Document:

Unassociated Document

     

    EXHIBIT
10.2

       

      EMPLOYMENT
AGREEMENT

      

      THIS
EMPLOYMENT AGREEMENT (this “Agreement”) is made
and entered into as of October 1, 2007 (the
“Effective
Date”), by and between InnerWorkings, Inc., a
Delaware corporation (the “Company”), and Jonathan Shean (“Employee”).

      

      1.          
Employment; Position
and Duties. The Company agrees to employ Employee, and Employee agrees to
be employed by the Company, upon the terms and conditions of this Agreement.
Employee shall be employed by the Company as the Company’s Senior Vice President
of Operations and shall report to the Executive Vice President of the Company.
Employee shall perform his duties and responsibilities to the best of his
ability and in a diligent, businesslike and efficient manner. Employee shall be
employed on a full-time basis and shall devote his best efforts and all of his
business time and attention (except for permitted vacation periods and
reasonable periods of illness or other incapacity) to the business and affairs
of the Company. Employee’s duties shall include all those duties customarily
performed by the Senior Vice President of Operations and such other duties and
responsibilities commensurate with such position as may be reasonably assigned
to him by the Executive Vice President of the Company. Employee acknowledges and
agrees that his responsibilities shall include business development activities
and assistance and support to the mergers and acquisitions department. Employee
shall comply with any policies and procedures established for Company employees
from time to time which are not inconsistent with this Agreement, including
without limitation, those policies and procedures contained in the Company’s
employee handbook previously delivered to Employee. Employee agrees that during
the Term of Employment he shall not engage in any other employment, profitable
activities, or other pursuits which would cause him to utilize or disclose the
Company’s confidential information or trade secrets or detract in any material
way from his ability to devote his best efforts to the Company.

      

      2.      
    Term of Employment.
The term of this Agreement shall commence on the Effective Date and shall expire
on September 30, 2010, unless earlier terminated by either party in accordance
with the terms of this Agreement. The period during which Employee is employed
by the Company pursuant to the terms of this Agreement is hereinafter referred
to as the “Term of Employment.” This Agreement may be terminated by Employee or
by the Company at any time, with or without Cause (as defined below). Upon the
termination of Employee’s employment with the Company for any reason, neither
party shall have any further obligation or liability under this Agreement to the
other party, except as set forth in Sections 5, 6, 7, 8, 9, 10, 11, 12 and 13 of
this Agreement.

      

      3.          
Compensation.
As compensation for the services to be rendered and the other obligations
undertaken by Employee under this Agreement, the Company shall pay Employee the
compensation set forth in this Section 3 as follows:

      

      (a)        
Base Salary.
During the Term of Employment, Employee shall be paid a base salary (“Base Salary”) of
$20,000.00 per month (or $240,000.00 on an annualized basis), subject to
applicable withholding, in accordance with the Company’s normal payroll
procedures. Employee’s salary shall be reviewed on an annual basis by the
Company for possible increase (but not decrease) based on the Company’s
operating results and financial condition, salaries paid to other Company
executives, and general marketplace and other applicable considerations. Such
increased Base Salary, if any, shall then constitute Employee’s “Base Salary”
for purposes of this Agreement.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      (b)        
Benefits.
During the Term of Employment, Employee shall have the right, on the same basis
as other members of management of the Company, to participate in and to receive
benefits under any of the Company’s employee benefit plans, insurance programs
and/or indemnification agreements, as the same may then be in effect from time
to time, subject to any applicable waiting periods and other terms and
restrictions thereof. The Company shall reimburse Employee for the full amount
of his and his family’s insurance costs should be elect to participate in the
Company’s insurance program(s).

      

      (c)        
Bonus. In
addition to the Base Salary, Employee shall be eligible to receive an annual
performance bonus (“Performance Bonus”)
of up to $80,000. The Performance Bonus shall be a discretionary bonus,
determined in the sole discretion of the Company, with consideration given to
Employee’s performance of his duties and the Company’s financial performance, as
well certain performance targets that are approved by the Employees and/or
Directors of the Company. The Performance Bonus shall be paid within 60 days
following the end of each fiscal year of the Company. The Company agrees to pay
Employee a one-time bonus of $60,000 on January 1, 2008, provided that Employee
continues to be employed by the Company on such date. The Company also agrees to
pay Domtar, Employee’s prior employer, an amount equal to $12,500 for repayment
of Employee’s unpaid indebtedness to Domtar as of the Effective
Date.

      

      (d)        
Expenses. The
Company agrees to pay or to reimburse Employee for all reasonable, ordinary,
necessary and documented business or entertainment expenses incurred during the
Term of Employment in the performance of his services hereunder in accordance
with the policy of the Company as from time to time in effect. Employee, as a
condition precedent to obtaining such payment or reimbursement, shall provide to
the Company any and all statements, bills or receipts evidencing the travel or
out-of-pocket expenses for which Employee seeks payment or reimbursement, and
any other information or materials, as the Company may from time to time
reasonably require. The Company shall reimburse Employee for up to $12,500 for
documented moving costs and related expenses incurred by Employee in connection
with his relocation to the Chicago area.

      

      (e)        
Vacation.
During the Term of Employment, Employee shall be entitled to four (4) weeks paid
vacation per calendar year, and shall be entitled to as many holidays, sick days
and personal days as are in accordance with the Company’s policy then in effect
generally for its employees. Vacation time will be accrued at a rate of 30 days
per month and will not carry over from year to year.

      

      (f)        
Car Allowance.
During the Term of Employment, the Company will provide Employee with a car
allowance equal to $600 per month in accordance with the Company’s automobile
policy then in effect generally for its executive employees.

      
        
           

        

        
          -2-

          
            

          

        

        
           

        

      

       

      4.           Restricted Stock.
Concurrently with the execution of this Agreement, Employee shall be issued
50,000 shares of Common Stock of the Company (the “Restricted Stock”). The Restricted
Stock shall be subject to the following vesting schedule: 10,000 shares shall
vest on each of October 1st, 2008,
October 1st, 2009,
October 1st 2010,
October 1st, 2011
and October 1st, 2012.
Except as provided herein, the Restricted Stock shall be subject to the terms of
the InnerWorkings, Inc. 2006 Stock Incentive Plan (the “Plan”) and the restricted stock
agreement provided to Employee pursuant to the Plan, and Employee’s receipt of
the Restricted Stock shall be subject to his executing such restricted stock
agreement. A copy of the Plan and the restricted stock agreement are attached
hereto as Exhibit
A and Exhibit
B, respectively.

      

      5.           Rights and Obligations Upon
Termination.

      

      (a)    
     Definition of Cause.
For purposes of this Agreement, “Cause’ shall mean any
of the following:

      

      (i)     
Employee’s failure to perform reasonably assigned duties and responsibilities,
which failure is not cured by Employee after fifteen (15) days prior written
notice specifying the nature of the failure (provided, that any such notice also
must include a statement that failure to cure any such failure may result in the
termination by the Company of Employee’s employment for Cause) or is not capable
of being cured;

      

      (ii)    
the theft, dishonesty, fraud, misappropriation or other criminal malfeasance by
Employee against with respect to the Company or any of its subsidiaries or
affiliates or the falsification of any employment or other records of the
Company by Employee;

      

      (iii)  
  the determination by the Company that Employee has committed an act
or acts constituting a felony or any other crime involving theft, dishonesty,
fraud or moral turpitude;

      

      (iv)  
  the determination by the Company that Employee has engaged in
willful misconduct or gross negligence in the performance of his employment
duties;

      

      (v)  
   the determination by the Company that Employee has engaged in
willful misconduct that reflects so seriously on his or the Company’s public
reputation as to prejudice the interests of the Company or any of its
subsidiaries or affiliates if he were to continue to be retained as one of its
employees; or

      

      (vi)  
  the breach by Employee of any material provision of this Agreement,
which breach is not cured by Employee after fifteen (15) days prior written
notice specifying the nature of the breach (provided, that any such notice also
must include a statement that failure to cure any such breach may result in the
termination by the Company of Employee’s employment for Cause) or is not capable
of being cured.

      

      (b)  
       Definition of Good
Reason. For purposes of this Agreement, “Good Reason” shall mean any of the
following:

      

      (i)    
  a material reduction Employee’s duties or responsibilities in his
capacity as a Senior Vice President of Operations without Employee’s consent, or
a permanent change in Employee’s duties and responsibilities which are
materially inconsistent with the duties and responsibilities of a Senior Vice
President of Operations of the Company, which reduction or change is not cured
within fifteen (15) days of the receipt by the Company of written notice by
Employee stating the nature of such breach (provided, that any
such notice also must include a statement that failure to cure any such
reduction or change may result in a termination by Employee of his employment
for Good Reason);

      
        
           

        

        
          -3-

          
            

          

        

        
           

        

      

      (ii)  
   Employee being required to relocate the office from which he
performs his responsibilities to an office that is located more than thirty (30)
miles outside of Chicago, Illinois; or

      

      (iii)   
 a material breach of this Agreement by the Company, which breach is not
cured within fifteen (15) days of the receipt by the Company of written notice
by Employee stating the nature of such breach (provided, that any such notice
also must include a statement that failure to cure any such reduction or change
may result in a termination by Employee of his employment for Good
Reason).

      

      (c)     
    Without Cause or For Good
Reason. Upon the termination of the Term of Employment by the Company
without Cause or by Employee for Good Reason, the Company shall:

      

      (i)    
  continue to pay Employee’s Base Salary then in effect, less
applicable withholding and in accordance with the Company’s normal payroll
procedures, for a period equal to twelve (12) months following the effective
date of such termination (the “Severance
Period”);

      

      (ii)  
   pay any unpaid reimbursable expenses outstanding as of the
date of termination;

      

      (iii)  
  pay all benefits (including all accrued but unpaid vacation pay), if
any, that had accrued to Employee through the date of termination under the
benefit and retirement plans and programs in which he participated as an
employee of the Company in the manner and in accordance with the terms of such
plans and programs; and

      

      (v)    
 continue participation for Employee and his eligible dependents on the
same basis (except all premiums shall be paid by the Company) as the other
executives of the Company in all, medical, dental, disability and life insurance
coverage (such benefits collectively called the “Continued Plans”) in
which be was participating on the effective date of termination (as such
Continued Plans are from time to time in effect) until the end of the Severance
Period; provided, however, if Employee
is precluded from continuing his participation in any Continued Plan, then,
during the Severance Period, the Company will be obligated to reimburse him for
any payments made by Employee in order to maintain his and his family’s rights
granted by the Consolidated Omnibus Budget Reconciliation Act (“COBRA”)

      

      Notwithstanding
anything to the contrary herein, no payments shall be due under this Section
5(c) unless and until Employee shall have executed a general release and waiver
of claims against the Company, consistent with Section 8 below, and in a form
reasonably satisfactory to the Company, and the execution of such general
release and waiver shall be a condition to Employee’s rights under this Section
5(c).

      
        
           

        

        
          -4-

          
            

          

        

        
           

        

      

       

      
        (d)          Other Termination
Events.  Upon the termination of the Term of Employment by the
Company for Cause, by Employee for any reason (other than for Good Reason), or
by reason of his death or Disability, the Company shall have no further
obligations under this Agreement, except the Company shall:

        

        (i)       pay
Employee his unpaid Base Salary through, and any unpaid reimbursable expenses
outstanding as of, the effective date of such termination;

        

        (ii)      pay
all benefits (including all accrued but unpaid vacation pay), if any, that had
accrued to Employee through the date of termination under the benefit and
retirement plans and programs in which he participated as an employee of the
Company in the manner and in accordance with the terms of such plans and
programs; and

        

        (iii)     afford
Employee and his family such rights granted by the COBRA.

        

        (e)          Return or
Destruction.  Upon termination of the Term of Employment,
Employee shall not remove from any premises at which the business of the Company
is conducted any property of the Company, including without limitation, any
trade secrets or other confidential information, and shall return all the
property of the Company, including, without limitation, all tangible embodiments
of the trade secrets or other confidential information, in his possession or
under his control.

        

        6.  
        Non-Competition.  During
the Term of Employment and for a period of two (2) years following the
expiration or termination of the Term of Employment for any reason, except
termination without Good Cause or for Good Reason, in which case twelve (12)
months, Employee shall not, anywhere in the Geographic Area (as defined below),
other than on behalf of Company or with the prior written consent of Company,
directly or indirectly, perform services for (whether as an employee, agent,
consultant, advisor, independent contractor, owner, principal, proprietor,
partner, officer, director or otherwise), have any ownership interest in (except
for passive ownership of five percent (5%) or less of any entity whose
securities have been registered under the Securities Act or Section 12 of the
Securities Exchange Act of 1934, as amended), or participate or engage in the
financing, operation, management or control of, any firm, partnership,
corporation, entity or business that engages or participates in a “competing
business purpose” (as defied below).

        

        For the
purpose of this Agreement, the term “competing business
purpose” shall mean any business which is competitive with the business
of the company and its affiliates during the term of this Agreement. The term
“Geographic
Area” shall mean any geographic area in which the Company or any of its
affiliates or subsidiaries conduct business.

        

        The
covenants contained in this Section 6 shall be construed as a series of separate
covenants, one for each county, city, state, or any similar subdivision in any
Geographic Area. Except for geographic coverage, each such separate covenant
shall be deemed identical in terms to the covenants contained in the preceding
Sections. If, in any judicial proceeding, a court refuses to enforce any of such
separate covenants (or any part thereof), then such unenforceable covenant (or
such part) shall be eliminated from this Agreement to the extent necessary to
permit the remaining separate covenants (or portions thereof) to be enforced. In
the event that the provisions of this Section 8 are deemed to exceed the time,
geographic or scope limitations permitted by applicable law, then such
provisions shall be reformed to the maximum time, geographic or scope
limitations, as the case may be, permitted by applicable laws.

         

        
          
            
            

          

          
            -5-

            
              

            

          

          
            
            

          

        

         

        7.           Non-Solicitation.  During
the Term of Employment and for a period of two (2) years following the
expiration or termination of the Term of Employment for any reason, except
termination without Cause or for Good Reason, in which case, twelve (12) months,
Employee shall not, directly or indirectly, on his own behalf or in the service
or on behalf of others:

        

        (a)       
 solicit, induce or divert or attempt to solicit, induce or divert any
customer, potential customer, supplier, licensee, licensor, vendor or other
business relation of Company to cease doing business with Company, or in any way
interfere with the relationship between any customer, potential customer,
supplier, licensee, licensor, vendor or other business relation of Company or
solicit the business of any customer of Company. “Customer” means any individual
or entity have a current business relationship with the Company during the year
prior to the termination of his employment relationship with the Company
“Potential Customer” is defined as any individual or entity which has been
solicited with the intent of sales by the Company during the year prior to the
termination of his employment relationship with the Company.; and

        

        (b)    
    solicit, induce or divert, or take any action which is
intended to solicit, induce or divert, or has the effect of soliciting, inducing
or diverting, any employee, consultant or independent contractor of Company or
any of its subsidiaries or affiliates to terminate his or his employment or
other relationship with Company or its subsidiary or affiliate, other than in
the discharge of his duties as an officer of the Company, or hire or attempt to
hire any such employee, consultant or independent contractor.

        

        8.       
   Confidential
Information.

        

        (a)        As
used in this Agreement, “Confidential
Information,” shall mean any and all confidential and proprietary
technical and non-technical information of the Company or any of its
subsidiaries or affiliates, including patent, copyright, trade secret, and
proprietary information, techniques, sketches, drawings, models, inventions,
know-how, processes, apparatus, equipment, algorithms, software programs,
software source documents, and formulae related to the current, future and
proposed products and services of the Company or any of its subsidiaries or
affiliates and any suppliers or customers of the Company or any of its
subsidiaries or affiliates, and includes, without limitation, innovations,
tangible and intangible property, information of the Company or any of its
subsidiaries or affiliates concerning research, experimental work, development
design details and specifications, engineering, financial information,
procurement requirements, purchasing manufacturing, customer lists, business
forecasts, vendors, supplier agreements, sales, merchandising and marketing
plans and information.

         

        
          
            
            

          

          
            -6-

            
              

            

          

          
            
            

          

        

      

       

      (b)      
 During the Term of Employment and for twenty-four (24) months after the
expiration or termination of the Term of Employment, Employee shall hold and
safeguard the Confidential Information in trust for the Company, its successors
and assigns and agrees that he shall not use, without the prior written consent
of the Company, for Employee’s own benefit or purposes or misappropriate or
disclose or make available to any Person for use outside the Company’s
organization at any time, either during his employment with the Company or
subsequent to the termination of his employment with the Company during the
24-month period following such termination, for any reason, any of the
Confidential Information or any copy, notes or item embodying Confidential
Information, whether or not developed by Employee, except (i) as required in the
performance of Employee’s employment duties and as authorized by the Company and
(ii) to the extent that such information (A) is or becomes generally available
to the public or the industry other than as a result of a disclosure by Employee
in violation of this Agreement or (B) is required to be disclosed pursuant to a
court order or other legal process (provided Employee gives the Company notice
of such obligation as soon as practical after Employee receives notice of such
obligation and prior to any disclosure pursuant to such obligation, affords the
Company the opportunity and reasonably cooperates with the Company in any
efforts by the Company to limit the scope of such obligation and/or to obtain
confidential treatment of any material disclosed pursuant to such
obligation).

      

      9.          
Equitable
Remedies. Employee acknowledges and agrees that the agreements and
covenants set forth in Sections 6, 7, and are reasonable in scope and essential
for the protection of the Company’s business interests, that irreparable injury
will result to the Company if Employee breaches any of the terms of said
covenants, and that in the event of Employee’s actual or threatened breach of
any such covenants, the Company will have no adequate remedy at law. Employee
accordingly agrees that, in the event of any actual or threatened breach by
Employee of any of said covenants, the Company will be entitled to seek
immediate injunctive and other equitable relief, without bond and without the
necessity of showing actual monetary damages. Nothing in this Section 9 will be
construed as prohibiting the Company from pursuing any other remedies available
to it for such breach or threatened breach, including the recovery of any
damages that it is able to prove.

      

      10.         Dispute Resolution.
In the event of any dispute or claim relating to or arising out of this
Agreement (including, but not limited to, any claims of breach of contract,
wrongful termination or age, sex, race or other discrimination), Employee and
the Company agree that all such disputes shall be fully and finally resolved by
binding arbitration conducted by the American Arbitration Association in
Chicago, Illinois in accordance with its National Employment Dispute Resolution
rules, as those rules are currently in effect (and not as they may be modified
in the future). Any award rendered by the arbitrator shall be final and binding
and may be entered by any court having jurisdiction thereof. Employee
acknowledges that by accepting this arbitration provision he is waiving any
right to a jury trial in the event of such dispute. Notwithstanding the
foregoing, this arbitration provision shall not apply to (i) any equitable
remedies which the Company may seek in connection with Employee’s breach or
alleged breach of any covenant or agreement in Sections 6, 7, 8, or 9 above or
(ii) any disputes or claims relating to or arising out of the misuse or
misappropriation of trade secrets or proprietary information.

      

      11.         Governing Law. THIS
AGREEMENT AND ALL RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE
CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF ILLINOIS
WITHOUT REFERENCE TO ANY CONFLICTS OR CONFLICT OF LAWS PRINCIPLES IN THE STATE
OF ILLINOIS THAT WOULD RESULT IN THE APPLICATION OF THE LAW OF ANY OTHER
JURISDICTION.

       

      
        
          
          

        

        
          -7-

          
            

          

        

        
          
          

        

      

       

      12.         Successors and
Assigns.  This Agreement shall inure to the benefit of and be
binding upon the Company and its successors and assigns, provided that successor
or assignee is the successor to substantially all of the assets of the Company,
or a majority of its then outstanding Units, and that such successor or assignee
assumes the liabilities, obligations and duties of the Company under this
Agreement, either contractually or as a matter of law. In view of the personal
nature of the services to be performed under this Agreement by Employee, she
shall not have the right to assign or transfer any of his rights, obligations or
benefits under this Agreement, except as otherwise noted herein.

      

      13.         Severability.   Each
section and subsection of this Agreement constitutes a separate and distinct
provision of this Agreement. It is the intent of the parties that the provisions
of this Agreement be enforced to the fullest extent permissible under the laws
and public policies applicable in each jurisdiction in which enforcement is
sought. Accordingly, if any provision of this Agreement is adjudicated to be
invalid, ineffective or unenforceable, the remaining provisions will not be
affected by such adjudication. The invalid, ineffective or unenforceable
provision, without further action by the parties, will be automatically amended
to effect the original purpose and intent of the invalid, ineffective or
unenforceable provision; provided, however, that such
amendment will apply only with respect to the operation of such provision in the
particular jurisdiction with respect to which such adjudication is
made.

      

      14.         Entire
Agreement.  This Agreement, including the Exhibits attached
hereto, constitutes the entire agreement between Employee and the Company
regarding the terms and conditions of his employment. This Agreement supersedes
all prior negotiations, representations or agreements between Employee and the
Company, whether written or oral, concerning Employee’s employment.

      

      15.         No Conflict. Employee
represents and warrants to the Company that neither his entry into this
Agreement nor his performance of his obligations hereunder will conflict with or
result in a breach of the terms, conditions or provisions of any other agreement
or obligation to which Employee is a party or by which Employee is bound,
including without limitation, any non-competition or confidentiality agreement
previously entered into by Employee.

      

      16.         Survival of Certain
Obligations. The obligations of the Company and Employee set forth in
this Agreement that by their terms extend beyond or survive the termination of
this Agreement will not be affected or diminished in any way by the termination
of the Term of Employment.

      

      17.         Amendments. This
Agreement may not be modified or amended except by a written agreement signed by
Employee and the Company.

      

      18.         Legal Counsel. Each
party hereby agrees and acknowledges that it has had full opportunity to consult
with counsel and tax advisors of its selection in connection with the
preparation and negotiation of this Agreement.

      

      [Signature Page
Follows]

      
        
           

        

        
          -8-

          
            

          

        

        
           

        

      

       

      IN
WITNESS WHEREOF, the parties have executed this Agreement as of  the
date and year written below.

      

      
        
          
            
              
                
                  
                    
                      	 
      	
                              COMPANY:

                            
	 
      	 
      
	 
      	
                              INNERWORKINGS,
      INC.

                            
	 
      	 
      
	 
      	
                              By:

                            	
                              /s/
      Nicholas Galassi

                            
	 
      	 
      	 
      
	 
      	
                              EMPLOYEE:

                            
	 
      	 
      
	 
      	
                              /s/ Joanathan
      Shean  

                            
	 
      	
                              Jonathan
      Shean

                            
	 	 
	 	 

                    

                  

                

              

            

          

        

      

       

      -9-Exhibit
10.1

    

    EXECUTION
VERSION

    
      
        
          	
                    
      

                

        

      

    

     

    SECOND
AMENDED AND RESTATED CREDIT AGREEMENT

     

    among

     

    BREITBURN
OPERATING L.P.

    as
the borrower

     

    and

     

    BREITBURN ENERGY PARTNERS
L.P.,

    as
parent guarantor

     

    WELLS FARGO BANK, NATIONAL
ASSOCIATION,

    as
administrative agent,

    Swing
line lender and issuing lender

     

    AND THE FINANCIAL INSTITUTIONS FROM
TIME TO TIME PARTY HERETO,

    as
lenders

    

    
      
        

      

       

    

    BANK OF MONTREAL
and

    THE
BANK OF NOVA SCOTIA

    co-syndication
agents

    

    BNP PARIBAS and

    UNION
BANK, N.A.

    co-documentation
agents

     

    
      
        

      

    

     

    WELLS
FARGO SECURITIES, LLC

    Sole
Lead Arranger

    
      
        

      

       

    

    Dated
as of May 7, 2010

    
      
        
          	
                    
      

                

        

      

    

     

    
      
        
           

        

        
          
          

          
            

          

        

        
           

        

      

    

    

    TABLE OF
CONTENTS

     

    
      
        
          
            
              
                
                  
                    
                      
                        	 
      	 	
                                PAGE

                              	 
	
                                ARTICLE I.
      DEFINITIONS

                              	 	 	1	 
	
                                1.01   Certain Defined
      Terms

                              	 	 	1	 
	
                                1.02   Other Interpretive
      Provisions

                              	 	 	21	 
	
                                1.03   Accounting
      Principles

                              	 	 	22	 
	 	 	 	 	 
	
                                ARTICLE
      II. THE
      CREDIT

                              	 	 	22	 
	
                                2.01   Amounts and Terms of the
      Commitments.

                              	 	 	22	 
	
                                2.02   Procedure for
      Borrowings.

                              	 	 	23	 
	
                                2.03   Conversion and Continuation
      Elections.

                              	 	 	23	 
	
                                2.04   Optional Commitment Reductions
      and Optional Prepayments.

                              	 	 	24	 
	
                                2.05   Borrowing Base Determinations;
      Mandatory Prepayments of Loans.

                              	 	 	25	 
	
                                2.06   Repayment.

                              	 	 	27	 
	
                                2.07   Fees.

                              	 	 	27	 
	
                                2.08   Computation of Fees and
      Interest.

                              	 	 	28	 
	
                                2.09   Payments by the Company;
      Borrowings Pro Rata.

                              	 	 	29	 
	
                                2.10   Issuing the Letters of
      Credit.

                              	 	 	29	 
	
                                2.11   Payments to the Administrative
      Agent; Several Obligations of the Lenders.

                              	 	 	33	 
	
                                2.12   Sharing of
      Payments

                              	 	 	34	 
	
                                2.13   Swing Line
      Loans.

                              	 	 	34	 
	
                                2.14   Special Provisions Applicable
      to BEP I.

                              	 	 	37	 
	
                                2.15   Defaulting
      Lenders.

                              	 	 	37	 
	 	 	 	 	 
	
                                ARTICLE III.
      TAXES, YIELD PROTECTION AND ILLEGALITY;  REPLACEMENT OF
      LENDERS

                              	 	 	39	 
	
                                3.01   Taxes.

                              	 	 	39	 
	
                                3.02   Illegality.

                              	 	 	41	 
	
                                3.03   Increased Costs and Reduction
      of Return.

                              	 	 	42	 
	
                                3.04   Funding
      Losses

                              	 	 	43	 
	
                                3.05   Inability to Determine
      Rates

                              	 	 	43	 
	
                                3.06   Certificates of
      Lenders

                              	 	 	43	 
	
                                3.07   Mitigation Obligations;
      Replacement of Lenders.

                              	 	 	44	 
	
                                3.08   Survival

                              	 	 	44	 
	 	 	 	 	 
	
                                ARTICLE
      IV.
      SECURITY

                              	 	 	45	 
	
                                4.01   The
    Security

                              	 	 	45	 

                      

                    

                  

                

              

            

          

        

      

    

     

    
      

        
          

        

      

      
        Second Amended and Restated Credit
Agreement – BreitBurn Operating L.P.

      

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                            4.02   Agreement to Deliver Security
      Documents

                          	 	 	45	 
	
                            4.03   Perfection and Protection of
      Security Interests and Liens

                          	 	 	45	 
	
                            4.04   Offset

                          	 	 	45	 
	
                            4.05   Subsidiary Guaranty and
      Security Agreement.

                          	 	 	46	 
	 	 	 	 	 
	
                            ARTICLE V.
      CONDITIONS PRECEDENT

                          	 	 	46	 
	
                            5.01   Conditions of Initial Credit
      Extensions

                          	 	 	46	 
	
                            5.02   Conditions to Extensions of
      Credit

                          	 	 	48	 
	 	 	 	 	 
	
                            ARTICLE VI.
      REPRESENTATIONS AND WARRANTIES

                          	 	 	48	 
	
                            6.01   Organization, Existence and
      Power

                          	 	 	48	 
	
                            6.02   Corporate Authorization; No
      Contravention

                          	 	 	49	 
	
                            6.03   Governmental
      Authorization

                          	 	 	49	 
	
                            6.04   Binding
      Effect

                          	 	 	49	 
	
                            6.05   Litigation

                          	 	 	49	 
	
                            6.06   No
    Default

                          	 	 	49	 
	
                            6.07   ERISA
      Compliance

                          	 	 	50	 
	
                            6.08   Margin
      Regulations

                          	 	 	50	 
	
                            6.09   Title to
      Properties

                          	 	 	50	 
	
                            6.10   Oil and Gas
      Reserves

                          	 	 	51	 
	
                            6.11   Initial Reserve
      Report

                          	 	 	51	 
	
                            6.12   Gas
      Imbalances

                          	 	 	51	 
	
                            6.13   Taxes

                          	 	 	52	 
	
                            6.14   Financial
      Condition.

                          	 	 	52	 
	
                            6.15   Environmental
      Matters

                          	 	 	52	 
	
                            6.16   Regulated
      Entities

                          	 	 	53	 
	
                            6.17   No Burdensome
      Restrictions

                          	 	 	53	 
	
                            6.18   Copyrights, Patents, Trademarks
      and Licenses, Etc

                          	 	 	53	 
	
                            6.19   Subsidiaries and Other Equity
      Interests

                          	 	 	54	 
	
                            6.20   Insurance

                          	 	 	54	 
	
                            6.21   Derivative
      Contracts

                          	 	 	54	 
	
                            6.22   Full
      Disclosure

                          	 	 	54	 
	
                            6.23   Solvency.

                          	 	 	54	 
	 	 	 	 	 
	
                            ARTICLE VII.
      AFFIRMATIVE COVENANTS

                          	 	 	54	 
	
                            7.01   Financial
      Statements

                          	 	 	55	 
	
                            7.02   Certificates; Other Production
      and Reserve Information

                          	 	 	56	 

                  

                

              

            

          

        

      

    

    
      

      

        
          

        

      

      
        Second Amended and Restated Credit
Agreement – BreitBurn Operating L.P.

      

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                        7.03   Notices

                      	 	 	58	 
	
                        7.04   Preservation of Company
      Existence, Etc.

                      	 	 	58	 
	
                        7.05   Maintenance of
      Property.

                      	 	 	59	 
	
                        7.06   Title
      Information

                      	 	 	59	 
	
                        7.07   Additional
      Collateral

                      	 	 	59	 
	
                        7.08   Insurance

                      	 	 	60	 
	
                        7.09   Payment of
      Obligations

                      	 	 	60	 
	
                        7.10   Compliance with
      Laws

                      	 	 	60	 
	
                        7.11   Compliance with
      ERISA

                      	 	 	60	 
	
                        7.12   Inspection of Property and
      Books and Records

                      	 	 	60	 
	
                        7.13   Environmental
      Laws.

                      	 	 	61	 
	
                        7.14   Pledge of Equity in New
      Subsidiary

                      	 	 	61	 
	
                        7.15   New Subsidiary
      Guarantors

                      	 	 	61	 
	
                        7.16   Use of
      Proceeds

                      	 	 	61	 
	
                        7.17   Operating
      Accounts

                      	 	 	62	 
	
                        7.18   Phase I
      Reports

                      	 	 	62	 
	
                        7.19   Further
      Assurances.

                      	 	 	62	 
	 	 	 	 	 
	
                        ARTICLE VIII.
      NEGATIVE COVENANTS

                      	 	 	62	 
	
                        8.01   Limitation on
      Liens

                      	 	 	63	 
	
                        8.02   Disposition of
      Assets

                      	 	 	64	 
	
                        8.03   Consolidations and
      Mergers

                      	 	 	65	 
	
                        8.04   Loans and
      Investments

                      	 	 	65	 
	
                        8.05   Limitation on
      Indebtedness

                      	 	 	67	 
	
                        8.06   Transactions with
      Affiliates

                      	 	 	68	 
	
                        8.07   Margin
    Stock

                      	 	 	68	 
	
                        8.08   Contingent
      Obligations

                      	 	 	68	 
	
                        8.09   Restricted
      Payments

                      	 	 	69	 
	
                        8.10   Derivative
      Contracts

                      	 	 	69	 
	
                        8.11   Change in Business; Amendments
      to Organization Documents and Certain Acquisition Agreements; Corporate
      Structure; Tax
      Status.

                      	 	 	70	 
	
                        8.12   Accounting
      Changes

                      	 	 	71	 
	
                        8.13   ERISA
      Compliance

                      	 	 	71	 
	
                        8.14   Interest Coverage
      Ratio

                      	 	 	72	 
	
                        8.15   Leverage
      Ratio

                      	 	 	72	 
	
                        8.16   Current
      Ratio

                      	 	 	72	 

              

            

          

        

      

    

     

    
      

        
          

        

      

      
        Second Amended and Restated Credit
Agreement – BreitBurn Operating L.P.

      

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                            8.17   Negative
      Pledge

                          	 	 	72	 
	
                            8.18   Unrestricted
      Entities.

                          	 	 	72	 
	 	 	 	 	 
	
                            ARTICLE IX.
      EVENTS OF DEFAULT

                          	 	 	72	 
	
                            9.01   Event of
      Default

                          	 	 	72	 
	
                            9.02   Remedies

                          	 	 	74	 
	
                            9.03   Rights Not
      Exclusive

                          	 	 	76	 
	
                            9.04   Lender and Lender Derivative
      Provider Action

                          	 	 	76	 
	 	 	 	 	 
	
                            ARTICLE X.
      ADMINISTRATIVE AGENT

                          	 	 	77	 
	
                            10.01   Appointment and
      Authority

                          	 	 	77	 
	
                            10.02   Rights as a
      Lender

                          	 	 	77	 
	
                            10.03   Exculpatory
      Provisions

                          	 	 	77	 
	
                            10.04   Reliance by Administrative
      Agent

                          	 	 	78	 
	
                            10.05   Delegation of
      Duties

                          	 	 	78	 
	
                            10.06   Resignation of Administrative
      Agent

                          	 	 	78	 
	
                            10.07   Non-Reliance on Administrative
      Agent and Other Lenders

                          	 	 	79	 
	
                            10.08   Administrative Agent May File
      Proofs of Claim

                          	 	 	79	 
	
                            10.09   Authority of Administrative
      Agent to Release Collateral and Liens

                          	 	 	80	 
	
                            10.10   The Arrangers and other
      Agents

                          	 	 	80	 
	 	 	 	 	 
	
                            ARTICLE XI.
      MISCELLANEOUS

                          	 	 	80	 
	
                            11.01   Amendments and
      Waivers

                          	 	 	80	 
	
                            11.02   Notices; Effectiveness;
      Electronic Communication.

                          	 	 	81	 
	
                            11.03   No Waiver; Cumulative
      Remedies.

                          	 	 	82	 
	
                            11.04   Costs and Expenses;
      Indemnity.

                          	 	 	83	 
	
                            11.05   Payments Set
      Aside

                          	 	 	84	 
	
                            11.06   Successors and
      Assigns.

                          	 	 	85	 
	
                            11.07   Confidentiality

                          	 	 	88	 
	
                            11.08   Right of
      Set-off

                          	 	 	88	 
	
                            11.09   Interest.

                          	 	 	89	 
	
                            11.10   Indemnity and
      Subrogation

                          	 	 	89	 
	
                            11.11   Collateral Matters; Derivative
      Contracts; Termination.

                          	 	 	90	 
	
                            11.12   Renewal and Continuation of
      Existing Indebtedness.

                          	 	 	90	 
	
                            11.13   USA Patriot Act
      Notice

                          	 	 	91	 
	
                            11.14   Automatic Debits of
      Fees

                          	 	 	91	 
	
                            11.15   Counterparts

                          	 	 	91	 

                  

                

              

            

          

        

      

    

    
      

      

        
          

        

      

      
        Second Amended and Restated Credit
Agreement – BreitBurn Operating L.P.

      

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                      11.16   Severability

                    	 	 	91	 
	
                      11.17   No Third Parties
      Benefited

                    	 	 	91	 
	
                      11.18   Entire
      Agreement

                    	 	 	91	 
	
                      11.19   Governing Law, Jurisdiction and
      Waiver of Jury Trial

                    	 	 	91	 
	
                      11.20   California Judicial
      Reference

                    	 	 	92	 
	
                      11.21   NO ORAL
      AGREEMENTS

                    	 	 	93	 

            

          

        

      

    

     

    
      
        
          	
                  SCHEDULES

                	 
      
	
                  Schedule
      2.01

                	
                  Commitments

                
	
                  Schedule
      4.01

                	
                  Security
      Documents

                
	
                  Schedule
      6.07

                	
                  ERISA
      Compliance

                
	
                  Schedule
      6.09

                	
                  Title
      to Properties

                
	
                  Schedule
      6.13

                	
                  Tax
      Matters

                
	
                  Schedule
      6.15

                	
                  Environmental
      Matters

                
	
                  Schedule
      6.19

                	
                  Subsidiaries

                
	
                  Schedule
      6.21

                	
                  Derivative
      Contracts

                
	
                  Schedule
      8.01

                	
                  Liens

                
	
                  Schedule
      8.04

                	
                  Investments

                
	
                  Schedule
      8.05

                	
                  Indebtedness

                
	
                  Schedule
      8.08

                	
                  Contingent
      Obligations

                
	
                  Schedule
      11.02

                	
                  Lending
      Offices; Addresses for Notices

                
	 
      	 
      
	
                  EXHIBITS

                	 
      
	 
      	 
      
	
                  Exhibit
      A-1

                	
                  Form
      of Notice of Revolving Credit Borrowing

                
	
                  Exhibit
      A-2

                	
                  Form
      of Notice of Swing Line Borrowing

                
	
                  Exhibit
      B

                	
                  Form
      of Notice of Conversion/Continuation

                
	
                  Exhibit
      C

                	
                  Form
      of Compliance Certificate

                
	
                  Exhibit
      D

                	
                  Form
      of Assignment and Assumption Agreement

                
	
                  Exhibit
      E

                	
                  Form
      of Note

                
	
                  Exhibit
      F

                	
                  Form
      of Pricing Grid Certificate

                
	
                  Exhibit
      G

                	
                  Form
      of Continuing Guaranty Agreement (Subsidiaries)

                
	
                  Exhibit
      H

                	
                  Form
      of Security Agreement

                

        

      

    

    

    

      
        

      

    

    
      Second Amended and Restated Credit
Agreement – BreitBurn Operating L.P.

    

     Page 
v

    

    
      
        
           

        

        
          
          

          
            

          

        

        
           

        

      

    

    

    SECOND AMENDED AND RESTATED
CREDIT AGREEMENT

     

    THIS SECOND AMENDED AND RESTATED
CREDIT AGREEMENT is dated as of May 7, 2010, among BREITBURN OPERATING L.P., a
Delaware limited partnership (the “Company”),
BREITBURN ENERGY PARTNERS,
L.P., a Delaware limited partnership (“Parent”),
each of the financial institutions from time to time party hereto (individually,
a “Lender”
and collectively, the “Lenders”),
and WELLS FARGO BANK, NATIONAL
ASSOCIATION, as administrative agent for the Lenders (in such capacity,
together with its successors in such capacity, the “Administrative
Agent”), as Swing Line Lender (in such capacity, “Swing Line
Lender”), and as Issuing Lender (in such capacity, “Issuing
Lender”).

     

    RECITALS

     

    A.        
The Company, Parent, certain Subsidiaries of the Company, the Administrative
Agent and other lenders and agents are parties to that certain Amended and
Restated Credit Agreement dated as of November 1, 2007 as amended by the
First Amendment dated as of June 17, 2008 (the “Existing Credit
Agreement”);

     

    B.           The
parties desire to amend and restate the Existing Credit Agreement in its
entirety as set forth herein, with such amendment and restatement to be
effective as of the Effective Date; and

     

    C.           The
amendment and restatement of the Existing Credit Agreement is not intended by
the parties hereto to constitute a novation, or discharge or a satisfaction of
Indebtedness outstanding under the Existing Credit Agreement, which Indebtedness
shall remain outstanding as amended and restated hereunder pursuant to the terms
and conditions of this Agreement;

     

    D.           NOW
THEREFORE, in consideration of the foregoing recitals, of the representations,
warranties, covenants and agreements contained herein, and other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereto agree that the Existing Credit Agreement is
amended and restated to read in its entirety as follows:

     

    ARTICLE
I.

     

    DEFINITIONS

     

    
      1.01           Certain
Defined Terms.  The
following terms have the following meanings:

       

      “Acquisition”
means any transaction or series of related transactions for the purpose of or
resulting, directly or indirectly, in (a) the acquisition of all or
substantially all of the assets of a Person, or of any business unit or division
of a Person, (b) the acquisition of in excess of 50% of the capital stock of a
corporation (or similar entity), which stock has ordinary voting power for the
election of the members of such entity’s board of directors or persons
exercising similar functions (other than stock having such power only by reason
of the happening of a contingency), or the acquisition of in excess of 50% of
the partnership interests or equity of any Person not a corporation which
acquisition gives the acquiring Person the power to direct or cause the
direction of the management and policies of such Person, or (c) a merger or
consolidation or any other combination with another Person (other than a Person
that is a Subsidiary) provided that the
Company or a Subsidiary of the Company is the surviving entity.

