Document:

exv10w1

 

EXHIBIT 10.1

$175,000,000 Revolving Loan

CREDIT AGREEMENT

dated as of

October 29, 2004

among

NRP (OPERATING) LLC,

as Borrower

The Lenders Party Hereto

and

CITIBANK, N.A.,

as Administrative Agent

CITIGROUP GLOBAL MARKETS, INC. and WACHOVIA CAPITAL MARKETS, LLC

as Joint Lead Arrangers and Joint Bookrunners

WACHOVIA BANK, NATIONAL ASSOCIATION

as Syndication Agent

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page

	ARTICLE I DEFINITIONS
	 	 	1	 
	SECTION 1.01. Defined Terms
	 	 	1	 
	SECTION 1.02. Classification of Loans and Borrowings
	 	 	16	 
	SECTION 1.03. Terms Generally
	 	 	16	 
	SECTION 1.04. Accounting Terms; GAAP
	 	 	17	 
	ARTICLE II THE CREDITS
	 	 	17	 
	SECTION 2.01. Commitments
	 	 	17	 
	SECTION 2.02. Loans and Borrowings
	 	 	17	 
	SECTION 2.03. Requests for Revolving Borrowings
	 	 	18	 
	SECTION 2.04. Intentionally Deleted
	 	 	18	 
	SECTION 2.05. Intentionally Deleted
	 	 	18	 
	SECTION 2.06. Letters of Credit
	 	 	18	 
	SECTION 2.07. Funding of Borrowings
	 	 	23	 
	SECTION 2.08. Interest Elections
	 	 	23	 
	SECTION 2.09. Termination and Reduction of Commitments
	 	 	24	 
	SECTION 2.10. Repayment of Loans; Evidence of Debt
	 	 	25	 
	SECTION 2.11. Prepayment of Loans
	 	 	25	 
	SECTION 2.12. Fees
	 	 	26	 
	SECTION 2.13. Interest
	 	 	27	 
	SECTION 2.14. Alternate Rate of Interest
	 	 	27	 
	SECTION 2.15. Increased Costs
	 	 	28	 
	SECTION 2.16. Break Funding Payments
	 	 	29	 
	SECTION 2.17. Taxes
	 	 	29	 
	SECTION 2.18. Payments Generally; Pro Rata Treatment; Sharing of Set-offs
	 	 	30	 
	SECTION 2.19. Mitigation Obligations; Replacement of Lenders
	 	 	32	 
	SECTION 2.20. Increase of Commitments
	 	 	32	 
	ARTICLE III REPRESENTATIONS AND WARRANTIES
	 	 	34	 
	SECTION 3.01. Organization; Powers
	 	 	34	 
	SECTION 3.02. Authorization; Enforceability
	 	 	34	 
	SECTION 3.03. No Undisclosed Liabilities
	 	 	34	 
	SECTION 3.04. Governmental Approvals; No Conflicts
	 	 	34	 
	SECTION 3.05. Financial Condition; No Material Adverse Change
	 	 	35	 
	SECTION 3.06. Properties
	 	 	35	 
	SECTION 3.07. Litigation and Environmental Matters
	 	 	35	 
	SECTION 3.08. Compliance with Laws and Agreements
	 	 	35	 
	SECTION 3.09. Investment and Holding Company Status
	 	 	35	 
	SECTION 3.10. Taxes
	 	 	36	 
	SECTION 3.11. ERISA
	 	 	36	 
	SECTION 3.12. Disclosure
	 	 	36	 
	SECTION 3.13. Labor Matters
	 	 	36	 
	SECTION 3.14. Subsidiaries
	 	 	36	 

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	 	 	Page

	SECTION 3.15. Margin Stock
	 	 	36	 
	SECTION 3.16. Licenses and Permits
	 	 	37	 
	SECTION 3.17. Reportable Transaction
	 	 	37	 
	SECTION 3.18. Public Utility Holding Company Act
	 	 	37	 
	SECTION 3.19. Senior Debt Status
	 	 	37	 
	SECTION 3.20. Leases
	 	 	37	 
	SECTION 3.21. Solvency
	 	 	37	 
	SECTION 3.22. Foreign Assets Control Regulation
	 	 	37	 
	SECTION 3.23. Representations Regarding the Parent
	 	 	38	 
	ARTICLE IV CONDITIONS
	 	 	38	 
	SECTION 4.01. Effective Date
	 	 	38	 
	SECTION 4.02. Each Credit Event
	 	 	39	 
	ARTICLE V AFFIRMATIVE COVENANTS
	 	 	40	 
	SECTION 5.01. Financial Statements; Ratings Change and Other Information
	 	 	40	 
	SECTION 5.02. Notices of Material Events
	 	 	41	 
	SECTION 5.03. Existence; Conduct of Business
	 	 	41	 
	SECTION 5.04. Payment of Obligations
	 	 	41	 
	SECTION 5.05. Maintenance of Properties; Insurance
	 	 	42	 
	SECTION 5.06. Books and Records; Inspection Rights
	 	 	42	 
	SECTION 5.07. Compliance with Laws
	 	 	42	 
	SECTION 5.08. Use of Proceeds and Letters of Credit
	 	 	42	 
	SECTION 5.09. Compliance with ERISA
	 	 	42	 
	SECTION 5.10. Intentionally Deleted
	 	 	42	 
	SECTION 5.11. Compliance with Environmental Laws; Environmental Reports
	 	 	43	 
	SECTION 5.12. Further Assurances
	 	 	43	 
	SECTION 5.13. Tax Shelter Regulations
	 	 	43	 
	SECTION 5.14. Leases; Material Contracts
	 	 	43	 
	SECTION 5.15. Clean-Down Period
	 	 	43	 
	SECTION 5.16. Guaranties
	 	 	43	 
	ARTICLE VI NEGATIVE COVENANTS
	 	 	44	 
	SECTION 6.01. Indebtedness
	 	 	44	 
	SECTION 6.02. Liens
	 	 	44	 
	SECTION 6.03. Fundamental Changes
	 	 	46	 
	SECTION 6.04. Investments, Loans, Advances and Guarantees
	 	 	46	 
	SECTION 6.05. Swap Agreements
	 	 	47	 
	SECTION 6.06. Restricted Payments
	 	 	47	 
	SECTION 6.07. Transactions with Affiliates
	 	 	47	 
	SECTION 6.08. Sales of Assets
	 	 	47	 
	SECTION 6.09. Constituent Documents
	 	 	48	 
	SECTION 6.10. Regulation T, U and X Compliance
	 	 	48	 
	SECTION 6.11. Sales and Leasebacks
	 	 	48	 
	SECTION 6.12. Changes in Fiscal Year
	 	 	48	 
	SECTION 6.13. Change in the Nature of Business
	 	 	48	 

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	 	 	Page

	SECTION 6.14. Limitation on Restrictions on Subsidiary Distributions
	 	 	48	 
	SECTION 6.15. Changes to the Omnibus Agreement
	 	 	49	 
	SECTION 6.16. Changes to the Note Purchase Agreement
	 	 	49	 
	SECTION 6.17. Minimum Interest Coverage Ratio
	 	 	49	 
	SECTION 6.18. Maximum Leverage Ratio
	 	 	49	 
	SECTION 6.19. Permitted Acquisitions
	 	 	49	 
	ARTICLE VII EVENTS OF DEFAULT
	 	 	50	 
	ARTICLE VIII THE ADMINISTRATIVE AGENT
	 	 	52	 
	ARTICLE IX MISCELLANEOUS
	 	 	54	 
	SECTION 9.01. Notices
	 	 	54	 
	SECTION 9.02. Waivers; Amendments
	 	 	55	 
	SECTION 9.03. Expenses; Indemnity; Damage Waiver
	 	 	56	 
	SECTION 9.04. Successors and Assigns
	 	 	57	 
	SECTION 9.05. Survival
	 	 	60	 
	SECTION 9.06. Counterparts; Integration; Effectiveness
	 	 	60	 
	SECTION 9.07. Severability
	 	 	60	 
	SECTION 9.08. Right of Setoff
	 	 	61	 
	SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of Process
	 	 	61	 
	SECTION 9.10. WAIVER OF JURY TRIAL
	 	 	61	 
	SECTION 9.11. Headings
	 	 	62	 
	SECTION 9.12. Confidentiality
	 	 	62	 
	SECTION 9.13. Interest Rate Limitation
	 	 	62	 
	SECTION 9.14. USA PATRIOT ACT
	 	 	62	 
	SECTION 9.15. Separateness
	 	 	63	 
	SECTION 9.16. No Personal Liability of Directors, Officers, Employees and
Unitholders
	 	 	63	 
	SCHEDULES:
	 	 	 	 
	Schedule 2.01 — Commitments
	 	 	 	 
	Schedule 3.03 — Disclosed Matters
	 	 	 	 
	Schedule 3.14 — Subsidiaries
	 	 	 	 
	Schedule 6.01 — Existing Indebtedness
	 	 	 	 
	Schedule 6.02 — Existing Liens
	 	 	 	 
	Schedule 6.08 — Permitted Asset Sales
	 	 	 	 
	Schedule 6.14 — Existing Restrictions
	 	 	 	 
	EXHIBITS:
	 	 	 	 
	Exhibit A — Form of Assignment and Assumption
	 	 	 	 
	Exhibit B — Form of Commitment Increase Notice
	 	 	 	 
	Exhibit C — Form of New Lender Agreement
	 	 	 	 
	Exhibit D — Form of Guaranty Agreement (Subsidiary)
	 	 	 	 
	Exhibit E — Form of Borrowing Request
	 	 	 	 
	Exhibit F — Form of Compliance Certificate
	 	 	 	 

iii

 

          CREDIT AGREEMENT (this “Agreement”) dated as of October 29, 2004, among
NRP (OPERATING) LLC, the LENDERS party hereto, and CITIBANK, N.A., as
Administrative Agent.

          The parties hereto agree as follows:

ARTICLE I

Definitions

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

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

          “Acquisition” shall have the meaning set forth in Section 6.18.

          “Adjusted LIBO Rate” means, with respect to any Eurodollar Borrowing for
any Interest Period, an interest rate per annum (rounded upwards, if necessary,
to the next 1/16 of 1%) equal to (a) the LIBO Rate for such Interest Period
multiplied by (b) the Statutory Reserve Rate.

          “Administrative Agent” means Citibank, N.A., in its capacity as
administrative agent for the Lenders hereunder.

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

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

          “Agent Parties” shall have the meaning set forth in Section 9.01(c).

          “Agreement” shall have the meaning set forth in the introductory paragraph
hereof.

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

          “Applicable Percentage” means, with respect to any Lender, the percentage
of the total Commitments represented by such Lender’s Commitment. If the
Commitments have terminated or expired, the Applicable Percentages shall be
determined based upon the Commitments most recently in effect, giving effect to
any assignments.

          “Applicable Rate” means, for any day during any period between two
successive Financial Statement Delivery Dates commencing on the first Financial
Statement Delivery Date in such period and ending on the day before the following Financial Statement
Delivery Date, with respect to any

 

 

ABR Loan, Eurodollar Revolving Loan, or with
respect to the commitment fees payable hereunder, as the case may be, the
applicable margin per annum set forth in the appropriate column below under the
caption “ABR Spread,” “Eurodollar Spread” or “Commitment Fee Rate,” as the case
may be, for the Leverage Ratio for the fiscal period for which such financial
statements were delivered as of the Financial Statement Delivery Date:

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	ABR	 	Eurodollar	 	Commitment Fee
	Leverage Ratio:
	 	Spread
	 	Spread
	 	Rate

	Less than 2.0:1.0
	 	 	0.25	%	 	 	1.25	%	 	 	0.30	%
	Greater than or equal to 2.0:1.0 but less than 2.5:1.0
	 	 	0.50	%	 	 	1.50	%	 	 	0.35	%
	Greater than or equal to 2.5:1.0 but less than 3.75:1.0
	 	 	0.75	%	 	 	1.75	%	 	 	0.40	%
	Greater than 3.75:1.00
	 	 	1.00	%	 	 	2.00	%	 	 	0.40	%

          For purposes of the foregoing, (a) if sufficient information does not
exist to calculate the Applicable Rate, or the Borrower has not delivered such
information to the Administrative Agent in a timely manner, Eurodollar
Borrowings shall not be available to the Borrower and the Applicable Rate for
ABR Loans shall be 1.00% per annum and for the commitment fee shall be .40% per
annum; and (b) if the Leverage Ratio shall change upon delivery of any
financial statements required under Section 5.01, such change in the Applicable
Rate shall be effective as of the date on which any such financial statement is
delivered, irrespective of whether it is in the middle of an Interest Period or
when notice of such change shall have been furnished by the Borrower to the
Administrative Agent and the Lenders pursuant to Section 5.01 hereof or
otherwise. Each change in the Applicable Rate shall apply during the period
commencing on the effective date of such change and ending on the date
immediately preceding the effective date of the next such change.
Notwithstanding the above, the Applicable Rate from the Effective Date through
the first Financial Statement Delivery Date shall be 0.25% for ABR Loans, 1.25%
for Eurodollar Revolving Loans and 0.30% with respect to the commitment fee.

          “Approved Fund” has the meaning assigned to such term in Section 9.04.

          “Assessment Rate” means, for any day, the annual assessment rate in effect
on such day that is payable by a member of the Bank Insurance Fund classified
as “well-capitalized” and within supervisory subgroup “B” (or a comparable
successor risk classification) within the meaning of 12 C.F.R. Part 327 (or any
successor provision) to the Federal Deposit Insurance Corporation for insurance
by such Corporation of time deposits made in dollars at the offices of such
member in the United States; provided that if, as a result of any change in any
law, rule or regulation, it is no longer possible to determine the Assessment
Rate as aforesaid, then the Assessment Rate shall be such annual rate as shall
be determined by the Administrative Agent to be representative of the cost of
such insurance to the Lenders.

          “Assignment and Assumption” means an assignment and assumption entered
into by a Lender and an assignee (with the consent of any party whose consent
is required by Section 9.04), and accepted by the Administrative Agent, in the
form of Exhibit A or any other form approved by the Administrative Agent.

          “Available Cash” has the meaning set forth in the Partnership Agreement.

          “Availability Period” means the period from and including the Effective
Date to but excluding the earlier of the Maturity Date and the date of
termination of the Commitments.

          “Base CD Rate” means the sum of (a) the Three-Month Secondary CD Rate
multiplied by the Statutory Reserve Rate plus (b) the Assessment Rate.

2

 

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

          “Borrower” means NRP (Operating) LLC, a Delaware limited liability
company.

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

          “Borrowing Request” means a request by the Borrower for a Borrowing in
accordance with Section 2.03 and made in a form substantially similar to the
form attached hereto as Exhibit E attached hereto and incorporated herein by
reference.

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

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

          “Change in Control” means the occurrence of any of the following events:
(a) Corbin J. Robertson, Jr., WPP Group and/or one or more of their direct or
indirect, wholly-owned subsidiaries cease to own and control more than 50% of
the general partnership interests of the General Partner or otherwise cease to
Control the General Partner; (b) the General Partner shall cease to own and
control, of record and beneficially, directly, 100% of the general partner
interests in the Parent; (c) the Parent shall cease to own and control, of
record and beneficially, 100% of the membership interests of the Borrower; or
(d) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d)
under the Exchange Act), other than Corbin J. Robertson, Jr., WPP Group and/or
one or more of their direct or indirect, wholly-owned subsidiaries, shall
become, or obtain rights (whether by means or warrants, options or otherwise)
to become, the “beneficial owner” (as defined in Rules 13(d)-3 and 13(d)-5
under the Exchange Act) directly or indirectly, of, in the aggregate, more than
20% of the total number of Outstanding Units our Outstanding Partnership
Securities (as defined in the Partnership Agreement).

          “Change in Law” means (a) the adoption of any law, rule or regulation
after the date of this Agreement, (b) any change in any law, rule or regulation
or in the interpretation or application thereof by any Governmental Authority
after the date of this Agreement or (c) compliance by any Lender or the Issuing
Bank (or, for purposes of Section 2.15(b), by any lending office of such Lender
or by such Lender’s or the Issuing Bank’s holding company, if any) with any
request, guideline or directive (whether or not having the force of law) of any
Governmental Authority made or issued after the date of this Agreement.

          “Class”, when used in reference to any Loan or Borrowing, refers to such
Loan, or the Loans comprising such Borrowing, as Revolving Loans.

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

          “Commitment” means, with respect to each Lender, the commitment of such
Lender to make Revolving Loans and to acquire participations in Letters of
Credit hereunder, expressed as an

3

 

amount representing the maximum aggregate
amount of such Lender’s Revolving Credit Exposure hereunder, as such commitment
may be (a) reduced from time to time pursuant to Section 2.09, (b) increased
from time to time pursuant to Section 2.20, and (c) reduced or increased from
time to time pursuant to assignments by or to such Lender pursuant to Section
9.04. The initial amount of each Lender’s Commitment is set forth on Schedule
2.01, or in the Assignment and Assumption pursuant to which such Lender shall
have assumed its Commitment, as applicable. The initial aggregate amount of
the Lenders’ Commitments is $175,000,000.

          “Commitment Increase Notice” has the meaning assigned to such term in
Section 2.20.

          “Commitment Increase Agreement” has the meaning assigned to such term in
Section 2.20.

          “Communications” has the meaning assigned to such term in Section 9.01(c).

          “Consolidated EBITDDA” means, with respect to the Parent, the Borrower and
its Subsidiaries (or, following a Parent Event, the Borrower and its
Subsidiaries) for any period, Consolidated Net Income for such period plus,
without duplication and to the extent reflected as a charge in the statement of
such Consolidated Net Income for such period, the sum of (a) income tax
expense, (b) interest expense, amortization or write-off of debt discount and
debt issuance costs and commissions, discounts and other fees and charges
associated with Indebtedness (including the Indebtedness hereunder), (c)
depletion expense, (d) depreciation and amortization expense, (e) amortization
of intangibles and organization costs, (f) any extraordinary non-cash expenses
or losses and (g) any extraordinary, unusual or non-recurring cash income or
gains to the extent not included in Consolidated Net Income, and minus, (i) to
the extent included in the statement of such Consolidated Net Income for such
period, any extraordinary, unusual or non-recurring non-cash income or gains
(including, whether or not otherwise includable as a separate item in the
statement of such Consolidated Net Income for such period, gains on the sales
of assets outside of the ordinary course of business) and (ii) any cash
payments made during such period in respect of non-cash expenses or losses and
subsequent to the fiscal quarter in which the relevant non-cash expenses or
losses were reflected as a charge in the statement of Consolidated Net Income,
all as determined on a consolidated basis. For purposes of calculating
Consolidated EBITDDA of the Parent (or if a Parent Event has occurred, the
Borrower) and its Subsidiaries for any period for the purposes of Section 6.17
and Section 6.18 of this Agreement, (i) the earnings before interest, taxes,
depletion, depreciation and amortization calculated as set forth above of any
Person or assets acquired by the Borrower or its Subsidiaries during such
period shall be included on a pro forma basis for such period as if such
acquisition, and the incurrence or assumption of any Indebtedness in connection
therewith, had occurred on the first day of such period and based upon the
financial statements and other information delivered to the Administrative
Agent pursuant to Section 5.01 hereof, and (ii) the earnings before interest,
taxes, depletion, depreciation and amortization calculated as set forth above
of any Person or assets Disposed of by the Borrower or its Subsidiaries during
such period shall be excluded, on a pro forma basis for such period as if such
Disposition, and the payment of any Indebtedness in connection therewith, had
occurred on the first day of such period and based upon the financial
statements and other information delivered to the Administrative Agent pursuant
to Section 5.01 hereof.

          “Consolidated Indebtedness” means the consolidated Indebtedness of the
Parent, the Borrower and its Subsidiaries (or, following a Parent Event, the
Borrower and its Subsidiaries).

          “Consolidated Interest Expense” means, for any period, the sum of
aggregate interest expense and capitalized interest (including the interest
portion of any Capital Lease Obligations) of the

4

 

Parent, the Borrower and its
Subsidiaries (or, following a Parent Event, the Borrower and its Subsidiaries)
determined on a consolidated basis for such period.

          “Consolidated Lease Expense” means, for the relevant period, with respect
to the Parent, the Borrower, and its Subsidiaries (or, following a Parent
Event, the Borrower and its Subsidiaries) on a consolidated basis, the sum of
all rentals in respect of all leases whereunder the Parent, the Borrower or any
Subsidiary (or, following a Parent Event, the Borrower or any Subsidiary) is
lessee, excluding Capital Lease Obligations to the extent such are included in
Consolidated Interest Expense.

          “Consolidated Net Income” means for any period, the consolidated net
income (or loss) of the Parent, the Borrower and its Subsidiaries (or,
following a Parent Event, the Borrower and its Subsidiaries), as applicable,
determined on a consolidated basis in accordance with GAAP; provided that there
shall be excluded (a) the income (or deficit) of any Person accrued prior to
the date it becomes a Subsidiary of the Borrower, or is merged into or
consolidated with the Borrower or any of its Subsidiaries, as applicable, (b)
the income (or deficit) of any Person (other than a Subsidiary of the Borrower,
as applicable) in which the Borrower or any of its Subsidiaries, as applicable,
has an ownership interest, except to the extent that any such income is
actually received by the Borrower or any of its Subsidiaries, as applicable, in
the form of dividends or similar distributions, and (c) the undistributed
earnings of any Subsidiary of the Borrower, to the extent that the declaration
or payment of dividends or similar distributions by such Subsidiary is not at
the time permitted by the terms of any Contractual Obligation or by any Law
applicable to such Subsidiary.

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

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

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

          “Disclosed Matters” means the actions, suits and proceedings and the
environmental matters disclosed in Schedule 3.03.

          “Dispose” means with respect to any property, to sell, lease, engage in a
sale and leaseback with respect thereto, assign, convey, transfer or otherwise
dispose thereof. The term “Disposition” shall have a correlative meaning.

