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 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. 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. 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. 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 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 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 ESM, (A) Subordinated Debt evidenced by the Borrower, 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 in an aggregate notional amount (together with the aggregate Agreement Value thereof Debt incurred pursuant to Section 5.02(b)(vii)(A)) not to exceed $2,500,000 120,000,000 at any time outstanding; (C) Debt in respect of Hedge Agreements designed to hedge against fluctuations in foreign exchange rates incurred in the ordinary course of business and consistent with past practice; and (D) Debt in respect of Redeemable Preferred Stock issued to Persons that are shareholders of ESM on the date hereof provided no mandatory redemption in respect thereof is required at any time prior to the date that is six months after the Termination Date; (ii) in the case of HoldingAmdocs (Israel), any Borrower (Aother than ESM) and its Subsidiaries, unsecured Debt under the Loan Documents, (B) Debt in respect of performance bonds in an aggregate principal amount for Amdocs (Israel), the Borrowers and their Subsidiaries not to exceed $10,000,000 the amount set forth opposite each year set forth below at any time issued pursuant to outstanding during the Stockholders Agreement or an Employment Agreement provided that (w) Fiscal Year ending in 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 year: YEAR AMOUNT ---- ------ 1998 $25,000,000 1999 40,000,000 2000 55,000,000 2001 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;thereafter 60,000,000 (iii) in the case of the Borrower and its SubsidiariesAmdocs (Israel), 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 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 outstandingSurviving Debt, (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 (FD) Debt owed to any Borrower or any other Loan Party; 53 49 (iv) in the case of Amdocs (Israel), the Subsidiaries of any Borrower or any Borrower other than ESM, (A) Debt comprised of senior bank financing secured by Liens permitted by Section 5.02(a)(iv) in an aggregate principal amount for Amdocs (Israel), the Borrowers and their Subsidiaries not to exceed the amount set forth opposite each year set forth below at any time outstanding during the Fiscal Year ending in such year: YEAR AMOUNT ---- ------ 1998 $30,000,000 1999 45,000,000 2000 60,000,000 2001 and thereafter 60,000,000 (B) Capitalized Leases (including vehicle leases) in an aggregate principal amount for Amdocs (Israel), the Borrowers and their Subsidiaries not to exceed the amount set forth opposite each year set forth below incurred during the Fiscal Year ending in such year: YEAR AMOUNT ---- ------ 1998 $15,000,000 1999 18,000,000 2000 20,000,000 2001 and thereafter 20,000,000 (C) any Debt extending the maturity of, or other similar working capital financing) of refunding or refinancing, in whole or in part, any Person Surviving Debt, provided that becomes a Subsidiary of the Borrower after the date hereof in accordance with 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 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 result of or in connection with such extension, refunding or refinancing,

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 outstandingNote Purchase Documents; (ii) Debt outstanding as of the Closing Date under the Second Lien Loan Documents in an aggregate principal amount not to exceed (a) $55,714,294 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 Note 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 the New Third Lien Documents outstanding at any time in an aggregate principal amount not to exceed $10,000,000 at any 90,000,000 (plus paid-in-kind interest thereon in accordance with the New Third Lien Documents, 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 Note 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 Third 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. 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 or suffer to exist, or permit any of its Subsidiaries to No Originator shall create, incur, assume or suffer permit to exist, exist any Debt (other than: than Debt of a type described in parts (f) or (g) of the definition of such term in Annex X) except (i) In the case Debt of the Borrowersuch Originator to CRLLC, 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 any Affected Party, any Purchaser Indemnified Person, or any other Person expressly permitted by this Agreement Value thereof not to exceed $2,500,000 at or any time outstanding; other Related Document, (ii) in the case of Holdingdeferred taxes, (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 unfunded pension fund and other employee benefit plan obligations and liabilities to the case of the Borrower and its Subsidiariesextent permitted under applicable law, the Permanent Debt in an aggregate principal amount not to exceed $105,000,000; (iv) Debt owed to endorser liability in connection with 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 (Fv) unsecured Debt arising out of the Credit Facility, (vi) existing Debt described on Schedule 4.03(k), (vii) Debt incurred or assumed for the purpose of financing all or any part of such Originator's cost of acquiring any fixed asset provided that the aggregate outstanding principal amount of all such Debt for any and all Originator's combined shall not exceed $1,000,000 at any one time; (viii) any other unsecured Debt, non-recourse Debt and Capital Lease Obligations (all such unsecured Debt, non-recourse Debt and Capital Lease Obligations being herein collectively referred to as the "New Debt") provided that (x) the aggregate allocated principal amount of such Capital Lease Obligations does not exceed $10,000,000 at any one time and (y) after giving effect to the incurrence of any New Debt, the ratio (expressed as a percentage) of (1) the total consolidated Debt (including without limitation New Debt) of Cone Xxxxx and its Subsidiaries to (2) the sum of the total consolidated Debt (including without limitation New Debt) of Cone Xxxxx and its Subsidiaries plus the consolidated Net Worth of Cone Xxxxx and its Subsidiaries shall not exceed 65%, and (ix) any refinancings, amendments or modifications of any of the Debt permitted pursuant to clause (vi) or (vii) above which does not have the effect of increasing the principal amount thereof (other than Debt comprised of senior bank financing to add accrued interest, fees 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 5.02related expenses to such principal amount).

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. 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. 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. 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 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. 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. 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 thanexcept: (i) In the case Debt of the Borrower, Debt in respect of Hedge Agreements designed Credit Parties to hedge against fluctuations in interest rates incurred in the ordinary course of business and consistent with prudent business practice with Secured Creditors under the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstandingCredit Documents; (ii) Debt incurred pursuant to Capital Leases and Purchase Money Mortgages, up to an aggregate outstanding amount, at any time, of $3,000,000 (or the Equivalent Amount in the case of Holding, another currency); (Aiii) Debt of a Credit Party owing to another Credit Party; (iv) Debt of a Credit Party pursuant to a mortgage on Owned Property of such Credit Party provided (i) the recourse of the creditor under such mortgage is limited to such Owned Property (and, for greater certainty, such creditor has no recourse to any Credit Party or its Assets other than the Loan Documents, Owned Property subject to such mortgage) and (Bii) the aggregate principal amount of Debt of the Credit Parties pursuant to this clause (iv) does not exceed $10,000,000 (or the Equivalent Amount in another currency) at any time; (v) Debt in an aggregate principal amount not to exceed exceeding Cdn. $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 12,585,000 under the Loan Documents Convertible Debentures outstanding 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 Closing 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; (iiivi) in the case Debt of the Borrower and its Subsidiaries, the Permanent Credit Parties pursuant to guarantees of Debt not otherwise permitted under this Section 5.2(a) in an aggregate principal amount not to exceed $105,000,0001,000,000 (or the Equivalent Amount in another currency) at any time; (ivvii) Debt owed to the Borrower by any wholly-owned Subsidiary of the Borrower or Credit Parties pursuant to earn-out obligations (i) in existence on the Closing Date in a maximum aggregate amount of $20,000,000 and (ii) earn-out obligations incurred pursuant to Permitted Acquisitions completed after the Closing Date; (viii) Debt owed to a wholly-owned Subsidiary of the Borrower by the Borrower or any other wholly-owned Subsidiary of the BorrowerCredit Parties pursuant to hedging arrangements permitted pursuant to Section 5.2(j); and (v) in the case of the Borrower and any of its Subsidiaries, (Aix) Debt under pursuant to the Loan Documents, (B) Early Draw Facility provided such Debt secured by Liens permitted by Section 5.02(a)(iv) not shall cease 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 be Permitted 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, on 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 of the terms of Section 5.02initial Advance.

