Document:

Exhibit 10.1

 

EXECUTION VERSION

 

 

SENIOR UNSECURED TERM CREDIT AGREEMENT

 

dated as of

July 15, 2008,

 

among

 

EXCO OPERATING COMPANY, LP,

as Borrower

 

CERTAIN SUBSIDIARIES OF BORROWER,

as Guarantors

 

The Lenders Party Hereto

 

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent

 

J.P. MORGAN SECURITIES INC.,

as Sole Bookrunner and Lead Arranger

 

$500,000,000 Senior Unsecured Term Facility

 

 

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  I

  	
  DEFINITIONS

  	
  1

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 1.01.

  	
  Defined Terms

  	
  1

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 1.02.

  	
  Types of Loans and Borrowings

  	
  18

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 1.03.

  	
  Terms Generally

  	
  19

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 1.04.

  	
  Accounting Terms; GAAP

  	
  19

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 1.05.

  	
  Oil and Gas Definitions

  	
  19

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 1.06.

  	
  Time of Day

  	
  19

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  II

  	
  THE CREDITS

  	
  20

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 2.01.

  	
  Commitments

  	
  20

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.02.

  	
  Repayment of Loans

  	
  20

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.03.

  	
  Increases in the Commitments

  	
  20

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.04.

  	
  Requests for Borrowings

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.05.

  	
  [Reserved]

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.06.

  	
  Funding of Borrowings

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.07.

  	
  Interest Elections

  	
  22

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.08.

  	
  Repayment of Loans; Evidence of Debt

  	
  23

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.09.

  	
  Optional Prepayment of Loans

  	
  24

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.10.

  	
  Mandatory Prepayment of Loans

  	
  25

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.11.

  	
  Fees

  	
  25

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.12.

  	
  Interest

  	
  25

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.13.

  	
  Alternate Rate of Interest

  	
  26

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.14.

  	
  Increased Costs

  	
  27

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.15.

  	
  Break Funding Payments

  	
  28

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.16.

  	
  Taxes

  	
  28

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.17.

  	
  Payments Generally; Pro Rata Treatment; Sharing of
  Set-offs

  	
  29

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 2.18.

  	
  Mitigation Obligations; Replacement of Lenders

  	
  31

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  III

  	
  [RESERVED]

  	
  32

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  IV

  	
  REPRESENTATIONS AND WARRANTIES

  	
  32

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 4.01.

  	
  Organization; Powers

  	
  32

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.02.

  	
  Authorization; Enforceability

  	
  32

  
					

 

i

 

	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.03.

  	
  Governmental Approvals; No Conflicts

  	
  33

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.04.

  	
  Financial Condition; No Material Adverse Change

  	
  33

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.05.

  	
  Properties

  	
  33

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.06.

  	
  Litigation and Environmental Matters

  	
  34

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.07.

  	
  Compliance with Laws and Agreements

  	
  34

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.08.

  	
  Investment Company Status

  	
  34

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.09.

  	
  Taxes

  	
  34

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.10.

  	
  ERISA

  	
  35

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.11.

  	
  Disclosure

  	
  35

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.12.

  	
  Labor Matters

  	
  35

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.13.

  	
  Capitalization and Credit Party Information

  	
  35

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.14.

  	
  Margin Stock

  	
  35

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.15.

  	
  Oil and Gas Interests

  	
  35

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.16.

  	
  Insurance

  	
  36

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 4.17.

  	
  Solvency

  	
  36

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  V

  	
  CONDITIONS

  	
  37

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 5.01.

  	
  Effective Date

  	
  37

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 5.02.

  	
  Each Credit Event

  	
  39

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  VI

  	
  AFFIRMATIVE COVENANTS

  	
  39

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 6.01.

  	
  Financial Statements; Other Information

  	
  39

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.02.

  	
  Notices of Material Events

  	
  41

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.03.

  	
  Existence; Conduct of Business

  	
  42

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.04.

  	
  Payment of Obligations

  	
  42

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.05.

  	
  Maintenance of Properties; Insurance

  	
  42

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.06.

  	
  Books and Records; Inspection Rights

  	
  43

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.07.

  	
  Compliance with Laws

  	
  43

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.08.

  	
  Use of Proceeds

  	
  43

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.09.

  	
  [Reserved]

  	
  43

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.10.

  	
  [Reserved]

  	
  43

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.11.

  	
  [Reserved]

  	
  43

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.12.

  	
  Operation of Oil and Gas Interests

  	
  43

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 6.13.

  	
  Restricted Subsidiaries

  	
  43

  
					

 

ii

 

	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  VII

  	
  NEGATIVE COVENANTS

  	
  44

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 7.01.

  	
  Indebtedness

  	
  44

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.02.

  	
  Liens

  	
  45

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.03.

  	
  Fundamental Changes

  	
  46

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.04.

  	
  Investments, Loans, Advances, Guarantees and
  Acquisitions

  	
  47

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.05.

  	
  Swap Agreements

  	
  48

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.06.

  	
  Restricted Payments

  	
  48

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.07.

  	
  Transactions with Affiliates

  	
  48

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.08.

  	
  Restrictive Agreements

  	
  48

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.09.

  	
  Disqualified Stock; Fiscal Year

  	
  49

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.10.

  	
  Amendments to Organizational Documents and Certain
  Liens and Guarantees

  	
  49

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.11.

  	
  Financial Covenants

  	
  49

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 7.12.

  	
  Sale and Leaseback Transactions and other
  Off-Balance Sheet Liabilities

  	
  49

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  VIII

  	
  GUARANTEE OF OBLIGATIONS

  	
  50

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 8.01.

  	
  Guarantee of Payment

  	
  50

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 8.02.

  	
  Guarantee Absolute

  	
  50

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 8.03.

  	
  Guarantee Irrevocable

  	
  50

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 8.04.

  	
  Reinstatement

  	
  51

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 8.05.

  	
  Subrogation

  	
  51

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 8.06.

  	
  Subordination

  	
  51

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 8.07.

  	
  Payments Generally

  	
  51

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 8.08.

  	
  Setoff

  	
  52

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 8.09.

  	
  Formalities

  	
  52

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 8.10.

  	
  Limitations on Guarantee

  	
  52

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  IX

  	
  EVENTS OF DEFAULT

  	
  52

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  X

  	
  THE ADMINISTRATIVE AGENT

  	
  55

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  XI

  	
  MISCELLANEOUS

  	
  57

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 11.01.

  	
  Notices

  	
  57

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 11.02.

  	
  Waivers; Amendments

  	
  57

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 11.03.

  	
  Expenses; Indemnity; Damage Waiver

  	
  58

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 11.04.

  	
  Successors and Assigns

  	
  60

  
					

 

iii

 

	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 11.05.

  	
  Survival

  	
  63

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 11.06.

  	
  Counterparts; Integration; Effectiveness

  	
  63

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 11.07.

  	
  Severability

  	
  64

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 11.08.

  	
  Right of Setoff

  	
  64

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 11.09.

  	
  GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE OF
  PROCESS

  	
  64

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 11.10.

  	
  WAIVER OF JURY TRIAL

  	
  65

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 11.11.

  	
  Headings

  	
  65

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 11.12.

  	
  Confidentiality

  	
  65

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 11.13.

  	
  Interest Rate Limitation

  	
  66

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Section 11.14.

  	
  USA PATRIOT Act

  	
  66

  

 

iv

 

SCHEDULES:

 

Schedule 2.01 – Applicable Percentages and Initial Commitments

Schedule 4.06 – Disclosed Matters

Schedule 4.13 – Capitalization and Credit Party Information

Schedule 7.01 – Existing Indebtedness

Schedule 7.02 – Existing Liens

Schedule 7.07 – Transactions with Affiliates

Schedule 7.08 – Existing Restrictions

 

EXHIBITS:

 

Exhibit A – Form of Assignment and Assumption

Exhibit B – Form of Opinion of
Borrower’s Counsel

Exhibit C – Form of Counterpart Agreement

Exhibit D – Form of Solvency
Certificate

Exhibit E
– Form of Note

Exhibit F
– Form of Lender Certificate

 

v

 

SENIOR
UNSECURED TERM CREDIT AGREEMENT dated as of July 15, 2008, among EXCO
OPERATING COMPANY, LP, as Borrower, CERTAIN SUBSIDIARIES OF BORROWER, as
Guarantors, the LENDERS party hereto, and JPMORGAN CHASE BANK, N.A., as
Administrative Agent.

 

The parties
hereto agree as follows:

 

Article I

 

Definitions

 

Section 1.01.          Defined
Terms.  As used in this Agreement,
the following terms have the meanings specified below:

 

“ABR”,
when used in reference to any Loan or Borrowing, refers to whether such Loan
is, or the Loans comprising such Borrowing are, bearing interest at a rate
determined by reference to the Alternate Base Rate. “Acquisition” means,
the acquisition by the Borrower or any Restricted Subsidiary, whether by
purchase, merger (and, in the case of a merger with any such Person, with such
Person being the surviving corporation) or otherwise, of all or substantially
all of the Equity Interest of, or the business, property or fixed assets of or
business line or unit or a division of, any other Person primarily engaged in
the business of producing oil or natural gas or the acquisition by the Borrower
or any Restricted Subsidiary of property or assets consisting of Oil and Gas
Interests. “Adjusted LIBO Rate” means, with respect to any Eurodollar
Borrowing for any Interest Period, an interest rate per annum equal to (a) the
LIBO Rate for such Interest Period multiplied by (b) the Statutory Reserve
Rate.

 

“Administrative
Agent” means JPMorgan Chase Bank, N.A. in its capacity as contractual
representative of the Lenders hereunder pursuant to Article X and not in
its individual capacity as a Lender, and any successor agent appointed pursuant
to Article X.

 

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

 

“Advance
Payment Contract” means any contract whereby any Credit Party either (a) receives
or becomes entitled to receive (either directly or indirectly) any payment (an “Advance
Payment”) to be applied toward payment of the purchase price of
Hydrocarbons produced or to be produced from Oil and Gas Interests owned by any
Credit Party and which Advance Payment is, or is to be, paid in advance of
actual delivery of such production to or for the account of the purchaser
regardless of such production, or (b) grants an option or right of refusal
to the purchaser to take delivery of such production in lieu of payment, and,
in either of the foregoing instances, the Advance Payment is, or is to be,
applied as payment in full for such production when sold and delivered or is,
or is to be, applied as payment for a portion only of the purchase price thereof
or of a percentage or share of such production; provided that  inclusion of the standard “take or pay”
provision in any gas sales or purchase contract or any other similar contract
shall not, in and of itself, constitute such contract as an Advance Payment
Contract for the purposes hereof.

 

 

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

 

“Agreement”
means this Senior Unsecured Term Credit Agreement, dated as of July 15,
2008, as it may be amended, restated, supplemented or otherwise modified from
time to time.

 

“Alternate
Base Rate” means, for any day, a rate per annum equal to the greater of (a) the
Prime Rate in effect on such day and (b) the Federal Funds Effective Rate
in effect on such day plus one-half of one percent (1⁄2 of 1%).  Any change in the Alternate Base Rate due to
a change in the Prime Rate or the Federal Funds Effective Rate shall be
effective from and including the effective date of such change in the Prime
Rate or the Federal Funds Effective Rate, respectively.

 

“Applicable
Percentage” means, with respect to any Lender at any time, the percentage
of the aggregate Commitments represented by such Lender’s Commitment at such
time or, from and after the Effective Date, of the aggregate outstanding Loans
represented by such Lender’s outstanding Loans. 
The initial amount of each Lender’s Applicable Percentage is as set forth
on Schedule 2.01.

 

“Applicable
Margin” means, for any day, (i) with respect to any ABR Loan, four and
three-quarters percent (4.75%)  and (i) with
respect to any Eurodollar Loan, six percent (6.00%).

 

“Approved
Counterparty” means, at any time and from time to time, (i) any Person
engaged in the business of writing Swap Agreements for commodity, interest rate
or currency risk that is acceptable to the Administrative Agent and has (or the
credit support provider of such Person has), at the time Borrower or any
Restricted Subsidiary enters into a Swap Agreement with such Person, a long
term senior unsecured debt credit rating of BBB+ or better from S&P or Baa1
or better from Moody’s and (ii) any Lender Counterparty.

 

“Approved
Fund” has the meaning assigned to such term in Section 11.04.

 

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

 

“Assignment
and Assumption” means an assignment and assumption entered into by a Lender
and an Eligible Assignee, and accepted by the Administrative Agent, in the form
of Exhibit A or any other form approved by the Administrative Agent.

 

“Availability
Period” has the meaning assigned to such term in Section 2.03.

 

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

 

“Board of
Directors” means (1) with respect to a corporation, the Board of
Directors of the corporation or any committee thereof duly authorized to act on
behalf of such

 

2

 

board; (2) with
respect to a partnership, the Board of Directors of the general partner of the
partnership; (3) with respect to a limited liability company, the managing
member or members or any controlling committee of managing members thereof; and
(4) with respect to any other Person, the board or committee of such
Person serving a similar function.

 

“Borrower”
means EXCO Operating Company, LP, a Delaware limited partnership, and its
successors and permitted assigns.

 

“Borrower
Materials” has the meaning assigned to such term in Section 6.01.

 

“Borrowing”
means Loans of the same Type, made, converted or continued on the same date
and, in the case of Eurodollar Loans, as to which a single Interest Period is
in effect.

 

“Borrowing
Request” means a request by the Borrower for a Borrowing in accordance with
Section 2.04.

 

“Business
Day” means any day that is not a Saturday, Sunday or other day on which
commercial banks in New York, New York or Dallas, Texas are authorized or
required by law to remain closed; provided that, when used in connection
with a Eurodollar Loan, the term “Business Day” shall also exclude any
day on which banks are not open for dealings in dollar deposits in the London
interbank market.

 

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

 

“Change in
Law” means (a) the adoption of any law, rule or regulation after
the date of this Agreement, (b) any change in any law, rule or
regulation or in the interpretation or application thereof by any Governmental
Authority after the date of this Agreement or (c) compliance by any Lender
(or, for purposes of Section 2.14(b), by any lending office of such Lender
or by such Lender’s holding company, if any) with any request, guideline or
directive (whether or not having the force of law) of any Governmental
Authority made or issued after the date of this Agreement.

 

“Change of
Control” means (a) the acquisition of greater than fifty percent (50%)
of the voting or economic interest in the General Partner by any Person other
than a wholly owned direct or indirect Subsidiary of EXCO; (b) the General
Partner shall cease to own and control, of record, beneficially and directly,
one hundred percent (100%) of the general partnership interest of the Borrower
or cease to be the sole managing partner of the Borrower; or (c) the
occurrence of a “Change of Control” as such term is defined in the EXCO Credit
Agreement.

 

“Charges”
has the meaning assigned to such term in Section 11.13.

 

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

 

3

 

“Commitment”
means, with respect to each Lender, the commitment of such Lender to make Loans
to the Borrower in the aggregate principal amount outstanding not to exceed the
amount set forth opposite such Lender’s name on Schedule 2.01, as such
commitment may be (a) reduced or increased from time to time pursuant to
assignments by or to such Lender pursuant to Section 11.04 and (b) increased
from time to time pursuant to Section 2.03.  The initial amount of each Lender’s
Commitment (which amount is such Lender’s Applicable Percentage of the aggregate
Commitments) is set forth in Schedule 2.01.  The initial aggregate amount of the
Commitments is $300,000,000.

 

“Consolidated
Current Assets” means, as of any date of determination, the total of (i) the
consolidated current assets of the Borrower and the Restricted Subsidiaries
determined in accordance with GAAP as of such date and calculated on a combined
basis, plus, all Unused Commitments (as defined in the Revolving Credit
Agreement) as of such date, (ii) less any non-cash assets required
to be included in consolidated current assets of the Borrower and the
Restricted Subsidiaries as a result of the application of FASB Statement 133 as
of such date.

 

“Consolidated
Current Liabilities” means, as of any date of determination, the total of (i) consolidated
current liabilities of the Borrower and the Restricted Subsidiaries, as
determined in accordance with GAAP as of such date, (ii) less
current maturities of the Revolving Loans, (iii) less any non-cash
obligations required to be included in consolidated current liabilities of the
Borrower and the Restricted Subsidiaries as a result of the application of FASB
Statement 133 as of such date.

 

“Consolidated
Current Ratio” means, as of any date of determination, the ratio of
Consolidated Current Assets to Consolidated Current Liabilities as of such
date.

 

“Consolidated
EBITDAX” means, with respect to the Borrower and its Restricted
Subsidiaries for any period, Consolidated Net Income for such period; plus,
without duplication and to the extent deducted in the calculation of
Consolidated Net Income for such period, the sum of (a) income or
franchise Taxes paid or accrued; (b) Consolidated Interest Expense; (c) amortization,
depletion and depreciation expense; (d) any non-cash losses or charges on
any Swap Agreement resulting from the requirements of FASB Statement 133 for
that period; (e) oil and gas exploration expenses (including all drilling,
completion, geological and geophysical costs) for such period; (f) losses
from sales or other dispositions of assets (other than Hydrocarbons produced in
the ordinary course of business) and other extraordinary or non-recurring
losses; (g) workover expenses for such period, (h) cash payments made
during such period as a result of the early termination of any Swap Agreement
(giving effect to any netting agreements), and (i) other non-cash charges
(excluding accruals for cash expenses made in the ordinary course of business);
minus, to the extent included in the calculation of Consolidated Net Income for
such period; (j) the sum of (1) any non-cash gains on any Swap
Agreements resulting from the requirements of FASB Statement 133 for that
period; (2) extraordinary or non-recurring gains; and (3) gains from
sales or other dispositions of assets (other than Hydrocarbons produced in the
ordinary course of business); provided that, with respect to the
determination of Borrower’s compliance with the leverage ratio set forth in Section 7.11(b) for
any period, Consolidated EBITDAX shall be adjusted to give effect, on a pro
forma basis, to any Acquisitions made during such period as if such
Acquisitions were made at the beginning of such period.

 

4

 

“Consolidated
Funded Indebtedness” means, as of any date and without duplication,
Indebtedness of the Borrower and the Restricted Subsidiaries of the type
described in clauses (a), (b), (c), (d), (e), (f), (g) or (h) of the
definition of Indebtedness, minus Surplus Cash.

 

“Consolidated
Interest Expense” means for any period, without duplication, the aggregate
of all interest paid or accrued by the Borrower and its Restricted
Subsidiaries, on a consolidated basis, in respect of Indebtedness of any such
Person, on a consolidated basis, including all interest, fees and costs payable
with respect to the obligations related to such Indebtedness (other than fees
and costs which may be capitalized as transaction costs in accordance with
GAAP) and the interest component of Capitalized Lease Obligations, all as
determined in accordance with GAAP.

 

“Consolidated
Net Income” means for any period, the consolidated net income (or loss) of
the Borrower and its Consolidated Subsidiaries, as applicable, determined on a
consolidated basis in accordance with GAAP; provided that there shall be
excluded (a) the income (or deficit) of any Person accrued prior to the
date it becomes a Consolidated Subsidiary of the Borrower, or is merged into or
consolidated with the Borrower or any of its Consolidated Subsidiaries, as
applicable, (b) the income (or deficit) of any Person in which any other
Person (other than the Borrower or any of its Restricted Subsidiaries) has an
Equity Interest, except to the extent of the amount of dividends or other
distributions actually paid to the Borrower or any of its Restricted
Subsidiaries during such period and (c) the undistributed earnings of any
Consolidated Subsidiary of the Borrower, to the extent that the declaration or
payment of dividends or similar distributions by such Consolidated Subsidiary
is not at the time permitted by the terms of any contractual obligation (other
than under any Loan Document) or by any law applicable to such Consolidated
Subsidiary.

 

“Consolidated
Subsidiaries” means, for any Person, any Subsidiary or other entity the
accounts of which would be consolidated with those of such Person in its
consolidated financial statements in accordance with GAAP.

 

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

 

“Counterpart
Agreement” means a Counterpart Agreement substantially in the form of Exhibit C
delivered by a Guarantor pursuant to Section 6.13.

 

“Credit
Parties” means collectively, Borrower, and each Guarantor and each
individually, a “Credit Party”.

 

“Crude Oil”
means all crude oil and condensate.

 

“Default”
means any event or condition which constitutes an Event of Default or which
upon notice, lapse of time or both would, unless cured or waived, become an
Event of Default.

 

5

 

“Disclosed
Matters” means the actions, suits and proceedings and the environmental
matters disclosed in Schedule 4.06.

 

“Disqualified
Stock” means any Equity Interest, which, by its terms (or by the terms of
any security into which it is convertible or for which it is exchangeable), or
upon the happening of any event, matures or is mandatorily redeemable, pursuant
to a sinking fund obligation or otherwise, or is redeemable at the sole option
of the holder thereof (other than solely as a result of a change in control or
asset sale), in whole or in part, on or prior to the Maturity Date.

 

“Dollars”
or “$” refers to lawful money of the United States of America.

 

“Domestic
Subsidiary” means, with respect to any Person, a subsidiary of such Person
that is incorporated or formed under the laws of the United States of America,
any state thereof or the District of Columbia.

 

“Effective
Date” means the date on which the conditions specified in Section 5.01
are satisfied (or waived in accordance with Section 11.02).

 

“Eligible Assignee”
means any Person that qualifies as an assignee pursuant to Section 11.04(b)(i);
provided that notwithstanding the foregoing, “Eligible Assignee” shall not
include the Borrower or any of the Borrower’s Affiliates or Subsidiaries.

 

“Environmental
Laws” means all laws, rules, regulations, codes, ordinances, orders,
decrees, judgments, injunctions, notices or binding agreements issued,
promulgated or entered into by any Governmental Authority, relating in any way
to the environment, preservation or reclamation of natural resources, the
management, release or threatened release of any Hazardous Material or to
health and safety matters.

 

“Environmental
Liability” means any liability, contingent or otherwise (including any
liability for damages, costs of environmental remediation, fines, penalties or
indemnities), of any Credit Party directly or indirectly resulting from or
based upon (a) violation of any Environmental Law, (b) the
generation, use, handling, transportation, storage, treatment or disposal of
any Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the
release or threatened release of any Hazardous Materials into the environment
or (e) any contract, agreement or other consensual arrangement pursuant to
which liability is assumed or imposed with respect to any of the foregoing.

 

“Equity
Interests” means shares of capital stock, partnership interests, membership
interests in a limited liability company, beneficial interests in a trust or
other equity ownership interests in a Person, and any warrants, options or
other rights entitling the holder thereof to purchase or acquire any such
equity interest.

 

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

 

“ERISA
Affiliate” means any trade or business (whether or not incorporated) that,
together with any Credit Party, is treated as a single employer under Section 414(b) or
(c) of the

 

6

 

Code or,
solely for purposes of Section 302 of ERISA and Section 412 of the
Code, is treated as a single employer under Section 414 of the Code.

 

“ERISA
Event” means (a) any “reportable event”, as defined in Section 4043
of ERISA or the regulations issued thereunder with respect to a Plan (other
than an event for which the thirty (30) day notice period is waived); (b) the
existence with respect to any Plan of an “accumulated funding deficiency” (as
defined in Section 412 of the Code or Section 302 of ERISA), whether
or not waived; (c) the filing pursuant to Section 412(d) of the
Code or Section 303(d) of ERISA of an application for a waiver of the
minimum funding standard with respect to any Plan; (d) the incurrence by
any Credit Party or any of its ERISA Affiliates of any liability under
Title IV of ERISA with respect to the termination of any Plan; (e) the
receipt by any Credit Party or any ERISA Affiliate from the PBGC or a plan
administrator of any notice relating to an intention to terminate any Plan or
Plans or to appoint a trustee to administer any Plan; (f) the incurrence
by any Credit Party or any of its ERISA Affiliates of any liability with
respect to the withdrawal or partial withdrawal from any Plan or Multiemployer
Plan; or (g) the receipt by any Credit Party or any ERISA Affiliate of any
notice, or the receipt by any Multiemployer Plan from any Credit Party or any
ERISA Affiliate of any notice, concerning the imposition of Withdrawal
Liability or a determination that a Multiemployer Plan is, or is expected to
be, insolvent or in reorganization, within the meaning of Title IV of
ERISA.

 

“Eurodollar”,
when used in reference to any Loan or Borrowing, refers to whether such Loan
is, or the Loans comprising such Borrowing are, bearing interest at a rate
determined by reference to the Adjusted LIBO Rate.

 

“Event of
Default” has the meaning assigned to such term in Article IX.

 

“Excluded
Taxes” means, with respect to the Administrative Agent, any Lender or any
other recipient of any payment to be made by or on account of any obligation of
the Borrower hereunder, (a) income or franchise taxes imposed on (or
measured by) its net income  by the
United States of America, or by the jurisdiction under the laws of which such
recipient is organized or in which its principal office is located or, in the
case of any Lender, in which its applicable lending office is located, (b) any
branch profits taxes imposed by the United States of America or any similar tax
imposed by any other jurisdiction in which the Borrower is located and (c) in
the case of a Foreign Lender (other than an assignee pursuant to a request by
the Borrower under Section 2.18(b)), any withholding tax that is imposed
on amounts payable to such Foreign Lender at the time such Foreign Lender
becomes a party to this Agreement (or designates a new lending office) or is
attributable to such Foreign Lender’s failure to comply with Section 2.16(e),
except to the extent that such Foreign Lender (or its assignor, if any) was
entitled, at the time of designation of a new lending office (or assignment),
to receive additional amounts from the Borrower with respect to such
withholding tax pursuant to Section 2.16(a).

 

“EXCO”
means EXCO Resources, Inc., a Texas corporation, and its successors and
assigns.

 

“EXCO
Credit Agreement” means that certain Second Amended and Restated Credit
Agreement, dated as of May 2, 2007, among EXCO, as borrower, certain
subsidiaries of EXCO, as guarantors, the financial institutions from time to
time a party thereto, as lenders and

 

7

 

JPMorgan Chase
Bank, N.A., as administrative agent, as amended, modified, supplemented or
restated from time to time.

 

“Existing
Swap Agreements” means any Swap Agreement between any Credit Party and any
Approved Counterparty in effect on the Effective Date.

 

“FASB”
means Financial Accounting Standards Board.

 

“Federal
Funds Effective Rate” means, for any day, the weighted average (rounded
upwards, if necessary, to the next 1/100th of 1%) of the rates on
overnight Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers, as published on the next succeeding Business
Day by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day that is a Business Day, the average (rounded upwards, if
necessary, to the next 1/100th of 1%) of the quotations for such day
for such transactions received by the Administrative Agent from three Federal
funds brokers of recognized standing selected by it.

 

“Foreign
Lender” means any Lender that is organized under the laws of a jurisdiction
other than that in which any Credit Party is located.  For purposes of this definition, the United
States of America, each State thereof and the District of Columbia shall be
deemed to constitute a single jurisdiction.

 

“GAAP”
means generally accepted accounting principles in the United States of America.

 

“General
Partner” means EXCO Partners OLP GP, LLC, a Delaware limited liability
company, and its successors and permitted assigns.

 

“Governmental
Authority” means the government of the United States of America, any other
nation or any political subdivision thereof, whether state or local, and any
agency, authority, instrumentality, regulatory body, court, central bank or
other entity properly exercising executive, legislative, judicial, taxing,
regulatory or administrative powers or functions of or pertaining to
government.

 

“Guarantee”
of or by any Person (in this definition, the “guarantor”) means any
obligation, contingent or otherwise, of the guarantor guaranteeing or having
the economic effect of guaranteeing any Indebtedness or other obligation of any
other Person (the “primary obligor”) in any manner, whether directly or
indirectly, and including any obligation of the guarantor, direct or indirect, (a) to
purchase or pay (or advance or supply funds for the purchase or payment of)
such Indebtedness or other obligation or to purchase (or to advance or supply
funds for the purchase of) any security for the payment thereof, (b) to
purchase or lease property, securities or services for the purpose of assuring
the owner of such Indebtedness or other obligation of the payment thereof, (c) to
maintain working capital, equity capital or any other financial statement
condition or liquidity of the primary obligor so as to enable the primary obligor
to pay such Indebtedness or other obligation or (d) as an account party in
respect of any letter of credit or letter of guaranty issued to support such
Indebtedness or obligation; provided, that the term Guarantee shall not
include endorsements for collection or deposit in the ordinary course of
business.

