Document:

exv10w1

 

Exhibit 10.1

 

AMENDED AND RESTATED CREDIT AGREEMENT

dated as of November 30, 2006

among

NOBLE ENERGY, INC.,

as the Borrower,

JPMORGAN CHASE BANK, N.A.,

as the Administrative Agent for the Lenders,

WACHOVIA BANK, NATIONAL ASSOCIATION

and

THE ROYAL BANK OF SCOTLAND PLC,

as the Co-Syndication Agents for the Lenders,

DEUTSCHE BANK SECURITIES INC.,

CITIBANK, N.A.

and

THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.,

as the Co-Documentation Agents for the Lenders,

and

CERTAIN COMMERCIAL LENDING INSTITUTIONS,

as the Lenders

 

J.P. MORGAN SECURITIES INC.,

as Sole Lead Arranger and Sole Bookrunner

 

 

 

AMENDED AND RESTATED CREDIT AGREEMENT

     THIS AMENDED AND RESTATED CREDIT AGREEMENT, dated as of November 30, 2006 (as may be amended,
restated, supplemented or otherwise modified from time to time, this “Agreement”), is among
NOBLE ENERGY, INC., a Delaware corporation (the “Borrower”), JPMORGAN CHASE BANK, N.A.
(“JPMCB”), as administrative agent (JPMCB in such capacity, together with any successor(s)
thereto in such capacity, the “Administrative Agent”), WACHOVIA BANK, NATIONAL ASSOCIATION
and THE ROYAL BANK OF SCOTLAND PLC, as co-syndication agents (in such capacity, together with any
successor(s) thereto in such capacity, individually, a “Co-Syndication Agent” and,
collectively, the “Co-Syndication Agents”), DEUTSCHE BANK SECURITIES INC., CITIBANK, N.A.
and THE BANK OF TOKYO-MITSUBISHI UFJ, LTD., as co-documentation agents (in such capacity, together
with any successor(s) thereto in such capacity, individually, a “Co-Documentation Agent”
and, collectively, the “Co-Documentation Agents”), and certain commercial lending
institutions as are or may become parties hereto (collectively, the “Lenders”).

W I T N E S S E T H:

     WHEREAS, the Borrower, various financial institutions (the “Existing Lenders”), JPMCB,
in its capacity as Issuing Bank, and JPMCB, in its capacity as Administrative Agent, heretofore
entered into that certain Credit Agreement, dated as of December 9, 2005 (such agreement, the
“Existing Credit Agreement”) pursuant to which the Existing Lenders agreed to make loans
(therein referred to as the “Existing Loans”) to the Borrower and the Issuing Bank agreed
to issue letters of credit for the Borrower; and

     WHEREAS, the Borrower would like to obtain commitments from the Lenders pursuant to which
loans in a maximum aggregate principal amount at any one time outstanding not to exceed the amounts
herein provided will be made to the Borrower from time to time during the Availability Period; and

     WHEREAS, the Lenders are willing, on the terms and subject to the conditions herein set forth
(including Article V), to extend such Commitments and make such Loans to the Borrower; and

     WHEREAS, the Issuing Bank is willing, on the terms and subject to the conditions hereinafter
set forth (including Article V), to issue Letters of Credit on behalf of the Borrower; and

     WHEREAS, the Swingline Lender is willing, on the terms and subject to the conditions
hereinafter set forth (including Article V), to extend such commitments and to make such
Swingline Loans to the Borrower; and

     WHEREAS, the proceeds of such Loans and the Letters of Credit will be used for general
corporate purposes of the Borrower; and

     WHEREAS, certain financial institutions not previously a party to the Existing Credit
Agreement intend to become party to the Agreement as more fully described in the next succeeding
paragraph; and

 

 

     WHEREAS, the Borrower has requested that the Existing Lenders, and the Existing Lenders have
agreed to, restructure, rearrange, renew, extend and refinance all indebtedness evidenced by and
outstanding under the Existing Credit Agreement as of the Effective Date (the “Prior
Indebtedness”) into obligations and commitments under the Agreement; and

     WHEREAS, as part of the restructuring and rearranging of the Prior Indebtedness, the Existing
Lenders shall modify their respective commitments under the Existing Credit Agreement such that on
the Effective Date each Existing Lender shall be obligated hereunder, subject to the terms hereof,
to the Commitment set forth opposite such Lender’s name on Schedule II; and

     WHEREAS, any loans outstanding under the Existing Credit Agreement on the Effective Date shall
be deemed continued as Loans under this Agreement and any letters of credit outstanding under the
Existing Credit Agreement on the Effective Date shall be deemed continued as Letters of Credit
under this Agreement; and

     WHEREAS, the Borrower, the Lenders, the Issuing Bank, the Swingline Lender and the Agent
intend to amend and restate the Existing Credit Agreement in its entirety as set forth in the
Agreement; and

     WHEREAS, the parties hereto intend that on the Effective Date hereof pursuant to Article
V, (1) the commitments and loans under the Existing Credit Agreement shall become Commitments
and Loans, respectively, under the Agreement, (2) interest accrued on the loans and commitment fees
accrued under the Existing Credit Agreement through the Effective Date hereof shall be deemed due
and payable hereunder, and (3) the Lenders hereunder shall be deemed to have purchased
participations in the outstanding Letters of Credit, pro rata according to their respective
Percentages.

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

ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS

     SECTION 1.1 Defined Terms. The following terms (whether or not underscored) when used
in this Agreement, including its preamble and recitals, shall, except where the context otherwise
requires, have the following meanings (such meanings to be equally applicable to the singular and
plural forms thereof):

     “Administrative Agent” is defined in the preamble and includes each other
Person as shall have subsequently been appointed as the successor Administrative Agent pursuant to
Section 9.4.

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

     “Affiliate” of any Person means any other Person which, directly or indirectly,
controls, is controlled by or is under common control with such Person (excluding any trustee
under, or

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any committee with responsibility for administering, any Plan). A Person shall be deemed to
be “controlled by” any other Person if such other Person possesses, directly or indirectly, power
(a) to vote 20% or more of the securities (on a fully diluted basis) having ordinary voting power
for the election of directors or managing general partners; or (b) to direct or cause the direction
of the management and policies of such Person whether by contract or otherwise.

     “Agents” means the Administrative Agent, the Co-Syndication Agents, and the
Co-Documentation Agents, together with any successors in any such capacities.

     “Agreement” means, on any date, this Amended and Restated Credit Agreement as
originally in effect on the Effective Date and as thereafter from time to time amended,
supplemented, amended and restated, or otherwise modified and in effect on such date.

     “Applicable Facility Fee Rate” means the number of basis points per annum (based on a
year of 360 days) set forth below based on the Applicable Rating Level on such date:

	 	 	 	 	 
	Applicable Rating Level	 	Applicable Facility Fee Rate
	Level I
	 	 	5.0	 
	Level II
	 	 	7.0	 
	Level III
	 	 	9.0	 
	Level IV
	 	 	11.0	 
	Level V
	 	 	15.0	 

Changes in the Applicable Facility Fee Rate will occur automatically without prior notice. The
Administrative Agent will give notice promptly to the Borrower and the Lenders of changes in the
Applicable Facility Fee Rate.

     “Applicable Margin” means on any date and with respect to each Eurodollar Loan or
Swingline Loan, as applicable, the number of basis points per annum set forth below based on the
Applicable Rating Level on such date:

	 	 	 	 	 
	Applicable Rating	 	Utilization less than	 	Utilization greater
	Level	 	or equal to 65%	 	than 65%
	Level I

	 	20.0
	 	25.0
	Level II
	 	23.0
	 	28.0
	Level III
	 	31.0
	 	36.0
	Level IV
	 	44.0
	 	54.0
	Level V
	 	60.0
	 	70.0

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Changes in the Applicable Margin will occur automatically without prior notice. The Administrative
Agent will give notice promptly to the Borrower and the Lenders of changes in the Applicable
Margin.

     “Applicable Rating Level” means (i) at any time that Moody’s and S&P have the
equivalent rating or split ratings of not more than one rating differential of the Borrower’s
senior unsecured long-term debt, the level set forth in the chart below under the heading
“Applicable Rating Level” opposite the rating under the heading “Moody’s” or “S&P” which is the
higher of the two if split ratings or opposite the ratings under the headings “Moody’s” and “S&P”
if equivalent, and (ii) at any time that Moody’s and S&P have split ratings of more than one rating
differential of the Borrower’s senior unsecured long-term debt, the level set forth in the chart
below under the “Applicable Rating Level” opposite the rating under the heading “Moody’s” or “S&P”
which is one rating lower than the higher of the two split ratings.

	 	 	 	 	 	 	 	 	 
	Applicable Rating Level	 	Moody’s	 	S&P
	Level I
	 	 	3A3	 	 	 	3A	-
	Level II
	 	Baa1	 	BBB	+
	Level III
	 	Baa2	 	BBB	 
	Level IV
	 	Baa3	 	BBB	-
	Level V
	 	£Ba1	 	£BB	+

For example, if the Moody’s rating is Baa1 and the S&P rating is BBB, Level II shall apply.

     For purposes of the foregoing, (i) “3” means a rating equal to or more favorable than; “£”
means a rating equal to or less favorable than; “>” means a rating greater than; “<” means a
rating less than; (ii) if a rating for the Borrower’s senior unsecured long-term debt is not
available from one of the Rating Agencies, the Applicable Rating Level will be based on the rating
of the other Rating Agency; (iii) if ratings for the Borrower’s senior unsecured long-term debt is
available from neither S&P nor Moody’s, Level V shall be deemed applicable; (iv) if
determinative ratings shall change (other than as a result of a change in the rating system used by
any applicable Rating Agency) such that a change in Applicable Rating Level would result, such
change shall effect a change in Applicable Rating Level as of the day on which it is first
announced by the applicable Rating Agency, and any change in the Applicable Margin or percentage
used in calculating fees due hereunder shall apply commencing on the effective date of such change
and ending on the date immediately preceding the effective date of the next such change; (v) if the
rating system of any of the Rating Agencies shall change prior to the date all obligations
hereunder have been paid and the Commitments canceled, the Borrower and the Lenders shall negotiate
in good faith to amend the references to specific ratings in this definition to reflect such
changed rating system, and pending such amendment, if no Applicable Rating Level is otherwise
determinable based upon the foregoing, Level V shall apply; and (vi) in the event that
either S&P or Moody’s is no longer in the business of providing ratings, Fitch shall be substituted
for such entity for the purposes of this definition.

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     “Approved Fund” is defined in Section 10.10.1.

     “Arranger” means J.P. Morgan Securities Inc., in its capacity as sole lead arranger
and sole bookrunner.

     “ASK Rate” means, on any date and with respect to ASK Rate Loans, a fluctuating rate
of interest per annum equal to the “ASK” rate for Federal Funds appearing on Page 5 of the Telerate
Service (or on any successor or substitute page of such Service, or any successor to or substitute
for such Service, providing rate quotations comparable to those currently provided on such page of
such Service, as determined by the Administrative Agent from time to time for purposes of providing
quotations of the offer rates applicable to Federal Funds for a term of one Business Day) at the
time reviewed by the Administrative Agent. In the event such rate is not available at such time
for any reason, then such rate will be the rate agreed to between the Administrative Agent and the
Borrower. The Borrower understands and agrees that the rate quoted from Page 5 of the Telerate
Service is a real-time rate that changes from time to time but that the Administrative Agent will
set the ASK Rate no more than once per Business Day. The rate quoted by the Administrative Agent
and used for the purpose of setting the interest rate for a Swingline Loan until the next Business
Day will be the rate on the screen of the Administrative Agent at the time of setting the rate and
will not be an average or composite of rates for that day. Changes in the rate of interest on that
portion of any Loans maintained as ASK Rate Loans will take effect simultaneously with each such
setting of the ASK Rate.

     “Assignee Lender” is defined in Section 10.10.1.

     “Authorized Officer” means, relative to the Borrower, the President, any Senior Vice
President, the Treasurer or the Secretary of the Borrower, or any other officer of the Borrower
specified as such to the Administrative Agent in writing by any of the aforementioned officers of
the Borrower.

     “Availability Period” means the period from and including the Effective Date to but
excluding the Maturity Date.

     “Base Rate” means, on any date and with respect to all Base Rate Loans, a fluctuating
rate of interest per annum equal to the higher of (a) the rate of interest most recently announced
by JPMCB at its Domestic Office as its base rate for Dollar loans; and (b) the Federal Funds Rate
most recently determined by the Administrative Agent plus 1/2%. The Base Rate is not necessarily
intended to be the lowest rate of interest determined by JPMCB in connection with extensions of
credit. Changes in the rate of interest on that portion of any Loans maintained as Base Rate Loans
will take effect simultaneously with each change in the Base Rate. The Administrative Agent will
give notice promptly to the Borrower and the Lenders of changes in the Base Rate.

     “Base Rate Loan” means a Loan bearing interest at a fluctuating rate determined by
reference to the Base Rate.

     “Borrower” is defined in the preamble, and includes its permitted successors
and assigns.

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     “Borrowing” means any extension of credit (as opposed to any continuation or
conversion thereof) made by the Lenders by way of Loans.

     “Borrowing Date” means a date on which a Borrowing is made hereunder.

     “Borrowing Request” means a loan request and certificate duly executed by an
Authorized Officer of the Borrower, substantially in the form of Exhibit 2.5 hereto.

     “Business Day” means (a) any day which is neither a Saturday or Sunday nor a legal
holiday on which banks are authorized or required to be closed in New York, New York or Houston,
Texas; and (b) relative to the making, continuing, prepaying or repaying of any Eurodollar
Borrowing, any day on which dealings in Dollars are carried on in the London and New York
Eurodollar interbank market.

     “Capitalization” means the sum, at any time outstanding and without duplication, of
(i) Debt plus (ii) Stockholders’ Equity.

     “Capitalized Lease Liabilities” means all monetary obligations of the Borrower or any
of its Subsidiaries under any leasing or similar arrangement which, in accordance with GAAP, would
be classified as capitalized leases, and, for purposes of this Agreement and each other Loan
Document, the amount of such obligations shall be the capitalized amount thereof, determined in
accordance with GAAP.

     “CERCLA” means the Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended.

     “Change in Control” means the acquisition by any Person, or two or more Persons acting
in concert, of beneficial ownership (within the meaning of Rule 13d-3 of the Securities and
Exchange Commission under the Securities Exchange Act of 1934) of 30% or more of the outstanding
shares of voting stock of the Borrower.

     “CI Lender” is defined in Section 2.9(a).

     “Code” means the Internal Revenue Code of 1986, as amended, reformed or otherwise
modified from time to time.

     “Co-Documentation Agent” and “Co-Documentation Agents” are defined in the
preamble.

     “Commitment” means, as to any Lender, the obligation, if any, of such Lender to make
Loans pursuant to Section 2.1.1 of this Agreement, to acquire participations in Letters of
Credit pursuant to Section 2.11 of this Agreement, and to acquire participations in
Swingline Loans pursuant to Section 2.1.2 of this Agreement, expressed as an amount
representing the maximum aggregate amount of such Lender’s Revolving Credit Exposure hereunder up
to but not exceeding the amount, if any, set forth opposite such Lender’s name on Schedule
II, as the same may be reduced, increased or adjusted from time to time in accordance with this
Agreement, including Sections 2.3 and 2.9.

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     “Commitment Amount” means, on any date, $2,100,000,000, as such amount may be reduced,
increased or adjusted from time to time in accordance with this Agreement, including Sections
2.3 and 2.9.

     “Commitment Increase” is defined in Section 2.9(a).

     “Commitment Increase Effective Date” is defined in Section 2.9(b).

     “Consenting Lenders” is defined in Section 2.10(b).

     “Continuation/Conversion Notice” means a notice of continuation or conversion and
certificate duly executed by an Authorized Officer of the Borrower, substantially in the form of
Exhibit 2.6 hereto.

     “Controlled Group” means all members of a controlled group of corporations and all
members of a controlled group of trades or businesses (whether or not incorporated) under common
control which, together with the Borrower, are treated as a single employer under Section 414(b) or
414(c) of the Code or Section 4001 of ERISA.

     “Co-Syndication Agent” and “Co-Syndication Agents” are defined in the
preamble.

     “Debt” means the consolidated Indebtedness of the Borrower and its Subsidiaries.

     “Default” means any condition, occurrence or event which, after notice or lapse of
time or both, would constitute an Event of Default.

     “Default Margin” means two percent (2%).

     “Disclosure Schedule” means the Disclosure Schedule attached hereto as Schedule
I, as it may be amended, supplemented or otherwise modified from time to time by the Borrower
with the written consent of the Administrative Agent and the Required Lenders.

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

     “Domestic Office” means, relative to any Lender, the office of such Lender designated
as such in its Administrative Questionnaire or designated in the Lender Assignment Agreement or
such other office of a Lender (or any successor or assign of such Lender) within the United States
as may be designated from time to time by notice from such Lender, as the case may be, to each
other Person party hereto.

     “Effective Date” means the date on which the conditions specified in Section
5.1 are satisfied (or waived in accordance with Section 10.1).

     “Environmental Law” means any federal, state, or local statute, or rule or regulation
promulgated thereunder, any judicial or administrative order or judgment to which the Borrower or
any Subsidiary is party or which are applicable to the Borrower or any Subsidiary (whether or not
by consent), and any provision or condition of any governmental permit, license or other operating
authorization, relating to protection of the environment, persons or the public welfare

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from actual or potential exposure for the effects of exposure to any actual or potential
release, discharge, spill or emission (whether past or present) of, or regarding the manufacture,
processing, production, gathering, transportation, importation, use, treatment, storage or disposal
of, any chemical, raw material, pollutant, contaminant or toxic, corrosive, hazardous, or
non-hazardous substance or waste, including petroleum.

     “ERISA” means the Employee Retirement Income Security Act of 1974, as amended, and any
successor statute of similar import, together with the regulations thereunder, in each case as in
effect from time to time. References to sections of ERISA also refer to any successor sections.

     “Eurodollar Borrowing” means a borrowing hereunder consisting of the aggregate amount
of the several Eurodollar Loans made by all or some of the Lenders to the Borrower, at the same
time, at the same interest rate and for the same Interest Period.

     “Eurodollar Loan” means a Loan bearing interest, at all times during an Interest
Period applicable to such Loan, at a fixed rate of interest determined by reference to the
Eurodollar Rate.

     “Eurodollar Office” means, relative to any Lender, the office of such Lender
designated as such in its Administrative Questionnaire or designated in the Lender Assignment
Agreement or such other office of a Lender as designated from time to time by notice from such
Lender to the Borrower and the Administrative Agent, whether or not outside the United States,
which shall be making or maintaining Eurodollar Loans of such Lender hereunder.

     “Eurodollar Rate” means, relative to any Interest Period for Eurodollar Loans, the
rate per annum (rounded upwards, if necessary, to the nearest 1/16 of 1%) determined by the
Administrative Agent at approximately 11:00 a.m., London time, on the date that is two Business
Days prior to the commencement of the relevant Interest Period by reference to the British Bankers’
Association LIBOR Rates for deposits in Dollars (as set forth on Page 3750 of the Telerate Service
or any successor thereto or any other service selected by the Administrative Agent that has been
nominated by the British Bankers’ Association as an authorized information vendor for the purpose
of displaying such rates) for a period most closely approximating such Interest Period (and in an
amount equal to the amount of the relevant Eurodollar Loans); provided that in the event
the applicable Interest Period is not equal to a period of one, two, three, six, nine, or twelve
months, the Eurodollar Rate will be determined based on an Interest Period equal to the next longer
period of one, two, three, six, nine, or twelve months; and provided further that,
to the extent that an interest rate is not ascertainable pursuant to the foregoing provisions of
this definition at such time for any reason, then the “Eurodollar Rate” with respect to such
Eurodollar Loan for such Interest Period shall be the interest rate per annum determined by the
Administrative Agent to be the average of the rates per annum at which deposits in Dollars (in an
amount equal to the amount of the relevant Eurodollar Loans) are offered for such relevant Interest
Period to major banks in the London interbank market in London, England by the Administrative Agent
at approximately 11:00 a.m., London time, on the date that is two Business Days prior to the
commencement of such Interest Period.

     “Event of Default” is defined in Section 8.1.

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     “Existing Credit Agreement” is defined in the first recital.

     “Existing Lenders” is defined in the first recital.

     “Existing Loans” is defined in the first recital.

     “Extension Confirmation Date” is defined in Section 2.10(b).

     “Extension Effective Date” is defined in Section 2.10(b).

     “Extension Request” is defined in Section 2.10(a).

     “Facility” is defined in Section 2.1.

     “FAS 133” means the statement of financial accounting standard number 133 entitled
“Accounting for Derivative Instruments and Hedging Activities” issued by the Financial Accounting
Standards Board in June of 1998, as amended from time to time.

     “Federal Funds Rate” means, for any day, the average rate quoted to the Administrative
Agent at approximately 11:00 a.m. (Central time) on such day (or, if such day is not a Business
Day, on the next preceding Business Day) for overnight Federal Funds transactions arranged by New
York Federal Funds brokers selected by the Administrative Agent.

     “Fee Letter” is defined in Section 3.3.2.

     “Fiscal Quarter” means any quarter of a Fiscal Year.

     “Fiscal Year” means any period of twelve consecutive calendar months ending on
December 31.

     “Fitch” means Fitch, Inc. and any affiliate thereof and any successor thereto that is
a nationally-recognized rating agency.

     “F.R.S. Board” means the Board of Governors of the Federal Reserve System or any
successor thereto.

     “Funded Indebtedness” of any Person means Indebtedness of such Person referred to in
clauses (a), (b), (c), (d) and (e) of the definition of
“Indebtedness” in Section 1.1.

     “GAAP” is defined in Section 1.4.

     “Guaranteed Liability” means any agreement, undertaking or arrangement by which any
Person guarantees, endorses or otherwise becomes or is contingently liable upon (by direct or
indirect agreement, contingent or otherwise, to provide funds for payment, to supply funds to, or
otherwise to invest in, a debtor, or otherwise to assure a creditor against loss) the Indebtedness
of any other Person (other than by endorsements of instruments in the course of collection), or
guarantees the payment of dividends or other distributions upon the shares of any other Person.
The amount of any Person’s Guaranteed Liability shall be the lesser of (i) the limitation on such
Person’s liability, if any, set forth in such agreement, undertaking or arrangement or (ii) the

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outstanding principal amount of the Indebtedness guaranteed thereby. Guaranteed Liabilities
shall exclude any act or agreement in connection with any financing of a project owned by any
Person that either (A) guarantees performance of the acquisition, improvement, installation,
design, engineering, construction, development, completion, maintenance or operation of, or
otherwise affects any such act in respect of, all or a portion of the project that is financed,
except during any period, and then only to the extent, that such act or agreement is a guarantee of
payment of such financing or (B) the obligation to pay or perform under which is contingent upon
the occurrence of an event or condition which has not occurred, other than notice, the passage of
time or such financing or any part thereof becoming due; provided, however, to the
extent that any partial payment is required to be made under any such act or agreement providing
for a contingent payment obligation as described in clause (B) above, “Guaranteed Liability” shall
be deemed to include an amount equal to four (4) times such amount required to be paid during the
Fiscal Quarter most recently ended, up to the full amount of the Guaranteed Liability as specified
in the immediately preceding sentence.

     “Hazardous Material” means: (i) any “hazardous substance”, as defined by CERCLA; (ii)
any “hazardous waste”, as defined by the Resource Conservation and Recovery Act, as amended; (iii)
any petroleum, crude oil or any fraction thereof; (iv) any hazardous, dangerous or toxic chemical,
material, waste or substance within the meaning of any Environmental Law; (v) any radioactive
material, including any naturally occurring radioactive material, and any source, special or
by-product material as defined in 42 U.S.C. § 2011 et. seq., and any amendments or reauthorizations
thereof; (vi) asbestos-containing materials in any form or condition; or (vii) polychlorinated
biphenyls in any form or condition.

     “Hedging Obligations” means, with respect to any Person, all liabilities of such
Person under derivative contracts, including interest rate or commodity swap agreements, interest
rate or commodity cap agreements and interest rate or commodity collar agreements, and all similar
agreements or arrangements.

     “Herein”, “hereof”, “hereto”, “hereunder” and similar terms
contained in this Agreement or any other Loan Document refer to this Agreement or such other Loan
Document, as the case may be, as a whole and not to any particular Section, paragraph or provision
of this Agreement or such other Loan Document.

     “Impermissible Qualification” means, relative to the opinion or certification of any
independent public accountant as to any financial statement of the Borrower, any qualification or
exception to such opinion or certification (a) which is of a “going concern” or similar nature; (b)
which relates to the limited scope of examination of matters relevant to such financial statement;
or (c) which relates to the treatment or classification of any item in such financial statement and
which, as a condition to its removal, would require an adjustment to such item the effect of which
would be to cause the Borrower to be in default of any of its obligations under Section
7.2.3.

     “Including” means including without limiting the generality of any description
preceding such term.

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     “Indebtedness” of any Person means, without duplication: (a) all obligations of such
Person for borrowed money and all obligations of such Person evidenced by bonds, debentures, notes
or other similar instruments; (b) all obligations relative to banker’s acceptances issued for the
account of such Person; (c) all obligations of such Person as lessee under leases which have been
or should be, in accordance with GAAP, recorded as Capitalized Lease Liabilities; (d) all
obligations of such Person to pay the deferred purchase price of property or services (except
accounts payable arising in the ordinary course of business), (e) Indebtedness of another Person of
the type described in clauses (a), (b), (c) or (d) above secured by
a Lien on property owned or being purchased by such Person (including indebtedness arising under
conditional sales or other title retention agreements), whether or not such Indebtedness shall have
been assumed by such Person or is limited in recourse (such Indebtedness being the lesser of (i)
the value of such property on the books of such Person or (ii) the outstanding principal amount of
such Indebtedness); and (f) all Guaranteed Liabilities of such Person in respect of any of the
foregoing. For all purposes of this Agreement, the Indebtedness of any Person shall include the
Indebtedness of any partnership or joint venture in which such Person is a general partner or a
joint venturer except to the extent that such Indebtedness by its terms is expressly non-recourse
to such general partner or joint venturer.

     “Indemnified Liabilities” is defined in Section 10.4.

     “Indemnified Parties” is defined in Section 10.4.

     “Information” is defined in Section 10.12.

     “Interest Period” means, with respect to Eurodollar Borrowings, the period beginning
on (and including) the date on which such Eurodollar Borrowing is made or continued as, or
converted into, a Eurodollar Borrowing pursuant to Section 2.5 or 2.6 and shall end
on (but exclude) the day which numerically corresponds to such date one, two, three, six, nine or
twelve months thereafter (or, if such month has no numerically corresponding day, on the last
Business Day of such month), or such other time period acceptable to each Lender, in each case, as
the Borrower may select in its relevant notice pursuant to Section 2.5, provided,
however, that (a) the Borrower shall not be permitted to select Interest Periods to be in
effect at any one time which have expiration dates occurring on more than ten different dates; (b)
if such Interest Period would otherwise end on a day which is not a Business Day, such Interest
Period shall end on the next following Business Day (unless, if such Interest Period applies to
Eurodollar Loans, such next following Business Day is the first Business Day of a calendar month,
in which case such Interest Period shall end on the Business Day next preceding such numerically
corresponding day); and (c) no Interest Period may end later than the Maturity Date.

     “Issuing Bank” means (a) JPMorgan Chase Bank, N.A. in its capacity as the issuer of
Letters of Credit hereunder, and its successors in such capacity as provided in Section
2.11(i), as well as (b) any other Lender that, at the request of the Borrower, agrees, in such
Lender’s discretion, to become an Issuing Bank for purposes of issuing Letters of Credit pursuant
to Section 2.11; provided that JPMorgan Chase Bank, N.A. shall at no time be requested or
otherwise required to issue Letters of Credit with an aggregate LC Exposure in excess of
$300,000,000. An Issuing Bank may, with the prior written consent of the Borrower (such consent
not to be unreasonably withheld, conditioned or delayed), arrange for one or more

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Letters of Credit to be issued by Affiliates of such Issuing Bank, in which case the term
“Issuing Bank” shall include any such Affiliate with respect to Letters of Credit issued by such
Affiliate.”

     “JPMCB” is defined in the preamble, and includes its successors and assigns.

     “Law” means any law (including, without limitation, any zoning law or ordinance or any
Environmental Law), statute, rule, regulation, ordinance, order, directive, code, interpretation,
judgment, decree, injunction, writ, determination, award, permit, license, authorization,
direction, requirement or decision of and agreement with or by any government or governmental
department, commission, board, court, authority, agency, official or officer, domestic or foreign.

     “LC Disbursement” means a payment made by the Issuing Bank pursuant to a Letter of
Credit.

     “LC Exposure” means, at any time, the sum of (a) the aggregate undrawn amount of all
outstanding Letters of Credit at such time plus (b) the aggregate amount of all LC Disbursements
that have not yet been reimbursed by or on behalf of the Borrower at such time. The LC Exposure of
any Lender at any time shall be its Percentage of the total LC Exposure at such time.

     “Lender Affiliate” means, (a) with respect to any Lender, (i) an Affiliate of such
Lender or (ii) any entity (whether a corporation, partnership, trust or otherwise) that is engaged
in making, purchasing, holding or otherwise investing in bank loans and similar extensions of
credit in the ordinary course of its business and is administered or managed by a Lender or an
Affiliate of such Lender and (b) with respect to any Lender that is a fund which invests in bank
loans and similar extensions of credit, any other fund that invests in bank loans and similar
extensions of credit and is managed by the same investment advisor as such Lender or by an
Affiliate of such investment advisor.

     “Lender Assignment Agreement” means a Lender Assignment Agreement substantially in the
form of Exhibit 10.10 hereto.

     “Lender Certificate” is defined in Section 2.9.

     “Lenders” means the financial institutions listed on the signature pages hereto and
their respective successors and assigns in accordance with Section 10.10 (including any
commercial lending institution becoming a party hereto pursuant to a Lender Assignment Agreement)
or otherwise by operation of law. Unless the context otherwise requires, the term
“Lenders” shall include the Swingline Lender.

     “Letter of Credit” means any letter of credit issued pursuant to this Agreement or
letter of credit listed on Schedule III hereto.

     “Lien” means any security interest, mortgage, pledge, hypothecation, assignment,
deposit arrangement, encumbrance, lien (statutory or otherwise), charge against or interest in
property to secure payment of a debt or the performance of an obligation.

     “Loans” means the loan made by the Lenders to the Borrower pursuant to this Agreement,
including, without limitation, Revolving Loans and Swingline Loans.

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     “Loan Advances” means the Loans of the same Type and, in the case of Eurodollar Loans,
having the same Interest Period made by all Lenders on the same Business Day and pursuant to the
same Borrowing Request in accordance with Section 2.1.

     “Loan Documents” means this Agreement, each Borrowing Request, each Borrowing Notice,
the Fee Letter, any note, any Letter of Credit or related document, together in each case with all
exhibits, schedules and attachments thereto, and all other agreements and instruments from time to
time executed and delivered by the Borrower or any of its Subsidiaries pursuant to or in connection
with any of the foregoing.

     “Margin Stock” means “margin stock” within the meaning of Regulation U.

     “Material Adverse Effect” means a material adverse effect on (i) the business,
property, financial condition or results of operations of the Borrower and its consolidated
Subsidiaries (taken as a whole) or (ii) the ability of the Borrower to perform its payment
obligations under any of the Loan Documents.

     “Maturity Date” shall mean the earlier of:

     (a) December 9, 2011, and for any Lender agreeing to extend its Maturity Date pursuant to
Section 2.10, the date on December 9th, in each year thereafter pursuant to which the
Maturity Date of such Lender has been extended; and

     (b) the date on which the Commitment Amount is terminated in full or reduced to zero pursuant
to the terms of Section 2.3;

     (c) the date on which the Commitments are terminated in full and reduced to zero pursuant to
the terms of Article VIII; and

     (d) the date on which the Obligations have become due and payable in full pursuant to the
terms of Article VIII.

     “Moody’s” means Moody’s Investors Service, Inc. and any successor thereto that is a
nationally-recognized rating agency.

     “New Funds Amount” is defined in Section 2.9(d).

     “Non-Consenting Lender” is defined in Section 2.10(a).

     “Notice of Commitment Increase” is defined in Section 2.9(b).

     “Obligations” means all obligations (monetary or otherwise) of the Borrower, including
any Revolving Credit Exposure, arising under or in connection with this Agreement and each other
Loan Document.

     “Organic Document” means, relative to the Borrower, its certificate of incorporation,
its by-laws and all shareholder agreements, voting trusts and similar arrangements applicable to
any of its authorized shares of capital stock.

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     “Participant” is defined in Section 10.10.

     “Payment Date” is defined in Section 3.2.3.

     “Payment Office” means the principal office of the Administrative Agent, presently
located at JPMorgan Chase Bank, N.A., Agency Services, 1111 Fannin Street, 10th Floor,
Houston, Texas 77002, Attention: Rose Salvacion.

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

     “Pension Plan” means a “pension plan”, as such term is defined in section 3(2) of
ERISA, which is subject to Title IV of ERISA (other than a multiemployer plan as defined in section
4001(a)(3) of ERISA), and to which the Borrower or any corporation, trade or business that is,
along with the Borrower, a member of a Controlled Group, may have liability, including any
liability by reason of having been a substantial employer within the meaning of section 4063 of
ERISA at any time during the preceding five years, or by reason of being deemed to be a
contributing sponsor under section 4069 of ERISA.

     “Percentage” means, with respect to any Lender, the percentage of the Total
Commitments represented by such Lender’s Commitment, as such percentage may be adjusted from time
to time pursuant to Lender Assignment Agreements executed by such Lender and its Assignee Lenders
and delivered pursuant to Section 10.10, or any decreases in Commitments made in accordance
with this Agreement, or as such percentage may be adjusted from time to time pursuant to
Section 2.9. If the Commitments have terminated or expired, the Percentages shall be
determined based upon the Commitments most recently in effect, giving effect to any assignments or
other adjustments.

     “Person” means any natural person, corporation, partnership, firm, association, trust,
government, governmental agency or any other entity, whether acting in an individual, fiduciary or
other capacity.

     “Plan” means any Pension Plan or Welfare Plan.

     “Prior Indebtedness” is defined in the eighth recital.

     “Quarterly Payment Date” means the last day of each March, June, September, and
December or, if any such day is not a Business Day, the next succeeding Business Day.

     “Rating Agency” means either of S&P or Moody’s.

     “Reducing Percentage Lender” is defined in Section 2.9(d).

     “Reduction Amount” is defined in Section 2.9(d).

     “Regulation U” means any of Regulations T, U or X of the Board of Governors of the
Federal Reserve System of the United States of America (the “Board”) from time to time in
effect and shall include any successor or other regulations or official interpretations of the
Board

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or any successor Person relating to the extension of credit for the purpose of purchasing or
carrying Margin Stock and which is applicable to member banks of the Federal Reserve System or any
successor Person.

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

     “Release” means a “release”, as such term is defined in CERCLA.

     “Required Lenders” means Lenders in the aggregate holding greater than 50% of the
aggregate amount of the Revolving Credit Exposures of all Lenders and, if there is no Revolving
Credit Exposure, Lenders having greater than 50% of the then Total Commitment.

     “Resource Conservation and Recovery Act” means the Resource Conservation and Recovery
Act, 42 U.S.C. Section 690, et seq., as in effect from time to time.

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

     “Revolving Credit Exposure” means, with respect to any Lender at any time, the sum of
the outstanding principal amount of such Lender’s Revolving Loans and its LC Exposure and Swingline
Exposure at such time.

     “Revolving Loans” shall mean the loans provided for in Section 2.1.1 hereof.

     “S&P” means Standard & Poor’s Ratings Group and any successor thereto that is a
nationally-recognized rating agency.