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 Loan Parties or any other wholly-owned Subsidiary of the Borrower; and (v) in the case of the Borrower and any of its their Subsidiaries, (A) Debt under the Loan Documents,; (B) Debt secured to a Loan Party or any Subsidiary of a Loan Party, PROVIDED, HOWEVER that any such Debt owed by Liens permitted by Section 5.02(a)(iv) not a Non-U.S. Subsidiary shall be used solely to exceed fund working capital requirements of such Non-U.S. Subsidiary arising in the aggregate $10,000,000 at any time outstanding,ordinary course of its business; (C) Capitalized Leases not to exceed in Leases, PROVIDED, HOWEVER that, at any time, the sum of the aggregate outstanding principal component of all Capitalized Leases, and the aggregate outstanding principal amount of all Debt permitted under Section 5.02(b)(i)(F) shall not exceed the higher of $20,000,000 at any time outstanding,75,000,000 or 5% of Net Tangible Assets of the Company and its Subsidiaries on a consolidated basis (determined as of the end of the Fiscal Quarter immediately preceding the date of determination); (D) unsecured Debt incurred in that is fully subordinated to the ordinary course of business for Facilities and all other amounts owing or owed from time to time under the deferred purchase price of property or servicesLoan Documents on such terms as to subordination that are acceptable to the Administrative Agent and the Required Lenders, maturing within one year from including, without limitation, the date created, and aggregating, on a Consolidated basis, not more than $7,500,000 at any one time outstanding,Subordinated Notes; (E) indorsement Debt secured by receivables, PROVIDED, HOWEVER that, at any time, the sum of the aggregate outstanding principal amount of all Debt secured by receivables and the aggregate value of all then outstanding receivables sold or securitized as permitted under Section 5.02(e)(vii), shall not exceed the higher of $75,000,000 or 5% of Net Tangible Assets of the Company and its Subsidiaries on a consolidated basis (determined as of the end of the Fiscal Quarter immediately preceding the date of determination); (F) other Debt, subject to the proviso in Section 5.02(b)(i)(C) above, (ii) in the case of the Company and any of its Subsidiaries, 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, 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. 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 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 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 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. 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. 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 BorrowerLoan Documents and, with respect to Old PJC, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in contemplated 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 outstandingRelated Documents; (ii) Debt with respect to the Borrower's obligations under Exempt Facility Revenue Bonds (Washington Street Garage Corporation Project 1991 Series), in the case of Holding, (A) Debt under the Loan Documents, (B) Debt in an aggregate a 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 Holdingoutstanding; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount not respect of Hedge Agreements required to exceed $105,000,000be maintained under the terms of Section 5.01(n) hereof; (iv) unsecured Debt owed with respect to trade payables incurred in the Borrower by any wholly-owned Subsidiary ordinary course of the Borrower or Debt owed to a wholly-owned Subsidiary business which are being paid in accordance with customary industry practices, and for payment of the Borrower by the Borrower or any payrolls and other wholly-owned Subsidiary of the Borrower; andordinary business expenses; (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 and obligations in the aggregate $10,000,000 at any time outstanding, (C) respect of Capitalized Leases and purchase money security interests not to exceed in the aggregate $20,000,000 at any time outstanding,, and together with the Debt permitted by Section 5.02(b)(vi), (vii), and (viii) not to exceed in the aggregate $45,000,000 at any time outstanding; (Dvi) unsecured Debt consisting of trade letters of credit incurred in the ordinary course of business for not to exceed $5,000,000 in the deferred purchase price of property or services, maturing within one year from the date createdaggregate at any time outstanding, and aggregatingtogether with the Debt permitted by Section 5.02(b)(v), on a Consolidated basis(vii), and (viii) not more than to exceed in the aggregate $7,500,000 45,000,000 at any one time outstanding,; (E) indorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (Fvii) Debt consisting of guaranties (other than Debt comprised of senior bank financing or other similar working capital financingthe guaranty described in 5.02(b)(ii) above) of any Person that becomes a Subsidiary obligations of Subsidiaries of the Borrower with respect to investments made by such Subsidiaries not to exceed $10,000,000 in the aggregate at any time outstanding, and together with the Debt permitted by Section 5.02(b) (v), (vi), and (viii), not to exceed in the aggregate $45,000,000 at any time outstanding; (viii) Other Debt not exceeding $10,000,000 in the aggregate at any time outstanding, and together with the Debt permitted by Section 5.02(b)(v), (vi) and (vii), not to exceed in the aggregate $45,000,000 at any time outstanding; (ix) Debt owed by the Borrower or any of its Subsidiaries to the Borrower or any of its Subsidiaries as the case may be; (x) Unsecured Subordinated Debt of the Borrower not to exceed (together with the Debt permitted by Section 5.02(b)(xi)) $150,000,000 in the aggregate at any time outstanding; provided that (A) such Subordinated Debt would be permitted by Section 5.04(a), (B) no Default or Event of Default exists or would occur after the date hereof incurrence of such Subordinated Debt, (C) the terms of such Subordinated Debt are are in accordance no event more restrictive than the terms of the Facilities hereunder and are otherwise satisfactory to the Required Lenders in their reasonable discretion, and (D) the net proceeds of such Subordinated Debt are used to prepay the Term Loan or reduce the Revolving A Commitment to the extent required by Section 2.05(e). (xi) After such time as the Borrower shall have completed an internal reorganization which results in the Borrower's operating divisions becoming wholly owned Material Subsidiaries, and the Borrower shall have complied in all respects with the terms of Section 5.025.01(o), the Borrower may issue unsecured Debt equal in right of payment with the Obligations hereunder in an aggregate principal amount not to exceed (together with the Subordinated Debt permitted by Section 5.02(b)(x)) $150,000,000 at any time outstanding; provided that (A) such Debt would be permitted by Section 5.04(a), (B) no Default or Event of Default exists or would occur after the incurrence of such Debt, (C) the terms of such Debt are in no event more restrictive than the terms of the Facilities hereunder and are otherwise satisfactory to the Required Lenders in their reasonable discretion, and (D) the net proceeds of such Debt are used to prepay the Term Loan or reduce the Revolving A Commitment to the extent required by Section 2.05(d).