 

8

 

“Guaranteed
Liabilities” has the meaning assigned to such term in Section 8.01.

 

“Guarantor”
means each Restricted Subsidiary that is a party hereto or hereafter executes
and delivers to the Administrative Agent and the Lenders, a Counterpart
Agreement pursuant to Section 6.13 or otherwise.

 

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

 

“Hydrocarbons”
means all Crude Oil and Natural Gas produced from or attributable to the Oil
and Gas Interests of the Credit Parties.

 

“Increase
Date” has the meaning assigned to such term in Section 2.03.

 

“Indebtedness”
of any Person means, without duplication, (a) all obligations of such
Person for borrowed money or with respect to deposits or advances of any kind, (b) all
obligations of such Person evidenced by bonds, debentures, notes or similar
instruments, (c) all obligations of such Person upon which interest
charges are paid, (d) all obligations of such Person under conditional
sale or other title retention agreements relating to property acquired by such
Person, (e) all obligations of such Person in respect of the deferred
purchase price of property or services (excluding current accounts payable
incurred in the ordinary course of business), (f) all Indebtedness of
others secured by (or for which the holder of such Indebtedness has an existing
right, contingent or otherwise, to be secured by) any Lien on property owned or
acquired by such Person, whether or not the Indebtedness secured thereby has
been assumed, (g) all Guarantees by such Person of Indebtedness of others,
(h) all Capital Lease Obligations of such Person, (i) all
obligations, contingent or otherwise, of such Person as an account party in
respect of letters of credit and letters of guaranty and (j) all
obligations, contingent or otherwise, of such Person in respect of bankers’
acceptances.  The Indebtedness of any
Person shall include the Indebtedness of any other entity (including any
partnership in which such Person is a general partner) to the extent such
Person is liable therefor as a result of such Person’s ownership interest in or
other relationship with such entity, except to the extent the terms of such
Indebtedness provide that such Person is not liable therefor.

 

“Indemnified
Taxes” means Taxes other than Excluded Taxes.

 

“Indemnitee”
has the meaning assigned to such term in Section 11.03.

 

“Information”
has the meaning assigned to such term in Section 11.12.

 

“Initial
Loan” has the meaning assigned to such term in Section 2.01.

 

“Interest
Election Request” means a request by the Borrower to convert or continue a
Borrowing in accordance with Section 2.07.

 

9

 

“Interest
Payment Date” means (a) with respect to any ABR Loan, the last day of
each calendar quarter and (b) with respect to any Eurodollar Loan, the
last day of the Interest Period applicable to the Borrowing of which such Loan
is a part.

 

“Interest
Period” means with respect to any Eurodollar Borrowing, the period
commencing on the date of such Borrowing and ending on the numerically
corresponding day in the calendar month that is one, two or three months
thereafter, as the Borrower may elect; provided, that (i) if any
Interest Period would end on a day other than a Business Day, such Interest
Period shall be extended to the next succeeding Business Day unless such next
succeeding Business Day would fall in the next calendar month, in which case
such Interest Period shall end on the next preceding Business Day and (ii) any
Interest Period that commences on the last Business Day of a calendar month (or
on a day for which there is no numerically corresponding day in the last
calendar month of such Interest Period) shall end on the last Business Day of
the last calendar month of such Interest Period.  For purposes hereof, the date of a Borrowing
initially shall be the date on which such Borrowing is made.

 

“Lender
Certificate” has the meaning assigned to such term in Section 2.03.

 

“Lender
Counterparty” has the meaning assigned to such term in the Revolving Credit
Agreement.

 

“Lenders”
means the Persons listed on Schedule 2.01 and any other Person that shall
have become a party hereto pursuant to an Assignment and Assumption or a Lender
Certificate, other than any such Person that ceases to be a party hereto
pursuant to an Assignment and Assumption.

 

“LIBO Rate”
means, with respect to any Eurodollar Borrowing for any Interest Period, the
greater of (i) the rate appearing on Page 3750 of the Moneyline
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 interest rates applicable to dollar deposits in the
London interbank market) at approximately 11:00 a.m., London time, two (2) Business
Days prior to the commencement of such Interest Period, as the rate for dollar
deposits with a maturity comparable to such Interest Period and (ii) three
and one-half percent (3.50%) per annum. 
In the event that such rate described in clause (i) above is not
available at such time for any reason, then the “LIBO Rate” with respect
to such Eurodollar Borrowing for such Interest Period shall be the rate at
which dollar deposits of $5,000,000 and for a maturity comparable to such
Interest Period are offered by the principal London office of the
Administrative Agent in immediately available funds in the London interbank
market at approximately 11:00 a.m., London time, two (2) Business
Days prior to the commencement of such Interest Period.

 

“Lien”
means, with respect to any asset, (a) any mortgage, deed of trust, lien,
pledge, hypothecation, encumbrance, charge or security interest in, on or of
such asset, (b) the interest of a vendor or a lessor under any conditional
sale agreement, capital lease or title retention agreement (or any financing
lease having substantially the same economic effect as any

 

10

 

of the
foregoing) relating to such asset and (c) in the case of securities, any
purchase option, call or similar right of a third party with respect to such
securities.

 

“Loan
Documents” means this Agreement, any promissory notes executed in
connection herewith, the Fee Letter and any other agreements, documents,
certificates and instruments executed in connection with this Agreement.

 

“Loan
Increase” has the meaning assigned to such term in Section 2.03.

 

“Loans”
means each of the Initial Loans and each of the additional loans made by
certain Lenders to the Borrower pursuant to any Loan Increase.

 

“Material
Adverse Effect” means a material adverse effect on (a) the assets or
properties, financial condition, businesses or operations of the Borrower and
the Restricted Subsidiaries taken as a whole, (b) the ability of any
Credit Party to carry out its business as of the date of this Agreement or as
proposed at the date of this Agreement to be conducted, (c) the ability of
any Credit Party to perform fully and on a timely basis its respective
obligations under any of the Loan Documents to which it is a party, or (d) the
validity or enforceability of any of the Loan Documents or the rights and
remedies of the Administrative Agent or the Lenders under this Agreement and
the other Loan Documents.

 

“Material
Domestic Subsidiary” means any Domestic Subsidiary that owns or holds
assets, properties or interests (including Oil and Gas Interests) with an
aggregate fair market value, on a consolidated basis, greater than five percent
(5%) of the aggregate fair market value of all of the assets, properties and
interests (including Oil and Gas Interests) of the Borrower and the Restricted
Subsidiaries, on a consolidated basis.

 

“Material
Indebtedness” means Indebtedness permitted under Section 7.01(h) and
any other Indebtedness (other than the Loans), or obligations in respect of one
or more Swap Agreements, of the Borrower or any one or more of the Restricted
Subsidiaries in an aggregate principal amount exceeding $50,000,000.  For purposes of determining Material
Indebtedness, the “principal amount” of the obligations of the Borrower or any
Guarantor in respect of any Swap Agreement at any time shall be the maximum
aggregate amount (giving effect to any netting agreements) that the Borrower or
such Guarantor would be required to pay if such Swap Agreement were terminated
at such time.

 

“Maturity
Date” means December 15, 2008.

 

“Maximum
Liability” has the meaning assigned to such term in Section 8.10.

 

“Maximum
Rate” has the meaning assigned to such term in Section 11.13.

 

“Moody’s”
means Moody’s Investors Service, Inc.

 

“Multiemployer
Plan” means a multiemployer plan as defined in Section 4001(a)(3) of
ERISA.

 

11

 

“Natural
Gas” means all natural gas, distillate or sulphur, natural gas liquids and
all products recovered in the processing of natural gas (other than condensate)
including, without limitation, natural gasoline, coalbed methane gas,
casinghead gas, iso-butane, normal butane, propane and ethane (including such
methane allowable in commercial ethane).

 

“Net Cash
Proceeds” means, with respect to any sale, transfer, assignment or
disposition of any assets by the Borrower or any Restricted Subsidiary,
including any Oil and Gas Interests, the excess, if any, of (a) the sum of
cash and cash equivalents received in connection with such sale, but only as
and when so received, over (b) the sum of (i) the principal amount of
any Indebtedness that is secured by such asset and that is required to be
repaid in connection with the sale thereof (other than the Revolving Loans), (ii) the
out-of-pocket expenses incurred by the Borrower or such Restricted Subsidiary
in connection with such sale, (iii) all legal, title and recording tax
expense and all federal, state, provincial, foreign and local taxes required to
be accrued as a liability under GAAP as a consequence of such sale, (iv) all
distributions and other payments required to be made to minority interest
holders in Restricted Subsidiaries as a result of such sale, (v) the
deduction of appropriate amounts provided by the seller as a reserve, in
accordance with GAAP, against any liabilities associated with the property or
other assets disposed of in such sale and retained by the Borrower or any
Restricted Subsidiary after such sale, (vi) cash payments made to satisfy
obligations resulting from early terminations of Swap Agreements in connection
with or as a result of any such sale or other disposition of Oil and Gas
Interests, (vii) the principal amount of the Revolving Loans that the
Borrower is required to prepay as a result of such sale, transfer, assignment
or disposition and (viii) any portion of the purchase price from such sale
placed in escrow, whether as a reserve for adjustment of the purchase price,
for satisfaction of indemnities in respect of such sale or otherwise in
connection with such sale; provided  however, that upon the
termination of that escrow, Net Cash Proceeds will be increased by any portion
of funds in the escrow that are released to the Borrower or any Restricted
Subsidiary.

 

“Net Working
Capital” means, on any date of determination, the sum of (a) Consolidated
Current Assets as of such date (calculated without including Unused Commitments
(as defined in the Revolving Credit Agreement) as of such date) minus (b) Consolidated
Current Liabilities as of such date.

 

“New Lender”
has the meaning assigned to such term in Section 2.03.

 

“Non-Consenting
Lender” has the meaning assigned to such term in Section 2.18(c).

 

“Obligations”
means any and all obligations of every nature, contingent or otherwise, whether
now existing or hereafter arising, of any Credit Party from time to time owed
to the Administrative Agent, the Lenders or any of them arising under or in
connection with any Loan Document, whether for principal, interest, funding
indemnification amounts, fees, expenses, indemnification or otherwise.

 

“Off-Balance Sheet Liability” of a Person means (i) any
repurchase obligation or liability of such Person with respect to accounts or
notes receivable sold by such Person, (ii) any liability under any Sale
and Leaseback Transaction which is not a Capital Lease Obligation,

 

12

 

(iii) any liability under any so-called “synthetic lease”
transaction entered into by such Person, (iv) any Advance Payment
Contract, or (v) any obligation arising with respect to any other
transaction which is the functional equivalent of or takes the place of
borrowing but which does not constitute a liability on the balance sheets of
such Person, but excluding from the foregoing clauses (iii) through (v) operating
leases and usual and customary oil, gas and mineral leases.

 

“Oil and
Gas Interest(s)” means: (a) direct and indirect interests in and
rights with respect to oil, gas, mineral and related properties and assets of any
kind and nature, direct or indirect, including, without limitation, wellbore
interests, working, royalty and overriding royalty interests, mineral
interests, leasehold interests, production payments, operating rights, net
profits interests, other non-working interests, contractual interests,
non-operating interests and rights in any pooled, unitized or communitized
acreage by virtue of such interest being a part thereof; (b) interests in
and rights with respect to Hydrocarbons other minerals or revenues therefrom
and contracts and agreements in connection therewith and claims and rights
thereto (including oil and gas leases, operating agreements, unitization,
communitization and pooling agreements and orders, division orders, transfer
orders, mineral deeds, royalty deeds, oil and gas sales, exchange and
processing contracts and agreements and, in each case, interests thereunder),
and surface interests, fee interests, reversionary interests, reservations and
concessions related to any of the foregoing; (c) easements, rights-of-way,
licenses, permits, leases, and other interests associated with, appurtenant to,
or necessary for the operation of any of the foregoing; (d) interests in
oil, gas, water, disposal and injection wells, equipment and machinery (including
well equipment and machinery), oil and gas production, gathering, transmission,
compression, treating, processing and storage facilities (including tanks, tank
batteries, pipelines and gathering systems), pumps, water plants, electric
plants, gasoline and gas processing plants, refineries and other tangible or
intangible, movable or immovable, real or personal property and fixtures
located on, associated with, appurtenant to, or necessary for the operation of
any of the foregoing; and (e) all seismic, geological, geophysical and
engineering records, data, information, maps, licenses and interpretations.

 

“Organizational
Documents” means (a) with respect to any corporation, its certificate
or articles of incorporation or organization, as amended, and its by-laws, as
amended, (b) with respect to any limited partnership, its certificate of
limited partnership, as amended, and its partnership agreement, as amended, (c) with
respect to any general partnership, its partnership agreement, as amended, and (d) with
respect to any limited liability company, its certificate of formation or
articles of organization, as amended, and its limited liability company
agreement or operating agreement, as amended.

 

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

 

“Participant”
has the meaning assigned to such term in Section 11.04.

 

“Payment
Currency” has the meaning assigned to such term in Section 8.07.

 

13

 

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

 

“Permitted
Encumbrances” means:

 

(a)                                  Liens
imposed by law for Taxes that are not yet due or are being contested in
compliance with Section 6.04;

 

(b)                                 carriers’,
warehousemen’s, mechanics’, materialmen’s, repairmen’s and other like Liens
imposed by law, and contractual Liens granted to operators and non-operators
under oil and gas operating agreements, in each case, arising in the ordinary
course of business or incident to the exploration, development, operation and
maintenance of Oil and Gas Interests and securing obligations that are not
overdue by more than thirty (30) days or are being contested in compliance with
Section 6.04;

 

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

 

(d)                                 deposits
to secure the performance of bids, trade contracts, leases, statutory
obligations, surety and appeal bonds, performance bonds and other obligations
of a like nature, in each case in the ordinary course of business;

 

(e)                                  judgment
liens in respect of judgments that do not constitute an Event of Default under
clause (k) of Article IX;

 

(f)                                    easements,
zoning restrictions, rights-of-way, servitudes, permits, surface leases, and
similar encumbrances on real property imposed by law or arising in the ordinary
course of business that do not secure any monetary obligations and do not
materially detract from the value of the affected property or interfere with
the ordinary conduct of business of any Credit Party;

 

(g)                                 royalties,
overriding royalties, reversionary interests and similar burdens with respect
to the Oil and Gas Interests owned by the Borrower or such Restricted
Subsidiary, as the case may be, if the net cumulative effect of such burdens
does not operate to deprive the Borrower or any Restricted Subsidiary of any
material right in respect of its assets or properties (except for rights
customarily granted with respect to such interests);

 

(h)                                 Liens
arising from Uniform Commercial Code financing statement filings regarding
operating leases entered into by the Borrower or any Restricted Subsidiary in
the ordinary course of business covering the property under the lease; and

 

(i)                                     preferential
rights to purchase, and provisions requiring a third party’s consent prior to
assignment and similar restraints on alienation, in each case, granted pursuant
to an oil and gas operating agreement and arising in the ordinary course of
business or incident to the exploration, development, operation and maintenance
of Oil and Gas Interests; provided such right, requirement or restraint does
not material affect the value of such Oil and Gas Interests;

 

14

 

provided
that the term “Permitted Encumbrances” shall not include any Lien securing
Indebtedness (other than contractual Liens described in the foregoing clause (b) granted
to operators and non-operators under oil and gas operating agreements to the
extent the obligations secured by such Liens constitute Indebtedness).

 

“Permitted
Investments” means:

 

(a)                                  U.S.
Government Securities;

 

(b)                                 investments
in demand and time deposit accounts, certificates of deposit and money market
deposits maturing within one hundred eighty (180) days of the date of
acquisition thereof issued by a bank or trust company which is organized under
the laws of the United States of America, any State thereof or any foreign
country recognized by the United States of America, and which bank or trust company
has capital, surplus and undivided profits aggregating in excess of $50,000,000
(or the foreign currency equivalent thereof) and has outstanding debt which is
rated “A” (or such similar equivalent rating) or higher by at least one
nationally recognized statistical rating organization (as defined in Rule 436
under the Securities Act of 1933, as amended) or any money-market fund
sponsored by a registered broker dealer or mutual fund distributor;

 

(c)                                  investments
in deposits available for withdrawal on demand with any commercial bank that is
organized under the laws of any country in which the Borrower or any Restricted
Subsidiary maintains an office or is engaged in the oil and gas business; provided,
however, that (i) all such deposits have been made in such accounts
in the ordinary course of business and (ii) such deposits do not at any
one time exceed $10,000,000 in the aggregate;

 

(d)                                 repurchase
obligations with a term of not more than thirty (30) days for underlying
securities of the types described in clause (a) above entered into with a
bank meeting the qualifications described in clause (b) above;

 

(e)                                  investments
in commercial paper, maturing not more than ninety (90) days after the date of
acquisition, issued by a corporation (other than an Affiliate or the Borrower)
organized and in existence under the laws of the United States of America or
any foreign country recognized by the United States of America with a rating at
the time as of which any investment therein is made of “P-1” (or higher)
according to Moody’s or “A-l” (or higher) according to S&P;

 

(f)                                    investments
in securities with maturities of six months or less from the date of
acquisition issued or fully guaranteed by any state, commonwealth or territory
of the United States of America, or by any political subdivision or taxing
authority thereof, and rated at least “A” by S&P or “A” by Moody’s; and

 

(g)                                 investments
in money market funds that invest substantially all their assets in securities
of the types described in clauses (a) through (f) above

 

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

 

15

 

“Plan”
means any employee pension benefit plan (other than a Multiemployer Plan)
subject to the provisions of Title IV of ERISA or Section 412 of the
Code or Section 302 of ERISA, and in respect of which any Credit Party or
any ERISA Affiliate is (or, if such plan were terminated, would under Section 4069
of ERISA be deemed to be) an “employer” as defined in Section 3(5) of
ERISA.

 

“Platform”
has the meaning assigned to such term in Section 6.01.

 

“Prime Rate”
means the rate of interest per annum publicly announced from time to time by
JPMorgan Chase Bank, N.A. as its prime rate in effect at its principal office
in New York City, each change in the Prime Rate shall be effective from and
including the date such change is publicly announced as being effective.  THE PRIME RATE IS A REFERENCE RATE AND MAY NOT
BE JPMORGAN CHASE BANK N.A.’S LOWEST RATE.

 

“Projections”
means the Borrower’s forecasted (a) balance sheets, (b) profit and
loss statements, and (c) cash flow statements, all prepared on a basis
consistent with the historical financial statements described in Section 4.04
and after giving effect to the Transactions, together with appropriate
supporting details and a statement of underlying assumptions, in each case in
form and substance satisfactory to the Lenders and for the period from the
Effective Date through December 31, 2012.

 

“Public
Lender” has the meaning assigned to such term in Section 6.01.

 

“Register”
has the meaning assigned to such term in Section 11.04.

 

“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.

 

“Required
Lenders” means, at any time, Lenders having more than 50% of the aggregate
unpaid principal amount of the Loans then outstanding.

 

“Responsible
Officer” means the chief executive officer, president, vice president,
chief financial officer, principal accounting officer, treasurer or assistant
treasurer of a Credit Party.  Any document
delivered hereunder that is signed by a Responsible Officer of a Credit Party
shall be conclusively presumed to have been authorized by all necessary
corporate, partnership and/or other action on the part of such Credit Party and
such Responsible Officer shall be conclusively presumed to have acted on behalf
of such Credit Party.

 

“Restricted
Payment” means any dividend or other distribution (whether in cash,
securities or other property) with respect to any Equity Interests in any
Credit Party, or any payment (whether in cash, securities or other property),
including any sinking fund or similar deposit, on account of the purchase,
redemption, retirement, acquisition, cancellation or termination of any such
Equity Interests in any Credit Party or any option, warrant or other right to
acquire any such Equity Interests in any Credit Party.

 

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

 

16

 

“Revolving
Agent” means JPMorgan Chase Bank, N.A. in its capacity as contractual
representative of the financial institutions and other Persons from time to
time a party to the Revolving Facility and any successor agent appointed
pursuant to the terms of the Revolving Facility Documents.

 

“Revolving
Credit Agreement” means that certain Amended and Restated Credit Agreement
dated as of March 30, 2007, by and among Borrower, certain Subsidiaries of
Borrower, the lenders from time to time party thereto and JPMorgan Chase Bank,
N.A., as administrative agent, as the same may be amended, restated,
supplemented or otherwise modified from time to time.

 

“Revolving
Facility” means the revolving loan facility evidenced by the Revolving
Facility Documents.

 

“Revolving
Facility Documents” means the Revolving Credit Agreement and any promissory
notes executed in connection therewith, security instruments and any other
agreements, documents and certificates executed in connection with such
Revolving Credit Agreement, as the same may be amended, modified, supplemented
or restated from time to time.

 

“Revolving
Loans” means the revolving loans made under the Revolving Facility.

 

“S&P”
means Standard & Poor’s Ratings Group, a division of The McGraw Hill
Corporation.

 

“Sale and
Leaseback Transaction” means any sale or other transfer of any property by
any Person with the intent to lease such property as lessee.

 

“Statutory
Reserve Rate” means a fraction (expressed as a decimal), the numerator of
which is the number one and the denominator of which is the number one minus
the aggregate of the maximum reserve percentages (including any marginal,
special, emergency or supplemental reserves) expressed as a decimal established
by the Board to which the Administrative Agent is subject for eurocurrency
funding (currently referred to as “Eurocurrency Liabilities” in
Regulation D of the Board).  Such
reserve percentages shall include those imposed pursuant to such
Regulation D.  Eurodollar Loans
shall be deemed to constitute eurocurrency funding and to be subject to such
reserve requirements without benefit of or credit for proration, exemptions or
offsets that may be available from time to time to any Lender under such
Regulation D or any comparable regulation. 
The Statutory Reserve Rate shall be adjusted automatically on and as of
the effective date of any change in any reserve percentage.

 

“Subsidiary”
means, with respect to any Person (the “parent”) at any date, any
corporation, limited liability company, partnership, association or other
entity the accounts of which would be consolidated with those of the parent in
the parent’s consolidated financial statements if such financial statements
were prepared in accordance with GAAP as of such date, as well as any other
corporation, limited liability company, partnership, association or other
entity (a) of which securities or other ownership interests representing
more than fifty percent (50%) of the equity or more than fifty percent (50%) of
the ordinary voting power or, in the case of a partnership, more than fifty
percent (50%) of the general partnership interests are, as of such date, owned,
controlled or held, or (b) that is, as of such date, otherwise Controlled,
by the parent

 

17

 

or one or more
subsidiaries of the parent or by the parent and one or more subsidiaries of the
parent. Unless the context otherwise clearly requires, references herein to a “Subsidiary”
refer to a Subsidiary of the Borrower.

 

“Surplus
Cash” means the lesser of (i) cash and cash equivalents of the
Borrower and its Restricted Subsidiaries, on a consolidated basis that
constitute Permitted Investments and (ii) the amount by which Net Working
Capital exceeds zero ($0.00).

 

“Swap
Agreement” means any agreement with
respect to any swap, forward, future or derivative transaction or option or
similar agreement involving, or settled by reference to, one or more rates,
currencies, commodities, equity or debt instruments or securities, or economic,
financial or pricing indices or measures of economic, financial or pricing risk
or value or any similar transaction or any combination of these transactions; provided
that no phantom stock or similar plan providing for payments only on
account of services provided by current or former directors, officers, employees
or consultants of the Credit Parties shall be a Swap Agreement.

 

“Taxes” means any and all present or future taxes, levies,
imposts, duties, deductions, charges or withholdings imposed by any
Governmental Authority.

 

“Transactions”
means the (i) the execution, delivery and performance by the Credit
Parties of this Agreement and the Loan Documents, (ii) the borrowing of
Loans on the Effective Date, and (iii) the use of the proceeds thereof.

 

“Type”,
when used in reference to any Loan or Borrowing, refers to whether the rate of
interest on such Loan, or on the Loans comprising such Borrowing, is determined
by reference to the Adjusted LIBO Rate or the Alternate Base Rate.

 

“Unrestricted
Subsidiary” means (a) any Subsidiary that at the time of determination
shall be designated an Unrestricted Subsidiary by the Board of Directors of the
Borrower in the manner provided below and (b) any Subsidiary of an
Unrestricted Subsidiary. The Board of Directors of the Borrower may designate
any Subsidiary (including any newly acquired or newly formed Subsidiary) to be
an Unrestricted Subsidiary unless such Subsidiary or any of its Subsidiaries is
a Material Domestic Subsidiary.

 

“U.S.
Government Securities” means direct obligations of, or obligations the
principal of and interest on which are unconditionally guaranteed by, the
United States of America (or by any agency thereof to the extent such
obligations are backed by the full faith and credit of the United States of
America), in each case maturing within one year from the date of acquisition
thereof.

 

“Withdrawal
Liability” means liability to a Multiemployer Plan as a result of a
complete or partial withdrawal from such Multiemployer Plan, as such terms are
defined in Part I of Subtitle E of Title IV of ERISA.

 

Section 1.02.                             Types
of Loans and Borrowings.  For
purposes of this Agreement, Loans may be classified and referred to by Type (e.g.,
a “Eurodollar Loan” or an “ABR Loan”) and

 

18

 

Borrowings
also may be classified and referred to by Type (e.g., a “Eurodollar
Borrowing” or an “ABR Borrowing”).

 

Section 1.03.                             Terms
Generally.  The definitions of terms
herein shall apply equally to the singular and plural forms of the terms
defined.  Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms.  The words “include”, “includes”
and “including” shall be deemed to be followed by the phrase “without
limitation”.  The word “will” shall be
construed to have the same meaning and effect as the word “shall”.  Unless the context requires otherwise (a) any
definition of or reference to any agreement, instrument or other document
herein shall be construed as referring to such agreement, instrument or other
document as from time to time amended, supplemented or otherwise modified
(subject to any restrictions on such amendments, supplements or modifications
set forth herein), (b) any reference herein to any Person shall be
construed to include such Person’s successors and assigns, (c) the words “herein”,
“hereof” and “hereunder”, and words of similar import, shall be construed to
refer to this Agreement in its entirety and not to any particular provision
hereof, (d) all references herein to Articles, Sections, Exhibits and
Schedules shall be construed to refer to Articles and Sections of, and Exhibits
and Schedules to, this Agreement and (e) the words “asset” and “property”
shall be construed to have the same meaning and effect and to refer to any and
all tangible and intangible assets and properties, including cash, securities,
accounts and contract rights.

 

Section 1.04.                             Accounting
Terms; GAAP.  Except as otherwise
expressly provided herein, all terms of an accounting or financial nature shall
be construed in accordance with GAAP, as in effect from time to time; provided
that, if the Borrower notifies the Administrative Agent that the Borrower
request an amendment to any provision hereof to eliminate the effect of any
change occurring after the date hereof in GAAP or in the application thereof on
the operation of such provision (or if the Administrative Agent notifies the
Borrower that the Required Lenders request an amendment to any provision hereof
for such purpose), regardless of whether any such notice is given before or
after such change in GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until such notice shall have
been withdrawn or such provision amended in accordance herewith.

 

Section 1.05.                             Oil
and Gas Definitions.  For purposes of
this Agreement, the terms “proved or proven reserves,” “proved developed
reserves,” “proved or proven undeveloped reserves,” “proved or proven developed
nonproducing reserves” and “proved or proven developed producing reserves,”
have the meaning given such terms from time to time and at the time in question
by the Society of Petroleum Engineers of the American Institute of Mining
Engineers.

 

Section 1.06.                             Time
of Day.  Unless otherwise specified,
all references to times of day shall be references to Central time (daylight or
standard, as applicable).

