Common use of Debt Clause in Contracts

Debt. Create, incur, assume or suffer to exist, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other than: (i) In the case of the Borrower, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstanding; (ii) in the case of Holding, (A) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02

Debt. Create, incur, assume or suffer to exist, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanDebt, except: (i) In in the case of the Borrower, , (A) Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates or foreign exchange rates, and not for speculative purposes, incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstanding;practice, (ii) in the case of Holding, (A) Debt under the Loan Documents, (B) Debt owed to a wholly owned Subsidiary of the Borrower, which Debt (x) shall be on subordinated terms reasonably acceptable to the Administrative Agent and (y) shall be evidenced by promissory notes in form and substance reasonably satisfactory to the Administrative Agent, (C) Debt in respect of the Senior Subordinated Notes, in an aggregate principal amount not to exceed $10,000,000 at 175,000,000 or, if the Senior Subordinated Notes are not issued, Debt in respect of the Bridge Loans in an aggregate principal amount not to exceed $85,000,000, and (D) Debt in respect of the Senior Notes, in an aggregate principal amount not to exceed $100,000,000. (ii) in the case of any time issued pursuant Subsidiary of the Borrower, Debt owed to the Stockholders Agreement Borrower or an Employment Agreement to a wholly owned Subsidiary of the Borrower, provided that (w) that, in each case, such Debt is (x) shall be on terms reasonably acceptable to the Administrative Agent and (y) shall be evidenced by a promissory note notes in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions substance reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding;Administrative Agent; and (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan DocumentsDocuments (which, in the case of Secured Hedge Agreements, should be consistent with the terms of Section 5.02(b)(i)(A)), (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 30,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 50,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date createdSurviving Debt, and aggregatingany Debt extending the maturity of, on a Consolidated basisor refunding or refinancing, not more than $7,500,000 at in whole or in part, any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions Surviving Debt and any Debt in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary respect of the Borrower after Senior Subordinated Notes or the date hereof in accordance with Senior Notes, provided that the terms of Section 5.02any such extending, refunding or refinancing Debt, and of any agreement entered into and of any instrument issued in connection therewith, are not otherwise prohibited by the Loan Documents, provided further that the principal amount of such Surviving Debt or Debt in respect of the Senior Subordinated Notes or the Senior Notes shall not be increased above the principal amount thereof outstanding immediately prior to such extension, refunding or refinancing, and the direct and contingent obligors therefor shall not be changed, as a result of or in connection with such extension, refunding or refinancing, provided still further that the terms relating to principal amount, amortization, maturity, collateral (if any) and subordination (if any), and other material terms taken as a whole, of any such extending, refunding or refinancing Debt, and of any agreement entered into and of any instrument issued in connection therewith, are no less favorable in any material respect to the Loan Parties or the Lender Parties than the terms of any agreement or instrument governing the Debt being extended, refunded or refinanced and the interest rate applicable to any such extending, refunding or refinancing Debt does not exceed the then applicable market interest rate,

Debt. Create, incur, assume or suffer to exist, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other than: (i) In the case of the Borrower, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstanding; (ii) in the case of Holding, (A) Debt under the Loan Documents, the Stock Purchase Facilities Documents and the Bridge Note Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 5,000,000 at any time issued pursuant outstanding to certain members of management of the Stockholders Agreement or an Employment Agreement Borrower in exchange for their equity ownership interests in Holding, provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) there is no amortization of such Debt is not required on or prior to the Termination Date, and (C) Debt under in connection with the 13% Subordinated Notes due May 31conversion of Preferred Stock of Holding with a liquidation value on the date of issue not in excess of $10,000,000, 2009 issued by Holding;provided that (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) there is no amortization of such Debt on or prior to the Termination Date, (iiiii) in the case of the Borrower Borrower, (A) on and its Subsidiariesafter the consummation of the Merger and so long as no Permanent Debt is outstanding, the Bridge Notes in an aggregate principal amount not to exceed $100,000,000, and (B) on and after the consummation of the Merger and so long as no Bridge Notes are outstanding, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000115,000,000; (iviii) in the case of any of the Subsidiaries of the Borrower, Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower Borrower, provided that any such Debt shall be (A) evidenced by the Borrower or any other wholly-owned Subsidiary a promissory note and (B) pledged in favor of the BorrowerLender Parties pursuant to the terms of the Security Agreement; and (viv) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv5.02(a)(vi) not to exceed in the aggregate $10,000,000 5,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 10,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 5,000,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing whether or other similar working capital financing) of any Person that becomes a Subsidiary not of the Borrower after the date hereof types described above in accordance with the terms of Section 5.02clauses (A) through (D)) in an aggregate principal amount not to exceed $2,500,000 at any time outstanding.

Debt. Create, incur, assume Become or suffer to existremain obligated for any Debt for borrowed money, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, for any Debt other thanincurred in connection with the acquisition of any property, real or personal, tangible or intangible, except: (ia) In the case Indebtedness to Lenders (or their Affiliates) hereunder, including without limitation, Hedging Obligations and Special Letters of Credit; (b) Debt not otherwise permitted hereunder which is in existence as of the BorrowerEffective Date and disclosed on Schedule 8.4 attached hereto, and any renewals or refinancing of such Debt in respect amounts not exceeding the scheduled amounts (less any required amortization according to the terms thereof), on terms no less favorable to the Company and its Subsidiaries than in effect on the Effective Date and otherwise in compliance with this Agreement, regardless of Hedge Agreements designed to hedge against fluctuations any less favorable terms which may result from changes in interest rates incurred market rates; (c) current unsecured trade, utility or non-extraordinary accounts payable arising in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstanding; (ii) in the case unsecured letters of Holding, (A) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) credit undertaken by such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred parties in the ordinary course of business outside the United States of America (and necessary under local customs and practices) to support such accounts payable; (d) purchase money Debt for fixed assets (including capitalized leases or other non-cancelable leases having a term of 12 months or longer), provided that the deferred aggregate amount of all such purchase price money Debt outstanding at any time shall not exceed seven and one-half percent (7.5%) of property Tangible Net Worth; (e) any Debt assumed pursuant to an acquisition conducted in compliance with this Agreement, provided that such Debt was not entered into, extended or servicesrenewed in contemplation of such acquisition and provided further that the aggregate amount of all such Debt at any time outstanding shall not exceed six percent (6%) of Tangible Net Worth; (f) Debt to third parties issued by any Foreign Subsidiary of the Company in an aggregate amount at any time outstanding not to exceed $55,000,000; provided that such Debt be issued and at all times maintained on a pari passu basis with the Indebtedness, maturing within one year from the date createdif any, of such Foreign Subsidiary, or on a basis subordinate thereto, and aggregatingpursuant to documentation containing covenants not more restrictive in the aggregate than the covenants contained in this Agreement (as determined by the Agent and Required Lenders in their reasonable discretion) and provided further, however, that immediately before and immediately after such Debt is incurred, and giving effect thereto, no Default or Event of Default has occurred and is continuing (it being understood that for purposes of this Section 8.4(f), the granting of Liens which are permitted under Section 8.5 hereof shall not be deemed to constitute the entry into more restrictive covenants or to be other than on a Consolidated pari passu basis); (g) Intercompany Loans, but only to the extent permitted under the other applicable terms and limitations of this Agreement, including but not limited to Section 8.7 hereof; (h) unsecured Debt issued under Rule 144A of the Securities Act of 1933 or pursuant to a private placement in an aggregate amount for all such Debt issued under this subparagraph (but without giving effect to any repayments or principal reductions thereof) not to exceed Two Hundred Million Dollars ($200,000,000); provided that such Debt be issued and all times maintained on a basis subordinate hereto, and pursuant to documentation containing covenants not more restrictive in the aggregate than $7,500,000 at any one time outstanding,the covenants contained in this Agreement (as determined by the Agent and the Required Lenders in their reasonable discretion); provided further, however, that immediately before and immediately after such Debt is incurred, and giving effect thereto, no Default or Event of Default has occurred and is continuing; and provided further that prior to or concurrently with the issuance of such Debt, the Revolving Credit Aggregate Commitment is permanently reduced by an amount equal to not less than 75% of the proceeds of such Debt, net of normal and customary expenses of issuance payable to third parties; (Ei) indorsement any reimbursement obligations arising in connection with the letters of negotiable instruments for deposit or collection or similar transactions credit described in the ordinary course of business, Schedule 8.3 attached hereto; and (Fj) the BCc Replacement Financing, the New Convertible Subordinated Debt (and any other than Subordinated Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02disclosed on Schedule 8.13 attached hereto.

Debt. CreateThe Parent Guarantor and the Borrower will not incur, incurcreate, assume or suffer to existexist any Debt, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanexcept: (ia) In the case Notes or other Indebtedness arising under the Loan Documents or any guaranty of or suretyship arrangement for the Notes or other Indebtedness arising under the Loan Documents. (b) Debt of the BorrowerParent Guarantor and the Borrower existing on the date hereof that is reflected in the Financial Statements, and any Permitted Refinancing Debt in respect thereof.74 (c) accounts payable and accrued expenses, liabilities or other obligations to pay the deferred purchase price of Hedge Agreements designed Property or services, from time to hedge against fluctuations in interest rates time incurred in the ordinary course of business which are not greater than 60 days past the date of invoice or delinquent or which are being contested in good faith by appropriate action and consistent for which adequate reserves have been maintained in accordance with prudent business practice with the aggregate Agreement Value thereof GAAP. (d) Debt under Capital Leases not to exceed $2,500,000 at any time outstanding;5,000,000. (ii) in the case of Holding, (Ae) Debt under associated with bonds or surety obligations required by Governmental Requirements in connection with the Loan Documents, operation of any Oil and Gas Properties. (Bf) intercompany Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant between Parent Guarantor and Borrower to the Stockholders Agreement or an Employment Agreement extent permitted by Section 9.05(g); provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior held, assigned, transferred, negotiated or pledged to any other Person, and; provided further, that any such Debt shall be subordinated to the Termination Date, and (C) Debt under Indebtedness on terms set forth in the 13% Subordinated Notes due May 31, 2009 issued by Holding;Guaranty Agreement. (iiig) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement endorsements of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and. (Fh) Debt under the Second Lien NotesFacility and any guarantees thereof, the principal amount of which does not exceed $75,000,000200,000,000 in the aggregate.75 (other than i) Debt comprised under (i) (i) Debt under the Convertible Notes, the principal amount of senior bank financing or other similar working capital financingwhich does not exceed $175,000,000 in the aggregate and (ii) of any Person that becomes a Subsidiary Permitted Refinancing Debt in respect of the Borrower after Convertible Notes and (iii) any guarantees thereof.of the date hereof foregoing.76 (j) other Debt not to exceed $5,000,000 in accordance with the terms aggregate at any one time outstanding. (k) (k) (i) Debt under the 2029 Convertible Notes, (ii) any Permitted Refinancing Debt of Section 5.02the 2029 Convertible Notes and (iii) any guarantees of the foregoing.49 (lk) Debt under (i) Debt under the 2019 High Yield Notes, the principal amount of which does not exceed $300,000,000 in the aggregate, (ii) any Permitted Refinancing Debt in respect of the 2019 High Yield Notes and (iii) any guarantees of the foregoing.77

Debt. CreateContract, create, incur, assume or suffer to existexist any Debt, or permit any of its Subsidiaries to contract, create, incur, assume or suffer to existexist any Debt, any Debt other than: except for (i) In Debt under this Agreement and the case other Loan Documents, (ii) subject to the Intercreditor Agreement, Debt under the Term Loan Agreement and the other Term Loan Documents and Refinancings (as such term is defined in the Intercreditor Agreement) thereof, (iii) Debt arising from Investments among the Borrowers and their respective Subsidiaries that are permitted hereunder, (iv) Debt in respect of the Borrowerany overdrafts and related liabilities arising from treasury, depository and cash management services or in connection with any automated clearing house transfers of funds; (v) Debt consisting of guaranties permitted by Section 5.02(c); (vi) Debt constituting purchase money debt and Capitalized Lease obligations (not otherwise included in subclause (ii) above) in an aggregate outstanding amount not in excess of $40,000,000, (vii) Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred entered into in the ordinary course of business (and consistent with prudent business practice with the aggregate Agreement Value thereof not for speculative purposes) to exceed $2,500,000 at any time outstanding; (ii) protect against fluctuations in the case of Holdinginterest rates, foreign exchange rates and commodity prices, (Aviii) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not indebtedness which may be deemed to exceed $10,000,000 at any time issued exist pursuant to the Stockholders Agreement any surety bonds, appeal bonds or similar obligations incurred in connection with any judgment not constituting a Default or an Employment Agreement provided that Event of Default; (wix) such Debt is evidenced by a promissory note indebtedness in substantially the form respect of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or netting services, maturing within one year from the date created, customary overdraft protections and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for otherwise in connection with deposit or collection or similar transactions accounts in the ordinary course of business, and (Fx) Debt not otherwise permitted hereunder in an aggregate outstanding principal amount of $30,000,000, (other than xi) Debt comprised permitted by Section 5.02(o); (xii) reimbursement obligations with respect to cash-collateralized letters of senior bank financing credit, in an aggregate amount not to exceed $50,000,000 at any time outstanding (whether contingent or other similar working capital financingactual), (xiii) Debt with respect to the Latam Credit Facilities and the QWI Cash Management Facilities; (xiv) Debt under the New Unsecured Notes (and any Permitted Refinancing thereof); (xv) Debt existing as of the Closing Date (including drawn and undrawn amounts under lines of credit), as specified in Schedule 5.02(b), and any Permitted Refinancings thereof and (xvi) Debt of any Person that becomes a Subsidiary of the Borrower after the date hereof Foreign Guarantor in accordance connection with the terms of any transaction permitted by Section 5.025.02(h)(viii) .

Debt. CreateNot, incur, assume or suffer to exist, or and not permit any of its Subsidiaries to Restricted Subsidiary to, create, incur, assume or suffer to existexist any Debt, except: (a) Obligations under this Agreement and the other Loan Documents; (b) Debt not otherwise permitted hereunder secured by Liens permitted by Section 7.2(d), and extensions, renewals and refinancings thereof; provided that the aggregate principal amount of all such Debt at any time outstanding shall not exceed $500,000; (c) Debt other than:of Borrower to any domestic Wholly-Owned Restricted Subsidiary or Debt of any domestic Wholly-Owned Restricted Subsidiary to Borrower or another domestic Wholly-Owned Restricted Subsidiary; (d) Debt of Chinese Subsidiary to Borrower not in excess of $500,000 at any time outstanding, less the amount of all Investments made in Chinese Subsidiary pursuant to Section 7.11(b); (e) intentionally omitted; (f) Hedging Obligations incurred in favor of a Lender or an Affiliate thereof for bona fide hedging purposes and not for speculation; (g) Debt (including Contingent Obligations) described on Schedule 7.1 as of the Closing Date, and any extension, renewal, refunding or refinancing thereof so long as the principal amount thereof is not increased; (h) the Trust Subordinated Debt in an aggregate outstanding principal amount not at any time exceeding $17,000,000, together with all accrued and unpaid interest thereon; (i) In the case of the Borrower, Audax Subordinated Debt in an aggregate outstanding principal amount not at any time exceeding $25,000,000 plus the aggregate outstanding amount of any PIK Notes issued in connection therewith, and all accrued and unpaid interest thereon; (j) the Senarc Debt in an aggregate outstanding principal amount not at any time exceeding $460,340.96, together with all accrued and unpaid interest thereon; (k) Contingent Obligations arising (i) with respect to customary indemnification obligations in favor of Hedge Agreements designed to hedge against fluctuations sellers in interest rates incurred connection with Acquisitions permitted under Section 7.5 and purchasers in connection with dispositions permitted under Section 7.5(b), (ii) in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at by Borrower or any time outstanding; (ii) in the case of Holdingits Restricted Subsidiaries guaranteeing obligations of Borrower or any of its domestic Restricted Subsidiaries, (A) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case favor of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred customers in the ordinary course of business for as a result of product warranties and (iv) in connection with unfunded pension fund and other employee benefit plan obligations, to the deferred purchase price of property or services, maturing within one year from extent the date created, and aggregating, on a Consolidated basis, same are not more than $7,500,000 at any one time outstanding,yet required to be funded; (El) indorsement Debt incurred in connection with Acquisitions permitted pursuant to Section 7.11(k); provided that the requirements of negotiable instruments for deposit or collection or similar transactions in the ordinary course clause (vii) of business, such Section are satisfied; and (Fm) other Debt, in addition to the Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of listed above, in an aggregate outstanding principal amount not at any Person that becomes a Subsidiary time exceeding $500,000, less the aggregate outstanding principal amount of the Borrower after the date hereof Senarc Debt at such time (but in accordance with the terms of Section 5.02no event less than zero).

Debt. Create, incur, assume or suffer to exist, or permit any of ---- its Subsidiaries to create, incur, assume or suffer to exist, any Debt other than: (i) In in the case of the BorrowerBorrower and the other Loan Parties, Debt in respect of Hedge Agreements designed incurred pursuant to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstandingLoan Documents; (ii) unsecured Debt (v) of the Borrower to any of its Domestic Subsidiaries, (w) of any Domestic Subsidiary of the Borrower to the Borrower or any other Domestic Subsidiary of the Borrower, (x) of any Wholly-Owned Foreign Subsidiary of the Borrower to the Borrower or any Domestic Subsidiary of the Borrower; provided, however, that the aggregate of all outstanding unsecured -------- ------- Debt of a Wholly-Owned Foreign Subsidiary of the Borrower to the Borrower or any Domestic Subsidiary of the Borrower and Investments by the Borrower or any Domestic Subsidiary of the Borrower in any Person organized under the case laws of Holding, any jurisdiction other than the United States of America or any state thereof as permitted pursuant to Section 5.02(e)(i) herein shall not exceed (A) Debt under the Loan Documents, $10,000,000 in any Fiscal Year or (B) Debt in an any event, $15,000,000 in the aggregate principal amount outstanding at any time, (y) of any Wholly-Owned Foreign Subsidiary of the Borrower to any other Wholly-Owned Foreign Subsidiary of the Borrower, and (z) of the Borrower or any Domestic Subsidiary of the Borrower to any Wholly-Owned Foreign Subsidiary of the Borrower not to exceed $10,000,000 15,000,000 in the aggregate outstanding at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holdingtime; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries,: (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv), in each case incurred only if, immediately after giving effect to the incurrence thereof, the limit on Capital Expenditures set forth in Section 5.02(p) hereof would not be breached; 101 (B) Debt incurred with respect to exceed Capitalized Leases, in each case incurred only if, immediately after giving effect to the aggregate $10,000,000 at any time outstanding,incurrence thereof, the limit on Capital Expenditures set forth in Section 5.02(p) hereof would not be breached; (C) Capitalized Leases the Surviving Debt, and any Debt extending the maturity of, or refunding or refinancing, in whole or in part, the Surviving Debt; provided that the principal amount or interest rate with respect thereto of such -------- Surviving Debt shall not to exceed in be increased above the aggregate $20,000,000 at any time outstanding,principal amount thereof outstanding and interest rate existing on the date hereof; (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02;

Debt. CreateThe Borrower will not, and will not permit any Subsidiary to, incur, create, assume or suffer to existexist any Debt, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanexcept: (ia) In the case Notes or other Indebtedness arising under the Loan Documents or any guaranty of or suretyship arrangement for the Borrower, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstanding; (ii) in the case of Holding, (A) Debt Notes or other Indebtedness arising under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding;. (iiib) in the case other Debt of the Borrower and its Subsidiaries, Subsidiaries existing on the Permanent date hereof that is reflected in the Financial Statements. (c) purchase money Debt in an aggregate principal amount and Debt under Capital Leases not to exceed $105,000,000;50,000,000 in the aggregate. (ivd) Debt owed to associated with workers’ compensation claims, performance, bid, surety or similar bonds or surety obligations required by Governmental Requirements or third parties in connection with the operation of the Oil and Gas Properties. (e) intercompany Debt between the Borrower by and PXP or any wholly-owned Subsidiary of thereof or between Subsidiaries; provided that (i) such Debt is not held, assigned, transferred, negotiated or pledged to any Person other than the Borrower or one of its Subsidiaries, (ii) that any such Debt owed to a wholly-owned Subsidiary of the Borrower by either the Borrower or any other wholly-owned a Subsidiary of Guarantor shall be subordinated to the BorrowerIndebtedness on terms set forth in the Subsidiary Guaranty; andand (iii) such Debt is not secured. (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (Bf) Debt secured by Liens permitted by Section 5.02(a)(iv9.02(d) and Section 9.02(e), the principal amount of which does not to exceed $50,000,000 in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding,time. (Eg) indorsement endorsements of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and. (Fh) Debt outstanding under one or more unsecured short term money market credit facilities the principal amount of which does not exceed $50,000,000 in the aggregate. (i) other than Debt comprised not to exceed $50,000,000 in the aggregate at any one time outstanding. (j) Any renewals, refinancings or extensions of senior bank financing or other similar working capital financing(but, except to the extent permitted herein, not increases in) any Debt described in clauses (b), (c), (e), (f) and (h) of any Person that becomes a Subsidiary this Section 9.01. (k) Debt consisting of the Borrower after financing of insurance premiums if the date hereof in accordance with amount financed does not exceed the terms of Section 5.02premium payable for the current policy period.

Debt. CreateThe Parent Guarantor and the Borrower will not incur, incurcreate, assume or suffer to existexist any Debt, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanexcept: (ia) In the case Notes or other Indebtedness arising under the Loan Documents or any guarantee of or suretyship arrangement for the Notes or other Indebtedness arising under the Loan Documents. (b) Debt of the BorrowerParent Guarantor and the Borrower existing on the date hereof that is reflected in the Financial Statements. (c) accounts payable and accrued expenses, Debt in respect liabilities or other obligations to pay the deferred purchase price of Hedge Agreements designed Property or services, from time to hedge against fluctuations in interest rates time incurred in the ordinary course of business which are not greater than 60 days past the date of invoice or delinquent or which are being contested in good faith by appropriate action and consistent for which adequate reserves have been maintained in accordance with prudent business practice with the aggregate Agreement Value thereof GAAP. (d) Debt under Capital Leases not to exceed $2,500,000 at any time outstanding;1,000,000. (ii) in the case of Holding, (Ae) Debt under associated with bonds or surety obligations required by Governmental Requirements in connection with the Loan Documents, operation of any Oil and Gas Properties. (Bf) intercompany Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant between Parent Guarantor and Borrower to the Stockholders Agreement or an Employment Agreement extent permitted by Section 9.05(g); provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior held, assigned, transferred, negotiated or pledged to any other Person, and; provided further, that any such Debt shall be subordinated to the Termination Date, and (C) Debt under Indebtedness on terms set forth in the 13% Subordinated Notes due May 31, 2009 issued by Holding;Guarantee Agreement. (iiig) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement endorsements of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and. (Fh) Debt not to exceed $265,000 under cash collateralized letters of credit, bonds, surety obligations and similar instruments. (i) other than Debt comprised not to exceed $1,000,000 in the aggregate at any one time outstanding. (j) Debt under any Second Lien Facility and any guarantees thereof, the original principal amount of senior bank financing or other similar working capital financing) of which does not exceed $40,000,000, plus any Person that becomes a Subsidiary of interest paid in kind thereon, in the Borrower after the date hereof in accordance with the terms of Section 5.02aggregate, and any Permitted Second Lien Refinancing Debt.

Debt. Create, incur, assume or suffer to exist, or permit any of its Subsidiaries to create, incur, assume or suffer to existexist any Debt, any Debt other thanexcept: (ia) In Debt described in Schedule 9.01, including renewals, extensions or refinancings thereof, provided that the case of the Borrower, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value principal amount thereof does not to exceed $2,500,000 at any time outstandingincrease; (iib) in other Debt of the case Company subordinated on terms reasonably satisfactory to the Lenders to the Company’s obligations under this Agreement and the Notes, the Letters of Holding, (A) Debt under the Loan Documents, (B) Debt Credit and Letter of Credit Agreements and any other Security Instrument in an aggregate principal amount not to exceed $10,000,000 25,000,000 at any one time issued pursuant outstanding; (c) Debt of the Company to the Stockholders Agreement any Guarantor or an Employment Agreement provided that (w) such Debt is evidenced by any other Subsidiary which becomes a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis Guarantor prior to the Termination Date, (y) the final maturity incurrence of such Debt, and Debt is after of any Guarantor or any such Subsidiary to the Termination Date and Company or to any other Guarantor or any such Subsidiary; (zd) amortization Debt of such Debt is not required the Company to any Subsidiary (other than a Guarantor or any Subsidiary which becomes a Guarantor prior to the Termination Date, and incurrence of such Debt) or Debt of any Subsidiary (Cother than a Guarantor or any Subsidiary which becomes a Guarantor prior to the incurrence of such Debt) Debt under to the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt Company in an aggregate principal amount not to exceed exceeding $105,000,0005,000,000 at any one time outstanding; (ive) Debt owed accounts payable (other than for borrowed money) to the Borrower by any wholly-owned Subsidiary of the Borrower trade creditors for goods or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt services incurred in the ordinary course of business and which are not in excess of 30 days past the due date, or, if greater than 30 days past due, are being contested in good faith and by appropriate proceedings; (f) Debt of the Company and any Subsidiary (other than newly-formed single purpose entity Subsidiaries created specifically for the deferred purpose of investing in project finance transactions) incurred to purchase price or to finance the purchase of, fixed assets in an aggregate principal amount not exceeding as to the Company and its Subsidiaries $25,000,000 at any time outstanding; (g) Debt of property the Company incurred in the ordinary course of business in connection with performance bonds required of operators by the Minerals Management Service or services, maturing within one year from other state or governmental agencies which the date created, Company is required to post in connection with its activities as operator of Oil and aggregating, on a Consolidated basis, not more than Gas Properties up to the aggregate amount of $7,500,000 25,000,000 at any one time outstanding,; provided, however, any outstanding utilization of performance bonds in excess of $5,000,000 shall reduce the availability on a dollar-for-dollar revolving basis of Revolving Credit Loans pursuant to Section 2.01(a); (Eh) indorsement Debt of negotiable instruments for deposit the Company in respect of judgment liens excepted under Section 9.03; (i) Debt of the Company and its Subsidiaries under Capital Leases (and any extensions or collection renewals thereof or similar transactions substitutions therefor) which do not in the ordinary course aggregate require the Company and its Subsidiaries on a consolidated basis to make payments (including, without limitation, rent, taxes, insurance, maintenance and similar expense which the Company or any Subsidiary is required to pay under the terms of businessany Capital Lease) in any calendar year in excess of $10,000,000; (j) Debt of the Company under or in respect of the Indenture and the Senior Subordinated Notes issued thereunder, and all amendments, supplements, renewals, extensions or refinancings thereof; provided, however, that (i) the aggregate principal amount of the Senior Subordinated Notes shall not exceed $175,000,000, provided, however, that the Company may enter into supplements to the Indenture having the effect of increasing the aggregate principal amount of the Senior Subordinated Notes with the prior written consent of the Required Lenders, (ii) payment of principal of, premium, if any, interest and other amounts owing or to be owing under, in connection with or evidenced by the Indenture or the Senior Subordinated Notes shall be subordinated to the payment of the Indebtedness on terms substantially as those set forth therein as of the Closing Date or otherwise reasonably satisfactory to the Administrative Agent, (iii) any amendment, supplement, renewal, extension or refinancing of the Indenture or any Senior Subordinated Note shall be on terms, taken as a whole, no more restrictive to the Company than the terms of the Indenture and the Senior Subordinated Notes as they exist on the Closing Date, provided, further, however, with respect to subclause (ii) hereof, the Indenture and the Senior Subordinated Notes may be prepaid with net proceeds of an equity offering, provided, further, however, if any refinancing of the Debt of the Company under or in respect of the Indenture or any Senior Subordinated Note permitted by the terms of this Agreement results in the Company receiving net proceeds in excess of the aggregate principal amount of the Senior Subordinated Notes outstanding on the Closing Date, the Borrowing Base shall be redetermined in accordance with Section 2.09; (k) Debt of the Company in connection with the Letters of Credit listed on Schedule 1.02(b); and (Fl) Debt (other than Debt comprised of senior bank financing the Notes or other similar working capital financing) Indebtedness or any guaranty of any Person that becomes a Subsidiary of or suretyship arrangement for the Borrower after the date hereof in accordance with the terms of Section 5.02Notes or other Indebtedness.

Debt. CreateIncur, incurcreate, assume or suffer permit to existexist any Debt, or permit any of its Subsidiaries to createhowsoever evidenced, incur, assume or suffer to exist, any Debt other thanexcept: (ia) In the case Debt existing as of the BorrowerEffective Date as set forth in Schedule 6C(2); provided, none of the instruments and agreements evidencing or governing such Debt shall be amended, supplemented or restated after the Effective Date to change any terms of subordination, repayment or rights of enforcement, conversion, put or exchange rights to be materially less favorable to the holders of the Notes than the terms and rights as in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in effect on the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstandingEffective Date; (ii) in the case of Holding, (Ab) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holdinghereunder; (iiic) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and; (Fd) Debt arising from Rate Hedging Obligations in an aggregate notional amount not to exceed at any time $40,000,000, which create Rate Hedging Obligations incurred to limit risks of currency or interest rate fluctuations to which the Company and its Subsidiaries are otherwise subject by virtue of the operations of their businesses, and not for speculative purposes; (e) purchase money Debt (other than the Parras Cone Debt) described in paragraph 6C(1)(v) not to exceed an aggregate outstanding principal amount at any time of $10,000,000; (f) Capitalized Lease Obligations not to exceed an aggregate principal amount at any time in excess of $5,000,000; (g) unsecured intercompany Debt comprised of senior bank financing for loans and advances made by the Company or other similar working capital financing) of any Person that becomes a Subsidiary Guarantor to the Company or any Guarantor, any such Debt of the Borrower after Company owing to any Guarantor shall be subordinate to payment of the date hereof Obligations hereunder at all times in accordance with the terms of Section 5.02the Facility Guaranty; (h) additional unsecured Debt for Money Borrowed not otherwise covered by clauses (a) through (g) above, provided that the aggregate outstanding principal amount of all such other Debt permitted under this clause (h) shall in no event exceed $10,000,000 at any time; (i) the Parras Cone Debt; (j) Debt extending the maturity of, or renewing, refunding or refinancing, in whole or in part, Debt incurred under clauses (a), (b), (g), (h) and (i) of this paragraph 6C(2), provided that the terms of any such extension, renewal, refunding or refinancing Debt (and of any agreement or instrument entered into in connection therewith) shall not change any terms of subordination, repayment or rights of enforcement, conversion, put or exchange rights to be materially less favorable to the holders of the Notes than the terms of the Debt as in effect prior to such action, and provided further that (1) the aggregate principal amount of such extended, renewed, refunded or refinanced Debt shall not be increased by such action, (2) the group of direct or contingent obligors on such Debt shall not be expanded as a result of any such action, and (3) immediately before and immediately after giving effect to any such extension, renewal, refunding or refinancing, no Default or Event of Default shall have occurred and be continuing; and (k) Securitization Outstandings or Indebtedness described in and secured by Liens permitted under paragraph 6C(1)(vii).

Debt. CreateThe Company will not, incur, assume or suffer to exist, or and will not permit any of its Subsidiaries to Subsidiary to, directly or indirectly, create, incur, assume assume, guarantee, or suffer to existotherwise become or remain directly or indirectly liable with respect to, any Debt other thanDebt, or create, issue, sell, or otherwise become or remain directly or indirectly liable with respect to, any Disqualified Stock, except that: (ia) In the case of Company may become and remain liable with respect to the Borrower, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in evidenced by the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstandingNotes; (iib) in the case of Holding, (A) Company and its subsidiaries may become and remain liable with respect to Debt under outstanding pursuant to the Loan Documents, (B) Debt Credit Agreement in an aggregate outstanding principal amount not to exceed $10,000,000 at any time of determination $48,000,000; (c) the Company may become and remain liable with respect to Debt incurred to refund the Debt outstanding under the Credit Agreement (which shall not include any extension or modification of the Credit Agreement or any restructuring of the Credit Agreement involving the same or substantially the same parties as the parties to the Credit Agreement on the date hereof) or any previous refunding thereof (any such Debt being referred to as "Refunding Debt") if (i) the principal amount of such Refunding Debt does not exceed the principal amount of the Debt being refunded, (ii) the Weighted Average Life to Maturity of such Refunding Debt is not shorter than that of the Debt being refunded, and (iii) the rate or rates of interest applicable to such Refunding Debt does not exceed by more than 2% the interest rate or rates (including the rate of interest payable upon the occurrence of any default or event of default thereunder) permitted to be charged under the Credit Agreement as in effect on the date hereof; (d) the Company and its Subsidiaries may remain liable with respect to Debt and Disqualified Stock outstanding on the date of this Agreement and referred to in Schedule B; (e) any Wholly-Owned Subsidiary may become and remain liable with respect to Debt owing to or Disqualified Stock held by the Company; (f) any Person that becomes a Wholly-Owned Subsidiary may remain liable with respect to its Debt and Disqualified Stock outstanding on the date it becomes a Wholly-Owned Subsidiary (other than Debt and Disqualified Stock incurred or issued in contemplation of its becoming a Wholly-Owned Subsidiary), provided that, on the date such Person becomes a Wholly-Owned Subsidiary and immediately after giving effect thereto, the Company could incur $1.00 of Debt pursuant to subdivision (k) of this section 10.1; (g) any Wholly-Owned Subsidiary may become and remain liable with respect to Debt or Disqualified Stock incurred or issued to refinance any Debt or Disqualified Stock outstanding pursuant to subdivision (d) or (f) of this section 10.1, provided that with respect to any such Debt or Disqualified Stock incurred or issued pursuant to this subdivision (g) (a "Refinancing Instrument")(i) the Stockholders Agreement principal amount or an Employment Agreement provided liquidation value of the Refinancing Instrument shall not exceed that of the Debt or Disqualified Stock 19 being refinanced plus reasonable fees and expenses incurred in connection with such refinancing; (wii) such the Refinancing Instrument shall have a final maturity later than that of the Debt is evidenced by or Disqualified Stock being refinanced and a promissory note in substantially Weighted Average Life to Maturity equal to or greater than that of the form of Exhibit B Debt or Disqualified Stock being refinanced; (iii) Debt issued to the Stockholders Agreement or otherwise subordinated refinance Debt subordinate in right of payment to the Obligations Notes shall be subordinate in right of Holding under the Loan Documents on terms and conditions reasonably satisfactory payment to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior Notes at least to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case extent of the Borrower Debt being refinanced; and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed shall not be issued to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02refinance Disqualified Stock;

Debt. Create, incur, assume or suffer to exist, or permit any of its Restricted Subsidiaries to create, incur, assume or suffer to exist, any Debt other than: (i) In in the case of the BorrowerBorrowers, (A) Subordinated Debt evidenced by the Subordinated Notes, and any Debt extending the maturity of, or refinancing, in whole or in part such Subordinated Notes, PROVIDED that the terms of any such extension or refinancing, and of any agreement entered into and of any instrument issued in connection therewith, are not prohibited by the Loan Documents, PROVIDED, FURTHER, that the principal amount of such Debt shall not be increased above the principal amount thereof outstanding immediately prior to such extension or refinancing, PROVIDED, FURTHER, that the terms relating to principal amount, amortization, maturity, interest rate, subordination, and other material terms of any such extension or refinancing and of any agreement entered into and of any instrument issued in connection therewith, are no less favorable in any material respect to the Loan Parties or the Lender Parties than the terms of the Subordinated Notes. (B) Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with practice, and (C) Debt consisting of any undertaking by the U.S. Borrower to guaranty the obligations of the Mexico Subsidiary, in an aggregate Agreement Value thereof principal amount not to exceed $2,500,000 at any time outstanding35,000,000; (ii) in the case of Holding, any of its Restricted Subsidiaries (A) Debt under owed to the Loan DocumentsBorrowers or to a Restricted Subsidiary of the Borrowers, and (B) in the case of the Mexico Subsidiary only, Debt in an aggregate principal amount not to exceed $10,000,000 35,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding;outstanding; and (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower Borrowers and any of its their Restricted Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) and Capitalized Leases not to exceed in the an aggregate amount equal to $10,000,000 50,000,000 at any time outstanding, (C) Capitalized Leases the Surviving Debt, and any Debt extending the maturity of, or refunding or refinancing, in whole or in part, any Surviving Debt, provided that the terms of any such extending, refunding or refinancing Debt, and of any agreement entered into and of any instrument issued in connection therewith, are not prohibited by the Loan Documents, PROVIDED that the principal amount of such Surviving Debt shall not be increased above the principal amount thereof outstanding immediately prior to exceed such extension, refunding or refinancing, and the direct and contingent obligors therefor shall not be changed, as a result of or in the aggregate $20,000,000 at any time outstandingconnection with such extension, refunding or refinancing, (D) unsecured Debt of any Person existing at the time such Person is merged into or consolidated with, or acquired by, either Borrower or any Restricted Subsidiary or becomes a Restricted Subsidiary of either Borrower in accordance with the provisions of Section 5.02(e)(xi) or (xii); PROVIDED that such Debt was not incurred in contemplation of such merger, consolidation or investment; and PROVIDED FURTHER that neither Borrower nor any Restricted Subsidiary which acquired such Person is liable for such Debt; and PROVIDED FURTHER, that the aggregate amount of all Debt incurred pursuant hereunder shall, when taken together with any Debt incurred pursuant to clause (F) of this Section 5.02(b)(iii), in no event exceed $100,000,000 in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 aggregate at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and, (F) Debt incurred in connection with an Investment made pursuant to Section 5.02(e)(xi) or (other than xii); PROVIDED, that the aggregate amount of all Debt comprised of senior bank financing or other similar working capital financingincurred pursuant hereunder shall, when taken together with any Debt incurred pursuant to clause (D) of this Section 5.02(b)(iii), in no event exceed $100,000,000 in the aggregate at any Person that becomes a Subsidiary time outstanding, (G) Debt consisting of guaranty Obligations in the ordinary course of business of the obligations of suppliers, customers, franchisees and licensees of the U.S. Borrower after and its Restricted Subsidiaries, (H) Debt in respect of any bankers' acceptance, letter of credit, warehouse receipt or similar facilities entered into in the date hereof ordinary course of business, and (I) other Debt outstanding in accordance with the terms of Section 5.02an aggregate amount not to exceed $50,000,000 at any time outstanding.