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, 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. 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. 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 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. 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: (ia) In the case of the Borrower, (i) Debt in respect incurred pursuant to the Loan Documents and (ii) Debt owed to Carsen as a result of Hedge Agreements designed cash advances from Carsen to hedge against fluctuations in interest rates incurred in Borrower after the ordinary course of business and consistent with prudent business practice with the aggregate Agreement Value thereof not date hereof which shall be repaid from time to exceed $2,500,000 at any time outstandingtime; (iib) in 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 SubsidiariesSubsidiaries of the Borrower, 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 Wholly Owned Domestic Subsidiary of the Borrower; andPROVIDED, that such Debt shall be evidenced by an Intercompany Note, such Intercompany Note is assigned and pledged to the Administrative Agent pursuant to the terms of the Security Agreement and the Note Assignment Agreement and there are no restrictions whatsoever on the ability of such Subsidiary to repay such Debt; (vc) in In the case of the Borrower and any of its Subsidiaries,: (i) (A) Debt under the Loan Documents, (B) Debt secured by Liens permitted by Section 5.02(a)(iv6.1(d) not to exceed in the aggregate $10,000,000 500,000.00 at any time outstanding, , (CB) Capitalized Leases Leases, collectively not to exceed in the aggregate $20,000,000 250,000.00 at any time outstanding, , (C) Operating Leases with a maximum annual rental obligation collectively not to exceed in the aggregate $1,500,000.00 at any time outstanding and (D) unsecured Surviving Debt incurred in the ordinary course of business for the deferred purchase price of property or services, maturing within one year from existing on the date created, hereof and aggregating, described on a Consolidated basis, not more than $7,500,000 at any one time outstanding,SCHEDULE 4.19(b); and (Eii) indorsement endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and. (Fd) In the case of Carsen, Debt incurred pursuant to (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 Canadian Credit Agreement in an amount not to exceed $5,000,000.00 and (ii) the date hereof in accordance with the terms of hedging agreements permitted under Section 5.026.16(b).

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. 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. 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. 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. 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. 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. 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. Create, incur, assume (a) Not permit IPC Holdings or suffer to exist, or permit any of its Subsidiaries Max Holdings to create, incur, assume or suffer permit to existexist any Debt, or agree, become or remain liable (contingent or otherwise) to do any Debt other than: of the foregoing, except for (i) In the case Obligations; (ii) Debt in connection with letters of credit; and (iii) other Debt which is either incurred in connection with any Lien permitted under Section 6.3 or pari passu in right of payment with, or subordinated in right of payment to, the Obligations, so long as upon the incurrence thereof no Default or Event of Default would occur or exist. (b) Not permit any Subsidiary (excluding Max Holdings) to, create, incur, assume or permit to exist any Debt, or agree, become or remain liable (contingent or otherwise) to do any of the Borrowerforegoing, except for (i) the Obligations; (ii) Debt for standby letters of credit which have been, or may be from time to time in the future, issued to insurance or reinsurance cedants in the ordinary course of business; (iii) Debt in respect of connection with Hedge Agreements designed to hedge against fluctuations in interest rates incurred entered into in the ordinary course of business in order to hedge currency, commodity or interest rate risks, and consistent not for purposes of speculation; (iv) Debt which is incurred in connection with prudent business practice any Lien permitted under Section 6.3(n); (v) Debt in connection with Total Return Equity Swaps, provided the total aggregate Agreement Value thereof amount outstanding at any time does not exceed an amount equal to 10% of the Investment Portfolio of Max Bermuda; (vi) Debt in connection with Permitted Guarantees; (vii) unsecured Debt of Max US Holdings and its Subsidiaries not to exceed $2,500,000 at any 150,000,000; (viii) Debt of Max UK for standby letters of credit which have been, or may be from time outstanding; (ii) to time in the case future be, issued to provide funds at Lloyd’s to support Lloyd’s syndicate commitments of Holding, Max UK and its Subsidiaries; (Aix) Debt under the Loan Documentsof Subsidiaries of IPC Holdings owing to IPC Holdings or to other Subsidiaries of IPC Holdings, (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) if such Debt is evidenced owed by a promissory note in substantially the form of Exhibit B to the Stockholders Agreement or otherwise Credit Party, such Debt must be subordinated in right of payment to the Obligations of Holding under the Loan Documents on terms and conditions in a manner reasonably satisfactory to the Lender PartiesAdministrative Agent; and (x) unsecured Debt not otherwise permitted by this Section 6.2 not to exceed at any time $75,000,000 in aggregate principal amount outstanding, provided that (x) such Debt shall does not bear interest on contain any measures of financial performance (however expressed and whether stated as a cash basis prior to the Termination Datecovenant, as a ratio, as a fixed threshold, as an event of default, as a mandatory prepayment provision, or otherwise) which, taken as a whole, are more restrictive than those measures of financial performance contained in this Agreement and (y) upon the final maturity incurrence thereof no Default or Event 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 Default would occur 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 5.02exist.

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. 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 BorrowerParent and its Subsidiaries (other than the Subsidiary Guarantors), 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 outstandingpractice; (ii) in the case of Holdingany Subsidiary of the Parent, (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 Parent or an Employment Agreement to a wholly owned Subsidiary of the Parent, provided that (w) that, in each case, such Debt is (x) shall, in the case of Debt owed to a Loan Party, constitute Pledged Debt and (y) shall be evidenced by a promissory note notes in substantially the form of Exhibit B and substance satisfactory to the Stockholders Agreement or otherwise subordinated Administrative Agent and such promissory notes shall, in right the case of payment Debt owed to a Loan Party, be pledged as security for the Obligations of Holding the holder thereof under the Loan Documents on terms to which such holder is a party and conditions reasonably satisfactory delivered to the Lender Parties, (x) such Debt shall not bear interest on a cash basis prior Collateral Agent pursuant to the Termination Date, (y) terms of 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;Security Agreement; and (iii) in the case of the Borrower Parent 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 25,000,000 at any time outstanding, (C) in addition to Debt referred to in clause (B), (x) Capitalized Leases not to exceed in the aggregate $20,000,000 15,000,000 at any time outstanding, and (y) in the case of Capitalized Leases to which any Subsidiary of the Parent is a party, Debt of the Parent of the type described in clause (i) of the definition of "Debt" guaranteeing the Obligations of such Subsidiary under such Capitalized Leases, (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, provided further that the principal amount of such Surviving Debt shall not be increased above the greater of (1) the original principal amount thereof and (2) the principal amount thereof outstanding immediately prior to such extension, refunding or refinancing, and the direct obligors therefor shall not be changed, as a Consolidated basisresult of or in connection with such extension, not more than $7,500,000 at any one time outstanding, refunding or refinancing, provided still further that the terms relating to subordination (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 financingif any) of any Person that becomes a Subsidiary such extending, refunding or refinancing Debt, are no less favorable in any material respect to the Loan Parties or the Lender Parties than such terms of the Borrower after Surviving Debt being extended, refunded or refinanced and the date hereof interest rate applicable to any such extending, refunding or refinancing Debt does not exceed the then applicable market interest rate, provided still further that any extending refunding or refinancing Debt shall not have the benefit of any Debt of the Parent or any of its subsidiaries of the type described in accordance with clause (i) of the terms definition of Section 5.02"Debt" guaranteeing the Obligations of the direct obligor of such extending, refunding or refinancing Debt,

