.01. If the Administrative Agent, any Lender or the L/C Issuer
determines, in its sole discretion, that it has received a material refund of any Taxes or Other
Taxes as to which it has been indemnified by the Borrower or with respect to which the Borrower has
paid additional amounts pursuant to this Section, it shall pay to the Borrower an amount equal to
such refund (but only to the extent of indemnity payments made, or additional amounts paid, by the
Borrower under this Section with respect to the Taxes or Other Taxes giving rise to such refund),
net of all reasonable out-of-pocket expenses of the Administrative Agent, such Lender or the L/C
Issuer, as the case may be, and without interest (other than any interest paid by the relevant
Governmental Authority with respect to such refund), provided that the Borrower, upon the
request of the Administrative Agent, such Lender or the L/C Issuer, agrees to repay the amount paid
over to the Borrower (plus any penalties, interest or other charges imposed by the relevant
Governmental Authority) to the Administrative Agent, such Lender or the L/C Issuer in the event the
Administrative Agent, such Lender or the L/C Issuer is required to repay such refund to such
Governmental Authority. This subsection shall not be construed to require the Administrative
Agent, any Lender or the L/C Issuer to make available its tax returns (or any other information
relating to its taxes that it deems confidential) to the Borrower or any other Person or to attempt
to take any position to obtain a refund, deduction, or

-52-

 

credit, which attempt would be inconsistent with any reporting position otherwise taken by the
Administrative Agent or such Lender or the L/C Issuer on its applicable tax returns.

     3.02 Illegality. If any Lender determines that any Law has made it unlawful, or that any
Governmental Authority has asserted that it is unlawful, for any Lender or its applicable Lending
Office to make, maintain or fund Eurodollar Rate Loans, or to determine or charge interest rates
based upon the Eurodollar Rate, or any Governmental Authority has imposed material restrictions on
the authority of such Lender to purchase or sell, or to take deposits of, Dollars in the London
interbank market, then, on notice thereof by such Lender to the Borrower through the Administrative
Agent, any obligation of such Lender to make or continue Eurodollar Rate Loans or to convert Base
Rate Committed Loans to Eurodollar Rate Loans shall be suspended until such Lender notifies the
Administrative Agent and the Borrower that the circumstances giving rise to such determination no
longer exist. Upon receipt of such notice, the Borrower shall, upon demand from such Lender (with
a copy to the Administrative Agent), prepay or, if applicable, convert all Eurodollar Rate Loans of
such Lender to Base Rate Loans, either on the last day of the Interest Period therefor, if such
Lender may lawfully continue to maintain such Eurodollar Rate Loans to such day, or immediately, if
such Lender may not lawfully continue to maintain such Eurodollar Rate Loans. Upon any such
prepayment or conversion, the Borrower shall also pay accrued interest on the amount so prepaid or
converted.

     3.03 Inability to Determine Rates. If the Required Lenders determine that for any reason in
connection with any request for a Eurodollar Rate Loan or a conversion to or continuation thereof
that (a) Dollar deposits are not being offered to banks in the London interbank eurodollar market
for the applicable amount and Interest Period of such Eurodollar Rate Loan, (b) adequate and
reasonable means do not exist for determining the Eurodollar Rate for any requested Interest Period
with respect to a proposed Eurodollar Rate Loan, or (c) the Eurodollar Rate for any requested
Interest Period with respect to a proposed Eurodollar Rate Loan does not adequately and fairly
reflect the cost to such Lenders of funding such Loan, the Administrative Agent will promptly so
notify the Borrower and each Lender. Thereafter, the obligation of the Lenders to make or maintain
Eurodollar Rate Loans shall be suspended until the Administrative Agent (upon the instruction of
the Required Lenders) revokes such notice. Upon receipt of such notice, the Borrower may revoke
any pending request for a Borrowing of, conversion to or continuation of Eurodollar Rate Loans or,
failing that, will be deemed to have converted such request into a request for a Committed
Borrowing of Base Rate Loans in the amount specified therein.

     3.04 Increased Costs; Reserves on Eurodollar Rate Loans.

     (a) Increased Costs Generally. If any Change in Law shall:

     (i) impose, modify or deem applicable any reserve, special deposit, compulsory loan,
insurance charge or similar requirement against assets of, deposits with or for the account
of, or credit extended or participated in by, any Lender (except any reserve requirement
contemplated by Section 3.04(e)) or the L/C Issuer;

     (ii) subject any Lender or the L/C Issuer to any tax of any kind whatsoever with
respect to this Agreement, any Letter of Credit, any participation in a Letter of

-53-

 

Credit or any Eurodollar Rate Loan made by it, or change the basis of taxation of
payments to such Lender or the L/C Issuer in respect thereof (except for Indemnified Taxes
or Other Taxes covered by Section 3.01 and the imposition of, or any change in the
rate of, any Excluded Tax payable by such Lender or the L/C Issuer); or

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

and the result of any of the foregoing shall be to increase the cost to such Lender of making or
maintaining any Eurodollar Rate Loan (or of maintaining its obligation to make any such Loan), or
to increase the cost to such Lender or the L/C Issuer of participating in, issuing or maintaining
any Letter of Credit (or of maintaining its obligation to participate in or to issue any Letter of
Credit), or to reduce the amount of any sum received or receivable by such Lender or the L/C Issuer
hereunder (whether of principal, interest or any other amount) then, upon delivery by such Lender
or the L/C Issuer of a certificate pursuant to Section 3.04(c), the Borrower will, pursuant
to Section 3.04(c), pay to such Lender or the L/C Issuer, as the case may be, such
additional amount or amounts as will compensate such Lender or the L/C Issuer, as the case may be,
for such additional costs incurred or reduction suffered.

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

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

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

-54-

 

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

     (e) Reserves on Eurodollar Rate Loans. The Borrower shall pay to each Lender, as long
as such Lender shall be required to maintain reserves with respect to liabilities or assets
consisting of or including Eurocurrency funds or deposits (currently known as “Eurocurrency
liabilities”), additional interest on the unpaid principal amount of each Eurodollar Rate Loan
equal to the actual costs of such reserves allocated to such Loan by such Lender (as determined by
such Lender in good faith, which determination shall be conclusive), which shall be due and payable
on each date on which interest is payable on such Loan, provided the Borrower shall have received
at least 10 days’ prior notice (with a copy to the Administrative Agent) of such additional
interest from such Lender. If a Lender fails to give notice 10 days prior to the relevant Interest
Payment Date, such additional interest shall be due and payable 10 days from receipt of such
notice.

     3.05 Compensation for Losses. Upon demand of any Lender (with a copy to the Administrative
Agent) from time to time, the Borrower shall promptly compensate such Lender for and hold such
Lender harmless from any loss, cost or expense incurred by it as a result of:

     (a) any continuation, conversion, payment or prepayment of any Loan other than a Base Rate
Loan on a day other than the last day of the Interest Period for such Loan (whether voluntary,
mandatory, automatic, by reason of acceleration, or otherwise);

     (b) any failure by the Borrower (for a reason other than the failure of such Lender to make a
Loan) to prepay, borrow, continue or convert any Loan other than a Base Rate Loan on the date or in
the amount notified by the Borrower; or

     (c) any assignment of a Eurodollar Rate Loan on a day other than the last day of the Interest
Period therefor as a result of a request by the Borrower pursuant to Section 10.13;

     including any loss of anticipated profits and any loss or expense arising from the liquidation or
reemployment of funds obtained by it to maintain such Loan or from fees payable to terminate the
deposits from which such funds were obtained. The Borrower shall also pay any customary
administrative fees charged by such Lender in connection with the foregoing.

     For purposes of calculating amounts payable by the Borrower to the Lenders under this Section
3.05, each Lender shall be deemed to have funded each Eurodollar Rate Loan made by it at the
Eurodollar Rate for such Loan by a matching deposit or other borrowing in the London interbank
eurodollar market for a comparable amount and for a comparable period, whether or not such
Eurodollar Rate Loan was in fact so funded.

-55-

 

     3.06 Mitigation Obligations; Replacement of Lenders.

     (a) Designation of a Different Lending Office. If any Lender requests compensation
under Section 3.04, or the Borrower is required to pay any additional amount to any Lender
or any Governmental Authority for the account of any Lender pursuant to Section 3.01, or if
any Lender gives a notice pursuant to Section 3.02, then such Lender shall use reasonable
efforts to designate a different Lending Office for funding or booking its Loans hereunder or to
assign its rights and obligations hereunder to another of its offices, branches or affiliates, if,
in the judgment of such Lender, such designation or assignment (i) would eliminate or reduce
amounts payable pursuant to Section 3.01 or 3.04, as the case may be, in the
future, or eliminate the need for the notice pursuant to Section 3.02, as applicable, and
(ii) in each case, would not subject such Lender to any unreimbursed cost or expense and would not
otherwise be disadvantageous to such Lender. The Borrower hereby agrees to pay all reasonable
costs and expenses incurred by any Lender in connection with any such designation or assignment.

     (b) Replacement of Lenders. If any Lender requests compensation under Section
3.04, or if the Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 3.01, or if any
Lender gives a notice pursuant to Section 3.02, the Borrower may replace such Lender in
accordance with Section 10.13.

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

ARTICLE IV.

CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

     4.01 Conditions of Initial Credit Extension. The obligation of the L/C Issuer and each Lender
to make its initial Credit Extension hereunder is subject to satisfaction (or waiver in accordance
with Section 10.02) of the following conditions precedent:

     (a) The Administrative Agent’s (or its counsel’s) receipt of the following, each of which
shall be originals or telecopies (followed promptly by originals) unless otherwise specified, each
properly executed by a Responsible Officer of the signing Loan Party, each dated the Closing Date
(or, in the case of certificates of governmental officials, a recent date before the Closing Date)
and each in form and substance reasonably satisfactory to the Administrative Agent and each of the
Lenders:

     (i) executed counterparts of this Agreement and the Guaranty, sufficient in number for
distribution to the Administrative Agent, each Lender and the Borrower;

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

     (iii) such certificates of resolutions or other action, incumbency certificates and/or
other certificates of Responsible Officers of each Loan Party as the Administrative Agent
may reasonably require evidencing the identity, authority and capacity of each Responsible
Officer thereof authorized to act as a Responsible Officer in connection with this Agreement
and the other Loan Documents to which such Loan Party is a party;

-56-

 

     (iv) such documents and certifications as the Administrative Agent or its counsel may
reasonably require relating to the organization, existence and good standing of each Loan
Party and the General Partner, the authorization of the Closing Transactions and any other
legal matters relating to the Borrower, each other Loan Party, the General Partner, this
Agreement or the Closing Transactions, all in form and substance reasonably satisfactory to
the Administrative Agent and its counsel;

     (v) favorable opinion of any general counsel, associate general counsel or corporate
secretary of the General Partner or a wholly owned subsidiary of Pioneer acting as counsel
for the Borrower, and of Thompson & Knight LLP, outside counsel for the Loan Parties,
addressed to the Administrative Agent and each Lender, covering those matters described in
Exhibit G and such other matters concerning the Loan Parties and the Loan Documents
as the Required Lenders may reasonably request;

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

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

     (viii) evidence that all insurance required to be maintained on behalf of and for the
benefit of the Loan Parties pursuant to the Loan Documents has been obtained and is in
effect;

     (ix) the Initial Reserve Report;

     (x) the Audited Financial Statements and Unaudited Financial Statements, accompanied by
a certificate of a Responsible Officer of the General Partner, on behalf of the Borrower,
setting forth a reasonably detailed calculation of the Consolidated Leverage Ratio as of the
Closing Date, after giving pro forma effect to the Closing Transactions, including any
Borrowing requested to be made hereunder as of such date;

     (xi) true, correct and complete copies of the Partnership Agreement and all Material
Contracts requested by the Administrative Agent; and

     (xii) a certificate dated as of the Closing Date substantially in the form of
Exhibit H hereto duly executed by the General Partner.

     (b) The Closing Transactions shall have occurred (or the Administrative Agent shall be
satisfied that such transactions will occur simultaneously with the Closing Date), substantially

-57-

 

as described in the Registration Statement and the Borrower shall have received no less than
$150,000,000, net of underwriting discounts and fees, in proceeds from the Equity Offering.

     (c) The Administrative Agent, Lenders and Co-Arrangers shall have received all fees and other
amounts due and payable on or prior to the Closing Date, including, to the extent invoiced prior to
or on the Closing Date, reimbursement or payment of all out-of-pocket expenses required to be
reimbursed or paid by the Borrower hereunder (including all such fees, charges and disbursements of
counsel to the Administrative Agent, paid directly to such counsel if requested by the
Administrative Agent).

     (d) The Closing Date shall have occurred on or before December 15, 2007.

     Without limiting the generality of the provisions of the last paragraph of Section
9.03, for purposes of determining compliance with the conditions specified in this Section
4.01, each Lender that has signed this Agreement shall be deemed to have consented to, approved
or accepted or to be satisfied with, each document or other matter required thereunder to be
consented to or approved by or acceptable or satisfactory to a Lender unless the Administrative
Agent shall have received notice from such Lender prior to the proposed Closing Date specifying its
objection thereto.

     4.02 Conditions to all Credit Extensions. The obligation of each Lender to honor any Request
for Credit Extension (other than a Committed Loan Notice requesting only a conversion of Committed
Loans to the other Type, or a continuation of Eurodollar Rate Loans) is subject to the following
conditions precedent:

     (a) The representations and warranties of the Borrower and each other Loan Party contained in
Article V or any other Loan Document, or which are contained in any document furnished at
any time under or in connection herewith or therewith, shall be true and correct in all material
respects on and as of the date of such Credit Extension, except to the extent that such
representations and warranties specifically refer to an earlier date, in which case they shall be
true and correct as of such earlier date, and except that for purposes of this Section
4.02, the representations and warranties contained in subsections (a) and (b) of Section
5.04 shall be deemed to refer to the most recent statements furnished pursuant to clauses (a)
and (b), respectively, of Section 6.01.

     (b) No Default shall have occurred and be continuing, or would result from such proposed
Credit Extension or from the application of the proceeds thereof (including, for the sake of
clarity, a Default arising from the Borrower’s failure to be in compliance with Section
7.04(b) as of the date of, and immediately after giving effect to, such Credit Extension).

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

     Each Request for Credit Extension (other than a Committed Loan Notice requesting only a
conversion of Committed Loans to the other Type or a continuation of Eurodollar Rate Loans)
submitted by the Borrower shall be deemed to be a representation and warranty that the

-58-

 

conditions specified in Sections 4.02(a) and (b) have been satisfied on and as
of the date of the applicable Credit Extension.

ARTICLE V.

REPRESENTATIONS AND WARRANTIES

     The Borrower represents and warrants to the Administrative Agent and the Lenders that as of
the Closing Date, each date specified in Sections 2.14, 2.15 and 4.02, and,
in the case of the representations and warranties set forth in Sections 5.01 and
5.02 solely with respect to the Borrower and this Agreement, as of the date hereof:

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

     5.02 Authorization; Enforceability. The Closing Transactions and the execution, delivery and
performance of each Loan Party of each Loan Document to which such Person is a Party are within
each Loan Party’s corporate, limited liability company or partnership powers and have been duly
authorized by all necessary corporate and, if required, stockholder, member or partnership action.
This Agreement and all Guaranties have been duly executed and delivered by the Loan Party, which is
a party thereto, and constitute a legal, valid and binding obligation of such Loan Party,
enforceable in accordance with their terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium or other laws affecting creditors’ rights generally and subject to
general principles of equity, regardless of whether considered in a proceeding in equity or at law.

     5.03 Governmental Approvals; No Conflicts. The Closing Transactions (a) do not violate the
charter, by-laws or other organizational documents of the Borrower or any of its Restricted
Subsidiaries or (b) except as to matters that could not reasonably be expected to result in a
Material Adverse Effect, (i) do not require any consent or approval of, registration or filing
with, or any other action by, any Governmental Authority or any other Person, except such as have
been obtained or made and are in full force and effect, (ii) will not violate any applicable law or
regulation or any order of any Governmental Authority, (iii) will not violate or result in a
default under any indenture, agreement or other instrument binding upon the Borrower or any of its
Restricted Subsidiaries or its assets, or give rise to a right thereunder to require any payment to
be made by the Borrower or any of its Restricted Subsidiaries, and (iv) will not result in the
creation or imposition of any Lien on any asset of the Borrower or any of its Restricted
Subsidiaries.

     5.04 Financial Statements; No Material Adverse Effect.

     (a) The Borrower has heretofore furnished to the Lenders true, correct and complete copies of
the Audited Financial Statements, as of and for the fiscal year ended December 31, 2006, reported
on by Ernst & Young LLP, independent public accountants. Such financial

-59-

 

statements present fairly, in all material respects, the financial position and results of
operations and cash flows of the predecessor to the Borrower and its Consolidated Subsidiaries on a
consolidated basis as of such dates and for such periods in accordance with GAAP consistently
applied throughout the period covered thereby, except as otherwise expressly noted therein.

