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<SEC-DOCUMENT>0001001614-06-000035.txt : 20060705
<SEC-HEADER>0001001614-06-000035.hdr.sgml : 20060704
<ACCEPTANCE-DATETIME>20060705152446
ACCESSION NUMBER:		0001001614-06-000035
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		3
CONFORMED PERIOD OF REPORT:	20060630
ITEM INFORMATION:		Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant
FILED AS OF DATE:		20060705
DATE AS OF CHANGE:		20060705

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			TENGASCO INC
		CENTRAL INDEX KEY:			0001001614
		STANDARD INDUSTRIAL CLASSIFICATION:	CRUDE PETROLEUM & NATURAL GAS [1311]
		IRS NUMBER:				870267438
		STATE OF INCORPORATION:			TN
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-15555
		FILM NUMBER:		06943752

	BUSINESS ADDRESS:	
		STREET 1:		10215 TECHNOLOGY DRIVE
		STREET 2:		SUITE 301
		CITY:			KNOXVILLE
		STATE:			TN
		ZIP:			37932
		BUSINESS PHONE:		865-675-1554

	MAIL ADDRESS:	
		STREET 1:		10215 TECHNOLOGY DRIVE
		STREET 2:		SUITE 301
		CITY:			KNOXVILLE
		STATE:			TN
		ZIP:			37932
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>eightk_50mill.htm
<DESCRIPTION>8-K
<TEXT>
<HTML>
<HEAD>
<TITLE></TITLE>
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<BODY>
<!-- MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation" -->
<A NAME=A001></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>UNITED STATES </FONT></H1>

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<A NAME=A002></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>SECURITIES and
EXCHANGE COMMISSION </FONT></H1>

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<A NAME=A003></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>WASHINGTON, D.C. 20549 </FONT></H1>

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<A NAME=A004></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>FORM 8-K </FONT></H1>

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<A NAME=A005></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Current Report Pursuant
to Section 13 or 15(d) of the </FONT></H1>

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<A NAME=A006></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Securities Exchange
Act of 1934 </FONT></H1>

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<A NAME=A007></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Date of Report (Date
of Earliest Event Reported): </FONT></H1>

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<A NAME=A008></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>June 29, 2006 </FONT></H1>

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<A NAME=A009></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>Tengasco, Inc. </U></FONT></P>

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<A NAME=A010></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(Exact Name of
Registrant as specified in its charter) </FONT></P>

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<A NAME=A011></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Commission File Number
0-20975 </FONT></P>




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<TR VALIGN="BOTTOM">
     <TH><u>Tennessee</u> </TH>
     <TH></TH>
     <TH>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp; &nbsp;&nbsp;  <u> 87-0267438</u></TH></TR>
<TR VALIGN="TOP">
     <TD>(State or other jurisdiction of<br>incorporation or organization)  </TD>
     <TD> </TD>
     <TD>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp; &nbsp;&nbsp;(I.R.S. Employer Identification No.)</TD></TR>
<TR VALIGN="TOP">
     <TD></TD>
     <TD></TD>
     <TD></TD></TR>
<TR VALIGN="TOP">
     <TD></TD>
     <TD></TD>
     <TD></TD></TR>
</TABLE>


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<A NAME=A012></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I>&nbsp;&nbsp;&nbsp;</I></FONT></P>





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<A NAME=A013></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>10215 Technology
Drive N.W., Suite 301, Knoxville, Tennessee 37932 </U></FONT></P>

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<A NAME=A014></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(Address of Principal
Executive Office </FONT></P>

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<A NAME=A015></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>(865) 675-1554 </U></FONT></P>

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<A NAME=A016></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(Registrant&#146;s
Telephone number) </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Check the appropriate box below if
the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the
registrant under any of the following provisions (see General Instruction A.2. below): [ ]
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ]
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ]
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c)) </FONT></P>

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<A NAME=A017></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Item 1.01 Entry into a
Material Definitive Agreement. </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On June
29, 2006, Tengasco, Inc. (the &#147;Company&#148;) entered into a $50,000,000 revolving
senior credit facility with Citibank Texas, N.A. in its own capacity and also as agent for
other banks. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Under
the facility, loans and letters of credit will be available to the Company on a revolving
basis in an amount outstanding not to exceed the lesser of $50,000,000 or the borrowing
base in effect from time to time. The Company&#146;s initial borrowing base was set at
$2,600,000. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
initial loan under the facility with Citibank closed on June 29, 2006 in the principal
amount of $2.6 million, bearing interest at a floating rate equal to LIBOR plus 2.5%,
resulting in a current rate of interest of approximately 8.2%. Interest only is payable
during the term of the loan and the principal balance of the loan is due thirty-six months
from closing. The facility is secured by a lien on substantially all of the Company&#146;s
producing and non-producing oil and gas properties and pipeline assets. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;$1.393
million of the $2.6 million loan proceeds was used by the Company on June 29, 2006 to
exercise its option to repurchase from Hoactzin Partners, L.P. (&#147;Hoactzin&#148;) the
Company&#146;s obligation to drill the final six wells of the Company&#146;s twelve-well
Kansas drilling program (the &#147;Twelve Well Program&#148;). The Company had previously
accepted an exchange from Hoactzin of promissory notes made by the Company in the
principal amount of $2,514,000 for a 94.3% working interest in the Twelve Well Program.
The Company retained the remaining 5.7% working interest in the Twelve Well Program. The
promissory notes exchanged were originally issued by the Company in connection with loans
made to the Company by Dolphin Offshore Partners, L.P. (&#147;Dolphin&#148;) to fund the
Company&#146;s cash exchange to holders of its Series A, B and C Preferred Stock as part
of its offer to eliminate its preferred stockholders. Peter E. Salas, the Chairman of the
Board of Directors of the Company, is the controlling person of Hoactzin. He is also the
sole shareholder and controlling person of Dolphin Management, Inc., the general partner
of Dolphin, which is the Company&#146;s largest shareholder. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
a result of the repurchase, the Twelve Well Program has now been converted to a six well
program and Hoactzin will continue to receive production from those six wells in
accordance with the payment terms of the drilling program plus an additional 6.25%
overriding royalty in those six wells. If the Company did not exercise its repurchase
option, Hoactzin would have received a 94% working interest in the final six wells of the
program. Instead, it will receive only a 6.25% overriding royalty in six Company wells to
be drilled. Since the Company&#146;s prior eight-well program drilling obligations were
also satisfied earlier in 2006, the Company as of June 30, 2006 has no obligation to drill
any additional wells for any parties other than the Company itself. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
balance of the $2.6 million loan will be used by the Company for lease acquisition and
three dimensional seismic shoots and analysis for oil exploration on a large tract in
Kansas. </FONT></P>


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<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Item 2.02.  Results of Operations and Financial Condition. </FONT></H1>










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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
July 5, 2006, Tengasco, Inc. issued a press release which, among other things, discloses
the Company&#146;s record level oil production in Kansas for the month of June, 2006 and
the second quarter ended June 30, 2006. The full text of the press release issued in
connection with the announcement is furnished as Exhibit 99.1 to this Current Report on
Form 8-K. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
information in this Form 8-K (including Exhibit 99.1) shall not be deemed
&#147;filed&#148; for purposes of Section 18 of the Securities Exchange Act of 1934 (the
&#147;Exchange Act&#148;) or otherwise subject to the liabilities of that section, nor
shall it be deemed incorporated by reference in any filing under the Securities Act of
1933 or the Exchange Act, except as expressly set forth by specific reference in such a
filing. </FONT></P>


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<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet  Arrangement of a Registrant.</FONT></H1>






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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
information set forth under Item 1.01 &#147;Entry into a Material Definitive
Agreement&#148; above is incorporated herein by reference. </FONT></P>

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<A NAME=A018></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Item 9.01 Financial
Statements and Exhibits </FONT></H1>

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<A NAME=A019></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c) Exhibits<br>10.1     Loan and Security Agreement dated as of June 29, 2006 between Tengasco, Inc. and Citibank Texas, N.A. </FONT></P>



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<A NAME=A020></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>99.1 Press Release dated
July 5, 2006 </FONT></P>

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<A NAME=A021></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>SIGNATURES </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant
to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly
caused and authorized this report to be signed on its behalf by the undersigned. </FONT></P>

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<A NAME=A022></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Dated: July 5, 2006 </FONT></P>

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<A NAME=A023></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tengasco,
Inc.</FONT></P>









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     <TH></TH>
     <TH></TH>
     <TH></TH></TR>
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     <TD>By: <u>s/Jeffrey R. Bailey</u><br>Jeffrey
R. Bailey, <BR>Chief Executive Officer</TD>
     <TD></TD>
     <TD></TD></TR>
<TR VALIGN="TOP">
     <TD></TD>
     <TD></TD>
     <TD></TD></TR>
<TR VALIGN="TOP">
     <TD></TD>
     <TD></TD>
     <TD></TD></TR>
</TABLE>

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</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>2
<FILENAME>loan_agreement.htm
<DESCRIPTION>EXHIBIT 10.01
<TEXT>
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<TITLE></TITLE>
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<!-- MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation" -->
<A NAME=A001></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>LOAN AND SECURITY
AGREEMENT </FONT></H1>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold 1-TNR" FSL="Workstation" -->
<A NAME=A002></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Dated as of </FONT></H1>

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<A NAME=A003></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>June 29, 2006 </FONT></H1>

<!-- MARKER FORMAT-SHEET="Head Minor Center-TNR" FSL="Workstation" -->
<A NAME=A004></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>by and among </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation" -->
<A NAME=A005></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>TENGASCO, INC., </FONT></H1>

<!-- MARKER FORMAT-SHEET="Head Minor Center-TNR" FSL="Workstation" -->
<A NAME=A006></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>a Tennessee corporation, </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Minor Center-TNR" FSL="Workstation" -->
<A NAME=A007></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>as the
&#147;Borrower&#148;, </FONT></P>

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<A NAME=A008></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>CITIBANK TEXAS, N.A., </FONT></H1>