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 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 18,000,000 outstanding at any time, (ii) following the closing of the Tecon Acquisition, the secured indebtedness of Tecon which as of the closing of the Tecon Acquisition shall be in an aggregate outstanding principal balance not exceeding $15,750,000 and which when repaid may not be reborrowed, (iii) secured indebtedness for purchase money financing of equipment which is permitted under Section 6.02(d)(iv) in a principal amount not to exceed an aggregate of $2,000,000 outstanding at any time, (iv) other secured Debt identified on Schedule 6.02(e) not to exceed the applicable amount indicated on such schedule, (v) the Term Loan, (vi) the Additional Revolving Loan (as defined in the BofA Loan Documents), (vii) unsecured senior funded bank debt in a principal amount not to exceed $40,000,000 outstanding at any time outstanding; (ii) in the case of Holdingaggregate for the Borrower and its Subsidiaries (including, (A) Debt under without limitation, unsecured senior funded bank debt incurred pursuant to the Loan Documents and the BofA Loan Documents, and excluding the undrawn face amount of the Capistrano Letter of Credit); provided that the only unsecured senior funded debt of the Subsidiaries which may be outstanding shall be (Bi) Debt unsecured bank indebtedness of NMUI in an aggregate principal amount not to exceed $10,000,000 4,000,000 at any one time and (ii) other unsecured senior funded debt in a principal amount not to exceed $500,000 outstanding at any time issued pursuant to in 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 Partiesaggregate for all Subsidiaries, (xviii) such Debt indebtedness assumed or incurred in connection with any acquisition either: (a) detailed on Schedule 6.02(e); or (b) arising from a Permitted Acquisition, the sum of which shall not bear interest on exceed a cash basis prior to the Termination Date, (y) the final maturity principal amount 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) $7,000,000 in the case of aggregate outstanding at any time for the Borrower and its Subsidiaries, (ix) intercompany Debt between the Permanent Debt Borrower and its majority-owned Subsidiaries, and (x) secured bonds in an aggregate principal face 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 15,000,000 issued by Suburban on or about October 11, 2004 and secured bonds in an aggregate face amount of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, and (F) Debt (other not more than Debt comprised of senior bank financing or other similar working capital financing) of any Person that becomes a Subsidiary of the Borrower $12,000,000 issued by NMUI after the date hereof in accordance with the terms of Section 5.02this Amendment."

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. 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, (Bii) Debt of the Borrower secured by Liens permitted by Section 5.02(a)(ivSections 5.02(a)(i) and 5.02(a)(ii) and Capitalized Leases of the Borrower, not to exceed in the aggregate $10,000,000 150,000,000 at any time outstanding; provided, however, (A) Capitalized Leases shall not exceed in the aggregate $30,000,000 at any time outstanding and (B) purchase money secured Debt shall not exceed in the aggregate $30,000,000 at any time outstanding, (C) Capitalized Leases not to exceed in the aggregate $20,000,000 at any time outstanding, (Diii) unsecured Debt incurred in of the ordinary course Borrower not otherwise permitted which does not exceed the aggregate principal amount 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 50,000,000 at any one time outstanding, which unsecured Debt ranks subordinate to or pari passu with Debt under this Agreement and the covenants, defaults and similar provisions applicable to such Debt are no more restrictive in any respect than the provisions contained in this Agreement and do not conflict with the provisions of this Agreement, (Eiv) indorsement 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 financing) of any Person that becomes a Subsidiary of the Borrower after not exceeding the date hereof aggregate principal amount of $200,000,000 at any one time outstanding, provided that, in accordance with the terms case of Section 5.02any Subordinated Debt other than the 6% Convertible Subordinated Debentures, (A) the interest rate payable on the principal amount of such Subordinated Debt is no greater than the greater of (1) 10% per annum or (2) the sum of the yield on U.S. Treasury Bills of comparable maturity to such Subordinated Debt plus 3.5% per annum at the time of issuance, (B) the covenants, defaults and similar provisions applicable to such Subordinated Debt are no more restrictive to the Borrower in any respect than the provisions contained in the Subordinated Debt Fiscal and Paying Agency Agreement, and 62 59

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. CreateThe Company shall not, directly or indirectly, ---- create, incur, assume or suffer to exist, or permit any of its Subsidiaries Subsidiary to create, incur, assume or suffer to exist, any Debt other thanthan the following: (a) obligations under the Operative Documents; (b) Debt set forth on Schedule 8.24 and any extension, renewal or replacement of such Debt that is on at least as favorable terms (adjusted for market conditions at the time of such extension, renewal or replacement) and that does not increase the aggregate principal of such Debt; (c) Debt owing by (i) In the case Company to any Subsidiary in any amount, (ii) the Material Subsidiaries to the Company in any amount and (iii) Subsidiaries that are not Material Subsidiaries to the Company in an aggregate outstanding amount not to exceed 10% of the Borrower, Consolidated Tangible Net Worth at any time; (d) Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in Commercial Paper issued by the ordinary course Company under a Commercial Paper Program for which the Revolving Credit Agent and Revolving Credit Lenders are providing credit enhancement as contemplated by Section 2.13 of business and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstandingRevolving Credit Agreement; (ii) in the case of Holding, (Ae) 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 incurred as a promissory note in substantially the form result 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 endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business; (f) Other Debt of the Company and its Subsidiaries (including any Subsidiary that is acquired by (or merged or consolidated into) the Company or a Subsidiary after the Closing Date) in an aggregate amount not to exceed $200,000,000 at any time outstanding; provided however, that: -------- ------- (A) The incurrence of any such Debt would not result in a violation of any term of this Agreement or any other Operative Document, including without limitation, Section 8.23 hereof, or otherwise result in a Default or Event of Default; (B) Such other Debt (including Debt in respect to standby letters of credit) of the Company and its Material Subsidiaries shall not exceed $175,000,000 in the aggregate at any one time outstanding and shall be pari passu in right of repayment with the obligations of the Company under the Operative Documents; (C) Such other Debt of Subsidiaries that are not Material Subsidiaries shall not exceed $50,000,000 in the aggregate at any one time outstanding; and (FD) Such other Debt (other than Debt comprised 1) secured by Purchase Money Liens, (2) constituting Capitalized Lease Obligations and (3) assumed by the Company or any Subsidiary in connection with any transaction of senior bank financing merger or other similar working capital financing) of consolidation with any Person that becomes or in connection with the acquisition by the Company or a Subsidiary of all or substantially all of the Borrower after assets constituting the date hereof business or a division or operating unit of a Person and which such assumed Debt is secured by a Lien on assets acquired in accordance connection with such merger, consolidation or acquisition, shall not exceed $50,000,000 in the terms of Section 5.02aggregate at any one time outstanding.