     (b) The Unaudited Financial Statements present fairly, in all material respects, the financial
position and results of operations and cash flows of the Borrower and its Consolidated Subsidiaries
or the predecessor to the Borrower and its Consolidated Subsidiaries, as applicable, on a
consolidated basis as of such dates and for such periods in accordance with GAAP consistently
applied throughout the period covered thereby, subject to the absence of footnotes and to normal
year-end audit adjustments.

     (c) Since the date of the Audited Financial Statements, there has been no material adverse
change in the business, assets, properties, liabilities (actual or contingent), operations, or
financial condition of the Borrower and its Consolidated Subsidiaries, or the predecessor to the
Borrower and its Consolidated Subsidiaries, as applicable, taken as a whole.

     5.05 Properties. Each of the Borrower and its Restricted Subsidiaries has good title to, or
valid leasehold interests in, all its real and personal property material to its business, except
for any failure, defect or other matter that could not, in the aggregate, reasonably be expected to
have a Material Adverse Effect. Except for such acts or failures to act as could not be reasonably
expected to have a Material Adverse Effect, all of the material properties of the Borrower and its
Restricted Subsidiaries have been maintained, operated and developed in a good and workmanlike
manner in accordance with prudent industry standards and in conformity with all applicable Laws.
The property of the Borrower and its Restricted Subsidiaries is subject to no Liens, other than
Liens permitted by Section 7.02.

     5.06 Litigation and Environmental Matters.

          (a) There are no actions, suits or proceedings by or before any arbitrator or Governmental
Authority pending against or, to the knowledge of the Borrower, threatened in any court, in
arbitration or before any Governmental Authority, by or against or affecting the Borrower or any
of its Subsidiaries, taken as a whole, that could reasonably be expected, individually or in the
aggregate, to result in a Material Adverse Effect (other than the Disclosed Matters) or, as of the
Closing Date, that purport to affect or pertain to this Agreement or any other Loan Document or the
Closing Transactions.

          (b) Except for the Disclosed Matters and except with respect to any other matters that,
individually or in the aggregate, could not reasonably be expected to result in a Material Adverse
Effect, neither the Borrower nor any of its Subsidiaries (i) has failed to comply with any
Environmental Law or to obtain, maintain or comply with any permit, license or other approval
required under any Environmental Law, (ii) has become subject to any Environmental Liability, (iii)
has received notice of any claim with respect to any Environmental Liability or (iv) knows of any
basis for any Environmental Liability.

     5.07 Compliance with Laws; No Default. Each of the Borrower and its Restricted Subsidiaries
is in compliance with all laws, regulations and orders of any Governmental

-60-

 

Authority applicable to it or its property except where the failure to do so, individually or
in the aggregate, could not reasonably be expected to result in a Material Adverse Effect. Neither
the Borrower nor any Restricted Subsidiary is in breach or default in any material respect of its
obligations to the holders of the overriding royalty interests burdening the Oil and Gas Properties
pursuant to the Pioneer VPP Conveyance. No Default has occurred and is continuing, including for
the avoidance of doubt, a Default arising from the Borrower’s failure to be in compliance with
Section 7.04(b).

     5.08 Investment Company Status. Neither the Borrower nor any of its Subsidiaries is an
“investment company” as defined in, or subject to regulation under, the Investment Company Act of
1940.

     5.09 Taxes. Each of the Borrower and its Restricted Subsidiaries has timely filed or caused
to be filed all Tax returns and reports required to have been filed and has paid or caused to be
paid all Taxes required to have been paid by it, except (a) Taxes for which the Borrower or such
Restricted Subsidiary, as applicable, has set aside on its books adequate reserves including, Taxes
that are being contested in good faith by appropriate proceedings or (b) to the extent that the
failure to do so could not reasonably be expected to result in a Material Adverse Effect.

     5.10 ERISA. No ERISA Event has occurred or is reasonably expected to occur that, when taken
together with all other such ERISA Events for which liability is reasonably expected to occur,
could reasonably be expected to result in a Material Adverse Effect. The Borrower and each ERISA
Affiliate has fulfilled its obligations under the minimum funding standards of ERISA and the Code
with respect to each Plan and is in compliance in all material respects with the presently
applicable provisions of ERISA and the Code with respect to each Plan. Neither the Borrower nor
any ERISA Affiliate has (a) sought a waiver of the minimum funding standard under Section 412 of
the Code in respect of any Plan, (b) failed to make any contribution or payment to any Plan or
Multiemployer Plan, or made any amendment to any Plan that has resulted or could result in the
imposition of a Lien or the posting of a bond or other security under ERISA or the Code, or (c)
incurred any liability under Title IV of ERISA other than a liability to the PBGC for premiums
under Section 4007 of ERISA that are not past due.

     5.11 Disclosure. The information furnished by or on behalf of the Borrower to the
Administrative Agent or any Lender in connection with the negotiation of this Agreement or
delivered hereunder (as modified or supplemented by other information so furnished), taken as a
whole, contains no material misstatement of fact nor omits to state any material fact necessary to
make the statements therein, in the light of the circumstances under which they were made, not
materially misleading; provided that, with respect to projected financial information, the Borrower
represents only that such information was prepared in good faith based upon assumptions believed to
be reasonable at the time.

     5.12 Subsidiaries; Equity Interests. As of the Closing Date and at the time that any
financial statements are delivered pursuant to Section 6.01(a) or (b), the Borrower
has no Subsidiaries, including Unrestricted Subsidiaries, other than those specifically disclosed
in Part (a) of Schedule 5.12 or in writing on or prior to the date such financial
statements are delivered pursuant to Section 6.01(a) or (b), and all of the
outstanding common Equity Interests in such Subsidiaries have been validly issued, are fully paid
and nonassessable and are owned by a Loan

-61-

 

Party in the amounts specified on Part (a) of Schedule 5.12 or in such writings free
and clear of all Liens. As of the Closing Date and at the time that any financial statements are
delivered pursuant to Section 6.01(a) or (b), the Borrower has no equity
investments in any other corporation or entity, other than those specifically disclosed in Part (b)
of Schedule 5.12 or in writing on or prior to the date such financial statements are
delivered pursuant to Section 6.01(a) or (b). All of the outstanding common Equity
Interests in the Borrower have been validly issued and are fully paid and nonassessable.

     5.13 Insurance. The properties of the Borrower and its Restricted Subsidiaries are insured
with financially sound and reputable insurance companies who are not Affiliates of the Borrower, in
such amounts, with such deductibles and covering such risks as are customarily carried by companies
engaged in similar businesses and owning similar properties in localities where the Borrower or the
applicable Subsidiary operates.

     5.14 Gas Imbalances, Prepayments. As of the Closing Date and at the time that each Reserve
Report is delivered pursuant to Section 6.02(d), except as set forth in Schedule
5.14 or as disclosed in writing to the Administrative Agent on or prior to the date such
Reserve Report is delivered, on a net basis there are no gas imbalance, take or pay or other
prepayments which would require the Borrower or any of its Restricted Subsidiaries to deliver, in
the aggregate, five percent (5%) or more of the monthly production from Hydrocarbons produced from
the Oil and Gas Properties at some future time without then or thereafter receiving full payment
therefor.

     5.15 Marketing of Production. As of the Closing Date and at the time that each Reserve Report
is delivered pursuant to Section 6.02(d), except for the contracts set forth in
Schedule 5.15 or as disclosed in writing to the Administrative Agent on or prior to the
date such Reserve Report is delivered, no material agreements exist (other than Swap Contracts
permitted under Section 7.06) which are not cancelable on 60 days notice or less without
penalty or detriment for the sale of production from the Borrower’s or its Restricted Subsidiaries’
Hydrocarbons (including, without limitation, calls on or other rights to purchase production,
whether or not the same are currently being exercised) that (a) pertain to the sale of production
at a fixed price and (b) have a maturity or expiry date of more than twelve months.

     5.16 Swap Contracts. As of the Closing Date, Schedule 5.16 sets forth true and
complete information summarizing the notional volumes, prices and terms of all hedging arrangements
of the Borrower and each of its Restricted Subsidiaries and all credit support relating thereto
(including any margin required or supplied).

     5.17 Solvency. After giving effect to the Closing Transactions, (a) the aggregate assets
(after giving effect to amounts that could reasonably be received by reason of indemnity, offset,
insurance or any similar arrangement), at a fair valuation, of the Borrower and its Restricted
Subsidiaries, taken as a whole will exceed the aggregate Debt of the Borrower and its Restricted
Subsidiaries on a consolidated basis, as the Debt becomes absolute and matures, (b) each of the
Borrower and its Restricted Subsidiaries will not have incurred or intended to incur Debt beyond
its ability to pay such Debt (after taking into account the timing and amounts of cash to be
received by each of the Borrower and its Restricted Subsidiaries and the amounts to be payable on
or in respect of its 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

-62-

 

absolute and matures and (c) each of the Borrower and its Restricted Subsidiaries will not
have (and will have no reason to believe that it will have thereafter) unreasonably small capital
for the conduct of its business.

     5.18 Taxpayer Identification Number. The Borrower’s true and correct U.S. taxpayer
identification number is set forth on Schedule 10.02.

ARTICLE VI.

AFFIRMATIVE COVENANTS

     So long as any Lender shall have any Commitment hereunder, any Loan or other Obligation
hereunder shall remain unpaid or unsatisfied, or any Letter of Credit shall remain outstanding, the
Borrower covenants and agrees with the Lenders that:

     6.01 Financial Statements. The Borrower will deliver to the Administrative Agent and each
Lender:

     (a) within 90 days after the end of each fiscal year of the Borrower, its audited Consolidated
balance sheet and related statements of operations, unitholders’ equity and cash flows as of the
end of and for such year, setting forth in each case in comparative form the figures for the
previous fiscal year, all reported on by independent public accountants of recognized national
standing (without a “going concern” or like qualification or exception) to the effect that such
Consolidated financial statements present fairly in all material respects the financial condition
and results of operations of the Borrower and its Consolidated Subsidiaries on a consolidated basis
in accordance with GAAP consistently applied;

     (b) within 45 days after the end of each of the first three fiscal quarters of each fiscal
year of the Borrower, its Consolidated balance sheet and related statements of operations,
unitholders’ equity and cash flows as of the end of and for such fiscal quarter and the then
elapsed portion of the fiscal year, setting forth in each case in comparative form the figures for
the corresponding period or periods of (or, in the case of the balance sheet, as of the end of) the
previous fiscal year prepared on a basis consistent with that used on Form 10-Q as required by the
SEC, all certified by one of its Responsible Officers as presenting fairly in all material respects
the financial condition and results of operations of the Borrower and its Consolidated Subsidiaries
on a consolidated basis in accordance with GAAP consistently applied, subject to normal year-end
audit adjustments and the absence of footnotes;

     As to any information contained in materials furnished pursuant to Section 6.02(c),
the Borrower shall not be separately required to furnish such information under clause (a) or (b)
above, but the foregoing shall not be in derogation of the obligation of the Borrower to furnish
the information and materials described in clauses (a) and (b) above at the times specified
therein.

-63-

 

     6.02 Certificates; Other Information. The Borrower will deliver to the Administrative Agent
and each Lender, in form and detail reasonably satisfactory to the Administrative Agent and the
Required Lenders:

     (a) simultaneously with the delivery of the financial statements referred to in subsections
(a) or (b) of Section 6.01, a copy of the certification signed by the principal executive
officer and the principal financial officer of the General Partner (each, a “Certifying
Officer”) as required by Rule 13A-14 under the Securities Exchange Act of 1934 and a copy of
the internal controls disclosure statement by such Certifying Officers as required by Rule 13A-15
under the Securities Exchange Act of 1934 and Final Rules Release No. 33-8238 of the SEC, each as
included in the Borrower’s Annual Report on Form 10-K or Quarterly Report on Form 10-Q, for the
applicable fiscal period;

     (b) concurrently with any delivery of financial statements under subsections (a) or (b) of
Section 6.01, a Compliance Certificate of a Responsible Officer of the General Partner (i)
certifying as to whether a Default has occurred and, if a Default has occurred, specifying the
details thereof and any action taken or proposed to be taken with respect thereto, and (ii) setting
forth reasonably detailed calculations demonstrating compliance with Sections 7.04(a),
(b) and (c) as of the end of such fiscal quarter;

     (c) promptly after the same become publicly available, copies of all periodic and other
reports, proxy statements and other materials filed by, or required to be filed by, the Borrower or
any Subsidiary with the SEC, or any Governmental Authority succeeding to any or all of the
functions of the SEC, or with any national securities exchange, or distributed by the Borrower to
its unitholders generally, as the case may be;

     (d) by April 30 of each year, the Borrower shall furnish to the Administrative Agent and to
each Lender a Reserve Report and, if any Midstream Assets shall have been acquired by the Borrower
or any of its Restricted Subsidiaries, a Midstream Assets Report, which such reports shall be dated
as of the immediately preceding December 31 and shall set forth (i) in the case of the Reserve
Report, the Proved Reserves attributable to all or substantially all of the Oil and Gas Properties
then owned by the Borrower and its Restricted Subsidiaries and (ii) in the case of the Midstream
Assets Report, those items as contemplated in the definition of “Midstream Assets Report” for all
of the Midstream Assets then owned by the Borrower and its Restricted Subsidiaries, and in each
case, the PV attributable thereto;

     (e) promptly following any request therefor, such other information regarding the operations,
business affairs and financial condition of the Borrower or any Subsidiary, or compliance with the
terms of the Loan Documents, as the Administrative Agent or any Lender may reasonably request;

     (f) concurrently with any delivery of financial statements under subsections (a) or (b) of
Section 6.01, written notice of any changes in the Borrower’s hedging arrangements since
the date of the last such notice; and

     (g) concurrently with (i) any notice of designation of an Unrestricted Subsidiary or
Restricted Subsidiary delivered under Section 6.12 and (ii) the consummation by the
Borrower or

-64-

 

any Restricted Subsidiary of any Acquisition or series of related Acquisitions or any
Disposition or series of related Dispositions, in each case involving assets with a fair market
value in excess of the Threshold Amount, a PV to Consolidated Indebtedness Compliance Certificate
setting forth reasonably detailed calculations demonstrating compliance with Section
7.04(b) on such date after taking into effect such designation, Acquisition or Disposition.

     Documents required to be delivered pursuant to Section 6.01(a) or (b) or
Section 6.02(c) (to the extent any such documents are included in materials otherwise filed
with the SEC) may be delivered electronically and if so delivered, shall be deemed to have been
delivered on the date (i) on which the Borrower posts such documents, or provides a link thereto on
the Borrower’s website on the Internet at the website address listed on Schedule 10.02; or
(ii) on which such documents are posted on the 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: (i) the Borrower shall deliver paper copies of such documents to the Administrative Agent or
any Lender that requests the Borrower to deliver such paper copies until a written request to cease
delivering paper copies is given by the Administrative Agent or such Lender and (ii) the Borrower
shall notify the Administrative Agent and each Lender (by telecopier or electronic mail) of the
posting of any such documents and provide to the Administrative Agent by electronic mail electronic
versions (i.e., soft copies) of such documents. Notwithstanding anything contained herein,
in every instance the Borrower shall be required to provide paper copies of the Compliance
Certificates required by clauses (b) and (g) of Section 6.02 to the Administrative Agent.
Except for such Compliance Certificates, the Administrative Agent shall have no obligation to
request the delivery or to maintain copies of the documents referred to above, and in any event
shall have no responsibility to monitor compliance by the Borrower with any such request for
delivery, and each Lender shall be solely responsible for requesting delivery to it or maintaining
its copies of such documents.

     The Borrower hereby acknowledges that (a) the Administrative Agent and/or the Co-Arrangers
will make available to the Lenders and the L/C Issuer materials and/or information provided by or
on behalf of the Borrower hereunder (collectively, “Borrower Materials”) by posting the
Borrower Materials on IntraLinks 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 the 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. The Borrower hereby agrees
that (w) all Borrower Materials that are to be made available to Public Lenders shall be clearly
and conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word “PUBLIC” shall
appear prominently on the first page thereof; (x) by marking Borrower Materials “PUBLIC,” the
Borrower shall be deemed to have authorized the Administrative Agent, the Co-Arrangers, the L/C
Issuer and the Lenders to treat such Borrower Materials as not containing any material non-public
information with respect to the Borrower or its securities for purposes of United States Federal
and state securities laws (provided, however, that to the extent such Borrower
Materials constitute Information, they shall be treated as set forth in Section 10.07); (y)
all Borrower Materials marked “PUBLIC” are permitted to be made available through a portion of the
Platform designated “Public Investor;” and (z) the Administrative Agent and the

-65-

 

Co-Arranger shall be entitled to treat any Borrower Materials that are not marked “PUBLIC” as
being suitable only for posting on a portion of the Platform not designated “Public Investor.”