     “Stockholders’ Equity” means, as of the time of any determination thereof is to be
made, (a) shareholders’ equity of the Borrower and its consolidated Subsidiaries determined in
accordance with GAAP, plus (b) the absolute cumulative amount by which such shareholders’
equity shall have been reduced by reason of non-cash write downs of oil and gas assets from time to
time after the Effective Date and (c) either plus the absolute amount by which such
shareholders’ equity shall have been reduced by reason of any non-cash accumulated comprehensive
loss or minus the absolute amount by which such shareholders’ equity shall have been
increased by reason of any non-cash accumulated comprehensive gain, in either case from changes in
fair value of hedges, net of tax, resulting from the requirements of FAS 133.

     “Subsidiary” means any subsidiary of the Borrower.

     “subsidiary” means, with respect to any Person, (a) any corporation, limited liability
company or other business entity of which more than 50% of the outstanding equity interests having
ordinary voting power to elect a majority of the board of directors (or persons performing similar
functions) of such corporation, limited liability company or other business entity (irrespective of
whether at the time equity interests of any other class or classes of such corporation, limited
liability company or other business entity shall or might have voting power upon the occurrence of
any contingency) is at the time directly or indirectly owned by such Person, by such Person and one
or more other Subsidiaries of such Person, or by one or more

15

 

other Subsidiaries of such Person and (b) any partnership of which such Person, such Person
and one or more other Subsidiaries of such Person, or one or more other Subsidiaries of such Person
holds more than 50% of the outstanding general partner interests.

     “Swingline Exposure” means, at any time, the aggregate principal amount of all
Swingline Loans outstanding at such time. The Swingline Exposure of any Lender at any time shall
be its Percentage of the total Swingline Exposure at such time.

     “Swingline Lender” means JPMCB, in its capacity as lender of Swingline Loans
hereunder.

     “Swingline Loan” shall mean the loans provided for in Section 2.1.2 hereof.

     “Taxes” is defined in Section 4.6.

     “Total Commitment” means the aggregate of all the Lenders’ Commitments.

     “Total Debt to Capitalization Ratio” means the ratio of (a) Debt to (b)
Capitalization.

     “Type” means, relative to any Loan, the portion thereof, if any, being maintained as a
Base Rate Loan or a Eurodollar Loan.

     “United States” or “U.S.” means the United States of America, its fifty States
and the District of Columbia.

     “Unrestricted Subsidiary” means any Subsidiary that is designated on Schedule
6.8 as an Unrestricted Subsidiary or which the Borrower has designated in writing to the
Administrative Agent to be an Unrestricted Subsidiary pursuant to Section 7.1.7, and, in
either case, which the Borrower has not designated to be a Restricted Subsidiary pursuant to
Section 7.1.8.

     “USA Patriot Act” means Title III of Pub. L. 107-56 (signed into law October 26,
2001), as amended, reformed or otherwise modified from time to time.

     “Utilization” means, at any time, the ratio (expressed as a percentage) of (i) the
aggregate amount of the Revolving Credit Exposures of all Lenders to (ii) the sum of the then
effective Total Commitment under this Agreement.

     “Welfare Plan” means a “welfare plan”, as such term is defined in section 3(1) of
ERISA.

     SECTION 1.2 Use of Defined Terms. Unless otherwise defined or the context otherwise
requires, terms for which meanings are provided in this Agreement shall have such meanings when
used in the Disclosure Schedule and in each Borrowing Request, Continuation/Conversion Notice,
notice and other communication delivered from time to time in connection with this Agreement or any
other Loan Document.

     SECTION 1.3 Cross-References. Unless otherwise specified, references in this
Agreement and in each other Loan Document to any Article or Section are references to such Article
or Section of this Agreement or such other Loan Document, as the case may be, and,

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unless otherwise specified, references in any Article, Section or definition to any clause are
references to such clause of such Article, Section or definition.

     SECTION 1.4 Accounting and Financial Determinations. Unless otherwise specified, all
accounting terms used herein or in any other Loan Document shall be interpreted, all accounting
determinations and computations hereunder or thereunder (including under Section 7.2.3)
shall be made, and all financial statements required to be delivered hereunder or thereunder shall
be prepared in accordance with, those generally accepted accounting principles (“GAAP”)
applied in the preparation of the financial statements referred to in Section 6.5.

ARTICLE II

THE FACILITY AND BORROWING PROCEDURES

     SECTION 2.1 Facility. The Lenders grant to the Borrower a credit facility (the
“Facility”) pursuant to which, and upon the terms and subject to the conditions herein set
out and provided that no Default or Event of Default has occurred and is continuing from time to
time on any Business Day, (a) each Lender severally agrees (i) to make Revolving Loans in U.S.
Dollars to the Borrower equal to such Lender’s Percentage of the aggregate amount of Revolving
Loans requested by the Borrower to be made on such day, (ii) to participate in Letters of Credit,
and (iii) to participate in Swingline Loans, and (b) the Swingline Lender agrees to make Swingline
Loans in U.S. Dollars to the Borrower equal to the aggregate amount of Swingline Loans requested by
the Borrower to be made on such day.

     SECTION 2.1.1 Revolving Loans. From time to time during the Availability Period, each
Lender shall make Revolving Loans under this Section to the Borrower in an aggregate principal
amount at any one time outstanding up to but not exceeding such Lender’s Commitment;
provided, however, that at no time shall the aggregate amount of the Revolving
Credit Exposure of such Lender exceed the Lender’s Commitment. Subject to the conditions herein,
any such Revolving Loan repaid prior to the Maturity Date may be reborrowed pursuant to the terms
of this Agreement.

     SECTION 2.1.2 Swingline Loans. Subject to the terms and conditions set forth herein,
the Swingline Lender shall make Swingline Loans under this Section to the Borrower from time to
time during the Availability Period, in an aggregate principal amount at any time outstanding that
will not result in (i) the aggregate principal amount of outstanding Swingline Loans exceeding
$300,000,000 or (ii) the sum of the total Revolving Credit Exposures exceeding the total
Commitments; provided that the Swingline Lender shall not be required to make a Swingline
Loan to refinance an outstanding Swingline Loan. Within the foregoing limits and subject to the
conditions herein, any such Swingline Loan repaid prior to the Maturity Date may be reborrowed
pursuant to the terms of this Agreement.

     SECTION 2.1.3 Availability of Facility. No Lender shall be permitted or required to
make (i) any Loan if, after giving effect thereto, the aggregate amount of the Revolving Credit
Exposures of all Lenders would exceed the Commitment Amount, or (ii) any Loan if, after giving
effect thereto, the aggregate amount of the Revolving Credit Exposure of such Lender would exceed
the Lender’s Commitment.

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     SECTION 2.2 Mandatory Reductions of Commitment Amount. The Commitment of each Lender
shall be reduced automatically to zero ($0) on the Maturity Date applicable to such Lender.

     SECTION 2.3 Voluntary Reduction of Commitment Amount. The Borrower may, from time to
time on any Business Day occurring after the Effective Date, voluntarily reduce the amount of the
Commitment Amount; provided, however, that all such reductions shall require at
least three Business Days’ prior notice to the Administrative Agent and be permanent, and any
partial reduction of the Commitment Amount shall be in a minimum amount of $10,000,000 and in an
integral multiple of $1,000,000; and provided further that the Borrower shall not
reduce the Commitment Amount if, after giving effect to any concurrent prepayment of the Loans in
accordance with Section 3.1, the aggregate amount of the Revolving Credit Exposures of all
Lenders will exceed the Total Commitments.

     SECTION 2.4 Base Rate Loans; Eurodollar Loans; Swingline Loans. Subject to the terms
and conditions set forth in Article V, (a) each Revolving Loan shall be either a Eurodollar
Loan or a Base Rate Loan as the Borrower may request, it being understood that Revolving Loans made
to the Borrower on any date may be either Eurodollar Loans or Base Rate Loans or a combination
thereof and (b) each Swingline Loan shall be either a Base Rate Loan or an ASK Rate Loan as the
Borrower may request, it being understood that Swingline Loans made to the Borrower on any date may
be either Base Rate Loans or ASK Rate Loans or a combination thereof. As to any Eurodollar Loan,
each Lender may, if it so elects, fulfill its commitment to make such Eurodollar Loan by causing
its Eurodollar Office to make such Eurodollar Loan; provided, however, that in such
event the obligation of the Borrower to repay such Eurodollar Loan nevertheless shall be to such
Lender and shall be deemed to be held by such Lender for the account of such Eurodollar Office.

     SECTION 2.5 Borrowing Procedures for Loans. The Borrower shall give the
Administrative Agent prior written or telegraphic notice pursuant to a Borrowing Request (in
substantially the form of Exhibit 2.5 hereto) of each proposed Borrowing or continuation,
and as to whether such Borrowing or continuation is to be of Base Rate Loans or Eurodollar Loans,
as follows:

     SECTION 2.5.1 Base Rate Loans. The Administrative Agent shall receive written or
telegraphic notice from the Borrower on or before 2:00 p.m. Central time one (1) Business Day prior
to the date of the Borrowing of a Base Rate Loan (provided that any such notice of the Borrowing of
a Base Rate Loan to finance the reimbursement of an LC Disbursement as contemplated by Section
2.11(e) may be given not later than 10:00 a.m., Central time, on the date of the proposed
Borrowing) and the amount of such Borrowing (which shall be in a minimum amount of $5,000,000 and
an integral multiple of $1,000,000 unless such Borrowing is required to finance the reimbursement
of an LC Disbursement as contemplated by Section 2.11(e)), and the Administrative Agent
shall advise each Lender thereof promptly thereafter. Not later than 11:00 a.m., Central time, on
the date specified in such notice for such Borrowing, each Lender shall provide to the
Administrative Agent at the Payment Office, same day or immediately available funds covering such
Lender’s Percentage of the requested Base Rate Loan. Upon fulfillment of the applicable conditions
set forth in Article V with respect to such Base Rate Loan, the Administrative Agent shall
make available to the Borrower the

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proceeds of
each Base Rate Loan (to the extent received from the Lenders) by wire transfer of such
proceeds to such account(s) as the Borrower shall have specified in the Borrowing Request.

     SECTION 2.5.2 Eurodollar Loans. The Administrative Agent shall receive written or
telegraphic notice pursuant to a Borrowing Request from the Borrower on or before 2:00 p.m. Central
time, at least three (3) Business Days prior to the date requested for each proposed Borrowing or
continuation of a Eurodollar Loan, of the date of such Borrowing or continuation, as the case may
be, the amount of such Borrowing or continuation, as the case may be (which shall be in a minimum
amount of $5,000,000 and an integral multiple of $1,000,000), and the duration of the initial
Eurodollar Interest Period with respect thereto, and the Administrative Agent shall advise each
Lender thereof promptly thereafter. Not later than 10:00 a.m., Central time, on the date specified
in such notice for such Borrowing, each Lender shall provide to the Administrative Agent at the
Payment Office, same day or immediately available funds covering such Lender’s Percentage of the
requested Eurodollar Loan. Upon fulfillment of the applicable conditions set forth in Article
V with respect to such Eurodollar Loan, the Administrative Agent shall make available to the
Borrower the proceeds of each Eurodollar Loan (to the extent received from the Lenders) by wire
transfer of such proceeds to such account(s) as the Borrower shall have specified in the Borrowing
Request.

     SECTION 2.5.3 Swingline Loans.

     (a) The Administrative Agent shall receive written or telegraphic notice from the Borrower on
or before 2:00 p.m. Central time on the day of the proposed Swingline Loan and the amount of such
Borrowing (which shall be in a minimum amount of $5,000,000 and an integral multiple of
$1,000,000), and the Administrative Agent shall advise the Swingline Lender thereof promptly
thereafter. Each such notice shall be irrevocable and shall specify the requested date (which
shall be a Business Day), the amount of the requested Swingline Loan and whether the Swingline Loan
will be a Base Rate Loan or a ASK Rate Loan. Not later than 3:00 p.m., Central time, on the date
specified in such notice for such Borrowing, the Swingline Lender shall provide to the
Administrative Agent at the Payment Office, same day or immediately available funds covering the
requested Swingline Loan. Upon fulfillment of the applicable conditions set forth in Article
V with respect to such Swingline Loan, the Administrative Agent shall make available to the
Borrower the proceeds of such Swingline Loan (to the extent received from the Swingline Lender) by
wire transfer of such proceeds to such account(s) as the Borrower shall have specified in the
Borrowing Request.

     (b) The Swingline Lender may by written notice given to the Administrative Agent not later
than 10:00 a.m., Central time, on any Business Day require the Lenders to acquire participations on
such Business Day in all or a portion of the Swingline Loans outstanding. Such notice shall
specify the aggregate amount of Swingline Loans in which Lenders will participate. Promptly upon
receipt of such notice, the Administrative Agent will give notice thereof to each Lender,
specifying in such notice such Lender’s Percentage of such Swingline Loan or Loans. Each Lender
hereby absolutely and unconditionally agrees, upon receipt of notice as provided above, to pay to
the Administrative Agent, for the account of the Swingline Lender, such Lender’s Percentage of such
Swingline Loan or Loans. Each Lender acknowledges and agrees that its obligation to acquire
participations in Swingline Loans pursuant to this paragraph is absolute and unconditional and
shall not be affected by any circumstance whatsoever, including

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the occurrence and continuance of a Default or reduction or termination of the Commitments,
and that each such payment shall be made without any offset, abatement, withholding or reduction
whatsoever. Each Lender shall comply with its obligation under this paragraph by providing to the
Administrative Agent at the Payment Office, same day or immediately available funds covering such
Lender’s Percentage of such Swingline Loan or Loans. Administrative Agent shall promptly pay to
the Swingline Lender the amounts so received by it from the Lenders. The Administrative Agent
shall notify the Borrower of any participations in any Swingline Loan acquired pursuant to this
paragraph, and thereafter payments in respect of such Swingline Loan shall be made to the
Administrative Agent and not to the Swingline Lender. Any amounts received by the Swingline Lender
from the Borrower (or other party on behalf of the Borrower) in respect of a Swingline Loan after
receipt by the Swingline Lender of the proceeds of a sale of participations therein shall be
promptly remitted to the Administrative Agent; any such amounts received by the Administrative
Agent shall be promptly remitted by the Administrative Agent to the Lenders that shall have made
their payments pursuant to this paragraph and to the Swingline Lender, as their interests may
appear; provided that any such payment so remitted shall be repaid to the Swingline Lender or to
the Administrative Agent, as applicable, if and to the extent such payment is required to be
refunded to the Borrower for any reason. The purchase of participations in a Swingline Loan
pursuant to this paragraph shall not relieve the Borrower of any default in the payment thereof.

     SECTION 2.6 Continuation and Conversion Elections. By delivering a
Continuation/Conversion Notice to the Administrative Agent on or before 2:00 p.m., Central time, on
a Business Day, the Borrower may from time to time irrevocably elect, on not less than three (3)
nor more than five (5) Business Days’ notice that all, or any portion in an aggregate minimum
amount of $5,000,000 and an integral multiple of $1,000,000 of any Borrowings be, (i) in the case
of Base Rate Loans, converted into Eurodollar Loans, or (ii) in the case of Eurodollar Loans, be
converted into a Base Rate Loan or continued as a Eurodollar Loan of such Type (in the absence of
delivery of a Continuation/Conversion Notice with respect to any Eurodollar Loan at least three (3)
Business Days before the last day of the then current Interest Period with respect thereto, such
Eurodollar Loan shall, on such last day, automatically convert to a Base Rate Loan);
provided, however, that (i) each such conversion or continuation shall be pro rated
among the applicable outstanding Loans of all Lenders, and (ii) no portion of the outstanding
principal amount of any Loans may be continued as, or be converted into, Eurodollar Loans when any
Event of Default has occurred and is continuing. This Section shall not apply to Swingline Loans
or Borrowings, which may not be converted or continued.

     SECTION 2.7 Funding. Each Lender may, if it so elects, fulfill its obligation to
make, continue or convert Eurodollar Loans hereunder by causing one of its foreign branches or
Affiliates (or an international banking facility created by such Lender) to make or maintain such
Eurodollar Loan; provided, however, that such Eurodollar Loan shall nonetheless be
deemed to have been made and to be held by such Lender, and the obligation of the Borrower to repay
such Eurodollar Loan shall nevertheless be to such Lender for the account of such foreign branch,
Affiliate or international banking facility. In addition, the Borrower hereby consents and agrees
that, for purposes of any determination to be made for purposes of Sections 4.1,
4.2, 4.3 or 4.4, it shall be conclusively assumed that each Lender elected
to fund all Eurodollar Loans by purchasing, as the case may be, Dollar deposits in its Eurodollar
Office’s interbank eurodollar market.

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     SECTION 2.8 Repayment of Loans; Evidence of Debt.

     (a) The Borrower hereby unconditionally promises to pay to the Administrative Agent for the
account of each Lender the then unpaid principal amount of each Revolving Loan on the Maturity
Date.

     (b) The Borrower hereby unconditionally promises to pay to the Administrative Agent for the
account of the Swingline Lender the then unpaid principal amount of each Swingline Loan on the
earlier to occur of (i) the Maturity Date and (ii) the date which is 15 days after such Swingline
Loan was made; provided that on each date that a Revolving Borrowing is made, the Borrower
shall repay all Swingline Loans then outstanding.

     (c) Each Lender shall maintain in accordance with its usual practice an account or accounts
evidencing the indebtedness of the Borrower to such Lender resulting from each Loan made by such
Lender, including the amounts of principal and interest payable and paid to such Lender from time
to time hereunder.

     (d) The Administrative Agent shall maintain accounts in which it shall record (i) the amount
of each Loan made hereunder and the Interest Period applicable thereto, if any, (ii) the amount of
any principal or interest due and payable or to become due and payable from the Borrower to each
Lender hereunder and (iii) the amount of any sum received by the Administrative Agent hereunder for
the account of the Lenders and each Lender’s share thereof.

     (e) The entries made in the accounts maintained pursuant to paragraph (b) or (c) of this
Section shall be prima facie evidence of the existence and amounts of the
obligations recorded therein; provided that the failure of any Lender or the Administrative
Agent to maintain such accounts or any error therein shall not in any manner affect the obligation
of the Borrower to repay the Loans in accordance with the terms of this Agreement.

     (f) Any Lender may request that Loans made by it be evidenced by a promissory note, in
substantially the form attached as Exhibit 2.8 hereto. In such event, the Borrower shall
prepare, execute and deliver to such Lender a promissory note payable to the order of such Lender
(or, if requested by such Lender, to such Lender and its registered assigns) and in a form approved
by the Administrative Agent. Thereafter, the Loans evidenced by such promissory note and interest
thereon shall at all times (including after assignment pursuant to Section 10.10.1) be
represented by one or more promissory notes in such form payable to the order of the payee named
therein (or, if such promissory note is a registered note, to such payee and its registered
assigns).

     SECTION 2.9 Increase in Commitments.

     (a) Subject to the terms and conditions set forth herein, the Borrower shall have the right,
without the consent of the Lenders, the Administrative Agent or the Issuing Banks, to cause from
time to time an increase in the total amount of the Commitments (a “Commitment Increase”)
by adding to this Agreement one or more additional financial institutions that are not already
Lenders hereunder and that are reasonably satisfactory to the Administrative Agent and the Issuing
Banks (each a “CI Lender”) or by allowing one or more existing Lenders to increase their
respective Commitments; provided, however, that (i) no Event of Default shall have

21

 

occurred which is continuing, (ii) no such Commitment Increase shall cause the total amount of
the Commitments to exceed $3,000,000,000, (iii) no Lender’s Commitment shall be increased without
such Lender’s prior written consent (which consent may be given or withheld in such Lender’s sole
and absolute discretion) and (iv) if, on the effective date of such increase, any Loans have been
funded, then the Borrower shall be obligated to pay any breakage fees or costs in connection with
the reallocation of such outstanding Loans.

     (b) Any Commitment Increase must be requested by written notice from the Borrower to the
Administrative Agent (a “Notice of Commitment Increase”) in the form of Exhibit 2.9
attached hereto. The Administrative Agent shall give prompt notice to each Issuing Bank of its
receipt of a Notice of Commitment Increase. Once the Notice of Commitment Increase is
fully-executed, such notice and such Commitment Increase shall be effective on the proposed
effective date set forth in such notice or on another date agreed to by the Administrative Agent
and the Borrower (such date referred to as the “Commitment Increase Effective Date”).

     (c) On each Commitment Increase Effective Date, to the extent that there are Loans outstanding
as of such date, (i) each CI Lender shall, by wire transfer of immediately available funds, deliver
to the Administrative Agent such CI Lender’s New Funds Amount, which amount, for each such CI
Lender, shall constitute Loans made by such CI Lender to the Borrower pursuant to this Agreement on
such Commitment Increase Effective Date, (ii) the Administrative Agent shall, by wire transfer of
immediately available funds, pay to each then Reducing Percentage Lender its Reduction Amount,
which amount, for each such Reducing Percentage Lender, shall constitute a prepayment by the
Borrower pursuant to Section 2.3, ratably in accordance with the respective principal
amounts thereof, of the principal amounts of all then outstanding Loans of such Reducing Percentage
Lender, and (iii) the Borrower shall be responsible to pay to each Lender any breakage fees or
costs in connection with the reallocation of any outstanding Loans.

     (d) For purposes of this Section, the following defined terms shall have the following
meanings: (1) “New Funds Amount” means the amount equal to the product of a Lender’s
increased Commitment or a CI Lender’s Commitment (as applicable) represented as a percentage of the
total amount of the Commitments after giving effect to the Commitment Increase, times the aggregate
principal amount of the outstanding Loans immediately prior to giving effect to the Commitment
Increase, if any, as of a Commitment Increase Effective Date (without regard to any increase in the
aggregate principal amount of Loans as a result of borrowings made after giving effect to the
Commitment Increase on such Commitment Increase Effective Date); (2) “Reducing Percentage
Lender” means each then existing Lender immediately prior to giving effect to the Commitment
Increase that does not increase its respective Commitment as a result of the Commitment Increase
and whose relative percentage of the total amount of the Commitments shall be reduced after giving
effect to such Commitment Increase; and (3) “Reduction Amount” means the amount by which a
Reducing Percentage Lender’s outstanding Loans decrease as of a Commitment Increase Effective Date
(without regard to the effect of any borrowings made on such Commitment Increase Effective Date
after giving effect to the Commitment Increase).

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     (e) Each Commitment Increase shall become effective on its Commitment Increase Effective Date
and upon such effectiveness (i) the Administrative Agent shall record in its records the CI
Lender’s information as provided in the Notice of Commitment Increase and pursuant to an
Administrative Questionnaire in form satisfactory to the Administrative Agent that shall be
executed and delivered by each CI Lender to the Administrative Agent on or before the Commitment
Increase Effective Date, (ii) Schedule II hereof shall be amended and restated to set forth
all Lenders (including any CI Lenders) that will be Lenders hereunder after giving effect to such
Commitment Increase (which shall be set forth in Annex I to the applicable Notice of Commitment
Increase) and the Administrative Agent shall distribute to each Lender (including each CI Lender) a
copy of such amended and restated Schedule II, and (iii) each CI Lender identified on the
Notice of Commitment Increase for such Commitment Increase shall be a “Lender” for all purposes
under this Agreement.

     SECTION 2.10 Extension of Maturity Date.

     (a) Not earlier than 90 days prior to, nor later than 30 days prior to, each anniversary of
the Closing Date, the Borrower may, upon notice to the Administrative Agent (who shall promptly
notify the Lenders), request a one-year extension of the Maturity Date then in effect
(“Extension Request”). Within 15 days of delivery of such Extension Request, each Lender
shall notify the Administrative Agent and the Borrower whether or not it consents to such Extension
Request (which consent may be given or withheld in such Lender’s sole and absolute discretion).
Any Lender with a then effective Commitment may consent to an Extension Request irrespective of
whether such Lender previously had not been a Consenting Lender (as defined below) with respect to
a previous Extension Request (a “Non-Consenting Lender”). Any Lender not responding within
the above specified time period shall be deemed not to have consented to such Extension Request.
The Administrative Agent shall promptly notify the Borrower and the Lenders of the Lenders’
responses.

     (b) The Maturity Date shall be extended only if Lenders holding greater than 50% of the total
Commitments then outstanding (calculated excluding any Lender in default in its obligation to fund
Loans hereunder and prior to giving effect to any replacements of Lenders permitted herein) (the
“Consenting Lenders”) have consented to the Extension Request. For each such Extension
Request, if so approved, (i) the Maturity Date, as to Consenting Lenders (irrespective of whether
such Lender previously had been a Non-Consenting Lender), shall be extended to the same date in the
following year after giving effect to any prior extensions (such existing Maturity Date being the
“Extension Effective Date”), and (ii) the Maturity Date, as to any Non-Consenting Lender,
shall remain the Maturity Date in effect for such Non-Consenting Lender prior to the Extension
Effective Date. With respect to any previously Non-Consenting Lender who is a Consenting Lender
with respect to a current Extension Request, by giving its consent, such Consenting Lender shall be
approving an extension of more than one year. Non-Consenting Lenders shall remain Lenders until
the Maturity Date applicable to such Lender at which time (and irrespective of the pro rata
requirements under Sections 4.8 and 4.9 hereof) the Borrower shall repay all Loans
owing to such Lender. The Administrative Agent and the Borrower shall promptly confirm to the
Lenders such extension of the Maturity Date, specifying the date of such confirmation (the
“Extension Confirmation Date”), the Extension Effective Date, and the extended Maturity
Date with respect to the Consenting Lenders. As a condition precedent to such extension, the
Borrower shall deliver to the Administrative Agent a certificate

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of the Borrower dated as of the Extension Confirmation Date signed by an Authorized Officer of
the Borrower certifying that, (i) before and after giving effect to such extension, the
representations and warranties contained in Article VI made by it are true and correct on
and as of the Extension Confirmation Date, except to the extent that such representations and
warranties specifically refer to an earlier date, (ii) before and after giving effect to such
extension no Default exists or will exist as of the Extension Confirmation Date, and (iii) no
Material Adverse Effect has occurred through the Extension Confirmation Date.

     SECTION 2.11 Letters of Credit.

     (a) General. Subject to the terms and conditions set forth herein, the Borrower may
request the issuance of Letters of Credit for its own account, in a form reasonably acceptable to
the applicable Issuing Bank, at any time and from time to time during the Availability Period. In
the event of any inconsistency between the terms and conditions of this Agreement and the terms and
conditions of any form of letter of credit application or other agreement submitted by the Borrower
to, or entered into by the Borrower with, the applicable Issuing Bank relating to any Letter of
Credit, the terms and conditions of this Agreement shall control.

     (b) Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions. To request
the issuance of a Letter of Credit (or the amendment, renewal or extension of an outstanding Letter
of Credit), the Borrower shall hand deliver or telecopy (or transmit by electronic communication,
if arrangements for doing so have been approved by the applicable Issuing Bank) to such Issuing
Bank and the Administrative Agent (reasonably in advance of the requested date of issuance,
amendment, renewal or extension) a notice requesting the issuance of a Letter of Credit, or
identifying the Letter of Credit to be amended, renewed or extended, and specifying the date of
issuance, amendment, renewal or extension (which shall be a Business Day), the date on which such
Letter of Credit is to expire (which shall comply with paragraph (c) of this Section), the
amount of such Letter of Credit, the name and address of the beneficiary thereof and such other
information as shall be necessary to prepare, amend, renew or extend such Letter of Credit. If
requested by the Issuing Bank, the Borrower also shall submit a letter of credit application on
such Issuing Bank’s standard form in connection with any request for a Letter of Credit. A Letter
of Credit shall be issued, amended, renewed or extended only if (and upon issuance, amendment,
renewal or extension of each Letter of Credit the Borrower shall be deemed to represent and warrant
that), after giving effect to such issuance, amendment, renewal or extension the aggregate amount
of the Revolving Credit Exposures of all Lenders shall not exceed the total Commitments. Each
issuance, amendment, renewal or extension of a Letter of Credit shall be deemed to constitute a
representation and warranty by the Borrower on the date thereof as to the matters specified in
Section 5.2.1.

     (c) Expiration Date. Each Letter of Credit shall expire at or prior to the close of
business on the earlier of (i) the date one year after the date of the issuance of such Letter of
Credit, provided that any Letter of Credit may provide for the renewal thereof for
additional one-year periods (which shall in no event extend beyond the date referred to in
clause (ii) hereof) and (ii) the date that is five Business Days prior to the then
effective Maturity Date.

     (d) Participations. By the issuance of a Letter of Credit (or an amendment to a
Letter of Credit increasing the amount thereof) and without any further action on the part of the
Issuing

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Bank or the Lenders, the Issuing Bank hereby grants to each Lender, and each Lender hereby
acquires from the Issuing Bank, a participation in such Letter of Credit equal to such Lender’s
Percentage of the aggregate amount available to be drawn under such Letter of Credit. In
consideration and in furtherance of the foregoing, each Lender hereby absolutely and
unconditionally agrees to pay to the Administrative Agent, for the account of such Issuing Bank,
such Lender’s Percentage of each LC Disbursement made by such Issuing Bank and not reimbursed by
the Borrower on the date due as provided in paragraph (e) of this Section, or of any
reimbursement payment required to be refunded to the Borrower for any reason. Each Lender
acknowledges and agrees that its obligation to acquire participations pursuant to this paragraph in
respect of Letters of Credit is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including any amendment, renewal or extension of any Letter of Credit or
the occurrence and continuance of a Default or reduction or termination of the Commitments, and
that each such payment shall be made without any offset, abatement, withholding or reduction
whatsoever.

     (e) Reimbursement. If an Issuing Bank shall make any LC Disbursement in respect of a
Letter of Credit, the Borrower shall reimburse such LC Disbursement by paying to the Administrative
Agent an amount equal to such LC Disbursement not later than 12:00 noon, Central time, on the date
that such LC Disbursement is made, if the Borrower shall have received notice of such LC
Disbursement prior to 10:00 a.m., Central time, on such date, or, if such notice has not been
received by the Borrower prior to such time on such date, then not later than 12:00 noon, Central
time, on (i) the Business Day that the Borrower receives such notice, if such notice is received
prior to 10:00 a.m., Central time, on the day of receipt, or (ii) the Business Day immediately
following the day that the Borrower receives such notice, if such notice is not received prior to
such time on the day of receipt; provided that the Borrower may, subject to the conditions
to borrowing set forth herein, request in accordance with Section 2.5.1 that such payment
be financed with a Base Rate Loan in an equivalent amount and, to the extent so financed, the
Borrower’s obligation to make such payment shall be discharged and replaced by the resulting
Borrowing. If the Borrower fails to make such payment when due, the Administrative Agent shall
notify each Lender of the applicable LC Disbursement, the payment then due from the Borrower in
respect thereof and such Lender’s Percentage thereof. Promptly following receipt of such notice,
each Lender shall pay to the Administrative Agent its Percentage of the payment then due from the
Borrower, in the same manner as provided with respect to Revolving Loans made by such Lender, and
the Administrative Agent shall promptly pay to such Issuing Bank the amounts so received by it from
the Lenders. Promptly following receipt by the Administrative Agent of any payment from the
Borrower pursuant to this paragraph, the Administrative Agent shall distribute such payment to such
Issuing Bank or, to the extent that Lenders have made payments pursuant to this paragraph to
reimburse such Issuing Bank, then to such Lenders and the Issuing Bank as their interests may
appear. Any payment made by a Lender pursuant to this paragraph to reimburse such Issuing Bank for
any LC Disbursement (other than the funding of Base Rate Loans pursuant to Section 2.5.1 as
contemplated above) shall not constitute a Loan and shall not relieve the Borrower of its
obligation to reimburse such LC Disbursement.

     (f) Obligations Absolute. The Borrower’s obligation to reimburse LC Disbursements as
provided in paragraph (e) of this Section shall be absolute, unconditional and irrevocable,
and shall be performed strictly in accordance with the terms of this Agreement under any and all

25

 

circumstances whatsoever and irrespective of (i) any lack of validity or enforceability of any
Letter of Credit or this Agreement, or any term or provision therein, (ii) any draft or other
document presented under a Letter of Credit proving to be forged, fraudulent or invalid in any
respect or any statement therein being untrue or inaccurate in any respect, (iii) payment by the
Issuing Bank under a Letter of Credit against presentation of a draft or other document that does
not comply with the terms of such Letter of Credit, or (iv) any other event or circumstance
whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of
this Section, constitute a legal or equitable discharge of, or provide a right of setoff against,
the Borrower’s obligations hereunder. Neither the Administrative Agent, the Lenders nor the
Issuing Bank, nor any of their Related Parties, shall have any liability or responsibility by
reason of or in connection with the issuance or transfer of any Letter of Credit or any payment or
failure to make any payment thereunder (irrespective of any of the circumstances referred to in the
preceding sentence), or any error, omission, interruption, loss or delay in transmission or
delivery of any draft, notice or other communication under or relating to any Letter of Credit
(including any document required to make a drawing thereunder), any error in interpretation of
technical terms or any consequence arising from causes beyond the control of the Issuing Bank;
provided that the foregoing shall not be construed to excuse the Issuing Bank from
liability to the Borrower to the extent of any direct damages (as opposed to consequential damages,
claims in respect of which are hereby waived by the Borrower to the extent permitted by applicable
law) suffered by the Borrower that are caused by the Issuing Bank’s failure to exercise care when
determining whether drafts and other documents presented under a Letter of Credit comply with the
terms thereof. The parties hereto expressly agree that, in the absence of gross negligence or
willful misconduct on the part of the Issuing Bank (as finally determined by a court of competent
jurisdiction), the Issuing Bank shall be deemed to have exercised care in each such determination.
In furtherance of the foregoing and without limiting the generality thereof, the parties agree
that, with respect to documents presented which appear on their face to be in substantial
compliance with the terms of a Letter of Credit, the Issuing Bank may, in its sole discretion,
either accept and make payment upon such documents without responsibility for further
investigation, regardless of any notice or information to the contrary, or refuse to accept and
make payment upon such documents if such documents are not in strict compliance with the terms of
such Letter of Credit.

     (g) Disbursement Procedures. The applicable Issuing Bank shall, promptly following
its receipt thereof, examine all documents purporting to represent a demand for payment under a
Letter of Credit. Such Issuing Bank shall promptly notify the Administrative Agent and the
Borrower by telephone (confirmed by telecopy) of such demand for payment and whether the Issuing
Bank has made or will make an LC Disbursement thereunder; provided that any failure to give
or delay in giving such notice shall not relieve the Borrower of its obligation to reimburse the
Issuing Bank and the Lenders with respect to any such LC Disbursement.

     (h) Interim Interest. If an Issuing Bank shall make any LC Disbursement, then, unless
the Borrower shall reimburse such LC Disbursement in full on the date such LC Disbursement is made,
the unpaid amount thereof shall bear interest, for each day from and including the date such LC
Disbursement is made to but excluding the date that the Borrower reimburses such LC Disbursement,
at the rate per annum then applicable to Base Rate Loans; provided that, if the Borrower
fails to reimburse such LC Disbursement when due pursuant to paragraph (e) of this Section,
then Section 3.2.2 shall apply. Interest accrued pursuant to this

26

 

paragraph shall be for the account of the Issuing Bank, except that interest accrued on and
after the date of payment by any Lender pursuant to paragraph (e) of this Section to
reimburse the Issuing Bank shall be for the account of such Lender to the extent of such payment.