          “Distribution Loan” means any portion of any Borrowing used by the
Borrower to fund Restricted Payments permitted pursuant to Section 6.06.

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

          “EDGAR”: the Electronic Data Gathering, Analysis, and Retrieval computer
system for the receipt, acceptance, review and dissemination of documents
submitted to the SEC in electronic format.

          “Effective Date” means the date on which the conditions specified in
Section 4.01 are satisfied (or waived in accordance with Section 9.02).

5

 

          “Environmental Laws” means all applicable laws, rules, regulations, codes,
ordinances, orders, decrees, judgments, injunctions, or legally enforceable
directives issued, promulgated or entered into by any Governmental Authority,
relating in any way to the environment, preservation or reclamation of natural
resources, the management or release of any Hazardous Material or to health
(with respect to exposure to Hazardous Materials) and safety matters.

          “Environmental Liability” means any liability (including any liability for
damages, costs of environmental remediation, fines, penalties or indemnities),
of the Borrower or any Subsidiary 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) the exposure to any Hazardous Materials, (d) the release of any
Hazardous Materials into the environment or (e) any contract, agreement or
other consensual arrangement pursuant to which liability is assumed or imposed
with respect to any of the foregoing.

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

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

          “ERISA Affiliate” means any trade or business (whether or not
incorporated) that, together with the Borrower, is treated as a single employer
under Section 414(b) or (c) of the Code or, solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.

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

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

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

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

6

 

          “Excluded Taxes” means, with respect to the Administrative Agent, any
Lender, the Issuing Bank or any other recipient of any payment to be made by or
on account of any obligation of the Borrower hereunder, (a) income or franchise
taxes imposed on (or measured by) its net income by the United States of
America, or by the jurisdiction under the laws of which such recipient is
organized or in which its principal office is located or, in the case of any
Lender, in which its applicable lending office is located, (b) any branch
profits taxes imposed by the United States of America or any similar tax
imposed by any other jurisdiction in which the Borrower is located and (c) in
the case of a Foreign Lender (other than an assignee pursuant to a request by
the Borrower under Section 2.19(b)), any withholding tax that is imposed on
amounts payable to such Foreign Lender at the time such Foreign Lender becomes
a party to this Agreement (or designates a new lending office) or is
attributable to such Foreign Lender’s failure to comply with Section 2.17(e),
except to the extent that such Foreign Lender (or its assignor, if any) was
entitled, at the time of designation of a new lending office (or assignment),
to receive additional amounts from the Borrower with respect to such
withholding tax pursuant to Section 2.17(a).

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

          “Fee Letter” means the letter agreement dated September 30, 2004, between
the Borrower, Citigroup Global Markets, Inc., Citibank, N.A., Wachovia Capital
Markets, LLC and Wachovia Bank, National Association pertaining to certain fees
and expenses payable by Borrower to such parties as set forth in such letter.

          “Financial Officer” means the chief financial officer, principal
accounting officer, treasurer or controller of the Parent or the Borrower as
applicable.

          “Financial Statement Delivery Date” means the earlier of the date on which
the financial statements of the Parent (or, if a Parent Event has occurred, the
Borrower) are delivered or are required to be delivered to the Administrative
Agent and the Lenders pursuant to Section 5.01(a) or Section 5.01(b), as the
case may be.

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

          “GAAP” means generally accepted accounting principles in the United States
of America, as in effect from time to time.

          “General Partner”: NRP (GP) LP, a Delaware limited partnership and the
sole general partner of the Parent.

          “Governmental Approval” means (i) any authorization, consent, approval,
license, waiver, ruling, permit, tariff, rate, certification, exemption,
filing, variance, claim, order, judgment, decree, sanction or publication of, by or with; (ii) any notice to; (iii)
any declaration of or with; or (iv) any registration by or with, or any other
action by or on behalf of, any Governmental Authority.

7

 

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

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

          “Guarantor” means each Subsidiary of the Borrower in existence on the
Effective Date and each Person who becomes a Subsidiary of the Borrower after
the Effective Date.

          “Guaranty Agreement” means any guaranty agreement executed by a Guarantor
in favor of the Administrative Agent and the Lenders and in the form attached
hereto as Exhibit D, together with all extensions, renewals, amendments,
substitutions and replacements thereof or thereto.

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

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

          “Indemnified Taxes” means Taxes other than Excluded Taxes.

          “Information Memorandum” means the Confidential Information Memorandum
dated September 2004 relating to the Borrower and the Transactions.

8

 

          “Interest Coverage Ratio” means, at any date, the ratio of (i)
Consolidated EBITDDA to (ii) (a) Consolidated Interest Expense, plus (b)
Consolidated Lease Expense, in each case for the period of four consecutive
fiscal quarters most recently ended on or prior to such date for which
financial information is available.

          “Interest Election Request” means a request by the Borrower to convert or
continue a Revolving Borrowing in accordance with Section 2.08.

          “Interest Payment Date” means (a) with respect to any ABR Loan, the last
day of each March, June, September and December, and (b) with respect to any
Eurodollar Loan, the last day of the Interest Period applicable to the
Borrowing of which such Loan is a part and, in the case of a Eurodollar
Borrowing with an Interest Period of more than three months’ duration, each day
prior to the last day of such Interest Period that occurs at intervals of three
months’ duration after the first day of such Interest Period.

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

          “Issuing Bank” means Citibank, N.A., in its capacity as the issuer of
Letters of Credit hereunder, and its successors in such capacity as provided in
Section 2.06(i). The Issuing Bank may, in its discretion, arrange for one or
more Letters of Credit to be issued by Affiliates of the Issuing Bank, in which
case the term “Issuing Bank” shall include any such Affiliate with respect to
Letters of Credit issued by such Affiliate.

          “Joint Lead Arrangers and Joint Bookrunners” means Citigroup Global
Markets, Inc. and Wachovia Capital Markets, LLC, in their capacity as Joint
Lead Arrangers and Joint Bookrunners hereunder.

          “Law” means all laws, statutes, treaties, ordinances, codes, acts, rules,
regulations, Government Approvals and orders of all Governmental Authorities,
whether now or hereafter in effect.

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

          “LC Exposure” means, at any time, the sum of (a) the aggregate undrawn
amount of all outstanding Letters of Credit at such time plus (b) the aggregate
amount of all LC Disbursements that have not yet been reimbursed by or on
behalf of the Borrower or converted into a Revolving Loan pursuant to Section 2.06(e) at such time. The LC Exposure of any Lender
at any time shall be its Applicable Percentage of the total LC Exposure at such
time.

9

 

          “Lease” means any lease, mineral lease, mining agreement or other
agreement to which the Borrower or any Subsidiary is a party and pursuant to
which one Person transfers or grants to another Person the right to extract,
mine or otherwise remove coal.

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

          “Letter of Credit” means any letter of credit issued pursuant to this
Agreement.

          “Letter of Credit Collateral Account” shall have the meaning set forth in
Section 2.06.

          “Leverage Ratio” means, at any date, the ratio of (i) Consolidated
Indebtedness at such date to (ii) Consolidated EBITDDA for the four consecutive
fiscal quarters most recently ended on or prior to such date for which
financial information is available.

          “LIBO Rate” means, with respect to any Eurodollar Borrowing for any
Interest Period, the rate appearing on Page 3750 of the Dow Jones Market
Service (or on any successor or substitute page of such Service, or any
successor to or substitute for such Service, providing rate quotations
comparable to those currently provided on such page of such Service, as
determined by the Administrative Agent from time to time for purposes of
providing quotations of interest rates applicable to dollar deposits in the
London interbank market) at approximately 11:00 a.m., London time, two Business
Days prior to the commencement of such Interest Period, as the rate for dollar
deposits with a maturity comparable to such Interest Period. In the event that
such rate is not available at such time for any reason, then the “LIBO Rate”
with respect to such Eurodollar Borrowing for such Interest Period shall be the
rate at which dollar deposits of $5,000,000 and for a maturity comparable to
such Interest Period are offered by the principal London office of the
Administrative Agent in immediately available funds in the London interbank
market at approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period.

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

          “Loan Documents” means this Agreement, the Guaranty Agreements, any
promissory notes executed in connection herewith, the Letters of Credit (and
any applications therefor and reimbursement agreements relating thereto), the
Fee Letter and any other agreements and documents executed and delivered in
connection with this Agreement.

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

          “Loans” means the loans made by the Lenders to the Borrower pursuant to
this Agreement.

          “Material Adverse Effect” means a material adverse effect on (a) the
business, assets, operations or condition, financial or otherwise, of the
Parent, the Borrower and its Subsidiaries (or, if a Parent Event has occurred,
the Borrower and its Subsidiaries) taken as a whole, (b) the ability of the

10

 

Borrower to perform any of its obligations under this Agreement or (c) the
rights of or benefits available to the Lenders under this Agreement.

          “Material Contract” means any individual Lease or, collectively, group of
Leases, from the Borrower or any of its Subsidiaries to a single operator or
such operator’s Affiliates which either (i) accounted for twenty percent (20%)
or more of the gross revenues of the Borrower and its Subsidiaries for the
previous fiscal year, or (ii) is projected to account for twenty percent (20%)
or more of the gross revenues of the Borrower and its Subsidiaries for the
current fiscal year.

          “Material Indebtedness” means (i) Indebtedness (other than the Loans and
Letters of Credit), and (ii) obligations in respect of one or more Swap
Agreements, of any one or more of the Borrower and its Subsidiaries in an
aggregate principal amount exceeding $10,000,000. For purposes of determining
Material Indebtedness, the “principal amount” of the obligations of the
Borrower or any Subsidiary in respect of any Swap Agreement at any time shall
be the maximum aggregate amount (giving effect to any netting agreements) that
the Borrower or such Subsidiary would be required to pay if such Swap Agreement
were terminated at such time.

          “Maturity Date” means October 29, 2009.

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

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

          “New Lender” has the meaning assigned to such term in Section 2.20.

          “New Lender Agreement” has the meaning assigned to such term in Section
2.20.

          “Note Purchase Agreement” means that certain Note Purchase Agreement dated
as of June 19, 2003 among the Borrower and the Purchasers listed therein.

          “Omnibus Agreement” means that certain Omnibus Agreement, dated October
17, 2002, by and among the General Partner, the Parent, the Borrower, GP
Natural Resource Partners LLC, WPP Group, Arch Coal Inc., Ark Land Company, and
Robertson Coal Management LLC, which provides, among other things, certain
non-competition provisions and indemnities for environmental and tax
liabilities.

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

          “Outstanding Units” has the meaning set forth in the Partnership
Agreement.

          “Parent” means Natural Resource Partners L.P.

          “Parent Event” means the occurrence of any of the following events: (i)
the Parent has any subsidiary, joint venture or other investment other than the
Borrower, (ii) the Borrower is not wholly owned by the Parent, (iii) the Parent’s financials are no longer filed
with the SEC, or (iv) the Parent has any Indebtedness to, or Guarantees any
Indebtedness of, any Person other than the Borrower.

          “Participant” has the meaning set forth in Section 9.04.

11

 

          “Partnership Agreement” means the First Amended and Restated Agreement of
Limited Partnership of the Parent dated as of October 17, 2002, as amended by
that certain Amendment No. 1 to First Amended and Restated Agreement of Limited
Partnership dated December 8, 2003, but shall not include any other amendments
or changes thereto.

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

          “Permitted Encumbrances” means:

     (a) Liens imposed by law for taxes that are not yet due or are being
contested in compliance with Section 5.04;

     (b) carriers’, warehousemen’s, mechanics’, materialmen’s,
repairmen’s and other like Liens imposed by law, arising in the ordinary
course of business and securing obligations that are not overdue by more
than 30 days or are being contested in compliance with Section 5.04;

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

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

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

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

     (h) Liens securing obligations (other than obligations representing
Indebtedness for borrowed money) under operating, reciprocal easement or
similar agreements entered into in the ordinary course of business of the
Borrower and its Subsidiaries;

     (i) licenses of patents, trademarks and other intellectual property
rights granted by the Borrower or any of its Subsidiaries in the ordinary
course of business and not interfering in any material respect with the
ordinary conduct of the business of the Borrower and its Subsidiaries;

     (j) the lien reserved in leases for rent and for compliance with the
terms of the lease in the case of leasehold estates;

     (k) any Lien in favor of any Governmental Authority to secure
partial, progress, advance or other payments pursuant to any contract or
statute, or any Lien securing industrial development, pollution control
or similar revenue bonds;

     (l) any easements, exceptions or reservations in any property or
assets granted or reserved for the purpose of pipelines, roads, the
removal of oil, gas, coal, timber or other minerals, and other like
purposes, or for the joint or common use of real property, facilities and

12

 

equipment which are incidental to, and do not materially interfere with,
the ordinary conduct of the Borrower’s and its Subsidiaries’ business;
and

     (m) Liens arising solely by virtue of any statutory or common law
provision relating to banker’s liens, rights of set-off or similar rights
and remedies and burdening only deposit accounts or other funds
maintained with a creditor depository institution.

provided that the term “Permitted Encumbrances” shall not include any
Lien securing Indebtedness except as otherwise permitted above.

          “Permitted Investments” means:

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

(b) investments in commercial paper, asset-backed securities,
auction rate securities or similar instruments maturing within 270 days
from the date of acquisition thereof and having, at such date of
acquisition, a credit rating of at least A-2 from S&P or P-2 from
Moody’s;

(c) investments in certificates of deposit, banker’s acceptances and
time deposits maturing within 180 days from the date of acquisition
thereof issued or guaranteed by or placed with, and money market deposit
accounts issued or offered by, any domestic office of any commercial bank
organized under the laws of the United States of America or any State
thereof which has a combined capital and surplus and undivided profits of
not less than $250,000,000;

(d) fully collateralized repurchase agreements with a term of not
more than 30 days for securities described in clause (a) above and
entered into with a financial institution satisfying the criteria
described in clause (c) above;

(e) money market funds that (i) comply with the criteria set forth
in SEC Rule 2a-7 under the Investment Company Act of 1940, as amended,
(ii) are rated AAA by S&P and Aaa by Moody’s and (iii) have portfolio
assets of at least $5,000,000,000;

(f) securities with maturities of six months or less from the date
of acquisition backed by standby letters of credit issued by any Lender
or any commercial bank satisfying the requirements of clause (b) of this
definition; and

(g) shares of money market mutual or similar funds which invest
exclusively in assets satisfying the requirements of clauses (a) through
(f) of this definition, except that with respect to the maturities of the
assets included in such funds the requirements of clauses (a) through (f)
shall not be applied to the individual assets included in such funds but
to the weighted-average maturity of all assets included in such funds.

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

          “Plan” means any employee pension benefit plan (other than a Multiemployer
Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Code
or Section 302 of ERISA, and

13

 

in respect of which the Borrower or any ERISA
Affiliate is (or, if such plan were terminated, would under Section 4069 of
ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.

          “Platform” shall have the meaning set forth in Section 9.01(c).

          “Prime Rate” means the rate of interest per annum publicly announced from
time to time by Citibank, N.A. as its prime rate in effect at its principal
office in New York City; each change in the Prime Rate shall be effective from
and including the date such change is publicly announced as being effective.

          “Prior Credit Agreement” means that certain Credit Agreement by and among
Borrower, the several lenders from time to time party thereto, PNC Bank,
National Association, as Administrative Agent, Branch Banking and Trust
Company, as Syndication Agent, Bank of Montreal and BNP Paribas, as
Documentation Agents and PNC Capital Markets, Inc., as Lead Arranger, dated
October 17, 2002, as amended.

          “Quarterly Distributions” means the distributions by the Parent of
Available Cash.

          “Re-Allocation Date” has the meaning assigned to such term in Section
2.20.

          “Register” has the meaning set forth in Section 9.04.

          “Regulation D” means Regulation D of the Board, as the same is from time
to time in effect, and all official rulings and interpretations thereunder or
thereof.

          “Regulation T” means Regulation T of the Board, as the same is from time
to time in effect, and all official rulings and interpretations thereunder or
thereof.

          “Regulation U” means Regulation U of the Board, as the same is from time
to time in effect, and all official rulings and interpretations thereunder or
thereof.

          “Regulation X” means Regulation X of the Board, as the same is from time
to time in effect, and all official rulings and interpretations thereunder or
thereof.

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

          “Required Lenders” means, at any time, Lenders having Revolving Credit
Exposures representing more than 50% of the sum of the total Revolving Credit
Exposures or, if at such time no Lenders have Revolving Credit Exposure,
Lenders having unused Commitments representing more than 50% of the unused
Commitments at such time.

          “Response” means (a) “response” as such term is defined in CERCLA, 42
U.S.C. §9601(25), and (b) all other actions required by any Governmental
Authority or voluntarily undertaken to: (i) clean up, remove, treat, abate, or
in any other way address any Hazardous Material in the environment;
(ii) prevent the release of any Hazardous Material; or (iii) perform
studies and investigations in connection with clause (i) or (ii) above.

          “Restricted Payment” means any dividend or other distribution (whether in
cash, securities or other property) with respect to any Equity Interests in the
Borrower or any Subsidiary, or any

14

 

payment (whether in cash, securities or
other property), including any sinking fund or similar deposit, on account of
the purchase, redemption, retirement, acquisition, cancellation or termination
of any such Equity Interests in the Borrower or any option, warrant or other
right to acquire any such Equity Interests in the Borrower.

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

          “Revolving Loan” means a Loan made pursuant to Section 2.03.

          “S&P” means Standard & Poor’s.

          “SEC” means the Securities and Exchange Commission (or successors thereto
or an analogous Governmental Authority).

          “Solvent” means, with respect to any Person on a particular date, that on
such date (i) the fair value of the property of such Person is greater than the
total amount of liabilities, including contingent liabilities, of such Person,
(ii) the present fair salable value of the assets 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, (iii) such Person is
able to realize upon its assets and pay its debts and other liabilities,
contingent obligations and other commitments as they mature in the normal
course of business, (iv) 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, taking into account the possibility of
refinancing such debt or selling such assets, and (v) 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. In computing the amount of contingent liabilities at any time,
it is intended that such liabilities will be computed at the amount which, in
light of all the facts and circumstances existing at such time, represents the
amount that can reasonably be expected to become an actual or matured
liability.

          “Statutory Reserve Rate” means a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
one minus the aggregate of the maximum reserve percentages (including any
marginal, special, emergency or supplemental reserves) expressed as a decimal
established by the Board to which the Administrative Agent is subject (a) with
respect to the Base CD Rate, for new negotiable non-personal time deposits in
dollars of over $100,000 with maturities approximately equal to three months
and (b) with respect to the Adjusted LIBO Rate, for eurocurrency funding
(currently referred to as “Eurocurrency Liabilities” in Regulation D of the
Board). Such reserve percentages shall include those imposed pursuant to such
Regulation D. Eurodollar Loans shall be deemed to constitute eurocurrency
funding and to be subject to such reserve requirements without benefit of or
credit for proration, exemptions or offsets that may be available from time to
time to any Lender under such Regulation D or any comparable regulation. The
Statutory Reserve Rate shall be adjusted automatically on and as of the
effective date of any change in any reserve percentage.

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

15

 

Controlled, by the parent or one or more subsidiaries of the parent or by the
parent and one or more subsidiaries of the parent.

          “Subsidiary” means any subsidiary of the Borrower.

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

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

          “Three-Month Secondary CD Rate” means, for any day, the secondary market
rate for three-month certificates of deposit reported as being in effect on
such day (or, if such day is not a Business Day, the next preceding Business
Day) by the Board through the public information telephone line of the Federal
Reserve Bank of New York (which rate will, under the current practices of the
Board, be published in Federal Reserve Statistical Release H.15(519) during the
week following such day) or, if such rate is not so reported on such day or
such next preceding Business Day, the average of the secondary market
quotations for three-month certificates of deposit of major money center banks
in New York City received at approximately 10:00 a.m., New York City time, on
such day (or, if such day is not a Business Day, on the next preceding Business
Day) by the Administrative Agent from three negotiable certificate of deposit
dealers of recognized standing selected by it.

          “Transactions” means the execution, delivery and performance by the
Borrower of this Agreement, the borrowing of Loans, the use of the proceeds
thereof and the issuance of Letters of Credit hereunder.

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

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

          “WPP Group” means, collectively, Western Pocahontas Properties Limited
Partnership, a Delaware limited partnership, Great Northern Properties Limited
Partnership, a Delaware limited partnership, and New Gauley Coal Corporation, a
West Virginia corporation.

          SECTION 1.02. Classification of Loans and Borrowings. For purposes of this Agreement, Loans may be classified and referred to
by Class (e.g., a “Revolving Loan”) or by Type (e.g., a “Eurodollar Loan”) or
by Class and Type (e.g., a “Eurodollar Revolving Loan”). Borrowings also may
be classified and referred to by Class (e.g., a “Revolving Borrowing”) or by
Type (e.g., a “Eurodollar Borrowing”) or by Class and Type (e.g., a “Eurodollar
Revolving Borrowing”).

          SECTION 1.03. Terms Generally. The definitions of terms herein shall apply equally to the singular and plural
forms of the terms defined. Whenever the context may require, any pronoun
shall

16

 

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

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

ARTICLE II

The Credits

          SECTION 2.01. Commitments. Subject to the terms and conditions set forth herein, each Lender agrees to
make Revolving Loans to the Borrower from time to time during the Availability
Period in an aggregate principal amount that will not result in (a) such
Lender’s Revolving Credit Exposure exceeding such Lender’s Commitment or (b)
the sum of the total Revolving Credit Exposures exceeding the total
Commitments. Within the foregoing limits and subject to the terms and
conditions set forth herein, the Borrower may borrow, prepay and re-borrow
Revolving Loans.

          SECTION 2.02. Loans and Borrowings. (a) Each Revolving Loan shall be made as part of a Borrowing
consisting of Revolving Loans made by the Lenders ratably in accordance with
their respective Commitments. The failure of any Lender to make any Loan
required to be made by it shall not relieve any other Lender of its obligations
hereunder; provided that the Commitments of the Lenders are several and no
Lender shall be responsible for any other Lender’s failure to make Loans as
required.