Debt. Create, incur, assume issue or suffer to existexist any Debt, or permit except any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanthe following: (i) In the case of the Borrower, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstanding; (ii) in the case of Holding, (Aa) Debt under the Loan Documents; (b) Debt outstanding on the Closing Date and listed on Schedule 6.09 and extensions, renewals and refinancings of such Debt; provided that (Bi) the amount of such Debt is not increased at the time of such extension, renewal or refinancing unless permitted by Section 8.01(f) and (ii) the terms relating to principal amount, amortization, maturity, collateral (if any) and subordination (if any), and other material terms taken as a whole, of any such refinancing, refunding, renewing or extending Debt, and of any agreement entered into and of any instrument issued in connection therewith, are no less favorable in any material respect to the Borrowers and the Restricted Subsidiaries or the Lenders than the terms of any agreement or instrument governing the Debt being refinanced, refunded, renewed or extended and the interest rate applicable to any such refinancing, refunding, renewing or extending Debt does not exceed the then applicable market interest rate; (c) Debt in an respect of, under, or consisting of Permitted Hedging Obligations; (d) Debt in respect of capital leases and purchase money obligations for fixed or capital assets; provided that the aggregate principal amount of all such Debt at any one time outstanding shall not to exceed $10,000,000 at 5,000,000 (or its equivalent in other currencies); (e) Debt incurred by any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided Loan Party that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations in the form of Holding under unsecured or junior lien subordinated debt (“Subordinated Debt”); provided that (i) immediately before and after the Loan Documents incurrence of such Subordinated Debt, (A) no Event of Default shall exist or would result therefrom and (B) the Borrowers shall be in compliance on terms a Pro Forma Basis with (1) a Consolidated Interest Coverage Ratio greater than 2.50:1.00 and conditions (y) a Consolidated Total Leverage Ratio not to exceed 5.00:1.00, and (ii) any such Subordinated Debt (A) shall be subject to Approved Subordination Terms or otherwise subject to an intercreditor or subordination agreement reasonably satisfactory to the Lender PartiesRequired Lenders, (xB) such Debt shall have a maturity date no earlier than twelve months after the Maturity Date, (C) shall not bear interest on a cash basis have any scheduled amortization payments prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Maturity Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iiiD) in the case of any junior lien Subordinated Debt, such Subordinated Debt shall not be secured by a Lien on any collateral that is not Collateral securing the Obligations under this Agreement and the other Loan Documents; (f) Permitted Project Debt; (g) to the extent constituting Debt, (i) the BVI O&M Parent Guarantee and (ii) other customary performance guarantees entered into in the ordinary course of business which support the obligations of a Restricted Subsidiary of BVI Borrower (a “Permitted Performance Guarantee”); provided that, at the time any such guarantee is entered into pursuant to the foregoing clause (ii), no Event of Default shall have occurred and be continuing or would result therefrom; (h) Debt arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business, provided that such Debt is extinguished promptly upon its Subsidiaries, the Permanent incurrence; (i) Debt in respect of netting services, overdraft protections and similar arrangements in connection with deposit accounts; (j) to the extent constituting Debt, financing arrangements in respect of Vehicles used in the Businesses not to exceed an aggregate principal amount not to exceed of $105,000,0002,500,000 outstanding at any one time; (ivk) Debt owed to assumed by a Restricted Subsidiary in connection with a Permitted Acquisition under a facility for the Borrower by any wholly-owned Subsidiary factoring of the Borrower or accounts receivable; provided that such Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt was incurred in the ordinary course of business for of the target of such Permitted Acquisition, on arm’s length commercial terms, and not in contemplation of such Permitted Acquisition; (l) earn-outs, seller notes, purchase price adjustment or similar deferred purchase price of property or services, maturing within one year from the date created, compensation obligations entered into or assumed in connection with a Permitted Acquisition or other permitted Investment or Disposition and aggregating, on other Debt assumed in connection with a Consolidated basis, not more than $7,500,000 at any one time outstanding, Permitted Acquisition (E) indorsement of negotiable instruments for deposit or collection or similar transactions provided that such Debt was incurred in the ordinary course of businessbusiness of the target of such Permitted Acquisition, on arm’s length commercial terms, and not in contemplation of such Permitted Acquisition), so long as, such obligations are either (i) unsecured and, if not subordinated to the Obligations pursuant to Approved Subordination Terms or other subordination or intercreditor terms otherwise reasonably satisfactory to the Required Lenders, not in excess of an aggregate principal amount of $5,000,000, or (ii) if secured, both (A) subordinated to the Obligations pursuant to Approved Subordination Terms or other subordination or intercreditor terms otherwise reasonably satisfactory to the Required Lenders and (B) not in excess of an aggregate principal amount of $2,500,000 at any time outstanding; and (Fm) Debt earn-outs, seller notes, purchase price adjustment or similar deferred purchase price or compensation obligations entered into or assumed in connection with (other than Debt comprised of senior bank financing or other similar working capital financingi) of any Person that becomes a Subsidiary of the Borrower after the date hereof Project Salt in accordance with the terms Memorandum of Section 5.02Understanding with respect thereto dated as of June 28, 2017, or (ii) such other Projects as the Required Lenders shall reasonably agree to in writing, in each case so long as, (A) an amount of cash equal to the maximum amount of such deferred obligations in respect of such Investment shall not be included in the calculation of Unrestricted Cash of the Loan Group for purposes of satisfying the Liquidity Condition in connection with such Investment, and (B) such obligations are not secured by any Collateral other than by funds required to satisfy such obligations that are placed into escrow at the time of the Investment; (n) Debt in respect of any letters of credit in the aggregate amount at any time outstanding not to exceed an aggregate principal amount of $5,000,000; (o) other Debt not to exceed an aggregate principal amount of $5,000,000 outstanding at any time; and (p) prior to the consummation of the Refinancing, the Refinancing Debt.

Debt. CreateThe Borrower will not, incurand will not permit any Subsidiary to, assume incur or suffer permit to existexist any Debt, except: (a) Debt evidenced by the Notes or the Facility Letter of Credit Obligations, or permit outstanding under any Equity-Preferred Securities (to the extent the same constitutes Debt) not in default, as well as (i) Debt of Panhandle Eastern and/or any of its Subsidiaries, so long as (A) such Debt is otherwise permitted under Section 10.3(g) and (B) after giving effect to the issuance of such Debt, the ratio of Consolidated Total Indebtedness to Consolidated Total Capitalization for Panhandle Eastern and Panhandle Eastern’s Subsidiaries (excluding the Borrower and all other Subsidiaries of the Borrower for purposes of such calculation) is no greater than 0.65 to create1.00, incur, assume and (ii) any loans or suffer advances by the Borrower to exist, Panhandle Eastern and/or any Debt other than: (i) In the case of the Borrower’s other Subsidiaries permitted under Section 10.4(b); (b) Debt of any Subsidiary to the Borrower or any other Subsidiary, except to the extent limited by the terms of Section 10.4(b), and Debt in respect of Hedge Agreements designed the Borrower to hedge against fluctuations in interest rates incurred any Subsidiary; (c) Debt existing as of March 31, 2008 as reflected on financial statements delivered under Section 7.2(b) and refinancings thereof other than Debt that has been refinanced by the proceeds of Loans; (d) endorsements in the ordinary course of business and consistent with prudent business practice with of negotiable instruments in the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstandingcourse of collection; (e) Debt of the Borrower or any Subsidiary representing the portion of the purchase price of property acquired by the Borrower or such Subsidiary that is secured by Liens permitted by the provisions of Section 10.2(d); provided, however, that at no time may the aggregate principal amount of such Debt outstanding exceed thirty percent (30%) of the Consolidated Net Worth of the Borrower and its Subsidiaries as of the applicable determination date; (f) Debt evidenced by Senior Notes; (g) additional Debt of the Borrower, and additional Debt of Panhandle Eastern and/or any of Panhandle Eastern’s Subsidiaries (so long as such additional Debt of Panhandle Eastern and/or any of Panhandle Eastern’s Subsidiaries is otherwise permitted under Section 10.3(a)), provided that after giving effect to the issuance thereof, there shall exist no Default or Event of Default; and (i) the ratio of Consolidated Total Indebtedness to Consolidated Total Capitalization shall be no greater than 0.65 to 1.00 at all times; (ii) the ratio of EBDIT for the four fiscal quarters most recently ended to pro forma Cash Interest Expense for the following four fiscal quarters shall be no less than 2.00 to 1.0 at all times; provided, however, that if the additional Debt for which the determinations required to be made by this subparagraph (g) will be used to finance in whole or in part the case consideration to be paid by the Borrower for the acquisition of Holdingany entity otherwise permitted under the terms of this Agreement, the determination of EBDIT for purposes of this ratio shall include not only the EBDIT of the Borrower and its Subsidiaries for the four fiscal quarters most recently ended, but shall also include the EBDIT of such entity to be acquired for such four fiscal quarters most recently ended; and (iii) (A) such Debt under shall have a final maturity or mandatory redemption date, as the Loan Documentscase may be, no earlier than the Maturity Date and shall mature or be subject to mandatory redemption or mandatory defeasance no earlier than the Maturity Date (as so extended) and shall be subject to no mandatory redemption or “put” to the Borrower, Panhandle Eastern or any of Panhandle Eastern’s Subsidiaries exercisable, or sinking fund or other similar mandatory principal payment provisions that require payments to be made toward principal, prior to such Maturity Date (as so extended); or (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such additional Debt shall not bear interest on have a cash basis final maturity date prior to the Termination Maturity Date, (y) such additional Debt shall not exceed Two Hundred Fifty Million Dollars ($250,000,000.00) in the final maturity aggregate plus Twenty Million Dollars ($20,000,000.00) of such Debt is after the Termination Date reimbursement obligations incurred in connection with Non-Facility Letters of Credit issued by a Bank or Banks or by any other financial institution, and (z) amortization such additional Debt shall be borrowed from a Bank or Banks as a loan or loans arising independent of this Agreement or shall be borrowed from a financial institution that is not a Bank under this Agreement; and (h) additional Debt of Trunkline LNG Holdings or any of its Subsidiaries, so long as (i) such Debt is to Trunkline LNG Holdings and/or any of its Subsidiaries only and is not required prior recourse in any respect to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower (other than Panhandle Eastern and its Subsidiaries), (ii) the proceeds of such Debt is used solely to finance capital expenditures of Trunkline LNG Holdings and/or its Subsidiaries, and (iii) after the date hereof in accordance with the terms giving effect to such Debt, no Default or Event of Section 5.02Default shall exist.

Debt. CreateNeither Holdings, the US Borrower nor any Subsidiary will incur, create, assume or suffer permit to existexist any Debt, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanexcept: (ia) In the case Notes or other Indebtedness or any guaranty of or suretyship arrangement for the Notes or other Indebtedness; (b) Debt (including unfunded commitments) of the BorrowerUS Borrower or Holdings existing on the Closing Date which is reflected in the Financial Statements or is disclosed in Schedule 10.01, Debt in respect and any renewals, extensions, refinancings and modifications (but not increases) thereof; (c) accounts payable (for the deferred purchase price of Hedge Agreements designed Property or services) from time to hedge against fluctuations in interest rates time incurred in the ordinary course of business which, if greater than 90 days past the invoice or billing date, are being contested in good faith by appropriate proceedings if reserves adequate under GAAP shall have been established therefor; (d) Debt of the US Borrower under Hedging Agreements which are for bona fide business purposes and consistent with prudent business practice with are not speculative; (e) Operating Equipment Lease Obligations; (f) other Debt of the aggregate Agreement Value thereof US Borrower and its Domestic Subsidiaries incurred, not to exceed $2,500,000 35,000,000 in the aggregate; (g) Debt evidenced by Capital Lease Obligations and Purchase Money Indebtedness; provided that in no event shall the aggregate principal amount of Capital Lease Obligations and Purchase Money Indebtedness permitted by this clause (g) exceed $30,000,000 at any time outstanding; (ii) in the case of Holding, (Ah) Debt under the Loan Documentswith respect to surety bonds, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement appeal bonds or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not customs bonds required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for or in connection with the deferred purchase price enforcement of property rights or servicesclaims of the US Borrower or any of its Subsidiaries or in connection with judgments that do not result in a Default or an Event of Default, maturing within one year from provided that the date createdaggregate outstanding amount of all cash surety bonds, appeal bonds and aggregating, on a Consolidated basis, custom bonds permitted by this clause (h) shall not more than $7,500,000 at any one time outstanding,exceed $5,000,000; (Ei) indorsement Debt of negotiable instruments any Foreign Subsidiary of the US Borrower or Holdings the proceeds of which Debt are used for deposit or collection or similar transactions in the ordinary course of business, such Foreign Subsidiary's and/or its Foreign Subsidiaries' working capital and general business purposes ("Foreign Subsidiary Indebtedness"); and (Fj) Debt (other than Debt comprised for borrowed money assumed by the US Borrower or one of senior bank financing its Subsidiaries, or other similar working capital financing) of any Person that becomes a Subsidiary of the US Borrower after the date hereof in accordance with acquired, pursuant to an acquisition or merger permitted pursuant to the terms of Section 5.02this Agreement, provided that such Debt shall not exceed $65,000,000 in the aggregate at any time and such Debt was not incurred in connection with, or in anticipation or contemplation of such permitted acquisition or merger; and provided further that the aggregate amount of Debt permitted pursuant to this clause (j) that has a scheduled maturity date that is earlier than the scheduled Revolving Credit Termination Date shall not exceed $30,000,000.

Debt. CreateNeither the Borrower nor any Material Subsidiary ---- will incur, incurcreate, assume or suffer to existexist any Debt, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanexcept: (ia) In the case Notes or other Indebtedness arising under the Loan Documents or any guaranty of or suretyship arrangement for the Notes or other Indebtedness arising under the Loan Documents. (b) Debt of the BorrowerBorrower and its Material Subsidiaries existing on the date hereof that is reflected in the Financial Statements, and any Permitted Refinancing Debt in respect thereof. (c) accounts payable (for the deferred purchase price of Hedge Agreements designed Property or services) from time to hedge against fluctuations in interest rates time incurred in the ordinary course of business which are not greater than sixty (60) days past the date of invoice or delinquent or which are being contested in good faith by appropriate action and consistent for which adequate reserves have been maintained in accordance with prudent business practice with the aggregate Agreement Value thereof GAAP. (d) Debt under Capital Leases not to exceed $2,500,000 at any time outstanding;5,000,000. (ii) in the case of Holding, (Ae) Debt under associated with bonds or surety obligations required by Governmental Requirements in connection with the Loan Documents, operation of the Oil and Gas Properties. (Bf) intercompany Debt in an aggregate principal amount not to exceed $10,000,000 at between the Borrower and any time issued pursuant Material Subsidiary or between Material Subsidiaries to the Stockholders Agreement or an Employment Agreement extent permitted by Section 9.05(g); provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior held, assigned, transferred, negotiated or pledged to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of Person other than the Borrower or one of its Wholly-Owned Subsidiaries, and, provided further, that any such Debt owed to a wholly-owned Subsidiary of the Borrower by either the Borrower or any other wholly-owned Subsidiary of a Guarantor shall be subordinated to the Borrower; andIndebtedness on terms set forth in the Guaranty Agreement. (vg) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement endorsements of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and. (Fh) non-recourse Debt (secured by Property other than Oil and Gas Properties evaluated by the Lenders for purposes of establishing the Borrowing Base not to exceed $10,000,000 in the aggregate at any one time outstanding. (i) other Debt comprised of senior bank financing or other similar working capital financing) of not to exceed $5,000,000 in the aggregate at any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02one time outstanding.

Debt. Create, incur, assume or suffer to exist, or permit Neither such Loan Party nor any of its Subsidiaries to createshall incur or maintain any Debt, incur, assume or suffer to exist, any Debt other than: (ia) In the case of the Borrower, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstandingObligations; (b) Debt described on Schedule 6.9; (c) Capital Leases of Fixed Assets and purchase money secured Debt incurred to purchase Fixed Assets provided that (i) Liens securing the same attach only to the Fixed Assets acquired by the incurrence of such Debt and (ii) in the case aggregate amount of Holdingsuch Debt (including Capital Leases) of all Loan Parties outstanding does not exceed $10,000,000 at any time; (x) Xxxx xxxxxxxxx xxxxx xxxxxxx (x), (Ax) and (k) of the definition of Restricted Investments; (e) Debt evidencing a refunding, renewal or extension of the Debt described on Schedule 6.9; provided that (i) the principal amount thereof is not increased, (ii) the Liens, if any, securing such refunded, renewed or extended Debt do not attach to any assets in addition to those assets, if any, securing the Debt to be refunded, renewed or extended, (iii) no Person that is not an obligor or guarantor of such Debt as of the Closing Date shall become an obligor or guarantor thereof, and (iv) the terms of such refunding, renewal or extension are no less favorable to such Loan Party, the Agent or the Lenders than the original Debt; (f) Debt under the Term Loan Documents, (B) Debt Agreement in an aggregate principal amount outstanding at any time not to exceed $10,000,000 at 250,000,000 less all payments and prepayments of principal made on such Debt and the refinancing thereof (the Debt under such refinancing, the "Refinancing Term Loan Debt" and the agreements evidencing or governing the Refinancing Term Loan Debt, collectively, the "Refinancing Term Loan Debt Agreement"); provided that such refinancing shall be permitted only so long as (i) all, and not a portion of, the Debt owing under the Term Loan Agreement is refinanced and the principal amount of such refinancing is not greater than the principal amount of Debt being refinanced (unless otherwise agreed to by the Agent and the Required Lenders), (ii) the Liens, if any, securing such refinancing do not attach to any time issued pursuant assets in addition to those assets securing the Debt under the Term Loan Agreement and those Liens shall be junior and subordinate to the Stockholders Agreement Agent's Liens and be subject to the terms and conditions of an intercreditor agreement between the Agent and the holders of the Refinancing Term Loan Debt (or an Employment Agreement provided that (wagent or trustee therefor) such Debt is evidenced by a promissory note in substantially the form of Exhibit B identical to the Stockholders Intercreditor Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender PartiesAgent and the Required Lenders, (xiii) no Person that is not an obligor or guarantor of such Debt shall not bear interest on a cash basis under the Term Loan Agreement immediately prior to the refinancing shall become an obligor or guarantor of the Refinancing Term Loan Debt, (iv) the terms under the Refinancing Term Loan Debt Agreement, taken as a whole, are no less favorable in all material respects to the Loan Parties, the Agent and the Lenders than the terms under the Term Loan Agreement (provided, however, that the interest rate may be at a market rate), (v) no principal payments of such refinancing shall be due and payable on or prior to the Stated Termination Date, (yvi) no Default or Event of Default shall exist either immediately prior to or after giving effect to such refinancing and (vii) the final maturity Fixed Charge Coverage Ratio (calculated without giving effect to clause (F) of the definition of Fixed Charges) shall be greater than 1.10:1.00 for the twelve consecutive fiscal month period ended on the last day of the fiscal month most recently ended prior to such refinancing for which the Agent has received Financial Statements under Section 5.2(c) on a pro forma basis after giving effect to such refinancing (as if such refinancing were consummated on the first day of such Debt is after twelve consecutive fiscal month period) (and the Termination Date and (z) amortization of such Debt is not required prior Parent has delivered to the Termination Date, Agent a certificate signed by a Responsible Officer of the Parent demonstrating compliance with such ratio test and (C) Debt under setting forth in reasonable detail the 13% Subordinated Notes due May 31, 2009 issued by Holdingrelevant calculations); (iiig) in the case Debt of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount Non-Loan Parties not to exceed $105,000,00020,000,000 ($30,000,000 after the second Anniversary Date) in the aggregate outstanding at any time; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (Ah) Debt under the Loan Documents, clause (Bb) Debt of such defined term secured by Permitted Liens permitted by Section 5.02(a)(iv) that does not constitute any of the following: indebtedness for borrowed money, indebtedness under or with respect to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Capital Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for or conditional sales or other title retention agreements, the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit indebtedness under or collection with respect to Guaranties or similar transactions in the ordinary course of business, synthetic leases; and (Fi) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Guaranties permitted by Section 5.027.14.

Debt. Create, incur, assume or suffer to exist, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other than: (i) In in the case of the Borrower, , (A) Debt under the Loan Documents; (B) Permitted Subordinated Debt; (C) Debt in respect of Hedge Agreements designed entered into in order to hedge against fluctuations manage existing or anticipated interest rate or exchange rate risks and not for speculative purposes and subordinated to the rights of the Lender Parties hereunder in interest rates incurred a manner that is acceptable to the Required Lenders in the ordinary course of business and consistent with prudent business practice with the an aggregate Agreement Value thereof notional amount not to exceed $2,500,000 50,000,000 at any time outstanding; (ii) in the case of Holding, any of its Subsidiaries (other than any Excluded Subsidiary or any Inactive Foreign Subsidiary), (A) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (viii) in the case of the Borrower and any of its Subsidiaries, (A) Debt under secured by Permitted Liens described in clause (c) or (d) of the Loan Documents,definition of Permitted Liens; provided, however, that the principal amount of any such Debt incurred during any fiscal year shall not exceed $15,000,000; (B) the Surviving Debt; (C) Debt secured by Liens permitted by Section 5.02(a)(ivconsisting of Capitalized Leases entered into pursuant to Permitted Sale-Leaseback Transactions; (D) Debt of the Borrower in an aggregate principal amount not to exceed in $20,000,000 incurred with respect to any Permitted Sale- Leaseback Repurchase; (E) Debt of any Excluded Subsidiary permitted by the aggregate organizational documents of such Excluded Subsidiary; (F) Debt consisting of a Permitted Refinancing; (G) additional unsecured Debt of the Borrower and its Subsidiaries not to exceed $10,000,000 25,000,000 at any time outstanding,; and (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (EH) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business; provided, and however, that notwithstanding any contrary provision hereof or of any other Loan Document, the Borrower shall not incur any Indebtedness (Fas defined in the indenture relating to the senior subordinated notes of the Borrower described in clause (A) Debt (of the definition of "Permitted Subordinated Debt"), other than Debt comprised of senior bank financing or other similar working capital financingunder the Loan Documents, in reliance upon clause (i) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms second paragraph of Section 5.024.07(a) of such indenture or in reliance on any corresponding provision of any Permitted Refinancing thereof.

Debt. Create, incur, assume or suffer to exist, Shall not create or permit to exist any of its Subsidiaries to createDebt, incurincluding any guaranties or other contingent obligations, assume or suffer to exist, any Debt other than:except the following ("Permitted Debt"): (ia) In The Obligations; (b) Endorsement of checks for collection in the case ordinary course of the Borrower, business; (c) Debt in respect of Hedge Agreements designed payable to hedge against fluctuations in interest rates incurred suppliers and other trade creditors in the ordinary course of business on ordinary and consistent with prudent business practice with the customary trade terms and which is not past due; (d) Purchase money Debt not exceeding $500,000 in aggregate Agreement Value thereof not to exceed $2,500,000 principal amount at any time outstandingoutstanding for Borrowers and all Subsidiaries incurred to purchase Equipment, provided that the amount of such Debt shall not at any time exceed the purchase price of the Equipment purchased; (iie) Unsecured Debt not exceeding $250,000 in principal amount outstanding at any time for Borrowers and all Subsidiaries (other than the ERC Intercompany Payable; (f) Debt existing on the Closing Date and not otherwise permitted under this Section 6.1, as set forth on Exhibit 6.1 hereto, and the renewal and refinancing (but not the increase in the case aggregate principal amount) thereof; (g) Any Debt incurred under any Swap Agreements with Bank (or with any of Holding, its Affiliates); (Ah) Debt under the Loan Documents, (B) Debt of all Foreign Subsidiaries in an aggregate principal amount not to exceed $10,000,000 95,000,000 in the aggregate incurred solely in connection with the issuance of letters of credit on behalf of such Foreign Subsidiaries, and any collateral pledged to secure such Debt shall not exceed an amount in excess of 35% of such Debt; (i) From the Closing Date through and including March 31, 2006, guarantees by ERC US of up to $5,000,000 (or its equivalent in other currencies) of the aggregate liability of all Foreign Subsidiaries or other trade letter of credit facilities permitted by 6.1(h) and (ii) at all times thereafter, guarantees by ERC US of up to $7,500,000 (or its equivalent in other currencies) of the aggregate liability of all Foreign Subsidiaries or other trade letter of credit facilities permitted by 6.1(h); (j) ERC Intercompany Payable in the aggregate principal amount of $43,000,000 during the fiscal year ending March 31, 2006 plus an additional $2,000,000 for each fiscal year thereafter. ERC US shall not (i) at any time issued pursuant reduce the outstanding principal amount of the ERC Intercompany Payable to an amount that is less than $43,000,000 during the fiscal year ended March 31, 2006 plus an additional $2,000,000 for each fiscal year thereafter, and (ii) make any payment with respect thereto at any time during which an Event of Default has occurred and is continuing. None of ER Hong Kong, ER BVI or ER Macao shall effect a transfer of the ER Intercompany Payable; (k) Unsecured Debt owing incurred in connection with Permitted Acquisitions and payable to the Stockholders Agreement corresponding sellers of the Acquired Company or an Employment Agreement provided Acquired Assets that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise expressly subordinated in right of payment and performance to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02subordination agreements approved in writing by Bank in its reasonable discretion.

Debt. Create, incur, assume or suffer to exist, Incur or permit any of its Subsidiaries to create, incur, assume or suffer to exist, Incur any Debt other than: (i) In Debt under the case of the Borrower, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstandingPurchase Documents; (ii) Debt outstanding as of the Closing Date under the Second Lien Loan Documents in an aggregate principal amount not to exceed (a) $55,715,294 minus (b) the case sum of Holdingany principal prepayments made on such Debt after the date hereof (plus paid-in-kind interest thereon in accordance with the Second Lien Loan Documents), as the same may be refinanced or replaced from time to time, so long as all of the following conditions are met: (A) such refinancing or replacement does not shorten the maturity date or weighted average life to maturity date of the Debt under the Loan Documentsbeing refinanced or replaced, (B) such refinancing or replacement does not increase the non-default interest rate by more than 200 basis points (unless the Purchase Documents are also amended to permit an equivalent increase), (C) the priority of the Liens and guaranties thereunder do not change (and continue to be subject to the Intercreditor and Subordination Agreements), (D) the principal amount of the refinanced or replaced Debt does not exceed the maximum principal amount of Debt permitted to be incurred pursuant to this clause (ii), and (E) the covenants, defaults and other material provisions thereof are not made materially more restrictive; (iii) Debt of the Obligors under First Lien Documents outstanding at any time in an aggregate principal amount not to exceed $10,000,000 at 230,000,000, minus the sum of any principal payments and prepayments made on the First Lien Notes after the date hereof in accordance with the First Lien Documents (other than refinancings in full) (plus paid-in-kind interest thereon in accordance with the First Lien Documents) plus Debt Incurred under the First Lien Documents after a Default or Event of Default consisting of protective advances made by the First Lien Lenders directly to Persons unrelated to the Issuer for the sole purpose of protecting or preserving the value of the Collateral, as the same may be refinanced or replaced from time issued to time, so long as all of the following conditions are met: (A) such refinancing or replacement does not shorten the maturity date or weighted average life to maturity date of the Debt being refinanced or replaced, (B) such refinancing or replacement does not increase the non-default interest rate by more than 200 basis points (unless the Purchase Documents are also amended to permit an equivalent increase), (C) the priority of the Liens and guaranties thereunder do not change (and continue to be subject to the Second Lien Intercreditor and Subordination Agreement), (D) the principal amount of the refinanced or replaced Debt does not exceed the maximum principal amount of Debt permitted to be incurred pursuant to the Stockholders Agreement or an Employment Agreement provided that this clause (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Dateiii), and (CE) Debt under the 13% Subordinated Notes due May 31covenants, 2009 issued by Holding; (iii) in the case of the Borrower defaults and its Subsidiaries, the Permanent Debt in an aggregate principal amount other material provisions thereof are not to exceed $105,000,000made materially more restrictive; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any Capitalized Leases (other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(ivthan Surviving Debt) not to exceed in the aggregate $10,000,000 at any time outstanding,7,500,000; (Cv) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02Surviving Debt;

Debt. Create, incur, assume or suffer to existexist any Debt, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanexcept: (i) In the case of the Borrower, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstanding; (ii) in the case of Holding, (Aa) Debt under the Loan Documents, ; (Bb) Debt outstanding on the date hereof and listed on Schedule 7.03 and any refinancings, refundings, renewals or extensions thereof; provided that the amount of such Debt is not increased at the time of such refinancing, refunding, renewal or extension except by an amount equal to a reasonable premium or other reasonable amount paid, and fees and expenses reasonably incurred, in connection with such refinancing and by an amount equal to any existing commitments unutilized thereunder; (c) intercompany Debt owed between any Subsidiary of the Borrower and the Borrower, provided that the payment of such Debt is subordinated to the payment of the Obligations pursuant to Section 10.22 or otherwise in a manner satisfactory to the Administrative Agent; (d) Subordinated Debt in an aggregate principal amount not at any time to exceed $20,000,000; (e) so long as there exists no Default both before and after giving effect to any such transaction, obligations (contingent or otherwise) of the Borrower or any Subsidiary existing or arising under any Swap Contract, provided that (i) such obligations are (or were) entered into by such Person in the Ordinary Course of Business for the purpose of directly mitigating risks associated with liabilities, commitments, investments, assets, or property held or reasonably anticipated by such Person, or changes in the value of securities issued by such Person, and not for purposes of speculation or taking a “market view;” and (ii) such Swap Contract does not contain any provision exonerating the non-defaulting party from its obligation to make payments on outstanding transactions to the defaulting party; (f) Guarantee Obligations of the Borrower or any Guarantor in respect of Debt otherwise permitted hereunder of the Borrower or any other Guarantor, including the Senior Notes; (g) Debt consisting of the Deferred Purchase Price of any Acquisition permitted by this Agreement; (h) Debt incurred by the Borrower under the Senior Notes and the Senior Notes Documents and any Permitted Senior Notes Refinancing in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding;450,000,000; and (iiii) in the case so long as there exists no Default before or after giving effect thereto, Debt of the Borrower and its Subsidiaries, the Permanent Debt Guarantors not otherwise permitted pursuant to clauses (a) through (h) above in an aggregate principal amount not to exceed in excess of $105,000,000; (iv) Debt owed to 50,000,000, provided that the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) Net Cash Proceeds of any Person that becomes a Subsidiary of the Borrower after the date hereof such Debt shall be applied in accordance with the terms of Section 5.022.05(b)(iii) (if applicable).