     6.03 Notices of Material Events. The Borrower will furnish to the Administrative Agent and
each Lender prompt written notice of the following:

     (a) the occurrence of any Default;

     (b) (i) the filing or commencement of any action, suit or proceeding by or before any
arbitrator or Governmental Authority against or affecting the Borrower or any Affiliate thereof or
(ii) the commencement of any litigation or proceeding affecting the Borrower or any Subsidiary,
including pursuant to any applicable Environmental Laws; in each case, that could reasonably be
expected to result in a Material Adverse Effect if adversely determined;

     (c) the occurrence of any ERISA Event that, alone or together with any other ERISA Events that
have occurred, could reasonably be expected to result in liability of the Borrower and its
Subsidiaries in an aggregate amount exceeding the Threshold Amount;

     (d) any material change in accounting policies or financial reporting practices by the
Borrower or any Subsidiary, including without limitation, any determination by the Borrower
referred to in Section 2.10(b); and

     (e) any other development that results in, or could reasonably be expected to result in, a
Material Adverse Effect.

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

     6.04 Existence; Conduct of Business. The Borrower will, and will cause each of its Restricted
Subsidiaries to, do or cause to be done all things necessary to preserve, renew and keep in full
force and effect its legal existence and the rights, licenses, permits, privileges and franchises
material to the conduct of its business except for any failure to maintain, preserve or qualify
that could not reasonably be expected to have a Material Adverse Effect; provided that the
foregoing shall not prohibit (i) any merger, consolidation, liquidation or dissolution permitted
under Section 7.03 or (ii) a termination of such existence, good standing, rights licenses,
permits, privileges and franchises of any Restricted Subsidiary if Borrower determines in good
faith that such termination is in the best interest of Borrower and could not reasonably be
expected to have a Material Adverse Effect.

     6.05 Payment of Obligations. The Borrower will, and will cause each of its Subsidiaries to
pay its obligations, including Tax liabilities, that, if not paid, could reasonably be expected to
result in a Material Adverse Effect before the same shall become delinquent or in default, except
where (a) the validity or amount thereof is being contested in good faith by

-66-

 

appropriate proceedings, and (b) the Borrower or such Subsidiary has set aside on its books
adequate reserves with respect thereto in accordance with GAAP.

     6.06 Maintenance of Properties; Insurance. The Borrower will, and will cause each of its
Restricted Subsidiaries to (a) keep and maintain all property, material to the conduct of its
business, in good working order and condition, ordinary wear and tear excepted, except for any
failure that could reasonably be expected to result in a Material Adverse Effect, (b) to operate,
develop and maintain its Oil and Gas Properties and facilities in accordance with prudent industry
standards and in conformity with all applicable Laws, and (c) maintain, with financially sound and
reputable insurance companies who are not Affiliates of the Borrower, insurance in such amounts,
with such deductibles and covering such risks as are customarily carried by companies engaged in
similar businesses and owning similar properties in localities where the Borrower or the applicable
Subsidiary operates.

     6.07 Books and Records; Inspection Rights. The Borrower will, and will cause each of its
Subsidiaries to, keep proper books of record and account in which full, true and correct entries
are made of all dealings and transactions in relation to its business and activities, as and to the
extent required in accordance with GAAP. The Borrower will, and will cause each of its Restricted
Subsidiaries to, permit any representatives designated by the Administrative Agent or any Lender,
upon reasonable prior 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, however, that when an Event of Default exists the Administrative Agent or
any Lender (or any of their respective representatives or independent contractors) may do any of
the foregoing at the expense of the Borrower at any time during normal business hours and without
advance notice.

     6.08 Compliance with Laws. The Borrower will, and will cause each of its Subsidiaries to,
comply with all Laws, rules, regulations and orders of any Governmental Authority applicable to it
or its property, except where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect.

     6.09 Use of Proceeds. The proceeds of the Credit Extensions will be used to consummate the
Closing Transactions and for general corporate purposes not in contravention of any Law or of any
Loan Document. No part of the proceeds of any Loan will be used, whether directly or indirectly,
for any purpose that entails a violation of any of the regulations issued by the FRB, including
Regulations T, U and X.

     6.10 Operations. The Borrower will cause the primary business of the Borrower and its
Restricted Subsidiaries, taken as a whole, to be the exploration, production, development and
operation of oil, natural gas and other liquid and gaseous Hydrocarbons and the gathering,
processing, transmission and marketing of Hydrocarbons and activities related or ancillary thereto,
including the Acquisition and operation of any Midstream Assets.

     6.11 Minimum Hedging. The Borrower and its Restricted Subsidiaries shall, (a) on or before
the date that is 45 days after Closing Date, have entered into, and at all times thereafter
maintain, Swap Contracts with Qualified Counterparties with respect to not less than 65% of

-67-

 

forecasted production attributable to Oil and Gas Properties constituting proved developed
producing (PDP) reserves described in the Initial Reserve Report for all periods through
December 31, 2010, (b) on or before April 1, 2009, have entered into, and at all times thereafter
maintain, Swap Contracts with Qualified Counterparties with respect to not less than 50% of
forecasted production attributable to Oil and Gas Properties constituting PDP reserves described in
the most recent Reserve Report for all periods through December 31, 2011, and (c) on or before
April 1, 2010, have entered into, and at all times thereafter maintain, Swap Contracts with
Qualified Counterparties with respect to not less than 50% of forecasted production attributable to
Oil and Gas Properties constituting PDP reserves described in the most recent Reserve Report at for
all periods through December 31, 2012.

     6.12 Additional Guarantors; Designation of Unrestricted Subsidiaries.

     (a) Unless designated as an Unrestricted Subsidiary in writing to the Administrative Agent
within 15 days after a Person becomes a Subsidiary of the Borrower or any of its Restricted
Subsidiaries, such Subsidiary shall be classified as a Restricted Subsidiary. The Borrower will
notify the Administrative Agent at the time that any Person becomes a Restricted Subsidiary
(including a newly formed or newly acquired Domestic Subsidiary not otherwise designated as an
Unrestricted Subsidiary), and promptly thereafter (and in any event within 45 days), cause such
Person to (i) become a Guarantor by executing and delivering to the Administrative Agent a
counterpart of the Guaranty or such other document as the Administrative Agent shall reasonably
deem appropriate for such purpose and (ii) deliver to the Administrative Agent documents of the
types referred to in clauses (iii) and (iv) of Section 4.01(a) and, if reasonably requested
by the Administrative Agent, favorable opinions of counsel to such Person (which shall cover, among
other things, the legality, validity, binding effect and enforceability of the documentation
referred to in sub-clause (i)), all in form, content and scope reasonably satisfactory to the
Administrative Agent.

     (b) A Responsible Officer may designate any Subsidiary of the Borrower (including any newly
acquired or newly formed Subsidiary of the Borrower and a Restricted Subsidiary but excluding any
Guarantor) other than Operating Company to be an Unrestricted Subsidiary unless such Subsidiary or
any of its Subsidiaries (i) owns any Equity Interests or Indebtedness of, or owns or holds any Lien
on any property of, the Borrower or any Restricted Subsidiary of the Borrower, (ii) owns any Proved
Reserves whose value was included in the calculation of PV set forth in the Compliance Certificate
or PV to Consolidated Indebtedness Compliance Certificate, as applicable, most recently delivered
to the Administrative Agent in accordance with clauses (b) or (g) of Section 6.02, or (iii)
has any Indebtedness other than Non-Recourse Debt. A Responsible Officer may designate any
Unrestricted Subsidiary to be a Restricted Subsidiary; provided, however, that (iv)
giving effect to such designation shall not result in the occurrence and continuance of a Default
and (v) any Indebtedness of such Subsidiary shall not be secured by Liens at the time of such
designation except for Liens permitted by Section 7.02. Any such designation by a
Responsible Officer shall be evidenced to the Administrative Agent by promptly filing with the
Administrative Agent a copy of the resolution of a Responsible Officer giving effect to such
designation and an officers’ certificate in form reasonably satisfactory to the Administrative
Agent to the effect that such designation complied with the foregoing provisions.

-68-

 

ARTICLE VII.

NEGATIVE COVENANTS

     So long as any Lender shall have any Commitment hereunder, any Loan or other Obligation
hereunder shall remain unpaid or unsatisfied, or any Letter of Credit shall remain outstanding, the
Borrower covenants and agrees with the Lenders that on and after the Closing Date:

     7.01 Indebtedness. The Borrower will not, and will not permit any Restricted Subsidiary to,
incur Indebtedness except for:

     (a) Indebtedness of Borrower and/or a Restricted Subsidiary in respect of letters of credit
that does not secure Indebtedness or obligations of an Unrestricted Subsidiary;

     (b) Indebtedness owed by the Borrower to a Restricted Subsidiary or by a Restricted Subsidiary
to the Borrower or to another Restricted Subsidiary;

     (c) Indebtedness of a Person that becomes, by acquisition or merger, a Restricted Subsidiary
which Indebtedness existed prior to the time of such acquisition or merger and was not incurred or
created in contemplation of such acquisition or merger;

     (d) Indebtedness under the Loan Documents;

     (e) Indebtedness secured by Liens permitted pursuant to Section 7.02, but only to the
extent of Indebtedness so permitted; and

     (f) other unsecured Indebtedness outstanding at such time for Borrower and all Restricted
Subsidiaries (but without duplication) in an aggregate amount not exceeding fifteen percent (15%)
of the Aggregate Commitments at such time.

     7.02 Liens. The Borrower will not, and will not permit any Restricted Subsidiary to, create,
incur, assume or permit to exist any Lien on any property or asset now owned or hereafter acquired
by it, or assign or sell any income or revenues (including accounts receivable) or rights in
respect of any thereof, except:

     (a) Permitted Encumbrances;

     (b) any Lien on any property or asset of the Borrower or any Restricted Subsidiary existing on
the Closing Date and set forth in Schedule 7.02; provided that (i) such Lien shall
not apply to any other property or asset of the Borrower or any Restricted Subsidiary and (ii) such
Lien shall secure only the Indebtedness and other obligations which it secures on the Closing Date
and extensions, renewals and replacements thereof that do not increase the outstanding principal
amount thereof;

     (c) any Lien on any property or asset existing prior to the acquisition thereof by the
Borrower or any Subsidiary or on any property or asset of any Person that becomes a Subsidiary
after the Closing Date existing prior to the time such Person becomes a Restricted Subsidiary;
provided that (i) such Lien is not created in contemplation of or in connection with such

-69-

 

acquisition or such Person becoming a Subsidiary, as the case may be, (ii) such Lien shall not
apply to any other property or assets of the Borrower or any Restricted Subsidiary, and (iv) such
Lien shall secure only the Indebtedness and other obligations which it secures on the date of such
acquisition or the date such Person becomes a Subsidiary, as the case may be and extensions,
renewals and replacements thereof that do not increase the outstanding principal amount thereof;

     (d) Liens created in connection with the acquisition, development, construction or improvement
by the Borrower or any Restricted Subsidiary of fixed or capital assets; provided that (i)
all Indebtedness secured by Liens permitted by this clause does not exceed $15,000,000 in the
aggregate outstanding at any time, (ii) such Liens and the Indebtedness secured thereby are
incurred prior to or within 180 days after such acquisition or the completion of such development,
construction or improvement, (iii) the Indebtedness secured thereby does not exceed 100% of the
cost of acquiring, developing, constructing or improving such fixed or capital assets and (iv) such
Liens shall not apply to any property or assets of the Borrower or any Restricted Subsidiary other
than such fixed or capital assets so acquired, developed, constructed or improved and other fixed
or capital assets that are developed or improved thereby or otherwise reasonably related thereto
(in the good faith determination of the Borrower) and working capital assets related thereto
(including but not limited to revenue from, and insurance, condemnation, sale and other proceeds
of, any such fixed or capital assets); and extensions, renewals and replacements thereof that do
not increase the outstanding principal amount thereof;

     (e) Liens securing obligations owing under this Agreement; and

     (f) Liens on deposits pursuant to any Swap Contract entered into by the Borrower or any
Restricted Subsidiary in the ordinary course of its business, not to exceed $5,000,000 in the
aggregate amount outstanding at any time; and

     (g) The volumetric production payments created under the Pioneer VPP Conveyance, but only to
the extent (i) of the assets burdened thereby on the Closing Date and (ii) that the benefits of any
indemnification payments by Pioneer Natural Resources USA, Inc. available to the Borrower and its
Restricted Subsidiaries with respect to the Pioneer VPP Conveyance pursuant to the Omnibus
Agreement are applicable to such volumetric production payments.

     7.03 Fundamental Changes.

     (a) The Borrower will not, and will not permit any Restricted Subsidiary to, merge into or
consolidate with any other Person, or permit any other Person to merge into or consolidate with it
or liquidate or dissolve, except that, if at the time thereof and immediately after giving effect
thereto no Default shall have occurred and be continuing, including, for the avoidance of doubt, a
Default arising from the Borrower’s failure to be in compliance with Section 7.04(b), (i)
any Person may merge into the Borrower in a transaction in which the surviving entity is the
Borrower or (ii) any Subsidiary may merge with any one or more other Subsidiaries or (iii) any
Subsidiary of the Borrower may merge or consolidate in connection with the consummation of any
Acquisition or Disposition that does not violate the other provisions of this Agreement or any
other Loan Document.

-70-

 

     (b) The Borrower will not sell, transfer, lease or otherwise Dispose of (in one transaction or
in a series of transactions) all or substantially all of its assets, or all or substantially all of
the equity interests of the Guarantors (in each case, whether now owned or hereafter acquired)
other than to another Guarantor. The Borrower will not permit any Restricted Subsidiary to sell,
transfer, lease or otherwise Dispose of (in one transaction or in a series of transactions) all or
substantially all of its assets, or all or substantially all of the equity interests of any
Guarantor (in each case, whether now owned or hereafter acquired) if the Borrower would be in
breach of any covenant set forth in Section 7.04 as a result of such Disposition.

     7.04 Financial Covenants.

     (a) The Borrower shall not permit the Consolidated Interest Coverage Ratio as of the last day
of any fiscal quarter of the Borrower to be less than 2.50 to 1.00.

     (b) The Borrower will not permit, as of any Determination Date, the ratio of PV to
Consolidated Indebtedness on such date to be less than 1.75 to 1.00.

     (c) The Borrower shall not permit the Consolidated Leverage Ratio as of the last day of any
fiscal quarter of the Borrower to be greater than 3.50 to 1.00; provided, that during an
Acquisition Period, the maximum Consolidated Leverage Ratio shall automatically be increased to
4.00 to 1.00. At the end of such Acquisition Period, the Consolidated Leverage Ratio will
automatically revert to 3.50 to 1.00 without any further action required to be taken by the
Administrative Agent, L/C Issuer, any Lender or Borrower. Notwithstanding anything to the contrary
contained herein, any failure by the Borrower to be in compliance with the requirements of this
clause (c) of Section 7.04 shall not (and may not) be remedied by a change in the
Consolidated Leverage Ratio upon election by the Borrower of an Acquisition Period.

     7.05 Investments, Loans, Advances and Guarantees.

     (a) The Borrower will not, and will not permit any of its Restricted Subsidiaries to, make any
loans or advances to, Guarantee any obligations of, or make any Investment or any other interest
in, any Unrestricted Subsidiaries except that the Borrower or any Restricted Subsidiaries may make
loans or advances to, or Investments or other interests in Unrestricted Subsidiaries in an
aggregate principal amount not to exceed $25,000,000 at any one time outstanding.

     (b) Except as permitted under Section 7.01(b)(iv), no Restricted Subsidiary shall
Guarantee Indebtedness of the Borrower unless it shall have previously or concurrently therewith
Guaranteed the obligations under the Loan Documents on at least an equal and ratable basis with
such Indebtedness of the Borrower, by execution and delivery of a Guaranty and other required
documents in accordance with Section 6.12(a).