          (b) Subject to Section 2.14, each Revolving Borrowing shall be comprised
entirely of ABR Loans or Eurodollar Loans as the Borrower may request in
accordance herewith. Each Lender at its option may make any Eurodollar Loan by
causing any domestic or foreign branch or Affiliate of such Lender to make such
Loan; provided that any exercise of such option shall not affect the obligation
of the Borrower to repay such Loan in accordance with the terms of this
Agreement.

          (c) At the commencement of each Interest Period for any Eurodollar
Revolving Borrowing, such Borrowing shall be in an aggregate amount that is an
integral multiple of $1,000,000 and

17

 

not less than $1,000,000. At the time that
each ABR Revolving Borrowing is made, such Borrowing shall be in an aggregate
amount that is an integral multiple of $1,000,000 and not less than
$1,000,000; provided that an ABR Revolving Borrowing may be in an aggregate
amount that is equal to the entire unused balance of the total Commitments or
that is required to finance the reimbursement of an LC Disbursement as
contemplated by Section 2.06(e). Borrowings of more than one Type may be
outstanding at the same time; provided that there shall not at any time be more
than a total of ten (10) Eurodollar Revolving Borrowings outstanding.

          (d) Notwithstanding any other provision of this Agreement, the Borrower
shall not be entitled to request, or to elect to convert or continue, any
Borrowing if the Interest Period requested with respect thereto would end after
the Maturity Date.

          SECTION 2.03. Requests for Revolving Borrowings. To request a Revolving Borrowing, the Borrower shall
notify the Administrative Agent of such request by telephone (a) in the case of
a Eurodollar Borrowing, not later than 11:00 a.m., New York City time, three
Business Days before the date of the proposed Borrowing or (b) in the case of
an ABR Borrowing, not later than 11:00 a.m., New York City time, on the date of
the proposed Borrowing; provided that any such notice of an ABR Revolving
Borrowing to finance the reimbursement of an LC Disbursement as contemplated by
Section 2.06(e) may be given not later than 10:00 a.m., New York City time, on
the date of the proposed Borrowing. Each such telephonic Borrowing Request
shall be irrevocable and shall be confirmed promptly by hand delivery or
telecopy to the Administrative Agent of a written Borrowing Request in a form
approved by the Administrative Agent and signed by the Borrower. Each such
telephonic and written Borrowing Request shall specify the following
information in compliance with Section 2.02:

     (i) the aggregate amount of the requested Borrowing;

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

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

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

     (v) the location and number of the Borrower’s account to which
funds are to be disbursed, which shall comply with the requirements
of Section 2.07.

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

          SECTION 2.04. Intentionally Deleted.

          SECTION 2.05. Intentionally Deleted.

          SECTION 2.06. Letters of Credit. (a) General. Subject to the terms and conditions set forth herein, the
Borrower may request the issuance of Letters of Credit for its own account or
for the

18

 

account of any Subsidiary, in a form reasonably acceptable to the
Administrative Agent and the Issuing Bank, at any time and from time to time
during the Availability Period. In the event of any inconsistency between the
terms and conditions of this Agreement and the terms and conditions of any form
of letter of credit application or other agreement submitted by the Borrower
to, or entered into by the Borrower with, the Issuing Bank relating to any
Letter of Credit, the terms and conditions of this Agreement shall control.

          (b) Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions.
To request the issuance of a Letter of Credit (or the amendment, renewal or
extension of an outstanding Letter of Credit), the Borrower shall hand deliver
or telecopy (or transmit by electronic communication, if arrangements for doing
so have been approved by the Issuing Bank) to the Issuing Bank and the
Administrative Agent (reasonably in advance of the requested date of issuance,
amendment, renewal or extension) a notice requesting the issuance of a Letter
of Credit, or identifying the Letter of Credit to be amended, renewed or
extended, and specifying the date of issuance, amendment, renewal or extension
(which shall be a Business Day), the date on which such Letter of Credit is to
expire (which shall comply with paragraph (c) of this Section), the amount of
such Letter of Credit, the name and address of the beneficiary thereof and such
other information as shall be necessary to prepare, amend, renew or extend such
Letter of Credit. If requested by the Issuing Bank, the Borrower also shall
submit a letter of credit application on the Issuing Bank’s standard form in
connection with any request for a Letter of Credit. A Letter of Credit shall
be issued, amended, renewed or extended only if (and upon issuance, amendment,
renewal or extension of each Letter of Credit the Borrower shall be deemed to
represent and warrant that), after giving effect to such issuance, amendment,
renewal or extension (i) the LC Exposure shall not exceed $2,000,000 and (ii)
the sum of the total Revolving Credit Exposures shall not exceed the total
Commitments.

          (c) Expiration Date. Each Letter of Credit shall expire at or prior to
the close of business on the earlier of (i) the date one year after the date of
the issuance of such Letter of Credit (or, in the case of any renewal or
extension thereof, one year after such renewal or extension) and (ii) the date
that is five Business Days prior to the Maturity Date; provided, however, that
any Letter of Credit with a one year tenor may provide for the renewal thereof
for additional one year periods which shall in no event
extend beyond the date that is five Business Days prior to the Maturity
Date unless cash collateral, as set forth in Section 2.06(k) below shall have
been granted to the Issuing Bank as security for the Indebtedness under the
Loan Documents no later than five Business Days prior to the Maturity Date, in
which case such cash collateralized Letter of Credit shall not have an
expiration date later than one year after the Maturity Date.

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

19

 

Letter of Credit in accordance with Section 2.06(b), the Administrative Agent
shall advise each Lender of the details thereof and of the amount of such
Lender’s participation in such Letter of Credit.

          (e) Reimbursement. If the Issuing Bank shall make any LC Disbursement in
respect of a Letter of Credit, the Borrower shall reimburse such LC
Disbursement by paying to the Administrative Agent an amount equal to such LC
Disbursement not later than 12:00 noon, New York City time, on the date that
such LC Disbursement is made, if the Borrower shall have received notice of
such LC Disbursement prior to 10:00 a.m., New York City time, on such date, or,
if such notice has not been received by the Borrower prior to such time on such
date, then not later than 12:00 noon, New York City time, on (i) the Business
Day that the Borrower receives such notice, if such notice is received prior to
10:00 a.m., New York City time, on the day of receipt, or (ii) the Business Day
immediately following the day that the Borrower receives such notice, if such
notice is not received prior to such time on the day of receipt; provided that
the Borrower may, subject to the conditions to borrowing set forth herein,
request in accordance with Section 2.03 that such payment be financed with an
ABR Revolving Borrowing in an equivalent amount and, to the extent so financed,
the Borrower’s obligation to make such payment shall be discharged and replaced
by the resulting ABR Revolving Borrowing. If the Borrower fails to make such
payment when due, the Administrative Agent shall notify each Lender of the
applicable LC Disbursement, the payment then due from the Borrower in respect
thereof and such Lender’s Applicable Percentage thereof. Promptly following
receipt of such notice, each Lender shall pay to the Administrative Agent its
Applicable Percentage of the payment then due from the Borrower, in the same
manner as provided in Section 2.07 with respect to Loans made by such Lender
(and Section 2.07 shall apply, mutatis mutandis, to the payment obligations of
the Lenders), and the Administrative Agent shall promptly pay to the Issuing
Bank the amounts so received by it from the Lenders. Promptly following
receipt by the Administrative Agent of any payment from the Borrower pursuant
to this paragraph, the Administrative Agent shall distribute such payment to
the Issuing Bank or, to the extent that Lenders have made payments pursuant to
this paragraph to reimburse the Issuing Bank, then to such Lenders and the
Issuing Bank as their interests may appear. Any payment made by a Lender
pursuant to this paragraph to reimburse the Issuing Bank for any LC
Disbursement (other than the funding of ABR Revolving Loans as contemplated
above) shall not constitute a Loan and shall not relieve the Borrower of its
obligation to reimburse such LC Disbursement.

          (f) Obligations Absolute. The Borrower’s obligation to reimburse LC
Disbursements as provided in paragraph (e) of this Section shall be absolute,
unconditional and irrevocable, and shall be performed strictly in accordance
with the terms of this Agreement under any and all circumstances whatsoever and
irrespective of (i) any lack of validity or enforceability of any Letter of
Credit or this Agreement, or any term or provision therein, (ii) any draft or
other document presented under a Letter of Credit proving to be forged,
fraudulent or invalid in any respect or any statement therein being untrue or
inaccurate in any respect, (iii) payment by the Issuing Bank under a Letter of
Credit against presentation of a draft or other document that does not comply
with the terms of such Letter of Credit, or (iv) any other event or
circumstance whatsoever, whether or not similar to any of the foregoing, that
might, but for the provisions of this Section, constitute a legal or equitable
discharge of, or provide a right of setoff against, the Borrower’s obligations
hereunder. Neither the Administrative Agent, the Lenders nor the Issuing Bank,
nor any of their Related Parties, shall have any liability or responsibility by
reason of or in connection with the issuance or transfer of any Letter of
Credit or any payment or failure to make any payment thereunder (irrespective
of any of the circumstances referred to in the preceding sentence), or any
error, omission, interruption, loss or delay in transmission or delivery of any
draft, notice or other communication under or relating to any Letter of Credit
(including any document required to make a drawing thereunder), any error in
interpretation of technical terms or any consequence arising from causes beyond
the control of the Issuing Bank; provided that the foregoing shall not be
construed to excuse the Issuing Bank from liability to the Borrower to the
extent of any direct damages (as opposed to consequential damages, claims in
respect of which are hereby waived by the Borrower to the extent

20

 

permitted by
applicable Law) suffered by the Borrower that are caused by the Issuing Bank’s
failure to exercise care when determining whether drafts and other documents
presented under a Letter of Credit comply with the terms thereof. The parties
hereto expressly agree that, in the absence of gross negligence or willful
misconduct on the part of the Issuing Bank (as finally determined by a court of
competent jurisdiction), the Issuing Bank shall be deemed to have exercised
care in each such determination. In furtherance of the foregoing and without
limiting the generality thereof, the parties agree that, with respect to
documents presented which appear on their face to be in substantial compliance
with the terms of a Letter of Credit, the Issuing Bank may, in its sole
discretion, either accept and make payment upon such documents without
responsibility for further investigation, regardless of any notice or
information to the contrary, or refuse to accept and make payment upon such
documents if such documents are not in strict compliance with the terms of such
Letter of Credit.

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

          (h) Interim Interest. If the Issuing Bank shall make any LC Disbursement,
then, unless the Borrower shall reimburse such LC Disbursement in full on the
date such LC Disbursement is made, the unpaid amount thereof shall bear
interest, for each day from and including the date such LC Disbursement is made
to but excluding the date that the Borrower reimburses such LC Disbursement, at
the rate per annum then applicable to ABR Revolving Loans; provided that, if
the Borrower fails to reimburse such LC Disbursement when due pursuant to
paragraph (e) of this Section, then Section 2.13(d) shall apply. Interest
accrued pursuant to this paragraph shall be for the account of the Issuing
Bank, except that interest accrued on and after the date of payment by any
Lender pursuant to paragraph (e) of this Section to reimburse the Issuing Bank
shall be for the account of such Lender to the extent of such payment.

          (i) Replacement of the Issuing Bank. The Issuing Bank may be replaced at
any time by written agreement among the Borrower, the Administrative Agent, the
replaced Issuing Bank and the successor Issuing Bank. The Administrative Agent
shall notify the Lenders of any such replacement of the Issuing Bank. At the
time any such replacement shall become effective, the Borrower shall pay all
unpaid fees accrued for the account of the replaced Issuing Bank pursuant to
Section 2.12(b). From and after the effective date of any such replacement,
(i) the successor Issuing Bank shall have all the rights and obligations of the
Issuing Bank under this Agreement with respect to Letters of Credit to be
issued thereafter and (ii) references herein to the term “Issuing Bank” shall
be deemed to refer to such successor or to any previous Issuing Bank, or to
such successor and all previous Issuing Banks, as the context shall require.
After the replacement of an Issuing Bank hereunder, the replaced Issuing Bank
shall remain a party hereto and shall continue to have all the rights and
obligations of an Issuing Bank under this Agreement with respect to Letters of
Credit issued by it prior to such replacement, but shall not be required to
issue additional Letters of Credit.

          (j) Cash Collateralization. If any Event of Default shall occur and be
continuing, on the Business Day that the Borrower receives notice from the
Administrative Agent or the Required Lenders (or, if the maturity of the Loans
has been accelerated, the Lenders with LC Exposure representing greater than
50% of the total LC Exposure) demanding the deposit of cash collateral pursuant
to this paragraph, the Borrower shall deposit in an account with the
Administrative Agent, in the name of the Administrative Agent and for the
benefit of the Lenders, an amount in cash equal to the LC Exposure as

21

 

of such
date plus any accrued and unpaid interest thereon; provided that the obligation
to deposit such cash collateral shall become effective immediately, and such
deposit shall become immediately due and payable, without demand or other
notice of any kind, upon the occurrence of any Event of Default with respect to
the Borrower described in clause (h), (i) or (j) of Article VII. Such deposit
shall be held by the Administrative Agent as collateral for the payment and
performance of the obligations of the Borrower under this Agreement. The
Administrative Agent shall have exclusive dominion and control, including the
exclusive right of withdrawal, over such account. Funds held in such account
shall be invested in money market funds of the Administrative Agent or in
another investment if mutually agreed upon by the Borrower and the
Administrative Agent, but the Administrative Agent shall have no other
obligation to make any other investment of the funds therein. The
Administrative Agent shall exercise reasonable care in the custody and
preservation of any funds held in such account and shall be deemed to have
exercised such care if such funds are accorded treatment substantially
equivalent to that which the Administrative Agent accords its own property, it
being understood that the Administrative Agent shall not have any
responsibility for taking any necessary steps to preserve rights against any
parties with respect to any such funds. Interest or profits, if any, on such
investments shall accumulate in such account. Moneys in such account shall be
applied by the Administrative Agent to reimburse the Issuing Bank for LC
Disbursements for which it has not been reimbursed and, to the extent not so
applied, shall be held for the satisfaction of the reimbursement obligations of
the Borrower for the LC Exposure at such time or, if the maturity of the Loans
has been accelerated (but subject to the consent of the Lenders with LC
Exposure representing greater than 50% of the total LC Exposure), be applied to
satisfy other obligations of the Borrower under this Agreement. If the
Borrower is required to provide an amount of cash collateral hereunder as a
result of the occurrence of an Event of Default, such amount (to the extent not
applied as aforesaid) shall be returned to the Borrower within three Business
Days after all Events of Default have been cured or waived.

          (k) In the event any Letters of Credit shall be outstanding according to
their terms after the Maturity Date, the Borrower shall pay to the
Administrative Agent, no later than the date that is five Business Days prior
to the Maturity Date, an amount equal to the undrawn amount of such Letters of
Credit to be held in a special interest bearing cash collateral account pledged
to the Administrative Agent (the “Letter of Credit Collateral Account”). The
Borrower and the Administrative Agent shall establish the Letter of Credit
Collateral Account and the Borrower shall execute all documents and agreements,
including the Administrative Agent’s standard form of assignment of
deposit accounts, that the Administrative Agent reasonably requests in
connection therewith to establish the Letter of Credit Collateral Account and
grant the Administrative Agent, for the benefit of the Lenders, a first
priority security interest in such account and the funds therein. The Borrower
hereby pledges to the Administrative Agent and grants the Administrative Agent
a security interest in the Letter of Credit Collateral Account, whenever
established, in all funds held in the Letter of Credit Collateral Account from
time to time, and in all proceeds thereof as security for the payment of all
Indebtedness existing under the Loan Documents. Funds held in the Letter of
Credit Collateral Account shall be held as cash collateral for obligations
described in this Section 2.06 and all other Indebtedness under the Loan
Documents and promptly applied by the Administrative Agent at the request of
the Issuing Bank to any reimbursement or other obligations under Letters of
Credit that exist or occur in the future during such time as the Borrower has
any outstanding obligations to the Issuing Bank. To the extent that any
surplus funds are held in the Letters of Credit Collateral Account above the
undrawn amount of any outstanding Letters of Credit, during the existence of an
Event of Default the Administrative Agent may (A) hold such surplus funds in
the Letter of Credit Collateral Account as cash collateral or (B) apply such
surplus funds to satisfy any outstanding Indebtedness under the Loan Documents.
If no Default exists, the Administrative Agent shall release to the Borrower
at the Borrower’s written request any funds held in the Letter of Credit
Collateral Account above the amount required by this Section. Funds held in
the Letter of Credit Collateral Account shall be invested in money market funds
of the Administrative Agent or in another investment if mutually agreed upon by
the Borrower and the Administrative Agent, but the

22

 

Administrative Agent shall
have no other obligation to make any other investment of the funds therein.
The Administrative Agent shall exercise reasonable care in the custody and
preservation of any funds held in the Letter of Credit Collateral Account and
shall be deemed to have exercised such care if such funds are accorded
treatment substantially equivalent to that which the Administrative Agent
accords its own property, it being understood that the Administrative Agent
shall not have any responsibility for taking any necessary steps to preserve
rights against any parties with respect to any such funds.

          SECTION 2.07. Funding of Borrowings. (a) Each Lender shall make each Loan to be made by it hereunder on the
proposed date thereof by wire transfer of immediately available funds by 12:00
noon, New York City time, to the account of the Administrative Agent most
recently designated by it for such purpose by notice to the Lenders. The
Administrative Agent will make such Loans available to the Borrower by promptly
crediting the amounts so received, in like funds, to an account of the Borrower
maintained with the Administrative Agent in New York City and designated by the
Borrower in the applicable Borrowing Request; provided that ABR Revolving Loans
made to finance the reimbursement of an LC Disbursement as provided in Section
2.06(e) shall be remitted by the Administrative Agent to the Issuing Bank.

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

          SECTION 2.08. Interest Elections. (a) Each Revolving Borrowing initially shall be of the Type specified
in the applicable Borrowing Request and, in the case of a Eurodollar Revolving
Borrowing, shall have an initial Interest Period as specified in such Borrowing
Request. Thereafter, the Borrower may elect to convert such Borrowing to a
different Type or to continue such Borrowing and, in the case of a Eurodollar
Revolving Borrowing, may elect Interest Periods therefor, all as provided in
this Section. The Borrower may elect different options with respect to
different portions of the affected Borrowing, in which case each such portion
shall be allocated ratably among the Lenders holding the Loans comprising such
Borrowing, and the Loans comprising each such portion shall be considered a
separate Borrowing.

          (b) To make an election pursuant to this Section, the Borrower shall
notify the Administrative Agent of such election by telephone by the time that
a Borrowing Request would be required under Section 2.03 if the Borrower were
requesting a Revolving Borrowing of the Type resulting from such election to be
made on the effective date of such election. Each such telephonic Interest
Election Request shall be irrevocable and shall be confirmed promptly by hand
delivery or telecopy to the Administrative Agent of a written Interest Election
Request in a form approved by the Administrative Agent and signed by the
Borrower.

23

 

          (c) Each telephonic and written Interest Election Request shall specify
the following information in compliance with Section 2.02:

     (i) the Borrowing to which such Interest Election Request
applies and, if different options are being elected with respect to
different portions thereof, the portions thereof to be allocated to
each resulting Borrowing (in which case the information to be
specified pursuant to clauses (iii) and (iv) below shall be
specified for each resulting Borrowing);

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

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

     (iv) if the resulting Borrowing is a Eurodollar Borrowing, the
Interest Period to be applicable thereto after giving effect to
such election, which shall be a period contemplated by the
definition of the term “Interest Period”. If any such Interest
Election Request requests a Eurodollar Borrowing but does not
specify an Interest Period, then the Borrower shall be deemed to
have selected an Interest Period of one month’s duration.

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

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

          SECTION 2.09. Termination and Reduction of Commitments. (a) Unless previously terminated, the Commitments
shall terminate on the Maturity Date.

          (b) The Borrower may at any time terminate, or from time to time reduce,
the Commitments; provided that (i) each reduction of the Commitments shall be
in an amount that is an integral multiple of $1,000,000 and not less than
$10,000,000 and (ii) the Borrower shall not terminate or reduce the Commitments
if, after giving effect to any concurrent prepayment of the Loans in accordance
with Section 2.11, the sum of the Revolving Credit Exposures would exceed the
total Commitments.

          (c) The Borrower shall notify the Administrative Agent of any election to
terminate or reduce the Commitments under paragraph (b) of this Section at
least three Business Days prior to the effective date of such termination or
reduction, specifying such election and the effective date thereof. Promptly
following receipt of any notice, the Administrative Agent shall advise the
Lenders of the contents thereof. Each notice delivered by the Borrower
pursuant to this Section shall be irrevocable; provided that a notice of
termination of the Commitments delivered by the Borrower may state that such
notice is conditioned upon the effectiveness of other credit facilities, in
which case such notice may be

24

 

revoked by the Borrower (by notice to the
Administrative Agent on or prior to the specified effective date) if such
condition is not satisfied. Any termination or reduction of the Commitments
shall be permanent and such Commitments shall not be reinstated. Each
reduction of the Commitments shall be made ratably among the Lenders in
accordance with their respective Commitments.

          SECTION 2.10. Repayment of Loans; Evidence of Debt. (a) The Borrower hereby unconditionally promises to pay to
the Administrative Agent for the account of each Lender the then unpaid
principal amount of each Revolving Loan on the Maturity Date.

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

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

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

          (e) Any Lender may request that Loans made by it be evidenced by a
promissory note. In such event, the Borrower shall prepare, execute and
deliver to such Lender a promissory note payable to the order of such Lender
(or, if requested by such Lender, to such Lender and its registered assigns)
and in a form approved by the Administrative Agent. Thereafter, the Loans
evidenced by such promissory note and interest thereon shall at all times
(including after assignment pursuant to Section 9.04) be represented by one or
more promissory notes in such form payable to the order of the payee named
therein (or, if such promissory note is a registered note, to such payee and
its registered assigns).