     (i) Replacement of the Issuing Bank. Any Issuing Bank may be replaced at any time by
written agreement among the Borrower, the Administrative Agent, the replaced Issuing Bank and the
successor Issuing Bank. The Administrative Agent shall notify the Lenders of any such replacement
of an Issuing Bank. At the time any such replacement shall become effective, the Borrower shall
pay all unpaid fees accrued for the account of the replaced Issuing Bank pursuant to Section
3.3.3. From and after the effective date of any such replacement, (i) the successor Issuing
Bank shall have all the rights and obligations of such Issuing Bank under this Agreement with
respect to Letters of Credit to be issued thereafter and (ii) references herein to the term
“Issuing Bank” shall be deemed to refer to such successor or to any previous Issuing Bank, or to
such successor and all previous Issuing Banks, as the context shall require. After the replacement
of an Issuing Bank hereunder, the replaced Issuing Bank shall remain a party hereto and shall
continue to have all the rights and obligations of an Issuing Bank under this Agreement with
respect to Letters of Credit issued by it prior to such replacement, but shall not be required to
issue additional Letters of Credit.

     (j) Cash Collateralization. If the Obligations have become immediately due and
payable pursuant to Article VIII, on the Business Day that the Borrower receives notice
from the Administrative Agent or the Required Lenders (or, if the maturity of the Loans has been
accelerated, Lenders with LC Exposure representing greater than 50% of the total LC Exposure)
demanding the deposit of cash collateral pursuant to this paragraph, the Borrower shall deposit in
an account with the Administrative Agent, in the name of the Administrative Agent and for the
benefit of the Lenders, an amount in cash equal to the LC Exposure as of such date plus any accrued
and unpaid interest thereon; provided that the obligation to deposit such cash collateral shall
become effective immediately, and such deposit shall become immediately due and payable, without
demand or other notice of any kind, upon the Obligations having become immediately due and payable
as a result of an Event of Default with respect to the Borrower described in Section 8.1.9.
Such deposit shall be held by the Administrative Agent as collateral for the payment and
performance of the obligations of the Borrower under this Agreement. The Administrative Agent
shall have exclusive dominion and control, including the exclusive right of withdrawal, over such
account. Other than any interest earned on the investment of such deposits, which investments
shall be made at the option and sole discretion of the Administrative Agent and at the Borrower’s
risk and expense, such deposits shall not bear interest. Interest or profits, if any, on such
investments shall accumulate in such account. Moneys in such account shall be applied by the
Administrative Agent to reimburse the Issuing Banks for LC Disbursements for which they have not
been reimbursed and, to the extent not so applied, shall be held for the satisfaction of the
reimbursement obligations of the Borrower for the LC Exposure at such time or, if the maturity of
the Loans has been accelerated (but subject to the consent of Lenders with LC Exposure representing
greater than 50% of the total LC Exposure), be applied to satisfy other obligations of the Borrower
under this Agreement.

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ARTICLE III

REPAYMENTS, PREPAYMENTS, INTEREST AND FEES

     SECTION 3.1 Repayments and Prepayments. The Borrower shall repay in full the unpaid
principal amount of each Loan on the Maturity Date. Prior thereto, the Borrower

     (a) may, from time to time on any Business Day, make a voluntary prepayment, in whole or in
part, of the outstanding principal amount of any Loans; provided, however, that (i)
any such prepayment shall be applied to the Lenders among Loans having the same Type and, if
applicable, having the same Interest Period; (ii) all such voluntary prepayments of Revolving Loans
shall require at least three Business Days’ prior written notice to the Administrative Agent; (iii)
all such voluntary prepayments of Swingline Loans shall be permitted on the same day as written
notice is received by the Administrative Agent and the Swingline Lender; and (iv) except in the
case of a prepayment pursuant to Section 2.9(c), all such voluntary partial prepayments
shall be in an minimum amount of $5,000,000 and an integral multiple of $1,000,000;

     (b) shall, immediately upon any acceleration of the Maturity Date pursuant to Section
8.2 or Section 8.3, repay all Loans unless, pursuant to Section 8.3, only a
portion of all Loans is so accelerated; and

     (c) at any time when the aggregate amount of the Revolving Credit Exposures of all Lenders
exceeds the Commitment Amount then in effect, shall (i) first, immediately prepay
outstanding Loans in an amount equal to such excess and (ii) second, if after giving effect
to the prepayment required in clause (i) above, the aggregate amount of the Revolving
Credit Exposures of all Lenders still exceeds the Commitment Amount then in effect, immediately
cash collateralize such Revolving Credit Exposure in conformity with Section 2.11(j) in an
amount equal to such remaining excess.

     Each prepayment of any Loans made pursuant to this Section shall be without premium or penalty,
except as may be required by Section 4.4. No voluntary prepayment of principal of any
Loans shall cause a reduction in the Commitments or the Commitment Amount.

     SECTION 3.2 Interest Provisions. Interest on the outstanding principal amount of
Loans shall accrue and be payable in accordance with this Section 3.2.

     SECTION 3.2.1 Rates. Pursuant to an appropriately delivered Borrowing Request or
Continuation/Conversion Notice, the Borrower may elect that Loans comprising a Borrowing accrue
interest at a rate per annum: (a) on that portion maintained from time to time as a Base Rate Loan,
equal to the Base Rate from time to time in effect; (b) on that portion maintained as a Eurodollar
Loan, during each Interest Period applicable thereto, equal to the sum of the Eurodollar Rate for
such Interest Period plus the Applicable Margin; and (c) on that portion maintained from time to
time as an ASK Rate Loan, equal to the ASK Rate from time to time in effect plus the Applicable
Margin. All Eurodollar Borrowings shall bear interest from and including the first day of the
applicable Interest Period to (but not including) the last day of such Interest Period at the
interest rate determined as applicable to such Eurodollar Borrowing.

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     SECTION 3.2.2 Post-Maturity Rates. After the date any principal amount of any Loan is
due and payable (whether on the Maturity Date, upon acceleration or otherwise), or after any other
monetary Obligation, including, without limitation, the payment of interest, fees or any other
amounts under this Agreement or the other Loan Documents) of the Borrower shall have become due and
payable, the Borrower shall pay, but only to the extent permitted by law, interest (after as well
as before judgment) on such amounts at a rate per annum equal to the Base Rate plus the Default
Margin; provided, however, notwithstanding the foregoing, that interest for a
Eurodollar Loan shall accrue for the then effective Interest Period at a rate per annum equal to
the Eurodollar Rate currently applicable to such Eurodollar Loan plus the Default Margin.

     SECTION 3.2.3 Payment Dates. Interest accrued on each Borrowing shall be payable,
without duplication on the following dates (each a “Payment Date”): (a) on the Maturity
Date; (b) on the date of any payment or prepayment, in whole or in part, of principal outstanding
on such Loan (including any and all Swingline Loans) on the amount of such principal prepaid or
repaid; (c) with respect to Base Rate Loans (other than Swingline Loans), on each Quarterly Payment
Date occurring after the Effective Date; (d) with respect to Eurodollar Borrowings, on the last day
of each applicable Interest Period (and, if such Interest Period shall exceed three months, every
three months from the first day of such Interest Period); (e) with respect to any portion of Base
Rate Loans converted into Eurodollar Loans on a day when interest would not otherwise have been
payable pursuant to clause (c), on the date of such conversion; and (f) on that portion of
any Borrowings the Maturity Date of which is accelerated pursuant to Section 8.2 or
Section 8.3, immediately upon such acceleration.

     SECTION 3.3 Fees. The Borrower agrees to pay the fees set forth in this Section
3.3. All such fees shall be non-refundable.

     SECTION 3.3.1 Facility Fee. The Borrower agrees to pay to the Administrative Agent
for the account of each Lender a facility fee in an amount equal to the product of the Applicable
Facility Fee Rate times such Lender’s Commitment. Accrued facility fees shall be payable in
arrears on each Quarterly Payment Date thereafter and on the Maturity Date.

     SECTION 3.3.2 Fees. The Borrower agrees to pay to the Administrative Agent for its
own account and for the account of each Lender and Arranger, respectively, all fees due pursuant to
(i) that certain fee letter, dated October 6, 2006, between the Borrower, the Administrative Agent
and J.P. Morgan Securities Inc., as amended from time to time (the “Fee Letter”),
including, without limitation, any upfront fees.

     SECTION 3.3.3 Letter of Credit Fees. The Borrower agrees to pay (i) to the
Administrative Agent for the account of each Lender a participation fee with respect to its
participations in Letters of Credit, which shall accrue at the same Applicable Margin used to
determine the interest rate applicable to Eurodollar Loans on the average daily amount of such
Lender’s LC Exposure (excluding any portion thereof attributable to unreimbursed LC Disbursements)
during the period from and including the Effective Date to but excluding the later of the date on
which such Lender’s Commitment terminates and the date on which such Lender ceases to have any LC
Exposure, and (ii) to each Issuing Bank a fronting fee, which shall accrue at the rate of .125% per
annum on the average daily amount of the LC Exposure (excluding any portion thereof attributable to
unreimbursed LC Disbursements) applicable to

29

 

such Issuing Bank during the period from and including the Effective Date to but excluding the
later of the date of termination of the Commitments and the date on which there ceases to be any LC
Exposure, as well as such Issuing Bank’s standard fees with respect to the issuance, amendment,
renewal or extension of any Letter of Credit or processing of drawings thereunder. Participation
fees and fronting fees accrued through and including the last day of March, June, September and
December of each year shall be payable on the third (3) Business Day following such last day,
commencing on the first such date to occur after the Effective Date; provided that all such
fees shall be payable on the date on which the Commitments terminate and any such fees accruing
after the date on which the Commitments terminate shall be payable on demand. Any other fees
payable to an Issuing Bank pursuant to this paragraph shall be payable within ten (10) days after
demand. All participation fees and fronting fees shall be computed on the basis of a year of 360
days and shall be payable for the actual number of days elapsed (including the first day but
excluding the last day).

     SECTION 3.4 Payment Office. The Borrower shall make all payments to the
Administrative Agent at the Payment Office.

ARTICLE IV

CERTAIN EURODOLLAR AND OTHER PROVISIONS

     SECTION 4.1 Eurodollar Lending Unlawful. If any Lender shall determine (which
determination shall, upon notice thereof to the Borrower and the Lenders, be conclusive and binding
on the Borrower) that the introduction of or any change in or in the interpretation of any law
makes it unlawful, or any central bank or other governmental authority asserts that it is unlawful,
for such Lender to make, continue or maintain any Borrowing as, or to convert any Borrowing into, a
Eurodollar Borrowing, the obligations of such Lender to make, continue, maintain or convert any
such Borrowings shall, upon such determination, forthwith be suspended until such Lender shall
notify the Administrative Agent that the circumstances causing such suspension no longer exist, and
all Eurodollar Borrowings of such Lender shall automatically convert into Base Rate Loans at the
end of the then current Interest Periods with respect thereto or sooner, if required by such law or
assertion; provided, however, that the obligation of such Lender to make, continue,
maintain or convert any such Eurodollar Borrowings shall remain unaffected if such Lender can
designate a different Eurodollar Office for the making, continuance, maintenance or conversion of
Eurodollar Borrowings and such designation will not, in the sole discretion of such Lender, be
otherwise disadvantageous to such Lender.

     SECTION 4.2 Deposits Unavailable or Eurodollar Interest Rate Unascertainable. If the
Administrative Agent shall have determined that, by reason of circumstances affecting the
Administrative Agent’s relevant market, adequate means do not exist for ascertaining the interest
rate applicable hereunder to Eurodollar Borrowings, then, upon notice from the Administrative Agent
to the Borrower and the Lenders, the obligations of all Lenders under Section 2.5.2 and
Section 2.6 to make or continue any Borrowings as, or to convert any Borrowings into,
Eurodollar Borrowings shall forthwith be suspended until the Administrative Agent shall notify the
Borrower and the Lenders that the circumstances causing such suspension no longer exist.

     SECTION 4.3 Increased Eurodollar Borrowing Costs, etc. The Borrower agrees to
reimburse each Lender and Issuing Bank for any increase in the cost to such Lender or Issuing

30

 

Bank of, or any reduction in the amount of any sum receivable by such Lender or Issuing Bank
in respect of, making, continuing or maintaining (or of its obligation to make, continue or
maintain) any Borrowings as, or of converting (or of its obligation to convert) any Borrowings
into, Eurodollar Borrowings or participating in, issuing or maintaining any Letter of Credit. Such
Lender or Issuing Bank shall promptly notify the Administrative Agent and the Borrower in writing
of the occurrence of any such event, such notice to state, in reasonable detail, the reasons
therefor and the additional amount required fully to compensate such Lender or Issuing Bank for
such increased cost or reduced amount; provided, however, that such Lender or
Issuing Bank shall designate a different Eurodollar Office if such designation will avoid the need
for, or reduce the amount of, such compensation and will not, in the sole discretion of such Lender
or Issuing Bank, be otherwise disadvantageous to such Lender. Such additional amounts shall be
payable by the Borrower directly to such Lender or Issuing Bank within fifteen days of its receipt
of such notice, and such notice shall be rebuttable presumptive evidence of the amount payable by
the Borrower.

     SECTION 4.4 Funding Losses. In the event any Lender shall incur any loss or expense
(including any loss or expense incurred by reason of the liquidation or reemployment of deposits or
other funds acquired by such Lender to make, continue or maintain any portion of the principal
amount of any Borrowing as, or to convert any portion of the principal amount of any Borrowing
into, a Eurodollar Borrowing) as a result of (a) any conversion or repayment or prepayment of the
principal amount of any Eurodollar Borrowings on a date other than the scheduled last day of the
Interest Period applicable thereto, whether pursuant to Section 3.1 or otherwise, (b) any
Borrowings not being made as Eurodollar Borrowings in accordance with the Borrowing Request
therefor, (c) any Borrowings not being continued as, or converted into, Eurodollar Borrowings in
accordance with the Continuation/Conversion Notice, or (d) the assignment of any Eurodollar
Borrowing other than on the last day of the Interest Period applicable thereto as a result of a
request by the Borrower pursuant to Section 4.10, then, upon the written notice of such
Lender to the Borrower (with a copy to the Administrative Agent), the Borrower shall, within
fifteen days of its receipt thereof, pay directly to such Lender such amount as will (in the
reasonable determination of such Lender) reimburse such Lender for such loss or expense. Such
written notice (which shall include calculations in reasonable detail) shall be rebuttable
presumptive evidence of the amount payable by the Borrower.

     SECTION 4.5 Increased Capital Costs. If any change in, or the introduction, adoption,
effectiveness, interpretation, reinterpretation or phase-in of, any law or regulation, directive,
guideline, decision or request (whether or not having the force of law) of any court, central bank,
regulator or other governmental authority affects or would affect the amount of capital required or
expected to be maintained by any Lender or any Issuing Bank or any Person controlling such party,
and such Lender or Issuing Bank determines (in its sole discretion) that the rate of return on its
or such controlling Person’s capital as a consequence of its Commitments or the Borrowings made by
such Lender or Issuing Bank is reduced to a level below that which such Lender or Issuing Bank or
such controlling Person could have achieved but for the occurrence of any such circumstance, then,
in any such case upon notice from time to time by such Lender or Issuing Bank to the Borrower, the
Borrower shall pay directly to such Lender or Issuing Bank, within fifteen days, additional amounts
sufficient to compensate such Lender or Issuing Bank or such controlling Person for such reduction
in rate of return; provided, however, that such Lender or Issuing Bank shall
designate a different Domestic or Eurodollar Office if

31

 

such designation will avoid the need for, or reduce the amount of, such compensation and will
not, in the sole discretion of such Lender or Issuing Bank, be otherwise disadvantageous to such
Lender or Issuing Bank. A statement of such Lender or Issuing Bank as to any such additional
amount or amounts (including calculations thereof in reasonable detail) shall be rebuttable
presumptive evidence of the amount payable by the Borrower. In determining such amount, such
Lender or Issuing Bank may use any reasonable method of averaging and attribution that it (in its
sole discretion) shall deem applicable.

     SECTION 4.6 Taxes. All payments by the Borrower of principal of, and interest on, the
Borrowings and all other amounts payable hereunder shall be made free and clear of and without
deduction for any present or future income, excise, stamp or franchise taxes and other taxes, fees,
duties, withholdings or other charges of any nature whatsoever imposed by any taxing authority, but
excluding franchise taxes and taxes imposed on or measured by any Lender’s net income or receipts
(such non-excluded items being called “Taxes”). In the event that any withholding or
deduction from any payment to be made by the Borrower hereunder is required in respect of any Taxes
pursuant to any applicable law, rule or regulation, then the Borrower will, within fifteen days (a)
pay directly to the relevant authority the full amount required to be so withheld or deducted; (b)
promptly forward to the Administrative Agent an official receipt or other documentation
satisfactory to the Administrative Agent evidencing such payment to such authority; and (c) pay to
the Administrative Agent for the account of each applicable Lender or Issuing Bank such additional
amount or amounts as is necessary to ensure that the net amount actually received by each Lender
and Issuing Bank will equal the full amount such Lender or Issuing Bank would have received had no
such withholding or deduction been required.

     If any Taxes are directly asserted against the Administrative Agent, any Lender or any Issuing
Bank with respect to any payment received by the Administrative Agent, such Lender or such Issuing
Bank hereunder, the Administrative Agent, such Lender or such Issuing Bank may pay such Taxes and
the Borrower will promptly pay such additional amounts (including any penalties, interest or
expenses) as is necessary in order that the net amount received by such person after the payment of
such Taxes (including any Taxes on such additional amount) shall equal the amount such person would
have received had not such Taxes been asserted; provided that the Borrower will not be
obligated to pay such additional amounts to the Administrative Agent, such Lender or such Issuing
Bank to the extent that such additional amounts shall have been incurred as a consequence of the
Administrative Agent’s, such Lender’s, or such Issuing Bank’s gross negligence or willful
misconduct, as the case may be.

     If the Borrower fails to pay any Taxes when due to the appropriate taxing authority or fails
to remit to the Administrative Agent, for the account of the respective Lenders or Issuing Banks,
the required receipts or other required documentary evidence, the Borrower shall indemnify such
Lenders and Issuing Banks for any incremental Taxes, interest or penalties that may become payable
by any Lender or Issuing Bank as a result of any such failure. For purposes of this Section, a
distribution hereunder by the Administrative Agent, any Lender or any Issuing Bank to or for the
account of any Lender or Issuing Bank shall be deemed a payment by the Borrower.

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     Each Lender that is organized under the laws of a jurisdiction other than the United States
shall, prior to the due date of any payments of the Loans under this Agreement, execute and deliver
to the Borrower and the Administrative Agent, on or about the first scheduled Payment Date in each
Fiscal Year, one or more (as the Borrower or the Administrative Agent may reasonably request)
United States Internal Revenue Service Form W-8 BEN or Form W-8 ECI or such other forms or
documents (or successor forms or documents), appropriately completed, as may be applicable to
establish the extent, if any, to which a payment to such Lender is exempt from withholding or
deduction of Taxes, and shall (but only so long as such Lender remains lawfully able to do so)
deliver to the Borrower and the Administrative Agent additional copies of such forms on or before
the date that such forms expire or become obsolete or after the occurrence of an event requiring a
change in the most recent form so delivered by it and such amendments thereto as may be reasonably
requested by the Borrower or the Administrative Agent, in each case certifying that such Lender is
entitled to benefits under an income tax treaty to which the United States is a party which reduces
the rate of withholding tax on payments of interest or fees or certifying that the income
receivable pursuant to this Agreement is effectively connected with the conduct of a trade or
business in the United States. If the form provided by a Lender at the time such Lender first
becomes a party to this Agreement indicates a United States withholding tax rate in excess of zero,
withholding tax at such rate shall be considered excluded from the definition of “Taxes”. For any
period with respect to which a Lender has failed to provide the Borrower and the Administrative
Agent with the forms required pursuant to this paragraph, if any (other than if such failure is due
to a change in treaty, law or regulation occurring subsequent to the date on which a form
originally was required to be provided), such Lender shall not be entitled to indemnification under
this Section with respect to Taxes imposed by the United States which Taxes would not have been
imposed but for such failure to provide such form; provided, however, that should a Lender, which
is otherwise exempt from or subject to a reduced rate of withholding tax, become subject to Taxes
because of its failure to deliver a form required hereunder, the Borrower shall take such steps as
the Lender shall reasonably request to assist the Lender to recover such Taxes.

     If the Borrower is required to pay additional amounts to or for the account of any Lender or
Issuing Bank pursuant to this Section, then such Lender or Issuing Bank will change the
jurisdiction of its applicable Eurodollar or Domestic Office so as to eliminate or reduce any such
additional payment which may thereafter accrue if such change, in the sole discretion of such
Lender or Issuing Bank, is not otherwise disadvantageous to such Lender or Issuing Bank. No Lender
or Issuing Bank shall be entitled to receive any greater payment under this Section as a result of
the designation by such Lender or Issuing Bank of a different applicable Eurodollar or Domestic
Office after the date hereof, unless such designation is made with the Borrower’s prior written
consent or by reason of the provisions of Sections 4.1, 4.3 or 4.5
requiring such Lender or Issuing Bank to designate a different applicable Eurodollar or Domestic
Office under certain circumstances or at a time when the circumstances giving rise to such greater
payment did not exist.

     SECTION 4.7 Special Fees in Respect of Reserve Requirements. With respect to
Eurodollar Borrowings, the Borrower agrees to pay to each Lender on appropriate Payment Dates, as
additional interest, such amounts as will compensate such Lender for any cost to such Lender, from
time to time, of any reserve, special deposit, special assessment or similar capital requirements
against assets of, deposits with or for the account of, or credit extended by, such

33

 

Lender which are imposed on, or deemed applicable by, such Lender, from time to time, under or
pursuant to (i) any Law, treaty, regulation or directive now or hereafter in effect (including,
without limitation, Regulation D of the Board of Governors of the Federal Reserve System but
excluding any reserve requirement included in the definition of Eurodollar Rate in Section
1.1), (ii) any interpretation or application thereof by any governmental authority, agency or
instrumentality charged with the administration thereof or by any court, central bank or other
fiscal, monetary or other authority having jurisdiction over the Eurodollar Borrowings or the
office of such Lender where its Eurodollar Borrowings are lodged, or (iii) any requirement imposed
or requested by any court, governmental authority, agency or instrumentality or central bank,
fiscal, monetary or other authority, whether or not having the force of law. A written notice as
to the amount of any such cost or any change therein (including calculations, in reasonable detail,
showing how such Lender computed such cost or change) shall be promptly furnished by such Lender to
the Borrower and shall be rebuttable presumptive evidence of such cost or change. The Borrower
will not be responsible for paying any amounts pursuant to this Section accruing prior to 180 days
prior to the receipt by the Borrower of the written notice referred to in the preceding sentence.
Within fifteen (15) days after such certificate is furnished to the Borrower, the Borrower will pay
directly to such Lender such additional amount or amounts as will compensate such Lender for such
cost or change.

     SECTION 4.8 Payments, Computations, etc. Unless otherwise expressly provided, all
payments by the Borrower pursuant to this Agreement or any other Loan Document shall be made by the
Borrower to the Administrative Agent for the pro rata account of the Lenders
entitled to receive such payment; provided that payments with respect to Swingline Loans
shall be for the account of the Swingline Lender unless a Lender has funded its participation in
such Swingline Loan, in which case such payments shall be for the account of the funding Lender.
All such payments required to be made to the Administrative Agent shall be made, without setoff,
deduction or counterclaim, not later than 11:00 a.m., Central time, on the date due, in same day or
immediately available funds, to such account as the Administrative Agent shall specify from time to
time by notice to the Borrower. Funds received after that time shall be deemed to have been
received by the Administrative Agent on the next succeeding Business Day. The Administrative Agent
shall promptly remit in same day funds to each Lender its share, if any, of such payments received
by the Administrative Agent for the account of such Lender. All interest and fees shall be
computed on the basis of the actual number of days (including the first day but excluding the last
day) occurring during the period for which such interest or fee is payable over a year comprised of
360 days (or, in the case of interest on a Base Rate Loan, 365 days or, if appropriate, 366 days).
Whenever any payment to be made shall otherwise be due on a day which is not a Business Day, such
payment shall (except as otherwise required by clause (c) of the definition of the term
“Interest Period” with respect to Eurodollar Loans) be made on the next succeeding Business
Day and such extension of time shall be included in computing interest and fees, if any, in
connection with such payment.

     SECTION 4.9 Sharing of Payments. If any Lender shall obtain any payment or other
recovery (whether voluntary, involuntary, by application of setoff or otherwise) on account of any
Loan (other than pursuant to the terms of Sections 2.10(b), 4.1, 4.3,
4.4, 4.5 and 10.4) or participation in LC Disbursements or Swingline Loans
in excess of its pro rata share of payments then or therewith obtained by all
Lenders, such Lender shall purchase from the other Lenders such participations in Revolving Loans
and participations in LC Disbursements and Swingline

34

 

Loans made by them as shall be necessary to cause such purchasing Lender to share the excess
payment or other recovery ratably with each of them; provided, however, that if all
or any portion of the excess payment or other recovery is thereafter recovered from such purchasing
Lender, the purchase shall be rescinded and each Lender which has sold a participation to the
purchasing Lender shall repay to the purchasing Lender the purchase price to the ratable extent of
such recovery together with an amount equal to such selling Lender’s ratable share (according to
the proportion of (a) the amount of such selling Lender’s required repayment to the purchasing
Lender to (b) the total amount so recovered from the purchasing Lender) of any interest or
other amount paid or payable by the purchasing Lender in respect of the total amount so recovered.
The Borrower agrees that any Lender so purchasing a participation from another Lender pursuant to
this Section may, to the fullest extent permitted by law, exercise all its rights of payment with
respect to such participation as fully as if such Lender were the direct creditor of the Borrower
in the amount of such participation. If under any applicable bankruptcy, insolvency or other
similar law, any Lender receives a secured claim in lieu of a set off to which this Section
applies, such Lender shall, to the extent practicable, exercise its rights in respect of such
secured claim in a manner consistent with the rights of the Lenders entitled under this Section to
share in the benefits of any recovery on such secured claim.

     SECTION 4.10 Replacement of Lender on Account of Increased Costs, Eurodollar Lending
Unlawful, Reserve Requirements, Taxes, Certain Dissents, etc. If any Lender shall claim the
inability to make or maintain Eurodollar Borrowings pursuant to Section 4.1 above, if any
Lender is owed increased costs under Section 4.3 or Section 4.5 above, if any
payment to any Lender by the Borrower is subject to any withholding tax pursuant to Section
4.6 above, if any Lender is owed any cost or expense pursuant to Section 4.7 above, if
any Lender fails to agree to extend the Maturity Date pursuant to Section 2.10 if the
requisite Lenders have agreed to do so, if any Lender has failed to fund any portion of any Loan or
LC Disbursement or participation in a Swingline Loan required to be funded by it within one
Business Day after the date required to be funded by it or if, in connection with any proposed
amendment, modification, waiver or consent with respect to the interest or fees charged under the
Agreement requiring consent of each Lender, the consent of the Required Lenders shall have been
obtained, but the consent of one or more of the other Lenders whose consent is required shall not
have been obtained, the Borrower shall have the right, if no Event of Default or Default then
exists, to replace such Lender with another bank or financial institution provided that (i)
if it is not a Lender or an Affiliate thereof, such bank or financial institution shall be
reasonably acceptable to the Administrative Agent and the Issuing Banks and (ii) such bank or
financial institution shall unconditionally purchase, in accordance with Section 10.10
hereof, all of such Lender’s rights and obligations under this Agreement and the other Loan
Documents and the appropriate pro rata share of such Lender’s Loans, LC Exposure, obligation to
participate in Swingline Loans and Commitments, without recourse or expense to, or warranty by,
such Lender being replaced for a purchase price equal to the aggregate outstanding principal amount
of the Loans payable to such Lender, plus any accrued but unpaid interest on such Loans,
plus accrued but unpaid fees in respect of such Lender’s Borrowings and such Lender’s
Commitment hereunder to the date of such purchase on a date therein specified. The Borrower shall
be obligated to pay, simultaneously with such purchase and sale, the increased costs, amounts,
expenses and taxes under Sections 4.1, 4.2, 4.3, 4.5, 4.6,
and 4.7 above, any amounts payable under Section 4.4 and all other costs, fees and
expenses payable to such Lender hereunder and under the Loan Documents, to the date of such
purchase as well as all other Obligations due and payable to or

35

 

for the benefit of such Lender; provided, that if such bank or financial institution
fails to purchase such rights and obligations, the Borrower shall continue to be obligated to pay
the increased costs, amounts, expenses and taxes under Sections 4.3, 4.5,
4.6, and 4.7 above to such Lender.

     SECTION 4.11 Maximum Interest. It is the intention of the parties hereto to conform
strictly to applicable usury laws and, anything herein to the contrary notwithstanding, the
obligations of the Borrower to the Administrative Agent and each Lender under this Agreement shall
be subject to the limitation that payments of interest shall not be required to the extent that
receipt thereof would be contrary to provisions of law applicable to the Administrative Agent or
such Lender limiting rates of interest which may be charged or collected by the Administrative
Agent or such Lender. Accordingly, if the transactions contemplated hereby would be usurious under
applicable law (including the Federal and state laws of the United States of America, or of any
other jurisdiction whose laws may be mandatorily applicable) with respect to the Administrative
Agent or a Lender then, in that event, notwithstanding anything to the contrary in this Agreement,
it is agreed as follows: (a) the provisions of this Section shall govern and control; (b) the
aggregate of all consideration which constitutes interest under applicable law that is contracted
for, charged or received under this Agreement, or under any of the other aforesaid agreements or
otherwise in connection with this Agreement by the Administrative Agent or such Lender shall under
no circumstances exceed the maximum amount of interest allowed by applicable law (such maximum
lawful interest rate, if any, with respect to such Lender herein called the “Highest Lawful
Rate”), and any excess shall be credited to the Borrower by the Administrative Agent or such
Lender (or, if such consideration shall have been paid in full, such excess refunded to the
Borrower); (c) all sums paid, or agreed to be paid, to the Administrative Agent or such Lender for
the use, forbearance and detention of the Indebtedness of the Borrower to the Administrative Agent
or such Lender hereunder shall, to the extent permitted by applicable law, be amortized, prorated,
allocated and spread throughout the full term of such Indebtedness until payment in full so that
the actual rate of interest is uniform throughout the full term thereof; and (d) if at any time the
interest provided pursuant to Section 4.1 together with any other fees payable pursuant to
this Agreement and the other Loan Documents and deemed interest under applicable law, exceeds that
amount which would have accrued at the Highest Lawful Rate, the amount of interest and any such
fees to accrue to the Administrative Agent or such Lender pursuant to this Agreement shall be
limited, notwithstanding anything to the contrary in this Agreement to that amount which would have
accrued at the Highest Lawful Rate, but any subsequent reductions, as applicable, shall not reduce
the interest to accrue to the Administrative Agent or such Lender pursuant to this Agreement below
the Highest Lawful Rate until the total amount of interest accrued pursuant to this Agreement and
such fees deemed to be interest equals the amount of interest which would have accrued to the
Administrative Agent or such Lender if a varying rate per annum equal to the interest provided
pursuant to Section 3.2 had at all times been in effect, plus the amount of fees
which would have been received but for the effect of this Section. For purposes of Section 303.201
of the Texas Finance Code, as amended, to the extent, if any, applicable to the Administrative
Agent or a Lender, the Borrower agrees that the Highest Lawful Rate shall be the “indicated
(weekly) rate ceiling” as defined in said Section, provided that the Administrative Agent or such
Lender may also rely, to the extent permitted by applicable laws, on alternative maximum rates of
interest under other laws applicable to the Administrative Agent or such Lender if greater.
Chapter 346 of the Texas Finance Code (which regulates

36

 

certain revolving credit loan accounts and revolving tri-party accounts (formerly Tex. Rev.
Civ. Stat. Ann. Art. 5069, Ch. 15)) shall not apply to this Agreement or the other Loan Documents.

ARTICLE V

CONDITIONS

     SECTION 5.1 Effective Date. This Agreement and the obligations of the Lenders to fund
the initial Borrowing and of any Issuing Bank to issue Letters of Credit hereunder shall become
effective on the date on which each of the conditions precedent set forth in this Section
5.1 are satisfied or waived in writing by the Administrative Agent (with the consent of
Required Lenders).

     SECTION 5.1.1 Loan Documents. The Administrative Agent shall have received from each
party hereto either (i) a counterpart of this Agreement and each other required Loan Document
signed on behalf of such party or (ii) written evidence satisfactory to the Administrative Agent
(which may include telecopy transmission of a signed signature page of this Agreement) that such
party has signed a counterpart of this Agreement and each required Loan Document.

     SECTION 5.1.2 Resolutions, etc. The Administrative Agent shall have received from the
Borrower a certificate, dated the Effective Date, of its Secretary or Assistant Secretary as to (a)
resolutions of its Board of Directors then in full force and effect authorizing the execution,
delivery and performance of this Agreement and each other Loan Document to be executed by it; and
(b) the incumbency and signatures of its Authorized Officers, upon which certificate each Lender
may conclusively rely until it shall have received a further certificate of the Secretary of the
Borrower canceling or amending such prior certificate.

     SECTION 5.1.3 Organic Documents, etc. The Administrative Agent shall have received
from the Borrower a certificate, dated the Effective Date, of an Authorized Officer certifying that
attached thereto are true, correct and complete copies of the Organic Documents of the Borrower,
together with all amendments thereto, and a certificate of good standing or equivalent document as
to the Borrower, certified by the appropriate governmental officer in its jurisdiction of
incorporation or formation, as well as any other information required by Section 326 of the USA
Patriot Act or necessary for the Administrative Agent or any Lender to verify the identity of the
Borrower as required by Section 326 of the USA Patriot Act.

     SECTION 5.1.4 Opinion of Counsel. The Administrative Agent shall have received a
favorable opinion, dated the Effective Date and addressed to the Administrative Agent and all
Lenders, from Thompson & Knight L.L.P., counsel to the Borrower, substantially in the form of
Exhibit 5.1.4 hereto.

     SECTION 5.1.5 Fee Letters, Closing Fees, Expenses, etc. The Administrative Agent
shall have received the Fee Letters duly executed by the Borrower. The Administrative Agent shall
also have received for its own account, or for the account of the Arrangers and each Lender, as the
case may be, all fees, costs and expenses due and payable pursuant to Sections 3.3 and
10.3, if then invoiced.

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     SECTION 5.1.6 Material Adverse Change; No Default. There shall have been no material
adverse change in the consolidated business, condition (financial or otherwise), operations,
performance or properties of any of the Borrower and its consolidated Subsidiaries taken as a whole
since September 30, 2006, except as disclosed in Item 5.1.6 (“Material Adverse
Change”) of the Disclosure Schedule. As of the Effective Date, no Default or Event of Default
shall have then occurred and be continuing.

     SECTION 5.1.7 Other Documents. Such other documents as the Administrative Agent may
have reasonably requested.

     SECTION 5.2 All Borrowings. The obligation of each Lender to fund any Borrowing
(including the initial Borrowing) and of any Issuing Bank to issue, amend, renew or extend any
Letters of Credit hereunder (including any initial Letter of Credit) shall be subject to the
satisfaction of each of the conditions precedent set forth in this Section.

     SECTION 5.2.1 Compliance with Warranties, No Default, etc. Both before and after
giving effect to any Borrowing, the following statements shall be true and correct (a) the
representations and warranties set forth in Article VI shall be true and correct with the
same effect as if then made (unless stated to relate solely to an earlier date, in which case such
representations and warranties shall be true and correct as of such earlier date); and (b) no
Default or Event of Default shall have then occurred and be continuing.

     SECTION 5.2.2 Borrowing Request. Each Borrowing and each issuance, amendment, renewal
or extension of a Letter of Credit shall constitute a representation and warranty by the Borrower
that on the date of such Borrowing (both immediately before and after giving effect to such
Borrowing and the application of the proceeds thereof) the statements made in Section 5.2.1
are true and correct.