       

      “Administrative
Agent” has the meaning specified in the introductory clause
hereto.

      

        

        

          
            

          

        

        
          Second Amended and Restated Credit
Agreement – BreitBurn Operating L.P.

        

      

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      “Administrative
Agent’s Payment Office” means the address for payments as the
Administrative Agent may from time to time specify.

       

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

       

      “Affiliate”
means, as to any Person, any other Person which, directly or indirectly, is in
control of, is controlled by, or is under common control with, such Person. A
Person shall be deemed to control another Person if the controlling Person
possesses the power to direct or cause the direction of the management and
policies of the other Person, whether through the ownership of voting
securities, by contract, or otherwise.

       

      “Aggregate Maximum
Credit Amount” means the amount of $1,500,000,000.00.

       

      “Agreement”
means this Second Amended and Restated Credit Agreement, as the same may from
time to time be amended, supplemented and restated.

       

      “Applicable
Margin” means, with respect to Base Rate Loans and LIBOR Loans, the
respective margins therefor as determined under the Pricing Grid.

       

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

       

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

       

      “Assumed
Indebtedness” means Indebtedness of a Person which (a) is in existence at
the time such Person becomes a Subsidiary, or (b) is assumed in connection with
an investment in or acquisition of such Person, and has not been incurred or
created by such Person solely in contemplation of such Person becoming a
Subsidiary.

       

      “Availability
Period” has the meaning specified in Section
2.01(c).

       

      “Available
Borrowing Base” means, at the particular time in question, the Borrowing
Base then in effect minus the Effective
Amount at such time.

       

      “Available
Cash” means, with respect to Parent, “Available Cash” as defined in
Parent’s partnership agreement on the Effective Date, as such definition may be
amended in a manner reasonably acceptable to the Administrative
Agent.

       

      “Bankruptcy
Code” means the Federal Bankruptcy Reform Act of 1978 (11 U.S.C. §101,
et seq.), as
amended, and regulations promulgated thereunder.

       

      “Base Rate”
means, for any day, the fluctuating rate of interest in effect for such day
which rate per annum shall be equal to the greatest of (a) the rate of interest
as publicly announced from time to time by Administrative Agent as its “reference rate,” (b) one-half
of one percent (0.50%) per annum above the Federal Funds Rate in effect from
time to time, and (c) the LIBOR for a one month Interest Period on such day (or
if such day is not a Business Day, the immediately preceding Business Day) plus
one percent (1.00%).  (The “reference rate” is a rate set
by Administrative Agent based upon various factors including costs and desired
return, general economic conditions and other factors, and is used as a
reference point for pricing some loans, which may be priced at, above, or below
such announced rate.)  Any change in the reference rate announced by
Administrative Agent, LIBOR or the Federal Funds Rate shall take effect on the
effective date of such change in the reference rate announced by Administrative
Agent, LIBOR or the Federal Funds Rate.

      
        

        

          
            

          

        

        
          Second Amended and Restated Credit
Agreement – BreitBurn Operating L.P.

        

         Page
2

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      “Base Rate
Loan” means a Loan that bears interest based at the Base Rate plus the Applicable
Margin.

       

      “BEP I”
means BreitBurn Energy Partners I, L.P., a Texas limited
partnership.

       

      “BEP I
Default”
has the meaning set forth in Section
2.14(a).

       

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

       

      “Borrowing
Base” means at the particular time in question, the amount provided for
in Section
2.05 provided, however, in no event shall the Borrowing Base ever exceed
the Aggregate Maximum Credit Amount.

       

      “Borrowing Base
Deficiency” means at any time, the Effective Amount exceeds the Borrowing
Base then in effect.

       

      “Borrowing Base
Period” means the period from the Effective Date to the initial Scheduled
Borrowing Base Determination Date, and thereafter, each six-month period between
Scheduled Borrowing Base Determination Dates.

       

      “Borrowing
Date”
means any date on which a Borrowing occurs under Section
2.02.

       

      “Business
Day” means any day other than a Saturday, Sunday or other day on which
commercial banks in Houston, Texas, New York, New York, or San Francisco,
California are authorized or required by law to close and, if the applicable
Business Day relates to any LIBOR Loan, means such a day on which dealings are
carried on in the applicable offshore dollar interbank market.

       

      “Capital
Lease” means, when used with respect to any Person, any lease in respect
of which the obligations of such Person constitute Capitalized Lease Obligations
and the amount thereof shall be the capitalized amount thereof determined in
accordance with GAAP.

       

      “Capitalized Lease
Obligations” means, when used with respect to any Person, without
duplication, all 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 shall have been or should
be, in accordance with GAAP, capitalized on the books of such
Person.

      
        

        

          
            

          

        

        
          Second Amended and Restated Credit
Agreement – BreitBurn Operating L.P.

        

         Page
3

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      “Cash
Equivalents” means:  (a) securities issued or fully guaranteed
or insured by the United States Government or any agency thereof and backed by
the full faith and credit of the United States and having maturities of not more
than twelve (12) months from the date of acquisition; (b) certificates of
deposit, time deposits, eurodollar time deposits, or bankers’ acceptances having
in each case a tenor of not more than twelve (12) months from the date of
acquisition issued by, and demand deposits with, any U.S. commercial bank or any
branch or agency of a non-U.S. commercial bank licensed to conduct business in
the U.S. having combined capital and surplus of not less than $500,000,000,
whose long term securities are rated at least A (or then equivalent grade) by
S&P and A2 (or then equivalent grade) by Moody’s at the time of acquisition;
(c) commercial paper of an issuer rated at least A-1 by S&P or P-1 by
Moody’s at the time of acquisition, and in either case having a tenor of not
more than twelve (12) months; (d) debt securities which are registered under the
Securities Act of 1933, as amended (the “Securities Act”) (and not
“restricted securities”
in the Company’s hands as defined in Rule 144 under the Securities Act), or
adjustable rate preferred stock traded on a national securities exchange and
issued by a corporation duly incorporated under the laws of a state of the
United States, or issued by any state, county or municipality located in the
United States of America, provided, however, that such debt securities are rated
A2 by Moody’s and A or better by S&P at the time of acquisition, and such
debt securities have a maturity not in excess of twelve (12) months from the
date of creation thereof; (e) repurchase agreements with a term of not more than
seven (7) days for underlying securities of the types described in clauses (a)
and (b) above; and (f) money market mutual or similar funds having assets in
excess of $100,000,000.

       

      “Casualty
Event” means any loss, casualty or other insured damage to, or any
nationalization, taking under power of eminent domain or by condemnation or
similar proceeding of, any Property of the Company or any of its Subsidiaries
having a fair market value in excess of $10,000,000.

       

      “Change in
Law” means the occurrence, after the date of this Agreement, of any of
the following: (a) the adoption or taking effect of any law, rule, regulation or
treaty, (b) any change in any law, rule, regulation or treaty or in the
administration, interpretation or application thereof by any Governmental
Authority or (c) the making or issuance of any request, guideline or directive
(whether or not having the force of law) by any Governmental
Authority.

       

      “Change of
Control”
means

      

      (a)           General
Partner shall cease to own, directly or indirectly, all of the general partner
interest (including without limitation, all outstanding securities convertible
to general partner interests) of the Company; or BreitBurn GP LLC shall cease to
own, directly or indirectly, all of the general partner interest (including
without limitation, all outstanding securities convertible to general partner
interests) of Parent; or

       

      (b)           Parent
shall cease to own, directly or indirectly, all of the limited partnership
interests (including without limitation, all outstanding Equity convertible to
limited partner interests) of the Company, or shall cease to own, directly or
indirectly, all of the general partnership interest (including without
limitation, all outstanding Equity convertible to general partner interests) of
the Company, or shall cease to own, directly or indirectly, at least 51% of the member
interest (including without limitation, all outstanding Equity convertible to
limited partner interests) of BreitBurn GP LLC; or

       

      (c)           a
sale of all or substantially all of the assets of the Loan Parties taken as a
whole to any Person or group of Persons; or

       

      (d)           the
liquidation or dissolution of Parent or the Company; or

       

      (e)           any
“person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, but excluding any employee benefit plan of such
person or its subsidiaries, and any person or entity acting in its capacity as
trustee, agent or other fiduciary or administrator of any such plan) becomes the
“beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Securities
Exchange Act of 1934, except that a person or group shall be deemed to have
“beneficial ownership” of all securities that such person or group has the right
to acquire, whether such right is exercisable immediately or only after the
passage of time (such right, an “option right”)), directly or indirectly, of 50%
or more of the equity securities of the Parent  or of the general
partner of the Parent entitled to vote for members of the board of directors or
equivalent governing body of the Parent or the general partner of the Parent on
a fully-diluted basis (and taking into account all such securities that such
“person” or “group” has the right to acquire pursuant to any option right);
or

      

      

        
          

        

      

      
        Second Amended and Restated Credit
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      (f)           the
first day on which a majority of the Board of Directors of BreitBurn GP
LLC  are not Continuing Directors.  “Continuing
Directors” means any member of the board of directors (or managers, in
the case of a limited liability company) of BreitBurn GP LLC, who (A) is a
member of such board of directors or managers as of the date of this Agreement
or (B) was nominated for election or elected to such board of directors or
managers with the affirmative vote of two-thirds of the Continuing Directors who
were members of such board of directors or managers at the time of such
nomination or election (not including as board nominees any directors which the
board is obligated to nominate pursuant to shareholders’ agreements, voting
trust arrangements or similar arrangements).

       

      “Code”
means the Internal Revenue Code of 1986, as amended, and regulations promulgated
thereunder.

       

      “Collateral”
means all property of any kind which is subject to a Lien in favor of
Administrative Agent to secure the Obligations or which under the terms of any
Security Document is purported to be subject to such Lien.

       

      “Commitment”
means, as to each Lender, such Lender’s obligation to make Revolving Credit
Loans and to participate in Letters of Credit and Swing Line Loans up to such
Lender’s Pro Rata Share of the lesser of (a) the then-effective Borrowing Base
or (b) the Aggregate Maximum Credit Amount, as such commitment may be terminated
and/or reduced from time to time in accordance with the provisions
hereof.

       

      “Commitment
Fee” means the variable fee as determined by the Pricing Grid payable
pursuant to Section
2.07(a).

       

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

       

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

       

      “Consolidated
Interest Expense” means, with respect to the Loan Parties, for any fiscal
period, the aggregate amount of all costs, fees and expenses paid by the Loan
Parties in such fiscal period which are classified as interest expense on the
consolidated financial statements of the Loan Parties, all as determined in
conformity with GAAP.

       

      “Consolidated Net
Income” means, for any period, the net income (or net loss) of Parent and
its Consolidated Subsidiaries, on a consolidated basis, for such period
determined in accordance with GAAP; provided that (a) the effect, if any, of
non-cash gains, losses or adjustments under FAS 133 as a result of changes in
the fair market value of derivatives shall be excluded from the calculation of
net income (or net loss); and (b) there shall be excluded the net income of any
Subsidiary of Parent to the extent that the declaration or payment of dividends
or similar distributions by such Subsidiary is at the time restricted or not
permitted by the terms of any Contractual Obligation (other than under any Loan
Document) or Requirements of Law applicable to such Subsidiary.

       

      “Consolidated
Subsidiaries” of Parent means all Restricted Subsidiaries and
Unrestricted Entities that are consolidated in accordance with
GAAP.

      

      

        
          

        

      

      
        Second Amended and Restated Credit
Agreement – BreitBurn Operating L.P.

      

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      “Contingent
Obligation” means, as to any Person without duplication, any direct or
indirect liability of that Person with or without recourse, (a) with respect to
any Indebtedness, dividend, letter of credit or other similar obligation (the
“primary
obligations”) of another Person (the “primary
obligor”), including any obligation of that Person (i) to purchase,
repurchase or otherwise acquire such primary obligations or any security
therefor, (ii) to advance or provide funds for the payment or discharge of any
such primary obligation, or to maintain working capital or equity capital of the
primary obligor or otherwise to maintain the net worth or solvency or any
balance sheet item, level of income or financial condition of the primary
obligor, (iii) to purchase property, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the ability of
the primary obligor to make payment of such primary obligation, or (iv)
otherwise to assure or hold harmless the holder of any such primary obligation
against loss in respect thereof (each, a “Guaranty
Obligation”); (b) with respect to any Surety Instrument issued for the
account of that Person or as to which that Person is otherwise liable for
reimbursement of drawings or payments; or (c) to purchase any materials,
supplies or other property from, or to obtain the services of, another Person,
other than in the ordinary course of business, if the relevant contract or other
related document or obligation requires that payment for such materials,
supplies or other property, or for such services, shall be made regardless of
whether delivery of such materials, supplies or other property is ever made or
tendered, or such services are ever performed or tendered.  The amount
of any Contingent Obligation shall, in the case of Guaranty Obligations, be
deemed equal to the lesser of (a) the stated maximum amount, if any, of such
Contingent Obligation and (b) the maximum stated or determinable amount of the
primary obligation in respect of which such Guaranty Obligation is made or, if
not stated or if indeterminable, the maximum reasonably anticipated liability in
respect thereof, and in the case of other Contingent Obligations, shall be equal
to the lesser of (a) the stated maximum amount, if any, of such Contingent
Obligation and (b) the maximum reasonably anticipated liability in respect
thereof.

       

      “Continuing
Directors” has the meaning specified in the definition of “Change of
Control.”

       

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

       

      “Conversion/Continuation
Date” means any date on which, under Section
2.03, the Company (a) converts Base Rate Loans to LIBOR Loans, or (b)
continues as LIBOR Loans having Interest Periods expiring on such date as LIBOR
Loans, with a new Interest Period.

       

      “Credit
Extension” means and includes the making of any Loans or issuance of any
Letter of Credit (including the continuation of any Existing Letter of Credit)
hereunder.

       

      “Current
Assets” means, at any time, the current assets of the Parent and its
Consolidated Subsidiaries at such time which would be properly classified as
current assets in accordance with GAAP, plus, the Available
Borrowing Base at such time, less, for purposes of
this definition, any non-cash gains for any Derivative Contract resulting from
the requirements of FAS 133 at such time.

       

      “Current
Liabilities” means, at any time, the current liabilities of the Parent
and its Consolidated Subsidiaries at such time which would be properly
classified as current liabilities in accordance with GAAP, excluding (a) the
current portion of any maturities under this Agreement and (b) non-cash losses
or charges on any Derivative Contract resulting from the requirements of FAS 133
at such time.

      
        

        

          
            

          

        

        
          Second Amended and Restated Credit
Agreement – BreitBurn Operating L.P.

        

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      “Default”
means any event or circumstance which, with the giving of notice, the lapse of
time, or both, would (if not cured or otherwise remedied during such time)
constitute an Event of Default.

       

      “Default
Rate” means a rate per annum equal to the lesser of (a) the Highest
Lawful Rate and (b)(i) with respect to LIBOR Loans, the interest rate otherwise
applicable to such Loans plus 2% per annum,
(ii) with respect to Letter of Credit Fees, the rate otherwise applicable plus 2% per annum,
and (iii) with respect to all other Obligations other than (A) those included in
the preceding clauses (i) and (ii), and (B) Obligations under Lender Derivative
Contracts, the non-default interest rate then applicable to the Base Rate Loans
plus 2% per
annum.

       

      “Defaulting
Lender” means any Lender, as reasonably determined by the Administrative
Agent, that (a) has failed to fund any portion of its Loans within three (3)
Business Days of the date required to be funded by it hereunder, (b) has
notified the Company, the Administrative Agent or any Lender in writing that it
does not intend to comply with any of its funding obligations under this
Agreement or has made a public statement to the effect that it does not intend
to comply with its funding obligations under this Agreement or generally under
other agreements in which it commits to extend credit, (c) has failed, within
three (3) Business Days after request by the Administrative Agent, to confirm
that it will comply with the terms of this Agreement relating to its obligations
to fund prospective Loans, (d) has otherwise failed to pay over to the
Administrative Agent or any other Lender any other amount required to be paid by
it hereunder within three (3) Business Days of the date when due, unless the
subject of a good faith dispute, or (e) (i) has or has a parent company that has
become the subject of a bankruptcy or insolvency proceeding, or has had a
receiver, conservator, trustee, administrator, custodian, assignee for the
benefit of creditors or similar Person charged with reorganization or
liquidation of its business appointed for it, or (ii) has taken any action in
furtherance of, or indicating its consent to, approval of or acquiescence in any
such proceeding or appointment; provided that a Lender shall not be a Defaulting
Lender solely by virtue of the ownership or acquisition of any equity interest
in that Lender or any direct or indirect parent company thereof by a
Governmental Authority.

       

      “Derivative
Contract” means all futures contracts, forward contracts, swap, cap or
collar contracts, option contracts, hedging contracts or other derivative
contracts or similar agreements covering oil and gas commodities or prices or
financial, monetary or interest rate instruments, and any and all trades,
confirmations, and transactions entered into pursuant thereto.

       

      “Dispositions”
has the meaning specified in Section
8.02.

       

      “Dollars”,
“dollars”
and “$” each
mean lawful money of the United States.

       

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

       

      “EBITDAX”
means, for any period, the sum of Consolidated Net Income for such period (a)
plus,
without duplication, the following expenses or charges to the extent deducted in
the determination of Consolidated Net Income in such period: exploration
expense, interest expense, depletion, depreciation, amortization, unrealized
loss on Derivative Contracts, non-cash charges (including non-cash share-based
payments under FASB Statement No. 123R), loss on sale of assets (excluding
monetization (to the extent permitted under Section
8.10) of Derivative Contracts for the following twelve (12) months),
cumulative effect of accounting changes, income taxes, and cash distributions
actually received from Unrestricted Entities and from BEP I and from any entity
other than a Restricted Subsidiary; (b) minus,
without duplication, the following gains or credits to the extent added in the
determination of Consolidated Net Income in such period: unrealized gain on
Derivative Contracts, gain on sale of assets (excluding monetization (to the
extent permitted under Section
8.10) of Derivative Contracts for the following twelve (12) months),
cumulative effect of accounting changes, income from Unrestricted Entities,
income from BEP I, income from any other entity other than a Restricted
Subsidiary and other non-cash income.

      

      

        
          

        

      

      
        Second Amended and Restated Credit
Agreement – BreitBurn Operating L.P.

      

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      All
calculations of EBITDAX, for any applicable period during which a permitted
acquisition or Disposition is consummated shall be determined on a pro forma
basis (such calculation to be acceptable to, and approved by, Administrative
Agent) as if such acquisition or Disposition was consummated on the first day of
such applicable period.

       

      “Effective
Amount” means on any date, the
aggregate outstanding principal amount of all Loans after giving effect to any
prepayments or repayments of Loans occurring on such date plus the LC
Obligation.

       

      “Effective
Date” means the date on which all conditions precedent set forth in Sections 5.01 and
5.02 are satisfied or waived in accordance with Section 11.01.

       

      “Eligible
Assignee” means (a) a Lender, (b) an Affiliate of a Lender, (c) an
Approved Fund, and (d) any other Person (other than a natural person) approved
by (i) the Administrative Agent, (ii) in the case of any assignment of a
Commitment, the Issuing Lender and the Swing Line Lender, and (iii) unless an
Event of Default has occurred and is continuing, the Company (each such approval
not to be unreasonably withheld or delayed); provided that notwithstanding the
foregoing, “Eligible Assignee” shall not include the Company or any of the
Company’s Affiliates or Subsidiaries.

       

      “Engagement
Letter” has the meaning specified in Section
2.07(c) hereof.

       

      “Environmental
Claims” means all material claims by any Governmental Authority or other
Person alleging potential liability or responsibility for violation of any
Environmental Law, or for release or injury to the environment.

       

      “Environmental
Laws” means all material federal, state or local laws, statutes, common
law duties, rules, regulations, ordinances and codes, together with all material
administrative orders, requests, licenses, authorizations and permits of, and
agreements with, any Governmental Authorities, in each case having the force and
effect of law and relating to environmental, 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 the Company, any other Loan Party or any of their respective
Subsidiaries directly or indirectly resulting from or based upon (a) violation
of any Environmental Law, (b) the generation, use, handling, transportation,
storage, treatment or disposal of any Hazardous Materials, (c) exposure to any
Hazardous Materials, (d) the Release or threatened Release of any Hazardous
Materials into the environment or (e) any contract, agreement or other
consensual arrangement pursuant to which liability is assumed or imposed with
respect to any of the foregoing.

       

      “Equity”
means all shares, options, warrants, general or limited partnership interests,
participations or other equivalents (regardless of how designated) of or in a
corporation, limited liability company, partnership or equivalent entity whether
voting or nonvoting, including, without limitation, common stock, preferred
stock, or any other “equity
security” (as such term is defined in Rule 3a11-1 of the General Rules
and Regulations promulgated by the Securities and Exchange Commission under the
Securities Exchange Act of 1934, as amended).

    

    
      

      

        
          

        

      

      
        Second Amended and Restated Credit
Agreement – BreitBurn Operating L.P.

      

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      “ERISA”
means the Employee Retirement Income Security Act of 1974, as amended, and
regulations promulgated thereunder.

       

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

       

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

       

      “Event of
Default” means any of the events or circumstances specified in Section
9.01.

       

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

       

      “Excluded
Taxes” means, with respect to the Administrative Agent, any Lender, the
Issuing Lender or any other recipient of any payment to be made by or on account
of any Obligation of the Company, (a) Taxes imposed on or measured by its net
income (however denominated), and franchise Taxes imposed on it (in lieu of net
income Taxes), by the jurisdiction (or any political subdivision thereof) under
the laws of which such recipient is organized or in which its principal office
is located or, in the case of any Lender, in which its applicable Lending Office
is located, (b) any branch profits Taxes imposed by the United States of America
or any similar Tax imposed by any other jurisdiction and (c) in the case of a
Foreign Lender, any withholding Tax that is imposed on amounts payable to such
Foreign Lender at the time such Foreign Lender becomes a party hereto (for the
avoidance of doubt, whether as an original party hereto or as an Assignee) (or
designates a new Lending Office), (d) withholding taxes attributable to a
failure or inability (other than as a result of a Change in Law) of a Lender or
the Issuing Lender to comply with Section
3.01(e), except to the extent that such Lender or Issuing 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 Company with
respect to such withholding Tax pursuant to Section
3.01(a), (e) any U.S. Federal withholding Taxes imposed on amounts
payable to a Lender or Issuing Lender as a result of such Lender’s or Issuing
Lender’s failure to comply with FATCA, and (f) interest and penalties with
respect to taxes referred to in clauses
(a)
through (e) of
this definition.

       

      “Existing Credit
Agreement” has the meaning specified in the recitals hereto.

       

      “Existing Letters
of Credit” means the Letters of Credit outstanding on the Effective Date
that were issued pursuant to the Existing Credit Agreement.

       

      “FATCA”
means Sections 1471 through 1474 of the Code and any regulations or
official interpretations thereof.

      
        

        

          
            

          

        

        
          Second Amended and Restated Credit
Agreement – BreitBurn Operating L.P.

        

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      “FAS 133”
means Statement No. 133 of the Financial Accounting Standards
Board.

       

      “Federal Funds
Rate” means, for any day, the rate set forth in the weekly statistical
release designated as H.15(519), or any successor publication, published by the
Federal Reserve Bank of New York (including any such successor, “H.15(519)”) on the preceding
Business Day opposite the caption “Federal Funds (Effective)”;
or, if for any relevant day such rate is not so published on any such preceding
Business Day, the rate for such day will be the arithmetic mean as determined by
the Administrative Agent of the rates for the last transaction in overnight
Federal funds arranged prior to 9:00 a.m. (New York, New York time) on that day
by each of three leading brokers of Federal funds transactions in New York, New
York selected by the Administrative Agent.

       

      “Florida Crude Oil
Purchase Contracts” means collectively (a) the Crude Oil Purchase
Contract – Contract Number 6340-1004 dated May 8, 2006, by and between Calumet
Florida Division of Plains Resources and Plains Marketing, L.P., amended by the
First Amendment dated January 18, 2007, and the Amended and Restated Crude Oil
Purchase Contract dated May 16, 2007 as assigned to the Company or a Wholly
Owned Subsidiary pursuant to a Deed and General Conveyance between Calumet
Florida, L.L.C. (or a wholly owned subsidiary of Calumet) (“Calumet”)
and the Company or a Wholly Owned Subsidiary dated May 18, 2007, and (b) the
Crude Oil Purchase Contract - Contract Number 6340-1003 dated February 24, 2006,
by and between Calumet Florida Division of Plains Resources and Plains
Marketing, L.P., as amended by the First Amendment dated May 4, 2006, the Second
Amendment dated May 15, 2006, the Third Amendment dated and the Fourth Amendment
dated May 15, 2007, as assigned to the Company or a Wholly Owned Subsidiary
pursuant to Deed and General Conveyance between Calumet and the Company or a
Wholly Owned Subsidiary dated May 18, 2007, provided “Florida Crude Oil
Contracts” shall not include any further amendments, extensions or
modifications of such agreements.

       

      “Foreign”
means organized under the laws of a jurisdiction other than the United
States or a political subdivision thereof.

       

      “Foreign
Lender” means any Lender that is organized under the laws of a
jurisdiction other than that in which the Company is resident for Tax
purposes.  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.

       

      “FRB” means
the Board of Governors of the Federal Reserve System, and any Governmental
Authority succeeding to any of its principal functions.

       

      “Fronting
Exposure” means, at any time there is a Defaulting Lender, (a) with
respect to the Issuing Lender, such Defaulting Lender’s pro rata share of the
outstanding LC Obligation other than that portion of the LC Obligation as to
which such Defaulting Lender’s participation obligation has been reallocated to
other Lenders pursuant to Section 2.15
or cash collateralized in accordance with the terms hereof, and (b) with
respect to the Swing Line Lender, such Defaulting Lender’s pro rata share of
Swing Line Loans other than Swing Line Loans as to which such Defaulting
Lender’s participation obligation has been reallocated to other Lenders pursuant
to Section
2.15 or cash collateralized in accordance with the terms
hereof.

       

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

      
        

        

          
            

          

        

        
          Second Amended and Restated Credit
Agreement – BreitBurn Operating L.P.

        

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      “GAAP”
means generally accepted accounting principles set forth from time to time in
the opinions and pronouncements of the Accounting Principles Board and the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board (or agencies with
similar functions of comparable stature and authority within the U.S. accounting
profession), which are applicable to the circumstances as of the date of
determination.

       

      “General
Partner” means BreitBurn Operating GP, LLC, a Delaware limited liability
company.

       

      “Governmental
Authority” means any nation or government, any state or other political
subdivision thereof, any central bank (or similar monetary or regulatory
authority) thereof, any entity exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government, and any
corporation or other entity owned or controlled, through stock or capital
ownership or otherwise, by any of the foregoing.

       

      “Guaranties”
means, collectively, (a) each Continuing Guaranty Agreement, substantially in
the form of Exhibit G
hereto, as applicable, executed by the Guarantor or Guarantors in favor
of Administrative Agent, as same may be amended, supplemented or otherwise
modified from time to time, and (b) the Guaranties delivered in connection with
the Existing Credit Agreement (as such Guaranties have been amended pursuant to
the Master Reaffirmation and Amendment to Guaranties and Security Agreements).
“Guaranty”
means, individually, any one of the Guaranties.

       

      “Guarantors”
means, collectively, Parent and each Subsidiary of Parent that executes, or has
previously executed, a Guaranty pursuant to Section 7.15
hereof or the Existing Credit Agreement.  “Guarantor”
means, individually, any one of the Guarantors.

       

      “Guaranty
Obligation” has the meaning specified in the definition of “Contingent
Obligation.”

       

      “Hazardous
Materials” means any substance regulated or as to which liability might
arise under any applicable Environmental Law, including as a “hazardous
substance,” “hazardous material,” “hazardous waste,” “solid waste,” “toxic
waste,” “extremely hazardous substance,” “toxic substance,” “contaminant,”
“pollutant,” or words of similar meaning or import, and including: (a) petroleum
hydrocarbons, petroleum products, petroleum substances, natural gas, oil, oil
and gas waste, crude oil, and any components, fractions, or derivatives thereof;
and (b) radioactive materials, asbestos containing materials in a friable
condition or polychlorinated biphenyls.

       

      “Highest Lawful
Rate” means, as of a particular date, with respect to any Loan, the
maximum nonusurious interest rate that under applicable federal and New York law
may then be contracted for, charged or received by the Lenders in connection
with the Obligations.

       

      “Hydrocarbon
Interests” means leasehold and other interests in or under oil, gas and
other liquid or gaseous hydrocarbon leases wherever located, mineral fee
interests, overriding royalty and royalty interests, net profit interests,
production payment interests relating to oil, gas or other liquid or gaseous
hydrocarbons wherever located including any reserved or residual interest of
whatever nature.

      
        

        

          
            

          

        

        
          Second Amended and Restated Credit
Agreement – BreitBurn Operating L.P.

        

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      “Indebtedness”
of any Person means, without duplication, (a) all indebtedness for borrowed
money; (b) all obligations issued, undertaken or assumed as the deferred
purchase price of property or services (other than trade payables entered into
in the ordinary course of business on ordinary terms); (c) all undrawn
amounts under letters of credit; (d) all non-contingent reimbursement or
payment obligations with respect to Surety Instruments; (e) all obligations
evidenced by notes, bonds, debentures or similar instruments, including
obligations so evidenced incurred in connection with the acquisition of
property, assets or businesses; (f) all indebtedness created or arising under
any conditional sale or other title retention agreement, or incurred as
financing, in either case with respect to property acquired by the Person (even
though the rights and remedies of the seller or Lender under such agreement in
the event of default are limited to repossession or sale of such property)
including production payments, net profit interests and other Hydrocarbon
Interests subject to repayment out of future Oil and Gas production; (g) Capital
Leases; (h) all net obligations with respect to Derivative Contracts; (i) all
indebtedness referred to in clauses (a) through (g) above secured by (or for
which the holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien upon or in property (including accounts
and contracts rights) owned by such Person, even though such Person has not
assumed or become liable for the payment of such Indebtedness; and (j) all
Guaranty Obligations in respect of indebtedness or obligations of others of the
kinds referred to in clauses (a) through (h) above. The Indebtedness of any
Person shall include the Indebtedness of any partnership or joint venture (other
than a joint venture that is itself a corporation or limited liability company)
in which such Person is a general partner or a joint venturer, unless such
Indebtedness is expressly made non-recourse to such Person.

       

      “Indemnified
Taxes” means Taxes other than Excluded Taxes.

       

      “Indemnitee”
has the meaning specified in Section
11.04.

       

      “Independent
Auditor” has the meaning specified in Section
7.01(a).

       

      “Independent
Engineer” has the meaning specified in Section
6.11.

       

      “Initial Reserve
Report” has the meaning specified in Section
6.11.

       

      “Insolvency
Proceeding” means (a) any case, action or proceeding relating to
bankruptcy, reorganization, insolvency, liquidation, receivership, dissolution,
winding-up or relief of debtors, or (b) any general assignment for the benefit
of creditors, composition, marshaling of assets for creditors, or other, similar
arrangement in respect of its creditors generally or any substantial portion of
its creditors; undertaken under U.S. federal, state or foreign law, including
the Bankruptcy Code.

       

      “Interest Payment
Date” (a) as to any Base Rate Loan (including a Swing Line Loan), means
the last Business Day of each fiscal quarter prior to the Termination Date and
the Termination Date, and (b) as to any LIBOR Loan, the last day of each
Interest Period applicable to such Loan, provided, however, that if any
Interest Period for a LIBOR Loan exceeds three months, the date that falls three
months after the beginning of such Interest Period, and the date that falls
three months after each Interest Payment Date thereafter for such Interest
Period, is also an Interest Payment Date.

       

      “Interest
Period” means, as to any LIBOR Loan, the period commencing on the
Borrowing Date of such Revolving Credit Loan or on the Conversion/Continuation
Date on which the Revolving Credit Loan is converted into or continued as LIBOR
Loan, and ending on the date one, two, three or six months thereafter as
selected by the Company in its Notice of Revolving Credit Borrowing or Notice of
Conversion/Continuation; provided
that:  (a) if any Interest Period would otherwise end on a day
that is not a Business Day, that Interest Period shall be extended to the
following Business Day unless the result of such extension would be to carry
such Interest Period into another calendar month, in which event such Interest
Period shall end on the preceding Business Day; (b) any Interest Period that
begins on the last Business Day of a calendar month (or on a day for which there
is no numerically corresponding day in the calendar month at the end of such
Interest Period) shall end on the last Business Day of the calendar month at the
end of such Interest Period; and (c) no Interest Period shall extend beyond the
Termination Date.

      
        

        

          
            

          

        

        
          Second Amended and Restated Credit
Agreement – BreitBurn Operating L.P.

        

         Page
12

      

       

        
          
             

          

          
             

            
              

            

          

          
             

          

        

      

       

      “Interest Rate
Type” means, with respect to any Revolving Credit Loan, the interest
rate, being either the Base Rate or the LIBOR forming the basis upon which
interest is charged against such Revolving Credit Loan hereunder.

       

      “Investments”
has the meaning set forth in Section
8.04.

       

      “IRS” means
the Internal Revenue Service, and any Governmental Authority succeeding to any
of its principal functions under the Code.

       

      “Issue”
means with respect to any Letter of Credit, to issue or extend the expiry of, or
to renew or increase the amount of, such Letter of Credit; and the terms “Issued,”
“Issuing”
and “Issuance”
have corresponding meanings.

       

      “Issuing
Lender” has the meaning specified in the introductory clause
hereto.

       

      “LC
Application” means an application or agreement for a standby Letter of
Credit in such form as shall be acceptable to the Issuing Lender in its sole
discretion, and duly executed by the Company pursuant to Section
2.10(b).

       

      “LC Collateral
Account” means a blocked deposit account held by the Administrative
Agent.

       

      “LC
Obligation” means, at the time in question, the sum of the Matured LC
Obligations plus the aggregate
amount available to be drawn under all Letters of Credit then
outstanding.

       

      “LC Related
Document” means the Letters of Credit, LC Applications and any other
document relating to any Letter of Credit including any of the Issuing Lender’s
standard form documents for Letter of Credit issuances.

       

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

       

      “Lender Derivative
Contracts” means all Derivative Contracts  (including those
listed on Schedule
6.21) made or entered into, whether directly or indirectly, and whether
as a result of assignment or transfer or otherwise, between any Loan Party or
any Subsidiary and any Lender hereunder or Affiliate of a Lender hereunder, but
only if made or entered into while the Lender is a Lender hereunder (or under
the Existing Credit Agreement) or an Affiliate of a Lender hereunder (or under
the Existing Credit Agreement).

       

      “Lender Derivative
Provider” means any Person that is a party to a Lender Derivative
Contract with any Loan Party or any Subsidiary, provided that such Person is or
was a Lender hereunder (or under the Existing Credit Agreement) or an Affiliate
of a Lender hereunder (or under the Existing Credit Agreement) at  the
time it entered into such Derivative Contract.

       

      “Lending
Office” means, as to any Lender, the office or offices of such Lender
specified as its “Lending
Office” or “Domestic
Lending Office” or “Offshore Lending Office”, as
the case may be, on Schedule
11.02, or such other office or offices as such Lender may from time to
time notify the Company and the Administrative Agent.

       

      “Letter of
Credit” means any stand-by letter of credit issued by the Issuing Lender
pursuant to this Agreement and upon an LC Application, and shall include the
Existing Letters of Credit.

      
        

        

          
            

          

        

        
          Second Amended and Restated Credit
Agreement – BreitBurn Operating L.P.

        

         Page
13

         

        
          
            
               

            

            
               

              
                

              

            

            
               

            

          

        

      

       

      “Letter of Credit
Fee” means the fee specified in Section
2.07(b).

       

      “Letter of Credit
Sublimit” means the lesser of (x) $50,000,000 and (y) the Available
Borrowing Base.

       

      “LIBOR”
means a per annum rate of interest (rounded upwards, if necessary, to the
nearest 1/100th%) equal
to the rate determined by the Administrative Agent at approximately 11:00 a.m.,
London time, on the date that is two Business Days prior to the commencement of
such Interest Period by reference to the British Bankers’ Association Interest
Settlement Rates for deposits in dollars (as set forth by the Bloomberg
Information Service or any successor thereto or any other service selected by
the Administrative Agent which has been nominated by the British Bankers’
Association as an authorized information vendor for the purpose of displaying
such rates) for a period equal to such Interest Period; provided that, to the
extent that an interest rate is not ascertainable pursuant to the foregoing
provisions of this definition, “LIBOR” shall be the interest rate per annum
determined by the Administrative Agent to be the average of the rates per annum
at which deposits in dollars are offered for such relevant Interest Period to
major banks in the London interbank market in London, England by the
Administrative Agent at approximately 11:00 a.m. (London time) on the date that
is two (2) Business Days prior to the beginning of such Interest
Period.  The determination and calculation of the LIBOR and each
component thereof by Administrative Agent shall be conclusive and binding,
absent manifest error.

       

      “LIBOR
Loan” means a Loan that bears interest based on LIBOR plus the Applicable
Margin.

       

      “Lien”
means any security interest, mortgage, deed of trust, pledge, hypothecation,
assignment, charge or deposit arrangement, encumbrance, lien (statutory or
other) or preferential arrangement of any kind or nature whatsoever in respect
of any property (including those created by, arising under or evidenced by any
conditional sale or other title retention agreement and the interest of a lessor
under a Capital Lease), any financing lease having substantially the same
economic effect as any of the foregoing, or the filing of any financing
statement naming the owner of the asset to which such lien relates as debtor,
under the Uniform Commercial Code or any comparable law and any contingent or
other agreement to provide any of the foregoing, but not including (a) the
interest of a lessor under a lease on Oil and Gas Properties and (b) the
interest of a lessor under an Operating Lease.

       

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

       

      “Loan
Documents” means this Agreement,
the Notes, each Guaranty, the Security Documents, each LC Application and Letter
of Credit, the Engagement Letter and each other document executed by a Loan
Party in connection herewith that by its terms states that it is a Loan
Document.

       

      “Loan
Parties” means
collectively the Company, the General Partner and each of the Guarantors. “Loan Party”
means individually, any of the Company or a Guarantor.

       

      “Majority
Lenders” means, at any time, the Lenders holding at least fifty percent
(50%) of the sum of the Effective Amount or, if there is no Effective Amount,
the Lenders holding at least fifty percent (50%) of the sum of the Commitments
of all of the Lenders, provided that, the
Commitment of, and the portion of the Effective Amount held or deemed held by,
any Defaulting Lender shall be excluded for purposes of making a determination
of Majority Lenders unless all Lenders are Defaulting Lenders.

       

      “Margin
Stock” means “margin
stock” as such term is defined in Regulation U or X of the
FRB.

      
        

        

          
            

          

        

        
          Second Amended and Restated Credit
Agreement – BreitBurn Operating L.P.

        

         Page
14

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      “Master
Reaffirmation and Amendment to Guaranties and Security Agreements” means
the Master Reaffirmation and Amendment to Guaranties and Security Agreements
executed by each Person party to a Security Agreement or Guaranty in connection
with the Existing Credit Agreement, in favor of the Administrative Agent for the
benefit of the Lenders and the Lender Derivative Providers.

       

      “Material Adverse
Effect” means (a) a material adverse change in, or a material adverse
effect upon, the operations, business, properties or financial condition of the
Loan Parties taken as a whole, or as to the Company, including without
limitation, any material adverse change in reserve estimates of the Oil and Gas
Properties of the Loan Parties taken as a whole; (b) a material impairment of
the ability of any Loan Party to perform its material obligations under the Loan
Documents; or (c) a material adverse effect upon the legality, validity, binding
effect or enforceability against any Loan Party of any material Loan
Document.

       

      “Matured LC
Obligation” means, at any time, the aggregate amount of payments
theretofore made by the Issuing Lender in respect to Letters of Credit and not
theretofore reimbursed by or on behalf of the Company to the Issuing
Lender.

       

      “Mortgaged
Properties” means such Oil and Gas Properties upon which the Loan Parties
have granted the Administrative Agent for the benefit of the Lenders a Lien
pursuant to the Mortgages.

       

      “Mortgages”
means the mortgages from the Loan Parties, as applicable, in favor of
Administrative Agent, for the benefit of the Lenders described on Schedule
4.01 hereto, and all supplements, assignments, amendments and
restatements thereto (or any agreement in substitution therefor) as the same may
be released in whole or in part from time to time which are executed and
delivered to Administrative Agent for benefit of the Lenders pursuant to Article IV
of this Agreement.

       

      “Multiemployer
Plan” means a “multiemployer plan”, within
the meaning of Section 4001(a)(3) of ERISA, to which a Loan Party or any ERISA
Affiliate makes, is making, or is obligated to make contributions or, during the
preceding three calendar years, has made, or been obligated to make,
contributions.