          SECTION 2.11. Prepayment of Loans. (a) The Borrower shall have the right at any time and from time to
time to prepay any Borrowing in whole or in part, subject to prior notice in
accordance with paragraph (b) of this Section; provided that each such
prepayment shall be in an amount that is an integral multiple of $1,000,000 and
not less than $1,000,000.

          (b) The Borrower shall notify the Administrative Agent by telephone
(confirmed by telecopy) of any prepayment hereunder (i) in the case of
prepayment of a Eurodollar Revolving Borrowing, not later than 11:00 a.m., New
York City time, two Business Days before the date of prepayment, or (ii) in the
case of prepayment of an ABR Revolving Borrowing, not later than 11:00 a.m.,
New York City time, on the date of prepayment. Each such notice shall be
irrevocable and shall specify the prepayment date and the principal amount of
each Borrowing or portion thereof to be prepaid; provided that, if a notice of
prepayment is given in connection with a conditional notice of termination of
the Commitments as contemplated by Section 2.09, then such notice of prepayment
may be revoked if such notice of termination is revoked in accordance with
Section 2.09. Promptly following receipt of any such notice relating to a
Revolving Borrowing, the Administrative Agent shall advise the Lenders of the
contents thereof. Each partial prepayment of any Revolving Borrowing shall be
in an amount that would be permitted in the case of an advance of a Revolving
Borrowing of the same Type as provided in Section

25

 

2.02. Each prepayment of a
Revolving Borrowing shall be applied ratably to the Loans included in the
prepaid Borrowing. Prepayments shall be accompanied by accrued interest to the
extent required by Section 2.13.

          SECTION 2.12. Fees. (a) The Borrower agrees to pay to the Administrative Agent for the account of each
Lender a commitment fee, which shall accrue at the Applicable Rate on the daily
amount of the Commitment of such Lender (whether used or unused) during the
period from and including the date of this Agreement to but excluding the date
on which such Commitment terminates; provided that, if such Lender continues to
have any Revolving Credit Exposure after its Commitment terminates, then such
commitment fee shall continue to accrue on the daily amount of such Lender’s
Revolving Credit Exposure from and including the date on which its Commitment
terminates to but excluding the date on which such Lender ceases to have any
Revolving Credit Exposure. Accrued commitment fees shall be payable in arrears
on the last day of March, June, September and December of each year and on the
date on which the Commitments terminate, commencing on the first such date to
occur after the date hereof; provided that any commitment fees accruing after
the date on which the Commitments terminate shall be payable on demand. All
commitment fees shall be computed on the basis of a year of 360 days and shall
be payable for the actual number of days elapsed (including the first day but
excluding the last day).

          (b) The Borrower agrees to pay (i) to the Administrative Agent for the
account of each Lender a participation fee with respect to its participations
in Letters of Credit, which shall accrue at the same Applicable Rate used to
determine the interest rate applicable to Eurodollar Revolving Loans on the
average daily amount of such Lender’s LC Exposure (excluding any portion
thereof attributable to un-reimbursed LC Disbursements) during the period from and including the
Effective Date to but excluding the later of the date on which such Lender’s
Commitment terminates and the date on which such Lender ceases to have any LC
Exposure, and (ii) to the Issuing Bank a fronting fee, which shall accrue at
the rate of one-eighth of one percent (0.125%) per annum, on the average daily
amount of the LC Exposure (excluding any portion thereof attributable to
un-reimbursed LC Disbursements) during the period from and including the
Effective Date to but excluding the later of the date of termination of the
Commitments and the date on which there ceases to be any LC Exposure, as well
as the Issuing Bank’s standard fees with respect to the issuance, amendment,
renewal or extension of any Letter of Credit or processing of drawings
thereunder. Participation fees and fronting fees accrued through and including
the last day of March, June, September and December of each year shall be
payable on the third Business Day following such last day, commencing on the
first such date to occur after the Effective Date; provided that all such fees
shall be payable on the date on which the Commitments terminate and any such
fees accruing after the date on which the Commitments terminate shall be
payable on demand. Any other fees payable to the Issuing Bank pursuant to this
paragraph shall be payable within 10 days after demand. All participation fees
and fronting fees shall be computed on the basis of a year of 360 days and
shall be payable for the actual number of days elapsed (including the first day
but excluding the last day).

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

          (d) The Borrower agrees to pay to the Joint Bookrunners and Joint Lead
Arrangers, for their own account, fees payable in the amounts and at the times
separately agreed upon between the Borrower and the Joint Lead Arrangers and
Joint Bookrunners.

          (e) All fees payable hereunder shall be paid on the dates due, in
immediately available funds, to the Administrative Agent (or to the Issuing
Bank, in the case of fees payable to it) for distribution, in the case of
commitment fees and participation fees, to the Lenders or to the Joint Lead

26

 

Arrangers and Joint Bookrunners, as applicable. Fees paid shall not be
refundable under any circumstances.

          SECTION 2.13. Interest. (a) The Loans comprising each ABR Borrowing shall bear interest at the Alternate
Base Rate plus the Applicable Rate.

          (b) The Loans comprising each Eurodollar Borrowing shall bear interest at
the Adjusted LIBO Rate for the Interest Period in effect for such Borrowing
plus the Applicable Rate.

          (c) Notwithstanding the foregoing, if any principal of or interest on any
Loan or any fee or other amount payable by the Borrower hereunder is not paid
when due, whether at stated maturity, upon acceleration or otherwise, such
overdue amount shall bear interest, after as well as before judgment, at a rate
per annum equal to (i) in the case of overdue principal of any Loan, 2% plus
the rate otherwise applicable to such Loan as provided in the preceding
paragraphs of this Section or (ii) in the case of any other amount, 2% plus the
rate applicable to ABR Loans as provided in paragraph (a) of this Section.

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

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

          SECTION 2.14. Alternate Rate of Interest. If prior to the commencement of any Interest Period for a
Eurodollar Borrowing:

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

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

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

27

 

the circumstances giving rise to such notice affect only one Type of
Borrowings, then the other Type of Borrowings shall be permitted.

          SECTION 2.15. Increased Costs. (a) If any Change in Law shall:

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

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

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

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

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

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

28

 

          SECTION 2.16. Break Funding Payments. In the event of (a) the payment of any principal of any Eurodollar Loan
other than on the last day of an Interest Period applicable thereto (including
as a result of an Event of Default), (b) the conversion of any Eurodollar Loan
other than on the last day of the Interest Period applicable thereto, (c) the
failure to borrow, convert, continue or prepay any Eurodollar Loan on the date
specified in any notice delivered pursuant hereto (regardless of whether such
notice may be revoked under Section 2.11(b) and is revoked in accordance
therewith), or (d) the assignment of any Eurodollar Loan other than on the last
day of the Interest Period applicable thereto as a result of a request by the
Borrower pursuant to Section 2.19, then, in any such event, the Borrower shall
compensate each Lender for the loss, cost and expense attributable to such
event. In the case of a Eurodollar Loan, such loss, cost or expense to any
Lender shall be deemed to include an amount determined by such Lender to be the
excess, if any, of (i) the amount of interest which would have accrued on the
principal amount of such Loan had such event not occurred, at the Adjusted LIBO
Rate that would have been applicable to such Loan, for the period from the date
of such event to the last day of the then current Interest Period therefor (or,
in the case of a failure to borrow, convert or continue, for the period that
would have been the Interest Period for such Loan), over (ii) the amount of
interest which would accrue on such principal amount for such period at the
interest rate which such Lender would bid were it to bid, at the commencement
of such period, for dollar deposits of a comparable amount and period from other banks in the eurodollar market. A
certificate of any Lender setting forth any amount or amounts that such Lender
is entitled to receive pursuant to this Section shall be delivered to the
Borrower and shall be conclusive absent manifest error. The Borrower shall pay
such Lender the amount shown as due on any such certificate within 10 days
after receipt thereof.

          SECTION 2.17. Taxes. (a) Any
and all payments by or on account of any obligation of the Borrower hereunder
shall be made free and clear of and without deduction for any Indemnified Taxes
or Other Taxes; provided that if the Borrower shall be required to deduct any
Indemnified Taxes or Other Taxes from such payments, then (i) the sum payable
shall be increased as necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section)
the Administrative Agent, Lender or Issuing Bank (as the case may be) receives
an amount equal to the sum it would have received had no such deductions been
made, (ii) the Borrower shall make such deductions and (iii) the Borrower shall
pay the full amount deducted to the relevant Governmental Authority in
accordance with applicable Law.

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

          (c) The Borrower shall indemnify the Administrative Agent, each Lender and
the Issuing Bank, within 10 days after written demand therefor, for the full
amount of any Indemnified Taxes or Other Taxes paid by the Administrative
Agent, such Lender or the Issuing Bank, as the case may be, on or with respect
to any payment by or on account of any obligation of the Borrower hereunder
(including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable to amounts payable under this Section) and any penalties, interest
and reasonable expenses arising therefrom or with respect thereto, whether or
not such Indemnified Taxes or Other Taxes were correctly or legally imposed or
asserted by the relevant Governmental Authority, except to the extent such sums
are determined by a court of competent jurisdiction by final and non-appealable
judgment to have resulted from the gross negligence or willful misconduct of
the Administrative Agent, the Issuing Bank or such Lender, as applicable. A
certificate as to the amount of such payment or liability delivered to the
Borrower by a Lender or the Issuing Bank, or by the Administrative Agent on its
own behalf or on behalf of a Lender or the Issuing Bank, shall be conclusive
absent manifest error. Neither the Administrative Agent, the Issuing Bank nor
any Lender shall be entitled to receive any payment with respect to Indemnified
Taxes that are incurred or accrued more than 180 days prior to the date such
party gives notice and demand with respect thereto to the Borrower.

29

 

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

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

          (f) If the Administrative Agent or a Lender determines, in its sole
discretion, that it has received a refund of any Taxes or Other Taxes as to
which it has been indemnified by the Borrower or with respect to which the
Borrower has paid additional amounts pursuant to this Section 2.17, it shall
pay over such refund to the Borrower (but only to the extent of indemnity
payments made, or additional amounts paid, by the Borrower under this Section
2.17 with respect to the Taxes or Other Taxes giving rise to such refund), net
of all out-of-pocket expenses of the Administrative Agent or such Lender and
without interest (other than any interest paid by the relevant Governmental
Authority with respect to such refund); provided, that the Borrower, upon the
request of the Administrative Agent or such Lender, agrees to repay the amount
paid over to the Borrower (plus any penalties, interest or other charges
imposed by the relevant Governmental Authority) to the Administrative Agent or
such Lender in the event the Administrative Agent or such Lender is required to
repay such refund to such Governmental Authority. This Section shall not be
construed to require the Administrative Agent or any Lender to make available
its tax returns (or any other information relating to its taxes which it deems
confidential) to the Borrower or any other Person.

          (g) Each Lender and the Issuing Bank shall use its commercially reasonable
efforts (consistent with its internal policies and legal and regulatory
restrictions) to select a jurisdiction for its applicable lending office or
change the jurisdiction of its applicable lending office, as the case may be,
so as to avoid the imposition of any Indemnified Taxes or Other Taxes or to
eliminate or reduce the payment of any additional sums under this Section 2.17;
provided that no such selection or change of the jurisdiction for its
applicable lending office shall be made if, in the sole judgment of such Lender
or the Issuing Bank, as applicable, such selection or change would be
materially disadvantageous to such Lender or the Issuing Bank, as applicable.

          (h) If the Administrative Agent or any Lender or Issuing Bank becomes
entitled to receive payment of Indemnified Taxes, Other Taxes or additional
sums pursuant to this Section 2.17, it shall give notice and demand thereof to
the Borrower, and the Borrower (unless the Administrative Agent, Lender or
Issuing Bank shall withdraw such notice and demand or the Borrower is not
obligated to pay such amounts) shall pay such Indemnified Taxes, Other Taxes or
additional sums within 10 days after the Borrower’s receipt of such notice and
demand.

          SECTION 2.18. Payments Generally; Pro Rata Treatment; Sharing of
Set-offs. (a) The Borrower shall
make each payment required to be made by it hereunder (whether of principal,
interest, fees or reimbursement of LC Disbursements, or of amounts payable
under Section 2.15, Section 2.16 or Section 2.17, or otherwise) prior to 12:00
noon, New York City time, on the date when due, in immediately available funds,
without set-off or counterclaim. Any amounts received after such time on any
date may, in the discretion of the Administrative Agent, be deemed to have been
received on the next

30

 

succeeding Business Day for purposes of calculating
interest thereon. All such payments shall be made to the Administrative Agent
at its offices at 2 Penns Way, 1st Floor, New Castle, Delaware 19720,
Attention: Tara A. Wooster, except payments to be made directly to the Issuing
Bank as expressly provided herein and except that payments pursuant to Section
2.15, Section 2.16, Section 2.17 and Section 9.03 shall be made directly to the
Persons entitled thereto. The Administrative Agent shall distribute any such
payments received by it for the account of any other Person to the appropriate
recipient promptly following receipt thereof. If any payment hereunder shall
be due on a day that is not a Business Day, the date for payment shall be
extended to the next succeeding Business Day, and, in the case of any payment
accruing interest, interest thereon shall be payable for the period of such
extension. All payments hereunder shall be made in dollars.

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

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

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

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          (e) If any Lender shall fail to make any payment required to be made by it
pursuant to Section 2.06(e), Section 2.07(b), Section 2.18(d) or Section
9.03(c), then the Administrative Agent may, in its discretion (notwithstanding
any contrary provision hereof), apply any amounts thereafter received by the
Administrative Agent for the account of such Lender to satisfy such Lender’s
obligations under such Sections until all such unsatisfied obligations are
fully paid.

          SECTION 2.19. Mitigation Obligations; Replacement of Lenders. (a) If any Lender requests compensation under
Section 2.15, or if the Borrower is required to pay any additional amount to
any Lender or any Governmental Authority for the account of any Lender pursuant
to Section 2.17, then such Lender shall use reasonable efforts to designate a
different lending office for funding or booking its Loans hereunder or to
assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of
such Lender, such designation or assignment (i) would eliminate or reduce
amounts payable pursuant to Section 2.15 or 2.17, as the case may be, in the
future and (ii) would not subject such Lender to any un-reimbursed cost or
expense and would not otherwise be disadvantageous to such Lender. The
Borrower hereby agrees to pay all reasonable costs and expenses incurred by any
Lender in connection with any such designation or assignment.

          (b) If any Lender requests compensation under Section 2.15, or if the
Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 2.17,
or if any Lender defaults in its obligation to fund Loans hereunder, then the
Borrower may, at its sole expense and effort, upon notice to such Lender and
the Administrative Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in
Section 9.04), all its interests, rights and obligations under this Agreement
to an assignee that shall assume such obligations (which assignee may be
another Lender, if a Lender accepts such assignment); provided that (i) the
Borrower shall have received the prior written consent of the Administrative
Agent (and if a Commitment is being assigned, the Issuing Bank), which consent
shall not unreasonably be withheld, (ii) such Lender shall have received
payment of an amount equal to the outstanding principal of its Loans and
participations in LC Disbursements, accrued interest thereon, accrued fees and
all other amounts payable to it hereunder, from the assignee (to the extent of
such outstanding principal and accrued interest and fees) or the Borrower (in
the case of all other amounts) and (iii) in the case of any such assignment
resulting from a claim for compensation under Section 2.15 or payments required
to be made pursuant to Section 2.17, such assignment will result in a reduction
in such compensation or payments. A Lender shall not be required to make any
such assignment and delegation if, prior thereto, as a result of a waiver by
such Lender or otherwise, the circumstances entitling the Borrower to require
such assignment and delegation cease to apply.

          SECTION 2.20. Increase of Commitments. (a) If, prior to and after giving effect to any increase in the
Commitments pursuant to this Section 2.20, no Default, Event of Default or
Material Adverse Effect shall have occurred and be continuing, the Borrower may
at any time and from time to time, but in no event more than two (2) times in
any fiscal year, request an increase of the aggregate Commitments by notice to
the Administrative Agent in writing of the amount of such proposed increase
(such notice, a “Commitment Increase Notice”); provided, however, that (i) each
such increase shall be at least $10,000,000, (ii) the cumulative increase in
Commitments pursuant to this Section 2.20 shall not exceed $125,000,000, (iii)
the Commitment of any Lender may not be increased without such Lender’s
consent, and (iv) the aggregate amount of the Lenders’ Commitments shall not
exceed $300,000,000 without the approval of the Required Lenders. The
Administrative Agent shall, within five (5) Business Days after receipt of the
Commitment Increase Notice, notify each Lender of such request. Each Lender
desiring to increase its Commitment shall so notify the Administrative Agent in
writing no later than twenty (20) days after receipt by the Lender of such
request. Any Lender that accepts an offer to it by the Borrower to increase
its Commitment pursuant to this Section 2.20 shall, in each case, execute an
agreement (a “Commitment Increase Agreement”), in substantially the form
attached hereto as Exhibit B,

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with the Borrower and the Administrative Agent,
whereupon such Lender shall be bound by and entitled to the benefits of this
Agreement with respect to the full amount of its Commitment as so increased,
and the definition of Commitment in Section 1.01 and Schedule 2.01 hereof shall
be deemed to be amended to reflect such increase. Any Lender that does not
notify the Administrative Agent within such period that it will increase its
Commitment shall be deemed to have rejected such offer to increase its
Commitment. No Lender shall have any obligation whatsoever to agree to
increase its Commitment. Any agreement to increase a Lender’s pro rata share
of the increased Commitment shall be irrevocable and shall be effective upon
notice thereof by the Administrative Agent at the same time as that of all
other increasing Lenders.

          (b) If any portion of the increased Commitments is not subscribed for by
such Lenders, the Borrower may, in its sole discretion, but with the consent of
the Administrative Agent as to any Person that is not at such time a Lender
(which consent shall not be unreasonably withheld or delayed), offer to any
existing Lender or to one or more additional banks or financial institutions
the opportunity to participate in all or a portion of such unsubscribed portion
of the increased Commitments pursuant to paragraph (c) below by notifying the
Administrative Agent. Promptly and in any event within five (5) Business Days
after receipt of notice from the Borrower of its desire to offer such
unsubscribed commitments to certain existing Lenders, to the additional banks
or to financial institutions identified therein or such additional banks or
financial institutions identified by the Administrative Agent and approved by
the Borrower, the Administrative Agent shall notify such proposed lenders of
the opportunity to participate in all or a portion of such unsubscribed portion
of the increased Commitments.

          (c) Any additional bank or financial institution that the Borrower selects
to offer participation in the increased Commitments shall execute and deliver
to the Administrative Agent a New Lender Agreement (a “New Lender Agreement”),
in substantially the form attached hereto as Exhibit C, setting forth its
Commitment, and upon the effectiveness of such New Lender Agreement such bank
or financial institution (a “New Lender”) shall become a Lender for all
purposes and to the same extent as if originally a party hereto and shall be
bound by and entitled to the benefits of this Agreement, and the signature
pages hereof shall be deemed to be amended to add the name of such New Lender
and the definition of Commitment in Section 1.01 and Schedule 2.01 hereof shall
be deemed amended to increase the aggregate Commitments of the Lenders by the
Commitment of such New Lender, provided that the Commitment of any New Lender
shall be an amount not less than $5,000,000. Each New Lender Agreement shall
be irrevocable and shall be effective upon notice thereof by the Administrative
Agent at the same time as that of all other New Lenders.

          (d) The effectiveness of any New Lender Agreement or Commitment Increase
Agreement shall be contingent upon receipt by the Administrative Agent of such
corporate resolutions of the Borrower and legal opinions of counsel to the
Borrower as the Administrative Agent shall reasonably request with respect
thereto, in each case in form and substance reasonably satisfactory to the
Administrative Agent. Once a New Lender Agreement or Commitment Increase
Agreement becomes effective, the Administrative Agent shall reflect the
increases in the Commitments effected by such agreements by appropriate entries
in the Register.

          (e) If any bank or financial institution becomes a New Lender pursuant to
Section 2.20(c) or any Lender’s Commitment is increased pursuant to Section
2.20(a), additional Revolving Loans made on or after the effectiveness thereof
(the “Re-Allocation Date”) shall be made pro rata based on their respective
Commitments in effect on or after such Re-Allocation Date (except to the extent
that any such pro rata borrowings would result in any Lender making an
aggregate principal amount of Revolving Loans in excess of its Commitment, in
which case such excess amount will be allocated to, and made by, such New
Lender and/or Lenders with such increased Commitments to the extent of, and pro
rata based on, their respective Commitments), and continuations of Loans
outstanding on such Re-Allocation Date shall be effected by repayment of such
Loans on the last day of the Interest Period

33

 

applicable thereto or, in the case
of ABR Loan, on the date of such increase, and the making of new Loans of the
same Type pro rata based on the respective Commitments in effect on and after
such Re-Allocation Date.

          (f) If on any Re-Allocation Date there is an unpaid principal amount of
Eurodollar Loans, such Eurodollar Loans shall remain outstanding with the
respective holders thereof until the expiration of their respective Interest
Periods (unless the Borrower elects to prepay any thereof in accordance with
the applicable provisions of this Agreement), and interest on and repayments of
such Eurodollar Loans will be paid thereon to the respective Lenders holding
such Eurodollar Loans pro rata based on the respective principal amounts
thereof outstanding.

ARTICLE III

Representations and Warranties

          The Borrower represents and warrants to the Lenders that:

          SECTION 3.01. Organization; Powers. Each Loan Party and each general partner or managing member of each
Loan Party is (i) duly organized, validly existing and in good standing under
the laws of the jurisdiction of its organization, (ii) has all requisite power
and authority to carry on its business as now conducted, and (iii) is qualified
to do business in, and is in good standing in, every jurisdiction where such
qualification is required, 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,.

