Exhibit 10.1

CREDIT AGREEMENT

dated as of

3 August 2006

among

SAFETY-KLEEN HOLDCO., INC.,

as “Holdings,”

SAFETY-KLEEN SYSTEMS, INC.

as the borrower,

the lenders party hereto

and

JPMORGAN CHASE BANK, NATIONAL ASSOCIATION

as Administrative Agent

CREDIT SUISSE

as syndication agent

and

NEXBANK SSB and WACHOVIA BANK, NATIONAL ASSOCIATION

as co-documentation agents

▇.▇. ▇▇▇▇▇▇ SECURITIES INC.

and

CREDIT SUISSE SECURITIES (USA) LLC,

as Joint Bookrunners and Co-lead Arrangers

Table of Contents

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CREDIT AGREEMENT dated as of August 3, 2006 among SAFETY-KLEEN HOLDCO., INC. (“Holdings”), SAFETY-KLEEN SYSTEMS, INC., (“Borrower”), the LENDERS party hereto, and JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, as Administrative Agent.

The parties hereto agree as follows:

ARTICLE I.

Definitions

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

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

“Act” has the meaning assigned to such term in Section 10.19.

“Actual Return” has the meaning assigned to such term in Section 2.12(c).

“Adjusted Capital Expenditures” has the meaning assigned to such term in Section 7.03.

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

“Administrative Agent” means JPMCB in its capacity as administrative agent for the Lenders hereunder.

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

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

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

“Applicable Percentage” means: (a), with respect to any Revolving Lender, the percentage of the total Revolving Commitments represented by such Lender’s Revolving Commitment and (b), with respect to any Synthetic L/C Lender, the percentage of the total Synthetic L/C Commitments represented by such Lender’s Synthetic L/C Commitment.  If the applicable Commitments have terminated or expired, the Applicable Percentages shall be determined based upon the applicable Commitments most recently in effect, giving effect to any assignments.

“Applicable Rate” means, for any day:  (a) with respect to each Term Loan, 1.50% per annum, in the case of an ABR Loan and 2.50% per annum, in the case of a Eurodollar Loan (provided that the foregoing percentages are subject to adjustment as contemplated by Section 2.20(f) hereof), (b) in the

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case of Synthetic L/C Loans, 2.50% (provided that the foregoing percentage is subject to adjustment as contemplated by Section 2.20(f) hereof) and (c) with respect to any ABR Loan or Eurodollar Loan that is a Revolving Loan, or with respect to the commitment fees payable hereunder, as the case may be, the applicable rate per annum set forth below under the caption “ABR Spread”, “Eurodollar Spread” or “Commitment Fee Rate”, as the case may be, based upon the Leverage Ratio as of the most recent determination date; provided that until first adjusted under the terms of this definition below, the “Applicable Rate” for purposes of clause (c) shall be the applicable rate per annum set forth below in Category 2:

For purposes of the foregoing, (i) the Leverage Ratio shall be determined as of the end of each fiscal quarter of Holdings’ fiscal year commencing with the third fiscal quarter of Holdings’ 2006 fiscal year, based upon Holdings’ consolidated financial statements delivered pursuant to Section 5.01(a) or (b) and (ii) each change in the Applicable Rate resulting from a change in the Leverage Ratio shall be effective during the period commencing on and including the date of delivery to the Administrative Agent of such consolidated financial statements indicating such change and ending on the date immediately preceding the effective date of the next such change; provided that the Leverage Ratio shall be deemed to be in Category 1 at the option of the Administrative Agent or at the request of the Required Lenders (A) if at any time that an Event of Default exists or (B)  if Holdings fails to deliver the consolidated financial statements required to be delivered by it pursuant to Section 5.01(a) or (b), during the period from the expiration of the time for delivery thereof until such consolidated financial statements are delivered.  Notwithstanding the foregoing provisions of this definition, if an Increased Commitment Supplement provides for different Applicable Rates to apply to the Incremental Term Loan that is the subject of such Increased Commitment Supplement, the Applicable Rates for such Incremental Term Loan shall be as provided in its Increased Commitment Supplement.

“Approved Fund” has the meaning assigned to such term in Section 10.04.

“Assignment and Assumption” means an Assignment and Assumption entered into by a Lender and an assignee (with the consent of any party whose consent is required by Section 10.04), and accepted by the Administrative Agent, in the form of Exhibit A or any other form approved by the Administrative Agent.

“Assignment of Lien” means an Assignment of Lien in form satisfactory to the Administrative Agent pursuant to which the Existing Mortgages and other Liens securing the Existing Credit Facility are assigned to the Administrative Agent.

“Benchmark LIBOR Rate” has the meaning assigned to such term in Section 2.05(e)(i)(D).

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

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“Borrower” means Safety-Kleen Systems, Inc., a Wisconsin corporation.

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

“Borrowing Request” means a request by the Borrower for a Borrowing in accordance with Section 2.03.

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

“Capital Expenditure Limit” has the meaning assigned to such term in Section 7.03.

“Capital Expenditures” means, for any period and a Person, (a) the additions to property, plant and equipment and other capital expenditures of such Person and its consolidated subsidiaries that are (or would be) set forth in a consolidated statement of cash flows of such Person for such period prepared in accordance with GAAP and (b) Capital Lease Obligations incurred by such Person and its consolidated subsidiaries during such period.

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

“Carryover Amount” has the meaning assigned to such term in Section 7.03.

“Change in Control” means: (a) the acquisition of ownership, directly or indirectly, beneficially or of record, by any Person other than Holdings of any Equity Interest in SK Holding; (b) the acquisition of ownership, directly or indirectly, beneficially or of record, by any Person other than SK Holding of any Equity Interest in Borrower; (c) prior to an initial public offering of the common stock of Holdings (an “IPO”), the acquisition of ownership, directly or indirectly, beneficially or of record, by any “person” or “group” (within the meaning of the Securities Exchange Act of 1934 and the rules of the Securities and Exchange Commission thereunder as in effect on the date hereof) of Equity Interests representing more than 45% (on a fully diluted basis) of either the aggregate ordinary voting power or the aggregate equity value represented by the issued and outstanding Equity Interests in Holdings; (d) after an IPO, the acquisition of ownership, directly or indirectly, beneficially or of record, by any Person or group (within the meaning of the Securities Exchange Act of 1934 and the rules of the Securities and Exchange Commission thereunder as in effect on the date hereof) of Equity Interests representing more than 35% (on a fully diluted basis) of either the aggregate ordinary voting power or the aggregate equity value represented by the issued and outstanding Equity Interests in Holdings; or (e) the occupation of a majority of the seats (other than vacant seats) on the board of directors of Holdings by Persons who were neither (i) nominated by the board of directors of Holdings nor (ii) appointed by directors so nominated.

“Change in Law” means (a) the adoption of any law, rule or regulation after the date of this Agreement, (b) any change in any law, rule or regulation or in the interpretation or application thereof by any Governmental Authority after the date of this Agreement or (c) compliance by any Lender or the Issuing Bank (or, for purposes of Section 2.15(b), by any lending office of such Lender or by such

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Lender’s or the Issuing Bank’s holding company, if any) with any request, guideline or directive (whether or not having the force of law) of any Governmental Authority made or issued after the date of this Agreement.

“Class”, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are Revolving Loans, Synthetic L/C Loans, Term B Loans, Incremental Term Loans or Swingline Loans and, when used in reference to any Commitment, refers to whether such Commitment is a Revolving Commitment, Synthetic L/C Commitment, Term B Commitment or an Incremental Term Commitment.

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

“Collateral” means the Mortgaged Property, the “Collateral” as defined in the Security Agreement and any and all property in which Liens have been granted to the Administrative Agent to secure the Obligations.

“Commitment” means a Revolving Commitment, Synthetic L/C Commitment, Term B Commitment, or Incremental Term Loan Commitment or any combination thereof (as the context requires).

“Consolidated Adjusted EBITDA” means, for any period (the “Subject Period”), the total of the following calculated without duplication for such period:  (a) Consolidated EBITDA; plus (b), on a pro forma basis, the pro forma EBITDA of each Prior Target or, as applicable, the EBITDA of a Prior Target attributable to the assets acquired from such Prior Target, for any portion of such Subject Period occurring prior to the date of the acquisition of such Prior Target or the related assets but only to the extent such EBITDA for such Prior Target can be established in a manner satisfactory to the Administrative Agent based on financial statements of the Prior Target prepared in accordance with GAAP and taking into account only factually supportable and identifiable cost savings and expenses directly attributable to any such acquisition which would otherwise be accounted for as an adjustment pursuant to Article 11 of Regulation S-X under the Securities Act, as if such cost savings or expenses were realized on the first day of the applicable period; minus (c) the EBITDA of each Prior Company and, as applicable but without duplication, the Consolidated EBITDA attributable to all Prior Assets, in each case for any portion of such Subject Period occurring prior to the date of the disposal of such Prior Companies or Prior Assets.  As used in this definition, the following terms have the following meanings:

“EBITDA” means, for any period and any Person, the total of the following each calculated without duplication on a consolidated basis for such period:  (a) the consolidated operating net income of such Person; plus (b) any provision for (or less any benefit from) income or franchise taxes included in determining such consolidated operating net income; plus (c) interest expense (including the interest portion of Capital Lease Obligations) deducted in determining such consolidated operating net income; plus (d) amortization and depreciation expense deducted in determining such consolidated operating net income.

“Prior Target” means all Targets acquired or whose assets have been acquired in a transaction permitted by Section 6.04.

“Prior Company” means any Subsidiary whose capital stock or other Equity Interests have been disposed of, or all or substantially all of whose assets have been disposed of, in each case, in a transaction with an unaffiliated third party permitted or approved in accordance with this Agreement.

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“Prior Assets” means assets that have been disposed of by a division or branch of Holdings or a Subsidiary in a transaction with an unaffiliated third party permitted or approved in accordance with this Agreement which would not make the seller a “Prior Company” but constitute all or substantially all of the assets of such division or branch.

“Consolidated Assets” means, at any time, all amounts which in conformity with GAAP would be included as assets on a consolidated balance sheet of Holdings at such time.

“Consolidated Cash Interest Expense” shall mean, for any period, the sum of the total consolidated interest expense of Holdings and the Subsidiaries for such period (for this purpose, excluding that portion of interest expense which is capitalized and/or paid-in-kind through the issuance of Indebtedness in the same form as the Indebtedness with respect to which such interest is required to be paid in accordance with the terms thereof, and so long as such interest shall not be paid in cash (until the maturity of the respective Indebtedness and so long as same does not occur in such period)) plus, without duplication: (i) that portion of Capital Lease Obligations of Holdings and the Subsidiaries representing the interest factor for such period, (ii) all fees accrued during such period pursuant to Sections 2.12(a), (b) and (c), (iii) all interest expense during such period accrued under the terms of Sections 2.05(i), (iv) the interest component (or imputed interest) of any lease payment or other off-balance sheet financing transactions of the type described in clause (n) of the definition of the term “Indebtedness” paid by Holdings and the Subsidiaries for such period, and (v) all expenses (or minus any income) arising in connection with any Swap Agreement that is included as interest expense in accordance with GAAP; provided that (i) the amortization or write-off of deferred financing, legal and accounting costs with respect to the Transactions in each case shall be excluded from Consolidated Cash Interest Expense to the extent same would otherwise have been included therein and (ii) for purposes of the calculations under Section 7.02, Consolidated Cash Interest Expense for the quarter ended on: (a) October 8, 2005 shall equal $5,140,000; (b) December 31, 2005 shall equal $5,140,000; (c) April 22, 2006 shall equal $6,850,000; and (d) July 15, 2006 shall equal $5,140,000.

“Consolidated EBITDA” shall mean, for any period, Consolidated Net Income for such period adjusted by:

(a)                                  adding thereto, without duplication and to the extent deducted in arriving at Consolidated Net Income for such period:

(i)                                     the total consolidated interest expense of Holdings and the Subsidiaries for such period (including all such interest expenses arising in connection with any Swap Agreement) determined in accordance with GAAP;

(ii)                                  provision for taxes based on income;

(iii)                               the amount of all amortization of intangibles and depreciation;

(iv)                              non-cash charges for the impairment of goodwill or other intangibles or the write-off of goodwill, intangibles or other assets;

(v)                                 the amortization or write-off of deferred financing, legal, accounting costs and prepayment fees with respect to the Transactions;

(vi)                              the “Provision for Environmental Liabilities” or substantially similar provision (however designated) on Holdings’ financial statements prepared in a manner consistent with the audited financial statements furnished prior to

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the Effective Date and described in Section 3.04(a) (the “Provision for Environmental Liabilities”);

(vii)                           the one-time charges attributable to termination of any or all services provided under a Master Service Agreement with Electronic Data Systems Corporation and EDS Information Services L.L.C. dated April 26, 2002 to the extent taken in the applicable period; provided that the aggregate amount of such charges added back in determining Consolidated EBITDA shall not exceed $10,000,000 for all such periods;

(viii)                        non-cash vacation expenses;

(ix)                                non-cash impairment losses and losses on the disposition of equipment at customers;

(x)                                   non-cash expenses for stock option issuances, restricted stock issuances and other equity issuances and exercises; and

(xi)                                non-cash losses under Swap Agreements;

(xii)                             non-cash amortization or write off of the discounts arising as a result of the original issuance of the Take Back Notes; and

(b)           deducting therefrom, without duplication, (i) the amount of all cash payments during such period that are associated with any non-cash charges or non-cash losses that were added back to Consolidated Net Income in a previous period pursuant to preceding clauses (a)(viii), (ix), (x) and (xi); (ii) any cash payments made during such period that reduce the Provision for Environmental Liabilities (as defined above in this definition) for such period except to the extent that the same constitute Environmental Liability Expenditures; and (iii) to the extent the same increased Consolidated Net Income for such period, non-cash gains under Swap Agreements;

and, in each case, calculated without giving effect to (and excluding) (i) non-operating income items referred to as “Other Income or Expense” (as such term is used and reported on in the most recent audited financial statements described in Section 3.04(a)), (ii) any extraordinary gains or losses and (iii) any gains or losses from sales or other dispositions of assets other than from sales of inventory in the ordinary course of business.

“Consolidated Indebtedness” shall mean, at any time, the remainder of the sum of, without duplication: (i) all Indebtedness of Holdings and the Subsidiaries (on a consolidated basis) as would be required to be reflected as debt or Capital Lease Obligations on the liability side of a consolidated balance sheet of Holdings and the Subsidiaries in accordance with GAAP, (ii) all Indebtedness of Holdings and the Subsidiaries of the type described in clause (n) of the definition thereof and (iii) all obligations in respect of the Guarantees of Holdings and the Subsidiaries in respect of Indebtedness of any third Person of the type referred to in preceding clauses (i) and (ii).

“Consolidated Net Income” shall mean, for any period, the net income (or loss) of Holdings and the Subsidiaries for such period, determined on a consolidated basis (after any deduction for minority interests) and in accordance with GAAP, provided that:

(a)                                  in determining Consolidated Net Income, the net income of any other Person which is not a subsidiary of Holdings or that is accounted for by Holdings by the

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equity method of accounting shall be included only to the extent of the payment of cash dividends or cash distributions by such other Person to Holdings or a Subsidiary during such period; provided further that the net income of The ArmaKleen Company (“ArmaKleen”) may be included therein so long as (i) Holdings owns directly or indirectly, through one or more of the Subsidiaries, at least 50% of the Equity Interests of ArmaKleen and (ii) Holdings accounts for the net income of ArmaKleen in the same manner as such net income is accounted for by Holdings on the Effective Date as shown in the most recent audited financial statements described in Section 3.04(a); and

(b)                                 the net income of any Subsidiary shall be excluded to the extent that the declaration or payment of cash dividends or similar cash distributions by that Subsidiary of that net income is not at the date of determination permitted by operation of its charter or any agreement, instrument or law applicable to such Subsidiary;

provided that any net income excluded under clause (a) or (b) above in any period (to the extent that such net income otherwise would have been included in the Consolidated Net Income of Holdings in such period) shall be included in any subsequent period to the extent of any cash dividend or cash distribution of such net income in such subsequent period made by such Person to Holdings or a subsidiary thereof (provided the net income of such Subsidiary is not restricted as set forth in clause (b) above).

“Contract Rate” has the meaning assigned to such term in Section 10.13(a).

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

“Credit Linked Account” with respect to each Synthetic L/C Lender, the account established by the Administrative Agent at JPMCB in the name of such Lender pursuant to Section 2.05(e)(i)(A).

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

“Departing Agent” has the meaning assigned to such term in the definition of the term Loan Documents.

“Deposit Obligations” means all obligations, indebtedness, and liabilities of Holdings and the Subsidiaries, or any one of them, to any Lender or any Affiliate of any Lender arising pursuant to any deposit, lock box, automated clearing house or cash management arrangements entered into by any Lender or any Affiliate of any Lender with Holdings or any Subsidiary, whether now existing or hereafter arising, whether direct, indirect, related, unrelated, fixed, contingent, liquidated, unliquidated, joint, several, or joint and several, including, without limitation, the obligation, indebtedness, and liabilities of Holdings or any Subsidiary to repay any credit extended in connection with such arrangements, interest thereon, and all fees, costs, and expenses (including attorneys’ fees and expenses) provided for in the documentation executed in connection therewith.

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

“Dollar Equivalent” of any amount means, at the time of determination thereof: (a) if such amount is expressed in dollars, such amount and (b) if such amount is expressed in a currency other than dollars, the equivalent of such amount in dollars determined using the rate of exchange quoted by JPMCB in New York, New York at 11:00 a.m. (New York, New York time) on the date of determination (or, if such date is not a Business Day, the last Business Day prior thereto) to prime banks in New York for the

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spot purchase in the New York foreign exchange market of such amount of dollars with such other currency.