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. 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 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. 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. 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 (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. 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. 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, (A) Debt under the Loan Documents, ; (Bii) Debt under the First Lien Loan Documents 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 Holding1,500,000,000; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount incurred solely to finance Permitted Developments not to exceed in the aggregate, when taken together with any equity proceeds referred to in Section 5.02(f)(viii)(A), $105,000,000140,000,000; (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)(iv5.02(a)(v) not to exceed in the aggregate $10,000,000 30,000,000 at any time outstanding,; (Cv) to the extent constituting Debt, (A) payment obligations under Secured Hedge Agreements and (B) obligations under the Borrower’s fuel oil inventory financing program relating to (x) Mystic I not to exceed in the aggregate at any time 750,000 bbls and (y) Fore River not to exceed in the aggregate at any time 700,000 bbls; (vi) to the extent permitted under Section 5.02(l) and constituting Debt, obligations under any (A) Permitted Commodity Hedge and Power Sale Agreements and (B) other Commodity Hedge and Power Sale Agreements with net exposure thereunder not to exceed in the aggregate at any time $110,000,000; (vii) Debt owed to any Loan Party, which Debt shall (x) constitute Pledged Debt, (y) be subordinated pursuant to the Terms of Subordination and (z) be otherwise permitted under Section 5.02(f); (viii) Capitalized Leases not to exceed in the aggregate $25,000,000 for Fore River, $45,000,000 for Mystic Development and $20,000,000 for Mystic I, in each case, at any time outstanding,; (Dix) unsecured to the extent constituting Debt, Debt in respect of performance bonds, bid bonds, appeal bonds, surety bonds, completion guarantees, indemnification obligations, obligations to pay insurance premiums, take or pay obligations and similar obligations incurred in the ordinary course of business and not in connection with Debt 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,Borrowed Money; (Ex) indorsement other unsecured Debt of the Loan Parties issued in settlement of delinquent obligation of the Loan Parties or disputes between the Loan Parties and other Persons under Contractual Obligations of the Loan Parties (other than in respect of Debt); (xi) Guaranteed Debt of any Loan Party in respect of any Debt otherwise permitted to be incurred under this Section 5.02(b); (xii) endorsements of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, collection; (xiii) (without duplication) Surviving Debt; and (Fxiv) other unsecured 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 Loan Parties in accordance with the terms of Section 5.02an aggregate amount not to exceed $55,000,000 at any time outstanding.

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; (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, whether or not attributable to the Company under GAAP; 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. 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. 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 Create or suffer to exist, or permit any of its Subsidiaries to create, incur, assume create or suffer to exist, any Debt other thanthan the following, provided that any Debt permitted by any clause below shall be permitted under this Section 5.02(d), notwithstanding that such Debt would not be permitted by any other clause: (i) In Debt owed to the case Company or to a Consolidated Subsidiary 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;Company, (ii) in Debt existing on the case of HoldingEffective Date and described on Schedule 5.02(d) hereto (the “Existing Debt”), and any Permitted Refinancing thereof, (Aiii) Debt under secured by Liens of the Loan Documents, type described in and to the extent permitted by Section 5.02(a)(iii) and (Bvi) Debt in an aggregate principal amount not to exceed $10,000,000 200,000,000 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;outstanding, (iv) Debt owed to of a Person existing at the Borrower by time such Person is amalgamated, merged into or consolidated with the Company or any wholly-owned Subsidiary of the Borrower Company or Debt owed to becomes a wholly-owned Subsidiary of the Borrower by the Borrower Company; provided that such Debt was not created in contemplation of such amalgamation, merger, consolidation or any other wholly-owned Subsidiary of the Borrower; andacquisition, (v) in the case of the Borrower and any of its Subsidiaries, (A) Debt arising under the Loan Documents, (Bvi) Debt secured incurred by Liens permitted by Section 5.02(a)(iv) Emerging Market Subsidiaries in an amount not to exceed in the aggregate $10,000,000 200,000,000 at any time outstanding, (Cvii) Capitalized Leases Debt incurred by Kodak International Finance Limited, a company organized and existing under the laws of England, (x) in connection with short term working capital needs in an aggregate amount not to exceed $100,000,000 at any time outstanding and (y) consisting of Hedge Agreement Obligations entered into in the ordinary course of business to protect the Company and its Subsidiaries against fluctuations in commodities, interest or exchanges rates, (viii) Debt incurred by Subsidiaries organized under the laws of any jurisdiction outside of the United States or Canada in an aggregate amount not to exceed $20,000,000 100,000,000 at any time outstanding, (Dix) 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 to exceed $7,500,000 300,000,000 at any one time outstanding, (Ex) indorsement endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, (xi) Debt which exists or may exist under the Secured Agreements in existence from time to time, (xii) Debt that is subordinated to the obligations of the Company under the Loan Documents on terms that are reasonably satisfactory to the Agent and the Required Lenders and any Permitted Refinancing thereof, provided that (i) the aggregate principal amount of such Debt shall not exceed $100,000,000 at any time outstanding, (ii) after giving effect thereto, the Company shall be in pro forma compliance with a Fixed Charge Coverage Ratio of 1.1:1.0 and (iii) Excess Availability shall equal or exceed $100,000,000 on a pro forma basis after giving effect to the issuance of such Debt, (xiii) unsecured Debt consisting of guarantees of amounts owing by customers of the Company under equipment and vendor financing programs in an aggregate amount not to exceed $75,000,000 at any time outstanding, (xiv) unsecured Debt in connection with surety bonds, guarantees and letters of credit for customs and excise taxes, value added taxes, insurance and environmental liabilities, rental expenses, tenders and bids and other obligations of the like incurred in the ordinary course of business in an aggregate principal amount not to exceed $25,000,000 at any time outstanding, (xv) Permitted Second Lien Debt in an aggregate amount not to exceed $1,000,000,000 at any time outstanding and any Permitted Refinancing thereof, (xvi) Debt secured by Liens permitted under Section 5.02(a)(x), provided that such Debt shall be non-recourse to the Company and its Subsidiaries, (xvii) Guarantees (i) of any Loan Party in respect of Debt of either Borrower or any other Loan Party otherwise permitted hereunder and (ii) of any Subsidiary that is not a Loan Party in respect of Debt of any other Subsidiary that is not a Loan Party otherwise permitted hereunder; and (Fxviii) additional Debt (other than Debt comprised of senior bank financing or other similar working capital financing) of not to exceed $25,000,000 at any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02time outstanding.