Debt. Create, incur, assume issue or suffer to existexist any Debt, or permit except any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanthe following: (i) In the case of the Borrower, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstanding; (ii) in the case of Holding, (Aa) Debt under the Loan Documents; (b) Debt outstanding on the Closing Date and listed on Schedule 6.09 and extensions, renewals and refinancings of such Debt; provided that (Bi) the amount of such Debt is not increased at the time of such extension, renewal or refinancing unless permitted by Section 8.01(f) and (ii) the terms relating to principal amount, amortization, maturity, collateral (if any) and subordination (if any), and other material terms taken as a whole, of any such refinancing, refunding, renewing or extending Debt, and of any agreement entered into and of any instrument issued in connection therewith, are no less favorable in any material respect to the Borrowers and the Restricted Subsidiaries or the Lenders than the terms of any agreement or instrument governing the Debt being refinanced, refunded, renewed or extended and the interest rate applicable to any such refinancing, refunding, renewing or extending Debt does not exceed the then applicable market interest rate; (c) Debt in an respect of, under, or consisting of Permitted Hedging Obligations; (d) Debt in respect of capital leases and purchase money obligations for fixed or capital assets; provided that the aggregate principal amount of all such Debt at any one time outstanding shall not to exceed $10,000,000 at 5,000,000 (or its equivalent in other currencies); (e) Debt incurred by any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided Loan Party that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations in the form of Holding under unsecured or junior lien subordinated debt (“Subordinated Debt”); provided that (i) immediately before and after the Loan Documents incurrence of such Subordinated Debt, (A) no Event of Default shall exist or would result therefrom and (B) the Borrowers shall be in compliance on terms a Pro Forma Basis with (1) a Consolidated Interest Coverage Ratio greater than 2.50:1.00 and conditions (y) a Consolidated Total Leverage Ratio not to exceed 5.00:1.00, and (ii) any such Subordinated Debt (A) shall be subject to Approved Subordination Terms or otherwise subject to an intercreditor or subordination agreement reasonably satisfactory to the Lender PartiesRequired Lenders, (xB) such Debt shall have a maturity date no earlier than twelve months after the Maturity Date, (C) shall not bear interest on a cash basis have any scheduled amortization payments prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Maturity Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iiiD) in the case of any junior lien Subordinated Debt, such Subordinated Debt shall not be secured by a Lien on any collateral that is not Collateral securing the Borrower Obligations under this Agreement and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02;

Debt. CreateNot, incur, assume or suffer to exist, or and not permit any of its Subsidiaries to Restricted Subsidiary to, create, incur, assume or suffer to existexist any Debt, except: (a) Obligations under this Agreement and the other Loan Documents; (b) Debt not otherwise permitted hereunder secured by Liens permitted by Section 7.2(d), and extensions, renewals and refinancings thereof; provided that the aggregate principal amount of all such Debt at any time outstanding shall not exceed $500,000; (c) Debt other than:of Borrower to any domestic Wholly-Owned Restricted Subsidiary or Debt of any domestic Wholly-Owned Restricted Subsidiary to Borrower or another domestic Wholly-Owned Restricted Subsidiary; (d) intentionally omitted; (e) Debt of Folz Acquisition Sub to Fundamental Dynamics Industries, Inc. in an xxxxegate outstanding principal amount not at any time in excess of $75,000; (f) Hedging Obligations incurred in favor of a Lender or an Affiliate thereof for bona fide hedging purposes and not for speculation; (g) Debt (including Contingent Obligations) described on Schedule 7.1 as of the Closing Date, and any extension, renewal, refunding or refinancing thereof so long as the principal amount thereof is not increased; (h) the Trust Subordinated Debt in an aggregate outstanding principal amount not at any time exceeding $17,000,000, together with all accrued and unpaid interest thereon; (i) In the case of the Borrower, Audax Subordinated Debt in an aggregate outstanding principal amount not at any time exceeding $31,500,000, plus the aggregate outstanding amount of any PIK Notes issued in connection therewith, and all accrued and unpaid interest thereon; (j) the Senarc Debt in an aggregate outstanding principal amount not at any time exceeding $223,490, together with all accrued and unpaid interest thereon; (k) Contingent Obligations arising (i) with respect to customary indemnification obligations in favor of Hedge Agreements designed to hedge against fluctuations sellers in interest rates incurred connection with Acquisitions permitted under Section 7.5 and purchasers in connection with dispositions permitted under Section 7.5(b), (ii) in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at by Borrower or any time outstanding; (ii) in the case of Holdingits Restricted Subsidiaries guaranteeing obligations of Borrower or any of its domestic Restricted Subsidiaries, (A) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case favor of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred customers in the ordinary course of business for as a result of product warranties and (iv) in connection with unfunded pension fund and other employee benefit plan obligations, to the deferred purchase price extent the same are not yet required to be funded; (l) Debt incurred in connection with Acquisitions permitted pursuant to Section 7.11(k); provided that the requirements of property or services, maturing within one year from clause (vi) of such Section are satisfied; (m) the date created, and aggregating, on a Consolidated basis, Kiddie World Debt in an aggregate outstanding principal amount not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of businessexceeding $953,051, together with all accrued and unpaid interest thereon; and (Fn) other Debt, in addition to the Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of listed above, in an aggregate outstanding principal amount not at any Person that becomes a Subsidiary time to exceed $500,000, less the aggregate outstanding principal amount of the Borrower after the date hereof Senarc Debt at such time (but in accordance with the terms of Section 5.02no event less than zero).

Debt. CreateThe Borrower will not, and will not permit any Restricted Subsidiary to, incur, create, assume or suffer to existexist any Debt, except: (a) the Notes or permit other Secured Obligations arising under the Loan Documents or any guaranty of or suretyship arrangement for the Notes or other Secured Obligations arising under the Loan Documents; (b) Debt of the Borrower and its Restricted Subsidiaries existing on the date hereof that is reflected on Schedule 9.02 and any Permitted Refinancing Debt thereof; (c) contingent obligations as a non-operator under oil and gas operating agreements and contingent obligations under gas sale contracts for make-up volumes on sales of gas, in each case incurred in the ordinary course of business; (d) (i) Debt under Capital Leases or that constitutes Purchase Money Indebtedness; provided that such Debt shall not to create, incur, assume or suffer to exist, exceed $15,000,000 in aggregate principal amount at any one time outstanding and (ii) any Permitted Refinancing Debt other than:thereof; (i) In Debt incurred to finance the case acquisition, construction or improvement of the Borrower’s corporate headquarters office building; provided that such Debt shall not to exceed $10,000,000 in aggregate principal amount at any one time outstanding and (ii) any Permitted Refinancing Debt thereof; (f) Debt associated with bonds, Debt in respect letters of Hedge Agreements designed to hedge against fluctuations in interest rates credit, surety or similar obligations incurred in the ordinary course of business and consistent with prudent business practice in connection with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstandingoperation of the Oil and Gas Properties; (iig) intercompany Debt between the Borrower and any Restricted Subsidiary or between Restricted Subsidiaries to the extent permitted by Section 9.05; provided that such Debt is not held, assigned, transferred, negotiated or pledged to any Person other than the Borrower or one of its Wholly-Owned Restricted Subsidiaries, and, provided further, that any such Debt owed by either the Borrower or a Guarantor shall be subordinated to the Secured Obligations on terms set forth in the case Guarantee and Collateral Agreement. (h) endorsements of Holding, negotiable instruments for collection in the ordinary course of business; (Ai) Permitted 0000 Xxxx Xxxx and any Permitted Refinancing Debt under thereof; (j) Permitted Unsecured Debt issued after the Loan Documents, (B) Debt Effective Date in an aggregate outstanding principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower200,000,000; and (vk) in the case of the Borrower and any of its Subsidiaries, (A) other Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed the greater of (i) $20,000,000 and (ii) 5% of the Borrowing Base in effect as of the date of incurrence in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02.

Debt. CreateNot, incur, assume or suffer to exist, or and not permit any of its Subsidiaries to other Loan Party to, create, incur, assume or suffer to existexist any Debt, any Debt other thanexcept: (ia) In Obligations under this Agreement and the case of the Borrower, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstandingother Loan Documents; (ii) in the case of Holding, (A) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (Bb) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in 11.2(d), and extensions, renewals and refinancings thereof; provided that the aggregate $10,000,000 amount of all such Debt at any time outstanding,outstanding shall not exceed $5,000,000. (Cc) Capitalized Leases not Debt of any Borrower to exceed any domestic Wholly-Owned Subsidiary or Debt of any domestic Wholly-Owned Subsidiary to any Borrower or another domestic Wholly-Owned Subsidiary; provided that such Debt shall be evidenced by a demand note in form and substance reasonably satisfactory to the Lender and pledged and delivered to the Lender pursuant to the Collateral Documents as additional collateral security for the Obligations, and the obligations under such demand note shall be subordinated to the Obligations of the Borrowers hereunder in a manner reasonably satisfactory to the Lender; (d) Westell’s obligations under the Enginuity Guarantee, provided that the aggregate principal amount of such Debt shall not exceed $20,000,000 1,620,000; (e) Hedging Obligations incurred in favor of the Lender or an Affiliate thereof for bona fide hedging purposes and not for speculation; (f) Debt described on Schedule 11.1 and any extension, renewal or refinancing thereof so long as the principal amount thereof is not increased; (g) the Debt to be Repaid (so long as such Debt is repaid on the Closing Date with the proceeds of the initial Loans hereunder); (h) Contingent Liabilities arising with respect to customary indemnification obligations in favor of purchasers in connection with dispositions permitted under Section 11.5; and (i) other unsecured Debt, in addition to the Debt listed above, in an aggregate outstanding amount not at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than exceeding $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.022,000,000.

Debt. CreateNeither the Borrower nor any Material Subsidiary will ---- incur, incurcreate, assume or suffer to existexist any Debt, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanexcept: (ia) In the case Notes or other Indebtedness arising under the Loan Documents or any guaranty of or suretyship arrangement for the Notes or other Indebtedness arising under the Loan Documents. (b) Debt of the BorrowerBorrower and its Material Subsidiaries existing on the date hereof that is reflected in the Financial Statements, and any Permitted Refinancing Debt in respect thereof. (c) accounts payable (for the deferred purchase price of Hedge Agreements designed Property or services) from time to hedge against fluctuations in interest rates time incurred in the ordinary course of business which are not greater than sixty (60) days past the date of invoice or delinquent or which are being contested in good faith by appropriate action and consistent for which adequate reserves have been maintained in accordance with prudent business practice with the aggregate Agreement Value thereof GAAP. (d) Debt under Capital Leases not to exceed $2,500,000 at any time outstanding;5,000,000. (ii) in the case of Holding, (Ae) Debt under associated with bonds or surety obligations required by Governmental Requirements in connection with the Loan Documents, operation of the Oil and Gas Properties. (Bf) intercompany Debt in an aggregate principal amount not to exceed $10,000,000 at between the Borrower and any time issued pursuant Material Subsidiary or between Material Subsidiaries to the Stockholders Agreement or an Employment Agreement extent permitted by Section 9.05(g); provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior held, assigned, transferred, negotiated or pledged to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of Person other than the Borrower or one of its Wholly-Owned Subsidiaries, and, provided further, that any such Debt owed to a wholly-owned Subsidiary of the Borrower by either the Borrower or any other wholly-owned Subsidiary of a Guarantor shall be subordinated to the Borrower; andIndebtedness on terms set forth in the Guaranty Agreement. (vg) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement endorsements of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and. (Fh) non-recourse Debt (secured by Property other than Oil and Gas Properties evaluated by the Lenders for purposes of establishing the Borrowing Base not to exceed $10,000,000 in the aggregate at any one time outstanding. (i) other Debt comprised of senior bank financing or other similar working capital financing) of not to exceed $5,000,000 in the aggregate at any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02one time outstanding.

Debt. CreateNot, incur, assume or suffer to exist, or and not permit any of its Subsidiaries to other Loan Party to, create, incur, assume or suffer to existexist any Debt, any Debt other thanexcept: (ia) In Obligations under this Agreement and the case other Loan Documents; (b) Debt secured by Liens permitted by Sections 11.2(d) and 11.2(h), and extensions, renewals and refinancings thereof; provided that the aggregate amount of all such Debt at any time outstanding shall not exceed $25,000,000; (c) Debt of the BorrowerCompany to any domestic Wholly-Owned Subsidiary or Debt of any domestic Wholly-Owned Subsidiary to the Company or another domestic Wholly-Owned Subsidiary; provided that such Debt shall be evidenced by a demand note in form and substance reasonably satisfactory to the Administrative Agent and pledged and delivered to the Administrative Agent pursuant to the Collateral Documents as additional collateral security for the Obligations, Debt and the obligations under such demand note shall be subordinated to the Obligations of the Company hereunder in respect of Hedge Agreements designed a manner reasonably satisfactory to hedge against fluctuations in interest rates the Administrative Agent; (d) Subordinated Debt; (e) Hedging Obligations approved by Administrative Agent and incurred in favor of a Lender or an Affiliate thereof for bona fide hedging purposes and not for speculation; (f) Debt described on Schedule 11.1 and any extension, renewal or refinancing thereof so long as the ordinary course of business and consistent with prudent business practice principal amount thereof is not increased; (g) the Debt to be Repaid (so long as such Debt is repaid on the Closing Date with the aggregate Agreement Value thereof proceeds of the initial Loans hereunder); (h) the maximum amount of secured obligations at any one time outstanding under and pursuant to the Factoring Facility, not to exceed $2,500,000 30,000,000 in the aggregate, at any one time outstanding; (ii) in the case of Holding, (Ai) Debt assumed in connection with Acquisitions permitted under the Loan Documents, (B) Debt in an aggregate principal amount Section 11.5 not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holdingoutstanding; (iiij) Debt consisting of seller financing incurred in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount connection with Acquisitions permitted under Section 11.5 not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding,; and (Ck) Capitalized Leases other unsecured Debt, in addition to the Debt listed above, in an aggregate outstanding amount not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than exceeding $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.0220,000,000.

Debt. Create, incur, assume or suffer to exist, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanDebt, except: (i) In in the case of the Borrower, , (A) Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates or foreign exchange rates, and not for speculative purposes, incurred in the ordinary course of business and consistent with prudent business practice with practice, and (B) Debt owed to a wholly owned Subsidiary of the aggregate Agreement Value thereof not Borrower, which Debt (x) shall be on subordinated terms reasonably acceptable to exceed $2,500,000 at any time outstanding;the Administrative Agent and (y) shall be evidenced by promissory notes in form and substance reasonably satisfactory to the Administrative Agent. (ii) in the case of Holdingany Subsidiary of the Borrower, (A) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant owed to the Stockholders Agreement Borrower or an Employment Agreement to a wholly owned Subsidiary of the Borrower, provided that (w) that, in each case, such Debt is (x) shall be on terms reasonably acceptable to the Administrative Agent and (y) shall be evidenced by a promissory note notes in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions substance reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding;Administrative Agent; and (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan DocumentsDocuments (which, in the case of Secured Hedge Agreements, should be consistent with the terms of Section 5.02(b)(i)(A)), (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 30,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 50,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date createdSurviving Debt, and aggregatingany Debt extending the maturity of, on a Consolidated basisor refunding or refinancing, not more than $7,500,000 at in whole or in part, any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions Surviving Debt and any Debt in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary respect of the Borrower after Senior Subordinated Notes or the date hereof in accordance with 2007 Senior Notes, provided that the terms of Section 5.02any such extending, refunding or refinancing Debt, and of any agreement entered into and of any instrument issued in connection therewith, are not otherwise prohibited by the Loan Documents, provided further that the principal amount of such Surviving Debt or Debt in respect of the Senior Subordinated Notes or the 2007 Senior Notes shall not be increased above the principal amount thereof outstanding immediately prior to such extension, refunding or refinancing, and the direct and contingent obligors therefor shall not be changed, as a result of or in connection with such extension, refunding or refinancing, provided still further that the terms relating to principal amount, amortization, maturity, collateral (if any) and subordination (if any), and other material terms taken as a whole, of any such extending, refunding or refinancing Debt, and of any agreement entered into and of any instrument issued in connection therewith, are no less favorable in any material respect to the Loan Parties or the Lender Parties than the terms of any agreement or instrument governing the Debt being extended, refunded or refinanced and the interest rate applicable to any such extending, refunding or refinancing Debt does not exceed the then applicable market interest rate,

Debt. CreateNot, incur, assume or and not suffer to exist, or permit any of its Subsidiaries to Loan Party or any other Subsidiary, to, create, incur, assume or suffer to existexist any Debt, any Debt other thanexcept for the following: (ia) In Obligations under this Agreement and the case of the Borrower, other Loan Documents; (b) Debt in respect of Hedge Agreements designed Capital Leases and purchase money Debt, in each case incurred for the purpose of financing all or any part of the cost of acquiring, repair, construction or improvement of fixed or capital assets; provided that the aggregate principal amount of all such Debt at any time outstanding shall not exceed $250,000; (c) Debt of Parent to hedge any Loan Party that is a Wholly-Owned Subsidiary of Parent or Debt of any Loan Party that is a Wholly-Owned Subsidiary of Parent to Parent or another Loan Party that is a Wholly-Owned Subsidiary of Parent; (d) Debt described in Section 7.1 of the Disclosure Letter as of the Closing Date, and any Permitted Refinancing thereof; (e) Contingent Obligations arising with respect to customary indemnification obligations in favor of purchasers in connection with dispositions permitted under Section 7.4; (f) Debt arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against fluctuations in interest rates incurred insufficient funds in the ordinary course of business and consistent with prudent business practice business, provided that such Debt is extinguished within 2 Business Days of notice to Parent or the relevant Subsidiary of its incurrence; (g) Debt incurred in connection with the aggregate financing of insurance premiums in the ordinary course of business; (h) Unsecured Debt owing to Pfizer arising out of or in connection with that certain Stock Purchase Agreement Value thereof between Pfizer and Parent dated as of December 11, 2009 not to exceed the aggregate principal amount of $2,500,000 at any time outstanding25,000,000, plus accrued or capitalized interest thereon; provided that no payments on account of such Debt may be made during the term of this Agreement without the Agent’s prior written consent, which may be withheld in Agent’s sole discretion; (iii) Debt in connection with Parent’s obligations under the Assistance Agreement with respect to a grant to Parent in the amount of $2,250,000; (j) guaranties by the Borrower of the Debt of any Loan Party that is a Wholly-Owned Subsidiary of Parent or guaranties by any Subsidiary thereof of the Debt of the Borrower in each case of Holdingso long as such Debt is otherwise permitted under this Section 7.1(a), (A) Debt under the Loan Documentsb), (Be), (k) or (o); (k) Subordinated Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding5,000,000; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (Dl) unsecured Debt to trade creditors incurred in the ordinary course of business business; (m) reimbursement obligations under corporate credit cards not to exceed $250,000 in the aggregate at any time; (n) reimbursement obligations with respect to letters of credit for the deferred purchase price account of property or services, maturing within one year from lessors not to exceed $2,000,000 in the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 aggregate at any one time; (o) other Debt in an amount not to exceed $100,000 in the aggregate at any time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, ; and (Fp) Debt (incurred in connection with interest rate, foreign currency and other than Debt comprised of senior bank financing or other similar working capital financing) of any Person swap arrangements that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02are entered into to mitigate risk and not for speculative purposes.

Debt. CreateNeither the Borrower nor any Material Subsidiary will incur, incurcreate, assume or suffer to existexist any Debt, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanexcept: (ia) In the case Notes or other Indebtedness arising under the Loan Documents or any guaranty of or suretyship arrangement for the Notes or other Indebtedness arising under the Loan Documents. (b) Debt of the BorrowerBorrower and its Material Subsidiaries existing on the date hereof that is reflected in the Financial Statements, and any Permitted Refinancing Debt in respect thereof. (c) accounts payable (for the deferred purchase price of Hedge Agreements designed Property or services) from time to hedge against fluctuations in interest rates time incurred in the ordinary course of business which are not greater than sixty (60) days past the date of invoice or delinquent or which are being contested in good faith by appropriate action and consistent for which adequate reserves have been maintained in accordance with prudent business practice with the aggregate Agreement Value thereof GAAP. (d) Debt under Capital Leases not to exceed $2,500,000 at any time outstanding;15,000,000. (ii) in the case of Holding, (Ae) Debt under associated with bonds or surety obligations required by Governmental Requirements in connection with the Loan Documents, operation of the Oil and Gas Properties. (Bf) intercompany Debt in an aggregate principal amount not to exceed $10,000,000 at between the Borrower and any time issued pursuant Material Subsidiary or between Material Subsidiaries to the Stockholders Agreement or an Employment Agreement extent permitted by Section 9.05(g); provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior held, assigned, transferred, negotiated or pledged to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of Person other than the Borrower or one of its Wholly-Owned Subsidiaries, and, provided further, that any such Debt owed to a wholly-owned Subsidiary of the Borrower by either the Borrower or any other wholly-owned Subsidiary of a Guarantor shall be subordinated to the Borrower; andIndebtedness on terms set forth in the Guaranty Agreement. (vg) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement endorsements of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and. (Fh) non-recourse Debt secured by Property other than Oil and Gas Properties evaluated by the Lenders for purposes of establishing the Borrowing Base not to exceed $25,000,000 in the aggregate at any one time outstanding. (i) other Debt not to exceed $15,000,000 in the aggregate at any one time outstanding. (j) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower evidenced by the Senior Convertible Notes, together with any and all refinancings thereof, so long as all of same are either unsecured or expressly subordinated to this Agreement and all of same are scheduled to mature after the date hereof in accordance with the terms of Section 5.02Maturity Date under this Agreement.

Debt. CreateThe Company shall not, incurand shall not permit any Subsidiary to, assume become or suffer to existremain obligated for any indebtedness for borrowed money, or permit for any indebtedness incurred in connection with the acquisition of its Subsidiaries to createany property, incurreal or personal, assume tangible or suffer to existintangible, any Debt other thanexcept: (ia) In indebtedness to the case of the Borrower, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstandingPurchasers; (iib) indebtedness to the Lenders under the Credit Agreement in the case of Holding, (A) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that sum of (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (yi) the final maturity product of such (A) $25,000,000 of term Debt minus the sum of all scheduled principal payments (scheduled as of the date the Credit Agreement is after entered into by the Termination Date and parties thereto) multiplied by (zB) amortization 1.30, plus (ii) the product of such (A) $12,000,000 of revolving Debt is not required prior to the Termination Date, and multiplied by (CB) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding1.30; (iiic) current unsecured trade payables and accrued liabilities arising in the case ordinary course of the Borrower Company's or any Subsidiary's business, deferred income tax and its Subsidiaries, purchase accounting reserves; (d) purchase money indebtedness for the Permanent Debt acquisition of fixed assets in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed 500,000 in the aggregate during any fiscal year of the Company (determined on a combined basis for the Company and its Subsidiaries). (e) existing indebtedness listed in attached Schedule 9.04. (f) unsecured indebtedness of the Company to its wholly owned Material Subsidiaries or a wholly owned Material Subsidiary to another wholly owned Material Subsidiary or a wholly owned Material Subsidiary to the Company. (g) other unsecured indebtedness not exceeding $10,000,000 100,000 in the aggregate at any time outstanding,. (Ch) Capitalized Leases indebtedness under any Interest Rate Protection Agreements. (i) unsecured indebtedness of Densitron Microwave Limited or DML Microwave Limited under an overdraft line of credit in an amount not to exceed exceeding 500,000 Pounds Sterling in the aggregate $20,000,000 at any time outstanding,. (Dj) unsecured Debt indebtedness of DML Microwave Limited to MCE Europe, Inc. in an amount not exceeding 3,000,000 Pounds Sterling incurred to consummate the Acquisition and until June 30, 2000 unsecured indebtedness of Densitron Microwave Limited to MCE Europe, Inc. in the ordinary course of business an amount not to exceed 2,000,000 Pounds Sterling incurred for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02purposes.

Debt. CreateThe Borrower will not, incurand will not permit any Subsidiary to, assume or suffer to exist, incur or permit to exist any Debt, except: (a) Debt evidenced by the Notes, the Facility Letter of Credit Obligations or outstanding under the Term Loan Facility and any Equity-Preferred Securities (to the extent the same constitutes Debt) not in default, as well as (i) Debt of Panhandle Eastern and/or any of its Subsidiaries outstanding as of the Closing Date, (ii) any Panhandle Eastern Refinancing Debt, (iii) any loans or advances by the Borrower to create, incur, assume or suffer to exist, Panhandle Eastern and/or any Debt other than: (i) In the case of the Borrower's other Subsidiaries permitted under Section 10.4(b) and (iv) any working capital credit facility or facilities provided directly to Panhandle Eastern and/or any of Panhandle Eastern's Subsidiaries by any party other than the Borrower, so long as the principal amount of all such outstanding working capital facilities, together with the outstanding principal amount of any working capital loans or advances by the Borrower to Panhandle Eastern and/or any of Panhandle Eastern's Subsidiaries, does not exceed (A) $50,000,000 in the aggregate at any time that the ratio of Consolidated Total Indebtedness to Consolidated Total Capitalization for Panhandle Eastern and Panhandle Eastern's Subsidiaries (excluding the Borrower and all other Subsidiaries of the Borrower for purposes of such calculation) is greater 0.65 to 1.00 and (B) $75,000,000 in the aggregate at any time that the ratio of Consolidated Total Indebtedness to Consolidated Total Capitalization for Panhandle Eastern and Panhandle Eastern's Subsidiaries (excluding the Borrower and all other Subsidiaries of the Borrower for purposes of such calculation) is less than or equal to 0.65 to 1.00; (b) Debt in respect of Hedge Agreements designed any Subsidiary to hedge against fluctuations in interest rates incurred the Borrower or any other Subsidiary, except to the extent limited by the terms of Section 10.4(b), and Debt of the Borrower to any Subsidiary; (c) Debt existing as of December 31, 2003 as reflected on financial statements delivered under Section 7.2(b) and refinancings thereof other than Debt that has been refinanced by the proceeds of Loans; (d) endorsements in the ordinary course of business and consistent with prudent business practice with of negotiable instruments in the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstandingcourse of collection; (e) Debt of the Borrower or any Subsidiary representing the portion of the purchase price of property acquired by the Borrower or such Subsidiary that is secured by Liens permitted by the provisions of Section 10.2(d); provided, however, that at no time may the aggregate principal amount of such Debt outstanding exceed thirty percent (30%) of the Consolidated Net Worth of the Borrower and its Subsidiaries as of the applicable determination date; (f) Debt evidenced by Senior Notes; (g) additional Debt of the Borrower and Structured Securities of the Borrower and the Southern Union Trusts provided that after giving effect to the issuance thereof, there shall exist no Default or Event of Default; and: (i) the ratio of Consolidated Total Indebtedness to Consolidated Total Capitalization shall be no greater than 0.65 to 1.00 at all times; (ii) the ratio of EBDIT for the four fiscal quarters most recently ended to pro forma Cash Interest Expense for the following four fiscal quarters shall be no less than 2.00 to 1.0 at all times; provided, however, that if the additional Debt for which the determinations required to be made by this subparagraph (g) will be used to finance in whole or in part the case consideration to be paid by the Borrower for the acquisition of Holdingany entity otherwise permitted under the terms of this Agreement, the determination of EBDIT for purposes of this ratio shall include not only the EBDIT of the Borrower and its Subsidiaries for the four fiscal quarters most recently ended, but shall also include the EBDIT of such entity to be acquired for such four fiscal quarters most recently ended; and (iii) (A) such Debt under and Structured Securities shall have a final maturity or mandatory redemption date, as the Loan Documentscase may be, no earlier than the Maturity Date and shall mature or be subject to mandatory redemption or mandatory defeasance no earlier than the Maturity Date (as so extended) and shall be subject to no mandatory redemption or "put" to the Borrower or any Southern Union Trust exercisable, or sinking fund or other similar mandatory principal payment provisions that require payments to be made toward principal, prior to such Maturity Date (as so extended); or (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such additional Debt shall not bear interest on have a cash basis final maturity date prior to the Termination Maturity Date, (y) such additional Debt shall not exceed Two Hundred Fifty Million Dollars ($250,000,000.00) in the final maturity aggregate plus Twenty Million Dollars ($20,000,000.00) of reimbursement obligations incurred in connection with Non-Facility Letters of Credit issued by a Bank or Banks or by any other financial institution; provided, however, that for purposes of determining the aggregate amount of such additional Debt is after for purposes of this subclause (y), the Termination Date Debt of the Borrower under the Term Loan Facility shall not be included and such Debt under the Term Loan Facility shall be deemed to be permitted Debt for purposes of this subclause (y), and (z) amortization such additional Debt shall be borrowed from a Bank or Banks as a loan or loans arising independent of this Agreement or the Term Loan Facility or shall be borrowed from a financial institution that is not a Bank under this Agreement or the Term Loan Facility; and (h) additional Debt of Trunkline LNG Holdings or any of its Subsidiaries, so long as (i) such Debt is to Trunkline LNG Holdings and/or any of its Subsidiaries only and is not required prior recourse in any respect to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower (other than Panhandle Eastern and its Subsidiaries), (ii) the proceeds of such Debt is used solely to finance capital expenditures of Trunkline LNG Holdings and/or its Subsidiaries, and (iii) after the date hereof in accordance with the terms giving effect to such Debt, no Default or Event of Section 5.02Default shall exist.

Debt. Create, incur, assume or suffer to exist, or permit any of ---- its Subsidiaries to create, incur, assume or suffer to exist, any Debt other than: (i) In in the case of the Borrower, (A) Debt owed to its Subsidiaries; so long as at the time of incurrence of such Debt, foreclosure proceedings shall not have been commenced with respect to any stock or assets of such Subsidiaries, (B) Debt in respect of Hedge Agreements not entered into for speculative purposes and designed to hedge against fluctuations in interest rates or foreign exchange rates incurred in the ordinary course of business and consistent with prudent business practice with practice, and (C) Debt in respect of guarantees by the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstanding;Borrower of the Obligations of Foreign Subsidiaries under bank overdraft facilities permitted under Section 5.02(b)(iii)(I), (ii) in the case of Holding, (A) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-or to a wholly owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrowerextent permitted under Section 5.02(f); and (viii) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases in an aggregate amount, calculated in accordance with GAAP, not to exceed in the aggregate $20,000,000 10,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date createdSurviving Debt, and aggregatingany Debt extending the maturity of, on or refunding or refinancing, in whole or in part, any Surviving Debt, provided that the terms of any such -------- extending, refunding or refinancing Debt, and of any agreement entered into and of any instrument issued in connection therewith, are otherwise permitted by the Loan Documents and provided further that the principal amount of such Surviving Debt -------- ------ shall not be increased above the principal amount thereof outstanding immediately prior to such extension, refunding or refinancing, and the direct and contingent obligors therefor shall not be changed, as a Consolidated basisresult of or in connection with such extension, refunding or refinancing, (E) Subordinated Debt under the Subordinated Notes Indentures, (F) Debt of any Person that becomes a Subsidiary of the Borrower after the First Closing Date in accordance with the terms of Section 5.02(f) that is existing at the time such Person becomes a Subsidiary of the Borrower, (G) Debt in an aggregate principal amount not more than to exceed $7,500,000 5,000,000 outstanding at any one time and consisting of letters of credit (other than Letters of Credit issued hereunder) and reimbursement obligations in respect thereof, (H) other Debt in an aggregate amount not to exceed $5,000,000 at any time outstanding, (EI) in the case of Foreign Subsidiaries, Debt under bank overdraft facilities in an aggregate amount not to exceed $10,000,000 at any time outstanding, (J) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (FK) Debt (other than Debt comprised consisting of senior bank repurchase arrangements in connection with the financing or other similar working capital financing) of any Person that becomes a Subsidiary of bowling equipment sales by the Borrower after the date hereof in accordance with the terms of Section 5.02and its Subsidiaries.

Debt. Create, incur, assume or suffer permit to exist, or permit any of its Subsidiaries Subsidiary to create, incur, assume or suffer permit to exist, any Debt other than: indebtedness or liabilities resulting from borrowings, loans or advances, whether matured or unmatured, liquidated or unliquidated, joint or several, secured or unsecured, except for (i) In Debt incurred pursuant to the case of the Borrower, Debt Convertible Debentures in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof a principal amount not to exceed $2,500,000 20,000,000 outstanding at any time, (ii) secured indebtedness for purchase money financing of equipment which is permitted under Section 6.02(d)(iii) in a principal amount not to exceed an aggregate of $2,000,000 outstanding at any time, (iii) other secured Debt identified on Schedule 6.02(e) not to exceed the applicable amount indicated on such schedule, (iv) unsecured senior funded bank debt in a principal amount not to exceed $30,000,000 outstanding at any time outstanding; (ii) in the case aggregate for the Borrower and its Subsidiaries (including, without limitation, unsecured senior funded bank debt incurred pursuant to the Loan Documents and the Union Loan Documents, and excluding the undrawn face amount of Holding, the Capistrano Letter of Credit); provided that (A) Debt the principal amount outstanding under the credit facility provided to Suburban pursuant to the Suburban Loan DocumentsDocuments shall not exceed $0 at any time, and (B) Debt the only unsecured senior funded debt of the Subsidiaries which may be outstanding shall be (I) unsecured bank indebtedness of NMUI in an aggregate principal amount not to exceed $10,000,000 at any one time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date $4,000,000 and (zII) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) other unsecured senior funded debt in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate a principal amount not to exceed $105,000,000; (iv) Debt owed to 500,000 outstanding at any time in the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and aggregate for all Subsidiaries, and (v) in the case of the intercompany Debt between Borrower and any of its majority-owned Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to . In no event shall funded debt at Suburban exceed in the aggregate $10,000,000 Suburban’s bondable capacity at any time outstanding, (C) Capitalized Leases not time, and any and all mortgage bonds issued by Suburban and/or NMUI subsequent to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit this Agreement shall have an NAIC rating of “1” or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02“2”.

Debt. Create, incur, assume or suffer to exist, or permit any of its Subsidiaries to create, incur, assume or suffer to existexist any Debt, any Debt other thanexcept: (ia) In Debt of each Borrower and the case Parent under this Agreement, the other Facility Documents and the Other Credit Agreement; (b) Debt described in Schedule IV (including the Prudential Shelf Notes), including renewals, extensions or refinancings thereof (and including refinancings by institutions other than those institutions identified on Schedule IV), provided that the principal amount thereof does not increase; (c) Debt of the BorrowerParent subordinated (on terms satisfactory to the Administrative Agent and the Required Lenders) to the Parent's obligations under this Agreement and the other Facility Documents; (d) Debt of the Parent to any Subsidiary; and Debt of any Subsidiary to the Parent or to another Subsidiary, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with provided that the aggregate Agreement Value thereof not to exceed $2,500,000 amount at any time outstandingoutstanding of all Debt of Subsidiaries to the Parent or to other Subsidiaries does not exceed 20% of the Consolidated Tangible Net Worth at the time of determination; (iie) in the case Debt consisting of Holdingleases permitted under Section 7.4 or of guaranties permitted under subsections (a), (A) Debt under the Loan Documentsb), (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Partiesc), (xd) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (zg) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by HoldingSection 7.2; (iiif) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the BorrowerFuture Permitted Private Placement Debt; and (vg) in the case other Debt of the Borrower and Parent or any Subsidiary of its Subsidiaries, the Parent, provided that (Ai) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 amount of such Debt outstanding at any time outstanding, shall not exceed $25,000,000 (Cas to all of the Parent and its Subsidiaries) Capitalized Leases not to exceed in and (ii) the aggregate $20,000,000 amount of liability in respect of letters of credit (excluding Letters of Credit issued under the Other Credit Agreement) outstanding at any time outstanding, shall not exceed $10,000,000 (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary as to all of the Borrower after Parent and its Subsidiaries) (which liability shall include liability for outstanding letters of credit that have not been drawn upon, as well as outstanding reimbursement obligations as to letters of credit that have been drawn upon; and which $10,000,000 limitation shall be inclusive of the date hereof letters of credit identified in accordance with the terms of Section 5.02Schedule IV and renewals and extensions thereof).

Debt. Create, incur, assume or suffer to existexist any Debt, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanexcept: (ia) In The Obligations; (b) Debt described in Schedule 7.10 hereto, and any renewals, extensions or refinancings thereof provided, that such renewals, extensions or refinancings are on terms no less favorable to the case Borrower or the relevant Subsidiary of the BorrowerBorrower than the original terms of such Debt; (c) Subordinated Debt; (d) Debt incurred in connection with operating leases entered into by the Borrower or its Subsidiaries, or any of them, consistent with past practice or in the ordinary course of business; (e) Debt of the Borrower or its Subsidiaries, or any of them, secured by Permitted Liens; (f) Current liabilities in respect of Hedge Agreements designed to hedge against fluctuations in interest rates taxes, assessments and governmental charges and levies incurred, or claims for labor, materials, inventory, services, supplies and rentals incurred, or for goods or services purchased, incurred in the ordinary course of business and consistent with prudent business practice with business; (g) Capital Leases, provided that the aggregate Agreement Value thereof initial present value of such Capital Leases does not to exceed $2,500,000 at in any time outstandingfiscal year; (ii) in the case of Holding, (Ah) Debt under of the Loan DocumentsBorrower to any Subsidiary of the Borrower, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at or of any time issued pursuant Subsidiary of the Borrower to the Stockholders Agreement Borrower or an Employment Agreement provided that any other Subsidiary of the Borrower; (wi) Permitted Assumed Acquisition Debt, but only so long as such Debt is evidenced remains Permitted Assumed Acquisition Debt; (j) Additional unsecured Debt not contemplated by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Partiesclauses (a) through (i) above, so long as (xi) such Debt shall not bear interest on a cash basis prior to exceed $40,000,000 in the Termination Date, aggregate for the Borrower and all Subsidiaries of the Borrower at any one time outstanding and (yii) the final maturity of such Debt is after the Termination Date under terms and (z) amortization of such Debt is not required prior conditions satisfactory to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the BorrowerAdministrative Agent; and (vk) in Interest Rate Protection Arrangements reasonably satisfactory to the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02Administrative Agent.