ARTICLE VI

REPRESENTATIONS AND WARRANTIES

     In order to induce the Lenders and the Administrative Agent to enter into this Agreement and
to make Loans hereunder and to participate in Letters of Credit and to induce each Issuing Bank to
issue Letters of Credit, the Borrower represents and warrants unto the Administrative Agent and
each Lender as set forth in this Article VI.

     SECTION 6.1 Organization, etc. The Borrower and each of its Restricted Subsidiaries
is a corporation, partnership, limited partnership or limited liability company validly organized
and existing and in good standing under the laws of the State of its incorporation, is duly
qualified to do business and is in good standing as a foreign entity in each jurisdiction where the
nature of its business requires such qualification, and has full power and authority and holds all
requisite governmental licenses, permits and other approvals to enter into and perform its
Obligations under this Agreement and each other Loan Document to which it is a party and to conduct
its business substantially as currently conducted by it (except where the failure to be so
qualified to do business or be in good standing or to hold any such licenses, permits and other
approvals would not reasonably be expected to cause a Material Adverse Effect).

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     SECTION 6.2 Due Authorization, Non-Contravention, etc. The execution, delivery and
performance by the Borrower of this Agreement and each other Loan Document executed or to be
executed by it, and the Borrower’s participation in any transaction contemplated herein are within
the Borrower’s powers, have been duly authorized by all necessary corporate action, and do not (a)
contravene the Borrower’s Organic Documents; (b) contravene any material contractual restriction,
law, governmental regulation or court decree or order, in each case binding on or affecting the
Borrower; or (c) result in, or require the creation or imposition of, any Lien on any of the
Borrower’s properties.

     SECTION 6.3 Government Approval, Regulation, etc. No authorization or approval or
other action by, and no notice to or filing with, any governmental authority or regulatory body or
other Person is required for the due execution, delivery or performance by the Borrower of this
Agreement or any other Loan Document to which it is a party, or for the Borrower’s participation in
any transaction contemplated herein, except as have been obtained and remain in full force and
effect. Neither the Borrower nor any of its Subsidiaries is an “investment company” within the
meaning of the Investment Company Act of 1940, as amended.

     SECTION 6.4 Validity, etc. This Agreement constitutes, and each other Loan Document
executed by the Borrower will, on the due execution and delivery thereof, constitute, the legal,
valid and binding obligations of the Borrower enforceable in accordance with their respective terms
except as (i) enforceability thereof may be limited by bankruptcy, insolvency or similar laws
affecting creditor’s rights generally and (ii) rights of acceleration and the availability of
equitable remedies may be limited by equitable principles of general applicability.

     SECTION 6.5 Financial Information. The balance sheets of the Borrower and each of its
consolidated Subsidiaries as at September 30, 2006 and the related statements of earnings and cash
flow, copies of which have been furnished to the Administrative Agent and each Lender, have been
prepared in accordance with GAAP consistently applied, and present fairly the consolidated
financial condition of the corporations covered thereby as at the dates thereof and the results of
their operations for the periods then ended except as disclosed in Item 6.5 (“Financial
Information”) of the Disclosure Schedule.

     SECTION 6.6 No Material Adverse Change. As of the Effective Date, since the date of
the financial statements described in Section 6.5, there has been no material adverse
change in the financial condition, operations, assets, business or properties of the Borrower and
its Restricted Subsidiaries (on a consolidated basis), except as disclosed in Item 5.1.6
(“Material Adverse Change”) of the Disclosure Schedule.

     SECTION 6.7 Litigation, Labor Controversies, etc. As of the Effective Date, there is
no pending or, to the knowledge of the Borrower, threatened litigation, action, proceeding, or
labor controversy affecting the Borrower or any of its Restricted Subsidiaries, or any of their
respective properties, businesses, assets or revenues, which would reasonably be expected to cause
a Material Adverse Effect or which purports to affect the legality, validity or enforceability of,
and the rights and remedies of the Administrative Agent and the Lenders under, this Agreement or
any other Loan Document, except as disclosed in Item 6.7 (“Litigation”) of the Disclosure
Schedule.

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     SECTION 6.8 Subsidiaries. Schedule 6.8 sets forth the name, the identity or
corporate structure and the ownership interest of each direct or indirect Subsidiary as of the
Effective Date. Schedule 6.8 also sets forth the name of each Restricted Subsidiary and
Unrestricted Subsidiary as of the Effective Date. As of the Effective Date, the Borrower does not
have any Subsidiaries other than the Subsidiaries identified in Schedule 6.8.

     SECTION 6.9 Taxes. The Borrower, each of its Restricted Subsidiaries and each of its
Unrestricted Subsidiaries which is a member of the Borrower’s consolidated U.S. federal income tax
group has filed all federal tax returns and reports and all material state tax returns and reports
required by law to have been filed by it and has paid all taxes and governmental charges thereby
shown to be owing, except any such taxes or charges which are being diligently contested in good
faith by appropriate proceedings and for which adequate reserves in accordance with GAAP shall have
been set aside on its books except such returns and taxes for jurisdictions other than the United
States with respect to which the failure to file and pay such taxes would not reasonably be
expected to cause a Material Adverse Effect.

     SECTION 6.10 Pension and Welfare Plans. During the twelve-consecutive-month period
prior to the date of the execution and delivery of this Agreement and prior to the date of any
Borrowing hereunder, no steps have been taken to terminate any Pension Plan, and no contribution
failure has occurred with respect to any Pension Plan sufficient to give rise to a Lien under
section 302(f) of ERISA, in either case which would reasonably be expected to cause a Material
Adverse Effect. No condition exists or event or transaction has occurred with respect to any
Pension Plan which might result in the incurrence by the Borrower or any member of the Controlled
Group of any liability, fine or penalty which would reasonably be expected to cause a Material
Adverse Effect. As of the Effective Date, except as disclosed in Item 6.10 (“Employee
Benefit Plans”) of the Disclosure Schedule, neither the Borrower nor any member of the Controlled
Group has any contingent liability with respect to any post-retirement benefit under a Welfare
Plan, other than liability for continuation coverage described in Part 6 of Title I of ERISA.

     SECTION 6.11 Environmental Warranties and Compliance. The liabilities and costs of
the Borrower and its consolidated Restricted Subsidiaries related to compliance with applicable
Environmental Laws (as in effect on the date on which this representation is made or deemed made)
would not reasonably be expected to cause a Material Adverse Effect.

     SECTION 6.12 Regulation U. None of the Borrower and its Subsidiaries are engaged in
the business of extending credit for the purpose of purchasing or carrying Margin Stock, and no
proceeds of any Loans will be used for a purpose which violates, or would be inconsistent with,
Regulation U.

     SECTION 6.13 Accuracy of Information. No certificate, statement or other information
delivered herewith or hereto by or on behalf of the Borrower in writing to the Administrative Agent
or any Lender in connection with the negotiation of this Agreement or in connection with any
transaction contemplated hereby contains any untrue statement of a fact or omits to state any fact
known to the Borrower or its Subsidiaries necessary to make the statements contained herein or
therein not misleading as of the date made or deemed made, except to the extent that any untrue
statement or omission would not reasonably be expected to

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cause a Material Adverse Effect; provided that, with respect to projected information,
the Borrower only represents that such information was prepared in good faith based upon
assumptions believed to be reasonable at the time.

     SECTION 6.14 Use of Proceeds. The proceeds of each Borrowing shall be used for the
general corporate purposes of the Borrower and its Subsidiaries.

ARTICLE VII

COVENANTS

     SECTION 7.1 Affirmative Covenants. The Borrower agrees with the Administrative Agent
and each Lender that, until all Commitments have terminated and all Obligations have been paid and
performed in full and all Letters of Credit shall have expired or terminated and all LC
Disbursements shall have been reimbursed, the Borrower will perform the obligations set forth in
this Section 7.1.

     SECTION 7.1.1 Financial Information, Reports, Notices, etc. The Borrower will
furnish, or will cause to be furnished, to each Lender and the Administrative Agent copies of the
following financial statements, reports, notices and information:

     (a) as soon as available and in any event within 45 days after the end of each of the first
three Fiscal Quarters of each Fiscal Year of the Borrower, consolidated balance sheets of the
Borrower and its Subsidiaries as of the end of such Fiscal Quarter and consolidated statements of
earnings and cash flow of the Borrower and its Subsidiaries for such Fiscal Quarter and for the
period commencing at the end of the previous Fiscal Year and ending with the end of such Fiscal
Quarter, certified by the chief financial Authorized Officer of the Borrower as having been
prepared in accordance with GAAP;

     (b) as soon as available and in any event within 90 days after the end of each Fiscal Year of
the Borrower, a copy of the annual audit report for such Fiscal Year for the Borrower and its
Subsidiaries, including therein consolidated balance sheets of the Borrower and its Subsidiaries as
of the end of such Fiscal Year and consolidated statements of earnings and cash flow of the
Borrower and its Subsidiaries for such Fiscal Year, in each case certified (without any
Impermissible Qualification) as having been prepared in accordance with GAAP in a manner acceptable
to the Administrative Agent and the Required Lenders by independent public accountants of
recognized national standing;

     (c) as soon as available and in any event at the time of each delivery of financial reports
under subsections (a) and (b) of this Section 7.1.1, a certificate, executed by the chief
financial Authorized Officer of the Borrower, showing (in reasonable detail and with appropriate
calculations and computations in all respects satisfactory to the Administrative Agent) compliance
with the financial covenants set forth in Section 7.2.3;

     (d) promptly, and in any event within three Business Days after an Authorized Officer of the
Borrower or any of its Subsidiaries becomes aware of the existence of the occurrence of each
Default, a statement of the chief executive officer or the chief financial Authorized Officer of
the Borrower setting forth details of such Default and the action which the Borrower has taken and
proposes to take with respect thereto;

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     (e) promptly, and in any event within three Business Days after an Authorized Officer of the
Borrower or any of its Subsidiaries becomes aware of (x) the occurrence of any adverse development
with respect to any litigation, action, proceeding, or labor controversy described in Section
6.7 which would reasonably be expected to cause a Material Adverse Effect, or (y) the
commencement of any material labor controversy, litigation, action, proceeding of the type
described in Section 6.7 which would reasonably be expected to cause a Material Adverse
Effect, notice thereof and copies of all documentation relating thereto requested by the
Administrative Agent or any Lender;

     (f) promptly after the sending or filing thereof, copies of all reports and registration
statements which the Borrower or any of its Subsidiaries files with the Securities and Exchange
Commission or any national securities exchange;

     (g) immediately upon becoming aware of the institution of any steps by the Borrower or any
other Person to terminate any Pension Plan, or the failure to make a required contribution to any
Pension Plan if such failure is sufficient to give rise to a Lien under section 302(f) of ERISA, or
the taking of any action with respect to a Pension Plan which could result in the requirement that
the Borrower furnish a bond or other security to the PBGC or such Pension Plan, or the occurrence
of any event with respect to any Pension Plan which could result in the incurrence by the Borrower
of any liability, fine or penalty, or any increase in the contingent liability of the Borrower with
respect to any post-retirement Welfare Plan benefit which would reasonably be expected to cause a
Material Adverse Effect, notice thereof and copies of all documentation relating thereto; and

     (h) such other information respecting the condition or operations, financial or otherwise, of
the Borrower or any of its Subsidiaries as any Lender through the Administrative Agent may from
time to time reasonably request.

To the extent any documents which are required to be delivered pursuant to Section 7.1.1
are included in materials otherwise filed with the SEC, such documents 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 following website address: www.nobleenergyinc.com; 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 (which may be
by facsimile or electronic mail) the Administrative Agent of the posting of any such documents and
the Administrative Agent shall give prompt notice to the Lenders of the receipt by the
Administrative Agent of such notice. Notwithstanding anything contained herein, in every instance
the Borrower shall be required to provide paper copies of the compliance certificates required by
Section 7.1.1 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

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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.

     SECTION 7.1.2 Compliance with Laws, etc. The Borrower will, and will cause each of
its Subsidiaries to, comply with all Laws, such compliance to include, without limitation: (a) the
maintenance and preservation of its corporate existence and qualification as a foreign corporation,
(b) the payment, before the same become delinquent, of all taxes, assessments and governmental
charges imposed upon it or upon its property except to the extent being diligently contested in
good faith by appropriate proceedings and for which adequate reserves in accordance with GAAP shall
have been set aside on its books and (c) all Environmental Laws; except; in each case, where the
failure to so comply would not reasonably be expected to cause a Material Adverse Effect.

     SECTION 7.1.3 Maintenance of Properties. The Borrower will, and will cause each of
its Restricted Subsidiaries to, maintain, preserve, protect and keep its properties in good repair,
working order and condition (ordinary wear and tear excepted), and make necessary and proper
repairs, renewals and replacements so that its business carried on in connection therewith may be
properly conducted at all times unless the Borrower determines in good faith that the continued
maintenance of any of its properties is no longer economically desirable or unless failure to so
preserve, maintain, protect or keep its properties would not reasonably be expected to cause a
Material Adverse Effect.

     SECTION 7.1.4 Insurance. The Borrower will, and will cause each of its Restricted
Subsidiaries to, maintain or cause to be maintained with responsible insurance companies insurance
with respect to its properties and business against such casualties and contingencies and of such
types and in such amounts as is customary in the case of similar businesses in similar locations.

     SECTION 7.1.5 Books and Records. The Borrower will, and will cause each of its
Subsidiaries to, keep books and records which accurately reflect, in accordance with GAAP, all of
its business affairs and transactions and permit the Administrative Agent or its representatives,
at reasonable times and intervals and upon reasonable prior notice to the Borrower, to visit all of
its offices, to discuss its financial matters with its officers and employees and to examine any of
its books or other corporate records; provided, however, that prior notice to the
Borrower shall not be required if an Event of Default has occurred or is continuing.

     SECTION 7.1.6 Conduct of Business. The Borrower will, and will cause each Restricted
Subsidiary to, cause all material properties and businesses to be regularly conducted, operated,
maintained and developed in a good and workmanlike manner, as would a prudent operator and in
accordance with all applicable federal, state and local laws, rules and regulations, except for any
failure to so operate, maintain and develop that would not reasonably be expected to cause a
Material Adverse Effect.

     SECTION 7.1.7 Subsidiaries; Unrestricted Subsidiaries. The Borrower shall:

     (a) if any additional Subsidiary is formed or acquired after the Effective Date, notify the
Administrative Agent thereof and whether such Subsidiary is an Unrestricted Subsidiary or a
Restricted Subsidiary in compliance with requirements of clauses (i) and (ii) of
Section 7.1.8(b).

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     (b) cause the management, business and affairs of the Borrower and its Restricted Subsidiaries
to be conducted in such a manner (including, without limitation, by keeping separate books of
account, furnishing separate financial statements of Unrestricted Subsidiaries to creditors and
potential creditors thereof and by not permitting Properties of the Borrower and its respective
Subsidiaries to be commingled) so that each Unrestricted Subsidiary that is a corporation will be
treated as a corporate entity separate and distinct from the Borrower and the Restricted
Subsidiaries;

     (c) except as permitted by Section 7.2.5, will not, and will not permit any of the
Restricted Subsidiaries to incur any Guaranteed Liabilities in respect of any Indebtedness of any
of the Unrestricted Subsidiaries; and

     (d) will not permit any Unrestricted Subsidiary to hold any equity or other ownership interest
in, or any Indebtedness of, any Restricted Subsidiary.

     SECTION 7.1.8 Designation and Conversion of Restricted and Unrestricted Subsidiaries.

     (a) Unless designated as an Unrestricted Subsidiary on Schedule 6.8 as of the date of
this Agreement or thereafter in writing to the Administrative Agent pursuant to Section
7.1.7, any Person that becomes a Subsidiary of the Borrower or any of its Restricted
Subsidiaries shall be classified as a Restricted Subsidiary.

     (b) The Borrower may (x) designate any Subsidiary (including a newly formed or newly acquired
Subsidiary) as an Unrestricted Subsidiary or (y) merge a Restricted Subsidiary with an Unrestricted
Subsidiary in which such Restricted Subsidiary is not the surviving entity only if (i) the
representations and warranties of the Borrower and its Restricted Subsidiaries contained in each of
the Loan Documents are true and correct on and as of such date as if made on and as of the date of
such designation or merger (or, if stated to have been made expressly as of an earlier date, were
true and correct as of such date), (ii) after giving effect to such designation or merger, no
Default or Event of Default would exist, and (iii) in the case of a Subsidiary which is already
classified as a Restricted Subsidiary or a merger of a Restricted Subsidiary with an Unrestricted
Subsidiary in which such Restricted Subsidiary is not the surviving entity, the Borrower has
obtained the prior written consent of the Administrative Agent and the Required Lenders to such
designation or merger. Except as provided in this Section, no Restricted Subsidiary may be
designated as an Unrestricted Subsidiary or may merge with an Unrestricted Subsidiary.

     (c) The Borrower may designate any Unrestricted Subsidiary to be a Restricted Subsidiary if
after giving effect to such designation, (i) the representations and warranties of the Borrower and
its Restricted Subsidiaries contained in each of the Loan Documents are true and correct on and as
of such date as if made on and as of the date of such designation (or, if stated to have been made
expressly as of an earlier date, were true and correct as of such date), and (ii) after giving
effect to such designation, no Default or Event of Default would exist.

     SECTION 7.2 Negative Covenants. The Borrower agrees with the Administrative Agent and
each Lender that, until all Commitments have terminated and all Obligations have

44

 

been paid and performed in full and all Letters of Credit shall have expired or terminated and
all LC Disbursements shall have been reimbursed, the Borrower will perform the obligations set
forth in this Section 7.2.

     SECTION 7.2.1 Business Activities. The Borrower will not, and will not permit any of
its Restricted Subsidiaries to, engage in any business activity if, as a result thereof, the
Borrower and its Restricted Subsidiaries taken as a whole would no longer be principally engaged in
the business of oil, gas and energy exploration, development, production, processing and marketing
and such activities as may be incidental or related thereto.

     SECTION 7.2.2 Liens. The Borrower will not, and will not permit any of its Restricted
Subsidiaries to, create, incur, assume or suffer to exist any Lien upon any of its property,
revenues or assets, whether now owned or hereafter acquired, except:

     (a) Liens securing payment of the Obligations, granted pursuant to any Loan Document;

     (b) Liens for taxes, assessments or other governmental charges or levies not at the time
delinquent or thereafter payable without penalty or being diligently contested in good faith by
appropriate proceedings and for which adequate reserves in accordance with GAAP shall have been set
aside on its books;

     (c) Liens of carriers, warehousemen, mechanics, materialmen and landlords incurred in the
ordinary course of business for sums not overdue or being diligently contested in good faith by
appropriate proceedings and for which adequate reserves in accordance with GAAP shall have been set
aside on its books;

     (d) Liens incurred in the ordinary course of business in connection with workmen’s
compensation, unemployment insurance or other forms of governmental insurance or benefits, or to
secure performance of tenders, statutory obligations, leases and contracts (other than for borrowed
money) entered into in the ordinary course of business or to secure obligations on surety or appeal
bonds;

     (e) judgment Liens in existence less than 30 days after the entry thereof or with respect to
which execution has been stayed or the payment of which is covered in full (subject to a customary
deductible) by insurance maintained with responsible insurance companies;

     (f) Liens in favor of the United States of America or any state thereof or any department,
agency, instrumentality or political subdivision of any such jurisdiction to secure partial,
progress, advance or other payments pursuant to any contract or statute;

     (g) Liens required by any contract or statute in order to permit the Borrower or a Restricted
Subsidiary to perform any contract or subcontract made by it with or at the request of the United
States of America, any state or any department, agency or instrumentality or political subdivision
of either;

     (h) Liens which exist prior to the time of acquisition upon any assets acquired by the
Borrower or any Restricted Subsidiary (including Liens on assets of any Person at the time of the

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acquisition of the capital stock or assets of such Person or a merger with or consolidation
with such Person by the Borrower or a Restricted Subsidiary), provided that (i) the Lien
shall attach solely to the assets so acquired (or of the Person so acquired, merged or
consolidated), and (ii) in the case of Liens securing Indebtedness the aggregate principal amount
of all Indebtedness of Restricted Subsidiaries secured by such Liens shall be permitted by the
limitations set forth in Section 7.2.5;

     (i) Liens securing Indebtedness owing by any Restricted Subsidiary to the Borrower;

     (j) Liens under operating agreements, unitization agreements, pooling orders, and similar
arrangements;

     (k) Liens set forth on Schedule 7.2 which are existing on the Effective Date;

     (l) Liens on debt of or equity interests in a Person that is not a Restricted Subsidiary;

     (m) Any extension, renewal or replacement (or successive extensions, renewals or
replacements), in whole or in part, of any Lien referred to in the foregoing clauses of this
Section or of any Indebtedness secured thereby; provided that in the case of Liens securing
Indebtedness, the principal amount of Indebtedness secured thereby shall not exceed the principal
amount of Indebtedness so secured at the time of such extension, renewal or replacement and that
such extension, renewal or replacement Lien shall be limited to all or part of substantially the
same property or revenue subject of the Lien extended, renewed or replaced (plus improvements on
such property); and

     (n) additional Liens upon assets of the Borrower and its Restricted Subsidiaries created after
the date hereof, provided that (i) the aggregate Indebtedness secured thereby and incurred
on or after the date hereof shall not exceed ten percent (10%) of Stockholders’ Equity in the
aggregate at any one time outstanding and (ii) that such Liens do not encumber or attach to any
equity interest in a Restricted Subsidiary.

     SECTION 7.2.3 Financial Covenant — Total Debt to Capitalization. The Borrower will
not permit the Total Debt to Capitalization Ratio, expressed as a percentage, to exceed 60% at any
time.

     SECTION 7.2.4 Restricted Payments, etc. On and at all times after the Effective Date,
the Borrower will not declare, pay or make any dividend or distribution (in cash, property or
obligations) on any shares of any class of capital stock (now or hereafter outstanding) of the
Borrower or on any warrants, options or other rights with respect to any shares of any class of
capital stock (now or hereafter outstanding) of the Borrower (other than dividends or distributions
payable in its common stock or warrants to purchase its common stock or splitups or
reclassifications of its stock into additional or other shares of its common stock) or apply, or
permit any of its Restricted Subsidiaries to apply, any of its funds, property or assets to the
purchase, redemption, sinking fund or other retirement of, or agree or permit any of its Restricted
Subsidiaries to purchase or redeem, any shares of any class of capital stock (now or hereafter
outstanding) of the Borrower, or warrants, options or other rights with respect to any shares of
any class of capital stock (now or hereafter outstanding) of the Borrower, if, after giving effect
thereto, an Event of Default shall have occurred and be continuing or been caused thereby.

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     SECTION 7.2.5 Indebtedness. The Borrower will not permit any of its Restricted
Subsidiaries to contract, create, incur or assume any Indebtedness, except:

     (i) Indebtedness of a Restricted Subsidiary owed to the Borrower or an other Restricted
Subsidiary;

     (ii) Indebtedness of a Restricted Subsidiary which exists prior to the time of the
acquisition of such Subsidiary by the Borrower or any Restricted Subsidiary (including
Indebtedness at the time of the acquisition of the capital stock or assets of such Person or
a merger with or consolidation with such Person by the Borrower or a Restricted Subsidiary)
and any extensions, renewals or replacements of such Indebtedness, provided that the
aggregate principal amount of such Indebtedness and any extensions, renewals or replacements
thereof shall not exceed the principal amount of such Indebtedness at the time such Person
becomes a Subsidiary; and

     (iii) other Indebtedness in an aggregate amount not to exceed an amount equal to five
percent (5%) of Stockholders’ Equity.

     SECTION 7.2.6 Consolidation, Merger, etc. The Borrower will not liquidate or
dissolve, nor consolidate with, or merge into or with, any other Person except (a) any Restricted
Subsidiary and (b) so long as no Event of Default has occurred and is continuing or would occur
after giving effect thereto, any other Person, in either case so long as the Borrower is the
surviving entity.

     SECTION 7.2.7 Negative Pledges, Restrictive Agreements, etc. The Borrower will not,
and will not permit any of its Restricted Subsidiaries to, enter into any agreement (excluding this
Agreement, any other Loan Document and any agreement governing any Indebtedness not prohibited
under this Agreement) prohibiting the creation or assumption of any Lien upon its material
properties, revenues or assets, whether now owned or hereafter acquired, or the ability of the
Borrower to amend or otherwise modify this Agreement or any other Loan Document. The foregoing
shall not prohibit agreements entered into or acquired in the ordinary course of business regarding
specific properties or assets which restrict or place conditions on the transfer of, or the
creation of a Lien on such properties or assets or the revenues derived therefrom, but which do not
affect other unrelated properties, assets or revenues. The Borrower will not and will not permit
any of its Restricted Subsidiaries to enter into any agreement prohibiting the ability of any
Restricted Subsidiary to make any payments, directly or indirectly, to the Borrower by way of
dividends, advances, repayments of loans or advances, reimbursements of management and other
intercompany charges, expenses and accruals or other returns on investments, or any other agreement
or arrangement which restricts the ability of any such Restricted Subsidiary to make any payment,
directly or indirectly, to the Borrower.

ARTICLE VIII

EVENTS OF DEFAULT

     SECTION 8.1 Listing of Events of Default. Each of the following events or occurrences
described in this Section 8.1 shall constitute an “Event of Default”.

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     SECTION 8.1.1 Non-Payment of Obligations. The Borrower shall default in the payment
or prepayment when due of any principal of any Loan or any reimbursement obligation in respect of
any LC Disbursement, or the Borrower shall default (and such default shall continue unremedied for
a period of five days) in the payment when due of any interest on any Loan, of any fee hereunder or
of any other Obligation.

     SECTION 8.1.2 Breach of Warranty. Any representation or warranty of the Borrower made
or deemed to be made hereunder or in any other Loan Document executed by it or any certificates
delivered pursuant to Article V is or shall be incorrect in any material respect when made
or deemed made.

     SECTION 8.1.3 Non-Performance of Certain Covenants and Obligations. The Borrower
shall default in the due performance and observance of any of its obligations under Sections
7.1.1(d), 7.2.2, 7.2.3, 7.2.6 or 7.2.7; provided that
the imposition of any non-consensual Lien that is not permitted to exist pursuant to Section
7.2.2 shall not be deemed to constitute an Event of Default hereunder until thirty (30) days
after the date of such imposition.

     SECTION 8.1.4 Non-Performance of Other Covenants and Obligations. The Borrower shall
default in the due performance and observance of any other provision contained herein (not
constituting an Event of Default under the preceding provisions of this Section 8.1) or any
other Loan Document executed by it, and such default shall continue unremedied for a period of 30
days after notice thereof shall have been given to the Borrower by the Administrative Agent.

     SECTION 8.1.5 Default on Other Indebtedness. A default shall occur in the payment
when due (subject to any applicable grace period), whether by acceleration or otherwise, of any
Indebtedness (other than Indebtedness described in Section 8.1.1) of the Borrower or any of
its Restricted Subsidiaries, or of any reimbursed obligation in respect of letters of credit for
which the Borrower or any of its Restricted Subsidiaries is an account party, in any case having a
principal amount, individually or in the aggregate, in excess of $75,000,000, or a default shall
occur in the performance or observance of any obligation or condition with respect to such
Indebtedness or reimbursement obligation if the effect of such default is to accelerate the
maturity of any such Indebtedness or reimbursement obligation or such default shall continue
unremedied for any applicable period of time sufficient to permit the holder or holders of such
Indebtedness or reimbursement obligation, or any trustee or agent for such holders, to cause such
Indebtedness to become due and payable prior to its expressed maturity.

     SECTION 8.1.6 Judgments. Any judgment or order for the payment of money in excess of
$75,000,000 shall be rendered against the Borrower or any of its Restricted Subsidiaries if such
excess is not fully covered by valid and collectible insurance in respect thereof, the payment of
which is not being disputed or contested by the insurer or the insurers, and either (i) proper or
valid enforcement or levying proceedings shall have been commenced by any creditor upon such
judgment or order or (ii) such judgment or order shall continue unsatisfied and unstayed for a
period of thirty (30) consecutive days.

     SECTION 8.1.7 Pension Plans. Any of the following events shall occur with respect to
any Pension Plan (a) the institution of any steps by the Borrower, any member of its

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Controlled Group or any other Person to terminate a Pension Plan if, as a result of such
termination, the Borrower or any such member could be required to make a contribution to such
Pension Plan in excess of $75,000,000; or (b) a contribution failure occurs with respect to any
Pension Plan sufficient to give rise to a Lien under section 302(f) of ERISA to the extent such
action would reasonably be expected to cause a Material Adverse Effect.

     SECTION 8.1.8 Change in Control. Any Change in Control shall occur.

     SECTION 8.1.9 Bankruptcy, Insolvency, etc. The Borrower or any of its Restricted
Subsidiaries shall (a) become insolvent or generally fail to pay, or admit in writing its inability
or unwillingness to pay, debts as they become due; (b) apply for, consent to, or acquiesce in, the
appointment of a trustee, receiver, sequestrator or other custodian for the Borrower or any of its
Restricted Subsidiaries or any substantial portion of the property of any thereof, or make a
general assignment for the benefit of creditors; (c) in the absence of such application, consent or
acquiescence, permit or suffer to exist the appointment of a trustee, receiver, sequestrator or
other custodian for the Borrower or any of its Restricted Subsidiaries or for a substantial part of
the property of any thereof, and such trustee, receiver, sequestrator or other custodian shall not
be discharged within 60 days, provided that the Borrower and each Restricted Subsidiary hereby
expressly authorizes the Administrative Agent and each Lender to appear in any court conducting any
relevant proceeding during such 60-day period to preserve, protect and defend their rights under
the Loan Documents; (d) permit or suffer to exist the commencement of any bankruptcy,
reorganization, debt arrangement or other case or proceeding under any bankruptcy or insolvency
law, or any dissolution, winding up or liquidation proceeding, in respect of the Borrower or any of
its Restricted Subsidiaries, and, if any such case or proceeding is not commenced by the Borrower
or such Subsidiary, such case or proceeding shall be consented to or acquiesced in by the Borrower
or such Restricted Subsidiary or shall result in the entry of an order for relief or shall remain
for 60 days undismissed, provided that the Borrower and each Restricted Subsidiary hereby expressly
authorizes the Administrative Agent and each Lender to appear in any court conducting any such case
or proceeding during such 60-day period to preserve, protect and defend their rights under the Loan
Documents; or (e) take any corporate action authorizing, or in furtherance of, any of the
foregoing.

     SECTION 8.2 Action if Bankruptcy. If any Event of Default described in Section
8.1.9 shall occur with respect to the Borrower or any Restricted Subsidiary, the Commitments
(if not theretofore terminated) shall automatically terminate and the outstanding principal amount
of all outstanding Borrowings and all other Obligations shall automatically be and become
immediately due and payable, without notice or demand.

     SECTION 8.3 Action if Other Event of Default. If any Event of Default (other than any
Event of Default described in Section 8.1.9 with respect to the Borrower or any Restricted
Subsidiary) shall occur for any reason, whether voluntary or involuntary, and be continuing, the
Administrative Agent, upon the direction of the Required Lenders, shall by notice to the Borrower
declare all or any portion of the outstanding principal amount of the Borrowings and other
Obligations to be due and payable and/or the Commitments (if not theretofore terminated) to be
terminated, whereupon the full unpaid amount of such Loans and other Obligations which shall be so
declared due and payable shall be and become immediately due and payable, without

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further notice, demand or presentment, as the case may be, and/or the Commitments shall
terminate.

ARTICLE IX

THE AGENTS

     SECTION 9.1 Actions. Each Lender and each Issuing Bank hereby appoints (i) JPMCB as
the Administrative Agent under this Agreement and each other Loan Document, (ii) WACHOVIA BANK,
NATIONAL ASSOCIATION and THE ROYAL BANK OF SCOTLAND PLC, as Co-Syndication Agents under this
Agreement and each other Loan Document, and (iii) DEUTSCHE BANK SECURITIES INC., CITIBANK, N.A. and
THE BANK OF TOKYO-MITSUBISHI UFJ, LTD., as Co-Documentation Agents under this Agreement and each
other Loan Document. Each Lender authorizes the Administrative Agent to act on behalf of such
Lender under this Agreement and each other Loan Document and, in the absence of other written
instructions from the Required Lenders received from time to time by the Administrative Agent (with
respect to which the Administrative Agent agrees that it will comply, except as otherwise provided
in this Section or as otherwise advised by counsel), to exercise such powers hereunder and
thereunder as are specifically delegated to or required of the Administrative Agent by the terms
hereof and thereof, together with such powers as may be reasonably incidental thereto. Each Lender
acknowledges that none of the Co-Syndication Agents or the Co-Documentation Agents have any duties
or obligations under this Agreement or any other Loan Document in connection with their capacity as
either a Co-Syndication Agent or a Co-Documentation Agent, respectively. Each Lender hereby
indemnifies (which indemnity shall survive any termination of this Agreement) each of the Agents,
pro rata according to such Lender’s Percentage, WHETHER OR NOT RELATED TO ANY
SINGULAR, JOINT OR CONCURRENT NEGLIGENCE OF THE AGENTS, from and against any and all liabilities,
obligations, losses, damages, claims, costs or expenses of any kind or nature whatsoever which may
at any time be imposed on, incurred by, or asserted against, any Agent in any way relating to or
arising out of this Agreement and any other Loan Document, including reasonable attorneys’ fees,
and as to which such Agent is not reimbursed by the Borrower; provided, however,
that no Lender shall be liable for the payment of any portion of such liabilities, obligations,
losses, damages, claims, costs or expenses which are determined by a court of competent
jurisdiction in a final proceeding to have resulted solely from such Agent’s gross negligence or
willful misconduct. None of the Agents shall be required to take any action hereunder or under any
other Loan Document, or to prosecute or defend any suit in respect of this Agreement or any other
Loan Document, unless it is indemnified hereunder to its satisfaction. If any indemnity in favor
of any Agent shall be or become inadequate, in such Agent’s determination, as the case may be, such
Agent may call for additional indemnification from the Lenders and cease to do the acts indemnified
against hereunder until such additional indemnity is given. Notwithstanding any provision to the
contrary contained elsewhere in this Agreement or in any other Loan Document, none of the Agents
shall have any duties or responsibilities, except as expressly set forth herein, nor shall any of
the Agents have or be deemed to have any fiduciary relationship with any Lender, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against any of the Agents.

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     SECTION 9.2 Funding Reliance, etc. Unless the Administrative Agent shall have been
notified by telephone, confirmed in writing, by any Lender by 5:00 p.m., Central time, on the day
prior to a Borrowing (except with respect to a Borrowing comprised of Base Rate Loans, in which
case notice shall be given no later than 12:00 noon, Central time, on the date of the proposed
Borrowing) that such Lender will not make available the amount which would constitute its
Percentage of such Borrowing on the date specified therefor, the Administrative Agent may assume
that such Lender has made such amount available to the Administrative Agent and, in reliance upon
such assumption, make available to the Borrower a corresponding amount. If and to the extent that
such Lender shall not have made such amount available to the Administrative Agent, such Lender and
the Borrower severally agree to repay the Administrative Agent forthwith on demand such
corresponding amount together with interest thereon, for each day from the date the Administrative
Agent made such amount available to the Borrower to the date such amount is repaid to the
Administrative Agent, at the Federal Funds Rate.

     SECTION 9.3 Exculpation. None of the Agents and their respective directors, officers,
employees or agents shall be liable to any Lender for any action taken or omitted to be taken by it
under this Agreement or any other Loan Document, or in connection herewith or therewith, except for
its own willful misconduct or gross negligence, nor responsible for any recitals or warranties
herein or therein, nor for the effectiveness, enforceability, validity or due execution of this
Agreement or any other Loan Document, nor to make any inquiry respecting the performance by the
Borrower of its obligations hereunder or under any other Loan Document. Any such inquiry which may
be made by any Agent shall not obligate it to make any further inquiry or to take any action. Each
of the Agents shall be entitled to rely upon advice of counsel concerning legal matters and upon
any notice, consent, certificate, statement or writing which such Agent believes to be genuine and
to have been presented by a proper Person.