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 thanDebt, except: (i) In in the case of the US Borrower and any Subsidiary of the US Borrower, (A) Debt owed to the US Borrower or to a wholly owned Subsidiary of the US Borrower, provided that, in each case, such Debt (x) shall, in the case of Debt owed to an Immaterial Subsidiary or a Subsidiary that is not a Loan Party or is in respect of the refinancing of the Greyhound Foothill Facility or the Xxxxxx Credit Facility Assignment, be subordinated to the Obligations of the US Borrower or such Subsidiary under the Loan Documents on terms acceptable to the Administrative Agent and (y) shall be permitted by Section 5.02(e)(ii); and (B) Debt of non-U.S. Subsidiaries incurred in the ordinary course of business in an aggregate amount not to exceed $50,000,000 at any time outstanding; and (ii) in the case of the Borrowers and their Subsidiaries, (A) Debt under the Loan Documents; (B) at any time outstanding (1) Debt secured by Liens permitted by Section 5.02(a)(iv) and (2) Capitalized Leases (including the aggregate amount of Capitalized Leases assumed in connection with any acquisition permitted under Section 5.02(e)(xii)) not to exceed an aggregate amount equal to 7.5% of Consolidated Tangible Assets at such time, and (3) in the case of Capitalized Leases to which any Subsidiary of the US Borrower is a party, Debt of the US Borrower of the type described in clause (i) of the definition of “Debt” guaranteeing the Obligations of such Subsidiary under such Capitalized Leases subject to the limitations set forth in Section 5.02(e)(ii); (C) Debt of any Loan Party; provided that any such Debt shall be on market terms; (D) 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 otherwise not prohibited by the Loan Documents; 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, plus the amount of any premiums required to be paid thereon and reasonable fees and expenses associated therewith, and the direct and contingent obligors therefor shall not be changed, as a result of or in connection with such extension, refunding or refinancing; and provided further that (1) such extending, refunding or refinancing Debt shall have (x) a final maturity no earlier than the final maturity of Debt being extended, refunded or refinanced and (y) a weighted average life at least as long as the Debt being extended, refunded or refinanced and (2) the terms relating to maturity and subordination (if any) 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 Surviving Debt being extended, refunded or refinanced; (E) Debt of any Person that becomes a Subsidiary of a Borrower after the date hereof in accordance with the terms of Section 5.02(e)(xii) or (xiii) and extensions, renewals or replacements of such Debt that do not increase the principal amount thereof, which Debt is existing at the time such Person becomes a Subsidiary of such Borrower (other than Debt incurred solely in contemplation of such Person becoming a Subsidiary of such Borrower); provided that there is no change in the direct or indirect obligors in respect of such Debt; (F) Debt consisting of customary purchase price adjustments, earn-outs, indemnification obligations and similar items of the Loan Parties in connection with any sale or other disposition of assets or any acquisition permitted under Section 5.02(e); (G) Debt, not to exceed $150,000,000 at any time outstanding, incurred in connection with the sale of accounts receivable; (H) Debt incurred in the ordinary course of business in respect of netting services and overdraft protections in connection with deposit accounts; (I) Debt in respect of bid, performance and surety bonds and appeal bonds issued for the account of the US Borrower or any of its Subsidiaries in the ordinary course of business, including guarantees and obligations of the US Borrower or any of its Subsidiaries with respect to such bids and bonds and letters of credit supporting such bids; (J) Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates or foreign exchange rates or fuel hedging contracts 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 Borrowerpractice; and (vK) in guarantees by the case of the US Borrower and or 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 5.02Debt that is otherwise permitted hereunder.

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, (A) Debt under the Loan Documents, ; (Bii) Debt under the Second Lien Loan Documents 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 Holding350,000,000; (iii) in the case of the Borrower and its Subsidiaries, the Permanent Debt in an aggregate principal amount incurred solely to finance Permitted Developments not to exceed in the aggregate, when taken together with any equity proceeds referred to in Section 5.02(f)(viii)(A), $105,000,000140,000,000; (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)(iv5.02(a)(v) not to exceed in the aggregate $10,000,000 25,000,000 at any time outstanding,; (Cv) to the extent constituting Debt, (A) payment obligations under Secured Hedge Agreements and (B) obligations under the Borrower’s fuel oil inventory financing program relating to (x) Mystic I, not to exceed in the aggregate at any time 750,000 bbls and (y) Fore River, not to exceed in the aggregate at any time 700,000 bbls; (vi) to the extent permitted under Section 5.02(l) and constituting Debt, obligations under any (A) Permitted Commodity Hedge and Power Sale Agreements and (B) other Commodity Hedge and Power Sale Agreements with net exposure thereunder not to exceed in the aggregate at any time $100,000,000; (vii) Debt owed to any Loan Party, which Debt shall (x) constitute Pledged Debt, (y) be subordinated pursuant to the Terms of Subordination and (z) be otherwise permitted under Section 5.02(f); (viii) Capitalized Leases not to exceed in the aggregate $20,000,000 for Fore River, $40,000,000 for Mystic Development and $15,000,000 for Mystic I, in each case, at any time outstanding,; (Dix) unsecured to the extent constituting Debt, Debt in respect of performance bonds, bid bonds, appeal bonds, surety bonds, completion guarantees, indemnification obligations, obligations to pay insurance premiums, take or pay obligations and similar obligations incurred in the ordinary course of business and not in connection with Debt 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,Borrowed Money; (Ex) indorsement other unsecured Debt of the Loan Parties issued in settlement of delinquent obligation of the Loan Parties or disputes between the Loan Parties and other Persons under Contractual Obligations of the Loan Parties (other than in respect of Debt); (xi) Guaranteed Debt of any Loan Party in respect of any Debt otherwise permitted to be incurred under this Section 5.02(b); (xii) endorsements of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, collection; (xiii) (without duplication) Surviving Debt; and (Fxiv) other unsecured 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 Loan Parties in accordance with the terms of Section 5.02an aggregate amount not to exceed $50,000,000 at any time outstanding.

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. 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. 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. 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. CreateNo Borrower Party shall 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 Debt under the Loan Documents; (ii) Debt owed to any other Borrower Party, provided that, in each case, such Debt (A) shall be on terms acceptable to the Administrative Agent and (B) shall be evidenced by promissory notes in form and substance satisfactory to the Administrative Agent, which promissory notes shall (unless payable to a Borrower) by their terms be subordinated to the Obligations of the Loan Parties under the Loan Documents; (iii) Debt secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $3,000,000 at any time outstanding in respect of all Borrower Parties; (A) Capitalized Leases not to exceed in the aggregate $3,000,000 at any time outstanding in respect of all Borrower Parties, and (B) in the case of any Capitalized Lease to which any Subsidiary of a Borrower Party is a party, any Contingent Obligation of such Borrower Party guaranteeing the BorrowerObligations of such Subsidiary under such Capitalized Lease; (v) Prior to the Collateral Delivery Date, the Surviving Debt described on Schedule 4.01(o); (vi) 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 outstandingpractices; (iivii) 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 Endorsements of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, ; and (Fviii) Any other Debt (other than Debt comprised not to exceed $3,000,000 in the aggregate at any time outstanding in respect of senior bank financing or other similar working capital financing) of all Borrower Parties and which is not secured by any Person that becomes a Subsidiary of the Borrower after the date hereof in accordance with the terms of Section 5.02Lien.