     7.06 Swap Contracts. The Borrower will not, and will not permit any of its Restricted
Subsidiaries to, enter into any Swap Contract, except (a) Swap Contracts entered into to hedge or
mitigate risks to which the Borrower or any Restricted Subsidiary has actual or projected exposure
(other than those in respect of Equity Interests of the Borrower or any of its Subsidiaries) as
long as on any date, the aggregate notional volume corresponding to all

-71-

 

outstanding commodity forwards, swaps or collars or other similar hedging instruments from an
economic and risk profile, but excluding volumes corresponding to puts, floors and other
options that are purchased not in conjunction with any other Swap Contract, executed by the
Borrower and its Restricted Subsidiaries does not exceed 85% of reasonably forecasted production
(on an aggregate barrel of oil equivalent basis) attributable to Oil and Gas Properties and
Midstream Assets of the Borrower and its Restricted Subsidiaries (inclusive of those Oil and Gas
Properties and Midstream Assets to be acquired by the Borrower and its Restricted Subsidiaries
pursuant to executed purchase agreements) constituting Proved Reserves, (b) Swap Contracts entered
into in order to 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 the Borrower or any Restricted Subsidiary and (c) other Swap Contracts
permitted under the risk management policies approved by the General Partner’s Board of Directors
from time to time as long as such other Swap Contracts do not violate the limitations on Swap
Contracts set forth in clauses (a) and (b) of this Section 7.06 and are
entered into in the ordinary course of business for the purpose of directly mitigating risks
associated with liabilities, commitments, Investments, assets, or property held or reasonably
anticipated by the Borrower and its Subsidiaries, and not for purposes of speculation or taking a
“market view.”

     7.07 Transactions with Affiliates. The Borrower will not, and will not permit any of its
Restricted Subsidiaries to, sell, lease or otherwise transfer any property or assets to, or
purchase, lease or otherwise acquire any property or assets from, or otherwise engage in any other
transactions with, any of its Affiliates, except (a) the Closing Transactions, the Closing
Transaction Documents and the transactions contemplated by the Closing Transaction Documents, (b)
transactions in the ordinary course of business on customary terms, (c) any transaction (including
an Acquisition or Disposition) that is, or by operation of the Partnership Agreement is deemed to
be, fair and reasonable to the Borrower, (d) long-term incentive plans and similar compensatory
plans for officers, directors and employees of the General Partner, Pioneer or Pioneer’s
Subsidiaries and indemnification agreements and arrangements for the benefit of directors and
officers of the General Partner, Pioneer or Pioneer’s Subsidiaries, in each case, as approved or
adopted by the General Partner in compliance with the Partnership Agreement and (e) transactions
between or among the Borrower and its wholly-owned Restricted Subsidiaries not involving any other
Affiliate.

     7.08 Restrictive Agreements. The Borrower will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, enter into, incur or permit to exist any Contractual
Obligation (other than this Agreement or any other Loan Documents) that prohibits, restricts or
imposes any condition upon the ability of any Restricted Subsidiary to pay dividends or other
distributions with respect to any shares of its Equity Interests or to make or repay loans or
advances to the Borrower or any other Restricted Subsidiary or to Guarantee Indebtedness of the
Borrower or any other Restricted Subsidiary; provided that (i) the foregoing shall not
apply to restrictions and conditions imposed by law or by this Agreement, (ii) the foregoing shall
not apply to restrictions and conditions existing on the Closing Date identified on Schedule
7.08 (but shall apply to any extension or renewal of, or any amendment or modification
expanding the scope of, any such restriction or condition), (iii) the foregoing shall not apply to
customary restrictions and conditions contained in agreements relating to the sale of a Subsidiary
pending such sale, provided such restrictions and conditions apply only to the Subsidiary that is
to be sold

-72-

 

and such sale is permitted hereunder and (iv) the foregoing shall not apply to customary
restrictions or conditions existing in any agreement relating to Indebtedness of a Person that
becomes, by acquisition or merger, a Subsidiary of the Borrower or on acquired assets in effect at
the time such Person becomes a Subsidiary of the Borrower or such assets are acquired, so long as
such agreement was not entered into in contemplation of such Person becoming a Subsidiary of the
Borrower and such restrictions or conditions will not materially impair the ability of the Borrower
to pay its Indebtedness and other obligations hereunder.

     7.09 Restricted Payments. The Borrower will not, and will not permit any of its Restricted
Subsidiaries to, declare or make, directly or indirectly, any Restricted Payment, or incur any
obligation (contingent or otherwise) to do so, except that

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

     (b) the Borrower and each Subsidiary may declare and make dividend payments or other
distributions payable solely in the common Equity Interests of such Person; and

     (c) after consummation of the Equity Offering, so long as (i) no Event of Default shall have
occurred and be continuing at the time or would result therefrom, and (ii) the Borrower is in
compliance with Section 7.04 prior to and after giving effect thereto, the Borrower may
declare and make quarterly cash distributions to its partners in accordance with the Partnership
Agreement of “Available Cash” as such term is defined in the Partnership Agreement.

     7.10 Negative Pledge. The Borrower will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, enter into, incur or permit to exist any Contractual
Obligation (other than this Agreement, any other Loan Document, Swap Contracts and agreements
governing Indebtedness permitted under Section 7.01(f)) that requires the grant of a Lien to secure
an obligation of such Person if a Lien is granted to secure another obligation of such Person or
that limits the ability of the Borrower or any Restricted Subsidiary to create, incur, assume or
suffer to exist Liens on property of such Person; provided, however, that this Section shall not
prohibit any such Contractual Obligation incurred or provided in favor of any holder of any Lien
permitted under Section 7.02 solely to the extent any such Contractual Obligation relates
to the property encumbered by such Lien.

     7.11 Tax Status as Partnership; Organizational and Material Contracts. The Borrower shall not
alter its status as a partnership for purposes of United States Federal income taxes. The Borrower
shall not, and shall not permit any Restricted Subsidiary to, enter into or permit any amendment,
modification, or waiver of any provision or material right or obligation of any Person under, or
termination of (a) the Partnership Agreement or any other Organization Document other than as may
be required to consummate any transaction or activity not prohibited by the terms of this Agreement
and the other Loan Documents, including without limitation, the merger, consolidation, liquidation,
or dissolution of a Subsidiary not prohibited by

-73-

 

Section 7.03, or (b) any Material Contract, in each case, if such amendment,
modification, waiver or termination could reasonably be expected to have a Material Adverse Effect.

ARTICLE VIII.

EVENTS OF DEFAULT AND REMEDIES

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

     (a) Non-Payment. The Borrower or any other Loan Party shall fail to pay (i) any
amount of principal of any Loan or any L/C Obligation when and as the same shall become due and
payable, whether at due date thereof or at a date fixed for prepayment thereof or otherwise, or
(ii) any interest on any Loan or any fee or any other amount (other than an amount referred to in
sub-clause (i) of this clause (a)) payable under this Agreement, when and as the same shall become
due and payable, and such failure shall continue unremedied for a period of five days; or

     (b) Representations and Warranties. Any representation or warranty made or deemed
made by or on behalf of the Borrower or any other Loan Party in or in connection with this
Agreement, any Guaranty or other Loan Document, or any amendment or modification hereof or waiver
hereunder or thereunder, or in any report, certificate, financial statement or other document
furnished pursuant to or in connection with this Agreement, any Guaranty or other Loan Document, or
any amendment or modification hereof or thereof or any waiver hereof or thereof, shall prove to
have been incorrect in any material respect when made or deemed made and either (1) a Responsible
Officer of Borrower had actual knowledge that such representation or warranty was false or
incorrect in a material respect when made or (2) if no Responsible Officer had such knowledge, such
representation or warranty shall continue to be false or incorrect in any material respect thirty
(30) Business Days after the earlier of a Responsible Officer of Borrower obtaining actual
knowledge thereof or written notice thereof shall have been sent to Borrower by Administrative
Agent or by any Lender; or

     (c) Specific Covenants. The Borrower shall fail to observe or perform any covenant,
condition or agreement contained in Section 6.03, Section 6.04 (with respect to the
Borrower’s or any Guarantor’s existence), or Section 6.09 or in Article VII; or

     (d) Other Defaults. The Borrower or any other Loan Party shall fail to observe or
perform any covenant, condition or agreement contained in this Agreement or any Subsidiary Guaranty
or any other Loan Document (other than those specified in clause (a) or (c) of this Section
8.01), and such failure shall continue unremedied for a period of thirty days after notice
thereof from the Administrative Agent to the Borrower (which notice will be given at the request of
any Lender); or

     (e) Cross-Default. (i) The Borrower or any Restricted Subsidiary shall fail to make
any payment of principal or interest in respect of any Material Indebtedness (other than in respect
of any Swap Contract), when and as the same shall become due and payable and such failure continues
beyond any applicable period of grace provided therefor or any event or condition occurs that
results in any Material Indebtedness (including in respect of any Swap

-74-

 

Contract) becoming due and payable prior to its scheduled maturity or that enables or permits
the holder or holders of any Material Indebtedness (other than in respect of any Swap Contract) or
any trustee or agent on its or their behalf to cause such Material Indebtedness to become due and
payable, or to require the prepayment, repurchase, redemption or defeasance thereof, prior to its
scheduled maturity, and such event or condition continues beyond any applicable period of grace
provided therefor, provided that this clause (e) shall not apply to secured Indebtedness
that becomes due and payable as a result of the voluntary sale or transfer of the property or
assets securing such Indebtedness to the extent such Indebtedness is paid when due and payable; or
(ii) any event or condition occurs of the type customarily included as an event of default under
International Swap Dealers Association master agreements (with respect to which the Borrower or any
Restricted Subsidiary is the defaulting party) that results in the holder or holders of any
Material Indebtedness under a Swap Contract declaring an early termination date or such Material
Indebtedness otherwise becoming due and payable prior to its scheduled maturity; or

     (f) Insolvency Proceedings, Etc. (i) An involuntary proceeding shall be commenced or
an involuntary petition shall be filed seeking (A) liquidation, reorganization or other relief in
respect of the Borrower or any Restricted Subsidiary or its debts, or of a substantial part of its
assets, under any Debtor Relief Law now or hereafter in effect or (B) the appointment of a
receiver, trustee, custodian, sequestrator, conservator or similar official for the Borrower or any
Restricted Subsidiary or for a substantial part of its assets under any Debtor Relief Law relating
to any such Person, and, in any such case, such appointment, proceeding or petition shall continue
undischarged for 60 calendar days, or an order or decree approving or ordering any of the foregoing
shall be entered; or (ii) the Borrower or any Restricted Subsidiary shall (i) voluntarily commence
any proceeding or file any petition seeking liquidation, reorganization or other relief under any
Debtor Relief Law now or hereafter in effect, (ii) consent to the institution of, or fail to
contest in a timely and appropriate manner, any proceeding or petition described in sub-clause (i)
of this clause (f), (iii) apply for or consent to the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for the Borrower or any Restricted
Subsidiary or for a substantial part of its assets, (iv) file an answer admitting the material
allegations of a petition filed against it in any such proceeding, (v) make a general assignment
for the benefit of creditors or (vi) take any action for the purpose of effecting any of the
foregoing; or (ii) The Borrower or any Restricted Subsidiary institutes or consents to the
institution of any proceeding under any Debtor Relief Law, or makes an assignment for the benefit
of creditors; or applies for or consents to the appointment of any receiver, trustee, custodian,
conservator, liquidator, rehabilitator or similar officer for it or for all or any material part of
its property; or any receiver, trustee, custodian, conservator, liquidator, rehabilitator or
similar officer is appointed without the application or consent of such Person and the appointment
continues undischarged for 60 calendar days; or any proceeding under any Debtor Relief Law relating
to any such Person or to all or any material part of its property is instituted without the consent
of such Person and continues undismissed for 60 calendar days, or an order for relief is entered in
any such proceeding; or

     (g) Inability to Pay Debts; Attachment. (i) The Borrower or any Restricted Subsidiary
becomes unable, admit in writing its inability or fails generally to pay its debts as they become
due, or (ii) any writ or warrant of attachment or execution or similar process is

-75-

 

issued or levied against all or any material part of the property of any such Person and is
not released, vacated or fully bonded within 30 days after its issue or levy; or

     (h) Judgments. One or more judgments for the payment of money in an aggregate amount
in excess of the Threshold Amount shall be rendered against the Borrower, any Restricted Subsidiary
or any combination thereof and the same shall remain undischarged for a period of 30 consecutive
days during which execution shall not be effectively stayed, or any action shall be legally taken
by a judgment creditor to attach or levy upon any material domestic assets of the Borrower or any
Restricted Subsidiary to enforce any such judgment; or

     (i) ERISA. (i) An ERISA Event occurs with respect to a Pension Plan or Multiemployer
Plan which, in the opinion of the Required Lenders, when taken together with all other ERISA Events
that have occurred, has resulted or could reasonably be expected to result in a Material Adverse
Effect, or (ii) the Borrower or any ERISA Affiliate fails to pay when due, after the expiration of
any applicable grace period, any installment payment with respect to its withdrawal liability under
Section 4201 of ERISA under a Multiemployer Plan in an aggregate amount in excess of the Threshold
Amount; or

     (j) Invalidity of Loan Documents. Any Loan Document, at any time after its execution
and delivery and for any reason other than as expressly permitted hereunder or thereunder or
satisfaction in full of all the Obligations, ceases to be in full force and effect; or any Loan
Party or any other Person contests in any manner the validity or enforceability of any Loan
Document; or any Loan Party denies that it has any or further liability or obligation under any
Loan Document, or purports to revoke, terminate or rescind any Loan Document; or

     (k) Payment Default under Material Contracts. Pioneer or one of its Affiliates (other
than the Borrower and its Subsidiaries) shall fail to make a payment when due (after taking into
account any applicable grace period) to the Borrower or any other Loan Party (i) under the Omnibus
Agreement in an aggregate amount in excess of $10,000,000 or (ii) under any other Material Contract
in an aggregate amount in excess of the Threshold Amount and, in each case, such failure shall
continue unremedied for a period of 15 days.

     (l) Change of Control. A Change of Control shall occur.

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

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

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

-76-

 

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

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

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

ARTICLE IX.

ADMINISTRATIVE AGENT

     9.01 Appointment and Authority. Each of the Lenders and the L/C Issuer hereby irrevocably
appoints Bank of America to act on its behalf as the Administrative Agent hereunder and under the
other Loan Documents and authorizes the Administrative Agent to take such actions on its behalf and
to exercise such powers as are delegated to the Administrative Agent by the terms hereof or
thereof, together with such actions and powers as are reasonably incidental thereto. The
provisions of this Article are solely for the benefit of the Administrative Agent, the Lenders and
the L/C Issuer, and the Borrower shall not have rights as a third party beneficiary of any of such
provisions.

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

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

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

     (b) shall not have any duty to take any discretionary action or exercise any discretionary
powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan
Documents that the Administrative Agent is required to exercise as directed in

-77-

 

writing by the Required Lenders (or such other number or percentage of the Lenders as shall be
expressly provided for herein or in the other Loan Documents), provided that the
Administrative Agent shall not be required to take any action that, in its opinion or the opinion
of its counsel, may expose the Administrative Agent to liability or that is contrary to any Loan
Document or applicable law; and

     (c) shall not, except as expressly set forth herein and in the other Loan Documents, have any
duty to disclose, and shall not be liable for the failure to disclose, any information relating to
the Borrower or any of its Affiliates that is communicated to or obtained by the Person serving as
the Administrative Agent or any of its Affiliates in any capacity.

     The Administrative Agent shall not be liable for any action taken or not taken by it (i) with
the consent or at the request of the Required Lenders (or such other number or percentage of the
Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be
necessary, under the circumstances as provided in Sections 10.01 and 8.02) or (ii)
in the absence of its own gross negligence or willful misconduct. The Administrative Agent shall
be deemed not to have knowledge of any Default unless and until notice describing such Default is
given to the Administrative Agent by the Borrower, a Lender or the L/C Issuer.

     The Administrative Agent shall not be responsible for or have any duty to ascertain or inquire
into (i) any statement, warranty or representation made in or in connection with this Agreement or
any other Loan Document, (ii) the contents of any certificate, report or other document delivered
hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance
of any of the covenants, agreements or other terms or conditions set forth herein or therein or the
occurrence of any Default, (iv) the validity, enforceability, effectiveness or genuineness of this
Agreement, any other Loan Document or any other agreement, instrument or document or (v) the
satisfaction of any condition set forth in Article IV or elsewhere herein, other than to
confirm receipt of items expressly required to be delivered to the Administrative Agent.