          SECTION 3.02. Authorization; Enforceability.. The Transactions are within each Loan Party’s corporate,
partnership or limited liability company powers and have been duly authorized
by all necessary corporate, partnership or limited liability company action.
This Agreement and each Loan Document have been duly executed and delivered by
the Loan Party(ies) thereto and constitute legal, valid and binding obligations
of such Loan Party(ies) thereto, enforceable in accordance with their terms,
subject to applicable bankruptcy, insolvency, reorganization, moratorium or
other laws affecting creditors’ rights generally and subject to general
principles of equity, regardless of whether considered in a proceeding in
equity or at law.

          SECTION 3.03. No Undisclosed Liabilities. The Loan Parties have no material liabilities or obligations of
any nature except for (i) liabilities or obligations reflected or reserved
against in the financial statements described in Section 3.05 below or in the
financial statements most recently delivered by the Parent (or, if a Parent
Event has occurred, the Borrower) pursuant to Section 5.01, as applicable, (ii)
current liabilities incurred in the ordinary course of business since the date
of such financial statements, (iii) liabilities or obligations that are not
required to be included in financial statements prepared in accordance with
GAAP, and (iv) those set forth in Schedule 3.03 attached to this Agreement or
previously disclosed in the Parent’s filings with the SEC or otherwise
disclosed in writing to the Administrative Agent and the Lenders.

          SECTION 3.04. Governmental Approvals; No Conflicts. The Transactions (a) do not require any consent or
approval of, registration or filing with, or any other action by, any
Governmental Authority, except such as have been obtained or made and are in
full force and effect, (b) will not violate any applicable law or regulation or
the charter, by-laws or other organizational documents of any Loan Party or any
order of any Governmental Authority, (c) will not violate or result in a
default under any indenture, agreement or other instrument binding upon any
Loan Party or its assets, or give rise to a right thereunder to require any
payment to be made by any Loan Party, and (d) will not result in the creation
or imposition of any Lien on any asset of the Borrower or any Loan Party.

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          SECTION 3.05. Financial Condition; No Material Adverse Change. (a) The Borrower has heretofore furnished to
the Lenders the Parent’s consolidated balance sheet and statements of income
and cash flows (i) as of and for the fiscal year ended 2003, reported on by
Ernst & Young L.L.P., independent public accountants, and (ii) as of and for
the fiscal quarter and the portion of the fiscal year ended June 30, 2004,
certified by its chief financial officer. Such financial statements present
fairly, in all material respects, the financial position and results of
operations and cash flows of the Parent and its consolidated Subsidiaries as of
such dates and for such periods in accordance with GAAP, subject to year-end
audit adjustments and the absence of footnotes in the case of the statements
referred to in clause (ii) above.

          (b) Since December 31, 2003, no event has occurred that could reasonably
expected to have a Material Adverse Effect.

          SECTION 3.06. Properties. (a) Each Loan Party has good title to, or valid leasehold interests in, all its
real and personal property material to its business, except for such defects in
title that would not reasonably be expected to have a Material Adverse Effect.

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

          SECTION 3.07. Litigation and Environmental Matters. (a) There are no actions, suits or proceedings by or
before any arbitrator or Governmental Authority pending against or, to the
knowledge of the Borrower, threatened against or affecting any Loan Party (i)
as to which there is a reasonable possibility of an adverse determination and
that, if adversely determined, would reasonably be expected, individually or in
the aggregate, to result in a Material Adverse Effect (other than the Disclosed
Matters) or (ii) that involve this Agreement or the Transactions.

          (b) Except for the Disclosed Matters and except with respect to any other
matters that, individually or in the aggregate, would not reasonably be
expected to result in a Material Adverse Effect, no Loan Party (i) has failed
to comply with any Environmental Law or to obtain, maintain or comply with any
permit, license or other approval required under any Environmental Law, (ii)
has become subject to any Environmental Liability, (iii) has received notice of
any claim with respect to any Environmental Liability or (iv) knows of any
basis for any Environmental Liability.

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

          SECTION 3.08. Compliance with Laws and Agreements. Each Loan Party is in compliance with all laws,
regulations and orders of any Governmental Authority applicable to it or its
property and all indentures, agreements and other instruments binding upon it
or its property, except where the failure to do so, individually or in the
aggregate, could not reasonably be expected to result in a Material
Adverse Effect. No Default has occurred and is continuing.

          SECTION 3.09. Investment and Holding Company Status. No Loan Party is (a) an “investment company” as defined
in, or subject to regulation under, the Investment Company Act of 1940 or (b) a
“holding company” as defined in, or subject to regulation under, the Public
Utility Holding Company Act of 1935.

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          SECTION 3.10. Taxes. Each Loan Party has timely filed or caused to be filed all Tax returns and reports
required to have been filed and has paid or caused to be paid all Taxes
required to have been paid by it, except (a) Taxes that are being contested in
good faith by appropriate proceedings and for which such Loan Party has set
aside on its books adequate reserves or (b) to the extent that the failure to
do so could not reasonably be expected to result in a Material Adverse Effect.

          SECTION 3.11. ERISA. No ERISA Event has occurred or is reasonably expected to occur that, when taken together
with all other such ERISA Events for which liability is reasonably expected to
occur, could reasonably be expected to result in a Material Adverse Effect.
The present value of all accumulated benefit obligations under each Plan (based
on the assumptions used for purposes of Statement of Financial Accounting
Standards No. 87) did not, as of the date of the most recent financial
statements reflecting such amounts, exceed the fair market value of the assets
of such Plan by an amount that would reasonably be expected to have a Material
Adverse Effect, and the present value of all accumulated benefit obligations of
all underfunded Plans (based on the assumptions used for purposes of Statement
of Financial Accounting Standards No. 87) did not, as of the date of the most
recent financial statements reflecting such amounts, exceed the fair market
value of the assets of all such underfunded Plans by an amount that would
reasonably be expected to have a Material Adverse Effect.

          SECTION 3.12. Disclosure. The Borrower has disclosed to the Lenders all agreements, instruments and corporate
or other restrictions to which any Loan Party is subject, and all other matters
known to it, that, individually or in the aggregate, could reasonably be
expected to result in a Material Adverse Effect. Neither the Information
Memorandum nor any of the other reports, financial statements, certificates or
other information furnished by or on behalf of the Borrower to the
Administrative Agent or any Lender in connection with the negotiation of this
Agreement or delivered hereunder (as modified or supplemented by other
information so furnished) contains any material misstatement of fact or omits
to state any material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading; provided
that, with respect to projected financial information, the Borrower represents
only that such information was prepared in good faith based upon assumptions
believed to be reasonable at the time.

          SECTION 3.13. Labor Matters. There are no strikes, lockouts or slowdowns against any Loan Party pending or,
to the knowledge of the Borrower, threatened that could reasonably be expected
to have a Material Adverse Effect. The hours worked by and payments made to
employees of the Borrower and its Subsidiaries have not been in violation of the Fair Labor Standards Act or any other Law
dealing with such matters to the extent that such violation could reasonably be
expected to have a Material Adverse Effect.

          SECTION 3.14. Subsidiaries. Schedule 3.14 lists, for each Subsidiary of the Borrower as of the date hereof,
its full legal name, its jurisdiction of organization, the number of shares of
capital stock or other Equity Interests outstanding and the owner(s) of such
shares or Equity Interests. As of the date hereof, Parent is the sole member
of the Borrower and the Borrower is the sole Subsidiary of the Parent.

          SECTION 3.15. Margin Stock. No Loan Party is engaged principally, or as one of its important activities, in
the business of extending credit for the purpose of purchasing or carrying
margin stock (within the meaning of Regulation T, U or X of the Board), and no
part of the proceeds of any Loan will be used to purchase or carry any margin
stock in violation of said Regulation T, U or X or to extend credit to others
for the purpose of purchasing or carrying margin stock in violation of said
Regulation T, U or X.

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          SECTION 3.16. Licenses and Permits. Each Loan Party possesses all licenses, permits, authorizations,
registrations, approvals and similar rights necessary under Law for such Person
to conduct its operations as now being conducted, each of such licenses,
permits, authorizations, registrations, approvals and similar rights is valid
and subsisting, in full force and effect and enforceable by such Person, and
such Person is in compliance with all terms, conditions or other provisions of
such permits, authorizations, registrations, approvals and similar rights
except where, in each case, such failure to possess, such invalidity, or such
noncompliance would not reasonably be expected to have a Material Adverse
Effect.

          SECTION 3.17. Reportable Transaction. The Borrower does not intend to treat the Loans as being a “reportable
transaction” (within the meaning of Treasury Regulation Section 1.6011-4). In
the event the Borrower determines to take any action inconsistent with such
intention, it will promptly notify the Administrative Agent thereof.
Furthermore, the Borrower acknowledges that one or more of the Lenders may
treat its Loans as part of a transaction that is subject to Treasury Regulation
Section 1.6011-4 or Section 301.6112-1, and the Administrative Agent and such
Lender or Lenders, as applicable, may file such IRS forms or maintain such
lists and other records as they may determine are required by such Treasury
Regulations.

          SECTION 3.18. Public Utility Holding Company Act. No Loan Party is a non-exempt “holding company,” or
subject to regulation as such, or, to the knowledge of the Borrower’s or such
Subsidiary’s officers, an “affiliate” of a “holding company” or a “subsidiary
company” of a “holding company,” within the meaning of the Public Utility
Holding Company Act of 1935, as amended.

          SECTION 3.19. Senior Debt Status. As of the Effective Date, all Indebtedness outstanding under the Loan
Documents constitutes senior Indebtedness of the Borrower and ranks at least
pari passu in priority of payment with all other Indebtedness owed by the
Borrower, except Indebtedness of the Borrower which may be secured by Permitted
Encumbrances permitted pursuant to Section 6.02.

          SECTION 3.20. Leases. Each Lease to which any Loan Party is a party is in full force and effect and there
is no default thereunder and no event has occurred or is occurring which after
notice or lapse of time or both will result in such default, except for
defaults which could not reasonably be expected to have a Material Adverse
Effect. Each lessee under the Leases is paying royalties currently due under
its respective Lease directly to Borrower or its Subsidiaries and, with the
exception of payment of the minimum royalties required thereunder, lessee has
not prepaid any sums payable by any lessee under any of the Leases, except to
the extent such non-payment or prepayment could not reasonably be expected to
have a Material Adverse Effect. No Lessee under a Lease or group of Leases
which constitute a Material Contract is more than thirty (30) days past due
with respect to the payment of royalties under its respective Lease(s) and,
with the exception of payment of the minimum royalties required thereunder, no
such lessee has prepaid any sums payable by such lessee under any of such
Leases more than thirty (30) days in advance. There is no consent or approval
required under any Lease with respect to this Agreement or the consummation of
the Transactions which has not been obtained.

          SECTION 3.21. Solvency. After giving effect to the Loans and the terms of this Agreement, the Borrower is,
and will be, individually and together with (i) its Subsidiaries, and (ii)
prior to the occurrence of a Parent Event, the Parent, Solvent.

          SECTION 3.22. Foreign Assets Control Regulation. Borrower’s use of the proceeds of the Loans will not
violate the Trading with the Enemy Act, as amended, or any of the foreign
assets control regulations of the United States Treasury Department (31 CFR,
Subtitle B, Chapter V, as amended) or any enabling legislation or executive
order relating thereto.

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          SECTION 3.23. Representations Regarding the Parent. Prior to the occurrence of a Parent Event (i) the Parent
has not amended its charter or by-laws or other constituent documents in any
manner that would materially and adversely affect the rights of the Lenders
under this Agreement or their ability to enforce the same; (ii) the Parent has
not changed the end of its fiscal year to a date other than December 31; (iii)
the Parent has not engaged in any business that a master limited partnership
would not be entitled to engage in pursuant to applicable Law; (iv) the Parent
has not made any changes to the Omnibus Agreement that the Borrower and its
Subsidiaries would be prohibited from making pursuant to Section 6.15 of this
Agreement; and (v) the Parent has kept proper books of record and account in
which full, true and correct entries have been made of all dealings and
transactions in relation to its business and activities.

ARTICLE IV

Conditions

          SECTION 4.01. Effective Date. The obligations of the Lenders to make Loans and of the Issuing Bank to issue
Letters of Credit hereunder shall not become effective until the date on which
each of the following conditions is satisfied (or waived in accordance with
Section 9.02):

          (a) The Administrative Agent (or its counsel) shall have received from
each party hereto either (i) a counterpart of this Agreement, a Guaranty
Agreement executed by each of the Guarantors and all other documents required
by Lender in connection with this Agreement signed on behalf of such party or
(ii) written evidence satisfactory to the Administrative Agent (which may
include telecopy transmission of a signed signature page of this Agreement)
that such party has signed a counterpart of this Agreement and all other
documents required by Lender in connection with this Agreement.

          (b) The Administrative Agent shall have received a favorable written
opinion (addressed to the Administrative Agent and the Lenders and dated the
Effective Date) of Vinson Elkins, LLP, counsel for the Borrower, relating to
the Parent, the Borrower and its Subsidiaries, this Agreement or the
Transactions and any other matters as the Required Lenders shall reasonably
request. The Borrower hereby requests such counsel to deliver such opinion.

          (c) The Administrative Agent shall have received a favorable written
opinion (addressed to the Administrative Agent and the Lenders and dated the
Effective Date) of the general counsel of the Borrower, relating to the Parent,
the Borrower and its Subsidiaries, this Agreement or the Transactions and any
other matters as the Required Lenders shall reasonably request.

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

          (e) The Administrative Agent shall have received a certificate, dated the
Effective Date and signed by the President, a Vice President or a Financial
Officer of the Borrower, confirming compliance with the conditions set forth in
paragraphs (a) and (b) of Section 4.02.

          (f) The Administrative Agent and the Joint Lead Arrangers and Joint
Bookrunners shall have received all fees and other amounts due and payable on
or prior to the Effective Date,

38

 

including, to the extent invoiced,
reimbursement or payment of all out-of-pocket expenses required to be
reimbursed or paid by the Borrower hereunder.

          (g) The Lenders shall have received (i) satisfactory audited consolidated
financial statements of the Parent and its Subsidiaries for the period ended
December 31, 2003 and for the period from the commencement of operations
(October 17, 2002) to December 31, 2002, and (ii) satisfactory unaudited
interim consolidated financial statements of the Borrower for each quarterly
period ended subsequent to the date of the latest financial statements
delivered pursuant to clause (i) immediately above as to which such financial
statements are available.

          (h) The Administrative Agent shall have received satisfactory evidence
that the Prior Credit Agreement has been terminated and of the occurrence of
the following with respect to the Prior Credit Agreement: (i) all obligations
owing to any lender, agent or any other Person thereunder shall have been paid
in full and all commitments of any lender, agent or any other Person thereunder
to make any future loans shall have been terminated, and (ii) each Letter of
Credit issued thereunder shall have been terminated or canceled, or the Issuer
thereof shall have accepted cash collateral or a Letter of Credit as security
therefor.

          (i) Each of the Guarantors shall have executed and delivered to the
Administrative Agent for the benefit of the Lenders a Guaranty Agreement
substantially in the form of Exhibit “D” attached hereto.

          (j) No event shall have occurred with respect to the Parent, the Borrower
and its Subsidiaries, taken as a whole, which has had, or could reasonably be
expected to have, a Material Adverse Effect.

     The Administrative Agent shall notify the Borrower and the Lenders of the
Effective Date, and such notice shall be conclusive and binding.
Notwithstanding the foregoing, the obligations of the Lenders to make Loans and
of the Issuing Bank to issue Letters of Credit hereunder shall not become
effective unless each of the foregoing conditions is satisfied (or waived
pursuant to Section 9.02) at or prior to 3:00 p.m., New York City time, on
October 29, 2004 (and, in the event such conditions are not so satisfied or
waived, the Commitments shall terminate at such time).

          SECTION 4.02. Each Credit Event. The obligation of each Lender to make a Loan on the occasion of any Borrowing,
and of the Issuing Bank to issue, amend, renew or extend any Letter of Credit,
is subject to the satisfaction of the following conditions:

          (a) The representations and warranties of the Borrower set forth in this
Agreement shall be true and correct on and as of the date of such Borrowing or
the date of issuance, amendment, renewal or extension of such Letter of Credit,
as applicable, except to the extent any such representation or warranty is
stated to relate to an earlier date in which case such representation and
warranty will be true and correct on and as of such earlier date.

          (b) At the time of and immediately after giving effect to such Borrowing
or the issuance, amendment, renewal or extension of such Letter of Credit, as
applicable, no Default or Event of Default shall have occurred and be
continuing.

Each Borrowing and each issuance, amendment, renewal or extension of a Letter
of Credit shall be deemed to constitute a representation and warranty by the
Borrower on the date thereof as to the matters specified in paragraphs (a) and
(b) of this Section.

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ARTICLE V

Affirmative Covenants

          Until the Commitments have expired or been terminated and the principal of
and interest on each Loan and all fees payable hereunder shall have been paid
in full and all Letters of Credit shall have expired or terminated and all LC
Disbursements shall have been reimbursed, the Borrower covenants and agrees
with the Lenders that:

          SECTION 5.01. Financial Statements; Ratings Change and Other
Information. The Borrower will
furnish to the Administrative Agent and each Lender:

          (a) within 90 days after the end of each fiscal year of the Parent (or, if
a Parent Event has occurred, the Borrower), on EDGAR (or (i) upon the request
of any Lender, the Borrower shall provide a copy of such statement or report
described below to any Lender that does not have access to EDGAR, or (ii) if a Parent Event has occurred or such statement or report
is no longer available on EDGAR for any reason, a copy of such statement or
report described below to each Lender and the Administrative Agent), the
Parent’s (or, if a Parent Event has occurred, the Borrower’s) audited
consolidated balance sheet and related statements of operations, partners’
capital and cash flows as of the end of and for such year, setting forth in
each case in comparative form the figures for the previous fiscal year, all
reported on by Ernst & Young L.L.P. or other independent public accountants of
recognized national standing (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 and results of operations of
the Parent, the Borrower and its consolidated Subsidiaries (or, if a Parent
Event has occurred, the Borrower and its consolidated Subsidiaries) on a
consolidated basis in accordance with GAAP consistently applied;

          (b) within 45 days after the end of each of the first three fiscal
quarters of each fiscal year of the Parent on EDGAR (or (i) upon the request of
any Lender, the Borrower shall provide a copy of such statement or report
described below to any Lender that does not have access to EDGAR, or (ii) if a
Parent Event has occurred or such statement or report is no longer available on
EDGAR for any reason, a copy of such statement or report described below to
each Lender and the Administrative Agent), the Parent’s (or, if a Parent Event
has occurred, the Borrower’s) consolidated balance sheet and related statements
of operations and cash flows as of the end of and for such fiscal quarter and
the then elapsed portion of the fiscal year, setting forth in each case in
comparative form the figures for the corresponding period or periods of (or, in
the case of the balance sheet, as of the end of) the previous fiscal year, all
certified by one of the Parent’s (or, if a Parent Event has occurred, the
Borrower’s) Financial Officers as presenting fairly in all material respects
the financial condition and results of operations of the Parent, the Borrower
and its consolidated Subsidiaries (or, if a Parent Event has occurred, the
Borrower and its consolidated Subsidiaries) on a consolidated basis in
accordance with GAAP consistently applied, subject to normal year-end audit
adjustments and the absence of footnotes;

          (c) concurrently with any delivery of financial statements under clause
(a) or (b) above, a certificate of a Financial Officer of the Borrower (i)
certifying as to whether a Default has occurred and, if a Default has occurred,
specifying the details thereof and any action taken or proposed to be taken
with respect thereto, (ii) setting forth reasonably detailed calculations
demonstrating compliance with Section 6.17 and Section 6.18, and (iii) stating
whether any change in GAAP or in the application thereof has occurred since the
date of the last audited financial statements delivered pursuant to Section
5.01(a) above and, if any such change has occurred, specifying the effect of
such change on the financial statements accompanying such certificate;

40

 

          (d) promptly after the same become publicly available, on EDGAR (or (i)
upon the request of any Lender, the Borrower shall provide a copy of such
statement or report described below to any Lender that does not have access to
EDGAR, or (ii) if a Parent Event has occurred or such statement or report is no
longer available on EDGAR for any reason, a copy of such statement or report
described below to each Lender and the Administrative Agent) copies of all
periodic and other reports, proxy statements and other materials filed by the
Parent, the Borrower or any Subsidiary with the SEC, or with any national
securities exchange, as the case may be; and

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

          SECTION 5.02. Notices of Material Events. The Borrower will furnish to the Administrative Agent and each
Lender prompt written notice of the following:

          (a) the occurrence of any Default of which Borrower has, or could
reasonably be expected to have, knowledge;

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

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

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

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

          SECTION 5.03. Existence; Conduct of Business. The Borrower will, and will cause each of its Subsidiaries to,
do or cause to be done all things necessary to preserve, renew and keep in full
force and effect its legal existence and the rights, licenses, permits,
privileges and franchises material to the conduct of its business except where
the failure to do so in each case could not reasonably be expected to have a
Material Adverse Effect; provided that the foregoing shall not prohibit any
merger, consolidation, liquidation or dissolution permitted under Section 6.03.

          SECTION 5.04. Payment of Obligations. The Borrower will cause each of its Subsidiaries to, pay its
obligations before the same shall become delinquent or in default, including
Tax liabilities, that, if not paid, could result in a Material Adverse Effect,
except where (a) the validity or amount thereof is being contested in good
faith by appropriate proceedings, (b) the Borrower or such Subsidiary has set
aside on its books adequate reserves with respect thereto in accordance with
GAAP, and (c) the failure to make payment pending such contest could not
reasonably be expected to result in a Material Adverse Effect.