 

19

 

Article II

 

The Credits

 

Section 2.01.                             Commitments.  Subject to the terms and conditions set forth
herein, each Lender agrees to make a Loan to the Borrower on the Effective Date
(each an “Initial Loan” and collectively the “Initial Loans”) in
an aggregate principal amount not to exceed the amount of the Commitment of
such Lender.  The Loans may from time to
time be Eurodollar Loans or ABR Loans, as determined by the Borrower and
notified to the Administrative Agent in accordance with Sections 2.04 and 2.07.  Amounts of Loans repaid or prepaid may not be
reborrowed.

 

Section 2.02.                             Repayment
of Loans.  The Borrower shall repay
the aggregate outstanding principal balance of the Loans on the Maturity Date.

 

Section 2.03.                             Increases
in the Commitments.  So long as no
Default has occurred and is continuing or would arise as a result thereof, the
Borrower may request from time to time and in any event on no more than four occasions
during the period after the Effective Date to and including October 15,
2008 (the “Availability Period”), an increase in the Commitments (each a
“Loan Increase”); provided, however, that (A) the aggregate
principal amount of all such Loan Increases shall not exceed $200,000,000 and (B) each
such Loan Increase shall be in an amount not less than $50,000,000 and integral
multiples of $5,000,000 in excess thereof. 
Each Lender shall have the option, but no Lender shall have any
obligation, to increase its Commitment hereunder in connection with any Loan
Increase pursuant to this Section.  The
Administrative Agent and the Borrower may solicit new commitments from any
Person (other than the Borrower or any of the Borrower’s Affiliates or
Subsidiaries) that are not existing Lenders under this Agreement (each a “New
Lender”).  Each Lender or New Lender
may, in its sole discretion, commit to participate in such Loan Increase by forwarding
its commitment therefor to the Administrative Agent.  The Administrative Agent, upon receipt of written
commitments from such Lenders and New Lenders, shall promptly notify the
Borrower of such commitments and the Borrower shall allocate, in its sole
discretion, to each such Lender or New Lender commitments with respect to such
Loan Increase not to exceed the amount of written commitments received from
such Lender or New Lender.  Each Loan
Increase shall become effective on a date agreed by the Borrower and the
Administrative Agent (each such date an “Increase Date”); provided that (x) such
Lender and/or New Lender shall have provided the Administrative Agent and the
Borrower with a duly executed certificate substantially in the form of Exhibit F
hereto (a “Lender Certificate”) (y) the Borrower shall have paid to
the Administrative Agent, for the benefit of the New Lenders and any existing
Lender increasing its Commitment, any and all fees payable in the amounts and
at the times separately agreed upon between Borrower and the Administrative
Agent and (z) the Administrative Agent shall have received such other
agreements, certificates, instruments and documents as the Administrative Agent
may reasonably request in connections with such Loan Increase, and all such
documents shall be in form and substance satisfactory to the Administrative
Agent.  On each such Increase Date, (a) the
Commitment of each existing Lender participating in such Loan Increase shall
automatically increase by, and the Commitment of each New Lender shall be, the
amount of such Loan Increase allocated to such existing Lender or New Lender,
as the case may be, by the Borrower pursuant to this Section 2.02, (b) each
Lender and/or New Lender who has elected, in its sole discretion, to
participate in such Loan Increase shall make Loans to the Borrower in an
aggregate principal amount not to exceed (i) for existing Lenders, the
amount of any increase in such Lender’s Commitment and (ii) for New
Lenders, the amount of such New

 

20

 

Lender’s Commitment, (c) the Register
shall be amended to add the Commitment of each New Lender or to reflect the
increase in the Commitment of any existing Lender, and the Applicable
Percentages of the Lenders shall be adjusted accordingly to reflect each New
Lender or the increase in the Commitment of an existing Lender, and (d) each
New Lender shall be deemed to be a party in all respects to this Agreement and
any other Loan Document to which the Lenders are a party.

 

Section 2.04.                             Requests
for Borrowings.  To request that the
Lenders make Loans on the Effective Date and on any Increase Date, the Borrower
shall notify the Administrative Agent of such request by telephone (a) in
the case of a Eurodollar Borrowing, not later than 11:00 a.m., three (3) Business
Days before the date of the proposed Eurodollar Borrowing or (b) in the
case of an ABR Borrowing, not later than 11:00 a.m., one (1) Business
Day before the date of the proposed ABR Borrowing.  Each such telephonic Borrowing Request shall
be irrevocable and shall be confirmed promptly by hand delivery or telecopy to
the Administrative Agent of a written Borrowing Request in a form approved by
the Administrative Agent and signed by the Borrower.  Each such telephonic and written Borrowing
Request shall specify the following information:

 

(i)                                   the
aggregate amount of the requested Borrowing;

 

(ii)                                the
date of such Borrowing, which shall be a Business Day;

 

(iii)                             whether
such Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing;

 

(iv)                             in
the case of a Eurodollar Borrowing, the initial Interest Period to be
applicable thereto, which shall be a period contemplated by the definition of
the term “Interest Period”; and

 

(v)                                 the
location and number of the Borrower’s account to which funds are to be
disbursed, which shall comply with the requirements of Section 2.06.

 

If no election
as to the Type of Borrowing is specified, then the requested Borrowing shall be
an ABR Borrowing.  If no Interest Period
is specified with respect to any requested Eurodollar Borrowing, then the
Borrower shall be deemed to have selected an Interest Period of one (1) month’s
duration.  Promptly following receipt of
the Borrowing Request in accordance with this Section, the Administrative Agent
shall advise each Lender of the details thereof and of the amount of such
Lender’s Loan to be made as part of the requested Borrowing.

 

Section 2.05.                             [Reserved]

 

Section 2.06.                             Funding
of Borrowings.

 

(a)                                  Each
Lender shall make each Loan to be made by it hereunder on the proposed date
thereof by wire transfer of immediately available funds by 12:00 noon to the
account of the Administrative Agent most recently designated by it for such
purpose by notice to the Lenders.  The
Administrative Agent will make such Loans available to the Borrower by promptly
crediting the amounts so received, in like funds, to an account of the Borrower
designated by the Borrower in the applicable Borrowing Request.

 

21

 

(b)                                 Unless
the Administrative Agent shall have received notice from a Lender prior to the
proposed date of any Borrowing that such Lender will not make available to the
Administrative Agent such Lender’s share of such Borrowing, the Administrative
Agent may assume that such Lender has made such share available on such date in
accordance with paragraph (a) of this Section and may, in reliance
upon such assumption, make available to the Borrower a corresponding
amount.  In such event, if a Lender has
not in fact made its share of the applicable Borrowing available to the
Administrative Agent, then the applicable Lender and the Borrower severally
agree to pay to the Administrative Agent forthwith on demand such corresponding
amount with interest thereon, for each day from and including the date such
amount is made available to the Borrower to but excluding the date of payment
to the Administrative Agent, at (i) in the case of such Lender, the
greater of the Federal Funds Effective Rate and a rate determined by the
Administrative Agent in accordance with banking industry rules on
interbank compensation or (ii) in the case of the Borrower, the interest
rate applicable to ABR Loans.  If such
Lender pays such amount to the Administrative Agent, then such amount shall constitute
such Lender’s Loan included in such Borrowing.

 

Section 2.07.                             Interest
Elections.

 

(a)                                  Each
Borrowing initially shall be of the Type specified in the applicable Borrowing
Request and in the case of a Eurodollar Borrowing, shall have an initial Interest
Period as specified in such Borrowing Request; provided that the Interest
Period for any Eurodollar Borrowing requested on the Effective Date or any Increase
Date and during the thirty (30) day period following the Effective Date or such
Increase Date, as the case may be, shall be of one (1) month’s duration,
unless otherwise agreed by the Borrower and the Administrative Agent.  Thereafter, the Borrower may elect to convert
such Loans to a different Type or to continue such Loans and, in the case of Eurodollar
Loans, may elect Interest Periods therefor, all as provided in this
Section.  The Borrower may elect
different options with respect to different portions of the Loans, in which
case each such portion shall be allocated ratably among the Lenders holding the
Loans comprising such Borrowing, and the Loans comprising each such portion
shall be considered a separate Borrowing.

 

(b)                                 To
make an election pursuant to this Section, the Borrower shall notify the
Administrative Agent of such election by telephone by the time that a Borrowing
Request would be required under Section 2.04 if the Borrower were
requesting a Borrowing of the Type resulting from such election to be made on
the effective date of such election.  Each such telephonic Interest Election Request
shall be irrevocable and shall be confirmed promptly by hand delivery or
telecopy to the Administrative Agent of a written Interest Election Request in
a form approved by the Administrative Agent and signed by the Borrower.

 

(c)                                  Each
telephonic and written Interest Election Request shall specify the following
information:

 

(i)                                     the
Borrowing to which such Interest Election Request applies and, if different
options are being elected with respect to different portions thereof, the

 

22

 

portions thereof to be allocated to each
resulting Borrowing (in which case the information to be specified pursuant to
clauses (iii) and (iv) below shall be specified for each resulting
Borrowing);

 

(ii)                                  the
effective date of the election made pursuant to such Interest Election Request,
which shall be a Business Day;

 

(iii)                               whether
the resulting Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing;
and

 

(iv)                              if
the resulting Borrowing is a Eurodollar Borrowing, the Interest Period to be
applicable thereto after giving effect to such election, which shall be a
period contemplated by the definition of the term “Interest Period”.

 

If any such Interest Election
Request requests a Eurodollar Borrowing but does not specify an Interest
Period, then the Borrower shall be deemed to have selected an Interest Period
of one (1) month’s duration.

 

(d)                                 Promptly
following receipt of an Interest Election Request, the Administrative Agent
shall advise each Lender of the details thereof and of such Lender’s portion of
each resulting Borrowing.

 

(e)                                  If
the Borrower fails to deliver a timely Interest Election Request with respect
to a Eurodollar Borrowing prior to the end of the Interest Period applicable
thereto, then, unless such Borrowing is repaid as provided herein, at the end
of such Interest Period such Borrowing shall be converted to an ABR
Borrowing.  Notwithstanding any contrary
provision hereof, if an Event of Default has occurred and is continuing and the
Administrative Agent, at the request of the Required Lenders, so notifies the
Borrower, then, so long as an Event of Default is continuing (i) no
outstanding Borrowing may be converted to or continued as a Eurodollar
Borrowing and (ii) unless repaid, each Eurodollar Borrowing shall be
converted to an ABR Borrowing at the end of the Interest Period applicable
thereto.

 

(f)                                    All
conversions and continuations of Eurodollar Loans shall be in an aggregate
amount that is an integral multiple of $1,000,000 and not less than $1,000,000.
 All conversions and continuations of ABR
Loans shall be in an aggregate amount that is an integral multiple of $100,000  and not less than $100,000. 
Loans of more than one Type may be outstanding at the same time; provided
that there shall not at any time be more than a total of four (4) Eurodollar
Borrowings outstanding.

 

Section 2.08.                             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 Loan on the
Maturity Date.

 

(b)                                 Borrower
and each surety, endorser, guarantor and other party ever liable for payment of
any sums of money payable under this Agreement, jointly and severally

 

23

 

waive presentment and demand for payment,
notice of intention to accelerate the maturity, protest, notice of protest and
nonpayment, as to the payments due under this Agreement or any other Loan
Document and as to each and all installments hereunder and thereunder, and
agree that their liability under this Agreement or any other Loan Document
shall not be affected by any renewal or extension in the time of payment
hereof, or in any indulgences, or by any release or change in any security for
the payment of the Obligations, and hereby consent to any and all such
renewals, extensions, indulgences, releases or changes.

 

(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, the Class and Type thereof and the
Interest Period applicable thereto, (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 (c) or (d) 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 or Participant may request that Loans made by it be evidenced by a
promissory note.  In such event, the
Borrower shall prepare, execute and deliver to such Lender or Participant a promissory
note payable to the order of such Lender or Participant (or, if requested by
such Lender or Participant, to such Lender or Participant and its registered
assigns) and in the form attached hereto as Exhibit E.  Thereafter, the Loans evidenced by such
promissory note and interest thereon shall at all times (including after
assignment pursuant to Section 11.04) 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 2.09.                             Optional
Prepayment of Loans.

 

(a)                                  The
Borrower shall have the right at any time and from time to time to prepay the
Loans, in whole and or in part in an aggregate amount that is an integral
multiple of $5,000,000 and not less than $10,000,000, without premium or
penalty, subject to prior notice in accordance with paragraph (b) of this
Section.

 

(b)                                 The
Borrower shall notify the Administrative Agent by telephone (confirmed by
telecopy) of any prepayment hereunder (i) in the case of prepayment of

 

24

 

Eurodollar Loans, not later than 11:00 a.m.
three (3) Business Days before the date of prepayment or (ii) in the
case of prepayment of an ABR Loan, not later than 11:00 a.m. one (1) Business
Day before the date of prepayment.  Each
such notice shall be irrevocable and shall specify the prepayment date and the
principal amount of the Loans or portion thereof to be prepaid.  Promptly following receipt of any such notice
relating to the Loans, the Administrative Agent shall advise the Lenders of the
contents thereof.  Each partial
prepayment of the Loans shall be in an amount that would be permitted in the case
of conversion or continuation of the same Type as provided in Section 2.07(f).  Each prepayment of the Loans shall be applied
ratably to the Loans outstanding. 
Prepayments shall be accompanied by accrued interest to the extent
required by Section 2.12 and shall be subject to the payment of any
funding indemnification amounts required by Section 2.15.

 

Section 2.10.                             Mandatory
Prepayment of Loans.

 

(a)                                  The
Borrower shall prepay the Loans as provided in Section 7.03(a).

 

(b)                                 Amounts
applied to the prepayment of the Loans pursuant to this Section shall be
first applied ratably to ABR Loans then outstanding and, upon payment in full
of all outstanding ABR Loans, second, to Eurodollar Loans then outstanding, and
if more than one Eurodollar Borrowing is then outstanding, to each such
Eurodollar Borrowing beginning with the Eurodollar Borrowing with the least
number of days remaining in the Interest Period applicable thereto and ending
with the Eurodollar Borrowing with the most number of days remaining in the
Interest Period applicable thereto, subject to the payment of any funding
indemnification amounts required by Section 2.15 but without penalty or
premium.

 

Section 2.11.                             Fees.

 

(a)                                  The
Borrower agrees to pay to the Administrative Agent, for its own account, fees
payable in the amounts and at the times separately agreed upon between the
Borrower and the Administrative Agent.

 

(b)                                 All
fees payable hereunder shall be paid on the dates due, in immediately available
funds, to the Administrative Agent.  Fees
paid shall not be refundable under any circumstances.

 

Section 2.12.                             Interest.

 

(a)                                  The
ABR Loans comprising each ABR Borrowing shall bear interest at a rate per annum
equal to the Alternate Base Rate plus the Applicable Margin.

 

(b)                                 The
Eurodollar Loans shall bear interest at a rate per annum equal to the Adjusted
LIBO Rate for the Interest Period in effect for such Loans plus the Applicable
Margin.

 

(c)                                  Notwithstanding
the foregoing, if any principal of or interest on any Loan or any fee or other
amount payable by the Borrower hereunder is not paid when due,

 

25

 

whether at stated maturity, upon acceleration
or otherwise, such overdue amount shall bear interest, after as well as before
judgment, at a rate per annum equal to (i) in the case of overdue principal
of any Loan, two percent (2%) plus the rate otherwise applicable to such Loan
as provided in the preceding paragraphs of this Section or (ii) in
the case of any other amount, two percent (2%) plus the rate applicable to ABR
Loans as provided in paragraph (a) of this Section.

 

(d)                                 Accrued
interest on each Loan shall be payable in arrears on each Interest Payment Date
for such Loan and on the Maturity Date; provided that (i) interest
accrued pursuant to paragraph (c) of this Section shall be payable on
demand, (ii) in the event of any repayment or prepayment of any Loan,
accrued interest on the principal amount repaid or prepaid shall be payable on
the date of such repayment or prepayment and (iii) in the event of any
conversion of any Eurodollar Loan prior to the end of the current Interest
Period therefor, accrued interest on such Loan shall be payable on the
effective date of such conversion.

 

(e)                                  All
interest hereunder shall be computed on the basis of a year of 360 days, except
that interest computed by reference to the Alternate Base Rate at times when
the Alternate Base Rate is based on the Prime Rate shall be computed on the
basis of a year of 365 days (or 366 days in a leap year), and in each case
shall be payable for the actual number of days elapsed (including the first day
but excluding the last day).  The
applicable Alternate Base Rate, Adjusted LIBO Rate or LIBO Rate shall be
determined by the Administrative Agent, and such determination shall be conclusive
absent manifest error.

 

Section 2.13.                            Alternate Rate of
Interest.  If prior to the
commencement of any Interest Period for a Eurodollar Borrowing:

 

(a)                                  the
Administrative Agent determines (which determination shall be conclusive absent
manifest error) that adequate and reasonable means do not exist for
ascertaining the Adjusted LIBO Rate or the LIBO Rate, as applicable, for such
Interest Period; or

 

(b)                                 the
Administrative Agent is advised by the Required Lenders that the Adjusted LIBO
Rate or the LIBO Rate, as applicable, for such Interest Period will not
adequately and fairly reflect the cost to such Lenders (or Lender) of making or
maintaining their Loans (or its Loan) included in such Borrowing for such
Interest Period;

 

then the
Administrative Agent shall give notice thereof to the Borrower and the Lenders
by telephone or telecopy as promptly as practicable thereafter and, until the
Administrative Agent notifies the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) any Interest
Election Request that requests the conversion of any Borrowing to, or
continuation of any Borrowing as, a Eurodollar Borrowing shall be ineffective
and (ii) if any Borrowing Request requests a Eurodollar Borrowing, such
Borrowing shall be made as an ABR Borrowing.

 

26

 

Section 2.14.                           Increased Costs.

 

(a)                                  If
any Change in Law shall:

 

(i)                                     impose,
modify or deem applicable any reserve, special deposit or similar requirement
against assets of, deposits with or for the account of, or credit extended by,
any Lender (except any such reserve requirement reflected in the Adjusted LIBO
Rate); or

 

(ii)                                  impose
on any Lender or the London interbank market any other condition affecting this
Agreement or Eurodollar Loans made by such Lender;

 

and the result
of any of the foregoing shall be to increase the cost to such Lender of making
or maintaining any Eurodollar Loan (or of maintaining its obligation to make
any such Loan) or to reduce the amount of any sum received or receivable by
such Lender hereunder (whether of principal, interest or otherwise), then the
Borrower will pay to such Lender such additional amount or amounts as will
compensate such Lender for such additional costs incurred or reduction
suffered.

 

(b)                                 If
any Lender determines that any Change in Law regarding capital requirements has
or would have the effect of reducing the rate of return on such Lender’s
capital or on the capital of such Lender’s holding company, if any, as a
consequence of this Agreement or the Loans made by such Lender to a level below
that which such Lender or such Lender’s holding company could have achieved but
for such Change in Law (taking into consideration such Lender’s policies and
the policies of such Lender’s holding company with respect to capital
adequacy), then from time to time the Borrower will pay to such Lender such
additional amount or amounts as will compensate such Lender or such Lender’s
holding company for any such reduction suffered.

 

(c)                                  A
certificate of a Lender setting forth (i) the amount or amounts reasonably
necessary to compensate such Lender or its holding company, as the case may be,
as specified in paragraph (a) or (b) of this Section, (ii) 
the factual basis for such compensation and (iii) the manner in which such
amount or amounts were calculated shall be delivered to the Borrower.  Such certificate shall be conclusive absent
manifest error.  The Borrower shall pay
such Lender the amount shown as due on any such certificate within ten (10) days
after receipt thereof.

 

(d)                                 Failure
or delay on the part of any Lender to demand compensation pursuant to this Section shall
not constitute a waiver of such Lender’s right to demand such compensation; provided
that the Borrower shall not be required to compensate a Lender pursuant to this
Section for any increased costs or reductions incurred more than one
hundred eighty (180) days prior to the date that such Lender notifies the
Borrower of the Change in Law giving rise to such increased costs or reductions
and of such Lender’s intention to claim compensation therefor; provided  further
that, if the Change in Law giving rise to such increased costs or reductions is
retroactive, then the one hundred eighty (180) day period referred to above
shall be extended to include the period of retroactive effect thereof.

 

27

 

Section 2.15.                             Break
Funding Payments.  In the event of (a) the
payment of any principal of any Eurodollar Loan other than on the last day of
an Interest Period applicable thereto (including as a result of an Event of
Default), (b) the conversion of any Eurodollar Loan other than on the last
day of the Interest Period applicable thereto, (c) the failure to borrow,
convert, continue or prepay any Eurodollar Loan on the date specified in any
notice delivered pursuant hereto (regardless of whether such notice may be
revoked under Section 2.09(b) and is revoked in accordance
therewith), (d) the assignment of any Eurodollar Loan other than on the
last day of the Interest Period applicable thereto as a result of a request by
the Borrower pursuant to Section 2.18, then, in any such event, the
Borrower shall compensate each Lender for the loss, cost and expense
attributable to such event.  In the case
of a Eurodollar Loan, such loss, cost or expense to any Lender shall be deemed
to include an amount determined by such Lender to be the excess, if any, of (i) the
amount of interest which would have accrued on the principal amount of such
Loan had such event not occurred, at the Adjusted LIBO Rate that would have
been applicable to such Loan, for the period from the date of such event to the
last day of the then current Interest Period therefor (or, in the case of a
failure to borrow, convert or continue, for the period that would have been the
Interest Period for such Loan), over (ii) the amount of interest which
would accrue on such principal amount for such period at the interest rate
which such Lender would bid were it to bid, at the commencement of such period,
for dollar deposits of a comparable amount and period from other banks in the eurodollar
market.  A certificate of any Lender
setting forth any amount or amounts that such Lender is entitled to receive
pursuant to this Section shall be delivered to the Borrower and shall be
conclusive absent manifest error.  The
Borrower shall pay such Lender the amount shown as due on any such certificate
within ten (10) days after receipt thereof.

 

Section 2.16.                             Taxes.

 

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

 

(b)                                 In
addition, the Borrower shall pay any Other Taxes to the relevant Governmental
Authority in accordance with applicable law.

 

(c)                                  The
Borrower shall indemnify the Administrative Agent and each Lender, within 10
days after written demand therefor, for the full amount of any Indemnified
Taxes or Other Taxes paid by the Administrative Agent or such Lender, as the
case may be, on or with respect to any payment by or on account of any
obligation of the Borrower hereunder (including Indemnified Taxes or Other
Taxes imposed or asserted on or attributable to amounts payable under this
Section) and any penalties, interest and reasonable expenses arising therefrom
or with respect thereto, whether or not such 

 

28

 

Indemnified Taxes or Other Taxes were
correctly or legally imposed or asserted by the relevant Governmental
Authority.  A certificate delivered to
the Borrower by a Lender or by the Administrative Agent on its own behalf or on
behalf of a Lender, setting forth (i) the amount of such payment or
liability reasonably necessary to compensate the Administrative Agent or such
Lender, as the case may be, (ii) the factual basis for such compensation
and (iii) the manner in which such amount or amounts were calculated,
shall be conclusive absent manifest error.

 

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

 

(e)                                  Any
Foreign Lender that is entitled to an exemption from or reduction of
withholding tax under the law of the jurisdiction in which the Borrower is
located, or any treaty to which such jurisdiction is a party, with respect to
payments under this Agreement shall deliver to the Borrower (with a copy to the
Administrative Agent), at the time or times prescribed by applicable law, such properly
completed and executed documentation prescribed by applicable law or reasonably
requested by the Borrower as will permit such payments to be made without
withholding or at a reduced rate.

 

(f)                                    If the Administrative Agent or a Lender
determines, in its sole discretion, that it has received a refund of any Taxes
or Other Taxes as to which it has been indemnified by the Borrower or with
respect to which the Borrower has paid additional amounts pursuant to this Section 2.16,
it shall pay over such refund to the Borrower (but only to the extent of
indemnity payments made, or additional amounts paid, by the Borrower under this
Section 2.16 with respect to the Taxes or Other Taxes giving rise to such
refund), net of all out-of-pocket expenses of the Administrative Agent or such
Lender and without interest (other than any interest paid by the relevant
Governmental Authority with respect to such refund); provided, that the
Borrower, upon the request of the Administrative Agent or such Lender, agrees
to repay the amount paid over to the Borrower (plus any penalties, interest or
other charges imposed by the relevant Governmental Authority) to the
Administrative Agent or such Lender in the event the Administrative Agent or
such Lender is required to repay such refund to such Governmental Authority.
This Section shall not be construed to require the Administrative Agent or
any Lender to make available its tax returns (or any other information relating
to its taxes which it deems confidential) to the Borrower or any other Person.

 

Section 2.17.                             Payments
Generally; Pro Rata Treatment; Sharing of Set-offs.

 

(a)                                  The
Borrower shall make each payment required to be made by it hereunder (whether
of principal, interest or fees or of amounts payable under Section 2.14, Section 2.15
or Section 2.16, or otherwise) prior to 12:00 noon on the date when due,
in immediately available funds, without set-off or counterclaim.  Any amounts 

 

29

 

received after such time on any date may, in the
discretion of the Administrative Agent, be deemed to have been received on the
next succeeding Business Day for purposes of calculating interest thereon.  All such payments shall be made to the
Administrative Agent at its offices at JPMorgan Loan Services, 21 South Clark
St., 19th Floor, Chicago, Illinois 60603-2003, except as expressly provided
herein and except that payments pursuant to Section 2.14, Section 2.15,
Section 2.16 and Section 11.03 shall be made directly to the Persons
entitled thereto.  The Administrative
Agent shall distribute any such payments received by it for the account of any
other Person to the appropriate recipient promptly following receipt
thereof.  If any payment hereunder shall
be due on a day that is not a Business Day, the date for payment shall be
extended to the next succeeding Business Day, and, in the case of any payment
accruing interest, interest thereon shall be payable for the period of such
extension.  All payments hereunder shall
be made in Dollars.

 

(b)                                 If
at any time insufficient funds are received by and available to the
Administrative Agent and to pay fully all amounts of principal, interest, fees
and other Obligations then due hereunder, such funds shall be applied (i) first,
towards payment of interest and fees then due hereunder, ratably among the
parties entitled thereto in accordance with the amounts of interest and fees
then due to such parties, and (ii) second, towards payment of principal
then due hereunder, ratably among the parties entitled thereto in accordance
with the amounts of principal then due to such parties.

 

(c)                                  If
any Lender shall, by exercising any right of set-off or counterclaim or
otherwise, obtain payment in respect of any principal of or interest on any of
its Loans resulting in such Lender receiving payment of a greater proportion of
the aggregate amount of its Loans and accrued interest thereon than the
proportion received by any other Lender, then the Lender receiving such greater
proportion shall purchase (for cash at face value) participations in the Loans
of other Lenders to the extent necessary so that the benefit of all such
payments shall be shared by the Lenders ratably in accordance with the
aggregate amount of principal of and accrued interest on their respective
Loans; provided that (i) if any such participations are purchased
and all or any portion of the payment giving rise thereto is recovered, such
participations shall be rescinded and the purchase price restored to the extent
of such recovery, without interest, and (ii) the provisions of this
paragraph shall not be construed to apply to any payment made by the Borrower
pursuant to and in accordance with the express terms of this Agreement or any
payment obtained by a Lender as consideration for the assignment of or sale of a
participation in any of its Loans to any assignee or participant, other than to
the Borrower or any Subsidiary or Affiliate thereof (as to which the provisions
of this paragraph shall apply).  The
Borrower consents to the foregoing and agrees, to the extent it may effectively
do so under applicable law, that any Lender acquiring a participation pursuant
to the foregoing arrangements may exercise against the Borrower rights of
set-off and counterclaim with respect to such participation as fully as if such
Lender were a direct creditor of the Borrower in the amount of such
participation.