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, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in the ordinary course of business Subordinated Debentures and consistent with prudent business practice with the aggregate Agreement Value thereof not to exceed $2,500,000 at any time outstandingConvertible Preferred Stock; (ii) in the case of Holdingany of the Subsidiary Guarantors, Debt owed to the Borrower or to another Subsidiary Guarantor, provided that (Ax) such Debt is subordinated to any Debt of such Subsidiary Guarantor under the Loan Documents, (B) Debt in an aggregate principal amount not to exceed $10,000,000 at any time issued pursuant Documents on terms and conditions acceptable to the Stockholders Agreement or an Employment Agreement provided that Required Lenders and (wy) such Debt is evidenced by a promissory note and such promissory note is pledged in substantially favor of the form of Exhibit B Secured Parties pursuant 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 BorrowerSecurity Agreement; and (viii) in the case of the Borrower and any of its Subsidiaries, (A) Debt under the Loan Documents, (B) Debt of the Borrower and its Subsidiaries (other than D.C. Chartered Health Plan, Inc.) secured by Liens permitted by Section 5.02(a)(iv) not to exceed in the aggregate $10,000,000 1,000,000 at any time outstanding, (Ci) Capitalized Leases (other than any Capitalized Leases included in Surviving Debt) entered into by the Borrower and its Subsidiaries (other than D.C. Chartered Health Plan, Inc.) not to exceed in the aggregate $20,000,000 5,000,000 at any time outstanding, , and (Dii) unsecured Debt incurred in the ordinary course case 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 Capitalized Leases to which 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 such Subsidiary of the Borrower after is a party, Debt of the date hereof Borrower of the type described in accordance with clause (j) of the terms definition of Section 5.02"Debt" guaranteeing the Obligations of such Subsidiary under such Capitalized Leases,

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. 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. 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 the case Debt of the BorrowerBorrower under the Financing Documents (including Debt incurred pursuant to Section 2.14); (ii) secured Debt of the Borrower in an aggregate principal amount, when combined with the aggregate principal amount of Debt incurred pursuant to Section 2.14, not to exceed $200,000,000 at any time outstanding; (iii) Surviving Debt; (iv) unsecured Debt owed to the Parent, the Borrower or any Subsidiary of the Borrower so long as such Debt is subordinated to the Advances in accordance with the Affiliate Subordination Terms and to the extent such Debt is owed to any Loan Party such Debt constitutes Pledged Debt; (v) 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 to hedge or mitigate (A) risks to which the Borrower or any Subsidiary is exposed in the conduct of its business or the management of its liabilities as a result of fluctuations in the prices of transmission, capacity or energy (or of any fuel required for the generation thereof) or (B) risks in respect of interest rate fluctuations; provided that in each case such Hedge Agreement shall not have been entered into for speculative purposes; (vi) Debt incurred to finance all or any part of the acquisition, construction or improvement of any real property, physical assets or equipment (including Capital Expenditures); provided that such Debt is incurred prior to or within 90 days after such acquisition or the completion of construction or completion of improvement or such Capital Expenditures; provided further that the aggregate principal amount of Debt permitted under this Section 5.02(b)(vi), when combined with the aggregate Agreement Value thereof principal amount of Debt incurred in connection with Capitalized Leases permitted under Section 5.02(b)(vii) shall not to exceed $2,500,000 100,000,000 at any time outstanding; (iivii) in the case of Holding, (A) Debt under the Loan Documents, (B) Debt Capitalized Leases in an aggregate principal amount, when combined with the aggregate principal amount of all Debt incurred pursuant to Section 5.02(b)(vi), not to exceed in excess of $10,000,000 100,000,000 at any time issued pursuant to the Stockholders Agreement or an Employment Agreement provided outstanding; (viii) Debt of any Person 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 merged into or Debt owed to a wholly-owned Subsidiary of the Borrower by consolidated with the Borrower or any other wholly-owned Subsidiary of the Borrower; and or (vy) 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 either case in accordance with the terms of Section 5.025.02(f); provided that (A) such Debt is existing at the time such Person becomes a Subsidiary of the Borrower (other than Debt incurred solely in contemplation of such Person becoming a Subsidiary of the Borrower), (B) immediately after giving effect to the investment in such Subsidiary, no Default or Event of Default shall have occurred and be continuing and (C) such Debt is non-recourse to the Borrower or any other Subsidiary of the Borrower (other than with respect to such Person and its Subsidiaries to the extent such Debt was with recourse to such Person and/or its Subsidiaries at the time of such investment); (ix) Debt arising from the honoring by a bank or financial institution of a check, draft or similar instrument inadvertently (except in the case of daylight overdrafts) drawn against insufficient funds in the ordinary course of business, so long as such Debt is covered within five Business Days; (x) Debt in respect of workers' compensation claims, self-insurance obligations, bankers' acceptance and performance and surety bonds provided by the Borrower or any of its Subsidiaries in the ordinary course of business; (xi) Debt that may be deemed to arise as a result of agreements of the Borrower or any of its Subsidiaries providing for indemnification, adjustment of purchase price or any similar obligations, in each case, incurred in connection with the sale or disposition of any business, Assets or Equity Interests in any Subsidiary of the Borrower consummated in accordance with the terms of Section 5.02(e) in an amount not to exceed with respect to any such sale or disposition the amount of gross proceeds received by the Borrower or any of its Subsidiaries in connection with such sale or disposition; (xii) Debt of the Borrower represented by letters of credit, surety bonds, Contingent Obligations and performance bonds supporting obligations of the Borrower or its Subsidiaries so long as, after giving effect to such letters of credit, surety bonds, Contingent Obligations and performance bonds (and the Investment represented thereby), the Borrower would be in compliance with Section 5.02(f); (xiii) reimbursement obligations owed to Affiliates for amounts paid on behalf of the Borrower or any of its Subsidiaries by the Parent or any of its Subsidiaries in accordance with applicable requirements under PUHCA with respect to the provision of goods or services to the Borrower or any such Subsidiary; (xiv) unsecured Debt of the Borrower and its Subsidiaries not to exceed $100,000,000 at any time outstanding; (xv) unsecured Debt in respect of obligations of the Borrower or any of its Subsidiaries to pay the deferred purchase price of goods or services or progress payments in connection with such goods and services; provided that with respect to any material invoice, such obligations are (A) incurred in connection with open accounts extended by suppliers on customary trade terms (which require that all such payments be made within 90 days of the incurrence of the related Debt) in the ordinary course of business and not in connection with the borrowing of money and (B)(I) not more than 90 days past due or (II) subject to any Contest, provided that the aggregate principal amount of such Debt subject to Contest shall not exceed $15,000,000; (xvi) Permitted Refinancing Debt incurred in respect of any Debt permitted under clauses (i), (ii), (iii), (vi), (vii), (viii), (xiv), (xx) and (xxiv) or this clause (xvi);