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

-78-

 

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

     9.06 Resignation of Administrative Agent. The Administrative Agent may at any time give
notice of its resignation to the Lenders, the L/C Issuer and the Borrower. Upon receipt of any
such notice of resignation, the Required Lenders shall have the right, in consultation with the
Borrower, to appoint a successor, which shall be a bank with an office in the United States, or an
Affiliate of any such bank with an office in the United States. If no such successor shall have
been so appointed by the Required Lenders and shall have accepted such appointment within 30 days
after the retiring Administrative Agent gives notice of its resignation, then the retiring
Administrative Agent may on behalf of the Lenders and the L/C Issuer, appoint a successor
Administrative Agent meeting the qualifications set forth above; provided that if the
Administrative Agent shall notify the Borrower and the Lenders that no qualifying Person has
accepted such appointment, then such resignation shall nonetheless become effective in accordance
with such notice and (1) the retiring Administrative Agent shall be discharged from its duties and
obligations hereunder and under the other Loan Documents and (2) all payments, communications and
determinations provided to be made by, to or through the Administrative Agent shall instead be made
by or to each Lender and the L/C Issuer directly, until such time as the Required Lenders appoint a
successor Administrative Agent as provided for above in this Section. Upon the acceptance of a
successor’s appointment as Administrative Agent hereunder, such successor shall succeed to and
become vested with all of the rights, powers, privileges and duties of the retiring (or retired)
Administrative Agent, and the retiring Administrative Agent shall be discharged from all of its
duties and obligations hereunder or under the other Loan Documents (if not already discharged
therefrom as provided above in this Section). The fees payable by the Borrower to a successor
Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed
between the Borrower and such successor. After the retiring Administrative Agent’s resignation
hereunder and under the other Loan Documents, the provisions of this Article and
Section 10.04 shall continue in effect for the benefit of such retiring Administrative
Agent, its sub-agents and their respective Related Parties in respect of any actions taken or
omitted to be taken by any of them while the retiring Administrative Agent was acting as
Administrative Agent.

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

-79-

 

based upon this Agreement, any other Loan Document or any related agreement or any document
furnished hereunder or thereunder.

     9.08 No Other Duties, Etc. Anything herein to the contrary notwithstanding, none of the Joint
Bookrunners, Co-Arrangers, Syndication Agent or Documentation Agent listed on the cover page hereof
shall have any powers, duties or responsibilities under this Agreement or any of the other Loan
Documents, except in its capacity, as applicable, as the Administrative Agent, a Lender or the L/C
Issuer hereunder.

     9.09 Administrative Agent May File Proofs of Claim. In case of the pendency of any proceeding
under any Debtor Relief Law or any other judicial proceeding relative to any Loan Party, the
Administrative Agent (irrespective of whether the principal of any Loan or L/C Obligation shall
then be due and payable as herein expressed or by declaration or otherwise and irrespective of
whether the Administrative Agent shall have made any demand on the Borrower) shall be entitled and
empowered, by intervention in such proceeding or otherwise

     (a) to file and prove a claim for the whole amount of the principal and interest owing and
unpaid in respect of the Loans, L/C Obligations and all other Obligations that are owing and unpaid
and to file such other documents as may be necessary or advisable in order to have the claims of
the Lenders, the L/C Issuer and the Administrative Agent (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Lenders, the L/C Issuer and the
Administrative Agent and their respective agents and counsel and all other amounts due the Lenders,
the L/C Issuer and the Administrative Agent under Sections 2.03(i) and (j),
2.09 and 10.04) allowed in such judicial proceeding; and

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

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

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

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

-80-

 

Required Lenders will confirm in writing the Administrative Agent’s authority to release any
Guarantor from its obligations under the Guaranty pursuant to this Section 9.10.

ARTICLE X.

MISCELLANEOUS

     10.01 Amendments, Etc. No amendment or waiver of any provision of this Agreement or any other
Loan Document, and no consent to any departure by the Borrower or any other Loan Party therefrom,
shall be effective unless in writing signed by the Required Lenders and the Borrower or the
applicable Loan Party, as the case may be, and acknowledged by the Administrative Agent, and each
such waiver or consent shall be effective only in the specific instance and for the specific
purpose for which given; provided, however, that no such amendment, waiver or
consent shall:

     (a) extend or increase the Commitment of any Lender (or reinstate any Commitment terminated
pursuant to Section 8.02) without the written consent of such Lender;

     (b) postpone any date fixed by this Agreement or any other Loan Document for any payment of
principal, interest, fees or other amounts due to the Lenders (or any of them) hereunder or under
any other Loan Document without the written consent of each Lender directly affected thereby;

     (c) reduce the principal of, or the rate of interest specified herein on, any Loan or L/C
Borrowing, or (subject to clause (iv) of the second proviso to this Section 10.01) any fees
or other amounts payable hereunder or under any other Loan Document without the written consent of
each Lender directly affected thereby; provided, however, that only the consent of
the Required Lenders shall be necessary (i) to amend the definition of “Default Rate” or to waive
any obligation of the Borrower to pay interest or Letter of Credit Fees at the Default Rate or (ii)
to change the manner of computation of any financial ratio (including any change in any applicable
defined term) used in determining the Applicable Rate even if the effect of such amendment would be
to reduce the interest rate on any Loan or L/C Borrowing or to reduce any fee payable hereunder;

     (d) change Section 2.13 in a manner that would alter the pro rata sharing of payments
required thereby without the written consent of each Lender; or

     (e) change any provision of this Section or the definition of “Required Lenders” or any other
provision hereof specifying the number or percentage of Lenders required to amend, waive or
otherwise modify any rights hereunder or make any determination or grant any consent hereunder
without the written consent of each Lender; or

     (f) release all or substantially all of the value of the Guaranty without the written consent
of each Lender, except to the extent the release of any Guarantor is permitted pursuant to
Section 9.10 (in which case such release may be made by the Administrative Agent acting
alone);

-81-

 

and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the L/C Issuer in addition to the Lenders required above, affect the rights
or duties of the L/C Issuer under this Agreement or any Issuer Document relating to any Letter of
Credit issued or to be issued by it; (ii) no amendment, waiver or consent shall, unless in writing
and signed by the Swing Line Lender in addition to the Lenders required above, affect the rights or
duties of the Swing Line Lender under this Agreement; (iii) no amendment, waiver or consent shall,
unless in writing and signed by the Administrative Agent in addition to the Lenders required above,
affect the rights or duties of the Administrative Agent under this Agreement or any other Loan
Document; and (iv) the Fee Letters may be amended, or rights or privileges thereunder waived, in a
writing executed only by the parties thereto. Notwithstanding anything to the contrary herein, no
Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent
hereunder, except that the Commitment of such Lender may not be increased or extended without the
consent of such Lender.

     10.02 Notices; Effectiveness; Electronic Communication.

     (a) Notices Generally. Except in the case of notices and other communications
expressly permitted to be given by telephone (and except as provided in subsection (b) below), all
notices and other communications provided for herein shall be in writing and shall be delivered by
hand or overnight courier service, mailed by certified or registered mail or sent by telecopier as
follows, and all notices and other communications expressly permitted hereunder to be given by
telephone shall be made to the applicable telephone number, as follows:

     (i) if to the Borrower, the Administrative Agent, the L/C Issuer or the Swing Line
Lender, to the address, telecopier number, electronic mail address or telephone number
specified for such Person on Schedule 10.02; and

     (ii) if to any other Lender, to the address, telecopier number, electronic mail address
or telephone number specified in its Administrative Questionnaire.

Notices sent by hand or overnight courier service, or mailed by certified or registered
mail, shall be deemed to have been given when received; notices sent by telecopier shall be
deemed to have been given when sent (except that, if not given during normal business hours
for the recipient, shall be deemed to have been given at the opening of business on the next
business day for the recipient). Notices delivered through electronic communications to the
extent provided in subsection (b) below, shall be effective as provided in such subsection
(b).

     (b) Electronic Communications. Notices and other communications to the Lenders and
the L/C Issuer hereunder may be delivered or furnished by electronic communication (including
e-mail and Internet or intranet websites) pursuant to procedures approved by the Administrative
Agent, provided that the foregoing shall not apply to notices to any Lender or the L/C
Issuer pursuant to Article II if such Lender or the L/C Issuer, as applicable, has notified
the Administrative Agent that it is incapable of receiving notices under such Article by electronic
communication. The Administrative Agent or the Borrower may, in its discretion, agree to accept
notices and other communications to it hereunder by electronic communications pursuant

-82-

 

to procedures approved by it, provided that approval of such procedures may be limited
to particular notices or communications.

     Unless the Administrative Agent otherwise prescribes, (i) notices and other communications
sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement
from the intended recipient (such as by the “return receipt requested” function, as available,
return e-mail or other written acknowledgement), provided that if such notice or other
communication is not sent during the normal business hours of the recipient, such notice or
communication shall be deemed to have been sent at the opening of business on the next business day
for the recipient, and (ii) notices or communications posted to an Internet or intranet website
shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address as
described in the foregoing clause (i) of notification that such notice or communication is
available and identifying the website address therefor.

     (c) The Platform. THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE.” THE AGENT
PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE BORROWER MATERIALS OR
THE ADEQUACY OF THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS FROM THE
BORROWER MATERIALS. NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY
OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR
FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY ANY AGENT PARTY IN CONNECTION WITH THE
BORROWER MATERIALS OR THE PLATFORM. In no event shall the Administrative Agent or any of its
Related Parties (collectively, the “Agent Parties”) have any liability to the Borrower, any
Lender, the L/C Issuer or any other Person for losses, claims, damages, liabilities or expenses of
any kind (whether in tort, contract or otherwise) arising out of the Borrower’s or the
Administrative Agent’s transmission of Borrower Materials through the Internet, except to the
extent that such losses, claims, damages, liabilities or expenses are determined by a court of
competent jurisdiction by a final and nonappealable judgment to have resulted from the gross
negligence or willful misconduct of such Agent Party; provided, however, that in no
event shall any Agent Party have any liability to the Borrower, any Lender, the L/C Issuer or any
other Person for indirect, special, incidental, consequential or punitive damages (as opposed to
direct or actual damages).

     (d) Change of Address, Etc. Each of the Borrower, the Administrative Agent, the L/C
Issuer and the Swing Line Lender may change its address, telecopier or telephone number for notices
and other communications hereunder by notice to the other parties hereto. Each other Lender may
change its address, telecopier or telephone number for notices and other communications hereunder
by notice to the Borrower, the Administrative Agent, the L/C Issuer and the Swing Line 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,
telecopier 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

-83-

 

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 the Borrower or its securities for
purposes of United States Federal or state securities laws.

     (e) Reliance by Administrative Agent, L/C Issuer and Lenders. The Administrative
Agent, the L/C Issuer and the Lenders shall be entitled to rely and act upon any notices (including
telephonic Committed Loan Notices and Swing Line Loan Notices) purportedly given by or on behalf of
the Borrower even if (i) such notices were not made in a manner specified herein, were incomplete
or were not preceded or followed by any other form of notice specified herein, or (ii) the terms
thereof, as understood by the recipient, varied from any confirmation thereof. The Borrower shall
indemnify the Administrative Agent, the L/C Issuer, each Lender and the Related Parties of each of
them from all losses, costs, expenses and liabilities resulting from the reliance by such Person on
each notice purportedly given by or on behalf of the Borrower. All telephonic notices to and other
telephonic communications with the Administrative Agent may be recorded by the Administrative
Agent, and each of the parties hereto hereby consents to such recording.

     10.03 No Waiver; Cumulative Remedies. No failure by any Lender, the L/C Issuer or the
Administrative Agent to exercise, and no delay by any such Person in exercising, any right, remedy,
power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise
thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies,
powers and privileges herein provided are cumulative and not exclusive of any rights, remedies,
powers and privileges provided by law.

     10.04 Expenses; Indemnity; Damage Waiver.

     (a) Costs and Expenses. The Borrower shall pay (i) all reasonable documented
out-of-pocket expenses incurred by the Administrative Agent, the Co-Arrangers and their Affiliates
(including the reasonable documented fees, charges and disbursements of counsel for the
Administrative Agent), in connection with the syndication of the credit facilities provided for
herein, the preparation, negotiation, execution, delivery and administration of this Agreement and
the other Loan Documents or any amendments, modifications or waivers of the provisions hereof or
thereof (whether or not the transactions contemplated hereby or thereby shall be consummated),
(ii) all reasonable documented out-of-pocket expenses incurred by the L/C Issuer in connection with
the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment
thereunder and (iii) all reasonable documented out-of-pocket expenses incurred by the
Administrative Agent, any Lender or the L/C Issuer (including the fees, charges and disbursements
of any counsel for the Administrative Agent, any Lender or the L/C Issuer), in connection with the
enforcement or protection of its rights (A) in connection with this Agreement and the other Loan
Documents, including its rights under this Section, or (B) in connection with the Loans made or
Letters of Credit issued hereunder, including all such out-of-pocket expenses incurred during any
workout, restructuring or negotiations in respect of such Loans or Letters of Credit.

-84-

 

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

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

Section 2.12(d).

-85-

 

     (d) Waiver of Consequential Damages, Etc. To the fullest extent permitted by
applicable law, the Borrower shall not assert, and hereby waives, any claim against any Indemnitee,
on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to
direct or actual damages) arising out of, in connection with, or as a result of, this Agreement,
any other Loan Document or any agreement or instrument contemplated hereby, the transactions
contemplated hereby or thereby, any Loan or Letter of Credit or the use of the proceeds thereof.
No Indemnitee referred to in subsection (b) above shall be liable for any damages arising from the
use by unintended recipients of any information or other materials distributed to such unintended
recipients by such Indemnitee through telecommunications, electronic or other information
transmission systems in connection with this Agreement or the other Loan Documents or the
transactions contemplated hereby or thereby other than for direct or actual damages resulting from
the gross negligence or willful misconduct of such Indemnitee as determined by a final and
nonappealable judgment of a court of competent jurisdiction.

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

     (f) Survival. The agreements in this Section shall survive the resignation of the
Administrative Agent, the L/C Issuer and the Swing Line Lender, the replacement of any Lender, the
termination of the Aggregate Commitments and the repayment, satisfaction or discharge of all the
other Obligations.

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

     10.06 Successors and Assigns.

     (a) Successors and Assigns Generally. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective successors and
assigns permitted hereby, except that the Borrower may not assign or otherwise transfer any of its
rights or obligations hereunder without the prior written consent of the Administrative Agent and
each Lender and no Lender may assign or otherwise transfer any of its rights or obligations
hereunder except (i) to an assignee in accordance with the provisions of subsection (b) of this

-86-

 

Section, (ii) by way of participation in accordance with the provisions of subsection (d) of
this Section, or (iii) by way of pledge or assignment of a security interest subject to the
restrictions of subsection (f) of this Section (and any other attempted assignment or transfer by
any party hereto shall be null and void). Nothing in this Agreement, expressed or implied, shall
be construed to confer upon any Person (other than the parties hereto, their respective successors
and assigns permitted hereby, Participants to the extent provided in subsection (d) of this Section
and, to the extent expressly contemplated hereby, the Related Parties of each of the Administrative
Agent, the L/C Issuer and the Lenders) any legal or equitable right, remedy or claim under or by
reason of this Agreement.

     (b) Assignments by Lenders. Any Lender may at any time assign to one or more
assignees all or a portion of its rights and obligations under this Agreement (including all or a
portion of its Commitment and the Loans (including for purposes of this subsection (b),
participations in L/C Obligations and in Swing Line Loans) at the time owing to it);
provided that 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 Commitment and the Loans at the time owing to it or in the case
of an assignment to a Lender, an Affiliate of a Lender or an Approved Fund, no
minimum amount need be assigned; and

     (B) in any case not described in subsection (b)(i)(A) of this Section, the
aggregate amount of the Commitment (which for this purpose includes Loans
outstanding thereunder) or, if the Commitment is not then in effect, the principal
outstanding balance of the Loans of the assigning Lender subject to each such
assignment, determined as of the date the Assignment and Assumption with respect to
such assignment is delivered to the Administrative Agent or, if “Trade Date” is
specified in the Assignment and Assumption, as of the Trade Date, shall not be less
than $5,000,000 unless each of the Administrative Agent and, so long as no Event of
Default has occurred and is continuing, the Borrower otherwise consents (each such
consent not to be unreasonably withheld or delayed); provided,
however, that concurrent assignments to members of an Assignee Group and
concurrent assignments from members of an Assignee Group to a single Eligible
Assignee (or to an Eligible Assignee and members of its Assignee Group) will be
treated as a single assignment for purposes of determining whether such minimum
amount has been met.

     (ii) 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 Loans or the Commitment assigned, except that this
clause (ii) shall not apply to the Swing Line Lender’s rights and obligations in respect of
Swing Line Loans;

     (iii) Required Consents. No consent shall be required for any assignment
except to the extent required by subsection (b)(i)(B) of this Section and, in addition:

-87-

 

     (A) the consent of the Borrower (such consent not to be unreasonably withheld
or delayed) shall be required unless (1) an Event of Default has occurred and is
continuing at the time of such assignment or (2) such assignment is to a Lender, an
Affiliate of a Lender or an Approved Fund;

     (B) the consent of the Administrative Agent (such consent not to be
unreasonably withheld or delayed) shall be required if such assignment is to a
Person that is not a Lender, an Affiliate of such Lender or an Approved Fund with
respect to such Lender;

     (C) the consent of the L/C Issuer (such consent not to be unreasonably withheld
or delayed) shall be required for any assignment; and

     (D) the consent of the Swing Line Lender (such consent not to be unreasonably
withheld or delayed) shall be required for any assignment.