 

(d)                                 Unless
the Administrative Agent shall have received notice from the Borrower prior to
the date on which any payment is due to the Administrative Agent for the
account of the Lenders hereunder that the Borrower will not make such payment,
the 

 

30

 

Administrative Agent may assume that the
Borrower has made such payment on such date in accordance herewith and may, in
reliance upon such assumption, distribute to the Lenders the amount due.  In such event, if the Borrower have not in
fact made such payment, then each of the Lenders severally agrees to repay to
the Administrative Agent forthwith on demand the amount so distributed to such
Lender with interest thereon, for each day from and including the date such
amount is distributed to it to but excluding the date of payment to the
Administrative Agent, at the greater of the Federal Funds Effective Rate and a
rate determined by the Administrative Agent in accordance with banking industry
rules on interbank compensation.

 

(e)                                  If
any Lender shall fail to make any payment required to be made by it pursuant to
Section 2.06 or Section 2.17(d) or Section 11.03(c), then
the Administrative Agent may, in its discretion (notwithstanding any contrary
provision hereof), apply any amounts thereafter received by the Administrative
Agent for the account of such Lender to satisfy such Lender’s obligations under
such Sections until all such unsatisfied obligations are fully paid.

 

Section 2.18.                             Mitigation
Obligations; Replacement of Lenders.

 

(a)                                  If
any Lender requests compensation under Section 2.14, or if the Borrower is
required to pay any additional amount to any Lender or any Governmental Authority
for the account of any Lender pursuant to Section 2.16, then such Lender
shall use reasonable efforts to designate a different lending office for
funding or booking its Loans hereunder or to assign its rights and obligations
hereunder to another of its offices, branches or Affiliates, if, in the
judgment of such Lender, such designation or assignment (i) would
eliminate or reduce amounts payable pursuant to Section 2.14 or Section 2.16,
as the case may be, in the future and (ii) would not subject such Lender
to any unreimbursed cost or expense and would not otherwise be disadvantageous
to such Lender.  The Borrower hereby
agrees to pay all reasonable costs and expenses incurred by any Lender in
connection with any such designation or assignment.

 

(b)                                 If
any Lender requests compensation under Section 2.14, or if the Borrower is
required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.16, or if
any Lender defaults in its obligation to fund Loans hereunder, then the
Borrower may, at its sole expense and effort, upon notice to such Lender and
the Administrative Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in Section 11.04),
all its interests, rights and obligations under this Agreement to an assignee
that shall assume such obligations (which assignee may be another Lender, if a
Lender accepts such assignment); provided that (i) the Borrower
shall have received the prior written consent of the Administrative Agent,
which consent shall not unreasonably be withheld, (ii) such Lender shall
have received payment of an amount equal to the outstanding principal of its
Loans, accrued interest thereon, accrued fees and all other amounts payable to
it hereunder, from the assignee (to the extent of such outstanding principal
and accrued interest and fees) or the Borrower (in the case of all other
amounts) and (iii) in the case of any such assignment resulting from a
claim for compensation under Section 2.14 or payments required to be made
pursuant to Section 

 

31

 

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

 

(c)                                  If
in connection with any proposed amendment, modification, termination, waiver or
consent with respect to any of the provisions of this Agreement or any other
Loan Document as contemplated by Section 11.02, the consent of Required
Lenders shall have been obtained but the consent of one or more of such other
Lenders (each a “Non-Consenting Lender”) whose consent is required has
not been obtained; then, the Borrower may elect to replace such Non-Consenting
Lender as a Lender party to this Agreement in accordance with and subject to the
restrictions contained in, and consents required by Section 11.04; provided
that (i) the Borrower shall have received the prior written consent of the
Administrative Agent, which consent shall not unreasonably be withheld, (ii) such
Lender shall have received payment of an amount equal to the outstanding
principal of its Loans, accrued interest thereon, accrued fees and all other
amounts payable to it hereunder, from the assignee (to the extent of such
outstanding principal and accrued interest and fees) or the Borrower (in the
case of all other amounts) and (iii) in the case of any such assignment
resulting from a claim for compensation under Section 2.14 or payments
required to be made pursuant to Section 2.16, such assignment will result
in a reduction in such compensation or payments.  A Lender shall not be required to make any
such assignment and delegation if, prior thereto, as a result of a waiver by
such Lender or otherwise, the circumstances entitling the Borrower to require
such assignment and delegation cease to apply.

 

Article III

 

[Reserved]

 

Article IV

 

Representations
and Warranties

 

Each Credit
Party represents and warrants to the Lenders that: (it being understood and
agreed that with respect to the Effective Date such representations and warranties
are deemed to be made concurrently with and after giving effect to the
consummation of the Transactions):

 

Section 4.01.                             Organization;
Powers.  Each Credit Party is duly
organized, validly existing and in good standing under the laws of the jurisdiction
of its organization, has all requisite power and authority to carry on its
business as now conducted and, except where the failure to do so, individually
or in the aggregate, could not reasonably be expected to result in a Material
Adverse Effect, is qualified to do business in, and is in good standing in,
every jurisdiction where such qualification is required.

 

Section 4.02.                             Authorization;
Enforceability.  The Transactions are
within each Credit Party’s corporate, limited liability company or partnership
powers and have been duly authorized by all necessary corporate, limited
liability company or partnership and, if required, stockholder 

 

32

 

action.  This Agreement has been duly executed and
delivered by each Credit Party and constitutes a legal, valid and binding
obligation of each Credit Party, enforceable in accordance with its terms,
subject to applicable bankruptcy, insolvency, reorganization, moratorium or
other laws affecting creditors’ rights generally and subject to general
principles of equity, regardless of whether considered in a proceeding in
equity or at law.

 

Section 4.03.                             Governmental
Approvals; No Conflicts.  The
Transactions (a) do not require any consent or approval of, registration
or filing with, or any other action by, any Governmental Authority, except such
as have been obtained or made and are in full force and effect and, after the
Effective Date, in the case of EXCO, the filing of this Agreement and related
Loan Documents by EXCO with the Securities and Exchange Commission pursuant to
the requirements of the Securities Exchange Act of 1934, as amended, (b) will
not violate any applicable law or regulation or the charter, by-laws or other
Organizational Documents of the Borrower or any Restricted Subsidiary or any
order of any Governmental Authority, (c) will not violate or result in a
default under any indenture, agreement or other instrument evidencing Material
Indebtedness, or give rise to a right thereunder to require any payment to be
made by the Borrower or any Restricted Subsidiary, and (d) will not result
in the creation or imposition of any Lien on any asset of the Borrower or any
Restricted Subsidiary not otherwise permitted under Section 7.02.

 

Section 4.04.                             Financial
Condition; No Material Adverse Change.

 

(a)                                  The
Borrower has heretofore furnished to the Lenders the unaudited consolidated
balance sheet and related statements of income and cash flows of the Borrower
and its Consolidated Subsidiaries for (i) the twelve (12) month period
ending December 31, 2007 and (ii) the three (3) month period
ending March 31, 2008.  Such
financial statements present fairly, in all material respects, the financial
position and results of operations and cash flows of the Borrower and its
Consolidated Subsidiaries as of such dates and for such periods in accordance
with GAAP, subject to year-end audit adjustments and the absences of footnotes.

 

(b)                                 Since
December 31, 2007, there has been no material adverse change in the
business, assets, operations, prospects or condition, financial or otherwise,
of the Borrower and its Subsidiaries, taken as a whole (it being understood
that changes in commodity prices for Hydrocarbons affecting the oil and gas
industry as a whole do not constitute a material adverse change).

 

Section 4.05.                             Properties.

 

(a)                                  Except
as otherwise provided in Section 4.15 with respect to proved reserves
included in the Oil and Gas Interests of the Borrower and each Restricted
Subsidiary, the Borrower and each Restricted Subsidiary has good title to, or
valid leasehold interests in, all such real and personal property material to
its business, except for minor defects in title that do not interfere with its
ability to conduct its business as currently conducted or to utilize such
properties for their intended purposes.

 

33

 

(b)                                 The
Borrower and each Restricted Subsidiary owns, or is licensed to use, all
trademarks, tradenames, copyrights, patents and other intellectual property
material to its business, and the use thereof by the Borrower and such
Restricted Subsidiaries, as the case may be, does not infringe upon the rights
of any other Person, except for any such infringements that, individually or in
the aggregate, could not reasonably be expected to result in a Material Adverse
Effect.

 

Section 4.06.                             Litigation
and Environmental Matters.

 

(a)                                  There
are no actions, suits, investigations, or proceedings by or before any
arbitrator or Governmental Authority pending against or, to the knowledge of
the Borrower, threatened against or affecting the Borrower or any Restricted
Subsidiary, (i) as to which there is a reasonable possibility of an
adverse determination and that, if adversely determined, could reasonably be
expected, individually or in the aggregate, to result in a Material Adverse
Effect (other than the Disclosed Matters) or (ii) that involve this
Agreement or the Transactions.

 

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

 

(c)                                  Since
the date of this Agreement, there has been no change in the status of the
Disclosed Matters that, individually or in the aggregate, has resulted in, or
materially increased the likelihood of, a Material Adverse Effect.

 

Section 4.07.                             Compliance
with Laws and Agreements.  The
Borrower and each Restricted Subsidiary is in compliance with all laws,
regulations and orders of any Governmental Authority applicable to it or its
property and all indentures, agreements and other instruments binding upon it
or its property, except where the failure to do so, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect.  No Default has occurred and is
continuing.

 

Section 4.08.                             Investment
Company Status.  Neither the Borrower
nor any Restricted Subsidiary is an “investment company” as defined in, or
subject to regulation under, the Investment Company Act of 1940.

 

Section 4.09.                             Taxes.  The Borrower and each Restricted Subsidiary
has timely filed or caused to be filed all Tax returns and reports required to
have been filed and has paid or caused to be paid all Taxes required to have
been paid by it, except (a) Taxes that are being contested in good faith
by appropriate proceedings and for which the Borrower or such Restricted
Subsidiary, as applicable, has set aside on its books adequate reserves or (b) to
the extent that the failure to do so could not reasonably be expected to result
in a Material Adverse Effect.

 

34

 

Section 4.10.                             ERISA.  No ERISA Event has occurred or is reasonably
expected to occur that, when taken together with all other such ERISA Events
for which liability is reasonably expected to occur, could reasonably be
expected to result in a Material Adverse Effect.  The present value of all accumulated benefit
obligations under each Plan (based on the assumptions used for purposes of FASB
Statement 87) did not, as of the date of the most recent financial
statements reflecting such amounts, exceed by more than $5,000,000 the fair
market value of the assets of such Plan, and the present value of all
accumulated benefit obligations of all underfunded Plans (based on the
assumptions used for purposes of FASB Statement 87) did not, as of the
date of the most recent financial statements reflecting such amounts, exceed by
more than $25,000,000 the fair market value of the assets of all such
underfunded Plans.

 

Section 4.11.                             Disclosure.  The Borrower has disclosed to the Lenders all
agreements, instruments and corporate or other restrictions to which it or any
Restricted Subsidiary is subject, and all other matters known to it, that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect.  None of the
other reports, financial statements, certificates or other information
furnished by or on behalf of the Borrower or any Restricted Subsidiary to the
Administrative Agent or any Lender in connection with the negotiation of this
Agreement or delivered hereunder (as modified or supplemented by other
information so furnished) contains any material misstatement of fact or omits
to state any material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading; provided
that, with respect to the Projections, the Borrower represents only that such
information was prepared in good faith based on assumptions believed to be
reasonable at the time.

 

Section 4.12.                             Labor
Matters.  There are no strikes, lockouts
or slowdowns against the Borrower or any of its Restricted Subsidiaries pending
or, to the knowledge of the Borrower, threatened that could reasonably be
expected to have a Material Adverse Effect. 
The hours worked by and payments made to employees of the Borrower and
its Restricted Subsidiaries have not been in violation of the Fair Labor
Standards Act or any other Law dealing with such matters to the extent that
such violation could reasonably be expected to have a Material Adverse Effect.

 

Section 4.13.                             Capitalization
and Credit Party Information. 
Schedule 4.13 lists, as of the Effective Date (a) each Subsidiary
that is an Unrestricted Subsidiary and (b) for the Borrower and for each
Restricted Subsidiary its full legal name, its jurisdiction of organization,
its organizational identification number, its federal tax identification
number, the number of shares of capital stock or other Equity Interests
outstanding and the owner(s) of such Equity Interests.

 

Section 4.14.                             Margin
Stock.  Neither the Borrower nor any
Restricted Subsidiary is engaged principally, or as one of its important
activities, in the business of extending credit for the purpose of purchasing
or carrying margin stock (within the meaning of Regulation U issued by the
Board), and no part of the proceeds of any Loan will be used to purchase or
carry any margin stock or to extend credit to others for the purpose of
purchasing or carrying margin stock.

 

Section 4.15.                             Oil
and Gas Interests.  Each Credit Party
has good and defensible title to substantially all of the proved reserves
included in its Oil and Gas Interests (for purposes of this Section 4.15, “proved
Oil and Gas Interests”), free and clear of all Liens except Liens permitted 

 

35

 

pursuant to Section 7.02.  All such proved Oil and Gas Interests are
valid, subsisting, and in full force and effect, and all rentals, royalties,
and other amounts due and payable in respect thereof have been duly paid.  Each well drilled in respect of proved
producing Oil and Gas Interests (1) is capable of, and is presently,
either producing Hydrocarbons in commercially profitable quantities or in the
process of being worked over or enhanced, and the Credit Party that owns such
proved producing Oil and Gas Interests is currently receiving payments for its
share of production, with no funds in respect of any thereof being presently
held in suspense, other than any such funds being held in suspense pending
delivery of appropriate division orders, and (2) has been drilled,
bottomed, completed, and operated in compliance with all applicable laws, in
the case of clauses (1) and (2), except where any failure to satisfy
clause (1) or to comply with clause (2) would not have a Material
Adverse Effect, and no such well which is currently producing Hydrocarbons is
subject to any penalty in production by reason of such well having produced in
excess of its allowable production.

 

Section 4.16.                             Insurance.  The certificate signed by the Responsible
Officer that attests to the existence and adequacy of, and summarizes, the
property and casualty insurance program maintained by the Credit Parties that
has been furnished by the Borrower to the Administrative Agent and the Lenders
as of the Effective Date, is complete and accurate in all material respects as
of the Effective Date and demonstrates the Borrower’s and the Restricted
Subsidiaries’ compliance with Section 6.05.

 

Section 4.17.                             Solvency.

 

(a)                                  Immediately
after the consummation of the Transactions and immediately following the making
of the Loans on the Effective Date and after giving effect to the application
of the proceeds thereof, (1) the fair value of the assets of the Credit
Parties on a consolidated basis, at a fair valuation, will exceed the debts and
liabilities, subordinated, contingent or otherwise, of the Credit Parties on a
consolidated basis; (2) the present fair saleable value of the real and
personal property of the Credit Parties on a consolidated basis will be greater
than the amount that will be required to pay the probable liability of the
Credit Parties on a consolidated basis on their debts and other liabilities,
subordinated, contingent or otherwise, as such debts and other liabilities
become absolute and matured; (3) the Credit Parties on a consolidated
basis will be able to pay their debts and liabilities, subordinated, contingent
or otherwise, as such debts and liabilities become absolute and matured; and (4) the
Credit Parties on a consolidated basis will not have unreasonably small capital
with which to conduct the businesses in which they are engaged as such
businesses are now conducted and are proposed to be conducted after the date
hereof.

 

(b)                                 The
Credit Parties do not intend to, and do not believe that they will, incur debts
beyond their ability to pay such debts as they mature, taking into account the
timing of and amounts of cash to be received by it and the timing of the
amounts of cash to be payable on or in respect of its Indebtedness.

 

36

 

Article V

 

Conditions

 

Section 5.01.                             Effective Date.  The obligations of the Lenders to make the
Initial Loans hereunder shall not become effective until the date on which each
of the following conditions is satisfied (or waived in accordance with Section 11.02):

 

(a)                                  The
Administrative Agent (or its counsel) shall have received from each party
hereto either (i) a counterpart of this Agreement 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.

 

(b)                                 The
Administrative Agent shall have received a favorable written opinion (addressed
to the Administrative Agent and the Lenders and dated the Effective Date) of
Haynes and Boone, L.L.P., counsel for the Credit Parties, substantially in the
form of Exhibit B, and covering such other matters relating to the Credit
Parties, and this Agreement as the Required Lenders shall reasonably
request.  The Credit Parties hereby
request such counsel to deliver such opinion.

 

(c)                                  The
Administrative Agent shall have received such documents and certificates as the
Administrative Agent or its counsel may reasonably request relating to the organization,
existence and good standing of each Credit Party, the authorization of the
Transactions and any other legal matters relating to the Credit Parties, this
Agreement or the Transactions, all in form and substance satisfactory to the
Administrative Agent and its counsel.

 

(d)                                 The
Administrative Agent shall have received a certificate, dated the Effective
Date and signed by a Responsible Officer of the Borrower, confirming that the
Borrower has (i) complied with the conditions set forth in
paragraphs (a) and (b) of Section 5.02, (ii) complied
with the covenants set forth in Section 6.05 (and demonstrating such
compliance by the attachment of an insurance summary and insurance certificates
evidencing the coverage described in such summary), and (iii) complied
with the conditions set forth in paragraphs (j) and (k) of this Section 5.01.

 

(e)                                  The
Administrative Agent, the Lenders and the Arranger shall have received all fees
and other amounts due and payable on or prior to the Effective Date, and, to
the extent invoiced, reimbursement or payment of all out-of-pocket expenses
required to be reimbursed or paid by the Borrower hereunder, including all
fees, expenses and disbursements of counsel for the Administrative Agent to the
extent invoiced on or prior to the Effective Date.

 

(f)                                    The
Administrative Agent shall have received promissory notes duly executed by the
Borrower for each Lender that has requested the delivery of a promissory note
pursuant to and in accordance with Section 2.08(f).

 

37

 

(g)                                 On
or prior to the Effective Date, the Administrative Agent shall have received a
Borrowing Request acceptable to the Administrative Agent setting forth the
Loans requested by the Borrower on the Effective Date, the Type and amount of
each Loan and the accounts to which such Loans are to be funded; provided that
all Borrowings on the Effective Date shall be ABR Borrowings.

 

(h)                                 The
Administrative Agent shall have received a Solvency Certificate in the form
attached hereto as Exhibit D, dated the Effective Date, and signed by a
Responsible Officer of the Borrower.

 

(i)                                     The
Lenders shall have received from the Borrower (i) a pro forma consolidated
balance sheet of the Borrower and its Consolidated Subsidiaries based on the
consolidated balance sheet of the Borrower and its Consolidated Subsidiaries as
of March 31, 2008 and reflecting the consummation of the Transactions, the
related financings and other transactions contemplated by the Loan Documents to
occur on or prior to the Effective Date, which pro forma balance sheet shall be
prepared consistent in all respects with the information previously provided by
the Borrower to the Administrative Agent and the Lenders and otherwise in form
and substance satisfactory to the Administrative Agent, (ii) a pro forma
statement of operations of the Borrower and its Consolidated Subsidiaries for
the twelve month period ending as of the date of the pro forma balance sheet
described in the immediately preceding clause (i) and (iii) the
Projections.

 

(j)                                     Each
Credit Party shall have obtained all approvals required from any Governmental
Authority and all consents of other Persons, in each case that are necessary or
advisable in connection with the Transactions and each of the foregoing shall
be in full force and effect and in form and substance reasonably satisfactory
to the Administrative Agent.  All
applicable waiting periods shall have expired without any action being taken or
threatened by any competent authority which would restrain, prevent or
otherwise impose adverse conditions on the transactions contemplated by the
Loan Documents or the financing thereof and no action, request for stay,
petition for review or rehearing, reconsideration, or appeal with respect to
any of the foregoing shall be pending, and the time for any applicable agency
to take action to set aside its consent on its own motion shall have expired.

 

(k)                                  There
shall not exist any action, suit, investigation, litigation or proceeding or
other legal or regulatory developments, pending or threatened in any court or
before any arbitrator or Governmental Authority that, in the reasonable opinion
of Administrative Agent, singly or in the aggregate, materially impairs the
Transactions, the financing thereof or any of the other transactions
contemplated by the Loan Documents or that could have a Material Adverse
Effect.

 

(l)                                     All
partnership, corporate and other proceedings taken or to be taken in connection
with the Transactions and all documents incidental thereto shall be reasonably
satisfactory in form and substance to Administrative Agent and its counsel, and
Administrative Agent and such counsel shall have received all such counterpart
originals or certified copies of such documents as Administrative Agent may
reasonably request.

 

38

 

(m)                               The
Administrative Agent and the Lenders shall have received the unaudited
financial statements described in Section 4.04(a).

 

(n)                                 The
Borrower shall have delivered to the Administrative Agent a description of the
sources and uses of funding for the Transactions that is consistent with the
terms of the Loan Documents and otherwise satisfactory to the Administrative
Agent and the Arranger and the capitalization, structure and equity ownership
of the Borrower after the Transactions shall be satisfactory to the Lenders in
all respects.

 

(o)                                 The
Revolving Agent, the Credit Parties and the lenders party to the Revolving
Facility (or at least the required percentage thereof) shall have executed and
delivered the Second Amendment to the Revolving Facility and a duly executed
copy thereof shall have been delivered to the Administrative Agent.

 

The
Administrative Agent shall notify the Borrower and the Lenders of the Effective
Date, and such notice shall be conclusive and binding.  Notwithstanding the foregoing, the
obligations of the Lenders to make the Initial Loans hereunder shall not become
effective unless each of the foregoing conditions is satisfied (or waived
pursuant to Section 11.02) at or prior to 3:00 p.m. on July 31,
2008.

 

Section 5.02.                             Each Credit Event.  The obligation of each Lender to make a Loan
on the occasion of any Borrowing is subject to the satisfaction of the
following conditions:

 

(a)                                  The
representations and warranties of each Credit Party set forth in the Loan
Documents shall be true and correct in all material respects on and as of the
date of such Borrowing, except to the extent that such representations and
warranties specifically refer to an earlier date, in which case they shall be
true and correct as of such earlier date.

 

(b)                                 At
the time of and immediately after giving effect to such Borrowing, no Default
shall have occurred and be continuing.

 

Each Borrowing
shall be deemed to constitute a representation and warranty by the Borrower on
the date thereof as to the matters specified in paragraphs (a) and (b) of
this Section.

 

Article VI

 

Affirmative
Covenants

 

Until (i) the
Availability Period has expired or been terminated and (ii) the principal
of and interest on each Loan and all fees payable hereunder shall have been
paid in full, each Credit Party covenants and agrees with the Lenders that:

 

Section 6.01.                             Financial Statements;
Other Information.  The Borrower will
furnish to the Administrative Agent and each Lender:

 

(a)                                  [Reserved];

 

39

 

(b)                                 within
forty-five (45) days after the end of each fiscal quarter of the Borrower
(including the fiscal quarter ending June 30, 2008), the consolidated (and
unaudited consolidating) balance sheet and related consolidated (and with
respect to statements of operations, consolidating) statements of operations,
partners’ equity and cash flows of the Borrower and its Consolidated
Subsidiaries as of the end of and for such fiscal quarter and the then elapsed
portion of the fiscal year, setting forth in each case in comparative form the
figures for the corresponding period or periods of (or, in the case of the
balance sheet, as of the end of) the previous fiscal year, all certified by a
Responsible Officer as presenting fairly in all material respects the financial
condition and results of operations of the Borrower and its Consolidated
Subsidiaries on a consolidated and consolidating basis in accordance with GAAP
consistently applied, subject to normal year-end audit adjustments and the
absence of footnotes;

 

(c)                                  concurrently
with any delivery of financial statements under clause (a) or (b) above
(other than with respect to the fiscal quarter ending June 30, 2008), a
certificate in a form reasonably acceptable to Administrative Agent signed by a
Responsible Officer of the Borrower (i) certifying as to whether a Default
has occurred and, if a Default has occurred, specifying the details thereof and
any action taken or proposed to be taken with respect thereto, and (ii) setting
forth reasonably detailed calculations demonstrating compliance with clauses
(a), (b) and (c) of Section 7.11;

 

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

 

(e)                                  promptly
following any request therefor, such other information regarding the
operations, business affairs and financial condition of any Credit Party, or
compliance with the terms of this Agreement, as the Administrative Agent or any
Lender may reasonably request.

 

Documents
required to be delivered pursuant to Section 6.01(a) or Section 6.01(b) or
Section 6.01(d) may be delivered electronically and if so delivered,
shall be deemed to have been delivered on the date (i) on which the
Borrower posts such documents, or provides a link thereto on the Borrower’s
website on the Internet at the website address identified in Section 11.01
on which such documents are posted on the Borrower’s behalf on an Internet or
intranet website, if any, to which each Lender and the Administrative Agent
have access (whether a commercial, third-party website or whether sponsored by
the Administrative Agent); provided that: (i) the Borrower shall
deliver paper copies of such documents to the Administrative Agent or any
Lender that requests the Borrower to deliver such paper copies until a written
request to cease delivering paper copies is given by the Administrative Agent
or such Lender and (ii) the Borrower shall notify the Administrative Agent
and each Lender (by telecopier or electronic mail) of the posting of any such
documents and provide to the Administrative Agent by electronic mail electronic
versions (i.e., soft copies) of such documents.  Notwithstanding anything contained herein, in
every instance the Borrower shall be required to provide paper 

 

40

 

copies of the
Compliance Certificates required by Section 6.01(c) to the
Administrative Agent.  Except for such
Compliance Certificates, the Administrative Agent shall have no obligation to
request the delivery or to maintain copies of the documents referred to above,
and in any event shall have no responsibility to monitor compliance by the
Borrower with any such request for delivery, and each Lender shall be solely
responsible for requesting delivery to it or maintaining its copies of such
documents.

 

The Borrower
hereby acknowledges that (a) the Administrative Agent and/or the Arranger
will make available to the Lenders and/or information provided by or on behalf
of the Borrower hereunder (collectively, “Borrower Materials”) by
posting the Borrower Materials on IntraLinks or another similar electronic
system (the “Platform”) and (b) certain of the Lenders may be “public-side”
Lenders (i.e., Lenders that do
not wish to receive material non-public information with respect to the
Borrower or its securities) (each, a “Public Lender”).  The Borrower hereby agrees that (w) all
Borrower Materials that are to be made available to Public Lenders shall be
clearly and conspicuously marked “PUBLIC” which, at a minimum, shall mean that
the word “PUBLIC” shall appear prominently on the first page thereof; (x) by
marking Borrower Materials “PUBLIC,” the Borrower shall be deemed to have
authorized the Administrative Agent, the Arranger and the Lenders to treat such
Borrower Materials as either publicly available information or not material
information (although it may be sensitive and proprietary) with respect to the
Borrower or its securities for purposes of United States Federal and state
securities laws; (y) all Borrower Materials marked “PUBLIC” are permitted
to be made available through a portion of the Platform designated “Public
Investor;” and (z) the Administrative Agent and the Arranger shall be
entitled to treat Borrower’s Materials that are not marked “PUBLIC” as being
suitable only for posting on a portion of the Platform not designated “Public
Investor.”

 

Section 6.02.                             Notices of Material
Events.  The Borrower will furnish to
the Administrative Agent and each Lender prompt written notice of the
following:

 

(a)                                  the
occurrence of any Default;

 

(b)                                 the
filing or commencement of any action, suit or proceeding by or before any
arbitrator or Governmental Authority against or affecting any Credit Party or
any Affiliate thereof that, if adversely determined, could reasonably be
expected to result in a Material Adverse Effect;

 

(c)                                  the
occurrence of any ERISA Event that, alone or together with any other ERISA
Events that have occurred, could reasonably be expected to result in liability
of the Borrower and the Restricted Subsidiaries in an aggregate amount
exceeding $25,000,000;

 

(d)                                 any
written notice or written claim to the effect that any Credit Party is or may
be liable to any Person as a result of the release by any Credit Party, or any
other Person of any Hazardous Materials into the environment, which could
reasonably be expected to have a Material Adverse Effect;

 

41

 

(e)                                  any
written notice alleging any violation of any Environmental Law by any Credit
Party, which could reasonably be expected to have a Material Adverse Effect;

 

(f)                                    the
receipt by the Borrower or any Restricted Subsidiary of any management letter
or comparable analysis prepared by the auditors for the Borrower or any such
Restricted Subsidiary; and

 

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

 

Each notice
delivered under this Section shall be accompanied by a statement of a
Responsible Officer or other executive officer of the Borrower setting forth
the details of the event or development requiring such notice and any action
taken or proposed to be taken with respect thereto.