41

 

          SECTION 5.05. Maintenance of Properties; Insurance. The Borrower will, and will cause each of its Subsidiaries
to, (a) keep and maintain all property material to the conduct of its business
in good working order and condition in accordance with industry practice,
ordinary wear and tear excepted, and (b) maintain, with financially sound and
reputable insurance companies, insurance in such amounts and against such risks
as are customarily maintained by companies engaged in the same or similar
businesses operating in the same or similar locations.

          SECTION 5.06. Books and Records; Inspection Rights. The Borrower will, and will cause each of its Subsidiaries
to, keep proper books of record and account in which full, true and correct
entries are made of all dealings and transactions in relation to its business
and activities. The Borrower will, and will cause each of its Subsidiaries to,
permit any representatives designated by the Administrative Agent or any
Lender, upon reasonable prior notice and subject to applicable safety rules and
regulations, to visit and inspect its properties, to examine and make extracts
from its books and records, and to discuss its affairs, finances and condition
with its officers and independent accountants, all at such reasonable times and
as often as reasonably requested.

          SECTION 5.07. Compliance with Laws. The Borrower will, and will cause each of its Subsidiaries to, comply
with all laws, rules, regulations and orders of any Governmental Authority
applicable to it or its property, except where the failure to do so,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect.

          SECTION 5.08. Use of Proceeds and Letters of Credit. The proceeds of the Loans will be used only (i) to repay
amounts outstanding under the Prior Credit Agreement; (ii) to pay the fees,
expenses and other transaction costs of the Transactions contemplated hereby;
and (iii) to fund working capital needs, (iii) to fund acquisitions permitted
hereunder and engage in other transactions permitted hereby, and (iv) for
general corporate purposes of the Borrower and its Subsidiaries. No part of
the proceeds of any Loan will be used, whether directly or indirectly, for any
purpose that entails a violation of any of the regulations of the Board,
including Regulations T, U and X. Letters of Credit will be issued only to
support the working capital needs and general corporate obligations of the
Borrower and its Subsidiaries relating to their respective lines of business.

          SECTION 5.09. Compliance with ERISA. In addition to and without limiting the generality of Section 5.07, the
Borrower shall, and shall cause its Subsidiaries to, (a) comply in all material
respects with all applicable provisions of ERISA and the regulations and
published interpretations thereunder with respect to all employee benefit plans
(as defined in ERISA), (b) not take any action or fail to take action the
result of which could be (i) a liability to the PBGC or (ii) a past due
liability to any Multiemployer Plan, (c) not participate in any prohibited
transaction that could result in any civil penalty under ERISA or any tax under
the Code, and (d) operate each employee benefit plan in such a manner that will
not incur any tax liability under Section 4980B of the Code or any liability to
any qualified beneficiary as defined in Section 4980B of the Code except to the
extent, in each case, where the failure to do so would not reasonably be
expected to result in a Material Adverse Effect. The Borrower shall, and shall
cause its Subsidiaries to, furnish to the Administrative Agent upon the
Administrative Agent’s request such additional information about any employee
benefit plan sponsored, maintained or contributed to by any of said Persons
and/or the Parent, as may be reasonably requested by the Administrative Agent.

          SECTION 5.10. Intentionally Deleted

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          SECTION 5.11. Compliance with Environmental Laws; Environmental
Reports. (i) In addition to and without limiting the generality of Section 5.07, the Borrower shall, and shall
cause its Subsidiaries to, (i) comply in all material respects with all
Environmental Laws applicable to its operations and real property except where the failure to
do so, individually or in the aggregate, could not reasonably be expected to
have a Material Adverse Effect; (ii) obtain and renew all material Governmental
Approvals required under Environmental Laws applicable to its operations and
real property except where the failure to do so, individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect;
and (iii) conduct any Response legally required by Borrower or any of its
Subsidiaries in accordance with applicable Environmental Laws except where the
failure to do so, individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect.

          SECTION 5.12. Further Assurances. The Borrower will, and will cause its Subsidiaries to, at its own cost
and expense, to promptly (i) correct any material defect or error that may be
discovered in any Loan Document or in the execution, acknowledgment, filing or
recordation thereof and (ii) do, execute, acknowledge, deliver, record,
re-record, file, re-file, register and re-register any and all such further
acts, deeds, certificates, assurances and other instruments the Administrative
Agent may reasonably require from time to time in order to carry out more
effectively the purposes of the Loan Documents.

          SECTION 5.13. Tax Shelter Regulations. If the Borrower determines to take any action inconsistent with Section
3.17, the Borrower will promptly notify the Administrative Agent thereof and
will promptly deliver to the Administrative Agent a duly completed copy of IRS
Form 8886 (or any successor form). The Borrower acknowledges that, upon any
such notification, any Lender may treat its Loans hereunder as part of a
transaction that is subject to Treasury Regulation Section 301.6112-1, and such
Lender will maintain the lists and other records required by such Treasury
Regulation.

          SECTION 5.14. Leases; Material Contracts. The Borrower will perform and observe, or cause to be performed
and observed, all of the covenants and conditions required to be performed by
it or any of its Subsidiaries under each Lease, except where such failure could
not reasonably be expected to have a Material Adverse Effect. The Borrower
will promptly notify the Administrative Agent in writing of the receipt by the
Borrower or any Subsidiary of any notice from any third party to the Borrower
or any Subsidiary of any material default under, or the termination of, any
Material Contract pursuant to the provisions of such Material Contract, and
will promptly cause a copy of each such notice received by the Borrower or any
Subsidiary from any third party to be delivered to the Administrative Agent.
The Borrower will not, nor will it permit any Subsidiary to, without the prior
written consent of the Required Lenders, terminate or surrender, or suffer or
permit any termination or surrender, of any Material Contract during the
initial term thereof or any valid extension thereto.

          SECTION 5.15. Clean-Down Period. The Borrower will cause the aggregate outstanding principal balance of
Distribution Loans to be zero for a period of at least fifteen (15) consecutive
days during each twelve month period.

          SECTION 5.16. Guaranties. Immediately upon the formation or acquisition of any entity which meets the
definition of a Guarantor, such Guarantor shall execute and deliver to the
Administrative Agent for the benefit of the Lenders a Guaranty Agreement
substantially in the form of Exhibit “D” attached hereto.

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ARTICLE VI

Negative Covenants

          Until the Commitments have expired or terminated and the principal of and
interest on each Loan and all fees payable hereunder have been paid in full and
all Letters of Credit have expired or terminated and all LC Disbursements shall
have been reimbursed, the Borrower covenants and agrees with the Lenders that:

          SECTION 6.01. Indebtedness. The Borrower will not, and will not permit any Subsidiary to, create, incur, assume
or permit to exist any Indebtedness, except:

          (a) Indebtedness created hereunder;

          (b) unsecured Indebtedness of the Borrower so long as the incurrence or
maintenance of such Indebtedness does not cause a Default or an Event of
Default under any other provision of this Agreement;

          (c) Indebtedness existing on the date hereof and set forth in Schedule
6.01, and any extensions, refinancing, renewals or replacements of any such
Indebtedness; provided that such Indebtedness is not increased in connection
therewith except for increases in an amount equal to a reasonable premium or
other reasonable amount paid, and fees and expenses reasonably incurred, in
connection with such extension, renewal, refinancing, or replacement and in an
amount equal to any existing commitments unutilized thereunder, and is not
secured by any additional assets;

          (d) purchase money Indebtedness (including Capital Lease Obligations) of
the Subsidiaries representing the portion of the purchase price of any office
equipment, data processing equipment (including, without limitation, computer
and computer peripheral equipment), trucks, tractors, trailers and other
transportation equipment which may be secured by Liens permitted under Section
6.02; provided that the aggregate principal amount of Indebtedness permitted by
this clause (d) shall not exceed $10,000,000 at any time outstanding;

          (e) any Indebtedness incurred or assumed in connection with any
transaction or acquisition permitted by Section 6.19 hereof;

          (f) Indebtedness of the Borrower to any Subsidiary and of any Subsidiary
to the Borrower or any other Subsidiary;

          (g) Guarantees by the Borrower of Indebtedness of any Subsidiary and by
any Subsidiary of Indebtedness of the Borrower or any other Subsidiary;

          (h) Indebtedness consisting of surety bonds that the Borrower or any
Subsidiary is required to obtain in order to comply with applicable Law or the
requirements of any Governmental Authority.

          SECTION 6.02. Liens. The Borrower will not, and will not permit any Subsidiary to, create, incur, assume
or permit to exist any Lien on any property or asset now owned or hereafter
acquired by it, or assign or sell any income or revenues (including accounts
receivable) or rights in respect of any thereof, except:

          (a) Permitted Encumbrances;

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          (b) any Lien on any property or asset of the Borrower or any Subsidiary
existing on the date hereof and set forth in Schedule 6.02; provided that (i)
such Lien shall not apply to any other property or asset of the Borrower or any
Subsidiary and (ii) such Lien shall secure only those obligations which it
secures on the date hereof and any extensions, renewals and replacements
thereof;

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

          (d) Liens securing the Indebtedness permitted by clause (d) of Section
6.01 and placed on the property described therein contemporaneously with the
purchase thereof or within 90 days thereafter, by the Borrower or any of its
Subsidiaries to secure all or a portion of the purchase price thereof; provided
that such Lien shall not extend to any other property or assets of the Borrower
or its Subsidiaries;

          (e) Liens on fixed or capital assets acquired, constructed or improved by
the Borrower or any Subsidiary; provided that (i) such security interests and
the Indebtedness secured thereby are incurred prior to or within 180 days after
such acquisition or the completion of such construction or improvement, (ii)
the Indebtedness secured thereby does not exceed 100% of the cost of acquiring,
constructing or improving such fixed or capital assets and (iii) such security
interests shall not apply to any other property or assets of the Borrower or
any Subsidiary;

          (f) any interest or title of a lessor under any lease entered into by the
Borrower or any of its Subsidiaries in the ordinary course of its business and
covering only the assets so leased, and any interest of a landowner in the case
of easements entered into by the Borrower or any of its Subsidiaries in the
ordinary course of its business and covering only the property subject to the
easement;

          (g) Liens not otherwise permitted by this Section so long as the aggregate
outstanding principal amount of the obligations secured thereby does not exceed
(as to the Borrower and all its Subsidiaries) $15,000,000 at any one time;

          (h) any Lien created or assumed by the Borrower or any Subsidiary in
connection with the issuance of Indebtedness, the interest on which is
excludable from gross income of the holder of such Indebtedness pursuant to the
Code, for the purpose of financing, in whole or in part, the acquisition or
construction of property or assets to be used by the Borrower or its
Subsidiaries;

          (i) Liens on any additions, improvements, replacements, repairs, fixtures,
appurtenances or component parts thereof attaching to or required to be
attached to property or assets pursuant to the terms of any mortgage, pledge agreement, security
agreement or other similar instrument, creating a Lien upon such property or
asset otherwise permitted under this Section;

          (j) any Liens arising out of the refinancing, extension, renewal or
refunding of any Indebtedness secured by any Lien permitted by any of the
foregoing clauses of this Section, provided that such Indebtedness is not
increased except for increases in an amount equal to a reasonable premium or
other reasonable amount paid, and fees and expenses reasonably incurred, in
connection with such

45

 

extension, renewal, refinancing, or replacement and in an
amount equal to any existing commitments unutilized thereunder, and is not
secured by any additional assets; and

          (k) Liens securing Indebtedness permitted by Section 6.01(e); provided
that the Indebtedness secured thereby does not exceed 100% of the fair market
value of the assets or Equity Interests acquired in such transaction or
acquisition.

          SECTION 6.03. Fundamental Changes. Neither the Borrower nor any Subsidiary will merge or consolidate with
or into any other Person nor shall any Subsidiary liquidate or dissolve, except
that if before and after giving effect to such merger or consolidation, there
exists no Default or Event of Default (A) the Borrower or any Subsidiary may
merge or consolidate with any Person so long as the Borrower or such Subsidiary
is the surviving Person; (B) a Subsidiary may merge into the Borrower in a
transaction in which the Borrower is the surviving Person; (C) a Subsidiary may
merge into any other Subsidiary; and (D) any Subsidiary may liquidate or
dissolve if such liquidation or dissolution is in the best interests of the
Borrower and is not materially disadvantageous to the Lenders.

          SECTION 6.04. Investments, Loans, Advances and Guarantees. The Borrower will not, and will not permit any of
its Subsidiaries to, purchase, hold or acquire (including pursuant to any
merger with any Person that was not a wholly-owned Subsidiary prior to such
merger) any capital stock, evidences of indebtedness or other securities
(including any option, warrant or other right to acquire any of the foregoing)
of, make or permit to exist any loans or advances to, or Guarantee any
Indebtedness of, or make or permit to exist any investment or any other
interest in, any other Person, except that, so long as no Default or Event of
Default shall have occurred and be continuing or will result therefrom, the
Borrower and its Subsidiaries may make:

          (a) Permitted Investments;

          (b) investments by the Borrower in the Equity Interests of its
Subsidiaries and investments by any Subsidiary in the Borrower or any other
Subsidiary;

          (c) loans or advances made by the Borrower to any Subsidiary and made by
any Subsidiary to the Borrower or any other Subsidiary;

          (d) Guarantees constituting Indebtedness permitted by Section 6.01;

          (e) investments consisting of non-cash consideration with respect to any
sale of assets by the Borrower or any Subsidiary;

          (f) Swap Agreements to the extent permitted under Section 6.05;

          (g) any purchases or other acquisitions of all or substantially all of the
Equity Interests in any Person permitted by Section 6.19; provided that,
immediately upon consummation thereof, such Person will be a Guarantor
(including, without limitation, as a result of a merger or consolidation
otherwise permitted under this Agreement) and any other purchase or acquisition
of any property or assets of any Person permitted by Section 6.19;

          (h) investments consisting of extensions of credit, including without
limitation, in the nature of accounts receivable arising from the grant of
trade credit or prepayments or similar transactions entered into in the
ordinary course of business and investments by the Borrower or any Subsidiary
in satisfaction or partial satisfaction thereof from financially troubled
account debtors to prevent or limit financial loss;

46

 

          (i) to the extent not prohibited by Law, loans and advances to the
officers, directors and employees of the Borrower and its Subsidiaries made
from time to time in the ordinary course of business; provided that the
aggregate amount of investments permitted by this clause (l) shall not exceed
$500,000 at anytime outstanding; and

          (j) investments not otherwise permitted by this Section 6.04 in an
aggregate amount not to exceed $10,000,000 at anytime outstanding.

          SECTION 6.05. Swap Agreements. The Borrower will not, and will not permit any of its Subsidiaries to, enter
into any Swap Agreement, except (a) Swap Agreements entered into to hedge or
mitigate risks to which the Borrower or any Subsidiary has actual exposure
(other than those in respect of Equity Interests of the Borrower or any of its
Subsidiaries), and (b) Swap Agreements entered into in order to effectively
cap, collar or exchange interest rates (from fixed to floating rates, from one
floating rate to another floating rate, from floating to fixed rates or
otherwise) with respect to any interest-bearing liability or investment of the
Borrower or any Subsidiary.

          SECTION 6.06. Restricted Payments. The Borrower will not, and will not permit any of its Subsidiaries to,
declare or make, or agree to pay or make, directly or indirectly, any
Restricted Payments, except that so long as no Default or Event of Default
shall have occurred and be continuing and provided that no Default or Event of
Default would result from the making of such Restricted Payment:

     (i) any Subsidiary may make Restricted Payments to the
Borrower or any Subsidiary; and

     (ii) the Borrower may declare, make or incur a liability to
make distributions to the Parent to fund Quarterly Distributions;
provided that (A) such Quarterly Distributions are made in
accordance with the provisions of the Partnership Agreement, and
(ii) the aggregate amount of Quarterly Distributions made by the
Parent with respect to any fiscal quarter shall not exceed
Available Cash for such fiscal quarter.

          SECTION 6.07. Transactions with Affiliates. Except as otherwise permitted hereunder, the Borrower will not,
and will not permit any of its Subsidiaries to, sell, lease or otherwise
transfer any property or assets to, or purchase, lease or otherwise acquire any
property or assets from, or otherwise engage in any other transactions with,
any of its Affiliates, except (a) as permitted by the Partnership Agreement, and
(b) transactions between or among the Borrower and its Subsidiaries not
involving any other Affiliate.

          SECTION 6.08. Sales of Assets. Neither the Borrower nor any Subsidiary shall enter into any arrangement,
direct or indirect, with any Person other than a Loan Party pursuant to which
the Borrower or any Subsidiary shall sell or otherwise transfer or dispose of
any property, real, personal or mixed, whether now owned or hereafter acquired,
except (i) sales, transfers or dispositions in the ordinary course of business
and the granting of any option or other right to purchase or otherwise acquire
property in the ordinary course of business, (ii) sales, transfers or
dispositions not in the ordinary course of business provided that the aggregate
proceeds of all such sales, transfers and dispositions permitted by this item
(ii) shall not exceed, (A) from the date hereof during any period of twelve
(12) consecutive months more than $25,000,000 and (B) during the term hereof
more than $50,000,000, (iii) sales of wetlands credits; (iv) sales, transfers
or dispositions of property that are no longer commercially viable to maintain
or obsolete, surplus or worn-out property, whether now owned or hereafter
acquired; (v) sales, transfers or dispositions of equipment or real property to
the extent that (A) such equipment or real property is exchanged for credit
against the purchase price of similar replacement equipment or real

47

 

property,
or (B) the proceeds of such sales, transfers or dispositions are reasonably
promptly, but in any event within 90 days, applied to the purchase price of
such replacement equipment or real property; (vi) the sale, transfer or
disposition of certain timber properties more specifically described on
Schedule 6.08; (vii) dispositions resulting from the bona fide exercise by a
Governmental Authority of its actual power of eminent domain or other
dispositions otherwise required by applicable law, and (viii) dispositions of
property subject to a Permitted Encumbrance that are transferred to a
lienholder or its designee in satisfaction or settlement of the lienholder’s
claim or a realization upon a security interest permitted under this
Agreement..

          SECTION 6.09. Constituent Documents. The Borrower will not, and will not permit any Subsidiary to, amend its
charter or by-laws or other constituent documents in any manner that would
materially and adversely affect the rights of the Lenders under this Agreement
or their ability to enforce the same.

          SECTION 6.10. Regulation T, U and X Compliance. The Borrower shall not and shall not permit any Subsidiary to
use the proceeds of the Loans to purchase or carry Margin Stock (as defined in
Regulation U, or otherwise act so as to cause any Lender, in extending credit
hereunder, to be in contravention of Regulations T, U or X.

          SECTION 6.11. Sales and Leasebacks. Except to the extent such leases in the aggregate would not require
total payments of more than $10,000,000 per annum, the Borrower shall not, and
shall not permit any of its Subsidiaries to, directly or indirectly, become or
remain liable as lessee or as a guarantor or other surety with respect to any
lease of any property (whether real, personal or mixed), whether now owned or
hereafter acquired that (i) the Borrower or any of its Subsidiaries has sold or
transferred or is to sell or transfer to any other Person (other than the
Borrower or any of its Subsidiaries) or (ii) the Borrower or any of its
Subsidiaries intends to use for substantially the same purpose as any other
property that has been or is to be sold or transferred by the Borrower or any
of its Subsidiaries to any Person (other than the Borrower or any of its
Subsidiaries) in connection with such lease.

          SECTION 6.12. Changes in Fiscal Year. The Borrower shall not change the end of its fiscal year to a date
other than December 31.

          SECTION 6.13. Change in the Nature of Business. The Borrower shall not engage directly or indirectly in any
business activity that would cause less than 90% of the gross income of the
Borrower to constitute “qualifying income” within the meaning of Section
7704(d) of the Code.

          SECTION 6.14. Limitation on Restrictions on Subsidiary
Distributions. The Borrower shall not, and shall not permit any of its Subsidiaries to enter into or suffer to

exist or become effective any consensual encumbrance or restriction on the
ability of any Subsidiary to make Restricted Payments in respect of any Equity
Interests of such Subsidiary held by, or pay any Indebtedness owed to, the
Borrower or any other Subsidiary; provided that (i) the foregoing shall not
apply to restrictions and conditions imposed by applicable Law or by this
Agreement, (ii) the foregoing shall not apply to restrictions and conditions
existing on the date hereof (but shall apply to any extension or renewal of, or
any amendment or modification expanding the scope of, any such restriction or
condition) to the extent such restrictions are listed on Schedule 6.14 attached
hereto, (iii) the foregoing shall not apply to customary restrictions and
conditions contained in agreements relating to the sale of a Subsidiary pending
such sale, provided such restrictions and conditions apply only to the
Subsidiary that is to be sold and such sale is permitted hereunder, and (iv)
the foregoing shall not apply to restrictions and conditions contained in the
documentation evidencing any Indebtedness permitted hereunder; provided that in
no event shall such restrictions and conditions contained in such documentation
evidencing such permitted

48

 

Indebtedness be more restrictive than the
restrictions and conditions set forth in Section 6.06 of this Agreement and
this Section 6.14.

          SECTION 6.15. Changes to the Omnibus Agreement. Without the prior written consent of the Administrative Agent,
which consent shall not be unreasonably withheld or delayed, neither the
Borrower nor any of its Subsidiaries shall (i) make any material change to the
terms of the Omnibus Agreement, (ii) release any party from its obligations
under the Omnibus Agreement or (iii) fail to diligently enforce the Omnibus
Agreement and avail itself of the rights and indemnities available thereunder,
except in each case, where such change, release or failure could not reasonably
be expected to have a Material Adverse Effect.