“Domestic Subsidiary” means any Subsidiary that is organized under the laws of the United States of America, any state thereof or the District of Columbia.

“Effective Date” means the date on which the conditions specified in Section 4.01 are satisfied (or waived in accordance with Section 10.02).

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

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

“Environmental Liability Expenditures” means all expenditures associated with the performance of Remedial Actions.

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

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

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

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

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“Eurodollar”, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are bearing interest at a rate determined by reference to the Adjusted LIBO Rate but not the One Month Adjusted LIBO Rate.  Synthetic L/C Loans are not be Eurodollar Loans.

“Event of Default” has the meaning assigned to such term in Section 8.01.

“Excess Cash Flow “ means, for any period, the remainder of:

(a)           Consolidated EBITDA for such period minus

(b)           the sum of, without duplication:

(i)            the aggregate amount of all Capital Expenditures made by Holdings and the Subsidiaries during such period (other than Capital Expenditures to the extent financed with proceeds from the issuance of Equity Interests, asset sale proceeds, insurance proceeds or Indebtedness (other than Revolving Loans));

(ii)           the aggregate amount of permanent principal payments of Indebtedness for borrowed money of Holdings and the Subsidiaries and the permanent repayment of the principal component of Capital Lease Obligations of Holdings and the Subsidiaries during such period (other than (A) repayments made with the proceeds of asset sales, equity issuances and issuance of Indebtedness (other than Revolving Loans) and (B) re-payments of Loans and/or other Loan Obligations, provided that repayments of Loans shall be deducted in determining Excess Cash Flow to the extent such repayments were (1) required as a result of a scheduled repayment pursuant to Section 2.10 or with respect to an Incremental Term Loan, its Increased Commitment Supplement, or (2) made as a voluntary prepayment pursuant to Section 2.11(a) with internally generated funds (but in the case of a voluntary prepayment of Revolving Loans and Swingline Loans, only to the extent accompanied by a voluntary reduction to the aggregate amount of the Revolving Commitments in an amount equal to such prepayment and in the case of a voluntary prepayment of the Synthetic L/C Loans, only to the extent accompanied by a voluntary reduction to the aggregate amount of the Synthetic L/C Commitments in an amount equal to such prepayment));

(c)           Consolidated Cash Interest Expense for such period;

(d)           payments of taxes based on income (excluding income from asset sales, the receipt of insurance proceeds and similar events) paid in cash during such period;

(e)           payments made pursuant to Section 10.03 hereof during such period, in each case, to the extent not already deducted in the calculation of Consolidated EBITDA;

(f)            Environmental Liability Expenditures paid in cash during such period, to the extent same did not already reduce Consolidated EBITDA;

(g)           the one-time charges attributable to the termination of any or all services provided under a Master Service Agreement with Electronic Data Systems Corporation and EDS Information Services L.L.C. dated April 26, 2002 to the extent same did not already reduce Consolidated EBITDA; and

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(h)           the aggregate amount of all cash payments made in respect of all acquisitions permitted by Section 6.04 consummated by the Borrower and the Subsidiaries during such period (other than any such payments to the extent financed with equity proceeds, asset sale proceeds, insurance proceeds or Indebtedness (other than Revolving Loans)).

“Excluded Foreign Subsidiary” means (i) a Foreign Subsidiary, or (ii) an entity treated as disregarded for U.S. federal income tax purposes that owns more than 65% of the voting stock of a Subsidiary described in clauses (i) or (ii) of this definition.

“Excluded Taxes” means, with respect to the Administrative Agent, any Lender, the Issuing Bank or any other recipient of any payment to be made by or on account of any obligation of the Borrower hereunder, (a) income or franchise taxes imposed on (or measured by) its net income by the United States of America, or by the jurisdiction under the laws of which such recipient is organized or in which its principal office is located or in which it is otherwise treated as doing business (other than a jurisdiction in which it would not have been treated as doing business but for and solely as a result of its participation in the transactions governed by the Loan Documents), or in the case of any Lender, in which its applicable lending office is located, (b) any branch profits taxes imposed by the United States of America or any similar tax imposed by any other jurisdiction in which the Borrower is located, (c) in the case of any Lender (other than an assignee pursuant to a request by the Borrower under Section 2.19(b)), any withholding tax that is imposed on amounts payable to such Lender at the time such Lender becomes a party to this Agreement (or designates a new lending office) or is attributable to such Lender’s failure to comply with Section 2.17(e), except to the extent that such Lender (or its assignor, if any) was entitled, at the time of designation of a new lending office (or assignment), to receive additional amounts from the Borrower with respect to such withholding tax pursuant to Section 2.17(a), (d) taxes imposed by the United States of America that arise as a result of the failure of the recipient of the applicable payment to comply with Section 2.17(e), (e) backup withholding taxes imposed by the Unties States of America and (f) any taxes (including interest and penalties) that are attributable to a Lender’s or the Administrative Agent’s gross negligence or willful misconduct.

“Existing Credit Facility” means the credit facility provided under the terms of that certain Credit Agreement dated as of April 7, 2005 among Holdings, certain of the Subsidiaries, the lenders named therein, Deutsche Bank Trust Company Americas, as administrative agent and Credit Suisse First Boston, as syndication agent.

“Existing Mortgages” means the mortgages and deeds of trust described on Schedule 1.01(b).

“fair value” has the meaning assigned to such term in Section 3.15.

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

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

“Fixed Return” has the meaning assigned to such term in Section 2.12(c).

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

“Foreign Subsidiary” means any Subsidiary that is organized under the laws of a jurisdiction other than the United States of America or any State thereof or the District of Columbia.

“Fully Satisfied” or “Full Satisfaction” means, as of any date, that on or before such date:

(a)           with respect to the Loan Obligations:  (i) the principal of and interest accrued to such date on the Loan Obligations (other than the contingent L/C Exposure) shall have been paid in full in cash, (ii) all fees, expenses and other amounts then due and payable which constitute Loan Obligations (other than the contingent L/C Exposure and other contingent amounts not then liquidated) shall have been paid in full in cash, (iii) the Commitments shall have expired or irrevocably been terminated, and (iv) the contingent L/C Exposure shall have been secured by: (A) the grant of a first priority, perfected Lien on cash or cash equivalents in an amount at least equal to 102% of the amount of such L/C Exposure or other collateral which is reasonably acceptable to the Issuing Bank or (B) the issuance of a “back-to-back” letter of credit in form and substance reasonably acceptable to the Issuing Bank with an original face amount at least equal to 102% of the amount of such L/C Exposure;

(b)           with respect to the Swap Obligations (i) all termination payments, fees, expenses and other amounts then due and payable under the related Swap Agreements which constitute Swap Obligations shall have been paid in full in cash; and (ii) all contingent amounts which could be payable under the related Swap Agreements shall have been secured by: (A) the grant of a first priority, perfected Lien on cash or cash equivalents in an amount at least equal to 102% of the amount of such contingent Swap Obligations or other collateral which is reasonably acceptable to the Person holding the applicable Swap Obligations or (B) the issuance of a letter of credit in form and substance reasonably acceptable to the Person holding the applicable Swap Obligations and in an amount at least equal to 102% of the amount of such contingent Swap Obligations; and

(c)           with respect to the Deposit Obligations:  (i) all fees, expenses and other amounts then due and payable which constitute Deposit Obligations shall have been paid in full in cash, (ii) any further commitments to extend credit in connection with such Deposit Obligations shall have expired or irrevocably been terminated or reasonably satisfactory arrangements to secure the same shall be made with the depository bank, and (iii) all contingent amounts which could be payable in connection with the Deposit Obligations shall have been secured by: (A) the grant of a first priority, perfected Lien on cash or cash equivalents in an amount at least equal to 102% of the amount of such contingent Deposit Obligations or other collateral which is acceptable to the Lender or Affiliate of a Lender holding the applicable Deposit Obligations or (B) the issuance of a letter of credit in form and substance reasonably acceptable to the Lender or Affiliate of a Lender holding the applicable Deposit Obligations and in an amount at least equal to 102% of the amount of such contingent Deposit Obligations.

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

“Governmental Authority” means the government of the United States of America, any other nation or any political subdivision thereof, whether state or local, and any agency, authority,

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instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.

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

“Guaranty Agreement” means the guaranty of Holdings and the Subsidiary Loan Parties in the form of Exhibit C hereto.

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

“Holdings” means Safety-Kleen HoldCo., Inc., a Delaware corporation.

“Increased Amount” has the meaning assigned to such term in Section 2.20(b).

“Increased Commitment Supplement” means the Increased Commitment Supplement in the form attached hereto as Exhibit D.

“Incremental Term Lender” means, with respect to an Incremental Term Loan, a Lender who has agree to make such Loan under the terms of the related Increased Commitment Supplement.

“Incremental Term Loan” means a term loan made to Borrower pursuant to an Increased Commitment Supplement.

“Incremental Term Loan Commitment” means, with respect to each Lender, the commitment of such Lender, if any, to make an Incremental Term Loan in the amount set forth in the applicable Increased Commitment Supplement.

“Indebtedness” of any Person means, without duplication, (a) all obligations of such Person for borrowed money; (b) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments; (c) all obligations of such Person upon which interest charges are customarily paid; (d) all obligations of such Person under conditional sale or other title retention agreements relating to property acquired by such Person; (e) all obligations of such Person in respect of the deferred purchase price of property or services (excluding current accounts payable incurred in the ordinary course of business); (f) all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed (provided that if the Person has not assumed or otherwise become liable in respect of such Indebtedness, such Indebtedness shall be deemed

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to be in an amount equal to the fair market value of the property to which such Lien relates as determined in good faith by such Person); (g) all Guarantees by such Person; (h) all Capital Lease Obligations of such Person; (i) all obligations, contingent or otherwise, of such Person as an account party in respect of letters of credit and letters of guaranty; (j) all obligations, contingent or otherwise, of such Person in respect of bankers’ acceptances; (k) all obligations of such Person in respect of mandatory redemption or mandatory dividend rights on Equity Interests but excluding dividends payable solely in additional Equity Interests; (1) all obligations of such Person, contingent or otherwise, for the payment of money under any noncompete, consulting or similar agreement entered into with the seller of a Target or any other similar arrangements providing for the deferred payment of the purchase price for an acquisition permitted hereby or an acquisition consummated prior to the date hereof; (m) all obligations of such Person under any Swap Agreement; (n) all obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which lease is required or is permitted to be classified and accounted for as an operating lease under GAAP but which is intended by the parties thereto for tax, bankruptcy, regulatory, commercial law, real estate law and all other purposes as a financing arrangement; and (o) all other amounts (other than accruals, deferred revenue and deferred taxes) which are required by GAAP to be included as liabilities on a consolidated balance sheet of such Person.  The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such entity, except to the extent the terms of such Indebtedness provide that such Person is not liable therefor.  The amount of the obligations of Holding or any Subsidiary in respect of any Swap Agreement shall, at any time of determination and for all purposes under this Agreement, be the maximum aggregate amount (giving effect to any netting agreements) that Holding or such Subsidiary would be required to pay if such Swap Agreement were terminated at such time giving effect to current market conditions notwithstanding any contrary treatment in accordance with GAAP.

“Indemnified Taxes” means Taxes other than Excluded Taxes.

“Indemnitee” has the meaning assigned to such term in Section 10.03(b).

“Information” has the meaning assigned to such term in Section 10.12.

“Information Memorandum” means the Confidential Information Memorandum dated June 2006 relating to the Borrower and the Transactions.

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

“Interest Payment Date” means (a) with respect to any ABR Loan (other than a Swingline Loan) and any Synthetic L/C Loan, the first Business Day of each January, April, July and October, (b) with respect to any Eurodollar Loan, the last day of the Interest Period applicable to the Borrowing of which such Loan is a part and, in the case of a Eurodollar Borrowing with an Interest Period of more than three months’ duration, each day prior to the last day of such Interest Period that occurs at intervals of three months’ duration after the first day of such Interest Period, and (c) with respect to any Swingline Loan, the day that such Loan is required to be repaid.

“Interest Period” means:

(a)           with respect to any Eurodollar Borrowing, the period commencing on the date of such Borrowing and ending on the numerically corresponding day in the calendar month that is one, two, three or six months thereafter, as the Borrower may elect; and

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(b)           with respect to any Synthetic L/C Borrowing, the period commencing on the first day of a calendar month and ending on the last day of a calendar month;

provided, that (i) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless, such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day and (ii) any Interest Period that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of such Interest Period.  For purposes hereof, the date of a Borrowing initially shall be the date on which such Borrowing is made and thereafter shall be the effective date of the most recent conversion or continuation of such Borrowing.

“Issuing Bank” means JPMCB, in its capacity as the issuer of Letters of Credit hereunder, and its successors in such capacity as provided in Section 2.05(i).  The Issuing Bank may, in its discretion, arrange for one or more Letters of Credit to be issued by Affiliates of the Issuing Bank, in which case the term “Issuing Bank” shall include any such Affiliate with respect to Letters of Credit issued by such Affiliate and the terms and provisions hereof applicable to any such Letter of Credit issued by such Affiliate shall be binding upon such Affiliate.

“JPMCB” means JPMorgan Chase Bank, National Association in its individual capacity and not as Administrative Agent.

“L/C Disbursement” means either a Revolving L/C Disbursement or a Synthetic L/C Disbursement.

“L/C Exposure” means the Revolving L/C Exposure and the Synthetic L/C Exposure.

“Lenders” means (a) for all purposes, the Persons listed on Schedule 2.01 and any other Person that shall have become a party hereto pursuant to an Increased Commitment Supplement or an Assignment and Assumption, other than any such Person that ceases to be a party hereto pursuant to an Assignment and Assumption or otherwise and (b) for purposes of the definitions of “Swap Obligations” and “Secured Parties” only, shall include any Person who was a Lender at the time a Swap Agreement was entered into by one or more of the Loan Parties, even though, at a later time of determination, such Person no longer holds any Commitments or Loans hereunder.  Unless the context otherwise requires, the term “Lenders” includes the Swingline Lender and the Incremental Term Lenders.  As a result of clause (b) of this definition, the Swap Obligations owed to a Lender or its Affiliates shall continue to be “Swap Obligations”, entitled to share in the benefits of the Collateral as herein provided, even though such Lender ceases to be a party hereto pursuant to an Assignment and Assumption or otherwise.

“Letter of Credit” means any Revolving Letter of Credit or any Synthetic Letter of Credit.

“Leverage Ratio” means, on any date, the ratio of Consolidated Indebtedness outstanding as of such date to the Consolidated Adjusted EBITDA as calculated for the four fiscal quarters then most recently ended for which financial statements are available.

“LIBO Rate” means, with respect to any Eurodollar Borrowing for any Interest Period and with respect to the One Month Adjusted LIBO Rate, the rate appearing on Page 3750 of the Dow ▇▇▇▇▇ Market Service (or on any successor or substitute page of such Service, or any successor to or substitute for such Service, providing rate quotations comparable to those currently provided on such page of such Service, as determined by the Administrative Agent from time to time for purposes of providing quotations of interest rates applicable to dollar deposits in the London interbank market) at approximately 11:00 a.m., London time, two Business Days prior to the commencement of the applicable Interest Period, as the rate

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for dollar deposits with a maturity comparable to the applicable Interest Period.  In the event that such rate is not available at such time for any reason, then the “LIBO Rate” with respect to the applicable Interest Period shall be the rate at which dollar deposits of $5,000,000 and for a maturity comparable to such Interest Period are offered by the principal London office of the Administrative Agent in immediately available funds in the London interbank market at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period.

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

“Loan Documents” means this Agreement, the Guaranty Agreement, the Security Agreement, the Mortgages and all other certificates, agreements and other documents or instruments now or hereafter executed and/or delivered pursuant to or in connection with the foregoing.  For purposes of 10.03 only, the term “Loan Document” includes the payoff letter executed by Deutsche Bank Trust Company Americas, as administrative agent and collateral agent under the Existing Credit Facility (the “Departing Agent”), which payoff letter has been agreed to by the Borrower, certain of the Guarantors and certain other Affiliates of the Borrower and the Administrative Agent and provides for the payoff of the obligations outstanding thereunder, the assignment to the Administrative Agent of the Existing Mortgages and the indemnification by the Administrative Agent of the Departing Agent, each of the other agents under the Existing Credit Facility and each of the lenders under the Existing Credit Facility for matters relating to the payoff and such assignment.

“Loan Obligations” means all obligations, indebtedness, and liabilities of Holdings and the  Subsidiaries, or any one of them, to the Administrative Agent and the Lenders arising pursuant to any of the Loan Documents, whether now existing or hereafter arising, whether direct, indirect, related, unrelated, fixed, contingent, liquidated, unliquidated, joint, several, or joint and several, including, without limitation, the obligation of Holdings or any Subsidiary to repay the Loans, the L/C Disbursements, interest on the Loans and L/C Disbursements, and all fees, costs, and expenses (including attorneys’ fees and expenses) provided for in the Loan Documents.

“Loan Parties” means Holdings, the Borrower and the Subsidiary Loan Parties.

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

“Material Adverse Effect” means a material adverse effect on (a) the business, assets, prospects or condition, financial or otherwise, of Holdings and the Subsidiary Loan Parties taken as a whole, (b) the validity or enforceability of any Loan Document or (c) the rights of or remedies available to the Lenders under any Loan Document.

“Material Indebtedness” means Indebtedness (other than the Loans and Letters of Credit but including, without limitation, obligations in respect of one or more Swap Agreements) of any one or more of Holdings and the Subsidiaries in an aggregate principal amount exceeding $10,000,000.