<!-- MARKER FORMAT-SHEET="Head Minor Center-TNR" FSL="Workstation" -->
<A NAME=A009></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>a national banking
association </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Minor Center-TNR" FSL="Workstation" -->
<A NAME=A010></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>as the &#147;Agent&#148; </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Minor Center-TNR" FSL="Workstation" -->
<A NAME=A011></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>and </FONT></P>

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<A NAME=A012></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>the Banks party hereto </FONT></P>


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<A NAME=A013></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>TABLE OF CONTENTS, Page
iii </FONT></P>

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<A NAME=A014></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>DALLAS1 1099496v4
67682-00024 </FONT></P>

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<A NAME=A015></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>Table of Contents </U></FONT></P>

<!-- MARKER FORMAT-SHEET="Head Right-TNR" FSL="Default" -->
<A NAME=A016></A>
<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Page No. </FONT></P>

<p style=' margin-bottom:12pt; margin-top:0pt;text-align:center;'><u><font size=2>Table of Contents</font></u></p>


<table border="0" cellspacing=0 cellpadding=0 width="645" style='border-collapse:collapse'>
    <tr >
        <td  nowrap colspan="4" valign=top style='padding:0in 0in 12.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:12pt'><font size=1>&nbsp;</font></p> </td>
        <td  nowrap colspan="3" valign=top style='padding:0in 0in 12.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0in'><u><font size=2>Page No.</font></u></p> </td>
        <td  width="1">
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:12pt'><font size=1>&nbsp;</font></td> </tr>
    <tr >
        <td  nowrap colspan="3" valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>ARTICLE I</font></p> </td>
        <td  nowrap colspan="3" valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>CERTAIN DEFINITIONS</font></p> </td>
        <td width="27" nowrap valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>1</font></p> </td>
        <td  width="1">
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:12pt'><font size=1>&nbsp;</font></td> </tr>
    <tr >
        <td  nowrap colspan="3" valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>ARTICLE II</font></p> </td>
        <td  nowrap colspan="2" valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>LOANS</font></p> </td>
        <td  nowrap colspan="3" valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>11</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>2.1</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Revolver Loans</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>11</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>2.2</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Notes</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>11</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>2.3</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Proceeds of Loans/Expiration of Commitment.</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>2.4</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Responsible Officer</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>2.5</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Revolving Credit Borrowing Base</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>2.6</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Variance from Revolving Credit Borrowing Base</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>2.7</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Mandatory Prepayments</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>13</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>2.8</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Fees.</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>13</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>2.9</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Interest Rates.</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>13</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>2.10</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Prepayments</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>13</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>2.11</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Interest Payments Dates</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>14</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>2.12</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Payments; Settlement.</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>14</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>2.13</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Letters of Credit.</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>14</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>2.14</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Increased Costs</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>16</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>2.15</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Capital Adequacy</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>16</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>2.16</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Pro Rata Treatment</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>17</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>2.17</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Sharing of Payments, etc</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>17</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>2.18</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Non-Receipt of Funds by the Agent</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>17</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>2.19</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Breakage Costs</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>17</font></p> </td> </tr>
    <tr >
        <td  nowrap colspan="3" valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>ARTICLE III</font></p> </td>
        <td  nowrap colspan="2" valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>REVOLVING CREDIT BORROWING BASE</font></p> </td>
        <td  nowrap colspan="3" valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>18</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>3.1</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Initial Revolving Credit Borrowing Base</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>18</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>3.2</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Revolving Credit Borrowing Base Determination.</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>18</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>3.3</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Revolving Credit Borrowing Base Deficiency</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>19</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>3.4</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Additional Redeterminations.</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>20</font></p> </td> </tr>
    <tr >
        <td  nowrap colspan="3" valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>ARTICLE IV</font></p> </td>
        <td  nowrap colspan="2" valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>COLLATERAL</font></p> </td>
        <td  nowrap colspan="3" valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>20</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>4.1</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Collateral</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>20</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>4.2</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Additional Mortgaged Properties</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>20</font></p> </td> </tr>
    <tr >
        <td  nowrap colspan="3" valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>ARTICLE V</font></p> </td>
        <td  nowrap colspan="2" valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>CONDITIONS PRECEDENT TO LOANS</font></p> </td>
        <td  nowrap colspan="3" valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>21</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>5.1</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Conditions Precedent to Closing and Funding of Commitment</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>21</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>5.2</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Credit Extensions</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>23</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>5.3</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Conditions Precedent to All Revolving Credit Loans</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>23</font></p> </td> </tr>
    <tr >
        <td  nowrap colspan="3" valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>ARTICLE VI</font></p> </td>
        <td  nowrap colspan="2" valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>AFFIRMATIVE COVENANTS</font></p> </td>
        <td  nowrap colspan="3" valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>23</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>6.1</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Payment of Taxes and Claims</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>24</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>6.2</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Maintenance of Existence</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>24</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>6.3</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Preservation of Property</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>24</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>6.4</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Insurance</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>24</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>6.5</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Compliance with Applicable Laws</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>24</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>6.6</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Environmental Covenants</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>24</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>6.7</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Environmental Indemnities</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>25</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>6.8</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Reporting Requirements</font></p> </td>
        <td  nowrap colspan="3" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>26</font></p> </td> </tr>
    <tr>
        <td width="48" ></td>

        <td width="48" ></td>

        <td width="8" ></td>

        <td width="465" ></td>

        <td width="41" ></td>

        <td width="7" ></td>

        <td width="27" ></td>

        <td width="1" ></td> </tr> </table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>TABLE OF CONTENTS, Page i</font></p>

<p style=' margin-bottom:12pt; margin-top:0pt;text-align:justify;'><font size=1>DALLAS1 1099496v4 67682-00024</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style='page-break-before:always'></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>


<table border="0" cellspacing=0 cellpadding=0 width="645" style='border-collapse:collapse'>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>6.9</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Inspection</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>28</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>6.10</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Maintenance of Employee Benefit Plans</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>28</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>6.11</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Notice of Claimed Default</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>28</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>6.12</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Change of Directors/Management</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>28</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>6.13</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Requested Information</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>28</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>6.14</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Withholdings</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>28</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>6.15</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Payment of Indebtedness/Performance of Obligations</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>28</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>6.16</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Operation of Properties and Equipment.</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>29</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>6.17</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Hydrocarbon Hedge</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>29</font></p> </td> </tr>
    <tr >
        <td  nowrap colspan="3" valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>ARTICLE VII</font></p> </td>
        <td width="507" nowrap valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>NEGATIVE COVENANTS</font></p> </td>
        <td width="35" nowrap valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>29</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>7.1</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Liens</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>29</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>7.2</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Debt</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>30</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>7.3</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Mergers, Consolidations</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>30</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>7.4</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Leases</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>30</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>7.5</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Sale and Leaseback</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>30</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>7.6</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Dividends/Distributions</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>31</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>7.7</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Sale of Assets</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>31</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>7.8</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Investments</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>31</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>7.9</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Guaranties</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>31</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>7.10</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Transactions with Affiliates</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>31</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>7.11</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Change of Business</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>31</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>7.12</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Sale or Discount of Receivables</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>32</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>7.13</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Other Agreements/Amendments</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>32</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>7.14</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Prepayment of Indebtedness</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>32</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>7.15</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Use of Loan Proceeds</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>32</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>7.16</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Subsidiaries</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>32</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>7.17</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Fiscal Year</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>32</font></p> </td> </tr>
    <tr >
        <td  nowrap colspan="3" valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>ARTICLE VIII</font></p> </td>
        <td width="507" nowrap valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>FINANCIAL COVENANTS</font></p> </td>
        <td width="35" nowrap valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>32</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>8.1</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Current Ratio</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>32</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>8.2</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Leverage Ratio</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>32</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>8.3</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Interest Coverage Ratio</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>33</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>8.4</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>General and Administrative Expenses</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>33</font></p> </td> </tr>
    <tr >
        <td  nowrap colspan="3" valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>ARTICLE IX</font></p> </td>
        <td width="507" nowrap valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>REPRESENTATIONS AND WARRANTIES</font></p> </td>
        <td width="35" nowrap valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>33</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>9.1</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Good Standing, and Due Qualification</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>33</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>9.2</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Litigation</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>33</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>9.3</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Conflicting Agreements and Other Matters</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>33</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>9.4</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Financial Statements/Condition</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>34</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>9.5</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Title to Properties, Authority</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>34</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>9.6</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Environment</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>34</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>9.7</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Purposes</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>35</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>9.8</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Compliance with Applicable Laws</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>35</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>9.9</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Possession of Franchises, Licenses</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>35</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>9.10</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Leases, Easements and Rights of Way</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>35</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>9.11</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Taxes</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>35</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>9.12</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Intentionally Omitted</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>35</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>9.13</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>ERISA</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>35</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>9.14</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Tax Related Liens</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>35</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>9.15</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Corporate Authorization</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>36</font></p> </td> </tr>
    <tr>
        <td width="48" ></td>

        <td width="48" ></td>

        <td width="8" ></td>

        <td width="507" ></td>

        <td width="35" ></td> </tr> </table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>TABLE OF CONTENTS, Page ii</font></p>

<p style=' margin-bottom:12pt; margin-top:0pt;text-align:justify;'><font size=1>DALLAS1 1099496v4 67682-00024</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style='page-break-before:always'></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>


<table border="0" cellspacing=0 cellpadding=0 width="645" style='border-collapse:collapse'>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>9.16</font></p> </td>
        <td width="515" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Investment Company Act Representation</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>36</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>9.17</font></p> </td>
        <td width="515" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Production Sales Contracts</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>36</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>9.18</font></p> </td>
        <td width="515" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Take or Pay Obligations, Prepayments, BTU Adjustments and Balancing Problem</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>36</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>9.19</font></p> </td>
        <td width="515" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Gas Purchase Obligations in Excess of Gas Sales Rights</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>36</font></p> </td> </tr></table>



<table border="0" cellspacing=0 cellpadding=0 width="100%" style='border-collapse:collapse'>
    <tr >
        <td width="48" valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0in'><font size=2>9.20</font></p> </td>
        <td  valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Public Utility Holding Company Act, Federal Power Act, Interstate Commerce Act; Other Regulation&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;36</font></p> </td> </tr></table>