     SECTION 9.4 Successor. Any of the Agents may resign as such at any time upon at least
30 days’ prior notice to the Borrower and all Lenders. If the Administrative Agent at any time
shall resign, the Required Lenders may appoint another Lender as the successor Administrative Agent
which shall thereupon become the Administrative Agent hereunder. If no successor Administrative
Agent shall have been so appointed by the Required Lenders, and shall have accepted such
appointment, within 30 days after the retiring Administrative Agent’s giving notice of resignation,
then the retiring Administrative Agent may, on behalf of the Lenders and the Issuing Banks, appoint
a successor Administrative Agent, which shall be one of the Lenders or a commercial banking
institution organized under the laws of the U.S. (or any State thereof) or a U.S. branch or agency
of a commercial banking institution, and having a combined capital and surplus of at least
$500,000,000. Upon the acceptance of any appointment as the Administrative Agent hereunder by a
successor Administrative Agent, such successor Administrative Agent shall be entitled to receive
from the retiring Administrative Agent such documents of transfer and assignment as such successor
Administrative Agent may reasonably request, and shall thereupon succeed to and become vested with
all rights, powers, privileges and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations under this Agreement.
After a retiring Administrative Agent’s resignation hereunder as a Administrative Agent, the
provisions of this Article IX shall inure to its benefit as to any actions taken or omitted
to be taken by it while it was the Administrative Agent under this Agreement, and Section
10.4 (and, with respect to the Administrative Agent, Section 10.3) shall continue to
inure to its benefit.

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     SECTION 9.5 Loans by the Agents. Each of the Agents shall have the same rights and
powers with respect to the Loans made by it or any of its Affiliates and may exercise the same as
if it were not an Agent. Each of the Agents and its Affiliates may accept deposits from, lend
money to, and generally engage in any kind of business with the Borrower or any Subsidiary or
Affiliate of the Borrower as if it were not an Agent hereunder.

     SECTION 9.6 Credit Decisions. Each Lender and Issuing Bank acknowledges that it has
made its own credit decision to extend its Commitments hereunder (i) independently of each of the
Agents, each other Lender and each other Issuing Bank, and (ii) based on such Lender’s or Issuing
Bank’s review of the financial information of the Borrower, this Agreement, the other Loan
Documents (the terms and provisions of which being satisfactory to such Lender) and such other
documents, information and investigations as such Lender has deemed appropriate. Each Lender and
Issuing Bank also acknowledges that it will continue to make its own credit decisions as to
exercising or not exercising from time to time any rights and privileges available to it under this
Agreement or any other Loan Document (i) independently of each of the Agents, each other Lender and
each other Issuing Bank, and (ii) based on such other documents, information and investigations as
it shall deem appropriate at any time.

     SECTION 9.7 Copies, etc. The Administrative Agent shall give prompt notice to each
Lender of each notice or request required or permitted to be given to the Administrative Agent by
the Borrower pursuant to the terms of this Agreement (unless concurrently delivered to the Lenders
by the Borrower). The Administrative Agent will distribute to each Lender each document or
instrument received for its account and copies of all other communications received by the
Administrative Agent from the Borrower for distribution to the Lenders by the Administrative Agent
in accordance with the terms of this Agreement.

ARTICLE X

MISCELLANEOUS PROVISIONS

     SECTION 10.1 Waivers, Amendments, etc. The provisions of this Agreement and of each
other Loan Document may from time to time be amended, modified or waived, if such amendment,
modification or waiver is in writing and consented to by the Borrower and the Required Lenders;
provided, however, that no such amendment, modification or waiver which would: (a)
modify any requirement hereunder that any particular action be taken by all the Lenders or by the
Required Lenders shall be effective unless consented to by each Lender; (b) modify the first
sentence of Section 4.8, Section 4.9 or this Section 10.1, change the
definition of “Required Lenders”, reduce any fees described in Article III or,
except in the manner set forth in Section 2.10, extend the Maturity Date, shall be made
without the consent of each Lender; (c) except in the manner set forth in Section 2.10,
extend the due date for, or reduce the amount of, any scheduled repayment or prepayment of
principal of or interest on any Loan or LC Disbursement (or reduce the principal amount of or rate
of interest on any Loan or LC Disbursement) shall be made without the consent of the Lender which
made such Loan or is otherwise affected thereby; or (d) affect adversely the interests, rights or
obligations of any Agent as an Agent shall be made without the consent of such Agent;
provided, further, that no such amendment, modification or waiver which would
either increase any Commitment, the Commitment Amount or the Percentage of any Lender, or modify
the rights, duties or obligations of any Agent, Issuing Bank or the Swingline Lender, shall be
effective without the consent of

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such Lender, such Agent, such Issuing Bank or such Swingline Lender, as applicable. No
failure or delay on the part of the Administrative Agent, any Lender, any Issuing Bank or Swingline
Lender in exercising any power or right under this Agreement or any other Loan Document shall
operate as a waiver thereof, nor shall any single or partial exercise of any such power or right
preclude any other or further exercise thereof or the exercise of any other power or right. No
notice to or demand on the Borrower in any case shall entitle it to any notice or demand in similar
or other circumstances. No waiver or approval by the Administrative Agent, any Lender, any Issuing
Bank or Swingline Lender under this Agreement or any other Loan Document shall, except as may be
otherwise stated in such waiver or approval, be applicable to subsequent transactions. No waiver
or approval hereunder shall require any similar or dissimilar waiver or approval thereafter to be
granted hereunder.

     SECTION 10.2 Notices.

     (a) Except in the case of notices and other communications expressly permitted to be given by
telephone, 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 telecopy, as follows:

     (i) if to the Borrower, to:

Noble Energy, Inc.

350 Glenborough, Suite 100

Houston, TX 77067

	 	 	 
	Attention:

	 	 Gerald Stevenson
	Telephone No.:

	 	(281) 872-3107
	Facsimile No.:

	 	(281) 872-3121

     (ii) if to the Administrative Agent, to:

JPMorgan Chase Bank, N.A.

Agency Services

1111 Fannin Street, 10th Floor

Houston, Texas 77002

	 	 	 
	Attention:

	 	Rose Salvacion
	Telephone No.:

	 	(713) 750-2501
	Facsimile No.:

	 	(713) 427-6307

With a copy to:

JPMorgan Chase Bank, N.A.

Global Oil & Gas Group

712 Main Street, 12th Floor

Houston, Texas 77002

	 	 	 
	Attention:

	 	Peter Licalzi
	Telephone No.:

	 	713-216-8869
	Facsimile No.:

	 	713-216-4117

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And in connection with business-related matters, with a copy to:

JPMorgan Chase Bank, N.A.

Global Oil & Gas Group

712 Main Street, 12th Floor

Houston, Texas 77002

	 	 	 
	Attention:

	 	Kevin Utsey
	Telephone No.:

	 	713-216-4110
	Facsimile No.:

	 	713-216-8870

     (iii) if to any Co-Syndication Agent, any Co-Documentation Agent, any Issuing Bank, the
Swingline Lender or any other Lender, to it at its address (or telecopy number) provided to
the Administrative Agent and the Borrower or as set forth in its Administrative
Questionnaire.

     (b) Notices and other communications to the Lenders, Issuing Bank or Swingline Lender
hereunder may be delivered or furnished by electronic communications pursuant to procedures
approved by the Administrative Agent; provided that the foregoing shall not apply to
notices pursuant to Article II unless otherwise agreed by the Administrative Agent and the
applicable Lender, Issuing Bank or Swingline Lender. The Administrative Agent or the Borrower may,
in its discretion, agree to accept notices and other communications to it hereunder by electronic
communications pursuant to procedures approved by it; provided that approval of such procedures may
be limited to particular notices or communications.

     (c) Any party hereto may change its address or telecopy number for notices and other
communications hereunder by notice to the other parties hereto. All notices and other
communications given to any party hereto in accordance with the provisions of this Agreement shall
be deemed to have been given on the date of receipt.

     SECTION 10.3 Payment of Costs, Expenses and Taxes. The Borrower agrees to pay on
demand all reasonable out-of-pocket costs and expenses of (i) the Administrative Agent (including,
without limitation, the reasonable fees and out-of-pocket expenses of Mayer, Brown, Rowe & Maw LLP)
in connection with the preparation, negotiation, execution, delivery, syndication and
administration of this Agreement and of each other Loan Document, including schedules and exhibits,
and any amendments, waivers, consents, supplements or other modification to this Agreement or any
other Loan Document, (ii) an Issuing Bank in connection with the issuance, amendment, renewal or
extension of any Letter of Credit or any demand for payment thereunder, (iii) the Swingline Lender
in connection with the making of any Swingline Loan or any demand for payment thereunder, and (iv)
the Administrative Agent, any Issuing Bank, the Swingline Lender and the Lenders in connection with
the enforcement by the Lenders, any Issuing Bank, the Swingline Lender or the Administrative Agent
of, or the protection of rights under, this Agreement and each other Loan Document. The
Administrative Agent, the other Agents, the Arranger, each Issuing Bank, the Swingline Lender and
each Lender agree to the extent feasible, and to the extent a conflict of interest does not exist
in the reasonable opinion of the Administrative Agent, the other Agents, the Arranger, any Issuing
Bank, the Swingline Lender or any Lender, to use one law firm in each jurisdiction in connection
with the foregoing, to the extent they seek reimbursement for the expenses thereof from the
Borrower. Each Lender

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agrees to reimburse the Administrative Agent, each Issuing Bank and the Swingline Lender on
demand for such Lender’s pro rata share (based upon its respective Percentage) of
any such costs or expenses not paid by the Borrower. In addition, the Borrower agrees to pay, and
to save the Administrative Agent, the other Agents, the Arranger, any Issuing Bank, the Swingline
Lender and the Lenders harmless from all liability for, any stamp or other taxes which may be
payable in connection with the execution or delivery of this Agreement, the Borrowings hereunder,
or of any other instruments or documents provided for herein or delivered or to be delivered
hereunder or in connection herewith.

     SECTION 10.4 Indemnification. In consideration of the execution and delivery of this
Agreement by each Lender, Issuing Bank and the Swingline Lender and the extension of the
Commitments, the Borrower hereby indemnifies, exonerates and holds each Agent, the Arranger, each
Issuing Bank, the Swingline Lender and each Lender and each of their respective officers,
directors, employees and agents (collectively, the “Indemnified Parties”), WHETHER OR NOT
RELATED TO ANY NEGLIGENCE OF THE INDEMNIFIED PARTIES, free and harmless from and against any and
all actions, causes of action, suits, losses, costs, liabilities and damages, and expenses incurred
in connection therewith (irrespective of whether any such Indemnified Party is a party to the
action for which indemnification hereunder is sought), whether brought by a third party or by the
Borrower and regardless of whether any Indemnified Party is a party thereto, including reasonable
attorneys’ fees and disbursements (collectively, the “Indemnified Liabilities”), incurred
by the Indemnified Parties or any of them as a result of, or arising out of, or relating to any
transaction financed or to be financed in whole or in part, directly or indirectly, with the
proceeds of any Loan or Letter of Credit; the entering into and performance of this Agreement and
any other Loan Document by any of the Indemnified Parties; any Loan or Letter of Credit or the use
of the proceeds therefrom (including any refusal by an Issuing Bank 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), any investigation, litigation or proceeding
related to any acquisition or proposed acquisition by the Borrower or any of its Restricted
Subsidiaries of all or any portion of the stock or assets of any Person, whether or not such Agent,
the Arranger, such Issuing Bank, such Swingline Lender or such Lender is party thereto; any
investigation, litigation or proceeding related to any environmental cleanup, audit, compliance or
other matter relating to the protection of the environment or the Release by the Borrower or any of
its Restricted Subsidiaries of any Hazardous Material; or the presence on or under, or the escape,
seepage, leakage, spillage, discharge, emission, discharging or releases from, any real property
owned or operated by the Borrower or any Subsidiary thereof of any Hazardous Material (including
any losses, liabilities, damages, injuries, costs, expenses or claims asserted or arising under any
Environmental Law), regardless of whether caused by, or within the control of, the Borrower or such
Subsidiary; provided that such indemnity shall not, as to any Indemnified Party, 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 Indemnified Party or (y) result
from a claim brought by the Borrower or any Subsidiary against an Indemnified Party for breach in
bad faith of such Indemnified Party’s obligations hereunder or under any other Loan Document, if
the Borrower or such Subsidiary has obtained a final and nonappealable judgment in its favor on
such claim as determined by a court of competent jurisdiction. If and to the extent that the
foregoing undertaking may be unenforceable for any reason, the Borrower hereby agrees to make the

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maximum contribution to the payment and satisfaction of each of the Indemnified Liabilities
which is permissible under applicable law.

     SECTION 10.5 Survival. The obligations of the Borrower under Sections 4.3,
4.4, 4.5, 4.6, 10.3 and 10.4, and the obligations of the
Lenders under Section 9.1, shall in each case survive any termination of this Agreement,
the payment in full of all Obligations and the termination of all Commitments.

     SECTION 10.6 Severability. Any provision of this Agreement or any other Loan Document
which is prohibited or unenforceable in any jurisdiction shall, as to such provision and such
jurisdiction, be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions of this Agreement or such Loan Document or affecting the
validity or enforceability of such provision in any other jurisdiction.

     SECTION 10.7 Headings. The various headings of this Agreement and of each other Loan
Document are inserted for convenience only and shall not affect the meaning or interpretation of
this Agreement or such other Loan Document or any provisions hereof or thereof.

     SECTION 10.8 Governing Law; Entire Agreement. THIS AGREEMENT AND EACH OTHER LOAN
DOCUMENT SHALL EACH BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE
STATE OF TEXAS, WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS OF LAWS. This Agreement and the
other Loan Documents constitute the entire understanding among the parties hereto with respect to
the subject matter hereof and supersede any prior agreements, written or oral, with respect
thereto.

     SECTION 10.9 Successors and Assigns. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective successors and assigns (including
any Affiliate of an Issuing Bank that issues any Letter of Credit); provided,
however, that: (a) the Borrower may not assign or transfer its rights or obligations
hereunder without the prior written consent of the Administrative Agent and all Lenders; and (b)
the rights of sale, assignment and transfer of the Lenders are subject to Section 10.10.

     SECTION 10.10 Sale and Transfer of Loans and Commitments; Participations in Loans and
Commitments. Each Lender may assign, or sell participations in, its Loans and Commitments to
one or more other Persons in accordance with this Section.

     SECTION 10.10.1 Assignments. Any Lender (a) with the written consent of the Borrower
(provided that the consent of the Borrower shall not be required if an Event of Default has
occurred and is continuing) and the Administrative Agent and each Issuing Bank (which consent of
the Borrower, if applicable, and the Administrative Agent and such Issuing Banks shall not be
unreasonably delayed or withheld), may at any time assign and delegate to one or more commercial
banks or other financial institutions, and (b) with notice to the Borrower and the Administrative
Agent, but without the consent of the Borrower, the Administrative Agent or the Issuing Banks, may
assign and delegate to any of its Affiliates or to any other Lender, Lender Affiliate or Approved
Fund (each Person described in either of the foregoing clauses as being the

56

 

Person to whom such assignment and delegation is to be made, being hereinafter referred to as
an “Assignee Lender”), all or any fraction of such Lender’s total Loans and Commitments
(which assignment and delegation shall be of a constant, and not a varying, percentage of all the
assigning Lender’s Loans and Commitments and which shall be of equal pro rata
shares of the Facility) in a minimum aggregate amount of $5,000,000 (or in a minimum amount of
$1,000,000 in the case of an assignment to an Approved Fund with respect to which such Approved
Fund plus the Lender or an Affiliate of such Lender who administers or manages such Approved Fund
plus other Approved Funds administered or managed by the such Lender or an Affiliate of such Lender
will then hold an amount of $5,000,000 or more); provided, however, that any such
Assignee Lender will comply, if applicable, with the provisions contained in the last sentence of
Section 4.6 and further, provided, however, that, the Borrower and
the Administrative Agent shall be entitled to continue to deal solely and directly with such Lender
in connection with the interests so assigned and delegated to an Assignee Lender until (i) written
notice of such assignment and delegation, together with payment instructions, addresses and related
information with respect to such Assignee Lender, shall have been given to the Borrower and the
Administrative Agent by such Lender and such Assignee Lender, (ii) such Assignee Lender shall have
executed and delivered to the Borrower and the Administrative Agent a Lender Assignment Agreement,
accepted by the Administrative Agent, (iii) such Assignee Lender shall have delivered to the
Administrative Agent an Administrative Questionnaire, and (iii) the processing fees described below
shall have been paid. For the purposes of this Section 10.10.1, the term “Approved Fund”
has the following meaning:

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

     From and after the date that the Administrative Agent accepts such Lender Assignment
Agreement, (x) the Assignee Lender thereunder shall be deemed automatically to have become a party
hereto and to the extent that rights and obligations hereunder have been assigned and delegated to
such Assignee Lender in connection with such Lender Assignment Agreement, shall have the rights and
obligations of a Lender hereunder and under the other Loan Documents, and (y) the assignor Lender,
to the extent that rights and obligations hereunder have been assigned and delegated by it in
connection with such Lender Assignment Agreement, shall be released from its obligations hereunder
and under the other Loan Documents. Accrued interest on that part of the predecessor Loans and
Commitments, and accrued fees, shall be paid as provided in the Lender Assignment Agreement.
Accrued interest on that part of the predecessor Loans and Commitments shall be paid to the
assignor Lender. Accrued interest and accrued fees shall be paid at the same time or times
provided in this Agreement. Such assignor Lender or such Assignee Lender must also pay a
processing fee to the Administrative Agent upon delivery of any Lender Assignment Agreement in the
amount of $3,500. Any attempted assignment and delegation not made in accordance with this Section
shall be null and void.

     SECTION 10.10.2 Participations. Any Lender may at any time sell to one or more
commercial banks or other Persons (each of such commercial banks and other Persons being herein
called a “Participant”) participating interests in any of the Loans, Commitments or other

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interests of such Lender hereunder; provided, however, that (a) no
participation contemplated in this Section 10.10 shall relieve such Lender from its
Commitments or its other obligations hereunder or under any other Loan Document, (b) such Lender
shall remain solely responsible for the performance of its Commitments and such other obligations,
(c) the Borrower and the Administrative Agent shall continue to deal solely and directly with such
Lender in connection with such Lender’s rights and obligations under this Agreement and each of the
other Loan Documents, (d) no Participant, unless such Participant is an Affiliate of such Lender,
or is itself a Lender, shall be entitled to require such Lender to take or refrain from taking any
action hereunder or under any other Loan Document, except that such Lender may agree with any
Participant that such Lender will not, without such Participant’s consent, take any actions of the
type described in clause (b) or (c) of Section 10.1, and (e) the Borrower
shall not be required to pay any amount under Section 4.6 that is greater than the amount
which it would have been required to pay had no participating interest been sold. The Borrower
acknowledges and agrees that each Participant, for purposes of Sections 4.3, 4.4,
4.5, 4.6, 4.7, 4.8, 4.9 and 10.4, shall be
considered a Lender; provided that this sentence shall not obligate the Borrower to pay more under
such Sections that it would be obligated to pay had no such participation been granted.

     SECTION 10.10.3 Pledge by Lender. Any Lender may at any time pledge or assign a
security interest in all or any portion of its rights under this Agreement to secure obligations of
such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank,
and this Section shall not apply to any such pledge or assignment of a security interest;
provided that no such pledge or assignment of a security interest shall release a Lender
from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as
a party hereto.

     SECTION 10.11 Other Transactions. Nothing contained herein shall preclude the
Administrative Agent or any other Lender from engaging in any transaction, in addition to those
contemplated by this Agreement or any other Loan Document, with the Borrower or any of its
Affiliates in which the Borrower or such Affiliate is not restricted hereby from engaging with any
other Person.

     SECTION 10.12 Confidentiality. Each of the Agents, the Issuing Banks and the Lenders
agrees to maintain the confidentiality of the Information (as defined below), except that
Information may be disclosed (a) to its and its Affiliates’ directors, officers, employees and
agents, including accountants, legal counsel and other advisors (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 or self-regulatory body, (c) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process, (d) to any other party to this Agreement,
(e) in connection with the exercise of any remedies hereunder or any suit, action or proceeding
relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or
thereunder, (f) subject to an agreement containing provisions substantially the same as those of
this Section, to (i) any assignee of or Participant in, or any prospective assignee of or
Participant in, any of its rights or obligations under this Agreement or (ii) any actual or
prospective counterparty (or its advisors) to any hedging agreement, (g) with the consent of
Borrower or (h) to the extent such Information (i) becomes publicly available other than as a
result of a breach of this Section by any Person or (ii) becomes available to any Agent or any

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Lender on a nonconfidential basis from a source other than Borrower or any of its Affiliates.
For the purposes of this Section, “Information” means all information received from
Borrower or its Affiliate relating to Borrower and its Subsidiaries or their business, other than
any such information that is available to any Agent or any Lender on a nonconfidential basis prior
to disclosure by Borrower or any of its Affiliates. 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.

     SECTION 10.13 Forum Selection and Consent to Jurisdiction. ANY LITIGATION BASED
HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT,
OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF
THE ADMINISTRATIVE AGENT, THE LENDERS OR THE BORROWER SHALL BE BROUGHT AND MAINTAINED EXCLUSIVELY
IN THE COURTS OF THE STATE OF TEXAS OR NEW YORK OR IN THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF TEXAS OR THE SOUTHERN DISTRICT OF NEW YORK; PROVIDED, HOWEVER,
THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT THE
ADMINISTRATIVE AGENT’S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH COLLATERAL OR OTHER
PROPERTY MAY BE FOUND. THE BORROWER, THE ADMINISTRATIVE AGENT, AND EACH LENDER HEREBY EXPRESSLY
AND IRREVOCABLY SUBMIT TO THE JURISDICTION OF THE COURTS OF THE STATE OF TEXAS OR NEW YORK AND OF
THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXAS OR THE SOUTHERN DISTRICT OF NEW
YORK FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET FORTH ABOVE AND IRREVOCABLY AGREE TO BE BOUND BY
ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH SUCH LITIGATION. THE BORROWER, THE ADMINISTRATIVE
AGENT, AND EACH LENDER FURTHER IRREVOCABLY CONSENT TO THE SERVICE OF PROCESS BY REGISTERED MAIL,
POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF TEXAS. THE BORROWER, THE
ADMINISTRATIVE AGENT, AND EACH LENDER HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE OR HEREAFTER MAY HAVE TO THE LAYING OF
VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY
SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT THAT THE BORROWER HAS OR
HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS
(WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION OR
OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, THE BORROWER HEREBY IRREVOCABLY WAIVES SUCH
IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.

59

 

     SECTION 10.14 Waiver of Jury Trial. THE ADMINISTRATIVE AGENT, THE LENDERS AND THE
BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL
BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH,
THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE ADMINISTRATIVE AGENT, THE LENDERS OR THE BORROWER.
THE BORROWER ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR
THIS PROVISION (AND EACH OTHER PROVISION OF EACH OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY) AND
THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE ADMINISTRATIVE AGENT AND THE LENDERS ENTERING
INTO THIS AGREEMENT AND EACH SUCH OTHER LOAN DOCUMENT.

     SECTION 10.15 USA Patriot Act Notice. Each Lender, each Issuing Bank 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, 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 USA Patriot Act.

     SECTION 10.16 Initial Borrowing and Existing Credit Agreement. Notwithstanding the
pro-rata provisions of Sections 2.1 and 4.8, on the Effective Date and for the
purposes of only the initial Borrowing, each Lender shall advance that portion of the initial
Borrowing such that after giving effect to such Loan each Lender’s Percentage of the outstanding
Loans shall be equal to such Lender’s Percentage. In furtherance of the preceding sentence, on the
Effective Date, an Existing Lender shall receive a partial repayment of its outstanding principal
from the Borrower if such repayment is necessary to ensure that such Existing Lender’s Percentage
of the outstanding Loans after the initial Borrowing shall be equal to such Existing Lender’s
Percentage as a Lender under this Agreement. On the Effective Date, Borrower shall repay each
Existing Lender which is not a Lender under this Agreement all outstanding principal, interest and
fees due to such Existing Lender under the Existing Credit Agreement. On the Effective Date,
Borrower shall pay to each Existing Lender which is a Lender under this Agreement all outstanding
interest and fees due to such Existing Lender under the Existing Credit Agreement. Any loans
outstanding under the Existing Credit Agreement on the Effective Date shall be deemed continued as
Loans under this Agreement and any letters of credit outstanding under the Existing Credit
Agreement on the Effective Date, including, without limitation, the Letters of Credit listed on
Schedule III, shall be deemed continued as Letters of Credit under this Agreement.
Interest accrued on the Loans and Commitment fees accrued under the Existing Credit Agreement
through the Effective Date hereof shall be deemed due and payable hereunder to the Existing Lenders
which are not Lenders hereunder. The Lenders hereunder shall be deemed to have purchased
participations in the outstanding Letters of Credit such that after giving effect thereto each
Lender’s participation in the outstanding Letters of Credit shall equal the Lender’s Percentage.

60

 

     SECTION 10.17 NO ORAL AGREEMENTS. THIS WRITTEN AGREEMENT AND THE OTHER LOAN DOCUMENTS
REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES WITH RESPECT TO THE SUBJECT MATTER HEREOF AND
THEREOF 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.

[SIGNATURES BEGIN ON FOLLOWING PAGE]

61

 

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

	 	 	 	 	 	 	 
	 	 	NOBLE ENERGY, INC., as the Borrower	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ Chris Tong
 

Chris Tong
	 	 
	 

	 	Title:
	 	Senior Vice President and Chief
Financial Officer	 	 

[SIGNATURE PAGE TO

2006 NOBLE ENERGY, INC.

CREDIT AGREEMENT]

S - 1

 

	 	 	 	 	 	 	 
	 	 	JPMORGAN CHASE BANK, N.A., individually as a Lender,
as the Administrative Agent, as an Issuing Bank and
as the Swingline Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ Ronald Dierker
 

Ronald Dierker
	 	 
	 

	 	Title:
	 	Senior Vice President	 	 

[SIGNATURE PAGE TO

2006 NOBLE ENERGY, INC.

CREDIT AGREEMENT]

S - 2

 

	 	 	 	 	 	 	 
	 	 	WACHOVIA BANK, NATIONAL ASSOCIATION, individually as
a Lender and as a Co-Syndication Agent	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ Allison Newman
 

Allison Newman
	 	 
	 

	 	Title:
	 	Vice President	 	 

[SIGNATURE PAGE TO

2006 NOBLE ENERGY, INC.

CREDIT AGREEMENT]

S - 3

 

	 	 	 	 	 	 	 
	 	 	THE ROYAL BANK OF
SCOTLAND PLC,
 individually as a
Lender and as a Co-Syndication Agent	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ Kevin Howard
 

Kevin Howard
	 	 
	 

	 	Title:
	 	Managing Director	 	 

[SIGNATURE PAGE TO

2006 NOBLE ENERGY, INC.

CREDIT AGREEMENT]

S - 4

 

	 	 	 	 	 	 	 
	 	 	DEUTSCHE BANK
SECURITIES INC.,
 individually as a
Co-Documentation Agent	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ Ming K. Chu
 

Ming K. Chu
	 	 
	 

	 	Title:
	 	Vice President	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ Rainer Meier
 

Rainer Meier
	 	 
	 

	 	Title:
	 	Vice President	 	 

	 	 	 	 	 	 	 
	 	 	DEUTSCHE BANK AG NEW YORK BRANCH, 
individually as a
Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ Ming K. Chu
 

Ming K. Chu
	 	 
	 

	 	Title:
	 	Vice President	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ Rainer Meier
 

Rainer Meier
	 	 
	 

	 	Title:
	 	Vice President	 	 

[SIGNATURE PAGE TO

2006 NOBLE ENERGY, INC.

CREDIT AGREEMENT]

S - 5

 

	 	 	 	 	 	 	 
	 	 	CITIBANK, N.A., individually as a Lender and as
 a
Co-Documentation Agent	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ Jim Reilly
 

Jim Reilly
	 	 
	 

	 	Title:
	 	Attorney-in-Fact	 	 

[SIGNATURE PAGE TO

2006 NOBLE ENERGY, INC.

CREDIT AGREEMENT]

S - 6

 

	 	 	 	 	 	 	 
	 	 	THE BANK OF TOKYO-MITSUBISHI UFJ, LTD., formerly
known as The Bank of Tokyo-Mitsubishi, Ltd.,
individually as a Lender and as a Co-Documentation
Agent	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ John W. McGhee
 

John W. McGhee
	 	 
	 

	 	Title:
	 	Vice President & Manager	 	 

[SIGNATURE PAGE TO

2006 NOBLE ENERGY, INC.

CREDIT AGREEMENT]

S - 7

 

	 	 	 	 	 	 	 
	 	 	BANK OF AMERICA, N.A., individually as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ Jeffrey H. Rathkamp
 

Jeffrey H. Rathkamp
	 	 
	 

	 	Title:
	 	Managing Director	 	 

[SIGNATURE PAGE TO

2006 NOBLE ENERGY, INC.

CREDIT AGREEMENT]

S - 8

 

	 	 	 	 	 	 	 
	 	 	BARCLAYS BANK PLC, individually as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ Nicholas Bell
 

Nicholas Bell
	 	 
	 

	 	Title:
	 	Director	 	 

[SIGNATURE PAGE TO

2006 NOBLE ENERGY, INC.

CREDIT AGREEMENT]

S - 9

 

	 	 	 	 	 	 	 
	 	 	BNP PARIBAS, individually as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:

Title:
	 	/S/ Brian M. Malone
 

Brian M. Malone 

Managing Director
	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/S/ Betsy Jocher	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Betsy Jocher	 	 
	 

	 	Title:
	 	Director	 	 

[SIGNATURE PAGE TO

2006 NOBLE ENERGY, INC.

CREDIT AGREEMENT]

S - 10

 

	 	 	 	 	 	 	 
	 	 	MIZUHO CORPORATE BANK, LTD., 
individually as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ Raymond Ventura
 

Raymond Ventura
	 	 
	 

	 	Title:
	 	Deputy General Manager	 	 

[SIGNATURE PAGE TO

2006 NOBLE ENERGY, INC.

CREDIT AGREEMENT]

S - 11

 

	 	 	 	 	 	 	 
	 	 	CALYON NEW YORK BRANCH, individually as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ Michael D. Willis
 

Michael D. Willis
	 	 
	 

	 	Title:
	 	Director	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ Tom Byargeon
 

Tom Byargeon
	 	 
	 

	 	Title:
	 	Managing Director	 	 

[SIGNATURE PAGE TO

2006 NOBLE ENERGY, INC.

CREDIT AGREEMENT]

S - 12

 

	 	 	 	 	 	 	 
	 	 	DNB NOR BANK ASA, individually as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ Thomas Tangen
 

Thomas Tangen
	 	 
	 

	 	Title:
	 	Vice President	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ Kevin O’Hara
 

Kevin O’Hara
	 	 
	 

	 	Title:
	 	Vice President	 	 

[SIGNATURE PAGE TO

2006 NOBLE ENERGY, INC.

CREDIT AGREEMENT]

S - 13

 

	 	 	 	 	 	 	 
	 	 	FORTIS CAPITAL CORP., individually as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ David Montgomery
 

David Montgomery
	 	 
	 

	 	Title:
	 	Senior Vice President	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ Deirdre Sanborn
 

Deirdre Sanborn
	 	 
	 

	 	Title:
	 	Senior Vice President	 	 

[SIGNATURE PAGE TO

2006 NOBLE ENERGY, INC.

CREDIT AGREEMENT]

S - 14

 

	 	 	 	 	 	 	 
	 	 	UBS LOAN FINANCE LLC, individually as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ Richard L. Tavrow
 

Richard L. Tavrow
	 	 
	 

	 	Title:
	 	Director	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/S/ Irja R. Otsa	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Irja R. Otsa	 	 
	 

	 	Title:
	 	Associate Director	 	 

[SIGNATURE PAGE TO

2006 NOBLE ENERGY, INC.

CREDIT AGREEMENT]

S - 15

 

	 	 	 	 	 	 	 
	 	 	WELLS FARGO BANK, NA, individually as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ William S. Rogers
 

William S. Rogers
	 	 
	 

	 	Title:
	 	Vice President	 	 

[SIGNATURE PAGE TO

2006 NOBLE ENERGY, INC.

CREDIT AGREEMENT]

S - 16

 

	 	 	 	 	 	 	 
	 	 	SOCIÉTÉ GÉNÉRALE, individually as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ Stephen W. Warfel
 

Stephen W. Warfel
	 	 
	 

	 	Title:
	 	Director	 	 

[SIGNATURE PAGE TO

2006 NOBLE ENERGY, INC.

CREDIT AGREEMENT]

S - 17

 

	 	 	 	 	 	 	 
	 	 	SUMITOMO MITSUI BANKING CORPORATION, 
individually as
a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ Masakazu Hasegawa
 

Masakazu Hasegawa
	 	 
	 

	 	Title:
	 	Joint General Manager	 	 

[SIGNATURE PAGE TO

2006 NOBLE ENERGY, INC.

CREDIT AGREEMENT]

S - 18

 

	 	 	 	 	 	 	 
	 	 	BAYERISCHE LANDESBANK, CAYMAN ISLANDS BRANCH,
individually as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ Edward J. Cripps
 

Edward J. Cripps
	 	 
	 

	 	Title:
	 	Vice President	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ Stephen Christenson
 

Stephen Christenson
	 	 
	 

	 	Title:
	 	First Vice President	 	 

[SIGNATURE PAGE TO

2006 NOBLE ENERGY, INC.

CREDIT AGREEMENT]

S - 19

 

	 	 	 	 	 	 	 
	 	 	BMO CAPITAL MARKETS FINANCING, INC., individually as
a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ James V. Ducote
 

James V. Ducote
	 	 
	 

	 	Title:
	 	Vice President	 	 

[SIGNATURE PAGE TO

2006 NOBLE ENERGY, INC.

CREDIT AGREEMENT]

S - 20

 

	 	 	 	 	 	 	 
	 	 	CREDIT SUISSE, CAYMAN ISLANDS BRANCH, 
individually as
a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ Vanessa Gomez
 

Vanessa Gomez
	 	 
	 

	 	Title:
	 	Vice President	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ Nupur Kumar
 

Nupur Kumar
	 	 
	 

	 	Title:
	 	Associate	 	 

[SIGNATURE PAGE TO

2006 NOBLE ENERGY, INC.

CREDIT AGREEMENT]

S - 21

 

	 	 	 	 	 	 	 
	 	 	MORGAN STANLEY BANK, individually as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ Daniel Twenge
 

Daniel Twenge
	 	 
	 

	 	Title:
	 	Authorized Signatory	 	 
	 

	 	 	 	Morgan Stanley Bank	 	 

[SIGNATURE PAGE TO

2006 NOBLE ENERGY, INC.

CREDIT AGREEMENT]

S - 22 

 

	 	 	 	 	 	 	 
	 	 	COMERICA BANK, individually as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/S/ Juli Bieser
 

 Juli Bieser
	 	 
	 

	 	Title:  Vice President
	 	 

[SIGNATURE PAGE TO

2006 NOBLE ENERGY, INC.

CREDIT AGREEMENT]

S - 23 

 

EXHIBIT 2.5

BORROWING REQUEST

JPMorgan Chase Bank, N.A., as Administrative Agent

Agency Services

1111 Fannin Street, 10th Floor

Houston, Texas 77002

	 	 	 
	Attention:

	 	Rose Salvacion
	Telephone No.:

	 	(713) 750-2501
	Facsimile No.:

	 	(713) 427-6307

JPMorgan Chase Bank, N.A., as Administrative Agent

Global Oil & Gas Group

712 Main Street, 12th Floor

Houston, Texas 77002

	 	 	 
	Attention:

	 	Peter Licalzi
	Telephone:

	 	713-216-8869
	Facsimile:

	 	713-216-4117

NOBLE ENERGY, INC.