Debt. Create(a) The Borrower's Consolidated Debt will at no time exceed the Debt Limit; provided that if a Debt Limit Excession exists solely by reason of a reduction of the Debt Limit pursuant to a redetermination under subsection (b)(ii) below, incur, assume no Default will arise hereunder until 180 days following the date of such redetermination (during which time the Borrower or suffer any Subsidiary may reduce Debt or acquire additional Petroleum Properties so as to exist, or permit any restore compliance hereunder; provided further that the Debt Limit Excession shall be reduced by an amount equal to 50% of its Subsidiaries to create, incur, assume or suffer to exist, any such Debt other thanLimit Excession no later than 90 days following such redetermination). (b) The Debt Limit will be determined and adjusted periodically as follows: (i) In Prior to a determination pursuant to subsection (b)(ii) below on the case basis of the Reserve Report delivered as of December 31, 1995, and subject to adjustment in accordance with subsections (b)(iii) and (b)(iv) below, the Debt Limit shall be $315,000,000. (ii) The Agent will determine a proposed Debt limit in accordance with its customary oil and gas lending practices (A) within 60 days of delivery of each Reserve Report pursuant to Section 5.09, commencing January 1, 1996 or (B) at any time if the Required Banks so elect by notice to the Borrower and the Agent and, in either such case, notify such proposed Debt Limit to each of the other Banks. Unless the Banks having more than 33 1/3% of the aggregate amount of Commitments then in effect (or, if the Commitments have been terminated, holding Notes evidencing more than 33 1/3% of the aggregate principal amount of the Loans then outstanding) notify the Borrower and Agent that they disapprove such proposed Debt Limit within 30 days of notice by the Agent as aforesaid, such Debt Limit shall become effective on such 30th day. If the Debt Limit is so disapproved, then the Banks shall consult with one another to determine a Debt Limit acceptable to the Required Banks. The Debt Limit so determined by the Required Banks shall be promptly notified in writing by the Agent to the Borrower, Debt in respect and upon such notification shall be binding on all parties. (iii) Upon any sale by the Borrower or any Subsidiary of Hedge Agreements designed to hedge against fluctuations in interest rates incurred any Petroleum Property (other than (i) the sale of hydrocarbons after severance occurring in the ordinary course of the Borrower's business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstanding; as presently conducted, (ii) in the case sale of Holding, (A) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued Petroleum Property pursuant to the Stockholders Agreement Section 29 Transaction or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) the sale of the Section 29 Transaction PPIs by reason of the rescission of the Section 29 Transaction) or any direct or indirect transfer or other disposition to any third party of a direct or indirect interest in any Subsidiary whose assets were included in the case most recent determination of the Borrower and its SubsidiariesDebt Limit, the Permanent Debt Limit shall be reduced, effective on the date of consummation of the sale of such Petroleum Property or transfer of such interest in such Subsidiary, by an amount equal to 60% of the net proceeds of or consideration for (whether received in cash or otherwise) such sale or transfer; provided that no such reduction shall be required with respect to aggregate principal amount not net sales proceeds or consideration received of up to exceed $105,000,000;10,000,000 in any calendar year; and provided, further, that all such sales of Petroleum Properties and transfers of interests in Subsidiaries are subject to the provisions of Sections 5.12 and 5.15. (iv) If the Debt owed Limit shall have been reduced pursuant to subsection (b)(ii) or (b)(iii) above, then prior to the Borrower by any wholly-owned Subsidiary next redetermination of the Debt Limit pursuant to subsection (b)(ii) above, and immediately upon notification by the Borrower or Debt owed to a wholly-owned Subsidiary the Agent of the Borrower development by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) any Proved Reserves and other assets consisting primarily of gas gathering and transmission pipelines located in the case United States of America or in Canada owned directly by the Borrower or any Subsidiary and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed reflected in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02most recent Reserve

Debt. Create, incur, assume (i) Create or suffer to existexist any Debt if, immediately after giving effect to such Debt and the receipt and application of any proceeds thereof, the aggregate amount of Debt of the Borrower and its consolidated Subsidiaries, on a consolidated basis, would exceed (A) for the period from the Closing Date through the date eighteen months thereafter, 75%, and (B) at anytime thereafter, 65%, of the sum of the total consolidated stockholders' equity of the Borrower and its Subsidiaries as shown on the most recent consolidated balance sheet required to be delivered to the Banks pursuant to Section 5.01(b), and the aggregate amount of Debt of the Borrower and its consolidated Subsidiaries, on a consolidated basis (it being understood that for purposes of determining compliance with this covenant, guarantees by the Borrower of up to $200,000,000 of Debt of OCI Wyoming shall not constitute Debt of the Borrower); (ii) not permit the Acquisition Subsidiary, Norcen or any of their respective Subsidiaries (collectively, the "Designated Subsidiaries") to incur any Debt which would result in the aggregate principal amount of Debt (other than Debt to the Borrower or any other Subsidiary) of all the Designated Subsidiaries, on a consolidated basis, exceeding US$1,400,000,000; provided that the amount of Debt permitted by this clause (ii) is subject to reduction as provided in clause (d)(iv) of the definition of "Prepayment Event"; and (iii) not permit any of its Subsidiaries (other than the Designated Subsidiaries) to create, incur, assume or suffer to exist, incur any Debt other than: (i) In the case of the Borrower, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred which would result in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstanding; (ii) in the case of Holding, (A) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not of Debt (other than Debt to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary Subsidiary) of all Subsidiaries (other than the Borrower; and (v) in the case of the Borrower and any of its Designated Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating), on a Consolidated consolidated basis, not more than $7,500,000 at any one time outstanding, exceeding US$150,000,000; provided that the amount of Debt permitted by this clause (Eiii) indorsement of negotiable instruments for deposit or collection or similar transactions is subject to reduction as provided in the ordinary course of business, and clause (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financingd)(iv) of any Person that becomes a Subsidiary the definition of the Borrower after the date hereof in accordance with the terms of Section 5.02"Prepayment Event".

Debt. CreateThe Borrower will not, and will not permit any Subsidiary to, incur, create, assume or suffer to existexist any Debt, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanexcept: (ia) In the case Loans and other Indebtedness arising under the Loan Documents, or any guarantee of or suretyship arrangement for the Loans and other Indebtedness arising under the Loan Documents; (b) Debt of the BorrowerBorrower and its Subsidiaries existing on the date hereof that is reflected on Schedule 9.02; (c) accounts payable and accrued expenses, Debt in respect liabilities or other obligations to pay the deferred purchase price of Hedge Agreements designed Property or services, from time to hedge against fluctuations in interest rates time incurred in the ordinary course of business which are not greater than 120 days past the date of invoice or which are being contested in good faith by appropriate action and consistent for which adequate reserves have been maintained in accordance with prudent business practice with the aggregate Agreement Value thereof GAAP; (d) Debt under Capital Leases not to exceed $2,500,000 250,000 in the aggregate at any one time outstanding; (ii) in the case of Holding, (Ae) Debt under associated with bonds or surety obligations required by Governmental Requirements in connection with the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to operation of the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms Oil and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by HoldingGas Properties; (iiif) in the case of the Borrower and its Subsidiaries, the Permanent intercompany Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of between the Borrower and any of its Subsidiaries, (A) Debt under Guarantor or between Guarantors to the Loan Documents, (B) Debt secured by Liens extent permitted by Section 5.02(a)(iv) not 9.05(g); provided that any such Debt owed by either the Borrower or a Guarantor shall be subordinated to exceed the Indebtedness on the terms set forth in the aggregate $10,000,000 at any time outstanding,Guarantee and Collateral Agreement; (Cg) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement endorsements of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, ; (h) other unsecured Debt not to exceed $500,000 in the aggregate at any one time outstanding; and (Fi) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after as a result of the date hereof in accordance with Management Incentive Units constituting Disqualified Capital Stock so long as no holder of any Management Incentive Units has a right to require the terms of Section 5.02Borrower to redeem any Management Incentive Units prior to May 7, 2020.

Debt. Create, incur, assume or suffer to exist, or permit any of its Restricted Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanDebt, except: (i) In in the case of the Borrower, Debt owed to a Wholly Owned Restricted Subsidiary of the Borrower, and (ii) in the case of any Restricted Subsidiary of the Borrower, Debt owed to the Borrower or to a Wholly Owned Restricted Subsidiary of the Borrower; and (iii) in the case of the Borrower and its Restricted Subsidiaries, (A) Debt under the Loan Documents, (B) the Surviving Debt, (C) Debt under the Note Purchase Agreement evidenced by the Senior Notes in a principal amount not to exceed $180,000,000 plus, to the extent not otherwise utilized pursuant to clause (H) of this Section 5.02(b)(iii), an additional $10,000,000, (D) non-recourse Debt of the Borrower and Restricted Subsidiaries incurred solely to finance Capital Expenditures for the development of Greenfield Projects, (E) non-recourse Debt secured by Liens permitted by Section 5.02(a)(v), (F) Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates Swaps incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value value thereof not to exceed $2,500,000 at any time outstanding; (ii) in the case of Holding, (A) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to outstanding, and (G) any Debt extending the Stockholders Agreement maturity of, or an Employment Agreement refunding or refinancing, in whole or in part, any Surviving Debt or other Debt permitted under this Section 5.02(b), provided that (w) such Debt is evidenced by a promissory note in substantially the form principal amount of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis be increased above the principal amount thereof outstanding immediately prior to the Termination Datesuch extension, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Daterefunding or refinancing, and the direct and contingent obligors therefor shall not be changed, as a result of or in connection with such extension, refunding or refinancing, provided further that the terms relating to principal amount, amortization, maturity, collateral (Cif any) Debt under and subordination (if any), and other material terms taken as a whole, of any such extending, refunding or refinancing Debt, and of any agreement entered into and of any instrument issued in connection therewith, are consistent with prudent business practice and incurred in the 13% Subordinated Notes due May 31ordinary course of business and, 2009 issued by Holding; (iii) in the case of the Borrower and its SubsidiariesSenior Notes, are on terms no less favorable in any material respect to the Permanent Debt in an aggregate principal amount not to exceed $105,000,000;Loan Alliance Credit Agreement 76 76 Parties or the Lender Parties than the terms of the Senior Notes being extended, refunded or refinanced. (ivH) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, Capital Lease Obligations aggregating not more than $7,500,000 10,000,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (outstanding other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary Contingent Obligations of the Borrower after or any Restricted Subsidiary with respect to any Debt or other obligation of any Unrestricted Subsidiary; provided, in each case, that the date hereof Borrower shall be in accordance pro forma compliance with the terms covenants contained in Section 5.04, calculated based on the financial statements most recently delivered to the Lender Parties pursuant to Section 5.03 and as though such Debt or Capital Lease Obligations had been incurred at the beginning of Section 5.02the four-quarter period covered thereby, as evidenced by a certificate of the Chief Financial Officer (or person performing similar functions) of the Borrower delivered to the Paying Agent demonstrating such compliance.

Debt. Create, incur, assume or suffer to existexist any Debt, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanexcept: (ia) In Debt created under the case Loan Documents; (b) Guaranteed Debt of Navistar International in respect of Debt under the 2009 Senior Note Indenture governing the 8.25% Senior Notes due November 1, 2021 and any refunding, refinancing or replacement, in whole or in part, of such Debt provided that the Refinancing Conditions are satisfied; (c) Other Existing Debt, and any Debt extending the maturity of, or refunding, replacing or refinancing, in whole or in part, any Existing Debt; provided, that the Refinancing Conditions are satisfied; (d) Debt secured by Liens permitted by Section 6.02(d); provided that the aggregate outstanding principal amount of all such Debt, together with the aggregate amount of Capital Lease Obligations permitted under Section 6.01(e), shall not exceed at any time the greater of (x) $75,000,000 and (y) 2% of the BorrowerConsolidated Net Tangible Assets at the time of the incurrence thereof; (e) Capital Lease Obligations; provided that the aggregate outstanding principal amount of all such Capital Lease Obligations, together with the aggregate amount of Debt permitted under Section 6.01(d), shall not exceed at any time the greater of (x) $75,000,000 and (y) 2% of the Consolidated Net Tangible Assets at the time of the incurrence thereof; (f) Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof practice; (g) intercompany Debt between any Borrower and any other Borrower and/or a Restricted Subsidiary of Navistar International; (h) Subordinated Debt; (i) other Debt not to exceed in the aggregate $2,500,000 200,000,000 at any time outstanding; (iij) Guaranteed Debt of the Borrowers with respect to (x) obligations of NFC under the Receivables Facility and (y) obligations with respect to Navistar International’s financial service operations in Mexico; provided that the case aggregate amount of Holding, all such Guaranteed Debt shall not exceed $50,000,000 at any time outstanding; ABL CREDIT AGREEMENT (Ak) Debt under the Loan Documents, Master Intercompany Agreements and the Support Agreement; (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (Cl) Debt under the 13% Subordinated Notes due May 31, 2009 issued by HoldingPermitted Receivables Financings; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (ivm) Debt owed to the Borrower incurred by any wholly-owned Subsidiary Borrower constituting reimbursement obligations with respect to letters of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions credit issued in the ordinary course of business, including, without limitation, letters of credit in response to worker’s compensation claims or self-insurance; (n) Debt arising from agreements of any Borrower providing for adjustment of purchase price, earn-out or other similar obligations, in each case, incurred or assumed in connection with any acquisition permitted under Section 6.06; (o) obligations in respect of performance and surety bonds and completion guarantees provided by any Borrower in respect of obligations arising in the ordinary course of business and not constituting Debt for Borrowed Money; (p) Debt consisting of notes issued to current or former employees, officers or directors in connection with the redemption or repurchase of Equity Interests held by such Persons in an aggregate amount not in excess of $10,000,000 at any time outstanding; (q) Debt consisting of take-or-pay obligations contained in supply agreements entered into by any Borrower in the ordinary course of business; (r) Debt in respect of any Sale/Leaseback Transaction with respect to the purchase of tooling and related manufacturing equipment in the ordinary course of business; (s) [reserved]; (t) guarantees issued by a Borrower of Debt otherwise permitted hereunder; (u) Investments to the extent constituting Debt (as defined in clause (i) or (j) in the definition of “Debt”); (v) Guarantees issued by a Borrower in connection with Recovery Zone Bonds; and (Fw) Debt (other than Debt comprised Indebtedness of senior any Borrower arising from the honoring by a bank financing or other financial institution of a check, draft or similar working capital financinginstrument inadvertently (except in the case of daylight overdrafts) drawn against insufficient funds in the ordinary course of any Person business; provided, however, that becomes a Subsidiary such Indebtedness is extinguished within five business days after incurrence. The accrual of interest and the Borrower after accretion or amortization of original issue discount on Debt and the date hereof payment of interest in the form of additional Debt originally incurred in accordance with the terms this Section 6.01 will not constitute an incurrence of Section 5.02Debt.

Debt. CreateThe Borrower shall not, incureither directly or indirectly, assume create, assume, incur or suffer to existhave outstanding any Debt (including purchase money indebtedness), or permit become liable, whether as endorser, guarantor, surety or otherwise, for any debt or obligation of its Subsidiaries to createany other Person, incur, assume or suffer to exist, any Debt other thanexcept: (ia) In the case Obligations under this Agreement and the other Loan Documents; (b) obligations of the BorrowerBorrower for Taxes, Debt in respect assessments, municipal or other governmental charges; (c) obligations of Hedge Agreements designed to hedge against fluctuations in interest rates the Borrower for accounts payable, other than for money borrowed, incurred in the ordinary course of business business; (d) Subordinated Debt; (e) Hedging Obligations incurred in favor of the Bank or an Affiliate thereof for bona fide hedging purposes and consistent with prudent business practice with not for speculation; (f) Capitalized Lease Obligations, provided that the aggregate Agreement Value thereof amount of all such Debt outstanding at any time shall not exceed, in the aggregate, Five Hundred Thousand and 00/100 Dollars ($500,000.00) plus the amount of any Capitalized Lease Obligations owing by the Borrower to Green Wing for so long as the Green Wing lease remains subject to an enforceable Subordination Agreement; (g) Debt for Capital Expenditures (other than Capitalized Lease Obligations permitted by Section 9.1(f) and purchase money indebtedness secured by vehicles permitted by Section 9.1(h)) not to exceed Five Hundred Thousand and 00/100 Dollars ($2,500,000 500,000.00) in the aggregate at any time outstandingtime; (ii) in the case of Holding, (Ah) Debt under the Loan Documents, (B) Debt for purchase money indebtedness secured by vehicles in an aggregate principal amount not to exceed Five Hundred Thousand and 00/100 Dollars ($10,000,000 500,000.00) in the aggregate at any time. (i) Debt described on Schedule 7.25 and any extension, renewal or refinancing thereof so long as the principal amount thereof is not increased; (j) other unsecured Debt, in addition to the Debt listed above, in an aggregate amount outstanding at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed Two Hundred Fifty Thousand and 00/100 Dollars ($105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower250,000.00); and (vk) in the case Debt secured only by Liens on amounts deposited by or paid on behalf of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary arising out of the Borrower after the date hereof in accordance with the terms financing of Section 5.02insurance premiums.

Debt. Create, incur, assume or suffer to exist, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanDebt, except: (i) In in the case of the Borrower, , (A) Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates or foreign exchange rates, and not for speculative purposes, incurred in the ordinary course of business and consistent with prudent business practice with practice, and (B) Debt owed to a wholly owned Subsidiary of the aggregate Agreement Value thereof not Borrower, which Debt (x) shall be on subordinated terms reasonably acceptable to exceed $2,500,000 at any time outstanding;the Administrative Agent and (y) shall be evidenced by promissory notes in form and substance reasonably satisfactory to the Administrative Agent. (ii) in the case of Holdingany Subsidiary of the Borrower, (A) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant owed to the Stockholders Agreement Borrower or an Employment Agreement to a wholly owned Subsidiary of the Borrower, provided that (w) that, in each case, such Debt is (x) shall be on terms reasonably acceptable to the Administrative Agent and (y) shall be evidenced by a promissory note notes in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions substance reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding;Administrative Agent; and (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan DocumentsDocuments (which, in the case of Secured Hedge Agreements, should be consistent with the terms of Section 5.02(b)(i)(A)), (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 30,000,000 at any time outstanding, (C1) Debt arising under the Korry Lease in an aggregate amount not to exceed $26,500,000 at any time outstanding and (2) other Capitalized Leases not to exceed in the aggregate $20,000,000 50,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date createdSurviving Debt, and aggregatingany Debt extending the maturity of, on a Consolidated basisor refunding or refinancing, not more than $7,500,000 at in whole or in part, any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions Surviving Debt and any Debt in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary respect of the Borrower after Senior Subordinated Notes or the date hereof in accordance with 2007 Senior Notes, provided that the terms of Section 5.02any such extending, refunding or refinancing Debt, and of any agreement entered into and of any instrument issued in connection therewith, are not otherwise prohibited by the Loan Documents, provided further that the principal amount of such Surviving Debt or Debt in respect of the Senior Subordinated Notes or the 2007 Senior Notes shall not be increased above the principal amount thereof outstanding immediately prior to such extension, refunding or refinancing, and the direct and contingent obligors therefor shall not be changed, as a result of or in connection with such extension, refunding or refinancing, provided still further that the terms relating to principal amount, amortization, maturity, collateral (if any) and subordination (if any), and other material terms taken as a whole, of any such extending, refunding or refinancing Debt, and of any agreement entered into and of any instrument issued in connection therewith, are no less favorable in any material respect to the Loan Parties or the Lender Parties than the terms of any agreement or instrument governing the Debt being extended, refunded or refinanced and the interest rate applicable to any such extending, refunding or refinancing Debt does not exceed the then applicable market interest rate,

Debt. Create, incur, assume or suffer to exist, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other than: : (i) In Debt under the Loan Documents; (ii) in the case of (A) the Borrower, Debt in respect of Hedge Agreements designed Junior Obligations, the proceeds of which are applied to hedge against fluctuations in interest rates incurred in prepay the ordinary course Obligations of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstanding; (ii) in the case of Holding, (A) Debt Borrower under the Loan Documents, Documents in accordance with Section 2.05(b)(ii) and (B) the Borrower and its Subsidiaries, Debt, not exceeding at any one time $20,000,000 in the aggregate, in respect of Obligations incurred pursuant to credit card services agreements providing for processing services in connection with credit card transactions by customers of the Borrower and its Subsidiaries; (iii) the Surviving Debt outstanding as of the Closing Date; (iv) unsecured contingent obligations arising in connection with Permitted Acquisitions in an aggregate principal amount not to exceed $10,000,000 50,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) outstanding in the case of aggregate for the Borrower and its Subsidiaries, provided that no such contingent obligation shall exceed an amount equal to 75% of the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; Purchase Price of the related Permitted Acquisition; (ivv) Debt owed by a Subsidiary to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-wholly- owned Subsidiary of the Borrower; and (v) in the case of , or by the Borrower and any of its Subsidiaries, to a Subsidiary in connection with the Borrower's cash management program; (A) Debt under the Loan Documents, (Bvi) Debt secured by Liens permitted by Section 5.02(a)(iv5.02(a)(ii) and (iv) not to exceed $20,000,000 in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, Borrower and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, its Subsidiaries; (Evii) indorsement endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and ; (Fviii) Debt unsecured trade payables of the kind included in clause (other than Debt comprised of senior bank financing or other similar working capital financingb) of any Person that becomes a Subsidiary the definition of Debt; (ix) Subordinated Debt incurred on or before March 31, 1999; (x) if the Borrower shall have received gross cash proceeds from the sale of the Borrower after Preferred Stock in an aggregate amount of more than $250,000,000 and less than $440,000,000, the date hereof Roche Debt; (xi) Obligations to redeem the Preferred Stock; and (xii) Debt not otherwise permitted pursuant to this Section 5.02(j), in accordance with an aggregate principal amount not to exceed $32,000,000 at any time outstanding in the terms of Section 5.02aggregate for the Borrower and its Subsidiaries.

Debt. CreateNeither the Borrower nor any Restricted Subsidiary will incur, incurcreate, assume or suffer to existexist any Debt, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanexcept: (ia) In the case Notes or other Indebtedness arising under the Loan Documents or any guaranty of or suretyship arrangement for the Borrower, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstanding; (ii) in the case of Holding, (A) Debt Notes or other Indebtedness arising under the Loan Documents, . (Bb) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, Restricted Subsidiaries existing on the Permanent date hereof that is reflected in the Financial Statements. (c) purchase money Debt in an aggregate principal amount and Debt under Capital Leases not to exceed $105,000,000;15,000,000 in the aggregate. (ivd) Debt owed to associated with workers' compensation claims, performance, bid, surety or similar bonds or surety obligations required by Governmental Requirements or third parties in connection with the Borrower by any wholly-owned Subsidiary operation of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; andOil and Gas Properties. (ve) in the case of intercompany Debt between the Borrower and any Restricted Subsidiary or between Restricted Subsidiaries to the extent permitted by Section 9.05(g); provided that such Debt is not held, assigned, transferred, negotiated or pledged to any Person other than the Borrower or one of its Wholly-Owned Subsidiaries,, and, provided further, that any such Debt owed by either the Borrower or a Guarantor shall be subordinated to the Indebtedness on terms set forth in the Guaranty Agreement. (A) Debt under the Loan Documents, (Bf) Debt secured by Liens permitted by Section 5.02(a)(iv9.03(d) and Section 9.03(e), the principal amount of which does not to exceed $5,000,000 in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding,time. (Eg) indorsement endorsements of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and. (Fh) Debt under the 2002 Senior Subordinated Notes and any guarantees thereof by the Guarantors, the principal amount of which does not exceed $200,000,000 in the aggregate. (i) Debt under the Permitted Additional Senior Subordinated Notes issued on or prior to May 1, 2004 and any guarantees thereof by the Guarantors, the principal amount of which does not exceed $200,000,000 in the aggregate. (j) other than Debt comprised of senior bank financing or other similar working capital financing) of not to exceed $20,000,000 in the aggregate at any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02one time outstanding.

Debt. Create, incur, assume Become or suffer to existremain obligated for any Debt for borrowed money, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, for any Debt other thanincurred in connection with the acquisition of any property, real or personal, tangible or intangible, except: (ia) In the case Indebtedness to Lenders (or their Affiliates) hereunder, including without limitation, Hedging Obligations and Special Letters of Credit; (b) Debt not otherwise permitted hereunder which is in existence as of the BorrowerRestatement Date and disclosed on Schedule 8.4(b) attached hereto, and any renewals or refinancing of such Debt in respect of Hedge Agreements designed amounts not exceeding the scheduled amounts (less any required amortization according to hedge against fluctuations the terms thereof), on terms no less favorable to Company and its Subsidiaries than in interest rates incurred effect on the Restatement Date and otherwise in compliance with this Agreement, except for any less favorable terms which may result from changes in market rates; (c) current unsecured trade, utility or non-extraordinary accounts payable arising in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstanding; (ii) in the case unsecured letters of Holding, (A) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) credit undertaken by such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred parties in the ordinary course of business outside the United States of America (and necessary under local customs and practices) to support such accounts payable; (i) purchase money Debt for fixed assets (including operating leases and capitalized leases or other non-cancelable leases having a term of 12 months or longer), (ii) Debt in respect of equipment leasing agreements (based on the aggregate lease payments during the term of such leases and all available extensions), (iii) Debt in respect of real property leases (based on the aggregate lease payments during the term of such leases and all available extensions) provided that the aggregate amount of the Debt permitted under clauses (i)-(iii) herein (excluding such Debt as is set forth on Schedule 8.4(d) attached hereto) shall not exceed ten percent (10%) of Tangible Net Worth; (e) any Debt assumed pursuant to an acquisition conducted in compliance with this Agreement, provided that such Debt was not entered into, extended or renewed in contemplation of such acquisition and provided further that the aggregate amount of all such Debt at any time outstanding shall not exceed ten percent (10%) of Tangible Net Worth; (f) Debt to third parties issued by any Foreign Subsidiary of Company in an aggregate amount at any time outstanding not to exceed seven and a half percent (7.5%) of Tangible Net Worth; provided that such Debt be issued and at all times maintained on a pari passu basis with the Indebtedness, if any, of such Foreign Subsidiary, or on a basis subordinate thereto, and pursuant to documentation containing covenants not more restrictive in the aggregate than the covenants contained in this Agreement (as determined by Agent and Required Lenders in their reasonable discretion) and provided further, however, that immediately before and immediately after such Debt is incurred, and giving effect thereto, no Default or Event of Default has occurred and is continuing (it being understood that for purposes of this Section 8.4(f), the granting of Liens which are permitted under Section 8.5 hereof shall not be deemed to constitute the entry into more restrictive covenants or to be other than on a pari passu basis); (g) Intercompany Loans, but only to the extent permitted under the other applicable terms and limitations of this Agreement, including but not limited to Section 8.7 hereof, and guaranties permitted under Section 8.3 hereof; (h) unsecured Debt issued under Rule 144A of the Securities Act of 1933 or pursuant to a private placement in an aggregate amount for all such Debt issued under this subparagraph (but without giving effect to any repayments or principal reductions thereof) not to exceed Two Hundred Million Dollars ($200,000,000); provided that such Debt be issued and all times maintained on a basis subordinate hereto, and pursuant to documentation containing covenants not more restrictive in the aggregate than the covenants contained in this Agreement (as determined by Agent and the Required Lenders in their reasonable discretion); provided further, however, that immediately before and immediately after such Debt is incurred, and giving effect thereto, no Default or Event of Default has occurred and is continuing; and provided further that prior to or concurrently with the issuance of such Debt, the Company shall prepay the Term Loan Advances by an amount equal to not less than 50% of the proceeds of such Debt, net of normal and customary expenses of issuance payable to third parties; (i) customary representations, warranties and indemnification provisions entered into in connection with the sale, transfer or other disposition of securities or other assets of the Company and its Subsidiaries permitted pursuant to Section 8.2(f); (j) the BCc Replacement Financing, the New Convertible Subordinated Debt and any other Subordinated Debt disclosed on Schedule 8.13 attached hereto, together with any refinancing of such Debt, subject to the following requirements: that such refinancing shall (i) be on terms and conditions substantially similar or more favorable for the deferred purchase price Company and its Subsidiaries to the existing Debt being refinanced, (ii) not increase the then outstanding principal amount of property the Debt being refinanced, (iii) not take place while any Default or servicesEvent of Default shall have occurred and be continuing, maturing within one year or when any Default or Event of Default shall reasonably be expected to result from such refinancing; and (iv) be subject to loan documentation for which draft copies (in substantially final form) are delivered to Agent not less than five (5) days prior to the date created, and aggregating, on of such refinancing (or a Consolidated basis, not more than $7,500,000 at any one shorter time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, period if consented to by Agent); and (Fk) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02unsecured Commodities Hedging Obligations.

Debt. Create, incur, assume Become or suffer to existremain obligated for any Debt for borrowed money, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, for any Debt other thanincurred in connection with the acquisition of any property, real or personal, tangible or intangible, except: (ia) In the case Indebtedness to Lenders (or their Affiliates) hereunder, including without limitation, Hedging Obligations and Special Letters of Credit; (b) Debt not otherwise permitted hereunder which is in existence as of the BorrowerRestatement Date and disclosed on Schedule 8.4(b) attached hereto, and any renewals or refinancing of such Debt in respect of Hedge Agreements designed amounts not exceeding the scheduled amounts (less any required amortization according to hedge against fluctuations the terms thereof), on terms no less favorable to Company and its Subsidiaries than in interest rates incurred effect on the Restatement Date and otherwise in compliance with this Agreement, except for any less favorable terms which may result from changes in market rates; (c) current unsecured trade, utility or non-extraordinary accounts payable arising in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstanding; (ii) in the case unsecured letters of Holding, (A) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) credit undertaken by such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred parties in the ordinary course of business outside the United States of America (and necessary under local customs and practices) to support such accounts payable; (i) purchase money Debt for fixed assets (including operating leases and capitalized leases or other non-cancelable leases having a term of 12 months or longer), (ii) Debt in respect of equipment leasing agreements (based on the aggregate lease payments during the term of such leases and all available extensions), (iii) Debt in respect of real property leases (based on the aggregate lease payments during the term of such leases and all available extensions) provided that the aggregate amount of the Debt permitted under clauses (i)-(iii) herein (excluding such Debt as is set forth on Schedule 8.4(d) attached hereto) shall not exceed ten percent (10%) of Tangible Net Worth; (e) any Debt assumed pursuant to an acquisition conducted in compliance with this Agreement, provided that such Debt was not entered into, extended or renewed in contemplation of such acquisition and provided further that the aggregate amount of all such Debt at any time outstanding shall not exceed ten percent (10%) of Tangible Net Worth; (f) Debt to third parties issued by any Foreign Subsidiary of Company in an aggregate amount at any time outstanding not to exceed seven and a half percent (7.5%) of Tangible Net Worth; provided that such Debt be issued and at all times maintained on a pari passu basis with the Indebtedness, if any, of such Foreign Subsidiary, or on a basis subordinate thereto, and pursuant to documentation containing covenants not more restrictive in the aggregate than the covenants contained in this Agreement (as determined by Agent and Required Lenders in their reasonable discretion) and provided further, however, that immediately before and immediately after such Debt is incurred, and giving effect thereto, no Default or Event of Default has occurred and is continuing (it being understood that for purposes of this Section 8.4(f), the granting of Liens which are permitted under Section 8.5 hereof shall not be deemed to constitute the entry into more restrictive covenants or to be other than on a pari passu basis); (g) Intercompany Loans, but only to the extent permitted under the other applicable terms and limitations of this Agreement, including but not limited to Section 8.7 hereof, and guaranties permitted under Section 8.3 hereof; (h) unsecured Debt issued under Rule 144A of the Securities Act of 1933 or pursuant to a private placement in an aggregate amount for all such Debt issued under this subparagraph (but without giving effect to any repayments or principal reductions thereof) not to exceed Two Hundred Million Dollars ($200,000,000); provided that such Debt be issued and all times maintained on a basis subordinate hereto, and pursuant to documentation containing covenants not more restrictive in the aggregate than the covenants contained in this Agreement (as determined by Agent and the Required Lenders in their reasonable discretion); provided further, however, that immediately before and immediately after such Debt is incurred, and giving effect thereto, no Default or Event of Default has occurred and is continuing; and provided further that prior to or concurrently with the issuance of such Debt, the Revolving Credit Aggregate Commitment is permanently reduced by an amount equal to not less than 50% of the proceeds of such Debt, net of normal and customary expenses of issuance payable to third parties; (i) customary representations, warranties and indemnification provisions entered into in connection with the sale, transfer or other disposition of securities or other assets of the Company and its Subsidiaries permitted pursuant to Section 8.2(f); (j) the BCc Replacement Financing, the New Convertible Subordinated Debt and any other Subordinated Debt disclosed on Schedule 8.13 attached hereto, together with any refinancing of such Debt, subject to the following requirements: that such refinancing shall (i) be on terms and conditions substantially similar or more favorable for the deferred purchase price Company and its Subsidiaries to the existing Debt being refinanced, (ii) not increase the then outstanding principal amount of property the Debt being refinanced, (iii) not take place while any Default or servicesEvent of Default shall have occurred and be continuing, maturing within one year or when any Default or Event of Default shall reasonably be expected to result from such refinancing; and (iv) be subject to loan documentation for which draft copies (in substantially final form) are delivered to Agent not less than five (5) days prior to the date created, and aggregating, on of such refinancing (or a Consolidated basis, not more than $7,500,000 at any one shorter time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, period if consented to by Agent); and (Fk) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02unsecured Commodities Hedging Obligations.

Debt. CreateNone of the Obligors or their Subsidiaries (other than Unrestricted Entities) and none of the Partnerships will incur, incurcreate, assume or suffer permit to existexist any Debt, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanexcept: (ia) In the case Notes or other Indebtedness or any guaranty of or suretyship arrangement for the Notes or other Indebtedness; (b) Debt of the BorrowerBorrower disclosed in Schedule 9.01, Debt in respect and any renewals or extensions (but not increases) thereof; (c) accounts payable (for the deferred purchase price of Hedge Agreements designed Property or services) from time to hedge against fluctuations in interest rates time incurred in the ordinary course of business and consistent which, if greater than 90 days past the invoice or billing date, are being contested in good faith by appropriate proceedings if reserves adequate under GAAP shall have been established therefor; (d) Debt under leases permitted under Section 9.08; (e) Debt associated with prudent business practice bonds or surety obligations pursuant to Governmental Requirements in connection with the aggregate Agreement Value thereof operation of any Obligor’s Oil and Gas Properties; (f) Debt of the Obligors under Hedging Agreements permitted under Section 9.02; (g) Debt to AAI not to exceed $2,500,000 at any time outstanding; (ii) 15,000,000 in the case of Holdingaggregate; provided, (A) Debt under the Loan Documentsthat, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) all such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise debt shall be unsecured and subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender PartiesAdministrative Agent; (h) Intercompany Debt; provided, that, (xi) any such Intercompany Debt shall not bear interest on a cash basis prior be subordinated to the Termination Date, (y) the final maturity of such Debt is after the Termination Date Obligations upon terms and (z) amortization of such Debt is not required prior conditions satisfactory to the Termination DateAdministrative Agent, and (Cii) such Intercompany Debt in excess of $250,000 shall be evidenced by an Intercompany Note pledged to secure the Obligations and in the possession of the Administrative Agent; and (i) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount Subsidiaries not otherwise described under subparagraphs (a) through (g) above not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) 5,000,000 in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02aggregate.