Debt. CreateThe Borrower shall not, nor shall it permit any Subsidiary to, create, assume, incur, assume or suffer to exist, or permit in any of its Subsidiaries to createmanner become liable, incurdirectly, assume indirectly, or suffer to existcontingently in respect of, any Debt other than:than the following (collectively, the “Permitted Debt”): (ia) In the case Debt of the Borrower, Debt in respect of Hedge Agreements designed to hedge against fluctuations in interest rates incurred in Credit Parties under 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 outstandingCredit Documents; (iib) 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 intercompany Debt incurred in the ordinary course of business subordinated to the Obligations on terms set forth in the Intercompany Subordination Agreement attached hereto as Exhibit K, evidenced by an Intercompany Note, and owed (i) by any Guarantor (other than Global Holdings and its Subsidiaries) to the Borrower; (ii) by the Borrower to any Guarantor (other than Global Holdings and its Subsidiaries); (iii) by any Guarantor (other than Global Holdings and its Subsidiaries) to another Guarantor; and (iv) by Global Holdings or any of its Subsidiaries to the Borrower or any of its other Subsidiaries to the extent such Debt is an Investment permitted under Section 6.3(c), (k) or (l); (c) Debt of Foreign Subsidiaries provided that the aggregate outstanding principal amount of such Debt shall not at any time exceed $5,000,000; (d) Debt incurred in the ordinary course of business to finance the payment of premiums for a 12 month period for insurance; provided that the deferred aggregate outstanding principal amount of such Debt shall not at any time exceed $5,000,000; (e) Debt (other than for borrowed money) subject to Liens permitted under Section 6.2(b) and (h); (f) Debt arising under any Hedging Arrangement permitted under Section 6.15; (g) unfunded Plan obligations or liabilities to the extent they are permitted to remain unfunded under applicable law; (h) Guarantees (i) of any Credit Party in respect of Debt of any Credit Party (other than Global Holdings and its Subsidiaries, except to the extent that the Debt incurred by Global Holdings and its Subsidiaries, were it guaranteed, would not exceed the amount of an Investment therein permitted under Section 6.3) otherwise permitted hereunder and (ii) of the Borrower or any Subsidiary in respect of Debt of Global Holdings or any of its Subsidiaries otherwise permitted hereby to the extent such Guarantees constitute Investments permitted under Section 6.3(c) or (k); (i) [Reserved]; (j) [Reserved]; (k) Debt incurred by the Borrower or its Subsidiaries in an Acquisition permitted under Section 6.4 consisting of agreements providing for indemnification, the adjustment of the purchase price of property or services, maturing within one year from the date created, and aggregating, on a Consolidated basis, similar adjustments (but not more than $7,500,000 at any one time outstanding,earnouts); (El) indorsement of negotiable instruments for deposit Debt arising under bid, performance, stay, customs, appeal and surety bonds, or collection with respect to workers’ compensation or similar transactions other like employee benefit claims, in each case incurred in the ordinary course of business, andand obligations in respect of letters of credit related thereto; (Fm) Debt existing on the Effective Date and set forth in Schedule 6.1 and any modifications, refinancings, extensions, renewals or replacements (but not the increase in the aggregate principal amount other than customary costs, expenses and premiums associated with such modifications, refinancings, extensions, renewals or replacements) thereof; (n) other Debt comprised in an aggregate principal amount outstanding (together with the principal amount of senior bank financing Debt outstanding pursuant to Section 6.1(c), (d) or (f)) at any time not to exceed $10,000,000; provided that if the Borrower creates, assumes, incurs, suffers to exist or otherwise becomes liable for secured Debt for borrowed money pursuant to this Section 6.1(n), the Weighted Average Yield applicable to such Debt shall not be greater than the applicable Weighted Average Yield payable pursuant to the terms of this Agreement as amended through the date of such calculation with respect to the Term Loans, unless the interest rate with respect to the Term Loans is increased so as to cause the then applicable Weighted Average Yield under this Agreement on the Term Loans to equal the Weighted Average Yield then applicable to such Debt; (o) unsecured Debt evidenced by the 2014 Notes and the 2014 Note Guaranties (including unsecured extensions, refinancings, refundings, replacements and renewals thereof); provided that, in the event of any such extension, refinancing, refunding, replacement or renewal, then (i) the scheduled maturity date of such Debt shall not be earlier than 180 days after the Stated Maturity Date, (ii) such Debt shall not have any amortization or other similar working capital financingrequirement to purchase, redeem, retire, defease or otherwise make any principal payment in respect thereof, other than at scheduled maturity thereof and mandatory prepayments or mandatory redemptions or puts triggered upon change in control, sale of all or substantially all assets and certain asset sales, in each case which are customary with respect to such type of Debt (and provided, for the avoidance of doubt, that payments of regularly scheduled interest shall be permitted with respect to such Debt so long as no Event of Default hereunder has occurred and is then continuing), (iii) the agreements and instruments governing such Debt shall not contain (A)(1) any financial maintenance covenants that are more restrictive than those in this Agreement, or (2) any other affirmative or negative covenants, defaults or events of default that are, taken as a whole, materially more restrictive than those, taken as a whole, set forth in this Agreement; provided that the inclusion of any Person covenant that becomes a is customary with respect to such type of Debt and that is not found in this Agreement shall not be deemed to be more restrictive for purposes of this clause (A), (B) any restriction on the ability of the Borrower or any of its Subsidiaries to amend, modify, restate or otherwise supplement this Agreement or the other Credit Documents, or (C)(1) any restrictions on the ability of any Subsidiary of the Borrower after to guarantee the Obligations (as such Obligations may be extended, renewed, rearranged, increased, amended, supplemented or otherwise modified from time to time), provided that a requirement that any such Subsidiary also guarantee such Debt shall not be deemed to be a violation of this clause (C), (2) any restrictions on the ability of any Subsidiary or the Borrower to pledge assets as collateral security for the Obligations (as such Obligations may be extended, renewed, rearranged, increased, amended, supplemented or otherwise modified from time to time), or (3) any restrictions on the ability of any Subsidiary or the Borrower to incur Debt under this Agreement or any other Credit Document; provided that, any restriction as to the entry into any such guaranty or pledge of assets or incurrence of such Debt under this Agreement that is not materially more restrictive than those set forth in the agreements and instruments governing the 2014 Notes as in effect on the Effective Date shall not be deemed to be a restriction for purposes of this clause (C), (iv) any such Debt is in an aggregate principal amount not greater than the aggregate principal amount of the Debt being extended, refinanced, refunded, replaced or renewed, plus all accrued interest thereon, the amount of any premiums required to be paid thereon and all fees and expenses associated therewith or with the extension, refinancing, refunding, replacement or renewal and (v) if such extension, refinancing, refunding, replacement or renewal of Debt occurs on or before September 30, 2020, then the Weighted Average Yield of such Debt shall not exceed 11% per annum; (p) [Reserved]; and (q) Debt under the ABL Credit Documents as in effect on the date hereof hereof, or as amended, restated, supplemented or otherwise modified in accordance with Section 6.20(b), and any extensions, refinancings, refundings, replacements and renewals in respect thereof made in accordance with such Section 6.20(b) and the terms of Section 5.02Intercreditor Agreement, so long as, in each case, such Debt is subject to the Intercreditor Agreement.

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.