“Material Real Property” shall mean any real property owned by any of the Loan Parties the fair market value of which (as determined in good faith by Borrower) is greater than $1,000,000.

“Maximum Rate” has the meaning assigned to such term in Section 10.13(a).

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

“Mortgage” means a mortgage, deed of trust, assignment of leases and rents, leasehold mortgage or other security document granting a Lien on any Mortgaged Property to secure the Obligations.  Each Mortgage shall be satisfactory in form and substance to the Administrative Agent.  The term “Mortgage” shall include the Existing Mortgages as the same have been assigned to the Administrative Agent pursuant to the Assignment of Lien.

“Mortgaged Property” means, initially, each parcel of real property and the improvements thereto owned by a Loan Party and identified on Schedule 1.01(a), and includes each other parcel of real property and improvements thereto with respect to which a Mortgage is granted pursuant to Section 5.12.

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

“Net Proceeds” means, with respect to any event (a) the cash proceeds received in respect of such event including (i) any cash received in respect of any non-cash proceeds, but only as and when received, (ii) in the case of a casualty, insurance proceeds, and (iii) in the case of a condemnation or similar event, condemnation awards and similar payments, net of (b) the sum of (i) all reasonable fees and out-of-pocket expenses paid by Holdings and the Subsidiaries to third parties (other than Affiliates) in connection with such event, (ii) in the case of a sale, transfer or other disposition of an asset (including pursuant to a sale and leaseback transaction or a casualty or a condemnation or similar proceeding), the amount of all payments required to be made by Holdings and the Subsidiaries as a result of such event to repay Indebtedness (other than Loans) secured by such asset or otherwise subject to mandatory prepayment as a result of such event, and (iii) the amount of all taxes paid (or reasonably estimated to be payable) by Holdings and the Subsidiaries, and the amount of any reserves established by Holdings and the Subsidiaries to fund contingent liabilities reasonably estimated to be payable, in each case during the year that such event occurred or the next succeeding year and that are directly attributable to such event or any transaction occurring or deemed to occur as a result of making a prepayment hereunder (as determined reasonably and in good faith by the chief financial officer of Holdings).

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

“New Total Return” has the meaning assigned to such term in Section 2.20(f).

“Non-consenting Lender” has the meaning assigned to such term in Section 2.19(b).

“Note” means a promissory note executed by the Borrower pursuant to Section 2.09(e).

“Obligations” means all Loan Obligations, the Swap Obligations and all Deposit Obligations.

“One Month Adjusted LIBO Rate” means for any calendar month, an interest rate per annum (rounded upwards, if necessary, to the next 1/16 of 1%) equal to (a) the LIBO Rate for an Interest Period of one month commencing on the first day of such calendar month multiplied by (b) the Statutory Reserve Rate; subject however, to the terms of Section 2.14.

“Other Taxes” means any and all present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies arising from any payment made under any Loan Document or from the execution, delivery or enforcement of, or otherwise with respect to, any Loan Document; excluding, however, such taxes that are imposed as a result of an assignment or designation of a new applicable lending office (other than assignment or new designation that occurs as a result of Borrower’s request pursuant to Section 2.19).

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“Participant” has the meaning set forth in Section 10.04(c).

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

“Permitted Encumbrances” means:

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

(b)           carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s and other like Liens imposed by law, arising in the ordinary course of business and securing obligations that (i) are not overdue by more than 30 days, (ii) are being contested in compliance with Section 5.04 or (iii) do not at any time exceed $500,000 in the aggregate for all such Liens and for Holdings and all the Subsidiaries;

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

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

(e)           judgment liens in respect of judgments that do not constitute an Event of Default under clause (k) of Section 8.01;

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

(g)           liens arising from filing UCC financing statements regarding leases permitted by this Agreement;

(h)           leasing or licensing of real or personal property (including subleases or sublicenses) permitted by Section 6.05;

(i)            with respect to each parcel of Mortgaged Property, encumbrances thereon reflected as exceptions to title in the mortgage title insurance policy (or binding commitment) relating to such parcel and approved by the Administrative Agent;

(j)            statutory and common law landlords’ liens under leases to which Holdings or one of the Subsidiaries is a party;

(k)           customary Liens (including the right of set-off) in favor of institutions at which deposit, commodity and security accounts are held encumbering such accounts and the assets held therein incurred in the ordinary course of business; and

(l)            liens incurred by Borrower or any subsidiary of Borrower with the consent of the Required Lenders.

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provided that the term “Permitted Encumbrances” shall not include any Lien securing Indebtedness.

“Permitted Investments” means:

(a)           securities issued or directly and fully guaranteed or insured by the United States of America or any agency, instrumentality or sponsored corporation thereof and backed by the full faith and credit of the United States of America, and in each case having maturities of not more than one year from the date of acquisition;

(b)           dollar denominated time deposits, certificates of deposit, overnight bank deposits and bankers’ acceptances with any Lender or any commercial bank of recognized standing, having capital and surplus in excess of $250,000,000 and the commercial paper of the holding company of which, at the time of acquisition thereof, is rated at least A-2 or the equivalent thereof by S&P or at least P-2 or the equivalent thereof by Moody’s (or if at such time neither is issuing ratings, then a comparable rating of another nationally recognized rating agency), or, if no such commercial paper rating is available, a long-term debt rating, at the time of acquisition thereof, of at least A or the equivalent thereof by S&P or at least A-2 or the equivalent thereof by Moody’s (or if at such time neither is issuing ratings, then a comparable rating of another nationally recognized rating agency);

(c)           repurchase obligations with a term of not more than 92 days for underlying securities of the types described in clause (a) above and entered into with any commercial bank meeting the qualifications specified in clause (b) above;

(d)           other investment instruments offered or sponsored by financial institutions having capital and surplus in excess of $250,000,000 and the commercial paper of the holding company of which, at the time of acquisition thereof, is rated at least A-1 or the equivalent thereof by S&P or at least P-1 or the equivalent thereof by Moody’s (or if at such time neither is issuing ratings, then a comparable rating of another nationally recognized rating agency), or, if no such commercial paper rating is available, a long-term debt rating, at the time of acquisition thereof, of at least A+ or the equivalent thereof by S&P or at least A-1 or the equivalent thereof by Moody’s (or if at such time neither is issuing ratings, then a comparable rating of another nationally recognized rating agency);

(e)           readily marketable direct obligations issued by any state of the United States of America or any political subdivision thereof having, at the time of acquisition thereof, one of the two highest rating categories obtainable from either Moody’s or S&P (or if at such time neither is issuing ratings, then a comparable rating of another nationally recognized rating agency)

(f)            commercial paper rated, at the time of acquisition thereof, at least A-1 or the equivalent thereof by S&P or at least P-1 or the equivalent thereof by Moody’s (or if at such time neither is issuing ratings, then a comparable rating of another nationally recognized rating agency), in each case maturing within one year after the date of acquisition;

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

(h)           in the case of any Foreign Subsidiary: (i) certificates of deposit (or comparable instruments) of any bank with which such Foreign Subsidiary regularly

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transacts business and with maturities of not more than six months from the date of acquisition by such Foreign Subsidiary, (ii) overnight deposits and demand deposit accounts maintained with any bank that such Foreign Subsidiary regularly transacts business and (iii) securities of the type and maturity described in clause (a) above but issued by the principal governmental authority in which such Foreign Subsidiary is organized so long as such security has the highest rating available from either S&P or Moody’s.

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

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

“Prepayment Event” means:

(a)           a Permitted Asset Disposition but only if as of the date of a Permitted Asset Disposition, the aggregate book value of all of the assets disposed of in Permitted Asset Dispositions during the period from the Effective Date to the date of determination (including the book value of the Permitted Asset Disposition in question) equal or exceed 5% of Holding’s Consolidated Assets as determined as of such date, with the term “Permitted Asset Disposition” meaning:

(i)            any sale, transfer or other disposition (including pursuant to a sale and leaseback transaction) of any asset of Holdings or any Subsidiary, other than dispositions described in paragraphs clauses (a), (b), (c) and (d) of Section 6.05; and

(ii)           any casualty or other insured damage to, or any taking under power of eminent domain or by condemnation or similar proceeding of, any asset of Holdings or any Subsidiary; or

(b)           the incurrence by Holdings or any Subsidiary of any Indebtedness, other than Indebtedness permitted by Section 6.01

“present fair saleable value” has the meaning assigned to such term in Section 3.15.

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

“Prior Lender Affiliate” has the meaning assigned to such term in Section 9.11.

“Purchase Price” has the meaning assigned to such term in Section 6.04(k)(ii).

“Register” has the meaning set forth in Section 10.04(b)(iv).

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

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“Remedial Action” means all costs and actions to (a) clean up, remove, remediate, contain, treat, monitor, investigate, or in any way address Hazardous Materials in the indoor or outdoor environment, (b) prevent or minimize a release or threatened release of Hazardous Materials so they do not migrate or endanger or threaten to endanger public health or welfare of the indoor or outdoor environment, (c) restore or reclaim natural resources or the environment, or (d) perform any pre-remedial, restoration or reclamation studies, investigations, or post-remedial, restoration or reclamation operation and maintenance activities.

“Required Lenders” means, at any time, Lenders having Revolving Exposures, Term Loans, Synthetic L/C Loans and unused Commitments representing more than 50% of the sum of the total Revolving Exposures, outstanding Term Loans, outstanding Synthetic L/C Loans and unused Commitments at such time.

“Required Percentage” has the meaning assigned to such term in Section 2.11(d)

“Restricted Indebtedness” means Indebtedness of Holdings or any Subsidiary, the payment, prepayment, redemption, repurchase or defeasance of which is restricted under Section 6.08(b).

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

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

“Revolving Commitment” means, with respect to each Lender, the commitment, if any, of such Lender to make Revolving Loans and to acquire participations in Letters of Credit and Swingline Loans hereunder, expressed as an amount representing the maximum aggregate amount of such Lender’s Revolving Exposure hereunder, as such commitment may be (a) reduced from time to time pursuant to Section 2.08, (b) increased from time to time pursuant to an Increased Commitment Supplement, and (c) reduced or increased from time to time pursuant to assignments by or to such Lender pursuant to Section 10.04.  The initial amount of each Lender’s Revolving Commitment is set forth on Schedule 2.01, or in the Assignment and Assumption pursuant to which such Lender shall have assumed its Revolving Commitment or in the Increased Commitment Supplement pursuant to which such Lender shall have become a Lender or increased its Revolving Commitment, as applicable.  The initial aggregate amount of the Lenders’ Revolving Commitments on the Effective Date is $90,000,000; provided that, in addition to the increases permitted by Section 2.20, the Borrower may, by written notice delivered to the Administrative Agent, increase the Revolving Commitments by an aggregate amount up to $10,000,000 (increasing the initial aggregate Revolving Commitments up to an aggregate amount not to exceed $100,000,000) by joining one or two additional financial institutions or other lenders approved by the Administrative Agent (which approval will not be unreasonably withheld or delayed) as Revolving Lenders hereunder, each with a Revolving Commitment in an amount not less than $5,000,000 (each such additional financial institution herein a “New Revolving Lender”).  Upon receipt of notice from the Borrower that one or more New Revolving Lenders have agreed to provide Revolving Commitments in an aggregate amount up to $10,000,000, then, provided that no Default exists at such time or after giving effect to the requested increase, Holdings, the Borrower, the Administrative Agent, and the New Revolving Lender or Lenders shall execute and deliver an Increased Commitment Supplement (herein so called) in the form attached hereto as Exhibit D.  As a result of the fact that all the existing Revolving Lenders shall not have provided their pro rata portion of the requested increase of the Revolving Commitments, then after giving effect to the increase, the outstanding Revolving Loans will not be held

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pro rata in accordance with the new Revolving Commitments.  In order to remedy the foregoing, on the effective date of the Increased Commitment Supplement delivered under this definition, the Revolving Lenders shall make advances among themselves (either directly or through the Administrative Agent) so that after giving effect thereto the Revolving Loans will be held by the Revolving Lenders pro rata in accordance with their respective Applicable Percentages.  Any advances made under the provisions of this definition by a Revolving Lender shall be deemed to be a purchase of a corresponding amount of the Revolving Loans of the Revolving Lender or Lenders who shall receive such advances.

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

“Revolving L/C Disbursements” means a payment made by the Issuing Bank pursuant to a Revolving Letter of Credit.

“Revolving L/C Exposure” means, at any time, the Dollar Equivalent amount of the sum of (a) the aggregate undrawn amount of all outstanding Revolving Letters of Credit at such time plus (b) the aggregate amount of all Revolving L/C Disbursements that have not yet been reimbursed by or on behalf of the Borrower at such time.  The Revolving L/C Exposure of any Revolving Lender at any time shall be its Applicable Percentage of the total Revolving L/C Exposure at such time.

“Revolving Lender” means a Lender with a Revolving Commitment or, if the Revolving Commitments have terminated or expired, a Lender with Revolving Exposure.

“Revolving Letters of Credit” means any letter of credit issued under Section 2.05 and determined to be a “Revolving Letter of Credit” under the terms of Section 2.05(b).

“Revolving Loan” means a loan made pursuant to clause (c) of Section 2.01.

“Revolving Maturity Date” means August 3, 2012.

“Rights Offering” means the offer made by Holdings to its existing Equity Interest holders to purchase additional shares of Holdings’ common stock for cash or in exchange for the cancellation of Take Back Notes as described in Holdings’ Offering Memorandum relating thereto.

“S&P” means Standard & Poor’s Rating Services, a division of the McGraw Hill Companies.

“Secured Parties” means the Administrative Agent, the Lenders, each Affiliate of a Lender who is owed any portion of the Obligations and Deutsche Bank AG as long as it is owed any Swap Obligations.

“Security Agreement” means the Security Agreement among the Borrower, Holdings, and the Subsidiary Loan Parties in substantially the form attached hereto as Exhibit E.

“Security Documents” means the Guaranty Agreement, the Security Agreement, the Mortgages and each other security agreement or other instrument or document executed and delivered pursuant to Section 5.12 or 5.13 to secure any of the Obligations.

“SK Holding” means SK Holding Company, Inc., a Delaware corporation.

“SK Preferred Stock” means SK Holding’s Series A preferred stock.

“Statutory Reserve Rate” means a fraction (expressed as a decimal), the numerator of which is the number one and the denominator of which is the number one minus the aggregate of the maximum

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

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

“Subsidiary” means any subsidiary of Holdings.

“Subsidiary Loan Party” means all the Subsidiaries other than The ArmaKleen Company, Elgint Corp, SK Europe, Inc. and the Excluded Foreign Subsidiaries.

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

“Swap Obligations” means (a) all obligations, indebtedness, and liabilities of Holdings and the Subsidiaries, or any one of them, to any Lender or any Affiliate of any Lender, arising pursuant to any Swap Agreements entered into by such Lender or Affiliate with Holdings or any Subsidiary, whether now existing or hereafter arising, whether direct, indirect, related, unrelated, fixed, contingent, liquidated, unliquidated, joint, several, or joint and several, including, without limitation, all fees, costs, and expenses (including attorneys’ fees and expenses) provided for in such Swap Agreements and (b) all obligations, indebtedness, and liabilities of Borrower to Deutsche Bank AG arising pursuant to the interest rate swap transactions governed by that certain Confirmation dated April 22, 2005 between Borrower and Deutsche Bank AG (as the same exist on the Effective Date, without giving effect to any amendment or other modification thereto for purposes of this definition unless amended with the consent of the Administrative Agent, which consent will not be unreasonably withheld or delayed), whether such obligations, indebtedness, and liabilities are now existing or hereafter arising, whether direct, indirect, related, unrelated, fixed, contingent, liquidated, unliquidated, joint, several, or joint and several, including, without limitation, all fees, costs, and expenses (including attorneys’ fees and expenses) provided for in such Confirmation and Master Agreement.

“Swingline Exposure” means, at any time, the aggregate principal amount of all Swingline Loans outstanding at such time.  The Swingline Exposure of any Lender at any time shall be its Applicable Percentage of the total Swingline Exposure at such time.

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“Swingline Lender” means JPMCB, in its capacity as the lender of Swingline Loans hereunder.

“Swingline Loan” means a loan made pursuant to Section 2.04.

“Synthetic Exposure” means, with respect to any Synthetic L/C Lender at any time, the sum of the outstanding principal amount of such Lender’s Synthetic L/C Loans and its Synthetic L/C Exposure at such time.  The Synthetic Exposure of any Synthetic Lender at any time shall be its Applicable Percentage of the total Synthetic Exposure at such time.

“Synthetic L/C Loans” means a loan made pursuant to clause (a) of Section 2.01.

“Synthetic L/C Commitment” means, with respect to each Lender, the commitment, if any, of such Lender to make Synthetic L/C Loans hereunder, expressed as an amount representing the maximum principal amount of the Synthetic L/C Loans to be made by such Lender hereunder, as such commitment may be (a) reduced from time to time pursuant to Section 2.08, (b) increased or established from time to time pursuant to an Increased Commitment Supplement, and (c) reduced or increased from time to time pursuant to assignments by or to such Lender pursuant to Section 10.04.  The initial amount of each Lender’s Synthetic L/C Commitment is set forth on Schedule 2.01, or in the Assignment and Assumption pursuant to which such Lender shall have assumed its Synthetic L/C Commitment or in the Increased Commitment Supplement pursuant to which such Lender became a Synthetic L/C Lender, as applicable.  The initial aggregate amount of the Lenders’ Synthetic L/C Commitments on the Effective Date is $65,000,000.

“Synthetic L/C Disbursements” means a payment made by the Issuing Bank pursuant to a Synthetic Letter of Credit.