<table border="0" cellspacing=0 cellpadding=0 width="645" style='border-collapse:collapse'>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>9.21</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>No Material Misstatements</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>37</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>9.22</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Location of Business and Offices</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>37</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>9.23</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Solvency</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>37</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>9.24</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Risk Management Agreement</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>37</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>9.25</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Subsidiaries</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>37</font></p> </td> </tr>
    <tr >
        <td  nowrap colspan="3" valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>ARTICLE X</font></p> </td>
        <td width="507" nowrap valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>EVENTS OF DEFAULT</font></p> </td>
        <td width="35" nowrap valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>37</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>10.1</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Events of Default</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>37</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>10.2</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Remedies</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>39</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>10.3</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Actions in Respect of the Letters of Credit Upon Default</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>39</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>10.4</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Application of Proceeds</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>40</font></p> </td> </tr>
    <tr >
        <td  nowrap colspan="3" valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>ARTICLE XI</font></p> </td>
        <td width="507" nowrap valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>AGENCY PROVISIONS</font></p> </td>
        <td width="35" nowrap valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>40</font></p> </td> </tr>
    <tr >
        <td  nowrap colspan="3" valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>ARTICLE XII</font></p> </td>
        <td width="507" nowrap valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>MISCELLANEOUS</font></p> </td>
        <td width="35" nowrap valign=top style='padding:6.0pt 0in 6.0pt 0in; '>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>42</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12.1</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Notices</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>42</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12.2</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Place of Payment</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>42</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12.3</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Survival of Agreements</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>42</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12.4</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Parties in Interest</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>42</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12.5</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Governing Law</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>43</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12.6</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>SUBMISSION TO JURISDICTION</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>43</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12.7</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Interest</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>43</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12.8</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>No Waiver, Cumulative Remedies</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>44</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12.9</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Costs</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>44</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12.10</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>INDEMNITIES, ETC.</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>44</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12.11</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Right of Setoff</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>45</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12.12</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Headings</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>46</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12.13</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Severability</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>46</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12.14</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Exceptions to Covenants</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>46</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12.15</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Conflict with Security Instruments</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>46</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12.16</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Confidentiality</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>46</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12.17</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Survival</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>46</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12.18</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>NO ORAL AGREEMENTS</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>47</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12.19</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font SIZE=2>WAIVER OF JURY</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>47</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12.20</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Counterparts</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>47</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12.21</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Amendments</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>47</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12.22</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>No Liability of the Letter of Credit Issuer</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>48</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12.23</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>Successors and Assigns.</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>48</font></p> </td> </tr>
    <tr >
        <td width="48" nowrap valign=top >
            <p  style='margin-left:0in;text-indent:0in'><font size=1>&nbsp;</font></p> </td>
        <td width="48" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>12.24</font></p> </td>
        <td  nowrap colspan="2" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>USA Patriot Act Notice</font></p> </td>
        <td width="35" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0in'><font size=2>50</font></p> </td> </tr>
    <tr>
        <td width="48" ></td>

        <td width="48" ></td>

        <td width="8" ></td>

        <td width="507" ></td>

        <td width="35" ></td> </tr> </table>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>TABLE OF CONTENTS, Page iii</font></p>

<p style=' margin-bottom:12pt; margin-top:0pt;text-align:justify;'><font size=1>DALLAS1 1099496v4 67682-00024</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style='page-break-before:always'></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>


<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2></font></p>

<p style=' margin-bottom:12pt; margin-top:0pt;text-align:justify;'><font size=1></font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>


<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>







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<HR SIZE=5 COLOR=GRAY NOSHADE>



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<A NAME=A017></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>LOAN AND SECURITY AGREEMENT,
 </FONT></P>

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<A NAME=A018></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>DALLAS1 1099496v4
67682-00024 </FONT></P>

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<A NAME=A019></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>LOAN AND SECURITY
AGREEMENT </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;THIS
LOAN AND SECURITY AGREEMENT, dated as of June 29, 2006 (this &#147;<U>Agreement</U>&#148;)
is made and entered into by and among TENGASCO, INC., a Tennessee corporation (the
&#147;<U>Borrower</U>&#148;), CITIBANK TEXAS, N.A., a national banking association, as the
Agent (the &#147;<U>Agent</U>&#148;), and the financial institutions party thereto (the
&#147;<U>Banks</U>&#148;). </FONT></P>

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<A NAME=A020></A>
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>WITNESSETH: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS,
the Banks party hereto are willing to extend a Line of Credit to the Borrower upon the
terms and conditions herein set forth and upon the Borrower&#146;s granting in favor of
the Agent, for the benefit of the Banks, a&nbsp;continuing and continuous first and prior
lien, pledge of and security interest in certain of the Borrower&#146;s oil and gas
leasehold mineral interests and other mineral interests situated in the States of Kansas
and Tennessee, all as more particularly described and defined in the Mortgages, as
collateral and security for all Indebtedness; and </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS,
the Borrower, the Banks and the Agent now desire to enter into this Agreement ; </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NOW,
THEREFORE, in consideration of the mutual covenants and agreements contained herein, and
other good and valuable consideration, receipt of which is acknowledged by the parties
hereto, the parties agree as follows: </FONT></P>

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<A NAME=A021></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE I  </FONT></H1>

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<A NAME=A022></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>CERTAIN DEFINITIONS </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;When
used herein, the following terms shall have the following meanings: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.1 <U>Adjusted Net Income</U> shall
mean, for any period, the Borrower&#146;s and its Subsidiaries&#146; consolidated net
income (or loss) determined in accordance with Consistent Accounting Principles, but
excluding (a)&nbsp;the income of any Person other than the Borrower or its Subsidiaries in
which the Borrower or any of its Subsidiaries has an ownership interest, unless received
by the Borrower or its Subsidiary in a cash distribution; (b)&nbsp;any after-tax gains or
losses attributable to an asset disposition; (c)&nbsp;to the extent not included in
<U>clause (a)</U> and <U>clause&nbsp;(b) </U>above, any after-tax extraordinary, non-cash
or nonrecurring gains or losses; and (d) any DD&amp;A charges. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.2 <U>Affiliate</U> shall mean any
Person which, directly or indirectly, controls, or is controlled by, or is under common
control with, another Person and any partner, officer or employee of any such Persons,
except a Subsidiary. For purposes of this definition, control shall mean the power,
directly or indirectly, to direct or in effect cause the direction of the management and
policies of such Person whether by contract or otherwise. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.3 <U>Applicable Prime Rate</U>
shall mean the Prime Rate published by The Wall Street Journal (Southwest Edition) in its
Money Rates column or a similar rate if such rate ceases to be published. Any change in
the Applicable Prime Rate shall be effective as of the date of the change. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.4 <U>Approved Engineer</U> shall
mean LaRoche Engineering or such other independent oil and gas registered engineer or
engineering firm selected by the Borrower and approved by the Agent. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.5 <U>Applicable Margin</U> shall
mean, for any day with respect to any Revolver Loan or with respect to the commitment fees
payable hereunder, as the case may be, the Applicable Margin per annum set forth below
under the caption &#147;Applicable Prime Rate&#148;, &#147;Libor Rate&#148; or
&#147;Commitment Fee Rate&#148;, as the case may be, based upon the Borrowing Base Usage
as of such determination date. </FONT></P>



<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=760>
<TR VALIGN=Bottom>
     <TH COLSPAN=2>Category<HR WIDTH=95% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2>Borrowing Base Usage<HR WIDTH=95% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2>Applicable Prime Rate <HR WIDTH=95% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2>Libor Rate<HR WIDTH=95% SIZE=1 COLOR=BLACK NOSHADE></TH>
     <TH COLSPAN=2>Commitment Fee<BR>
Rate<HR WIDTH=95% SIZE=1 COLOR=BLACK NOSHADE></TH></TR>
<TR VALIGN=Bottom>
     <TH COLSPAN=2></TH>
     <TH COLSPAN=2></TH>
     <TH COLSPAN=2></TH>
     <TH COLSPAN=2></TH>
     <TH COLSPAN=2></TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=47% ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1</TD>
     <TD WIDTH=2% ALIGN=LEFT>&nbsp;</TD>
     <TD WIDTH=30% ALIGN=LEFT>Greater than or equal to 90%</TD>
     <TD WIDTH=2% ALIGN=LEFT>&nbsp;</TD>
     <TD WIDTH=3% ALIGN=RIGHT>1</TD>
        <TD WIDTH=3% ALIGN=LEFT>.50%</TD>
     <TD WIDTH=4% ALIGN=RIGHT>2</TD>
        <TD WIDTH=3% ALIGN=LEFT>.50%</TD>
     <TD WIDTH=4% ALIGN=RIGHT>0</TD>
        <TD WIDTH=2% ALIGN=LEFT>.50%</TD></TR>

<TR VALIGN=Bottom>
     <TD ALIGN=LEFT></TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=LEFT>&nbsp;</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>1</TD>
        <TD ALIGN=LEFT>.25%</TD>
     <TD ALIGN=RIGHT>2</TD>
        <TD ALIGN=LEFT>.25%</TD>
     <TD ALIGN=RIGHT>0</TD>
        <TD ALIGN=LEFT>.50%</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=LEFT>Greater  than or equal to 75% but less than 90%</TD><TD ALIGN=LEFT>&nbsp;</TD></TR>

<TR VALIGN=Bottom>
     <TD ALIGN=LEFT></TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=LEFT>&nbsp;</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>1</TD>
        <TD ALIGN=LEFT>.00%</TD>
     <TD ALIGN=RIGHT>2</TD>
        <TD ALIGN=LEFT>.00%</TD>
     <TD ALIGN=RIGHT>0</TD>
        <TD ALIGN=LEFT>.375%</TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=LEFT> Greater  than or equal to 50% but less than 75%</TD><TD ALIGN=LEFT>&nbsp;</TD></TR>