       

      “Notes”
means the promissory notes, whether one or more, specified in Section
2.01, substantially in the same form as Exhibit E
including any amendments, modifications, renewals or replacements of such
promissory notes.

       

      “Notice of
Conversion/Continuation” means a notice in substantially the form of
Exhibit
B.

       

      “Notice of
Revolving
Credit
Borrowing” means a notice in substantially the form of Exhibit
A-1.

       

      “Obligations”
means all advances, debts, liabilities, obligations, covenants and duties owing
or to be owing, whether direct or indirect (including those acquired by
assignment), absolute or contingent, due or to become due, now existing or
hereafter arising or incurred, by the Company or any other Loan
Party:  (a) to any Lender, the Issuing Lender, the Administrative
Agent, or any Indemnitee under any Loan Document; (b) to any Lender Derivative
Provider under any Lender Derivative Contract; and (c) all renewals, extensions
and rearrangements of the foregoing; in each case including interest accruing
subsequent to the filing of a petition or other proceeding under the Bankruptcy
Code or other similar proceeding.

      
        

        

          
            

          

        

        
          Second Amended and Restated Credit
Agreement – BreitBurn Operating L.P.

        

         Page
15

      

       

        
          
             

          

          
             

            
              

            

          

          
             

          

        

      

       

      “Oil and
Gas” means petroleum, natural gas and other related hydrocarbons or
minerals or any of them and all other substances produced or extracted in
association therewith.

       

      “Oil and Gas
Liens” means Liens reserved under oil and gas leases, overriding royalty
agreements, net profits agreements, royalty trust agreements, farm-out
agreements, division orders, contracts for the sale, purchase, exchange,
transportation, gathering or processing of oil, gas or other hydrocarbons,
unitizations and pooling designations, declarations, orders and agreements,
development agreements, Operating Agreements, production sales contracts, area
of mutual interest agreements, gas balancing or deferred production agreements,
injection, repressuring and recycling agreements, salt water or other disposal
agreements, seismic or geophysical permits or agreements, and other agreements
that are customary in the oil and gas business and are entered into by any Loan
Party in the ordinary course of business, provided in all
instances that such Liens are limited to the assets that are the subject of the
relevant agreement.

       

      “Oil and Gas
Properties” means Hydrocarbon Interests now owned by the Loan Parties or
any Subsidiary thereof and contracts executed in connection therewith and all
tenements, hereditaments, appurtenances, and properties belonging, affixed or
incidental to such Hydrocarbon Interests, including, without limitation, any and
all property, real or personal, now owned by the Loan Parties and situated upon
or to be situated upon, and used, built for use, or useful in connection with
the operating, working or developing of such Hydrocarbon Interests, including,
without limitation, any and all petroleum and/or natural gas wells, buildings,
structures, field separators, liquid extractors, plant compressors, pumps,
pumping units, field gathering systems, tank and tank batteries, fixtures,
valves, fittings, machinery and parts, engines, boilers, liters, apparatus,
equipment, appliances, tools, implements, cables, wires, towers, taping, tubing
and rods, surface leases, rights-of-way, easements and servitudes, and all
additions, substitutions, replacements for, fixtures and attachments to any and
all of the foregoing owned directly or indirectly by the Loan Parties or any
Subsidiary thereof.

       

      “Operating
Agreements” mean those agreements now or hereafter executed by any Loan
Party and other working interest owners of the Oil and Gas Properties in
connection with the operation of the Oil and Gas Properties.

       

      “Operating
Lease” means an operating lease determined in accordance with
GAAP.

       

      “Organization
Documents” means (a) for any corporation: the articles of incorporation,
the bylaws, any certificate of determination or instrument relating to the
rights of the shareholders of such corporation, any shareholder rights
agreement, and all applicable resolutions of the board of directors (or any
committee thereof) of such corporation; (b) for any limited liability company:
the articles of organization, the regulations or operating agreement,
certificate of organization and all applicable resolutions of the members of
such company; and (c) for any limited partnership: the limited partnership
agreement and all Organization Documents for its general partner, as any of the
foregoing have been amended or supplemented from time to time.

       

      “Other
Taxes” means any present or future stamp or documentary taxes or any
other excise or property taxes, charges or similar levies which arise from any
payment made hereunder or from the execution, delivery or registration of, or
otherwise with respect to, this Agreement or any other Loan
Documents.

       

      “Parent” has the meaning specified in
the introductory clause hereto.

       

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

      
        

        

          
            

          

        

        
          Second Amended and Restated Credit
Agreement – BreitBurn Operating L.P.

        

         Page
16

      

       

        
          
             

          

          
             

            
              

            

          

          
             

          

        

      

       

      “PBGC”
means the Pension Benefit Guaranty Corporation, or any Governmental Authority
succeeding to any of its principal functions under ERISA.

       

      “Pension
Plan” means a pension plan (as defined in Section 3(2) of ERISA) subject
to Title IV of ERISA, other than a Multiemployer Plan, which a Loan Party or any
of its Subsidiaries sponsors, maintains, or to which it makes, is making, or is
obligated to make contributions, or in the case of a multiple employer plan (as
described in Section 4064(a) of ERISA) has made contributions at any time during
the immediately preceding five (5) plan years.

       

      “Permitted
Liens” has the meaning specified in Section
8.01.

       

      “Person”
means an individual, partnership, corporation, limited liability company,
business trust, joint stock company, trust, unincorporated association, joint
venture or Governmental Authority.

       

      “Phase I
Report” means a report detailing the findings of an environmental site
assessment conducted by a qualified third party that satisfies the standards set
forth in the current American Standards and Testing Materials designated
protocol for Phase I Environmental Site Assessments, E1527-05, or any subsequent
edition thereof.

       

      “Plan”
means an employee benefit plan (as defined in Section 3(3) of ERISA) which is
subject to ERISA, other than a Multiemployer Plan, which any Loan Party
sponsors, maintains, or to which it makes, is making, or is obligated to make
contributions, or in the case of a multiple employer plan (as described in
Section 4064(a) of ERISA) has made contributions at any time during the
immediately preceding five (5) plan years.

       

      “Pricing
Grid” means the annualized variable rates (stated in terms of basis
points (“bps”)) set
forth below for the Applicable Margin, Commitment Fee and Letter of Credit Fee,
based upon the ratio of Effective Amount to the Borrowing Base Amount, as
follows:

       

      
        
          
            
              
                
                  
                    
                      	 
      	
                              Applicable Margin

                            	 
      	 
      
	
                              Effective Amount/

                              Borrowing Base

                            	
                              LIBOR

                              Rate

                              (bps)

                            	
                              Base Rate

                              (bps)

                            	
                              Commitment

                              Fee

                              (bps)

                            	
                              Letter of Credit

                              Fee

                              (bps)

                            
	
                              3 90%

                            	
                              300.00

                            	
                              200.00

                            	
                              50.00

                            	
                              300.00

                            
	
                              < 90% 3 75%

                            	
                              275.00

                            	
                              175.00

                            	
                              50.00

                            	
                              275.00

                            
	
                              < 75% 3 50%

                            	
                              250.00

                            	
                              150.00

                            	
                              50.00

                            	
                              250.00

                            
	
                              < 50% 3 25%

                            	
                              225.00

                            	
                              125.00

                            	
                              50.00

                            	
                              225.00

                            
	
                              <
    25%

                            	
                              200.00

                            	
                              100.00

                            	
                              50.00

                            	
                              200.00

                            

                    

                  

                

              

            

          

        

      

       

      The
Pricing Grid for any date shall be determined by reference to the ratio of the
Effective Amount and Borrowing Base and any change (a) shall become effective
upon the delivery to the Administrative Agent of a Pricing Grid Certificate of a
Responsible Officer of the Company (which certificate shall be delivered
simultaneously with (i) the delivery of each Notice of Borrowing, any
notice required under Section
2.04, Notice of Conversion/Continuation or a request for issuance of a
Letter of Credit and (ii) any change in the amount of the Borrowing Base), and
(b) shall apply (i) in the case of the Base Rate Loans, to Base Rate Loans
outstanding on such delivery date or made on and after such delivery date and
(ii) in the case of the LIBOR Loans, to LIBOR Loans made, continued or converted
on and after such delivery date. Notwithstanding the foregoing, at any time
during which the Company has failed to deliver the Pricing Grid Certificate when
due, the ratio of Effective Amount to the Borrowing Base shall be deemed, solely
for the purposes of this definition, to be greater than 90% until such time as
the Company shall deliver such certificate.

      
        

        

          
            

          

        

        
          Second Amended and Restated Credit
Agreement – BreitBurn Operating L.P.

        

         Page
17

      

       

        
          
             

          

          
             

            
              

            

          

          
             

          

        

      

       

      “Pricing Grid
Certificate” means a Pricing Grid Certificate substantially in the form
of Exhibit
F hereto.

       

      “Principal
Business” means the business of (a) the exploration for, and development,
acquisition, production, processing and upstream marketing and transportation of
Oil and Gas; and (b) the business of providing services in connection with the
production of Oil and Gas.

       

      “Property”
means any interest in any kind of property or asset, whether real, personal or
mixed, tangible or intangible.

       

      “Pro Rata
Share” means, as to any Lender at any time, the percentage set forth
opposite its name on Schedule
2.01 hereto, as modified by any Assignment and Assumption, subject to
adjustment as provided in Section
2.15.

       

      “Quarterly Status
Report” for a fiscal quarter means a status report prepared quarterly by
the Company in form, scope and content acceptable to the Administrative Agent,
setting forth as of the last day of each month during such quarter (a) detailing
production from the Oil and Gas Properties, the volumes of Oil and Gas produced
and saved, the volumes of Oil and Gas sold, gross revenue, net income, related
leasehold operating expenses, severance taxes, other taxes, capital costs and
any production imbalances incurred during such period, (b) information
concerning any Derivative Contracts entered into by the Company or its
Subsidiaries, and (c) such additional information with respect to any of the Oil
and Gas Properties as may be reasonably requested by Administrative
Agent.

       

      “Regulation
U” and “Regulation
X” means Regulation U and Regulation X, respectively, of the FRB from
time to time in effect and shall include any successor or other regulations or
official interpretations of the FRB relating to the subject matter addressed
therein.

       

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

       

      “Release”
means any spilling, leaking, pumping, pouring, emitting, emptying, discharging,
injecting, escaping, leaching, dumping, or disposing.

       

      “Remedial
Work” has the meaning assigned to such term in Section
7.13.

       

      “Reportable
Event” means, any of the events set forth in Section 4043(b) of ERISA or
the regulations thereunder, other than any such event for which the 30-day
notice requirement under ERISA has been waived in regulations issued by the
PBGC.

       

      “Required
Lenders” means, at any time, Lenders holding at least sixty-six and
two-thirds percent (662⁄3%) of the sum of the Effective Amount or, if there is no
Effective Amount,  Lenders holding at least sixty-six and two-thirds
percent (662⁄3%) of the sum of the Commitments of all of the Lenders, provided that, the
Commitment of, and the portion of the Effective Amount held or deemed held by,
any Defaulting Lender shall be excluded for purposes of making a determination
of Required Lenders unless all Lenders are Defaulting Lenders.

      
        

        

          
            

          

        

        
          Second Amended and Restated Credit
Agreement – BreitBurn Operating L.P.

        

         Page
18

      

       

        
          
             

          

          
             

            
              

            

          

          
             

          

        

      

       

      “Requirement of
Law” means, as to any Person, any law (statutory or common), treaty, rule
or regulation or determination of a Governmental Authority, in each case
applicable to or binding upon the Person or any of its property or to which the
Person or any of its property is subject.

       

      “Reserve
Report” means a report, in form, scope and content acceptable to the
Administrative Agent, covering proved developed and proved undeveloped Oil and
Gas reserves attributable to the Oil and Gas Properties owned by the Company and
its Subsidiaries and setting forth with respect thereto, (a) the total quantity
of proved developed and proved undeveloped reserves (separately classified as to
producing, shut-in, behind pipe, and undeveloped), (b) the estimated future net
revenues and cumulative estimated future net revenues, (c) the present
discounted value of future net revenues, and (d) such other information and data
with respect to such Oil and Gas Properties as the Administrative Agent may
reasonably request.

       

      “Responsible
Officer” of a Person means any chief executive officer or co-chief
executive officer, president, vice president with responsibility for financial
matters, chief financial officer or treasurer of (1) such Person, if such
Person  is a corporation or limited liability company, or (2) the
general partner of such Person, if such Person is a partnership.

       

      “Restricted
Subsidiary” means all subsidiaries of the Parent (other than the Company)
and all subsidiaries of the Company, other than Unrestricted
Entities.

       

      “Revolving Credit
Borrowing” means a borrowing hereunder consisting of Revolving Credit
Loans of the same Interest Rate Type made to the Company on the same day by the
Lenders under Article
II, and, other than in the case of Base Rate Loans, having the same
Interest Period.

       

      “Revolving Credit
Loan” has the meaning specified in Section
2.01.

       

      “Scheduled
Borrowing Base Determination” means a redetermination of the Borrowing
Base in accordance with Section
2.05(b) on each Scheduled Borrowing Base Determination Date.

       

      “Scheduled
Borrowing Base Determination Date” means October 1, 2010 and
thereafter April 1 and October 1 of each calendar year.

       

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

       

      “Security
Agreements” means collectively, (a) each agreement in substantially the
form of Exhibit H
executed by a Loan Party in favor of Administrative Agent for the benefit of the
Lenders and the Lender Derivative Parties, and (b) each Security Agreement
delivered in connection with the Existing Credit Agreement (as such Security
Agreements have been amended pursuant to the Master Reaffirmation and Amendment
to Guaranties and Security Agreements).

       

      “Security
Documents” means the Mortgages, the Security Agreements and related
financing statements as same may be amended from time to time and any and all
other instruments now or hereafter executed in connection with or as security
for the payment of the Obligations.

      
        

        

          
            

          

        

        
          Second Amended and Restated Credit
Agreement – BreitBurn Operating L.P.

        

         Page
19

      

       

        
          
             

          

          
             

            
              

            

          

          
             

          

        

      

    

    
       

      “Senior Unsecured
Notes” means unsecured notes issued by the Company, BreitBurn Finance
Corporation, or the Parent after the Effective Date; provided that, the
agreements and instruments governing such Indebtedness shall not contain (a) any
affirmative or negative covenant (including financial covenants) that is more
restrictive than those set forth in this Agreement; provided that the inclusion
of any covenant that is customary with respect to such type of Indebtedness and
that is not found in this Agreement shall not be deemed to be more restrictive
for purposes of this clause (a), (b) any restriction on the ability of the
Company or any of its Restricted Subsidiaries to amend, modify, restate or
otherwise supplement this Agreement or the other Loan Documents, (c) any
restrictions on the ability of any Subsidiary of the Company or Parent to
guarantee the Obligations (as such Obligations may be amended, supplemented,
modified, or amended and restated), (d) any restrictions on the ability of any
Subsidiary, the Parent or the Company to pledge assets as collateral security
for the Obligations (as such Obligations may be amended, supplemented, modified,
or amended and restated), (e) a scheduled maturity date that is earlier than
first anniversary of the Maturity Date, (f) any amortization or other mandatory
principal payments by way of a sinking fund or similar arrangement other than at
the scheduled maturity thereof, or (g) any Lien securing such
Indebtedness.

       

      “Solvent”
means, as to any Person at any time, that (a) the fair value of all of the
property of such Person is greater than the amount of such Person’s liabilities
(including disputed, contingent and unliquidated liabilities) as such value is
established and liabilities evaluated for purposes of Section 101(32) of the
Bankruptcy Code; (b) the present fair salable value of all of the property of
such Person is not less than the amount that will be required to pay the
probable liability of such Person on its debts as they become absolute and
matured; (c) such Person does not intend to, and does not believe that it will,
incur debts or liabilities beyond such Person’s ability to pay as such debts and
liabilities mature; and (d) such Person is not engaged in business or a
transaction, and is not about to engage in business or a transaction, for which
such Person’s property would constitute unreasonably small capital.

       

      “Special Borrowing
Base Determination” has the meaning specified in Section
2.05(b).

       

      “subsidiary”
of a Person means any corporation, limited liability company, association,
partnership, joint venture or other business entity of which more than 50% of
the voting stock or other Equity (in the case of Persons other than
corporations) having ordinary voting power for the election of directors or
other governing body are owned, or the management of which is controlled
directly or indirectly by such Person, or by one or more of the subsidiaries of
such Person, or a combination thereof.  All references in this
Agreement and in the other Loan Documents to the capitalized terms “Subsidiary”
or “Subsidiaries”
shall mean Restricted Subsidiaries and shall not include any Unrestricted
Entity.

       

      “Surety
Instruments” means all letters of credit (including standby), banker’s
acceptances, bank guaranties, shipside bonds, surety bonds and similar
instruments.

       

      “Swing Line
Borrowing” means a borrowing of a Swing Line Loan pursuant to Section
2.13.

       

      “Swing Line
Lender” has the meaning specified in the introductory clause
hereto.

       

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

       

      “Swing Line Loan
Notice” means a notice of a Swing Line Borrowing pursuant to Section
2.13, which, if in writing, shall be substantially in the form of Exhibit
A-2.

       

      “Swing Line
Settlement Date” means the 15th day and
the last day of each calendar month, provided however, that if any such day is
not a Business Day, the applicable Swing Line Settlement Date shall be the
Business Day immediately preceding such day.

       

        
          

        

      

      
        
          	
                   
      

                	
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      Amended and Restated Credit Agreement – BreitBurn Operating
      L.P.

                

        

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      “Swing Line
Sublimit” means an amount equal to the lesser of (a) $25,000,000 and (b)
the Borrowing Base.

       

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

       

      “Termination
Date” means the earlier of (a) May 7, 2014, or (b) the date on which
the Lenders’ Commitments terminate in accordance with the provisions of this
Agreement.

       

       “Total
Indebtedness” means, at any date, all Indebtedness of the Parent and its
Consolidated Subsidiaries, on a consolidated basis, excluding, however, all net
obligations with respect to Derivative Contracts entered into in accordance with
Section
8.10 and any Guaranty Obligations thereof by Parent entered into in
accordance with Section
8.08(b).

       

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

       

      “United
States” and “U.S.” each
means the United States of America.

       

      “Unrestricted
Entity” means (1) the entities listed on Schedule 6.19
under the heading “Unrestricted
Entities”; and (2) in the event an entity that is not a Wholly Owned
Subsidiary becomes, after the Effective Date, a subsidiary of Parent, then such
entity shall be an Unrestricted Entity, provided, however, in the event
that (a) any of the foregoing entities becomes a Wholly Owned Subsidiary of
Parent, or (b) any of the foregoing entities guarantees, or grants any Lien to
secure, any other Indebtedness of Parent or any Restricted Subsidiary of Parent,
then such entity shall no longer be an Unrestricted Entity and shall be a
Restricted Subsidiary, and all of the covenants and other provisions of this
Agreement applicable to Restricted Subsidiaries shall apply to such
Subsidiary.  In addition, Parent or Company may, by notice given to
the Administrative Agent, designate an Unrestricted Entity as a Restricted
Subsidiary, provided that the requirements of this Agreement pertaining to the
granting of Collateral and the giving of a Guaranty by such Subsidiary
(including Sections
4.01,
4.02, 7.14 and
7.15)
shall be satisfied as a condition of such designation.

       

      “Wholly
Owned” means, when used to describe a Subsidiary, that all of the Equity
of such Subsidiary is owned, directly or indirectly, by Parent or the
Company.

       

      1.02        Other
Interpretive Provisions.  The
meanings of defined terms are equally applicable to the singular and plural
forms of the defined terms.  Unless otherwise specified or the context
clearly requires otherwise, the words “hereof,” “herein,” “hereunder” and similar words
refer to this Agreement as a whole and not to any particular provision of this
Agreement; and subsection, Section, Schedule and Exhibit references are to this
Agreement.  The term “documents” includes any and
all instruments, documents, agreements, certificates, indentures, notices and
other writings, however evidenced.  The term “including” is not limiting
and means “including without
limitation.”  In the computation of periods of time from a
specified date to a later specified date, the word “from” means “from and including,” the
words “to” and “until” each mean “to but excluding,” and the
word “through” means
“to and
including.”  Unless otherwise expressly provided herein, (a)
references to agreements (including this Agreement) and other contractual
instruments shall be deemed to include all subsequent amendments and other
modifications thereto, but only to the extent such amendments and other
modifications are not prohibited by the terms of any Loan Document, and (b)
references to any statute or regulation are to be construed as including all
statutory and regulatory provisions consolidating, amending, replacing,
supplementing or interpreting the statute or regulation.  The captions
and headings of this Agreement are for convenience of reference only and shall
not affect the interpretation of this Agreement.  This Agreement and
other Loan Documents may use several different limitations, tests or
measurements to regulate the same or similar matters.  All such
limitations, tests and measurements are cumulative and shall each be performed
in accordance with their terms.  This Agreement and the other Loan
Documents are the result of negotiations among and have been reviewed by counsel
to the Administrative Agent, the Company and the other parties, and are the
products of all parties.  Accordingly, they shall not be construed
against the Lenders or the Administrative Agent merely because of the
Administrative Agent’s or Lenders’ involvement in their
preparation.

      
         

        
          

        

        
          
            	
                     
      

                  	
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      Amended and Restated Credit Agreement – BreitBurn Operating
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      1.03        Accounting
Principles.  Unless
the context otherwise clearly requires, all accounting terms not expressly
defined herein shall be construed, and all financial computations required under
this Agreement shall be made, in accordance with GAAP, consistently applied as
in effect from time to time, applied in a manner consistent with that used in
preparing the audited financial statements for the fiscal year ended
December 31, 2009.  References to “consolidated,” when it
precedes any accounting term, means such term as it would apply to the Loan
Parties on a consolidated basis, determined in accordance with
GAAP.

       

      ARTICLE
II.

       

      THE
CREDIT

       

      2.01        Amounts and Terms of the
Commitments.

       

      (a)           Each
Lender severally agrees, on the terms and conditions set forth herein, to make
loans to the Company (each such loan, a “Revolving Credit
Loan”) from time to time on any Business Day during the period from the
Effective Date to the Termination Date, so long as (a) with respect to any
Lender, such Revolving Credit Loans then requested to be made by such Lender do
not exceed such Lender’s Pro Rata Share of the aggregate amount of all Loans
then requested from the Lenders, and (b) the sum of the aggregate principal
amount of all Revolving Credit Loans by all Lenders hereunder plus the aggregate
principal amount of all Swing Line Loans plus the LC Obligation outstanding at
any time does not exceed the Borrowing Base in effect at such
time.  Subject to the terms and conditions hereof, until the
Termination Date, Company may borrow, repay, and reborrow
hereunder.

       

      (b)           Upon
the request of any Lender made through the Administrative Agent, the Company
shall execute and deliver to such Lender (through the Administrative Agent) a
promissory note from the Company payable to the order of such Lender (herein
called such Lender’s “Note” and
collectively, the “Notes”).  The
amount of principal owing on any Lender’s Note at any given time shall be the
aggregate amount of all Loans theretofore made by such Lender minus all payments of
principal theretofore received by such Lender on such Note.  Interest
on each Note shall accrue and be due and payable as provided herein and
therein.

       

      (c)           Subject
to the terms and conditions of Section
2.10 below and relying upon the agreements of the Lenders set forth
herein, the Issuing Lender agrees to issue Letters of Credit as support for
Derivative Contracts covering Oil and Gas commodities and other purposes
approved by the Administrative Agent upon the request of the Company at any time
and from time to time on and after the Effective Date and up to, but excluding,
the Termination Date (the “Availability
Period”), and the Lenders severally agree to participate in such Letters
of Credit and drawings thereunder.  No Letter of Credit will be issued
in a face amount which, after giving effect to the issuance of such Letter of
Credit, would cause the LC Obligation to exceed $50,000,000 or the Effective
Amount to exceed the Borrowing Base then in effect.

       

      
        
          

        

        
          
            	
                     
      

                  	
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      Amended and Restated Credit Agreement – BreitBurn Operating
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      2.02        Procedure for
Borrowings.

       

      (a)           Each
Revolving Credit Borrowing of Revolving Credit Loans shall be made upon the
Company’s irrevocable written notice delivered to the Administrative Agent in
the form of a Notice of Revolving Credit Borrowing duly completed; which notice
must be received by the Administrative Agent (x) prior to 1:00 p.m. (Houston,
Texas time) three (3) Business Days prior to the requested Borrowing Date, in
the case of LIBOR Loans, (y) prior to 9 a.m. (Houston, Texas time) two (2)
Business Days prior to the requested Borrowing Date, in the case of LIBOR Loans
with an Interest Period of one month to be borrowed on the Effective Date, and
(z) prior to 1:00 p.m. (Houston, Texas time) one (1) Business Day prior to the
requested Borrowing Date, in the case of Base Rate Loans.

       

      (b)           Each
Notice of Revolving Credit Borrowing shall specify (i) the amount of the
Revolving Credit Borrowing, which shall be in an aggregate minimum amount (A)
for Base Rate Loans equal to the lesser of (y) $500,000 or any multiple
integrals of $100,000 in excess thereof or (z)
the unadvanced portion of the Available Borrowing Base, except that clause (y)
shall  not apply in the case of Loans to fund reimbursement
obligations under drawings under Letters of Credit, and (B) for LIBOR Loans
$3,000,000 or any multiple integrals of $1,000,000 in excess thereof (if the
Available Borrowing Base as of such Borrowing Date will be less than $3,000,000,
then the Company may not request a LIBOR Loan); (ii) the requested Borrowing
Date, which shall be a Business Day; (iii) the Interest Rate Type of Loans
comprising the Revolving Credit Borrowing; and (iv) for LIBOR Loans the duration
of the Interest Period applicable to such Revolving Credit Loans. If the Notice
of Revolving Credit Borrowing fails to specify the duration of the Interest
Period for any Revolving Credit Borrowing comprised of LIBOR Loans, such
Interest Period shall be one month.

       

      (c)           The
number of tranches outstanding of Base Rate Loans and LIBOR Loans, whether under
a Borrowing, conversion or continuation shall not exceed ten (10) at any one
time.

       

      (d)           The
Administrative Agent will promptly notify each Lender of its receipt of any
Notice of Revolving Credit Borrowing and of the amount of such Lender’s Pro Rata
Share of that Revolving Credit Borrowing.

       

      (e)           Provided
the applicable conditions in Article V
are met, each Lender will make the amount of its Pro Rata Share of each
Revolving Credit Borrowing available to the Administrative Agent for the account
of the Company at the Administrative Agent’s Payment Office by 11:00 a.m.
(Houston, Texas time) on the Borrowing Date requested by the Company in funds
immediately available to the Administrative Agent.  The proceeds of
all such Loans will then be made available to the Company by the Administrative
Agent to the Company’s operating account with the Administrative Agent or by
wire transfer in accordance with written instructions provided to the
Administrative Agent by the Company of like funds as received by the
Administrative Agent.

       

      2.03        Conversion and Continuation
Elections.

       

      (a)           During
the period from the Effective Date to the Termination Date, the Company may,
upon irrevocable written notice to the Administrative Agent in accordance with
Section
2.03(b):  (i) elect, as of any Business Day, in the case of
Base Rate Loans, or as of the last day of the applicable Interest Period, in the
case of LIBOR Loans, to convert any such Revolving Credit Loans into Revolving
Credit Loans of any other Interest Rate Type; or (ii) elect as of the last day
of the applicable Interest Period, to continue any Revolving Credit Loans having
Interest Periods expiring on such day; provided, that if at
any time a LIBOR Loan in respect of any Revolving Credit Borrowing is reduced,
by payment, prepayment, or conversion of part thereof to less than $3,000,000,
such LIBOR Loan shall automatically convert into a Base Rate Loan.

       

      
        
          

        

        
          
            	
                     
      

                  	
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      Amended and Restated Credit Agreement – BreitBurn Operating
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      (b)           The
Company shall deliver a Notice of Conversion/Continuation to be received by the
Administrative Agent not later than 1:00 p.m. (Houston, Texas time) at least (i)
three (3) Business Days in advance of the Conversion/Continuation Date, if the
Revolving Credit Loans are to be converted into or continued as LIBOR Loans; and
(ii) one (1) Business Day in advance of the Conversion/Continuation Date, if the
Revolving Credit Loans are to be converted into Base Rate Loans, specifying: (A)
the proposed Conversion/Continuation Date; (B) the aggregate amount of Revolving
Credit Loans to be converted or continued; (C) the Interest Rate Type of Loans
resulting from the proposed conversion or continuation; and (D) other than in
the case of conversions into Base Rate Loans, the duration of the requested
Interest Period.

       

      (c)           If
upon the expiration of any Interest Period applicable to LIBOR Loans, the
Company has failed to select timely a new Interest Period to be applicable to
LIBOR Loans, or if any Default or Event of Default then exists, the Company
shall be deemed to have elected to convert such LIBOR Loans into Base Rate Loans
effective as of the expiration date of such Interest Period.

       

      (d)           The
Administrative Agent will promptly notify each Lender of its receipt of a Notice
of Conversion/Continuation, or, if no timely notice is provided by the Company,
the Administrative Agent will promptly notify each Lender of the details of any
automatic conversion.  All conversions and continuations shall be made
ratably according to the respective Lender’s Pro Rata Share of outstanding
principal amounts of the Revolving Credit Loans with respect to which the notice
was given.

       

      2.04        Optional
Commitment Reductions and Optional Prepayments.

       

      (a)           The
Company shall have the right to terminate or to permanently reduce the amount of
the Aggregate Maximum Credit Amount, the Swing Line Sublimit or the Letter of
Credit Sublimit, at any time, or from time to time, upon notice given to the
Administrative Agent (which shall promptly notify the Lenders) not less than 12
Noon Houston, Texas time three (3) Business Days' prior to the date of
termination or reduction, which notice shall specify the effective date thereof
and the amount of any such reduction (which shall not be less than (i)
$5,000,000.00 or any whole multiple of $1,000,000.00 in excess thereof for any
reduction of the Aggregate Maximum Credit Amount, and (ii) $1,000,000 or any
whole multiple of $500,000 in excess thereof for any reduction of the Swing Line
Sublimit or the Letter of Credit Sublimit). Any such notice given shall be
irrevocable and effective only upon receipt by the Administrative
Agent.  The Aggregate Maximum Credit Amount, the Swing Line Sublimit
and the Letter of Credit Sublimit once terminated or reduced may not be
reinstated.

       

      (b)          Subject
to Section
3.04, the Company may, at any time or from time to time,

       

      (i)           prepay
Revolving Credit Loans that are Base Rate Loans, without premium or penalty,
upon notice to the Administrative Agent of not less than one (1) Business Day,
ratably as to each Lender, in whole or in part, in aggregate minimum principal
amounts of $1,000,000 or multiple integrals thereof (unless the outstanding
principal amount of all Revolving Credit Loans that are Base Rate Loans is less
than $1,000,000, then such prepayments shall be equal to such outstanding
principal amount),

       

      (ii)          prepay
Revolving Credit Loans that are LIBOR Loans, without premium or penalty (but
subject to Section
3.04) upon notice to the Administrative Agent not less than three
(3) Business Days,
ratably as to each Lender, prepay Revolving Credit Loans, in whole or in part,
in aggregate minimum principal amounts of $1,000,000 or multiple integrals
thereof plus
all interest and expenses then outstanding on the amount prepaid,
and

       

      
        
          

        

        
          
            	
                     
      

                  	
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      Amended and Restated Credit Agreement – BreitBurn Operating
      L.P.

                  

          

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      (iii)         upon
notice to the Swing Line Lender (with a copy to the Administrative Agent),
voluntarily prepay Swing Line Loans in whole or in part without premium or
penalty; provided that (i) such notice must be received by the Swing Line Lender
and the Administrative Agent not later than 3:00 p.m. Houston, Texas time on the
date of the prepayment, and (ii) any such prepayment shall be in a minimum
principal amount of $200,000.  Each such notice shall specify the date
and amount of such prepayment.  If such notice is given by the
Company, the Company shall make such prepayment and the payment amount specified
in such notice shall be due and payable on the date specified
therein.

       

      Any
notice of prepayment pursuant to clause (i) or (ii) above shall specify the date
and amount of such prepayment and the Interest Rate Type(s) of Revolving Credit
Loans to be prepaid and shall be irrevocable; provided that
(subject to Section
3.04) a notice of prepayment made in connection with any refinancing of
this Agreement (or any other transaction that is intended to provide the funds
for such prepayment) may be conditioned upon the consummation of such
refinancing (or other transaction).  The Administrative Agent will
promptly notify each Lender of its receipt of any such notice, and of such
Lender’s Pro Rata Share of such prepayment.  The payment amount
specified in such notice shall be due and payable on the date specified therein,
together with, in the case of a prepayment pursuant to clauses (ii) and (iii)
above, accrued interest to each such date on the amount prepaid and any amounts
required pursuant to Section
3.04.

       

      2.05        Borrowing Base Determinations;
Mandatory Prepayments of Loans.

       

      (a)           Scheduled Borrowing Base
Determinations.  At all times prior to the Termination Date the
Effective Amount shall not exceed the Borrowing Base then in
effect.  From and after the Effective Date, the initial Borrowing Base
hereunder shall be $735,000,000.00, until redetermined pursuant to the terms of
this Section
2.05.  Upon notice to the Company, the Borrowing Base shall be
redetermined for each Borrowing Base Period on each Scheduled Borrowing Base
Determination Date, and each such redetermination shall be effective as of the
date set forth in such notice of redetermination.  The Borrowing Base
shall be determined based upon the loan collateral value assigned to the Oil and
Gas Properties owned by the Loan Parties and BEP I and such other credit factors
(including without limitation the assets, liabilities, cash flow, business,
properties, prospects, management and ownership of the Loan Parties and BEP I)
which the Lenders deem significant.  The Lenders’ determination of the
Borrowing Base shall be in their sole discretion and shall not be subject to
review or challenge under Sections
11.17 and 11.18
hereof.  Upon each redetermination of the Borrowing Base, the
Administrative Agent shall recommend to the Lenders a new Borrowing Base and the
Lenders in accordance with their customary policies and procedures for extending
credit to Oil and Gas reserve-based customers shall (by unanimous agreement in
the case of Borrowing Base increases and by agreement of the Required Lenders in
the case of Borrowing Base decreases or affirmations) establish the redetermined
Borrowing Base.  If the Company does not furnish the Reserve Reports
or all such other information and data by the date required, the Lenders may
nonetheless determine a new Borrowing Base.  It is expressly
understood that the Lenders shall have no obligation to determine the Borrowing
Base at any particular amount, either in relation to the Aggregate Maximum
Credit Amount or otherwise.

       

      
        
          

        

        
          
            	
                     
      

                  	
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      Amended and Restated Credit Agreement – BreitBurn Operating
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      (b)           Special Borrowing Base
Determinations.

       

      (i)           In
addition to Scheduled Borrowing Base Determinations pursuant to Section
2.05(a), the Company and the Required Lenders may each request one (1)
additional redetermination of the Borrowing Base during each Borrowing Base
Period (“Special Borrowing
Base Determination”). In the event the Company requests a Special
Borrowing Base Determination pursuant to this Section
2.05(b), the Company shall deliver written notice of such request to the
Lenders which shall include: (i) Reserve Report(s) prepared as of a date not
more than thirty (30) calendar days prior to the date of such request, for the
benefit of the Lenders, and (ii) such other information as the Lenders shall
request prepared as of a date not more than thirty (30) calendar days prior to
the date of such request.  Likewise, in the event the Required Lenders
exercise their option for a Special Borrowing Base Determination, the
Administrative Agent shall give the Company notice of the redetermined Borrowing
Base.

       

      (ii)          In
addition to the Special Borrowing Base Determination permitted by Section
2.05(b)(i), a Special Borrowing Base Determination shall be done at the
times set forth in Section
2.14(b).

       

      (c)           Mandatory Prepayment of
Loans.

       

      (i)           If,
after giving effect to any termination or reduction of the Aggregate Maximum
Credit Amounts pursuant to Section
2.04(a), the Effective Amount exceeds the total Commitments, then the
Company shall (A) prepay the Loans on the date of such termination or reduction
in an aggregate principal amount equal to such excess, and (B) if any excess
remains after prepaying all of the Loans, pay to the Administrative Agent on
behalf of the Lenders an amount equal to such excess to be held as cash
collateral in the LC Collateral Account pursuant to Section
2.10(h).

       

      (ii)          If
a Borrowing Base Deficiency shall exist at the time of a Borrowing Base
redetermination or adjustment pursuant to the terms of this Agreement, then the
Company shall, within thirty (30) days after notice from the Administrative
Agent to the Company of the new or adjusted Borrowing Base, exercise any one or
combination of the following:  (A) make a mandatory principal
prepayment in an amount equal to (x) the amount of the Borrowing Base
Deficiency, after giving effect to any action taken under (B) hereof, or (y)
five (5) monthly installments equal to one-fifth of the amount of the Borrowing
Base Deficiency, after giving effect to any action taken under (B) hereof, with
the first such installment due thirty (30) days after notice from the
Administrative Agent to the Company of the new or adjusted Borrowing Base, and
each following installment due thirty (30) days after the preceding installment;
or (B) pledge, or cause its Subsidiaries to pledge, additional unencumbered
collateral of sufficient value and character (as determined by the Lenders in
their sole discretion) that when added to the existing Collateral shall cause
the Borrowing Base to equal or exceed the Effective Amount, after giving effect
to any action taken under (A) hereof.  If, because of the LC
Obligation, a Borrowing Base Deficiency remains after prepaying all of the
Loans, the Company shall pay to the Administrative Agent on behalf of the
Lenders an amount equal to such remaining Borrowing Base Deficiency to be held
as collateral for so long as a Borrowing Base Deficiency remains as provided in
Section
2.10(h).

       

      (iii)         Each
prepayment of Loans pursuant to this Section
2.05(c) shall be applied, first, ratably to any Base Rate Borrowings of
Base Rate Loans then outstanding, and, second, to any LIBOR Borrowings of LIBOR
Loans then outstanding as the Company may direct.

       

      (iv)         Each
prepayment of the Loans pursuant to this Section
2.05(c)
shall be applied, first, to the outstanding Swing Line Loans and, second, to
outstanding Revolving Credit Loans.

       

      (v)     
   Each prepayment of a Borrowing pursuant to this Section
2.05(c) shall be applied to the Loans included in such prepaid Borrowing
in accordance with each Lender’s Pro Rata Share thereof.  Prepayments
of LIBOR Borrowings pursuant to this Section
2.05(c) shall be accompanied by accrued interest on the principal amount
prepaid.

       

      
        
          

        

        
          
            	
                     
      

                  	
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      Amended and Restated Credit Agreement – BreitBurn Operating
      L.P.

                  

          

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      (vi)         Prepayments
permitted or required under this Section
2.05(c) shall be without premium or penalty, but shall be subject to
payment of amounts due pursuant to Section
3.04.

       

      2.06        Repayment.

       

      (a)           Revolving Credit
Loans.  The Company shall repay to the Administrative Agent
(for the account of the Lenders in their respective Pro Rata Shares) the
aggregate principal amount of Revolving Credit Loans outstanding on the
Termination Date, on which date all principal amounts outstanding, plus all accrued but
unpaid interest and other amounts then due hereunder or under the other Loan
Documents, if not sooner paid, shall be due and payable in full.

       

      (b)           Swing Line Loans. The
Company shall repay each Swing Line Loan on the earlier to occur of (i) the
first Swing Line Settlement Date to occur after such Loan is made and (ii) the
Termination Date.

       

      (c)           Interest.

       

      (i)           Each
LIBOR Loan shall bear interest on the aggregate outstanding principal amount
thereof for each Interest Period at a rate per annum equal to the lesser of (A)
LIBOR, plus the Applicable Margin, or (B) the Highest Lawful
Rate.  Each Revolving Credit Loan that is a Base Rate Loan and each
Swing Line Loan shall bear interest on the aggregate outstanding principal
amount thereof from the applicable Borrowing Date or date of conversion or
continuation pursuant to Section
2.03, as the case may be, at a rate per annum equal to the lesser of (A)
the Base Rate plus the Applicable Margin or (B) the Highest Lawful
Rate.

       

      (ii)          Interest
on each Loan shall be paid in arrears on each Interest Payment
Date.  Interest shall also be paid on the date of any prepayment of
Loans under Section
2.04(b) or 2.05(c)
(except in the case of Base Rate Loans) for the portion of the Loans so prepaid
and upon payment (including prepayment) in full thereof and, during the
existence of any Event of Default, interest shall be paid on demand of the
Administrative Agent.