     (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 in the amount of $3,500; provided, however,
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 Borrower. No such assignment shall be made to the
Borrower or any of the Borrower’s Affiliates or Subsidiaries.

     (vi) No Assignment to Natural Persons. No such assignment shall be made to a
natural person.

Subject to acceptance and recording thereof by the Administrative Agent pursuant to subsection (c)
of this Section, from and after the effective date specified in each Assignment and Assumption, the
assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned
by such Assignment and Assumption, have the rights and obligations of a Lender under this
Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by
such Assignment and Assumption, be released from its obligations under this Agreement (and, in the
case of an Assignment and Assumption covering all of the assigning Lender’s rights and obligations
under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be
entitled to the benefits of Sections 3.01, 3.04, 3.05, and 10.04
with respect to facts and circumstances occurring prior to the effective date of such assignment.
Upon request, the Borrower (at its expense) shall execute and deliver a Note to the assignee
Lender. Any assignment or transfer by a Lender of rights or obligations under this Agreement that
does not comply with this subsection shall be treated for purposes of this Agreement as a sale by
such Lender of a participation in such rights and obligations in accordance with subsection (d) of
this Section.

     (c) Register. The Administrative Agent, acting solely for this purpose as an agent of
the Borrower, shall maintain at the Administrative Agent’s Office a copy of each Assignment

-88-

 

and Assumption delivered to it and a register for the recordation of the names and addresses
of the Lenders, and the Commitments of, and principal amounts of the Loans and L/C Obligations
owing to, each Lender pursuant to the terms hereof from time to time (the “Register”). The
entries in the Register shall be conclusive, and the Borrower, the Administrative Agent and the
Lenders may treat each Person whose name is recorded in the Register pursuant to the terms hereof
as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary.
The Register shall be available for inspection by the 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,
the Borrower or the Administrative Agent, sell participations to any Person (other than a natural
person or the Borrower or any of the Borrower’s Affiliates or Subsidiaries) (each, a
“Participant”) in all or a portion of such Lender’s rights and/or obligations under this
Agreement (including all or a portion of its Commitment and/or the Loans (including such Lender’s
participations in L/C Obligations and/or Swing Line Loans) owing to it); provided that
(i) such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall
remain solely responsible to the other parties hereto for the performance of such obligations and
(iii) the Borrower, the Administrative Agent, the Lenders and the L/C Issuer shall continue to deal
solely and directly with such Lender in connection with such Lender’s rights and obligations under
this Agreement.

     Any agreement or instrument pursuant to which a Lender sells such a participation shall
provide that such Lender shall retain the sole right to enforce this Agreement and to approve any
amendment, modification or waiver of any provision of this Agreement; provided that such
agreement or instrument may provide that such Lender will not, without the consent of the
Participant, agree to any amendment, waiver or other modification described in the first proviso to
Section 10.01 that affects such Participant. Subject to subsection (e) of this Section,
the Borrower agrees that each Participant shall be entitled to the benefits of Sections
3.01, 3.04 and 3.05 to the same extent as if it were a Lender and had acquired
its interest by assignment pursuant to subsection (b) of this Section. To the extent permitted by
law, each Participant also shall be entitled to the benefits of Section 10.08 as though it
were a Lender, provided such Participant agrees to be subject to Section 2.13 as
though it were a Lender.

     (e) Limitations upon Participant Rights. A Participant shall not be entitled to
receive any greater payment under Section 3.01 or 3.04 than the applicable Lender
would have been entitled to receive with respect to the participation sold to such Participant,
unless the sale of the participation to such Participant is made with the Borrower’s prior written
consent. A Participant that would be a Foreign Lender if it were a Lender shall not be entitled to
the benefits of Section 3.01 unless the Borrower is notified of the participation sold to
such Participant and such Participant agrees, for the benefit of the Borrower, to comply with
Section 3.01(e) as though it were a Lender.

     (f) Certain Pledges. Any Lender may at any time pledge or assign a security interest
in all or any portion of its rights under this Agreement (including under its Note, if any) to
secure obligations of such Lender, including any pledge or assignment to secure obligations to a
Federal Reserve Bank; provided that no such pledge or assignment shall release such Lender
from any of

-89-

 

its obligations hereunder or substitute any such pledgee or assignee for such Lender as a
party hereto.

     (g) Electronic Execution of Assignments. The words “execution,” “signed,”
“signature,” and words of like import in any Assignment and Assumption shall be deemed to include
electronic signatures or the keeping of records in electronic form, each of which shall be of the
same legal effect, validity or enforceability as a manually executed signature or the use of a
paper-based recordkeeping system, as the case may be, to the extent and as provided for in any
applicable law, including the Federal Electronic Signatures in Global and National Commerce Act,
the New York State Electronic Signatures and Records Act, or any other similar state laws based on
the Uniform Electronic Transactions Act.

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

     10.07 Treatment of Certain Information; Confidentiality. Each of the Administrative Agent,
the Lenders and the L/C Issuer agrees to maintain the confidentiality of the Information (as
defined below), except that Information may be disclosed (a) to its Affiliates and to its and its
Affiliates’ respective partners, directors, officers, employees, agents, advisors and
representatives (it being understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such Information and instructed to keep such Information
confidential), (b) to the extent requested by any regulatory authority purporting to have
jurisdiction over it (including any self-regulatory authority, such as the National Association of
Insurance Commissioners), (c) to the extent required by applicable laws or regulations or by any
subpoena or similar legal process, (d) to any other party hereto, (e) in

-90-

 

connection with the exercise of any remedies hereunder or under any other Loan Document or any
action or proceeding relating to this Agreement or any other Loan Document or the enforcement of
rights hereunder or thereunder, (f) subject to an agreement containing provisions substantially the
same as those of this Section, to (i) any assignee of or Participant in, or any prospective
assignee of or Participant in, any of its rights or obligations under this Agreement or any
Eligible Assignee invited to be a Lender pursuant to Section 2.15(c), (ii) any actual or
prospective counterparty (or its advisors) to any swap or derivative transaction relating to the
Borrower and its obligations, (iii) to its advisors (other than its accountants and legal counsel),
(iv) to an investor or prospective investor in an Approved Fund that also agrees that Information
shall be used solely for the purpose of evaluating an investment in such Approved Fund, (v) to a
trustee, collateral manager, servicer, backup servicer, noteholder or secured party in an Approved
Fund in connection with the administration, servicing and reporting on the assets serving as
collateral for an Approved Fund, or (vi) to a nationally recognized rating agency that requires
access to information regarding the Borrower, the Loans and Loan Documents in connection with
ratings issued with respect to an Approved Fund, (g) with the consent of the Borrower or (h) to the
extent such Information (x) becomes publicly available other than as a result of a breach of this
Section or (y) becomes available to the Administrative Agent, any Lender, the L/C Issuer or any of
their respective Affiliates on a nonconfidential basis from a source other than the Borrower.

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

     Each of the Administrative Agent, the Lenders and the L/C Issuer acknowledges that (a) the
Information may include material non-public information concerning the Borrower or a Subsidiary, as
the case may be, (b) it has developed compliance procedures regarding the use of material
non-public information and (c) it will handle such material non-public information in accordance
with applicable Law, including United States Federal and state securities Laws.

     10.08 Right of Setoff. If an Event of Default shall have occurred and be continuing, each
Lender, the L/C Issuer and each of their respective Affiliates is hereby authorized at any time and
from time to time, to the fullest extent permitted by applicable law, to set off and apply any and
all deposits (general or special, time or demand, provisional or final, in whatever currency) at
any time held and other obligations (in whatever currency) at any time owing by such Lender, the
L/C Issuer or any such Affiliate to or for the credit or the account of the Borrower against any
and all of the obligations of the Borrower now or hereafter existing under this Agreement or any
other Loan Document to such Lender or the L/C Issuer, irrespective of whether or not such Lender or
the L/C Issuer shall have made any demand under this Agreement or any other Loan Document and
although such obligations of the Borrower may be contingent

-91-

 

or unmatured or are owed to a branch or office of such Lender or the L/C Issuer different from
the branch or office holding such deposit or obligated on such indebtedness. The rights of each
Lender, the L/C Issuer and their respective Affiliates under this Section are in addition to other
rights and remedies (including other rights of setoff) that such Lender, the L/C Issuer or their
respective Affiliates may have. Each Lender and the L/C Issuer agrees to notify the Borrower and
the Administrative Agent promptly after any such setoff and application, provided that the
failure to give such notice shall not affect the validity of such setoff and application.

     10.09 Interest Rate Limitation. Notwithstanding anything to the contrary contained in any
Loan Document, the interest paid or agreed to be paid under the Loan Documents shall not exceed the
maximum rate of non-usurious interest permitted by applicable Law (the “Maximum Rate”). If
the Administrative Agent or any Lender shall receive interest in an amount that exceeds the Maximum
Rate, the excess interest shall be applied to the principal of the Loans or, if it exceeds such
unpaid principal, refunded to the Borrower. In determining whether the interest contracted for,
charged, or received by the Administrative Agent or a Lender exceeds the Maximum Rate, such Person
may, to the extent permitted by applicable Law, (a) characterize any payment that is not principal
as an expense, fee, or premium rather than interest, (b) exclude voluntary prepayments and the
effects thereof, and (c) amortize, prorate, allocate, and spread in equal or unequal parts the
total amount of interest throughout the contemplated term of the Obligations hereunder. To the
extent that Chapter 303 of the Texas Finance Code is relevant for the purpose of determining the
Maximum Rate applicable to a Lender, such Lender elects to determine the applicable rate ceiling
under such Chapter by the weekly ceiling from time to time in effect. Chapter 346 of the Texas
Finance Code does not apply to the Borrower’s obligations hereunder.

     10.10 Counterparts; Integration; Effectiveness. This Agreement may be executed in
counterparts (and by different parties hereto in different counterparts), each of which shall
constitute an original, but all of which when taken together shall constitute a single contract.
This Agreement and the other Loan Documents constitute the entire contract among the parties
relating to the subject matter hereof and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof. Except as provided in
Section 4.01, this Agreement shall become effective when it shall have been executed by the
Administrative Agent and when the Administrative Agent shall have received counterparts hereof
that, when taken together, bear the signatures of each of the other parties hereto. Delivery of an
executed counterpart of a signature page of this Agreement by telecopy shall be effective as
delivery of a manually executed counterpart of this Agreement.

     10.11 Survival of Representations and Warranties. All representations and warranties made
hereunder and in any other Loan Document or other document delivered pursuant hereto or thereto or
in connection herewith or therewith shall survive the execution and delivery hereof and thereof.
Such representations and warranties have been or will be relied upon by the Administrative Agent
and each Lender, regardless of any investigation made by the Administrative Agent or any Lender or
on their behalf and notwithstanding that the Administrative Agent or any Lender may have had notice
or knowledge of any Default at the time of any Credit Extension, and shall continue in full force
and effect as long as any Loan or any other Obligation hereunder shall remain unpaid or unsatisfied
or any Letter of Credit shall remain outstanding.

-92-

 

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

     10.13 Replacement of Lenders. If any Lender requests compensation under Section 3.04,
or if the Borrower is required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 3.01, if any Lender gives a
notice pursuant to Section 3.02, if any Lender is a Defaulting Lender, if any Lender fails
to consent to a requested amendment, waiver, consent or modification as contemplated by Section
10.01 with respect to any Loan Document that requires the consent of each Lender, or each
Lender affected thereby, and that has already been approved by the Required Lenders, or if any
other circumstance exists hereunder that gives the Borrower the right to replace a Lender as a
party hereto, then the Borrower may, at its sole expense and effort, upon notice to such Lender and
the Administrative Agent, require such Lender to assign and delegate, without recourse (in
accordance with and subject to the restrictions contained in, and consents required by, Section
10.06), all of its interests, rights and obligations under this Agreement and the related Loan
Documents to an assignee that shall assume such obligations (which assignee may be another Lender,
if a Lender accepts such assignment), provided that:

     (a) the Borrower shall have paid to the Administrative Agent the assignment fee specified in
Section 10.06(b);

     (b) such Lender shall have received payment of an amount equal to the outstanding principal of
its Loans and L/C Advances, accrued interest thereon, accrued fees and all other amounts payable to
it hereunder and under the other Loan Documents (including any amounts under Section 3.05)
from the assignee (to the extent of such outstanding principal and accrued interest and fees) or
the Borrower (in the case of all other amounts);

     (c) in the case of any such assignment resulting from a claim for compensation under
Section 3.04 or payments required to be made pursuant to Section 3.01, such
assignment will result in a reduction in such compensation or payments thereafter; and

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

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

     10.14 Governing Law; Jurisdiction; Etc.

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

-93-

 

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

     (c) WAIVER OF VENUE. THE BORROWER IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE
LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT IN ANY COURT REFERRED TO IN PARAGRAPH (B) OF THIS SECTION. EACH OF THE PARTIES
HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF
AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.

     (d) SERVICE OF PROCESS. EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS
IN THE MANNER PROVIDED FOR NOTICES IN SECTION 10.02. NOTHING IN THIS AGREEMENT WILL AFFECT
THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.

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

-94-

 

     (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.

     10.16 No Advisory or Fiduciary Responsibility. In connection with all aspects of each
transaction contemplated hereby (including in connection with any amendment, waiver or other
modification hereof or of any other Loan Document), the Borrower acknowledges and agrees, and
acknowledges its Affiliates’ understanding, that: (i) (A) the arranging and other services
regarding this Agreement provided by the Administrative Agent and the Co-Arrangers, are
arm’s-length commercial transactions between the Borrower, each other Loan Party and their
respective Affiliates, on the one hand, and the Administrative Agent and the Co-Arrangers, on the
other hand, (B) each of the Borrower and the other Loan Parties has consulted its own legal,
accounting, regulatory and tax advisors to the extent it has deemed appropriate, and (C) the
Borrower and each other Loan Party is capable of evaluating, and understands and accepts, the
terms, risks and conditions of the transactions contemplated hereby and by the other Loan
Documents; (ii) (A) the Administrative Agent and the Co-Arrangers each is and has been acting
solely as a principal and, except as expressly agreed in writing by the relevant parties, has not
been, is not, and will not be acting as an advisor, agent or fiduciary for the Borrower, any other
Loan Party or any of their respective Affiliates, or any other Person and (B) neither the
Administrative Agent nor any of the Co-Arrangers has any obligation to the Borrower, any other Loan
Party or any of their respective Affiliates with respect to the transactions contemplated hereby
except those obligations expressly set forth herein and in the other Loan Documents; and (iii) the
Administrative Agent and the Co-Arrangers and their respective Affiliates may be engaged in a broad
range of transactions that involve interests that differ from those of the Borrower, the other Loan
Parties and their respective Affiliates, and neither the Administrative Agent nor any of the
Co-Arrangers has any obligation to disclose any of such interests to the Borrower, any other Loan
Party or any of their respective Affiliates. To the fullest extent permitted by law, the Borrower
hereby waives and releases any claims that it may have against the Administrative Agent and the
Co-Arrangers with respect to any breach or alleged breach of agency or fiduciary duty in connection
with any aspect of any transaction contemplated hereby.

     10.17 USA PATRIOT Act Notice. Each Lender that is subject to the Act (as hereinafter defined)
and the Administrative Agent (for itself and not on behalf of any Lender) hereby notifies the
Borrower that pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56
(signed into law October 26, 2001)) (the “Act”), it is required to obtain, verify and
record information that identifies the Borrower, which information includes the name and address of
the Borrower and other information that will allow such Lender or the Administrative Agent, as
applicable, to identify the Borrower in accordance with the Act.

     10.18 No Liability of General Partner. The Administrative Agent and the Lenders agree for
themselves and their respective successors and assigns, including any subsequent holder of any
Note, that no claim against the Borrower or its Subsidiaries under this Agreement or under any
other Loan Document shall be made against General Partner, and that no judgment, order or execution
entered in any suit, action or proceeding, whether legal or equitable, on this Agreement or on any
other Loan Document shall be obtained or enforced against General Partner or its assets for the
purpose of obtaining satisfaction and payment of amounts owed under this

-95-

 

Agreement or any other Loan Document. Nothing in this Section 10.18, however, shall
be construed so as to prevent the Administrative Agent, any Lender or any other holder of any Note
from commencing any action, suit or proceeding with respect to, or causing legal papers to be
served upon, General Partner for the purpose of (a) obtaining jurisdiction over the Borrower or its
Subsidiaries or (b) obtaining judgment, order or execution against General Partner arising out of
any fraud or intentional misrepresentation by General Partner in connection with the Loan Documents
or for the recovery of moneys received by General Partner in violation of this Agreement or any
other Loan Document.