“Synthetic L/C Exposure” means, at any time, the Dollar Equivalent amount of the sum of (a) the aggregate undrawn amount of all outstanding Synthetic Letters of Credit at such time plus (b) the aggregate amount of all Synthetic L/C Disbursements that have not yet been reimbursed by or on behalf of the Borrower at such time.  The Synthetic L/C Exposure of any Synthetic L/C Lender at any time shall be its Applicable Percentage of the total Synthetic L/C Exposure at such time.

“Synthetic L/C Lender” means a Lender with a Synthetic L/C Commitment or, if the Synthetic L/C Commitments have terminated or expired, a Lender with Synthetic Exposure.

“Synthetic Letters of Credit” means any letter of credit issued under Section 2.05 and determined to be a “Synthetic Letter of Credit” under the terms of Section 2.05(b).

“Take Back Notes” means the notes issued by Borrower and Safety-Kleen Oil Recovery Company pursuant to that certain Term Note Agreement dated as of December 24, 2003 among Holdings, SK Holding, certain other Subsidiaries and BNY Asset Solutions LLC as agent.

“Target” means a Person who is to be acquired or whose assets are to be acquired in a transaction permitted by Section 6.04.

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

“Term B Commitment” means, with respect to each Lender, the commitment, if any, of such Lender to make a Term B Loan hereunder on the Effective Date, expressed as an amount representing the maximum principal amount of the Term B Loan to be made by such Lender hereunder, as such commitment may be (a) reduced from time to time pursuant to Section 2.08, (b) increased or established

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from time to time pursuant to an Increased Commitment Supplement, and (c) reduced or increased from time to time pursuant to assignments by or to such Lender pursuant to Section 10.04.  The initial amount of each Lender’s Term B Commitment is set forth on Schedule 2.01, or in the Assignment and Assumption pursuant to which such Lender shall have assumed its Term B Commitment or in the Increased Commitment Supplement pursuant to which such Lender became a Lender, as applicable.  The initial aggregate amount of the Lenders’ Term B Commitments on the Effective Date is $230,000,000.

“Term B Lender” means a Lender with a Term B Commitment or an outstanding Term B Loan.

“Term B Loan” means a loan made pursuant to clause (b) of Section 2.01.

“Term Loan Maturity Date” means August 2, 2013.

“Term Loans” means Term B Loans and the Incremental Term Loans.

“Total Return” has the meaning assigned to such term in Section 2.20(f).

“Transactions” means the consummation of the Rights Offering on the Effective Date, the repayment in full of the Take Back Notes and the Existing Credit Facility on the Effective Date, the redemption in full of all SK Preferred Stock and the execution, delivery and performance by each Loan Party of the Loan Documents to which it is to be a party, the borrowing of Loans, the use of the proceeds thereof and the issuance of Letters of Credit hereunder.

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

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

“Wholly-Owned Subsidiary” shall mean, as to any Person, (i) any corporation 100% of whose capital stock (other than director’s qualifying shares and/or other nominal amounts of shares required by applicable law to be held by Persons other than such Person) is at the time owned by such Person and/or one or more Wholly-Owned Subsidiaries of such Person and (ii) any partnership, association, joint venture or other entity in which such Person and/or one or more Wholly-Owned Subsidiaries of such Person has a 100% Equity Interest at such time.

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

Section 1.03.                             Terms Generally.  The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined.  Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms.  The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”.  The word “will” shall be construed to have the same meaning and effect as the word “shall”.  Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or

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modifications set forth herein), (b) any reference herein to any Person shall be construed to include such Person’s successors and assigns, (c) the words “herein”, “hereof” and “hereunder”, and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (d) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement and (e) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.

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

ARTICLE II.

The Credits

Section 2.01.                             Commitments.  Subject to the terms and conditions set forth herein, each Lender agrees:

(a)                                  Synthetic L/C Loans.  To make loans to the Borrower at any time and from time to time during the period commencing on the date hereof and ending on the Term Loan Maturity Date in an aggregate principal amount that will not result in such Lender’s Synthetic Exposure exceeding such Lender’s Synthetic L/C Commitment; provided that each Synthetic L/C Loan of a Lender shall be funded solely from amounts on deposit in its Credit Linked Account as provided in Section 2.05(e)(i)(C)(1);

(b)                                 Term B Loans.  To make a loan to the Borrower on the Effective Date in a principal amount not exceeding its Term B Commitment; and

(c)                                  Revolving Loans.  To make loans to the Borrower from time to time during the Revolving Availability Period in an aggregate principal amount that will not result in such Lender’s Revolving Exposure exceeding such Lender’s Revolving Commitment.

Within the foregoing limits and subject to the terms and conditions set forth herein, the Borrower may borrow, prepay and reborrow Revolving Loans and Synthetic L/C Loans.  Amounts repaid in respect of Term Loans may not be reborrowed.

Section 2.02.                             Loans and Borrowings.

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

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(b)                                 Initial Type of Loans.  Subject to Section 2.14, each Revolving Borrowing and Term Borrowing shall be comprised entirely of ABR Loans or Eurodollar Loans or any combination thereof as the Borrower may request in accordance herewith or, with respect to Incremental Term borrowings, in accordance with the terms of the applicable Increased Commitment Supplement; provided that all Borrowings made on the Effective Date must be made as ABR Borrowings and an Increased Commitment Supplement may provide that the Incremental Term Borrowings governed thereby will accrue interest on the basis set forth therein.  Each Swingline Loan shall be an ABR Loan and each Synthetic L/C Loan shall bear interest as provided in Section 2.13(c).  Each Lender at its option may make any Eurodollar Loan or Synthetic L/C Loan by causing any domestic or foreign branch or Affiliate of such Lender to make such Loan; provided that any exercise of such option shall not affect the obligation of the Borrower to repay such Loan in accordance with the terms of this Agreement.

(c)                                  Minimum Amounts; Limitation on Eurodollar Borrowings.  At the commencement of each Interest Period for any Eurodollar Borrowing, such Borrowing shall be in an aggregate amount that is an integral multiple of $100,000 and not less than $1,000,000.  At the time that each ABR Revolving Borrowing is made, such Borrowing shall be in an aggregate amount that is an integral multiple of $100,000 and not less than $1,000,000; provided that an ABR Revolving Borrowing may be in an aggregate amount that is equal to the entire unused balance of the total Revolving Commitments or that is required to finance the reimbursement of a Revolving L/C Disbursement as contemplated by Section 2.05(f)(ii).  Each Synthetic L/C Borrowing will be in an aggregate amount that is required to finance the reimbursement of a Synthetic L/C Disbursement as contemplated by Section 2.05(f)(i).  Each Swingline Loan shall be in an amount that is an integral multiple of $50,000 and not less than $100,000 or in an amount that is required to finance the reimbursement of a Revolving L/C Disbursement as contemplated by Section 2.05(f)(ii).  Borrowings of more than one Type and Class may be outstanding at the same time; provided that there shall not at any time be more than a total of ten Eurodollar Borrowings outstanding.

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

Section 2.03.                             Requests for Borrowings.  To request a Revolving Borrowing or Term B Borrowing, the Borrower shall notify the Administrative Agent of such request by telephone (a) in the case of a Eurodollar Borrowing, not later than noon, Houston, Texas time, three Business Days before the date of the proposed Borrowing or (b) in the case of an ABR Borrowing, not later than noon, Houston, Texas time, one Business Day before the date of the proposed Borrowing; provided that the Borrower is not required to give notice of an automatic ABR Revolving Borrowing that is used to finance the reimbursement of a Revolving L/C Disbursement under the terms of Section 2.05(f)(ii).  Each such telephonic Borrowing Request shall be irrevocable and shall be confirmed promptly by delivery to the Administrative Agent of a written Borrowing Request in a form attached hereto as Exhibit  F and signed by the Borrower which may be delivered by hand, by telecopy or by electronic communication pursuant to procedures approved by the Administrative Agent.  Each such telephonic and written Borrowing Request shall specify the following information in compliance with Section 2.02:

(i)                                     the aggregate amount of such Borrowing;

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

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

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

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

If no election as to the Type of Borrowing is specified, then the requested Borrowing shall be an ABR Borrowing.  If no Interest Period is specified with respect to any requested Eurodollar Borrowing, then the Borrower shall be deemed to have selected an Interest Period of one month’s duration.  Promptly following receipt of a Borrowing Request in accordance with this Section and promptly after a Revolving L/C Disbursement is made which is to be financed with an automatic ABR Revolving Borrowing under Section 2.05(f)(ii), the Administrative Agent shall advise each Lender of the details of the applicable Borrowing and of the amount of such Lender’s Loan to be made as part of the applicable Borrowing.  Synthetic L/C Loans shall be made pursuant to the provisions of Section 2.05(e)(i)(C)(1).  Incremental Term Loans shall be made pursuant to the terms of the applicable Increased Commitment Supplement.

Section 2.04.                             Swingline Loans.

(a)                                  Commitment.  Subject to the terms and conditions set forth herein, the Swingline Lender agrees to make loans to the Borrower from time to time during the Revolving Availability Period, in an aggregate principal amount at any time outstanding that will not result in (i) the aggregate principal amount of outstanding Swingline Loans exceeding $15,000,000 or (ii) the sum of the total Revolving Exposures exceeding the total Revolving Commitments; provided that the Swingline Lender shall not be required to make a Swingline Loan to refinance an outstanding Swingline Loan.  Within the foregoing limits and subject to the terms and conditions set forth herein, the Borrower may borrow, prepay and reborrow Swingline Loans.

(b)                                 Borrowing Procedure.  To request a Swingline Loan, the Borrower shall notify the Administrative Agent of such request by telephone (confirmed by telecopy), not later than noon, Houston, Texas time, on the day of a proposed Swingline Loan.  Each such notice shall be irrevocable and shall specify the requested date (which shall be a Business Day) and amount of the requested Swingline Loan.  The Administrative Agent will promptly advise the Swingline Lender of any such notice received from the Borrower.  Swingline Loans may be made automatically under the provisions of Section 2.05(f)(ii) to finance a Revolving L/C Disbursement as provided therein.  The Swingline Lender shall make each Swingline Loan available to the Borrower by means of a credit to the general deposit account of the Borrower with the Swingline Lender or by wire transfer, automated clearing house debit or interbank transfer to such other account, accounts or Person designated by the Borrower (or, in the case of a Swingline Loan made to finance the reimbursement of a Revolving L/C Disbursement as provided in Section 2.05(f)(ii), by remittance to the Issuing Bank) by 3:00 p.m., Houston, Texas time, on the requested date of such Swingline Loan.

(c)                                  Revolving Lender Participation in Swingline Loans.  The Swingline Lender may by written notice given to the Administrative Agent not later than 10:00 a.m., Houston, Texas time, on any Business Day require the Revolving Lenders to acquire participations on such Business Day in all or a portion of the Swingline Loans outstanding.  Such notice shall specify the aggregate amount of Swingline Loans in which Revolving Lenders will participate.  Promptly upon receipt of such notice, the Administrative Agent will give notice thereof to each Revolving Lender, specifying in such notice such Lender’s Applicable Percentage of such Swingline Loan or Loans.  Each Revolving Lender hereby absolutely and unconditionally agrees, upon receipt of notice as provided above, to pay to the Administrative Agent, for the account of the Swingline Lender, such Lender’s Applicable Percentage of

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such Swingline Loan or Loans.  Each Revolving Lender acknowledges and agrees that its obligation to acquire participations in Swingline Loans pursuant to this paragraph is absolute and unconditional and shall not be affected by any circumstance whatsoever, including the occurrence and continuance of a Default or reduction or termination of the Commitments, and that each such payment shall be made without any offset, abatement, withholding or reduction whatsoever.  Each Revolving Lender shall comply with its obligation under this paragraph by wire transfer of immediately available funds, in the same manner as provided in Section 2.06 with respect to Loans made by such Lender (and Section 2.06 shall apply, mutatis mutandis, to the payment obligations of the Revolving Lenders), and the Administrative Agent shall promptly pay to the Swingline Lender the amounts so received by it from the Revolving Lenders.  The Administrative Agent shall notify the Borrower of any participations in any Swingline Loan acquired pursuant to this paragraph, and thereafter payments in respect of such Swingline Loan shall be made to the Administrative Agent and not to the Swingline Lender.  Any amounts received by the Swingline Lender from the Borrower (or other party on behalf of the Borrower) in respect of a Swingline Loan after receipt by the Swingline Lender of the proceeds of a sale of participations therein shall be promptly remitted to the Administrative Agent; any such amounts received by the Administrative Agent shall be promptly remitted by the Administrative Agent to the Revolving Lenders that shall have made their payments pursuant to this paragraph and to the Swingline Lender, as their interests may appear; provided that any such payment so remitted shall be repaid to the Swingline Lender or to the Administrative Agent, as applicable, if and to the extent such payment is required to be refunded to the Borrower for any reason.  The purchase of participations in a Swingline Loan pursuant to this paragraph shall not relieve the Borrower of any default in the payment thereof.

Section 2.05.                             Letters of Credit.

(a)                                  General.  Subject to the terms and conditions set forth herein, the Issuing Bank agrees to issue letters of credit for the account of the Borrower for use by Holdings or one or more of the Subsidiaries, payable in dollars, Canadian dollars or in such other currency that is acceptable to the Issuing Bank at any time and from time to time until the Term Loan Maturity Date; provided that:  (i) each such letter of credit is in a form reasonably acceptable to the Administrative Agent and the Issuing Bank; (ii) the Revolving L/C Exposure shall not exceed $30,000,000; (iii) the total Revolving Exposures shall not exceed the total Revolving Commitments; (iv) the Synthetic Exposure shall not exceed the total Synthetic L/C Commitments; and (v) no Revolving Letter of Credit may be issued hereunder after the Revolving Maturity Date.

(b)                                 Determination of the Type of Letter of Credit.  Letters of Credit issued under the terms of Section 2.05(a) shall be Synthetic Letters of Credit unless after giving effect thereto the Synthetic Exposure would exceed the total Synthetic L/C Commitments.  Letters of Credit issued under the terms of Section 2.05(a) shall be Revolving Letters of Credit only to the extent, and in an amount by which, the aggregate amount of the Synthetic Exposure exceeds the total Synthetic L/C Commitments.  Drawings under any Letter of Credit shall be deemed to have been made first under Synthetic Letters of Credit for so long as, and to the extent that, there are any undrawn Synthetic Letters of Credit outstanding and thereafter shall be deemed to have been made under Revolving Letters of Credit.  Any Letter of Credit that expires or terminates will be deemed to be first a Revolving Letter of Credit, for so long as, and to the extent that, there are outstanding Revolving Letters of Credit immediately prior to such expiration or termination.  To the extent necessary to implement the foregoing, the identification of a Letter of Credit as a Revolving Letter of Credit or a Synthetic Letter of Credit may change from time to time and a portion of a Letter of Credit may be deemed to be a Synthetic Letter of Credit and the remainder be deemed to be a Revolving Letter of Credit.  Notwithstanding the foregoing, the entire face amount of any Letter of Credit with an expiration date after the Revolving Maturity Date shall at all times be deemed to be a Synthetic Letter of Credit.

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(c)                                  Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions.  To request the issuance of a Letter of Credit (or the amendment, renewal or extension of an outstanding Letter of Credit), the Borrower shall hand deliver, telecopy or transmit by electronic communication (if arrangements for doing so have been approved by the Issuing Bank) to the Issuing Bank and the Administrative Agent (reasonably in advance of the requested date of issuance, amendment, renewal or extension) a notice requesting the issuance of a Letter of Credit, or identifying the Letter of Credit to be amended, renewed or extended, and specifying the date of issuance, amendment, renewal or extension (which shall be a Business Day), the date on which such Letter of Credit is to expire (which shall comply with paragraph (d) of this Section), the amount of such Letter of Credit, the currency in which such Letter of Credit is payable, name and address of the beneficiary thereof and such other information as shall be necessary to prepare, amend, renew or extend such Letter of Credit.  If requested by the Issuing Bank, the Borrower also shall submit a letter of credit application on the Issuing Bank’s standard form in connection with any request for a Letter of Credit.  In the event of any inconsistency between the terms and conditions of this Agreement and the terms and conditions of any form of letter of credit application or other agreement submitted by the Borrower to, or entered into by the Borrower with, the Issuing Bank relating to any Letter of Credit, the terms and conditions of this Agreement shall control.

(d)                                 Expiration Date.  Each Letter of Credit shall expire at or prior to the close of business on the earlier of (i) the date one year after the date of the issuance of such Letter of Credit (or, in the case of any renewal or extension thereof, one year after such renewal or extension) (provided that any Letter of Credit with a one-year term may provide for the renewal thereof for additional one-year periods not to extend past the date in clause (ii) below) and (ii) with respect to Revolving Letters of Credit, the date that is five Business Days prior to the Revolving Maturity Date and with respect to Synthetic Letters of Credit, the date that is five Business Days prior to the Term Loan Maturity Date.

(e)                                  Participations.