<TR VALIGN=Bottom>
     <TD ALIGN=LEFT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=LEFT>Less than 50%</TD><TD ALIGN=LEFT>&nbsp;</TD>
     <TD ALIGN=RIGHT>0</TD>
        <TD ALIGN=LEFT>.75%</TD>
     <TD ALIGN=RIGHT>1</TD>
        <TD ALIGN=LEFT>.75%</TD>
     <TD ALIGN=RIGHT>0</TD>
        <TD ALIGN=LEFT>.375%</TD></TR>

</TABLE>


<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" --><P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
1.6 &nbsp;&nbsp; &nbsp;Borrowing Base Deficiency shall have the meaning assigned to that term in Section 3.3.</FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.7 <U>Borrowing Base Usage</U> shall
mean (a) the sum of (i) the outstanding Revolver Loans and all accrued but unpaid interest
and fees plus (ii) the L/C Exposure divided by (b) the Borrowing Base then in effect. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.8 <U>Business Day</U> shall mean a
day other than a Saturday, Sunday or a day upon which banks in the State of Texas are
closed to business generally; provided that when used in connection with a Libor Loan, the
term shall also exclude any day on which banks are not open for dealings in dollar
deposits in the London interbank market. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.9 <U>CERCLA</U> shall mean the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended,
together with all regulations and rulings promulgated with respect thereto. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.10 <U>Change in Control</U> shall
mean (a)&nbsp;the failure of Jeff Bailey to hold the office of Chief Executive Officer of
the Borrower or (b)&nbsp;the occupation of a majority of the seats (other than vacant
seats) on the board of directors or similar governing body of the Borrower by Persons
other than the members of such board or body as of the date hereof. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.11 <U>Closing Date</U> shall mean
the date on which the conditions set forth in <U>Article V</U> have all been met to the
satisfaction of the Agent. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.12 <U>Code</U> shall mean the
Internal Revenue Code of 1986, as amended from time to time and any successor statute. </FONT></P>

1.13     Collateral shall have the meaning assigned to that term in Article IV.

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.14 <U>Commitment</U> shall mean (a)
with respect to each Bank, its agreement at any time to make Revolver Loan advances and to
issue the Letters of Credit under this Agreement up to the lesser of: (i) such Bank&#146;s
Pro Rata Portion of then effective Revolving Credit Borrowing Base, subject to the
redeterminations of the Revolving Credit Borrowing Base, and other limitations and
conditions hereof (including, without limitation, the conditions precedent in <U>Article
V</U> hereof) or (ii) such Bank&#146;s Pro Rata Portion of the Commitment Amount, and (b)
with respect to all Banks, the agreement of the Banks at any time to make Revolver Loan
advances and to issue the Letters of Credit under this Agreement up to the lesser of (i)
then effective Revolving Credit Borrowing Base, subject to the redeterminations of the
Revolving Credit Borrowing Base, and other limitations and conditions hereof (including,
without limitation, the conditions precedent in <U>Article V</U> hereof) or (ii) the
Commitment Amount. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.15 <U>Commitment Amount</U>
initially shall mean $2,600,000 or such other amount as agreed to in writing by the
Borrower, the Banks and the Agent but in no event in excess of the lesser of $50,000,000
or the Revolving Credit Borrowing Base, as adjusted and redetermined from time to time
pursuant to the provisions of <U>Article III</U>. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.16 <U>Commitment Fee</U> shall mean
the fee payable to the Agent for the account of the Banks by the Borrower pursuant to the
provisions of <U>Section&nbsp;2.8</U>. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.17 <U>Compliance Certificate</U>
shall mean a certificate completed by the Borrower substantially in the form of the
certificate attached hereto as <U>Exhibit B</U>. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.18 <U>Consistent Accounting
Principles</U> shall mean commonly recognized accounting principles consistently applied
in all accounting periods. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.19 <U>Consolidated Current
Assets</U> shall mean, on any date, the aggregate amount of all assets of the Borrower and
its Subsidiaries, determined on a consolidated basis that would be classified as current
assets at such date in accordance with Consistent Accounting Principles. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.20 <U>Consolidated Current
Liabilities</U> shall mean, on any date, the aggregate amount of all assets of the
Borrower and its Subsidiaries, determined on a consolidated basis that would be classified
as current liabilities at such date in accordance with Consistent Accounting Principles;
provided, however, that the Revolver Loans will not be included in the calculation of
Consolidated Current Liabilities. </FONT></P>

1.21     Debt of any Person shall mean, without duplication:

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          All indebtedness of such Person for borrowed money; </FONT></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Lv 0-TNR" FSL="Workstation" -->
     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          All obligations of such Person for the deferred purchase price of property or
          services; </FONT></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Lv 0-TNR" FSL="Workstation" -->
     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          All obligations of such Person evidenced by notes, bonds, debentures or other
          similar instruments; </FONT></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Lv 0-TNR" FSL="Workstation" -->
     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(d)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          All obligations of such Person created or arising under any conditional sale or
          other title retention agreement with respect to property acquired by such Person
          (even though the rights and remedies of the seller or lender under such
          agreement in the event of default are limited to repossession and sale of such
          property); </FONT></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Lv 0-TNR" FSL="Workstation" -->
     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(e)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          All capitalized lease obligations; </FONT></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Lv 0-TNR" FSL="Workstation" -->
     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(f)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          All obligations, contingent or otherwise, of such Person under bankers
          acceptance, letter of credit or similar facilities; </FONT></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Lv 0-TNR" FSL="Workstation" -->
     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(g)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          All obligations of such Person to purchase, redeem, retire, defease or otherwise
          make any payment in respect of (i) any capital stock of or other ownership or
          profit interest in such Person or any other Person; or (ii) any warrants, rights
          or options to acquire such capital stock; </FONT></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Lv 0-TNR" FSL="Workstation" -->
     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(h)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          All obligations of such Person in respect of any Risk Management Agreement
          (including Hedge Agreements and Swaps) or any gas balancing or gas purchase
          obligations as contemplated by <U>Sections 9.18</U> and <U>9.19</U>; </FONT></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Lv 0-TNR" FSL="Workstation" -->
     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(i)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          All Debt of others referred to in clauses (a) through (h) above or clause (j)
          below guaranteed directly or indirectly in any manner by such Person, or in
          effect guaranteed directly or indirectly by such Person through an agreement (1)
          to pay or purchase such Debt or to advance or supply funds for the payment or
          purchase of such Debt; (2) to purchase, sell or lease (as lessee or lessor)
          property, or to purchase or sell services, primarily for the purpose of enabling
          the debtor to make payment of such Debt or to assure the holder of such Debt
          against loss in respect thereof, (3) to supply funds to or in any other manner
          invest in the debtor (including any agreement to pay for property or services
          irrespective of whether such property is received or such services are
          rendered); or (4) otherwise to assure the holder of such Debt against loss in
          respect thereof, and </FONT></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Lv 0-TNR" FSL="Default" -->
     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(j)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          All Debt referred to in clauses (a) through (i) above of another Person secured
          by (or for which the holder of such Debt has an existing right, contingent or
          otherwise, to be secured by) any Lien on property (including, without
          limitation, accounts, contract rights or inventory) owned by such Person, even
          though such Person has not assumed or become liable for the payment of such
          Debt. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