          SECTION 6.16. Changes to the Note Purchase Agreement. The Borrower will not agree to, and will not permit
any amendment to the Note Purchase Agreement which would (i) increase the
principal amount of the Notes issued thereunder, (ii) make the covenants in
Section 10 of the Note Purchase Agreement more restrictive on the Borrower than
the corresponding financial covenants in Section 6.17 and Section 6.18 hereof,
or (iii) make the events of default in Section 11 of the Note Purchase
Agreement more restrictive on the Borrower than the Events of Default
hereunder, in each case, without the consent of the Required Lenders; provided,
however, that in no event shall the covenants set forth in Section 10 of the
Note Purchase Agreement and the events of default set forth in the Note
Purchase Agreement as in effect on the date hereof be deemed to be more
restrictive than the corresponding covenants set forth in Section 6.17 and
Section 6.18 and the Events of Default hereunder. The Borrower will not make
any voluntary prepayments of principal or interest on the notes outstanding
under the Note Purchase Agreement.

          SECTION 6.17. Minimum Interest Coverage Ratio. The Borrower shall not permit the Interest Coverage Ratio as of
the last day of any fiscal quarter to be less than 4.0 to 1.0.

          SECTION 6.18. Maximum Leverage Ratio. The Borrower shall not permit the Leverage Ratio as of the last day of
any fiscal quarter to exceed 3.75 to 1.0; provided, however, that, if during
any one of the four fiscal quarters with respect to which the Leverage Ratio is
being determined, the Borrower or any Subsidiary has purchased or otherwise
acquired the Equity Interests of any Person in a transaction otherwise
permitted by the terms of this Agreement (an “Acquisition”), then the Leverage
Ratio shall not exceed 4.0 to 1.0 with respect to (i) the fiscal quarter in
which the Acquisition occurred and (ii)(A) if such Acquisition occurs during
the first half of such fiscal quarter, the two fiscal quarters immediately
following the fiscal quarter in which such Acquisition occurred, or (B) if such
Acquisition occurs during the second half of such fiscal quarter, the three
fiscal quarters immediately following the fiscal quarter in which such
Acquisition occurred.

          SECTION 6.19. Permitted Acquisitions. The Borrower shall not, except as otherwise permitted or required in
this Agreement, purchase or otherwise acquire, or permit any Subsidiary to
purchase or acquire, any Equity Interests in, any obligations or stock of, or
any other interest in, or all or substantially all of the assets of, any Person
whatsoever unless (i) permitted by Section 6.03 above, or (ii) (a) immediately
prior to and after giving effect to any such purchase or acquisition, no
Default or Event of Default shall have occurred or be continuing or will result
therefrom, (b) such purchase or acquisition is consummated in accordance with
applicable Law, and (c) immediately after giving effect to such purchase or
acquisition of a company or business pursuant to this Section 6.19, the
Borrower shall be in pro forma compliance with the covenants set forth in
Section 6.17 and Section 6.18 above, as evidenced by a certificate of the chief
financial officer of the Borrower delivered to the Administrative Agent on the
earlier of (i) the date that Borrower submits a Borrowing Request if Borrower
is making a Borrowing in connection therewith, or (ii) the date that Borrower
consummates the transaction requiring the delivery of such certificate.

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ARTICLE VII

Events of Default

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

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

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

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

          (d) any Loan Party shall fail to observe or perform any covenant,
condition or agreement contained in Section 5.02, 5.03 (with respect to
existence) or 5.08 or in Article VI;

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

          (f) any Loan Party shall fail to make any payment (whether of principal or
interest and regardless of amount) in respect of any Material Indebtedness,
when and as the same shall become due and payable or within any applicable
grace period;

          (g) any event or condition occurs that results in any Material
Indebtedness becoming due prior to its scheduled maturity or that enables or
permits (with or without the giving of notice, the lapse of time or both) the
holder or holders of any Material Indebtedness or any trustee or agent on its
or their behalf to cause any Material Indebtedness to become due, or to require
the prepayment, repurchase, redemption or defeasance thereof, prior to its
scheduled maturity; provided that this clause (g) shall not apply to secured
Indebtedness that becomes due as a result of the voluntary sale or transfer of
the property or assets securing such Indebtedness;

          (h) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed seeking (i) liquidation, reorganization or other relief
in respect of any Loan Party or its debts, or of a substantial part of its
assets, under any Federal, state or foreign bankruptcy, insolvency,
receivership or similar law now or hereafter in effect or (ii) the appointment
of a receiver, trustee, custodian, sequestrator, conservator or similar
official for any Loan Party or for a substantial part of its assets, and, in
any such case, such proceeding or petition shall continue undismissed for 60
days or an order or decree approving or ordering any of the foregoing shall be
entered;

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

          (j) any Loan Party shall become unable, admit in writing its inability or
fail generally to pay its debts as they become due;

          (k) one or more final non-appealable judgments for the payment of money in
an aggregate amount in excess of $10,000,000 (net of insurance coverage which
is reasonably expected to be paid by the insurer thereunder as confirmed by
such insurer) shall be rendered against any Loan Party or any combination
thereof and the same shall remain undischarged for a period of 60 consecutive
days during which execution shall not be effectively stayed, or any action
shall be legally taken by a judgment creditor to attach or levy upon any assets of any Loan Party to enforce
any such judgment and is not released, vacated or fully bonded within 60 days
after its attachment or levy;

          (l) an ERISA Event shall have occurred that, when taken together with all
other ERISA Events that have occurred, could reasonably be expected to result
in liability of the Parent, the Borrower and its Subsidiaries in an aggregate
amount that could reasonably be expected to have a Material Adverse Effect;

          (m) a Change in Control shall occur;

          (n) this Agreement or any other Loan Document ceases to be valid and
binding on any Loan Party in any material respect or is declared null and void
in any material respect, or the validity or enforceability thereof is contested
by any Loan Party or any Loan Party denies it has any or further liability
under this Agreement or under the other Loan Documents to which it is a party;

          (o) prior to the occurrence of a Parent Event, the Parent fails to keep in
full force and effect its legal existence and the rights, licenses, permits,
privileges and franchises material to the conduct of its business except where
the failure to do so in each case could not reasonably be expected to have a
Material Adverse Effect; or

          (p) prior to the occurrence of a Parent Event, any of the following events
occur and continue unremedied for a period of thirty (30) days after notice
thereof from the Administrative Agent to the Borrower (which notice will be
given at the request of any Lender) (i) the Parent fails to pay its obligations
before the same shall become delinquent or in default, including Tax
liabilities, that, if not paid, could result in a Material Adverse Effect,
except where (A) the validity or amount thereof is being contested in good
faith by appropriate proceedings, (B) the Parent has set aside on its books
adequate reserves with respect thereto in accordance with GAAP, and (C) the
failure to make payment pending such contest could not reasonably be expected
to result in a Material Adverse Effect; (ii) the Parent fails to permit any
representatives designated by the Administrative Agent or any Lender, upon
reasonable prior notice and subject to applicable safety rules and regulations,
to visit and inspect its properties, to examine and make extracts from its
books and records, and to discuss its affairs, finances and condition with its
officers and independent accountants, all at such reasonable times and as often
as reasonably requested; (iii) the Parent fails to comply with all laws, rules,
regulations and orders of any Governmental

51

 

Authority applicable to it or its
property, except where the failure to do so, individually or in the aggregate,
could not reasonably be expected to result in a Material Adverse Effect; or
(iv) (A) the Parent fails to comply in all material respects with all
applicable provisions of ERISA and the regulations and published
interpretations thereunder with respect to all employee benefit plans (as
defined in ERISA), (B) the Parent takes any action, or fails to take action,
the result of which could be a liability to the PBGC or a past due liability to
any Multiemployer Plan, (C) the Parent participates in any prohibited
transaction that could result in any civil penalty under ERISA or any tax under
the Code, or (D) the Parent does not operate each employee benefit plan in such
a manner that will not incur any tax liability under Section 4980B of the Code
or any liability to any qualified beneficiary as defined in Section 4980B of
the Code except to the extent, in each case, where the failure to do so would
not reasonably be expected to result in a Material Adverse Effect;

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

ARTICLE VIII

The Administrative Agent

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

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

          The Administrative Agent shall not have any duties or obligations except
those expressly set forth herein. Without limiting the generality of the
foregoing, (a) the Administrative Agent shall not be subject to any fiduciary
or other implied duties, regardless of whether a Default has occurred and is
continuing, (b) the Administrative Agent shall not have any duty to take any
discretionary action or exercise any discretionary powers, except discretionary
rights and powers expressly contemplated hereby that the Administrative Agent
is required to exercise in writing as directed by the Required Lenders (or such
other number or percentage of the Lenders as shall be necessary under the
circumstances as provided in Section 9.02), and (c) except as expressly set
forth herein, the Administrative Agent shall not have any

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duty to disclose, and
shall not be liable for the failure to disclose, any information relating to
the Borrower or any of its Subsidiaries that is communicated to or obtained by
the bank serving as Administrative Agent or any of its Affiliates in any
capacity. The Administrative Agent shall not be liable for any action taken or
not taken by it with the consent or at the request of the Required Lenders (or
such other number or percentage of the Lenders as shall be necessary under the
circumstances as provided in Section 9.02) or in the absence of its own gross
negligence or willful misconduct. The Administrative Agent shall be deemed not
to have knowledge of any Default unless and until written notice thereof is
given to the Administrative Agent by the Borrower or a Lender, and the
Administrative Agent shall not be responsible for or have any duty to ascertain
or inquire into (i) any statement, warranty or representation made in or in
connection with this Agreement, (ii) the contents of any certificate, report or
other document delivered hereunder or in connection herewith, (iii) the
performance or observance of any of the covenants, agreements or other terms or
conditions set forth herein, (iv) the validity, enforceability, effectiveness
or genuineness of this Agreement or any other agreement, instrument or
document, or (v) the satisfaction of any condition set forth in Article IV or
elsewhere herein, other than to confirm receipt of items expressly required to
be delivered to the Administrative Agent.

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

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

          Subject to the appointment and acceptance of a successor Administrative
Agent as provided in this paragraph, the Administrative Agent may resign at any
time by notifying the Lenders, the Issuing Bank and the Borrower. Upon any
such resignation, the Required Lenders shall have the right, with the consent
of the Borrower (which consent shall not be unreasonably withheld, conditioned
or delayed), to appoint a successor. If no successor shall have been so
appointed by the Required Lenders and shall have accepted such appointment
within 30 days after the retiring Administrative Agent gives notice of its
resignation, then the retiring Administrative Agent may, on behalf of the
Lenders and the Issuing Bank, appoint a successor Administrative Agent which
shall be a bank with an office in New York, New York, or an Affiliate of any
such bank. Upon the acceptance of its appointment as Administrative Agent
hereunder by a successor, such successor shall succeed to and become vested
with all the rights, powers, privileges and duties of the retiring
Administrative Agent, and the retiring Administrative Agent shall be discharged
from its duties and obligations hereunder. The fees payable by the Borrower to
a successor Administrative Agent shall be the same as those payable to its
predecessor unless otherwise agreed between the Borrower and such successor.
After the Administrative Agent’s resignation hereunder, the provisions of this
Article and Section 9.03 shall continue in effect for the benefit of such
retiring Administrative Agent, its sub-agents and their respective Related
Parties in respect of any actions taken or omitted to be taken by any of them
while it was acting as Administrative Agent.

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

ARTICLE IX

Miscellaneous

          SECTION 9.01. Notices. (a) Except in the case of notices and other communications expressly permitted to
be given by telephone (and subject to paragraph (b) below), all notices and
other communications provided for herein shall be in writing and shall be
delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopy (or sent by email as set
forth in Section 9.01(c) below), as follows:

     (i) if to the Borrower, to it at 601 Jefferson, Suite 3600,
Houston, Texas 77002, Attention of Dwight L. Dunlap (Telecopy No.
(713) 751-7515; Email address: ddunlap@quintanaminerals.com);

     (ii) if to the Administrative Agent, to it at 2 Penns Way, 1st
Floor, New Castle, Delaware 19720, Attention of Tara A. Wooster
(Telecopy No. (212) 994-0961); and

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

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

          (c) The Borrower hereby agrees that it will provide to the Administrative
Agent all information, documents and other materials that it is obligated to
furnish to the Administrative Agent pursuant to the Loan Documents, including,
without limitation, all notices, requests, financial statements, financial and
other reports, certificates and other information materials, but excluding any
such communication that (i) relates to a request for a new, or a conversion of
an existing, borrowing or other extension of credit (including any election of
an interest rate or interest period relating thereto), (ii) relates to the
payment of any principal or other amount due under the Credit Agreement prior
to the scheduled date therefor, (iii) provides notice of any default or event
of default under the Credit Agreement, or (iv) is required to be delivered to
satisfy any condition precedent to the effectiveness of the Credit Agreement
and/or any borrowing or other extension of credit thereunder (all such
non-excluded communications being referred to herein collectively as
“Communications”), by transmitting the Communications in an electronic/soft
medium in a format acceptable to the Administrative Agent to
“oploanswebadmin@citigroup.com”. In addition, the Borrower agrees to continue
to provide the

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Communications to the Agent in the manner specified in the Loan
Documents but only to the extent requested by the Administrative Agent.

          The Borrower further agrees that the Administrative Agent may make the
Communications available to the Lenders by posting the Communications on
Intralinks or a substantially similar electronic transmission systems (the
“Platform”). The Borrower acknowledges that the distribution of material
through an electronic medium is not necessarily secure and that there are
confidentiality and other risks associated with such distribution.

          The Platform is provided “as is” and “as available”. The Agent Parties
(as defined below) do not warrant the accuracy or completeness of the
Communications, or the adequacy of the Platform and expressly disclaim
liability for errors or omissions in the Communications. No warranty of any
kind, express, implied or statutory, including, without limitation, any
warranty of merchantability, fitness for a particular purpose, non-infringement
of third party rights or freedom from viruses or other code defects, is made by
the agent parties in connection with the Communications or the Platform. In no
event shall the Administrative Agent or any of its affiliates or any of their
respective officers, directors, employees, agents, advisors or representatives (collectively, “Agent
Parties”) have any liability to the Borrower, any Lender or any other person or
entity for damages of any kind, including, without limitation, direct or
indirect, special, incidental or consequential damages, losses or expenses
(whether in tort, contract or otherwise) arising out of the Borrower’s or the
Administrative Agent’s transmission of Communications through the internet,
except to the extent the liability of any agent party is found in a final
non-appealable judgment by a court of competent jurisdiction to have resulted
primarily from such Agent Party’s gross negligence or willful misconduct.

          The Administrative Agent agrees that the receipt of the Communications by
the Agent at its e-mail address set forth above shall constitute effective
delivery of the Communications to the Agent for purposes of the Loan Documents.
Each Lender agrees that notice to it (as provided in the next sentence)
specifying that the Communications have been posted to the Platform shall
constitute effective delivery of the Communications to such Lender for purposes
of the Loan Documents. Each Lender agrees to notify the Administrative Agent
in writing (including by electronic communication) from time to time of such
Lender’s e-mail address to which the foregoing notice may be sent by electronic
transmission, and (ii) that the foregoing notice may be sent to such e-mail
address. Nothing herein shall prejudice the right of the Administrative Agent
or any Lender to give any notice or other communication pursuant to any Credit
Document in any other manner specified in such Credit Document.

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

          SECTION 9.02. Waivers; Amendments. (a) No failure or delay by the Administrative Agent, the Issuing Bank
or any Lender in exercising any right or power hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any such right or
power, or any abandonment or discontinuance of steps to enforce such a right or
power, preclude any other or further exercise thereof or the exercise of any
other right or power. The rights and remedies of the Administrative Agent, the
Issuing Bank and the Lenders hereunder are cumulative and are not exclusive of
any rights or remedies that they would otherwise have. No waiver of any
provision of this Agreement or consent to any departure by the Borrower
therefrom shall in any event be effective unless the same shall be permitted by
paragraph (b) of this Section, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which given.
Without limiting the generality of the foregoing, the making of a Loan or
issuance of a Letter of Credit shall not be construed as a waiver of any
Default, regardless of whether the

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Administrative Agent, any Lender or the
Issuing Bank may have had notice or knowledge of such Default at the time.

          (b) Neither this Agreement nor any provision hereof may be waived, amended
or modified except pursuant to an agreement or agreements in writing entered
into by the Borrower and the Required Lenders or by the Borrower and the
Administrative Agent with the consent of the Required Lenders; provided that no
such agreement shall (i) increase the Commitment of any Lender without the
written consent of such Lender, (ii) reduce the principal amount of any Loan or
LC Disbursement or reduce the rate of interest thereon, or reduce any fees
payable hereunder, without the written consent of each Lender affected thereby,
(iii) postpone the scheduled date of payment of the principal amount of any
Loan or LC Disbursement, or any interest thereon, or any fees payable
hereunder, or reduce the amount of, waive or excuse any such payment, or
postpone the scheduled date of expiration of any Commitment, without the
written consent of each Lender affected thereby, (iv) change Section 2.18(b) or
(c) in a manner that would alter the pro rata sharing of payments required
thereby, without the written consent of each Lender, (v) release any Guarantor,
or (vi) change any of the provisions of this Section or the definition of “Required Lenders” or any other provision hereof specifying
the number or percentage of Lenders required to waive, amend or modify any
rights hereunder or make any determination or grant any consent hereunder,
without the written consent of each Lender; provided further that no such
agreement shall amend, modify or otherwise affect the rights or duties of the
Administrative Agent or the Issuing Bank hereunder without the prior written
consent of the Administrative Agent or the Issuing Bank, as the case may be.

          SECTION 9.03. Expenses; Indemnity; Damage Waiver. (a) The Borrower shall pay (i) all reasonable
out-of-pocket expenses incurred by the Administrative Agent and its Affiliates,
including the reasonable fees, charges and disbursements of one counsel for the
Administrative Agent, in connection with the syndication of the credit
facilities provided for herein, the preparation and administration of this
Agreement or any amendments, modifications or waivers of the provisions hereof
(whether or not the Transactions contemplated hereby or thereby shall be
consummated), (ii) all reasonable out-of-pocket expenses incurred by the
Issuing Bank in connection with the issuance, amendment, renewal or extension
of any Letter of Credit or any demand for payment thereunder and (iii) all
reasonable out-of-pocket expenses incurred by the Administrative Agent, the
Issuing Bank or any Lender, including the fees, charges and disbursements of
any counsel for the Administrative Agent, the Issuing Bank or any Lender, in
connection with the enforcement or protection of its rights in connection with
this Agreement, including its rights under this Section, or 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) The Borrower shall indemnify the Administrative Agent, the Joint Lead
Arrangers and Joint Bookrunners, the Issuing Bank and each Lender, and each
Related Party of any of the foregoing Persons (each such Person being called an
“Indemnitee”) against, and hold each Indemnitee harmless from, any and all
losses, claims, damages, liabilities and related expenses, including the fees,
charges and disbursements of any counsel for any Indemnitee, incurred by or
asserted against any Indemnitee arising out of, in connection with, or as a
result of (i) the execution or delivery of this Agreement or any agreement or
instrument contemplated hereby, the performance by the parties hereto of their
respective obligations hereunder or the consummation of the Transactions or any
other transactions contemplated hereby, (ii) any Loan or Letter of Credit or
the use of the proceeds therefrom (including any refusal by the Issuing Bank to
honor a demand for payment under a Letter of Credit if the documents presented
in connection with such demand do not strictly comply with the terms of such
Letter of Credit), (iii) any actual or alleged presence or release of Hazardous
Materials on or from any property owned or operated by the Borrower or any of
its Subsidiaries, or any Environmental Liability related in any way to the
Borrower or any of its Subsidiaries, or (iv) any actual or prospective claim,
litigation, investigation or

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proceeding relating to any of the foregoing,
whether based on contract, tort or any other theory and regardless of whether
any Indemnitee is a party thereto; provided that such indemnity shall not, as
to any Indemnitee, be available to the extent that such losses, claims,
damages, liabilities or related expenses are determined by a court of competent
jurisdiction by final and non-appealable judgment to have resulted from the
gross negligence or willful misconduct of such Indemnitee.

          (c) To the extent that the Borrower fails to pay any amount required to be
paid by it to the Administrative Agent or the Issuing Bank under paragraph (a)
or (b) of this Section, each Lender severally agrees to pay to the
Administrative Agent or the Issuing Bank, as the case may be, such Lender’s
Applicable Percentage (determined as of the time that the applicable
un-reimbursed expense or indemnity payment is sought) of such unpaid amount;
provided that the un-reimbursed 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 the Issuing Bank in its capacity as such.

          (d) Each Loan Party shall defend and indemnify the Administrative Agent
and each Lender and hold them harmless from and against all loss, liability,
damage, expense, claims, costs, fines, penalties, assessments (including
interest on any of the foregoing) and reasonable attorneys’ fees, suffered or
incurred by the Administrative Agent or any Lender which arise, result from or
in any way relate to a breach or violation by any Loan Party of any applicable
Environmental Laws, either prior to or subsequent to the date hereof, including
the assertion or imposition of any Lien on any Loan Party’s assets, or which
relate to or arise out of any Environmental Liability. Each Loan Party’s
obligations hereunder shall survive the termination of this Agreement and the
repayment of the Loans.

          (e) To the extent permitted by applicable law, the Borrower shall not
assert, and hereby waives, any claim against any Indemnitee, on any theory of
liability, for special, indirect, consequential or punitive damages (as opposed
to direct or actual damages) arising out of, in connection with, or as a result
of, this Agreement or any agreement or instrument contemplated hereby, the
Transactions, any Loan or Letter of Credit or the use of the proceeds thereof.

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

          SECTION 9.04. Successors and Assigns. (a) The provisions of this Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective successors and
assigns permitted hereby (including any Affiliate of the Issuing Bank that
issues any Letter of Credit), except that (i) the Borrower may not assign or
otherwise transfer any of its rights or obligations hereunder without the prior
written consent of each Lender (and any attempted assignment or transfer by the
Borrower without such consent shall be null and void) and (ii) no Lender may
assign or otherwise transfer its rights or obligations hereunder except in
accordance with this Section. Nothing in this Agreement, expressed or implied,
shall be construed to confer upon any Person (other than the parties hereto,
their respective successors and assigns permitted hereby (including any
Affiliate of the Issuing Bank that issues any Letter of Credit), Participants
(to the extent provided in paragraph (c) of this Section) and, to the extent
expressly contemplated hereby, the Related Parties of each of the
Administrative Agent, the Issuing Bank and the Lenders) any legal or equitable
right, remedy or claim under or by reason of this Agreement.