(i)                                     Synthetic Letters of Credit.  By the issuance of a Synthetic Letter of Credit (or an amendment to a Synthetic Letter of Credit increasing the amount thereof) and without any further action on the part of the Issuing Bank or the Lenders, the Issuing Bank hereby grants to each Synthetic L/C Lender, and each Synthetic L/C Lender hereby acquires from the Issuing Bank, a participation in such Synthetic Letter of Credit equal to such Lender’s Applicable Percentage of the aggregate Dollar Equivalent amount available to be drawn under such Synthetic Letter of Credit.  In consideration and in furtherance of the foregoing, each Synthetic L/C Lender hereby absolutely and unconditionally agrees to pay to the Administrative Agent in dollars, for the account of the Issuing Bank, such Lender’s Applicable Percentage of the Dollar Equivalent amount of each Synthetic L/C Disbursement made by the Issuing Bank and not reimbursed by the Borrower on the date due as provided in paragraph (f)(i) of this Section, or of any reimbursement payment required to be refunded to the Borrower for any reason; provided that each such payment obligations of a Synthetic Lender shall be funded solely from amounts on deposit in its Credit Linked Account as provided in subparagraph (e)(i)(C)(1) of this Section.  Each Synthetic L/C Lender acknowledges and agrees that its obligation to acquire participations pursuant to this paragraph in respect of Synthetic Letters of Credit is absolute and unconditional and shall not be affected by any circumstance whatsoever, including any amendment, renewal or extension of any Synthetic Letter of Credit or the occurrence and continuance of a Default or reduction or termination of the Synthetic L/C Commitments, and that each such payment shall be made without any offset, abatement, withholding or reduction whatsoever.

(A)                              Establishment of Credit Linked Accounts; Grant of Security Interest therein.  On or prior to the Effective Date, the Administrative Agent shall establish an account at JPMCB in the name of each Synthetic L/C Lender.  The Administrative Agent shall establish additional Credit Linked Accounts at JPMCB at such times and in the names of the applicable Synthetic L/C Lender

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as shall be required pursuant to Section 2.20 or Section 10.04.  Amounts on deposit in each Credit Linked Account shall be invested, or caused to be invested, by the Administrative Agent as set forth in subparagraph (e)(i)(D) below, and no Person (other than the Administrative Agent or any of its sub-agents) shall have the right to make any withdrawals from any Credit Linked Account or exercise any other right or power with respect thereto, except as expressly provided in subparagraph (e)(i)(C) below.  Without limiting the generality of the foregoing, each party hereto acknowledges and agrees that no amount on deposit at any time in any Credit Linked Account shall be the property of any Loan Party, shall constitute “Collateral” under the Loan Documents, or shall otherwise be available in any manner to satisfy any Obligation of any Loan Party under the Loan Documents.  However, the Credit Linked Account of a Synthetic L/C Lender and all moneys and other investment property held therein is provided to secure the funding obligation of such Synthetic L/C Lender to the Issuing Bank under Section 2.05(e)(i) and in furtherance of the foregoing, each Synthetic L/C Lender hereby grants to the Administrative Agent a security interest in its Credit Linked Account and all moneys and investment property held therein or pursuant thereto to secure its obligations under Section 2.05(e)(i).  Such security interests are perfected by control.  Each Synthetic L/C Lender represents and warrants to the Issuing Lender and the Administrative Agent that its Credit Linked Account and all moneys and investment property held therein or pursuant thereto are not subject to any Lien.  Each Synthetic L/C Lender agrees that it will not grant any Lien in its Credit Linked Account nor in any moneys and investment property held therein or pursuant thereto except as provided in this Section and it will not transfer or assign any of its right, title and interest in or to such property except in accordance with the terms of Section 10.04.

(B)                                Deposits into Credit Linked Accounts.  The following amounts will be deposited in each Credit Linked Account at the following times:

(1)                                  On the Effective Date.  On the Effective Date, each Synthetic L/C Lender shall deposit in its Credit Linked Account an amount in dollars equal to such Synthetic L/C Lender’s Synthetic L/C Commitment.  All funding obligations of a Synthetic L/C Lender with respect to any Synthetic L/C Loans and all obligations of a Synthetic L/C Lender to repay the Issuing Bank with respect to any Synthetic L/C Disbursement not reimbursed by the Borrower, shall be satisfied upon such Synthetic L/C Lender’s making such deposit in its Credit Linked Account;

(2)                                  Synthetic Loan Payments.  On any date on which the Administrative Agent receives any payment for the account of any Synthetic L/C Lender with respect to the principal amount of any of its Synthetic L/C Loans prior to the date that the Credit Linked Accounts are closed under subparagraph (e)(i)(C)(6) of this Section, the Administrative Agent shall deposit such amount in the Credit Linked Account of such Synthetic L/C Lender;

(3)                                  Synthetic Letter of Credit Reimbursement Payments.  On any date on which the Administrative Agent or the Issuing Bank receives any reimbursement payment from the Borrower with respect to amounts withdrawn from any Credit Linked Account to reimburse the Issuing Bank with respect to any payment made by it under any Synthetic Letter of Credit prior to the date that the Credit Linked Accounts are closed under subparagraph (e)(i)(C)(6) of this Section, the Administrative Agent or the Issuing Bank shall deposit in each Credit Linked Account the portion of such reimbursement payment to be deposited therein, in accordance with Section 2.05(f);

(4)                                  Assignments of Synthetic L/C Commitment.  Concurrently with the effectiveness of any assignment by any Synthetic L/C Lender of all or any portion of its Synthetic L/C Commitment, the Administrative Agent shall transfer

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into the Credit Linked Account of the assignee Synthetic L/C Lender the corresponding portion of the amount on deposit in the assignor’s Credit Linked Account in accordance with Section 10.4;

(5)                                  On the Effective Date of an Increased Commitment Supplement.  On the effective date of an Increased Commitment Supplement that increases a Synthetic L/C Commitment of a Lender, each Lender that shall then be increasing its Synthetic L/C Commitment or providing a new Synthetic L/C Commitment shall deposit in its Credit Linked Account an amount in dollars equal to the amount by which such Synthetic L/C Lender’s Synthetic L/C Commitment has increased or been established.  All funding obligations of a Synthetic L/C Lender arising under such increase or new Synthetic L/C Commitment with respect to any Synthetic L/C Loan and all obligations of a Synthetic L/C Lender arising under such increase or new Synthetic L/C Commitment to repay the Issuing Bank with respect to any draw paid by it under any Synthetic Letter of Credit and not reimbursed by the Borrower, shall be satisfied upon such Synthetic L/C Lender’s making such deposit in its Credit Linked Account; and

(6)                                  Deposit of Investment Return.  The return earned under Section 2.05(e)(i)(D) for the first two months of each calendar quarter by a Synthetic L/C Lender shall be deposited by the Administrative Agent in the Credit Linked Account of the applicable Synthetic L/C Lender as provided for in such Section.

(C)                                Withdrawals from and Closing of Credit Linked Accounts.  Amounts on deposit in each Credit Linked Account shall be withdrawn and distributed (or transferred, in the case of clause (3) below) as follows:

(1)                                  Funding of Synthetic L/C Disbursements; Creation of Synthetic L/C Loans.  On any date on which the Issuing Bank is to be reimbursed by the Synthetic L/C Lenders for any payment made by the Issuing Bank with respect to a Synthetic L/C Letter of Credit under Section 2.05(f)(i), the Administrative Agent shall withdraw from each Credit Linked Account an amount equal to the relevant Synthetic L/C Lender’s Applicable Percentage of the Dollar Equivalent amount of such unreimbursed payment, and make such amount available to the Issuing Bank in accordance with Section 2.05(f), and the amount so withdrawn shall be deemed to be a Synthetic L/C Loan made on such date;

(2)                                  Reduction of the Synthetic L/C Commitments.  Concurrently with each optional or mandatory reduction or termination of the total Synthetic L/C Commitments pursuant to Section 2.08 or Section 2.11(e)(ii), the Administrative Agent shall withdraw from each Credit Linked Account, and pay to the relevant Synthetic L/C Lender, an amount equal to such Synthetic L/C Lender’s Applicable Percentage of the amount of the optional or mandatory reduction of the total Synthetic L/C Commitments;

(3)                                  Assignment of a Synthetic L/C Commitment.  Concurrently with the effectiveness of any assignment by any Synthetic L/C Lender of all or any portion of its Synthetic L/C Commitment, the corresponding portion of the amount on deposit in the assignor’s Credit Linked Account shall be transferred from the assignor’s Credit Linked Account to the assignee’s Credit Linked Account in accordance with

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Section 10.04 and, if required by Section 10.04, the Administrative Agent shall close such assignor’s Credit Linked Account;

(4)                                  Settlement Date.  Promptly following the earlier to occur of the Term Loan Maturity Date or the date of the acceleration of the Loan Obligations in accordance with Section 8.01, the Administrative Agent shall withdraw from each Credit Linked Account and pay to such Synthetic L/C Lender an amount equal to the applicable Synthetic L/C Lender’s Applicable Percentage of the amount by which aggregate amounts then on deposit in the Credit Linked Accounts exceed the sum of the Synthetic L/C Exposure that is denominated in dollars plus 102% of the Synthetic L/C Exposure which is denominated in currencies other than dollars;

(5)                                  Withdrawal of Investment Return.  The return deposited in the Credit Linked Account of a Synthetic L/C Lender monthly under Section 2.05(e)(i)(D), shall be withdrawn quarterly and paid to the applicable Synthetic L/C Lender as provide for in Section 2.05(e)(i)(D); and

(6)                                  Final Distribution.  Upon the reduction of the total Synthetic L/C Commitments to $0 and the expiration or cancellation of all outstanding Synthetic Letters of Credit, the Administrative Agent shall withdraw from each Credit Linked Account, and pay to the relevant Synthetic L/C Lender, the aggregate amount then on deposit therein, and shall close each such Credit Linked Account.

(D)                               Payment of Investment Return.  The Administrative Agent shall pay to each Synthetic L/C Lender a rate per annum on the amount on deposit in the Credit Linked Account of such Synthetic L/C Lender equal to:

(i)                                     either:

(x)                                   the one month London interbank offered rate as determined by the Administrative Agent on such day (or if such day was not a Business Day, the first Business Day immediately preceding such day) based on rates for deposits in dollars as set forth on the Bloomberg L.P. page BTMM (or on any successor or substitute page of Bloomberg L.P. or any successor to or substitute for Bloomberg L.P. providing rate quotations comparable to those currently provided on such page, as determined by the Administrative Agent from time to time for purposes of providing quotations of interest rates applicable to dollar deposits in the London interbank market) or

(y)                                 if the circumstances giving rise to the notice delivered under Section 2.14 are in effect with respect to the one month LIBO Rate, the rate determined pursuant to Section 2.14 (the rate determined pursuant to this clause (i), herein the “Benchmark LIBOR Rate”) minus

(ii)                                  0.15% (based on a 365 or 366 day year, as the case may be).

The Benchmark LIBOR Rate will be reset on each Business Day.  Such return accrued during any of the first two months of any calendar quarter will be deposited in each Synthetic L/C Lender’s Credit Linked Account by the Administrative Agent on the first Business Day of the following calendar month.  With respect to each calendar quarter, the amount of such return as calculated for the first two months of such calendar quarter which is on deposit in the Credit Linked Account of each Synthetic L/C Lender shall be

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withdrawn therefrom and paid to each applicable Synthetic L/C Lender and the amount of such return accrued for the last month of such calendar quarter shall be paid to the applicable Synthetic L/C Lender in arrears, in each case, on the third Business Day following the last day of each calendar quarter.  The amount of all returns accrued and unpaid under this Section shall also be payable by the Administrative Agent to each Synthetic L/C Lender entitled thereto on the Term Loan Maturity Date and the date that the Credit Linked Accounts are closed under subparagraphs (e)(i)(C)(3) and (6) of this Section.  No Loan Party shall have any obligation under or in respect of the provisions of this Section 2.05(e)(i)(D) and without limiting the generality of the foregoing, the Borrower shall not be liable for any losses due to or misappropriation of any (i) return due to the Administrative Agent’s failure to achieve the return thereon pursuant to this Section or to pay all or any portion of such return to any Synthetic L/C Lender or (ii) amount on deposit in any Credit Linked Account (it being understood and agreed for greater certainty that this provision shall not limit any obligation of the Borrower hereunder to repay any Synthetic L/C Loan).  The Administrative Agent may perform any and all its duties and exercise its rights and powers contemplated by this Section 2.05(e) by or through one or more sub-agents appointed by it (which may include any of its Affiliates), and any such sub-agent shall be entitled to the benefit of all the provisions of Article IX of this Agreement.  The parties hereto acknowledge that on or prior to the Effective Date, the Administrative Agent has engaged JPMorgan Chase Institutional Services to act as its sub-agent for purposes of this Section 2.05(e), and that in such capacity JPMorgan Chase Institutional Services shall be entitled to the benefit of all the provisions of Article IX of this Agreement.

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

(f)                                    Reimbursement.  If the Issuing Bank shall make any L/C Disbursement in respect of a Letter of Credit, the Issuing Bank shall give the Borrower notice thereof and the Borrower shall reimburse such L/C Disbursement by paying to the Administrative Agent in dollars an amount equal to the Dollar Equivalent amount of such L/C Disbursement not later than 12:00 noon, Houston, Texas time, on the date that such L/C Disbursement is made, if the Borrower shall have received notice of such L/C Disbursement prior to 10:00 a.m., Houston, Texas time, on such date, or, if such notice has not been received by the Borrower prior to such time on such date, then not later than 12:00 noon, Houston, Texas time, on (i) the Business Day that the Borrower receives such notice, if such notice is received prior to 10:00 a.m., Houston, Texas time, on the day of receipt, or (ii) the Business Day immediately following the day that the Borrower receives such notice, if such notice is not received prior to such time on the day of receipt; provided that:

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(i)                                     Synthetic L/C Disbursement.  if such L/C Disbursement is a Synthetic L/C Disbursement and the Borrower has not reimbursed such L/C Disbursement by the applicable date and time as determined above, such payment shall be financed with an Synthetic L/C Borrowing in an equivalent amount pursuant to Section 2.05(e)(i)(C)(1) and, to the extent so financed, the Borrower’s obligation to make such payment shall be discharged and replaced by the resulting Synthetic L/C Loan; and

(ii)                                  Revolving L/C Disbursement.  if such L/C Disbursement is a Revolving L/C Disbursement then, provided that no Default then exists and subject to compliance with the conditions to borrowing set forth herein, such payment shall, without the need for a request from the Borrower, be financed with a Swingline Loan in an equivalent amount or, if there is not sufficient availability under Section 2.04(a)(i) to make such Swingline Loan, financed with an ABR Revolving Borrowing in an equivalent amount without the need for a request from the Borrower.  To the extent so financed, the Borrower’s obligation to make such payment shall be discharged and replaced by the resulting ABR Revolving Borrowing or Swingline Loan.

If the Borrower fails to make a payment to reimburse a Revolving L/C Disbursement when due and such amount is not automatically financed pursuant to the foregoing clause (ii), the Administrative Agent shall notify each Revolving Lender of the applicable Revolving L/C Disbursement, the payment then due from the Borrower in respect thereof and such Lender’s Applicable Percentage of the Dollar Equivalent amount thereof.  Promptly following receipt of such notice, each Revolving Lender shall pay to the Administrative Agent its Applicable Percentage of the payment then due from the Borrower, in the same manner as provided in Section 2.06 with respect to Loans made by such Lender (and Section 2.06 shall apply, mutatis mutandis, to the payment obligations of the Revolving Lenders), and the Administrative Agent shall promptly pay to the Issuing Bank the amounts so received by it from the Revolving Lenders. Any payment made by a Revolving Lender pursuant to this paragraph to reimburse the Issuing Bank for any Revolving L/C Disbursement (other than the funding of ABR Revolving Loans or a Swingline Loan as contemplated above) shall not constitute a Loan and shall not relieve the Borrower of its obligation to reimburse such Revolving L/C Disbursement.  Promptly following receipt by the Administrative Agent of any payment from the Borrower pursuant to this paragraph, the Administrative Agent shall distribute such payment to the Issuing Bank or, to the extent that Lenders have made payments pursuant to this paragraph to reimburse the Issuing Bank, then to such Lenders and the Issuing Bank as their interests may appear and if to any Synthetic L/C Lender, to such Lender’s Credit Linked Account in accordance with Section 2.05(e)(i)(B)(3).  A reimbursement or participation obligations with respect to a Letter of Credit issued in a currency other than dollars shall be discharged by the payment in dollars of the Dollar Equivalent amount thereof only to the extent that following receipt by the Issuing Bank of the payment in dollars, the Issuing Bank may in accordance with normal banking procedures purchase the applicable amount of the other currency with the dollars so received.  The Borrower, as a separate obligation, agrees to indemnify the Issuing Bank against, and to pay the Issuing Bank on demand in dollars, the amount (if any) by which the sum originally due to the Issuing Bank in a currency other than dollars exceeds the amount of such currency so purchased.

(g)                                 Obligations Absolute.  The Borrower’s obligation to reimburse L/C Disbursements as provided in paragraph (f) of this Section shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement under any and all circumstances whatsoever and irrespective of (i) any lack of validity or enforceability of any Letter of Credit or this Agreement, or any term or provision therein, (ii) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent or invalid in any respect or any statement therein being untrue or inaccurate in any respect, (iii) payment by the Issuing Bank under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit, or (iv) any other event or circumstance whatsoever, whether or not similar to any of the foregoing,

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that might, but for the provisions of this Section, constitute a legal or equitable discharge of, or provide a right of setoff against, the Borrower’s obligations hereunder.  Neither the Administrative Agent, the Lenders nor the Issuing Bank, nor any of their Related Parties, shall have any liability or responsibility by reason of or in connection with the issuance or transfer of any Letter of Credit or any payment or failure to make any payment thereunder (irrespective of any of the circumstances referred to in the preceding sentence), or any error, omission, interruption, loss or delay in transmission or delivery of any draft, notice or other communication under or relating to any Letter of Credit (including any document required to make a drawing thereunder), any error in interpretation of technical terms or any consequence arising from causes beyond the control of the Issuing Bank; provided that the foregoing shall not be construed to excuse the Issuing Bank from liability to the Borrower to the extent of any direct damages (as opposed to consequential damages, claims in respect of which are hereby waived by the Borrower to the extent permitted by applicable law) suffered by the Borrower that are caused by the Issuing Bank’s gross negligence or willful misconduct (as finally determined by a court of competent jurisdiction).  In furtherance of the foregoing and without limiting the generality thereof, the parties agree that, with respect to documents presented which appear on their face to be in substantial compliance with the terms of a Letter of Credit, the Issuing Bank may, in its sole discretion, either accept and make payment upon such documents without responsibility for further investigation, regardless of any notice or information to the contrary, or refuse to accept and make payment upon such documents if such documents are not in strict compliance with the terms of such Letter of Credit.