       

      (iii)         Notwithstanding
Section
2.06(c)(i), the Company shall pay interest (after, as well as before,
entry of judgment thereon, to the extent permitted by law) on the principal
amount of all outstanding Loans, at a rate per annum equal to the Default Rate
(A) while any Event of Default under Section
9.01(a)(i) exists and (B) if required by the Majority Banks by notice to
the Company given through the Administrative Agent, while any Event of Default
(other than an Event of Default under Section 9.01
(a)(i)) exists.

       

      2.07        Fees.

       

      (a)           Commitment
Fee.  The Company shall pay to the Administrative Agent, for
the account of the Lenders, an aggregate commitment fee at a per annum rate
equal to the then-applicable Commitment Fee indicated in the Pricing Grid times the actual
daily amount by which the Commitment exceeds the sum of (i) the outstanding
amount of Revolving Credit Loans and (ii) the outstanding amount of LC
Obligations.  Such commitment fee shall accrue from the Effective Date
to the Termination Date and shall be due and payable quarterly in arrears on the
first Business Day of the first month of each quarter commencing on May 1,
2010, through the Termination Date, with the final payment to be made on the
Termination Date.  The commitment fee provided in this subsection
shall accrue at all times after the Effective Date up to the Termination Date,
including at any time during which one or more conditions in Section
5.02 are not met.

       

      
        
          

        

        
          
            Second
Amended and Restated Credit Agreement – BreitBurn Operating
L.P.

          

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      (b)           Letter of Credit Fee.
The Company agrees to pay (i) to Issuing Lender (for the ratable account of the
Lenders in their respective Pro Rata Shares), a fee for each Letter of Credit,
to be paid quarterly in arrears following the Issuance of such Letter of Credit
(including the initial Issuance and any renewal, extension or increase in the
amount thereof) in the amount equal to the greater of (A) $500.00 and (B) the
product equal to the Letter of Credit rate set forth on the Pricing Grid multiplied by the
undrawn amount available under such Letter of Credit (such fee shall be deemed
to be fully earned and owing upon the Issuance of such Letter of Credit, and no
refund shall be due in the event such Letter of Credit is terminated prior to
its expiry date), provided, however, if any
Letter of Credit exists at the time a Lender becomes a Defaulting Lender (X) if
the Company has cash collateralized any portion of such Defaulting Lender’s
Fronting Exposure pursuant to Section
2.15(b),
then the Company shall not be required to pay any fees to such Defaulting Lender
pursuant to this Section
2.07 with respect to such Defaulting Lender’s Fronting Exposure during
the period such Defaulting Lender’s Fronting Exposure is cash collateralized,
(Y) if the non-Defaulting Lenders’ exposure to Letters of Credit is reallocated
pursuant to Section
2.15(d), then the fees payable to the Lenders pursuant to this Section 2.07
shall be adjusted in accordance with the non-Defaulting Lenders’ exposure
to Letters of Credit as so allocated, or (Z) if such Defaulting Lender’s
Fronting Exposure is neither cash collateralized pursuant to Section
2.15(b) nor reallocated pursuant to Section
2.15(d), then, without prejudice to any rights or remedies of the Issuing
Bank or any Lender hereunder, all fees that otherwise would have been payable to
such Defaulting Lender pursuant to this Section
2.07 with respect to such Defaulting Lender’s Fronting Exposure shall be
payable to the Issuing Bank until such Fronting Exposure is cash collateralized
and/or reallocated, and (ii) to the Issuing Lender for its account a fee for the
issuance of each Letter of Credit (including the initial Issuance and any
renewal, extension or increase in the amount thereof), at the Issuance of such
Letter of Credit, in an amount equal to the greater of (A) $500.00 and (B)
one-eighth of one percent (0.125%) multiplied by the
aggregate amount available under each Letter of Credit (such fees shall be
prorated for any period less than a full year but shall not be refunded in the
event any such Letter of Credit is terminated prior to its expiry date) and
(iii) Issuing Lender’s usual and customary fees for amendment to transfer of or
negotiation of the terms of each Letter of Credit.  The Administrative
Agent shall pay to each Lender its Pro Rata Share of the Letter of Credit Fee
paid pursuant to Section
2.07(b)(i).  The Administrative Agent shall pay to the Issuing
Lender the Letter of Credit fees paid pursuant to Section
2.07(b)(ii) and
(iii).

       

      (c)           Agency
Fees.  The Company shall pay fees to the Administrative Agent
for the Administrative Agent’s own account, as required by that certain letter
agreement (“Engagement
Letter”) between the Company and the Administrative Agent dated as of
March 31, 2010, relating hereto.

       

      2.08        Computation of Fees and
Interest.

       

      (a)           All
computations of interest for Base Rate Loans shall be made on the basis of a
year of 365 or 366 days, as the case may be, and actual days elapsed. All other
computations of fees and interest shall be made on the basis of a 360-day year
and actual days elapsed (which results in more interest being paid than if
computed on the basis of a 365-day year). Interest and fees shall accrue during
each period during which interest or such fees are computed from the first day
thereof to the last day thereof.

       

      (b)           Each
determination of an interest rate by the Administrative Agent shall be
conclusive and binding on the Company and the Lenders in the absence of manifest
error.

       

      
        
          

        

        
          
            	
                     
      

                  	
                    Second
      Amended and Restated Credit Agreement – BreitBurn Operating
      L.P.

                  

          

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      2.09        Payments by the Company; Borrowings
Pro Rata.

       

      (a)           All
payments to be made by the Company shall be made without set-off, recoupment or
counterclaim.  All payments by the Company shall be made in
immediately available funds to the Administrative Agent by credit to the
Company’s operating account at the Administrative Agent’s Payment Office for the
account of the Administrative Agent or the Lender to whom such payment is owed,
and shall be made in dollars and in immediately available funds, no later than
12 Noon (Houston, Texas time) on the date specified herein.  Except to
the extent otherwise provided herein, (i) each payment by the Company of fees
shall be made pro rata in accordance with their respective Pro Rata Shares, (ii)
each payment of principal of Revolving Credit Loans shall be made for the
account of the Lenders pro rata in accordance with their respective outstanding
principal amount of Revolving Credit Loans, and (iii) each payment of interest
on Revolving Credit Loans shall be made for the account of the Lenders pro rata
in accordance with their respective shares of the aggregate amount of interest
due and payable to the Lenders.  Notwithstanding the foregoing, to the
extent money is received by the Administrative Agent pursuant to the exercise of
remedies under the Security Documents such money shall be applied to the pro
rata payment of obligations secured by such Security Document.

       

      (b)           The
Administrative Agent will promptly distribute to each Lender its applicable
share of such payment in like funds as received.  Any payment received
by the Administrative Agent later than 12 Noon (Houston, Texas time) may be
deemed by the Administrative Agent to have been received on the following
Business Day and any applicable interest or fee shall continue to
accrue.  When the Administrative Agent collects or receives money on
account of the Obligations or otherwise pursuant to the Security Documents if
such money is insufficient to pay all such Obligations, such money shall be
applied first to any reimbursements due Administrative Agent under Section
11.04 or 11.05.

       

      (c)           Subject
to the provisions set forth in the definition of “Interest Period” herein,
whenever any payment is due on a day other than a Business Day, such payment
shall be made on the following Business Day, and such extension of time shall in
such case be included in the computation of interest or fees, as the case may
be.

       

      (d)           Unless
the Administrative Agent receives notice from the Company prior to the date on
which any payment is due to the Administrative Agent for the account of the
Lenders or the Issuing Lender hereunder that the Company will not make such
payment, the Administrative Agent may assume that the Company has made such
payment on such date in accordance herewith and may, in reliance upon such
assumption, distribute to the Lenders or the Issuing Lender, as the case may be,
the amount due.  In such event, if the Company has not in fact made
such payment, then each of the Lenders or the Issuing Lender, as the case may
be, severally agrees to repay to the Administrative Agent forthwith on demand
the amount so distributed to such Lender or the Issuing 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 Rate and a rate determined by the Administrative
Agent in accordance with banking industry rules on interbank
compensation.

       

      (e)           Except
to the extent otherwise expressly provided herein, each borrowing of Revolving
Credit Loans hereunder shall be from the Lenders pro rata in accordance with
their respective Pro Rata Shares.

       

      2.10        Issuing the Letters of
Credit.

       

      (a)           Subject
to the terms and conditions set forth herein, the Company may request the
Issuing Lender to issue Letters of Credit for its own account or for any of its
Subsidiaries, in a form reasonably acceptable to the Administrative Agent and
the Issuing Lender, at any time and from time to time during the Availability
Period; provided
that the Company may not request the issuance, amendment, renewal or
extension of Letters of Credit hereunder if (i) the Effective Amount exceeds the
Borrowing Base at such time or would exceed the Borrowing Base as a result
thereof, or (ii) the aggregate LC Obligation exceeds the Letter of Credit
Sublimit or would exceed the Letter of Credit Sublimit as a result
thereof.

       

      
        
          

        

        
          
            	
                     
      

                  	
                    Second
      Amended and Restated Credit Agreement – BreitBurn Operating
      L.P.

                  

          

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      (b)           In
order to effect the issuance of a Letter of Credit, the Company shall submit a
Notice of Revolving Credit Borrowing and a LC Application in writing by telecopy
to the Administrative Agent (who shall promptly notify the Issuing Lender) not
later than 1:00 p.m., Houston, Texas time, three (3) Business Days before the
requested date of issuance of such Letter of Credit. Each such Notice of
Revolving Credit Borrowing and LC Application shall be (i) signed by the
Company, (ii) specify the Business Day on which such Letter of Credit is to be
issued, (iii) specify the purpose for the requested Letter of Credit, (iv)
specify the availability for Letters of Credit under (A) the Borrowing Base and
(B) the $50,000,000 aggregate LC Obligation limitation, as of the date of
issuance of such Letter of Credit, (v) specify the expiry date thereof, which
shall not be later than the earlier of (A) twelve (12) months from the date of
issuance of such Letter of Credit and (B) seven (7) Business Days prior to the
Termination Date, and (vi) specify such other matters as may be reasonably
required by the Issuing Lender.

       

      Notwithstanding
Section
2.10(b)(v)(A),
but subject to the other terms and conditions hereof, if the Company so requests
in a LC Application, the Issuing Lender shall issue a Letter of Credit that has
automatic extension provisions (each, an “Auto-Extension
Letter of Credit”).  Any such Auto-Extension Letter of Credit
must permit the Issuing Lender to prevent any such extension at least once in
each twelve-month period (commencing with the date of issuance of such Letter of
Credit) by giving prior notice to the beneficiary thereof not later than a day
(the “Non-Extension
Notice Date”) in each such twelve-month period to be agreed upon at the
time such Letter of Credit is issued.  Unless otherwise directed by
the Issuing Lender, the Company shall not be required to make a specific request
to the Issuing Lender for any such extension.  Once an Auto-Extension
Letter of Credit has been issued, the Lenders shall be deemed to have authorized
(but may not require) the Issuing Lender to permit the extension of such Letter
of Credit at any time to an expiry date not later than the latest date for
expiry of Letters of Credit permitted by this Section
2.10(b); provided, however, that the
Issuing Lender shall not be required to permit any such extension if (A) the
Issuing Lender has determined that it would not be permitted, or would have no
obligation, at such time to issue such Letter of Credit in its revised form (as
extended) under the terms hereof, or (B) it has received notice (which may be by
telephone or in writing) on or before the day that is seven Business Days before
the Non-Extension Notice Date from the Administrative Agent, any Lender or the
Company that one or more of the applicable conditions specified in Section
5.02 is not then satisfied, and in each such case directing the Issuing
Lender not to permit such extension.

       

      (c)           Unless
the Issuing Lender has received written notice from any Lender, the
Administrative Agent or any Loan Party, at least one Business Day prior to the
requested date of issuance or amendment of the applicable Letter of Credit, that
one or more applicable conditions set forth in Article V
shall not have been satisfied, then, subject to the terms and conditions
hereof, the Issuing Lender shall issue such Letter of Credit or amendment, as
the case may be, to the specified beneficiary, in each case in accordance with
the Issuing Lender’s usual and customary business practices. The Issuing Bank
shall provide the Company with a copy of each Letter of Credit so
issued.  Each such Letter of Credit shall, unless otherwise expressly
agreed by the Issuing Lender and the Company at the time such Letter of Credit
is issued, be subject to the rules of the “International Standby Practices
1998” or such later version as may be published by the Institute of
International Banking Law and Practice (the “ISP
1998”), or any successor entity, and shall, as to matters not governed by
the ISP 1998, be governed by, and construed and interpreted in accordance with,
the laws of the State of New York.  The Issuing Lender shall have no
obligation to issue any Letter of Credit if any Lender is at such time a
Defaulting Lender hereunder (unless the Issuing Lender has entered into
satisfactory arrangements with the Company or such Lender to eliminate the
Issuing Lender’s risk with respect to such Lender).

       

      
        
          

        

        
          
            	
                     
      

                  	
                    Second
      Amended and Restated Credit Agreement – BreitBurn Operating
      L.P.

                  

          

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      (d)           Upon
the issuance date of each Letter of Credit, the Issuing Lender shall be deemed,
without further action by any party hereto, to have sold to each other Lender,
and each other Lender shall be deemed, without further action by any party
hereto, to have purchased from the Issuing Lender, a participation, to the
extent of such Lender’s Pro Rata Share, in such Letter of Credit, the
obligations thereunder and in the reimbursement obligations of the Company due
in respect of drawings made under such Letter of Credit.  If requested
by the Issuing Lender, the other Lenders will execute any other documents
reasonably requested by the Issuing Lender to evidence the purchase of such
participation.  Each Lender acknowledges and agrees that its
obligation to acquire participations pursuant to this Agreement in respect of
Letters of Credit is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including any amendment, renewal or extension of any
Letter of Credit or the occurrence and continuance of a Default or Event of
Default, the existence of a Borrowing Base Deficiency or reduction or
termination of the Commitments, and that each such payment shall be made without
any offset, abatement, withholding or reduction whatsoever.

       

      (e)           Upon
the presentment of any draft for honor under any Letter of Credit by the
beneficiary thereof which the Issuing Lender determines is in compliance with
the conditions for payment thereunder, the Issuing Lender shall promptly notify
the Company and the Administrative Agent thereof, but failure to so notify the
Company shall not in any way affect the Company’s obligations
hereunder.  The Company hereby promises and agrees, at the Company’s
option, to either (i) pay to the Administrative Agent for the account of the
Issuing Lender, by 2:00 p.m., Houston, Texas time, on the date payment is due as
specified in such notice, the full amount of such draft in immediately available
funds or (ii) request a Loan pursuant to the provisions of Section 2.01(a)
and
Section 2.02 of this Agreement in the full amount of such draft, which
request shall specify that the Borrowing Date is to be the date payment is due
under the Letter of Credit as specified in the Issuing Lender’s
notice.  The Company will be deemed to have requested a Borrowing of
Base Rate Loans to be disbursed on the intended date of honor in an amount equal
to the unreimbursed drawing, but subject to the conditions set forth in Section
5.02 (other than delivery of a Notice of Borrowing).  If the
Company fails timely to make such payment because a Loan cannot be made pursuant
to Section
2.01(a) and/or Section
5.02, each Lender shall, notwithstanding any other provision of this
Agreement (including the occurrence and continuance of a Default or an Event of
Default), make available to the Administrative Agent for the benefit of the
Issuing Lender an amount equal to its Pro Rata Share of the presented draft on
the day the Issuing Lender is required to honor such draft.  If such
amount is not in fact made available to the Administrative Agent by such Lender
on such date, such Lender shall pay to the Administrative Agent for the account
of the Issuing Lender, on demand made by the Issuing Lender, in addition to such
amount, interest thereon at the Federal Funds Rate for the first two days
following demand and thereafter until paid at the Base Rate.  Upon
receipt by the Administrative Agent from the Lenders of the full amount of such
draft, notwithstanding any other provision of this Agreement (including the
occurrence and continuance of a Default or an Event of Default) the full amount
of such draft shall automatically and without any action by the Company, be
deemed to have been a Base Rate Loan as of the date of payment of such
draft.  Nothing in this Section
2.10(e) or elsewhere in this Agreement shall diminish the Company’s
obligation under this Agreement to provide the funds for the payment of, or on
demand to reimburse the Issuing Lender for payment of, any draft presented to,
and duly honored by, the Issuing Lender under any Letter of Credit, and the
automatic funding of a Loan as in this Section
2.10(e) provided shall not constitute a cure or waiver of the Event of
Default for failure to provide timely such funds as in this Section 2.10(e)
agreed.

       

      
        
          

        

        
          
            	
                     
      

                  	
                    Second
      Amended and Restated Credit Agreement – BreitBurn Operating
      L.P.

                  

          

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      (f)           The
Company’s obligation to reimburse the Issuing Lender for amounts paid on account
of drafts honored under Letters of Credit shall be absolute, unconditional and
irrevocable, and shall be performed strictly in accordance with the terms of
this Agreement under any and all circumstances whatsoever and irrespective of
(1) any lack of validity or enforceability of any Letter of Credit, any LC
Application, or any term or provision therein, (2) any draft or other document
presented under a Letter of Credit proving to be forged, fraudulent or invalid
in any respect or any statement therein being untrue or inaccurate in any
respect, (3) payment by the Issuing Lender under a Letter of Credit issued by
the Issuing Lender against presentation of a draft or other document that does
not comply with the terms of such Letter of Credit or any LC Application, or (4)
any other event or circumstance whatsoever, whether or not similar to any of the
foregoing, that might, but for the provisions of this Section
2.10(f), constitute a legal or equitable discharge of, or provide a right
of setoff against, the Company’s obligations hereunder.  Neither the
Administrative Agent, the Lenders nor the Issuing Lender, nor any of their
Related Parties shall have any liability or responsibility by reason of or in
connection with the issuance or transfer of any Letter of Credit or any payment
or failure to make any payment thereunder (irrespective of any of the
circumstances referred to in the preceding sentence), or any error, omission,
interruption, loss or delay in transmission or delivery of any draft, notice or
other communication under or relating to any Letter of Credit (including any
document required to make a drawing thereunder), any error in interpretation of
technical terms or any consequence arising from causes beyond the control of the
Issuing Lender; provided that the foregoing shall not be construed to excuse the
Issuing Lender from liability to the Company to the extent of any direct damages
(as opposed to consequential damages, claims in respect of which are hereby
waived by the Company to the extent permitted by applicable law) suffered by the
Company that are caused by the Issuing Lender’s failure to exercise care when
determining whether drafts and other documents presented under a Letter of
Credit comply with the terms thereof.  The parties hereto expressly
agree that, in the absence of gross negligence or willful misconduct on the part
of the Issuing Lender (as finally determined by a court of competent
jurisdiction), such Issuing Bank shall be deemed to have exercised all requisite
care in each such determination.  In furtherance of the foregoing and
without limiting the generality thereof, the parties agree that, with respect to
documents presented which appear on their face to be in substantial compliance
with the terms of a Letter of Credit, the Issuing Lender that issued such Letter
of Credit may, in its sole discretion, either accept and make payment upon such
documents without responsibility for further investigation, regardless of any
notice or information to the contrary, or refuse to accept and make payment upon
such documents if such documents are not in strict compliance with the terms of
such Letter of Credit.  The Company hereby waives presentment for
payment (except the presentment required by the terms of any Letter of Credit)
and notice of dishonor, protest and notice of protest with respect to drafts
honored under the Letters of Credit.

       

      (g)           In
the event that any provision of a LC Application is inconsistent with, or in
conflict of, any provision of this Agreement, including provisions for the rate
of interest applicable to drawings thereunder or rights of setoff or any
representations, warranties, covenants or any events of default set forth
therein, the provisions of this Agreement shall govern.

       

      (h)           If
the Obligations, or any part thereof, are declared or otherwise become
immediately due and payable pursuant to Article IX
of this Agreement (for the purposes of this paragraph, the “Matured
Obligations”), then all LC Obligations shall become immediately due and
payable without regard for actual drawings or payments on the Letters of Credit,
and the Company shall be obligated to pay to the Administrative Agent
immediately an amount equal to the LC Obligations.  All amounts made
due and payable by the Company under this Subsection 2.10(h)
may be applied as the Issuing Lender elects to any of the various LC
Obligations; provided, however, that such
amounts applied to the LC Obligations shall be (i) first applied to the Matured
LC Obligation, and (ii) second held by the Administrative Agent for the
benefit of the Issuing Lender and the Lenders as Collateral in the LC Collateral
Account until all remaining Matured Obligations have been
satisfied.  This Subsection
2.10(h) shall not limit or impair any rights which the Administrative
Agent, the Issuing Lender or any of the Lenders may have under any other
document or agreement relating to any Letter of Credit or LC Obligation,
including without limitation, any LC Application. The Company hereby grants a
security interest in and lien on all cash and other funds paid to the
Administrative Agent to be held as cash collateral pursuant to this Section,
the LC Collateral Account and all funds therein, and all proceeds of the
foregoing, to the Administrative Agent for and on behalf of the Lenders as
security for the Obligations.  The Company agrees to execute and
deliver from time to time such documentation as the Administrative Agent may
reasonably request to further assure such security interest.

      
         

        
          
            

          

          
            
              	
                       
      

                    	
                      Second
      Amended and Restated Credit Agreement – BreitBurn Operating
      L.P.

                    

            

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      2.11        Payments to the Administrative Agent;
Several Obligations of the Lenders.

       

      (a)           Unless
the Administrative Agent shall have received notice from a Lender prior to the
proposed date of any Revolving Credit Borrowing of LIBOR Loans (or, in the case
of any Revolving Credit Borrowing of Base Rate Loans, prior to 10:00 a.m.
Houston, Texas time on the date of such Revolving Credit Borrowing) that such
Lender will not make available to the Administrative Agent such Lender’s share
of such Revolving Credit Borrowing, the Administrative Agent may assume that
such Lender has made such share available on such date in accordance with Section
2.02 (or, in the case of a Revolving Credit Borrowing of Base Rate Loans,
that such Lender has made such share available in accordance with and at the
time required by Section
2.02) and may, in reliance upon such assumption, make available to the
Company a corresponding amount.  In such event, if a Lender has not in
fact made its share of the applicable Revolving Credit Borrowing available to
the Administrative Agent, then the applicable Lender and the Company 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 Company to but excluding the date of payment to
the Administrative Agent, at (i) in the case of a payment to be made by such
Lender, the greater of the Federal Funds Rate and a rate determined by the
Administrative Agent in accordance with banking industry rules on interbank
compensation, plus any administrative, processing or similar fees customarily
charged by the Administrative Agent in connection with the foregoing, and (ii)
in the case of a payment to be made by the Company, the interest rate applicable
to the other Loans included in such Borrowing.  If the Company and
such Lender shall pay such interest to the Administrative Agent for the same or
an overlapping period, the Administrative Agent shall promptly remit to the
Company the amount of such interest paid by the Company for such
period.  If such Lender pays its share of the applicable Revolving
Credit Borrowing to the Administrative Agent, then the amount so paid shall
constitute such Lender’s Revolving Credit Loan included in such Revolving Credit
Borrowing.  Any payment by the Company shall be without prejudice to
any claim the Company may have against a Lender that shall have failed to make
such payment to the Administrative Agent.

       

      (b)           Unless
the Administrative Agent shall have received notice from the Company prior to
the date on which any payment is due to the Administrative Agent for the account
of the Lenders or the Issuing Lender hereunder that the Company will not make
such payment, the Administrative Agent may assume that the Company has made such
payment on such date in accordance herewith and may, in reliance upon such
assumption, distribute to the Lenders or the Issuing Lender, as the case may be,
the amount due.  In such event, if the Company has not in fact made
such payment, then each of the Lenders or the Issuing Lender, as the case may
be, severally agrees to repay to the Administrative Agent forthwith on demand
the amount so distributed to such Lender or the Issuing 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 Rate and a rate determined by the Administrative
Agent in accordance with banking industry rules on interbank
compensation.

       

      (c)           The
failure of any Lender to make any Loan on any Borrowing Date, to fund any
participation or to make a payment pursuant to Section
11.04(c) shall not relieve any other Lender of its obligation to do so,
but no Lender shall be responsible for the failure of any other Lender to make
the Loan to be made by such other Lender on any Borrowing Date, to fund any
participation to be funded by such other Lender, or to make any payment pursuant
to Section
11.04(c) to be made by such Lender.

       

      
        
          

        

        
          
            	
                     
      

                  	
                    Second
      Amended and Restated Credit Agreement – BreitBurn Operating
      L.P.

                  

          

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      2.12        Sharing
of Payments.  If
any Lender shall, by exercising any right of setoff or counterclaim or
otherwise, obtain payment in respect of any principal of or interest on any of
its Revolving Credit Loans or the participations in LC Obligations or in Swing
Line Loans held by it resulting in such Lender’s receiving payment of a
proportion of the aggregate amount of its Revolving Credit Loans or
participations and accrued interest thereon greater than its pro rata share
thereof as provided herein, then the Lender receiving such greater proportion
shall

       

      (a)           notify
the Administrative Agent of such fact, and

       

      (b)           purchase
(for cash at face value) participations in the Revolving Credit Loans and
subparticipations in LC Obligations and Swing Line Loans of the other Lenders,
or make such other adjustments as shall be equitable, so that the benefit of all
such payments shall be shared by the Lenders ratably in accordance with the
aggregate amount of principal of and accrued interest on their respective
Revolving Credit Loans and other amounts owing them, 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 Section
2.12 shall not be construed to apply to (x) any payment made by or on
behalf of the Company pursuant to and in accordance with the express terms of
this Agreement (including the application of funds arising from the existence of
a Defaulting Lender, (y) the application of cash collateral provided for in
Section
2.15 or (z) any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Revolving Credit Loans or
subparticipations in LC Obligations or Swing Line Loans to any assignee or
participant.

       

      Each Loan
Party 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 each Loan Party rights of setoff
and counterclaim with respect to such participation as fully as if such Lender
were a direct creditor of each Loan Party in the amount of such
participation.

       

      2.13        Swing
Line Loans.

       

      (a)           The Swing
Line.  Subject to the terms and conditions set forth herein,
the Swing Line Lender agrees, in reliance upon the agreements of the other
Lenders set forth in this Section
2.13(a), to make loans (each such loan, a “Swing Line
Loan”), to the Company from time to time on any Business Day during the
period from the Effective Date to the Termination Date in an aggregate amount
not to exceed at any time outstanding the amount of the Swing Line Sublimit,
notwithstanding the fact that such Swing Line Loans, when aggregated with the
Pro Rata Share of the outstanding amount of Revolving Credit Loans and LC
Obligations of the Lender acting as Swing Line Lender, may exceed the amount of
such Lender’s Commitment; provided, however, that after giving effect to any
Swing Line Loan, (A) the sum of the aggregate outstanding amount of the
Revolving Credit Loans plus the Swing Line Loans plus LC Obligations shall not
exceed the aggregate Commitments at such time, and (B) the sum of the aggregate
outstanding amount of the Revolving Credit Loans of any Lender at such time,
plus such Lender’s Pro Rata Share of the outstanding amount of all LC
Obligations at such time, plus such Lender’s Pro Rata Share of the outstanding
amount of all Swing Line Loans at such time shall not exceed such Lender’s
Commitment.  Within the foregoing limits, and subject to the other
terms and conditions hereof, the Company may borrow under this Section
2.13(a), prepay under Section
2.04(b)(iii), and reborrow under this Section
2.13(a).  Each Swing Line Loan shall bear interest at a rate
based on the Base Rate.  Immediately upon the making of a Swing Line
Loan, each Revolving Credit Lender shall be deemed to, and hereby irrevocably
and unconditionally agrees to, purchase from the Swing Line Lender a risk
participation in such Swing Line Loan in an amount equal to the product of such
Revolving Credit Lender’s Pro Rata Share times the amount of such Swing Line
Loan.  Notwithstanding anything to the contrary contained herein, the
Swingline Lender shall not at any time be obligated to make any Swingline Loan
hereunder if any Lender is at such time a Defaulting Lender, unless the Company
has entered into arrangements satisfactory to the Swingline Lender to eliminate
the Swingline Lender’s risk with respect to such Lender.

       

      
        
          

        

        
          
            	
                     
      

                  	
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      Amended and Restated Credit Agreement – BreitBurn Operating
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      (b)           Borrowing
Procedures.  Each Swing Line Borrowing shall be made upon the
Company’s irrevocable notice to the Swing Line Lender and the Administrative
Agent, which may be given by telephone.  Each such notice must be
received by the Swing Line Lender and the Administrative Agent not later than
3:00 p.m., Houston, Texas time on the requested borrowing date, and shall
specify (A) the amount to be borrowed, which shall be a minimum of $200,000 or
any whole multiple of $50,000 in excess thereof, and (B) the requested borrowing
date, which shall be a Business Day.  Each such telephonic notice must
be confirmed promptly by delivery to the Swing Line Lender and the
Administrative Agent of a written Swing Line Loan Notice, appropriately
completed and signed by a Responsible Officer of the
Company.  Promptly after receipt by the Swing Line Lender of any
telephonic Swing Line Loan Notice, the Swing Line Lender will confirm with the
Administrative Agent (by telephone or in writing) that the Administrative Agent
has also received such Swing Line Loan Notice and, if not, the Swing Line Lender
will notify the Administrative Agent (by telephone or in writing) of the
contents thereof.  Unless the Swing Line Lender has received notice
(by telephone or in writing) from the Administrative Agent (including at the
request of any Lender) prior to 4:00 p.m., Houston, Texas time on the date of
the proposed Swing Line Borrowing (I) directing the Swing Line Lender not to
make such Swing Line Loan as a result of the limitations set forth in the
proviso to the first sentence of Section
2.13(a), (II) that one or more of the applicable conditions specified in
Article
V is not then satisfied, or (III) any Lender is at such time a Defaulting
Lender hereunder (unless the Swing Line Lender has entered into satisfactory
arrangements with the Company or such Lender to eliminate the Swing Line
Lender’s risk with respect to such Lender),then subject to the terms and
conditions hereof, the Swing Line Lender will, not later than 5:00 p.m.,
Houston, Texas time on the borrowing date specified in such Swing Line Loan
Notice, make the amount of its Swing Line Loan available to the Company at its
office by crediting the account of the Company on the books of the Swing Line
Lender in immediately available funds.

       

      (c)           Refinancing of Swing Line
Loans.

       

      (i)           The
Swing Line Lender at any time in its sole and absolute discretion, may request,
on behalf of the Company (which hereby irrevocably authorizes the Swing Line
Lender to so request on its behalf), that each Lender make a Revolving Credit
Loan (which shall be a Base Rate Loan) in an amount equal to such Lender’s Pro
Rata Share of the amount of Swing Line Loans then outstanding.  Such
request shall be made in writing (which written request shall be deemed to be a
Notice of Revolving Credit Borrowing for purposes hereof) and in accordance with
the requirements of Section
2.02, without regard to the minimum and multiples specified therein for
the principal amount of Base Rate Loans, but subject to the unutilized portion
of the aggregate Commitments and the conditions set forth in Section 5.02.  The
Swing Line Lender shall furnish the Company with a copy of the applicable
borrowing notice promptly after delivering such notice to the Administrative
Agent.  Each Lender shall make an amount equal to its Pro Rata Share
of the amount specified in such notice available to the Administrative Agent in
immediately available funds for the account of the Swing Line Lender at the
Administrative Agent’s Payment Office not later than 2:00 p.m. Houston, Texas
time on the day specified in such borrowing notice, whereupon, subject to Section
2.13(c)(ii), each Lender that so makes funds available shall be deemed to
have made a Revolving Credit Loan that is a Base Rate Loan to the Company in
such amount.  The Administrative Agent shall remit the funds so
received to the Swing Line Lender.

       

      
        
          

        

        
          
            	
                     
      

                  	
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      Amended and Restated Credit Agreement – BreitBurn Operating
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      (ii)          If
for any reason any Swing Line Loan cannot be refinanced by such a Revolving
Credit Loan in accordance with Section
2.13(c)(i), the request for Revolving Credit Loans submitted by the Swing
Line Lender as set forth herein shall be deemed to be a request by the Swing
Line Lender that each of the Lenders fund its risk participation in the relevant
Swing Line Loan and each Lender’s payment to the Administrative Agent for the
account of the Swing Line Lender pursuant to Section
2.13(c)(i) shall be deemed payment in respect of such
participation.

       

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

       

      (iv)         Each
Lender’s obligation to make Revolving Credit Loans or to purchase and fund risk
participations in Swing Line Loans pursuant to this Section
2.13(c) shall be absolute and unconditional and shall not be affected by
any circumstance, including (A) any setoff, counterclaim, recoupment, defense or
other right which such Lender may have against the Swing Line Lender, the
Company or any other Person for any reason whatsoever, (B) the occurrence or
continuance of a Default, or (C) any other occurrence, event or condition,
whether or not similar to any of the foregoing.  No such funding of
risk participations shall relieve or otherwise impair the obligation of the
Company to repay Swing Line Loans, together with interest as provided
herein.

       

      (d)           Repayment of
Participations.

       

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

       

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

       

      (e)           Interest for Account of
Swing Line Lender.  The Swing Line Lender shall be responsible
for invoicing the Company for interest on the Swing Line Loans.  Until
each Lender funds it Revolving Credit Loan or risk participation pursuant to
this Section
2.13(e) to refinance such Lender’s Pro Rata Share of any Swing Line Loan,
interest in respect of such Pro Rata Share shall be solely for the account of
the Swing Line Lender.

       

      
        
          

        

        
          
            	
                     
      

                  	
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      L.P.

                  

          

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

       

      2.14        Special
Provisions Applicable to BEP I.

       

      (a)           Notwithstanding
anything to the contrary set forth in this Agreement or any other Loan Document,
for so long as BEP I is not a Wholly Owned Subsidiary of Parent, (x) BEP I shall
not be required to execute a Guaranty or grant Liens on its property or assets
to secure the Obligations, and (y) the occurrence of a BEP I Default shall not
constitute a Default or an Event of Default under this Agreement.  Any
of the following shall constitute a “BEP I
Default”:  (i) BEP I incurs any Indebtedness, (ii) the failure
of the Loan Parties to cause BEP I to comply with one or more covenants in this
Agreement that are applicable to Restricted Subsidiaries and expiration of the
applicable grace period set forth in this Agreement, if any, (iii) failure of a
representation and warranty contained in this Agreement to be correct with
respect to BEP I or the Oil and Gas Properties owned by it, and (iv) any of the
events or circumstances described in Section 9.01(f)
or 9.01(g)
occur with respect to BEP I or any of its subsidiaries.  

       

      (b)           Upon
the occurrence of a BEP I Default, the Required Lenders may request a Special
Borrowing Base Determination.

       

      (c)           This
Section
2.14 shall cease to apply when BEP I is a Wholly Owned Subsidiary of
Parent, or, if earlier, when agreed by the Company.

       

      2.15        Defaulting
Lenders.

       

      (a)           Notwithstanding
any provision of this Agreement to the contrary, if any Lender becomes a
Defaulting Lender, then the following provisions shall apply for so long as such
Lender is a Defaulting Lender:

       

      (i)           fees
shall cease to accrue on the unfunded portion of the Commitment of such
Defaulting Lender pursuant to Section
2.07(a); and

       

      (ii)          the
Commitment and the sum of the outstanding principal amount of the Loans of such
Defaulting Lender shall not be included in determining whether all Lenders, the
Majority Lenders, or the Required Lenders have taken or may take any action
hereunder (including any consent to any amendment or waiver pursuant to Section
11.01), provided that (A) any
waiver, amendment or modification requiring the consent of all Lenders or each
affected Lender which directly affects such Defaulting Lender shall require the
consent of such Defaulting Lender, and (B) the Commitment of such Defaulting
Lender may not be increased or extended without the consent of such Defaulting
Lender.

       

      (b)           Cash
Collateral.

       

      (i)           At
any time that there shall exist a Defaulting Lender, if the reallocation
described in Section 2.15(d)
cannot, or can only partially, be effected then, within three Business
Days of the request of the Administrative Agent, the Issuing Lender or the
Swingline Lender, the Company shall deliver to the Administrative Agent cash
collateral in an amount sufficient to cover all Fronting Exposure after taking
into account any reallocation pursuant to Section
2.15(d).  Notwithstanding anything to the contrary contained in
this Agreement, cash collateral provided under Section
2.05(c)(i), this Section 2.15,
or Section
9.02 in respect of Letters of Credit or Swing Line Loans shall be held
and applied to the satisfaction of the specific LC Obligation, Swing Line Loans,
obligations to fund participations therein and other obligations for which the
Cash Collateral was so provided, prior to any other application of such property
as may be provided for herein.

       

      
        
          

        

        
          
            	
                     
      

                  	
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      Amended and Restated Credit Agreement – BreitBurn Operating
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      (ii)          Cash
Collateral (or the appropriate portion thereof) provided to reduce Fronting
Exposure shall be released promptly following (i) the elimination of the
applicable Fronting Exposure or other obligations giving rise thereto (including
by the termination of Defaulting Lender status of the applicable Lender or by
replacement of the applicable Defaulting Lender by assignment made in accordance
with this Agreement) or (ii) the Administrative Agent’s good faith determination
that there exists excess cash collateral; provided, however, that cash
collateral furnished by or on behalf of a Loan Party shall not be released
during the continuance of a Default or Event of Default (and following
application as provided in this Section
2.15 may be otherwise applied in accordance with Section
9.02).

       

      (c)           Reallocation
of Payments.  Any payment of principal, interest, fees or other
amounts received by the Administrative Agent for the account of that Defaulting
Lender (whether voluntary or mandatory, at maturity, pursuant to Article
VIII or otherwise, and including any amounts made available to the
Administrative Agent by that Defaulting Lender pursuant to Section
10.08), shall be applied at such time or times as may be determined by
the Administrative Agent as follows:

       

      first, to
the payment of any amounts owing by that Defaulting Lender to the Administrative
Agent hereunder;

       

      second,
to the payment on a pro rata basis of any amounts owing by that Defaulting
Lender to the Issuing Lender or Swing Line Lender hereunder;

       

      third, if
so determined by the Administrative Agent or requested by the Issuing Lender or
Swing Line Lender, to be held as cash collateral for future funding obligations
of that Defaulting Lender of any participation in any Swing Line Loan or Letter
of Credit, unless the Administrative Agent has previously received cash
collateral in an amount sufficient to cover future funding obligations after
taking into account any reallocation of that Defaulting Lender’s participation
obligation;

       

      fourth,
as the Company may request (so long as no Default or Event of Default exists),
to the funding of any Loan in respect of which that Defaulting Lender has failed
to fund its portion thereof as required by this Agreement, as determined by the
Administrative Agent;

       

      fifth, if
so determined by the Administrative Agent and the Company, to be held in an
interest bearing deposit account and released in order to satisfy obligations of
that Defaulting Lender to fund Loans under this Agreement;

       

      sixth, so
long as no Default or Event of Default exists, to the payment of any amounts
that Company certifies in writing are owed from such Defaulting Lender or its
Affiliate that is a Lender Derivative Provider under any Derivative Contract;
and

       

      seventh,
to that Defaulting Lender or as otherwise directed by a court of competent
jurisdiction; provided that if (x) such payment is a payment of the principal
amount of any Loans or Matured LC Obligations in respect of which that
Defaulting Lender has not fully funded its appropriate share and (y) such Loans
or Matured LC Obligations were made at a time when the conditions set forth in
Section
5.02 were satisfied or waived, such payment shall be applied solely to
pay the Loans of, and Matured LC Obligations owed to, all non-Defaulting Lenders
on a pro rata basis prior to being applied to the payment of any Loans of, or
Matured LC Obligations owed to, that Defaulting Lender.  Any payments,
prepayments or other amounts paid or payable to a Defaulting Lender that are
applied (or held) to pay amounts owed by a Defaulting Lender or to post cash
collateral pursuant to this Section
2.15(c) shall be deemed paid to and redirected by that Defaulting Lender,
and each Lender irrevocably consents hereto.

       

      
        
          

        

        
          
            	
                     
      

                  	
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      (d)           Reallocation of Pro Rata
Share to Reduce Fronting Exposure.  During any period in which
there is a Defaulting Lender, the Fronting Exposure shall be reallocated among
the non-Defaulting Lenders in accordance with the Pro Rata Shares (computed
without giving effect to the Commitment of that Defaulting Lender), and for
purposes of computing the amount of the obligation of each non-Defaulting Lender
to acquire, refinance or fund participations in Letters of Credit or Swing Line
Loans pursuant to Sections 2.10
and
2.13, the “Pro Rata Share” of each non-Defaulting Lender shall be
computed without giving effect to the Commitment of that Defaulting Lender;
provided, that, (i) each such reallocation shall be given effect only if, at the
date the applicable Lender becomes a Defaulting Lender, no Default or Event of
Default exists; and (ii) the aggregate obligation of each non-Defaulting Lender
to acquire, refinance or fund participations in Letters of Credit and Swing Line
Loans shall not exceed the positive difference, if any, of (1) the Commitment of
that non-Defaulting Lender minus (2) the outstanding principal amount of Loans
owed to such non-Defaulting Lender.