 

Section 6.03.                             Existence; Conduct of
Business.  The Borrower will, and
will cause each Restricted Subsidiary to, do or cause to be done all things
necessary to preserve, renew and keep in full force and effect its legal
existence and the rights, licenses, permits, privileges and franchises material
to the conduct of its business; provided that the foregoing shall not
prohibit any merger, consolidation, liquidation or dissolution permitted under Section 7.03.

 

Section 6.04.                             Payment of Obligations.  The Borrower will, and will cause each
Restricted Subsidiary to, pay its obligations, including Tax liabilities, that,
if not paid, could result in a Material Adverse Effect before the same shall
become delinquent or in default, except where (a) the validity or amount
thereof is being contested in good faith by appropriate proceedings, (b) the
Borrower or such Restricted Subsidiary has set aside on its books adequate
reserves with respect thereto in accordance with GAAP and (c) the failure
to make payment pending such contest could not reasonably be expected to result
in a Material Adverse Effect.

 

Section 6.05.                             Maintenance of
Properties; Insurance.  The Borrower
will, and will cause each Restricted Subsidiary to, use commercially reasonable
efforts to cause each operator of its Oil and Gas Interests to, (a) keep
and maintain all property material to the conduct of its business in good
working order and condition, ordinary wear and tear excepted, and (b) maintain,
with financially sound and reputable insurance companies, insurance in such
amounts and against such risks as are customarily maintained by companies
engaged in the same or similar businesses operating in the same or similar
locations.  On or prior to the Effective
Date and thereafter, upon request of the Administrative Agent, the Borrower
will furnish or cause to be furnished to the Administrative Agent from time to
time a summary of the respective insurance coverage of the Borrower and its
Restricted Subsidiaries in form and substance reasonably satisfactory to the
Administrative Agent, and, if requested, will furnish the Administrative Agent
copies of the applicable policies.  Upon
demand by Administrative Agent, the Borrower will cause any insurance policies
covering any such property to be endorsed (a) to provide that such
policies may not be cancelled, reduced or affected in any manner for any reason
without fifteen (15) days prior notice to Administrative Agent, and (b) to
provide for such other matters as the Lenders may reasonably require.

 

42

 

Section 6.06.                             Books and Records;
Inspection Rights.  The Borrower
will, and will cause each Restricted Subsidiary to, keep proper books of record
and account in which full, true and correct entries are made of all dealings
and transactions in relation to its business and activities.  The Borrower will, and will cause each
Restricted Subsidiary to, permit any representatives designated by the
Administrative Agent or any Lender, upon reasonable prior notice, to visit and
inspect its properties, to examine and make extracts from its books and
records, and to discuss its affairs, finances and condition with its officers
and, provided an officer of the Borrower has the reasonable opportunity to
participate, its independent accountants, all at such reasonable times and as
often as reasonably requested.

 

Section 6.07.                             Compliance with Laws.  The Borrower will, and will cause each
Restricted Subsidiary to, comply with all laws, rules, regulations and orders
of any Governmental Authority applicable to it or its property, except where
the failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect.

 

Section 6.08.                             Use of Proceeds.  The proceeds of the Loans will be used only
to (a) pay the fees, expenses and transaction costs of the Transactions
and (b) finance the working capital needs of the Borrower, including
capital expenditures, and for general corporate purposes of the Borrower and
the Guarantors, in the ordinary course of business, including the exploration,
acquisition and development of Oil and Gas Interests.  No part of the proceeds of any Loan will be
used, whether directly or indirectly, to purchase or carry any margin stock (as
defined in Regulation U issued by the Board).

 

Section 6.09.                             [Reserved].

 

Section 6.10.                             [Reserved].

 

Section 6.11.                             [Reserved].
Operation of Oil and Gas Interests. Each Borrower will, and will cause each
Restricted Subsidiary to, maintain, develop and operate its Oil and Gas
Interests in a good and workmanlike manner, and observe and comply with all of
the terms and provisions, express or implied, of all oil and gas leases
relating to such Oil and Gas Interests so long as such Oil and Gas Interests
are capable of producing Hydrocarbons and accompanying elements in paying
quantities, except where such failure to comply could not reasonably be
expected to have a Material Adverse Effect.

 

(b)                                 Borrower
will, and will cause each Restricted Subsidiary to, comply in all respects with
all contracts and agreements applicable to or relating to its Oil and Gas
Interests or the production and sale of Hydrocarbons and accompanying elements
therefrom, except to the extent a failure to so comply could not reasonably be
expected to have a Material Adverse Effect.

 

Section 6.13.                             Restricted Subsidiaries.  In the event any Person is or becomes a
Restricted Subsidiary, Borrower will (a) promptly take all such action and
execute and deliver, or cause to be executed and delivered, to the
Administrative Agent all such documents, opinions, instruments, agreements, and
certificates similar to those described in Section 5.01(b) and Section 5.01(c) that
the Administrative Agent may request, and (b) promptly cause such 

 

43

 

Restricted Subsidiary to become
a party to this Agreement and Guarantee the Obligations by executing and
delivering to the Administrative Agent a Counterpart Agreement in the form of Exhibit C.  Upon delivery of any such Counterpart
Agreement to the Administrative Agent, notice of which is hereby waived by each
Credit Party, such Restricted Subsidiary shall be a Guarantor and shall be as
fully a party hereto as if such Restricted Subsidiary were an original
signatory hereto.  Each Credit Party
expressly agrees that its obligations arising hereunder shall not be affected
or diminished by the addition or release of any other Credit Party
hereunder.  This Agreement shall be fully
effective as to any Credit Party that is or becomes a party hereto regardless
of whether any other Person becomes or fails to become or ceases to be a Credit
Party hereunder.  With respect to each
such Restricted Subsidiary, the Borrower shall promptly send to the
Administrative Agent written notice setting forth with respect to such Person
the date on which such Person became a Restricted Subsidiary of the Borrower,
and supplement the data required to be set forth in the Schedules to this
Agreement as a result of the acquisition or creation of such Restricted
Subsidiary; provided that such supplemental data must be reasonably acceptable
to the Administrative Agent and Required Lenders.

 

Article VII

 

Negative
Covenants

 

Until (i) the
Availability Period has expired or been terminated and (ii) the principal
of and interest on each Loan and all fees payable hereunder have been paid in
full, each Credit Party covenants and agrees with the Lenders that:

 

Section 7.01.                             Indebtedness.  The Borrower will not, nor will it permit any
of its Restricted Subsidiaries to, create, incur, assume or permit to exist any
Indebtedness, except:

 

(a)                                  The
Obligations;

 

(b)                                 Indebtedness
existing on the date hereof and set forth in Schedule 7.01 and extensions,
renewals and replacements of any such Indebtedness that do not increase the
outstanding principal amount thereof;

 

(c)                                  Indebtedness
of the Borrower to any Guarantor and of any Guarantor to the Borrower or any
other Guarantor; provided, that (i) all such Indebtedness shall be
unsecured and subordinated in right of payment to the payment in full of all of
the Obligations as provided in Section 8.06 and (ii) all such
Indebtedness is evidenced by promissory notes in form and substance reasonably
satisfactory to the Administrative Agent;

 

(d)                                 Guarantees
of the Obligations;

 

(e)                                  Indebtedness
of the Borrower and the Restricted Subsidiaries incurred to finance the
acquisition, construction or improvement of any fixed or capital assets,
including Capital Lease Obligations and any Indebtedness assumed in connection
with the acquisition of any such assets or secured by a Lien on any such assets
prior to the acquisition thereof, and extensions, renewals and replacements of
any such Indebtedness that do not increase the outstanding principal amount
thereof; provided that (i) such 

 

44

 

Indebtedness is incurred prior
to or within 90 days after such acquisition or the completion of such
construction or improvement and (ii) the aggregate principal amount of
Indebtedness permitted by this clause (e) shall not exceed $10,000,000 at
any time outstanding;

 

(f)                                    Indebtedness
incurred or deposits made by the Borrower and any Restricted Subsidiary (i) under
worker’s compensation laws, unemployment insurance laws or similar legislation,
or (ii) in connection with bids, tenders, contracts (other than for the
payment of Indebtedness) or leases to which such Credit Party is a party, (iii) to
secure public or statutory obligations of such Credit Party, and (iv) of
cash or U.S. Government Securities made to secure the performance of statutory
obligations, surety, stay, customs and appeal bonds to which such Credit Party
is a party in connection with the operation of the Oil and Gas Interests, in
each case in the ordinary course of business;

 

(g)                                 Indebtedness
of any Borrower or any Restricted Subsidiary under Swap Agreements to the
extent permitted under Section 7.05;

 

(h)                                 Indebtedness
under the Revolving Facility in an aggregate principal amount not exceeding
$1,300,000,000 at any time outstanding; and

 

(i)                                     Other
unsecured Indebtedness of the Credit Parties in an aggregate principal amount
not exceeding $25,000,000 at any time outstanding.

 

Section 7.02.                             Liens.  The Borrower will not, nor will it permit any
of its Restricted Subsidiaries to, create, incur, assume or permit to exist any
Lien on any property or asset now owned or hereafter acquired by it, or assign
or sell any income or revenues (including accounts receivable) or rights in
respect of any thereof, except:

 

(a)                                  Permitted
Encumbrances;

 

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

 

(c)                                  any
Lien existing on any property or asset prior to the acquisition thereof by the
Borrower or any Restricted Subsidiary or existing on any property or asset of
any Person that becomes a Restricted Subsidiary after the date hereof prior to
the time such Person becomes a Restricted Subsidiary; provided that (i) such
Lien secures Indebtedness permitted by Section 7.01(e), (ii) such
Lien is not created in contemplation of or in connection with such acquisition
or such Person becoming a Restricted Subsidiary, as the case may be, (iii) such
Lien shall not apply to any other property or assets of the Borrower or any
other Restricted Subsidiary and (iv) such Lien shall secure only those
obligations which it secures on the date of such acquisition or the date such
Person becomes a Restricted Subsidiary, as the case may be and extensions,
renewals and replacements thereof that do not increase the outstanding
principal amount thereof; and

 

45

 

(d)                                 Liens
on fixed or capital assets acquired, constructed or improved by the Borrower or
any Restricted Subsidiary; provided that (i) such Liens, secure
Indebtedness permitted by Section 7.01, (ii) such security interests
and the Indebtedness secured thereby are incurred prior to or within
90 days after such acquisition or the completion of such construction or
improvement, (iii) the Indebtedness secured thereby does not exceed the
cost of acquiring, constructing or improving such fixed or capital assets and (iv) such
security interests shall not apply to any other property or assets of the
Borrower or any other Restricted Subsidiaries; and

 

(e)                                  Liens
securing Indebtedness permitted by clause (h) of Section 7.01.

 

Section 7.03.                             Fundamental Changes.

 

(a)                                  The
Borrower will not, nor will it permit any of its Restricted Subsidiaries to,
merge into or consolidate with any other Person, or permit any other Person to
merge into or consolidate with it, or sell, transfer, lease or otherwise
dispose of (in one transaction or in a series of transactions) all or any
substantial part of its assets, or any of its Oil and Gas Interests (including
any contribution or transfer of Oil and Gas Interests in connection with the
formation of any joint venture or partnership with any Person that is not a
Restricted Subsidiary) or any of the Equity Interests of any Restricted
Subsidiary (in each case, whether now owned or hereafter acquired), or
liquidate or dissolve, except that, (i) the Borrower or any Restricted
Subsidiary may sell Hydrocarbons produced from its Oil and Gas Interests in the
ordinary course of business, and if at the time thereof and immediately after
giving effect thereto no Default shall have occurred and be continuing, (ii) any
Restricted Subsidiary may merge into the Borrower in a transaction in which the
Borrower is the surviving entity, (iii) any Restricted Subsidiary may
merge into any other Restricted Subsidiary in a transaction in which the
surviving entity is a Restricted Subsidiary, (iv) any Restricted
Subsidiary may sell, transfer, lease or otherwise dispose of its assets to the
Borrower or to another Restricted Subsidiary, (v) any Restricted
Subsidiary may liquidate or dissolve if the Borrower determines in good faith
that such liquidation or dissolution is in the best interests of the Borrower
and is not materially disadvantageous to the Lenders, (vi) the Borrower or
any Restricted Subsidiary may sell, transfer, lease or otherwise dispose of
equipment and related items in the ordinary course of business, that are
obsolete or no longer necessary in the business of the Borrower or any of its
Restricted Subsidiaries or that is being replaced by equipment of comparable
value and utility, and (vii) the Borrower or any Restricted Subsidiary may
sell, transfer, lease, exchange, abandon or otherwise dispose of any of its Oil
and Gas Interests and the Equity Interests of any Restricted Subsidiary; provided
that (A) the consideration received in respect of such sale or other
disposition shall be equal to or greater than the fair market value of such
assets subject to the sale or other disposition (as reasonably determined by,
in the case of any sale or disposition of assets with a value equal to or
greater than $15,000,000, the Board of Directors of the Borrower and, if
requested by the Administrative Agent, the Borrower shall deliver a certificate
of a Responsible Officer certifying to that effect), (B) 100% of the
consideration for such sale or other disposition shall be in the form of cash
or Permitted Investments and (C) to the extent that the aggregate Net Cash
Proceeds from all such sales or other dispositions since the Effective Date exceed
$50,000,000 and such prepayment is permitted under the Revolving Credit 

 

46

 

Agreement as in effect on the
Effective Date, an amount equal to 100% of the Net Cash Proceeds received from
such sale or other disposition shall be used to prepay the Loans.

 

(b)                                 The
Borrower will not, nor will it permit any of its Restricted Subsidiaries to,
engage to any material extent in any business other than businesses of the type
conducted by the Borrower and its Restricted Subsidiaries on the date of
execution of this Agreement and after giving effect to the Transactions and
businesses reasonably related thereto.

 

Section 7.04.                             Investments, Loans,
Advances, Guarantees and Acquisitions. 
The Borrower will not, nor will it permit any of its Restricted
Subsidiaries to, purchase, hold or acquire (including pursuant to any merger
with any Person that was not a wholly owned Restricted Subsidiary prior to such
merger) any capital stock, evidences of Indebtedness or other securities
(including any option, warrant or other right to acquire any of the foregoing)
of, make or permit to exist any loans or advances to, Guarantee any
Indebtedness of, or make or permit to exist any investment or any other
interest in, any other Person, or purchase or otherwise acquire (in one
transaction or a series of transactions) any assets of any other Person
constituting a business unit, except:

 

(a)                                  Permitted
Investments;

 

(b)                                 investments
by the Borrower in the Equity Interests of any Restricted Subsidiary;

 

(c)                                  investments
by the Borrower or Guarantor consisting of intercompany Indebtedness permitted
under Section 7.01(c)

 

(d)                                 Guarantees
constituting Indebtedness permitted by Section 7.01;

 

(e)                                  investments
by the Borrower and its Restricted Subsidiaries that are (1) customary in
the oil and gas business, (2) made in the ordinary course of the Borrower’s
or such Restricted Subsidiary’s business, and (3) made in the form of, or
pursuant to, oil, gas and mineral leases, operating agreements, farm-in agreements,
farm-out agreements, development agreements, unitization agreements, joint
bidding agreements, services contracts and other similar agreements that a
reasonable and prudent oil and gas industry owner or operator would find
acceptable (excluding, however, any joint venture or partnership with any
Person that is not a Restricted Subsidiary);

 

(f)                                    investments
consisting of Swap Agreements to the extent permitted under Section 7.05;
and

 

(g)                                 other
investments by the Borrower and the Restricted Subsidiaries; provided
that, on the date any such other investment is made, the amount of such
investment, together with all other investments made pursuant to this clause (g) of
Section 7.04 (in each case determined based on the cost of such
investment) since the Effective Date, does not exceed in the aggregate,
$10,000,000.

 

47

 

Section 7.05.                             Swap Agreements.  The Borrower will not, nor will it permit any
of its Restricted Subsidiaries to, enter into or maintain any Swap Agreement,
except the Existing Swap Agreements and Swap Agreements entered into in the
ordinary course of business with Approved Counterparties and not for
speculative purposes to (a) hedge or mitigate Crude Oil and Natural Gas
price risks to which the Borrower or any Restricted Subsidiary has actual
exposure and (b) effectively cap, collar or exchange interest rates (from
fixed to floating rates, from one floating rate to another floating rate or
otherwise) with respect to any interest-bearing liability or investment of any
Credit Party.

 

Section 7.06.                             Restricted Payments.  The Borrower will not, nor will it permit any
of its Restricted Subsidiaries to, declare or make, or agree to pay or make,
directly or indirectly, any Restricted Payment, except that (a) the
Borrower may declare and make Restricted Payments with respect to its Equity
Interests payable solely in its Equity Interests (other than Disqualified
Stock), (b) the Borrower may make Restricted Payments pursuant to and in
accordance with stock option plans or other benefit plans for management or
employees of the Borrower and its Restricted Subsidiaries in an aggregate
amount not to exceed $2,000,000 in any fiscal year, (c) any Restricted
Subsidiary may make Restricted Payments to the Borrower or any Guarantor;
provided that no Default has occurred and is continuing or would result from
the making of such Restricted Payment, and (d) Restricted Payments by the
Borrower to the holders of its Equity Interests in an aggregate amount not to
exceed $70,000,000; provided that (i) no Default has occurred and is
continuing or would result from the making of such Restricted Payment, (ii) EXCO
owns, directly or indirectly, all of the Equity Interests of the Borrower and (iii) after
giving effect to such Restricted Payment, the Borrowing Base Usage (calculated
in accordance with the Revolving Credit Agreement as in effect on the Effective
Date) is not more than ninety percent (90%).

 

Section 7.07.                             Transactions with
Affiliates.  The Borrower will not,
nor will it permit any of its Restricted Subsidiaries to, sell, lease or
otherwise transfer any property or assets to, or purchase, lease or otherwise
acquire any property or assets from, or otherwise engage in any other
transactions with, any of its Affiliates, except (a) in the ordinary
course of business at prices and on terms and conditions not less favorable to
the Borrower or such Restricted Subsidiary than could be obtained on an arm’s-length
basis from unrelated third parties, (b) transactions between or among the
Borrower and its Restricted Subsidiaries not involving any other Affiliate, (c) transactions
described on Schedule 7.07, and (d) any Restricted Payment permitted by Section 7.06.

 

Section 7.08.                             Restrictive Agreements.  The Borrower will not, nor will it permit any
of its Restricted Subsidiaries to, directly or indirectly, enter into, incur or
permit to exist any agreement or other arrangement that prohibits, restricts or
imposes any condition upon (a) the ability of the Borrower or any
Restricted Subsidiary to create, incur or permit to exist any Lien upon any of
its property or assets, or (b) the ability of any Restricted Subsidiary to
pay dividends or other distributions with respect to any of its Equity
Interests or to make or repay loans or advances to the Borrower or any
Restricted Subsidiary or to Guarantee Indebtedness of the Borrower or any
Restricted Subsidiary; provided that (i) the foregoing shall not
apply to restrictions and conditions imposed by law or by this Agreement, (ii) the
foregoing shall not apply to restrictions and conditions set forth in the
Revolving Facility Documents, (iii) the foregoing shall not apply to
restrictions and conditions existing on the date hereof identified on 

 

48

 

Schedule 7.08
(but shall apply to any extension or renewal of, or any amendment or
modification expanding the scope of, any such restriction or condition), (iv) clause
(a) of the foregoing shall not apply to restrictions or conditions imposed
by any agreement relating to secured Indebtedness permitted by this Agreement
(other than the Revolving Facility) if such restrictions or conditions apply
only to the property or assets securing such Indebtedness and (v) clause (a) of
the foregoing shall not apply to customary provisions in leases and other
contracts restricting the assignment thereof.

 

Section 7.09.                             Disqualified Stock;
Fiscal Year.  The Borrower will not,
nor will it permit any of its Restricted Subsidiaries to, issue any
Disqualified Stock nor will it change its fiscal year.

 

Section 7.10.                             Amendments to
Organizational Documents and Certain Liens and Guarantees.  The Borrower will not, nor will it permit any
of its Restricted Subsidiaries to, enter into or permit any material
modification or amendment of, or waive any material right or obligation of any
Person under its Organizational Documents. 
The Borrower will not permit any Subsidiary to Guarantee all or any part
of the Indebtedness under the Revolving Facility Documents unless such
Subsidiary is (or concurrently with any such Guarantee becomes) a Guarantor.

 

Section 7.11.                             Financial Covenants.

 

(a)                                  Consolidated
Current Ratio.  The Borrower will not
permit the Consolidated Current Ratio as of the end of any fiscal quarter
ending on or after September 30, 2008 to be less than 1.00 to 1.00;
provided that for purposes of determining compliance with this Section 7.11(a),
the calculation of Consolidated Current Liabilities as of the end of any fiscal
quarter ending on or before December 15, 2008, shall not include any
Indebtedness of the Borrower under this Agreement.

 

(b)                                 Leverage
Ratio.  The Borrower will not permit
the ratio, determined as of the end of any fiscal quarter ending on or after September 30,
2008, of (A) Consolidated Funded Indebtedness as of the end of such fiscal
quarter to (B) Consolidated EBITDAX for the trailing four fiscal quarter
period ending on such date, to be greater than 3.50 to 1.00.

 

(c)                                  Interest
Coverage Ratio.  The Borrower will
not permit the ratio, determined as of the end of any fiscal quarter ending on
or after September 30, 2008, of (A) Consolidated EBITDAX for the
trailing four fiscal quarter period ending on such date, to (B) Consolidated
Interest Expense for such four fiscal quarter period to be less than 2.50 to
1.00.

 

Section 7.12.                             Sale and Leaseback
Transactions and other Off-Balance Sheet Liabilities.  The Borrower will not, nor will it permit any
Restricted Subsidiary to, enter into or suffer to exist any (i) Sale and
Leaseback Transaction or (ii) any other transaction pursuant to which it
incurs or has incurred Off-Balance Sheet Liabilities, except for Swap
Agreements permitted under the terms of Section 7.05 and Advance Payment
Contracts; provided, that the aggregate amount of 

 

49

 

all Advance Payments received
by any Credit Party that have not been satisfied by delivery of production at
any time does not exceed, in the aggregate $25,000,000.

 

Article VIII

 

Guarantee of
Obligations

 

Section 8.01.                             Guarantee of Payment.  Each Guarantor unconditionally and
irrevocably guarantees to the Administrative Agent for the benefit of the
Lenders, the punctual payment of all Obligations now or which may in the future
be owing by the Borrower under the Loan Documents (the “Guaranteed
Liabilities”).  This Guarantee is a
guaranty of payment and not of collection only. 
The Administrative Agent shall not be required to exhaust any right or
remedy or take any action against the Borrower or any other Person or any
collateral.  The Guaranteed Liabilities
include interest accruing after the commencement of a proceeding under
bankruptcy, insolvency or similar laws of any jurisdiction at the rate or rates
provided in the Loan Documents, regardless of whether such interest is an
allowed claim.  Each Guarantor agrees
that, as between the Guarantor and the Administrative Agent, the Guaranteed
Liabilities may be declared to be due and payable for the purposes of this
Guarantee notwithstanding any stay, injunction or other prohibition which may
prevent, delay or vitiate any declaration as regards the Borrower or any other
Guarantor and that in the event of a declaration or attempted declaration, the
Guaranteed Liabilities shall immediately become due and payable by each
Guarantor for the purposes of this Guarantee.

 

Section 8.02.                             Guarantee Absolute.  Each Guarantor guarantees that the Guaranteed
Liabilities shall be paid strictly in accordance with the terms of this
Agreement and the other Loan Documents. 
The liability of each Guarantor hereunder is absolute and unconditional
irrespective of:  (a) any change in
the time, manner or place of payment of, or in any other term of, all or any of
the Loan Documents or the Guaranteed Liabilities, or any other amendment or
waiver of or any consent to departure from any of the terms of any Loan
Document or Guaranteed Liability, including any increase or decrease in the
rate of interest thereon; (b) any release or amendment or waiver of, or
consent to departure from, any other guaranty or support document, or any
exchange, release or non-perfection of any collateral, for all or any of the
Loan Documents or Guaranteed Liabilities; (c) any present or future law,
regulation or order of any jurisdiction (whether of right or in fact) or of any
agency thereof purporting to reduce, amend, restructure or otherwise affect any
term of any Loan Document or Guaranteed Liability; (d) without being
limited by the foregoing, any lack of validity or enforceability of any Loan
Document or Guaranteed Liability; and (e) any other setoff, defense or
counterclaim whatsoever (in any case, whether based on contract, tort or any
other theory) with respect to the Loan Documents or the transactions
contemplated thereby which might constitute a legal or equitable defense
available to, or discharge of, the Borrower or a Guarantor.

 

Section 8.03.                             Guarantee Irrevocable.  This Guarantee is a continuing guaranty of
the payment of all Guaranteed Liabilities now or hereafter existing under this
Agreement and the other Loan Documents and shall remain in full force and
effect until payment in full of all Guaranteed Liabilities and other amounts
payable hereunder and until this Agreement is no longer in effect or, if
earlier, when the Guarantor has given the Administrative Agent written notice
that this Guarantee has been revoked; provided that any notice under
this Section shall not 

 

50

 

release the revoking Guarantor
from any Guaranteed Liability, absolute or contingent, existing prior to the
Administrative Agent’s actual receipt of the notice at its branches or
departments responsible for this Agreement and reasonable opportunity to act
upon such notice.

 

Section 8.04.                             Reinstatement.  This Guarantee shall continue to be effective
or be reinstated, as the case may be, if at any time any payment of any of the
Guaranteed Liabilities is rescinded or must otherwise be returned by
Administrative Agent or any Lender on the insolvency, bankruptcy or
reorganization of the Borrower, or any other Credit Party, or otherwise, all as
though the payment had not been made.

 

Section 8.05.                             Subrogation.  No Guarantor shall exercise any rights which
it may acquire by way of subrogation, by any payment made under this Guarantee
or otherwise, until all the Guaranteed Liabilities have been paid in full and
this Agreement is no longer in effect.  If
any amount is paid to the Guarantor on account of subrogation rights under this
Guarantee at any time when all the Guaranteed Liabilities have not been paid in
full, the amount shall be held in trust for the benefit of the Lenders and
shall be promptly paid to the Administrative Agent to be credited and applied
to the Guaranteed Liabilities, whether matured or unmatured or absolute or
contingent, in accordance with the terms of this Agreement.  If any Guarantor makes payment to the
Administrative Agent or any Lender of all or any part of the Guaranteed
Liabilities and all the Guaranteed Liabilities are paid in full and this
Agreement is no longer in effect, the Administrative Agent and the Lenders
shall, at such Guarantor’s request, execute and deliver to such Guarantor
appropriate documents, without recourse and without representation or warranty,
necessary to evidence the transfer by subrogation to such Guarantor of an
interest in the Guaranteed Liabilities resulting from the payment.

 

Section 8.06.                             Subordination.  Without limiting the rights of the
Administrative Agent and the Lenders under any other agreement, any liabilities
owed by the Borrower to any Guarantor in connection with any extension of
credit or financial accommodation by any Guarantor to or for the account of the
Borrower, including but not limited to interest accruing at the agreed contract
rate after the commencement of a bankruptcy or similar proceeding, are hereby
subordinated to the Guaranteed Liabilities, and such liabilities of the
Borrower to such Guarantor, if the Administrative Agent so requests, shall be
collected, enforced and received by any Guarantor as trustee for the
Administrative Agent and shall be paid over to the Administrative Agent on
account of the Guaranteed Liabilities but without reducing or affecting in any
manner the liability of the Guarantor under the other provisions of this
Guarantee.