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

57

 

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

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

          (C) the Issuing Bank.

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

          (A) except in the case of an assignment to a Lender or an
Affiliate of a Lender or an assignment of the entire remaining
amount of the assigning Lender’s Commitment or Loans of any Class,
the amount of the Commitment or Loans of the assigning Lender
subject to each such assignment (determined as of the date the
Assignment and Assumption with respect to such assignment is
delivered to the Administrative Agent) shall not be less than
$5,000,000 unless each of the Borrower and the Administrative Agent
otherwise consent, provided that no such consent of the Borrower
shall be required if an Event of Default has occurred and is
continuing;

          (B) each partial assignment shall be made as an assignment of
a proportionate part of all the assigning Lender’s rights and
obligations under this Agreement, provided that this clause shall
not be construed to prohibit the assignment of a proportionate part
of all the assigning Lender’s rights and obligations in respect of
one Class of Commitments or Loans;

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

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

          For the purposes of this Section 9.04(b), the term “Approved Fund” has the
following meaning:

          “Approved Fund” means any Person (other than a natural person) that is
engaged in making, purchasing, holding or investing in bank loans and similar
extensions of credit in the ordinary course of its business and that is
administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an
entity or an Affiliate of an entity that administers or manages a Lender.

     (iii) Subject to acceptance and recording thereof pursuant to
paragraph (b)(iv) of this Section, from and after the effective
date specified in each Assignment and Assumption the assignee
thereunder shall be a party hereto and, to the extent of the
interest assigned by such Assignment and Assumption, have the
rights and obligations of a Lender under this Agreement, and the
assigning Lender thereunder shall, to the extent of the interest
assigned by such Assignment and Assumption, be released from its
obligations under this Agreement (and, in the case of an Assignment
and Assumption covering all of the assigning Lender’s rights and
obligations under this Agreement, such Lender shall cease to be a
party hereto but shall continue to be entitled to the benefits of

58

 

Sections 2.15, 2.16, 2.17 and 9.03). Any assignment or transfer by
a Lender of rights or obligations under this Agreement that does
not comply with this Section 9.04 shall be treated for purposes of
this Agreement as a sale by such Lender of a participation in such
rights and obligations in accordance with paragraph (c) of this
Section.

     (iv) The Administrative Agent, acting for this purpose as an
agent of the Borrower, shall maintain at one of its offices a copy
of each Assignment and Assumption delivered to it and a register
for the recordation of the names and addresses of the Lenders, and
the Commitment of, and principal amount of the Loans and LC
Disbursements owing to, each Lender pursuant to the terms hereof
from time to time (the “Register”). The entries in the Register
shall be conclusive, and the Borrower, the Administrative Agent,
the Issuing Bank and the Lenders may treat each Person whose
name is recorded in the Register pursuant to the terms hereof
as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. The Register shall be
available for inspection by the Borrower, the Issuing Bank and any
Lender, at any reasonable time and from time to time upon
reasonable prior notice.

     (v) Upon its receipt of a duly completed Assignment and
Assumption executed by an assigning Lender and an assignee, the
assignee’s completed Administrative Questionnaire (unless the
assignee shall already be a Lender hereunder), the processing and
recordation fee referred to in paragraph (b) of this Section and
any written consent to such assignment required by paragraph (b) of
this Section, the Administrative Agent shall accept such Assignment
and Assumption and record the information contained therein in the
Register; provided that if either the assigning Lender or the
assignee shall have failed to make any payment required to be made
by it pursuant to Section 2.06(d), Section 2.06(e), Section
2.07(b), Section 2.18(d) or Section 9.03(c), the Administrative
Agent shall have no obligation to accept such Assignment and
Assumption and record the information therein in the Register
unless and until such payment shall have been made in full,
together with all accrued interest thereon. No assignment shall be
effective for purposes of this Agreement unless it has been
recorded in the Register as provided in this paragraph.

          (c) (i) Any Lender may, without the consent of the Borrower, the
Administrative Agent or the Issuing Bank, sell participations to one or more
banks or other entities (a “Participant”) in all or a portion of such Lender’s
rights and obligations under this Agreement (including all or a portion of its
Commitment and the Loans owing to it); provided that (A) such Lender’s
obligations under this Agreement shall remain unchanged, (B) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations and (C) the Borrower, the Administrative Agent, the Issuing
Bank and the other Lenders shall continue to deal solely and directly with such
Lender in connection with such Lender’s rights and obligations under this
Agreement. Any agreement or instrument pursuant to which a Lender sells such a
participation shall provide that such Lender shall retain the sole right to
enforce this Agreement and to approve any amendment, modification or waiver of
any provision of this Agreement; provided that such agreement or instrument may
provide that such Lender will not, without the consent of the Participant,
agree to any amendment, modification or waiver described in the first proviso
to Section 9.02(b) that affects such Participant. Subject to paragraph (c)(ii)
of this Section, the Borrower agrees that each Participant shall be entitled to
the benefits of Section 2.15, Section 2.16 and Section 2.17 to the same extent
as if it were a Lender and had acquired its interest by assignment pursuant to
paragraph (b) of this Section. To the extent permitted by law, each
Participant also shall be entitled to the benefits of Section 9.08 as though it
were a Lender, provided such Participant agrees to be subject to Section
2.18(c) as though it were a Lender.

59

 

     (ii) A Participant shall not be entitled to receive any
greater payment under Section 2.15 or 2.17 than the applicable
Lender would have been entitled to receive with respect to the
participation sold to such Participant, unless the sale of the
participation to such Participant is made with the Borrower’s prior
written consent. A Participant that would be a Foreign Lender if
it were a Lender shall not be entitled to the benefits of Section
2.17 unless the Borrower is notified of the participation sold to
such Participant and such Participant agrees, for the benefit of
the Borrower, to comply with Section 2.17(e) as though it were a
Lender.

          (d) Any Lender may at any time pledge or assign a security interest in all
or any portion of its rights under this Agreement to secure obligations of such
Lender, including without limitation any pledge or assignment to secure
obligations to a Federal Reserve Bank, and this Section shall not apply to any such pledge or assignment of a security interest;
provided that no such pledge or assignment of a security interest shall release
a Lender from any of its obligations hereunder or substitute any such pledgee
or assignee for such Lender as a party hereto.

          SECTION 9.05. Survival. All covenants, agreements, representations and warranties made by the Borrower
herein and in the certificates or other instruments delivered in connection
with or pursuant to this Agreement shall be considered to have been relied upon
by the other parties hereto and shall survive the execution and delivery of
this Agreement and the making of any Loans and issuance of any Letters of
Credit, regardless of any investigation made by any such other party or on its
behalf and notwithstanding that the Administrative Agent, the Issuing Bank or
any Lender may have had notice or knowledge of any Default or incorrect
representation or warranty at the time any credit is extended hereunder, and
shall continue in full force and effect as long as the principal of or any
accrued interest on any Loan or any fee or any other amount payable under this
Agreement is outstanding and unpaid or any Letter of Credit is outstanding and
so long as the Commitments have not expired or terminated. The provisions of
Sections 2.15, 2.16, 2.17 and 9.03 and Article VIII shall survive and remain in
full force and effect regardless of the consummation of the Transactions
contemplated hereby, the repayment of the Loans, the expiration or termination
of the Letters of Credit and the Commitments or the termination of this
Agreement or any provision hereof.

          SECTION 9.06. Counterparts; Integration; Effectiveness. This Agreement may be executed in counterparts (and by
different parties hereto on different counterparts), each of which shall
constitute an original, but all of which when taken together shall constitute a
single contract. This Agreement and any separate letter agreements with
respect to fees payable to the Administrative Agent constitute the entire
contract among the parties relating to the subject matter hereof and supersede
any and all previous agreements and understandings, oral or written, relating
to the subject matter hereof. Except as provided in Section 4.01, this
Agreement shall become effective when it shall have been executed by the
Administrative Agent and when the Administrative Agent shall have received
counterparts hereof which, when taken together, bear the signatures of each of
the other parties hereto, and thereafter shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns.
Delivery of an executed counterpart of a signature page of this Agreement by
telecopy shall be effective as delivery of a manually executed counterpart of
this Agreement.

          SECTION 9.07. Severability. Any provision of this Agreement held to be invalid, illegal or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such invalidity, illegality or unenforceability without affecting the validity,
legality and enforceability of the remaining provisions hereof; and the
invalidity of a particular provision in a particular jurisdiction shall not
invalidate such provision in any other jurisdiction.

60

 

          SECTION 9.08. Right of Setoff. If an Event of Default shall have occurred and be continuing, each Lender and
each of its Affiliates is hereby authorized at any time and from time to time,
to the fullest extent permitted by law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held and other obligations at any time owing by such Lender or Affiliate to or
for the credit or the account of the Borrower against any of and all the
obligations of the Borrower now or hereafter existing under this Agreement held by such Lender, irrespective of whether or not
such Lender shall have made any demand under this Agreement and although such
obligations may be unmatured. The rights of each Lender under this Section are
in addition to other rights and remedies (including other rights of setoff)
which such Lender may have.

          SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of
Process. (a) This Agreement shall be construed in accordance with and governed by the law of the State of New York.

          (b) The Borrower hereby irrevocably and unconditionally submits, for
itself and its property, to the nonexclusive jurisdiction of the Supreme Court
of the State of New York sitting in New York County and of the United States
District Court of the Southern District of New York, and any appellate court
from any thereof, in any action or proceeding arising out of or relating to
this Agreement, or for recognition or enforcement of any judgment, and each of
the parties hereto hereby irrevocably and unconditionally agrees that all
claims in respect of any such action or proceeding may be heard and determined
in such New York State or, to the extent permitted by law, in such Federal
court. Each of the parties hereto agrees that a final judgment in any such
action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
Nothing in this Agreement shall affect any right that the Administrative Agent,
the Issuing Bank or any Lender may otherwise have to bring any action or
proceeding relating to this Agreement against the Borrower or its properties in
the courts of any jurisdiction.

          (c) The Borrower hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection which it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Agreement in any court referred to in
paragraph (b) of this Section. Each of the parties hereto hereby irrevocably
waives, to the fullest extent permitted by law, the defense of an inconvenient
forum to the maintenance of such action or proceeding in any such court.

          (d) Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 9.01. Nothing in this
Agreement will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.

          SECTION 9.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL
PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT
OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY
OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT
OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT
SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE
BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL
WAIVERS AND CERTIFICATIONS IN THIS SECTION.

61

 

          SECTION 9.11. Headings. Article and Section headings and the Table of Contents used herein are for convenience
of reference only, are not part of this Agreement and shall not affect the
construction of, or be taken into consideration in interpreting, this
Agreement.

          SECTION 9.12. Confidentiality. Each of the Administrative Agent, the Issuing Bank and the Lenders agrees to
maintain the confidentiality of the Information (as defined below), except that
Information may be disclosed (a) to its and its Affiliates’ directors,
officers, employees and agents, including accountants, legal counsel and other
advisors (it being understood that the Persons to whom such disclosure is made
will be informed of the confidential nature of such Information and instructed
to keep such Information confidential), (b) to the extent requested by any
regulatory authority, (c) to the extent required by applicable Laws or
regulations or by any subpoena or similar legal process, (d) to any other party
to this Agreement, (e) in connection with the exercise of any remedies
hereunder or any suit, action or proceeding relating to this Agreement or the
enforcement of rights hereunder, (f) subject to an agreement containing
provisions substantially the same as those of this Section, to (i) any assignee
of or Participant in, or any prospective assignee of or Participant in, any of
its rights or obligations under this Agreement or (ii) any actual or
prospective counterparty (or its advisors) to any swap or derivative
transaction relating to the Borrower and its obligations, (g) with the consent
of the Borrower or (h) to the extent such Information (i) becomes publicly
available other than as a result of a breach of this Section or (ii) becomes
available to the Administrative Agent, the Issuing Bank or any Lender on a
non-confidential basis from a source other than the Borrower. For the purposes
of this Section, “Information” means all information received from the Borrower
relating to the Borrower or its business, other than any such information that
is available to the Administrative Agent, the Issuing Bank or any Lender on a
non-confidential basis prior to disclosure by the Borrower; provided that, in
the case of information received from the Borrower after the date hereof, such
information is clearly identified at the time of delivery as confidential. Any
Person required to maintain the confidentiality of Information as provided in
this Section shall be considered to have complied with its obligation to do so
if such Person has exercised the same degree of care to maintain the
confidentiality of such Information as such Person would accord to its own
confidential information.

          SECTION 9.13. Interest Rate Limitation. Notwithstanding anything herein to the contrary, if at any time the
interest rate applicable to any Loan, together with all fees, charges and other
amounts which are treated as interest on such Loan under applicable law
(collectively the “Charges”), shall exceed the maximum lawful rate (the
“Maximum Rate”) which may be contracted for, charged, taken, received or
reserved by the Lender holding such Loan in accordance with applicable law, the
rate of interest payable in respect of such Loan hereunder, together with all
Charges payable in respect thereof, shall be limited to the Maximum Rate and,
to the extent lawful, the interest and Charges that would have been payable in
respect of such Loan but were not payable as a result of the operation of this
Section shall be cumulated and the interest and Charges payable to such Lender
in respect of other Loans or periods shall be increased (but not above the
Maximum Rate therefor) until such cumulated amount, together with interest
thereon at the Federal Funds Effective Rate to the date of repayment, shall
have been received by such Lender.

          SECTION 9.14. USA PATRIOT Act. Each Lender that is subject to the requirements of the USA Patriot Act (Title
III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Act”) hereby
notifies the Borrower that pursuant to the requirements of the Act, it is
required to obtain, verify and record information that identifies the
Borrower, which information includes the name and address of the Borrower
and other information that will allow such Lender to identify the Borrower in
accordance with the Act.

62

 

          SECTION 9.15. Separateness. The Lenders acknowledge that (i) the Lenders have advanced funds to the Borrower in
reliance upon the separateness of the Parent and the Borrower from each other
and from any other Persons, and (ii) the Borrower has assets and liabilities
that are separate from those of other Persons, including the Parent.

          SECTION 9.16. No Personal Liability of Directors, Officers, Employees and
Unitholders. No director, officer, partner, employee, member or manager of the General Partner will have any
liability for any obligations of the Borrower, or for any claim based on, in
respect of, or by reason of, such obligations or their creation. Each Lender
waives and releases all such liability. This waiver and release are part of the
consideration for the making of the Loans and the issuance of Letters of
Credit.

[END OF TEXT]

63

 

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

	 	 	 	 	 
	 	BORROWER:

NRP (OPERATING) LLC,
a Delaware limited liability company

 	 
	 	By:  	/s/ Dwight L. Dunlap
 	 
	 	 	Dwight L. Dunlap, 	 
	 	 	Chief Financial Officer 	 

	 	 	 	 	 
	 	CITIBANK, N.A.,
a national banking association

 	 
	 	By:  	/s/ Daniel J. Miller
 	 
	 	 	Name:  	 	 
	 	 	Title:  	Vice President 	 

	 	 	 	 	 
	 	WACHOVIA BANK, NATIONAL ASSOCIATION

 	 
	 	By:  	/s/ Jonathon R. Richardson
 	 
	 	 	Name:  	 	 
	 	 	Title:  	Vice President 	 

	 	 	 	 	 
	 	BANK OF MONTREAL

 	 
	 	By:  	John M. Cook
 	 
	 	 	Name:  	 	 
	 	 	Title:  	Director 	 

Schedule 6.14 - Page 1

 

	 	 	 	 	 
	 	BNP PARIBAS

 	 
	 	By:  	/s/ J. Onischuk
 	 
	 	 	Name:  	 	 
	 	 	Title:  	Director 	 

	 	 	 	 	 
	 	 	 
	 	By:  	                          /s/Greg Smothers
 	 
	 	 	Name:  	 	 
	 	 	Title:  	Vice President 	 

	 	 	 	 	 
	 	BRANCH BANKING AND TRUST COMPANY

 	 
	 	By:  	/s/ Timothy A. Paxton
 	 
	 	 	Name:  	 	 
	 	 	Title:  	Senior Vice President 	 

	 	 	 	 	 
	 	THE HUNTINGTON NATIONAL BANK

 	 
	 	By:  	/s/ L. Blair DeVan
 	 
	 	 	Name:  	 	 
	 	 	Title:  	Vice President 	 

2

 

	 	 	 	 	 
	 	COMERICA BANK

 	 
	 	By:  	/s/ Juli Bieser
 	 
	 	 	Name:  	 	 
	 	 	Title:  	Vice President 	 

	 	 	 	 	 
	 	COMPASS BANK

 	 
	 	By:  	/s/ Murray E. Brasseux
 	 
	 	 	Name:  	 	 
	 	 	Title:  	Executive Vice President 	 

	 	 	 	 	 
	 	ROYAL BANK OF CANADA

 	 
	 	By:  	/s/ Lorne Gartner
 	 
	 	 	Name:  	 	 
	 	 	Title:  	Authorized Signatory 	 

	 	 	 	 	 
	 	SOUTHWEST BANK OF TEXAS, N.A.

 	 
	 	By:  	/s/ W. Bryan Chapman
 	 
	 	 	Name:  	 	 
	 	 	Title:  	Senior Vice President, Energy Lending 	 

3exv10w2

 

EXHIBIT 10.2

Natural Resource Partners

Long-Term Incentive Plan

Phantom Unit Agreement

     AGREEMENT made as of    between GP Natural Resource Partners LLC,
a Delaware limited liability company (the “Company”), and
   (“Employee”).

     To carry out the purposes of the Natural Resource Partners Long-Term
Incentive Plan (the “Plan”), by affording Employee the opportunity to receive
cash payments based on the Fair Market Value of the Common Units (“Units”) of
Natural Resource Partners L.P. (the “Partnership”), the Company and Employee
hereby agree as follows:

	1.	 	Grant of Phantom Units.

	 	(a)	 	General. The Company hereby grants to Employee    Phantom
Units pursuant to the Plan. This grant is subject to the terms and
conditions of the Plan, which is incorporated herein by reference as
a part of this Agreement. A copy of the Plan is attached hereto.
In the event of any conflict between the terms of this Agreement and
the Plan, the Plan shall control. Capitalized terms used in this
Agreement but not defined herein shall have the meanings ascribed to
such terms in the Plan, unless the context requires otherwise.
	 
	 	(b)	 	Vesting. Except as otherwise provided in Paragraph 2 hereof,
all Phantom Units granted hereunder shall vest in accordance with
Schedule A hereto.

	2.	 	Events Occurring Prior to Vesting.

	 	(a)	 	Death or Disability. If, prior to vesting, Employee ceases
to be an employee of the Company and its Affiliates as a result of
death or disability (within the Company’s policy or determination
thereof), the Phantom Units then held by Employee will automatically
become fully vested upon such termination.
	 
	 	(b)	 	Other Terminations. Except as provided in Paragraph 2(c)
hereof, if Employee terminates from the Company and its Affiliates
for any reason other than death or disability as provided in (a)
above, all then unvested Phantom Units then held by Employee shall
be automatically forfeited upon such termination.
	 
	 	(c)	 	Change in Control. Notwithstanding any other provision
hereof, the Phantom Units shall become fully vested immediately
prior to the occurrence of a Change in Control.

	3.	 	Payment. As soon as administratively practicable after the vesting of a
Phantom Unit, Employee shall be entitled to receive from the Company a
cash payment based upon the Fair Market Value of the Unit on the payment
date.

1

 

	4.	 	Limitations Upon Transfer. All rights under this Agreement shall belong
to Employee and may not be transferred, assigned, pledged, or hypothecated
in any way (whether by operation of law or otherwise), other than by will
or the laws of descent and distribution or pursuant to a “qualified
domestic relations order” (as defined by the Internal Revenue Code of
1986, as amended), and shall not be subject to execution, attachment, or
similar process. Upon any attempt to transfer, assign, pledge,
hypothecate, or otherwise dispose of such rights contrary to the
provisions in this Agreement, or the Plan, or upon the levy of any
attachment or similar process upon such rights, such rights shall
immediately become null and void.
	 
	5.	 	Withholding of Tax. To the extent that the grant, vesting or payment of
a vested Phantom Unit results in the receipt of compensation by Employee
with respect to which the Company or Affiliate has a withholding
obligation, Employee shall deliver to the Company or Affiliate such amount
of money as the Company or Affiliate may require to meet its minimum
withholding obligations under applicable tax laws or regulations. No
payment of a vested Phantom Unit shall be made pursuant to this Agreement
until Employee has made arrangements approved by the Company or Affiliate
to satisfy all applicable minimum tax withholding requirements of the
Company or Affiliate.
	 
	6.	 	Binding Effect. This Agreement shall be binding upon and inure to the
benefit of any successor or successors of the Company or upon any person
lawfully claiming under Employee.
	 
	7.	 	Modification. Except to the extent permitted by the Plan, any
modification of this Agreement will be effective only if it is in writing
and signed by each party whose rights hereunder are affected thereby.
	 
	8.	 	Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware, without regard to
conflicts of laws principles thereof.

2

 

     IN WITNESS WHEREOF, the Company has caused this Agreement to be executed
by its duly authorized officer, and Employee has executed this Agreement, all
effective as of the day and year first above written.

	 	 	 	 	 
	 	GP NATURAL RESOURCE PARTNERS LLC

 	 
	 	By:  	 	 
	 	 	Name:  	Corbin J. Robertson, Jr. 	 
	 	 	Title:  	Chairman and Chief Executive Officer 	 
	 
	 	EMPLOYEE

 	 
	 	 	 
	 	 	 
	 	 	 
	 

3

 

Schedule A

	 
	Units Granted
	 	Vesting Date

4

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