       

      (e)           Defaulting Lender
Cure.  In the event that the Administrative Agent and the
Company each agrees that a Defaulting Lender has adequately remedied all matters
that caused such Defaulting Lender to be a Defaulting Lender, then the
Administrative Agent shall notify the Lenders and on the effective date
specified in such notice, and such Lender shall purchase at par such of the
Loans of the other Lenders as the Administrative Agent shall determine may be
necessary in order for such Defaulting Lender to hold such Loans in accordance
with its Pro Rata Share.

       

      ARTICLE
III.

       

      TAXES,
YIELD PROTECTION AND ILLEGALITY;

      REPLACEMENT
OF LENDERS

       

      3.01        Taxes.

       

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

       

      (b)           Payment of Other Taxes by
the Company.  Without limiting the provisions of Section 3.01(a)
above, the Company shall timely pay any Other Taxes to the relevant
Governmental Authority in accordance with Requirements of Law.

       

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

       

      
        
          

        

        
          
            	
                     
      

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

       

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

       

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

       

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

       

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

       

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

       

      (iv)         if
a payment made to a Lender under any Loan Document would be subject to a
withholding Tax imposed by FATCA as a result of such Lender failing to comply
with the applicable reporting requirements of FATCA (including those contained
in Sections 1471(b) or
1472(b) of the Code, as
applicable), such Lender shall deliver documentation or certifications as are
required to evidence compliance by the Lender with FATCA for purposes of
determining if the Lender is subject to such withholding Tax, or

       

      
        
          

        

        
          
            	
                     
      

                  	
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      (v)    
     any other form prescribed by Requirements of Law
as a basis for claiming exemption from or a reduction in United States Federal
withholding Tax duly completed together with such supplementary documentation as
may be prescribed by Requirements of Law to permit the Company to determine the
withholding or deduction required to be made.

       

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

       

      3.02        Illegality.

       

      (a)           If
any Lender determines that the introduction of any Requirement of Law, or any
change in any Requirement of Law, or in the interpretation or administration of
any Requirement of Law, has, since the Effective Date, made it unlawful, or
that, since the Effective Date, any central bank or other Governmental Authority
has asserted that it is unlawful, for any Lender or its applicable Lending
Office to make LIBOR Loans, then, on notice thereof by the Lender to the Company
through the Administrative Agent, any obligation of that Lender to make LIBOR
Loans shall be suspended until the Lender notifies the Administrative Agent and
the Company that the circumstances giving rise to such determination no longer
exist; such notice to be promptly given upon the determination that such
circumstances no longer exist.

       

      (b)           If
a Lender determines that it is unlawful to maintain any LIBOR Loan, the Company
shall, upon its receipt of notice of such fact and demand from such Lender (with
a copy to the Administrative Agent), convert such LIBOR Loans of that Lender
then outstanding into a Base Rate Loan without regard to conditions precedent
described in Section
5.02(b), either on the last day of the Interest Period thereof, if the
Lender may lawfully continue to maintain such LIBOR Loans to such day, or
immediately, if the Lender may not lawfully continue to maintain such LIBOR
Loan.  Upon any such conversion, the Company shall pay accrued
interest on the amount so converted.  In addition, if any such
conversion occurs on a day which is not the last day of the then current
Interest Period with respect thereto, the Company shall pay the affected Lender
such amounts, if any, as may be required pursuant to Section
3.04.

       

      (c)           If
the obligation of any Lender to make or maintain LIBOR Loans has been so
terminated or suspended, all Loans which would otherwise be made or maintained
by the Lender as LIBOR Loans shall be instead Base Rate Loans.

       

      (d)           Before
giving any notice to the Administrative Agent under this Section, the affected
Lender shall designate a different Lending Office with respect to its LIBOR
Loans if such designation will avoid the need for giving such notice or making
such demand and will not, in the judgment of the Lender, be illegal or otherwise
disadvantageous to the Lender.

       

      
        
          

        

        
          
            	
                     
      

                  	
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      3.03        Increased Costs and Reduction of
Return.

       

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

       

      (i)           impose,
modify or deem applicable any reserve, special deposit, compulsory loan,
insurance charge or similar requirement against assets of, deposits with or for
the account of, or credit extended or participated in by, any Lender (except any
reserve requirement included in the calculation of the LIBOR) or the Issuing
Lender; or

       

      (ii)  
       impose on any Lender or the Issuing
Lender or the London interbank market any other condition, cost or expense
affecting this Agreement or LIBOR Loans made by such Lender or any Letter of
Credit or participation therein;

       

      and the
result of any of the foregoing shall be to increase the cost to such Lender
(other than Taxes) of making or maintaining any LIBOR Loan (or of maintaining
its obligation to make any such Loan), or to increase the cost to such Lender or
the Issuing Lender (other than Taxes) of participating in, issuing or
maintaining any Letter of Credit (or of maintaining its obligation to
participate in or to issue any Letter of Credit), or to reduce the amount of any
sum received or receivable by such Lender or the Issuing Lender hereunder
(whether of principal, interest or any other amount) then, upon request of such
Lender or the Issuing Lender, the Company will pay to such Lender or the Issuing
Lender, as the case may be, such additional amount or amounts as will compensate
such Lender or the Issuing Lender, as the case may be, for such additional costs
incurred or reduction suffered.

       

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

       

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

       

      
        
          

        

        
          
            	
                     
      

                  	
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      (d)           Delay in
Requests.  Failure or delay on the
part of any Lender or the Issuing Lender to demand compensation pursuant to this
Section shall not constitute a waiver of such Lender’s or the Issuing Lender’s
right to demand such compensation, provided that the Company shall not be required
to compensate a Lender or the Issuing Lender pursuant to this Section for any
increased costs incurred or reductions suffered more than nine months prior to
the date that such Lender or the Issuing Lender, as the case may be, notifies
the Company of the Change in Law giving rise to such increased costs or
reductions and of such Lender’s or the Issuing Lender’s intention to claim
compensation therefor (except that, if the Change in Law giving rise to such
increased costs or reductions is retroactive, then the nine-month period
referred to above shall be extended to include the period of retroactive effect
thereof).

       

      3.04        Funding
Losses.  The
Company shall reimburse each Lender and hold each Lender harmless from any loss
or expense excluding consequential losses which the Lender may sustain or incur
as a consequence of: (a) the failure of the Company to make on a timely basis
any payment of principal of any LIBOR Loan; (b) the failure of the Company to
borrow, continue or convert a Loan after the Company has given (or is deemed to
have given) a Notice of Revolving Credit Borrowing or a Notice of
Conversion/Continuation (including by reason of the failure to satisfy any
condition precedent thereto); (c) the failure of the Company to make any
prepayment in accordance with any notice delivered under Section
2.04; (d) the prepayment (including pursuant to Section
2.05 or 2.06) or
other payment (including after acceleration thereof) of a LIBOR Loan on a day
that is not the last day of the relevant Interest Period; or (e) the automatic
conversion under Section
2.03 of any LIBOR Loan to a Base Rate Loan on a day that is not the last
day of the relevant Interest Period; including any such loss or expense arising
from the liquidation or reemployment of funds obtained by it to maintain its
LIBOR Loans or from fees payable to terminate the deposits from which such funds
were obtained but excluding any loss of Applicable Margin after the date of such
failure, prepayment or conversion.  For purposes of calculating
amounts payable by the Company to the Lenders under this Section and under Section
3.03(a), each LIBOR Loan made by a Lender (and each related reserve,
special deposit or similar requirement) shall be conclusively deemed to have
been funded at the LIBOR used in determining the interest rate for such LIBOR
Loan by a matching deposit or other borrowing in the interbank eurodollar market
for a comparable amount and for a comparable period, whether or not such LIBOR
Loan is in fact so funded.

       

      3.05        Inability
to Determine Rates.  If
Administrative Agent determines that for any reason adequate and reasonable
means do not exist for determining the LIBOR for any requested Interest Period
with respect to a proposed LIBOR Loan, or if the Majority Lenders notify the
Administrative Agent that the LIBOR applicable pursuant to Section
2.06(c) for any requested Interest Period with respect to a proposed
LIBOR Loan does not adequately and fairly reflect the cost to such Lenders of
funding such Loan, the Administrative Agent will promptly so notify the Company
and each Lender.  Thereafter, the obligation of the Lenders to make or
maintain LIBOR Loans hereunder shall be suspended until the Administrative Agent
upon the instruction of the Majority Lenders revokes such notice in writing;
such written revocation to be promptly given upon determination that such
circumstances no longer exist.  Upon receipt of such notice, the
Company may revoke any Notice of Revolving Credit Borrowing or Notice of
Conversion/Continuation then submitted by it.  If the Company does not
revoke such notice, the Lenders shall make, convert or continue the Loans, as
proposed by the Company, in the amount specified in the applicable notice
submitted by the Company, but such Loans shall be made, converted or continued
as Base Rate Loans instead of LIBOR Loans.

       

      3.06        Certificates
of Lenders.  Any
Lender claiming reimbursement or compensation under this Article
III shall deliver to the Company (with a copy to the Administrative
Agent) a certificate setting forth in reasonable detail the amount payable to
the Lender hereunder and such certificate shall be conclusive and binding on the
Company in the absence of manifest error provided, however, that such Lender
shall only be entitled to collect amounts incurred within 180 days of such
notice.

       

      
        
          

        

        
          
            	
                     
      

                  	
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      3.07        Mitigation Obligations; Replacement
of Lenders.

       

      (a)           Designation of a Different
Lending Office.  If any Lender requests compensation under
Section
3.03, or requires the Company to pay any additional amount to any Lender
or any Governmental Authority for the account of any Lender pursuant to Section
3.01, then such Lender shall use reasonable efforts to designate a
different lending office for funding or booking its Loans hereunder or to assign
its rights and obligations hereunder to another of its offices, branches or
affiliates, if, in the judgment of such Lender, such designation or assignment
(i) would eliminate or reduce amounts payable pursuant to Section
3.01 or 3.03, 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 in its sole discretion.  The Company hereby agrees to pay all
reasonable costs and expenses incurred by any Lender in connection with any such
designation or assignment.

       

      (b)           Replacement of
Lenders.  If (i) any Lender requests compensation under Section
3.03, (ii) the Company is required to pay any additional amount to any
Lender or any Governmental Authority for the account of any Lender pursuant to
Section
3.01, (iii) the obligation of any Lender to make, continue or convert
Base Rate Loans into LIBOR Loans is suspended under Section
3.02, (iv) any Lender is a Defaulting Lender, or (v) any Lender refuses
to consent to any amendment, waiver or other modification of any Loan Document
requested by the Company that requires the consent of a greater percentage of
the Lenders than the Majority Lenders and such amendment, waiver or other
modification is consented to by the Majority Lenders, then the Company may, at
its sole expense and effort, upon notice to such Lender and the Administrative
Agent, require such Lender to assign and delegate, without recourse (in
accordance with and subject to the restrictions contained in, and consents
required by, Section
11.06), all of its interests, rights and obligations under this Agreement
and the related Loan Documents to an assignee that shall assume such obligations
(which assignee may be another Lender, if a Lender accepts such assignment),
provided that:

       

      (i)           the
Company shall have paid to the Administrative Agent the assignment fee specified
in Section
11.06;

       

      (ii)         such
Lender shall have received payment of an amount equal to the outstanding
principal of its Loans and participations in LC Obligations, accrued interest
thereon, accrued fees and all other amounts payable to it hereunder and under
the other Loan Documents (including any amounts under Section
3.04) from the assignee (to the extent of such outstanding principal and
accrued interest and fees) or the Company (in the case of all other
amounts);

       

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

       

      (iv)         such
assignment does not conflict with applicable law.

       

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

       

      3.08        Survival.  The
agreements and obligations of the Company in this Article
III shall survive the payment of all other Obligations.

       

      
        

      

      
        
          	
                   
      

                	
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    ARTICLE
IV.

     

    SECURITY

     

    4.01           The
Security.  The
Obligations will be secured by the Security Documents described in Schedule
4.01 and any additional Security Documents hereafter delivered by the
Loan Parties and accepted by the Administrative Agent.

     

    4.02           Agreement
to Deliver Security Documents.  The
Loan Parties agree to deliver to further secure the Obligations whenever
requested by the Administrative Agent in its sole and absolute discretion, deeds
of trust, mortgages, chattel mortgages, security agreements, financing
statements and other Security Documents in form and substance reasonably
satisfactory to the Administrative Agent for the purpose of granting,
confirming, and perfecting first and prior liens or security interests on
substantially all assets of Parent, the Company and their present and future
Subsidiaries, including Oil and Gas Properties representing not less than 80% of
the total present value (determined by a discount factor of 10%) of the Oil and
Gas Properties evaluated in the most recently delivered Reserve
Report.  The Loan Parties also agree to deliver whenever requested by
the Lenders, title opinions from legal counsel reasonably acceptable to the
Lenders or such other evidence of title reasonably satisfactory to the Lenders
with respect to the Mortgaged Properties designated by the Lenders, based upon
abstract or record examinations to dates reasonably acceptable to the Lenders
and (a) stating that the Loan Party, as applicable, has good and defensible
title to such properties and interests, free and clear of all Liens except
Permitted Liens, (b) confirming that such Oil and Gas Properties are subject to
Security Documents securing the Obligations that constitute and create legal,
valid and duly perfected deed of trust or mortgage liens in such Oil and Gas
Properties and assignments of and security interests in the Oil and Gas
attributable to such Oil and Gas Properties and the proceeds thereof, in each
case subject only to Permitted Liens, and (c) covering such other matters as the
Lenders may reasonably request.

     

    4.03           Perfection
and Protection of Security Interests and Liens.

     

    (a)           The
Loan Parties will from time to time deliver to the Administrative Agent any
financing statements, amendment, assignment and continuation statements,
extension agreements and other documents, properly completed and executed (and
acknowledged when required) by each Loan Party, as applicable, in form and
substance reasonably satisfactory to the Administrative Agent, which the
Administrative Agent reasonably requests for the purpose of perfecting,
confirming, or protecting any Liens or other rights in Collateral securing any
Obligations.

     

    (b)           In
the case of properties other than Oil and Gas Properties, this Agreement and the
other Loan Documents shall not require the creation or perfection of Liens in
particular properties or assets if and for so long as, in the reasonable
judgment of the Administrative Agent, the cost of creating or perfecting such
Liens in such property shall be excessive in view of the benefits to be obtained
by the Lenders therefrom.  The Administrative Agent may grant
extensions of time for the creation and perfection of Liens in particular assets
or property where it determines, in consultation with the Company, that such
action cannot be accomplished without undue effort or expense by the time or
times at which it would otherwise be required by this Agreement or the other
Loan Documents.

     

    4.04           Offset.  To
secure the repayment of the Obligations the Company hereby grants the
Administrative Agent and each Lender a security interest, a lien, and a right of
offset, each of which shall be in addition to all other interests, liens, and
rights of the Administrative Agent at common law, under the Loan Documents, or
otherwise, and each of which shall be upon and against (a) any and all moneys,
securities or other property (and the proceeds therefrom) of the Company now or
hereafter held or received by or in transit to the Administrative Agent or any
Lender from or for the account of the Company, whether for safekeeping, custody,
pledge, transmission, collection or otherwise, (b) any and all deposits (general
or special, time or demand, provisional or final) of the Company with the
Administrative Agent or any Lender, and (c) any other credits and claims of the
Company at any time existing against the Administrative Agent or any Lender,
including claims under certificates of deposit. During the existence of any
Event of Default, the Administrative Agent or any Lender is hereby authorized to
foreclose upon, offset, appropriate, and apply, at any time and from time to
time, without notice to the Company, any and all items hereinabove referred to
against the Obligations then due and payable.

    
       

    

    
      
        

      

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    4.05           Subsidiary Guaranty and Security
Agreement.

     

    (a)           Each
Subsidiary of a Loan Party now existing or created, acquired or coming into
existence after the date hereof, including without limitation, each of the
Guarantors, shall pursuant to Section
7.15, promptly upon request by the Administrative Agent, execute and
deliver to the Administrative Agent an absolute and unconditional guaranty of
the timely repayment, and the due and punctual performance, of the Obligations
of the Company hereunder, which Guaranty shall be substantially in the form and
substance of Exhibit G,
a Security Agreement substantially in the form of Exhibit
H, and
Security Documents as required by Section
4.02.  The Company and
its Subsidiaries will cause each of their Subsidiaries to deliver to the
Administrative Agent, simultaneously with its delivery of such Guaranty and
Security Agreement, (x) written evidence satisfactory to the Administrative
Agent that such Subsidiary has taken all organizational action necessary to duly
approve and authorize its execution, delivery and performance of such Guaranty,
Security Agreement and any other documents which it is required to execute, and
(y) such additional closing documents, certificates and opinions of counsel as
the Administrative Agent shall require.

     

    (b)           Each
Loan Party is mutually dependent on each other in the conduct of their
respective businesses, with the credit needed from time to time by each often
being provided by another or by means of financing obtained by one such
Affiliate with the support of the other for their mutual benefit and the ability
of each to obtain such financing is dependent on the successful operations of
the other. The board of directors, managers or general partner, where
applicable, of each Guarantor has determined that such Guarantor’s execution,
delivery and performance of this Agreement may reasonably be expected to
directly or indirectly benefit such Guarantor and is in the best interests of
such Guarantor.

     

    (c)           The
direct or indirect value of the consideration received and to be received by
such Guarantor in connection herewith is reasonably worth at least as much as
the liability and obligations of each Guarantor hereunder, and the incurrence of
such liability and obligations in return for such consideration may reasonably
be expected to benefit such Guarantor, directly or indirectly.

     

    ARTICLE
V.

     

    CONDITIONS
PRECEDENT

     

    5.01           Conditions
of Initial Credit Extensions.  The
effectiveness of this Agreement and the obligation of each Lender to make its
initial Loan hereunder and the obligation of the Issuing Lender to issue Letters
of Credit hereunder, are subject to the condition that the Administrative Agent
shall have received all of the following, in form and substance satisfactory to
the Administrative Agent:

     

    (a)           Credit Agreement and
Notes.  This Agreement, the Notes, amendments to Mortgages, and
the Master Reaffirmation and Amendment to Guaranties and Security Agreements
executed by each party thereto;

     

    
      
        

      

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    (b)           Resolutions; Incumbency;
Organization Documents, Good Standing. A certificate of the Secretary or
Assistant Secretary or a Responsible Officer with similar responsibilities of
each Loan Party, or in the event that such Loan Party is a limited partnership,
such Person’s general partner, certifying as of the Effective Date: (i)
Resolutions of its board of directors or members, authorizing the transactions
contemplated hereby; (ii) the names and genuine signatures of the Responsible
Officers of such Person, authorized to execute, deliver and perform, as
applicable, this Agreement, the Notes, the Guaranties, the Security Documents,
and all other Loan Documents to be delivered by such Person; (iii) the
Organization Documents of such Person as in effect as of the Effective Date;
(iv) the good standing certificate for such Person, from its state of
incorporation, formation or organization, as applicable, dated as of a recent
date; and (v) as may be required by the Administrative Agent, certificate(s) of
authority for such Person from states wherein such Person conducts business,
evidencing such Person’s qualification to do business in such state, dated as of
a recent date;

     

    (c)           Certificate of a Responsible
Officer of Parent.  A certificate signed by a Responsible
Officer of Parent as follows:

     

    (i)           certifying
that no Default or Event of Default exists or will result, both before and after
giving effect to the making of extensions of credit by the Lenders on the
Effective Date;

     

    (ii)          certifying
that the representations and warranties of the Company and the other Loan
Parties contained in Article
VI and in the other Loan Documents delivered on the Effective Date are
true and correct in all material respects, before and after giving effect to the
extensions of credit by the Lenders on the Effective Date;

     

    (iii)         certifying
that after giving effect to the incurrence on the Effective Date of Indebtedness
hereunder, the Parent is Solvent, the Company is Solvent, and
the  Loan Parties taken as a whole are Solvent, and

     

    (iv)        attaching
and certifying insurance certificates from the Company’s insurance carriers
reflecting the current insurance policies required under Section
7.08 including any necessary endorsements to reflect the Administrative
Agent as additional insured and loss payee;

     

    (d)           Pricing Grid
Certificate.  A Pricing Grid Certificate, prepared by giving
effect to the initial Loans on the Effective Date;

     

    (e)           Payment of
Fees.  Evidence of payment by the Company of all accrued and
unpaid fees, costs and expenses owed pursuant to this Agreement to the extent
then due and payable on the Effective Date, including any such costs, fees and
expenses arising under or referenced in Sections 2.07
and
11.04, including, to the extent invoiced on or prior to the Effective
Date, all fees, charges and disbursements of counsel to the Administrative
Agent;

     

    (f)       
    Opinion of
Counsel.  Opinions of Company’s general counsel, Vinson &
Elkins L.L.P., as counsel for the Loan Parties, and such opinions of local
counsel for the Loan Parties, covering such matters as the Administrative Agent
may require and in form and substance satisfactory to the Administrative Agent,
dated as of the Effective Date;

     

    (g)           Notice.  The
Administrative Agent shall have received a Notice of Revolving Credit Borrowing,
a request for a Letter of Credit pursuant to Section
2.10 or a request for a Swing Line Loan pursuant to Section
2.13, as applicable; and

     

    
      
        

      

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    (h)           Other
Documents.  Such other approvals, opinions, documents or
materials as the Administrative Agent or any Lender may reasonably
request.

     

    5.02           Conditions
to Extensions of Credit.  The
obligation of each Lender to make any Loan (including Loans made on the
Effective Date) or to convert any Revolving Credit Loan into a LIBOR Loan under
Section
2.03 (but specifically excluding the continuation of LIBOR Loans on the
last day of the Interest Period therefor), and the obligation of the Issuing
Lender to issue, amend, renew or extend any Letter of Credit, is subject to the
satisfaction of the following conditions precedent:

     

    (a)           Notice.  The
Administrative Agent shall have received a Notice of Revolving Credit Borrowing,
a Notice of Conversion/Continuation, a request for a Letter of Credit pursuant
to Section
2.10 or a request for a Swing Line Loan pursuant to Section
2.13, as applicable;

     

    (b)           Continuation of
Representations and Warranties. The representations and warranties of the
Company and the Guarantors in Article VI
and in the other Loan Documents shall be true and correct in all material
respects on and as of the date of such Credit Extension or conversion, as
applicable, before and after giving effect to such Credit Extension or
conversion (except to the extent such representations and warranties expressly
refer to an earlier date, in which case they shall be true and correct in all
material respects as of such earlier date, and except that for purposes of this
Section
5.02(b), the representations and warranties contained in Sections
(a) and (b) of
Section
6.14 shall be deemed to refer to the most recent statements furnished
pursuant to clauses (a)
and (b),
respectively, of Section
7.01);

     

    (c)           No Material Adverse
Effect.  At the time of and immediately after giving effect to
such Borrowing or conversion or the issuance, amendment, renewal or extension of
such Letter of Credit, as applicable, no Material Adverse
Effect shall have occurred or shall exist; and

     

    (d)          No Existing
Default.  At the time of and immediately after giving effect to
such Borrowing or conversion or the issuance, amendment, renewal or extension of
such Letter of Credit, as applicable, no Default or Event of
Default shall exist.

     

    Each
Notice of Revolving Credit Borrowing, Notice of Conversion/Continuation (other
than a Notice of Conversion/Continuation requesting only continuation of LIBOR
Loans on the last day of the Interest Period therefor) and request for issuance,
amendment, renewal or extension of a Letter of Credit submitted by the Company
hereunder shall constitute a representation and warranty by the Company on the
date thereof that the conditions in Section
5.02 are satisfied.

     

    ARTICLE
VI.

     

    REPRESENTATIONS
AND WARRANTIES

     

    Each of
the Loan Parties represents and warrants to the Administrative Agent and each
Lender that:

     

    6.01           Organization,
Existence and Power.  Each
Loan Party and each of its Subsidiaries: (a) is duly organized, validly existing
and in good standing under the laws of the jurisdiction of its organization or
formation except to the extent, in the case of any Subsidiary, that any such
failure of such Subsidiary to be in good standing would not reasonably be
expected to have a Material Adverse Effect; (b) has the power and authority and
all material governmental licenses, authorizations, consents and approvals to
execute, deliver, and perform its obligations under the Loan Documents and,
except to the extent that any failure to have any thereof could not reasonably
be expected to have a Material Adverse Effect, to own its assets and carry on
its business; (c) is duly qualified as a foreign corporation and is licensed and
in good standing under the laws of each jurisdiction where its ownership, lease
or operation of property or the conduct of its business requires such
qualification or license, except where failure to do so would not reasonably be
expected to have a Material Adverse Effect; and (d) is in compliance in all
material respects with all Requirements of Law, except to the extent that the
failure to be in compliance could not reasonably be expected to have a Material
Adverse Effect.

     

    
      
        

      

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    6.02           Corporate
Authorization; No Contravention.  The
execution, delivery and performance by each Loan Party of this Agreement and
each other Loan Document to which such Person is a party, have been duly
authorized by all necessary organizational action, and do not and will not: (a)
contravene the terms of any of that Person’s Organization Documents; (b)
conflict with or result in any breach or contravention of, or the creation of
any Lien under, any document evidencing any Contractual Obligation to which such
Person is a party that would be prior to the Liens granted to the Administrative
Agent for the benefit of the Lenders or otherwise that would constitute a
Material Adverse Effect or, except to the extent that any such conflict, breach
or contravention would not reasonably be expected to have a Material Adverse
Effect, any order, injunction, writ or decree of any Governmental Authority to
which such Person or its property is subject; or (c) violate any Requirement of
Law, that would constitute a Material Adverse Effect, including, without
limitation, any California Requirement of Law promulgated with respect to
preparedness and damage prevention associated with earthquakes.

     

    6.03           Governmental
Authorization.  No
approval, consent, exemption, authorization, or other action by, or notice to,
or filing with, any Governmental Authority is necessary or required in
connection with the execution, delivery or performance by, or enforcement
against, any Loan Party of this Agreement or any other Loan Document to which it
is a party, except for filings necessary to obtain and maintain perfection of
Liens; routine filings related to the Loan Parties and the operation of their
business; and such filings as may be necessary in connection with Lenders’
exercise of its remedies hereunder.

     

    6.04           Binding
Effect.  This
Agreement and each other Loan Document to which any Loan Party is a party
constitute the legal, valid and binding obligations of such Person to the extent
it is a party thereto, enforceable against such Person in accordance with their
respective terms, subject to applicable bankruptcy, insolvency, or similar laws
affecting creditors’ rights generally and general equitable
principles.

     

    6.05           Litigation.  There are no
actions, suits, proceedings, claims or disputes pending, or to the knowledge of
the Loan Parties, threatened or contemplated, at law, in equity, in arbitration
or before any Governmental Authority, against any Loan Party or any of its
subsidiaries, or any of their respective Properties which: (a) purport to affect
or pertain to this Agreement or any other Loan Document, or any of the
transactions contemplated hereby or thereby; or (b) either individually or in
the aggregate could reasonably be expected to have a Material Adverse Effect. To
the knowledge of each Loan Party, no injunction, writ, temporary restraining
order or any order of any nature has been issued by any court or other
Governmental Authority purporting to enjoin or restrain the execution, delivery
or performance of this Agreement or any other Loan Document, or directing that
the transactions provided for herein or therein not be consummated as herein or
therein provided.

     

    6.06           No
Default.

     

    (a)           No
Default or Event of Default exists or would be reasonably expected to result
from the incurring of any Obligations by the Loan Parties.

     

    
      
        

      

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    (b)           No
Loan Party or any Restricted Subsidiary or any Unrestricted Entity is in default
under or with respect to any Contractual Obligation in any respect which,
individually or together with all such defaults, would reasonably be expected to
have a Material Adverse Effect, or that would create an Event of Default under
Section
9.01(e).  Each Loan Party and its subsidiaries is in compliance
with all requirements of any Governmental Authority applicable to it or its
Property and all agreements and other instruments binding upon it or its
Property, and possesses all licenses, permits, franchises, exemptions, approvals
and other authorizations granted by Governmental Authorities necessary for the
ownership of its Property and the present conduct of its business, except in
each case where the failure to do so, individually or in the aggregate, could
not reasonably be expected to result in a Material Adverse Effect.

     

    6.07           ERISA
Compliance.  Except
as specifically disclosed in Schedule
6.07:

     

    (a)           Each
Plan is in compliance in all material respects with the applicable provisions of
ERISA, the Code and other federal or state law.  Each Plan which is
intended to qualify under Section 401(a) of the Code has received a favorable
determination letter from the IRS and to the knowledge of the Company, nothing
has occurred which would cause the loss of such qualification. Each Loan Party
and each ERISA Affiliate has made all required contributions to any Plan subject
to Section 412 of the Code, and no application for a funding waiver or an
extension of any amortization period pursuant to Section 412 of the Code has
been made with respect to any Plan.

     

    (b)           There
are no pending or, to the knowledge of any Loan Party, threatened claims,
actions or lawsuits, or action by any Governmental Authority, with respect to
any Plan which has resulted or could reasonably be expected to result in a
Material Adverse Effect.  There has been no prohibited transaction or
violation of the fiduciary responsibility rules with respect to any Plan which
has resulted or could reasonably be expected to result in a Material Adverse
Effect.

     

    (c)           (i)
No ERISA Event has occurred or is reasonably expected to occur; (ii) no Pension
Plan has any Unfunded Pension Liability; (iii) no Loan Party nor any ERISA
Affiliate has incurred, or reasonably expects to incur, any liability under
Title IV of ERISA with respect to any Pension Plan (other than premiums due and
not delinquent under Section 4007 of ERISA); (iv) no Loan Party nor any ERISA
Affiliate has incurred, or reasonably expects to incur, any liability (and no
event has occurred which, with the giving of notice under Section 4219 of ERISA,
would result in such liability) under Section 4201 or 4243 of ERISA with respect
to a Multiemployer Plan; and (v) no Loan Party nor any ERISA Affiliate has
engaged in a transaction that could be subject to Section 4069 or 4212(c) or
ERISA.

     

    6.08           Margin
Regulations.  The
proceeds of the Loans shall be used solely for the purposes set forth in and
permitted by Section
7.16.  No Loan Party is generally engaged in the business of
purchasing or selling Margin Stock or extending credit for the purpose of
purchasing or carrying Margin Stock.  No proceeds of any Loan shall be
used, whether directly or indirectly, and whether immediately, incidentally or
ultimately, to purchase or carry margin stock (within the meaning of Regulation
U) or to extend credit to others for the purpose of purchasing or carrying
margin stock or to refund indebtedness originally incurred for such
purpose.

     

    6.09           Title
to Properties.  Subject
to Permitted Liens, the Loan Parties and their Subsidiaries shall each have good
and defensible title to all of their respective Oil and Gas Properties evaluated
in the most recently delivered Reserve Report (other than the interests that
have been disposed of in one or more Dispositions permitted hereunder), and
except for such defects in title as would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect, and each Loan Party
and its Subsidiaries shall have good title to all other Oil and Gas Properties
necessary or used in the ordinary conduct of their respective
businesses.  After giving full effect to the Permitted Liens, any Loan
Party or Subsidiary thereof specified as the owner under the most recently
delivered Reserve Report owns the net interests in production attributable to
the Oil and Gas Properties as reflected in the most recently delivered Reserve
Report (other than the interests that have been disposed of in one or more
Dispositions permitted hereunder), and the ownership of such Properties shall
not in any material respect obligate such Loan Party or Subsidiary thereof to
bear the costs and expenses relating to the maintenance, development and
operations of each such Property in an amount in excess of the working interest
of each Property set forth in the most recently delivered Reserve Report that is
not offset by a corresponding proportionate increase in such Loan Party’s or
Subsidiary’s net revenue interest in such Property.  Other than as set
forth on Schedule
6.09, no consents or rights of first refusal exist or remain outstanding
with respect to such Loan Party’s or Subsidiary’s interest in the Mortgaged
Properties assigned to it pursuant to any Acquisition of Oil and Gas Properties
other than Permitted Liens.  Other than as set forth on Schedule
6.09, as of the Effective Date, the property of the Loan Parties and
their Subsidiaries is subject to no Liens, other than Permitted
Liens.

     

    
      
        

      

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    6.10           Oil
and Gas Reserves.  Each
Loan Party and each of its Subsidiaries is and will hereafter be, in all
material respects, the owner of the Oil and Gas that it purports to own from
time to time in and under its Oil and Gas Properties, together with the right to
produce the same.  The Oil and Gas Properties are not subject to any
Lien other than as set forth in the financial statements referred to in Section
6.14, as disclosed to the Lenders in writing prior to the date of this
Agreement and Permitted Liens.  All Oil and Gas have been and will
hereafter be produced, sold and delivered in accordance in all material respects
with all applicable laws and regulations of any Governmental Authority; each of
the Loan Parties and its Subsidiaries has complied in all material respects and
will hereafter use commercially reasonable efforts to comply with all material
terms of each oil, gas and mineral lease and any other agreement comprising its
Oil and Gas Properties; and all such oil, gas and mineral leases and other
agreements have been and will hereafter be maintained in full force and
effect.  Provided, however that nothing in this Section
6.10 shall prevent any Loan Party or its Subsidiaries from (i) abandoning
any well or forfeiting, surrendering, releasing or defaulting under any lease in
the ordinary course of business which is not disadvantageous in any material
respect to the Lenders and which, in the opinion of such Loan Party, is in its
best interest, and such Loan Party and its Subsidiaries is and will hereafter be
in compliance with all obligations hereunder and (ii) making any Disposition
permitted hereunder.  All of the Loan Parties’ and their Subsidiaries’
Operating Agreements and Operating Leases with respect to their Oil and Gas
Properties are and will hereafter be enforceable in all material respects in
accordance with their terms except as such may be modified by applicable
bankruptcy law or an order of a court in equity.

     

    6.11           Initial
Reserve Report.  The
Company has heretofore delivered to the Lenders a true and complete copy of (x)
a report, dated effective as of December 31, 2009, prepared by Netherland,
Sewell and Associates, Inc. (the “Initial Reserve
Report”) relating to an evaluation of the Oil and Gas attributable to the
Oil and Gas Properties described therein.  To the knowledge of the
Company, (a) the assumptions stated or used in the preparation of the Initial
Reserve Report are reasonable, (b) all information furnished by the Company to
Netherland, Sewell and Associates, Inc. (the “Independent
Engineer”) for use in the preparation of the Initial Reserve Report, was
accurate in all material respects, (c) there has been no material adverse change
in the amount of the estimated Oil and Gas shown in the Initial Reserve Report
since the date thereof, except for changes which have occurred as a result of
production in the ordinary course of business, and (d) the Initial Reserve
Report does not omit any material statement or information necessary to cause
the same not to be misleading to the Lenders.

     

    6.12           Gas
Imbalances.  There
are no gas imbalances, take or pay or other prepayments with respect to any of
the Oil and Gas Properties which would require the Loan Parties or their
Subsidiaries to deliver Oil and Gas produced from any of the Oil and Gas
Properties at some future time without then or thereafter receiving full payment
therefor exceeding 300,000 Mcf of gas (on an Mcf equivalent basis) in the
aggregate.

     

    
      
        

      

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    6.13           Taxes.  Unless
specifically disclosed on Schedule
6.13, the Loan Parties and their Subsidiaries have filed all federal tax
returns and reports required to be filed, including any filing extensions
together with payments for any estimated taxes due thereon on or before the time
the extension is due, and have paid all federal taxes, assessments, fees and
other governmental charges levied or imposed upon them or their properties,
income or assets otherwise due and payable, except those which are being
contested in good faith by appropriate proceedings and for which adequate
reserves have been provided in accordance with GAAP.  The Loan Parties
and their Subsidiaries have filed all material state and other non-federal tax
returns and reports required to be filed, and have paid all material state and
other non-federal taxes, assessments, fees and other governmental charges levied
or imposed upon them or their properties, income or assets prior to delinquency
thereof, except those which are being contested in good faith by appropriate
proceedings and for which adequate reserves have been provided in accordance
with GAAP.  To the knowledge of the Loan Parties, there is no proposed
tax assessment against any Loan Party or any of its subsidiaries that would, if
made, reasonably be expected to have a Material Adverse Effect.

     

    6.14           Financial
Condition.

     

    (a)           The
audited consolidated balance sheet of the Company and its Consolidated
Subsidiaries for the fiscal year ended December 31, 2009 (i) were prepared in
accordance with GAAP consistently applied throughout the period covered thereby,
except as otherwise expressly noted therein; (ii) fairly present the financial
condition of the Company and its Consolidated Subsidiaries as of the date
thereof and their results of operations for the period covered thereby in
accordance with GAAP consistently applied throughout the period covered thereby,
except as otherwise expressly noted therein; and (iii) show all material
indebtedness and other liabilities, direct or contingent, of the Company and its
Consolidated Subsidiaries as of the date thereof, including liabilities for
taxes, material commitments and Indebtedness.

     

    (b)           The
unaudited consolidated balance sheets of the Company and its Consolidated
Subsidiaries dated March 31, 2010, and the related consolidated statements
of income or operations, shareholders’ equity and cash flows for the fiscal
quarter ended on that date (i) were prepared in accordance with GAAP
consistently applied throughout the period covered thereby, except as otherwise
expressly noted therein, and (ii) fairly present the financial condition of the
Company and its Consolidated Subsidiaries as of the date thereof and their
results of operations for the period covered thereby, subject, in the case of
clauses (i) and (ii), to the absence of footnotes and to normal year-end audit
adjustments.

     

    (c)           Since
December 31, 2009, (i) there has been no event, development or circumstance that
has had or could reasonably be expected to have a Material Adverse Effect, and
(ii) the business of Parent and the other Loan Parties have been conducted only
in the ordinary course consistent with past business practices.

     

    6.15           Environmental
Matters.  Except
as described on Schedule
6.15 hereto or that, either individually or in the aggregate, could not
be reasonably expected to have a Material Adverse Effect (or with respect to (c)
and (d) below, where the failure, either individually or in the aggregate, to
take such actions could not be reasonably expected to have a Material Adverse
Effect):

     

    (a)           neither
any Property of any Loan Party or any of its Subsidiaries, nor the operations
conducted thereon, violate Environmental Laws.

     

    
      
        

      

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    (b)           no
Property of any Loan Party or any of its Subsidiaries, nor the operations
currently conducted thereon by any Loan Party, or, to the knowledge of such Loan
Party, no operations conducted thereon by any prior owner or operator of such
Property, are in violation of or subject to any existing, or to the knowledge of
such Loan Party, pending or threatened action, suit, investigation, inquiry or
proceeding by or before any Governmental Authority under Environmental
Laws.

     

    (c)           all
notices, permits, licenses, exemptions, and approvals, if any, required to be
obtained or filed under any Environmental Law in connection with the operation
or use of any and all Property by each Loan Party, including, without
limitation, any treatment, storage, disposal or Release of any Hazardous
Materials into the environment, have been duly obtained or filed or requested,
and each Loan Party and its Subsidiaries is in compliance with the material
terms and conditions of all such notices, permits, licenses, exemptions and
approvals.

     

    (d)           Hazardous
Materials, if any, generated by the Loan Parties or any of their Subsidiaries at
any and all Property of any such Subsidiary have in the past been transported,
treated and disposed of in compliance with Environmental Laws then in effect,
and, to the knowledge of such Loan Party, transport carriers and treatment and
disposal facilities known by such Loan Party to have been used by it are not the
subject of any existing action, investigation or inquiry by any Governmental
Authority under any Environmental Laws.

     

    (e)           no
Hazardous Materials have been disposed of or otherwise Released by any Loan
Party or any Subsidiary thereof on or to any Property of such Loan Party or
Subsidiary except in compliance with Environmental Laws.

     

    (f)           no
Loan Party has any known pending assessment, investigation, monitoring, removal
or remedial obligations under applicable Environmental Laws in connection with
any Release or threatened Release of any Hazardous Materials into the
environment by any Loan Party or any Subsidiary thereof.

     

    6.16           Regulated
Entities.  Neither
Parent nor any of its Subsidiaries, is an “investment company” or is a
company “controlled by” an “investment company” within
the meaning of the Investment Company Act of 1940. None of the Loan Parties, or
any Person controlling the Company or the Guarantors, is subject to regulation
under the Federal Power Act, the Interstate Commerce Act, any state public
utilities code, or any other Federal or state statute or regulation limiting its
ability to incur Indebtedness.

     

    6.17           No
Burdensome Restrictions.  No
Loan Party or any of its Subsidiaries is a party to or bound by any Contractual
Obligation, or subject to any restriction in any Organization Document, or any
Requirement of Law, which would reasonably be expected to have a Material
Adverse Effect.