Gentlemen and Ladies:

     This Borrowing Request is delivered to you pursuant to Section 2.5 of the Amended and
Restated Credit Agreement, dated as of November 30, 2006 (as may be amended, supplemented, restated
or otherwise modified from time to time, the “Credit Agreement”), among Noble Energy, Inc.,
a Delaware corporation (the “Borrower”), JPMorgan Chase Bank, N.A., as administrative agent
(in such capacity, together with any successor(s) thereto in such capacity, the “Administrative
Agent”), the various other agents party thereto, and certain commercial lending institutions as
are or may become Lenders thereunder. Unless otherwise defined herein or the context otherwise
requires, terms used herein have the meanings provided in the Credit Agreement.

     The Borrower hereby requests that a Loan be made in the aggregate principal amount of
$                    
on           ,            as a [Eurodollar Loan having an Interest Period of                     months]
[Base Rate Loan] [Swingline Loan].

     The Borrower hereby acknowledges that, pursuant to Section 5.2.2 of the Credit
Agreement, each of the delivery of this Borrowing Request and the acceptance by the Borrower of the
proceeds of the Loans requested hereby constitute a representation and warranty by the Borrower
that, on the date of such Loans, and before and after giving effect thereto and to the application
of the proceeds therefrom, all statements set forth in Section 5.2.1 are true and correct
in all material respects.

     The Borrower agrees that if prior to the time of the Borrowing requested hereby any matter
certified to herein by it will not be true and correct at such time as if then made, it will

Exhibit 2.5 — Page 1

 

 

immediately so notify the Administrative Agent. Except to the extent, if any, that prior to
the time of the Borrowing requested hereby the Administrative Agent shall receive written notice to
the contrary from the Borrower, each matter certified to herein shall be deemed once again to be
certified as true and correct at the date of such Borrowing as if then made.

     Please wire transfer the proceeds of the Borrowing to the accounts of the following persons at
the financial institutions indicated respectively:

	 	 	 	 	 	 	 
	Amount to be	 	Person to be Paid	 	Name, Address, etc.
	Transferred	 	Name	 	Account No.	 	of Transferee Lender
	$                     
	 	                    	 	                    	 	                                        
	 
	 	 	 	 	 	                                        
	 
	 	 	 	 	 	Attention:                        
	 
	 	 	 	 	 	 
	$                     
	 	                    	 	                    	 	                                        
	 
	 	 	 	 	 	                                        
	 
	 	 	 	 	 	Attention:                        
	 
	 	 	 	 	 	 
	Balance of such
proceeds
	 	The Borrower	 	                    	 	                                        
	 
	 	 	 	 	 	                                        
	 
	 	 	 	 	 	Attention:                        

     The Borrower has caused this Borrowing Request to be executed and delivered, and the
certification and warranties contained herein to be made, by its duly Authorized Officer this ___
day of                     , 200___.

	 	 	 	 	 	 	 
	 	 	NOBLE ENERGY, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By	 	 	 	 
	 

	 	Name:
	 	 

	 	 
	 

	 	Title:	 	 	 	 

Exhibit 2.5 — Page 2

 

 

EXHIBIT 2.6

CONTINUATION/CONVERSION NOTICE

JPMorgan Chase Bank, N.A., as Administrative Agent

Agency Services

1111 Fannin Street, 10th Floor

Houston, Texas 77002

	 	 	 
	Attention:

	 	Rose Salvacion
	Telephone No.:

	 	(713) 750-2501
	Facsimile No.:

	 	(713) 427-6307

JPMorgan Chase Bank, N.A., as Administrative Agent

Global Oil & Gas Group

712 Main Street, 12th Floor

Houston, Texas 77002

	 	 	 
	Attention:

	 	Peter Licalzi
	Telephone:

	 	713-216-8869
	Facsimile:

	 	713-216-4117

NOBLE ENERGY, INC.

Gentlemen and Ladies:

     This Continuation/Conversion Notice is delivered to you pursuant to Section 2.6 of the
Amended and Restated Credit Agreement, dated as of November 30, 2006 (as may be amended,
supplemented, restated or otherwise modified from time to time, the “Credit Agreement”),
among Noble Energy, Inc., a Delaware corporation (the “Borrower”), JPMorgan Chase Bank,
N.A., as administrative agent (in such capacity, together with any successor(s) thereto in such
capacity, the “Administrative Agent”), the other agents party thereto, and certain
commercial lending institutions as are or may become Lenders thereunder. Unless otherwise defined
herein or the context otherwise requires, terms used herein have the meanings provided in the
Credit Agreement.

     The Borrower hereby requests that on                     , 200___,

     (1) $                     of the presently outstanding principal amount of the Loans originally
made on
                    , 200___ [and $                     of the presently outstanding principal amount of
the Loans originally made on                     , 200___],

     (2) and all presently being maintained as [Base Rate Loans] [Eurodollar Loans],

     (3) be [converted into] [continued as],

     (4) [Eurodollar Loans having an Interest Period of            months] [Base Rate Loans].

Exhibit 2.6 — Page 1

 

 

The Borrower hereby:

     (a) certifies and warrants that no Default or Event of Default has occurred and is
continuing; and

     (b) agrees that if prior to the time of such continuation or conversion any matter
certified to herein by it will not be true and correct at such time as if then made, it will
immediately so notify the Administrative Agent.

Except to the extent, if any, that prior to the time of the continuation or conversion requested
hereby the Administrative Agent shall receive written notice to the contrary from the Borrower,
each matter certified to herein shall be deemed to be certified at the date of such continuation or
conversion as if then made.

     The Borrower has caused this Continuation/Conversion Notice to be executed and delivered, and
the certification and warranties contained herein to be made, by its Authorized Officer this ___
day of                     , 200___.

	 	 	 	 	 	 	 
	 	 	NOBLE ENERGY, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By	 	 	 	 
	 

	 	Name:
	 	 

	 	 
	 

	 	Title:	 	 	 	 

Exhibit 2.6 — Page 2

 

 

EXHIBIT 2.8

[FORM OF]

NOTE

			
	$                    
	 	November 30, 2006

     FOR VALUE RECEIVED, the undersigned, NOBLE ENERGY, INC., a Delaware corporation (the
“Borrower”), promises to pay to the order of                                                              (the
“Lender”) on the Maturity Date the principal sum of                                                              AND
___/100 DOLLARS ($                    ) or, if less, the aggregate unpaid principal amount of all
Obligations shown on the schedule attached hereto (and any continuation thereof, provided, however,
that the failure to make such notations shall not limit or otherwise affect the obligations of the
Borrower under this Note or the Credit Agreement (as herein defined)), in either case made by the
Lender pursuant to that certain Amended and Restated Credit Agreement, dated as of November 30,
2006 (together with all amendments and other modifications, if any, from time to time thereafter
made thereto, the “Credit Agreement”), among Borrower, the Lenders party thereto (including
the Lender), JPMorgan Chase Bank, N.A., as administrative agent (in such capacity, together with
any successor(s) thereto in such capacity, the “Administrative Agent”), and the other
agents party thereto.

     The Borrower also promises to pay interest on the unpaid principal amount hereof from time to
time outstanding from the date hereof until maturity (whether by acceleration or otherwise) and,
after maturity, until paid, at the rates per annum and on the dates specified in the Credit
Agreement.

     This Note (the “Note”) evidences Indebtedness incurred under the Credit Agreement to
which reference is made for a statement of the terms and conditions on which the Borrower is
permitted and required to make prepayments and repayments of principal of the Indebtedness
evidenced by this Note and on which such Indebtedness may be declared to be immediately due and
payable. Capitalized terms used herein and not otherwise defined herein shall have the meanings
assigned to such terms in the Credit Agreement.

     All parties hereto, whether as makers, endorsers, or otherwise, severally waive presentment
for payment, demand, protest and notice of dishonor.

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

	 	 	 	 	 	 	 
	 	 	NOBLE ENERGY, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	Name:
	 	 

	 	 
	 

	 	Title:	 	 	 	 

Exhibit 2.8 — Page 1

 

 

LOANS AND PRINCIPAL PAYMENTS

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Interest	 	 	Amount of	 	 	Unpaid	 	 	 	 	 	 	 	 
	 	 	Amount of	 	 	Period (if	 	 	Principal	 	 	Principal	 	 	 	 	 	 	Notation	 
	Date	 	Loan Made	 	 	Applicable)	 	 	Repaid	 	 	Balance	 	 	Total	 	 	Made By	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

Exhibit 2.8 — Page 2

 

 

EXHIBIT 2.9

NOTICE OF COMMITMENT INCREASE

JPMorgan Chase Bank, N.A., as Administrative Agent

Agency Services

1111 Fannin Street, 10th Floor

Houston, Texas 77002

	 	 	 
	Attention:

	 	Rose Salvacion
	Telephone No.:

	 	(713) 750-2501
	Facsimile No.:

	 	(713) 427-6307

JPMorgan Chase Bank, N.A., as Administrative Agent

Global Oil & Gas Group

712 Main Street, 12th Floor

Houston, Texas 77002

	 	 	 
	Attention:

	 	Peter Licalzi
	Telephone:

	 	713-216-8869
	Facsimile:

	 	713-216-4117

NOBLE ENERGY, INC.

Gentlemen and Ladies:

     This Notice of Commitment Increase is delivered to you pursuant to Section 2.9 of the
Amended and Restated Credit Agreement, dated as of November 30, 2006 (as may be amended,
supplemented, restated or otherwise modified from time to time, the “Credit Agreement”),
among Noble Energy, Inc., a Delaware corporation (the “Borrower”), JPMorgan Chase Bank,
N.A., as administrative agent (in such capacity, together with any successor(s) thereto in such
capacity, the “Administrative Agent”), the other agents party thereto, and certain
commercial lending institutions as are or may become Lenders thereunder. Unless otherwise defined
herein or the context otherwise requires, terms used herein have the meanings provided in the
Credit Agreement.

     Please be advised that Borrower hereby requests an increase effective                     ,
20___1 in the aggregate Commitments under the Credit Agreement from $                     to
$                    .2

      [CI Lender] has agreed [Language for existing Lender] [to
increase effective
                    , 20___ its Commitment under the Credit Agreement from
$                     to $                     and (b) that it shall continue to be a party in all respects to
the Credit Agreement and the other Loan Documents] [Language for new Lender] [effective
                    ,
20___ (a) to  become a Lender under the Credit Agreement with a Commitment of $                     and

 

			
	1	 	Such date shall be no earlier than five (5)
Business Days after receipt by the Administrative Agent of such Notice of
Commitment Increase (unless an earlier date is otherwise agreed to by the
Borrower, any applicable Lender or CI Lender, and the Administrative Agent).
	 
	2	 	After giving effect to the requested
Commitment Increase, the total amount of the Commitments shall not exceed
$3,000,000,000.

Exhibit 2.9 — Page 1

 

 

(b) that it
shall be deemed to be a party in all respects to the Credit Agreement and the other Loan
Documents.]

     The parties hereto have caused this Notice of Commitment Increase to be executed and
delivered, and the certification and warranties contained herein to be made, by its Authorized
Officer this ___ day of                     , 200___.

	 	 	 	 	 	 	 
	 	 	NOBLE ENERGY, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By	 	 	 	 
	 

	 	Name:
	 	 

	 	 
	 

	 	Title:	 	 	 	 

	 	 	 	 	 
	ACKNOWLEDGED AND AGREED:	 	 
	 
	 	 	 	 
	[Name of CI Lender]
	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	Name:

	 	 

	 	 
	Title:
	 	 	 	 
	 
	 	 	 	 
	JPMORGAN CHASE BANK, N.A., as Administrative Agent
and as an Issuing Bank	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	Name:

	 	 

	 	 
	Title:
	 	 	 	 
	 
	 	 	 	 
	                                        , as an Issuing Bank	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	Name:

	 	 

	 	 
	Title:
	 	 	 	 

Exhibit 2.9 — Page 2

 

 

EXHIBIT 5.1.4

OPINION OF COUNSEL TO THE BORROWER

[see attached]

Exhibit 5.1.4 — Page 1

 

 

November 30, 2006

The Lenders and the Agents Party to the

     Amended and Restated Credit Agreement

c/o JPMorgan Chase Bank, N.A.,

      as Administrative Agent for the Lenders

1111 Fannin Street, 10th Floor

Houston, Texas 77002

Ladies and Gentlemen:

     We have acted as special counsel to Noble Energy, Inc., a Delaware corporation (“Borrower”),
in connection with the $2,100,000,000 Amended and Restated Credit Agreement dated as of November
30, 2006 (the “Agreement”) among Borrower, JPMorgan Chase Bank, N.A., individually and as
administrative agent for the Lenders (“Agent”), certain Co-Documentation Agents, certain
Co-Syndication Agents, and Lenders named therein. This opinion letter is delivered to you pursuant
to Section 5.1.4 of the Agreement. Capitalized terms used but not otherwise defined herein
shall have the meanings given to them in the Agreement.

     In our capacity as counsel for Borrower, we have examined executed originals or copies of
executed originals of the Agreement and the other Loan Documents that have been executed and
delivered to you by Borrower today in connection with the Agreement. We have also examined and
relied upon originals or copies, certified or otherwise authenticated to our satisfaction, of such
corporate records of Borrower, certificates of officers of Borrower, certificates and letters of
public officials, and other instruments and documents as we have deemed necessary to require as a
basis for the opinions hereinafter expressed. In such examination, we have assumed the genuineness
and authenticity of all documents submitted to us as originals (other than the Loan Documents), the
conformity with genuine and authentic originals of all documents submitted to us as copies, and the
genuineness of all signatures (other than the signatures on behalf of Borrower on the Loan
Documents).

     Where facts material to the opinions hereinafter expressed were not independently established
by us, we have relied upon the representations and warranties made to you by Borrower in the Loan
Documents and upon written statements of and information furnished by officers of Borrower and its
Subsidiaries, where we deemed such reliance appropriate under the circumstances. We have
necessarily assumed the accuracy and completeness of such representations, warranties, statements
and other information.

     Based on the foregoing and on the assumptions hereinafter set forth, and subject to the
exceptions, limitations and qualifications hereinafter expressed, it is our opinion that:

Exhibit 5.4.1 – Page 1

 

 

The Lenders and the Agents Party to the

     Amended and Restated Credit Agreement

November 30, 2006

Page 2

     1. Borrower is a corporation that is validly existing and in good standing under the
laws of the State of Delaware. Borrower is duly qualified and is authorized to do business
and is in good standing as a foreign corporation in the State of Texas.

     2. Borrower has the corporate power to execute, deliver and carry out the terms and
provisions of each of the Loan Documents to which it is a party and has taken all necessary
corporate action to authorize the execution, delivery and performance by it of each of such
Loan Documents.

     3. The execution, delivery and performance by Borrower of the Agreement and each other
Loan Document executed by it do not (i) violate the certificate of incorporation or by-laws
of Borrower, (ii) violate, constitute a breach of or result in the imposition or creation of
(or the obligation to impose or create) a Lien pursuant to, any of the terms or provisions
of any indenture, loan agreement or other agreement to which Borrower is a party or by which
Borrower or its property is bound that is filed as (or incorporated by reference as) an
exhibit to Borrower’s Annual Report on Form 10-K for the fiscal year ended December 31,
2005, or as an exhibit to Borrower’s Quarterly Reports on Form 10-Q for the fiscal quarters
ended March 31, 2006, June 30, 2006, and September 30, 2006, (iii) violate any applicable
statute, rule or regulation of any governmental body of the United States of America or the
State of Texas, or (iv) to the knowledge of the undersigned, any court decree or order
binding upon Borrower.

     4. No authorization or approval or other action by, and no notice to or filing with,
any governmental authority or regulatory body pursuant to any law or any rule or order of
general application is required for the due execution, delivery or performance by Borrower
of any Loan Document to which it is a party.

     5. Neither Borrower nor any of its Subsidiaries is an “investment company” within the
meaning of the Investment Company Act of 1940, as amended.

     6. Each of the Loan Documents to which Borrower is a party has been duly executed and
delivered by Borrower. The Loan Documents constitute the legal, valid and binding
obligations of Borrower enforceable in accordance with their respective terms, except as
enforcement thereof may be limited by applicable bankruptcy, insolvency, fraudulent
conveyance, fraudulent transfer, reorganization, receivership, moratorium, or other similar
laws affecting creditors’ rights generally and equitable principles of general
applicability.

     7. To the knowledge of the undersigned, there is no pending legal action against
Borrower or any of its Subsidiaries before any court, governmental agency or arbitrator,
which purports to affect the enforceability of, or the rights and remedies of Agent and the
Lenders under, the Agreement or any other Loan Document.

Exhibit 5.4.1 – Page 2

 

 

The Lenders and the Agents Party to the

     Amended and Restated Credit Agreement

November 30, 2006

Page 3

     The opinions expressed above are based in part upon the assumptions, and are subject to the
exceptions, limitations and qualifications, set forth below:

     (a) Whenever any opinion expressed herein with respect to any matter is qualified by
the phrase “to the knowledge of the undersigned,” such phrase (A) indicates that (i) no
information has come to the attention of any attorney of this firm who has devoted
substantive attention to the transactions contemplated in the Agreement that has given any
such person actual knowledge concerning such matter different from that expressed in such
opinion; (ii) except as otherwise stated herein, we have not undertaken any independent
investigation with respect to such matter but have relied on representations made by
Borrower in the Loan Documents and on information otherwise provided to us by it; and (iii)
no inference that any such person has actual knowledge concerning such matters should be
drawn from the fact of our representation of Borrower and its Subsidiaries or our expression
of such opinion; and (B) does not encompass the actual knowledge of any attorney of this
firm who obtained such knowledge in his capacity as a director of Borrower.

     (b) Except as expressly set forth herein, we have made no independent investigation as
to the accuracy or completeness of any representation, warranty, data or other information,
written or oral, made or furnished in or in connection with the Loan Documents, or
otherwise.

     (c) We express no opinion herein with respect to the laws of any jurisdiction other
than the State of Texas and the United States of America, except insofar as the matters
covered by the foregoing opinions may involve or be governed by or construed under the
General Corporation Law of the State of Delaware. Our opinion regarding the General
Corporation Law of the State of Delaware is confined to our reading thereof without
application of judicial or administration interpretations thereof.

     (d) In rendering certain of the opinions expressed above, we have assumed that each of
the Agents and Lenders (i) are duly authorized to execute and deliver (or accept), and have
duly executed and delivered (or accepted), the Loan Documents required to be executed and
delivered (or accepted) by it and (ii) each Lender will fund the Loans to the extent
required to be funded by it under the Agreement.

     (e) We express no opinion concerning (i) any right of any Agent or any Lender or any
other person to be indemnified against (or released from the consequences of) its own
negligence, strict liability, recklessness, unlawful conduct, fraud, illegality or willful
misconduct; (ii) the enforceability of any obligations of any party other than Borrower;
(iii) the effectiveness or enforceability of provisions restricting access to courts or to
legal or equitable remedies or purporting to affect jurisdiction or venue; or (iv) the
effectiveness or enforceability of any waiver of the right to trial by jury or any rights or
benefits that cannot be waived under applicable law.

Exhibit 5.4.1 – Page 3

 

 

The Lenders and the Agents Party to the

     Amended and Restated Credit Agreement

November 30, 2006

Page 4

     (f) For purposes of this opinion, we have assumed that the Borrower is, and in
connection with each incurrence of Indebtedness under the Agreement will be, in compliance
with the covenants contained in Sections 7.2.3(a) and (b) of the Agreement.

     (g) With respect to our opinion in Paragraph 1, we have relied exclusively upon the
following certificates of public officials: (i) a certificate of the Secretary of State of
the State of Delaware dated as of November 22, 2006, (ii) a certificate of the Secretary of
State of the State of Texas dated as of November 22, 2006, and (iii) a certificate of the
Comptroller of the State of Texas dated as of November 22, 2006.

     This opinion letter is to be limited in its use to reliance by you in consummating the
Agreement. No other person or entity (other than the Lenders and the Assignee Lenders) may rely or
claim reliance on any opinion expressed herein except with our express written consent. We assume
no obligation to supplement this opinion if, after the date hereof, any applicable law changes or
we become aware of any facts that might change the opinions set forth herein.

Respectfully submitted,

Exhibit 5.4.1 – Page 4

 

 

EXHIBIT 10.10

[Form of]

LENDER ASSIGNMENT AGREEMENT

     Reference is made to that certain Amended and Restated Credit Agreement, dated as of November
30, 2006 (as may be amended, supplemented, restated or otherwise modified from time to time, the
“Credit Agreement”), among Noble Energy, Inc., a Delaware corporation (the
“Borrower”), JPMorgan Chase Bank, N.A., as administrative agent (in such capacity, together
with any successor(s) thereto in such capacity, the “Administrative Agent”), the other
agents party thereto, and certain commercial lending institutions as are or may become Lenders
thereunder. Terms defined in the Credit Agreement are used herein with the same meanings, receipt
of which is 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 Lender Assignment Agreement as if set forth herein in full.

     For an agreed consideration, the Assignor hereby irrevocably sells and assigns to the
Assignee, and the Assignee hereby irrevocably purchases and assumes from the Assignor, subject to
and in accordance with the Standard Terms and Conditions contained in Annex 1 hereto and
the terms and conditions of Section 10.10 of the Credit Agreement, as of the Effective Date
inserted by the Administrative Agent as contemplated below (a) all of the Assignor’s rights and
obligations in its capacity as a Lender under the Credit Agreement and every other Loan Document to
the extent related to the amount and percentage interest identified below of all of such
outstanding rights and obligations of the Assignor under the respective facilities identified below
(including any letters of credit, guarantees and Swingline Loans included in such facilities) and
(b) to the extent permitted to be assigned under applicable law, all claims, suits, causes of
action and any other right of the Assignor (in its capacity as a Lender) against any Person,
whether known or unknown, arising under or in connection with the Credit Agreement, any other Loan
Document, 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 (a)
above (the rights and obligations sold and assigned pursuant to clauses (a) and
(b), collectively, the “Assigned Interest”). Such sale and assignment is without
recourse to the Assignor and, except as expressly provided in this Lender Assignment Agreement,
without representation or warranty by the Assignor.

     THIS LENDER ASSIGNMENT AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAW OF THE STATE OF TEXAS.

	 	 	 	 	 
	(1) Legal Name of Assignor:
	 	 	 	 
	 

	 	 

	 	 

Exhibit 10.10 — Page 1

 

 

	 	 	 	 	 
	(2) Legal Name of Assignee:
	 	 	 	 
	 

	 	 

[and is a Lender/Lender Affiliate of
[identify Lender]]1
	 	 
	 
	 	 	 	 
	(3) Assignee’s Address for Notices:
	 	 	 	 
	 

	 	 

	 	 
	 
	 	 	 	 
	(4) Borrower:

	 	Noble Energy, Inc., a Delaware corporation	 	 
	 
	 	 	 	 
	(5) Assigned Interest:
	 	 	 	 

	 	 	 	 	 
	Aggregate Amount of	 	Principal Amount of	 	 
	Commitment/Loans for	 	Commitment/Loans	 	Percentage Assigned of
	all Lenders	 	Assigned	 	Commitment/Loans2
	$
	 	$	 	%
	$
	 	$	 	%
	$
	 	$	 	%

 

			
	1	 	Select as applicable.
	 
	2	 	Set forth, to at least 9 decimals, as a
percentage of the Commitment/Loans of all Lenders thereunder.

Exhibit 10.10 — Page 2

 

 

Effective
Date:                      ___, 200___ [TO BE INSERTED BY ADMINISTRATIVE AGENT AND WHICH SHALL
BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFORE.]

The terms set forth in this Lender Assignment Agreement are hereby agreed to:

	 	 	 	 	 	 	 
	 	 	ASSIGNOR	 	 
	 
	 	 	 	 	 	 
	 	 	[NAME OF ASSIGNOR]	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	Name:
	 	 

	 	 
	 

	 	Title:	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	ASSIGNEE	 	 
	 
	 	 	 	 	 	 
	 	 	[NAME OF ASSIGNEE]	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	Name:
	 	 

	 	 
	 

	 	Title:	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	Consented to and Accepted:	 	 
	 
	 	 	 	 	 	 
	 	 	JPMORGAN CHASE BANK,
N.A., as Administrative Agent	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	Name:
	 	 

	 	 
	 

	 	Title:	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	Consented to:	 	 
	 
	 	 	 	 	 	 
	 	 	NOBLE ENERGY, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By	 	 	 	 
	 

	 	Name:
	 	 

	 	 
	 

	 	Title:	 	 	 	 

Exhibit 10.10 — Page 3

 

 

ANNEX 1 to Lender Assignment Agreement

STANDARD TERMS AND CONDITIONS FOR

LENDER ASSIGNMENT AGREEMENT

1. Representations and Warranties.

1.1 Assignor. The Assignor (a) represents and warrants that (i) it is the legal and
beneficial owner of the Assigned Interest, (ii) the Assigned Interest is free and clear of any
lien, encumbrance or other adverse claim created by such Assignor and (iii) it has full power and
authority, and has taken all action necessary, to execute and deliver this Lender Assignment
Agreement 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, (iii) the financial
condition of Borrower or any of its Subsidiaries or Affiliates, or any other Person obligated with
respect to the Credit Agreement or any other Loan Document or (iv) the performance or observance by
Borrower or any of its Subsidiaries or Affiliates, or any other Person of any of their respective
obligations under the Credit Agreement or any other Loan Document.

1.2 Assignee. The Assignee (a) represents and warrants that (i) it has full power and
authority, and has taken all action necessary, to execute and deliver this Lender Assignment
Agreement and to consummate the transactions contemplated hereby and to become a Lender under the
Credit Agreement, (ii) it meets all requirements under the Credit Agreement with respect to the
transactions contemplated hereby (subject to receipt of such consents as may be required under the
Credit Agreement), (iii) subject to acceptance and recording hereof pursuant to Section 10.10 of the Credit Agreement, from and after the Effective Date, it shall be party to the
Credit Agreement and to the other Loan Documents and be bound by the provisions of the Credit
Agreement as a Lender thereunder and to the other Loan Documents and, to the extent of the Assigned
Interest, shall have the obligations of a Lender thereunder, and (iv) it has received a copy of the
Credit Agreement, together with copies of the most recent financial statements delivered pursuant
to Sections 7.1.1(a) and (b) thereof, as applicable, and such other documents and
information as it has deemed appropriate to make its own credit analysis and decision to enter into
this Lender Assignment Agreement and to purchase the Assigned Interest on the basis of which it has
made such analysis and decision independently and without reliance on the Administrative Agent or
any other Lender; and (b) agrees that (i) it will, independently and without reliance on the
Administrative Agent, the Assignor or any other Lender, and based on such documents and information
as it shall deem appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Loan Documents, and (ii) it will perform in accordance with their terms
all of the obligations that by the terms of the Credit Agreement and the other 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 Assigned Interest (including payments of principal, interest, fees and
other amounts) to the Assignor for amounts that have accrued to but excluding the Effective Date
and to the Assignee for amounts that have accrued from and after the Effective Date.

Exhibit 10.10 — Page 4

 

 

3. General Provisions. This Lender Assignment Agreement shall be binding upon, and inure to
the benefit of, the parties hereto and their respective successors and permitted assigns. This
Lender Assignment Agreement 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 Lender
Assignment Agreement by telecopy shall be effective as delivery of a manually executed counterpart
of this Lender Assignment Agreement.

Exhibit 10.10 — Page 5

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 
	 	 	 	 	Page	 
	ARTICLE I            DEFINITIONS AND ACCOUNTING TERMS	 	 	2	 
	SECTION 1.1
	 	Defined Terms	 	 	2	 
	SECTION 1.2
	 	Use of Defined Terms	 	 	16	 
	SECTION 1.3
	 	Cross-References	 	 	16	 
	SECTION 1.4
	 	Accounting and Financial Determinations	 	 	17	 
	ARTICLE II          THE FACILITY AND BORROWING PROCEDURES	 	 	17	 
	SECTION 2.1
	 	Facility	 	 	17	 
	SECTION 2.2
	 	Mandatory Reductions of Commitment Amount	 	 	18	 
	SECTION 2.3
	 	Voluntary Reduction of Commitment Amount	 	 	18	 
	SECTION 2.4
	 	Base Rate Loans; Eurodollar Loans; Swingline Loans	 	 	18	 
	SECTION 2.5
	 	Borrowing Procedures for Loans	 	 	18	 
	SECTION 2.6
	 	Continuation and Conversion Elections	 	 	20	 
	SECTION 2.7
	 	Funding	 	 	20	 
	SECTION 2.8
	 	Repayment of Loans; Evidence of Debt	 	 	21	 
	SECTION 2.9
	 	Increase in Commitments	 	 	21	 
	SECTION 2.10
	 	Extension of Maturity Date	 	 	23	 
	SECTION 2.11
	 	Letters of Credit	 	 	24	 
	ARTICLE III          REPAYMENTS, PREPAYMENTS, INTEREST AND FEES	 	 	28	 
	SECTION 3.1
	 	Repayments and Prepayments	 	 	28	 
	SECTION 3.2
	 	Interest Provisions	 	 	28	 
	SECTION 3.3
	 	Fees	 	 	29	 
	SECTION 3.4
	 	Payment Office	 	 	30	 
	ARTICLE IV          CERTAIN EURODOLLAR AND OTHER PROVISIONS	 	 	30	 
	SECTION 4.1
	 	Eurodollar Lending Unlawful	 	 	30	 
	SECTION 4.2
	 	Deposits Unavailable or Eurodollar Interest Rate Unascertainable	 	 	30	 
	SECTION 4.3
	 	Increased Eurodollar Borrowing Costs, etc	 	 	30	 
	SECTION 4.4
	 	Funding Losses	 	 	31	 
	SECTION 4.5
	 	Increased Capital Costs	 	 	31	 
	SECTION 4.6
	 	Taxes	 	 	32	 
	SECTION 4.7
	 	Special Fees in Respect of Reserve Requirements	 	 	33	 

-i-

 

 

TABLE OF CONTENTS

(Continued)

	 	 	 	 	 	 	 
	 	 	 	 	Page	 
	SECTION 4.8
	 	Payments, Computations, etc	 	 	34	 
	SECTION 4.9
	 	Sharing of Payments	 	 	34	 
	SECTION 4.10
	 	Replacement of Lender on Account of Increased Costs, Eurodollar Lending Unlawful, Reserve Requirements, Taxes, Certain Dissents, etc	 	 	35	 
	SECTION 4.11
	 	Maximum Interest	 	 	36	 
	ARTICLE V            CONDITIONS	 	 	37	 
	SECTION 5.1
	 	Effective Date	 	 	37	 
	SECTION 5.2
	 	All Borrowings	 	 	38	 
	ARTICLE VI           REPRESENTATIONS AND WARRANTIES	 	 	38	 
	SECTION 6.1
	 	Organization, etc	 	 	38	 
	SECTION 6.2
	 	Due Authorization, Non-Contravention, etc	 	 	39	 
	SECTION 6.3
	 	Government Approval, Regulation, etc	 	 	39	 
	SECTION 6.4
	 	Validity, etc	 	 	39	 
	SECTION 6.5
	 	Financial Information	 	 	39	 
	SECTION 6.6
	 	No Material Adverse Change	 	 	39	 
	SECTION 6.7
	 	Litigation, Labor Controversies, etc	 	 	39	 
	SECTION 6.8
	 	Subsidiaries	 	 	40	 
	SECTION 6.9
	 	Taxes	 	 	40	 
	SECTION 6.10
	 	Pension and Welfare Plans	 	 	40	 
	SECTION 6.11
	 	Environmental Warranties and Compliance	 	 	40	 
	SECTION 6.12
	 	Regulation U	 	 	40	 
	SECTION 6.13
	 	Accuracy of Information	 	 	40	 
	SECTION 6.14
	 	Use of Proceeds	 	 	41	 
	ARTICLE VII          COVENANTS	 	 	41	 
	SECTION 7.1
	 	Affirmative Covenants	 	 	41	 
	SECTION 7.2
	 	Negative Covenants	 	 	44	 
	ARTICLE VIII         EVENTS OF DEFAULT	 	 	47	 
	SECTION 8.1
	 	Listing of Events of Default	 	 	47	 
	SECTION 8.2
	 	Action if Bankruptcy	 	 	49	 
	SECTION 8.3
	 	Action if Other Event of Default	 	 	49	 

-ii-

 

 

TABLE OF CONTENTS

(Continued)

	 	 	 	 	 	 	 
	 	 	 	 	Page	 
	ARTICLE IX           THE AGENTS	 	 	50	 
	SECTION 9.1
	 	Actions	 	 	50	 
	SECTION 9.2
	 	Funding Reliance, etc	 	 	51	 
	SECTION 9.3
	 	Exculpation	 	 	51	 
	SECTION 9.4
	 	Successor	 	 	51	 
	SECTION 9.5
	 	Loans by the Agents	 	 	52	 
	SECTION 9.6
	 	Credit Decisions	 	 	52	 
	SECTION 9.7
	 	Copies, etc	 	 	52	 
	ARTICLE X            MISCELLANEOUS PROVISIONS	 	 	52	 
	SECTION 10.1
	 	Waivers, Amendments, etc	 	 	52	 
	SECTION 10.2
	 	Notices	 	 	53	 
	SECTION 10.3
	 	Payment of Costs, Expenses and Taxes	 	 	54	 
	SECTION 10.4
	 	Indemnification	 	 	55	 
	SECTION 10.5
	 	Survival	 	 	56	 
	SECTION 10.6
	 	Severability	 	 	56	 
	SECTION 10.7
	 	Headings	 	 	56	 
	SECTION 10.8
	 	Governing Law; Entire Agreement	 	 	56	 
	SECTION 10.9
	 	Successors and Assigns	 	 	56	 
	SECTION 10.10
	 	Sale and Transfer of Loans and Commitments; Participations in Loans and Commitments	 	 	56	 
	SECTION 10.11
	 	Other Transactions	 	 	58	 
	SECTION 10.12
	 	Confidentiality	 	 	58	 
	SECTION 10.13
	 	Forum Selection and Consent to Jurisdiction	 	 	59	 
	SECTION 10.14
	 	Waiver of Jury Trial	 	 	60	 
	SECTION 10.15
	 	USA Patriot Act Notice	 	 	60	 
	SECTION 10.16
	 	Initial Borrowing and Existing Credit Agreement	 	 	60	 
	SECTION 10.17
	 	NO ORAL AGREEMENTS	 	 	61	 

-iii-

 

 

TABLE OF CONTENTS

SCHEDULES AND EXHIBITS

	 	 	 	 	 
	SCHEDULE I
	 	—	 	Disclosure Schedule
	SCHEDULE II
	 	—	 	Schedule of Commitments
	SCHEDULE III
	 	—	 	Issued Letters of Credit
	SCHEDULE 6.8
	 	—	 	Subsidiaries
	SCHEDULE 7.2.2
	 	—	 	Existing Liens
	 
	EXHIBIT 2.5
	 	—	 	Form of Borrowing Request
	EXHIBIT 2.6
	 	—	 	Form of Continuation/Conversion Notice
	EXHIBIT 2.8
	 	—	 	Form of Note
	EXHIBIT 2.9
	 	—	 	Notice of Commitment Increase
	EXHIBIT 5.1.4
	 	—	 	Form of Opinion of Counsel
	EXHIBIT 10.10
	 	—	 	Form of Lender Assignment Agreement

-iv-exv10w1

 

Exhibit 10.1

SUBSCRIPTION AGREEMENT

     This Subscription Agreement (this “Agreement”) is entered into as of November 30, 2006 by and
between ReGen Biologics, Inc., a Delaware corporation (together with its successors and permitted
assigns, the “Issuer”), and the undersigned investor (together with its successors and permitted
assigns, the “Investor”). Capitalized terms used but not otherwise defined herein shall have the
meanings set forth in Section 9.1.