     10.19 Swap Contracts and Guaranty. The benefit of the Guaranty shall also extend to and be
available to those Lenders or their Affiliates which are counterparties to any Swap Contract with
the Borrower or any of its Restricted Subsidiaries on a pro rata basis in respect of any
obligations of any Loan Party which arise under any such Swap Contract while such Person or its
Affiliate is a Lender. No Lender or any Affiliate of a Lender shall have any voting rights under
any Loan Document as a result of the existence of obligations owed to it under any such Swap
Contracts.

     10.20 ENTIRE AGREEMENT. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL
AGREEMENT AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE
PARTIES.

-96-

 

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

	 	 	 	 	 
	 	PIONEER SOUTHWEST ENERGY PARTNERS L.P. 

By:   Pioneer Natural Resources GP LLC, its general
partner

 	 
	 	By:  	/s/ Richard P. Dealy 
 	 
	 	Name:  	Richard P. Dealy 	 
	 	Title:  	Executive Vice President and Chief
Financial Officer 	 

S - 1

 

	 	 	 	 	 

	 	 	 	 	 
	 	BANK OF AMERICA, N.A., as

Administrative Agent

 	 
	 	By:  	/s/ Ronald E. McKaig 
 	 
	 	Name:  	Ronald E. McKaig 	 
	 	Title:  	Senior Vice President 	 
	 

S - 2

 

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

 	 
	 	By:  	/s/ Ronald E. McKaig 
 	 
	 	Name:  	Ronald E. McKaig 	 
	 	Title:  	Senior Vice President 	 
	 

S - 3

 

	 	 	 	 	 
	 	WELLS FARGO BANK, N.A., as Syndication Agent and a
Lender

 	 
	 	By:  	/s/

David C. Brooks 	 
	 	Name:  	David C. Brooks 	 
	 	Title:  	Vice President 	 
	 

S - 4

 

	 	 	 	 	 
	 	BMO CAPITAL MARKETS FINANCING, INC., as Documentation
Agent and a Lender

 	 
	 	By:  	/s/ James V. Ducote 
 	 
	 	Name:  	James V. Ducote 	 
	 	Title:  	Director 	 
	 

S - 5

 

	 	 	 	 	 
	 	BARCLAYS BANK PLC, as a Lender

 	 
	 	By:  	/s/ Joseph Gyurindak 
 	 
	 	Name:  	Joseph Gyurindak 	 
	 	Title:  	Director 	 

S - 6

 

	 	 	 	 	 

	 	 	 	 	 
	 	CITIBANK, N.A., as a Lender

 	 
	 	By:  	/s/ Ashish Sethi 
 	 
	 	Name:  	Ashish Sethi 	 
	 	Title:  	Attorney-in-Fact 	 
	 

S - 7

 

	 	 	 	 	 
	 	DEUTSCHE BANK AG NEW YORK BRANCH, as a Lender

 	 
	 	By:  	/s/ Marcus Tarkington 
 	 
	 	Name:  	Marcus Tarkington 	 
	 	Title:  	Director 	 
	 
	 	 	 
	 	By:  	/s/ Heidi Sandquist 
 	 
	 	Name:  	Heidi Sandquist 	 
	 	Title:  	Vice President 	 
	 

S - 8

 

	 	 	 	 	 
	 	DNB NOR BANK ASA, as a Lender

 	 
	 	By:  	/s/ Philip F. Kurpiewski 
 	 
	 	Name:  	Philip F. Kurpiewski 	 
	 	Title:  	Senior Vice President 	 
	 
	 	 	 
	 	By:  	/s/ Asa Jemseby Rodgers 
 	 
	 	Name:  	Asa Jemseby Rodgers 	 
	 	Title:  	Vice President 	 
	 

S - 9

 

	 	 	 	 	 
	 	JPMORGAN CHASE BANK, N.A., as a Lender

 	 
	 	By:  	/s/ Robert W. Traband 
 	 
	 	Name:  	Robert W. Traband 	 
	 	Title:  	Executive Director 	 
	 

S - 10

 

	 	 	 	 	 
	 	THE ROYAL BANK OF SCOTLAND plc, as a Lender

 	 
	 	By:  	/s/ Scott L. Joyce 
 	 
	 	Name:  	Scott L. Joyce 	 
	 	Title:  	Senior Vice President 	 

S - 11

 

	 	 	 	 	 

	 	 	 	 	 
	 	TORONTO DOMINION (TEXAS) LLC, as a Lender

 	 
	 	By:  	/s/ Debbi L. Brito 
 	 
	 	Name:  	Debbi L. Brito 	 
	 	Title:  	Authorized Signatory 	 
	 

S - 12

 

	 	 	 	 	 
	 	UBS LOAN FINANCE LLC, as a Lender

 	 
	 	By:  	/s/ Irja R. Otsa 
 	 
	 	Name:  	Irja R. Otsa 	 
	 	Title:  	Associate Director

Banking Products Services, US 	 
	 
	 	 	 
	 	By:  	/s/ Richard L. Tavrow 
 	 
	 	Name:  	Richard L. Tavrow 	 
	 	Title:  	Director

Banking Products Services, US 	 

S - 13

 

	 	 	 	 	 

	 	 	 	 	 
	 	U.S. BANK NATIONAL ASSOCIATION, as a Lender

 	 
	 	By:  	/s/ Tyler Fauerbach 
 	 
	 	Name:  	Tyler Fauerbach 	 
	 	Title:  	Vice President 	 
	 

S - 14

 

	 	 	 	 	 
	 	SOCIETE GENERALE, as a Lender

 	 
	 	By:  	/s/ Evena Robciuc 
 	 
	 	Name:  	Evena Robciuc 	 
	 	Title:  	Director 	 
	 

S - 15

 

SCHEDULE 2.01

COMMITMENTS

AND APPLICABLE PERCENTAGES

	 	 	 	 	 	 	 	 	 
	    
                
  Lender	 	Commitment	 	 	Applicable Percentage	 
	Bank of America, N.A.
	 	$	30,000,000.00	 	 	 	10.000000000	%
	Wells Fargo Bank, N.A.
	 	$	30,000,000.00	 	 	 	10.000000000	%
	BMO Capital Markets Financing, Inc.
	 	$	25,000,000.00	 	 	 	8.333333333	%
	Barclays Bank PLC
	 	$	22,000,000.00	 	 	 	7.333333333	%
	Citibank, N.A.
	 	$	22,000,000.00	 	 	 	7.333333333	%
	Deutsche Bank AG New York Branch
	 	$	22,000,000.00	 	 	 	7.333333333	%
	DnB NOR Bank ASA
	 	$	22,000,000.00	 	 	 	7.333333333	%
	JPMorgan Chase Bank, N.A.
	 	$	22,000,000.00	 	 	 	7.333333333	%
	The Royal Bank of Scotland plc
	 	$	22,000,000.00	 	 	 	7.333333333	%
	Toronto Dominion (Texas) LLC
	 	$	22,000,000.00	 	 	 	7.333333333	%
	UBS Loan Finance LLC
	 	$	22,000,000.00	 	 	 	7.333333333	%
	U.S. Bank National Association
	 	$	22,000,000.00	 	 	 	7.333333333	%
	Societe Generale
	 	$	17,000,000.00	 	 	 	5.666666667	%
	 
	Total
	 	$	300,000,000.00	 	 	 	100.000000000	%

1

 

SCHEDULE 5.06

DISCLOSURE MATTERS

None

1

 

SCHEDULE 5.12

SUBSIDIARIES AND

OTHER EQUITY INVESTMENTS

	Part (a).	 	Subsidiaries.

I. Restricted Subsidiaries

Equity Interests Held by Borrower:

	 	 	 	 	 	 	 	 	 
	 	 	State of	 	 	 	 
	 	 	Formation or	 	Percentage of Equity	 	 
	Name of Subsidiary	 	Organization	 	Interests Held	 	Nature of Business
	Pioneer Southwest 

Energy Partners USA 

LLC

	 	Texas
	 	 	100	%	 	Operating
subsidiary of the
Borrower; will
directly or
indirectly own all
the assets of the
Borrower

Equity Interests Held by Pioneer Southwest Energy Partners USA LLC: None

II. Unrestricted Subsidiaries: None

	Part (b).	 	Other Equity Investments.

None.

1

 

SCHEDULE 5.14

GAS IMBALANCES

	1.	 	Oil Volumetric Production Payment via Conveyance of Term Overriding Royalty Interest from
Pioneer Natural Resources USA, Inc. and Pioneer Natural Resources Properties LP to Wolfcamp
Oil and Gas Trust Dated April 18, 2005
	 
	2.	 	Gas Volumetric Production Payment via Conveyance of Term Overriding Royalty Interest from
Pioneer Natural Resources USA, Inc. and Pioneer Natural Resources Properties LP to Wolfcamp
Oil and Gas Trust Dated April 18, 2005

1

 

SCHEDULE 5.15

MARKETING AGREEMENTS

None

1

 

SCHEDULE 5.16

SWAP CONTRACTS

	 	 	 	 	 	 	 	 	 
	Hedge Type/Term (1)	 	Volume (Avg Daily Production) (2)	 	Price ($/Bbl Or $MMbtu)
	Swap contract – Oil – 2008
	 	 	2,750	 	 	$	75.73	 
	Swap contract – Oil – 2009
	 	 	2,500	 	 	$	74.10	 
	Swap contract – Oil – 2010
	 	 	2,000	 	 	$	70.83	 
	Swap contract – NGL – 2008
	 	 	500	 	 	$	44.33	 
	Swap contract – NGL – 2009
	 	 	500	 	 	$	41.75	 
	Swap contract – NGL – 2010
	 	 	500	 	 	$	39.63	 
	Swap contract – Gas – 2008
	 	 	2,500	 	 	$	7.35	 
	Swap contract – Gas – 2009
	 	 	2,500	 	 	$	7.55	 
	Swap contract – Gas – 2010
	 	 	2,500	 	 	$	7.33	 

 

			
	(1)	 	None of the contracts listed above are subject to credit support.
	 
	(2)	 	Oil and NGL volumes in Bbl; Gas volumes in MMbtu.

1

 

SCHEDULE 7.02

EXISTING LIENS

None

1

 

SCHEDULE 7.08

EXISTING RESTRICTIVE AGREEMENTS

None

1

 

SCHEDULE 10.02

ADMINISTRATIVE AGENT’S OFFICE;

CERTAIN ADDRESSES FOR NOTICES

BORROWER:

Pioneer Southwest Energy Partners L.P.

5205 N. O’Connor Blvd., Suite 200

Irving, Texas 75039

Attention: Richard P. Dealy

Telephone: 972-969-4054

Telecopier: 972-969-3572

Electronic Mail: rich.dealy@pxd.com

Website Address: www.pioneersouthwest.com

U.S. Taxpayer Identification Number: 26-0388421

ADMINISTRATIVE AGENT:

Administrative Agent’s Office

(for payments and Requests for Credit Extensions):

Bank of America, N.A.

Bank of America Plaza

901 Main Street, 14th Floor

Dallas, TX 75202-3714

Attention: Ms. Tonya Parker

Telephone: (214) 209-2133

Facsimile: (214) 290-9438:

Electronic Mail: tonya.r.parker@bankofamerica.com

Account No.: 1292000883

Ref: Pioneer Southwest Energy Partners — Tonya Parker

ABA# 026009593

Other Notices as Administrative Agent:

Bank of America, N.A.

Agency Management Officer

901 Main Street, 14th Floor

Mail Code: TX1-492-14-11

Dallas, TX 75202-3714

Attention: Renita Cummings

Telephone: (214) 209-4130

Telecopier: (214) 290-8371

Electronic Mail: renita.m.cummings@bankofamerica.com

1

 

L/C ISSUER:

Bank of America, N.A.

Trade Operations

1000 West Temple Street, 7th Floor

Mail Code: CA9-705-05

Los Angeles, CA 90012-1514

Attention: Bolivar Carrillo

Telephone: (213) 481-7842

Telecopier: (213) 457-8841

Electronic Mail: bolivar.carrillo@bankofamerica.com

SWING LINE LENDER:

Bank of America, N.A.

Bank of America Plaza

901 Main Street, 14th Floor

Dallas, TX 75202

Attention: Ms. Tonya Parker

Telephone: (214) 209-2133

Facsimile: (214) 290-9438:

Electronic Mail: tonya.r.parker@bankofamerica.com

Account No.: 1292000883

Ref: Pioneer Southwest Energy Partners — Tonya Parker

ABA# 026009593

2

 

EXHIBIT A

FORM OF COMMITTED LOAN NOTICE

Date:     
                                    ,                     

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

Ladies and Gentlemen:

     Reference is made to that certain Credit Agreement, dated as of October 29, 2007 (as amended,
restated, extended, supplemented or otherwise modified in writing from time to time, the
“Agreement;” the terms defined therein being used herein as therein defined), among Pioneer
Southwest Energy Partners L.P., a Delaware limited partnership (the “Borrower”), the
Lenders from time to time party thereto, Bank of America, N.A., as Administrative Agent, L/C Issuer
and Swing Line Lender, Wells Fargo Bank, N.A., as Syndication Agent, and BMO Capital Markets
Financing, Inc., as documentation agent.

	 	 	 	 	 
	 

	 	The undersigned hereby requests (select one):	 	 
	 
	 	 	 	 
	 

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

	 	  1.	 	On              
              
               
                
   (a Business Day).
	 
	 	  2.	 	In the amount of $           
         .
	 
	 	  3.	 	Comprised of                     .

[Type of Committed Loan requested]

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

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

	 	 	 	 	 
	 	 	PIONEER SOUTHWEST ENERGY PARTNERS L.P.
	 
	 	 	 	 
	 	 	By: Pioneer Natural Resources GP LLC, its general partner
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	Name:	 	 
	 

	 	Title:	 	 

Form of Committed Loan Notice

A - 1

 

EXHIBIT B

FORM OF SWING LINE LOAN NOTICE

Date:                                         ,                     

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

Ladies and Gentlemen:

     Reference is made to that certain Credit Agreement, dated as of October 29, 2007 (as amended,
restated, extended, supplemented or otherwise modified in writing from time to time, the
“Agreement;” the terms defined therein being used herein as therein defined), among Pioneer
Southwest Energy Partners L.P., a Delaware limited partnership (the “Borrower”), the
Lenders from time to time party thereto, Bank of America, N.A., as Administrative Agent, L/C Issuer
and Swing Line Lender, Wells Fargo Bank, N.A., as Syndication Agent, and BMO Capital Markets
Financing, Inc., as documentation agent.

     The undersigned hereby requests a Swing Line Loan:

	 	1.	 	On                                                              (a Business Day).
	 
	 	2.	 	In the amount of $                    .

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

	 	 	 	 	 
	 	 	PIONEER SOUTHWEST ENERGY PARTNERS L.P.
	 
	 	 	 	 
	 	 	By: Pioneer Natural Resources GP LLC, its general partner
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	Name:	 	 
	 

	 	Title:	 	 

Form of Swing Line Loan Notice

B - 1

 

EXHIBIT C

FORM OF NOTE

     FOR VALUE RECEIVED, the undersigned (the “Borrower”) hereby promises to pay to
                                         or registered assigns (the “Lender”), in accordance with the
provisions of the Agreement (as hereinafter defined), the principal amount of each Loan from time
to time made by the Lender to the Borrower under that certain Credit Agreement, dated as of
October 29, 2007 (as amended, restated, extended, supplemented or otherwise modified in writing
from time to time, the “Agreement;” the terms defined therein being used herein as therein
defined), among the Borrower, the Lenders from time to time party thereto, Bank of America, N.A.,
as Administrative Agent, L/C Issuer and Swing Line Lender, Wells Fargo Bank, N.A., as Syndication
Agent, and BMO Capital Markets Financing, Inc., as documentation agent.

     The Borrower promises to pay interest on the unpaid principal amount of each Loan from the
date of such Loan until such principal amount is paid in full, at such interest rates and at such
times as provided in the Agreement. Except as otherwise provided in Section 2.04(f) of the
Agreement with respect to Swing Line Loans, all payments of principal and interest shall be made to
the Administrative Agent for the account of the Lender in Dollars in immediately available funds at
the Administrative Agent’s Office. If any amount is not paid in full when due hereunder, such
unpaid amount shall bear interest, to be paid upon demand, from the due date thereof until the date
of actual payment (and before as well as after judgment) computed at the per annum rate set forth
in the Agreement.