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

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

(j)                                     Replacement of the Issuing Bank.  The Issuing Bank may be replaced at any time by written agreement among the Borrower, the Administrative Agent, the replaced Issuing Bank and the successor Issuing Bank.  In addition, if the Borrower is required to pay any additional amount to the Issuing Bank pursuant to Sections 2.15 or 2.17, or if the Issuing Bank defaults in its obligation hereunder or if the Issuing Bank has become insolvent and its assets become subject to a receiver, liquidator, trustee, custodian or other officer having similar powers, then the Borrower may, at its sole expense and effort, upon notice to such Issuing Bank and the Administrative Agent, require the replacement of the Issuing Bank; provided that (i) the Borrower shall have received the prior written consent of the Administrative Agent, which consent shall not unreasonably be withheld and (ii) in the case of any replacement resulting from a claim for compensation under Section 2.15 or payments required to be made pursuant to Section 2.17, such replacement would result in a reduction in such compensation or payments in the future.  The Issuing Bank shall not be required to be replaced if, prior thereto, as a result of a waiver or

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

(k)                                  Cash Collateralization.  If any Event of Default shall occur and be continuing, on the Business Day that the Borrower receives notice from the Administrative Agent or the Required Lenders (or, if the maturity of the Loans has been accelerated, Lenders with L/C Exposure representing greater than 50% of the total L/C Exposure) demanding the deposit of cash collateral pursuant to this paragraph, the Borrower shall deposit dollars in an account with the Administrative Agent, in the name of the Administrative Agent and for the benefit of the Lenders, an amount in cash equal to the sum of the L/C Exposure as of such date that is denominated in dollars plus 102% of the L/C Exposure as of such date which is denominated in currencies other than dollars plus any accrued and unpaid interest thereon; provided that the obligation to deposit such cash collateral shall become effective immediately, and such deposit shall become immediately due and payable, without demand or other notice of any kind, upon the occurrence of any Event of Default with respect to the Borrower described in clause (h) or (i) of Section 8.01.  Each such deposit shall be held by the Administrative Agent as collateral for the payment and performance of the Obligations.  The Administrative Agent shall have exclusive dominion and control, including the exclusive right of withdrawal, over such account.  Other than any interest earned on the investment of such deposits, which investments shall be made at the option and sole discretion of the Administrative Agent and at the Borrower’s risk and expense, such deposits shall not bear interest.  Interest or profits, if any, on such investments shall accumulate in such account.  Moneys in such account shall be applied by the Administrative Agent to reimburse the Issuing Bank for L/C Disbursements for which it has not been reimbursed and, to the extent not so applied, shall be held for the satisfaction of the reimbursement obligations of the Borrower for the L/C Exposure at such time or, if the maturity of the Loans has been accelerated (but subject to the consent of Lenders with L/C Exposure  representing greater than 50% of the total L/C Exposure), be applied to satisfy other Obligations.  If the Borrower is required to provide an amount of cash collateral hereunder as a result of the occurrence of an Event of Default, such amount (to the extent not applied as aforesaid, together with the investment returns thereon) shall be returned to the Borrower within three Business Days after all Events of Default have been cured or waived, as determined by the Administrative Agent.

Section 2.06.                             Funding of Borrowings.

(a)                                  By Lenders.  Each Lender shall make each Loan to be made by it hereunder on the proposed date thereof by wire transfer of immediately available funds by 12:00 noon, Houston, Texas time, to the account of the Administrative Agent most recently designated by it for such purpose by notice to the Lenders; provided that Swingline Loans shall be made as provided in Section 2.04 and Synthetic L/C Loans shall be made as provided in Section 2.05(e)(i)(C)(1).  The Administrative Agent will make such Loans available to the Borrower by promptly crediting the amounts so received, in like funds, to an account of the Borrower maintained with the Administrative Agent or by wire transfer, automated clearing house debit or interbank transfer to such other account, accounts or Persons designated by the Borrower in the applicable Borrowing Request; provided that ABR Revolving Loans made to finance the

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reimbursement of an L/C Disbursement as provided in Section 2.05(e) shall be remitted by the Administrative Agent to the Issuing Bank and Synthetic L/C Loans shall be remitted by the Administrative Agent to the Issuing Bank as provided in Section 2.05(e)(i)(C)(1).

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

Section 2.07.                             Interest Elections.

(a)                                  Conversion and Continuation.  Each Revolving Borrowing and Term Borrowing initially shall be of the Type specified in the applicable Borrowing Request and, in the case of a Eurodollar Borrowing, shall have an initial Interest Period as specified in such Borrowing Request.  Thereafter, the Borrower may elect to convert such Borrowing to a different Type or to continue such Borrowing and, in the case of a Eurodollar Borrowing, may elect Interest Periods therefor, all as provided in this Section.  The Borrower may elect different options with respect to different portions of the affected Borrowing, in which case each such portion shall be allocated ratably among the Lenders holding the Loans comprising such Borrowing, and the Loans comprising each such portion shall be considered a separate Borrowing.  This Section shall not apply to Swingline Borrowings or to Synthetic L/C Borrowings, which may not be converted or continued.

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

(c)                                  Contents of Interest Election Request.  Each telephonic and written Interest Election Request shall specify the following information in compliance with Section 2.02 and paragraph (f) of this Section:

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

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

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

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

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

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

(e)                                  Automatic Conversion.  If the Borrower fails to deliver a timely Interest Election Request with respect to a Eurodollar Borrowing prior to the end of the Interest Period applicable thereto, then, unless such Borrowing is repaid as provided herein, at the end of such Interest Period such Borrowing shall be converted to an ABR Borrowing.

(f)                                    Limitations on Election.  Notwithstanding any contrary provision hereof, if an Event of Default exists and the Administrative Agent, at the request of the Required Lenders, so notifies the Borrower, then, so long as an Event of Default is continuing (i) no outstanding borrowing may be converted to or continued as a Eurodollar Borrowing and (ii) unless repaid, each Eurodollar Borrowing shall be converted to an ABR Borrowing at the end of the Interest Period applicable thereto.  A Borrowing of any Class may not be converted to or continued as a Eurodollar Borrowing if after giving effect thereto (i) the Interest Period therefor would commence before and end after a date on which any principal of the Loans of such Class is scheduled to be repaid and (ii) the sum of the aggregate principal amount of outstanding Eurodollar Borrowings of such Class with Interest Periods ending on or prior to such scheduled repayment date plus the aggregate principal amount of outstanding ABR Borrowings of such Class would be less than the aggregate principal amount of Loans of such Class required to be repaid on such scheduled repayment date.

Section 2.08.                             Termination and Reduction of Commitments.

(a)                                  Termination Date.  Unless previously terminated, (i) the Synthetic L/C Commitments shall terminate on the Term Loan Maturity Date (provided that all funding obligations of each Synthetic L/C Lender under its Synthetic L/C Commitment shall be satisfied upon such Synthetic L/C Lender’s making its deposit in its Credit Linked Account in accordance with the terms of Section 2.05(e)(i)(b)(1)), (ii) the Term B Commitments shall terminate upon the funding of the Term B Loans on the Effective Date, (iii) the Revolving Commitments shall terminate on the Revolving Maturity Date and (iv) each Incremental Term Loan Commitment shall terminate upon the funding of the related Incremental Term Loan.

(b)                                 Optional Termination or Reduction.  The Borrower may at any time terminate, or from time to time reduce, the Commitments of any Class; provided that (i) each reduction of the Commitments of any Class shall be in an amount that is an integral multiple of $500,000 and not less than $5,000,000, (ii) the Borrower shall not terminate or reduce the Revolving Commitments if, after giving effect to any concurrent prepayment of the Revolving Loans in accordance with Section 2.11, the sum of the Revolving Exposures would exceed the total Revolving Commitments and (iii) the Borrower shall not

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terminate or reduce the Synthetic L/C Commitments if the sum of the Synthetic Exposures would exceed the total Synthetic L/C Commitments.

(c)                                  Notice of Termination or Reduction.  The Borrower shall notify the Administrative Agent of any election to terminate or reduce the Commitments under paragraph (b) of this Section at least three Business Days prior to the effective date of such termination or reduction, specifying such election and the effective date thereof.  Promptly following receipt of any notice, the Administrative Agent shall advise the Lenders of the contents thereof.  Each notice delivered by the Borrower pursuant to this Section shall be irrevocable; provided that a notice of termination of the Revolving Commitments and Synthetic L/C Commitments delivered by the Borrower may state that such notice is conditioned upon the effectiveness of other credit facilities, in which case such notice may be revoked by the Borrower (by notice to the Administrative Agent on or prior to the specified effective date) if such condition is not satisfied.  Any termination or reduction of the Commitments of any Class shall be permanent.  Each reduction of the Commitments of any Class shall be made ratably among the Lenders in accordance with their respective Commitments of such Class.

Section 2.09.                             Repayment of Loans; Evidence of Debt.

(a)                                  Promise to Pay.  The Borrower hereby unconditionally promises to pay (i) to the Administrative Agent for the account of each Lender the then unpaid principal amount of each Revolving Loan of such Lender on the Revolving Maturity Date, (ii) to the Administrative Agent for the account of each Term Lender the then unpaid principal amount of each Term Loan of such Lender as provided in Section 2.10, (iii) to the Administrative Agent for the account of each Synthetic L/C Lender the then unpaid principal amount of each Synthetic L/C Loan on the Term Loan Maturity Date, (iv) to pay to the Administrative Agent for the account of each applicable Incremental Term Lender, the unpaid principal amount of each Incremental Term Loan made to it in installments on the dates and in the amounts indicated for the applicable Incremental Term Loan in the applicable Increased Commitment Supplement and (iv) to the Swingline Lender the then unpaid principal amount of each Swingline Loan on the earlier of the Revolving Maturity Date and the first date after such Swingline Loan is made that is the 15th or last day of a calendar month and is at least two Business Days after such Swingline Loan is made; provided that on each date that a Revolving Borrowing is made, the Borrower shall repay all Swingline Loans then outstanding.

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

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

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

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(e)                                  Request for a Note.  Any Lender may request that Loans of any Class made by it be evidenced by a promissory note.  In such event, the Borrower shall prepare, execute and deliver to such Lender a promissory note payable to such Lender (or, if requested by such Lender, to such Lender or its registered assigns) and in a form approved by the Administrative Agent.  Thereafter, the Loans evidenced by such promissory note and interest thereon shall at all times (including after assignment pursuant to Section 10.04) be represented by one or more promissory notes in such form payable to the order of the payee named therein (or, if such promissory note is a registered note, to such payee and its registered assigns).

Section 2.10.                             Amortization of Term B Loans.   The Borrower shall repay Term B Borrowings in installments as follows:

(i)                                     Quarterly installments due and payable on the first Business Day of each January, April, July and October commencing on January 2, 2007, in an amount equal to $575,000 each; and

(ii)                                  A final installment due on the Term Loan Maturity Date in an amount equal to the then outstanding principal amount of all Term B Loans.

Prior to any repayment of any Term B Borrowings, the Borrower shall select the Borrowing or Borrowings to be repaid and shall notify the Administrative Agent by telephone (confirmed by telecopy) of such selection not later than noon, Houston, Texas time, three Business Days before the scheduled date of such repayment.  Each repayment of a Term B Borrowing shall be applied ratably to the Term B Loans included in the repaid Borrowing.

Section 2.11.                             Prepayment of Loans.

(a)                                  Optional Prepayment.  The Borrower shall have the right at any time and from time to time to prepay any Borrowing in whole or in part, subject to the requirements of this Section and Section 2.16.

(b)                                 Mandatory Prepayment of Revolving Loans.  In the event and on such occasion that the sum of the Revolving Exposures exceeds the total Revolving Commitments, the Borrower shall prepay Revolving Borrowings or Swingline Borrowings (or, if no such Borrowings are outstanding, deposit cash collateral in an account with the Administrative Agent pursuant to Section 2.05(k)) in an aggregate amount equal to such excess.

(c)                                  Prepayments Offer from Net Proceeds of Prepayment Event.  In the event and on each occasion that any Net Proceeds are received by or on behalf of Holdings or any Subsidiary in respect of any Prepayment Event, the Borrower shall, within three Business Days after such Net Proceeds are received, make an offer to the Lenders to prepay Borrowings in an aggregate amount equal to such Net Proceeds on the date specified in such offer which date shall be no later than thirty days after the date of such offer; provided that, in the case of any event described in clause (a) of the definition of the term Prepayment Event, if the Borrower shall deliver to the Administrative Agent a certificate of a Financial Officer to the effect that the Holdings and the Subsidiaries intend to apply the Net Proceeds from such event, within 365 days after receipt of such Net Proceeds, to acquire real property, equipment or other tangible assets to be used in the business of the Borrower and the Subsidiaries or to pay the purchase price of an acquisition permitted by Section 6.04, and certifying that no Default has occurred and is continuing, then no offer to make a prepayment shall be required pursuant to this paragraph in respect of such event except to the extent of any Net Proceeds therefrom that have not been so applied by the end of such 365-day period, at which time an offer to make a prepayment shall be required in an amount equal to the Net Proceeds that have not been so applied.  Any offer delivered under this paragraph (c) shall constitute

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an irrevocable offer to prepay the Borrowings on the date specified in such offer in accordance with the application of proceeds provisions of paragraph (e) of this Section and shall include a reasonably detailed calculation of the amount of prepayment offered.

(d)                                 Excess Cash Flow Prepayment Offer.  Following the end of each fiscal year of the Borrower, commencing with the fiscal year ending on or about December 31, 2007, the Borrower shall make an offer to the Lenders to prepay Borrowings in an aggregate amount equal to the Required Percentage of Excess Cash Flow for such fiscal year on the date specified in such offer which date shall be no later than thirty days after the date of such offer; provided that no offer of prepayment will be required to be made with respect to a fiscal year if the Required Percentage of Excess Cash Flow as calculated for such fiscal year is less than $1,000,000.  Each offer of prepayment pursuant to this paragraph shall be made on or before the date on which financial statements are delivered pursuant to Section 5.01 with respect to the fiscal year for which Excess Cash Flow is being calculated.  Any offer delivered under this paragraph shall constitute an irrevocable offer to prepay the Borrowings on the date specified in such offer in accordance with the application of proceeds provisions of paragraph (e) of this Section and shall include a reasonably detailed calculation of the amount of prepayment offered.  As used in this paragraph, the term “Required Percentage” means with respect to a fiscal year, the applicable percentage set forth below under the caption “Required Percentage”, based upon the Leverage Ratio as calculated for such fiscal year:

For purposes of the foregoing, the Leverage Ratio shall be determined as of the end of such fiscal year based upon Holdings’ consolidated financial statements delivered pursuant to Section 5.01(a); provided that the Leverage Ratio shall be deemed to be in Category 1 at the option of the Required Lenders:  (A) if at any time that an Event of Default exists or (B)  if Holdings fails to deliver the consolidated financial statements required to be delivered by it pursuant to Section 5.01(a).

(e)                                  Acceptance or Rejection of Prepayment Offer.  A Lender may accept or reject the offer to prepay pursuant to paragraphs (c) and (d) of this Section by causing a notice of such acceptance or rejection to be delivered to the Borrower within ten days after such Lender’s receipt of the offer.  A failure of a Lender to respond to an offer to prepay under paragraphs (c) and (d) of this Section shall constitute a rejection of such offer by such Lender.  If no Lender accepts an offer of prepayment made under this Section, the Borrower shall have no obligation to make the prepayment offer thereby.  If an offer is accepted by one or more Lenders, then the amount of the offered prepayment shall be applied to the Borrowings in the following order:

(i)                                     First, to the Term Borrowings held by the Lenders who have accepted such offer, pro rata based on the principal amount of the Term Borrowings held by each;

(ii)                                  Second, to the extent funds are available after the application required by clause (i), to the Synthetic L/C Borrowings held by the Lenders who have accepted such offer, pro rata based on the principal amount of the Synthetic L/C Borrowings held by each and on the date that such

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prepayment is applied, the Synthetic L/C Commitment of such Lenders shall be reduced by an aggregate amount equal to the amount of the required prepayment; and

(iii)                               Third, to the extent funds are available after the applications required by clauses (i) and (ii), to the Revolving Borrowings held by the Lenders who have accepted such offer, pro rata based on the principal amount of the Revolving Borrowings held by each and on the date that such prepayment is applied, the Revolving Commitment of such Lenders shall be reduced by an aggregate amount equal to the amount of the required prepayment.