1.22     Default Rate shall mean the Maximum Rate.

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.23 <U>EBITDA</U> shall mean, for
any period, the total of the following calculated for the Borrower and its Subsidiaries on
a consolidated basis for such period (a) Adjusted Net Income; plus (b) income or franchise
taxes actually paid and deducted in determining Adjusted Net Income; plus (c) Interest
Expense deducted in determining Adjusted Net Income plus (d) all amounts attributable to
depreciation and amortization expense deducted in determining Adjusted Net Income plus
(e)&nbsp;any non-cash gains, losses or charges on any Hedge Agreement resulting from the
requirements of SFAS 133 deducted in determining Adjusted Net Income. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.24 <U>Environmental Laws</U> shall
mean Laws, including without limitation federal, state or local Laws, ordinances, rules,
regulations, interpretations and orders of courts or administrative agencies or
authorities relating to pollution or protection of the environment (including, without
limitation, ambient air, surface water, groundwater, land surface and subsurface strata),
including without limitation CERCLA, SARA, RCRA, HSWA, OPA, HMTA, TSCA and other Laws
relating to (i) Polluting Substances or (ii) the manufacture, processing, distribution,
use, treatment, handling, storage, disposal or transportation of Polluting Substances. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.25 <U>ERISA</U> shall mean the
Federal Employee Retirement Income Security Act of 1974, as amended, together with all
regulations and rulings promulgated with respect thereto. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.26 <U>ERISA Event</U> shall mean
(i) a Reportable Event described in Section 4043 of ERISA and the regulations issued
thereunder, (ii) the withdrawal of the Borrower or any ERISA Affiliate from a Plan during
a&nbsp;plan year in which it was a substantial employer as defined in Section 4001 (a)(2)
of ERISA, (iii)&nbsp;the filing of a notice of intent to terminate a Plan or the treatment
of a Plan amendment as a&nbsp;termination under Section 4041 of ERISA, (iv) the
institution of proceedings to terminate a&nbsp;Plan by the PBGC or (v) any over event or
condition which might constitute grounds under Section 4042 of ERISA for the termination
of, or the appointment of a trustee to administer, any Plan. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.27 <U>Event of Default</U> shall
mean any of the events specified in <U>Section 10.1</U>, and Default shall mean any event,
which together with any lapse of time or giving of any notice, or both, would constitute
an Event of Default. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.28 <U>Governmental Authority</U>
shall include the country, the state, county, city and political subdivisions in which any
Person or such Person&#146;s property is located or which exercises valid jurisdiction
over any such Person or such Person&#146;s property, and any Tribunal of any of them
including monetary authorities which exercises valid jurisdiction over any such Person or
such Person&#146;s property. Unless otherwise specified, all references to Governmental
Authority herein shall mean a Governmental Authority having jurisdiction over, where
applicable, the Borrower, any of its Subsidiaries, the Collateral, any of the
Borrower&#146;s or any of its Subsidiaries other properties, the Agent or any Bank. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.29 <U>Governmental Requirement</U>
shall mean any Law, or other directive or requirement (whether or not having the force of
law), including, without limitation, environmental laws, energy regulations and
occupational, safety and health standards or controls, of any Governmental Authority. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.30 <U>Hedge Agreements</U> shall
mean interest rate Swap, cap or collar agreements, interest rate and/or oil and gas future
or option contracts, currency Swap agreements, currency future or option contracts and
other similar agreements. &#147;<U>Hedge Transaction</U>&#148; means a transaction
pursuant to which the Borrower or any of its Subsidiaries hedge the price to be received
by them for future production of its hydrocarbons, including price Swaps under which the
Borrower or its Subsidiaries agree to pay a price for a specified amount of hydrocarbons
determined by reference to a recognized market on a specified future date and the
contracting party agrees to pay such the Borrower or its Subsidiaries a fixed price for
the same or similar amount of hydrocarbons. &#147;<U>Prohibited Hedge
Transactions</U>&#148; shall mean the obligations by the Borrower or any of its
Subsidiaries of any collar or similar transaction by means of which the Borrower is
obligated to such other Person to the transaction for increases in prices in excess of a
fixed ceiling price for such production but only if and to the extent such fixed ceiling
price is below the Revolving Credit Borrowing Base price criteria then being utilized by
the Agent pursuant to its then applicable and current energy lending policies and
procedures. &#147;<U>Bank Hedge Agreement</U>&#148; shall mean a Hedge Agreement entered
into between any Loan Party and any Bank (or any Affiliate of any Bank). &#147;<U>Bank
Hedge Transaction</U>&#148; shall mean a Hedge Transaction between any Loan Party and any
Bank (or any Affiliate of any Bank). </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.31 <U>Hereby</U>, <U>herein</U>,
<U>hereof</U>, <U>hereunder</U> and similar such terms shall mean and refer to this
Agreement as a whole and not merely to the specific section, paragraph or clause in which
the respective word appears. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.32 <U>HMTA</U> shall mean the
Hazardous Materials Transportation Act, as amended, together with all regulations and
rulings promulgated with respect thereto. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.33 <U>HSWA</U> shall mean the
Hazardous and Solid Waste Amendments of 1984, as amended, together with all regulations
and rulings promulgated with respect thereto. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.34 <U>Indebtedness</U> shall mean
any and all: (i) indebtedness, obligations and liabilities of the Borrower (or any
Affiliate or Subsidiary of the Borrower) to the Agent or any Bank (or any Affiliate of any
Bank) incurred or which may be incurred hereafter pursuant to the terms of this Agreement
or any of the other Loan Documents, and any extensions, renewals, substitutions,
amendments and increases in amounts thereof, including such amounts as may be evidenced by
the Notes and all lawful interest thereon, all outstanding and unadvanced Letters of
Credit, all amounts as may be payable under Bank Hedge Agreements or Bank Hedge
Transactions, commitment arrangement fees, amendment fees, redetermination fees (Revolving
Credit Borrowing Base), Letter of Credit issuance and fronting fees, and other charges,
and all reasonable costs and expenses incurred by the Agent or any Bank (or any Affiliate
of any Bank) in connection with the preparation, filing and recording of the Loan
Documents, including attorneys fees; (ii) all reasonable costs and expenses, including
attorneys&#146; fees, paid or incurred by the Agent or any Bank (or any Affiliate of any
Bank) in enforcing or attempting to enforce collection of any Indebtedness and in
enforcing or realizing upon or attempting to enforce or realize upon any collateral or
security for any Indebtedness and in protecting and preserving the Agent&#146;s or any
Bank&#146;s (or any Bank&#146;s Affiliate&#146;s) interest in the Indebtedness or any
collateral or security for any Indebtedness in any bankruptcy or reorganization
proceeding, including interest on all sums so expended by the Bank (or any Affiliate of
Bank) accruing from the date upon which such expenditures are made until paid, at an
annual rate equal to the Default Rate; and (iii) sums expended by the Bank (or any
Affiliate of Bank) in curing any Event of Default or Default of the Borrower (or any
Affiliate or Subsidiary of the Borrower) under the terms of this Agreement, the other Loan
Documents or any other security agreement or other writing evidencing or securing the
payment of the Indebtedness described herein, including the Notes, the Letters of Credit
and Bank Hedge Agreements, together with interest on all sums so expended by the Bank (or
any Affiliate of Bank) accruing from the date upon which such expenditures are made until
paid, at an annual rate equal to the Default Rate. </FONT></P>

1.35     Indemnified Parties shall have the meaning assigned to such term in Section 12.10.

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.36 <U>Indemnity Matters</U> shall
mean any and all actions, suits, proceedings (including any investigations, litigation or
inquiries), claims, demands and causes of action made or threatened against a Person and,
in connection therewith, all losses, liabilities, damages (including, without limitation,
consequential damages) or reasonable costs and expenses of any kind or nature whatsoever
incurred by such Person whether caused by the sole or concurrent negligence of such Person
seeking indemnification. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.37 <U>Initial Commitment</U> shall
mean, for all of the Banks, the obligation to make Revolver Loans up to the lesser of
$2,600,000<B> </B>or the Revolving Credit Borrowing Base and to acquire participations in
the Letters of Credit issued under <U>Section 2.13</U> on the Closing Date. The initial
amount of each Bank&#146;s Commitment is set forth on <U>Schedule&nbsp;1.37</U> hereto. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.38 <U>Interest Expense</U> shall
mean, for any period, the sum of the Borrower&#146;s and its Subsidiaries&#146; (a)
interest expense calculated without duplication on a consolidated basis for such period in
accordance with Consistent Accounting Principles; <U>plus</U> (b) expenses paid under Risk
Management Agreements during such period. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.39 <U>Laws</U> shall mean all
statutes, laws, ordinances, regulations, orders, rules, codes, permits, franchises,
licenses, certificates, writs, injunctions, or decrees of the United States, any state or
commonwealth, any municipality, any foreign country, any territory or possession, or any
Tribunal. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.40 <U>LC Commitment</U> shall mean
a facility sublimit for Letters of Credit Exposure not in excess of twenty percent (20%)
of the Borrowing Base then in effect. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.41 <U>Letters of Credit</U> shall
mean any and all letters of credit now existing or hereafter issued by the Letter of
Credit Issuer pursuant to the request of the Borrower in accordance with the provisions of
<U>Section 2.13.1</U> hereof which at any time remain outstanding and subject to draw by
the beneficiary, whether in whole or in part. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.42 <U>Letter of Credit Exposure</U>
shall mean, at any date, the sum of (a) the aggregate face amount of all drafts that may
then or thereafter be presented by beneficiaries under all Letters of Credit then
outstanding, plus (b)&nbsp;the aggregate face amount of all drafts that the Letter of
Credit Issuer has previously accepted under Letters of Credit but has not paid. </FONT></P>

1.43     Letter of Credit Issuer shall mean,  for any Letter of Credit,  Citibank  Texas,  N.A. and its  successors
and assigns.

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.44 <U>Libor</U> or &#147;<U>Libor
Rate</U>&#148; shall mean, at any time of determination, and subject to availability, the
London Interbank Offered Rate paid in London on one month, three month, or six month
dollar deposits, published by The Wall Street Journal (Southwest Edition) in its Money
Rates column or a similar rate if such rate ceases to be published. Any change in the
Libor Rate shall be effective as of the date of the change. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.45 <U>Libor Loan</U> shall mean the
loans for which the Borrower has elected to use Libor for interest rate computations. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.46 <U>Libor Period</U> shall mean
the Libor for one month, three month, or six month dollar deposits, as selected by the
Borrower. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.47 <U>Lien</U> shall mean any
mortgage, deed of trust, pledge, security interest, encumbrance, lien or charge of any
kind (including any agreement to give any of the foregoing, any conditional sale or other
title retention agreement, any lease in the nature thereof, and the filing of or agreement
to give any financing statement or other similar form of public notice under the Laws of
any jurisdiction). </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.48 <U>Line of Credit</U> shall mean
the lesser of (i) the Commitment Amount established by the Banks in favor of the Borrower
(initially $2,600,000) subject to the Revolving Credit Borrowing Base (including
redeterminations thereof and adjustments thereto) and the other limitations and conditions
of this Agreement or (ii) $50,000,000. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.49 <U>Loan Documents</U> shall
mean, on any date, this Agreement, the Notes, the Security Instruments, Bank Hedge
Agreements, and all other agreements relating to this Agreement entered into from time to
time between the Borrower (or any or all of its Subsidiaries) and the Agent or any Bank
(or any Affiliate of any Bank) and all other documents, letters-in-lieu, instruments,
title reports, title opinions and certificates executed and delivered to the Agent by the
Borrower (or any of its Subsidiaries or Affiliate) in connection with any of the
foregoing, as from time to time amended, supplemented, amended and restated, or otherwise
modified and in effect on such date. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.50 <U>Loan Party</U> shall mean the
Borrower, the Borrower&#146;s domestic Subsidiaries and any other Person who becomes a
party to the Subsidiary Guaranty Agreement. As of the date of this Agreement, the
Borrower, Tennessee Land &amp; Mineral Corporation and Tengasco Pipeline Corporation are
the only Loan Parties. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.51 <U>Material Adverse Effect</U>
shall mean any material and adverse effect on (i) the assets, liabilities, financial
condition, business, operations, prospects or affairs of the Borrower and its Subsidiaries
taken as a whole different from those reflected in the financial statements most recently
delivered pursuant to <U>Sections 6.8.1, 6.8.2</U> or <U>9.4<B></B></U><B> </B>hereof, or
from the facts represented or warranted in this Agreement or any Loan Document, or (ii)
the ability of the Borrower and its Subsidiaries, taken as a whole, to carry out their
business on and after the Closing Date or as proposed as of the Closing Date to be
conducted or meet its obligations under the Loan Documents on a timely basis. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.52 <U>Maturity Date</U> shall mean,
unless a Note is sooner accelerated pursuant to <U>Section 10.2</U> hereof, June 29, 2009. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.53 <U>Maximum Rate</U> shall mean
at any particular in question, the maximum rate of interest which under applicable law may
then be charged. If such maximum rate changes after the date hereof, the Maximum Rate
shall be automatically increased or decreased, as the case may be, without notice to the
Borrower from time to time as the effective date of each change in such maximum rate
period. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.54 <U>Mineral Interests</U> shall
mean rights, estates, titles, and interests in and to oil and gas leases and any oil and
gas interests, royalty and overriding royalty interest, production payment, net profits
interests, oil and gas fee interests, and other rights therein, including, without
limitation, any reversionary or carried interests relating to the foregoing, together with
rights, titles, and interests created by or arising under the terms of any unitization,
communization, and pooling agreements or arrangements, and all properties, rights and
interests covered thereby, whether arising by contract, by order, or by operation of Laws,
which now or hereafter include all or any part of the foregoing. </FONT></P>