     

    6.18           Copyrights,
Patents, Trademarks and Licenses, Etc.  Except
to the extent that any failure, individually or in the aggregate, would not
reasonably be expected to have a Material Adverse Effect, each Loan Party and
each of its Subsidiaries owns or is licensed or otherwise has the right to use
all of the material patents, trademarks, service marks, trade names, copyrights,
contractual franchises, authorizations and other rights that are reasonably
necessary for the operation of its business, without material conflict with the
rights of any other Person.  To the knowledge of any Loan Party, no
slogan or other advertising device, product, process, method, substance, part or
other material now employed, or now contemplated to be employed, by any Loan
Party or any Subsidiary thereof infringes in a material respect upon any rights
held by any other Person.  No claim or litigation regarding any of the
foregoing is pending or threatened, and no patent, invention, device,
application, principle or any statute, law, rule, regulation, standard or code
is pending or, to the knowledge of any Loan Party, proposed, which, in either
case, could reasonably be expected to have a Material Adverse
Effect.

     

    
      
        

      

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    6.19           Subsidiaries
and Other Equity Interests.  No
Loan Party has any Subsidiary, Unrestricted Entity or other equity investment
other than those specifically disclosed in Schedule
6.19 hereto.  The Company owns the percentage interest of all
issued and outstanding Equity in each Subsidiary, Unrestricted Entity or other
material equity investment described on Schedule
6.19. Parent owns one hundred percent (100%) of the issued and
outstanding equity in the Company. The Company may update and replace Schedule 6.19
from time to time to reflect changes resulting from transactions or other
events permitted hereunder.

     

    6.20           Insurance.  The
Properties of each Loan Party and its Subsidiaries is insured with financially
sound and reputable insurance companies not Affiliates of the Company, in such
amounts, with such deductibles and covering such risks as are customarily
carried by companies engaged in similar businesses and owning similar properties
in localities where the Company or such Loan Party or Subsidiary
operates.

     

    6.21           Derivative
Contracts.  As
of the date hereof Schedule
6.21 sets forth, a true and complete list of all Derivative Contracts of
the Loan Parties and their Subsidiaries in effect as of the Effective Date, the
material terms thereof (including the type, term, effective date, termination
date and notional amounts or volumes), the net mark-to-market value thereof, all
credit support agreements relating thereto (including any margin required or
supplied) and the counterparty to each such agreement.

     

    6.22           Full
Disclosure.  None
of the representations or warranties made by any Loan Party in the Loan
Documents as of the date such representations and warranties are made or deemed
made, and none of the statements contained in any exhibit, report, written
statement or certificate (other than any financial projections, forecasts or
estimates) furnished by or on behalf of any Loan Party in connection with the
Loan Documents, taken as whole, contains any untrue statement of a material fact
known to any Loan Party, or omits any material fact known to any Loan Party,
required to be stated therein or necessary to make the statements made therein,
in light of the circumstances under which they are made, not misleading as of
the time when made or delivered.

     

    6.23           Solvency.

     

    (a)           Each
of the Parent and the Company is Solvent.

     

    (b)           (i)
The fair value of all of the property of the Loan Parties, taken as a whole, is
greater than the amount of their liabilities (including disputed, contingent and
unliquidated liabilities) as such value is established and liabilities evaluated
for purposes of Section 101(32) of the Bankruptcy Code; (ii) the present fair
salable value of all of the property of the Loan Parties, taken as a whole, is
not less than the amount that will be required to pay the probable liability of
such Person on its debts as they become absolute and matured; (iii) no Loan
Party intends to, and believes that it will not, incur debts or liabilities
beyond such Person’s ability to pay as such debts and liabilities mature; and
(iv) no Loan Party is engaged in business or a transaction, or is about to
engage in business or a transaction, for which such Person’s property would
constitute unreasonably small capital.

     

    ARTICLE
VII.

     

    AFFIRMATIVE
COVENANTS

     

    So long
as the Issuing Lender or any Lender shall have any Commitment hereunder, or any
Loan, Letter of Credit or other Obligation (other than Obligations in respect of
(i) indemnification, expense reimbursement, tax gross-up or yield protection for
which no claim has been made or (ii) Lender Derivative Contracts) shall remain
unpaid or unsatisfied, or any Letter of Credit remains outstanding:

     

    
      
        

      

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    7.01           Financial
Statements.  Each
of the Loan Parties shall maintain, for itself and each of its Consolidated
Subsidiaries, on a consolidated basis, a system of accounting established and
administered in accordance with GAAP and deliver, or cause to be delivered, to
Administrative Agent, with sufficient copies for each Lender:

     

    (a)           no
later than fifteen (15) days following the date required by applicable SEC rules
(without giving effect to any extensions available thereunder) for the filing of
such financial statements:

     

    (i)           the
audited consolidated balance sheet and related statements of income, partners
equity and cash flows of Parent as of the end of and for such year, setting
forth in each case in comparative form the figures for the previous fiscal year,
all (A) reported on by a nationally recognized independent public accounting
firm (the “Independent
Auditor”) (without a “going concern” or like
qualification or exception and without any qualification or exception as to the
scope of such audit) to the effect that such consolidated financial statements
present fairly in all material respects the financial condition, results of
operations and cash flows of Parent and its Consolidated Subsidiaries on a
consolidated basis in accordance with GAAP consistently applied, and (B)
certified by a Responsible Officer as fairly presenting in all material
respects, the financial condition, results of operations and cash flows of
Parent and its Consolidated Subsidiaries on a consolidated basis in accordance
with GAAP consistently applied;

     

    (ii)          unaudited
annual consolidating balance sheet and consolidating statement of income for
Parent and its Consolidated Subsidiaries as of the end of such year, certified
by a Responsible Officer as fairly presenting in all material respects, the
financial condition, results of operations of Parent and its Consolidated
Subsidiaries on a consolidated basis in accordance with GAAP consistently
applied; and

     

    (iii)         the
unaudited consolidated balance sheet and related statements of income, partners
equity and cash flows of the Company as of the end of and for such year, setting
forth in each case in comparative form the figures for the previous final year,
and unaudited consolidating balance sheets and statements of income, all
certified by a Responsible Officer as fairly presenting in all material
respects, the financial condition, results of operations and cash flows of the
Company and its Consolidated Subsidiaries on a consolidated basis in accordance
with GAAP consistently applied, subject to the absence of
footnotes.

     

    (b)           fifteen
(15) days following the date required by applicable SEC rules (without giving
effect to any extensions available thereunder) for the filing of such financial
statements after the end of each of the first three fiscal quarters of each
fiscal year of Parent:

     

    (i)           the
unaudited consolidated balance sheet and related statements of income, partners
equity and cash flows of Parent 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 fairly presenting in all material
respects, the financial condition, results of operations and cash flows of
Parent and its Consolidated Subsidiaries on a consolidated basis in accordance
with GAAP consistently applied, subject to the absence of footnotes;
and

     

    
      
        

      

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    (ii)          the
unaudited consolidated balance sheet and related statements of income, partners
equity and cash flows of the Company 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 fairly presenting in all
material respects, the financial condition, results of operations and cash flows
of the Company and its Consolidated Subsidiaries on a consolidated basis in
accordance with GAAP consistently applied, subject to the absence of
footnotes.

     

    7.02           Certificates;
Other Production and Reserve Information.  The
Company shall furnish to the Administrative Agent, with sufficient copies for
each Lender:

     

    (a)           As
soon as available, but not later than 45 days after the close of each fiscal
quarter of Parent (including the fourth quarter), a Quarterly Status Report
covering each of the three months during such fiscal quarter;

     

    (b)           Concurrently
with any delivery of financial statements under Sections
7.01(a) and 7.01(b), a
certificate of a Responsible Officer, in form and substance reasonably
satisfactory to the Administrative Agent, setting forth as of the last Business
Day of such fiscal quarter or fiscal year, a true and complete list of all
Derivative Contracts of each Loan Party, the material terms thereof (including
the type, term, effective date, termination date and notional amounts or
volumes), the net mark-to-market value therefor, any new credit support
agreements relating thereto not listed on Schedule
8.05, any margin required or supplied under any credit support document,
and the counterparty to each such agreement;

     

    (c)           Concurrently
with the delivery of the financial statements referred to in Sections 7.01(a)
and 7.01(b), a Pricing Grid Certificate executed by a Responsible Officer
of Parent;

     

    (d)           Concurrently
with the delivery of the statements and reports referred to in Sections
7.01(a) and 7.01(b), a
Compliance Certificate executed by a Responsible Officer of Parent;

     

    (e)           Annually
commencing March 1, 2011, dated as of January 1st of such
year, a Reserve Report prepared by the Independent Engineer or other independent
petroleum engineer reasonably acceptable to Administrative Agent and the
Company, and annually, commencing September 1, 2010, a Reserve Report prepared
by personnel of the Company and certified by a Responsible Officer of the
Company as true and correct in all material respects. Each Reserve Report shall
be in form and substance reasonably satisfactory to the Lenders. With the
delivery of each Reserve Report, the Company shall provide to the Administrative
Agent and the Lenders a certificate from a Responsible Officer certifying that
in all material respects: (i) the information contained in the Reserve Report
and any other information delivered in connection therewith is true and correct
in all material respects, (ii) the Loan Parties own (and in the case of Oil and
Gas Properties owned by BEP I, BEP I owns) good and defensible title to the Oil
and Gas Properties evaluated in such Reserve Report, and such Properties are
free of all Liens except for Liens permitted by Section 8.01,
(iii) except as set forth on an exhibit to the certificate, on a net basis there
are no gas imbalances, take or pay or other prepayments in excess of the volume
specified in Section
6.12 with respect to their Oil and Gas Properties evaluated in such
Reserve Report that would require any Loan Party to deliver (or, in the case of
Oil and Gas Properties owned by BEP I, would require BEP I to deliver) Oil and
Gas either generally or produced from such Oil and Gas Properties at some future
time without then or thereafter receiving full payment therefor, (iv) none of
their proved Oil and Gas Properties have been sold since the date of the last
Borrowing Base determination except as set forth on an exhibit to the
certificate, which certificate shall list all of its proved Oil and Gas
Properties sold and in such detail as reasonably required by the Administrative
Agent, (v) attached to the certificate is a list of all marketing agreements
entered into subsequent to the most recently delivered Reserve Report and (vi)
attached thereto is a schedule of the Oil and Gas Properties evaluated by such
Reserve Report that are Mortgaged Properties and demonstrating the percentage of
the present value that such Mortgaged Properties represent;

     

    
      
        

      

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    (f)           [Intentionally
Omitted];

     

    (g)    
      Promptly after the furnishing thereof,
copies of any financial statement, report or notice furnished to or by any
Person pursuant to the terms of any preferred stock designation, indenture, loan
or credit or other similar agreement, other than this Agreement and not
otherwise required to be furnished to the Lenders pursuant to any other
provision of this Section
7.02;

     

    (h)          [Intentionally
Omitted];

     

    (i)    
       Concurrently with the delivery of any
Reserve Report to the Administrative Agent pursuant to Section
7.02(e), or after an Event of Default, upon request, a list of all
Persons purchasing Oil and Gas from any of the Loan Parties or BEP
I;

     

    (j)           Prompt
written notice, and in any event within three (3) Business Days, of the
occurrence of any Casualty Event;

     

    (k)           Prompt
written notice (and in any event within thirty (30) days prior thereto) of any
change (i) in any Loan Party’s organizational name or in any trade name used to
identify such Person in the conduct of its business or in the ownership of its
Properties, (ii) in the location of any Loan Party’s chief executive office or
principal place of business, (iii) in any Loan Party’s identity or
organizational structure or in the jurisdiction in which such Person is
incorporated or formed, (iv) in any Loan Party’s jurisdiction of organization or
such Person’s organizational identification number in such jurisdiction of
organization, and (v) in any Loan Party’s federal taxpayer identification
number, if any;

     

    (l)           Promptly
upon the request of the Administrative Agent, such copies of all geological,
engineering and related data contained in any of Loan Parties’ files or readily
accessible to the Loan Party relating to the Oil and Gas Properties as may
reasonably be requested;

     

    (m)          On
request by the Administrative Agent, based upon the Administrative Agent’s or
Lenders’ good faith belief that any Loan Party’s title to the Mortgaged
Properties (or BEP I’s title to Oil and Gas Properties owned by it) or the
Administrative Agent’s lien on the Loan Parties’ properties is subject to claims
of third parties, or if required by regulations to which the Administrative
Agent or any of the Lenders is subject, title and mortgage lien evidence
reasonably satisfactory to the Administrative Agent covering such Mortgaged
Property as may be designated by the Administrative Agent, covering such Loan
Party’s title thereto (or BEP I’s title to Oil and Gas Properties owned by it)
and evidencing that the Obligations are secured by liens and security interests
as provided in this Agreement and the Security Documents;

     

    (n)           As
soon as available, and in any event within 90 days after the end of each fiscal
year, a business and financial plan for Parent (in form reasonably satisfactory
to the Administrative Agent), prepared by a Responsible Officer, setting forth
for the current fiscal year, quarterly financial projections and budgets for
Parent, and for three fiscal years thereafter yearly financial projections and
budgets; and

     

    (o)           Promptly,
such additional information regarding the business, financial or corporate
affairs of the Loan Parties as the Administrative Agent, at the reasonable
request of any Lender, may from time to time request.

     

    
      
        

      

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    Documents
required to be delivered pursuant to Sections 7.01 and
7.02 (other than Section
7.02(d)) may be delivered electronically and if so delivered, shall be
deemed to have been delivered on the date (i) on which the Company posts such
documents, or provides a link thereto on the Company's website on the Internet
or (ii) on which such documents are posted on the Company'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, however, that (x) the
Company shall deliver paper copies of such documents to the Administrative Agent
or any Lender that requests the Company to deliver such paper copies until a
written request to cease delivering paper copies is given by the Administrative
Agent or such Lender and (y) the Company 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 Company shall be required to
provide paper copies of the compliance certificates required by Section
7.02(d) to the Administrative Agent.

     

    7.03           Notices.  The
Company shall promptly notify the Administrative Agent:

     

    (a)           of
the occurrence of any Default,  Event of Default or BEP I Default, or
any event or circumstance that would reasonably be expected to become a Default,
Event of Default or BEP I Default of which a Responsible Officer of the Company
has actual knowledge;

     

    (b)          of
any matter that has resulted or would reasonably be expected to result in a
Material Adverse Effect, including (i) breach or non-performance of, or any
default under, a Contractual Obligation of Parent, the Company or any subsidiary
thereof; (ii) any dispute, litigation, investigation, proceeding or suspension
between Parent, the Company or any subsidiary thereof and any Governmental
Authority; (iii) the commencement of, or any material development in, any
litigation, proposed legislation, ordinance or regulation of a Governmental
Authority, or proceeding affecting Parent, the Company or any subsidiary
thereof; including pursuant to any applicable Environmental Laws; or (iv)
revocation, cancellation or failure to renew any license, permit or franchise,
where such breach, non-performance, default, dispute, litigation, investigation,
proceeding, suspension, proposed legislation, ordinance or regulation,
revocation, failure or loss could reasonably be expected to have a Material
Adverse Effect;

     

    (c)          of
any material change in accounting policies or financial reporting practices by
Parent, the Company or any Consolidated Subsidiary; or

     

    (d)          of
the formation or acquisition of any Restricted Subsidiary or Unrestricted
Entity.

     

    Each
notice under this Section
7.03 shall be accompanied by a written statement by a Responsible Officer
setting forth details of the occurrence referred to therein, and stating what
action such Loan Party proposes to take with respect thereto and at what
time.  Each notice under Section
7.03(a) shall describe with particularity any and all clauses or
provisions of this Agreement or other Loan Document that have been (or
foreseeably will be) breached or violated.

     

    7.04           Preservation
of Company Existence, Etc.  Each
Loan Party shall, and shall cause its Subsidiaries to:

     

    (a)           preserve
and maintain in full force and effect its legal existence, and, except to the
extent that the failure to do so would not reasonably be expected to have a
Material Adverse Effect, maintain its good standing under the laws of its state
or jurisdiction of formation, provided however, that  (i) the
liquidation, dissolution or wind-up of any Subsidiary shall be permitted either
to the extent assets of such Subsidiary are not transferred to any party other
than the Company or another Subsidiary, and (ii) the merger or consolidation of
any Subsidiary shall be permitted to the extent set forth in Section
8.03;

     

    
      
        

      

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    (b)          preserve
and maintain in full force and effect all governmental rights, privileges,
qualifications, permits, licenses and franchises necessary or desirable in the
normal conduct of its business except where the failure to do so would not
reasonably be expected to have a Material Adverse Effect;

     

    (c)           use
reasonable efforts, in the ordinary course of business, to preserve its business
organization and goodwill except where the failure to do so would not reasonably
be expected to have a Material Adverse Effect; and

     

    (d)           preserve
or renew all of its registered patents, trademarks, trade names and service
marks, the non-preservation of which could reasonably be expected to have a
Material Adverse Effect.

     

    7.05           Maintenance
of Property.  Each
Loan Party shall, and shall cause its Subsidiaries to, maintain and preserve all
its Property which is used or useful in its business in good working order and
condition, ordinary wear and tear excepted and to use the standard of care
typical in the industry in the operation and maintenance of its facilities
except where the failure to do so would not reasonably be expected to have a
Material Adverse Effect provided, however, that nothing in this Section
7.05 shall prevent such Loan Party or its Subsidiaries from abandoning
any well or forfeiting, surrendering, releasing or defaulting under any lease in
the ordinary course of business which is not materially disadvantageous in any
way to the Lenders and which, in its opinion, is in the best interest of such
Loan Party, and each such Loan Party is and will hereafter be in compliance with
all obligations hereunder.

     

    7.06           Title
Information.  On or before the delivery to the
Administrative Agent and the Lenders of each Reserve Report required by Section
7.02(e), the Company will deliver title information in form and substance
acceptable to the Administrative Agent covering enough of the Oil and Gas
Properties evaluated by such Reserve Report that were not included in the
immediately preceding Reserve Report, so that the Administrative Agent shall
have received together with title information previously delivered to the
Administrative Agent, satisfactory title information on at least 80% of the
total net present value (determined by a discount factor of 10%) of the proved
Oil and Gas Properties evaluated by such Reserve Report.

     

    7.07           Additional Collateral. In connection with each
redetermination of the Borrowing Base, the Company shall review the Reserve
Report and the list of current Mortgaged Properties (as described in Section
7.02(e))
to ascertain whether the Mortgaged Properties represent at least 80% of the
total net present value (determined by a discount factor of 10%) of the Oil and
Gas Properties evaluated in the most recently completed Reserve Report after
giving effect to exploration and production activities, acquisitions,
dispositions and production.  In the event that the Mortgaged
Properties do not represent at least 80% of such total net present value, then
the Company shall, and shall cause each Loan Party to, grant, within thirty (30)
days of delivery of the certificate required under Section
7.02(e), to the Administrative Agent or its designee as security for the
Obligations a first-priority Lien interest on additional Oil and Gas Properties
not already subject to a Lien of the Security Documents such that after giving
effect thereto, the Mortgaged Properties will represent at least 80% of such
total net present value.  All such Liens will be created and perfected
by and in accordance with the provisions of deeds of trust, security agreements
and financing statements or other Security Documents, all in form and substance
reasonably satisfactory to the Administrative Agent or its designee and in
sufficient executed (and acknowledged where necessary or appropriate)
counterparts for recording purposes.

     

    
      
        

      

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    7.08           Insurance.  Each
Loan Party shall, and shall cause its Subsidiaries to, maintain, with
financially sound and reputable independent insurers, insurance with respect to
its properties and business against loss or damage of the kinds customarily
insured against by Persons engaged in the same or similar business, of such
types and in such amounts as are customarily carried under similar circumstances
by such other Persons except where the failure to do so would not reasonably be
expected to have a Material Adverse Effect. The loss payable clauses or
provisions in said insurance policy or policies insuring any of the Collateral
for the Loan shall be endorsed in favor of and made payable to the
Administrative Agent as its interests may appear and such policies shall name
the Administrative Agent and the Lenders as “additional insured” and
provide that the insurer will give at least 30 days prior notice of any
cancellation to the Administrative Agent.

     

    7.09           Payment
of Obligations.  Each
Loan Party shall, and shall cause its Subsidiaries to, pay and discharge prior
to delinquency, all their respective obligations and liabilities, including: (a)
all tax liabilities, assessments and governmental charges or levies upon it or
its properties or assets, unless the same are being contested in good faith by
appropriate proceedings and adequate reserves in accordance with GAAP are being
maintained by such Loan Party or its Subsidiary; (b) all lawful claims which, if
unpaid, would by law become a Lien upon its Property; and (c) all Indebtedness,
as and when due and payable, but subject to any subordination provisions
contained in any instrument or agreement evidencing such Indebtedness; except in
each of (a), (b) and (c), where the failure to do so would not reasonably be
expected to have a Material Adverse Effect.

     

    7.10           Compliance
with Laws.  Each
Loan Party shall, and shall cause its Subsidiaries to, comply in all material
respects with all Requirements of Law of any Governmental Authority having
jurisdiction over it or its business (including Environmental Laws, the Federal
Fair Labor Standards Act and any California Requirement of Law promulgated with
respect to earthquakes), except (a) such as may be contested in good faith or as
to which a bona fide dispute may exist or (b) where the failure to do so would
not reasonably be expected to have a Material Adverse Effect.

     

    7.11           Compliance
with ERISA.  Each
Loan Party shall, and shall cause each of its ERISA Affiliates to: (a) maintain
each Plan in compliance in all material respects with the applicable provisions
of ERISA, the Code and other federal or state law; (b) cause each Plan which is
qualified under Section 401(a) of the Code to maintain such qualification; and
(c) make all required contributions to any Plan subject to Section 412 of the
Code.

     

    7.12           Inspection
of Property and Books and Records.  Each
Loan Party shall, and shall cause its Subsidiaries to, maintain proper books of
record and account, in which full, true and correct entries in conformity with
GAAP consistently applied shall be made of all financial transactions and
matters involving the assets and business of such Loan Party or its Subsidiary,
as applicable. Each Loan Party shall, and shall cause its Subsidiaries to,
permit, representatives and independent contractors of the Administrative Agent
or any Lender to visit and inspect any of their respective properties, to
examine their respective company, financial and operating records, and make
copies thereof or abstracts therefrom, and to discuss their respective affairs,
finances and accounts with their respective managers, directors, officers, and
independent public accountants, all at the expense of the Loan Parties and at
such reasonable times during normal business hours and as often as may be
reasonably desired, upon reasonable advance notice to such Loan Party; provided, however, when an
Event of Default exists the Administrative Agent or any Lender may do any of the
foregoing at the expense of the Company at any time during normal business hours
and without advance notice.

     

    
      
        

      

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    7.13           Environmental
Laws.

     

    (a)           Each
Loan Party shall, and shall cause its Subsidiaries to, comply with all
applicable Environmental Laws and maintain all environmental, health and safety
permits, licenses and authorizations necessary for its operations and will
maintain such in full force and effect except where such noncompliance or the
failure to maintain such permits, licenses and authorizations would not
reasonably be expected to have a Material Adverse Effect.  Each Loan
Party shall, and shall cause its Subsidiaries to, promptly commence and
diligently prosecute to completion, any assessment, evaluation, investigation,
monitoring, containment, cleanup, removal, repair, restoration, remediation or
other remedial obligations (collectively, the “Remedial
Work”) in the event any Remedial Work is required under applicable
Environmental Laws because of or in connection with the actual or suspected
past, present or future Release of any Hazardous Materials on, under, about or
from any of the Loan Parties’ Properties, which failure to commence and
diligently prosecute to completion could reasonably be expected to have a
Material Adverse Effect.

     

    (b)           Each
Loan Party shall, and shall cause its Subsidiaries to, establish and implement,
such procedures as may be reasonably necessary to continuously determine and
assure that the Loan Party’s obligations under this Section
7.13 are timely and fully satisfied, which failure to establish and
implement could reasonably be expected to have a Material Adverse
Effect

     

    (c)           Each
Loan Party will, and will cause its Subsidiaries to, promptly furnish to the
Administrative Agent all written notices of violation, orders, claims,
citations, complaints, penalty assessments, suits or other proceedings received
by such Loan Party or Subsidiary, or of which it has notice, pending or
threatened against such Loan Party or any of its Subsidiaries, by any
Governmental Authority with respect to any alleged violation of or
non-compliance with any Environmental Laws or any permits, licenses or
authorizations related to Environmental Laws in connection with its ownership or
use of its Properties or the operation of its business, except where any such
alleged violations or incidents of non-compliance would not, individually or in
the aggregate, result in a penalty, assessment, fine or other cost or liability
exceeding $1,000,000.

     

    (d)           Each
Loan Party will, and will cause its Subsidiaries to, promptly furnish to the
Administrative Agent all requests for information, notices of claim, demand
letters, and other notifications, received by such Loan Party or Subsidiary in
connection with its ownership or use of its Properties or the conduct of its
business, relating to potential responsibility with respect to any investigation
or clean-up of Hazardous Materials at any location, except where any such
alleged responsibility would not, individually or in the aggregate, result in a
penalty, assessment, fine or other cost or liability exceeding
$1,000,000.

     

    7.14           Pledge
of Equity in New Subsidiary.  If,
at any time after the date of this Agreement, any new Subsidiary (other than
BreitBurn GP LLC, for so long as it is the general partner of the Parent) is
acquired or created, then the applicable Loan Party shall pledge all of the
Equity of such Subsidiary and deliver such documentation as the Administrative
Agent requires in connection with such pledge, including original stock or other
ownership certificates evidencing such Equity, together with undated stock
powers for each such certificate duly executed in blank and such additional
closing documents, certificates and legal opinions as the Administrative Agent
shall reasonably require.

     

    7.15           New
Subsidiary Guarantors.  If,
at any time after the date of this Agreement, there exists any subsidiary of a
Loan Party (other than BEP I and the Unrestricted Entities) that is not a
Guarantor hereunder, or if BEP I or any Unrestricted Entity becomes a Wholly
Owned Subsidiary of a Loan Party, then such Loan Party shall cause BEP I or each
such Subsidiary, as applicable, to execute and deliver to the Administrative
Agent a Guaranty or supplement to existing Guaranty, and a Security Agreement or
supplement to existing Security Agreement, and other documents and opinions as
required pursuant to Sections 4.02
and 4.05.

     

    7.16           Use
of Proceeds.  The
Company shall use the proceeds of the Loans (a) to refinance the Loans
outstanding on the Effective Date under the Existing Credit Agreement, (b) to
reimburse the Issuing Lender for drawings made under Letters of Credit, (c) for
working capital purposes (including capital expenditures made for the
exploration and development of Oil and Gas Properties) of the Company and its
Subsidiaries, (d) for general company purposes of the Company and its
Subsidiaries, and (e) to make Loans and Investments permitted under Section
8.04 and Restricted Payments permitted under Section
8.09.  The Company shall use Letters of Credit as support for
Derivative Contracts and for other general company purposes of the Company and
its Subsidiaries.

     

    
      
        

      

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    7.17           Operating
Accounts.  The
Loan Parties and their Subsidiaries shall maintain with Administrative Agent all
primary operating and depository accounts.

     

    7.18           Phase
I Reports.  As
soon as available, and in any case within fifteen (15) days prior to acquiring
any Oil and Gas Properties directly or indirectly through a Subsidiary each Loan
Party shall deliver to the Lenders a Phase I Report covering such Oil and Gas
Properties to be acquired in form and substance reasonably satisfactory to the
Administrative Agent.

     

    7.19           Further
Assurances.

     

    (a)           Each
Loan Party will promptly cure any defects in the creation and issuance of the
Notes and the execution and delivery of this Agreement, the Security Documents
or any other instruments referred to or mentioned herein or
therein.  The Company at its expense will promptly do all acts and
things, and will execute and file or record, all instruments reasonably
requested by the Administrative Agent, to establish, perfect, maintain and
continue the perfected security interest of the Administrative Agent in or the
Lien of the Administrative Agent on the Mortgaged Properties.  Upon
request by the Administrative Agent, each Loan Party shall promptly execute such
additional Security Documents covering any new Oil and Gas Properties reflected
on the Quarterly Status Reports or any new Subsidiaries of the Loan
Parties.  The Company will pay the costs and expenses of all filings
and recordings and all searches deemed necessary by the Administrative Agent to
establish and determine the validity and the priority of the Liens created or
intended to be created by the Security Documents; and such Loan Party will
satisfy all other claims and charges which in the reasonable opinion of the
Administrative Agent might prejudice, impair or otherwise affect any of the
Mortgaged Properties or any Liens thereon in favor of the Administrative Agent
for the benefit of the Issuing Lender and the Lenders.

     

    (b)          Each
Loan Party hereby authorizes the Administrative Agent to file one or more
financing or continuation statements, and amendments thereto, relative to all or
any part of the Mortgaged Property without the signature of such Loan Party
where permitted by law. A carbon, photographic or other reproduction of the
Security Documents or any financing statement covering the Mortgaged Property or
any part thereof shall be sufficient as a financing statement where permitted by
law.  The Administrative Agent will promptly send such Loan Party any
financing or continuation statements it files without the signature of such Loan
Party and the Administrative Agent will promptly send the Company the filing or
recordation information with respect thereto.

     

    ARTICLE
VIII.

     

    NEGATIVE
COVENANTS

     

    So long
as any Lender shall have any Commitment hereunder, or any Loan or other
Obligation (other than Obligations in respect of (i) indemnification, expense
reimbursement, tax gross-up or yield protection for which no claim has been
made, or (ii) Lender Derivative Contracts) shall remain unpaid or unsatisfied,
or any Letter of Credit remains outstanding:

     

    
      
        

      

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    8.01           Limitation
on Liens.  Each
Loan Party agrees that it shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, make, create, incur, assume or suffer
to exist any Lien upon or with respect to any part of its property, whether now
owned or hereafter acquired, other than the following (“Permitted
Liens”):

     

    (a)           any
Lien created under any Loan Document;

     

    (b)           Liens
for Taxes, fees, assessments or other governmental charges which are not
delinquent or remain payable without penalty, or to the extent that non-payment
thereof is permitted by Section
7.09;

     

    (c)           carriers’,
warehousemen’s, mechanics’, landlords’, materialmen’s, repairmen’s or other
similar Liens arising in the ordinary course of business (whether by law or by
contract) which are not delinquent or remain payable without penalty or which
are being contested in good faith and by appropriate proceedings, which
proceedings have the effect of preventing the forfeiture or sale of the property
subject thereto;

     

    (d)           Liens
consisting of pledges or deposits required in the ordinary course of business in
connection with workers’ compensation, unemployment insurance and other social
security legislation;

     

    (e)           Liens
on the Property of such Loan Party securing (i) the non-delinquent performance
of bids, trade contracts (other than for borrowed money), and statutory or
regulatory obligations, (ii) contingent obligations on surety, performance and
appeal bonds, and (iii) other non-delinquent obligations of a like nature; in
each case, incurred in the ordinary course of business;

     

    (f)           easements,
rights-of-way, restrictions, defects or other exceptions to title (including,
but not limited to, the contractual nature of the Company’s interest in the Brea
Oil Field, Orange County, California, and the failure of certain Indian Tribes
to act on assignment consents in certain Wyoming properties in connection with
the acquisition by the Company of Properties from Nautilus Resources, LLC and
Phoenix Production Company) and other similar
encumbrances incurred in the ordinary course of business which, in the
aggregate, are not substantial in amount, are not incurred to secure
Indebtedness, and which do not in any case materially detract from the value of
the Property subject thereto or interfere with the ordinary conduct of the
businesses of the Loan Parties or BEP I;

     

    (g)           Liens
arising solely by virtue of any statutory or common law provision relating to
bankers’ liens, rights of set-off or similar rights and remedies as to deposit
accounts maintained with a depository institution; or under any deposit account
agreement entered into in the ordinary course of business; provided that, with
respect to each such deposit account and funds held therein: (i) no such deposit
account or funds constitute a dedicated cash collateral account or cash
collateral or are subject to restrictions against access by the applicable Loan
Party, (ii) the Loan Party maintains (subject to such right of set off) dominion
and control over such account(s) and funds, (iii) no such deposit account or
funds are intended by any Loan Party to provide cash collateral to the
depository institution, and (iv) if the balance in a deposit account exceeds
$100,000, then the following additional provision shall apply: except during
such times as the institution holding such account is a Lender, no such deposit
account or any funds contained therein shall at any time secure any obligations
under Derivative Contracts, other Indebtedness, or any obligations other than
the obligation to pay fees, expenses and other amounts owed to the
account-holding depository institution associated with the maintenance of such
deposit account;

     

    (h)           Oil
and Gas Liens;

     

    (i)     
      judgment Liens securing judgments that do
not constitute Events of Default under Section
9.01(i);

     

    
      
        

      

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    (j)           deposits
of cash or Cash Equivalents in the ordinary course of business not to exceed the
amount of $1,000,000 in the aggregate to secure the performance of leases and
contracts entered into in the ordinary course of business, but only to the
extent securing performance obligations that do not constitute
Indebtedness;

     

    (k)          existing
Liens described on Schedule
8.01;

     

    (l)           Liens
granted to secure payment of Capitalized Lease Obligations and purchase money
Indebtedness of the Loan Parties, so long as such Indebtedness is permitted
under Section
8.05(g), provided that such Liens (i) attach only to the assets acquired
with the proceeds of such Indebtedness and (ii) do not cover any Hydrocarbon
Interests or equity interests in Persons owning direct or indirect interests in
Hydrocarbon Interests);

     

    (m)          Liens
securing reimbursement obligations of the Loan Parties permitted to be incurred
by the Loan Parties pursuant to the terms of this Agreement, and related
expenses, in respect of letters of credit issued for the account of the Loan
Parties in connection with the purchase of goods by the Loan Parties in the
ordinary course of business and on payment terms of no more than 90 days after
the date of delivery of such goods, provided that such Liens (i) attach only to
the specific goods so purchased and title documents in respect thereof and (ii)
do not cover any Hydrocarbon Interests ; and provided further that the aggregate
amount of reimbursement obligations secured by Liens permitted by under this
Section
8.01(m) at any time outstanding, when added to the aggregate amount of
obligations then outstanding that are secured by Liens permitted under Section
8.01(n), shall not exceed $1,000,000;

     

    (n)           Liens
of sellers of goods to the Loan Parties arising by operation of law under
Article 2 of the UCC or similar provisions of applicable law in the ordinary
course of business, covering only the goods sold and title documents in respect
thereof and securing only the unpaid purchase price for such goods and related
expenses; provided that such Liens do not cover any Hydrocarbon Interests or
equity interests in Persons owning direct or indirect interests in Hydrocarbon
Interests; and provided further that the aggregate amount of obligations at any
time outstanding that are secured by Liens permitted by this Section
8.01(n), when added to the aggregate amount of reimbursement obligations
then outstanding secured by Liens permitted under Section
8.01(m), shall not exceed $1,000,000;

     

    (o)          other
Liens on property or assets (other than Oil and Gas Properties and equity
interests in Persons owning direct or indirect interests in Oil and Gas
Properties) securing obligations not exceeding at any time, in the aggregate,
$1,000,000;

     

    (p)           Liens
on assets (other than Oil and Gas Properties and equity interests in Persons
owning direct or indirect interests in Oil and Gas Properties) securing Assumed
Indebtedness as permitted under Section
8.05(h) provided that such Liens do not attach to any other assets;
and

     

    (q)           Liens
in favor of the Issuing Lender and/or Swingline Lender, including pursuant to
Section
2.15, to
cash collateralize or otherwise secure the obligations of a Defaulting Lender to
fund risk participations hereunder.

     

    8.02           Disposition
of Assets.  Each
Loan Party agrees that it shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, sell, assign, lease, convey, transfer
or otherwise dispose of (whether in one or a series of transactions)
(collectively, “Dispositions”)
any interests owned by any Loan Party or by any Subsidiary of a Loan Party in
Oil and Gas Properties or in other Property used or useful by the Loan Parties
or Subsidiaries in connection with such Oil and Gas Properties (including
accounts and notes receivable, with or without recourse) or enter into any
agreement to do any of the foregoing, except:

     

    
      
        

      

      Second Amended
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    (a)           as
permitted under Sections
7.05, 8.03,
8.04
or 8.09;

     

    (b)           Dispositions
of inventory, including produced Oil and Gas, in the ordinary course of
business;

     

    (c)           Dispositions
by the Company or any of its Subsidiaries to the Company or to a Guarantor
provided that a Disposition of any Mortgaged Property otherwise permitted under
this Section 8.02(c)
shall be permitted only if such Mortgaged Property remains subject to a Lien in
favor of the Administrative Agent for the benefit of the Lenders and the Lender
Derivative Parties pursuant to documentation executed by the transferee
reasonably satisfactory to the Administrative Agent, and in the case of a
Disposition to a Guarantor that is a Subsidiary, (x) the transferee Subsidiary
is engaged in the Principal Business and (y) the transferee Subsidiary is
Solvent prior to and after giving effect to such Disposition;

     

    (d)           used,
worn-out or surplus equipment in the ordinary course of business;
and

     

    (e)           Dispositions
not otherwise permitted under Sections
8.02(a) – (d) above;
provided that,
(i) no Event of Default shall exist at the time of such Disposition or result
therefrom, and (ii) the aggregate value (as determined by the Administrative
Agent to be the value assigned to such Properties under the most recent Reserve
Report) of all Dispositions of Oil and Gas Properties made by the Loan Parties
and by BEP I, plus the net effect of hedge modifications permitted under Section
8.10(d) during such period, together, shall not exceed in any Borrowing
Base Period five percent (5%) of the Borrowing Base then in effect; further provided
that, the Borrowing Base shall be automatically reduced by an amount
equal to the aggregate Borrowing Base value of such Oil and Gas Properties (as
determined by the Administrative Agent to be the value assigned to such
properties under the most recent Borrowing Base) and to the extent a Borrowing
Base Deficiency results from such reduction, up to one-hundred percent (100%) of
the proceeds of such Dispositions, net of reasonable fees, expenses and taxes,
shall be applied, as necessary, to cure such Borrowing Base
Deficiency.

     

    8.03           Consolidations
and Mergers.  No
Loan Party shall, or permit any of its Subsidiaries to, merge, consolidate with
or into, or convey, transfer, lease or otherwise dispose of (whether in one
transaction or in a series of transactions) all or substantially all of its
assets (whether now owned or hereafter acquired) to or in favor of any Person,
except:

     

    (a)           any
Subsidiary may merge with any Loan Party, provided that the
Company or other Loan Party, as applicable, shall be the continuing or surviving
entity;

     

    (b)           any
Subsidiary may sell, convey, transfer, lease or otherwise dispose of all or
substantially all of its assets (upon voluntary liquidation or otherwise), to
the Company or any other Subsidiary that is a Guarantor; and

     

    (c)           Dispositions
permitted under Section
8.02(e).