     This Note is one of the Notes referred to in the Agreement, is entitled to the benefits
thereof and may be prepaid in whole or in part subject to the terms and conditions provided
therein. This Note is also entitled to the benefits of the Guaranty. Upon the occurrence and
continuation of one or more of the Events of Default specified in the Agreement, all amounts then
remaining unpaid on this Note shall become, or may be declared to be, immediately due and payable
all as provided in the Agreement. Loans made by the Lender shall be evidenced by one or more loan
accounts or records maintained by the Lender in the ordinary course of business. The Lender may
also attach schedules to this Note and endorse thereon the date, amount and maturity of its Loans
and payments with respect thereto.

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

Form of Note

C - 1

 

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

	 	 	 	 	 
	 	 	PIONEER SOUTHWEST ENERGY PARTNERS L.P.
	 
	 	 	 	 
	 	 	By: Pioneer Natural Resources GP LLC, its general partner
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	Name:	 	 
	 

	 	Title:	 	 

Form of Note

C - 2

 

LOANS AND PAYMENTS WITH RESPECT THERETO

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

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 	 
	 	 
	 	 

Form of Note

C - 3

 

EXHIBIT D

FORM OF COMPLIANCE CERTIFICATE

Financial Statement Date:           ,

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

Ladies and Gentlemen:

     Reference is made to that certain Credit Agreement, dated as of October 29, 2007 (as amended,
restated, extended, supplemented or otherwise modified in writing from time to time, the
“Agreement;” the terms defined therein being used herein as therein defined), among Pioneer
Southwest Energy Partners L.P., a Delaware limited partnership (the “Borrower”), the
Lenders from time to time party thereto, Bank of America, N.A., as Administrative Agent, L/C Issuer
and Swing Line Lender, Wells Fargo Bank, N.A., as Syndication Agent, and BMO Capital Markets
Financing, Inc., as documentation 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 Certificate to
the Administrative Agent on the behalf of the Borrower, and that:

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

     1. The Borrower has delivered the year-end audited financial statements required by
Section 6.01(a) of the Agreement for the fiscal year of the Borrower ended as of the above
date, together with the report and opinion of an independent certified public accountant required
by such section.

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

     1. The Borrower has delivered the unaudited financial statements required by Section
6.01(b) of the Agreement for the fiscal quarter of the Borrower ended as of the above date.
Such financial statements fairly present the financial condition, results of operations and cash
flows of the Borrower and its Subsidiaries in accordance with GAAP as at such date and for such
period, subject only to normal year-end audit adjustments and the absence of footnotes.

     2. The undersigned has reviewed and is familiar with the terms of the Agreement and has made,
or has caused to be made under his/her supervision, a detailed review of the transactions and
condition (financial or otherwise) of the Borrower during the accounting period covered by such
financial statements.

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

Form of Compliance Certificate

D - 1

 

[select one:]

     [to the best knowledge of the undersigned, during such fiscal period the Borrower performed
and observed each covenant and condition of the Loan Documents applicable to it, and no Default has
occurred and is continuing.]

—or—

     [to the best knowledge of the undersigned, during such fiscal period the following covenants
or conditions have not been performed or observed and the following is a list of each such Default
and its nature and status:]

     4. The representations and warranties of the Borrower contained in Article V of the
Agreement, and any representations and warranties of any Loan Party that are contained in any
document furnished at any time under or in connection with the Loan Documents, are true and correct
on and as of the date hereof, except to the extent that such representations and warranties
specifically refer to an earlier date, in which case they are true and correct as of such earlier
date, and except that for purposes of this Compliance Certificate, the representations and
warranties contained in subsections (a) and (b) of Section 5.04 of the Agreement shall be
deemed to refer to the most recent statements furnished pursuant to clauses (a) and (b),
respectively, of Section 6.01 of the Agreement, including the statements in connection with
which this Compliance Certificate is delivered.

     5. The financial covenant analyses and information set forth on Schedules 1 and
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                                         ,
                    .

	 	 	 	 	 
	 	 	PIONEER SOUTHWEST ENERGY PARTNERS L.P.
	 
	 	 	 	 
	 	 	By: Pioneer Natural Resources GP LLC, its general partner
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	Name:	 	 
	 

	 	Title:	 	 

Form of Compliance Certificate

D - 2

 

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

SCHEDULE 1

to the Compliance Certificate

($ in 000’s)

	 	 	 	 	 
	I. Section 7.04 (a) – Consolidated Interest Coverage Ratio.
	 	 	 	 
	A. Consolidated Adjusted EBITDAX for four consecutive fiscal
quarters ending on above date (“Subject Period”) (from
Schedule 3)
	 	$	                    	 
	 
	 	 	 	 
	B. Consolidated Interest Charges for Subject Period:
	 	$	                    	 
	 
	 	 	 	 
	C. Consolidated Interest Coverage Ratio (Line I.A  ̧
Line I.B):
	 	                      to 1
	 
	 	 	 	 
	D. Minimum Required Consolidated Interest Coverage Ratio
	 	 	2.50 to 1
	 
	 	 	 	 
	II. Section 7.04 (b) – PV to Consolidated Indebtedness Ratio.
	 	 	 	 
	A. PV at Statement Date:
	 	 	 	 
	1. PV relating to Proved Reserves
	 	$	                    	 
	2. PV relating to Midstream Assets
	 	$	                    	 
	PV (Line II.A.1 + Line II.A.2):
	 	$	                    	 
	 
	 	 	 	 
	B. Consolidated Indebtedness at Statement Date:
	 	$	                    	 
	 
	 	 	 	 
	C. PV to Consolidated Indebtedness Ratio (Line III.A  ̧ Line III.B):
	 	                     to 1
	 
	 	 	 	 
	D. Minimum Required PV to Consolidated Indebtedness Ratio:
	 	 	1.75 to 1
	 
	 	 	 	 
	III. Section 7.04 (c) – Consolidated Leverage Ratio.
	 	 	 	 
	A. Consolidated Indebtedness at Statement Date:
	 	$	                    	 
	 
	 	 	 	 
	B. Consolidated Adjusted EBITDAX for Subject Period (Line I.A.):
	 	$	                    	 
	 
	 	 	 	 
	C. Consolidated Leverage Ratio (Line III.A  ̧ Line III.B):
	 	                     to 1
	 
	 	 	 	 
	D. Maximum Permitted Consolidated Leverage Ratio
	 	[3.50 to 1]1

 

			
	1	 	If Compliance Certificate is being submitted during an
Acquisition Period, note such fact and revise Maximum Permitted Consolidated
Leverage Ratio to read 4.00 to 1.

Form of Compliance Certificate

D - 3

 

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

SCHEDULE 2

to the Compliance Certificate

($ in 000’s)

Consolidated EBITDAX and Consolidated Adjusted EBITDAX

(in accordance with the definition of Consolidated EBITDAX and Consolidated Adjusted

EBITDAX as set forth in the Agreement)

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Twelve	 
	Consolidated	 	Quarter	 	 	Quarter	 	 	Quarter	 	 	Quarter	 	 	Months	 
	EBITDAX	 	Ended	 	 	Ended	 	 	Ended	 	 	Ended	 	 	Ended	 
	Consolidated
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Net Income
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	+ Consolidated
Interest Charges
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	+ income taxes
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	+ depreciation
expense
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	+ depletion expense
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	+ amortization
expense
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	+ non-cash losses
(SFAS 133)
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	+ non-cash losses
(SFAS 143/144)
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	+ exploration costs
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	+ abandonment
expenses
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	+ non-cash equity
based compensation
expenses
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	+ non-cash losses
on asset
disposition
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	+ non-recurring
non-cash expenses
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	- income tax
credits
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	- non-cash credits
(SFAS 133)
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	- non-cash gains
on asset
disposition
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	- non-cash income
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	= Consolidated
EBITDAX
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

Form of Compliance Certificate

D - 4

 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Consolidated	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Adjusted	 	Quarter	 	 	Quarter	 	 	Quarter	 	 	Quarter	 	 	Twelve Months	 
	EBITDAX	 	Ended	 	 	Ended	 	 	Ended	 	 	Ended	 	 	Ended	 
	Consolidated
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	EBITDAX
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	+ Adjustment for
acquisition or
disposition
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	+ other pro forma
adjustments
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	- income tax
credits
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	- non-cash income
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	= Consolidated
Adjusted
EBITDAX
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

Form of Compliance Certificate

D - 5

 

EXHIBIT E

ASSIGNMENT AND ASSUMPTION

     This Assignment and Assumption (this “Assignment and Assumption”) is dated as of the
Effective Date set forth below and is entered into by and between [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 (the “Credit Agreement”),
receipt of a copy of which is hereby acknowledged by the Assignee. The Standard Terms and
Conditions set forth in Annex 1 attached hereto are hereby agreed to and incorporated herein by
reference and made a part of this Assignment and Assumption as if set forth herein in full.

     For an agreed consideration, [the][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, the Letters of Credit and the Swing Line Loans
included in such facilities) and (ii) to the extent permitted to be assigned under applicable law,
all claims, suits, causes of action and any other right of [the Assignor (in its capacity as a
Lender)][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

 

			
	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.

Form of Assignment and Assumption

E - 1

 

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]:
	 	 

	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 

	 	 
	 
	 	 	 	 	 	 
	 	 	[for each Assignee, indicate [Affiliate][Approved Fund] of [identify Lender]]

	3.	 	Borrower(s): Pioneer Southwest Energy Partners L.P., a Delaware limited partnership
	 
	4.	 	Administrative Agent: Bank of America, N.A., as the administrative agent under the
Credit Agreement
	 
	5.	 	Credit Agreement: Credit Agreement, dated as of October 29, 2007, among Pioneer
Southwest Energy Partners L.P., a Delaware limited partnership, as Borrower, the Lenders from
time to time party thereto, Bank of America, N.A., as Administrative Agent, L/C Issuer, and
Swing Line Lender, Wells Fargo Bank, N.A., as Syndication Agent, and BMO Capital Markets
Financing, Inc., as documentation agent.
	 
	6.	 	Assigned Interest[s]:

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Revolving	 	Aggregate	 	 	 	 	 	 
	 	 	 	 	Credit	 	Amount of	 	Amount of	 	Percentage	 	 
	 	 	 	 	Commitment	 	Commitment	 	Commitment	 	Assigned of	 	CUSIP
	Assignor[s]6	 	Assignee[s]7	 	Assigned	 	for all Lenders8	 	Assigned	 	Commitment	 	Number
	 

	 	 	 	___
	 	$___
	 	$___
	 	___%	 	 
	 

	 	 	 	___
	 	$___
	 	$___
	 	___%	 	 
	 

	 	 	 	___
	 	$___
	 	$___
	 	___%	 	 

 

			
	6	 	List each Assignor, as appropriate.
	 
	7	 	List each Assignee, as appropriate.
	 
	8	 	Amounts in this column and in the column immediately to
the right to be adjusted by the counterparties to take into account any
payments or prepayments made between the Trade Date and the Effective Date.

Form of Assignment and Assumption

E - 2

 

[7.    Trade Date:                                         ]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	 	 
	 	 	[NAME OF ASSIGNOR]	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Title:
	 	 
	 
	 	 	 	 	 	 
	 	 	ASSIGNEE	 	 
	 	 	[NAME OF ASSIGNEE]	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Title:
	 	 

	 	 	 	 	 
	[Consented to and]10 Accepted:	 	 
	 
	 	 	 	 
	BANK OF AMERICA, N.A., as	 	 
	 Administrative Agent	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

Title:
	 	 
	 
	 	 	 	 
	[Consented to:]11	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

Title:
	 	 

 

			
	9	 	To be completed if the Assignor and the Assignee intend
that the minimum assignment amount is to be determined as of the Trade Date.
	 
	10	 	To be added only if the consent of the Administrative
Agent is required by the terms of the Credit Agreement.
	 
	11	 	To be added only if the consent of the Borrower and/or
other parties (e.g. Swing Line Lender, L/C Issuer) is required by the terms of
the Credit Agreement.

Form of Assignment and Assumption

E - 3

 

 

ANNEX 1 TO ASSIGNMENT AND ASSUMPTION

[                                        ]12

STANDARD TERMS AND CONDITIONS FOR

ASSIGNMENT AND ASSUMPTION

          1. Representations and Warranties.

          1.1 Assignor. [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 and (iii) it has full
power and authority, and has taken all action necessary, to execute and deliver this Assignment and
Assumption and to consummate the transactions contemplated hereby; and (b) assumes no
responsibility with respect to (i) any statements, warranties or representations made in or in
connection with the Credit Agreement or any other Loan Document, (ii) the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any collateral
thereunder, (iii) the financial condition of the Borrower, any of its Subsidiaries or Affiliates or
any other Person obligated in respect of any Loan Document or (iv) the performance or observance by
the Borrower, any of its Subsidiaries or Affiliates or any other Person of any of their respective
obligations under any Loan Document.

          1.2 Assignee. [The][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
10.06(b)(iii), (v) and (vi) of the Credit Agreement (subject to such consents,
if any, as may be required under Section 10.06(b)(iii) 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][such] Assigned Interest and either it, or the Person
exercising discretion in making its decision to acquire [the][such] 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 ___ 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 hereto is any documentation required to be
delivered by it pursuant to

 

			
	12	 	Describe Credit Agreement at option of Administrative
Agent.

Form of Assignment and Assumption

E - 4

 

 

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 upon 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 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.

          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.

Form of Assignment and Assumption

E - 5

 

EXHIBIT F

FORM OF GUARANTY

[attached]

Form of Guaranty

F - 1

 

EXHIBIT G

OPINION MATTERS

     The matters contained in the following Sections of the Credit Agreement should be covered by
the legal opinion:

	 	•	 	Section 5.01
	 
	 	•	 	Section 5.02
	 
	 	•	 	Section 5.03
	 
	 	•	 	Section 5.06
	 
	 	•	 	Section 5.08

Opinion Matters

G - 1

 

EXHIBIT H

GENERAL PARTNER CERTIFICATE

November   , 2007

The Lenders and L/C Issuer party to the Credit Agreement

     referred to below

Bank of America, N.A.,
     as
Administrative Agent (as defined below)

Ladies and Gentlemen,

     Reference is hereby made to that certain Credit Agreement, dated as of October 29, 2007
(together with all amendments and other modifications, if any, from time to time thereafter made
thereto, the “Credit Agreement”), among Pioneer Southwest Energy Partners L.P., a Delaware
limited partnership (the “Borrower”), the various financial institutions as are or may
become parties thereto (collectively, the “Lenders”), Bank of America, N.A., as letter of
credit issuer (the “L/C Issuer”), Bank of America, N.A., as administrative agent for the Lenders
(in such capacity together with its successors in such capacity, the “Administrative
Agent”), Wells Fargo Bank, N.A., as syndication agent, and BMO Capital Markets Financing, Inc.,
as documentation agent. Unless otherwise defined herein or the context otherwise requires,
capitalized terms used herein have the same meanings as set forth in the Credit Agreement.

     In consideration of the Lenders, L/C Issuer and the Administrative Agent entering into the
Credit Agreement, Pioneer Natural Resources GP LLC, a Delaware limited liability company and the
sole general partner of the Borrower (the “General Partner”), hereby agrees that, for so
long as it is a general partner of the Borrower, (a) its sole business will be to act as the
general partner of the Borrower and as a member, partner or stockholder of any limited liability
company, limited partnership or corporation of which any Loan Party, or any of their Subsidiaries,
is, directly or indirectly, a limited partner and to undertake activities that are ancillary or
related thereto (including being a limited partner in the Borrower), (b) it shall not enter into or
conduct any business or incur any debts or liabilities except in connection with or incidental to
(i) its performance of the activities required or authorized by the Partnership Agreement, and (ii)
the acquisition, ownership or disposition of partnership interests in the MLP or any further
limited partnership of which the Borrower or any other Loan Party is, directly or indirectly, a
limited partner; and (c) it shall not take any action or refuse to take any reasonable action the
effect of which, if taken or not taken, as the case may be, would be to cause Borrower to be
treated as an association taxable as a corporation or otherwise to be taxed as an entity other than
a partnership for Federal income tax purposes.

     General Partner hereby acknowledges that its agreements contained herein are an inducement to
the Lenders, the L/C Issuer and the Administrative Agent entering into the Credit Agreement and
that this letter is, and shall be deemed to be, a Loan Document.

General Partner Certificate

H - 1

 

     THIS LETTER SHALL BE GOVERNED BY THE LAWS OF THE STATE OF TEXAS (WITHOUT REGARD TO ANY
CONFLICTS OF LAW PRINCIPLES THAT WOULD REQUIRE THE APPLICATION OF THE LAW OF ANY OTHER
JURISDICTION).

	 	 	 	 	 
	 	 	Very truly yours,
	 
	 	 	 	 
	 	 	PIONEER NATURAL RESOURCES GP LLC
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	Name:	 	 
	 

	 	Title:	 	 

General Partner Certificate

H - 2

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00132-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00132-of-00352.parquet"}]]