1.55     Mortgaged Property or Mortgaged Properties shall have the meaning ascribed thereto in Section 3.2.

1.56     Mortgages shall have the meaning ascribed thereto in Section 4.1.

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.57 <U>Notes</U> collectively shall
mean the Notes, as described and defined in <U>Article II</U>, together with each and
every extension, renewal, modification, replacement, substitution and change in form
thereof which may be from time to time and for any term or terms effected. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.58 <U>OPA</U> shall mean the Oil
Pollution Act of 1990, as amended, together with all regulations and rulings promulgated
with respect thereto. </FONT></P>

1.59     Permitted Liens shall mean the Liens permitted in accordance with the provisions of Section 7.1.

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.60 <U>Person</U> shall mean and
include an individual, a partnership, a limited partnership, a limited liability company,
a joint venture, a corporation, a trust, an unincorporated organization, and
a&nbsp;government or any department, agency or political subdivision thereof. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.61 <U>Plan</U> shall mean any
employee pension benefit plan (as such term is defined in section 3 of ERISA) which is or
has been established or maintained, or to which contributions are or have been made, by
the Borrower or any ERISA Affiliate. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.62 <U>Polluting Substances</U>
shall mean all pollutants, contaminants, chemicals or industrial, toxic or hazardous
substances or wastes and shall include, without limitation, any flammable explosives,
radioactive materials, oil, hazardous materials, hazardous or solid wastes, hazardous or
toxic substances or related materials defined in CERCLA/SARA, RCRA/FISWA and in the HMTA;
provided, in the event either CERCLA/SARA, RCRA/HSWA or HMTA is amended so as to broaden
the meaning of any term defined thereby, such broader meaning shall apply subsequent to
the effective date of such amendment and, provided further, to the extent that the Laws of
any State or other Tribunal establish a meaning for hazardous substance, hazardous waste,
hazardous material, solid waste or toxic substance which is broader than that specified in
CERCLA/SARA, RCRA/HSWA, or HMTA, such broader meaning shall apply. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.63 <U>Pro Rata Portion</U> shall
mean, with respect to each Bank, the percentage of its Commitment to the aggregate
Commitment of all Banks or, if all of the Commitments hereunder have been terminated, the
percentage of the Revolver Loans and participations in Letters of Credit outstanding held
by such Bank compared to the aggregate of all Revolver Loans and participations in Letters
of Credit outstanding hereunder. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.64 <U>RCRA</U> shall mean the
Resource Conservation and Recovery Act of 1976, as amended, together with all regulations
and rulings promulgated with respect thereto. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.65 <U>Regulatory Change</U> shall
mean, with respect to any Bank, any change after the Closing Date in any Governmental
Requirement (including Regulation D) or the adoption or making after such date of any
interpretations, directives or requests applying to a class of Bank (including such Bank)
of or under any Governmental Requirement (whether or not having the force of law) by any
Governmental Authority charged with the interpretation or administration thereof. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.66 <U>Reserve Report </U>shall mean
a report, in form and substance satisfactory to the Agent, setting forth, effective as of
each December 31 (and to be delivered to the Agent no later than each February&nbsp;1) and
setting forth, effective as of each June 30 (and delivered to the Agent no later than each
August&nbsp;1), and/or such other date in the event of an unscheduled additional
redetermination; (i) the oil and gas reserves attributable to Collateral together with
a&nbsp;projection of the rate of production and future net income, taxes, operating
expenses and capital expenditures with respect thereto as of such date (including without
limitation an assessment of the effect of any Risk Management Agreements or fixed price
sales contracts with investment grade counterparts or purchases), based upon the pricing
assumptions consistent with the Agent&#146;s then applicable energy lending policies
pricing guidelines at the time, (ii) hydrocarbon prices, escalation rates, discount rate
assumptions, and any other economic assumptions, and (ii) such other information as the
Agent or any Bank may reasonably request. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.67 <U>Responsible Officer</U> shall
mean the chief executive officer, chief operating officer, president, chief financial
officer or managing director of the Borrower. Unless otherwise specified, all references
to a Responsible Officer shall mean Jeffrey R. Bailey. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.68 <U>Revolver Loans</U> shall mean
the advances to the Borrower described in <U>Section 2.1</U>, including the sum of
unfunded, outstanding Letters of Credit issued pursuant to <U>Article II</U>. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.69 <U>Revolving Credit Borrowing
Base</U> shall mean, as of the date of determination thereof, an amount as determined by
the Agent in its discretion in accordance with then-current practices, economic and
pricing parameters, and customary procedures and standards established by the Agent from
time to time for its petroleum industry customers including without limitation (a) an
analysis of such reserve and production data with respect to the Mineral Interests of the
Borrower in all of its oil and gas properties, including the Mortgaged Properties, as
provided to the Agent in accordance herewith, (b) an analysis of the assets, liabilities,
cash flow, business, properties, prospects, management and ownership of the Borrower and
its Affiliates, and (c) such other credit factors consistently applied as the Agent
customarily considers in evaluating similar oil and gas credits. The Revolving Credit
Borrowing Base shall initially be $2,600,000. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.70 <U>Required Bank</U>s shall mean
at any time while no Revolver Loans are outstanding, Banks having at least 75% of the
aggregate amount of the Commitments and, at any time while Revolver Loans are outstanding,
Banks holding at least 75% percent of the outstanding aggregate principal amount of the
Revolver Loans. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.71 <U>Risk Management
Agreements</U> shall mean any commodity, interest rate or currency Swap, rate cap, rate
floor, rate collar, forward agreement or other exchange, price or rate protection
agreements or any option with respect to any such transaction. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.72 <U>SARA</U> shall mean the
Superfund Amendments and Reauthorization Act of 1987, as amended, together with all
regulations and rulings promulgated with respect thereto. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.73 <U>Security Instruments</U>
shall mean the Mortgages, and all other financing statements, mortgages, assignments,
security agreements, documents or writings of any and all amendments and supplements
thereto, granting, conveying, assigning, transferring or in any manner providing the
Agent, for the benefit of the Banks, with a security interest or mortgage lien in any
property as security for the repayment of all or any part of the Indebtedness. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.74 <U>Subsidiary</U> shall mean (i)
any corporation, at least 50% of the total combined voting power of all classes of Voting
Stock of which shall, at the time as of which any determination is being made, be owned by
the Borrower either directly or through Subsidiaries, and (ii) any partnership, joint
venture or similar entity if at least a 50% interest in the profits or capital thereof is
owned by the Borrower, either directly or through Subsidiaries. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.75 <U>Subsidiary Guaranty
Agreement</U> shall mean that certain Subsidiary Guaranty Agreement dated June 29, 2006
executed by the domestic Subsidiaries of the Borrower in favor of the Agent for the
benefit of the Banks. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.76 <U>Swaps</U> shall mean, with
respect to any Person, payment obligations with respect to interest rate swaps, currency
swaps and similar obligations obligating such Person to make payments, whether
periodically or upon the happening of a contingency. For the purposes of this Agreement,
the amount of the obligations under any Swap shall be the amount determined in respect
thereof as of the end of then most recently ended fiscal quarter of such Person, based on
the assumption that such Swap had terminated at the end of such fiscal quarter, and in
making such determination, if any agreement relating to such Swap provides for the netting
of amounts payable by and to such Person thereunder or if any such agreement provides for
the simultaneous payment of amounts by and to such Person, then in each such case, the
amount of such obligation shall be the net amount so determined. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.77 <U>Taxes</U> shall mean all
taxes, assessments, fees, or other charges or levies from time to time or at any time
imposed by any Laws or by any Tribunal. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.78 <U>Termination Event</U> shall
mean (i) a Reportable Event described in Section 4043 of ERISA and the regulations issued
thereunder (other than a Reportable Event not subject to the provision for 30-day notice
to the PBGC under such regulations), or (ii) the withdrawal of the Borrower or any of
their ERISA Affiliates from a Plan during a plan year in which it was a substantial
employer as defined in Section 4001(a)(2) of ERISA, or (iii) the filing of a notice of
intent to terminate a&nbsp;Plan or the treatment of a Plan amendment as a termination
under Section 4041 of ERISA, or (iv)&nbsp;the institution of proceedings to terminate a
Plan by the PBGC, or (v) any other event or condition that might constitute grounds under
Section 4042 of ERISA for the termination of, or the appointment of a trustee to
administer, any Plan. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.79 <U>Tribunal</U> shall mean any
municipal, state, commonwealth, Federal, foreign, territorial or other sovereign,
governmental entity, governmental department, court, commission, board, bureau, agency or
instrumentality. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.80 <U>TSCA</U> shall mean the Toxic
Substances Control Act, as amended, together with all regulations and rulings promulgated
with respect thereto. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.81 <U>Wholly-Owned</U> shall mean,
as applied to any Subsidiary of any Person, a Subsidiary at least 98% (by vote or value)
of the outstanding equity interests (other than directors&#146; qualifying shares, if
required by law) of all classes, taken together as a whole, of which are at the time owned
by such Person or by one or more of its Wholly-Owned Subsidiaries or by such person and
one or more of the Wholly-Owned Subsidiaries. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.82 <U>Accounting Principles, Terms
and Determinations</U>. All references in this Agreement to Consistent Accounting
Principles shall be deemed to refer to generally accepted accounting principles in effect
in the United States at the time of application thereof. Unless otherwise specified
herein, all accounting terms used herein shall be interpreted, all determinations with
respect to accounting matters hereunder shall be made, and all unaudited financial
statements and certificates and reports as to financial matters required to be furnished
hereunder shall be prepared, in accordance with Consistent Accounting Principles, applied
on a basis consistent with the most recent audited consolidated financial statements of
the Borrower and its Subsidiaries delivered pursuant to <U>Section 6.8.2</U> or, if no
such statements have been so delivered, the most recent audited financial statements
referred to in <U>Section 9.4</U> hereof. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.83 <U>Other Definitional
Provisions</U>. References to Sections, subsections, Exhibits and Schedules shall be to
Sections, subsections, Exhibits and Schedules, respectively, of this Agreement unless
otherwise specifically provided. Any of the terms defined in <U>Article I</U> may, unless
the content otherwise requires, be used in the singular or the plural depending on the
reference. In this Agreement, words importing any gender include the other genders; the
words including, includes and include shall be deemed to be followed by the words without
limitation; references to agreements and other contractual instruments shall be deemed to
include subsequent amendments, assignments, and other modifications thereto, but only to
the extent such amendments, assignments and other modifications are not prohibited by the
terms of this Agreement or any other Loan Document; references to Persons include their
respective permitted successors and assigns or, in the case of governmental Persons,
Persons succeeding to the relevant functions of such Persons; and all references to
statutes and related regulations shall include any amendments of same and any successor
statutes and regulations. </FONT></P>