Debt. Create, incur, assume or suffer to exist, or permit any of its Subsidiaries to Such Loan Party will not create, incur, assume or suffer to existexist any Debt, any Debt other than:except (without duplication): (i) In the case Debt of the BorrowerLoan Parties (A) under the Loan Documents, and (B) pursuant to any Permitted Expansion Facility; (ii) to the extent constituting Debt, obligations of the Borrowers under the Permitted Commodity Hedge and Power Sale Agreements to the extent permitted to be entered into under this Agreement; (iii) Debt of the Borrowers secured by Liens permitted by clause (o) of the definition of “Permitted Liens” not to exceed in the aggregate, when taken together with any outstanding Debt permitted to be incurred pursuant to sub-clause (iv) or (v), $20,000,000 at any time outstanding in the aggregate for the Borrowers; provided that any such Debt (A) shall be secured only by the Property acquired in connection with the incurrence of such Debt and (B) shall constitute not more than 90% of the aggregate consideration paid with respect to such Debt; (iv) Capitalized Leases of Hedge Agreements the Borrowers not to exceed in the aggregate, when taken together with any outstanding Debt permitted to be incurred pursuant to sub-clause (iii) or (v), $20,000,000 at any time outstanding in the aggregate for the Borrowers; (v) Debt of any Borrower incurred for the purpose of funding any Required Capital Expenditures not to exceed in the aggregate, when taken together with outstanding Debt permitted to be incurred pursuant to sub-clauses (iii) and (iv), $20,000,000 at any time outstanding in the aggregate for the Borrowers; (vi) to the extent constituting Debt, obligations of the Borrowers under Interest Rate Hxxxxx designed to hedge against fluctuations in interest rates incurred in the ordinary course of business (it being acknowledged and consistent agreed that any such Interest Rate Hxxxxx entered into by the Borrowers for the purpose of complying with prudent business practice Section 7.01(m) above (or any similar obligation with respect to the aggregate Agreement Value thereof not Permitted Expansion Facility) shall be deemed to exceed $2,500,000 at any time outstandingbe permitted Debt under this sub-clause (vi)); (iivii) in unsecured subordinated Debt of any Loan Party to any other Loan Party (including intercompany loans amongst the case of Holding, Loan Parties); provided that (A1) all such Debt shall constitute Pledged Debt subject to the Lien created under the Loan Documents, Security Agreement and (B2) all such Debt shall be on terms and conditions set forth on Exhibit H or such other terms reasonably acceptable to the Administrative Agent; (viii) other unsecured Debt of the Borrowers in an aggregate principal amount not to exceed $10,000,000 at any one time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holdingoutstanding; (iiiix) to the extent constituting Debt, contingent obligations under or in the respect of performance bonds, bid bonds, appeal bonds, surety bonds, financial assurances and completion guarantees, indemnification obligations, obligations to pay insurance premiums, take or pay obligations and similar obligations in each case of the any Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business and not in connection with Debt for Borrowed Money; (x) to the deferred purchase price of property or servicesextent constituting Debt, maturing within one year Debt arising from the date createdhonoring by a bank or other financial institution of a check, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection draft or similar transactions instrument drawn against insufficient funds in the ordinary course of business or other cash management services in the ordinary course of business; provided that such Debt is extinguished within 10 Business Days of its incurrence; (xi) guaranties by the Borrowers of Debt of another Loan Party or guaranties by a Loan Party of Debt of another Loan Party with respect, in each case, to Debt otherwise permitted to be incurred pursuant to this clause (b); provided that, if the Debt that is being guaranteed is unsecured and/or subordinated to the Obligations of the Loan Parties under the Loan Documents, the guaranty shall also be unsecured and/or subordinated to the Obligations of the Loan Parties under the Loan Documents; (xii) loans to a Loan Party; provided that such loans are subject to the terms of subordination attached hereto as Exhibit H or such other terms reasonably acceptable to the Administrative Agent; and (Fxiii) Debt trade payables incurred in the ordinary course of business (other but not for borrowed money) and (A) not more than Debt comprised of senior bank financing 90 days past due or other similar working capital financing(B) of any Person that becomes a Subsidiary of the Borrower after the date hereof being contested in accordance with the terms of Section 5.02good faith by appropriate proceedings.

Debt. CreateThe Company shall not, incurand shall not permit any Subsidiary to, assume become or suffer to existremain obligated for any indebtedness for borrowed money, or permit for any indebtedness incurred in connection with the acquisition of its Subsidiaries to createany property, incurreal or personal, assume tangible or suffer to existintangible, any Debt other thanexcept: (ia) In indebtedness to the case of the Borrower, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstandingPurchasers; (iib) indebtedness to the Lenders under the Credit Agreement in the case of Holding, (A) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that sum of (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (yi) the final maturity product of such (A) $25,000,000 of term Debt minus the sum of all scheduled principal payments (scheduled as of the date the Credit Agreement is after entered into by the Termination Date and parties thereto) multiplied by (zB) amortization 1.30, plus (ii) the product of such (A) $12,000,000 of revolving Debt is not required prior to the Termination Date, and multiplied by (CB) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding1.30; (iiic) current unsecured trade payables and accrued liabilities arising in the case ordinary course of the Borrower Company's or any Subsidiary's business, deferred income tax and its Subsidiaries, purchase accounting reserves; (d) purchase money indebtedness for the Permanent Debt acquisition of fixed assets in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed 500,000 in the aggregate during any fiscal year of the Company (determined on a combined basis for the Company and its Subsidiaries). (e) existing indebtedness listed in attached REVISED SCHEDULE 9.04 attached to this Agreement. (f) unsecured indebtedness of the Company to its wholly owned Material Subsidiaries or a wholly owned Material Subsidiary to another wholly owned Material Subsidiary or a wholly owned Material Subsidiary to the Company. (g) other unsecured indebtedness not exceeding $10,000,000 100,000 in the aggregate at any time outstanding,. (Ch) Capitalized Leases indebtedness under any Interest Rate Protection Agreements. (i) unsecured indebtedness of Densitron Microwave Limited or DML Microwave Limited under an overdraft line of credit in an amount not to exceed exceeding 500,000 Pounds Sterling in the aggregate $20,000,000 at any time outstanding,. (Dj) unsecured Debt indebtedness of DML Microwave Limited to MCE Europe, Inc. in an amount not exceeding 3,000,000 Pounds Sterling incurred to consummate the Acquisition and until June 30, 2000 unsecured indebtedness of Densitron Microwave Limited to MCE Europe, Inc. in the ordinary course of business an amount not to exceed 2,000,000 Pounds Sterling incurred for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02purposes.

Debt. Create, incur, assume Become or suffer to existremain obligated for any indebtedness for borrowed money, or permit for any indebtedness incurred in connection with the acquisition of its Subsidiaries to createany property, incurreal or personal, assume tangible or suffer to existintangible, or for any Debt other thanDebt, except for: (ia) In the case of the BorrowerIndebtedness to Banks hereunder; 101 (b) current unsecured trade, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred utility or non-extraordinary accounts payable arising in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof Company's or any Subsidiary's businesses; (c) purchase money debt for fixed assets (including capitalized leases or other non-cancelable leases having a term of twelve months or longer) not to exceed $2,500,000 at any time outstanding; (ii) an aggregate amount, for the Company and its Subsidiaries incurred while in compliance with this Agreement and the case of Holding, (A) Debt under the other Loan Documents, of Three Million Dollars (B$3,000,000) Debt (or the Alternative Currency equivalent thereof) at any one time outstanding and mortgage debt incurred (by assumption or otherwise) by Arlington Investment Company, a Subsidiary of the Company, in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 1,000,000.00 at any time outstanding,; (Cd) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) Senior Debt, Future Debt, Permitted CAC UK Debt, the Subordinated Debt, unsecured Debt incurred overdraft lines of credit or similar credit arrangements maintained by the Permitted Borrowers in the ordinary course of business for in the deferred purchase price countries of property their formation, in an amount not to exceed, in the case of CAC UK, Pound 2,000,000 and in the case of each of the other Permitted Borrowers, $1,500,000, or servicesthe equivalent thereof in an Alternative Currency, maturing within one year from the date createdlines of credit maintained by Arlington Investment Company, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, in an aggregate amount not to exceed $5,000,000.00 at any time outstanding, and such other debt set forth in Schedule 8.5 attached hereto, if any (in addition to any other matters set forth in this Section 8.5), and any renewals or refinancing of such indebtedness in amounts not exceeding the scheduled amounts (less any required amortization according to the terms thereof) on substantially the same terms and otherwise in compliance with this Agreement; (e) non-recourse Debt incurred by a Special Purpose Subsidiary pursuant to a Permitted Securitization; and (Ff) debt consisting of interest rate protection agreements (including interest rate caps, collars or swaps) or foreign currency exchange agreements (including foreign currency hedgxx xxx swaps) entered into by the Company and/or a Permitted Borrower, to manage existing or anticipated interest rate or foreign exchange rate risk and not for speculative purposes (copies of which shall be provided to the Agent promptly upon the execution thereof), and other Debt for borrowed money in an amount not to exceed in the aggregate for the Company and its Subsidiaries at any time outstanding, the sum of Five Million Dollars (other than $5,000,000) (or the Alternative Currency equivalent thereof), which Debt comprised of senior bank financing or other similar working capital financing) shall be unsecured except to the extent of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Lien permitted under Section 5.028.6(d) hereof.

Debt. CreateNeither the Borrower nor any Subsidiary will incur, incurcreate, assume or suffer permit to existexist any Debt, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanexcept: (ia) In the case Notes or other Indebtedness or any guaranty of or suretyship arrangement for the Notes or other Indebtedness; (b) Debt of the BorrowerBorrower existing on the Closing Date which is reflected in the Financial Statements or is disclosed in Schedule 9.01, Debt in respect and any renewals, extensions refinancings or replacements (but not increases) thereof; (c) accounts payable (for the deferred purchase price of Hedge Agreements designed Property or services) from time to hedge against fluctuations in interest rates time incurred in the ordinary course of business which, if greater than 90 days past due, are being contested in good faith by appropriate proceedings and consistent with prudent business practice with for which reserves adequate under GAAP shall have been established therefor; (d) Debt under capital leases (as required to be reported on the aggregate Agreement Value thereof financial statements of the Borrower pursuant to GAAP) not to exceed $2,500,000 at any time outstanding2,000,000; (ii) in the case of Holding, (Ae) Debt under associated with bonds or surety obligations required by Governmental Requirements in connection with the Loan Documents, operation of Oil and Gas Properties; (Bf) Debt in an aggregate principal amount not to exceed $10,000,000 at of the Guarantors permitted by Section 9.03(h); (g) Debt of any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) Special Entity so long as such Debt is evidenced by a promissory note non-recourse in substantially the form of Exhibit B all respects to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiariesother Subsidiaries other than to the Capital Stock of such Special Entity; (h) additional Debt of any Special Entity not otherwise allowed by Section 9.01(g), so long as the Permanent Debt in an aggregate principal amount of all such Debt of all Special Entities at any one time outstanding does not to exceed $105,000,0002,000,000; (ivi) Debt of any Subsidiary owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under other Subsidiaries to the Loan Documents, (B) Debt secured by Liens extent permitted by Section 5.02(a)(iv9.03; (j) Debt of the Borrower not otherwise allowed under this Section 9.01 not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 25,000,000 outstanding at any one time outstanding,time; and (Ek) indorsement Debt taking the form of negotiable instruments for deposit or collection or similar transactions a guarantee by the Borrower of the trade payables of Retex Inc. arising in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02.

Debt. CreateNeither QSRD nor any of its Subsidiaries, including the Borrower, will incur, create, assume or suffer to existexist any Debt, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanexcept: (ia) In the case Indebtedness or any guaranty of or suretyship arrangement for the BorrowerIndebtedness including Debt to issuers of letters of credit that are the subject of L/C Guarantees; (b) the Debt of any Obligor existing on and not repaid on the Closing Date which is disclosed in Schedule 9.01, Debt in respect and any renewals or extensions (but not increases) thereof, (c) accounts payable (for the deferred purchase price of Hedge Agreements designed Property or services) from time to hedge against fluctuations in interest rates time incurred in the ordinary course of business and consistent with prudent business practice with which, if greater than 90 days past the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstandinginvoice or billing date, are being contested in good faith by appropriate proceedings if reserves adequate under GAAP shall have been established therefor; (ii) in the case of Holding, (Ad) Debt under capital leases (as required to be reported on the Loan Documents, (Bfinancial statements of QSRD pursuant to GAAP) and other Debt of QSRD and the Borrower not otherwise permitted under this Section 9.01 in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 500,000 at any one time outstanding,; (Ee) indorsement Debt of negotiable instruments for deposit the Borrower under Risk Management Agreements with any Eligible Counterparty; (f) Debt associated with bonds or collection surety obligations required by Governmental Requirements in connection with the operation of the Oil and Gas Properties; (g) the Subordinated Debt; (h) intercompany Debt to the extent permitted by Section 9.03; (i) Debt arising from or similar transactions related to any of the Liens described in clauses (iii) to (v) of the ordinary course definition of business, "Excepted Liens"; (j) Non-Recourse Debt of any Non-Recourse Subsidiary; and (Fk) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of QSRD and its Subsidiaries, including the Borrower after Borrower, incurred pursuant to the date hereof in accordance with the terms of Section 5.02Senior Note Documents.

Debt. CreateThe Borrower will not, and will not permit any other Obligor to, incur, assume or suffer to exist, or permit any of its Subsidiaries to create, incurassume, assume permit or suffer to exist, any Debt other thanexcept: (a) The Obligations to the Lender Parties. (b) Debt (including Subordinated Debt) in existence on the Closing Date and listed in Schedule 6.2, together with any extension, renewal or replacement thereof (so long as such indebtedness is not increased above the amount outstanding immediately prior to giving effect to any such extension, renewal or replacement). (i) In the case Debt of the BorrowerBorrower to any Subsidiary and of any Domestic Subsidiary to the Borrower or any other Subsidiary and (ii) Debt of any Foreign Subsidiary to the Borrower or any Domestic Subsidiary in an outstanding principal amount, which Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred under this clause (c)(ii) together with any Debt under clause (d)(iv) below, shall not at any time exceed $2,000,000 in the ordinary course aggregate; (d) Guaranties by (i) the Borrower of business Debt of any Domestic Subsidiary, (ii) any Domestic Subsidiary of Debt of the Borrower or any other Domestic Subsidiary, (iii) any Foreign Subsidiary of Debt of any other Subsidiary and consistent (iv) the Borrower or any Domestic Subsidiary of Debt of any Foreign Subsidiary in an outstanding principal amount, which together with prudent business practice any Debt incurred pursuant to clause (c)(ii) above, shall not at any time exceed $2,000,000 in the aggregate. (i) Debt of the Borrower or any Subsidiary incurred to finance the acquisition, construction or improvement of any fixed or capital assets, including Capital Leases, so long as such Debt is incurred prior to or within 90 days after such acquisition or the completion of such construction or improvement and (ii) any Debt assumed in connection with the acquisition of any such assets or secured by a Lien on any such assets prior to the acquisition thereof, and extensions, renewals and replacements of any such Debt that do not increase the outstanding principal amount thereof; provided, that the aggregate Agreement Value thereof principal amount of all such Debt incurred pursuant to clauses (i) and (ii) shall not to exceed $2,500,000 5,000,000 at any time outstanding;. (iif) in the case of Holding, (A) Debt under the Loan Documents, (B) Other unsecured Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 2,500,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02.

Debt. Create, incur, assume or suffer to existexist any Debt, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanexcept: (ia) In Obligations under this Agreement and the case other Loan Documents; (b) Debt secured by Liens permitted by Sections 7.02(d), 7.02(h) and 7.02(j), and extensions, renewals and refinancings thereof; provided that the aggregate amount of all such Debt at any time outstanding shall not exceed $25,000,000; (c) Debt of a Co-Borrower to any domestic Wholly-Owned Subsidiary or Debt of any Wholly-Owned Subsidiary to a Co-Borrower or to a domestic Wholly-Owned Subsidiary; provided that such Debt shall be evidenced by a demand note in form and substance reasonably satisfactory to the Administrative Agent and pledged and delivered to the Administrative Agent pursuant to the Collateral Documents as additional collateral security for the Obligations, and the obligations under such demand note shall be subordinated to the Obligations of the BorrowerCo-Borrowers hereunder in a manner reasonably satisfactory to the Administrative Agent; (d) Subordinated Debt; (e) Hedging Obligations approved by Administrative Agent and incurred in favor of a Lender or an Affiliate thereof for bona fide hedging purposes and not for speculation; (f) Debt described on Schedule 7.01 and any extension, renewal or refinancing thereof so long as the principal amount thereof is not increased; (g) Debt in respect of Hedge Agreements designed secured obligations pursuant to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof one or more Factoring Facilities, not to exceed $2,500,000 30,000,000 in the aggregate amount at any one time outstanding; (ii) in the case of Holding, (Ah) Debt assumed in connection with Acquisitions permitted under the Loan Documents, (B) Debt in an aggregate principal amount Section 7.05 not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holdingoutstanding; (iiii) Debt consisting of seller financing incurred in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount connection with Acquisitions permitted under Section 7.05 not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding,; (Cj) Capitalized Leases Debt incurred by a Co-Borrower or any Subsidiaries arising from agreements providing for indemnification, adjustment of purchase price, earn-outs or similar obligations, or from guaranties or letters of credit, surety bonds or performance bonds securing the performance of such Co-Borrower or any such Subsidiary pursuant to such agreements; (k) guaranties by any Co-Borrower or any Subsidiary of Debt of any other Co-Borrower or any Subsidiary with respect to, in each case, Debt otherwise permitted to be incurred pursuant to this Section 7.01; and (l) so long as there exists no Default before and immediately after giving effect to the incurrence of any such Debt, other unsecured Debt, in addition to the Debt listed above, in an aggregate outstanding amount not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than exceeding $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.0225,000,000.

Debt. CreateThe Borrower will not, nor will it permit any Subsidiary of the Borrower to, incur, assume or suffer to existcreate, assume, or permit to exist any of its Subsidiaries to createDebt, incur, assume or suffer to exist, any Debt other thanexcept: (ia) In Debt to the case of Lenders pursuant to the Borrower, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstandingLoan Documents; (ii) in the case of Holding, (Ab) Debt under described on Schedule 8.9, and any extensions, renewals, or refinancings of such existing Debt so long as (i) the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) of such Debt is evidenced by a promissory note in substantially after such renewal, extension, or refinancing shall not exceed the form principal amount of Exhibit B such Debt which was outstanding immediately prior to the Stockholders Agreement such renewal, extension, or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms refinancing and conditions reasonably satisfactory to the Lender Parties, (xii) such Debt shall not bear interest on a cash basis be secured by any assets other than assets securing such Debt, if any, prior to the Termination Datesuch renewal, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Dateextension, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holdingor refinancing; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (ivc) Debt of a Subsidiary Guarantor owed to the Borrower by or another Subsidiary Guarantor; provided that such Debt must according to its terms be fully subordinate in all respects to any wholly-owned of such Subsidiary of Guarantor's indebtedness, liabilities, or obligations to the Borrower or Debt owed Agent and the Lenders pursuant to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; andLoan Document; (vd) in the case of the Borrower Guaranties and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured other Debt incurred in the ordinary course of business with respect to surety and appeal bonds, performance and return-of-money bonds, banker's acceptances, and other similar obligations including those of the type otherwise described in Section 10.2(f); (e) Debt of the Borrower or any Subsidiary of the Borrower constituting purchase money Debt (including, without limitation, Capital Lease Obligations) and secured by purchase money Liens permitted by Section 10.2(g), such Debt, in the aggregate, not to exceed at any time an amount equal to five percent (5.0%) of the Borrower's Tangible Net Worth; (f) Debt of the Borrower or any Subsidiary of the Borrower of the type described in clause (l) of the definition of Debt, such Debt, in aggregate principal or principal equivalent amount, not to exceed at any time an amount equal to twenty percent (20.0%) of the Borrower's Tangible Net Worth. (g) Debt constituting obligations to reimburse worker's compensation insurance companies for claims paid by such companies on behalf of the Borrower or any Subsidiary of the Borrower in accordance with the policies issued to the Borrower or any such Subsidiary; (h) Debt secured by the Liens permitted by Section 10.2(d) and Section 10.2(e); (i) unsecured Debt arising under, created by, and consisting of Hedge Agreements; provided, (i) such Hedge Agreements shall have been entered into for the deferred purchase price purpose of property hedging actual risk and not for speculative purposes and (ii) that each counterparty to such Hedge Agreement shall be a Lender or servicesshall be rated at least AA- by Standard and Poor's Rating Service or Aa3 by Moodx'x Xxxestors Service, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding,Inc.; (Ej) indorsement Debt arising from endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, andbusiness of the Borrower or a Subsidiary of the Borrower; (Fk) Debt (other than of a Subsidiary of the Borrower acquired after the Closing Date and Debt comprised of senior bank financing a Person merged or other similar working capital financing) of any Person that becomes consolidated with or into the Borrower or a Subsidiary of the Borrower after the date hereof Closing Date, (i) which Debt in accordance each case exists at the time of such acquisition, merger, or consolidation, (ii) which Debt was not created or incurred in contemplation of such acquisition, merger, or consolidation, (iii) where such acquisition, merger, or consolidation is not prohibited under this Agreement, (iv) where the aggregate principal of all such Debt at any time outstanding does not exceed an amount equal to ten percent (10.0%) of the Borrower's Tangible Net Worth, and (v) Guarantees of Debt permitted under this Section 10.1; (l) In addition to the Debt described in the foregoing clauses (a) through (k), Debt which when combined with the terms Debt described in clause (k) preceding does not exceed twelve and one-half percent (12.5%) of Section 5.02the Borrower's Tangible Net Worth in aggregate principal amount at any time outstanding; and (m) Debt consisting of letters of credit and reimbursement obligations therefor where the aggregate face amount of such letters of credit do not at any time exceed the sum of (i) the aggregate amount of the Commitments then in effect plus (ii) $20,000,000; provided that Debt permitted hereunder which consists of standby letters of credit and reimbursement obligations therefor shall not at any time exceed an aggregate face amount of $20,000,000.

Debt. Create, incur, assume or suffer to exist, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other than: (i) In Debt under the case of the Borrower, Loan Documents, (ii) Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates or foreign exchange rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstanding; (ii) in the case of Holding, (A) Debt under the Loan Documents, (B) Debt in an aggregate principal notional amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear 125,000,000 for interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 rate Hedge Agreements at any time outstanding, (Ciii) Capitalized Leases assumed pursuant to an Investment permitted pursuant to Section 5.02(e)(ii)(B), so long as such Capitalized Leases are not entered into in contemplation of such Investment, (iv) Capitalized Leases, so long as the aggregate principal amount of such Capitalized Leases outstanding at any time plus the aggregate principal amount of Liens permitted pursuant to Section 5.02(a)(v) outstanding at any time shall not exceed $10,000,000, (v) Debt assumed or incurred in connection with Capital Expenditures secured by Liens permitted by Section 5.02(a)(v), (vi) unsecured Debt in an aggregate amount not to exceed in the aggregate $20,000,000 at any time outstanding3,000,000, (Dvii) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstandingSurviving Debt, (Eviii) Debt under the Senior Subordinated Notes and, with respect to Loan Parties which are Subsidiaries of the Borrower, Subordinated Guaranties, (ix) Debt consisting of take-or-pay contracts assumed by the Borrower in connection with the acquisition of SpectraCair in an aggregate amount not to exceed $7,500,000, (x) Debt in respect of indemnities given by the Borrower in connection with Investments permitted pursuant to Section 5.02(e)(ii)(B) and divestitures permitted pursuant to Section 5.02(f), so long as such indemnities are customary for comparable transactions and consistent with prior practice of the Borrower, (xi) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, (xii) any Guaranty of Obligations under the Loan Documents, (xiii) Debt to the Borrower or to its wholly owned U.S. Subsidiaries, subject in each case to the extent permitted by Section 5.02(e)(ii)(A) and (B); provided that such Debt shall (x) constitute Pledged Debt and (y) shall be evidenced by promissory notes in form and substance satisfactory to the Administrative Agent and such promissory notes shall be pledged as security for the Obligations under the Loan Documents to the holder thereof, and (Fxiv) subordinated Debt incurred solely in connection with an Investment made pursuant to Section 5.02(e)(ii)(B), provided that (other 1) such Debt shall mature not earlier than two years following the Termination Date and shall not bear cash interest until such date, (2) such Debt comprised shall contain subordination terms acceptable to the Required Lenders, (3) after giving effect to the incurrence of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of such Debt, the Borrower after the date hereof shall be in accordance compliance with the financial ratios referred to in Section 5.02(e)(ii)(B) and (4) such Debt shall otherwise be on terms of Section 5.02acceptable to the Administrative Agent.

Debt. Create, incur, assume or suffer to exist, or The Borrowers will not permit any of its Subsidiaries Subsidiary that is not a Loan Party to create, incur, assume or suffer permit to existexist any Debt, any Debt other thanexcept: (ia) In Debt existing on the case Closing Date and set forth in Schedule III and any Refinancing Debt in respect thereof; (b) Debt of any Restricted Subsidiary to a Borrower or any other Restricted Subsidiary; (c) Guarantees by any Restricted Subsidiary of Debt of a Borrower or any other Restricted Subsidiary; provided that (x) the BorrowerDebt of any Restricted Subsidiary so Guaranteed is permitted by this Section (other than clause (e)), (y) Guarantees permitted under this clause (c) shall be subordinated to the Obligations to the same extent and on the same terms as the Debt so Guaranteed is subordinated to the Obligations and (z) to the extent required pursuant to Section 9.16 and the definition of “Guarantor”, any such Restricted Subsidiary shall have also Guaranteed the Obligations; (d) (A) Debt incurred to finance the acquisition, construction, repair, replacement or improvement of any fixed or capital assets, including Capital Lease Obligations and any Debt assumed in connection with the acquisition of any such assets or secured by a Lien on any such assets prior to the acquisition thereof; provided that such Debt is incurred prior to or within 270 days after such acquisition or the completion of such construction, repair, replacement or improvement, and (B) Refinancing Debt in respect of Hedge Agreements designed Debt incurred or assumed pursuant to hedge against fluctuations in interest rates incurred in clause (A) above; provided further that at the ordinary course time of business and consistent with prudent business practice incurrence thereof, the aggregate principal amount of Debt permitted by this clause (d), together (without duplication) with the aggregate Agreement Value thereof principal amount of outstanding Debt secured by Liens incurred pursuant to Section 5.6(d), shall not exceed the greater of (x) $100,000,000 and (y) 4.25% of Consolidated Total Assets as of the fiscal year most recently ended prior to exceed the incurrence of such Debt; (e) (A) Debt of any Person that becomes a Restricted Subsidiary (or of any Person not previously a Restricted Subsidiary that is merged or consolidated with or into a Restricted Subsidiary in a transaction permitted hereunder) after the Effective Date, or Debt of any Person that is assumed by any Restricted Subsidiary in connection with an acquisition of assets by such Restricted Subsidiary in an acquisition permitted by this Agreement; provided that such Debt exists at the time such Person becomes a Restricted Subsidiary (or is so merged or consolidated) or such assets are acquired and is not created in contemplation of or in connection with such Person becoming a Restricted Subsidiary (or such merger or consolidation) or such assets being acquired and (B) Refinancing Debt in respect of Debt incurred or assumed, as applicable, pursuant to clause (A) of this Section 5.5(e); (f) other Debt, together (without duplication) with the aggregate principal amount of outstanding Debt of the Loan Parties secured by Liens incurred pursuant to Section 5.6(h), in an aggregate principal amount not exceeding at the time of incurrence thereof, the greater of (A) $2,500,000 250,000,000 and (B) 10.50% of Consolidated Total Assets as of the fiscal year most recently ended prior to the incurrence of such Debt at any time outstanding; (ii) in the case of Holding, (A) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (ivg) Debt owed to any Person (including obligations in respect of letters of credit for the Borrower by any wholly-owned Subsidiary benefit of the Borrower such Person) providing workers’ compensation, health, disability or Debt owed other employee benefits or property, casualty or liability insurance, pursuant to a wholly-owned Subsidiary of the Borrower by the Borrower reimbursement or any other wholly-owned Subsidiary of the Borrower; and (v) indemnification obligations to such Person, in the each case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding,business; (Eh) indorsement Debt in respect of negotiable instruments for deposit or collection or performance bonds, bid bonds, appeal bonds, surety bonds, bankers acceptances drafts, performance and completion guarantees and similar transactions obligations (other than in respect of other Debt), in each case provided in the ordinary course of business; (i) Debt owed in respect of any overdrafts and related liabilities arising from treasury, depositary and cash management services or in connection with any automated clearinghouse transfers of funds; provided that such Debt shall be repaid in full within five Business Days of the incurrence thereof; (j) Debt in the form of purchase price adjustments, earnouts, non-competition agreements or other arrangements representing acquisition consideration or deferred payments of a similar nature incurred in connection with any acquisition or other investment permitted under this Agreement; and (Fk) Debt (other than Debt comprised representing deferred compensation to directors, officers, consultants or employees of senior bank financing a Borrower or other similar working capital financing) a Restricted Subsidiary incurred in the ordinary course of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02business.

Debt. CreateContract, incur, assume or suffer to exist, or permit any of its Subsidiaries to create, incur, assume or suffer to existexist any Debt, or permit any Debt other than: of its Material Subsidiaries to contract, create, incur, assume or suffer to exist any Debt, except for (i) In Debt under this Agreement and the other Loan Documents, (ii) Debt under the Term Facility Credit Agreement and other Term Facility Loan Documents, (iii) Surviving Debt (including the Existing Receivables Facility) and any Permitted Refinancing thereof (it being understood that in the case of a Permitted Refinancing of the BorrowerExisting Receivables Facility, the aggregate principal amount of such Debt being refinanced in connection therewith shall be deemed to be €170,000,000 (or the equivalent amount in Dollars)) as of the Closing Date, (iv) Debt arising from Investments among the Borrower and its Subsidiaries that are permitted hereunder, (v) Debt in respect of any overdrafts and related liabilities arising from treasury, depository and cash management services or in connection with any automated clearing house transfers of funds; (vi) Debt consisting of guaranties (x) permitted by Section 5.02(c) and (y) non-recourse Debt in respect of Investments in joint ventures permitted under Section 5.02(f)(ix) or Section 5.02(f)(xvii) in an aggregate amount not to exceed $100,000,000 plus any non-recourse Debt directly associated with Dxxx Xxxx at any time outstanding; (vii) Debt of Foreign Subsidiaries owing to third parties in an aggregate outstanding principal amount (together with the aggregate outstanding principal amount of all other Debt of Foreign Subsidiaries permitted under this subSection (b)) not in excess of $500,000,000 at any time outstanding, (viii) Debt constituting purchase money debt and Capitalized Lease obligations (not otherwise included in subclause (iii) above and including any such Debt or Capitalized Lease obligations assumed in connection with a Permitted Acquisition) in an aggregate outstanding amount not in excess of $75,000,000, (ix)(x) Debt in respect of Hedge Agreements designed entered into in the ordinary course of business to hedge protect against fluctuations in interest rates, foreign exchange rates and commodity prices and (y) Debt arising under the Credit Card Program; provided that Hedge Agreements and Credit Card Programs subject to Liens permitted under Section 5.02(a)(vi)(x) shall not exceed $75,000,000 at any time outstanding, (x) indebtedness which may be deemed to exist pursuant to any surety bonds, appeal bonds or similar obligations incurred in connection with any judgment not constituting an Event of Default, (xi) indebtedness in respect of netting services, customary overdraft protections and otherwise in connection with deposit accounts in the ordinary course of business, (xii) payables owing to suppliers in connection with the Tooling Program, (xiii) Debt representing deferred compensation to employees of the Borrower or any other Loan Party incurred in the ordinary course of business and consistent with prudent business practice with business; (xiv) Debt incurred by the aggregate Agreement Value thereof Borrower or any of its Subsidiaries in a Permitted Acquisition, any other Investment expressly permitted hereunder or any Disposition, in each case limited to indemnification obligations or obligations in respect of purchase price, including Earn-Out Obligations or similar adjustments, (xv) Debt consisting of the financing of insurance premiums in each case, in the ordinary course of business, (xvi) Debt supported by a Letter of Credit in a principal amount not to exceed $2,500,000 at any time outstanding; (ii) in the case face amount of Holdingsuch Letter of Credit, (Axvii) Subordinated Debt under of the Loan Documents, (B) Debt Parties in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 250,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (Fxviii) Debt (other than Debt comprised not otherwise permitted hereunder in an aggregate outstanding principal amount of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02$20,000,000.

Debt. CreateThe Borrower shall not, incureither directly or indirectly, assume create, assume, incur or suffer to existhave outstanding any Debt (including purchase money indebtedness), or permit become liable, whether as endorser, guarantor, surety or otherwise, for any debt or obligation of its any other Person, except: (a) the Obligations under this Agreement and the other Loan Documents; (b) obligations of the Borrower for Taxes, assessments, municipal or other governmental charges; (c) obligations of the Borrower for accounts payable, other than for money borrowed, incurred in the ordinary course of business; (d) Debt of the Borrower to any domestic Restricted Subsidiary and Debt of Borrower to Unrestricted Subsidiaries in an amount not to createexceed Five Hundred Thousand and 00/100 Dollars ($500,000.00) in the aggregate, incuror Debt of any domestic Restricted Subsidiary to the Borrower or another domestic Restricted Subsidiary not to exceed Five Hundred Thousand and 00/100 Dollars ($500,000.00) in the aggregate; provided, assume in each case above, that, if requested by the Bank, such Debt shall be evidenced by a note in form and substance reasonably satisfactory to the Bank and pledged and delivered to the Bank pursuant to the Loan Documents as additional collateral security for the Obligations, and provided further that the obligations under any such note shall be Subordinated Debt; (e) that certain Unsecured Promissory Note dated March 9, 2005 made in the original principal amount of $2,650,000 by Borrower payable to Midwest Minerals, Inc.; (f) Hedging Obligations incurred in favor of the Bank or suffer to existan Affiliate thereof for bona fide hedging purposes and not for speculation; (g) Capitalized Lease Obligations, provided that the aggregate amount of all such Debt outstanding at any time shall not exceed [Five Hundred Thousand] and 00/100 Dollars ($500,000.00) in the aggregate; (h) Debt other than:for Capital Expenditures incurred after the date of this Agreement; (i) In Debt described on Schedule 9.1 and any extension, renewal or refinancing thereof so long as the case of principal amount thereof is not increased; (j) other unsecured subordinated Debt, in addition to the BorrowerDebt listed above, Debt in an aggregate amount outstanding at any time not to exceed One Million and 00/100 Dollars ($1,000,000.00); and (k) Contingent Liabilities (i) in respect of Hedge Agreements designed its Unrestricted Subsidiaries to hedge against fluctuations in interest rates the extent incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof for a face amount not to exceed exceed, in the aggregate, $2,500,000 at any time outstanding; 500,000, and (ii) in the case respect of Holding, (A) Debt under the Loan Documents, (B) Debt its Restricted Subsidiaries in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties500,000, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02aggregate.

Debt. Create, incur, assume or suffer to exist, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other than: (i) In the case of the Borrower, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstanding; (ii) in the case of Holding, (A) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 5,000,000 at any time issued pursuant outstanding to certain members of management of the Stockholders Agreement or an Employment Agreement Borrower in exchange for their equity ownership interests in Holding, provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) there is no amortization of such Debt is not required on or prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding;. (iiiii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000115,000,000; (iviii) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower, provided that any such Debt shall be (A) evidenced by a promissory note and (B) pledged in favor of the Lender Parties pursuant to the terms of the Security Agreement; and (viv) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 7,500,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 15,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing whether or other similar working capital financing) of any Person that becomes a Subsidiary not of the Borrower after the date hereof types described above in accordance with the terms of Section 5.02clauses (A) through (D)) in an aggregate principal amount not to exceed $3,750,000 at any time outstanding.