(f)                                    Notice of Prepayment; Application of Prepayments.  The Borrower shall notify the Administrative Agent (and, in the case of prepayment of a Swingline Loan, the Swingline Lender) by telephone (confirmed by telecopy) of any optional prepayment hereunder (i) in the case of prepayment of a Eurodollar Borrowing, a Synthetic L/C Borrowing or any other Term Borrowing, not later than 11:00 a.m., Houston, Texas time, three Business Days before the date of prepayment, (ii) in the case of prepayment of an ABR Borrowing, not later than 11:00 a.m., Houston, Texas time, one Business Day before the date of prepayment or (iii) in the case of prepayment of a Swingline Loan, not later than 12:00 noon, Houston, Texas time, on the date of prepayment.  Each such notice shall be irrevocable and shall specify the prepayment date, the principal amount of each Borrowing or portion thereof to be prepaid; provided that, if a notice of optional prepayment of any Loan is given in connection with a conditional notice of termination of the Revolving Commitments and the Synthetic L/C Commitments as contemplated by Section 2.08, then such notice of prepayment may be revoked if such notice of termination is revoked in accordance with Section 2.08.  Promptly following receipt of any such notice (other than a notice relating solely to Swingline Loans), the Administrative Agent shall advise the Lenders of the contents thereof.  Each partial optional prepayment of any Borrowing shall be in an amount that would be permitted in the case of an advance of a Borrowing of the same Type as provided in Section 2.02.  Each optional prepayment of a Borrowing shall be applied ratably to the Loans included in the prepaid Borrowing.  Prepayments shall be accompanied by accrued interest to the extent required by Section 2.13.  Optional prepayments of the Term Loans will be applied to all the remaining installments due thereunder, each installment to be reduced by its pro rata portion of the amount of the prepayment, with an installment’s pro rata portion determined based on the principal amount of the installment.  Mandatory prepayments of the Term Loans of a Lender who has accepted the offer of prepayment will be applied to all the remaining installments due to such Lender thereunder, each installment to be reduced by its pro rata portion of the amount of the prepayment, with an installment’s pro rata portion determined based on the principal amount of the installment.

Section 2.12.                             Fees.

(a)                                  Commitment Fees.  The Borrower agrees to pay to the Administrative Agent for the account of each Revolving Lender a commitment fee, which shall accrue at the Applicable Rate on the average daily unused amount of each Revolving Commitment of such Lender during the period from and including the Effective Date to but excluding the date on which such Revolving Commitment terminates.  Accrued commitment fees shall be payable in arrears, on the date which is three Business Days following the last day of each March, June, September and December of each year and on the date on which the Revolving Commitments terminate, commencing on the first such date to occur after the date hereof.  All commitment fees shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed (including the first day but excluding the last day).  A Revolving Commitment of a Lender shall be deemed to be used to the extent of the outstanding Revolving Loans and Revolving L/C Exposure of such Lender (and the Swingline Exposure of such Lender shall be disregarded for such purpose).

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(b)                                 Letter of Credit Fees.  The Borrower agrees to pay (i) to the Administrative Agent for the account of each Revolving Lender a participation fee with respect to its participations in Revolving Letters of Credit, which shall accrue at the same Applicable Rate as interest on Eurodollar Revolving Loans on the average daily amount of such Lender’s Revolving L/C  Exposure (excluding any portion thereof attributable to unreimbursed Revolving L/C Disbursements) during the period from and including the Effective Date to but excluding the later of the date on which such Lender’s Revolving Commitment terminates and the date on which such Lender ceases to have any Revolving L/C Exposure, (ii) to the Administrative Agent for the account of each Synthetic L/C Lender a participation fee with respect to its participations in Synthetic Letters of Credit, which shall accrue at the per annum rate equal to 2.50% on the average daily amount of such Lender’s Synthetic L/C  Exposure (excluding any portion thereof attributable to unreimbursed Synthetic L/C Disbursements) during the period from and including the Effective Date to but excluding the later of the date on which such Lender’s Synthetic L/C Commitment terminates and the date on which such Lender ceases to have any Synthetic L/C Exposure, and (iii) to the Issuing Bank a fronting fee, which shall accrue at the rate of 0.125% per annum on the average daily amount of the L/C Exposure (excluding any portion thereof attributable to unreimbursed L/C Disbursements) during the period from and including the Effective Date to but excluding the later of the date of termination of both the Revolving Commitments and the Synthetic L/C Commitments and the date on which there ceases to be any L/C Exposure, as well as the Issuing Bank’s standard fees with respect to the issuance, amendment, renewal or extension of any Letter of Credit or processing of drawings thereunder.  Participation fees and fronting fees accrued through and including the last day of December, March, June and September of each year shall be payable on the third Business Day following such last day, commencing on the first such date to occur after the Effective Date; provided that all such fees applicable to Revolving Letters of Credit shall be payable on the date on which the Revolving Commitments terminate, all such fees applicable to Synthetic Letters of Credit shall be payable on the date on which the Synthetic Commitments terminate and any such fees accruing after the date on which the applicable Commitments terminate shall be payable on demand.  Any other fees payable to the Issuing Bank pursuant to this paragraph shall be payable within 10 days after demand.  All participation fees and fronting fees shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed (including the first day but excluding the last day).

(c)                                  Fixed Return Fee.  The Borrower shall pay a fee to the Administrative Agent, for the account of each Synthetic L/C Lender, quarterly in arrears for each calendar quarter (or portion thereof), an amount equal to the excess of (i) the Fixed Return over (ii) the Actual Return, in each case with respect to such Synthetic L/C Lender for such calendar quarter (or portion thereof) (but only if such amount constituting the difference between the amounts provided for in items (i) and (ii) above is greater than $0).  Each such amount accrued through and including the last day of March, June, September and December of each year shall be payable on the third Business Day following such last day commencing on the first such date to occur after the Effective Date and on the date that the Credit Linked Accounts are closed under subparagraph (e)(i)(C)(6) of Section 2.05.  For purposes of this Agreement, the following defined terms shall have the following meanings:

“Actual Return” means for any calendar quarter (or portion thereof) referred to in subparagraph (c) above and, with respect to any Synthetic L/C Lender, an amount equal to (i) the aggregate amount of return due to such Synthetic L/C Lender from the Administrative Agent pursuant to Section 2.05(e)(i)(D) plus (ii) the aggregate amount of interest payments received by such Synthetic L/C Lender from the Borrower pursuant to Section 2.13 in respect of Synthetic L/C Loans plus (iii) the aggregate amount of letter of credit fees received by such Synthetic L/C Lender from the Borrower pursuant to Section 2.12(b), in each case with respect to such calendar quarter (or portion thereof).

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“Fixed Return” means for any calendar quarter (or portion thereof) referred to in subparagraph (c) above and, with respect to any Synthetic L/C Lender, an amount equal to the interest that would have accrued on the amount of such Lender’s Synthetic L/C Commitment during such quarterly period (or portion thereof) if such interest were calculated at a rate per annum equal to (i) the One Month Adjusted LIBO Rate (as calculated for each month during such quarter) plus (ii) either 2.50% or, if applicable, the percentage determined in accordance with Section 2.20(f) hereof (on the basis of the actual number of days elapsed over a year of 360 days).

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

(e)                                  Payment of Fees.  All fees payable hereunder shall be paid on the dates due, in immediately available funds, to the Administrative Agent (or to the Issuing Bank, in the case of fees payable to it) for distribution, in the case of commitment fees and participation fees, to the Lenders entitled thereto.  Fees paid shall not be refundable under any circumstances.

Section 2.13.                             Interest.  Except as may otherwise be provided with respect to an Incremental Term Loan in its Increased Commitment Supplement:

(a)                                  ABR Borrowings.  The Loans comprising each ABR Borrowing (including each Swingline Loan) shall bear interest at the Alternate Base Rate plus the Applicable Rate.

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

(c)                                  Synthetic L/C Loans.  Synthetic L/C Loans shall bear interest at the One Month Adjusted LIBO Rate plus the Applicable Rate; provided that if any Event of Default exists and the Administrative Agent provides the Borrower notice thereof, the Synthetic L/C Loans shall bear interest at the Alternate Base Rate plus the Applicable Rate applicable to ABR Term Loans.

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

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

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

Section 2.14.                             Alternate Rate of Interest.  If prior to the commencement of any Interest Period for a Eurodollar Borrowing or on or prior to the date of the determination of any One Month Adjusted LIBO Rate or one month London interbank offered rate under Section 2.05(e)(i)(D):

(a)                                  the Administrative Agent determines (which determination shall be conclusive absent manifest error) that adequate and reasonable means do not exist for ascertaining the Adjusted LIBO Rate for such Interest Period, the One Month Adjusted LIBO Rate or the one month London interbank offered rate; or

(b)                                 the Administrative Agent is advised by the Required Lenders that the Adjusted LIBO Rate for such Interest Period or the One Month Adjusted LIBO Rate will not adequately and fairly reflect the cost to the Lenders of making or maintaining their Loans included in the applicable Borrowing as a result of the failure of the Lenders participating in such Borrowing to have access to the London interbank market or as a result of any other circumstance affecting the London interbank market or the position in such market of the Lenders participating in such Borrowing;

then the Administrative Agent shall give notice thereof to the Borrower and the Lenders by telephone or telecopy as promptly as practicable thereafter and, until the Administrative Agent notifies the Borrower and the Lenders that the circumstances giving rise to such notice no longer exist: (i) any Interest Election Request that requests the conversion of any Borrowing to, or continuation of any Borrowing as, a Eurodollar Borrowing shall be ineffective; (ii) if any Borrowing Request requests a Eurodollar Borrowing, such Borrowing shall be made as an ABR Borrowing; and (iii) the One Month Adjusted LIBO Rate and/or the one month London interbank offered rate under Section 2.05(e)(i)(D) that is subject to the circumstances giving rise to the notice under this Section shall be equal to the greater of the Federal Funds Effective Rate or a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation.

Section 2.15.                             Increased Costs.

(a)                                  Change In Law.  If any Change in Law shall:

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

(ii)                                  impose on any Lender or the Issuing Bank or the London interbank market any other condition affecting this Agreement, the Synthetic L/C Commitments of such Lender or the Eurodollar Loans or Synthetic L/C Loans made by such Lender or any Letter of Credit or participation therein (other than with respect to taxes, which shall be governed solely and exclusively by Section 2.17);

and the result of any of the foregoing shall be to increase the cost to such Lender of making or maintaining its Synthetic L/C Commitments, any Eurodollar Loan or Synthetic L/C Loan (or of maintaining its obligation to make any such Loan) or to increase the cost to such Lender or the Issuing

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Bank of participating in, issuing or maintaining any Letter of Credit or to reduce the amount of any sum received or receivable by such Lender or the Issuing Bank hereunder (whether of principal, interest or otherwise), then the Borrower will pay to such Lender or the Issuing Bank, as the case may be, such additional amount or amounts as will compensate such Lender or the Issuing Bank, as the case may be, for such additional costs incurred or reduction suffered.

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

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

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

Section 2.16.                             Break Funding Payments.  In the event of (a) the payment of any principal of any Eurodollar Loan other than on the last day of an Interest Period applicable thereto (including as a result of an Event of Default), (b) the conversion of any Eurodollar Loan other than on the last day of the Interest Period applicable thereto, (c) the failure to borrow, convert, continue or prepay any Revolving Loan or Term Loan on the date specified in any notice delivered pursuant hereto (regardless of whether such notice may be revoked under Section 2.11(f) and is revoked in accordance therewith), (d) the assignment of any Eurodollar Loan or Synthetic L/C Commitment or Synthetic L/C Loan other than on the last day of the Interest Period applicable thereto as a result of a request by the Borrower pursuant to Section 2.19(b), 2.20(d) or the definition of the term “Revolving Commitment”, or (e) the payment of any principal of any Synthetic L/C Loan other than on the last day of an Interest Period applicable thereto (including as a result of an Event of Default), then, in any such event, the Borrower shall compensate each Lender for the actual loss, cost and expense attributable to such event.  Such loss, cost or expense to any Lender shall be deemed to include an amount determined by such Lender to be the excess, if any, of (i) the amount of interest which would have accrued on the principal amount of such Loan had such event not occurred, at the Adjusted LIBO Rate or, as applicable, One Month Adjusted LIBO Rate that would have been applicable to such Loan, for the period from the date of such event to the last day of the then current

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Interest Period therefor (or, in the case of a failure to borrow, convert or continue, for the period that would have been the Interest Period for such Loan), over (ii) the amount of interest which would accrue on such principal amount for such period at the interest rate which such Lender would bid were it to bid, at the commencement of such period, for dollar deposits of a comparable amount and period from other banks in the eurodollar market.  A certificate of any Lender setting forth any amount or amounts that such Lender is entitled to receive pursuant to this Section shall be delivered to the Borrower and shall be conclusive absent manifest error.  The Borrower shall pay such Lender the amount shown as due on any such certificate within 10 days after receipt thereof.

Section 2.17.                             Taxes.

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

(b)                                 Payment of Other Taxes.  In addition (but without duplication of Section 2.17(a)), the Borrower shall pay any Other Taxes to the relevant Governmental Authority in accordance with applicable law.

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

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

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

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an “exempt recipient” (within the meaning of Treasury Regulations Section 1.6049-4(c), without regard to the third sentence thereof) shall not be required to deliver an IRS Form W-9.

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

Section 2.18.                             Payments Generally; Pro Rata Treatment; Sharing of Set-Offs; Proceeds of Collateral.

(a)                                  Payments Generally.  The Borrower shall make each payment required to be made by it hereunder or under any other Loan Document (whether of principal, interest, fees or reimbursement of L/C Disbursements, or of amounts payable under Section 2.15, 2.16 or 2.17, or otherwise) prior to the time expressly required hereunder or under such other Loan Document for such payment (or, if no such time is expressly required, prior to 12:00 noon, Houston, Texas time), on the date when due, in immediately available funds, without set-off or counterclaim.  Any amounts received after such time on any date may, in the discretion of the Administrative Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon.  All such payments shall be made to the Administrative Agent at its offices at ▇▇▇▇ ▇▇▇▇▇▇, ▇^▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇  ▇▇▇▇▇, except payments to be made directly to the Issuing Bank or Swingline Lender as expressly provided herein and except that payments pursuant to Sections 2.15, 2.16, 2.17 and 10.03 shall be made directly to the Persons entitled thereto and payments pursuant to other Loan Documents shall be made to the Persons specified therein.  The Administrative Agent shall distribute any such payments received by it for the account of any other Person to the appropriate recipient promptly following receipt thereof.  If any payment under any Loan Document shall be due on a day that is not a Business Day, the date for payment shall be extended to the next succeeding Business Day, and, in the case of any payment accruing interest, interest thereon shall be payable for the period of such extension.  All payments under each Loan Document shall be made in dollars.

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

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

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

(e)                                  Set-Off Against Amounts Owed Lenders.  If any Lender shall fail to make any payment required to be made by it under this Agreement, then the Administrative Agent may, in its discretion (notwithstanding any contrary provision hereof), apply any amounts thereafter received by the Administrative Agent for the account of such Lender to satisfy such Lender’s obligations under this Agreement until all such unsatisfied obligations are fully paid.

(f)                                    Application of Proceeds of Collateral and Guaranty.  All amounts received under the Guaranty Agreement and all proceeds received by the Administrative Agent from the sale or other liquidation of the Collateral when an Event of Default exists shall first be applied as payment of the accrued and unpaid fees of the Administrative Agent hereunder and then to all other unpaid or unreimbursed Obligations (including reasonable attorneys’ fees and expenses) owing to the Administrative Agent in its capacity as Administrative Agent only and then any remaining amount of such proceeds shall be distributed:

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(i)                                     first, to the Secured Parties, pro rata in accordance with the respective unpaid amounts of Loan Obligations (including L/C Exposure) and Swap Obligations, until all the Loan Obligations and Swap Obligations have been Fully Satisfied ;

(ii)                                  second, to the Secured Parties, pro rata in accordance with the respective unpaid amounts of the Deposit Obligations, until all Deposit Obligations have been Fully Satisfied; and

(iii)                               third, to the Secured Parties, pro rata in accordance with the respective unpaid amounts of the remaining Obligations.

After all the Obligations have been Fully Satisfied, any proceeds of Collateral shall be delivered to the Person entitled thereto as directed by the Borrower or as otherwise determined by applicable law or applicable court order.

(g)                                 Noncash Proceeds.  Notwithstanding anything contained herein to the contrary, if the Administrative Agent shall ever acquire any Collateral through foreclosure or by a conveyance in lieu of foreclosure or by retaining any of the Collateral in satisfaction of all or part of the Obligations or if any proceeds of Collateral received by the Administrative Agent to be distributed and shared pursuant to this Section 2.18 are in a form other than immediately available funds, the Administrative Agent shall not be required to remit any share thereof under the terms hereof and the Secured Parties shall only be entitled to their undivided interests in the Collateral or noncash proceeds as determined by paragraph (f) of this Section 2.18.  The Secured Parties shall receive the applicable portions (in accordance with the foregoing paragraph (f)) of any immediately available funds consisting of proceeds from such Collateral or proceeds of such noncash proceeds so acquired only if and when received by the Administrative Agent in connection with the subsequent disposition thereof.  While any Collateral or other property to be shared pursuant to this Section is held by the Administrative Agent pursuant to this paragraph (g), the Administrative Agent shall hold such Collateral or other property for the benefit of the Secured Parties and all matters relating to the management, operation, further disposition or any other aspect of such Collateral or other property shall be resolved by the agreement of the Required Lenders.

(h)                                 Return of Proceeds.  If at any time payment, in whole or in part, of any amount distributed by the Administrative Agent hereunder is rescinded or must otherwise be restored or returned by the Administrative Agent as a preference, fraudulent conveyance, or otherwise under any bankruptcy, insolvency, or similar law, then each Person receiving any portion of such amount agrees, upon demand, to return the portion of such amount it has received to the Administrative Agent.

Section 2.19.                             Mitigation Obligations; Replacement of Lenders.

(a)                                  Mitigation.  If any Lender requests compensation under Section 2.15, or if the Borrower is required to pay any additional amount to or for the benefit of the Issuing Bank or any Lender or any Governmental Authority pursuant to Section 2.17, then such Lender or Issuing Bank shall use reasonable efforts to designate a different lending office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Lender or Issuing Bank, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 2.15 or 2.17, as the case may be, in the future and (ii) would not subject such Lender or Issuing Bank to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender or Issuing Bank.