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<A NAME=A023></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE II  </FONT></H1>

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<A NAME=A024></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>LOANS </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.1 <U>Revolver Loans</U>. Upon the
terms and subject to the conditions hereinafter set forth, each Bank agrees to make
revolver loans, and the Letter of Credit Issuer agrees to issue Letters of Credit, from
time to time on or after the Closing Date to the Borrower (&#147;<U>Revolver
Loans</U>&#148;), the unpaid principal balance of which Revolver Loans is due and payable
at maturity on the Maturity Date. The outstanding amount shall not exceed the lesser of
(i) $50,000,000 (including without limitation, draws on Letters of Credit issued
hereunder), or (ii) the Commitment Amount (initially limited to the Initial Commitment of
$2,600,000), or (iii) the Revolving Credit Borrowing Base, as redetermined pursuant to
<U>Section 3.2</U> hereof. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each
Revolver Loan requested by the Borrower from the Banks from the Closing Date until the
Revolver Maturity Date shall (i) be requested in writing by a Responsible Officer of the
Borrower on the Revolver Loan Authorization Form (a copy of which is annexed hereto as
<U>Schedule 2.1</U>) which shall be delivered to the Agent prior to the close of such
Business Day on which the Revolver Loan is being requested and by no later than 10:00 a.m.
(applicable current time in Dallas, Texas) at least one (1) Business Day for any Revolver
Loan (other than a Libor Loan) prior to the date upon which each loan advance is to be
made, (ii) be in the amount of $10,000<B> </B>and in whole multiples of $5,000<B> </B>for
any amounts in excess of $10,000<B> </B>(unless the amount then available to borrow is
less than the foregoing stated amounts, in which event an advance may be made in the
amount available); (iii) not cause the aggregate outstanding and unpaid principal amount
of all of the Notes to exceed the lesser of the aggregate Commitment Amount of all of the
Banks or the Revolving Credit Borrowing Base; (iv) not cause the outstanding and unpaid
principal amount of the Note payable to a Bank to exceed the lesser of the Commitment
Amount of such Bank or such Bank&#146;s Pro Rata Portion of the Revolving Credit Borrowing
Base and (v) be advanced by the Banks on the applicable date, provided the request is
timely made in accordance with this <U>Section 2.1</U> hereof and all other conditions of
funding are met. Promptly following its receipt of a Revolver Loan Authorization Form in
accordance with this Section, the Agent shall advise each Bank of the details thereof and
of the amount of such Bank&#146;s Revolver Loan to be made as a part of the requested
advance. The Borrower may reborrow subject to the limitations and conditions for the
Revolver Loans contained herein. All advances made by the Banks on the Notes (including
the payment of drafts drawn on Letters of Credit) and all payments or prepayments of
principal and interest thereon made by the Borrower shall be recorded by the Agent in its
records, and the aggregate unpaid principal amount so recorded shall be prima facie
evidence of the principal amount owing and unpaid on the Notes. The failure to so record
shall not, however, limit or otherwise affect the obligations of the Borrower hereunder or
under the Notes to repay the principal amount of each Revolver Loan together with all
interest accrued thereon. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.2 <U>Notes</U>. On the Closing
Date, the Borrower shall execute and deliver to the order of each Bank a promissory note
in the original principal amount of such Bank&#146;s Commitment, the form of which is
annexed hereto as <U>Exhibit A</U>, and hereby made a part hereof (hereinafter referred to
as the &#147;<U>Notes</U>&#148;). The Notes shall be dated as of the Closing Date, and
shall provide for monthly interest payments due on the last day of every month, or the
next business day if the due date falls on a weekend or holiday, commencing July&nbsp;31,
2006. The unpaid and outstanding principal balance of the Notes, together with accrued but
unpaid interest thereon, shall be due and payable in full at the Maturity Date. The Notes
shall bear interest on unpaid balances of principal from time to time outstanding and on
any past due interest at a variable annual interest rate determined pursuant to <U>Section
2.9</U> hereof, but in no event at a rate greater than permitted by applicable law. All
payments received shall be applied first to accrued interest and then to the outstanding
principal amount owing on the Notes. All payments and prepayments shall be made in lawful
money of the United States of America. Any payments or prepayments on the Notes received
by the Agent after 12:00 noon (applicable current time in Dallas, Texas) shall be deemed
to have been made on the next succeeding Business Day. After maturity (whether by
acceleration or otherwise) the Notes shall bear interest at the Default Rate, payable on
demand. </FONT></P>

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<A NAME=A025></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.3 Proceeds of
Loans/Expiration of Commitment. </FONT></P>

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          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Proceeds of the Revolver Loans shall be used only for the purposes of (i)
          funding the Borrower&#146;s acquisition and/or development of certain oil and
          gas reserves; (ii) the issuance of Letters of Credit; (iii) working capital and
          general corporate purposes; (iv) refinancing or the existing Debt; and (v) to
          repurchase from Hoactzin Partners, L.P. (&#147;<U>Participant</U>&#148;) such
          rights, interests and obligations to drill the final six wells of that certain
          twelve well drilling program on the Borrower&#146;s properties in Kansas (as
          more particularly described in that Amendment to Drilling Program dated
          October&nbsp;3, 2005 between Participant and the Borrower) (such rights,
          interests and obligations are hereinafter referred to as the &#147;<U>Drilling
          Program Interests</U>&#148;) on the Closing Date for cash consideration not to
          exceed $1,800,000, all subject to the Revolving Credit Borrowing Base and the
          Commitment Amount. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Unless the Commitments shall be sooner terminated pursuant to the provisions of
          this Agreement or the other Loan Documents, the Commitments shall automatically
          extinguish on the Maturity Date. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.4 <U>Responsible Officer</U>. A
Responsible Officer may, from time to time, notify the Agent in writing of a change in the
Responsible Officers. From and after the Agent&#146;s receipt of such written notice, the
Agent may rely on any such request or certificate purportedly signed by any individual who
has been so designated as a Responsible Officer pursuant to this Agreement unless or until
it receives written notice from a Responsible Officer of the deletion of a Responsible
Officer. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.5 <U>Revolving Credit Borrowing
Base</U>. The Borrower will not request, nor will it accept, the proceeds of any Revolver
Loan or advance under the Notes (or the issuance of any Letter of Credit) at any time when
the amount thereof, together with the sum of the unpaid principal amount of the Notes plus
the unfunded portion of all Letters of Credit outstanding or requested by the Borrower to
be issued by Letter of Credit Issuer on behalf of or for the account of the Borrower, at
the time of such borrowing base calculation, exceeds the least of (a) the Revolving Credit
Borrowing Base in effect at that time, all in accordance with the provisions of <U>Article
III </U>(including redetermination thereof), (b) the Commitment Amount, or
(c)&nbsp;$50,000,000. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.6 <U>Variance from Revolving Credit
Borrowing Base</U>. Any Loan shall be conclusively presumed to have been made to the
Borrower by the Banks under the terms and provisions hereof and shall be secured by all of
the Collateral and security described or referred to herein or in the Security
Instruments, whether or not such loan conforms in all respects to the terms and provisions
hereof. If the Banks should (for the convenience of the Borrower or for any other reason)
make loans or advances or issue Letters of Credit which would cause the sum of the
aggregate unpaid principal amount of the Notes plus the unfunded portion of Letters of
Credit outstanding hereunder to exceed the amount of the Revolving Credit Borrowing Base
or the Commitment Amount, no such variance, change or departure shall prevent any such
loan or loans from being secured by the Collateral and security created or intended to be
created herein or in the Security Instruments. The Revolving Credit Borrowing Base shall
not in any manner limit the extent or scope of the Collateral and security granted for the
repayment of the Notes and Letters of Credit (or any other Indebtedness) or limit the
amount of indebtedness under the Notes or Letters of Credit (or any other Indebtedness) to
be secured. If the Agent should make an Revolver Loan as described in this Section, the
Banks shall be deemed, without further action by any party, to have unconditionally and
irrevocably purchased from the Agent without recourse or warranty, an undivided interest
and participation in such Revolver Loan in proportion to its Pro Rata Portion. From and
after the date, if any, a Bank is required to fund its participation in any such Revolver
Loan, the Agent shall promptly distribute to such Bank, its Pro Rata Portion of all
payments of principal and interest and all proceeds of Collateral received by the Agent in
respect of such advance. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.7 <U>Mandatory Prepayments</U>. The
Borrower shall make mandatory prepayments from time to time on the Notes as required by
<U>Sections 3.3</U> and <U>3.4</U> hereof. </FONT></P>