     

    8.04           Loans
and Investments.  No
Loan Party shall, or permit any of its Subsidiaries to, purchase, acquire, or
own, or permit any of its Subsidiaries to purchase, acquire, or own any capital
stock, equity interest, or any obligations or other securities of, or any
interest in, any Person (including any Unrestricted Entity), or make any
Acquisition, or make any advance, loan, extension of credit or capital
contribution to or any other investment in (collectively, “Investments”)
any Person including any Restricted Subsidiary, Unrestricted Entity or Affiliate
of the Company, except for:

     

    
      
        

      

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    (a)           (i)
Investments made on or prior to the Effective Date in the entities described in
Schedule
6.19,
and (ii)
existing Investments described in Schedule
8.04;

     

    (b)           Investments
in Cash Equivalents;

     

    (c)           extensions
of credit in the nature of accounts receivable or notes receivable arising from
the sale or lease of goods or services in the ordinary course of
business;

     

    (d)           Investments
(i) by Parent in or to the Company, and (ii) by the Company or any Subsidiary in
or to a Domestic Subsidiary that is a Guarantor or that becomes a Guarantor upon
the making of such Investments, provided, however,
that in the case of this clause (ii), during the continuation of an Event of
Default, no such Investments shall be made except to the extent determined by
the Company in the exercise of its good faith judgment to be reasonably
necessary to preserve the Mortgaged Properties;

     

    (e)           Investments
permitted under Section
8.02(c);

     

    (f)           Investments
in Derivative Contracts permitted under Section
8.10;

     

    (g)           Investments
with third parties that (i) are customary in the oil and gas business, (ii) are
made in the ordinary course of such Person’s business, and (iii) are made in the
form of or pursuant to Operating Agreements, process agreements, farm-in
agreements, farm-out agreements, development agreements, unitization agreements,
pooling agreements, joint bidding agreements, service contracts and other
similar agreements;

     

    (h)           extensions
of credit by the Company to any of its full time employees which do not exceed
$500,000 at any time outstanding in the aggregate to all such
employees;

     

    (i)      
     non-hostile Acquisitions of Equity or other
Acquisitions; provided that: (i) immediately
prior to and after giving effect to each such Acquisition, no Default or Event
of Default exists or would result therefrom; (ii) if such Acquisition is of
Equity of a Person, (x) all of the Equity of such Person is acquired and such
Person becomes a Guarantor and grants a lien on its assets, and all the Equity
in such Person is pledged as Collateral for the Obligations, in accordance with
Section
4.01 and (y) such Person is principally engaged in the same business as
the Loan Parties; and (iii) the Company shall be in pro forma compliance with
the covenants set forth in Section
8.14, 8.15 and
8.16
based on the trailing four (4) quarters and as adjusted on a pro forma basis for
such Acquisition;

     

    (j)           [Intentionally
Omitted];

     

    (k)           to
the extent not otherwise permitted under this Section
8.04, Investments in the Unrestricted Entities approved by the Majority
Lenders;

     

    (l)           (i)
Investments received in connection with the bankruptcy or reorganization of
suppliers and customers; and (ii) Investments consisting of extensions of credit
in the form of notes receivable received in settlement of delinquent obligations
of and other disputes with suppliers and customers, to the extent reasonably
necessary in order to prevent or limit loss; and in the case of clauses (i) and
(ii), arising in the ordinary course of business; provided that the aggregate
principal amount of notes received pursuant to clause (ii) shall not exceed
$5,000,000 in principal amount outstanding at any time;

     

    
      
        

      

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    (m)          Investments
consisting of extensions of credit in the form of notes receivable (“Seller
Notes”) received as consideration for any Disposition permitted under
Section
8.02(e) (other than Dispositions of interests under Derivative
Contracts), but only to the extent that such consideration is not prohibited by
such Section provided that, (i)
after giving effect to any such Disposition, there shall be no Borrowing Base
Deficiency; and (ii) the aggregate principal amount outstanding under such
Seller Notes (excluding any Seller Notes with respect to the sale of assets
other than Oil and Gas Properties and excluding equity interests in Subsidiaries
that do not own, directly or indirectly, any Oil and Gas Properties) shall not
at any time exceed $10,000,000;

     

    (n)           Contingent
Obligations permitted under Section
8.08; and

     

    (o)          other
Investments made after the Effective Date in an amount not to exceed $5,000,000
in the aggregate.

     

    8.05           Limitation
on Indebtedness.  No
Loan Party shall, or permit any of its Subsidiaries to, create, incur, assume,
suffer to exist, or otherwise become or remain directly or indirectly liable
with respect to, any Indebtedness, except:

     

    (a)           Indebtedness
incurred pursuant to this Agreement or the other Loan Documents;

     

    (b)           Indebtedness
consisting of Contingent Obligations permitted pursuant to Section
8.08;

     

    (c)           Indebtedness
incurred in connection with the issuance of Derivative Contracts permitted under
Section
8.10 hereof;

     

    (d)          specific
Indebtedness outstanding on the date hereof and listed in Schedule
8.05 hereto; and

     

    (e)           Senior
Unsecured Notes and guaranties given by the Company, the Parent or any
Subsidiary that is a guarantor hereunder with respect thereto; provided that (i) the
principal amount of such Indebtedness shall not exceed $350,000,000 in the
aggregate, and (ii) after giving pro forma effect to such issuance and any
attendant automatic reduction in the Borrowing Base (and any resulting mandatory
prepayment) required by the second proviso of this clause (e), Parent shall be
in compliance with Sections
8.14,  8.15 and 8.16 for
the four-fiscal quarter period most recently ended, further provided
that, the Borrowing Base shall automatically reduce on the date of such
issuance of Senior Unsecured Notes by an amount equal to 25% of the stated
principal amount of such Senior Unsecured Notes;

     

    (f)           Indebtedness
constituting Investments that are permitted pursuant to Section 8.04(d);

     

    (g)           Capitalized
Lease Obligations and purchase money Indebtedness in an aggregate principal
amount not to exceed $1,000,000 outstanding at any time;

     

    (h)           Assumed
Indebtedness, in an aggregate principal not to exceed $1,000,000 outstanding at
any time; and

     

    (i)       
    Unsecured Indebtedness not otherwise permitted under
Sections
8.05(a) – (h) above in an aggregate principal amount not exceeding
$10,000,000 at any time outstanding.

     

    
      
        

      

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    8.06           Transactions
with Affiliates.  No
Loan Party shall, or permit any of its Subsidiaries to, enter into any
transaction with or make any payment or transfer to (collectively, “Transactions”)
any Affiliate of the Company or such Loan Party, except in the ordinary course
of business and upon fair and reasonable terms no less favorable to the Company
or such other Person than would obtain in a comparable arm’s-length transaction
with a Person not an Affiliate of the Company; provided, however that the
foregoing restriction shall not apply to transactions between or among Loan
Parties.  Nothing in this Section
8.06 shall restrict the Company’s ability to make Restricted Payments
permitted under Section
8.09.

     

    8.07           Margin
Stock.

     

    (a)           No
Loan Party shall use any portion of the Loan proceeds, directly or indirectly,
(i) to purchase or carry Margin Stock, (ii) to repay or otherwise refinance
indebtedness of the Company or others incurred to purchase or carry Margin
Stock, (iii) to extend credit for the purpose of purchasing or carrying any
Margin Stock, or (iv) to acquire any security in any transaction that is subject
to Section 13 or 14 of the Exchange Act. If requested by the Administrative
Agent, the Company will furnish to the Administrative Agent and each Lender a
statement to the foregoing effect in conformity with the requirements of FR Form
U-1 or such other form referred to in Regulation U or Regulation X of the FRB,
as the case may be.

     

    (b)           The
Loan Parties, individually or in the aggregate, shall not at any time own Margin
Stock the value of which, for purposes of Regulation U, would exceed 10% of the
value of the Collateral unless (i) such Margin Stock shall have been pledged to
the Administrative Agent to secure the Obligations and the relevant Loan Party
shall have delivered such documentation as the Administrative Agent requires in
connection with such pledge and (ii) the Company shall have furnished to the
Administrative Agent and each Lender a statement in conformity with the
requirements of FR Form U-1 or such other form referred to in Regulation U or
Regulation X of the FRB, as the case may be.

     

    8.08           Contingent
Obligations.  No
Loan Party shall, or permit any of its Subsidiaries to, create, incur, assume or
suffer to exist any Contingent Obligations except:

     

    (a)           endorsements
for collection or deposit in the ordinary course of business;

     

    (b)           Derivative
Contracts permitted under Section
8.10 hereof and Guaranty Obligations of Parent with respect to the
Florida Crude Oil Purchase Contracts;

     

    (c)           Contingent
Obligations of the Loan Parties listed in Schedule 8.08
hereto, not to exceed $1,000,000 in the aggregate outstanding at any
time;

     

    (d)           plugging
bonds, performance bonds and fidelity bonds issued for the account of the
Company or its Subsidiaries, obligations to indemnify or make whole any surety
and similar agreements incurred in the ordinary course of business, provided that such
obligations shall not exceed $10,000,000 in the aggregate;

     

    (e)           this
Agreement and the Loan Documents;

     

    (f)       
    Contingent Obligations of any Loan Party in respect of
obligations of any other Loan Party to the extent such Obligations are permitted
under the Loan Documents; and

     

    (g)           any
other Contingent Obligations of the Loan Parties to the extent not described in
Sections
8.08(a) - (f) not to
exceed an aggregate amount of $10,000,000 outstanding at any time.

     

    
      
        

      

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    8.09           Restricted
Payments.  No
Loan Party shall, or permit any of its Subsidiaries to, purchase, redeem or
otherwise acquire for value any membership interests, partnership interests,
capital accounts, shares of its capital stock or any warrants, rights or options
to acquire such membership interest, partnership interest or shares, now or
hereafter outstanding from its members, partners or stockholders or declare or
pay any distribution, dividend or return capital to its members, partners or
stockholders, or make any distribution of assets in cash or in kind to its
members, partners or stockholders (collectively “Restricted
Payments”); except (a) Parent may declare and pay dividends with respect
to its Equity payable solely in additional shares of its Equity, (b)
Subsidiaries of the Company may declare and pay dividends ratably with respect
to their Equity, (c) the Company may declare and pay dividends to Parent, and
(d) Parent may declare and pay to its Equity owners quarterly cash dividends of
Available Cash or otherwise purchase, redeem or acquire for value any membership
interests, partnership interests, capital accounts, shares of its capital stock
or any warrants, rights or options to acquire such membership interest,
partnership interest or shares from its members, partners or stockholders in
accordance with its partnership agreement, so long as no Event of Default exists
or would result therefrom, and after giving effect to such Restricted Payment,
(i) the Loan Parties exhibit pro-forma compliance with all terms and conditions
of this Agreement, and (ii) the Available Borrowing Base equals an amount no
less than the lesser of (A) ten percent (10%) of the Borrowing Base, and
(B) the greater of (x) $50,000,000 and (y) twice the amount of the proposed
Restricted Payment.  By making a Restricted Payment pursuant to clause
(d) above, Parent represents and warrants to Administrative Agent and the
Lenders that the conditions for making such Restricted Payment have been
satisfied.

     

    8.10           Derivative
Contracts.  No
Loan Party shall, or permit any of its Subsidiaries to, enter into or in any
manner be liable on any Derivative Contract except:

     

    (a)          
Derivative Contracts entered into by the Company with the purpose and effect of
limiting or reducing the market price risk of Oil and Gas expected to be
produced by the Company and its Subsidiaries provided that at all
times: (i) each such Derivative Contract limits or reduces such market price
risk for a term of no more than sixty (60) months; (ii) no such contract, at the
time it is entered into, when aggregated with all Derivative Contracts permitted
under this Section
8.10(a) (but
excluding put option contracts or similar “floor” arrangements) requires
the Loan Parties and BEP I, collectively, to deliver more than 85% of the
reasonably anticipated production for each month for the total Oil and Gas
classified as either “proved producing” or “proved developed non-producing” on
(x) the Oil and Gas Properties covered under the most recent Reserve Report
delivered to the Administrative Agent and (y) any Oil and Gas Properties
acquired by the Loan Parties or BEP I after the effective date of such Reserve
Report classified as “proved producing” or “proved developed non-producing,”
(provided however, the “proved developed non-producing” reserves included in
such calculation shall not exceed 20% of the “proved producing” reserves),
provided, however, that with regard to a "costless collar" that involves the
purchase of a put and the sale of a call for the same volumes and dates and
commodities, only the volumes associated with the put or the call (but not both)
will be included in calculating the 85% threshold, and (iii) each such contract
shall be between the Company and a Lender Derivative Provider, or with an
unsecured counterparty or have a guarantor of the obligation of the unsecured
counterparty who, at the time the contract is made, has long-term obligations
rated BBB+ or Baal or better, respectively, by Standard & Poor’s Corporation
or Moody’s Investors Services, Inc. (or a successor credit rating agency)
(excluding (x) Derivative Contracts offered by national commodity exchange for
which no credit rating is required and (y) the Florida Crude Oil Purchase
Contracts for so long as such contracts are with Plains Marketing, L.P. or a
wholly owned subsidiary of Plains All American Pipeline, L.P.);

     

    
      
        

      

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      (b)           Derivative
Contracts entered into by the Company with the purpose and effect of fixing
interest rates on a principal amount of Indebtedness of the Company that is
accruing interest at a variable rate, provided that (i) the
floating rate index of each such contract generally matches the index used to
determine the floating rates of interest on the corresponding Indebtedness of
the Company to be hedged by such contract, (ii) no such contract, except those
with a Lender or its Affiliate, when aggregated with all Derivative Contracts
permitted under Sections
8.10(a) and (b),
requires the Company to put up money, assets, letters of credit, or other
security against the event of its non-performance prior to actual default by the
Company in performing obligations thereunder, and (iii) each such contract shall
be with a Lender Derivative Provider, or with an unsecured counterparty or have
a guarantor of the obligation of an unsecured counterparty who, at the time the
contract is made, has long-term obligations rated A+ or A1 or better,
respectively, by Standard & Poor’s Corporation or Moody’s Investors
Services, Inc. (or a successor credit rating agency);

       

      (c)           In
the event of a Derivative Contract between the Company and any of the Lenders,
the Contingent Obligation evidenced under such Derivative Contract shall not be
applied against such Lender’s Commitment nor against the Effective
Amount.  Any obligation of a Loan Party under any Lender Derivative
Contract shall be treated as an Obligation pari passu and secured pro
rata under the Security Documents with all other Obligations as more
particularly provided under Section 9.02 and
11.11; and

       

      (d)           The
Company shall not modify in any material respect to the extent it adversely
affects the then-current Borrowing Base or terminate any Derivative Contracts to
which it is currently a party or subsequently becomes a party without the
consent of the Administrative Agent, except that (i) Derivative Contracts with a
party who ceases to be a Lender (or  an Affiliate of a Lender) may be
terminated in connection with the assignment, amendment  or other
transaction pursuant to which such party ceases to be a Lender or an Affiliate
of a Lender, and (ii) so long as no Default or Event of Default exists,
Derivative Contracts may be modified or terminated, provided that, the
net effect of the modifications or terminations of such Derivative Contracts
(after giving effect to any new Derivative Contracts entered into during such
Borrowing Base Period prior to or in connection with, such modification or
termination), as determined by the Administrative Agent, plus the aggregate
value (as determined by the value assigned to such properties under the most
recent Reserve Report) of all Dispositions of Oil and Gas Properties made by the
Loan Parties during such period, together, shall not exceed in any Borrowing
Base Period five percent (5%) of the Borrowing Base then in effect; further provided
that, the Borrowing Base shall be automatically reduced by an amount
equal to the net effect of the modifications or terminations of such Derivative
Contracts (after giving effect to any new Derivative Contracts entered into
during such Borrowing Base Period prior to or in connection with, such
modification or termination) and to the extent a Borrowing Base Deficiency
results from such reduction, up to one-hundred (100%) of the cash and cash
equivalent proceeds of such modifications or terminations of Derivative
Contracts received by the Loan Parties, net of payment of, or provisions for
reasonable out-of-pocket fees, expenses and taxes incurred by the Company in
connection with such transaction, shall be applied, as necessary, to cure such
Borrowing Base Deficiency.

       

      8.11   
    Change
in Business; Amendments to Organization Documents and Certain Acquisition
Agreements; Corporate Structure; Tax Status.

       

      (a)           The
Loan Parties shall not, and shall not permit any of their Subsidiaries to, (i)
own Equity of any Foreign Person, or make any expenditure in or related to Oil
and Gas Properties not located within the geographic boundaries of the United
States, or (ii) enter into, or allow any Subsidiary to enter into, any joint
ventures except as permitted by Section
8.04.

       

      (b)           The
Loan Parties shall not, and shall not permit any subsidiary to, engage in any
business or activity other than its Principal Business.

       

      (c)           The
Loan Parties shall not alter, amend or modify in any manner materially adverse
to the Lenders any of its Organization Documents.

       

      
        
          
            

          
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      (d)           Parent
shall not alter, and shall take such actions as may be required in order to
maintain, its status as a partnership for United States federal income tax
purposes.

       

      8.12      
 Accounting Changes.  Except
as expressly permitted by the Lenders, no Loan Party shall, or permit any
Subsidiary to, make any significant change in accounting treatment or reporting
practices, except as required by GAAP, or change the fiscal year of any Loan
Party.

       

      8.13   
    ERISA Compliance.  Except
as would not reasonably be expected to result in a Material Adverse Effect, no
Loan Party will , or permit any Subsidiary to, at any time:

       

      (a)           engage
in, or permit any ERISA Affiliate to engage in, any transaction in connection
with which any Loan Party or any ERISA Affiliate could be subjected to either a
civil penalty assessed pursuant to subsections (c), (i) or (l) of section 502 of
ERISA or a tax imposed by Chapter 43 of Subtitle D of the Code.

       

      (b)           terminate,
or permit any ERISA Affiliate to terminate, any Pension Plan in a manner, or
take any other action with respect to any Pension Plan, which could result in
any liability of such Loan Party or any ERISA Affiliate to the
PBGC.

       

      (c)           fail
to make, or permit any ERISA Affiliate to fail to make, full payment when due of
all amounts which, under the provisions of any Plan, agreement relating thereto
or applicable law, any Loan Party or any ERISA Affiliate is required to pay as
contributions thereto.

       

      (d)           permit
to exist, or allow any ERISA Affiliate to permit to exist, any accumulated
funding deficiency within the meaning of section 302 of ERISA or section 412 of
the Code, whether or not waived, with respect to any Plan.

       

      (e)           permit,
or allow any ERISA Affiliate to permit, the actuarial present value of the
benefit liabilities under any Plan maintained by any Loan Party or any ERISA
Affiliate which is regulated under Title IV of ERISA to exceed the current value
of the assets (computed on a plan termination basis in accordance with Title IV
of ERISA) of such Plan allocable to such benefit liabilities.  The
term “actuarial present value of the benefit liabilities” shall have the meaning
specified in section 4041 of ERISA.

       

      (f)           incur,
or permit any ERISA Affiliate to incur, any withdrawal liability pursuant to
Section 4201 or 4202 of ERISA.

       

      (g)           acquire,
or permit any ERISA Affiliate to acquire, an interest in any Person that causes
such Person to become an ERISA Affiliate with respect to such Loan Party or with
respect to any ERISA Affiliate of such Loan Party if such Person sponsors,
maintains or contributes to, or at any time in the six-year period preceding
such acquisition has sponsored, maintained, or contributed to, (i) any
Multiemployer Plan with respect to which such Person has an outstanding
withdrawal liability under Section 4201 or 4202 of ERISA, or (ii) any other Plan
that is subject to Title IV of ERISA under which the actuarial present value of
the benefit liabilities under such Plan exceeds the current value of the assets
(computed on a plan termination basis in accordance with Title IV of ERISA) of
such Plan allocable to such benefit liabilities.

       

      (h)           incur,
or permit any ERISA Affiliate to incur, a liability to or on account of a Plan
under sections 515, 4062, 4063, 4064, or 4204 of ERISA.

      
         

        
          
            
              

            
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      (i)           contribute
to or assume an obligation to contribute to, or permit any ERISA Affiliate to
contribute to or assume an obligation to contribute to, any employee welfare
benefit plan, as defined in section 3(1) of ERISA, that provides retiree
benefits to former employees of such entities (other than coverage mandated by
applicable law), that may not be terminated by such entities in their sole
discretion at any time without any material liability.

       

      (j)           amend,
or permit any ERISA Affiliate to amend, a Plan resulting in an increase in
current liability such that such Loan Party or any ERISA Affiliate is required
to provide security to such Plan under section 401(a)(29) of the
Code.

       

      8.14   
    Interest Coverage Ratio.  Parent
shall not permit, as of the last day of each fiscal quarter beginning with the
fiscal quarter ended March 31, 2010, the ratio of EBITDAX for the four (4)
fiscal quarters ending on such date to Consolidated Interest Expense for the
four (4) fiscal quarters ending on such date to be less than 2.75 to
1.00.

       

      8.15   
    Leverage Ratio.  Parent
shall not permit the ratio of Total Indebtedness to EBITDAX for the four (4)
fiscal quarters ending on the last day of each fiscal quarter beginning with the
fiscal quarter ended March 31, 2010, to be greater than 3.75 to
1.00.

       

      8.16     
  Current Ratio.  Parent
shall not permit, as of the last day of any fiscal quarter beginning with the
fiscal quarter ending on March 31, 2010, the ratio of Current Assets to Current
Liabilities to be less than 1.00 to 1.00.

       

      8.17    
   Negative
Pledge.  Enter
into or permit to exist any contractual obligation (other than this Agreement or
any other Loan Document) that limits the ability (a) of any Subsidiary to make
Restricted Payments to or otherwise transfer property to Parent, the Company or
any Guarantor, (b) of Parent to Guarantee the Indebtedness of the Company, or
any Subsidiary to Guarantee the Indebtedness of the Company, or (c) of Parent,
the Company, or any Subsidiary to create, incur, assume or suffer to exist Liens
on property of such Person to secure the Obligations.

       

      8.18   
    Unrestricted
Entities.  No
Loan Party or any of its Subsidiaries shall guarantee or otherwise become liable
in respect of any Indebtedness or any other obligations, or grant any Lien on
any of its property to secure any Indebtedness of or other obligations of, or
provide any other form of credit support to, any Unrestricted
Entity.

       

      ARTICLE
IX.

       

      EVENTS
OF DEFAULT

       

      9.01  
     Event of Default.  Any
of the following shall constitute an “Event of
Default”:

       

      (a)           Non-Payment.  The
Company or any other Loan Party fails to pay (i) when and as required to be paid
herein, any amount of principal of any Loan, (ii) fails to pay within three (3)
days of when due, interest on any Loan, or (ii) fails to pay within five (5)
Business Days of when due any fee or other amount payable hereunder or under any
other Loan Document; or

       

      (b)           Representation or
Warranty.  Any representation or warranty by any Loan Party
made or deemed made herein, in any other Loan Document, or which is contained in
any certificate, document or financial or other statement by the Company, any
other Loan Party, or any Responsible Officer of such Person, furnished at any
time under this Agreement, or in or under any other Loan Document, is incorrect
in any material respect on or as of the date made or deemed made;
or

      
         

        
          
            
              

            
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      (c)           Specific
Defaults.  Any Loan Party fails to perform or observe any term,
covenant or agreement contained in Section 7.03(a)
or Article
VIII (except for such Liens under Section
8.01 other than arising by consensual action of such Loan Party);
or

       

      (d)           Other
Defaults.  An Event of Default as defined in any Security
Document shall occur, or any Loan Party fails to perform or observe any other
term or covenant contained in this Agreement (other than described in this Section
9.01) or any other Loan Document, and same shall continue unremedied for
a period of 30 days after the earlier of (i) the date upon which a Responsible
Officer knew thereof or (ii) the date upon which written notice thereof is given
to the Company by the Administrative Agent or any Lender; or

       

      (e)           Cross-Acceleration.  (i)
any Loan Party or any Subsidiary thereof fails to make any payment in respect of
any Indebtedness or Contingent Obligation having an aggregate principal amount
(including undrawn committed or available amounts and including amounts owing to
all creditors under any combined or syndicated credit arrangement) of more than
the $10,000,000 when due (whether by scheduled maturity, required prepayment,
acceleration, demand, or otherwise) and such failure continues after the
applicable grace period, if any, specified in the relevant document on the date
of such failure; or (ii) any Loan Party or any Subsidiary thereof fails after
the applicable grace or notice period, if any, specified in the relevant
document on the date of such failure to perform or observe any other condition
or covenant, or any other event shall occur or condition exist, under any
agreement or instrument relating to any such Indebtedness or Contingent
Obligation having an aggregate principal amount of more than $10,000,000 which
results in such Indebtedness or such Contingent Obligation being declared due
and payable (or becoming subject to mandatory repurchase or redemption) prior to
its stated maturity; or

       

      (f)           Insolvency; Voluntary
Proceedings.  Any Loan Party, any Subsidiary thereof or
BreitBurn GP LLC (i) generally fails to pay, or admits in writing its inability
to pay, its debts as they become due, subject to applicable grace periods, if
any, whether at stated maturity or otherwise; (ii) commences any Insolvency
Proceeding with respect to itself; or (iii) takes any action to effectuate or
authorize any of the foregoing; or

       

      (g)           Involuntary
Proceedings.  (i) Any involuntary Insolvency Proceeding is
commenced or filed against any Loan Party, any Subsidiary thereof or BreitBurn
GP LLC, or any writ, judgment, warrant of attachment, execution or similar
process, is issued or levied against all or a substantial part of any such
Person’s properties, and any such proceeding or petition shall not be dismissed,
or such writ, judgment, warrant of attachment, execution or similar process
shall not be released, vacated or fully bonded within 60 days after
commencement, filing or levy; (ii) any Loan Party, any Subsidiary
thereof  or BreitBurn GP LLC admits the material allegations of a
petition against it in any Insolvency Proceeding, or an order for relief (or
similar order under non-U.S. law) is ordered in any Insolvency Proceeding; or
(iii) any Loan Party, any Subsidiary thereof or BreitBurn GP LLC acquiesces in
the appointment of a receiver, trustee, custodian, conservator, liquidator,
mortgagee in possession (or agent therefor), or other similar Person for itself
or a substantial portion of its property or business; or

       

      (h)           Change in Management or
Control.  Both Halbert Washburn and Randall Breitenbach shall
cease for any reason to serve and function as CEO of BreitBurn GP LLC and
neither shall be succeeded in such position or other comparable position
acceptable to the Majority Lenders, within sixty (60) days by a Person
acceptable to the Majority Lenders; or there shall occur a Change of Control;
or

      
         

        
          
            
              

            
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      (i)           Monetary Judgments.
One or more non-interlocutory judgments, non-interlocutory orders, decrees or
arbitration awards is entered against any Loan Party, any Subsidiary thereof or
General Partner involving in the aggregate a liability (to the extent not
covered by independent third-party insurance as to which the insurer does not
dispute coverage) as to any single or related series of transactions, incidents
or conditions, of $10,000,000 or more, and the same shall remain unsatisfied,
unvacated and unstayed pending appeal for a period of 30 days after the entry
thereof; or

       

      (j)           Loss of
Permit.  Any Governmental Authority revokes or fails to renew
any material license, permit or franchise of any Loan Party, or any Loan Party
for any reason loses any material license, permit or franchise, or any Loan
Party suffers the imposition of any restraining order, escrow, suspension or
impounding of funds in connection with any proceeding (judicial or
administrative) with respect to any material license, permit or franchise; and,
in each case such revocation, failure or loss could reasonably be expected to
have a Material Adverse Effect; and such default remains unremedied for a period
of 30 days after the earlier of (i) the date upon which a Responsible Officer
knew or reasonably should have known of such default or (ii) the date upon which
written notice thereof is given to the Company by the Administrative Agent or
any Lender; or

       

      (k)           Invalidity of Loan
Documents.  A Guaranty or any other Loan Document is for any
reason partially (including with respect to future advances) or wholly revoked
or invalidated, or otherwise ceases to be in full force and effect other than in
accordance with its terms or the terms of this Agreement, or a Guarantor or any
other Person contests in any manner the validity or enforceability thereof or
any Loan Party denies that it has any further liability or obligation
thereunder; or

       

      (l)           ERISA. The occurrence
of any of the following events: (i) the happening of a Reportable Event which
has resulted or could reasonably be expected to result in a Material Adverse
Effect (if not waived by the PBGC or by the Majority Lenders, or if such event
can be avoided by any corrective action of the Loan Party affected thereby, such
corrective action is not completed within ninety (90) days after the occurrence
of such Reportable Event) with respect to any Pension Plan; (ii) the termination
of any Pension Plan in a “distress termination” under the provisions of Section
4041 of ERISA; (iii) the appointment of a trustee by an appropriate United
States District Court to administer any Pension Plan; and (iv) the institution
of any proceedings by the PBGC to terminate any Pension Plan or to appoint a
trustee to administer any such plan; or

       

      (m)           Environmental Claims.
An Environmental Claim shall have been asserted against any Loan Party or any
subsidiary thereof which could reasonably be expected to have a Material Adverse
Effect.

       

      9.02   
    Remedies.

       

      (a)           If
any Event of Default occurs and is continuing, the Administrative Agent shall,
at the request of, or may, with the consent of, the Majority
Lenders

       

      (i)           declare
the Commitment, if any, of each Lender to make Loans and issue Letters of Credit
to be terminated, and/or declare all or any part of the unpaid principal of the
Loans, all interest accrued and unpaid thereon and all other amounts payable
under the Loan Documents to be immediately due and payable, whereupon the same
shall become due and payable, without presentment, demand, protest, notice of
intention to accelerate, notice of acceleration or any other notice of any kind,
all of which are hereby expressly waived by each Loan Party;

       

      (ii)           require
that the Company deposit cash collateral pursuant to Section
2.10(h); and

      
         

        
          
            
              

            
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      (iii)           exercise
on behalf of itself and the Lenders all rights and remedies available to it and
the Lenders under the Loan Documents or applicable law;

       

      provided, however, that upon
the occurrence of any event specified in Subsection
(f) or (g) of
Section
9.01 (in the case of clause (i) of Subsection
(g) upon the expiration of the 60-day period mentioned therein), the
obligation of each Lender to make Loans and issue Letters of Credit shall
automatically terminate and the unpaid principal amount of all outstanding Loans
and all interest and other amounts as aforesaid shall automatically become due
and payable, and the obligation of the Company to cash collateralize Letters of
Credit shall automatically become effective, without further act of the
Administrative Agent, or any Lender and without presentment, demand, protest,
notice of intention to accelerate, notice of acceleration or any other notice of
any kind, all of which are hereby expressly waived by each Loan
Party.

       

      (b)           All
proceeds realized from the liquidation or other disposition of Collateral and
any amounts otherwise received on account of the Obligations after the exercise
of remedies provided for in Section
9.02 (or after any of the Loans have automatically become immediately due
and payable and the LC Obligations have automatically been required to be cash
collateralized) shall be applied:

       

      first, to
the payment of that portion of the Obligations constituting reimbursement of
fees, expenses, indemnities and other amounts (including fees and disbursements
of counsel to the Administrative Agent) payable to the Administrative Agent in
its capacity as such;

       

      second,
to the payment of that portion of the Obligations constituting fees, indemnities
and other amounts (other than principal, interest and Letter of Credit Fees)
payable to the Lenders and the Issuing Lender (including fees and expenses of
counsel), ratably among them in proportion to the respective amounts described
in this clause second payable to them;

       

      third, to
the payment of that portion of the Obligations constituting accrued and unpaid
Letter of Credit Fees and interest on the Obligations, ratably among the Lenders
and the Issuing Lender in proportion to the respective amounts described in this
clause third payable to them;

       

      fourth,
to the Administrative Agent for the account of the Issuing Lender, to cash
collateralize that portion of the LC Obligations comprised of the aggregate
undrawn amount of Letters of Credit (to the extent not otherwise cash
collateralized pursuant Section
2.15, and to the payment of that portion of the Obligations constituting
of unpaid principal of the Loans, unpaid drawings under Letters of Credit, and
Indebtedness owed to Lender Derivative Providers under any Lender Derivative
Contracts, ratably among the Lenders, the Issuing Lenders and the Lender
Derivative Providers in proportion to the respective amounts described in this
clause fourth;

       

      fifth, to
payment of other unpaid Obligations, ratably to the holders thereof in
proportion to the respective amounts described in this clause fifth;
and

       

      sixth,
any excess shall be paid to the Company or as otherwise required by
law.

       

      Notwithstanding
the foregoing, the Administrative Agent shall have no obligation to distribute
funds in respect of Obligations under Lender Derivative Contracts if the
Administrative Agent has not received written notice thereof, together with such
supporting documentation as the Administrative Agent may request, from the
applicable Lender Derivative Provider.  Each Lender Derivative
Provider that has given the notice contemplated by the preceding sentence shall,
by such notice, be deemed to have acknowledged and accepted the appointment of
the Administrative Agent pursuant to the terms of Article IX
hereof for itself and its Affiliates to the same extent as a “Lender”
party hereto.

      
         

        
          
            
              

            
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      9.03    
   Rights Not Exclusive.  The
rights provided for in this Agreement and the other Loan Documents are
cumulative and are not exclusive of any other rights, powers, privileges or
remedies provided by law or in equity, or under any other instrument, document
or agreement now existing or hereafter arising.

       

      9.04     
  Lender and Lender Derivative Provider Action.  Without
limiting the provisions of Section
11.03(b) or Section
11.08, the Issuing Lender and each Lender, in its capacity as a Lender
and in its capacity as a Lender Derivative Provider, and each other Lender
Derivative Provider, by its acceptance of the benefits of the Security Documents
creating Liens to secure Lender Derivative Obligations, agrees
that:

       

      (a)           it
will not, without the prior written consent of the Administrative Agent,
exercise any right to set off or apply any deposits of any kind, or any other
obligations owing by it to or for the order of the Company or any of its
Subsidiaries, against any Obligations under Lender Derivative Contracts (“Lender Derivative
Obligations”) or any other amounts secured by Liens on Collateral;
provided that nothing contained in this Section or elsewhere in this Agreement
shall impair the right of any Lender Derivative Provider to declare an early
termination date in respect of any Lender Derivative Contracts, or to undertake
payment or close-out netting or to otherwise setoff trades or transactions then
existing under such Lender Derivative Contracts;

       

      (b)           it
will not, without the prior written consent of the Administrative
Agent,  take any judicial or other action against the Company or any
Subsidiary, or against any Collateral or any other collateral pledged to secure
any Lender Derivative Obligations, of the type that would invoke the application
of the “security first” rule contained in Section 726 of the California Code of
Civil Procedure or any subsequent replacement statutory provision;

       

      (c)           it
will not, without the prior written consent of the Administrative Agent, (x)
pursue or attempt to realize upon any Collateral or any part or portion thereof,
(y) do anything or take any action with respect to any Collateral which would
constitute an “action” for purposes of California law, or (z) bid on any
Collateral at a foreclosure sale, or take possession or operate any portion of
the Collateral which constitutes real property;

       

      (d)           it
will not transfer any portion of its rights in respect of any Lender Derivative
Contract or Lender Derivative Obligations, unless the assignee agrees in writing
to be bound by the terms of this Section
9.04 and a copy of such writing is delivered to the Administrative Agent;
and

       

      (e)           if
it exercises any right of setoff in contravention of this Section
9.04 or in contravention of Section
11.03, it shall indemnify the Administrative Agent and each other Lender,
the Issuing Lender and each Lender Derivative Provider, from any and all losses,
expenses and damages (including attorneys’ fees and costs) it shall suffer or
incur by reason of such setoff or other action, including losses, expenses and
damages (including attorneys’ fees and costs) caused by or resulting from the
release, loss or waiver of any Collateral or any Lien thereon securing
Obligations, or the unenforceability of any Security Document or Loan Document
or any assertions that any Collateral or Lien securing Obligations thereon was
released, lost or waived.

       

      The
provisions of this Section
9.04 shall apply to the Issuing Lender, all Lenders and all Lender
Derivative Providers and their respective successors and
assigns.   The provisions of this Section
9.04 are solely for the benefit of the Administrative Agent, the Issuing
Lender, the Lenders and the Lender Derivative Providers, and neither the Company
nor any Subsidiary shall have rights as a third party beneficiary of any such
provisions.

      
         

        
          
            
              

            
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      ARTICLE
X.

       

      ADMINISTRATIVE
AGENT

       

      10.01 
    Appointment and Authority.  Each
of the Lenders and the Issuing Lender hereby irrevocably appoints Administrative
Agent to act on its behalf as the Administrative Agent hereunder and under the
other Loan Documents and authorizes the Administrative Agent to take such
actions on its behalf and to exercise such powers as are delegated to the
Administrative Agent by the terms hereof or thereof, together with such actions
and powers as are reasonably incidental thereto.  The provisions of
this Article are solely for the benefit of the Administrative Agent, the Lenders
and the Issuing Lender, and neither the Company nor any other Loan Party shall
have rights as a third party beneficiary of any of such provisions.

       

      10.02    
 Rights as a Lender.  The
Person serving as the Administrative Agent hereunder shall have the same rights
and powers in its capacity as a Lender as any other Lender and may exercise the
same as though it were not the Administrative Agent and the term “Lender” or
“Lenders” shall, unless otherwise expressly indicated or unless the context
otherwise requires, include the Person serving as the Administrative Agent
hereunder in its individual capacity.  Such Person and its Affiliates
may accept deposits from, lend money to, act as the financial advisor or in any
other advisory capacity for and generally engage in any kind of business with
Parent or any Subsidiary or other Affiliate thereof as if such Person were not
the Administrative Agent hereunder and without any duty to account therefor to
the Lenders.

       

      10.03  
   Exculpatory Provisions.  The
Administrative Agent shall not have any duties or obligations except those
expressly set forth herein and in the other Loan Documents.  Without
limiting the generality of the foregoing, the Administrative Agent:

       

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

       

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

       

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

       

      The
Administrative Agent shall not be liable for any action taken or not taken by it
(i) with the consent or at the request of the Required Lenders (or such other
number or percentage of the Lenders as shall be necessary, or as the
Administrative Agent shall believe in good faith shall be necessary, under the
circumstances as provided in Sections 9.02
and 11.01) or
(ii) in the absence of its own gross negligence or willful
misconduct.  The Administrative Agent shall be deemed not to have
knowledge of any Default unless and until notice describing such Default is
given to the Administrative Agent by the Company, a Lender or the Issuing
Lender.

      
         

        
          
            
              

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

       

      10.04  
  Reliance by Administrative Agent.  The
Administrative Agent shall be entitled to rely upon, and shall not incur any
liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing (including any electronic
message, Internet or intranet website posting or other distribution) believed by
it to be genuine and to have been signed, sent or otherwise authenticated by the
proper Person.  The Administrative Agent also may rely upon any
statement made to it orally or by telephone and believed by it to have been made
by the proper Person, and shall not incur any liability for relying
thereon.  In determining compliance with any condition hereunder to
the making of a Loan, or the issuance of a Letter of Credit, that by its terms
must be fulfilled to the satisfaction of a Lender or the Issuing Lender, the
Administrative Agent may presume that such condition is satisfactory to such
Lender or the Issuing Lender unless the Administrative Agent shall have received
notice to the contrary from such Lender or the Issuing Lender prior to the
making of such Loan or the issuance of such Letter of Credit.  The
Administrative Agent may consult with legal counsel (who may be counsel for the
Company), 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.

       

      10.05  
  Delegation of Duties.  The
Administrative Agent may perform any and all of its duties and exercise its
rights and powers hereunder or under any other Loan Document by or through any
one or more sub agents appointed by the Administrative Agent.  The
Administrative Agent and any such sub agent may perform any and all of its
duties and exercise its rights and powers by or through their respective Related
Parties.  The exculpatory provisions of this Article shall apply to
any such sub agent and to the Related Parties of the Administrative Agent and
any such sub agent, and shall apply to their respective activities in connection
with the syndication of the credit facilities provided for herein as well as
activities as Administrative Agent.

       

      10.06   
  Resignation of Administrative Agent.  The
Administrative Agent may at any time give notice of its resignation to the
Lenders, the Issuing Lender and the Company.  Upon receipt of any such
notice of resignation, the Required Lenders shall have the right, in
consultation with the Company, to appoint a successor, which shall be a bank
with an office in the United States, or an Affiliate of any such bank with an
office in the United States.  If no such successor shall have been so
appointed by the Required Lenders and shall have accepted such appointment
within 30 days after the retiring Administrative Agent gives notice of its
resignation, then the retiring Administrative Agent may on behalf of the Lenders
and the Issuing Lender, appoint a successor Administrative Agent meeting the
qualifications set forth above provided that if the Administrative Agent shall
notify the Company and the Lenders that no qualifying Person has accepted such
appointment, then such resignation shall nonetheless become effective in
accordance with such notice and (1) the retiring Administrative Agent shall be
discharged from its duties and obligations hereunder and under the other Loan
Documents (except that in the case of any collateral security held by the
Administrative Agent on behalf of the Lenders or the Issuing Lender under any of
the Loan Documents, the retiring Administrative Agent shall continue to hold
such collateral security until such time as a successor Administrative Agent is
appointed) and (2) all payments, communications and determinations provided to
be made by, to or through the Administrative Agent shall instead be made by or
to each Lender and the Issuing Lender directly, until such time as the Required
Lenders appoint a successor Administrative Agent as provided for above in this
Section
10.06.  Upon the acceptance of a successor’s appointment as
Administrative Agent hereunder, such successor shall succeed to and become
vested with all of the rights, powers, privileges and duties of the retiring (or
retired) Administrative Agent, and the retiring Administrative Agent shall be
discharged from all of its duties and obligations hereunder or under the other
Loan Documents (if not already discharged therefrom as provided above in this
Section
10.06).  The fees payable by the Company to a successor
Administrative Agent shall be the same as those payable to its predecessor
unless otherwise agreed between the Company and such successor.  After
the retiring Administrative Agent’s resignation hereunder and under the other
Loan Documents, the provisions of this Article X
and Section
11.04 shall continue in effect for the benefit of such retiring
Administrative Agent, its sub agents and their respective Related Parties in
respect of any actions taken or omitted to be taken by any of them while the
retiring Administrative Agent was acting as Administrative Agent.

      
         

        
          
            
              

            
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      10.07    
 Non-Reliance on Administrative Agent and Other Lenders.  Each Lender and
the Issuing Lender acknowledges that it has, independently and without reliance
upon the Administrative Agent or any other Lender or any of their Related
Parties and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement.  Each Lender and the Issuing Lender also acknowledges that
it will, independently and without reliance upon the Administrative Agent or any
other Lender or any of their Related Parties and based on such documents and
information as it shall from time to time deem appropriate, continue to make its
own decisions in taking or not taking action under or based upon this Agreement,
any other Loan Document or any related agreement or any document furnished
hereunder or thereunder.