(b)                                 Replacement.  If a Lender requests compensation under Section 2.15, or if the Borrower is required to pay any additional amount to a Lender or any Governmental Authority for the account of a Lender pursuant to Section 2.17, or if a Lender defaults in its obligation to fund Loans hereunder, or if a Lender has become insolvent and its assets become subject to a receiver, liquidator,

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trustee, custodian or other officer having similar powers or if a Lender shall become a Non-consenting Lender (as defined below), then the Borrower may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in Section 10.04), all its interests, rights and obligations under this Agreement to an assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided that (i) the Borrower shall have received the prior written consent of the Administrative Agent to the extent required by Section 10.04, which consent shall not unreasonably be withheld, (ii) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans and participations in LC Disbursements and Swingline Loans, accrued interest thereon, accrued fees and all other amounts payable to it hereunder, from the assignee (to the extent of such outstanding principal and accrued interest and fees) or the Borrower (in the case of all other amounts) and (iii) in the case of any such assignment resulting from a claim for compensation under Section 2.15 or payments required to be made pursuant to Section 2.17, such assignment would result in a reduction in such compensation or payments in the future.  A Lender shall not be required to make any such assignment and delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply.  In the event that (i) the Borrower or the Administrative Agent have requested the Lenders to consent to a departure or waiver of any provisions of the Loan Documents or to agree to any other modification thereto, (ii) the consent, waiver or other modification in question requires the agreement of all Lenders (or all affected Lenders) in accordance with the terms of Section 10.02 and (iii) the Required Lenders (or, in the case of any Class voting, the holders of a majority of the outstanding Loans and unused Commitments in respect of such Class) have agreed to such consent, waiver or other modification, then any Lender who does not agree to such consent, waiver or other modification shall be deemed a “Non-consenting Lender”.

Section 2.20.                             Increase of Commitments.

(a)                                  Notice.  In addition to the increase of the Revolving Commitments permitted by the definition of the term “Revolving Commitment”, by written notice sent to the Lenders, the Borrower may provide notice of an increase of the Revolving Commitments, Synthetic L/C Commitments or the Term Loans or an increase in any combination thereof: (i) by an aggregate amount equal to any integral multiple of $5,000,000 and not less than $25,000,000 for each such increase and (ii) by an aggregate amount not to exceed $100,000,000 for all such increases; provided that, as of the effective date of the increase:

(A)                              no Default shall have occurred and be continuing,

(B)                                the Commitments being increased shall not have been reduced on more than one occasion, nor shall the Borrower have given notice of any such reduction under Section 2.08 on more than one occasion (for avoidance of doubt, repayments of the Loans shall not be considered reductions of Commitments),

(C)                                the Borrower may not utilize this Section 2.20 to increase any Commitments or the Term Loans on more than 4 occasions (not including the increase of the Revolving Commitments contemplated by the definition thereof);

(D)                               prior to the effectiveness of the increase, the Borrower shall deliver to the Administrative Agent and the Lenders (A) projected income and cash flow statements for the Borrower for the period through the Term Loan Maturity Date, prepared on a basis acceptable to the Administrative Agent giving pro forma effect to the Indebtedness to be incurred in connection with such increase and (B) a certificate signed by a Financial Officer certifying and providing evidence of the

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calculations demonstrating: (1) that the Borrower shall be in compliance with the covenants in Article VII on a pro forma basis for the four fiscal quarter periods then most recently ending for which financial statements are available and on a projected basis through the Term Loan Maturity Date (assuming, in each case, that the incurrence of the Indebtedness occurred on the first day of the applicable period and to the extent such Indebtedness bears interest at a floating rate, using the rate in effect at the time of calculation for the entire period of calculation); (2) no Default exists or will result after giving effect to the incurrence of the Indebtedness; and (3) the representations and warranties of each Loan Party set forth in the Loan Documents are true and correct on and as of the date of such certificate in all material respects, with the same force and effect as if such representations and warranties had been made on and as of such date except to the extent such representations and warranties relate specifically to another date; and

(E)                                 no Lender shall be obligated to participate in any increase of the Commitments or Loans, any decision to do so to be made in the sole discretion of each Lender.

(b)                                 New Lenders.  If one or more of the Lenders holding a Commitment of the type being increased is not increasing such Commitment, then another one or more financial institutions or other lenders, each as approved by the Administrative Agent (which approval will not be unreasonably withheld or delayed and each such financial institution or other lender, herein a “New Lender”), may commit to provide an amount equal to the aggregate amount of the requested increase that will not be provided by the applicable existing Lenders (the “Increased Amount”); provided, any Revolving Commitment of a New Lender shall be at least $5,000,000 and any Synthetic L/C Commitment and any Incremental Term Loan Commitment of a New Lender shall be at least $1,000,000.

(c)                                  Increased Commitment Supplement.  Upon receipt of notice from the Borrower under this Section 2.20 that the Lenders, or sufficient Lenders and New Lenders, have agreed to commit to an aggregate amount equal to the Increased Amount, then: provided that no Default exists at such time or after giving effect to the requested increase, Holdings, the Borrower, the Administrative Agent, and the Lenders willing to increase their respective Commitments and the New Lenders (if any) shall execute and deliver an Increased Commitment Supplement (herein so called) in the form attached hereto as Exhibit D.

(d)                                 Increase of Revolving Commitment.  If all existing Lenders shall not have provided their pro rata portion of the requested increase of the Revolving Commitment under this Section 2.20, then after giving effect to the increase, the outstanding Revolving Loans may not be held pro rata in accordance with the new Revolving Commitments.  In order to remedy the foregoing, on the effective date of the Increased Commitment Supplement, the Revolving Lenders shall make advances among themselves (either directly or through the Administrative Agent) so that after giving effect thereto the Revolving Loans will be held by the Revolving Lenders pro rata in accordance with their respective Applicable Percentages.  Any advances made under this Section 2.20(d) by a Revolving Lender shall be deemed to be a purchase of a corresponding amount of the Revolving Loans of the Revolving Lender or Lenders who shall receive such advances.  The Revolving Commitments of the Revolving Lenders who do not agree to increase their Revolving Commitments cannot be reduced or otherwise changed pursuant to this Section 2.20.

(e)                                  Increase of Synthetic L/C Commitments.  On or prior to the effective date of any Increased Commitment Supplement increasing the total Synthetic L/C Commitments, the Administrative Agent shall establish additional Credit Linked Accounts at JPMCB in the names of each New Lender that becomes a Synthetic L/C Lender pursuant thereto.  Each such New Lender and each Synthetic L/C Lender that is increasing its Synthetic L/C Commitment, shall make the deposits in its Credit Linked Account required by Section 2.05(e)(i)(B)(5).

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(f)                                    Incremental Term Loan.  Each Increased Commitment Supplement that increases the Term Loans shall set forth the following information, with respect to the additional Term Loan requested:  (i) the aggregate amount thereof; (ii) the Lenders or New Lenders who will be providing such additional Term Loan and the amount of each of their commitments therefore; (iii) the final maturity and amortization schedule for such additional Term Loan; (iv) the date the additional Term Loan is to be made; (v) whether such additional Term Loan shall be an ABR Loan or a Eurodollar Loan, and if a Eurodollar Loan, the Interest Periods to be initially applicable thereto; and (vi) if different than the Applicable Rates set forth herein, the Applicable Rates to be applicable thereto; provided that:

(A)                              an Increased Commitment Supplement may provide that the Incremental Term Loan to be made pursuant thereto will accrue interest at an alternative rate or alternative rates of interest other than as provided herein; and

(B)                                if the Total Return (as defined below in this paragraph) payable to the Lenders providing such additional Term Loan (such Total Return, herein the “New Total Return”) exceeds by more than 0.50% the Total Return payable to the Lenders who hold Term Loans and Synthetic L/C Loans as of the date such additional Term Loan is made, then the Applicable Rate used to calculate the interest on the then existing Term Loans and the Fixed Return rate used to calculate the fee then payable under Section 2.12(c) shall each be adjusted by an amount determined by the Administrative Agent to be necessary so the Total Return payable to the Lenders who hold Term Loans and Synthetic L/C Loans as of the date such additional Term Loan is made equals the New Total Return minus 0.50% (as used in this paragraph (B), the term “Total Return” means, with respect to a Loan, the projected rate of return expressed as a percentage to be earned on such Loan over its life calculated by the Administrative Agent in a manner to include the interest rate payable thereunder, all upfront or similar fees payable in connection therewith and any original issue discounts.  If the interest rate for any Loan is based on a variable rate, the rate in effect as of the date of the calculation of the Total Return shall be deemed to be the rate in effect throughout its life).

No Incremental Term Loan shall have a final maturity date earlier than the Term Loan Maturity Date and no Incremental Term Loan shall have a weighted average life to maturity that is shorter than the then-remaining weighted average life to maturity of the Term B Loans.

ARTICLE III.

Representations and Warranties

Holdings represents and warrants to the Lenders that:

Section 3.01.                             Organization; Powers.  Each of Holdings and each Subsidiary is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, has all requisite power and authority to carry on its business as now conducted and, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect, is qualified to do business in, and is in good standing in, every jurisdiction where such qualification is required.

Section 3.02.                             Authorization; Enforceability.  The Transactions to be entered into by each Loan Party are within such Loan Party’s corporate or other powers and have been duly authorized by all necessary corporate (or other) and, if required, stockholder action.  This Agreement has been duly executed and delivered by each of Holdings and the Borrower and constitutes, and each other Loan Document to which any Loan Party is to be a party, when executed and delivered by such Loan Party, will constitute, a legal, valid and binding obligation of such Loan Party (as the case may be), enforceable

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in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.

Section 3.03.                             Governmental Approvals; No Conflicts.   The Transactions (a) do not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except such as have been obtained or made and are in full force and effect and except filings necessary to perfect Liens created under the Loan Documents, (b) will not violate in any material respect any applicable law or regulation or the charter, by-laws or other organizational documents of Holdings or any of the Subsidiaries or any order of any Governmental Authority, (c) will not violate or result in a default under any indenture or other agreement relating to any Material Indebtedness or under any other material agreement binding upon Holdings or any of the Subsidiaries or its assets, or give rise to a right thereunder to require any payment to be made by Holdings or any of the Subsidiaries, and (d) will not result in the creation or imposition of any Lien on any asset of Holdings or any of the Subsidiaries, except Liens created under the Loan Documents.

Section 3.04.                             Financial Condition; No Material Adverse Change.

(a)                                  Financial Statements.  Holdings has heretofore furnished to the Lenders its consolidated balance sheet and statements of income, stockholders equity and cash flows (i) as of and for the fiscal year ended December 31, 2005, reported on by certified, independent public accountants, and (ii) as of and for the fiscal quarter and the portion of the fiscal year ended on or about April 22, 2006, certified by its chief financial officer.  Such financial statements present fairly, in all material respects, the financial position and results of operations and cash flows of Holdings and the Subsidiaries as of such dates and for such periods in accordance with GAAP, subject to year-end audit adjustments and the absence of footnotes in the case of the statements referred to in clause (ii) above.

(b)                                 Pro Forma.  Holdings has heretofore furnished to the Lenders its pro forma consolidated balance sheet as of the end of its first fiscal quarter ended on or about April 22, 2006, prepared giving effect to the Transactions as if the Transactions had occurred on such date.  Such pro forma consolidated balance sheet (i) has been prepared in good faith based on the same assumptions used to prepare the pro forma financial statements included in the Information Memorandum (which assumptions are believed by Holdings to be reasonable), (ii) is based on the best information available to Holdings and the Borrower after due inquiry, (iii) accurately reflects all adjustments necessary to give effect to the Transactions and (iv) presents fairly, in all material respects, the pro forma financial position of the Holdings and the Subsidiaries as of the end of its first fiscal quarter ended on or about April 22, 2006 as if the Transactions had occurred on such date.

(c)                                  Projections.  Holdings’ forecasted consolidated balance sheets, profit and loss statements and cash flow statements set forth in the Information Memorandum have been prepared by Holdings in light of the business of Holdings and Transactions and represent as of the date thereof the good faith estimate of Holdings and its senior management of the future financial performance of the Holdings, after giving pro forma effect to the Transactions (it being understood that such projections may vary from actual results and such variances may be material).

(d)                                 No Undisclosed Liabilities.  Except as disclosed in the financial statements referred to above or the notes thereto or in the Information Memorandum, after giving effect to the Transactions, none of Holdings or the Subsidiaries has, as of the Effective Date, any material contingent liabilities, material unusual long-term commitments or material unrealized losses.

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(e)                                  Material Adverse Change.  Since December 31, 2005, there has been no material adverse change in the business, assets, operations, prospects or condition, financial or otherwise, of the Loan Parties taken as a whole.

Section 3.05.                             Properties.

(a)                                  Title; Liens.  Each of Holdings and each Subsidiary has good title to, or valid leasehold interests in, all its real and personal property material to its business (including its Mortgaged Properties), except for minor defects in title that do not interfere with its ability to conduct its business as currently conducted or to utilize such properties for their intended purposes, and all such property is owned free and clear of all Liens except for Liens permitted by Section 6.02.

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

(c)                                  Notice of Condemnation.  As of the Effective Date, neither Holdings nor any of the Subsidiaries has received notice of, or has knowledge of, any pending or contemplated condemnation proceeding affecting any Mortgaged Property or any sale or disposition thereof in lieu of condemnation.  Neither any Mortgaged Property nor any interest therein is subject to any right of first refusal, option or other contractual right to purchase such Mortgaged Property or interest therein.

Section 3.06.                             Litigation and Environmental Matters.

(a)                                  Litigation.  There are no actions, suits or proceedings by or before any arbitrator or Governmental Authority pending against or, to the knowledge of Holdings, threatened against or affecting Holdings or any of the Subsidiaries (i) as to which there is a reasonable possibility of an adverse determination and that, if finally and adversely determined, could reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect or (ii) that involve any of the Loan Documents or the Transactions as of the Effective Date.

(b)                                 Environmental Matters.  Except with respect to any other matters that, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect, neither Holdings nor any of the Subsidiaries: (i) has failed to comply with any Environmental Law or to obtain, maintain or comply with any permit, license or other approval required under any Environmental Law, (ii) has become subject to any Environmental Liability, (iii) has received notice of any claim with respect to any Environmental Liability or (iv) knows of any basis for any Environmental Liability or of any facts, circumstances, conditions or occurrences with respect to the business or operations of Holdings or any of the Subsidiaries, or any real property owned, leased or operated by Holdings or any of the Subsidiaries (including any of the Mortgage Property formerly owned, leased or operated by Holdings or any of the Subsidiaries but no longer owned, leased or operated by Holdings or any of the Subsidiaries) or any property adjoining or adjacent to any such real property that has (i) formed the basis of an Environmental Liability against Holdings or any of the Subsidiaries or any real property owned, leased or operated by Holdings or any of the Subsidiaries or (ii) caused the Mortgaged Property or any other real property owned, leased or operated by Holdings or any of the Subsidiaries to be subject to any restrictions on the ownership, lease, occupancy or transferability of such property under any applicable Environmental Law.

Section 3.07.                             Compliance with Laws and Agreements.  Each of Holdings and each Subsidiary is in compliance with all laws, regulations and orders of any Governmental Authority applicable to it or

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its property and all indentures, agreements and other instruments binding upon it or its property, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.  No Default has occurred and is continuing.

Section 3.08.                             Investment Company Act Status.  Neither Holdings nor any of the Subsidiaries is an “investment company” as defined in, or subject to regulation under, the Investment Company Act of 1940.

Section 3.09.                             Taxes.  Each of Holdings and each Subsidiary has timely filed or caused to be filed all Tax returns and reports required to have been filed and has paid or caused to be paid all Taxes required to have been paid by it, except (a) Taxes that are being contested in good faith by appropriate proceedings and for which Holdings or such Subsidiary, as applicable, has set aside on its books adequate reserves or (b) to the extent that the failure to do so could not reasonably be expected to result in a Material Adverse Effect.

Section 3.10.                             ERISA.  No ERISA Event has occurred or is reasonably expected to occur that, when taken together with all other such ERISA Events for which liability is reasonably expected to occur, could reasonably be expected to result in a Material Adverse Effect.  The present value of all accumulated benefit obligations under each Plan (based on the assumptions used for purposes of Statement of Financial Accounting Standards No. 87) did not, as of the date of the most recent financial statements reflecting such amounts, exceed by more than $1,000,000 the fair market value of the assets of such Plan, and the present value of all accumulated benefit obligations of all underfunded Plans (based on the assumptions used for purposes of Statement of Financial Accounting Standards No. 87) did not, as of the date of the most recent financial statements reflecting such amounts, exceed by more than $1,000,000 the fair market value of the assets of all such underfunded Plans.

Section 3.11.                             Disclosure.  Neither the Information Memorandum nor any of the other reports, financial statements, certificates or other information furnished by or on behalf of any Loan Party to the Administrative Agent or any Lender in connection with the negotiation of this Agreement or any other Loan Document or delivered hereunder or thereunder (as modified or supplemented by other information so furnished and taken as a whole) contains any material misstatement of fact or omits to state any material fact necessary to make the statements therein taken as a whole, in the light of the circumstances under which they were made, not misleading; provided that, with respect to projected financial information, Holdings and the Borrower represent only that such information was prepared in good faith based upon assumptions believed to be reasonable at the time (it being understood that such projections may vary from actual results and such variances may be material).

Section 3.12.                             Capitalization; Subsidiaries.