Debt. Create, incur, assume or suffer to exist, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanDebt, except: (ia) In the case Debt of the Borrower under this Agreement or the Notes; (b) Existing Debt set forth in the financial statements delivered to the Banks pursuant to Section 5.5, including Funded Debt described in Schedule 5.10 hereto, of the Borrower and its Subsidiaries, or in the financial statements delivered to the Administrative Agent and the Banks pursuant to Section 5.5, including renewals, extensions or refinancings thereof, provided that the principal amount of such Debt does not increase; (c) Debt of the Borrower which is subordinated to the Borrower's obligations under this Agreement and the Notes in a manner satisfactory in all respects to the Administrative Agent and the Banks in their sole and absolute discretion; (d) Debt of the Borrower to any Subsidiary or of any Subsidiary to the Borrower or another Subsidiary, provided, however, that the outstanding principal amount of any such Debt owing from any Subsidiary to the Borrower and/or another Subsidiary shall not exceed the aggregate of $7,500,000 (excluding management charges owed by any Subsidiary to the Borrower and excluding Debt incurred by any Subsidiary to the Borrower or another Subsidiary in connection with a Acceptable Acquisition) at any time, for each of the Subsidiaries or the Borrower; (e) Debt of the Borrower or any Subsidiary owing to any of the Banks in connection with any obligations related to hedging foreign currencies or other financial arrangements for the purpose of assuring against credit losses, including any Interest Rate Protection Agreement described in Section 2.15 and any contingent obligations, arising from swaps or swap agreements, derivatives, currency exchanges or similar exchange agreements and similar risk hedging agreements or transactions entered into by the Borrower or any of the Subsidiaries with any of the Banks; (f) Debt of the Borrower or any such Subsidiary secured by purchase money Liens permitted by Section 7.3; (g) Debt in respect of Hedge Agreements designed to hedge against fluctuations the undrawn portion of the face amount of letters of credit issued for the account of the Borrower or any of its Subsidiaries by any Bank, in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the an aggregate Agreement Value thereof amount not to exceed exceeding $2,500,000 at any time outstanding; (ii) in the case of Holding, (A) Debt under the Loan Documents, (Bh) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced nature of guarantees which are permitted by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by HoldingSection 7.2; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (ivi) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that which becomes a Subsidiary of the Borrower after in connection with an Acceptable Acquisition permitted by Section 7.11 or Debt which is acquired and assumed by the Borrower or any of its Subsidiaries in connection with an Acceptable Acquisition permitted by Section 7.11; provided that such Debt was in existence and outstanding prior to and on the date hereof that such Person became a Subsidiary or such Acceptable Acquisition was consummated, and suc Debt was not created in accordance contemplation of such Person becoming a Subsidiary or such Acceptable Acquisition being consummated, and any renewals, extensions or refinancings thereof, provided that the principal amount thereof does not increase; and provided, however, that the Debt permitted by this subclause (i) shall not include Funded Debt, together with commitments for Funded Debt, in excess of $5,000,000 (excluding permitted Debt pursuant to Section 7.1(a)) per Acceptable Acquisition or $10,000,000 (excluding permitted Debt pursuant to Section 7.1(a)) in the terms aggregate at any time that, in either case, (A) is in the nature of a line of credit, term loan facility, or other revolving credit facility (whether advanced or unadvanced) or (B) is secured by any type of blanket Lien on receivables, equipment, inventory, intellectual property and/or general intangibles (unless otherwise permitted by Section 5.027.3(k)); (j) [intentionally omitted]; (k) Debt of the Borrower secured by Liens pursuant to Sections 7.3 (b) - (g) and (l); and (l) other Debt not in excess of $5,000,000 in the aggregate at any one time.

Debt. Create, incur, assume Directly or suffer to exist, or permit any of its Subsidiaries to indirectly create, incur, assume assume, guaranty, or suffer otherwise become or remain directly or indirectly liable, on a fixed or contingent basis, with respect to exist, any Debt other than: except: (ia) In the case of the BorrowerObligation; (b) intercompany Debt among Borrowers, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstanding; business; (ii) in the case of Holding, (Ac) Debt under owing by SHS to the Loan Documents, (B) Debt Company or another Borrower in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that sum of (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (yi) the final maturity principal balance of such Debt is after as of the Termination Closing Date and (zii) amortization of such $1,500,000; (d) Debt is incurred after the Closing Date in connection with Capital Leases or purchases secured by purchase money Liens, in both cases together not required prior to exceed $5,000,000 in outstanding principal amount in the Termination Date, and aggregate; (Ce) Debt under the 13% Subordinated Notes due May 31Senior Loan Documents, 2009 issued by Holding; (iii) in but only to the case extent permitted under the terms of the Borrower Intercreditor Agreement; (f) Debt existing on the Closing Date and its Subsidiariesidentified on Schedule 11.1; (g) Debt incurred in connection with refinancing of those certain mortgages existing on the date hereof that encumber certain real property owned by the Borrowers on the date hereof, as set forth in Schedule 11.1, which Debt shall not exceed the Permanent principal balance secured by such mortgages on the Closing Date; (h) Debt incurred in an aggregate principal amount connection with the Sumitomo Transaction and the SunTrust Transaction; and (i) unsecured Indebtedness not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) 2,000,000 in outstanding principal amount in the case of the aggregate. No Borrower will, and will not permit any of its Subsidiaries, (A) Subsidiaries to, incur any Liabilities except Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred herein and trade payables and normal accruals in the ordinary course of business for not yet due and payable or with respect to which any Borrower or any of its Subsidiaries is contesting in good faith the deferred purchase price amount or validity thereof by appropriate proceedings and then only to the extent that such Borrower or any of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02its Subsidiaries has established adequate reserves therefor under GAAP.

Debt. Create, incur, assume or suffer to exist, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other than: (i) In in the case of the BorrowerBorrowers, (A) Debt of Uniroyal in respect of the Seoul Guaranty, provided that the US Dollar equivalent of the amount of such Debt shall not exceed US$5,000,000, (B) Debt in respect of Hedge non-speculative Interest Rate Swap Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice practice, (C) Debt in respect of non-speculative Foreign Exchange Agreements designed to hedge against fluctuations in foreign exchange rates incurred in the ordinary course of business and consistent with the aggregate Agreement Value thereof not prudent business practice, and (D) Debt owed to exceed $2,500,000 at any time outstanding;Crompton Corp. or to a wholly owned Subsidiary of Crompton Corp, (ii) in the case of Holding, (A) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Borrower's Subsidiaries (other than any Minor Subsidiary), Debt is after the Termination Date and (z) amortization owed to any Borrower or to a wholly owned Subsidiary of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding;any Borrower, (iii) in the case of the Borrower Crompton Corp. and its Domestic Subsidiaries, the Permanent Debt not otherwise permitted under this Section 5.02(b) in an aggregate principal amount not to exceed in the aggregate US$150,000,000 at any time outstanding, provided that, with respect to Debt of Uniroyal and its Domestic Subsidiaries under this clause (iii), such Debt shall not exceed $105,000,000;50,000,000 in the aggregate at any time outstanding, (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower Borrowers and their respective Subsidiaries (other than any of its SubsidiariesMinor Subsidiary except as provided below), (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv5.02(a)(iii) not to exceed in the aggregate $10,000,000 aggregate, together with Debt referred to in clause (C) below, US$100,000,000 at any time outstanding, (Ci) Capitalized Leases not to exceed in the aggregate $20,000,000 aggregate, together with Debt referred to in clause (B) above, US$100,000,000 at any time outstanding, outstanding and (Dii) unsecured Debt incurred in the ordinary course case of business for Capitalized Leases to which any Subsidiary of any Borrower is a party, Debt of such Borrower of the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, type described in clause (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financingi) of any Person that becomes a the definition of "Debt" guaranteeing the Obligations of such Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02under such Capitalized Leases,

Debt. CreateNeither the Borrower, the Guarantor, nor any Restricted Subsidiary shall incur, create, assume or suffer permit to exist, or permit exist any Debt of any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanthem except: (i) In the case of the Borrower, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstandingLoans; (ii) Debt secured by the Liens permitted by Section 5.02(d)(iii); provided that such Debt is discharged within 180 days of the relevant acquisition or merger; (iii) unsecured recourse liabilities (not in excess of the uncollectible amounts of the accounts receivable sold) arising from the sale of accounts receivable; (iv) unsecured loans and advances between the Restricted Subsidiaries, to any Restricted Subsidiary from the Borrower or the Guarantor, to the Borrower from any Restricted Subsidiary or the Guarantor and to the Guarantor from the Borrower or any Restricted Subsidiary; (v) purchase money Debt of the Borrower or the Guarantor secured by Liens referred to in Section 5.02(d)(ii) not in excess of the purchase price of the related asset in each individual case and not in excess of $15,000,000 principal amount for all such outstanding purchase money Debt in the case aggregate; (vi) unsecured Debt of Holdingthe Borrower or the Guarantor with a maturity less than 90 days pursuant to uncommitted lines of credit with an outstanding aggregate principal amount not at any time in excess of $10,000,000; (vii) additional Debt (including Guarantees of any Debt of a Third Party and Capitalized Lease Obligations) of the Borrower or the Guarantor with an outstanding aggregate principal amount not at any time in excess of $25,000,000 which shall, except for Liens of Capitalized Lease Obligations permitted by Section 5.02(d)(ii) or (Avi), be unsecured; (viii) additional Debt of the Borrower or the Guarantor fully subordinated to the Loans and the other obligations of the Borrower and the Guarantor under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant as applicable, on terms with respect to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms subordination and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such additional Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower approved by the Borrower or any other wholly-owned Subsidiary of the BorrowerAdministrative Agent; and (v) in the case of the Borrower and any of its Subsidiaries, (Aix) Debt under the Loan Documents, (B) Debt secured by Liens consisting of a pledge of investments in Nonrestricted Subsidiaries permitted by Section 5.02(a)(iv) not 5.02(d)(viii); provided that such Debt is recourse solely to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02investment so pledged.

Debt. Create, incur, assume or suffer to exist, or permit Permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanDebt, except: (i) In Debt under the case Loan Documents; (ii) Debt under the LC Facilities and in respect of the letters of credit referred to in Section 7.02(a)(vi) hereof; (iii) Debt existing on the Effective Date and described on Schedule XIII hereto; (iv) Debt of any Subsidiary of the Borrower which is not a Guarantor owed to any other such Subsidiary, and Debt of a Guarantor owed to the Borrower or any Subsidiary of the Borrower; (v) Debt incurred after the date of this Agreement and secured by Liens expressly permitted under Section 7.02(a)(ii) hereof in an aggregate principal amount not to exceed, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice when aggregated with the aggregate principal amount of all Debt incurred under clause (vi) of this Section 7.02(b), $50,000,000 any time outstanding; (vi) Capitalized Leases incurred after the date of this Agreement Value which, when the principal amount thereof is aggregated with the principal amount of all Debt incurred under clause (v) of this Section 7.02(b), do not to exceed $2,500,000 50,000,000 at any time outstanding; (iivii) in the case of Holding, (AUnsecured Debt not otherwise permitted under this Section 7.02(b) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 200,000,000 at any time outstanding,; (Cviii) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement Endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and; (Fix) Debt referred to in Section 7.02(a)(iii) hereof in a principal amount not in excess of the amount referred to therein; (other than x) Debt comprised of senior bank financing extending the maturity of, or other similar working capital financingrefunding, refinancing or replacing, in whole or in part, any Debt incurred under clause (iii) of this Section 7.02(b); provided, however, that (A) the aggregate principal amount of such extended, refunding, refinancing or replacement Debt shall not be increased above the principal amount thereof and the premium, if any, thereon outstanding immediately prior to such extension, refunding, refinancing or replacement, (B) the direct and contingent obligors therefor shall not be changed as a result of or in connection with such extension, refunding, refinancing or replacement if such change would be adverse to the interests of the Borrower, (C) such extended, refunding, refinancing or replacement Debt shall not mature prior to the stated maturity date or mandatory redemption date of the Debt being so extended, refunded, refinanced or replaced, and (D) if the Debt being so extended, refunded, refinanced or replaced is subordinated in right of payment or otherwise to the Obligations or any Person that becomes of the Borrower's Subsidiaries under and in respect of the Loan Documents, such extended, refunding, refinancing or replacement Debt shall be subordinated to such Obligations to at least the same extent; (xi) Guarantees by a Guarantor of Debt of another Guarantor permitted hereunder or Guarantees by a Subsidiary of the Borrower after which is not a Guarantor of Debt permitted hereunder of a Guarantor or of another such Subsidiary; and (xii) Debt of any Subsidiary of the date hereof Borrower which is not a Guarantor owed to the Borrower or a Guarantor in accordance an outstanding principal amount, when combined with the terms aggregate purchase price of securities and dollar amount of capital contributions made pursuant to Section 5.027.02(d)(ii) hereof, not in excess of the then applicable limitation on Investments in such Section.

Debt. Create, incur, assume or suffer to exist, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other than: (i) In Debt under the case of the Borrower, Loan Documents; (ii) unsecured Debt in with respect of to Hedge Agreements designed to hedge against fluctuations in interest rates incurred entered into in the ordinary course of business for the purpose of hedging underlying interest rate or foreign currency exposures of the Borrower and consistent with prudent business practice with its Subsidiaries; (iii) unsecured Debt of the Borrower to any Guarantor Subsidiary or of any Guarantor Subsidiary to the Borrower or any other Guarantor Subsidiary; (iv) unsecured Debt of the Borrower to BC Insurance Company, Inc.; and unsecured Debt of the Borrower to its Non-Guarantor Subsidiaries (other than BC Insurance Company, Inc.) in an aggregate Agreement Value thereof principal amount not to exceed $2,500,000 25,000,000 outstanding at any time outstandingtime; (iiv) unsecured Debt of any Non-Guarantor Subsidiary to any other Non-Guarantor Subsidiary; (vi) unsecured Debt of Non-Guarantor Subsidiaries to the Borrower and Guarantor Subsidiaries in an aggregate principal amount for all such Non-Guarantor Subsidiaries not to exceed $10,000,000 outstanding at any time; (vii) unsecured Debt arising by reason of endorsement of negotiable instruments for deposits or collection or similar transactions in the case ordinary course of Holding, business; (Aviii) Debt under the Loan Documents, secured by Liens permitted by Section 5.02(a)(iii) and (Biv) Debt in an aggregate principal amount not to exceed $10,000,000 outstanding at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holdingtime; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (Dix) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or servicesservices (other than trade payables), maturing within one year from the date created, in an aggregate principal amount for the Borrower and aggregatingits Subsidiaries not to exceed $10,000,000 outstanding at any time; (x) the Surviving Debt described in Schedule 3.01(c) and any refinancings or renewals of any such Surviving Debt, on a Consolidated basis, provided that the aggregate principal amount thereof is not increased by more than the sum of (A) accrued and unpaid interest on the obligations being refinanced or renewed, and (B) the amount of any normal and customary costs, fees and expenses payable by the Borrower or any of its Subsidiaries in connection with such refinancing or renewal, so long as such costs, fees and expenses are not paid to any Affiliate of the Borrower or any of its Subsidiaries; (xi) unsecured Debt evidenced by the Existing Senior Debentures in an aggregate principal amount not to exceed $7,500,000 100,000,000, and any unsecured guarantees of any Senior Notes (or any other Debt of the Borrower permitted under clause (xvi) below) by the Guarantor Subsidiaries; (xii) additional unsecured Debt of any Non-Guarantor Subsidiary to a Person other than the Borrower or another Subsidiary of the Borrower in an aggregate principal amount for each such Subsidiary not to exceed $30,000,000 outstanding at any time, provided that the aggregate principal amount of Debt permitted by this clause (xii) shall not exceed $75,000,000 at any one time outstanding,outstanding for all Non-Guarantor Subsidiaries taken as a whole, and provided further, that for purposes of this clause (xii), the net amount received by Foreign Subsidiaries from time to time from sales of assets pursuant Section 5.02(d)(vi) shall be deemed to be outstanding Debt of Non-Guarantor Subsidiaries; (Exiii) indorsement unsecured guarantees by the Borrower of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (FA) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) obligations of any Person that becomes a Subsidiary of the Borrower after permitted by clause (xv) below, (B) any Debt permitted by clause (xii) above, (C) the date hereof obligations of any Subsidiary of the Borrower in accordance with respect of any Surviving Debt and any refinancings or renewals thereof permitted by clause (x) above, and (D) loans or advances permitted under Section 5.02(e)(vi); and unsecured guarantees by the terms Company of obligations of its Subsidiaries described in clauses (A) and (C) above or obligations described in clause (D) above, in each case to the extent such guarantees were issued prior to the Closing Date; (xiv) unsecured Debt of the Borrower under the Mellon Facility in an aggregate principal amount not to exceed $30,000,000 outstanding at any time; (xv) obligations of the Borrower or any Subsidiary of the Borrower in respect of letters of credit, bank guarantees, and performance and bid bonds to secure obligations described in Section 5.025.02(a)(vi) or in respect of bankers' acceptances described in Section 5.02(a)(x) or trade letters of credit described in Section 5.02(a)(xi); (xvi) unsecured Debt (including Qualified Preferred Stock and New Senior Notes) issued or incurred by the Borrower to pay or prepay any Advances outstanding under this Agreement (or, in the case of the New Senior Notes, to redeem Existing Senior Debentures in an aggregate amount not to exceed the Tender Offer Reserve), provided that such Debt does not require any payment or prepayment of principal prior to the Termination Date;

Debt. Create, incur, assume or suffer to exist, or permit any of its Ongoing Subsidiaries to create, incur, assume or suffer to exist, any Debt other than: (i) In in the case of the Borrower, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstanding; (ii) in the case of HoldingParent Guarantors, (A) Debt under listed on Schedule 5.02(b)(i)(A) in an amount for each item of Debt on such Schedule not to exceed the Loan Documents, amount listed for such Debt on such Schedule and (B) Debt listed on Schedule 5.02(b)(i)(B) in an aggregate principal amount for each item of Debt on such Schedule not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) amount listed for such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents debt on terms and conditions reasonably satisfactory to the Lender Partiessuch Schedule, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (vii) in the case of the Borrower and any of its Ongoing Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) in respect of Hedge Agreements designed to hedge against fluctuations in interest rates or foreign exchange rates incurred in the ordinary course of business and consistent with prudent business practice in an aggregate notional amount not to exceed in the aggregate $10,000,000 100,000,000 for interest rate Hedge Agreements at any time outstanding, (C) Capitalized Leases not to exceed in Leases, so long as the aggregate $20,000,000 principal amount of such Capitalized Leases outstanding at any time outstandingplus the aggregate principal amount of Liens permitted pursuant to Section 5.02(a)(v) outstanding at any time shall not exceed $20,000,000, (D) unsecured Debt assumed or incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstandingconnection with Capital Expenditures secured by Liens permitted by Section 5.02(a)(v), (E) Unsecured Debt in an aggregate amount not to exceed $3,000,000, (F) Debt set forth on Schedule 5.02 (b)(ii)(F), (G) The 12.125% Notes, until such time as such 12.125% Notes shall be fully redeemed or repurchased pursuant to the 12.125% Note Indenture, so long as such 12.125% Notes remain defeased pursuant to such Indenture, and (iii) in the case of MEDIQ and any of its Ongoing Subsidiaries, (A) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, (B) any Guaranty of Obligations under the Loan Documents, (C) unsecured Debt (other than for the Borrower and its Ongoing Subsidiaries) in an aggregate amount not to exceed $250,000, and (FD) Debt any indemnities (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of given by the Borrower after and its Ongoing Subsidiaries) in connection with Permitted Asset Sales so long as such indemnities are generally customary for such transactions, and (E) any indemnities in connection with amounts owed by Borrower to Congress Financial Corporation pursuant to the date hereof Congress Agreement; (iv) in accordance the case of Holdings, any indemnities in connection with amounts owed by Borrower to Congress Financial Corporation pursuant to the terms of Section 5.02Congress Agreement.

Debt. CreateNeither the Borrower nor any Subsidiary will incur, incurcreate, assume or suffer permit to existexist any Debt, except (with respect to the Borrower and any Active Subsidiary): (a) the Notes or other Obligations or any guaranty of or suretyship arrangement for the Notes or other Obligations (provided, however, that nothing contained herein shall prohibit any Inactive Subsidiary from executing a guaranty of, or permit any of its Subsidiaries to createentering a suretyship arrangement for, incur, assume the Notes or suffer to exist, any Debt other than:Obligations); (ib) In the case Debt of the BorrowerBorrower or a Subsidiary (other than Southern G) existing on the Closing Date which is reflected in the Financial Statements or is disclosed in Schedule 9.01, Debt in respect and any renewals or extensions (but not increases) thereof; (c) accounts payable (for the deferred purchase price of Hedge Agreements designed Property or services), amounts owed to hedge against fluctuations in interest rates operators of the Hydrocarbon Interests under applicable joint operating agreements or other extensions of credit from suppliers or contractors from time to time incurred in the ordinary course of business which, if greater than 90 days past the invoice or billing date, are being contested in good faith by appropriate proceedings if reserves adequate under GAAP shall have been established therefor; (d) purchase money Debt of the Borrower or any Active Subsidiary and consistent with prudent business practice with Debt under capital leases (as required to be reported on the aggregate Agreement Value thereof financial statements of the Borrower or any Active Subsidiary pursuant to GAAP) not to exceed $2,500,000 at any time outstanding5,000,000.00 in the aggregate; (ii) in the case of Holding, (Ae) Debt under associated with bonds or surety obligations required by Governmental Requirements in connection with the Loan Documentsoperation of the Oil and Gas Properties, (B) Debt in an aggregate principal amount not to exceed $10,000,000 in the aggregate; (f) Debt of the Borrower and its Active Subsidiaries under Hedging Agreements, but only if (i) such Hedging Agreement is not a speculative hedge and is otherwise permitted under Section 9.28; (ii) the provider of the Hedging Agreements is a Lender or an Affiliate of a Lender or an unsecured counterparty acceptable to the Agent; (g) Debt among the Borrower and its Active Subsidiaries, or among the Active Subsidiaries, in each case to the extent permitted under Section 9.03(g), in the form of intercompany advances not evidenced by notes or other instruments, in each case as long as such Active Subsidiary is a Guarantor under this Agreement; (h) Accrued FAS 143 asset retirement obligations; (i) Revenue suspense accounts with respect to the Borrower's or any Active Subsidiary's Hydrocarbon Interests; (j) Debt not otherwise permitted under this Section 9.01, which does not exceed at any time issued an aggregate principal amount of $10,000,000.00; and (k) Debt incurred by the Borrower pursuant to the Stockholders Second Lien Loan Agreement and any guarantees thereof by any of the Guarantors; provided that, unless otherwise consented to by all of the Lenders, (i) the aggregate principal amount of such Debt shall not exceed an amount equal to $150,000,000.00 less any prepayments of principal made with respect thereto (provided, however, that nothing contained herein shall be construed to permit any payment or an Employment Agreement provided that prepayment of such Debt which is prohibited under Section 9.29 of this Agreement), (wii) the maturity date of any debt due thereunder shall be at least twelve months following the Revolving Credit Termination Date, (iii) such Debt is evidenced by a promissory note in substantially and the form of Exhibit B holders thereof shall at all times be subject to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms Intercreditor Agreement, and conditions reasonably satisfactory to the Lender Parties, (xiv) such Debt shall not bear interest on a cash basis have any principal amortization prior to the Revolving Credit Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02.

Debt. Create, incur, assume or suffer to exist, or permit any of ---- its Subsidiaries to create, incur, assume or suffer to exist, any Debt other than: (i) In in the case of the Parent Borrower, , (A) Debt in respect of Hedge Agreements with one or more Secured Parties designed to hedge against fluctuations in interest rates or foreign exchange rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 __________ at any time outstanding;, (iiB) Subordinated Debt in an aggregate amount not to exceed $__________ at any time outstanding issued or incurred to finance, in whole or in part, any acquisition under Section 5.02(f)(viii) which Debt has been issued to the case seller of Holdingthe company or business being acquired at the time of such acquisition; provided, however, that such Debt shall be -------- ------- subordinated to the Obligations of the Loan Parties under the Loan Documents on terms and conditions satisfactory to the Administrative Agent, (C) Debt owed to a wholly owned Subsidiary of the Parent Borrower (other than the Sub Borrower), so long as no Default shall have occurred and be continuing at the time of issuance or incurrence of such Debt or would result therefrom and which Debt (x) shall constitute Pledged Debt, (Ay) shall be on terms acceptable to the Administrative Agent and (z) shall be evidenced by promissory notes in form and substance satisfactory to the Administrative Agent and such promissory notes shall be pledged as security for the Obligations under the Loan Documents of the holder thereof and delivered to the Administrative Agent pursuant to the terms of the Security Agreement, (D) Debt under the Loan Documents, (B) Debt Senior Notes Indenture in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note 180,000,000 in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Partiesoriginal issue amount, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (DE) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, aggregating not more than $7,500,000 5,000,000 at any one time outstanding, (Eii) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course case of businessthe Parent Borrower's Subsidiaries, (A) in the case of the U.K. Subsidiaries, Debt owed to the Sub Borrower; provided that, in each case, such Debt (w) -------- shall constitute Pledged Debt (as defined in the Security Agreement), (x) shall be on terms acceptable to the Administrative Agent, (y) shall be evidenced by promissory notes in substantially the form of Exhibit I-1 hereto, such promissory notes shall be secured by the personal property, and such other property as the Administrative shall require from time to time, of the makers thereof and such promissory notes shall be pledged as security for the Obligations under the Loan Documents to which the holder thereof is a party and delivered to the Administrative Agent pursuant to the terms of the Security Agreement and Section 5.01(o) and (z) the Obligations of the U.K. Subsidiaries under such promissory notes shall be guaranteed by the Foreign Guarantors pursuant to the Foreign Guaranty, and (FB) Debt in the case of any of the Subsidiaries of the Parent Borrower (other than the Sub Borrower and any Excluded Subsidiary), Debt comprised of senior bank financing owed to the Parent Borrower or other similar working capital financing) of any Person that becomes to a wholly-owned Subsidiary of the Parent Borrower after (other than the date hereof Sub Borrower and any Excluded Subsidiary); provided -------- that, in accordance with each case, such Debt (x) shall constitute Pledged Debt (as defined in the terms of Section 5.02Security Agreement),

Debt. CreateThe Borrowers will not, incurand will not permit any of their respective Subsidiaries to, assume or suffer to exist, incur or permit to exist any Debt, except: (a) Debt outstanding under this Agreement, Debt outstanding under the Existing Revolving Credit Facility (including reimbursement obligations under the Existing Revolving Credit Facility Letters of Credit), and Debt issued pursuant to any Equity-Preferred Securities (to the extent the same constitutes Debt) in each case not in default, as well as (i) Debt of Panhandle Eastern and/or any of its Subsidiaries outstanding as of the Existing Revolving Credit Facility Closing Date, (ii) any Panhandle Eastern Refinancing Debt, (iii) any working capital credit facility or facilities provided directly to createPanhandle Eastern and/or any of Panhandle Eastern’s Subsidiaries by any party other than the Parent, incurso long as the principal amount of all such outstanding working capital facilities, assume together with the outstanding principal amount of any working capital loans or suffer advances by the Parent to existPanhandle Eastern and/or any of Panhandle Eastern’s Subsidiaries, does not exceed (A) $50,000,000 in the aggregate at any Debt time that the ratio of Consolidated Total Indebtedness to Consolidated Total Capitalization for Panhandle Eastern and Panhandle Eastern’s Subsidiaries (excluding the Parent and all other than:Subsidiaries of the Parent for purposes of such calculation) is greater than 0.65 to 1.00 and (B) $75,000,000 in the aggregate at any time that the ratio of Consolidated Total Indebtedness to Consolidated Total Capitalization for Panhandle Eastern and Panhandle Eastern’s Subsidiaries (excluding the Parent and all other Subsidiaries of the Parent for purposes of such calculation) is less than or equal to 0.65 to 1.00, and (iv) any loans or advances by the Parent to Panhandle Eastern and/or any of the Parent’s other Subsidiaries permitted under Section 10.4(b); (ib) In Debt of any Subsidiary of the Parent to the Parent or any other Subsidiary of the Parent, except to the extent limited by the terms of Section 10.4(b), and Debt of the Parent to any Subsidiary of the Parent; (c) Debt existing as of September 30, 2005 as reflected on financial statements delivered under Section 7.2(b) and refinancings thereof and, in the case of the Borrower2008 Senior Notes, any remarketings thereof in accordance with the terms of the 2003 Supplemental Indenture, other than Debt in respect that has been refinanced by the proceeds of Hedge Agreements designed to hedge against fluctuations in interest rates incurred loans under the Existing Revolving Credit Facility; (d) endorsements in the ordinary course of business and consistent with prudent business practice with of negotiable instruments in the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstandingcourse of collection; (e) Debt of the Parent or any of its Subsidiaries representing the portion of the purchase price of property acquired by the Parent or such Subsidiary that is secured by Liens permitted by the provisions of Section 10.2(d); provided, however, that at no time may the aggregate principal amount of such Debt outstanding exceed thirty percent (30%) of the Consolidated Net Worth of the Parent and its Subsidiaries as of the applicable determination date; (f) Debt evidenced by the Senior Notes; (g) additional Debt of the Parent and Structured Securities of the Parent and the Southern Union Trusts, provided that after giving effect to the issuance thereof, there shall exist no Default or Event of Default; and: (i) the ratio of Consolidated Total Indebtedness to Consolidated Total Capitalization shall be no greater than 0.70 to 1.00 at all times on or after the Closing Date; (ii) the ratio of EBDIT for the four fiscal quarters most recently ended to pro forma Cash Interest Expense for the following four fiscal quarters shall be no less than 2.00 to 1.0 at all times; provided, however, that if the additional Debt for which the determinations required to be made by this subparagraph (g) will be used to finance in whole or in part the case consideration to be paid by the Parent for the acquisition of Holdingany entity otherwise permitted under the terms of this Agreement, the determination of EBDIT for purposes of this ratio shall include not only the EBDIT of the Parent and its Subsidiaries for the four fiscal quarters most recently ended, but shall also include the EBDIT of such entity to be acquired for such four fiscal quarters most recently ended; and (iii) (A) such Debt under and Structured Securities shall have a final maturity or mandatory redemption date, as the Loan Documentscase may be, no earlier than the Maturity Date and shall mature or be subject to mandatory redemption or mandatory defeasance no earlier than the Maturity Date (as so extended) and shall be subject to no mandatory redemption or “put” to the Parent or any Southern Union Trust exercisable, or sinking fund or other similar mandatory principal payment provisions that require payments to be made toward principal, prior to the Maturity Date (as so extended); or (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such additional Debt shall not bear interest on have a cash basis final maturity date prior to the Termination Maturity Date, (y) such additional Debt shall not exceed Two Hundred Fifty Million Dollars ($250,000,000.00) in the final maturity aggregate plus Twenty Million Dollars ($20,000,000.00) of reimbursement obligations incurred in connection with Non-Revolving Credit Facility Letters of Credit issued by a Bank or Banks or by any other financial institution, and (z) such additional Debt shall be borrowed from a Bank or Banks as a loan or loans arising independent of this Agreement or shall be borrowed from a financial institution that is not a Bank under this Agreement; and (h) additional Debt of Trunkline LNG Holdings or any of its Subsidiaries, so long as (i) such Debt is to Trunkline LNG Holdings and/or any of its Subsidiaries only and is not recourse in any respect to the Parent or any other Subsidiary of the Parent (other than Panhandle Eastern and its Subsidiaries), (ii) the proceeds of such Debt is after the Termination Date and (z) amortization used solely to finance capital expenditures of such Debt is not required prior to the Termination DateTrunkline LNG Holdings and/or its Subsidiaries, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case after giving effect to such Debt, no Default or Event of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02Default shall exist.

Debt. CreateParent and Subsidiaries other than CAFS. Parent shall not, incur, assume or suffer to exist, or and shall not permit any of its Subsidiaries to (other than CAFS) to, create, incur, assume assume, become, or be liable in any manner in respect of, or suffer to exist, any Debt, except (a) Debt under the Loan Papers, (b) Funded Debt under each Note Purchase Agreement and guaranties of such Debt made by Parent and Subsidiaries of Parent, (c) other than: (i) In the case of the Borrower, Debt in respect existence on the date hereof, as shown on Schedule 4.08-a, (d) purchase money Debt incurred for the acquisition of Hedge Agreements designed to hedge against fluctuations tangible assets, provided the aggregate principal amount of such Debt incurred in interest rates any fiscal year shall not exceed $1,000,000, (e) trade payables incurred and paid in the ordinary course of business business, (f) Contingent Liabilities under or relating to the Loan Papers, (g) Contingent Liabilities in existence on the date hereof, as shown on Schedule 4.08-a, (h) guarantees by Parent and consistent with prudent business practice with its Subsidiaries (other than CAFS) of obligations in respect of Interest Hedge Agreements permitted under Section 5.19, (i) Debt of each Subsidiary of Parent (other than CAFS) to Parent or to another Subsidiary of Parent, (j) Contingent Liabilities resulting from the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstanding; (ii) endorsement of negotiable instruments for collection in the case ordinary course of Holdingbusiness, (Ak) Debt under the Loan Documents, (B) Convertible Subordinated Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties$25,000,000, (xl) such Debt shall not bear interest as to Parent and its Subsidiaries (other than CAFS) on a cash basis prior consolidated basis, other Debt not to exceed at any time, in the Termination aggregate principal amount, the difference between (i) $10,000,000, minus (ii) the sum of all Attributable Debt in respect of all Sale and Leasebacks occurring on and after the Effective Date, (ym) renewals and restatements of any Debt described in Sections 5.07(a) through (l), provided the final maturity principal amount of the Debt renewed or restated does not exceed the principal amount of such Debt is after the Termination Date and (z) amortization of such Debt is not required immediately prior to the Termination Datesuch renewal or restatement, and (Cn) as to Parent, only, its obligations under the CAFS Guaranty. (i) Section 5.09 is amended by deleting "and" immediately preceding "(k)" and by adding the following immediately preceding the period: , and (l) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not CAFS payable to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens Cameron permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.025.20(b).