RECITALS

     Subject to the terms and conditions of this Agreement, the Investor desires to subscribe for
and purchase, and the Issuer desires to issue and sell to the Investor, certain shares of the
Issuer’s common stock, par value $0.01 per share (the “Common Stock”) at a purchase price of $0.37
per share for the share, accompanied by warrants to purchase the Issuer’s common stock at an
initial purchase price of $0.555 per share, in the form attached as Exhibit A hereto (the
“Warrants”). The Issuer is offering an aggregate of approximately $6.75 Million Dollars
($6,750,000) worth of shares of Common Stock and Warrants in a private placement to the Investor
and other investors s of Common Stock and on the other terms and conditions contained in this
Agreement (the “Offering”); provided, that the Issuer reserves the right to issue and sell
a lesser or greater number of shares at the discretion of its Board of Directors.

TERMS OF AGREEMENT

     In consideration of the mutual representations and warranties, covenants and agreements
contained herein, the parties hereto agree as follows:

1. SUBSCRIPTION AND ISSUANCE OF COMMON STOCK AND WARRANTS.

     1.1 Subscription and Issuance of Common Stock and Warrants. Subject to the terms and
conditions of this Agreement, the Issuer shall issue and sell to the Investor and the Investor
subscribes for and shall purchase from the Issuer the number of shares of Common Stock set forth on
the signature page hereof (the “Shares”) and that number of Warrants set forth on the signature
page hereof, for the aggregate purchase price set forth on the signature page hereof, which shall
be equal to the product of the number of Shares subscribed for by the Investor multiplied by the
per share purchase price specified in the above Recitals to this Agreement (such product, the
“Purchase Price”).

     1.2 Legends.

          (a) Any certificate or certificates representing the Shares shall bear the following legend,
in addition to any legend that may be required by any Requirements of Law:

THE SHARES REPRESENTED BY THIS CERTIFICATE MAY NOT BE SOLD,
TRANSFERRED, OR OTHERWISE DISPOSED OF BY THE HOLDER EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT FILED UNDER THE

1

 

 SECURITIES ACT OF 1933, AS AMENDED, AND IN COMPLIANCE WITH APPLICABLE
SECURITIES LAWS OF ANY STATE WITH RESPECT THERETO OR IN ACCORDANCE WITH AN OPINION OF COUNSEL IN
FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER THAT AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE
AND ALSO MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT IN COMPLIANCE WITH ANY
APPLICABLE RULES OF THE SECURITIES AND EXCHANGE COMMISSION.

          (b) The Warrants shall bear the following legend, in addition to any legend that may be
required by any Requirements of Law:

THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR THE LAWS OF ANY
STATE. THEY MAY NOT BE SOLD OR OTHERWISE TRANSFERRED UNLESS THEY ARE REGISTERED UNDER SUCH ACT AND
APPLICABLE STATE SECURITIES LAWS OR AN EXEMPTION FROM REGISTRATION IS AVAILABLE. THE SHARES
ISSUABLE UPON EXERCISE OF THESE SECURITIES MAY NOT BE SOLD, TRANSFERRED, OR OTHERWISE DISPOSED OF
BY THE HOLDER EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT FILED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, AND IN COMPLIANCE WITH APPLICABLE SECURITIES LAWS OF ANY STATE WITH RESPECT
THERETO OR IN ACCORDANCE WITH AN OPINION OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE
ISSUER THAT AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE AND ALSO MAY NOT BE SOLD, TRANSFERRED
OR OTHERWISE DISPOSED OF EXCEPT IN COMPLIANCE WITH ANY APPLICABLE RULES OF THE SECURITIES AND
EXCHANGE COMMISSION.

2. CLOSING.

     2.1 Closing. The closing of the transactions contemplated herein (the “Closing”)
shall take place on a date designated by the Issuer, which date shall be on or before December 1,
2006. The Closing shall take place at the offices of Pillsbury Winthrop Shaw Pittman LLP, counsel
for the Issuer, 1650 Tysons Boulevard, McLean, VA 22102. At the Closing, unless the Investor and
the Issuer otherwise agree, (a) the Investor shall pay the Purchase Price to the Issuer, by wire
transfer of immediately available funds to an account designated in writing by the Issuer, (b) the
Issuer shall issue to the Investor the Shares, and shall deliver or cause to be delivered promptly
after Closing to the Investor a certificate or certificates representing the Shares duly registered
in the name of the Investor, as specified on the signature pages hereto, (c) the Issuer shall issue
to the Investor the Warrants and (d) all other actions referred to in this Agreement which are
required to be taken for the Closing shall be taken and all other agreements and other documents
referred to in this Agreement which are required for the Closing shall be executed and delivered.

2

 

     2.2 Termination. This Agreement may be terminated at any time prior to the Closing:

          (a) by mutual written consent of the Issuer and the Investor;

          (b) by the Investor, upon a materially inaccurate representation or breach of any material
warranty, covenant or agreement on the part of the Issuer set forth in this Agreement, in either
case such that the conditions in Section 8.1 would be reasonably incapable of being satisfied on or
prior to the date of the Closing; or

          (c) by the Issuer, upon a materially inaccurate representation or breach of any material
warranty, covenant or agreement on the part of the Investor set forth in this Agreement, in either
case such that the conditions in Section 8.2 would be reasonably incapable of being satisfied on or
prior to the date of the Closing.

     2.3 Effect of Termination. In the event of termination of this Agreement pursuant to
Section 2.2, this Agreement shall forthwith become void, there shall be no liability on the part of
the Issuer or the Investor to each other and all rights and obligations of any party hereto shall
cease; provided, however, that nothing herein shall relieve any party from
liability for the willful breach of any of its representations and warranties, covenants or
agreements set forth in this Agreement.

3. REPRESENTATIONS AND WARRANTIES OF THE ISSUER.

     As a material inducement to the Investor entering into this Agreement, subscribing for the
Shares and the Warrants, except as set forth in the Disclosure Schedules delivered to the Investor
concurrently herewith, the Issuer represents and warrants to the Investor as follows:

     3.1 Corporate Status. The Issuer is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware. Each of the Issuer and its
Subsidiaries has full corporate power and authority to own and hold its properties and to conduct
its business as described in the Issuer’s SEC Reports. Each of the Issuer and its Subsidiaries is
duly qualified to do business and is in good standing in each jurisdiction in which the nature of
its business requires qualification or good standing, except for any failure to be so qualified or
be in good standing that would not have a Material Adverse Effect.

     3.2 Corporate Power and Authority. The Issuer has the corporate power and authority
to execute and deliver this Agreement and to perform its obligations hereunder and to consummate
the transactions contemplated hereby. At or prior to the Closing, the Issuer will have taken all
necessary corporate action to authorize the execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated hereby. No further approval or authorization
of any stockholder or the Board of Directors of the Issuer is required for the issuance and sale of
the Shares and Warrants or, except as provided in Section 6.2, the filing of the Registration
Statement.

     3.3 Enforceability. This Agreement has been duly executed and delivered by the Issuer
and (assuming it has been duly authorized, executed and delivered by the Investor) constitutes a
legal, valid and binding obligation of the Issuer, enforceable against the Issuer in

3

 

accordance
with its terms, except (a) as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’
rights generally, and (b) the indemnity provisions of Section 7 of this Agreement, which may not be
enforceable based upon public policy considerations, and general equitable principles, regardless
of whether such enforceability is considered in a proceeding at law or in equity.

     3.4 No Violation. The execution and delivery by the Issuer of this Agreement, the
consummation of the transactions contemplated hereby, and the compliance by the Issuer with the
terms and provisions hereof (including, without limitation, the Issuer’s issuance to the Investor
of the Shares and Warrants as contemplated by and in accordance with this Agreement), will not
result in a default under (or give any other party the right, with the giving of notice or the
passage of time (or both), to declare a default or accelerate any obligation under) or violate the
Certificate of Incorporation or By-Laws of the Issuer or any material Contract to which the Issuer
is a party (except to the extent such a default, acceleration, or violation would not, in the case
of a Contract, have a Material Adverse Effect on the Issuer), or materially violate any Requirement
of Law applicable to the Issuer, or result in the creation or imposition of any material Lien upon
any of the capital stock, properties or assets of the Issuer or any of its Subsidiaries (except
where such violations of any Requirement of Law or creations or impositions of any Liens would not
have a Material Adverse Effect on the Issuer). Neither the Issuer nor any of its Subsidiaries is
(a) in default under or in violation of any material Contract to which it is a party or by which it
or any of its properties is bound or (b) to its knowledge, in violation of any order of any
Governmental Authority, which, in the case of clauses (a) and (b), could reasonably be expected to
have a Material Adverse Effect.

     3.5 Consents/Approvals. Except for the filing of a registration statement in
accordance with Article 6 hereof and filings with the SEC and the securities commissions of the
states in which the Shares or Warrants are to be issued, no consents, filings, authorizations or
other actions of any Governmental Authority are required to be obtained or made by the Issuer for
the Issuer’s execution, delivery and performance of this Agreement which have not already been
obtained or made. No consent, approval, waiver or other action by any Person under any Contract to
which the Issuer is a party or by which the Issuer or any of its properties or assets are bound is
required or necessary for the execution, delivery or performance by the Issuer of this Agreement
and the consummation of the transactions contemplated hereby, except where the failure to obtain
such consents would not have a Material Adverse Effect on the Issuer.

     3.6 Valid Issuance. Upon payment of the Purchase Price by the Investor and delivery
to the Investor of the certificates for the Shares and the Warrants, such Shares, Warrants and the
shares of Common Stock issuable upon exercise of the Warrants (the “Warrant Shares”) (upon payment
of the exercise price for such Warrant Shares) will be validly issued, fully paid and
non-assessable and will be free and clear of all Liens imposed by the Issuer and will not be
subject to any preemptive rights or other similar rights of stockholders of the Issuer imposed by
law.

4

 

     3.7 SEC Filings and Other Filings. Except as set forth on Schedule 3.7, the Issuer
has timely made all filings required to be made by it under the Exchange Act since December 31,
2005. The Issuer has delivered or made accessible to the Investor true, accurate and complete
copies of (a) the Issuer’s Annual Report on Form 10-K for the fiscal year ended December 31, 2005,
(b) the Issuer’s Quarterly Report on Form 10-Q for the fiscal quarter ended September 30,
2006, and (c) the Issuer’s definitive proxy statement dated April 18, 2006 relating to its
2006 Annual Meeting of Stockholders (as such documents have, since the time of their filing, been
amended or supplemented, and together with all reports, documents and information filed or after
the date first written above through the date of Closing with the SEC, collectively the “SEC
Reports”). The SEC Reports, when filed (unless amended and superseded by a later Issuer filing
prior to the date hereof, then on the date of such later filing), complied in all material respects
with all applicable requirements of the Exchange Act and the Securities Act, if and to the extent
applicable, and the rules and regulations of the SEC thereunder applicable to the SEC Reports.

     3.8 Commissions. Except for those fees set forth on Schedule 3.8, the Issuer has not
incurred any other obligation for any finder’s or broker’s or agent’s fees or commissions in
connection with the transactions contemplated hereby.

     3.9 Capitalization. As of September 30, 2006, the authorized capital stock of the
Issuer consists of 165,000,000 shares of Common Stock and 60,000,000 shares of Preferred Stock.
Except as set forth on Schedule 3.9, all issued and outstanding shares of capital stock of the
Issuer have been, and as of the Closing Date will be, duly authorized and validly issued and are
fully paid and non-assessable, have been issued in compliance with all applicable state and federal
securities laws in all material respects and were not issued in violation of, or subject to, any
preemptive, subscription or other similar rights of any stockholder of the Issuer imposed by law.
As of September 30, 2006, the Issuer has issued and outstanding 69,832,807 shares of Common Stock
and 24,306,662 shares of Preferred Stock, of which 13,260,025 shares have been designated as Series
A Convertible Preferred Stock and of which 11,046,637 shares have been designated as Series C
Convertible Preferred Stock. Except for outstanding options to purchase 15,588,317 shares of
Common Stock, outstanding warrants to purchase 6,453,897 shares of Common Stock, the Company’s
agreement to sell to certain investors approximately One Million Dollars ($1,000,000) worth of
shares of Common Stock, warrants to purchase Common Stock and options to purchase Common Stock on
December 1, 2006 as part of the Offering, and the right to convert the outstanding shares of
Preferred Stock into shares of Common Stock, as of September 30, 2006, there were no outstanding
options, warrants, rights (including conversion or preemptive rights and rights of first refusal
and similar rights) or agreements, orally or in writing, for the purchase or acquisition from the
Issuer of any shares of capital stock, and, except as set forth on Schedule 3.9, the Issuer is not
a party to or subject to any agreement or understanding and, to the Issuer’s knowledge, there is no
agreement or understanding between any Persons, which affects or relates to the voting or giving of
written consents with respect to any security or by a director of the Issuer. The Issuer owns,
directly or indirectly, all of the capital stock of its Subsidiaries, free and clear of any Liens
or equitable interests other than as reflected in the SEC Reports. Except as set forth in the SEC
Reports, the Issuer has no obligation, contingent or otherwise, to redeem or repurchase any equity
security or any security that is a combination of debt and equity.

5

 

     3.10 Material Changes. Except as set forth in the SEC Reports or as otherwise
contemplated herein, since September 30, 2006, there has been no Material Adverse Effect in respect
of the Issuer and its Subsidiaries taken as a whole. Except as set forth in the SEC Reports, since
September 30, 2006, there has not been: (i) any direct or indirect redemption, purchase or other
acquisition by the Issuer of any shares of the Common Stock; (ii) any
declaration, setting aside or payment of any dividend or other distribution by the Issuer with
respect to the Common Stock; (iii) any borrowings incurred or any material liabilities (absolute,
accrued or contingent) assumed, other than current liabilities incurred in the ordinary course of
business, liabilities under Contracts entered into in the ordinary course of business, or
liabilities not required to be reflected on the Issuer’s financial statements pursuant to GAAP or
required to disclosed in the SEC Reports; (iv) any Lien or adverse claim on any of the Issuer’s
material properties or assets, except for Liens for taxes not yet due and payable or otherwise in
the ordinary course of business; (v) any sale, assignment or transfer of any of the Issuer’s
material assets, tangible or intangible, except in the ordinary course of business; (vi) any
extraordinary losses or waiver of any rights of material value, other than in the ordinary course
of business; (vii) any material capital expenditures or commitments therefor other than in the
ordinary course of business; (viii) any other material transaction other than in the ordinary
course of business; (ix) any material change in the nature or operations of the business of the
Issuer and its Subsidiaries; (x) any default in the payment of principal or interest in any
material amount, or violation of any material covenant, with respect to any outstanding debt
obligations that are material to the Issuer and its Subsidiaries as a whole; (xi) any material
changes to the Issuer’s critical accounting policies or material deviations from historical
accounting and other practices in connection with the maintenance of the Issuer’s books and
records; or (xii) any agreement or commitment to do any of the foregoing.

     3.11 Litigation. Except as set forth in the SEC Reports, there is no action, suit,
proceeding or investigation pending or, to the Issuer’s knowledge, currently threatened against the
Issuer or any of its Subsidiaries that questions the validity of this Agreement or the right of the
Issuer to enter into it, or to consummate the transactions contemplated hereby, or that could
reasonably be expected to result, either individually or in the aggregate, in a Material Adverse
Effect on the Issuer or any material change in the current equity ownership of the Issuer. The
foregoing includes, without limitation, actions pending or, to the Issuer’s knowledge, threatened
involving the prior employment of any of the Issuer’s employees or their use in connection with the
Issuer’s business of any information or techniques allegedly proprietary to any of their former
employers. Neither the Issuer nor any of its Subsidiaries is a party to or subject to the
provisions of any order, writ, injunction, judgment or decree of any court or Governmental
Authority. There is no action, suit, proceeding or investigation by the Issuer or any of its
Subsidiaries currently pending or which the Issuer or any of its Subsidiaries currently intends to
initiate, which could reasonably be expected to have a Material Adverse Effect.

     3.12 Rights of Registration, Voting Rights, and Anti-Dilution. Except as contemplated
in this Agreement and as set forth on Schedule 3.12, the Issuer has not granted or agreed to grant
any registration rights, including piggyback rights, to any Person and, to the Issuer’s knowledge,
no stockholder of the Issuer has entered into any agreements with respect to the voting of capital

6

 

shares of the Issuer. Except as set forth in Schedule 3.12, the issuance of the Shares and Warrants
does not constitute an anti-dilution event for any existing security holders of the Issuer,
pursuant to which such security holders would be entitled to additional securities or a reduction
in the applicable conversion price or exercise price of any securities.

     3.13 Offerings. Subject in part to the truth and accuracy of Investor’s
representations and warranties set forth in this Agreement, the offer, sale and issuance of the
Shares, Warrants
and Warrant Shares (together, the “Securities”) as contemplated by this Agreement are exempt
from the registration requirements of the Securities Act and any applicable state securities laws,
and neither the Issuer nor any authorized agent acting on its behalf will take any action hereafter
that would cause the loss of such exemption.

     3.14 Licenses and Permits. To the Issuer’s knowledge and except as disclosed in the
SEC Reports and on Schedule 3.14, each of the Issuer and its Subsidiaries has all Permits under
applicable Requirements of Law from all applicable Governmental Authorities that are necessary to
operate its businesses as presently conducted and all such Permits are in full force and effect,
except where the failure to have any such Permits in full force and effect would not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect. To the Issuer’s
knowledge, neither the Issuer nor any of its Subsidiaries is in default under, or in violation of
or noncompliance with, any of such Permits, except for any such default, violation, or
noncompliance which would not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect. To the Issuer’s knowledge, other than as disclosed in the SEC Reports,
there is no proposed change in any Requirements of Law which would require the Issuer and its
Subsidiaries to obtain any Permits in order to conduct its business as presently conducted that the
Issuer and its Subsidiaries do not currently possess and the lack of which could reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect.

     3.15 Patents and Trademarks. To the Issuer’s knowledge, the Issuer and each of its
Subsidiaries has, or has rights to use, all patents, patent applications, trademarks, trademark
applications, service marks, trade names, copyrights, licenses and know-how (including trade
secrets or other unpatented and/or unpatentable proprietary or confidential information, systems or
procedures) (collectively, the “Intellectual Property Rights”) that are necessary for use in
connection with its business as presently conducted, except where the failure to have such
Intellectual Property Rights would not reasonably be expected to have a Material Adverse Effect.
To the Issuer’s knowledge, there is no existing infringement by another person or entity of any of
the Intellectual Property Rights that are necessary for use in connection with the Issuer’s
business as presently conducted. To the Issuer’s knowledge, the Issuer is not infringing on any
intellectual property rights of any other person, nor is there any claim of infringement made or
threatened by a third party against or involving the Issuer.

7

 

     3.16 Insurance. The Issuer maintains and will continue to maintain insurance with
such insurers, and insuring against such losses, in such amounts, and subject to such deductibles
and exclusions as are customary in the Issuer’s industry and otherwise reasonably prudent, all of
which insurance is in full force and effect.

     3.17 Material Contracts. All material Contracts to which the Issuer or any Subsidiary
is a party and which are required to have been filed by the Issuer on Exhibit 10 to the SEC Reports
have been filed by the Issuer with the SEC pursuant to the requirements of the Exchange Act.
Except as disclosed in the SEC Reports, each such material Contract is in full force and effect,
except as otherwise required pursuant to its respective terms, and is binding on the Issuer or its
Subsidiaries, as the case may be, in each case, in accordance with its respective terms, and
neither the Issuer or any of its Subsidiaries nor, to the Issuer’s knowledge, any other party
thereto
is in breach of, or in default under, any such material Contract, which breach or default
would reasonably be expected to have a Material Adverse Effect. Except as set forth in the SEC
Reports, there exists no actual or, to the knowledge of the Issuer, threatened termination,
cancellation or limitation of, or any material adverse modification or change in, the business
relationship of the Issuer or any of its Subsidiaries, or the business of the Issuer or any of its
Subsidiaries, with any customer or supplier or any group of customers or suppliers whose purchases
or inventories provided to the business of the Issuer or any of its Subsidiaries would,
individually or in the aggregate, have a Material Adverse Effect.

     3.18 Taxes. The Issuer has filed all material federal, state and foreign income and
franchise tax returns and has paid or accrued all taxes shown as due thereon, and the Issuer has no
knowledge of a tax deficiency which has been or might be asserted or threatened against it which is
reasonably likely to have a Material Adverse Effect.

4. REPRESENTATIONS AND WARRANTIES OF THE INVESTOR.

     As a material inducement to the Issuer entering into this Agreement and issuing the Shares and
Warrants, the Investor represents, warrants, and covenants to the Issuer as follows:

     4.1 Power and Authority. The Investor, if other than a natural person, is an entity
duly organized, validly existing and in good standing under the laws of the jurisdiction of its
incorporation or formation. The Investor has the corporate, partnership or other power (or
capacity) and authority under applicable law to execute and deliver this Agreement and consummate
the transactions contemplated hereby, and has all necessary authority to execute, deliver and
perform its obligations under this Agreement and to consummate the transactions contemplated
hereby. The Investor has taken all necessary action to authorize the execution, delivery and
performance of this Agreement and the transactions contemplated hereby.

     4.2 No Violation. The execution and delivery by the Investor of this Agreement, the
consummation of the transactions contemplated hereby, and the compliance by the Investor with the
terms and provisions hereof, will not result in a default under (or give any other party the right,
with the giving of notice or the passage of time (or both), to declare a default or accelerate any
obligation under) or violate any charter or similar documents of the Investor, if other than a
natural person, or any Contract to which the Investor is a party or by which it or its properties
or

8

 

assets are bound, or violate any Requirement of Law applicable to the Investor, other than such
violations or defaults which, individually and in the aggregate, do not and will not have a
Material Adverse Effect on the Investor. The Investor will comply with any Requirement of Law
applicable to it in connection with the Offering and any resale by the Investor of any of the
Securities.

     4.3 Consents/Approvals. No consents, filings, authorizations or actions of any
Governmental Authority are required for the Investor’s execution, delivery and performance of this
Agreement. No consent, approval, waiver or other actions by any Person under any Contract to which
the Investor is a party or by which the Investor or any of its properties or assets are bound is
required or necessary for the execution, delivery and performance by the Investor of this Agreement
and the consummation of the transactions contemplated hereby.

     4.4 Enforceability. This Agreement has been duly executed and delivered by the
Investor and (assuming it has been duly authorized, executed and delivered by the Issuer)
constitutes a legal, valid and binding obligation of the Investor, enforceable against the Investor
in accordance with its terms, except (a) as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditor’s
rights generally, and (b) the indemnity provisions of Section 7 of this Agreement, which may not be
enforceable based upon public policy considerations, and general equitable principles, regardless
of whether enforceability is considered in a proceeding at law or in equity.

     4.5 Investment Intent. The Investor is acquiring the Shares and Warrants hereunder
for its own account and with no present intention of distributing or selling any of the Securities
and further agrees not to transfer such Securities in violation of the Securities Act or any
applicable state securities law, and no one other than the Investor has any beneficial interest in
the Shares (except to the extent that the Investor may have delegated voting authority to its
investment advisor), Warrants or Warrant Shares. The Investor agrees that it will not sell or
otherwise dispose of any of the Securities unless such sale or other disposition has been
registered under the Securities Act or, in the opinion of counsel acceptable to the Issuer, is
exempt from registration under the Securities Act and has been registered or qualified or, in the
opinion of such counsel acceptable to the Issuer, is exempt from registration or qualification
under applicable state securities laws. The Investor understands that the offer and sale by the
Issuer of the Shares and Warrants being acquired by the Investor hereunder has not been registered
under the Securities Act by reason of their contemplated issuance in transactions exempt from the
registration and prospectus delivery requirements of the Securities Act pursuant to Section 4(2)
thereof, and that the reliance of the Issuer on such exemption from registration is predicated in
part on these representations and warranties of the Investor. The Investor acknowledges that
pursuant to Section 1.2 of this Agreement a restrictive legend consistent with the foregoing has
been or will be placed on the certificates for the Securities.

9

 

     4.6 Accredited Investor. The Investor is an “accredited investor” as such term is
defined in Rule 501(a) of Regulation D under the Securities Act, and has such knowledge and
experience in financial and business matters that it is capable of evaluating the merits and risks
of the investment to be made by it hereunder.

     4.7 Adequate Information. The Investor has received from the Issuer, and has
reviewed, such information which the Investor considers necessary or appropriate to evaluate the
risks and merits of an investment in the Shares and Warrants. The Investor also acknowledges that
the additional risk factors set forth on Exhibit B and contained in the SEC Reports are
specifically incorporated herein by reference and form an integral part of this Agreement.

     4.8 Opportunity to Question. The Investor has had the opportunity to question, and
has questioned, to the extent deemed necessary or appropriate, representatives of the Issuer so as
to receive answers and verify information obtained in the Investor’s examination of the Issuer,
including the information that the Investor has received and reviewed as referenced in Section 4.7
hereof in relation to its investment in the Shares and Warrants.

     4.9 No Other Representations. No oral or written material representations have been
made to the Investor in connection with the Investor’s acquisition of the Shares and Warrants which
were in any way inconsistent with the information reviewed by the Investor. The Investor
acknowledges that in deciding whether to enter into this Agreement and to purchase the Shares and
Warrants hereunder, it has not relied on any representations or warranties of any type or
description made by the Issuer or any of its representatives (including Medwork) with regard to the
Issuer, any of its Subsidiaries, any of their respective businesses or properties, or the prospects
of the investment contemplated herein, other than the representations and warranties set forth in
Section 3 hereof.

     4.10 Knowledge and Experience. The Investor has such knowledge and experience in
financial, tax and business matters, including substantial experience in evaluating and investing
in common stock and other securities (including the common stock and other securities of
speculative companies), so as to enable the Investor to utilize the information referred to in
Section 4.7 hereof and any other information made available by the Issuer to the Investor in order
to evaluate the merits and risks of an investment in the Shares and Warrants and to make an
informed investment decision with respect thereto.

     4.11 Independent Decision. The Investor is not relying on the Issuer or on any legal
or other opinion in the materials reviewed by the Investor with respect to the financial or tax
considerations of the Investor relating to its investment in the Shares and Warrants. The Investor
has relied solely on the representations and warranties, covenants and agreements of the Issuer in
this Agreement (including the exhibits and schedules hereto) and on its examination and independent
investigation in making its decision to acquire the Shares and Warrants.

     4.12 Commissions. The Investor has not incurred any obligation for any finder’s or
broker’s or agent’s fees or commissions in connection with the transactions contemplated hereby.

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5. COVENANTS.

     5.1 Public Announcements. The Investor agrees not to make any public announcement or
issue any press release or otherwise publicly disseminate any information about the subject matter
of this Agreement. Except as provided herein, the Issuer shall have the right to make such public
announcements and shall control, in its sole and absolute discretion, the timing, form and content
of all press releases or other public communications of any sort relating to the subject matter of
this Agreement, and the method of their release, or publication thereof. The Issuer shall file
within four (4) business days after the Closing Date a Current Report on Form 8-K with the SEC in
respect of the transactions contemplated by this Agreement. The Issuer may issue an initial press
release relating to the transactions contemplated by this Agreement, but shall not identify any
Investor in such press release without the consent of such Investor, except as may be required by
any Requirement of Law or rule of any exchange on which the Issuer’s securities are listed.

     5.2 Further Assurances. Each party shall execute and deliver such additional
instruments and other documents and shall take such further actions as may be reasonably necessary
or appropriate to effectuate, carry out and comply with all of the terms of this
Agreement and the transactions contemplated hereby. Each of the Investor and the Issuer shall
make on a prompt and timely basis all governmental or regulatory notifications and filings required
to be made by it with or to any Governmental Authority in connection with the consummation of the
transactions contemplated hereby. The Issuer and the Investor each agree to cooperate with the
other in the preparation and filing of all forms, notifications, reports and information, if any,
required or reasonably deemed advisable pursuant to any Requirement of Law in connection with the
transactions contemplated by this Agreement and to use their respective commercially reasonable
efforts to agree jointly on a method to overcome any objections by any Governmental Authority to
any such transactions. Except as may be specifically required hereunder, neither of the parties
hereto nor their respective Affiliates shall be required to agree to take any action that in the
reasonable opinion of such party would result in or produce a Material Adverse Effect on such
party.

     5.3 Notification of Certain Matters. Prior to the Closing, each party hereto shall
give prompt notice to the other party of the occurrence, or non-occurrence, of any event which
would be likely to cause any representation and warranty herein to be untrue or inaccurate, or any
covenant, condition or agreement herein not to be complied with or satisfied.

     5.4 Confidential Information; Standstill.

          (a) The Investor agrees that no portion of the Confidential Information (as defined below)
shall be disclosed to third parties, except as may be required by law, without the prior express
written consent of the Issuer; provided, that the Investor may share such information with
such of its officers and professional advisors as may need to know such information to assist the
Investor in its evaluation thereof on the condition that such parties agree to be bound by the
terms hereof. “Confidential Information” means the existence and terms of

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this Agreement, the
transactions contemplated hereby, and the disclosures and other information contained herein,
excluding any disclosures or other information that is publicly available. The Investor further
agrees that it will not disclose any information regarding or trade the Common Stock acquired
through this Offering until the Issuer has publicly announced the completion of the Offering.

          (b) For a period of two (2) years from the Closing Date, the Investor will not, without the
prior written consent of the Issuer (i) propose to enter into any acquisition of all or
substantially all of the assets or stock of the Issuer or a merger or other business combination
transaction involving the Issuer, (ii) seek to control the management, Board of Directors or
policies of the Issuer, or (iii) form, join or in any way participate in a “group” (within the
meaning of Section 13(d)(3) of the Exchange Act) with respect to any securities of the Issuer in
connection with any of the foregoing.

6. REGISTRATION RIGHTS.

     The Investor shall have the following registration rights with respect to the Registrable
Securities owned by it:

     6.1 Transfer of Registration Rights. The Investor may assign the registration rights
with respect to the Securities to any party or parties to which it may from time to time transfer
all of the Shares or Warrants in accordance with Section 4.5 hereof; provided, that the
transferee agrees in writing with the Issuer to be bound by the applicable provisions of this
Agreement regarding such registration rights and indemnification relating thereto. Upon assignment
of any registration rights pursuant to this Section 6.1, the Investor shall deliver to the Issuer a
notice of such assignment which includes the identity and address of any assignee and such other
information reasonably requested by the Issuer in connection with effecting any such registration
(collectively, the Investor and each such subsequent holder is referred to as a “Holder”).

     6.2 Required Registration. The Issuer agrees to register the resale of all of the
Registrable Securities by filing a Registration Statement on Form S-1 or on any other form for
which the Issuer then qualifies and is available (the “Registration Statement”) with the SEC
between March 31, 2007 and April 30, 2007 or registering such shares on any Registration Statement
filed by the Issuer prior to that time. The Issuer shall subsequently use commercially reasonable
efforts to cause the SEC to declare the Registration Statement effective as soon as possible. The
Issuer shall thereafter maintain the effectiveness of the Registration Statement until the earlier
of (a) the date on which all the Registrable Securities have been sold pursuant to the Registration
Statement or Rule 144 promulgated under the Securities Act (“Rule 144”), (b) such time as the
Issuer reasonably determines, based on an opinion of counsel, that all of the Holders will be
eligible to sell under Rule 144 all of the Securities then owned by the Holders within the volume
limitations imposed by paragraph (e) of Rule 144 in the three month period immediately following
the termination of the effectiveness of the Registration Statement, and (c) the first anniversary
of the date the Registration Statement was declared effective by the SEC. The Registration
Statement filed pursuant to this Section 6.2 may include other securities of the Issuer that are
held by Persons who, by virtue of agreements with the Issuer, are entitled to similar registration
rights.

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     6.3 Registration Procedures.

          (a) In case of the Registration Statement effected by the Issuer subject to this Section 6,
the Issuer shall keep the Investor, on behalf of Holder, advised in writing as to the initiation of
such registration, and as to the completion thereof. In addition, subject to Section 6.2 above,
the Issuer shall, to the extent applicable to the Registration Statement:

               (i) prepare and file with the SEC such amendments and supplements to the Registration
Statement as may be necessary to keep such registration continuously effective and free from any
material misstatement or omission necessary to make the statements therein, in light of the
circumstances, not misleading, and comply with provisions of the Securities Act with respect to the
disposition of all securities covered thereby during the period referred to in Section 6.2;

               (ii) update, correct, amend and supplement the Registration Statement as necessary;

               (iii) notify the Holder promptly when the Registration Statement is declared effective by the
SEC, and furnish such number of prospectuses, including preliminary prospectuses, and other
documents incident thereto as Holder may reasonably request from time to time;

               (iv) use its commercially reasonable efforts to register or qualify such Registrable
Securities under such other securities or blue sky laws of such jurisdictions of the United States
where an exemption is not available and as Holder may reasonably request to enable it to consummate
the disposition in such jurisdiction of the Registrable Securities (provided that the Issuer will
not be required to (A) qualify generally to do business in any jurisdiction where it would not
otherwise be required to qualify but for this provision, or (B) consent to general service of
process in any such jurisdiction, or (C) subject itself to taxation in any jurisdiction where it is
not already subject to taxation);

               (v) notify Holder at any time when a prospectus relating to the 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 the Registration Statement contains an untrue statement of a
material fact or omits any fact necessary to make the statements therein not misleading and,
subject to Section 6.6, the Issuer will prepare a supplement or amendment to such prospectus, so
that, as thereafter delivered to purchasers of such shares, such prospectus will not contain any
untrue statements of a material fact or omit to state any fact necessary to make the statements
therein, in light of the circumstances under which they were made, not misleading;

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               (vi) cause all such Registrable Securities to be listed on each securities exchange on which
similar securities issued by the Issuer are then listed and obtain all necessary approvals for
trading thereon;

               (vii) provide a transfer agent and registrar for all such Registrable Securities not later
than the effective date of the Registration Statement;

               (viii) upon the sale of any Registrable Securities pursuant to the Registration Statement,
direct the transfer agent to remove all restrictive legends from all certificates or other
instruments evidencing the Registrable Securities;

               (ix) With a view to making available to the Holder the benefits of certain rules and
regulations of the SEC that at any time permit the sale of the Registrable Securities to the public
without registration, so long as any Registrable Securities are outstanding, the Issuer shall use
its commercially reasonable efforts for a period of two years following the date of Closing:

                    (1) to make and keep public information available, as those terms are understood and defined
in Rule 144(c) under the Securities Act;

                    (2) to file with the SEC in a timely manner all reports and other documents required of the
Issuer under the Exchange Act; and

                    (3) to furnish to the Holder upon any reasonable request a written statement by the Issuer as
to its compliance with the public information requirements of Rule 144(c) under the Securities Act;
and

               (x) To advise the Holder promptly after it has received notice or obtained knowledge of the
existence of any stop order by the SEC delaying or suspending the effectiveness of the Registration
Statement or of the initiation or threat of any proceeding for that purpose, and to make every
commercially reasonable effort to obtain the withdrawal of any order suspending the effectiveness
of the Registration Statement at the earliest possible time.

          (b) Notwithstanding anything stated or implied to the contrary in Section 6.3(a) above, the
Issuer shall not be required to consent to any underwritten offering of the Registrable Securities
or to any specific underwriter participating in any underwritten public offering of the Registrable
Securities.