 

Section 8.07.                             Payments Generally.  All payments by the Guarantors shall be made
in the manner, at the place and in the currency (the “Payment Currency”)
required by the Loan Documents; provided, however, that (if the
Payment Currency is other than Dollars) any Guarantor may, at its option (or,
if for any reason whatsoever any Guarantor is unable to effect payments in the
foregoing manner, such Guarantor shall be obligated to) pay to the
Administrative Agent at its principal office the equivalent amount in Dollars
computed at the selling rate of the Administrative Agent or a selling rate
chosen by the Administrative Agent, most recently in effect on or prior to the
date the Guaranteed Liability becomes due, for cable transfers of the Payment
Currency to the place where the Guaranteed Liability is payable.  In any case in which any Guarantor makes or
is obligated to make payment in Dollars, the Guarantor shall hold the Administrative
Agent and the Lenders harmless from any loss incurred by the 

 

51

 

Administrative Agent or any
Lender arising from any change in the value of Dollars in relation to the
Payment Currency between the date the Guaranteed Liability becomes due and the
date the Administrative Agent or such Lender is actually able, following the
conversion of the Dollars paid by such Guarantor into the Payment Currency and
remittance of such Payment Currency to the place where such Guaranteed
Liability is payable, to apply such Payment Currency to such Guaranteed
Liability.

 

Section 8.08.                             Setoff.  Each Guarantor agrees that, in addition to
(and without limitation of) any right of setoff, banker’s lien or counterclaim
the Administrative Agent or any Lender may otherwise have, the Administrative
Agent or such Lender shall be entitled, at its option, to offset balances
(general or special, time or demand, provisional or final) held by it for the
account of any Guarantor at any office of the Administrative Agent or such
Lender, in Dollars or in any other currency, against any amount payable by such
Guarantor under this Guarantee which is not paid when due (regardless of
whether such balances are then due to such Guarantor), in which case it shall
promptly notify such Guarantor thereof; provided that the failure of the
Administrative Agent or such Lender to give such notice shall not affect the
validity thereof.

 

Section 8.09.                             Formalities.  Each Guarantor waives presentment, notice of
dishonor, protest, notice of acceptance of this Guarantee or incurrence of any
Guaranteed Liability and any other formality with respect to any of the
Guaranteed Liabilities or this Guarantee.

 

Section 8.10.                             Limitations on
Guarantee.  The provisions of the
Guarantee under this Article VIII are severable, and in any action or
proceeding involving any state corporate law, or any state, federal or foreign
bankruptcy, insolvency, reorganization or other law affecting the rights of
creditors generally, if the obligations of any Guarantor under this Guarantee
would otherwise be held or determined to be avoidable, invalid or unenforceable
on account of the amount of such Guarantor’s liability under this Guarantee,
then, notwithstanding any other provision of this Guarantee to the contrary,
the amount of such liability shall, without any further action by the
Guarantors, the Administrative Agent or any Lender, be automatically limited
and reduced to the highest amount that is valid and enforceable as determined in
such action or proceeding (such highest amount determined hereunder being the
relevant Guarantor’s “Maximum Liability”).  This Section 8.10 with respect to the
Maximum Liability of the Guarantors is intended solely to preserve the rights
of the Administrative Agent and Lenders hereunder to the maximum extent not
subject to avoidance under applicable law, and no Guarantor nor any other
Person shall have any right or claim under this Section 8.10 with respect
to the Maximum Liability, except to the extent necessary so that none of the
obligations of any Guarantor hereunder shall be rendered voidable under
applicable law.

 

Article IX

 

Events of
Default

 

If any of the
following events (“Events of Default”) shall occur:

 

52

 

(a)                                  the
Borrower shall fail to pay any principal of any Loan when and as the same shall
become due and payable, whether at the due date thereof or at a date fixed for
prepayment thereof or otherwise;

 

(b)                                 the
Borrower shall fail to pay any interest on any Loan or any fee or any other
amount (other than an amount referred to in clause (a) of this Article)
payable under this Agreement, when and as the same shall become due and
payable, and such failure shall continue unremedied for a period of three (3) days;

 

(c)                                  any
representation or warranty made or deemed made by or on behalf of the Borrower
or any Restricted Subsidiary in or in connection with this Agreement or any
amendment or modification hereof or waiver hereunder, or in any report, certificate,
financial statement or other document furnished pursuant to or in connection
with this Agreement or any amendment or modification hereof or waiver hereunder
or in any Loan Document furnished pursuant to or in connection with this
Agreement or any amendment or modification thereof or waiver hereunder, shall
prove to have been incorrect in any material respect when made or deemed made;

 

(d)                                 the
Borrower or any Restricted Subsidiary shall fail to observe or perform any
covenant, condition or agreement contained in Section 2.10, Section 6.01, Section 6.02, Section 6.03
(with respect to the Borrower or any Restricted Subsidiary’s existence), Section 6.05
(with respect to insurance), Section 6.08, or in Article VII;

 

(e)                                  the
Borrower or any Restricted Subsidiary shall fail to observe or perform any
covenant, condition or agreement contained in this Agreement (other than those
specified in clause (a), (b) or (d) of this Article) or any Loan
Document, and such failure shall continue unremedied for a period of thirty
(30) days after notice thereof from the Administrative Agent to the
Borrower (which notice will be given at the request of any Lender);

 

(f)                                    the
Borrower or any Restricted Subsidiary shall fail to make any payment
(whether of principal or interest and regardless of amount) in respect of any
Material Indebtedness, when and as the same shall become due and payable;

 

(g)                                 any
event or condition occurs that results in any Material Indebtedness becoming
due prior to its scheduled maturity; provided that this clause (g) shall
not apply to secured Indebtedness that becomes due as a result of the voluntary
sale or transfer of the property or assets securing such Indebtedness;

 

(h)                                 an
involuntary proceeding shall be commenced or an involuntary petition shall be filed
seeking (i) liquidation, reorganization or other relief in respect of the
Borrower or any Restricted Subsidiary or its debts, or of a substantial part of
its assets, under any Federal, state or foreign bankruptcy, insolvency,
receivership or similar law now or hereafter in effect or (ii) the
appointment of a receiver, trustee, custodian, sequestrator, conservator or
similar official for the Borrower or any Restricted Subsidiary or for a
substantial part of its assets, and, in any such case, such proceeding or
petition 

 

53

 

shall continue undismissed for
sixty (60) days or an order or decree approving or ordering any of the
foregoing shall be entered;

 

(i)                                     the
Borrower or any Restricted Subsidiary shall (i) voluntarily commence any
proceeding or file any petition seeking liquidation, reorganization or other
relief under any Federal, state or foreign bankruptcy, insolvency, receivership
or similar law now or hereafter in effect, (ii) consent to the institution
of, or fail to contest in a timely and appropriate manner, any proceeding or
petition described in clause (h) of this Article, (iii) apply for or
consent to the appointment of a receiver, trustee, custodian, sequestrator,
conservator or similar official for the Borrower or any Restricted Subsidiary
or for a substantial part of its assets, (iv) file an answer admitting the
material allegations of a petition filed against it in any such proceeding, (v) make
a general assignment for the benefit of creditors or (vi) take any action
for the purpose of effecting any of the foregoing;

 

(j)                                     the
Borrower or any Restricted Subsidiary shall become unable, admit in writing its
inability or fail generally to pay its debts as they become due;

 

(k)                                  one
or more judgments for the payment of money in an aggregate amount in excess of
$50,000,000 shall be rendered against the Borrower or any Restricted Subsidiary
or any combination thereof and the same shall remain undischarged for a period
of thirty (30) consecutive days during which execution shall not be
effectively stayed, or any action shall be legally taken by a judgment creditor
to attach or levy upon any assets of the Borrower or any Restricted Subsidiary
to enforce any such judgment;

 

(l)                                   an
ERISA Event shall have occurred that, in the opinion of the Required Lenders,
when taken together with all other ERISA Events that have occurred, could
reasonably be expected to result in a Material Adverse Effect;

 

(m)                             the
delivery by any Guarantor to the Administrative Agent of written notice that
its Guarantee under Article VIII has been revoked or is otherwise declared
invalid or unenforceable;

 

(n)                               a
Change of Control shall occur;

 

then, and in
every such event (other than an event with respect to the Borrower or any
Restricted Subsidiary described in clause (h) or (i) of this
Article), and at any time thereafter during the continuance of such event, the
Administrative Agent may, and at the request of the Required Lenders shall, by
notice to the Borrower, declare the Loans then outstanding to be due and
payable in whole (or in part, in which case any principal not so declared to be
due and payable may thereafter be declared to be due and payable), and
thereupon the principal of the Loans so declared to be due and payable, together
with accrued interest thereon and all fees and other obligations of the
Borrower accrued hereunder, shall become due and payable immediately, without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by the Borrower; and in case of any event with respect to the
Borrower described in clause (h) or (i) of this Article, the
principal of the Loans then outstanding, together with accrued interest thereon
and all fees and other obligations of the Borrower accrued hereunder, shall
automatically 

 

54

 

become due and
payable, without presentment, demand, protest or other notice of any kind, all
of which are hereby waived by the Borrower.

 

Article X

 

The
Administrative Agent

 

Each of the
Lenders hereby irrevocably appoints the Administrative Agent as its agent and
authorizes the Administrative Agent to take such actions on its behalf and to
exercise such powers as are delegated to the Administrative Agent by the terms
hereof, together with such actions and powers as are reasonably incidental
thereto.

 

The bank
serving as the Administrative Agent hereunder shall have the same rights and
powers in its capacity as a Lender as any other Lender and may exercise the
same as though it were not the Administrative Agent, and such bank and its
Affiliates may accept deposits from, lend money to and generally engage in any
kind of business with any Credit Party or other Affiliate thereof as if it were
not the Administrative Agent hereunder.

 

The
Administrative Agent shall not have any duties or obligations except those
expressly set forth herein.  Without
limiting the generality of the foregoing, (a) the Administrative Agent
shall not be subject to any fiduciary or other implied duties, regardless of
whether a Default has occurred and is continuing, (b) the Administrative
Agent shall not have any duty to take any discretionary action or exercise any
discretionary powers, except discretionary rights and powers expressly
contemplated hereby that the Administrative Agent is required to exercise in
writing as directed by the Required Lenders (or such other number or percentage
of the Lenders as shall be necessary under the circumstances as provided in Section 11.02),
and (c) except as expressly set forth herein, the Administrative Agent
shall not have any duty to disclose, and shall not be liable for the failure to
disclose, any information relating to any Credit Party that is communicated to
or obtained by the bank serving as Administrative Agent or any of its
Affiliates in any capacity.  The
Administrative Agent shall not be liable for any action taken or not taken by
it with the consent or at the request of the Required Lenders (or such other
number or percentage of the Lenders as shall be necessary under the
circumstances as provided in Section 11.02) or in the absence of its own
gross negligence or willful misconduct. 
The Administrative Agent shall be deemed not to have knowledge of any
Default unless and until written notice thereof is given to the Administrative
Agent by the Borrower or a Lender, and the Administrative Agent shall not be
responsible for or have any duty to ascertain or inquire into (i) any
statement, warranty or representation made in or in connection with this
Agreement, (ii) the contents of any certificate, report or other document
delivered hereunder or in connection herewith, (iii) the performance or
observance of any of the covenants, agreements or other terms or conditions set
forth herein, (iv) the validity, enforceability, effectiveness or
genuineness of this Agreement or any other agreement, instrument or document,
or (v) the satisfaction of any condition set forth in Article V or
elsewhere herein, other than to confirm receipt of items expressly required to
be delivered to the Administrative Agent.

 

The
Administrative Agent shall be entitled to rely upon, and shall not incur any
liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing believed by it to be genuine
and to have been signed or sent by the proper Person.  

 

55

 

The
Administrative Agent also may rely upon any statement made to it orally or by
telephone and believed by it to be made by the proper Person, and shall not
incur any liability for relying thereon. 
The Administrative Agent may consult with legal counsel (who may be
counsel for the Borrower), independent accountants and other experts selected
by it, and shall not be liable for any action taken or not taken by it in
accordance with the advice of any such counsel, accountants or experts.

 

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

 

Subject to the
appointment and acceptance of a successor Administrative Agent as provided in
this paragraph, the Administrative Agent may resign at any time by notifying
the Lenders and the Borrower.  Upon any
such resignation, the Required Lenders shall have the right, in consultation
with the Borrower, to appoint a successor. 
If no successor shall have been so appointed by the Required Lenders and
shall have accepted such appointment within 30 days after the retiring
Administrative Agent gives notice of its resignation, then the retiring
Administrative Agent may, on behalf of the Lenders appoint a successor
Administrative Agent which shall be a bank with an office in Chicago, Illinois
or New York, New York, or an Affiliate of any such bank.  Upon the acceptance of its appointment as
Administrative Agent hereunder by a successor, such successor shall succeed to
and become vested with all the rights, powers, privileges and duties of the
retiring Administrative Agent, and the retiring Administrative Agent shall be
discharged from its duties and obligations hereunder.  The fees payable by the Borrower to a
successor Administrative Agent shall be the same as those payable to its
predecessor unless otherwise agreed between the Borrower and such
successor.  After the Administrative
Agent’s resignation hereunder, the provisions of this Article and Section 11.03
shall continue in effect for the benefit of such retiring Administrative Agent,
its sub-agents and their respective Related Parties in respect of any actions
taken or omitted to be taken by any of them while it was acting as
Administrative Agent.

 

Each Lender
acknowledges that it has, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and information
as it has deemed appropriate, made its own credit analysis and decision to
enter into this Agreement.  Each Lender
also acknowledges that it will, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and
information as it shall from time to time deem appropriate, continue to make
its own decisions in taking or not taking action under or based upon this
Agreement, any related agreement or any document furnished hereunder or
thereunder.

 

56

 

Article XI

 

Miscellaneous

 

Section 11.01.                       Notices.

 

(a)                                  Except
in the case of notices and other communications expressly permitted to be given
by telephone (and subject to paragraph (b) below), all notices and other
communications provided for herein shall be in writing and shall be delivered
by hand or overnight courier service, mailed by certified or registered mail or
sent by telecopy, as follows:

 

(i)                                     if
to the Borrower, to EXCO Partners Operating Partnership, LP, c/o EXCO Resources, Inc.,
12377 Merit Drive, Suite 1700, Dallas, Texas 75251, Attention:  Douglas H. Miller, Chief Executive Officer
and Attention:  J. Douglas Ramsey, Chief
Financial Officer, Telecopy No. (214) 368-2087;

 

(ii)                                  if
to the Administrative Agent to JPMorgan Chase Bank, N.A., JPMorgan Loan
Services, 21 South Clark St., 19th Floor, Chicago, Illinois 60603-2003,
Telecopy No.: (312) 385-7096, Attention: Claudia Kech, with a copy to JPMorgan
Chase Bank, N.A., 2200 Ross Avenue, 3rd Floor, TX1-2448, Dallas,
Texas 75201, Telecopy No. (214) 965-3280, Attention:  Wm. Mark Cranmer, Senior Vice President; and

 

(iii)                               if
to any other Lender, to it at its address (or telecopy number) set forth in its
Administrative Questionnaire.

 

(b)                                 Notices
and other communications to the Lenders 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.  The
Administrative Agent or the Borrower may, in their 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 11.02.                       Waivers; Amendments.

 

(a)                                  No
failure or delay by the Administrative Agent or any Lender in exercising any
right or power hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power.  The rights and remedies of 

 

57

 

the Administrative Agent and
the Lenders hereunder are cumulative and are not exclusive of any rights or
remedies that they would otherwise have. 
No waiver of any provision of this Agreement or consent to any departure
by the Borrower therefrom shall in any event be effective unless the same shall
be permitted by paragraph (b) of this Section, and then such waiver
or consent shall be effective only in the specific instance and for the purpose
for which given.  Without limiting the
generality of the foregoing, the making of a Loan shall not be construed as a
waiver of any Default, regardless of whether the Administrative Agent or any
Lender may have had notice or knowledge of such Default at the time.

 

(b)                                 Neither
this Agreement nor any provision hereof may be waived, amended or modified
except pursuant to an agreement or agreements in writing entered into by the
Credit Parties and the Required Lenders or by the Credit Parties and the
Administrative Agent with the consent of the Required Lenders; provided
that no such agreement shall (1) increase the Commitment of any Lender
without the written consent of such Lender, (2) reduce the principal
amount of any Loan or reduce the rate of interest thereon, or reduce any fees
payable hereunder, without the written consent of each Lender affected thereby,
(3) postpone the scheduled date of payment of the principal amount of any
Loan or any interest thereon, or any fees payable hereunder, or reduce the
amount of, waive or excuse any such payment, or postpone the Maturity Date,
without the written consent of each Lender affected thereby, (4) change Section 2.17(b) or
Section 2.17(c) in a manner that would alter the pro rata sharing of
payments required thereby, without the written consent of each Lender, (5) release
any Credit Party from its obligations under the Loan Documents, except in
connection with any sales, transfers, leases or other dispositions permitted in
Section 7.03, or (6) change any of the provisions of this Section or
the definition of “Required Lenders” or any other provision hereof specifying
the number or percentage of Lenders required to waive, amend or modify any
rights hereunder or make any determination or grant any consent hereunder,
without the written consent of each Lender; provided  further that
no such agreement shall amend, modify or otherwise affect the rights or duties
of the Administrative Agent hereunder without the prior written consent of the
Administrative Agent.

 

Section 11.03.                       Expenses; Indemnity; Damage
Waiver.

 

(a)                                  The
Borrower shall pay (i) all reasonable out-of-pocket expenses incurred by
the Administrative Agent and its Affiliates, including the reasonable fees,
charges and disbursements of counsel for the Administrative Agent, in
connection with the syndication of the credit facilities provided for herein,
the preparation and administration of this Agreement and the other Loan
Documents or any amendments, modifications or waivers of the provisions hereof
(whether or not the transactions contemplated hereby or thereby shall be
consummated) and (ii) all out-of-pocket expenses incurred by the
Administrative Agent or any Lender, including the fees, charges and
disbursements of any counsel for the Administrative Agent or any Lender, in
connection with the enforcement or protection of its rights in connection with
the Loan Documents, including its rights under this Section, or in connection
with the Loans made hereunder, including all such out-of-pocket expenses
incurred during any workout, restructuring or negotiations in respect of such
Loans.

 

58

 

(b)           THE CREDIT PARTIES SHALL INDEMNIFY THE ADMINISTRATIVE
AGENT AND EACH LENDER, AND EACH RELATED PARTY OF ANY OF THE FOREGOING PERSONS
(EACH SUCH PERSON BEING CALLED AN “INDEMNITEE”) AGAINST, AND HOLD EACH
INDEMNITEE HARMLESS FROM, ANY AND ALL LOSSES, CLAIMS, DAMAGES, PENALTIES,
LIABILITIES AND RELATED EXPENSES, INCLUDING THE FEES, CHARGES AND DISBURSEMENTS
OF ANY COUNSEL FOR ANY INDEMNITEE, INCURRED BY OR ASSERTED AGAINST ANY
INDEMNITEE ARISING OUT OF, IN CONNECTION WITH, OR AS A RESULT OF (I) THE
EXECUTION OR DELIVERY OF THIS AGREEMENT OR ANY AGREEMENT OR INSTRUMENT
CONTEMPLATED HEREBY, THE PERFORMANCE BY THE PARTIES HERETO OF THEIR RESPECTIVE
OBLIGATIONS HEREUNDER OR THE CONSUMMATION OF THE TRANSACTIONS OR ANY OTHER
TRANSACTIONS CONTEMPLATED HEREBY, (II) ANY LOAN OR THE USE OF THE PROCEEDS
THEREFROM, (III) ANY ACTUAL OR ALLEGED PRESENCE OR RELEASE OF HAZARDOUS
MATERIALS ON OR FROM ANY PROPERTY OWNED OR OPERATED BY THE BORROWER OR ANY
SUBSIDIARY, OR ANY ENVIRONMENTAL LIABILITY RELATED IN ANY WAY TO THE BORROWER
OR ANY SUBSIDIARY, OR (IV) ANY ACTUAL OR PROSPECTIVE CLAIM, LITIGATION,
INVESTIGATION OR PROCEEDING RELATING TO ANY OF THE FOREGOING, WHETHER BASED ON
CONTRACT, TORT OR ANY OTHER THEORY AND REGARDLESS OF WHETHER ANY INDEMNITEE IS
A PARTY THERETO; PROVIDED THAT SUCH INDEMNITY SHALL NOT, AS TO ANY
INDEMNITEE, BE AVAILABLE TO THE EXTENT THAT SUCH LOSSES, CLAIMS, DAMAGES,
LIABILITIES OR RELATED EXPENSES ARE DETERMINED BY A COURT OF COMPETENT
JURISDICTION BY FINAL AND NONAPPEALABLE JUDGMENT TO HAVE RESULTED FROM THE
GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH INDEMNITEE.

 

(c)           To the extent that any
Credit Party fails to pay any amount required to be paid by it to the
Administrative Agent under paragraph (a) or (b) of this Section, each
Lender severally agrees to pay to the Administrative Agent, such Lender’s
Applicable Percentage (in each case, determined as of the time that the
applicable unreimbursed expense or indemnity payment is sought) of such unpaid
amount; provided that the unreimbursed expense or indemnified loss,
claim, damage, liability or related expense, as the case may be, was incurred
by or asserted against the Administrative Agent in its capacity as such.

 

(d)           TO THE MAXIMUM EXTENT
PERMITTED BY APPLICABLE LAW, THE CREDIT PARTIES SHALL NOT ASSERT, AND HEREBY
WAIVE, ANY CLAIM AGAINST ANY INDEMNITEE, ON ANY THEORY OF LIABILITY, FOR
SPECIAL, INDIRECT, CONSEQUENTIAL OR PUNITIVE DAMAGES (AS OPPOSED TO DIRECT OR
ACTUAL DAMAGES) ARISING OUT OF, IN CONNECTION WITH, OR AS A RESULT OF, THIS
AGREEMENT OR ANY AGREEMENT OR INSTRUMENT CONTEMPLATED HEREBY, THE 

 

59

 

TRANSACTIONS,
ANY LOAN OR LETTER OF CREDIT OR THE USE OF THE PROCEEDS THEREOF.

 

(e)       All
amounts due under this Section shall be payable not later than ten (10) days
after written demand therefor.

 

Section 11.04.            Successors
and Assigns.

 

(a)    The
provisions of this Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns permitted
hereby, except that (i) no Credit Party may assign or otherwise transfer
any of its rights or obligations hereunder without the prior written consent of
each Lender (and any attempted assignment or transfer by such Credit Party
without such consent shall be null and void) and (ii) no Lender may assign
or otherwise transfer its rights or obligations hereunder except in accordance
with this Section.  Nothing in this
Agreement, expressed or implied, shall be construed to confer upon any Person
(other than the parties hereto, their respective successors and assigns
permitted hereby, Participants (to the extent provided in paragraph (c) of
this Section) and, to the extent expressly contemplated hereby, the Related
Parties of each of the Administrative Agent and the Lenders) any legal or
equitable right, remedy or claim under or by reason of this Agreement.

 

(b)

 

(i)            Subject to the
conditions set forth in paragraph (b)(ii) below, any Lender may assign to
one or more assignees all or a portion of its rights and obligations under this
Agreement (including all or a portion of the Loans at the time owing to it)
with the prior written consent (such consent not to be unreasonably withheld)
of:

 

(A)          the Borrower, provided
that no consent of the Borrower shall be required for an assignment to a
Lender, an Affiliate of a Lender, a Federal Reserve Bank, an Approved Fund or,
if an Event of Default has occurred and is continuing, any other assignee; and

 

(B)           the Administrative
Agent, provided that no consent of the Administrative Agent shall be
required for an assignment to a Lender, an Affiliate of a Lender or an Approved
Fund.

 

(ii)           Assignments shall be
subject to the following additional conditions:

 

(A)          except in the case of an
assignment to a Lender, an Affiliate of a Lender, an Approved Fund or an
assignment of the entire remaining amount of the assigning Lender’s Loans, the
amount of the Loans of the assigning Lender subject to each such assignment
(determined as of the date the Assignment and Assumption with respect to such
assignment is delivered to the Administrative Agent) shall not be less than
$1,000,000 unless each of the Borrower and the Administrative Agent otherwise 

 

60

 

consent, provided that
no such consent of the Borrower shall be required if an Event of Default has
occurred and is continuing;

 

(B)                              each
partial assignment shall be made as an assignment of a proportionate part of
all the assigning Lender’s rights and obligations in respect of such Lender’s
Loans under this Agreement;

 

(C)                              the
parties to each assignment shall execute and deliver to the Administrative
Agent an Assignment and Assumption, together with a processing and recordation
fee of $3,500; and

 

(D)                             the
assignee, if it shall not be a Lender, shall deliver to the Administrative
Agent an Administrative Questionnaire.

 

For the
purposes of this Section 11.04(b), 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.

 

(iii)          Subject to acceptance
and recording thereof pursuant to paragraph (b)(iv) of this Section,
from and after the effective date specified in each Assignment and Assumption
the assignee thereunder shall be a party hereto and, to the extent of the
interest assigned by such Assignment and Assumption, have the rights and
obligations of a Lender under this Agreement, and the assigning Lender
thereunder shall, to the extent of the interest assigned by such Assignment and
Assumption, be released from its obligations under this Agreement (and, in the
case of an Assignment and Assumption covering all of the assigning Lender’s
rights and obligations under this Agreement, such Lender shall cease to be a
party hereto but shall continue to be entitled to the benefits of Section 2.14,
Section 2.15, Section 2.16 and Section 11.03).  Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with this Section 11.04
shall be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with paragraph (c) of
this Section except that any attempted assignment or transfer by any
Lender that does not comply with clause (C) of Section 11.04(b)(ii) shall
be null and void.

 

(iv)          The Administrative
Agent, acting for this purpose as an agent of the Borrower, shall maintain at
one of its offices a copy of each Assignment and Assumption delivered to it and
a register for the recordation of the names and addresses of the Lenders, and
the principal amount of the Loans owing to each Lender pursuant to the terms
hereof from time to time (the “Register”).  The entries in the Register shall be
conclusive, and the Credit Parties, the 

 

61

 

Administrative Agent and the
Lenders may treat each Person whose name is recorded in the Register pursuant
to the terms hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. 
The Register shall be available for inspection by the Credit Parties and
any Lender, at any reasonable time and from time to time upon reasonable prior
notice.

 

(v)           Upon its receipt of a
duly completed Assignment and Assumption executed by an assigning Lender and an
assignee, the assignee’s completed Administrative Questionnaire (unless the
assignee shall already be a Lender hereunder), the processing and recordation
fee referred to in paragraph (b) of this Section any written
consent to such assignment required by paragraph (b) of this Section, the
Administrative Agent shall accept such Assignment and Assumption and record the
information contained therein in the Register; provided that if either
the assigning Lender or the assignee shall have failed to make any payment
required to be made by it pursuant to Section 2.06, Section 2.17(d) or
Section 11.03(c), the Administrative Agent shall have no obligation to
accept such Assignment and Assumption and record the information therein in the
Register unless and until such payment shall have been made in full, together
with all accrued interest thereon.  No
assignment shall be effective for purposes of this Agreement unless it has been
recorded in the Register as provided in this paragraph.