Debt. Create, incur, assume or suffer to existexist any Debt, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanexcept: (ia) In Obligations under this Agreement and the case other Loan Documents; (b) Debt secured by Liens permitted by Sections 7.02(d), 7.02(h) and 7.02(j), and extensions, renewals and refinancings thereof; provided that the aggregate amount of all such Debt at any time outstanding shall not exceed $25,000,000; (c) Debt of a Co-Borrower to any domestic Wholly-Owned Subsidiary or Debt of any Wholly-Owned Subsidiary to a Co-Borrower or to a domestic Wholly-Owned Subsidiary; provided that such Debt shall be evidenced by a demand note in form and substance reasonably satisfactory to the Administrative Agent and pledged and delivered to the Administrative Agent pursuant to the Collateral Documents as additional collateral security for the Obligations, and the obligations under such demand note shall be subordinated to the Obligations of the BorrowerCo-Borrowers hereunder in a manner reasonably satisfactory to the Administrative Agent; (d) Subordinated Debt; (e) Hedging Obligations approved by Administrative Agent and incurred in favor of a Lender or an Affiliate thereof for bona fide hedging purposes and not for speculation; (f) Debt described on Schedule 7.01 and any extension, renewal or refinancing thereof so long as the principal amount thereof is not increased; (g) Debt in respect of Hedge Agreements designed secured obligations pursuant to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof one or more Factoring Facilities, not to exceed $2,500,000 30,000,000 in the aggregate amount at any one time outstanding; (h) Debt assumed in connection with Acquisitions permitted under Section 7.05 not to exceed $15,000,000 at any time outstanding; (ii) in the case of Holding, (Ai) Debt consisting of seller financing incurred in connection with Acquisitions permitted under the Loan Documents, (B) Debt in an aggregate principal amount Section 7.05 not to exceed $10,000,000 15,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holdingoutstanding; (iiij) in Debt incurred by a Co-Borrower or any Subsidiaries arising from agreements providing for indemnification, adjustment of purchase price, earn-outs or similar obligations, or from guaranties or letters of credit, surety bonds or performance bonds securing the case performance of the such Co-Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not or any such Subsidiary pursuant to exceed $105,000,000such agreements; (ivk) Debt owed to the Borrower guaranties by any whollyCo-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the BorrowerDebt of any other Co-Borrower or any Subsidiary with respect to, in each case, Debt otherwise permitted to be incurred pursuant to this Section 7.01; and (vl) so long as there exists no Default before and immediately after giving effect to the incurrence of any such Debt, other unsecured Debt, in addition to the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) listed above, in an aggregate outstanding amount not to exceed in the aggregate $10,000,000 at any time outstanding,exceeding $25,000,000. (Cg) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary Section 7.03 of the Borrower after the date hereof in accordance with the terms of Section 5.02Credit Agreement is hereby amended to read as follows:

Debt. CreateNot, incur, assume or and not suffer to exist, or permit any of its Subsidiaries to Loan Party or any other Subsidiary, to, create, incur, assume or suffer to existexist any Debt, any Debt other thanexcept: (ia) In Obligations under this Agreement and the case of the Borrower, other Loan Documents; (b) Debt in respect of Hedge Agreements designed to hedge against fluctuations Capital Leases and purchase money Debt, in interest rates each case incurred in the ordinary course of business and consistent with prudent business practice with for the purpose of financing all or any part of the cost of acquiring, repair, construction or improvement of fixed or capital assets; provided that (i) the aggregate Agreement Value thereof not to exceed $2,500,000 principal amount of all such Debt at any time outstandingoutstanding shall not exceed $2,750,000 and (ii) the principal amount of such Debt does not exceed the lower of the cost or fair market value of the property so acquired or built or of such repairs or improvements financed with such Debt (each measured at the time of such acquisition, repair, improvement or construction is made; (c) Debt existing as of the Closing Date and described in Section 7.1 of the Disclosure Letter and any Refinancing thereof (other than the (i) Biotest Obligations and (ii) in the case of Holding, (A) Debt outstanding under the Existing Loan Documents, Facility which shall be paid in full on the Closing Date from the proceeds of Loan A and Loan B ); (Bd) Debt Biotest Obligations in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant 15,000,000, plus accrued interest thereon that is paid-in-kind and added to the Stockholders Agreement principal balance thereof in accordance with the terms of the Biotest Debt Documents, and any Refinancing thereof so long as concurrently with the closing of any such Refinancing the lenders or an Employment Agreement provided that investors (w) such Debt is evidenced by or any agent with the power to enter into a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents binding obligation on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity behalf of such Debt is after the Termination Date and (zlenders or investors) amortization in respect of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by HoldingRefinancing enter into a Subordination Agreement; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (ive) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year arising from the date createdhonoring by a bank or other financial institution of a check, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection draft or similar transactions instrument drawn against insufficient funds in the ordinary course of business, provided that such Debt is extinguished within two (2) Business Days of notice to the Borrower or the relevant Subsidiary of its incurrence. (f) unsecured Debt to trade creditors incurred in the ordinary course of business; (g) Debt incurred as a result of endorsing negotiable instruments received in the ordinary course of business; (h) Debt incurred in connection with cash management services, including treasury, depository, overdraft, credit or debit card, purchasing cards, electronic funds transfer, automatic clearing house arrangements, cash pooling arrangements, netting services, merchant services and other similar arrangements of Borrower or any Subsidiary, in each case in the ordinary course of business; (i) Debt owed to any Person providing worker’s compensation, health, disability or other employee benefits or property, casualty, liability, or other insurance to Borrower or any of its Subsidiaries, so long as the amount of such Debt is not in excess of the amount of the unpaid cost of, and shall be incurred only to defer the cost of, such insurance for the year in which such Debt is incurred and such Debt is outstanding only during such year; and (Fj) Debt (other than Debt comprised incurred in connection with letters of senior bank financing credit that are secured solely by cash or other similar working capital financing) of any Person that becomes a Subsidiary cash equivalents and issued on behalf of the Borrower after the date hereof borrower in accordance with the terms of Section 5.02an aggregate amount outstanding not to exceed $250,000 at any given time.

Debt. CreateThe Borrower shall not, incureither directly or indirectly, assume create, assume, incur or suffer to existhave outstanding any Debt (including purchase money indebtedness), or permit become liable, whether as endorser, guarantor, surety or otherwise, for any debt or obligation of its Subsidiaries to createany other Person, incur, assume or suffer to exist, any Debt other thanexcept: (ia) In the case Obligations under this Agreement and the other Loan Documents; (b) obligations of the BorrowerBorrower for Taxes, Debt in respect assessments, municipal or other governmental charges; (c) obligations of Hedge Agreements designed to hedge against fluctuations in interest rates the Borrower for accounts payable, other than for money borrowed, incurred in the ordinary course of business business; (d) Subordinated Debt; (e) Hedging Obligations incurred in favor of the Bank or an Affiliate thereof for bona fide hedging purposes and consistent with prudent business practice with not for speculation; (f) Capitalized Lease Obligations, provided that the aggregate amount of all such Debt outstanding at any time shall not exceed, in the aggregate, Five Hundred Thousand and 00/100 Dollars ($500,000.00) plus the amount of any Capitalized Lease Obligations owing by the Borrower to Green Wing for so long as the Green Wing lease remains subject to an enforceable Subordination Agreement; (g) Debt for Capital Expenditures (other than Capitalized Lease Obligations permitted by Section 9.1(f) and purchase money indebtedness secured by vehicles permitted by Section 9.1(h)) incurred after the date of this Agreement Value thereof not to exceed Five Hundred Thousand and 00/100 Dollars ($2,500,000 at 500,000.00) in the aggregate in any time outstandingone fiscal year; (ii) in the case of Holding, (Ah) Debt under the Loan Documents, (B) Debt for purchase money indebtedness secured by vehicles in an aggregate principal amount not to exceed Five Hundred Thousand and 00/100 Dollars ($10,000,000 500,000.00) in the aggregate at any time. (i) Debt described on Schedule 7.26 and any extension, renewal or refinancing thereof so long as the principal amount thereof is not increased; (j) other unsecured Subordinated Debt, in addition to the Debt listed above, in an aggregate amount outstanding at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed Two Hundred Fifty Thousand and 00/100 Dollars ($105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02250,000.00).

Debt. Create, incur, assume (i) Create or suffer to existexist any Debt if, immediately after giving effect to such Debt and the receipt and application of any proceeds thereof, the aggregate amount of Debt of the Borrower and its consolidated Subsidiaries, on a consolidated basis, would exceed (A) for the period from the Effective Date through the date eighteen months thereafter, 75%, and (B) at anytime thereafter, 65%, of the sum of the total consolidated stockholders' equity of the Borrower and its Subsidiaries as shown on the most recent consolidated balance sheet required to be delivered to the Banks pursuant to Section 5.01(b), and the aggregate amount of Debt of the Borrower and its consolidated Subsidiaries, on a consolidated basis (it being understood that for purposes of determining compliance with this covenant, guarantees by the Borrower of up to $200,000,000 of Debt of OCI Wyoming shall not constitute Debt of the Borrower); (ii) not permit the Acquisition Subsidiary, Norcen or any of their respective Subsidiaries (collectively, the "Designated Subsidiaries") to incur any Debt which would result in the aggregate principal amount of Debt (other than Debt to the Borrower or any other Subsidiary) of all the Designated Subsidiaries, on a consolidated basis, exceeding US$1,400,000,000; and (iii) not permit any of its Subsidiaries (other than the Designated Subsidiaries) to create, incur, assume or suffer to exist, incur any Debt other than: (i) In the case of the Borrower, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred which would result in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstanding; (ii) in the case of Holding, (A) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not of Debt (other than Debt to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary Subsidiary) of all Subsidiaries (other than the Borrower; and (v) in the case of the Borrower and any of its Designated Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating), on a Consolidated consolidated basis, not more than $7,500,000 at any one time outstanding,exceeding US$150,000,000. (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of SECTION 5. Amendment to Section 5.02(e). Section ---------------------------- 5.02

Debt. CreateContract, incur, assume or suffer to exist, or permit any of its Subsidiaries to create, incur, assume or suffer to existexist any Debt, or permit any Debt other than: of its Material Subsidiaries to contract, create, incur, assume or suffer to exist any Debt, except for (i) In Debt under this Agreement and the other Loan Documents, (ii) Debt under the Revolving Facility Credit Agreement and other Revolving Facility Loan Documents, (iii) Surviving Debt (including the Existing Receivables Facility) and any Permitted Refinancing thereof (it being understood that in the case of a Permitted Refinancing of the BorrowerExisting Receivables Facility, the aggregate principal amount of such Debt being refinanced in connection therewith shall be deemed to be €170,000,000 (or the equivalent amount in Dollars)) as of the Closing Date, (iv) Debt arising from Investments among the Borrower and its Subsidiaries that are permitted hereunder, (v) Debt in respect of any overdrafts and related liabilities arising from treasury, depository and cash management services or in connection with any automated clearing house transfers of funds; (vi) Debt consisting of guaranties (x) permitted by Section 5.02(c) and (y) non-recourse Debt in respect of Investments in joint ventures permitted under Section 5.02(f)(ix) or Section 5.02(f)(xvii) in an aggregate amount not to exceed $100,000,000 plus any non-recourse Debt directly associated with Dxxx Xxxx at any time outstanding; (vii) Debt of Foreign Subsidiaries owing to third parties in an aggregate outstanding principal amount (together with the aggregate outstanding principal amount of all other Debt of Foreign Subsidiaries permitted under this subSection (b)) not in excess of $500,000,000 at any time outstanding, (viii) Debt constituting purchase money debt and Capitalized Lease obligations (not otherwise included in subclause (iii) above and including any such Debt or Capitalized Lease obligations assumed in connection with a Permitted Acquisition) in an aggregate outstanding amount not in excess of $75,000,000, (ix) (x) Debt in respect of Hedge Agreements designed entered into in the ordinary course of business to hedge protect against fluctuations in interest rates, foreign exchange rates and commodity prices and (y) Debt arising under the Credit Card Program; provided that Hedge Agreements and Credit Card Programs subject to Liens permitted under Section 5.02(a)(vi)(x) shall not exceed $75,000,000 at any time outstanding, (x) indebtedness which may be deemed to exist pursuant to any surety bonds, appeal bonds or similar obligations incurred in connection with any judgment not constituting an Event of Default, (xi) indebtedness in respect of netting services, customary overdraft protections and otherwise in connection with deposit accounts in the ordinary course of business, (xii) payables owing to suppliers in connection with the Tooling Program, (xiii) Debt representing deferred compensation to employees of the Borrower or any other Loan Party incurred in the ordinary course of business and consistent with prudent business practice with business; (xiv) Debt incurred by the aggregate Agreement Value thereof Borrower or any of its Subsidiaries in a Permitted Acquisition, any other Investment expressly permitted hereunder or any Disposition, in each case limited to indemnification obligations or obligations in respect of purchase price, including Earn-Out Obligations or similar adjustments, (xv) Debt consisting of the financing of insurance premiums in each case, in the ordinary course of business, (xvi) Debt supported by a “Letter of Credit” (as defined in the Revolving Facility Credit Agreement) in a principal amount not to exceed $2,500,000 at any time outstanding; the face amount of such “Letter of Credit” (ii) as defined in the case of HoldingRevolving Facility Credit Agreement), (Axvii) Subordinated Debt under of the Loan Documents, (B) Debt Parties in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 250,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (Fxviii) Debt (other than Debt comprised not otherwise permitted hereunder in an aggregate outstanding principal amount of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02$20,000,000.

Debt. CreateContract, incurcreate, incur or assume or suffer to existany Debt, or permit any of its Material Subsidiaries to contract, create, incur, or assume or suffer to existany Debt, any Debt other than:except for (i) In Debt under this Agreement and the case other Loan Documents; (ii) (x) Surviving Debt and any Permitted Refinancing thereof, (y) Debt in respect of any Qualified Receivables Transaction that is without recourse to any Borrower or any Restricted Subsidiary (other than a Receivables Entity and its assets and, as to any Borrower or any Restricted Subsidiary, other than pursuant to Standard Receivables Undertakings) and is not guaranteed by any such Person and (z) Debt in respect of any Permitted Factoring Transaction; (iii) Debt arising from Investments among Xxxx and its Restricted Subsidiaries that are permitted hereunder; (iv) Debt in respect of any overdrafts and related liabilities arising from treasury, depository and cash management services or in connection with any automated clearing house transfers of funds; (v) (i) guarantees of Debt otherwise permitted under this Agreement and (ii) guarantees and non-recourse Debt in respect of Investments in joint ventures permitted under Sections 5.02(e)(ix), (xiv), (xix) or (xxvi); provided that the Borroweraggregate principal amount outstanding of such Debt does not exceed the greater of $200,000,000 and 3.0% of Total Assets; (vi) Debt of Foreign Subsidiaries in an aggregate principal amount outstanding not to exceed the greater of $600,000,000 and 15.0% of Total Foreign Assets; (vii) Debt constituting (i) Sale and Leaseback Transactions and (ii) purchase money debt and Capitalized Lease obligations (and, in each case, any Permitted Refinancing thereof); provided that, at the time of incurrence of such Debt and after giving pro forma effect thereto, the aggregate principal amount outstanding of such obligations does not exceed the greater of $300,000,000400,000,000 and 4.55.5% of Total Assets; (viii) (x) Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred entered into in the ordinary course of business to protect against fluctuations in interest rates, foreign exchange rates and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstanding; (ii) in the case of Holding, (A) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Datecommodity prices, (y) Debt arising under the final maturity of such Debt is after the Termination Date Credit Card Program and (z) amortization of such Debt is not required prior permitted pursuant to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by HoldingSection 5.02(a)(vi)(z); (iiiix) indebtedness which may be deemed to exist pursuant to any surety bonds, appeal bonds or similar obligations incurred in the case connection with any judgment not constituting an Event of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000Default; (ivx) Debt owed to the Borrower by any wholly-owned Subsidiary indebtedness in respect of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or netting services, maturing within one year from the date created, customary overdraft protections and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for otherwise in connection with deposit or collection or similar transactions accounts in the ordinary course of business, and; (Fxi) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof payables owing to suppliers in accordance connection with the terms of Section 5.02Tooling Program,

Debt. CreateThe Borrower will not, incurand will not permit any Subsidiary to, assume incur or suffer permit to existexist any Debt, except: (a) Debt evidenced by the Notes or the Facility Letter of Credit Obligations, or permit outstanding under any Equity-Preferred Securities (to the extent the same constitutes Debt) not in default, as well as (i) Debt of Panhandle Eastern and/or any of its Subsidiaries, so long as (A) such Debt is otherwise permitted under Section 10.03(g) and (B) after giving effect to the issuance of such Debt, the ratio of Consolidated Total Indebtedness to Consolidated Total Capitalization for Panhandle Eastern and Panhandle Eastern’s Subsidiaries (excluding the Borrower and all other Subsidiaries of the Borrower for purposes of such calculation) is no greater than 0.70 to create1.00, incur, assume and (ii) any loans or suffer advances by the Borrower to exist, Panhandle Eastern and/or any Debt other than: (i) In the case of the Borrower’s other Subsidiaries permitted under Section 10.04(b); (b) Debt of any Subsidiary to the Borrower or any other Subsidiary, except to the extent limited by the terms of Section 10.04(b), and Debt in respect of Hedge Agreements designed the Borrower to hedge against fluctuations in interest rates incurred any Subsidiary; (c) Debt existing as of December 31, 2010 as reflected on financial statements delivered under Section 7.02(a) and refinancings thereof other than Debt that has been refinanced by the proceeds of Loans; (d) endorsements in the ordinary course of business and consistent with prudent business practice with of negotiable instruments in the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstandingcourse of collection; (ii) in the case of Holding, (Ae) Debt under of the Loan DocumentsBorrower or any Subsidiary representing the portion of the purchase price of property acquired by the Borrower or such Subsidiary that is secured by Liens permitted by the provisions of Section 10.02(d); provided, (B) Debt in an however, that at no time may the aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after outstanding exceed thirty percent (30%) of the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case Consolidated Net Worth of the Borrower and its Subsidiaries, Subsidiaries as of the Permanent Debt in an aggregate principal amount not to exceed $105,000,000applicable determination date; (f) Debt evidenced by Senior Notes; (g) additional Debt of the Borrower, and additional Debt of Panhandle Eastern and/or any of Panhandle Eastern’s Subsidiaries (so long as such additional Debt of Panhandle Eastern and/or any of Panhandle Eastern’s Subsidiaries is otherwise permitted under Section 10.03(a)), provided that after giving effect to the issuance thereof, (i) there shall exist no Default or Event of Default; (ii) the ratio of Consolidated Total Indebtedness to Consolidated Total Capitalization shall be no greater than 0.65 to 1.00 at all times; (iii) the ratio of EBDIT for the four fiscal quarters most recently ended to pro forma Cash Interest Expense for the following four fiscal quarters shall be no less than 2.00 to 1.0 at all times; and (iv) (A) such Debt owed shall have a final maturity or mandatory redemption date, as the case may be, no earlier than the Maturity Date and shall mature or be subject to mandatory redemption or mandatory defeasance no earlier than the Maturity Date (as so extended) and shall be subject to no mandatory redemption or “put” to the Borrower exercisable, or sinking fund or other similar mandatory principal payment provisions that require payments to be made toward principal, prior to such Maturity Date (as so extended); or (B) (x) such additional Debt shall have a final maturity date prior to the Maturity Date, and (y) such additional Debt shall not exceed $350,000,000 in the aggregate plus $20,000,000 of reimbursement obligations incurred in connection with Non-Facility Letters of Credit issued by a Bank or Banks or by any wholly-owned Subsidiary other financial institution; (h) additional Debt of the Borrower Trunkline LNG Holdings or any of its Subsidiaries, so long as (i) such Debt owed is to a wholly-owned Subsidiary Trunkline LNG Holdings and/or any of the Borrower by its Subsidiaries only and is not recourse in any respect to the Borrower or any other wholly-owned Subsidiary of the BorrowerBorrower (other than Panhandle Eastern and its Subsidiaries), (ii) the proceeds of such Debt is used solely to finance capital expenditures of Trunkline LNG Holdings and/or its Subsidiaries, and (iii) after giving effect to such Debt, no Default or Event of Default shall exist; and (v) in the case of the Borrower and any of its Subsidiaries, (Ai) Debt arising under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, Receivables Purchase and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02Sale Agreement.

Debt. Create, incur, assume or suffer to exist, or permit any of its Subsidiaries to create, incur, assume or suffer to existexist any Debt, any Debt other thanexcept: (ia) In Debt described in Schedule 9.01, including renewals, extensions or refinancings thereof, provided that the case of the Borrower, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value principal amount thereof does not to exceed $2,500,000 at any time outstandingincrease; (iib) in other Debt of the case Company subordinated on terms satisfactory to the Lenders to the Company's obligations under this Agreement and the Notes, the Letters of Holding, (A) Debt under the Loan Documents, (B) Debt Credit and Letter of Credit Agreements and any other Security Instrument in an aggregate principal amount not to exceed $10,000,000 at any one time issued pursuant outstanding; (c) Debt of the Company to the Stockholders Agreement any Guarantor or an Employment Agreement provided that (w) such Debt is evidenced by any other Subsidiary which becomes a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis Guarantor prior to the Termination Date, (y) the final maturity incurrence of such Debt, and Debt is after of any Guarantor or any such Subsidiary to the Termination Date and Company or to any other Guarantor or any such Subsidiary; (zd) amortization Debt of such Debt is not required the Company to any Subsidiary (other than a Guarantor or any Subsidiary which becomes a Guarantor prior to the Termination Date, and incurrence of such Debt) or Debt of any Subsidiary (Cother than a Guarantor or any Subsidiary which becomes a Guarantor prior to the incurrence of such Debt) Debt under to the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt Company in an aggregate principal amount not to exceed exceeding $105,000,0005,000,000 at any one time outstanding; (ive) Debt owed accounts payable (other than for borrowed money) to the Borrower by any wholly-owned Subsidiary of the Borrower trade creditors for goods or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt services incurred in the ordinary course of business and which are not in excess of 30 days past the due date, or, if greater than 30 days past due, are being contested in good faith and by appropriate proceedings; (f) Debt of the Company and any Subsidiary (other than newly-formed single purpose entity Subsidiaries created specifically for the deferred purpose of investing in project finance transactions) incurred to purchase price or to finance the purchase of, fixed assets in an aggregate principal amount not exceeding as to the Company and its Subsidiaries $25,000,000 at any time outstanding; (g) Debt of property the Company incurred in the ordinary course of business in connection with performance bonds required of operators by the Minerals Management Service or services, maturing within one year from other state or governmental agencies which the date created, Company is required to post in connection with its activities as operator of Oil and aggregating, on a Consolidated basis, not more than Gas Properties up to the aggregate amount of $7,500,000 25,000,000 at any one time outstanding,; provided, however, any outstanding utilization of performance bonds in excess of $5,000,000 shall reduce the availability on a dollor-for-dollar revolving basis of Revolving Credit Loans pursuant to Section 2.01(a); -49- (Eh) indorsement Debt of negotiable instruments for deposit the Company in respect of judgment liens excepted under Section 9.03; (i) Debt of the Company and its Subsidiaries under Capital Leases (and any extensions or collection renewals thereof or similar transactions substitutions therefor) which do not in the ordinary course aggregate require the Company and its Subsidiaries on a consolidated basis to make payments (including, without limitation, rent, taxes, insurance, maintenance and similar expense which the Company or any Subsidiary is required to pay under the terms of businessany Capital Lease) in any calendar year in excess of $2,000,000; (j) Debt of the Company under or in respect of the Indenture and the Senior Subordinated Notes issued thereunder, and all amendments, supplements, renewals, extensions or refinancings thereof; provided, however, that (i) the aggregate principal amount of the Senior Subordinated Notes shall not exceed $100,000,000, (ii) payment of principal of, premium, if any, interest and other amounts owing or to be owing under, in connection with or evidenced by the Indenture or the Senior Subordinated Notes shall be subordinated to the payment of the Indebtedness on terms set forth therein as of the Closing Date or otherwise reasonably satisfactory to the Administrative Agent, and (iii) any amendment, supplement, renewal, extension or refinancing of the Indenture or any Senior Subordinated Notes shall be on terms no more restrictive to the Company than the terms of the Indenture and the Senior Subordinated Notes as they exist on the Closing Date, provided, however, with respect to subclause (ii) hereof, the Indenture and the Senior Subordinated Notes may be prepaid with net proceeds of an equity offering, provided, further, however, if any refinancing of the Debt of the Company under or in respect of the Indenture or any Senior Subordinated Note permitted by the terms of this Agreement or results in the Company receiving net proceeds in excess of the aggregate principal amount of the Senior Subordinated Notes outstanding on the Closing Date, the Borrowing Base shall be redetermined in accordance with Section 2.09; (k) Debt of the Company in connection with the Letters of Credit listed on Schedule 1.02(b); and (Fl) Debt (other than Debt comprised of senior bank financing the Notes or other similar working capital financing) Indebtedness or any guaranty of any Person that becomes a Subsidiary of or suretyship arrangement for the Borrower after the date hereof in accordance with the terms of Section 5.02Notes or other Indebtedness.

Debt. Create, incur, assume or suffer to existexist any Debt, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanexcept: (ia) In Debt created under the case Loan Documents; SECOND AMENDED AND RESTATED ABL CREDIT AGREEMENT (b) Guaranteed Debt of Navistar International in respect of Debt under the 2009 Senior Note Indenture governing the 8.25% Senior Notes due November 1, 2021 and any Permitted Additional Senior Notes, in an aggregate principal amount for all such Debt not to exceed $1,450,000,000, and (ii) any refunding, refinancing, restructuring, renewal or replacement, in whole or in part, of such Debt; provided, that the Refinancing Conditions are satisfied; (c) other Existing Debt, and any Debt extending the maturity of, or refunding, replacing, restructuring, renewal or refinancing, in whole or in part, any Existing Debt; provided, that the Refinancing Conditions are satisfied; (d) Debt secured by Liens permitted by Section 6.02(d); provided that the aggregate outstanding principal amount of all such Debt, together with the aggregate amount of Capital Lease Obligations permitted under Section 6.01(e), shall not exceed at any time the greater of (x) $100,000,000 and (y) 2% of the BorrowerConsolidated Net Tangible Assets at the time of the incurrence thereof; provided, further, that the aggregate outstanding principal amount of all such Debt secured by Liens upon or in PMSI Inventory permitted by Section 6.02(d) shall not exceed $30,000,000 at any time; (e) Capital Lease Obligations; provided that the aggregate outstanding principal amount of all such Capital Lease Obligations, together with the aggregate amount of Debt permitted under Section 6.01(d), shall not exceed at any time the greater of (x) $100,000,000 and (y) 2% of the Consolidated Net Tangible Assets at the time of the incurrence thereof; (f) Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof practice; (g) intercompany Debt between Borrower and/or a Restricted Subsidiary of Navistar International; (h) Subordinated Debt; (i) other Debt not to exceed in the aggregate $2,500,000 200,000,000 at any time outstanding; (iij) Guaranteed Debt of Borrower with respect to (x) obligations of NFC under the Receivables Facility and (y) obligations with respect to Navistar International’s financial service operations in Mexico; provided that the case aggregate amount of Holding, all such Guaranteed Debt shall not exceed $112,000,000 at any time outstanding; (Ak) Debt under the Loan Documents, Master Intercompany Agreements and the Support Agreement; (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (Cl) Debt under the 13% Subordinated Notes due May 31, 2009 issued by HoldingPermitted Receivables Financings; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (ivm) Debt owed incurred by Borrower constituting reimbursement obligations with respect to the Borrower by any wholly-owned Subsidiary letters of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions credit issued in the ordinary course of business, including, without limitation, letters of credit in response to worker’s compensation claims or self-insurance; (n) Debt arising from agreements of Borrower providing for adjustment of purchase price, earn-out or other similar obligations, in each case, incurred or assumed in connection with any acquisition permitted under Section 6.06; SECOND AMENDED AND RESTATED ABL CREDIT AGREEMENT (o) obligations in respect of performance and surety bonds and completion guarantees provided by Borrower in respect of obligations arising in the ordinary course of business and not constituting Debt for Borrowed Money; (p) Debt consisting of notes issued to current or former employees, officers or directors in connection with the redemption or repurchase of Equity Interests held by such Persons in an aggregate amount not in excess of $10,000,000 at any time outstanding; (q) Debt consisting of take-or-pay obligations contained in supply agreements entered into by Borrower in the ordinary course of business; (r) Debt in respect of any Sale/Leaseback Transaction with respect to the purchase of tooling and related manufacturing equipment in the ordinary course of business; (i) Debt in respect of the Term Loan Documents and any amendments thereof permitted under the Loan Documents, in an aggregate principal amount for all such Debt not to exceed $1,050,000,000 at any time outstanding and (ii) any refunding, refinancing, restructuring, renewal or replacement, in whole or in part, of such Debt; provided that, in the case of any such refunding, refinancing, restructuring, renewal or replacement, the Refinancing Conditions are satisfied; (t) other Debt; provided that (i) no Default or Event of Default shall be continuing at the time of the incurrence thereof or result therefrom, (ii) in the case of secured Debt, entry into an intercreditor agreement in a form substantially similar to the Collateral Cooperation Agreement or in another form reasonably acceptable to the Administrative Agent, (iii) the collateral (if any) for such Debt shall not include any Borrowing Base Collateral and (iv) scheduled maturity of such Debt (or, in the case of Guaranteed Debt, the primary obligation in respect thereof) shall be beyond the Scheduled Maturity Date; (u) Investments to the extent constituting Debt (as defined in clause (i) or (j) in the definition of “Debt”); (v) Guarantees issued by Borrower in connection with Recovery Zone Bonds; and (Fw) Debt (other than Debt comprised Indebtedness of senior Borrower arising from the honoring by a bank financing or other financial institution of a check, draft or similar working capital financinginstrument inadvertently (except in the case of daylight overdrafts) drawn against insufficient funds in the ordinary course of any Person business; provided, however, that becomes a Subsidiary such Indebtedness is extinguished within five business days after incurrence. The accrual of interest and the Borrower after accretion or amortization of original issue discount on Debt and the date hereof payment of interest in the form of additional Debt originally incurred in accordance with the terms this Section 6.01 will not constitute an incurrence of Section 5.02Debt.

Debt. CreateNo Company will incur, incurcreate, assume or suffer permit to exist, and no Company will permit any Subsidiary to incur, create, assume, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other than: Debt, except (ia) In the case of the Borrower, Debt in respect of Hedge Agreements designed the Obligations and Debt in respect of any Incremental Facilities, (b) Debt arising from endorsing negotiable instruments for collection in the ordinary course of business, (c) purchase money Debt or Debt to hedge against fluctuations in interest rates provide the purchase price or cost of construction of an asset and Capital Lease Obligations incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof that do not to exceed $2,500,000 at any time outstanding; (ii) in the case of Holding, (A) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed 7,000,000 in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, , (Ed) indorsement Debt among the Loan Parties, (e) guaranties by any Loan Party of negotiable instruments for deposit or collection or similar transactions Permitted Debt, (f) indemnities and warranties arising under agreements entered into by any Loan Party in the ordinary course of business, and (Fg) trade payables and other current liabilities incurred in the ordinary course of business, (h) Tax liabilities, (i) any financed portion of the premium for any Loan Party’s insurance policies; provided that, such financed portion is paid within the required due dates, (j) Debt of a Loan Party in respect of performance bonds, bid bonds, appeal bonds, completion guaranties, surety bonds and similar obligations, in each case provided in the ordinary course of business, (other than k) Permitted Subordinated Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary and Permitted Unsecured Debt of the Borrower after and its Subsidiaries in an aggregate principal amount not in excess of $15,000,000 at any one time outstanding, (l) Debt in connection with a Sale and Leaseback Transaction to the date hereof extent permitted under Section 9.17, (m) Debt outstanding on the Closing Date and described on Schedule 9.1 and any Permitted Refinancing of such Debt, (n) Debt constituting Hedge Obligations under Hedge Agreements entered into in accordance the ordinary course of business and not for speculative purposes and permitted under Section 9.12, (o) other Debt not to exceed $5,000,000, (p) guaranties by any Loan Party with respect to obligations under check processing and cashing agreements in the terms ordinary course of Section 5.02the Loan Parties’ business and (q) Debt up to, but not to exceed, $5,000,000 in the aggregate at any one time outstanding, in the form of one or more letters of credit or letter of credit facilities (including the Existing Letters of Credit).

Debt. CreateNeither the Borrower nor any Subsidiary will incur, incurcreate, assume or suffer permit to existexist any Debt, except (with respect to the Borrower and any Active Subsidiary): (a) the Notes or other Obligations or any guaranty of or suretyship arrangement for the Notes or other Obligations (provided, however, that nothing contained herein shall prohibit any Inactive Subsidiary from executing a guaranty of, or permit any of its Subsidiaries to createentering a suretyship arrangement for, incur, assume the Notes or suffer to exist, any Debt other than:Obligations); (ib) In the case Debt of the BorrowerBorrower or a Subsidiary (other than Southern G) existing on the Closing Date which is reflected in the Financial Statements or is disclosed in Schedule 9.01, Debt in respect and any renewals or extensions (but not increases) thereof; (c) accounts payable (for the deferred purchase price of Hedge Agreements designed Property or services), amounts owed to hedge against fluctuations in interest rates operators of the Hydrocarbon Interests under applicable joint operating agreements or other extensions of credit from suppliers or contractors from time to time incurred in the ordinary course of business which, if greater than 90 days past the invoice or billing date, are being contested in good faith by appropriate proceedings if reserves adequate under GAAP shall have been established therefor; (d) purchase money Debt of the Borrower or any Active Subsidiary and consistent with prudent business practice with Debt under capital leases (as required to be reported on the aggregate Agreement Value thereof financial statements of the Borrower or any Active Subsidiary pursuant to GAAP) not to exceed $2,500,000 at any time outstanding5,000,000.00 in the aggregate; (ii) in the case of Holding, (Ae) Debt under associated with bonds or surety obligations required by Governmental Requirements in connection with the Loan Documentsoperation of the Oil and Gas Properties, (B) Debt in an aggregate principal amount not to exceed $10,000,000 in the aggregate; (f) Debt of the Borrower and its Active Subsidiaries under Hedging Agreements, but only if (i) such Hedging Agreement is not a speculative hedge and is otherwise permitted under Section 9.28; (ii) the provider of the Hedging Agreements is a Lender or an Affiliate of a Lender or an unsecured counterparty acceptable to the Agent; (g) Debt among the Borrower and its Active Subsidiaries, or among the Active Subsidiaries, in each case to the extent permitted under Section 9.03(g), in the form of intercompany advances not evidenced by notes or other instruments, in each case as long as such Active Subsidiary is a Guarantor under this Agreement; (h) Accrued FAS 143 asset retirement obligations; (i) Revenue suspense accounts with respect to the Borrower’s or any Active Subsidiary’s Hydrocarbon Interests; (j) Debt not otherwise permitted under this Section 9.01, which does not exceed at any time issued an aggregate principal amount of $10,000,000.00; and (k) Debt incurred by the Borrower pursuant to the Stockholders Second Lien Loan Agreement and any guarantees thereof by any of the Guarantors; provided that, unless otherwise consented to by all of the Lenders, (i) the aggregate principal amount of such Debt shall not exceed an amount equal to $150,000,000.00 less any prepayments of principal made with respect thereto (provided, however, that nothing contained herein shall be construed to permit any payment or an Employment Agreement provided that prepayment of such Debt which is prohibited under Section 9.29 of this Agreement), (wii) the maturity date of any debt due thereunder shall be at least twelve months following the Revolving Credit Termination Date, (iii) such Debt is evidenced by a promissory note in substantially and the form of Exhibit B holders thereof shall at all times be subject to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms Intercreditor Agreement, and conditions reasonably satisfactory to the Lender Parties, (xiv) such Debt shall not bear interest on a cash basis have any principal amortization prior to the Revolving Credit Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02.