       

      10.08 
    Administrative Agent May File Proofs of
Claim.  In
case of the pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to any Loan Party or any of its Subsidiaries, the
Administrative Agent (irrespective of whether the principal of any Loan shall
then be due and payable as herein expressed or by declaration or otherwise and
irrespective of whether the Administrative Agent shall have made any demand on
the Company) shall be entitled and empowered, by intervention in such proceeding
or otherwise:

       

      (a)           to
file and prove a claim for the whole amount of the principal and interest owing
and unpaid in respect of the Loans, the LC Obligation and all other Obligations
that are owing and unpaid and to file such other documents as may be necessary
or advisable in order to have the claims of the Lenders, the Issuing Lender and
the Administrative Agent (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Lenders, the Issuing Lender and the
Administrative Agent and their respective agents and counsel and all other
amounts due the Lenders, the Issuing Lender and the Administrative Agent under
Section 2.07,
Section
2.08 or Section
11.04(a)) allowed in such judicial proceeding; and

       

      (b)           to
collect and receive any monies or other property payable or deliverable on any
such claims and to distribute the same; and any custodian, receiver, assignee,
trustee, liquidator, sequestrator or other similar official in any such judicial
proceeding is hereby authorized by each Lender to make such payments to the
Administrative Agent and, in the event that the Administrative Agent shall
consent to the making of such payments directly to the Lenders and the Issuing
Lender, to pay to the Administrative Agent any amount due for the reasonable
compensation, expenses, disbursements and advances of the Administrative Agent
and its agents and counsel, and any other amounts due the Administrative Agent
under Section
11.04(a).

      
         

        
          
            
              

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

       

      10.09      Authority of Administrative Agent to Release Collateral
and Liens.  The
Issuing Lender, each Lender (including in its capacity as a Lender Derivative
Provider), and each other Lender Derivative Provider, by its acceptance of the
benefits of the Liens created by the Security Documents, hereby authorize and
instruct the Administrative Agent to release any Collateral that is permitted to
be sold or released pursuant to the terms of the Loan Documents, upon written
request of the Company certifying the consummation of such sale or the
satisfaction of the conditions to such release, accompanied by such supporting
documentation as the Administrative Agent may reasonably request, and each
Lender, Issuing Lender and Lender Derivative Provider hereby authorizes the
Administrative Agent to execute and deliver to the Company, at the Company’s
sole cost and expense, any and all releases of Liens, termination statements,
assignments, or other documents reasonably requested by the Company in
connection with any sale or other disposition of property to the extent such
sale or other disposition is permitted by the terms of Section
8.02 or is otherwise authorized by the terms of the Loan
Documents.

       

      10.10  
   The Arrangers and other Agents.  Anything
herein to the contrary notwithstanding, no Person listed as a Co-Lead Arranger
or as a Co-Documentation Agent on the cover page of this Agreement shall have
any powers, duties or responsibilities under this Agreement or any of the other
Loan Documents, except in its capacity, as applicable, as the Administrative
Agent, a Lender or the Issuing Lender hereunder.

       

      ARTICLE
XI.

       

      MISCELLANEOUS

       

      11.01    
 Amendments and Waivers.  No
amendment, modification, termination or waiver of any provision of this
Agreement or any other Loan Document, and no consent with respect to any
departure by the Company or any applicable Loan Party therefrom, shall be
effective unless the same shall be in writing and signed by the Majority Lenders
(or by the Administrative Agent at the written request of the Majority Lenders)
and the Company and acknowledged by the Administrative Agent, and then any such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given; provided, however, that no such
waiver, amendment, modification, termination or consent shall:

       

      (a)           increase
or extend the Commitment of any Lender, without the written consent of such
Lender (or reinstate any Commitment terminated pursuant to Section
9.02);

       

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

       

      (c)           reduce
the principal of, or the rate of interest specified herein on any Loan, or any
fees or other amounts payable hereunder or under any other Loan Document,
without the written consent of each Lender directly affected
thereby;

       

      
        
          
            

          
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      (d)           change
in any manner the definition of “Majority Lenders” or “Required Lenders” or change
Section
2.12 or Section 9.02(b)
in a manner that would alter the pro rata sharing of payments required
thereby, without the written consent of each Lender;

       

      (e)           amend
this Section
11.01 or any provision of this Agreement which, by its terms, expressly
requires the approval or concurrence of all Lenders, without the written consent
of each Lender;

       

      (f)           release
all, substantially all, or any material portion of the Collateral (except for
releases in connection with dispositions of assets which are permitted hereunder
or under any Loan Document), or release any Subsidiary from any Guaranty, except
for releases in connection with sales of Subsidiaries permitted hereunder,
without the written consent of each Lender; provided that the Administrative
Agent may release Collateral as permitted by Section
10.09 and Section 11.11(c);

       

      (g)           increase
the Borrowing Base pursuant to Section
2.05, without the written consent of each Lender, provided, the
Required Lenders may maintain or decrease the Borrowing Base pursuant to Section
2.05; or

       

      (h)           amend
the definition of “Lender
Derivative Contracts” or “Lender Derivative Provider”
or clause
(b) of the definition of “Obligations” in a manner
materially adverse to any Lender Derivative Provider who is a Lender at such
time or who is an Affiliate of a Lender at such time, without the written
consent of each such Lender;

       

      and provided further, that (i) no
amendment, waiver or consent shall, unless in writing and signed by the Issuing
Lender in addition to the Majority Lenders or all the Lenders, as the case may
be, affect the rights or duties of the Issuing Lender under this Agreement or
any LC Related Document relating to any Letter of Credit Issued or to be Issued
by it, (ii) no amendment, waiver or consent shall, unless in writing and signed
by the Swing Line Lender in addition to the Majority Lenders or all the Lenders,
as the case may be, affect the rights or duties of the Swing Line Lender under
this Agreement, (iii) no amendment, waiver or consent shall, unless in writing
and signed by the Administrative Agent in addition to the Majority Lenders or
all the Lenders, as the case may be, affect the rights or duties of the
Administrative Agent under this Agreement or any other Loan Document, and (iv)
the Engagement Letter may be amended and terms thereof may be waived by a
writing signed by the parties thereto.

       

      If any
Lender refuses to consent to any amendment, waiver or other modification of any
Loan Document requested by the Company that requires the consent of a greater
percentage of the Lenders than the Majority Lenders and such amendment, waiver
or other modification is consented to by the Majority Lenders, then the Company
may replace such Lender in accordance with the provisions of Section
3.07(b).

       

      11.02   
  Notices;
Effectiveness; Electronic Communication.

       

      (a)           General. Except in
the case of notices and other communications expressly permitted to be given by
telephone (and except as provided in subsection
(b) below), all notices and other communications provided for herein
shall be in writing and shall be delivered by hand or overnight courier service,
mailed by certified or registered mail or sent by telecopier, or delivered by
electronic mail to the electronic mail address, specified for notices on Schedule
11.02 (for the Company, the Guarantors, the Issuing Lender, the Swing
Line Lender and the Administrative Agent) or on the Administrative Questionnaire
(for the Lenders). Notices sent by hand or overnight courier service, or mailed
by certified or registered mail, shall be deemed to have been given when
received; notices sent by telecopier shall be deemed to have been given when
sent if the sender receives an acknowledgment of receipt (except that, if not
given during normal business hours for the recipient, shall be deemed to have
been given at the opening of business on the next business day for the
recipient).  Notices delivered through electronic communications to
the extent provided in subsection(b)
below, shall be effective as provided in said subsection
(b).

      
         

        
          
            
              

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

       

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

       

      (c)           Change of Address,
Etc. Each of the Company, the Administrative Agent, the Issuing Lender
and the Swing Line Lender may change its address, telecopier or telephone number
for notices and other communications hereunder by notice to the other parties
hereto. Each other Lender may change its address, telecopier or telephone number
for notices and other communications hereunder by notice to the Company,
Administrative Agent, the Issuing Lender and the Swing Line Lender.

       

      (d)           Notice to Administrative
Agent.  Each Lender shall notify the Administrative Agent in
writing of any changes in the address to which notices to the Lender should be
directed, of addresses of any Lending Office, of payment instructions in respect
of all payments to be made to it hereunder and of such other administrative
information as the Administrative Agent shall reasonably request.

       

      (e)           Effectiveness of Facsimile
and PDF Documents and Signatures.  Loan Documents may be
transmitted and/or signed by facsimile and PDF.  The effectiveness of
any such documents and signatures shall, subject to applicable Law, have the
same force and effect as manually-signed originals and shall be binding on all
Loan Parties, the Administrative Agent and the Lenders.  The
Administrative Agent may also require that any such documents and signatures be
confirmed by a manually-signed original thereof; provided, however, that the
failure to request or deliver the same shall not limit the effectiveness of any
facsimile or PDF document or signature.

       

      11.03    
 No Waiver; Cumulative Remedies.

       

      (a)           No
failure to exercise and no delay in exercising, on the part of the
Administrative Agent or any Lender, any right, remedy, power or privilege
hereunder, shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, remedy, power or privilege hereunder preclude any other
or further exercise thereof or the exercise of any other right, remedy, power or
privilege.

       

      
        
          
            

          
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      (b)           Notwithstanding
anything to the contrary contained herein or in any other Loan Document, and
without limiting the provisions of Section
9.04, the authority to enforce rights and remedies hereunder and under
the other Loan Documents  against the Loan Parties or any of them
shall be vested exclusively in, and all actions and proceedings at law in
connection with such enforcement shall be instituted and maintained exclusively
by, the Administrative Agent in accordance with Section
9.02 for the benefit of all the Lenders, the Issuing Lender, and the
Lender Derivative Providers;  provided, however, that the foregoing
shall not prohibit (a) the Administrative Agent from exercising on its own
behalf the rights and remedies that inure to its benefit (solely in its capacity
as Administrative Agent) hereunder and under the other Loan Documents, (b) the
Issuing Lender or the Swing Line Lender from exercising, with the consent of the
Administrative Agent, the rights and remedies that inure to its benefit (solely
in its capacity as Issuing Lender or Swing Line Lender, as the case may be)
hereunder and under the other Loan Documents, (c) any Lender from exercising,
with the consent of the Administrative Agent,  setoff rights in
accordance with Section 11.08
(subject to the limitations set forth therein and subject to terms of Section 2.12 and
Section 9.04), or (d) any Lender or Lender Derivative Provider from
filing proofs of claim or appearing and filing pleadings on its own behalf
during the pendency of a proceeding relative to any Loan Party under the
Bankruptcy Code or other debtor relief law.

       

      11.04   
  Costs and Expenses; Indemnity.

       

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

       

      (b)           Indemnification by the
Company.  The Company shall indemnify the Administrative Agent
(and any sub-agent thereof), each Lender and the Issuing Lender, and each
Related Party of any of the foregoing Persons (each such Person being called an
“Indemnitee”)
against, and hold each Indemnitee harmless from, any and all losses, claims,
damages, liabilities and related expenses (including the fees, charges and
disbursements of any counsel for any Indemnitee) incurred by any Indemnitee or
asserted against any Indemnitee by any third party or by the Company or any
other Loan Party arising out of, in connection with, or as a result of, any
actual, threatened or prospective claim, litigation, investigation or proceeding
relating to (i) the execution or delivery of this Agreement, any other Loan
Document or any agreement or instrument contemplated hereby or thereby, the
performance by the parties hereto of their respective obligations hereunder or
thereunder or the consummation of the transactions contemplated hereby or
thereby, (ii) any Loan or Letter of Credit or the use or proposed use of
the proceeds therefrom (including any refusal by the Issuing Lender to honor a
demand for payment under a Letter of Credit if the documents presented in
connection with such demand do not strictly comply with the terms of such Letter
of Credit), or (iii) any actual or alleged presence or Release of Hazardous
Materials on or from any property owned or operated by the Company or any of its
Subsidiaries, or any Environmental Liability related in any way to the Company
or any of its Subsidiaries, whether based on contract, tort or any other theory,
whether brought by a third party or by the Company or any other Loan Party, 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 (x) are determined
by a court of competent jurisdiction by final and nonappealable judgment to have
resulted from the gross negligence or willful misconduct of such Indemnitee or
(y) result from a claim brought by the Company or any other Loan Party
against an Indemnitee for breach in bad faith of such Indemnitee's obligations
hereunder or under any other Loan Document, if the Company or such Loan Party
has obtained a final and nonappealable judgment in its favor on such claim as
determined by a court of competent jurisdiction.

      
         

        
          
            
              

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

       

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

       

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

       

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

       

      11.05    
 Payments Set Aside.  To
the extent that the Company makes a payment to the Administrative Agent or the
Lenders, or the Administrative Agent or the Lenders exercise their right of
set-off, and such payment or the proceeds of such set-off or any part thereof
are subsequently invalidated, declared to be fraudulent or preferential, set
aside or required (including pursuant to any settlement entered into by the
Administrative Agent or such Lender in its discretion) to be repaid to a
trustee, receiver or any other party, in connection with any Insolvency
Proceeding or otherwise, then (a) to the extent of such recovery the obligation
or part thereof originally intended to be satisfied shall be revived and
continued in full force and effect as if such payment had not been made or such
set-off had not occurred, and (b) each Lender severally agrees to pay to the
Administrative Agent upon demand its Pro Rata Share of any amount so recovered
from or repaid by the Administrative Agent.

      
         

        
          
            
              

            
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      11.06    
 Successors and
Assigns.

       

      (a)           Successors and Assigns
Generally.  The provisions of this Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns permitted hereby, except that neither the Company nor any
other Loan Party may assign or otherwise transfer any of its rights or
obligations hereunder without the prior written consent of the Administrative
Agent and each Lender and no Lender may assign or otherwise transfer any of its
rights or obligations hereunder except (i) to an assignee in accordance with the
provisions of Section
11.06(b), (ii) by way of participation in accordance with the provisions
of Section
11.06(d)
or (iii) by way of pledge or assignment of a security interest subject to the
restrictions of Section
11.06(f)
(and any other attempted assignment or transfer by any party hereto shall be
null and void).  Nothing in this Agreement, expressed or implied,
shall be construed to confer upon any Person (other than the parties hereto,
their respective successors and assigns permitted hereby, Participants to the
extent provided in Section
11.06(d)
and, to the extent expressly contemplated hereby, the Related Parties of each of
the Administrative Agent and the Lenders) any legal or equitable right, remedy
or claim under or by reason of this Agreement.

       

      (b)           Assignments by
Lenders.  Any Lender may at any time assign to one or more
assignees all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Commitment and the Loans at the time owing to
it); provided
that any such assignment shall be subject to the following
conditions:

       

      (i)           Minimum
Amounts.

       

      (A)           in
the case of an assignment of the entire remaining amount of the assigning
Lender’s Commitment and the Loans at the time owing to it or in the case of an
assignment to a Lender, an Affiliate of a Lender or an Approved Fund, no minimum
amount need be assigned; and

       

      (B)           in
any case not described in Section
11.06(b)(i)(A),
the aggregate amount of the Commitment (which for this purpose includes Loans
outstanding thereunder) or, if the Commitment is not then in effect, the
principal outstanding balance of the Loans of the assigning Lender subject to
each such assignment (determined as of the date the Assignment and Assumption
with respect to such assignment is delivered to the Administrative Agent or, if
“Trade Date” is specified in the Assignment and Assumption, as of the Trade
Date) shall not be less than $5,000,000, unless each of the Administrative Agent
and, so long as no Event of Default has occurred and is continuing, the Company
otherwise consents (each such consent not to be unreasonably withheld or
delayed).

       

      (ii)           Proportionate
Amounts.  Each partial assignment shall be made as an
assignment of a proportionate part of all the assigning Lender’s rights and
obligations under this Agreement with respect to the Loan or the Commitment
assigned, except that this Section
11.06(b)(ii) shall not apply to Swing Line Lender’s rights and
obligations in respect of Swing Line Loans.

       

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

       

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

      
         

        
          
            
              

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

       

      (C)           the
consent of the Issuing Lender (such consent not to be unreasonably withheld or
delayed) shall be required for any assignment that increases the obligation of
the assignee to participate in exposure under one or more Letters of Credit
(whether or not then outstanding); and

       

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

       

      (iv)           Assignment and
Assumption.  The parties to each assignment shall execute and
deliver to the Administrative Agent an Assignment and Assumption, together with
a processing and recordation fee of $3,000.00 and the assignee, if it is not a
Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire.

       

      (v)           No Assignment to the
Company.  No such assignment shall be made to the Company or
any of the Company’s Affiliates or Subsidiaries.

       

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

       

      (vii)           Certain
Additional Payments.  In connection with any assignment of rights and
obligations of any Defaulting Lender hereunder, no such assignment shall be
effective unless and until, in addition to the other conditions thereto set
forth herein, the parties to the assignment shall make such additional payments
to the Administrative Agent in an aggregate amount sufficient, upon distribution
thereof as appropriate (which may be outright payment, purchases by the assignee
of participations or subparticipations, or other compensating actions, including
funding, with the consent of the Company and the Administrative Agent, the
applicable pro rata share of Loans previously requested but not funded by the
Defaulting Lender, to each of which the applicable assignee and assignor hereby
irrevocably consent), to (x) pay and satisfy in full all payment liabilities
then owed by such Defaulting Lender to the Administrative Agent or any Lender
hereunder (and interest accrued thereon) and (y) acquire (and fund as
appropriate) its full pro rata share of all Loans and participations in Letters
of Credit and Swing Line Loans in accordance with its Pro Rata
Share.  Notwithstanding the foregoing, in the event that any
assignment of rights and obligations of any Defaulting Lender hereunder shall
become effective under applicable Law without compliance with the provisions of
this paragraph, then the assignee of such interest shall be deemed to be a
Defaulting Lender for all purposes of this Agreement until such compliance
occurs.

       

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

      
         

        
          
            
              

            
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      (c)           Register.  The
Administrative Agent, acting solely for this purpose as an agent of the Company,
shall maintain at the Administrative Agent’s office listed on Schedule 11.02
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
Commitments of, and principal amounts 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 Company, the Administrative
Agent and the Lenders may treat each Person whose name is recorded in the
Register pursuant to the terms hereof as a Lender hereunder for all purposes of
this Agreement, notwithstanding notice to the contrary.  The Register
shall be available for inspection by the Company and any Lender, at any
reasonable time and from time to time upon reasonable prior notice.

       

      (d)           Participations.  Any
Lender may at any time, without the consent of, or notice to, the Company or the
Administrative Agent, sell participations to any Person (other than a natural
person or the Company or any of the Company’s Affiliates or Subsidiaries) (each,
a “Participant”)
in all or a portion of such Lender’s rights and/or obligations under this
Agreement (including all or a portion of its Commitment and/or the Loans owing
to it); provided that (i)
such Lender’s obligations under this Agreement shall remain unchanged, (ii) such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations and (iii) the Company, the Administrative Agent
and the Lenders, and Issuing Lender 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 Section
11.01 that
affects such Participant.  Subject to Section
11.06(e),
the Company agrees that each Participant shall be entitled to the benefits of
Sections
3.01, 3.03, and
3.07 to the same extent as
if it were a Lender and had acquired its interest by assignment pursuant to
Section
11.06(b).  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
2.12 as
though it were a Lender.

       

      (e)           Limitations upon Participant
Rights.  A Participant shall not be entitled to receive any
greater payment under Sections
3.01 and 3.03 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 Company’s prior written consent.  A
Participant that would be a Foreign Lender if it were a Lender shall not be
entitled to the benefits of Section
3.01 unless
the Company is notified of the participation sold to such Participant and such
Participant agrees, for the benefit of the Company, to comply with Section
3.01(e) as
though it were a Lender.

       

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

      
         

        
          
            
              

            
Second Amended and
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      11.07   
  Confidentiality.  Each
of the Administrative Agent, the Lenders and the Issuing Lender agrees to
maintain the confidentiality of the Information (as defined below), except that
Information may be disclosed (a) to its Affiliates and to its and its
Affiliates’ respective managers, administrators, trustees, partners, directors,
officers, employees, agents, advisors and other representatives (it being
understood that the Persons to whom such disclosure is made will be informed of
the confidential nature of such Information and instructed to keep such
Information confidential), (b) to the extent requested by any regulatory
authority purporting to have jurisdiction over it (including any self-regulatory
authority, such as the National Association of Insurance Commissioners), (c) to
the extent required by applicable laws or regulations or by any subpoena or
similar legal process, (d) to any other party hereto, (e) in connection with the
exercise of any remedies hereunder or under any other Loan Document or any
action or proceeding relating to this Agreement or any other Loan Document or
the enforcement of rights hereunder or thereunder, (f) subject to an agreement
containing provisions substantially the same as those of this Section, to (i)
any assignee of or Participant in, or any prospective assignee of or Participant
in, any of its rights or obligations under this Agreement or (ii) any actual or
prospective counterparty (or its managers, administrators, trustees, partners,
directors, officers, employees, agents, advisors and other representatives) to
any swap or derivative or similar transaction under which payments are to be
made by reference relating to Parent, the Company or any Guarantor and their
respective obligations, this Agreement or payments hereunder, (iii) any rating
agency, or (iv) the CUSIP Service Bureau or any similar organization, (g) with
the consent of the Company, or (h) to the extent such Information (x) becomes
publicly available other than as a result of a breach of this Section or (y)
becomes available to the Administrative Agent, any Lender, the Issuing Lender or
any of their respective Affiliates on a nonconfidential basis from a source
other than the Company.

       

      For
purposes of this Section, “Information” means all information received from the
Company or any of its Subsidiaries relating to Parent, the Company or any of its
Subsidiaries or any of their respective businesses, other than any such
information that is available to the Administrative Agent, any Lender or the
Issuing Lender on a nonconfidential basis prior to disclosure by the Company or
any of its Subsidiaries.  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.

       

      11.08  
   Right of Set-off.  Subject to Section
9.04, if an Event of Default shall have occurred and be continuing, each
Lender, the Issuing Lender, and each of their respective Affiliates is hereby
authorized at any time and from time to time, after obtaining the prior written
consent of the Administrative Agent, to the fullest extent permitted by
applicable law, to set off and apply any and all deposits (general or special,
time or demand, provisional or final, in whatever currency) at any time held and
other obligations (in whatever currency) at any time owing by such Lender, the
Issuing Lender or any such Affiliate to or for the credit or the account of the
Company or any other Loan Party against any and all of the obligations of the
Company or such Loan Party now or hereafter existing under this Agreement or any
other Loan Document to such Lender or the Issuing Lender, irrespective of
whether or not such Lender or the Issuing Lender shall have made any demand
under this Agreement or any other Loan Document and although such obligations of
the Company or such Loan Party may be contingent or unmatured or are owed to a
branch or office of such Lender or the Issuing Lender different from the branch
or office holding such deposit or obligated on such indebtedness provided, that
in the event that any Defaulting Lender shall exercise any such right of setoff,
all amounts so set off shall be paid over immediately to the Administrative
Agent for further application in accordance with the provisions of Section
2.15(c) and, pending such payment, shall be segregated by such Defaulting
Lender from its other funds and deemed held in trust for the benefit of the
Administrative Agent and the Lenders.  The rights of each Lender, the
Issuing Lender and their respective Affiliates under this Section 11.08
are in addition to other rights and remedies (including other rights of
setoff) that such Lender, the Issuing Lender or their respective Affiliates may
have.  Each Lender and the Issuing Lender agrees to notify the Company
and the Administrative Agent promptly after any such setoff and application,
provided that the failure to give such notice shall not affect the validity of
such setoff and application.

       

      
        
          
            
              

            
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      11.09  
   Interest.  It
is the intention of the parties hereto to comply with applicable usury laws, if
any; accordingly, notwithstanding any provision to the contrary in this
Agreement, the Notes or in any of the other Loan Documents securing the payment
hereof or otherwise relating hereto, in no event shall this Agreement, the Notes
or such other Loan Documents require or permit the payment, taking, reserving,
receiving, collection, or charging of any sums constituting interest under
applicable laws which exceed the maximum amount permitted by such
laws.  If any such excess interest is called for, contracted for,
charged, taken, reserved, or received in connection with the Loans evidenced by
the Notes or in any of the Loan Documents securing the payment thereof or
otherwise relating thereto, or in any communication by the Administrative Agent,
the Issuing Lender or the Lenders or any other Person to the Company or any
other Person, or in the event all or part of the principal or interest thereof
shall be prepaid or accelerated, so that under any of such circumstances or
under any other circumstance whatsoever the amount of interest contracted for,
charged, taken, reserved, or received on the amount of principal actually
outstanding from time to time under the Notes or any other Loan Document shall
exceed the maximum amount of interest permitted by applicable usury laws, then
in any such event it is agreed as follows:  (i) the provisions of this
paragraph shall govern and control, (ii) neither any Company nor any other
Person now or hereafter liable for the payment of the Notes or any Obligation
shall be obligated to pay the amount of such interest to the extent such
interest is in excess of the maximum amount of interest permitted by applicable
usury laws, (iii) any such excess which is or has been received notwithstanding
this paragraph shall be credited against the then unpaid principal balance of
the Notes or other Obligations, as applicable, or, if the Notes or other
Obligations, as applicable, have been or would be paid in full, refunded to the
Company, and (iv) the provisions of this Agreement, the Notes and the other Loan
Documents securing the payment thereof and otherwise relating thereto, and any
communication to the Company, shall immediately be deemed reformed and such
excess interest reduced, without the necessity of executing any other document,
to the maximum lawful rate allowed under applicable laws as now or hereafter
construed by courts having jurisdiction hereof or thereof.  Without
limiting the foregoing, all calculations of the rate of the interest contracted
for, charged, collected, taken, reserved, or received in connection with the
Notes, this Agreement or any other Loan Document which are made for the purpose
of determining whether such rate exceeds the maximum lawful rate shall be made
to the extent permitted by applicable laws by amortizing, prorating, allocating
and spreading during the period of the full term of the Loans or other
Obligations, as applicable, including all prior and subsequent renewals and
extensions, all interest at any time contracted for, charged, taken, collected,
reserved, or received.  The terms of this paragraph shall be deemed to
be incorporated in every document and communication relating to the Notes, the
Loans or any other Loan Document.

       

      11.10 
    Indemnity and Subrogation.  In
addition to all such rights of indemnity and subrogation as any Guarantor may
have under applicable law, the Company agrees that in the event a payment shall
be made by any Guarantor under a Guaranty in respect of a Loan to the Company
the Company shall indemnify such Guarantor for the full amount of such payment
and such Guarantor shall be subrogated to the rights of the person to whom such
payment shall have been made to the extent of such payment subject to the
provisions of the Guaranty executed by such Guarantor. Notwithstanding any
provision of this Agreement to the contrary, all rights of any Guarantor under
this Section
11.10 and all other rights of indemnity, contribution or subrogation
under applicable law or otherwise shall be fully subordinated to the payment in
full of the Obligations, and no payments may be made in respect of such rights
of indemnity, contribution or subrogation until all the Obligations have been
paid in full and all Commitments have expired. No failure on the part of the
Company to make the payments required by this Section
11.10 (or
any other payments required under applicable law or otherwise) shall in any
respect limit the obligations and liability of any Guarantor with respect to any
Guaranty, and Guarantor shall remain liable for the full amount of the
obligation of such Guarantor under each such Guaranty in accordance
therewith.

      
         

        
          
            
              

            
Second Amended and
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      11.11  
   Collateral Matters; Derivative Contracts; Termination.

       

      (a)           The
benefit of the Security Documents and of the provisions of this Agreement
relating to any collateral securing the Obligations shall also extend to and be
available to  any Lender or any Affiliate of a Lender that is
counterparty to any Derivative Contract (including the Derivative Contracts
listed on Schedule
6.21) with any Loan Party or any of their Subsidiaries, on a pro rata basis, in respect of
any obligations of the Loan Parties and their Subsidiaries which arise under any
such Derivative Contract; provided that if such
Lender or Affiliate ceases to be a Lender or an Affiliate of a Lender such
Derivative Contract obligations shall be secured pari passu with the
Obligations of the Loan Parties under this Agreement and the other Loan
Documents  but only to the extent such Derivative Contract obligations
arise under Derivative Contracts (including the Derivative Contracts listed on
Schedule
6.21) that are entered into at the time such counterparty was a Lender
hereunder or an Affiliate of a Lender hereunder.

       

      (b)           Such
counterparty shall have no voting rights under any Loan Documents as a result of
the existence of obligations owed to it under any such Derivative
Contract.  For the avoidance of doubt, a Person ceases to be a Lender
hereunder if (i) pursuant to an assignment, such Person ceases to have any
Commitment, Loans or LC Obligation hereunder or (ii) the Commitments of all of
the Lenders hereunder have been terminated and all principal, interest and other
amounts outstanding under this Agreement have been paid in full in cash (whether
as a result of repayment at maturity, prepayment in connection with the
refinancing of this Agreement or otherwise).

       

      (c)           If
the Obligations are paid and satisfied in full, including all Obligations
arising under Lender Derivative Contracts, all Commitments of the Lenders have
terminated and are no longer in effect, no Letters of Credit remain outstanding,
and no Lender Derivative Contracts remain outstanding, the Administrative Agent
and the Lenders shall execute and deliver or cause to be executed and delivered
such instruments of satisfaction and reassignment as may be appropriate in order
to release all liens and security interests created by the Security Instruments;
provided, however, that in lieu of terminating and repaying any such Obligations
arising under any Lender Derivative Contracts with any Lender Derivative
Provider, the Company may provide substitute credit support under a standard
form ISDA Credit Support Annex or other credit support documents acceptable to
such Lender Derivative Provider, to cover its then current exposure under such
Lender Derivative Contract and such Lender Derivative Provider shall provide
written notice to the Administrative Agent to the effect that such substitute
credit support has been provided to it and that such Lender Derivative Provider
no longer claims any right, title or interest in any collateral security arising
under the Loan Documents to secure any obligations or indebtedness of Company or
any of its Subsidiaries arising under or related to such Lender Derivative
Contract.

       

      11.12  
   Renewal and
Continuation of Existing Indebtedness.

       

      (a)           All
Obligations under the Notes are in renewal, extension and modification, but not
novation or discharge of the “Obligations” as defined in the Existing Credit
Agreement.  All liens and security interests under the Security
Documents are in renewal, amendment and extension of the Liens created under the
Existing Credit Agreement and “Security Documents” executed in connection
therewith.

       

      (b)           The
Company shall pay to each Lender under the Existing Credit Agreement within
thirty (30) days of receipt of written request of such Lender (which request
shall set forth, in reasonable detail, the basis for requesting such amounts)
such amount or amounts as shall be due pursuant to Section
3.04 of the Existing Credit Agreement which are attributed to prepayment
of LIBOR Loans under the Existing Credit Agreement being prepaid from the
proceeds of the initial funding of Loans hereunder.

      
         

        
          
            
              

            
Second Amended and
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      (c)           The
Lenders waive any notice of prepayment required pursuant to Section
2.04 of the Existing
Credit Agreement in respect of the prepayment of Loans on the Effective Date
hereunder.

       

      11.13    
 USA Patriot Act Notice.  Each
Lender hereby notifies the Loan Parties that pursuant to the requirements of the
USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001))
(the “Act”), it
is required to obtain, verify and record information that identifies such Loan
Party, which information includes the name and address of such Loan Party and
other information that will allow such Lender to identify the Loan Party,
insofar as it is needed to comply with the Act, in accordance with the Act. Each
Loan Party hereby represents and warrants to Administrative Agent and each
Lender that such Loan Party is not a country, individual or entity named on the
“Specifically Designated
National and Blocked Persons” list issued by the Office of Foreign Asset
Control of the Department of the Treasury of the United States of
America.

       

      11.14   
  Automatic Debits of Fees.  With
respect to any commitment fee, arrangement fee, letter of credit fee or other
fee, or any other cost or expense due and payable to the Administrative Agent
under the Loan Documents (including attorneys fees and expenses that are payable
pursuant to this Agreement or the other Loan Documents), the Company hereby
irrevocably authorizes the Administrative Agent, after giving reasonable prior
notice to the Company, to debit any deposit account of the Company with the
Administrative Agent in an amount such that the aggregate amount debited from
all such deposit accounts does not exceed such fee or other cost or
expense.  If there are insufficient funds in such deposit accounts to
cover the amount of the fee or other cost or expense then due, such debits will
be reversed (in whole or in part, in the Administrative Agent’s sole discretion)
and such amount not debited shall be deemed to be unpaid.  No such
debit under this Section shall be deemed a set-off.

       

      11.15  
   Counterparts.  This
Agreement may be executed in any number of separate counterparts, each of which,
when so executed, shall be deemed an original, and all of said counterparts
taken together shall be deemed to constitute but one and the same
instrument.

       

      11.16 
    Severability.  The
illegality or unenforceability of any provision of this Agreement or any
instrument or agreement required hereunder shall not in any way affect or impair
the legality or enforceability of the remaining provisions of this Agreement or
any instrument or agreement required hereunder.

       

      11.17 
    No Third Parties Benefited.  This
Agreement is made and entered into for the sole protection and legal benefit of
the Company, the other Loan Parties, the Lenders, the Administrative Agent, the
Indemnitees, and their permitted successors and assigns, and no other Person
shall be a direct or indirect legal beneficiary of, or have any direct or
indirect cause of action or claim in connection with, this Agreement or any of
the other Loan Documents.

       

      11.18 
    Entire Agreement.  This
Agreement, together with the other Loan Documents, embodies the entire agreement
and understanding among the Loan Parties, the Lenders and the Administrative
Agent, and supersedes all prior or contemporaneous agreements and understandings
of such Persons, verbal or written, relating to the subject matter hereof and
thereof. The Existing Credit Agreement is amended and restated in its entirety
by this Agreement and upon the effectiveness hereof, all terms and provisions of
this Agreement shall supersede the terms and provisions of the Existing Credit
Agreement.

       

      11.19    
 Governing Law, Jurisdiction and Waiver of Jury Trial.

       

      (a)           THIS
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE
STATE OF NEW YORK AND APPLICABLE FEDERAL LAW; AND THE ADMINISTRATIVE AGENT AND
THE LENDERS SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.

       

      
        
          
            

          
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      (b)           EACH
PARTY HERETO IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS IN ANY LEGAL ACTION
OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT BY THE
MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO
ITS ADDRESS SET FORTH FOR NOTICES PURSUANT TO SECTION
11.02.  SUCH SERVICE TO BECOME EFFECTIVE TEN DAYS AFTER SUCH
MAILING. NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE ADMINISTRATIVE AGENT OR
ANY LENDER TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.

       

      (c)           ANY
LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK SITTING IN NEW
YORK COUNTY OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK, AND
BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH LOAN PARTY CONSENTS, FOR
ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF
THOSE COURTS.  EACH LOAN PARTY IRREVOCABLY WAIVES ANY OBJECTION,
INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM
NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION
OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT
RELATED HERETO.  EACH LOAN PARTY WAIVES PERSONAL SERVICE OF ANY
SUMMONS, COMPLAINT OR OTHER PROCESS, AND CONSENTS TO THE SERVICE OF PROCESS IN
ANY SUCH LEGAL ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY
REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO IT AT ITS ADDRESS FOR NOTICES
SET FORTH HEREIN, SUCH SERVICE TO BECOME EFFECTIVE TEN DAYS AFTER SUCH
MAILING.  NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE ADMINISTRATIVE
AGENT OR ANY LENDER TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY
LAW.

       

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

       

      11.20    
 California Judicial Reference.  If
any action or proceeding is filed in a court of the State of California by or
against any party hereto in connection with any of the transactions contemplated
by this Agreement or any other Loan Document, (a) the court shall, and is hereby
directed to, make a general reference pursuant to California Code of Civil
Procedure Section 638 to a referee (who shall be a single active or retired
judge) to hear and determine all of the issues in such action or proceeding
(whether of fact or of law) and to report a statement of decision, provided that
at the option of any party to such proceeding, any such issues pertaining to a
“provisional remedy” as defined in California Code of Civil Procedure Section
1281.8 shall be heard and determined by the court, and (b) without limiting the
generality of Section
10.04, the Company shall be solely responsible to pay all fees and
expenses of any referee appointed in such action or proceeding.

      
        
           

          
            

          
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      11.21   
  NO ORAL AGREEMENTS.  THIS
WRITTEN LOAN AGREEMENT, TOGETHER WITH THE OTHER WRITTEN LOAN DOCUMENTS EXECUTED
IN CONNECTION HEREWITH, REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND
MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES.

       

      THERE ARE
NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

       

      [THE
REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

       

      
        
          
            

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

       

      
        
          
            
              
                
                  
                    
                      	 
      	
                              THE
      COMPANY:

                            
	 
      	 
      
	 
      	
                              BREITBURN
      OPERATING L.P.,

                            
	 
      	
                              a
      Delaware limited partnership

                            
	 
      	 
      
	 
      	
                              By:

                            	
                              BreitBurn
      Operating GP, LLC its general partner

                            
	 
      	 
      	 
      
	 
      	
                              By:

                            	 
      
	 
      	
                              Name:

                            	 
      
	 
      	
                              Title:

                            	 
      
	 
      	 
      
	 
      	
                              PARENT:

                            
	 	 
	 
      	
                              BREITBURN
      ENERGY PARTNERS, L.P.,

                            
	 
      	
                              a
      Delaware limited partnership

                            
	 
      	 
      
	 
      	
                              By:  BreitBurn
      GP, LLC its general partner

                            
	 
      	 
      
	 
      	
                              By:

                            	 
      
	 
      	
                              Name:

                            	 
      
	 
      	
                              Title:

                            	 
      

                    

                  

                

              

            

          

        

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    
      
        
          
            
              	
                      WELLS FARGO BANK, NATIONAL
      ASSOCIATION, as Administrative Agent, Issuing Lender and a
      Lender

                    
	 
      	 
      
	
                      By:

                    	
                            
                           
      

                      

                    
	 
      	
                      Richard
      A. Gould

                    
	 
      	
                      Managing
      Director

                    

            

          

        

      

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      
        
          
            	
                    BANK OF MONTREAL, as
      Co-Syndication Agent and a Lender

                  
	 
      	 
      
	
                    By:

                  	 
      
	
                    Name:

                  
	
                    Title:

                  

          

        

      

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      
        
          
            	
                    THE BANK OF NOVA SCOTIA,
      HOUSTON BRANCH, as Co-Syndication Agent and a
  Lender

                  
	 
      	 
      
	
                    By:

                  	 
      
	
                    Name:

                  
	
                    Title:

                  

          

        

      

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      
        
          
            	
                    BNP PARIBAS, as
      Co-Documentation Agent and a Lender

                  
	 
      	 
      
	
                    By:

                  	 
      
	
                    Name:

                  
	
                    Title:

                  

          

        

      

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      
        
          
            
              
                
                  	
                          UNION BANK, N.A., as
      Co-Documentation Agent and a Lender

                        
	 
      	 
      
	
                          By:

                        	 
      
	
                          Name:

                        
	
                          Title:

                        

                

              

            

          

        

      

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      
        
          	
                  CITIBANK, N.A., as a
      Lender

                
	 
      	 
      
	
                  By:

                	 
      
	
                  Name:

                
	
                  Title:

                

        

      

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      
        
          	
                  ROYAL BANK OF CANADA, as
      a Lender

                
	 
      	 
      
	
                  By:

                	 
      
	
                  Name:

                
	
                  Title:

                

        

      

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      
        
          	
                  U.S. BANK NATIONAL
      ASSOCIATION, as a Lender

                
	 
      	 
      
	
                  By:

                	 
      
	
                  Name:

                
	
                  Title:

                

        

      

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      
        
          	
                  BANK OF SCOTLAND PLC, as a
      Lender

                
	 
      	 
      
	
                  By:

                	 
      
	
                  Name:

                
	
                  Title:

                

        

      

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      
        
          	
                  THE ROYAL BANK OF SCOTLAND
      PLC, as a
      Lender

                
	 
      	 
      
	
                  By:

                	 
      
	
                  Name:

                
	
                  Title:

                

        

      

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      
        
          	
                  BARCLAYS BANK PLC, as a
      Lender

                
	 
      	 
      
	
                  By:

                	 
      
	
                  Name:

                
	
                  Title:

                

        

      

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      
        
          	
                  CREDIT SUISSE, CAYMAN ISLANDS
      BRANCH, as a Lender

                
	 
      	 
      
	
                  By:

                	 
      
	
                  Name:

                
	
                  Title:

                

        

      

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      
        
          	
                  TORONTO DOMINION (TEXAS)
      LLC, as a Lender

                
	 
      	 
      
	
                  By:

                	 
      
	
                  Name:

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

                
	 
      	 
      
	
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                  SUMITOMO MITSUI BANKING
      CORPORATION, as a Lender

                
	 
      	 
      
	
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                  Name:

                
	
                  Title:

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00173-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00173-of-00352.parquet"}]]