 

(c)

 

(i)            Any Lender may,
without the consent of the Borrower or the Administrative Agent, sell
participations to one or more banks or other entities (a “Participant”)
in all or a portion of such Lender’s rights and obligations under this
Agreement (including all or a portion of the Loans owing to it); provided
that (A) such Lender’s obligations under this Agreement shall remain
unchanged, (B) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations and (C) the Borrower,
the Administrative Agent and the other Lenders shall continue to deal solely
and directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement.  Any
agreement or instrument pursuant to which a Lender sells such a participation
shall provide that such Lender shall retain the sole right to enforce this
Agreement and to approve any amendment, modification or waiver of any provision
of this Agreement; provided that such agreement or instrument may
provide that such Lender will not, without the consent of the Participant,
agree to any amendment, modification or waiver described in the first proviso
to Section 11.02(b) that affects such Participant.  Subject to paragraph (c)(ii) of this Section,
the Borrower agrees that each Participant shall be entitled to the benefits of Section 2.14,
Section 2.15 and Section 2.16 to the same extent as if it were a
Lender and had acquired its interest by assignment pursuant to paragraph (b) of
this Section.  To the extent permitted by
law, each Participant also shall be entitled to the benefits of Section 11.08
as though it were a Lender, provided such Participant agrees to be subject to Section 2.17(c) as
though it were a Lender.

 

62

 

(ii)           A Participant shall not
be entitled to receive any greater payment under Section 2.14 or Section 2.16
than the applicable Lender would have been entitled to receive with respect to
the participation sold to such Participant, unless the sale of the participation
to such Participant is made with the prior written consent of the
Borrower.  A Participant that would be a
Foreign Lender if it were a Lender shall not be entitled to the benefits of Section 2.16
unless the Borrower is notified of the participation sold to such Participant
and such Participant agrees, for the benefit of the Borrower, to comply with Section 2.16(e) as
though it were a Lender.

 

(d)           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 without
limitation 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 11.05.        Survival.  All covenants, agreements, representations
and warranties made by the Credit Parties herein and in the certificates or
other instruments delivered in connection with or pursuant to this Agreement
shall be considered to have been relied upon by the other parties hereto and
shall survive the execution and delivery of this Agreement and the making of
any Loans, regardless of any investigation made by any such other party or on
its behalf and notwithstanding that the Administrative Agent or any Lender may
have had notice or knowledge of any Default or incorrect representation or
warranty at the time any credit is extended hereunder, and shall continue in
full force and effect as long as the principal of or any accrued interest on
any Loan or any fee or any other amount payable under this Agreement is
outstanding and unpaid.  The provisions
of Section 2.14, Section 2.15, Section 2.16 and Section 11.03
and Article X shall survive and remain in full force and effect regardless
of the consummation of the transactions contemplated hereby, the repayment of
the Loans or the termination of this Agreement or any provision hereof.

 

Section 11.06.        Counterparts; Integration; Effectiveness.  This Agreement may be executed in
counterparts (and by different parties hereto on different counterparts), each
of which shall constitute an original, but all of which when taken together
shall constitute a single contract.  This
Agreement and any separate letter agreements with respect to fees payable to
the Administrative Agent constitute the entire contract among the parties
relating to the subject matter hereof and supersede any and all previous
agreements and understandings, oral or written, relating to the subject matter
hereof.  THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT
BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.  THERE ARE NO UNWRITTEN ORAL AGREEMENTS
BETWEEN THE PARTIES.  Except
as provided in Section 5.01, this Agreement shall become effective when it
shall have been executed by the Administrative Agent and when the
Administrative Agent shall have received counterparts hereof which, when taken
together, bear the signatures of each of the other parties hereto, and
thereafter shall be binding upon and inure to the benefit of the parties 

 

63

 

hereto and their respective
successors and assigns.  Delivery of an
executed counterpart of a signature page of this Agreement by telecopy
shall be effective as delivery of a manually executed counterpart of this
Agreement.

 

Section 11.07.        Severability.  Any provision of this Agreement held to be
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof; and the invalidity of a particular provision
in a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.

 

Section 11.08.        Right of Setoff.  If an Event of Default shall have occurred
and be continuing, each Lender and each of its Affiliates is hereby authorized
at any time and from time to time, to the fullest extent permitted by law, to
set off and apply any and all deposits (general or special, time or demand,
provisional or final) at any time held and other obligations at any time owing
by such Lender or Affiliate to or for the credit or the account of the Borrower
against any of and all the obligations of any Credit Party now or hereafter
existing under this Agreement held by such Lender, irrespective of whether or
not such Lender shall have made any demand under this Agreement and although
such obligations may be unmatured.  The
rights of each Lender under this Section and Section 8.08 are in
addition to other rights and remedies (including other rights of setoff) which
such Lender may have.

 

Section 11.09.      GOVERNING
LAW; JURISDICTION; CONSENT TO SERVICE OF PROCESS.

 

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

 

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

 

64

 

(c)                                  EACH
CREDIT PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST
EXTENT IT MAY LEGALLY AND EFFECTIVELY DO SO, ANY OBJECTION WHICH IT MAY NOW
OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT IN ANY COURT REFERRED TO IN
PARAGRAPH (B) OF THIS SECTION.  EACH
OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF
SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.

 

(d)                                 EACH
PARTY TO THIS AGREEMENT IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE
MANNER PROVIDED FOR NOTICES IN SECTION 11.01.  NOTHING IN THIS AGREEMENT WILL AFFECT THE
RIGHT OF ANY PARTY TO THIS AGREEMENT TO SERVE PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW.

 

Section 11.10.                       WAIVER
OF JURY TRIAL.  EACH PARTY HERETO
HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT
OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER
BASED ON CONTRACT, TORT OR ANY OTHER THEORY). 
EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO
HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE
MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

 

Section 11.11.                       Headings.  Article and Section headings and
the Table of Contents used herein are for convenience of reference only, are
not part of this Agreement and shall not affect the construction of, or be
taken into consideration in interpreting, this Agreement.

 

Section 11.12.                       Confidentiality.  Each of the Administrative Agent 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 any self-regulatory
authority or agency possessing investigative powers and the ability to sanction
members for non-compliance, (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 the enforcement of rights hereunder, (f) subject to an agreement containing
provisions substantially the same as, or otherwise consistent with, those of
this Section, to (i) any assignee of or Participant in, or any prospective
assignee of or Participant in, 

 

65

 

any of its rights or
obligations under this Agreement or (ii)  any actual or prospective
counterparty (or its advisors) to any swap or derivative transaction relating
to the Credit Parties and their obligations, (g) with the consent of the
Borrower or (h) to the extent such Information (i) becomes publicly
available other than as a result of a breach of this Section or (ii) becomes
available to the Administrative Agent or any Lender on a nonconfidential basis
from a source other than a Credit Party. 
For the purposes of this Section, “Information” means all
information received from any Credit Party relating to any Credit Party or its
business, other than any such information that is available to the
Administrative Agent or any Lender on a nonconfidential basis prior to
disclosure by any Credit Party; provided that, in the case of
information received from any Credit Party after the date hereof, such
information is clearly identified at the time of delivery as confidential.  Any Person required to maintain the confidentiality
of Information as provided in this Section shall be considered to have
complied with its obligation to do so if such Person has exercised the same
degree of care to maintain the confidentiality of such Information as such
Person would accord to its own confidential information.

 

Section 11.13.        Interest Rate Limitation.  Notwithstanding anything herein to the
contrary, if at any time the interest rate applicable to any Loan, together
with all fees, charges and other amounts which are treated as interest on such
Loan under applicable law (collectively the “Charges”), shall exceed the
maximum lawful rate (the “Maximum Rate”) which may be contracted for,
charged, taken, received or reserved by the Lender holding such Loan in
accordance with applicable law, the rate of interest payable in respect of such
Loan hereunder, together with all Charges payable in respect thereof, shall be
limited to the Maximum Rate and, to the extent lawful, the interest and Charges
that would have been payable in respect of such Loan but were not payable as a
result of the operation of this Section shall be cumulated and the
interest and Charges payable to such Lender in respect of other Loans or
periods shall be increased (but not above the Maximum Rate therefor) until such
cumulated amount, together with interest thereon at the Federal Funds Effective
Rate to the date of repayment, shall have been received by such Lender.  Chapter 346 of the Texas Finance Code (which
regulates certain revolving credit accounts (formerly TEX. REV. CIV. STAT. ANN.
Art. 5069, Ch. 15)) shall not apply to this Agreement or to any Loan, nor
shall this Agreement or any Loan be governed by or be subject to the provisions
of such Chapter 346 in any manner whatsoever.

 

Section 11.14.        USA PATRIOT Act.  Each Lender that is subject to the
requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into
law October 26, 2001)) (the “Act”) hereby notifies each Credit Party that
pursuant to the requirements of the Act, it is required to obtain, verify and
record information that identifies each Credit Party, which information
includes the name and address of each Credit Party and other information that
will allow such Lender to identify each Credit Party in accordance with the
Act.  The Borrower shall, upon the
request of the Administrative Agent or any Lender, provide all documentation
and other information that the Administrative Agent or such Lender reasonably
requires to comply with its ongoing obligations under applicable “know your
customer” and anti-money laundering rules and regulations, including the
Act.

 

66

 

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

 

	
   

  	
  BORROWER:

  
	
   

  	
   

  
	
   

  	
  EXCO
  OPERATING COMPANY, LP

  
	
   

  	
  (formerly
  known as EXCO Partners Operating

  
	
   

  	
  Partnership,
  LP)

  
	
   

  	
   

  
	
   

  	
  By:

  	
  EXCO Partners OLP GP, LLC

  
	
   

  	
   

  	
  its sole general partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ J.
  Douglas Ramsey, Ph.D.

  
	
   

  	
   

  	
  Name:

  	
  J. Douglas Ramsey, Ph.D.

  
	
   

  	
   

  	
  Title:

  	
  Vice President and Chief Financial 

  
	
   

  	
   

  	
   

  	
  Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  GUARANTORS:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  GARRISON
  GATHERING, LLC

  
	
   

  	
  VAUGHAN
  DE, LLC

  
	
   

  	
  VAUGHAN
  HOLDING COMPANY, L.L.C.

  
	
   

  	
  VERNON
  GATHERING, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J.
  Douglas Ramsey, Ph.D.

  
	
   

  	
  Name:

  	
  J. Douglas Ramsey, Ph.D.

  
	
   

  	
  Title:

  	
  Vice President and Chief Financial Officer

  
	
   

  	
   

  	
  for each of the Credit Parties listed above

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  TALCO
  MIDSTREAM ASSETS, LTD.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  VAUGHAN HOLDING COMPANY, L.L.C.

  
	
   

  	
   

  	
  its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ J.
  Douglas Ramsey, Ph.D.

  
	
   

  	
   

  	
  Name:

  	
  J. Douglas Ramsey, Ph.D.

  
	
   

  	
   

  	
  Title:

  	
  Vice President and Chief Financial 

  
	
   

  	
   

  	
   

  	
  Officer

  
							

 

 

SIGNATURE PAGE

 

 

	
   

  	
  TGG
  PIPELINE, LTD.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  VAUGHAN HOLDING COMPANY, L.L.C.,

  
	
   

  	
   

  	
  its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ J.
  Douglas Ramsey, Ph.D.

  
	
   

  	
   

  	
  Name:

  	
  J. Douglas Ramsey, Ph.D.

  
	
   

  	
   

  	
  Title:

  	
  Vice President and Chief Financial 

  
	
   

  	
   

  	
   

  	
  Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  EXCO
  PRODUCTION COMPANY, LP 

  (formerly
  known as Winchester Production 

  Company,
  Ltd.)

  
	
   

  	
   

  
	
   

  	
  By:

  	
  VAUGHAN DE,
  LLC,

  
	
   

  	
   

  	
  Its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ J.
  Douglas Ramsey, Ph.D.

  
	
   

  	
   

  	
  Name:

  	
  J. Douglas Ramsey, Ph.D.

  
	
   

  	
   

  	
  Title:

  	
  Vice President and Chief Financial 

  
	
   

  	
   

  	
   

  	
  Officer

  
						

 

 

SIGNATURE PAGE

 

 

	
   

  	
  JPMORGAN CHASE BANK, N.A.,

  as a
  Lender and as Administrative Agent,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ William
  Mark Cranmer

  
	
   

  	
  Name:

  	
  Wm. Mark Cranmer

  
	
   

  	
  Title:

  	
  Senior Vice President

  
				

 

 

SIGNATURE PAGE

 

 

EXHIBIT A

 

ASSIGNMENT
AND ASSUMPTION

 

This
Assignment and Assumption (the “Assignment and Assumption”) is dated as
of the Effective Date set forth below and is entered into by and between
[Insert name of Assignor] (the “Assignor”) and [Insert name of Assignee]
(the “Assignee”).  Capitalized
terms used but not defined herein shall have the meanings given to them in the
Credit Agreement identified below  (as
amended, the “Credit Agreement”), receipt of a copy of which is hereby
acknowledged by the Assignee.  The
Standard Terms and Conditions set forth in Annex 1 attached hereto are
hereby agreed to and incorporated herein by reference and made a part of this
Assignment and Assumption as if set forth herein in full.

 

For an agreed
consideration, the Assignor hereby irrevocably sells and assigns to the
Assignee, and the Assignee hereby irrevocably purchases and assumes from the
Assignor, subject to and in accordance with the Standard Terms and Conditions
and the Credit Agreement, as of the Effective Date inserted by the
Administrative Agent as contemplated below (i) all of the Assignor’s
rights and obligations in its capacity as a Lender under the Credit Agreement
and any other documents or instruments delivered pursuant thereto to the extent
related to the amount and percentage interest identified below of all of such
outstanding rights and obligations of the Assignor under the respective loans
identified below (including any guarantees included in such loans) and (ii) to
the extent permitted to be assigned under applicable law, all claims, suits,
causes of action and any other right of the Assignor (in its capacity as a
Lender) against any Person, whether known or unknown, arising under or in
connection with the Credit Agreement, any other documents or instruments
delivered pursuant thereto or the loan transactions governed thereby or in any
way based on or related to any of the foregoing, including contract claims,
tort claims, malpractice claims, statutory claims and all other claims at law
or in equity related to the rights and obligations sold and assigned pursuant
to clause (i) above (the rights and obligations sold and assigned pursuant
to clauses (i) and (ii) above being referred to herein collectively
as the “Assigned Interest”).  Such
sale and assignment is without recourse to the Assignor and, except as
expressly provided in this Assignment and Assumption, without representation or
warranty by the Assignor.

 

	
  1.

  	
  Assignor:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  2.

  	
  Assignee:

  	
   

  	
   

  
	
   

  	
   

  	
  [and is an Affiliate/Approved Fund of
  [identify Lender]]

  
	
   

  	
   

  	
   

  
	
  3.

  	
  Borrower:

  	
  EXCO Operating Company, LP

  
	
   

  	
   

  	
   

  
	
  4.

  	
  Administrative Agent:

  	
  JPMorgan Chase Bank, N.A. (as the
  administrative agent under the Credit Agreement)

  
	
   

  	
   

  	
   

  
	
  5.

  	
  Credit Agreement:

  	
  Senior Unsecured Term Credit Agreement
  dated as of July 15, 2008 (as amended, restated, supplemented or
  otherwise modified from time to time) among EXCO Operating Company, LP, as
  Borrower, Certain Subsidiaries of Borrower, as Guarantors, the 

  

 

1

 

	
   

  	
   

  	
  Lenders parties thereto, and JPMorgan Chase
  Bank, N.A., as Administrative Agent

  
	
   

  	
   

  	
   

  
	
  6.

  	
  Assigned Interest:

  	
   

  

 

	
   

  	
   

  	
  Aggregate Amount 

  of Loans for all 

  Lenders

  	
   

  	
  Amount of Loans

  Assigned

  	
   

  	
  Applicable 

  Percentage of Loans

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
   

  	
  %

  
	
   

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
   

  	
  %

  
	
   

  	
   

  	
  $

  	
   

  	
  $

  	
   

  	
   

  	
  %

  

 

Effective
Date: 
                          
      , 20

 

The terms set
forth in this Assignment and Assumption are hereby agreed to:

 

	
   

  	
  ASSIGNOR

  
	
   

  	
   

  
	
   

  	
  [NAME OF
  ASSIGNOR]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ASSIGNEE

  
	
   

  	
   

  
	
   

  	
  [NAME OF
  ASSIGNEE]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  

 

2

 

[Consented to and] Accepted:

 

	
  JPMORGAN CHASE BANK, N.A.,

  as
  Administrative Agent

  
	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

 

[Consented to:]

 

 

	
  EXCO OPERATING COMPANY, LP

  
	
   

  
	
   

  
	
  By:

  	
  EXCO
  Partners OLP GP, LLC

  	
   

  
	
   

  	
  its
  sole general partner

  
	
   

  	
   

  

 

	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

3

 

ANNEX 1

 

Senior
Unsecured Term Credit Agreement dated as of July 15, 2008 (as amended,
restated, supplemented or otherwise modified from time to time) among EXCO
Operating Company, LP, as Borrower, Certain Subsidiaries of Borrower, as
Guarantors, the Lenders party thereto, and JPMorgan Chase Bank, N.A., as
Administrative Agent.

 

STANDARD TERMS AND CONDITIONS FOR

ASSIGNMENT AND ASSUMPTION

 

1.             Representations
and Warranties.

 

1.1.          Assignor.  The Assignor (a) represents and warrants
that (i) it is the legal and beneficial owner of the Assigned Interest, (ii) the
Assigned Interest is free and clear of any lien, encumbrance or other adverse
claim and (iii) it has full power and authority, and has taken all action
necessary, to execute and deliver this Assignment and Assumption and to
consummate the transactions contemplated hereby; and (b) assumes no
responsibility with respect to (i) any statements, warranties or
representations made in or in connection with the Credit Agreement or any other
Loan Document, (ii) the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Loan Documents or any collateral
thereunder, (iii) the financial condition of the Borrower, any Subsidiary
or Affiliates or any other Person obligated in respect of any Loan Document or (iv) the
performance or observance by the Borrower, any Subsidiary or Affiliates or any
other Person of any of their respective obligations under any Loan Document.

 

1.2.          Assignee.  The Assignee (a) represents and warrants
that (i) it has full power and authority, and has taken all action
necessary, to execute and deliver this Assignment and Assumption and to
consummate the transactions contemplated hereby and to become a Lender under
the Credit Agreement, (ii) it satisfies the requirements, if any,
specified in the Credit Agreement that are required to be satisfied by it in
order to acquire the Assigned Interest and become a Lender, (iii) from and
after the Effective Date, it shall be bound by the provisions of the Credit
Agreement as a Lender thereunder and, to the extent of the Assigned Interest,
shall have the obligations of a Lender thereunder, (iv) it has received a
copy of the Credit Agreement, together with copies of the most recent financial
statements delivered pursuant to Section 6.01 thereof, as applicable, and
such other documents and information as it has deemed appropriate to make its
own credit analysis and decision to enter into this Assignment and Assumption
and to purchase the Assigned Interest on the basis of which it has made such
analysis and decision independently and without reliance on the Administrative
Agent or any other Lender, and (v) if it is a Foreign Lender, attached to
the Assignment and Assumption is any documentation required to be delivered by
it pursuant to the terms of the Credit Agreement, duly completed and executed
by the Assignee; 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 which by the terms of the Loan Documents are
required to be performed by it as a Lender.

 

2.             Payments.  From and after the Effective Date, the
Administrative Agent shall make all payments in respect of the Assigned Interest
(including payments of principal, interest, 

 

1

 

fees and other amounts) to the
Assignor for amounts which have accrued to but excluding the Effective Date and
to the Assignee for amounts which have accrued from and after the Effective
Date.

 

3.             General Provisions.
This Assignment and Assumption shall be binding upon, and inure to the benefit
of, the parties hereto and their respective successors and assigns.  This Assignment and Assumption may be executed
in any number of counterparts, which together shall constitute one
instrument.  Delivery of an executed
counterpart of a signature page of this Assignment and Assumption by
telecopy shall be effective as delivery of a manually executed counterpart of
this Assignment and Assumption.  This
Assignment and Assumption shall be governed by, and construed in accordance
with, the law of the State of New York.

 

2

 

EXHIBIT B

 

OPINION OF COUNSEL FOR THE BORROWER

 

(See attached)

 

 

EXHIBIT C

 

COUNTERPART AGREEMENT

 

This COUNTERPART AGREEMENT, dated [            ]
(this “Counterpart Agreement”) is
delivered pursuant to that certain Senior Unsecured Term Credit Agreement,
dated as of July 15, 2008 (as it may be amended, restated, supplemented or
otherwise modified from time to time, the “Credit
Agreement”; the terms defined therein and not otherwise defined
herein being used herein as therein defined), by and among EXCO OPERATING COMPANY, LP, as Borrower, CERTAIN SUBSIDIARIES
OF BORROWER, as Guarantors, the LENDERS party thereto, and JPMORGAN CHASE BANK, N.A.,  as Administrative Agent (in such capacity,
the “Administrative
Agent”).

 

Section 1.  Pursuant to Section 6.13 of the Credit
Agreement, the undersigned hereby:

 

(a)           agrees that this
Counterpart Agreement may be attached to the Credit Agreement and that by the
execution and delivery hereof, the undersigned becomes a Guarantor under the
Credit Agreement and agrees to be bound by all of the terms thereof;

 

(b)           represents and warrants
that each of the representations and warranties set forth in the Credit
Agreement and each other Loan Document and applicable to the undersigned is
true and correct both before and after giving effect to this Counterpart
Agreement, except to the extent that any such representation and warranty
relates solely to any earlier date, in which case such representation and
warranty is true and correct as of such earlier date;

 

(c)           no event has occurred
or is continuing as of the date hereof, or will result from the transactions
contemplated hereby on the date hereof, that would constitute an Event of
Default or a Default; and

 

(d)           agrees to irrevocably
and unconditionally guaranty the due and punctual payment in full of all
Obligations when the same shall become due, whether at stated maturity, by
required prepayment, declaration, acceleration, demand or otherwise (including
amounts that would become due but for the operation of the automatic stay under
Section 362(a) of the Bankruptcy Code, 11 U.S.C. § 362(a))
and in accordance with Section 8 of the Credit Agreement.

 

Section 2.  The undersigned agrees from time to time,
upon request of Administrative Agent, to take such additional actions and to
execute and deliver such additional documents and instruments as Administrative
Agent  may request to effect the
transactions contemplated by, and to carry out the intent of, this
Agreement.  Neither this Agreement nor
any term hereof may be changed, waived, discharged or terminated, except by an
instrument in writing signed by the party (including, if applicable, any party
required to evidence its consent to or acceptance of this Agreement) against
whom enforcement of such change, waiver, discharge or termination is
sought.  Any notice or other
communication herein required or permitted to be given shall be given in
pursuant to Section 11.01 of the Credit Agreement, and for all purposes
thereof, the notice address of the undersigned shall be the address as set
forth on the signature page hereof. 
In case any provision in or obligation under this Agreement shall be
invalid, illegal or unenforceable in any jurisdiction, the validity, legality
and enforceability of the remaining 

 

1

 

provisions or obligations, or of
such provision or obligation in any other jurisdiction, shall not in any way be
affected or impaired thereby.

 

THIS AGREEMENT
SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH,
THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAWS
PRINCIPLES THEREOF.

 

2

 

IN
WITNESS WHEREOF, the undersigned has caused this
Counterpart Agreement to be duly executed and delivered by its duly authorized
officer as of the date above first written.

 

	
   

  	
  [NAME OF SUBSIDIARY]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

	
  Address for
  Notices:

  
	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Attention:

  	
   

  
	
   

  	
  Telecopier

  	
   

  
	
   

  
	
  with a copy
  to:

  
	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Attention:

  	
   

  
	
   

  	
  Telecopier

  	
   

  
	
   

  
	
  ACKNOWLEDGED AND ACCEPTED,

  
	
  as of the date above first written:

  
	
   

  
	
  JPMORGAN CHASE BANK, N.A.,

  
	
  as Administrative Agent

  
	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
  Name:

  
	
  Title:

  
					

 

3

 

EXHIBIT D

 

CERTIFICATE REGARDING SOLVENCY

 

The
undersigned, as Chief Financial Officer of EXCO Operating Company, LP, a
Delaware limited partnership (the “Borrower”), hereby gives this
Certificate Regarding Solvency to induce JPMorgan Chase Bank, N.A., as
Administrative Agent for the Lenders (defined below) (the “Administrative
Agent”) to consummate certain financial accommodations pursuant to the
terms and conditions of that certain Senior Unsecured Term Credit Agreement
dated as of July 15, 2008 (the “Credit Agreement”) among the
Borrower, certain Subsidiaries of the Borrower, as Guarantors, the lenders
signatory thereto (the “Lenders”), and Administrative Agent.  Capitalized terms used in this certificate
are defined in the Credit Agreement, unless otherwise stated.

 

The
undersigned hereby certifies to the Administrative Agent that:

 

1.             The
undersigned is familiar with the business and financial affairs of the
Borrower, including, without limitation, the Transactions and the matters
hereinafter described.

 

2.             The
undersigned has reviewed the pro-forma balance sheet of the Borrower, prepared
as of the date thereof and after giving effect to the Transactions (the “Pro-Forma
Balance Sheet”), the pro-forma operating statement, as of the date thereof
(the “Pro-Forma Operating Statement”) and the Projections, all of which
are attached hereto as Exhibit “A,”  Exhibit “B” and Exhibit “C,”
respectively, and incorporated herein by reference for all purposes.  The undersigned is familiar with the process
through which the Pro-Forma Balance Sheet, the Pro Forma Operating Statement
and the Projections were generated.

 

3.             The
Pro-Forma Balance Sheet fairly presents in all material respects the financial
position of the Borrower as of the date thereof after giving effect to the
Transactions.  The Pro Forma Operating
Statement fairly presents in all material respects the estimated operating
income and expenses of the Borrower and its Subsidiaries for the period covered
thereby.  The Projections are reasonable
projections of the balance sheet, income statement and source and application
of funds for the periods covered thereby, based upon the assumptions set forth
therein.  The Borrower believes that such
assumptions set forth therein are reasonable in light of current business
conditions existing at the time of preparation thereof.  The Projections and the Pro-Forma Operating
Statement represent the Borrower’s good faith estimate as of the date thereof
of the Borrower’s future financial performance, it being recognized by the Administrative
Agent that such financial information as it relates to future events is not to
be viewed as fact and that actual results during the period or periods covered
thereby may differ from the projected results set forth therein.

 

4.             Immediately
following the consummation of, and after giving effect to, the Transactions
contemplated by the Loan Documents and the application of the proceeds from the
fundings being made on the Effective Date, the Borrower is solvent.

 

5.             The
Borrower does not intend to incur, or believe it will incur, debts beyond its
ability to pay as they mature.

 

DATED:  July     , 2008

 

1

 

	
   

  	
  EXCO OPERATING
  COMPANY, LP 

  
	
   

  	
   

  
	
   

  	
  By:

  	
  EXCO
  Partners OLP GP, LLC

  
	
   

  	
   

  	
  its sole general partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:  J. Douglas Ramsey, Ph.D.

  
	
   

  	
   

  	
  Title: Vice President and Chief Financial Officer

  

 

2

 

EXHIBIT “A”

TO CERTIFICATE REGARDING SOLVENCY

Pro-Forma Balance Sheet

 

(see attached)

 

3

 

EXHIBIT “B”

TO CERTIFICATE REGARDING SOLVENCY

Pro-Forma Operating Statement

 

(see attached)

 

4

 

EXHIBIT “C”

TO CERTIFICATE REGARDING SOLVENCY

Projections

 

(see attached)

 

5

 

EXHIBIT E

 

NOTE

 

	
  New York,
  New York

  	
                     ,      

  

 

FOR VALUE
RECEIVED, the undersigned EXCO OPERATING COMPANY, LP, a Delaware limited
partnership (“Borrower”), hereby unconditionally promises to pay to the
order of
                                          
(the “Lender”) the principal amount of the Loans advanced by Lender and
outstanding at any time or from time to time pursuant to the Credit Agreement
(as hereinafter defined) in lawful money of the United States of America
together with interest from the date hereof until paid at the rates specified
in the Credit Agreement (as hereinafter defined).  All payments of principal and interest due
hereunder are payable at the offices of Administrative Agent under the Credit
Agreement, JPMorgan Loan Services, 21 South Clark St., 19th Floor,
Chicago, Illinois 60603-2003, Attention: 
Claudia Kech, Facsimile:  (312)
385-7096, claudia.kech@jpmchase.com, with a copy to JPMorgan Chase Bank, N.A.,
Mail Code TX1-2448, 2200 Ross Avenue, 3rd Floor, Dallas, Texas
75201, Attention: Wm. Mark Cranmer, Senior Vice President, Facsimile:  (214) 965-3280, mark.cranmer@jpmorgan.com, or
at such other place, as from time to time may be designated by Administrative
Agent in accordance with the Credit Agreement.