          (c) Each Holder agrees that upon receipt of any notice from the Issuer of the happening of any
event of the kind described in Section 6.3(a)(v), and subject to Section 6.5, such Holder will
forthwith discontinue such Holder’s disposition of Registrable Securities pursuant to the
registration statement relating to such Registrable Securities until such Holder’s receipt of the
copies of the supplemented or amended prospectus contemplated by Section 6.3(a)(v) and, if so
directed by the Issuer, will deliver to the Issuer at the Issuer’s expense all copies, other than
permanent file copies, then in such Holder’s possession, of the prospectus relating to such
Registrable Securities current at the time of receipt of such notice.

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          (d) Except as required by law, all expenses incurred by the Issuer in complying with this
Section 6, including but not limited to, all registration, qualification and filing fees, printing
expenses, fees and disbursements of counsel and accountants for the Issuer, blue sky fees and
expenses (including fees and disbursements of counsel related to all blue sky matters) incurred in
connection with any registration, qualification or compliance pursuant to this Section 6 shall be
borne by the Issuer. All underwriting discounts and selling commissions applicable to a sale
incurred in connection with any registration of Registrable Securities and the legal fees and other
expenses of a Holder shall be borne by such Holder.

     6.4 Further Information. If Registrable Securities owned by a Holder are included in
any registration, such Holder shall furnish the Issuer such information regarding itself as the
Issuer may reasonably request and as shall be required in connection with any registration (or
amendment or supplement thereto), referred to in this Agreement, and Holder shall indemnify the
Issuer with respect thereto in accordance with Section 7 hereof. The Investor hereby represents
and warrants to the Issuer that it has accurately and completely provided the requested information
and answered the questions numbered (a) through (d) on the signature pages of this Agreement, and
the Investor agrees and acknowledges that the Issuer may rely on such information as being true and
correct for purposes of preparing and filing the Registration Statement at the time of filing
thereof and at the time it is declared effective, unless the Investor has notified the Issuer in
writing to the contrary prior to such time.

     6.5 Right of Suspension.

          (a) Notwithstanding any other provision of this Agreement or any related agreement to the
contrary, the Issuer shall have the right, at any time, to suspend the effectiveness of the
Registration Statement and offers and sales of the Registrable Securities pursuant thereto
whenever, in the good faith judgment of the Issuer, (i) continuing such effectiveness or permitting
such offers and sales could reasonably be expected to have an adverse effect upon the Issuer’s
ability to raise additional funds pursuant to one or more private placements of shares of the
Issuer or any debt securities of the Issuer, a proposed sale of all or substantially all of the
assets of the Issuer or a merger, acquisition, reorganization, recapitalization or similar current
transaction materially affecting the capital, structure, or equity ownership of the Issuer, (ii)
the Registration Statement must be suspended in order to register additional shares of Common
Stock, (iii) there exists a material development or a potential material development with respect
to or involving the Issuer that the Issuer would be obligated to disclose in the prospectus used in
connection with the Registration Statement, which disclosure, in the good faith judgment of the
Issuer, after considering the advice of counsel, would be premature or otherwise inadvisable at
such time, or (iv) the Registration Statement or related prospectus or any document incorporated or
deemed to be incorporated therein by reference contains an untrue statement of a material fact or
omits to state a material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances, not

15

 

misleading, including without limitation that period
annually during which any Registration Statement would require suspension pending the Issuer’s new
fiscal year financial statements (each, a “Suspension Event”). In the event that the Issuer shall
determine to so suspend the effectiveness of the Registration Statement and offers and sales of the
Registrable Securities pursuant thereto, the Issuer shall, in addition to performing those acts
required to be performed under the Securities Act and/or the Exchange Act or deemed advisable by
the Issuer, deliver to each Holder written notice thereof, signed by the Chief Financial Officer or
Chief Executive Officer of the Issuer. Upon receipt of such notice, the Holders shall discontinue
disposition of the Registrable Securities pursuant to the Registration Statement and prospectus
until such Holders (x) are advised in writing by the Issuer that the use of the Registration
Statement and prospectus (and offers and sales thereunder) may be resumed, (y) have received copies
of a supplemental or amended prospectus, if applicable, and (z) have received copies of any
additional or supplemental filings which are incorporated or deemed to be incorporated by reference
into such prospectus. The Issuer will exercise commercially reasonable efforts to ensure that the
use of the Registration Statement and prospectus may be resumed as quickly as practicable.

          (b) The Issuer’s right to suspend the effectiveness of the Registration Statement and the
offers and sales of the Registrable Securities pursuant thereto, as described above in this Section
6.5(a), shall be for a period of time (the “Suspension Period”) beginning on the date of the
occurrence of the Suspension Event and expiring on the earlier to occur of (i) the date on which
the Suspension Event ceases, or (ii) ninety (90) days after the occurrence of the Suspension Event;
provided, however, that there shall not be more than two Suspension Periods in any 12-
month period. Notwithstanding the foregoing, the Issuer shall be able to suspend the effectiveness
of the Registration Statement and offers and sales of the Registrable Securities for any time
period as may reasonably be required in order to update the Registration
Statement to replace financial information which is no longer current, as required by
applicable securities law.

          (c) In addition, in connection with any underwritten public offering of securities of the
Issuer, if requested by the Issuer or its managing underwriter, each Holder will enter into a
lock-up agreement pursuant to which such Holder will not, during the seven (7) days prior to, and
for a period no longer than one hundred eighty (180) days following, the date of the prospectus (or
if the offering is pursuant to a shelf registration statement, the date of the pricing prospectus
supplement) relating to the offering, offer, sell or otherwise dispose of any securities of the
Issuer without the prior consent of the Issuer and the managing underwriter, provided that the
executive officers and directors of the Issuer enter into lockup agreements for a period at least
as long and on the same terms.

     6.6 Transfer of Securities. An Investor may transfer all or any part of its
Securities to any Person under common management with the Investor; provided, that any such
transfer shall be effected in full compliance with all applicable federal and state securities
laws, including, but not limited to, the Securities Act and the rules of the SEC promulgated
thereunder. The Issuer will effect such transfer of restricted certificates and will promptly
amend or supplement the

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Prospectus forming a part of the Registration Statement to add the
transferee to the selling stockholders in the Registration Statement; provided that the
transferor and transferee shall be required to provide the Issuer with the information requested of
the Investor in this Agreement, information reasonably necessary for the Issuer to determine that
the transfer was effected in accordance with all applicable federal and state securities laws,
including, but not limited to, the Securities Act and the rules of the SEC promulgated thereunder,
and all other information reasonably requested by the Issuer from time to time in connection with
any transfer, registration, qualification or compliance referred to in Section 6.4.

7. INDEMNIFICATION.

     7.1 Indemnification by the Issuer. The Issuer will indemnify and hold harmless each
Holder of Registrable Securities which are included in a registration statement pursuant to the
provisions of Section 6 hereof and any underwriter (as defined in the Securities Act) for such
Holder, and any person who controls such Holder within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act or such underwriter within the meaning of the
Securities Act, and any officer, director, investment adviser, employee, agent, partner, member or
affiliate of such Holder (each, a “Holder Indemnified Party”), from and against, and will reimburse
each such Holder Indemnified Party with respect to, any and all claims, actions, demands, losses,
damages, liabilities, costs and reasonably incurred expenses to which such Holder or any such
Holder Indemnified Party may become subject under the Securities Act or otherwise, insofar as such
claims, actions, demands, losses, damages, liabilities, costs or reasonably incurred expenses arise
out of or are based upon (i) any untrue statement or alleged untrue statement of any material fact
contained in such registration statement, any prospectus contained therein or any amendment or
supplement thereto, or arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the statements therein
not misleading, or (ii) any materially inaccurate representation or breach of any material
warranty, agreement or covenant of the Issuer contained
herein; provided, however, that the Issuer will not be liable in any such case to the
extent that any such claim, action, demand, loss, damage, liability, cost or expense is caused by
an untrue statement or alleged untrue statement or omission or alleged omission (1) made in
conformity with information furnished by such Holder in writing specifically for use in the
preparation thereof, or (2) which was cured in an amendment or supplement to the prospectus (or any
amendment or supplement thereto) delivered to the Holder on a timely basis to permit proper
delivery thereof prior to the date on which any Registrable Securities were transferred or sold.

     7.2 Indemnification by the Holder. Each Holder of Registrable Securities which are
included in a registration statement pursuant to the provisions of Section 6 hereof will indemnify
and hold harmless the Issuer, and any Person who controls the Issuer within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act, and any officer, director,
employee, agent, partner, member or affiliate of the Issuer (each, an “Issuer Indemnified Party”)
from and against, and will reimburse the Issuer Indemnified Parties with respect to, any and all
losses, damages, liabilities, costs or reasonably incurred expenses to which such Issuer
Indemnified Parties may become subject under the Securities Act or otherwise,

17

 

insofar as such
losses, damages, liabilities, costs or reasonably incurred expenses are caused by any untrue or
alleged untrue statement of any material fact contained in such registration statement, any
prospectus contained therein or any amendment or supplement thereto, or are caused by the omission
or the alleged omission to state therein a material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances in which they were made, not
misleading, in each case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was so made solely in reliance upon and in
conformity with written information furnished by such Holder specifically for use in the
preparation thereof; provided, however, that the liability of any Holder pursuant to this
Section 7.2 shall be limited to an amount not to exceed the net proceeds received by such Holder
from the sale of Registrable Securities pursuant to the registration statement which gives rise to
such obligation to indemnify.

     7.3 Procedures. Promptly after receipt by a party indemnified pursuant to the
provisions of Section 7.1 or Section 7.2 of notice of the commencement of any action involving the
subject matter of the foregoing indemnity provisions, such indemnified party will, if a claim
thereof is to be made against the indemnifying party pursuant to the provisions of Section 7.1 or
Section 7.2, notify the indemnifying party of the commencement thereof; but the omission to so
notify the indemnifying party will not relieve it from any liability which it may have to an
indemnified party otherwise than under this Section 7 and shall not relieve the indemnifying party
from liability under this Section 7, except to the extent that such indemnifying party is
materially prejudiced by such omission. In case such action is brought against any indemnified
party and such indemnified party notifies the indemnifying party of the commencement thereof, the
indemnifying party shall have the right to participate in, and, to the extent that it may wish,
jointly with any other indemnifying party similarly notified, to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified party, and after notice from the indemnifying
party to such indemnified party of its election to assume the defense thereof, the indemnifying
party will not be liable to such indemnified party pursuant to the provisions of Section 7.1 or
Section 7.2 for any legal or other expense subsequently incurred by such
indemnified party in connection with the defense thereof. No indemnifying party shall be
liable to an indemnified party for any settlement of any action or claim without the consent of the
indemnifying party. No indemnifying party will consent to entry of any judgment or enter into any
settlement which does not include as an unconditional term thereof the giving by the claimant or
plaintiff to such indemnified party of a release from all liability in respect to such claim or
litigation.

8. CONDITIONS TO CLOSING.

     8.1 Conditions to the Obligations of the Investor. The obligation of the Investor to
proceed with the Closing is subject to the following conditions, any and all of which may be waived
by the Investor, in whole or in part, to the extent permitted by applicable law:

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          (a) Representations and Warranties. Each of the representations and warranties of the
Issuer contained in this Agreement shall be true and correct in all material respects as of the
Closing as though made on and as of the Closing, except (i) for changes specifically permitted by
this Agreement, (ii) that those representations and warranties which address matters only as of a
particular date shall remain true and correct as of such date, and (iii) such failures to be true
and correct which would not, individually or in the aggregate, have a Material Adverse Effect on
the Issuer. Unless the Investor receives written notice to the contrary at the Closing, Investor
shall be entitled to assume that the preceding is accurate in all respects at the Closing.

          (b) Agreement and Covenants. The Issuer shall have performed or complied in all
material respects with all agreements and covenants required by this Agreement to be performed or
complied with by it on or prior to the Closing. Unless the Investor receives written notice to the
contrary at the Closing, Investor shall be entitled to assume that the preceding is accurate in all
respects at the Closing.

          (c) No Order. No Governmental Authority shall have enacted, issued, promulgated,
enforced or entered any statute, rule, regulation, executive order, decree, injunction, or other
order (whether temporary, preliminary or permanent) which is in effect and which materially
restricts, prevents or prohibits consummation of the Closing or any transaction contemplated by
this Agreement.

          (d) Opinion of Issuer’s Counsel. The Investor shall have received an opinion of
Issuer’s counsel, dated the Closing Date, in the form attached hereto as Exhibit C.

          (e) Closing Certificate. The Investor shall have received a certificate executed by
the Chief Executive Officer or Chief Financial Officer of the Issuer, dated as of the Closing, to
the effect that the conditions set forth in Sections 8.1(a) and (b) have been fulfilled.

     8.2 Conditions to the Obligations of the Issuer. The obligation of the Issuer to
proceed with the Closing is subject to the following conditions, any and all of which may be waived
by the Issuer, in whole or in part, to the extent permitted by applicable law:

          (a) Representations and Warranties. Each of the representations and warranties of the
Investor contained in this Agreement shall be true and correct as of the Closing as though made on
and as of the Closing, except (i) for changes specifically permitted by this Agreement, and (ii)
that those representations and warranties which address matters only as of a particular date shall
remain true and correct as of such date. Unless the Issuer receives written notification to the
contrary at the Closing, the Issuer shall be entitled to assume that the preceding is accurate in
all respects at the Closing.

          (b) Agreement and Covenants. The Investor shall have performed or complied in all
material respects with all agreements and covenants required by this Agreement to be performed or
complied with by it on or prior to the Closing. Unless the Issuer receives written notification to
the contrary at the Closing, the Issuer shall be entitled to assume that the preceding is accurate
in all respects at the Closing.

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          (c) No Order. No Governmental Authority shall have enacted, issued, promulgated,
enforced or entered any statute, rule, regulation, executive order, decree, injunction, or other
order (whether temporary, preliminary or permanent) which is in effect and which materially
restricts, prevents or prohibits consummation of the Closing or any transaction contemplated by
this Agreement.

9. MISCELLANEOUS.

     9.1 Defined Terms. As used herein the following terms shall have the following
meanings:

          (a) “Affiliate” shall have the meaning ascribed to it in Rule 12b-2 of the General Rules and
Regulations under the Exchange Act, as in effect on the date hereof.

          (b) “Agreement” has the meaning specified in the preamble to this Agreement.

          (c) “Bylaws” means the Bylaws of the Issuer, as the same may be supplemented, amended, or
restated from time to time.

          (d) “Certificate of Incorporation” means the Issuer’s Certificate of Incorporation, as the
same may be supplemented, amended or restated from time to time.

          (e) “Closing” has the meaning specified in Section 2.2 of this Agreement.

          (f) “Common Stock” has the meaning specified in the Recitals to this Agreement.

          (g) “Confidential Information” has the meaning specified in Section 5.4 of this Agreement.

          (h) “Contract” means any indenture, lease, sublease, loan agreement, mortgage, note,
restriction, commitment, obligation or other contract, agreement or instrument.

          (i) “Exchange Act” means the Securities Exchange Act of 1934, as amended.

          (j) “GAAP” means generally accepted accounting principles in effect in the United States of
America.

          (k) “Governmental Authority” means any nation or government, any state or other political
subdivision thereof, and any entity or official exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government.

          (l) “Holder” has the meaning specified in Section 6.1 of this Agreement.

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          (m) “Indemnified Party” has the meaning specified in Section 7.1 of this Agreement.

          (n) “Intellectual Property Rights” has the meaning specified in Section 3.15 of this
Agreement.

          (o) “Investor” has the meaning specified in the preamble to this Agreement.

          (p) “Issuer” means ReGen Biologics, Inc., a Delaware corporation.

          (q) “Issuer Indemnified Party” has the meaning specified in Section 7.2 of this Agreement.

          (r) “Lien” means any mortgage, pledge, security interest, encumbrance, lien or charge of any
kind (including any conditional sale or other title retention agreement, any lease in the nature
thereof, and the filing of or agreement to give any financing statement under the Uniform
Commercial Code or comparable law of any jurisdiction in connection with such mortgage, pledge,
security interest, encumbrance, lien or charge).

          (s) “Material Adverse Effect” means a material and adverse change in, or effect on, the
financial condition, properties, assets, liabilities, rights, obligations, operations or business,
of a Person and its Subsidiaries taken as a whole.

          (t) “Medwork” means Medwork AG, a Swiss company.

          (u) “Offering” has the meaning specified in the Recitals to this Agreement.

          (v) “Permit” means any permit, certificate, consent, approval, authorization, order, license,
variance, franchise or other similar indicia of authority issued or granted by any Governmental
Authority.

          (w) “Person” means an individual, partnership, corporation, business trust, joint stock
company, estate, trust, unincorporated association, joint venture, Governmental Authority or other
entity, of whatever nature.

          (x) “Preferred Stock” means shares of the Issuer’s preferred stock, par value $0.01 per share.

          (y) “Purchase Price” has the meaning specified in Section 1.1 of this Agreement.

          (z) “Register”, “registered” and “registration” refer to a registration of the offering and
sale or resale of Common Stock effected by preparing and filing a registration statement in
compliance with the Securities Act and the declaration or ordering of the effectiveness of such
registration statement.

21

 

          (aa) “Registrable Securities” means all Shares of Common Stock acquired by the Investor
pursuant to this Agreement, the Warrant Shares and any other shares of Common Stock or other
securities issued in respect of such Shares by way of a stock dividend or stock split or in
connection with a combination or subdivision of the Issuer’s Common Stock or by way of a
recapitalization, merger or consolidation or reorganization of the Issuer; provided,
however, that as to any particular securities, such securities will cease to be Registrable
Securities until the earlier of (i) the sale of such securities pursuant to registration or in a
transaction exempt from the registration and prospectus delivery requirements of the Securities Act
under Section 4(1) thereof, (ii) the date that such securities are permitted to be disposed
pursuant to Rule 144 under the Securities Act, or (iii) the date on which all such securities cease
to be outstanding; and, as a result of the event or circumstance described in either of the
foregoing clauses (i) or (ii), all transfer restrictions and restrictive legends with respect
thereto are removed or removable in accordance with this Agreement or such legends, as the case may
be.

          (bb) “Requirements of Law” means as to any Person, the certificate of incorporation, by-laws
or other organizational or governing documents of such Person, and any domestic or foreign and
federal, state or local law, rule, regulation, statute or ordinance or determination of any
arbitrator or a court or other Governmental Authority, in each case applicable to, or binding upon,
such Person or any of its properties or to which such Person or any of its property is subject.

          (cc) “Rule 144” has the meaning specified in Section 6.2 of this Agreement.

          (dd) “SEC” means the Securities and Exchange Commission.

          (ee) “SEC Reports” has the meaning specified in Section 3.7 of this Agreement.

          (ff) “Securities” means the Shares, the Warrants and the Warrant Shares.

          (gg) “Securities Act” means the Securities Act of 1933, as amended.

          (hh) “Shares” has the meaning specified in Section 1.1 of this Agreement.

          (ii) “Registration Statement” has the meaning specified in Section 6.2 of this Agreement.

          (jj) “Subsidiary” means as to any Person, a corporation or limited partnership of which more
than 50% of the outstanding capital stock or partnership interests having full voting power is at
the time directly or indirectly owned or controlled by such Person.

          (kk) “Suspension Event” has the meaning specified in Section 6.6(a) of this Agreement.

22

 

          (ll) “Suspension Period” has the meaning specified in Section 6.6(b) of this Agreement.

          (nn) “Warrant” has the meaning specified in the Recitals to this Agreement.

          (oo) “Warrant Shares” has the meaning specified in Section 3.6 of this Agreement.

     9.2 Other Definitional Provisions.

          (a) All terms defined in this Agreement shall have the defined meanings when used in any
certificates, reports or other documents made or delivered pursuant hereto or thereto, unless the
context otherwise requires.

          (b) Terms defined in the singular shall have a comparable meaning when used in the plural, and
vice versa.

          (c) All accounting terms shall have a meaning determined in accordance with GAAP.

          (d) The words “hereof,” “herein” and “hereunder,” and words of similar import, when used in
this Agreement shall refer to this Agreement as a whole (including any exhibits and schedules
hereto) and not to any particular provision of this Agreement.

     9.3 Notices. All notices, requests, demands, claims, and other communications
hereunder shall be in writing and shall be delivered by certified or registered mail (first class
postage pre-paid), guaranteed overnight delivery, or facsimile transmission if such transmission is
confirmed by delivery by certified or registered mail (first class postage pre-paid) or guaranteed
overnight delivery, to the following addresses and telecopy numbers (or to such other addresses or
telecopy numbers which such party shall subsequently designate in writing to the other party):

          (a) if to the Issuer to:

ReGen Biologics, Inc.

509 Commerce Street

Franklin Lakes, NJ 07417

Attention: Brion D. Umidi

Telecopy: 201.651.5141

with a copy to:

Pillsbury Winthrop Shaw Pittman LLP

1650 Tysons Boulevard

McLean, VA 22102

Attention: David C. Main, Esq.

Telecopy: 703.770.7901

23

 

          (b) if to the Investor to the address or telecopy number set forth next to its name on the
signature page hereto.

     Each such notice or other communication shall for all purposes of this Agreement be treated as
effective or having been given when delivered if delivered by hand, by messenger or by courier, or
if sent by facsimile, upon confirmation of receipt.

     9.4 Entire Agreement. This Agreement (including the exhibits and schedules attached
hereto) and other documents delivered at the Closing pursuant hereto, contain the entire
understanding of the parties in respect of its subject matter and supersede all prior agreements
and understandings between the parties with respect to such subject matter.

     9.5 Expenses; Taxes. Except as otherwise provided in this Agreement, the parties
shall pay their own fees and expenses, including their own counsel fees, incurred in connection
with this Agreement or any transaction contemplated hereby. Any sales tax, stamp duty, deed
transfer or other tax (except taxes based on the income of the Investor) arising out of the
issuance of the Securities (but not with respect to subsequent transfers) by the Issuer to the
Investor and consummation of the transactions contemplated by this Agreement shall be paid by the
Issuer.

     9.6 Amendment; Waiver. This Agreement may not be modified, amended, supplemented,
canceled or discharged, except by written instrument executed by both parties. No failure to
exercise, and no delay in exercising, any right, power or privilege under this Agreement shall
operate as a waiver, nor shall any single or partial exercise of any right, power or privilege
hereunder preclude the exercise of any other right, power or privilege. No waiver of any breach of
any provision shall be deemed to be a waiver of any preceding or succeeding breach of the same or
any other provision, nor shall any waiver be implied from any course of dealing between the
parties. No extension of time for performance of any obligations or other acts hereunder or under
any other agreement shall be deemed to be an extension of the time for performance of any other
obligations or any other acts. The rights and remedies of the parties under this Agreement are in
addition to all other rights and remedies, at law or equity, that they may have against each other.

     9.7 Binding Effect; Assignment. The rights and obligations of this Agreement shall
bind and inure to the benefit of the parties and their respective successors and legal assigns.
The rights and obligations of this Agreement may not be assigned by any party without the prior
written consent of the other party.

     9.8 Counterparts; Facsimile Signature. This Agreement may be executed by facsimile
signature and in any number of counterparts, each of which shall be an original but all of which
together shall constitute one and the same instrument.

24

 

     9.9 Headings. The headings contained in this Agreement are for convenience of
reference only and are not to be given any legal effect and shall not affect the meaning or
interpretation of this Agreement.

     9.10 Governing Law; Interpretation. This Agreement shall be construed in accordance
with and governed for all purposes by the laws of the State of New York applicable to contracts
executed and to be wholly performed within such State.

     9.11 Severability. The parties stipulate that the terms and provisions of this
Agreement are fair and reasonable as of the date of this Agreement. However, any provision of this
Agreement shall be determined by a court of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Agreement
shall remain in full force and effect and shall in no way be affected, impaired or invalidated.
If, moreover, any of those provisions shall for any reason be determined by a court of competent
jurisdiction to be unenforceable because excessively broad or vague as to duration, activity or
subject, it shall be construed by limiting, reducing or defining it, so as to be enforceable.

[SIGNATURES AND OTHER INFORMATION ON NEXT THREE PAGES]

25

 

          IN WITNESS WHEREOF, the parties hereto have caused this Subscription Agreement to be
duly executed and delivered as of the date set forth below.

	 	 	 	 	 	 	 	 	 	 	 
	NAME OF INVESTOR:	 	 	 	ADDRESS FOR NOTICES (Please Print):	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	SIGNATURE:	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Attention:	 	 	 	 
	By:

	 	 	 	 	 	Telecopy:
	 	 

	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	 	 	Phone:	 	 	 	 
	 

	 	Title:
	 	 	 	Email Address:
	 	 

	 	 
	 

	 	 	 	 	 	 	 	 

	 	 
	 	 	 	 	 	 	Tax Identification #:	 	 
	 

	 	 	 	 	 	 	 	 

	 	 
	Exact Name to appear on Stock
Certificate:	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Number of Shares Subscribed For:	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Number of Warrants Subscribed	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	For (30% of the Number of Shares):	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Aggregate Purchase Price
(see Section 1.1):	 	 	 	$                                                            	 	 

The Investor hereby provides the following additional information:

     (a) Excluding the shares of Common Stock and the number of Warrants subscribed for above, set
forth below is the number of shares of Common Stock and options, rights or warrants of ReGen
Biologics, Inc. (“Options” and together with the Common Stock, “Owned Securities”) which the
Investor beneficially owns or of which the Investor is the record owner on the date hereof.
Please refer to the definition of beneficial ownership on Exhibit D attached
hereto. If none, please so state.

Number of
Shares:                                             
(excluding the Shares subscribed for above)

Number of Options:                                              

Please indicate by an asterisk (*) above if the Investor disclaims “beneficial ownership”
of any of the above listed Owned Securities, and indicate in response to question (b) below who has
beneficial ownership.

     (b) If the Investor disclaims “beneficial ownership” in question (a), please furnish
the following information with respect to the person(s) other than the Investor who is the
beneficial owner(s) of the Owned Securities in question. If not applicable, please check box: o

26

 

Name of Beneficial Owner:                                                                                                    

Relationship to the Investor:                                                                                

Number of Owned Securities Beneficially Owned:                                                            

27

 

NAME OF INVESTOR:                                        

     (c) As to the Owned Securities indicated as being “beneficially owned” in answers to
question (a) and (b) does any person other than the person identified as the “beneficial
owner” have:

          (i) the sole or shared power to vote or to direct the vote of any such Owned Securities?

          Yes
o No o

or      (ii) the sole or shared power to dispose or to direct the disposition of any such Owned
Securities (referred to as “dispositive power”)?

          Yes
o No o

If the answer is “Yes” to either of the forgoing questions, the Investor should set forth below the
name and address of each person who has either such power or with whom the indicated
“beneficial owner” shares such power, together with such number of shares to which such
rights relates.

 

 

 

IF THE INVESTOR IS AN ENTITY OR A TRUST:

The Investor must list the name of each natural person associated with the Investor entity or trust
who has or shares voting or dispositive power with respect to the shares indicated as being
“beneficially owned” in answers to questions (a) or (c). For an investment or holding
company, the investment manager(s) would normally be the person(s) who hold(s) or share(s) voting
and dispositive power. For a trust, the natural person(s) holding or sharing voting or dispositive
power would normally be the trustee(s). For other types of entities, the natural person(s) holding
or sharing voting or dispositive power would normally be the officer(s) empowered by the board of
directors to make such decisions, or if there is no such officer, each of the directors.
Disclosure is required for each natural person who in practice has voting or dispositive power,
regardless of that person’s formal title or position within the organization.

28

 

NAME OF INVESTOR:                                        

	 	 	 	 	 	 	 
	 	 	Type of Power:	 	 	 	 
	Name of Natural	 	Voting/Dispositive/	 	 	 	 
	Person	 	Both	 	Address	 	Position or Title
	 
	 	 	 	 	 	 
	 

     (d) In any pending legal proceeding, is the Investor or any of its affiliates a party, or does
the Investor or any such associate have an interest, adverse to the Issuer or any affiliate of the
Issuer?

          Yes
o No o

If the answer is “Yes,” please describe, and state the nature and amount of, such interest.

 

 

 

 

     (e) Is there any family relationship (including relationships by blood, marriage, and
adoption, except those more remote than first cousin) between the Investor or any of its affiliates
and any director or officer of the Issuer, any affiliate of the Issuer or any person who has been
chosen to become a director or officer of the Issuer?

          Yes
o No o

If the answer is “Yes,” please describe the relationship.

 

 

 

 

29

 

     (f) Are any of the Owned Securities listed in response to question (a) the subject of a voting
agreement, contract or other arrangement whereby others have voting control over, or any other
interest in, any of the Investor’s Owned Securities?

          o Yes o No

If the answer is “Yes”, please give details:                                                                                .

     (g) Please describe each position, office or other material relationship which the Investor
has had with the Issuer or any of its affiliates, including any Subsidiary of the Issuer, within
the past three years. Please include a description of any loans or other indebtedness, and any
contracts or other arrangements or transactions involving a material amount, payable by the
Investor to the Issuer or any of its affiliates, including its Subsidiaries, or by the Issuer or
any of its affiliates, including its Subsidiaries, to the Investor. “Affiliates” of the Issuer
include its directors and executive officers, and any other person controlling or controlled by the
Issuer. If none, please so state.

Answer:

     (h) Please provide the name and address of other person(s), if any, to whom any proxy
statements, registration statements (including notice of effectiveness thereof), prospectuses or
similar documents and information should be delivered by the Issuer on behalf of the Investor in
the future, with respect to the Investor’s shares:

	 	 	 	 	 	 	 	 	 
	 

	 	 

	 	 	 	 

	 	 
	 

	 	 

	 	 	 	 

	 	 
	 

	 	 

	 	 	 	 

	 	 
	 

	 	 

	 	 	 	 

	 	 

     (i) Please advise of special stock certificate delivery requirements for closing, if any:

     (j) Please advise if a NASD member has placed with you the Shares and Warrants being purchased
hereunder: (Name of Member:)                                                                                 

30

 

ACCEPTED THIS ___th DAY OF                     , 2006 BY:

REGEN BIOLOGICS, INC.

	 	 	 	 	 
	By:
	 	 	 	 
	 

	 	 
 Name:
Brion D. Umidi	 	 
	 	 	Title: Senior Vice President and Chief Financial Officer

31

 

EXHIBIT A

FORM OF WARRANT

 

 

EXHIBIT B

RISK FACTORS RELATED TO THE OFFERING

SALES OR THE PERCEPTION OF FUTURE SALES OF OUR COMMON STOCK MAY DEPRESS OUR STOCK PRICE. BECAUSE
THE MARKET PRICES FOR BIOTECHNOLOGY AND MEDICAL DEVICE STOCKS ARE LIKELY TO REMAIN VOLATILE, OUR
STOCK PRICE MAY BE MORE ADVERSELY AFFECTED THAN OTHER COMPANIES BY SUCH FUTURE SALES.

Sales of substantial numbers of shares of our Common Stock in the public market, or the perception
that significant sales are likely, could adversely affect the market price of our Common Stock.
Compliance with the registration rights provisions of the Subscription Agreement could create the
perception that all Shares that are a part of this Offering (up to $5 million worth of shares) will
soon be available for sale, and this number of shares is greater than the average trading volume
for our shares. No prediction can be made as to the effect, if any, that market sales of such
shares will have on the market price of our Common Stock. Sales of substantial amounts of such
shares in the public market could adversely affect the market price of our Common Stock.

THE OFFERING PRICE OF THE SHARES MAY NOT BEAR ANY RELATIONSHIP TO OUR ASSETS, BOOK VALUE, EARNINGS
HISTORY, OR OTHER ESTABLISHED CRITERIA. AS A RESULT, YOU MAY EXPERIENCE IMMEDIATE AND SUBSTANTIAL
DILUTION.

The offering price of the Shares was established based on such factors as our capital requirements,
financial conditions and prospects, percentage of ownership to be held by investors following this
Offering, and the general condition of securities markets at the time of the Offering. The
offering price does not necessarily bear any relationship to our assets, book value, earnings
history or other established criteria of value. As a result, you may experience immediate and
substantial dilution.

WE ARE UNABLE TO DETERMINE WITH CERTAINTY WHEN THE REGISTRATION STATEMENT TO BE FILED WITH THE SEC
WILL BE DECLARED EFFECTIVE. CONSEQUENTLY, YOU MAY NOT BE ABLE TO SELL YOUR SHARES FOR A
SUBSTANTIAL PERIOD OF TIME.

Although we have undertaken to register the Shares for resale by you, you should be aware that we
are unable to determine with certainty when the registration statement to be filed with the SEC
will become effective. The SEC may seek to review our registration statement, in which case, the
period necessary to achieve effectiveness of the registration statement with the SEC will be
affected by our ability to provide the SEC with sufficient disclosures satisfactory to the SEC.
The length of the SEC review process is uncertain and may extend to a number of months.

 

 

As you are aware, the Shares being sold in this Offering are restricted in nature and may not be
publicly resold absent the effectiveness of the registration statement or pursuant to an applicable
exemption from registration. Consequently, you may not be able to sell your Shares for a
substantial period of time.

WE MAY ALLOCATE THE NET PROCEEDS OF THIS OFFERING IN WAYS WITH WHICH YOU MAY NOT AGREE.

We will have broad discretion in how we apply the net proceeds from this Offering. Because the net
proceeds of this Offering are not required to be allocated to any specific investment or
transaction, you cannot determine at this time the value or appropriateness of our application of
the net proceeds, and you and other shareholders may not agree with our decisions. For example, we
may attempt to acquire other businesses or assets using a portion of the net proceeds of this
Offering which otherwise could have been used for working capital. There can be no assurance that
we will be able to acquire any desirable businesses or assets or that, if acquired, that we will be
able to successfully develop or integrate such businesses or assets.

 

 

EXHIBIT C

 

FORM OF OPINION

[Not Filed with this Current Report]

 

 

EXHIBIT D

 

Explanation of “BENEFICIAL OWNERSHIP”

Securities that are subject to a power to vote or dispose are deemed beneficially owned by the
person who holds such power, directly or indirectly. This means that the same securities may be
deemed beneficially owned by more than one person, if such power is shared. In addition, the
beneficial ownership rules provide that shares which may be acquired upon exercise of an option or
warrant, or which may be acquired upon the termination of a trust, discretionary account or similar
arrangement, which can be effected within a period of 60 days from the date of determination, are
deemed to be “beneficially” owned. Furthermore, shares that are subject to rights or powers even
though such rights or powers to acquire are not exercisable within the 60-day period may also be
deemed to be beneficially owned if the rights or powers were acquired “with the purpose or effect
of changing or influencing the control of the issuer or in connection with or as a participant in
any transaction having such purpose or effect.”

In determining whether securities are “beneficially owned,” benefits which are substantially
equivalent to those of ownership by virtue of any contract, understanding, relationship, agreement
or other arrangement should cause the securities to be listed as “beneficially owned.”

Thus, for example, securities held for a person’s benefit in the name of others or in the name of
any estate or trust in which such person may be interested should also be listed. Securities held
by a person’s spouse, children or other members of such person’s family who are such person’s
dependents or who live in such person’s household should be listed as “beneficially owned” unless
such person does not enjoy benefits equivalent to those of ownership with respect to such
securities.

If a person has a proprietary or beneficial interest in a controlled corporation, partnership,
personal holding company, trust or estate which owns of record or beneficially any securities, such
person should state the amount of such securities owned by such controlled corporation,
partnership, personal holding company, trust or estate in lieu of allocating such person’s
proprietary interest, and by note or otherwise, please indicate that. In any case, the name of the
controlled corporation, partnership, personal holding company, or estate must be stated.

In all cases the nature of the beneficial ownership should be stated.

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