Debt. Create, incur, assume or suffer to exist, or The Borrower will not permit any of its Subsidiaries Subsidiary to create, incur, assume assume, guarantee, otherwise become liable for or suffer to exist, any Debt other than: (i) In Debt under the case of Credit Documents; (ii) Debt existing on the Effective Date (such Debt, to the extent the principal amount thereof is $25,000,000 or more, being described on Schedule 4.01(r) attached hereto); (iii) Debt owing to the Borrower, any Subsidiary or any SPV; (iv) Debt in respect under any interest rate protection agreements or foreign exchange xxxxxx (regardless of Hedge Agreements designed whether such hedging obligations are subject to hedge against fluctuations in interest rates accounting) incurred in the ordinary course of business and consistent not for speculative purposes; (v) Debt (x) under unsecured overdraft lines of credit or for working capital purposes in foreign countries with prudent business practice with financial institutions and (y) arising from the aggregate Agreement Value thereof honoring by a bank or other Person of a check, draft or similar instrument inadvertently drawing against insufficient funds, all such Debt not to exceed $2,500,000 100,000,000 in the aggregate at any time outstanding; (iivi) Debt of a Person existing at the time such Person becomes a Subsidiary of the Borrower or is merged with or into the Borrower or any Subsidiary of the Borrower and not incurred in the case contemplation of Holding, such transaction; (Avii) Debt under performance guaranties and letters of credit issued in the Loan Documentsordinary course of business; (viii) Debt consisting of Pre-Completion Guaranties to the extent that the aggregate principal amount of the obligations guaranteed under such Pre-Completion Guaranties does not exceed $175,000,000 at any time outstanding; (ix) Debt incurred for the purpose of financing all or a part of the purchase price or construction cost of property (including the cost of upgrading, refurbishing, renovating or repairing drilling rigs, drillships and other vessels and platforms owned by the Borrower or any of its Subsidiaries) within the limitations of Section 5.02(c)(iv) above; (Bx) Debt in an aggregate principal amount outstanding at the time of incurrence thereof (together with all such other Debt outstanding pursuant to this clause (x) at such time) not to exceed $10,000,000 at 100,000,000 (the “Subsidiary Debt Basket Amount”); (xi) Debt not otherwise permitted under any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (wother clause of this Section 5.02(d) so long as each Subsidiary incurring such Debt is evidenced by has in force a promissory note Subsidiary Guaranty in substantially the form of Exhibit B G; provided that such Subsidiary Guaranty shall contain a provision that such Subsidiary Guaranty, and all obligations thereunder of the Guarantor party thereto, shall be terminated upon notice by the Borrower to the Stockholders Agreement or otherwise subordinated in right Administrative Agent that (a) the aggregate principal amount of payment Debt of all Subsidiaries outstanding pursuant to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, immediately preceding clause (x) such and this clause (xi) is equal to or less than the Subsidiary Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date Basket Amount and (zb) amortization no Default or Event of such Debt Default has occurred and is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holdingcontinuing; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (ivxii) Debt owed to the Borrower by any whollyof Subsidiaries (a) whose assets consist primarily of xxxx-up rigs owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other whollySubsidiary as of the Effective Date (or the capital stock of Subsidiaries whose assets consist primarily of xxxx-up rigs owned by the Borrower or any Subsidiary as of the Effective Date) and (b) all or a portion of the capital stock of which is intended to be distributed to the shareholders of the Borrower (such Subsidiaries being referred to as “Spin-off Subsidiaries”); provided that neither the Borrower nor any Subsidiary of the BorrowerBorrower (other than Spin-off Subsidiaries) shall have any liability in respect of such Debt; and (vxiii) extensions, refinancings, renewals or replacements of the Debt permitted above which, in the case of any such extension, refinancing, renewal or replacement, does not increase the Borrower and any amount of its Subsidiaries, (A) the Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property being extended, refinanced, renewed or servicesreplaced, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised amounts incurred to pay the costs of senior bank financing such extension, refinancing, renewal or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02replacement.

Debt. CreateThe Borrower will not, and will not permit any Subsidiary or Xxxxxx 2009 Partnership to, incur, create, assume or suffer to existexist any Debt, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanexcept: (ia) In the case of the Borrower, Notes and other Secured Obligations and any Permitted Refinancing Debt in respect thereof. (b) Debt of Hedge Agreements designed the Borrower and its Subsidiaries existing on the date hereof that is set forth on Schedule 9.02, and any Permitted Refinancing Debt in respect thereof. (c) Purchase money Debt and Debt under Capital Leases not to hedge against fluctuations exceed $5,000,000 in interest rates the aggregate at any time outstanding. (d) Debt associated with bonds or surety obligations required by Governmental Requirements in connection with the operation of the Oil and Gas Properties in an aggregate amount not to exceed $10,000,000 at any time outstanding. (e) intercompany Debt among the Loan Parties to the extent permitted by Section 9.05(g); provided that such Debt is not held, assigned, transferred, negotiated or pledged to any Person other than the Borrower or a Guarantor, and, provided further, that any such Debt owed by either the Borrower or a Guarantor shall be subordinated to the Secured Obligations on terms set forth in the Guarantee and Collateral Agreement. (f) endorsements of negotiable instruments for collection in the ordinary course of business. (g) so long as the Intercreditor Agreement has been duly executed by the parties thereto and delivered to the Administrative Agent, Debt under the First Lien Credit Agreement, the original principal amount of which does not exceed $100,000,000 in the aggregate, and under any guaranties thereof at any time outstanding, and any refinancing thereof permitted by the Intercreditor Agreement in an aggregate principal amount not to exceed $100,000,000; provided, however, that immediately before and after giving pro forma effect to each borrowing of First Lien Loans or making of any other credit extension thereunder (including without limitation any issuance of a letter of credit thereunder), the aggregate amount of Debt that has been funded thereunder (including without limitation, the face amount of any letters of credit issued thereunder), shall not exceed the least of (i) 30% of the NYMEX Value of the total Proved Reserves of the Loan Parties as shown on the most recently delivered Reserve Report (as adjusted to give effect to Dispositions, individually or in the aggregate, of 5.00% or more of Proved Reserves of the Loan Parties as shown on the most recently delivered Reserve Report) delivered prior to the date such Debt was incurred, (ii) the Borrowing Base as in effect on the date such Debt was incurred and (iii) $100,000,000. (h) insurance premiums incurred in the ordinary course of business and consistent with prudent business practice past practices if the amount financed does not exceed the premium payable for the current policy period. (i) Debt arising under Cash Management Agreements with any financial institution in which the Borrower or any of its Subsidiaries maintains a deposit account. (j) Debt existing on the date hereof under the Restructuring Agreement. (k) Debt constituting the deferred purchase price payable in connection with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstanding; (ii) Gunsight Acquisition in accordance with the case of HoldingGunsight Acquisition Agreement, (A) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that 950,000. (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (Cl) Debt under constituting the 13% Subordinated Notes due May 31deferred purchase price payable in connection with the Savant Acquisition in accordance with the Savant Acquisition Agreement, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000;9,000,000, as such amount may be reduced in accordance with the Savant Acquisition Agreement. (ivm) other Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed $5,000,000 in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02.

Debt. Create, incur, assume or suffer to exist, or permit Neither the Borrower nor any of its Subsidiaries to shall, either directly or indirectly, create, incurassume, assume incur or suffer to exist, have outstanding any Debt (including purchase money indebtedness), or become liable, whether as endorser, guarantor, surety or otherwise, for any debt or obligation of any other thanPerson, except: (ia) In the case of Obligations under this Agreement and the Borrowerother Loan Documents; (b) obligations for Taxes, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates assessments, municipal or other governmental charges; (c) obligations for accounts payable, other than for money borrowed, incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstandingbusiness; (ii) in the case of Holding, (Ad) Debt under of the Loan Documents, (B) Debt in an aggregate principal amount not Borrower to exceed $10,000,000 at any time issued pursuant Subsidiary Guarantor or of any Subsidiary Guarantor to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by HoldingBorrower; (iiie) Subordinated Debt; (f) Hedging Obligations incurred in favor of the case Bank or an Affiliate thereof for bona fide hedging purposes and not for speculation; (g) Capitalized Lease Obligations, provided that the aggregate amount of all such Debt outstanding at any time, combined with obligations of the Borrower and its SubsidiariesSubsidiaries for Operating Lease Expenses at such time, shall not exceed Five Million and 00/100 Dollars ($5,000,000.00) in the Permanent aggregate; (h) Debt in an aggregate principal amount for Capital Expenditures incurred after the date of this Agreement not to exceed Twenty-Three Million and 00/100 Dollars ($105,000,00023,000,000.00) in the aggregate in any one fiscal year; (ivi) provided such Debt owed to is indefeasibly paid and terminated on or before the Borrower by any wholly-owned Subsidiary date that is twenty (20) Business Days after the Closing Date, the "Revolving Loans" and the "Letter of Credit Borrowings" as such terms are defined in the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the BorrowerAmSouth Bank Credit Agreement; and (vj) in the case of the Borrower Debt described on Schedule 9.1(i) and any of its Subsidiaries, (A) Debt under extension, renewal or refinancing thereof so long as the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) principal amount thereof is not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02increased.

Debt. CreateThe Borrower will not, and will not permit any Restricted Subsidiary to, incur, create, assume or suffer to existexist any Debt, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanexcept: (ia) In the case Notes or other Indebtedness arising under the Loan Documents or any guaranty of or suretyship arrangement for the Borrower, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstanding; (ii) in the case of Holding, (A) Debt Notes or other Indebtedness arising under the Loan Documents, . (Bb) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, Restricted Subsidiaries existing on the Permanent date hereof that is reflected in the Financial Statements. (c) purchase money Debt in an aggregate principal amount and Debt under Capital Leases not to exceed $105,000,000;20,000,000 in the aggregate. (ivd) Debt owed to associated with workers’ compensation claims, performance, bid, surety or similar bonds or surety obligations required by Governmental Requirements or third parties in connection with the Borrower by any wholly-owned Subsidiary operation of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; andOil and Gas Properties. (ve) in the case of intercompany Debt between the Borrower and any Restricted Subsidiary or between Restricted Subsidiaries to the extent permitted by Section 9.05(g); provided that such Debt is not held, assigned, transferred, negotiated or pledged to any Person other than the Borrower or one of its Wholly-Owned Subsidiaries,, and, provided further, that any such Debt owed by either the Borrower or a Guarantor shall be subordinated to the Indebtedness on terms set forth in the Guaranty Agreement. (A) Debt under the Loan Documents, (Bf) Debt secured by Liens permitted by Section 5.02(a)(iv9.03(d) and Section 9.03(e), the principal amount of which does not to exceed $10,000,000 in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding,time. (Eg) indorsement endorsements of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and. (Fh) Debt under the Senior Notes and any guarantees thereof by the Guarantors, the principal amount of which does not exceed $250,000,000 in the aggregate. (other than i) Debt comprised under the Senior Subordinated Notes and any guarantees thereof by the Guarantors, the principal amount of senior bank financing which does not exceed $275,000,000 in the aggregate. (j) Debt outstanding under one or other similar working capital financingmore unsecured short term credit facilities the principal amount of which does not exceed $30,000,000 in the aggregate. (k) Debt under Permitted Additional Notes and any guarantees thereof by the Guarantors (including any Persons becoming Guarantors simultaneously with the incurrence of such Debt), provided that: (i) immediately before, and after giving effect to, the incurrence of any Person such Debt (and any concurrent repayment of Debt with the proceeds of such incurrence), no Default exists or would exist, (ii) the cash pay interest rate on such Permitted Additional Notes is reasonably satisfactory to the Administrative Agent, (iii) such Permitted Additional Notes do not have any scheduled amortization of principal prior to the Maturity Date, (iv) such Permitted Additional Notes have a stated maturity no earlier than five (5) years after the Maturity Date, (v) such Permitted Additional Notes do not have mandatory redemption events that becomes a Subsidiary are not Events of Default hereunder, (vi), such Permitted Additional Notes do not prohibit prior repayment of Loans, and (vii) at the time any such Permitted Additional Notes are issued or assumed, the Borrowing Base then in effect shall be automatically reduced by an amount equal to the product of 0.30 multiplied by the stated principal amount of such Permitted Additional Notes, rounded to the nearest $1,000,000, and the Borrowing Base as so reduced shall become the new Borrowing Base immediately upon the date of such issuance or assumption, effective and applicable to the Borrower, the Agents, each Issuing Bank and the Lenders on such date until the next redetermination or modification thereof hereunder. For purposes of this Section 9.02(k), the “stated principal amount” shall mean the stated face amount of the Borrower after Permitted Additional Notes without giving effect to any original issue discount. (l) other Debt not to exceed $25,000,000 in the date hereof in accordance with the terms of Section 5.02aggregate at any one time outstanding.

Debt. Create, incur, assume or suffer to exist, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other than: (i) In in the case of the Borrower, 140 110 (A) Debt owed to its Subsidiaries; so long as at the time of incurrence of such Debt, foreclosure proceedings shall not have been commenced with respect to any stock or assets of such Subsidiaries, (B) Debt in respect of Hedge Agreements not entered into for speculative purposes and designed to hedge against fluctuations in interest rates or foreign exchange rates incurred in the ordinary course of business and consistent with prudent business practice with practice, and (C) Debt in respect of guarantees by the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstanding;Borrower of the Obligations of Foreign Subsidiaries under bank overdraft facilities permitted under Section 5.02(b)(iii)(I) (ii) in the case of Holding, (A) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-or to a wholly owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrowerextent permitted under Section 5.02(f); and (viii) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents,. (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases in an aggregate amount, calculated in accordance with GAAP, not to exceed in the aggregate $20,000,000 10,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date createdSurviving Debt, and aggregatingany Debt extending the maturity of, on or refunding or refinancing, in whole or in part, any Surviving Debt, provided that the terms of any such extending, refunding or refinancing Debt, and of any agreement entered into and of any instrument issued in connection therewith, are otherwise permitted by the Loan Documents and provided further that the principal amount of such Surviving Debt shall not be increased above the principal amount thereof outstanding immediately prior to such extension, refunding or refinancing, and the direct and contingent obligors therefor shall not be changed, as a Consolidated basisresult of or in connection with such extension, refunding or refinancing, 141 111 (E) Subordinated Debt under the Subordinated Notes Indentures, (F) Debt of any Person that becomes a Subsidiary of the Borrower after the First Closing Date in accordance with the terms of Section 5.02(f) that is existing at the time such Person becomes a Subsidiary of the Borrower, (G) Debt in an aggregate principal amount not more than to exceed $7,500,000 5,000,000 outstanding at any one time and consisting of letters of credit (other than Letters of Credit issued hereunder) and reimbursement obligations in respect thereof, (H) other Debt in an aggregate amount not to exceed $5,000,000 at any time outstanding, (EI) indorsement in the case of Foreign Subsidiaries, Debt under bank overdraft facilities in an aggregate amount not to exceed $10,000,000 at any time outstanding; and (J) endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02.

Debt. CreateContract, incurcreate, incur or assume or suffer to existany Debt, or permit any of its Material Subsidiaries to contract, create, incur, or assume or suffer to existany Debt, any Debt other than:except for (i) In Debt under this Agreement and the case other Loan Documents; (ii) (x) Surviving Debt and any Permitted Refinancing thereof, (y) Debt in respect of any Qualified Receivables Transaction that is without recourse to any Borrower or any Restricted Subsidiary (other than a Receivables Entity and its assets and, as to any Borrower or any Restricted Subsidiary, other than pursuant to Standard Receivables Undertakings) and is not guaranteed by any such Person and (z) Debt in respect of any Permitted Factoring Transaction; (iii) Debt arising from Investments among Xxxx and its Restricted Subsidiaries that are permitted hereunder; (iv) Debt in respect of any overdrafts and related liabilities arising from treasury, depository and cash management services or in connection with any automated clearing house transfers of funds; (v) (i) guarantees of Debt otherwise permitted under this Agreement and (ii) guarantees and non-recourse Debt in respect of Investments in joint ventures permitted under Sections 5.02(e)(ix), (xiv), (xix) or (xxvi); provided that the Borroweraggregate principal amount outstanding of such Debt does not exceed the greater of $150,000,000200,000,000 and 3.0% of Total Assets; (vi) (x) during any period other than the period described in clause (y), Debt of Foreign Subsidiaries in an aggregate principal amount outstanding not to exceed the greater of $500,000,000600,000,000 and 15.0% of Total Foreign Assets and (y) solely during the Restricted Period, Debt of Foreign Subsidiaries in an aggregate principal amount not to exceed $350,000,000; (vii) Debt constituting (i) Sale and Leaseback Transactions and (ii) purchase money debt and Capitalized Lease obligations (and, in each case, any Permitted Refinancing thereof); provided that, at the time of incurrence of such Debt and after giving pro forma effect thereto, the aggregate principal amount outstanding of such obligations does not exceed the greater of $225,000,000300,000,000 and 4.5% of Total Assets; (viii) (x) Debt in respect of Hedge Agreements designed entered into in the ordinary course of business to hedge protect against fluctuations in interest rates, foreign exchange rates and commodity prices, (y) Debt arising under the Credit Card Program and (z) Debt permitted pursuant to Section 5.02(a)(vi)(z); (ix) indebtedness which may be deemed to exist pursuant to any surety bonds, appeal bonds or similar obligations incurred in connection with any judgment not constituting an Event of Default; (x) indebtedness in respect of netting services, customary overdraft protections and otherwise in connection with deposit accounts in the ordinary course of business; (xi) payables owing to suppliers in connection with the Tooling Program, (xii) Debt representing deferred compensation to employees of any Borrower or any other Loan Party incurred in the ordinary course of business business; (xiii) Debt incurred by any Borrower or any of its Restricted Subsidiaries in connection with a Permitted Acquisition, any other Investment expressly permitted hereunder or any disposition, in each case limited to indemnification obligations or obligations in respect of purchase price, including Earn-Out Obligations or similar adjustments; (xiv) Debt consisting of the financing of (A) insurance premiums or (B) take-or-pay obligations contained in supply arrangements, in each case in the ordinary course of business; (xv) Debt supported by a Letter of Credit in a principal amount not to exceed the face amount of such Letter of Credit; (xvi) (i) unsecured Debt (including Subordinated Debt) of the Loan Parties and consistent with prudent business practice their Restricted Subsidiaries provided that after giving pro forma effect thereto, the pro forma Total Net Leverage Ratio on a pro forma basis for the most recently ended period of four consecutive Fiscal Quarters of Xxxx for which financial statements are available, does not exceed 3.50:1.00 and (ii) any Permitted Refinancing thereof; provided, further that the aggregate principal amount of such Debt incurred by the Non-Loan Parties during the Restricted Period, together with the aggregate Agreement Value thereof principal amount of Debt incurred by the Non-Loan Parties during the Restricted Period pursuant to Section 5.02(b)(xxvi) and Section 5.02(b)(xvii), shall not to exceed $2,500,000 500,000,000 at any time outstanding; (iixvii) (x) during any period other than the period described in clause (y), (i) secured Debt of the case of Holding, Loan Parties and their Restricted Subsidiaries not otherwise permitted hereunder so long as after giving pro forma effect thereto (A) with respect to Liens that are pari passu with Liens of the Secured Parties on the Collateral, the First Lien Net Leverage Ratio on a pro forma basis for the most recently ended period of four consecutive Fiscal Quarters of Xxxx for which financial statements are available, does not exceed 1.50:1.00 and (B) if such Liens are junior to the Liens of the Secured Parties on the Collateral, the Senior Secured Net Leverage Ratio on a pro forma basis for the most recently ended period of four consecutive Fiscal Quarters of Xxxx for which financial statements are available, does not exceed 2.50:1.00 and (ii) any Permitted Refinancing thereof, and (y) solely during the Restricted Period (i) Debt of the Loan Parties and their Restricted Subsidiaries secured on the Collateral on a junior basis to the Obligations and not otherwise permitted hereunder so long as after giving pro forma effect thereto the Senior Secured Net Leverage Ratio on a pro forma basis for the most recently ended period of four consecutive Fiscal Quarters of Xxxx for which financial statements are available, does not exceed 2.50:1.00 and (ii) any Permitted Refinancing thereof; provided, further that the aggregate principal amount of such Debt incurred by the Non-Loan Parties during the Restricted Period, together with the aggregate principal amount of Debt incurred by the Non-Loan Parties during the Restricted Period pursuant to Section 5.02(b)(xxvi) and Section 5.02(b)(xvi), shall not exceed $500,000,000 at any time outstanding;; (xviii) Debt incurred in connection with the issuance of the Senior Notes (and any Permitted Refinancings thereof); (xix) (i) Debt assumed in connection with any Permitted Acquisition, provided that (1) such Debt was not incurred in contemplation of such Permitted Acquisition, (2) the only obligors with respect to any Debt incurred pursuant to this clause (xix) shall be those Persons who were obligors of such Debt prior to such Permitted Acquisition (and any other Person that would have been required to become an obligor under the Loan Documentsterms of such Debt), and (3) both immediately prior and after giving effect thereto, no Default shall exist or result therefrom and (ii) any Permitted Refinancing thereof; (xx) (x) during any period other than the period described in clause (y), (i) Debt incurred by Xxxx or any of its Restricted Subsidiaries to finance any Permitted Acquisition so long as after giving pro forma effect to the incurrence of such Debt (A) if such Debt is secured (1) the First Lien Net Leverage Ratio on a pro forma basis for the most recently ended period of four consecutive Fiscal Quarters of Xxxx for which financial statements are available, does not exceed 1.50:1.00 and (2) on a junior basis to the Liens of the Secured Parties on the Collateral, the Senior Secured Net Leverage Ratio on a pro forma basis for the most recently ended period of four consecutive Fiscal Quarters of Xxxx for which financial statements are available, does not exceed 2.50:1.00; and (B) if such Debt is not secured by a lien on the Collateral, the Total Net Leverage Ratio on a pro forma basis for the most recently ended period of four consecutive Fiscal Quarters of Xxxx for which financial statements are available, does not exceed 3.50:1.00; and (ii) any Permitted Refinancing thereof and (y) solely during the Restricted Period (i) unsecured Debt or Debt that is secured by the Collateral on a junior basis to the Liens of the Secured Parties on the Collateral incurred by Xxxx or any of its Restricted Subsidiaries to finance any Permitted Acquisition so long as after giving pro forma effect to the incurrence of such Debt (A) if such Debt is secured by the Collateral on a junior basis to the Liens of the Secured Parties on the Collateral, the Senior Secured Net Leverage Ratio on a pro forma basis for the most recently ended period of four consecutive Fiscal Quarters of Xxxx for which financial statements are available, does not exceed 2.50:1.00; and (B) if such Debt is unsecured, the Total Net Leverage Ratio on a pro forma basis for the most recently ended period of four consecutive Fiscal Quarters of Xxxx for which financial statements are available, does not exceed 3.50:1.00; and (ii) any Permitted Refinancing thereof;; (xxi) Debt owed to any person providing workers’ compensation, health, disability or other employee benefits or property, casualty or liability insurance to Xxxx or any Restricted Subsidiary, pursuant to reimbursement or indemnification obligations to such person, in each case in the ordinary course of business; (xxii) purchase price holdbacks arising in the ordinary course of business in respect of a portion of the purchase prices of an asset to satisfy unperformed obligations of the seller of such asset; (xxiii) Guarantees of Debt of suppliers, licensees, franchisees or customers in the ordinary course of business, in an aggregate principal amount at any time outstanding not to exceed $100,000,000the greater of $150,000,000 and 2.0% of Total Assets. (xxiv) Incremental Equivalent Debt (and Permitted Refinancings thereof) and (ii) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding 500,000,000 under the Loan Documents on terms Bridge Facility Agreement (and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by HoldingPermitted Refinancings thereof); (iiixxv) in the case Debt consisting of the Borrower Refinancing Facilities permitted under Section 2.20 and Permitted Refinancings thereof; and (xxvi) other Debt of Xxxx or its SubsidiariesRestricted Subsidiaries (including any Permitted Refinancing thereof), the Permanent Debt in an aggregate principal amount outstanding not to exceed the greater of $105,000,000; (iv) 375,000,000550,000,000 and 7.5% of Total Assets; provided that the aggregate principal amount of such Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower incurred by the Borrower or any other whollyNon-owned Subsidiary of Loan Parties during the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in Restricted Period, together with the aggregate principal amount of Debt incurred by the Non-Loan Parties during the Restricted Period pursuant to Section 5.02(b)(xvi) and Section 5.02(b)(xvii), shall not exceed $10,000,000 500,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02..

Debt. Create, incur, assume or suffer to existexist any Debt, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other thanexcept: (i) In the case of the Borrower, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstanding; (ii) in the case of Holding, (Aa) Debt under the Loan Documents, ; (Bb) Debt outstanding on the date hereof and listed on Schedule 7.03 and any refinancings, refundings, renewals or extensions thereof; provided that the amount of such Debt is not increased at the time of such refinancing, refunding, renewal or extension except by an amount equal to a reasonable premium or other reasonable amount paid, and fees and expenses reasonably incurred, in connection with such refinancing and by an amount equal to any existing commitments unutilized thereunder; (c) intercompany Debt owed between any Subsidiary of the Borrower and the Borrower, provided that the payment of such Debt is subordinated to the payment of the Obligations pursuant to Section 10.22 or otherwise in a manner satisfactory to the Administrative Agent; (d) Subordinated Debt in an aggregate principal amount not at any time to exceed $20,000,000; (e) so long as there exists no Default both before and after giving effect to any such transaction, obligations (contingent or otherwise) of the Borrower or any Subsidiary existing or arising under any Swap Contract, provided that (i) such obligations are (or were) entered into by such Person in the Ordinary Course of Business for the purpose of directly mitigating risks associated with liabilities, commitments, investments, assets, or property held or reasonably anticipated by such Person, or changes in the value of securities issued by such Person, and not for purposes of speculation or taking a “market view;” and (ii) such Swap Contract does not contain any provision exonerating the non-defaulting party from its obligation to make payments on outstanding transactions to the defaulting party; (f) Guarantee Obligations of the Borrower or any Guarantor in respect of Debt otherwise permitted hereunder of the Borrower or any other Guarantor, including the Senior Notes; (g) Debt consisting of the Deferred Purchase Price of any Acquisition permitted by this Agreement; (h) Debt incurred by the Borrower under the Senior Notes and the Senior Notes Documents and any Permitted Senior Notes Refinancing in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding;450,000,000; and (iiii) in the case so long as there exists no Default before or after giving effect thereto, Debt of the Borrower and its Subsidiaries, the Permanent Debt Guarantors not otherwise permitted pursuant to clauses (a) through (h) above in an aggregate principal amount not to exceed in excess of $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.0250,000,000.

Debt. Create, incur, assume or suffer to exist, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, exist any Debt other than: (i) In Debt incurred pursuant to this Agreement; (ii) unsecured Subordinated Debt and Permitted Subordinated Debt; (iii) accrued expenses, current trade payables and other current liabilities arising in the case ordinary course of business and not incurred through the borrowing of money; (iv) unsecured Debt (x) of any Subsidiary to the Borrower (y) of any Subsidiary to a Subsidiary and (z) of the BorrowerBorrower to any Subsidiary, provided that any such Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates under this clause (iv) is incurred in the ordinary course of business and consistent with prudent business past practice with and is evidenced by one or more promissory notes pledged to the aggregate Agreement Value thereof not Agent pursuant to exceed $2,500,000 at any time outstandingthe Security Agreements; (iiv) Contingent Obligations permitted by SECTION 6.4; (vi) other Consolidated Debt (including, without limitation, Debt secured by liens described in clauses (E) and (G) of the case definition of Holding, (APermitted Liens and Capital Lease Obligations) Debt under the Loan Documents, (B) Debt in an aggregate principal amount at any time outstanding not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of 20,000,000 for the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (vvii) in the case Debt of the Borrower and under any Interest Rate Protection Agreements (if any) entered into with one or more Lenders in respect of its Subsidiaries, (A) the Debt under incurred pursuant to this Agreement; provided that the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 notional amount of all such agreements at any time outstanding, (C) Capitalized Leases shall not to exceed in the aggregate $20,000,000 amount of the Commitments at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year such time. The Lenders shall use their best commercially reasonable efforts to respond to a request from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement Borrower for approval of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Subordinated Debt (other than Debt comprised of senior bank financing or other similar working capital financingon terms acceptable to the Required Lenders in their sole discretion) of any Person that becomes a Subsidiary of the Borrower within five (5) Business Days after the date hereof in accordance with Agent's and the Lender's receipt of information regarding the amount and material terms of Section 5.02thereof; provided, however, the failure to approve or disapprove such Subordinated Debt during such period shall not constitute approval.

Debt. Create, incur, assume or suffer to exist, or permit Neither the Borrower nor any of its Subsidiaries to createshall incur or maintain any Debt, incur, assume or suffer to exist, any Debt other than: : (a) the Obligations; (b) Debt described on Schedule 6.9; (c) Capital Leases of Equipment and purchase money secured Debt incurred to purchase Equipment provided that (i) In Liens securing the case same attach only to the Equipment acquired by the incurrence of such Debt, and (ii) the aggregate amount of such Debt (including Capital Leases) outstanding does not exceed $1,000,000 at any time; (d) Debt evidencing a refunding, renewal or extension of the Debt described on Schedule 6.9; provided that (i) the principal amount thereof is not increased, (ii) the Liens, if any, securing such refunded, renewed or extended Debt do not attach to any assets in addition to those assets, if any, securing the Debt to be refunded, renewed or extended, (iii) no Person that is not an obligor or guarantor of such Debt as of the Closing Date shall become an obligor or guarantor thereof, and (iv) the terms of such refunding, renewal or extension are no less favorable to the Borrower, Debt in respect the Agent or the Lenders than the original Debt; (e) Interest Rate Agreements required by Section 7.24; and (f) loans by a Borrower to another Borrower provided that such loans are evidenced by demand intercompany notes pledged to the Agent and subordinated to repayment of Hedge Agreements designed the Obligations on terms acceptable to hedge against fluctuations in interest rates incurred in the ordinary course Agent, and at the time of business the making of the loan (and consistent with prudent business practice with after giving effect thereto) each party is Solvent; and (g) loans to the aggregate Agreement Value thereof Borrower not to exceed $2,500,000 1,000,000 in the aggregate and secured only by the Denver Property, so long as (i) no Default or Event of Default exists at any the time outstanding; such loan is made or would result therefrom, (ii) in the case of Holding, (A) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt loan is evidenced by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents made on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date Agent and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed proceeds thereof are paid to the Borrower by any wholly-owned Subsidiary of Agent to be applied to the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding, (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02Loans.

Debt. Create, incur, assume or suffer permit to existexist any Debt, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other than:except (without duplication): (i) In the case Debt of the BorrowerBorrower (x) under the Loan Documents, (y) listed on Schedule 7.02(b) (and any Refinancing thereof) and (z) Credit Agreement Refinancing Indebtedness; (ii) (x) the 2032 Notes and any guarantee thereof and (y) any supplement, amendment, amendment and restatement, modification, replacement, Refinancing, refunding, restructuring, renewal or extension of any Debt specified in subclause (x) above; provided that, except to the extent otherwise permitted hereunder, (a) the principal amount of any such Debt is not increased above the principal amount thereof outstanding immediately prior to such supplement, amendment, amendment and restatement, modification, replacement, Refinancing, refunding, restructuring, renewal or extension except by an amount equal to the unpaid accrued interest and premium thereon plus any unused commitment plus the amounts paid in respect of fees, costs and expenses incurred in connection with such supplement, amendment, amendment and restatement, modification, replacement, Refinancing, refunding, restructuring, renewal or extension and (b) additional obligors with respect to such Debt are not added unless such additional obligors also become obligors hereunder; (iii) Debt incurred with respect to (i) letters of credit, bank guarantees or similar instruments in connection with any Commodity Hedge and Power Sale Agreement, Physical Power or Gas Sale Agreement, or any Interest Rate Agreement, in an aggregate outstanding face amount not to exceed $50,000,000 and (ii) any Acceptable Letter of Credit, in an aggregate outstanding face amount not to exceed $50,000,000; (iv) Debt among the Operating Parties and LRWV; provided that prior to LRWV becoming a Guarantor, Debt incurred by LRWV pursuant to this clause (iv) shall be permitted solely to the extent permitted as an Investment pursuant to Section 7.02(f)(xii); (v) Debt in respect of Hedge repurchase agreements constituting Cash Equivalents; (vi) Debt in respect of netting services, overdraft protections and otherwise in connection with deposit accounts; (vii) Debt of the Operating Parties and/or LRWV secured by Xxxxx permitted by clause (m) of the definition of “Permitted Liens” not to exceed in the aggregate, when taken together with any outstanding Debt permitted to be incurred pursuant to Section 7.02(b)(viii) and Section 7.02(b)(xiv), $50,000,000 at any time outstanding; provided, that any such Debt shall be secured only by the Property acquired in connection with the incurrence of such Debt; (viii) Debt of the Operating Parties and/or LRWV incurred for the purpose of funding any Required Capital Expenditures (including expenditures that would constitute Capital Expenditures but for clause (f) of the definition thereof) not to exceed in the aggregate, when taken together with outstanding Debt permitted to be incurred pursuant to Section 7.02(b)(vii) and Section 7.02(b)(xiv), $50,000,000 at any time outstanding; (ix) to the extent constituting Debt, payment obligations of the Operating Parties and/or LRWV under (A) Interest Rate Agreements designed to hedge against fluctuations in interest rates rates, (B) Commodity Hedge and Power Sale Agreements, to the extent permitted to be entered into under Section 7.02(m), in each case of (A) and (B), incurred in the ordinary course of business (it being acknowledged and agreed that any such agreements entered into for the purpose of complying with Sections 7.01(n) and (o) above, respectively, shall be deemed to be permitted Debt under this clause (ix)) or (C) any Physical Power or Gas Sale Agreement; (x) other Debt of the Operating Parties and/or LRWV in an aggregate amount not to exceed $25,000,000 at any one time outstanding; (xi) to the extent constituting Debt, and contingent obligations of the Operating Parties and/or LRWV under or in respect of performance bonds, bid bonds, appeal bonds, surety bonds, financial assurances and completion guarantees, indemnification obligations, obligations to pay insurance premiums, take or pay obligations and similar obligations in each case incurred in the ordinary course of business and consistent not in connection with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstandingdebt for borrowed money; (iixii) to the extent constituting Debt, Debt of the Operating Parties and/or LRWV arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the case ordinary course of Holdingbusiness or other cash management services in the ordinary course of business; provided, (A) Debt under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided that (w) such Debt is evidenced by a promissory note in substantially the form extinguished within 10 Business Days of Exhibit B to the Stockholders Agreement or otherwise subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions reasonably satisfactory to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior to the Termination Date, (y) the final maturity of such Debt is after the Termination Date and (z) amortization of such Debt is not required prior to the Termination Date, and (C) Debt under the 13% Subordinated Notes due May 31, 2009 issued by Holdingits incurrence; (iiixiii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000[reserved]; (ivxiv) Debt owed to the Borrower by any wholly-owned Subsidiary Finance Lease Obligations of the Borrower or Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv) Operating Parties and/or LRWV not to exceed in the aggregate aggregate, when taken together with any outstanding Debt permitted to be incurred pursuant to Section 7.02(b)(vii) and Section 7.02(b)(viii), $10,000,000 50,000,000 at any time outstanding,; provided, that any such Debt shall be secured only by the Property subject to such Finance Lease Obligations; (Cxv) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (D) unsecured Debt trade payables incurred in the ordinary course of business (but not for the deferred purchase price of property or services, maturing within one year from the date created, borrowed money) and aggregating, on a Consolidated basis, (A) not more than $7,500,000 at any one time outstanding,ninety (90) days past due or (B) being contested in good faith by appropriate proceedings; (Exvi) indorsement to the extent constituting Debt, financing of negotiable instruments for deposit or collection or similar transactions insurance premiums; (xvii) contingent obligations resulting from indemnities provided under the Transaction Documents and indemnities provided in the ordinary course under other Project Documents; and (xviii) obligations of the Operating Parties and/or LRWV under any Project Document incurred in the ordinary course of business, and business (Fincluding any guarantees made pursuant to the Project Documents) Debt to the extent such amounts are (other A) not overdue by more than Debt comprised ninety (90) days or (B) being contested in good faith and by appropriate proceedings and in respect of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower after the date hereof which adequate reserves are in place in accordance with the terms Operating Parties’ standard accounting practices. To the extent that the creation, incurrence, assumption or existence of any Debt could be attributable to more than one clause of this Section 5.027.02(b), the Borrower may allocate and re-allocate such Debt to any one or more of such clauses, and in no event shall the same portion of Debt be deemed to utilize or be attributable to more than one clause. For the avoidance of doubt, any Debt permitted to be incurred by any Covenant Party under a specific clause of this Section 7.02(b) and any guaranty in respect of such Debt which is also permitted to be incurred by such Covenant Party under the same clause of this Section 7.02(b) shall not count as two separate amounts of Debt for purposes of calculating compliance with the limitations set forth in such clause. Notwithstanding anything to the contrary herein or in any Loan Document, any interest or fees capitalized in connection with any Debt permitted under this Section 7.02(b) shall not be deemed to be a creation, incurrence, assumption or existence of Debt.