 

The principal
and all accrued interest on this Note shall be due and payable in accordance
with the terms and provisions of the Credit Agreement.

 

This Note is
executed pursuant to that certain Credit Agreement dated as of July 15,
2008 among Borrower, certain Subsidiaries of the Borrower, as Guarantors, the
Administrative Agent and Lenders (as amended, modified, supplemented or
restated from time to time, the “Credit Agreement”), and is one of the
notes referred to in Section 2.08(f) of the Credit Agreement.  Reference is made to the Credit Agreement and
the Loan Documents (as that term is defined in the Credit Agreement) for a
statement of prepayment rights and obligations of Borrower, for a statement of
the terms and conditions under which the due date of this Note may be
accelerated and for statements regarding other matters affecting this Note
(including without limitation the obligations of the holder hereof to advance
funds hereunder, principal and interest payment due dates, voluntary and
mandatory prepayments, exercise of rights and remedies, payment of attorneys’
fees, court costs and other costs of collection and certain waivers by Borrower
and others now or hereafter obligated for payment of any sums due hereunder).  Upon the occurrence of an Event of Default
(as that term is defined in the Credit Agreement and Loan Documents), the
Administrative Agent may declare forthwith to be entirely and immediately due
and payable the principal balance hereof and the interest accrued hereon, and
the Lender shall have all rights and remedies of the Lender under the Credit
Agreement and Loan Documents.  This Note
may be prepaid in accordance with the terms and provisions of the Credit Agreement.

 

Regardless of
any provision contained in this Note, the holder hereof shall never be entitled
to receive, collect or apply, as interest on this Note, any amount in excess of
the Maximum Rate (as such term is defined in the Credit Agreement), and, if the
holder hereof ever receives, collects, or applies as interest, any such amount
which would be excessive interest, it shall be deemed a partial prepayment of
principal and treated hereunder as such; and, if the 

 

1

 

indebtedness evidenced hereby
is paid in full, any remaining excess shall forthwith be paid to Borrower.  In determining whether or not the interest
paid or payable, under any specific contingency, exceeds the Maximum Rate,
Borrower and the holder hereof shall, to the maximum extent permitted under
applicable law (i) characterize any non-principal payment as an expense,
fee or premium rather than as interest, (ii) exclude voluntary prepayments
and the effects thereof, and (iii) spread the total amount of interest
throughout the entire contemplated term of the obligations evidenced by this
Note and/or referred to in the Credit Agreement so that the interest rate is
uniform throughout the entire term of this Note; provided that, if this Note is
paid and performed in full prior to the end of the full contemplated term
thereof; and if the interest received for the actual period of existence
thereof exceeds the Maximum Rate, the holder hereof shall refund to Borrower
the amount of such excess or credit the amount of such excess against the
indebtedness evidenced hereby, and, in such event, the holder hereof shall not
be subject to any penalties provided by any laws for contracting for, charging,
taking, reserving or receiving interest in excess of the Maximum Rate.

 

If any payment
of principal or interest on this Note shall become due on a day other than a
Business Day (as such term is defined in the Credit Agreement), such payment
shall be made on the next succeeding Business Day and such extension of time
shall in such case be included in computing interest in connection with such
payment.

 

If this Note
is placed in the hands of an attorney for collection, or if it is collected
through any legal proceeding at law or in equity or in bankruptcy, receivership
or other court proceedings, Borrower agrees to pay all costs of collection,
including, but not limited to, court costs and reasonable attorneys’ fees.

 

Borrower and
each surety, endorser, guarantor and other party ever liable for payment of any
sums of money payable on this Note, jointly and severally waive presentment and
demand for payment, notice of intention to accelerate the maturity, protest,
notice of protest and nonpayment, as to this Note and as to each and all
installments hereof, and agree that their liability under this Note shall not
be affected by any renewal or extension in the time of payment hereof, or in
any indulgences, or by any release or change in any security for the payment of
this Note, and hereby consent to any and all such renewals, extensions,
indulgences, releases or changes.

 

This Note
shall be governed by and construed in accordance with the applicable laws of
the United States of America and the laws of the State of New York.

 

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

 

2

 

EXECUTED as of
the date and year first above written.

 

	
   

  	
  BORROWER:

  
	
   

  	
   

  
	
   

  	
  EXCO OPERATING
  COMPANY, LP 

  
	
   

  	
   

  
	
   

  	
  By:

  	
  EXCO
  Partners OLP GP, LLC

  
	
   

  	
   

  	
  its sole general partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
						

 

3

 

EXHIBIT F

 

FORM OF LENDER
CERTIFICATE

 

                ,
200     

 

	
  To:

  	
  JPMORGAN CHASE BANK, N.A.,

  
	
   

  	
  as Administrative Agent

  

 

The Borrower, the Guarantors, the Administrative Agent
and the Lenders have entered into that certain Senior Unsecured Term Credit
Agreement dated as of July 15, 2008 (as the same may be amended, restated,
supplemented or otherwise modified from time to time, the “Credit Agreement”). 
Unless otherwise defined herein, capitalized terms used herein have the
meaning specified in the Credit Agreement.

 

[Language
for Existing Lender]

 

[               Please
be advised that the undersigned has agreed (a) to increase its Commitment
under the Credit Agreement effective
                        ,
2008 from $                                
to $                        
and (b) that it shall continue to be a Lender in all respects to the
Credit Agreement and the other Loan Documents.]

 

[Language
for New Lender]

 

[               Please
be advised that the undersigned has agreed (a) to become a Lender under
the Credit Agreement effective
                            ,
2008 with a Commitment of $                        
and (b) that it shall be deemed to be a Lender in all respects to the
Credit Agreement and the other Loan Documents.]

 

Very
truly yours,

	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

1

 

Accepted and
Agreed:

 

JPMORGAN CHASE
BANK, N.A.,

as Administrative Agent

 

 

	
  By:

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  
						

 

 

Accepted and
Agreed:

 

	
  EXCO OPERATING
  COMPANY, LP 

  
	
   

  
	
  By:

  	
  EXCO
  Partners OLP GP, LLC

  
	
   

  	
  its sole general partner

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
						

 

2Exhibit 10.2

 

EXECUTION VERSION

 

SECOND AMENDMENT TO 

AMENDED AND RESTATED CREDIT AGREEMENT

 

SECOND
AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT (hereinafter referred to as
the “Amendment”) dated as of July 14, 2008, by and among EXCO
OPERATING COMPANY, LP (formerly known as EXCO Partners Operating Partnership,
LP) (“Borrower”), CERTAIN SUBSIDIARIES OF BORROWER, as Guarantors (the “Guarantors”),
the LENDERS party hereto (the “Lenders”), and JPMORGAN CHASE BANK, N.A.,
as Administrative Agent (“Administrative Agent”).  Unless the context otherwise requires or
unless otherwise expressly defined herein, capitalized terms used but not
defined in this Amendment have the meanings assigned to such terms in the
Credit Agreement (as defined below).

 

WITNESSETH:

 

WHEREAS,
Borrower, Guarantors, Administrative Agent and Lenders have entered into that
certain Amended and Restated Credit Agreement dated as of March 30, 2007,
as amended by that certain First Amendment to Amended and Restated Credit
Agreement dated as of February 20, 2008 (as the same may further be
amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”); and

 

WHEREAS,
Borrower has requested that the Administrative Agent and the Lenders amend the
Credit Agreement to, among other things, permit the incurrence of additional
unsecured Indebtedness of the Borrower pursuant to the terms and conditions of
a senior unsecured term loan facility in an aggregate principal amount not to
exceed $500,000,000.

 

NOW, THEREFORE, for and
in consideration of the mutual covenants and agreements herein contained and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged and confessed, Borrower, Guarantors, Administrative Agent
and the Lenders hereby agree as follows:

 

SECTION 1.  Amendments to Credit Agreement.  Subject to the satisfaction or waiver in
writing of each condition precedent set forth in Section 2 hereof,
and in reliance on the representations, warranties, covenants and agreements
contained in this Amendment, the Credit Agreement shall be amended in the
manner provided in this Section 1.

 

1.1                               Additional
Definitions.  Section 1.01 of the Credit
Agreement shall be and it hereby is amended by inserting the following
definitions in appropriate alphabetical order:

 

“Senior
Unsecured Term Loan Facility” means a senior unsecured term loan facility
pursuant to which certain financial institutions and other entities have agreed
to provide Borrower with unsecured term loans; provided that (i) the
stated maturity date of such term loans is not later than December 15,
2008 and (ii) the covenant, default and remedy provisions with respect to
such term loans are not materially more restrictive than those set forth in
this Agreement.

 

“Term
Loans” means the senior unsecured term loans outstanding under the Senior
Unsecured Term Loan Facility.

 

 

1.2                               Indebtedness.  Section 7.01 of the Credit
Agreement shall be and it hereby is amended by (i) renumbering clause (h) of
such section to be clause (i) of such section and (ii) inserting a
new clause (h) immediately following clause (g) to read as follows:

 

(h)                               unsecured Indebtedness of the Borrower
under the Senior Unsecured Term Loan Facility in an aggregate principal amount
not to exceed $500,000,000 at any time outstanding; and

 

1.3                               Financial
Covenants; Consolidated Current Ratio.  Clause (a) of Section 7.11
of the Credit Agreement shall be and it hereby is amended and restated in its
entirety to read as follows:

 

(a)                               Consolidated Current Ratio. 
The Borrower will not permit the Consolidated Current Ratio as of the
end of any fiscal quarter ending on or after June 30, 2007 to be less than
1.00 to 1.00; provided that for purposes of determining compliance with
this Section 7.11(a), the calculation of Consolidated Current Liabilities
as of the end of any fiscal quarter ending on or before December 31, 2008,
shall not include any Indebtedness of the Borrower under the Senior Unsecured
Term Loan Facility to the extent such Indebtedness is permitted under Section 7.01(h).

 

1.4                               Restrictions on Certain
Prepayments.  Article VII of the Credit Agreement
shall be and it hereby is amended by inserting the following at the end of such
Article as Section 7.13:

 

Section 7.13                            Senior Unsecured Term Loan Facility
Restrictions.             Prior to the termination of all
Commitments and the payment and performance in full of the Obligations, the
Borrower will not, nor will it permit any Restricted Subsidiary to, directly or
indirectly, retire, redeem, defease, repurchase or prepay prior to the
scheduled due date thereof any part of the principal of, or interest on, the
Term Loans; except that the Borrower may retire, redeem, defease, repurchase or
prepay the Term Loans (including any premium on the prepaid principal amount of
such Indebtedness) at any time; provided that (i) no Default has occurred
and is continuing or would result from the making of such retirement,
redemption, defeasance, repurchase or prepayment, and (ii) after giving
effect to such retirement, redemption, defeasance, repurchase or prepayment,
the Aggregate Commitment exceeds Aggregate Credit Exposure by an amount equal
to or greater than ten percent (10%) of the Aggregate Commitment.

 

SECTION 2.  Conditions.  The amendments to the Credit
Agreement contained in Section 1 of this Amendment, shall be
effective upon the satisfaction of each of the conditions set forth in this Section 2.

 

2.1                               Execution
and Delivery.  Each Credit
Party, the Majority Lenders and the Administrative Agent shall have executed
and delivered this Amendment.

 

2

 

2.2                               No
Default.  No Default or Event of Default
shall have occurred and be continuing or shall result after giving effect to
this Amendment.

 

2.3                               Other
Documents.  The
Administrative Agent shall have received such other instruments and documents
incidental and appropriate to the transaction provided for herein as the
Administrative Agent or its special counsel may reasonably request, and all
such documents shall be in form and substance satisfactory to the
Administrative Agent.

 

SECTION 3.       Representations
and Warranties of Borrower.  To induce the Lenders to enter into this
Amendment, each Credit Party hereby represents and warrants to the Lenders as
follows:

 

3.1                               Reaffirmation
of Representations and Warranties/Further Assurances.  After giving effect to the amendments herein,
each representation and warranty of such Credit Party contained in the Credit
Agreement or in any other Loan Document is true and correct in all material
respects on the date hereof (except to the extent such representations and
warranties relate solely to an earlier date, in which case such representations
and warranties shall have been true and correct in all material respects as of
such date).

 

3.2                               Corporate
Authority; No Conflicts.  The
execution, delivery and performance by such Credit Party of this Amendment and
all documents, instruments and agreements contemplated herein are within such
Credit Party’s corporate or other organizational powers, have been duly authorized
by necessary action, require no action by or in respect of, or filing with, any
court or agency of government and do not violate or constitute a default under
any provision of any applicable law or other agreements binding upon such
Credit Party or result in the creation or imposition of any Lien upon any of
the assets of such Credit Party except for Liens permitted under Section 7.02
of the Credit Agreement.

 

3.3                               Enforceability.  This Amendment constitutes the valid and
binding obligation of such Credit Party enforceable in accordance with its
terms, except as (i) the enforceability thereof may be limited by
bankruptcy, insolvency or similar laws affecting creditor’s rights generally,
and (ii) the availability of equitable remedies may be limited by
equitable principles of general application.

 

SECTION 4.       Miscellaneous.

 

4.1                               Reaffirmation
of Loan Documents and Liens.  Any and all of the terms and provisions of
the Credit Agreement and the Loan Documents shall, except as amended and
modified hereby, remain in full force and effect.  Each Credit Party hereby agrees that the
amendments and modifications herein contained shall in no manner affect or
impair the liabilities, duties and obligations of any Credit Party under the
Credit Agreement and the other Loan Documents or the Liens securing the payment
and performance thereof.

 

4.2                               Parties
in Interest.  All of the
terms and provisions of this Amendment shall bind and inure to the benefit of
the parties hereto and their respective successors and assigns.

 

4.3                               Legal
Expenses.  Each Credit
Party hereby agrees to pay all reasonable fees and expenses of special counsel
to the Administrative Agent incurred by the Administrative Agent in

 

3

 

connection with the
preparation, negotiation and execution of this Amendment and all related
documents.

 

4.4                               Counterparts.  This Amendment may be executed in one or more
counterparts and by different parties hereto in separate counterparts each of
which when so executed and delivered shall be deemed an original, but all such
counterparts together shall constitute but one and the same instrument;
signature pages may be detached from multiple separate counterparts and
attached to a single counterpart so that all signature pages are
physically attached to the same document. 
However, this Amendment shall bind no party until each Credit Party, the
Majority Lenders, and the Administrative Agent have executed a counterpart.  Delivery of photocopies of the signature pages to
this Amendment by facsimile or electronic mail shall be effective as delivery
of manually executed counterparts of this Amendment.

 

4.5                               Complete
Agreement.  THIS
AMENDMENT, THE CREDIT AGREEMENT, AND THE OTHER LOAN DOCUMENTS REPRESENT THE
FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS OR ORAL AGREEMENTS OF THE PARTIES.  THERE ARE NO UNWRITTEN ORAL AGREEMENTS
BETWEEN THE PARTIES.

 

4.6                               Headings. 
The headings, captions and arrangements used in this Amendment are,
unless specified otherwise, for convenience only and shall not be deemed to
limit, amplify or modify the terms of this Amendment, nor affect the meaning
thereof.

 

4.7                               Governing Law. 
This Amendment shall be construed in accordance with and governed by the
law of the State of New York.

 

[Signature Pages Follow]

 

4

 

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

 

	
   

  	
  BORROWER:

  
	
   

  	
   

  
	
   

  	
  EXCO OPERATING COMPANY, LP

  
	
   

  	
  (formerly known as EXCO Partners Operating

  
	
   

  	
  Partnership, LP)

  
	
   

  	
   

  
	
   

  	
  By:

  	
  EXCO Partners OLP GP, LLC

  
	
   

  	
   

  	
  its sole general partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ J. Douglas Ramsey,
  Ph.D.

  
	
   

  	
   

  	
  Name:

  	
  J. Douglas Ramsey, Ph.D.

  
	
   

  	
   

  	
  Title:

  	
  Vice President and Chief Financial

  Officer

  
	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  EXCO Operating Company, LP

  
	
   

  	
  12377 Merit Drive,
  Suite 1700

  
	
   

  	
  Dallas, Texas 75251

  
	
   

  	
  Facsimile
  No. 214-368-2087

  
	
   

  	
  Attn:

  	
  Douglas H. Miller

  
	
   

  	
   

  	
  Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
  and

  
	
   

  	
   

  
	
   

  	
  Attn:

  	
  J. Douglas Ramsey

  
	
   

  	
   

  	
  Chief Financial Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  GUARANTORS:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  GARRISON GATHERING, LLC

  
	
   

  	
  VAUGHAN DE, LLC

  
	
   

  	
  VAUGHAN HOLDING COMPANY, LLC

  
	
   

  	
  VERNON GATHERING, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. Douglas Ramsey,
  Ph.D.

  
	
   

  	
  Name:

  	
  J. Douglas Ramsey, Ph.D.

  
	
   

  	
  Title:

  	
  Vice President and Chief Financial Officer

  for each of the Credit Parties listed above

  
									

 

Second Amendment to Amended and Restated Credit Agreement – Signature
Page

 

 

	
   

  	
  TALCO MIDSTREAM ASSETS, LTD.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  VAUGHAN HOLDING COMPANY,
  LLC.

  
	
   

  	
   

  	
  its General Partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ J. Douglas Ramsey,
  Ph.D.

  
	
   

  	
   

  	
  Name:

  	
  J. Douglas Ramsey, Ph.D.

  
	
   

  	
   

  	
  Title:

  	
  Vice President and Chief Financial

  Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  TGG PIPELINE, LTD.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  VAUGHAN HOLDING COMPANY,
  LLC,

  
	
   

  	
   

  	
  its General Partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ J. Douglas Ramsey,
  Ph.D.

  
	
   

  	
   

  	
  Name:

  	
  J. Douglas Ramsey, Ph.D.

  
	
   

  	
   

  	
  Title:

  	
  Vice President and Chief Financial

  Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EXCO PRODUCTION COMPANY, LP

  (formerly known as Winchester Production

  Company, Ltd.)

  
	
   

  	
   

  
	
   

  	
  By:

  	
  VAUGHAN DE, LLC,

  
	
   

  	
   

  	
  Its General Partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ J. Douglas Ramsey,
  Ph.D.

  
	
   

  	
   

  	
  Name:

  	
  J. Douglas Ramsey, Ph.D.

  
	
   

  	
   

  	
  Title:

  	
  Vice President and Chief Financial

  Officer

  
						

 

Second Amendment to Amended and Restated Credit Agreement – Signature
Page

 

 

	
   

  	
  JPMORGAN CHASE BANK, N.A.,

  
	
   

  	
  as a Lender and as
  Administrative Agent,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ William Mark Cranmer

  
	
   

  	
  Name:

  	
  Wm. Mark Cranmer

  
	
   

  	
  Title:

  	
  Senior Vice President

  
				

 

Second Amendment to Amended and Restated Credit Agreement – Signature
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  UBS LOAN FINANCE LLC

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David B. Julie

  
	
   

  	
  Name:

  	
  David B. Julie

  
	
   

  	
  Title:

  	
  Associate Director

  Banking Products

  Services, US

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mary E. Evans

  
	
   

  	
  Name:

  	
  Mary E. Evans

  
	
   

  	
  Title:

  	
  Associate Director

  Banking Products

  Services, US

  
				

 

Second Amendment to Amended and Restated Credit Agreement – Signature
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  CREDIT SUISSE, CAYMAN ISLANDS

  BRANCH

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Vanessa Gomez

  
	
   

  	
  Name:

  	
  Vanessa
  Gomez

  
	
   

  	
  Title:

  	
  Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Nupur Kumar

  
	
   

  	
  Name:

  	
  Nupur Kumar

  
	
   

  	
  Title:

  	
  Associate

  
				

 

Second Amendment to Amended and Restated Credit Agreement – Signature
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  LEHMAN BROTHERS COMMERCIAL BANK

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Darren S. Lane

  
	
   

  	
  Name:

  	
  Darren
  S. Lane

  
	
   

  	
  Title:

  	
  Operations
  Officer

  
				

 

Second Amendment to Amended and Restated Credit Agreement – Signature
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  BNP PARIBAS

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Betsy Jocher

  
	
   

  	
  Name:

  	
  Betsy
  Jocher

  
	
   

  	
  Title:

  	
  Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert Long

  
	
   

  	
  Name:

  	
  Robert Long

  
	
   

  	
  Title:

  	
  Vice President

  
				

 

Second Amendment to Amended and Restated Credit Agreement – Signature
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  KEYBANK N.A.

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kevin Hays

  
	
   

  	
  Name:

  	
  Kevin
  Hays

  
	
   

  	
  Title:

  	
  Director

  
				

 

Second Amendment to Amended and Restated Credit Agreement – Signature
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  MORGAN STANLEY SENIOR FUNDING,

  INC.

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Darragh Dempsey

  
	
   

  	
  Name:

  	
  Darragh
  Dempsey

  
	
   

  	
  Title:

  	
  Vice
  President

  
				

 

Second Amendment to Amended and Restated Credit Agreement – Signature
Page

 

 

	
   

  	
  NATIXIS

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Donovan C. Broussard

  
	
   

  	
  Name:

  	
  Donovan
  C. Broussard

  
	
   

  	
  Title:

  	
  Managing Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Liana Tchernysheva

  
	
   

  	
  Name:

  	
  Liana Tchernysheva

  
	
   

  	
  Title:

  	
  Director

  
				

 

Second Amendment to Amended and Restated Credit Agreement – Signature
Page

 

 

	
   

  	
  ROYAL BANK OF CANADA

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Don J. McKinnerney

  
	
   

  	
  Name:

  	
  Don
  J. McKinnerney

  
	
   

  	
  Title:

  	
  Authorized
  Signatory

  
				

 

Second Amendment to Amended and Restated Credit Agreement – Signature
Page

 

 

	
   

  	
  STERLING BANK

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jeff A. Forbis

  
	
   

  	
  Name:

  	
  Jeff
  A. Forbis

  
	
   

  	
  Title:

  	
  Senior
  Vice President

  Sterling Bank

  
				

 

Second Amendment to Amended and Restated Credit Agreement – Signature
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  UNION BANK OF CALIFORNIA, N.A.

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Doug Gale

  
	
   

  	
  Name:

  	
  Doug
  Gale

  
	
   

  	
  Title:

  	
  Vice
  President

  
				

 

Second Amendment to Amended and Restated Credit Agreement – Signature
Page

 

 

	
   

  	
  THE BANK OF NOVA SCOTIA

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David G. Mills

  
	
   

  	
  Name:

  	
  David
  G. Mills

  
	
   

  	
  Title:

  	
  Director

  
				

 

Second Amendment to Amended and Restated Credit Agreement – Signature
Page

 

 

	
   

  	
  WACHOVIA BANK NATIONAL

  ASSOCIATION

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Paul Pritchett

  
	
   

  	
  Name:

  	
  Paul
  Pritchett

  
	
   

  	
  Title:

  	
  Vice
  President

  
				

 

Second Amendment to Amended and Restated Credit Agreement – Signature
Page

 

 

	
   

  	
  WELLS FARGO BANK, N.A.

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Tom K. Martin

  
	
   

  	
  Name:

  	
  Tom
  K. Martin

  
	
   

  	
  Title:

  	
  Vice
  President

  
				

 

Second Amendment to Amended and Restated Credit Agreement – Signature
Page

 

 

	
   

  	
  BMO CAPITAL MARKETS FINANCING,

  INC.

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ James V. Ducote

  
	
   

  	
  Name:

  	
  James
  V. Ducote

  
	
   

  	
  Title:

  	
  Director

  
				

 

Second Amendment to Amended and Restated Credit Agreement – Signature
Page

 

 

	
   

  	
  CITIBANK, N.A.

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Ryan Watson

  
	
   

  	
  Name:

  	
  Ryan
  Watson

  
	
   

  	
  Title:

  	
  V.P.

  
				

 

Second Amendment to Amended and Restated Credit Agreement – Signature
Page

 

 

	
   

  	
  ALLIED IRISH BANKS, P.L.C.

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mark Connelly

  
	
   

  	
  Name:

  	
  Mark
  Connelly

  
	
   

  	
  Title:

  	
  Senior
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ James Giordano

  
	
   

  	
  Name:

  	
  James
  Giordano

  
	
   

  	
  Title:

  	
  Assistant
  Vice President

  
				

 

Second Amendment to Amended and Restated Credit Agreement – Signature
Page

 

 

	
   

  	
  DEUTSCHE BANK TRUST COMPANY

  AMERICAS

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Erin Morrissey

  
	
   

  	
  Name:

  	
  Erin
  Morrissey

  
	
   

  	
  Title:

  	
  Vice
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Dusan Lazarov

  
	
   

  	
  Name:

  	
  Dusan
  Lazarov

  
	
   

  	
  Title:

  	
  Vice
  President

  
				

 

Second Amendment to Amended and Restated Credit Agreement – Signature
Page

 

 

	
   

  	
  CALYON NEW YORK BRANCH

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michael D. Willis

  
	
   

  	
  Name:

  	
  Michael
  D. Willis

  
	
   

  	
  Title:

  	
  Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Tom Byargeon

  
	
   

  	
  Name:

  	
  Tom
  Byargeon

  
	
   

  	
  Title:

  	
  Managing
  Director

  
				

 

Second Amendment to Amended and Restated Credit Agreement – Signature
Page

 

 

	
   

  	
  U.S. BANK NATIONAL ASSOCIATION

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Daria Mahoney

  
	
   

  	
  Name:

  	
  Daria
  Mahoney

  
	
   

  	
  Title:

  	
  Vice
  President

  
				

 

Second Amendment to Amended and Restated Credit Agreement – Signature
Page

 

 

	
   

  	
  COMERICA BANK

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Rebecca L. Wilson

  
	
   

  	
  Name:

  	
  Rebecca
  L. Wilson

  
	
   

  	
  Title:

  	
  Assistant
  Vice President

  
				

 

Second Amendment to Amended and Restated Credit Agreement – Signature
Page

 

 

	
   

  	
  FORTIS CAPITAL CORP.

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michele Jones

  
	
   

  	
  Name:

  	
  Michele
  Jones

  
	
   

  	
  Title:

  	
  Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Ilene Fowler

  
	
   

  	
  Name:

  	
  Ilene
  Fowler

  
	
   

  	
  Title:

  	
  Director

  
				

 

Second Amendment to Amended and Restated Credit Agreement – Signature
Page

 

 

	
   

  	
  BANK OF AMERICA

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jeffrey H. Rathkamp

  
	
   

  	
  Name:

  	
  Jeffrey
  H. Rathkamp

  
	
   

  	
  Title:

  	
  Managing
  Director

  
				

 

Second Amendment to Amended and Restated Credit Agreement – Signature
Page

 

 

	
   

  	
  SUMITOMO MITSUI BANKING

  CORPORATION

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David A. Buck

  
	
   

  	
  Name:

  	
  David
  A. Buck

  
	
   

  	
  Title:

  	
  Senior
  Vice President

  
				

 

Second Amendment to Amended and Restated Credit Agreement – Signature
Page

 

 

	
   

  	
  BARCLAYS BANK PLC

  
	
   

  	
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Joseph Gyurindak

  
	
   

  	
  Name:

  	
  Joseph
  gyurindak

  
	
   

  	
  Title:

  	
  Director

  
				

 

Second Amendment to Amended and Restated Credit Agreement – Signature
Page

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00144-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00144-of-00352.parquet"}]]