2.8      Fees.

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.8.1 <U>Redetermination Fee</U>. If
at any time the Banks agree to increase the Revolving Credit Borrowing Base, the Borrower
shall promptly (and in any event within 2 Business Days after it receives written
notification from the Banks of such increase in the Revolving Credit Borrowing Base) pay
to the Agent, for the ratable benefit of each Bank, a nonrefundable fee equal to one-half
of one percent (0.50%) of the increase in the Revolving Credit Borrowing Base as described
in <U>Section 3.2</U> or <U>Section 3.4</U>. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.8.2 <U>Commitment Fee</U>. In
addition to interest on the Notes as provided herein, and to compensate the Banks for
maintaining funds available, the Borrower shall pay to the Agent for the account of each
Bank a commitment fee, which shall accrue at the Applicable Margin on the average daily
amount of the available Commitment of such Bank during the period from and including the
Closing Date to but excluding the date on which the Banks&#146; Commitments terminate.
Accrued commitment fees shall be payable in arrears on the last day of each fiscal
quarter, commencing September 30, 2006, and on the date on which the Commitments
terminate, commencing on the first such date to occur after the date hereof. </FONT></P>

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<A NAME=A026></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.9 Interest Rates. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.9.1 <U>Interest Prior to
Maturity</U>. Subject to the provisions and limitations hereof, each Revolver Loan advance
hereunder shall accrue interest at: (i) the Applicable Prime Rate plus the Applicable
Margin or (ii) the Libor Rate plus the Applicable Margin. The Borrower shall notify the
Agent in writing of the Borrower&#146;s choice of interest rate on a particular advance
simultaneously with requesting such advance. The Borrower may elect to have interest
accrue at Libor plus the Applicable Margin as to any new or then outstanding Revolver
Loans provided (x) there is then no Default or Event of Default, unless such Default or
Event of Default has been waived in writing by the Agent, and (y) the Borrower have so
advised the Agent of its election to use Libor and the Libor Period selected no later than
three (3) Business Days prior to the proposed borrowing or, in the case of a Libor
election with respect to a then outstanding Revolver Loan, three (3) Business Days prior
to the conversion of any then outstanding Revolver Loans to Libor Loans and (z) the
election and Libor shall be effective, provided, there is then no unwaived Default or
Event of Default, on the fourth Business Day following said notice. No more than five (5)
Libor Loans may be outstanding at any time. If no such election is timely made or can be
made, then the Agent shall use the Applicable Prime Rate plus the Applicable Margin to
compute interest. Interest accruing at the Applicable Prime Rate shall be calculated based
on a calendar year of 365 days but assessed for the actual number of days elapsed during
each accrual period. Interest accruing at the Libor Rate shall be calculated based on a
calendar year of 360 days but assessed for the actual number of days elapsed during each
accrual period </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.9.2 <U>Interest After Maturity</U>.
After the principal amount of any of the Revolver Loans outstanding shall have become past
due (by acceleration or past the stated maturity date), such Loans shall bear interest for
each day until paid (before and after judgment) at the Default Rate. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.10 <U>Prepayments</U>. Subject to
the provisions of <U>Section 2.11</U> hereof, the Borrower shall have the right at its
option, from time to time, to prepay the Revolver Loans in whole or part without premium
or penalty at any time but subject to any costs under <U>Section&nbsp;2.19</U>. In
connection with any prepayment permitted hereby, the Borrower shall provide the Agent and
each Bank with the date, which shall be a Business Day, on which the proposed prepayment
is to be made; and the aggregate principal amount of such partial prepayment of a Revolver
Loan advance, which shall be an integral multiple of $100,000. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.11 <U>Interest Payments Dates</U>.
Interest on all of the Revolver Loans advances shall be due and payable on the last day of
every month, or the next business day if the due date falls on a weekend or holiday,
commencing July&nbsp;31, 2006. After maturity of the Notes (by acceleration or otherwise),
interest thereon shall be due and payable on demand. </FONT></P>

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<A NAME=A027></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.12 Payments; Settlement. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.12.1 <U>Payments From the
Borrower</U>. All payments to be made in respect of principal, interest or other amounts
due from the Borrower hereunder or under the Notes shall be payable to the Agent for the
account of the Banks at 10:00 a.m., Central Time in Dallas, Texas, on the day when due
without presentment, demand, protest or notice of any kind, all of which are hereby
expressly waived, and an action therefor shall immediately accrue if not timely paid
within applicable grace or curative periods herein specified. Such payments shall be made
to the Agent for the account of the Banks at its Dallas, Texas main banking office in U.S.
Dollars in funds immediately available at such office without set off, counterclaim or
other deduction of any nature. To the extent permitted by law, after there shall have
become due (by acceleration or otherwise) interest or any other amounts due from the
Borrower hereunder or under the Notes (excluding overdue principal, which shall bear
interest as described in <U>Section 2.9.2</U> hereof, but including interest payable under
this <U>Section 2.12</U>), such amounts shall bear interest for each day until paid
(before and after judgment), payable on demand, at the Default Rate. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.12.2 <U>Payments from/to Banks</U>.
Each Bank shall make each Revolver Loan to be made by it hereunder on the proposed date
thereof by wire transfer of immediately available funds by 11:00 a.m. Dallas, Texas time
to the account of the Agent most recently designated by the Agent for such purpose by
notice to the Banks in an amount equal to such Bank&#146;s Pro Rata Portion. Each payment
received by the Agent under this Agreement or any other Loan Document for the account of a
Bank shall be paid promptly to such Bank, in immediately available funds, for the account
of such Bank&#146;s applicable lending office. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.12.3 <U>Full Payment</U>. All
outstanding principal and accrued but unpaid interest on the Notes shall be due and
payable at the Maturity Date. </FONT></P>

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<A NAME=A028></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.13 Letters of Credit. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.13.1 <U>Letters of Credit</U>. Upon
the Borrower&#146;s application from time to time by use of the Letter of Credit
Issuer&#146;s standard form Letter of Credit Application Agreement and subject to the
terms and provisions therein and herein set forth, the Letter of Credit Issuer agrees to
issue Letters of Credit on behalf of the Borrower under the Commitment in an aggregate
unfunded amount not in excess of the LC Commitment; <U>provided</U> that (i) all Letters
of Credit issued on behalf of or on the account of the Borrower shall have a term of not
more than one (1) year, and (ii) no Letter of Credit shall have an expiry date that is
later than five (5) days before the Maturity Date, and (iii) no Letter of Credit will be
issued on behalf of or for the account of the Borrower if at the time of issuance the
outstanding amount of all unpaid Revolver Loan advances (including the aggregate
outstanding and unfunded amount of unexpired Letters of Credit then existing) under the
aggregate Commitment as evidenced by the Notes plus the maximum amount of such Letter of
Credit then being requested would exceed the lesser of (i) the Revolving Credit Borrowing
Base, or (ii) the aggregate Commitment Amount. If any letter of credit is drawn upon at
any time, each amount drawn, whether a full or partial draw thereon, shall be
automatically reflected as an advance on the Notes effective as of the date of the Letter
of Credit Issuer&#146;s honoring the sight draft. In consideration of the Letter of Credit
Issuer&#146;s agreement to issue standby letters of credit hereunder, the Borrower agrees
to pay to the Letter of Credit Issuer, a fronting fee which shall accrue at a rate equal
to one-eighth of one percent (0.125%) per annum of the average daily amount of the Letter
of Credit Exposure. The Borrower agrees to pay to the Agent for the account of each
Revolving Bank a participation fee with respect to its participations in Letters of Credit
under <U>Section 2.13.5</U>, which shall accrue at the same Applicable Margin as interest
on Libor Loans on the average daily amount of such Bank&#146;s LC&nbsp; Exposure
(excluding any portion thereof attributable to unreimbursed disbursements under Letters of
Credit) during the period from and including the Closing Date to but excluding the later
of the date on which such Bank&#146;s Commitment terminates and the date on which such
Bank ceases to have any LC&nbsp;Exposure. Such fronting fees and participation fees shall
be due quarterly in arrears as of the last day of each calendar quarter, commencing
September 30, 2006, calculated on the basis of a 360-day year. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.13.2 <U>Presentation</U>. The
Letter of Credit Issuer may accept or pay any draft presented to it, regardless of when
drawn and whether or not negotiated, if such draft, the other required documents and any
transmittal advice required under the Letter of Credit and appearing to be in compliance
with the terms thereof are presented to the Letter of Credit Issuer and dated on or before
the expiration date of the Letter of Credit under which such draft is drawn. Except
insofar as instructions actually received may be given by the Borrower in writing
expressly to the contrary with regard to, and prior to, the Letter of Credit Issuer&#146;s
issuance of any Letter of Credit for the account of the Borrower and such contrary
instructions are reflected in such Letter of Credit, to the maximum extent permitted by
law the Letter of Credit Issuer may honor as complying with the terms of the Letter of
Credit and with this Agreement any drafts or other documents otherwise in order signed or
issued by an administrator, executor, conservator, trustee in bankruptcy, debtor in
possession, assignee for benefit of creditors, liquidator, receiver or other legal
representative of the party authorized under such Letter of Credit to draw or issue such
drafts or other documents. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.13.3 <U>Uniform Customs and
Practice</U>. The Uniform Customs and Practice for Documentary Credits (1993 Revision),
International Chamber of Commerce Publication No. 500, and any subsequent revisions
thereof approved by a Congress of the International Chamber of Commerce and adhered to by
the Letter of Credit Issuer (the &#147;<U>Uniform Customs and Practice</U>&#148;), shall
be binding on the Borrower and the Letter of Credit Issuer except to the extent otherwise
provided herein, in any Letter of Credit or in any other Loan Document. Anything in the
Uniform Customs and Practice to the contrary notwithstanding: </FONT></P>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Neither the Borrower nor any beneficiary of any Letter of Credit shall be deemed
          an agent of any Letter of Credit Issuer. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          With respect to each Letter of Credit, neither any Letter of Credit Issuer nor
          its correspondents shall be responsible, except to the extent required by law,
          for or shall have any duty to ascertain: </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(i)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          the genuineness of any signature; </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(ii)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          the validity, form, sufficiency, accuracy, genuineness or legal effect of any
          endorsements; </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(iii)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          delay in giving, or failure to give, notice of arrival, notice of refusal of
          documents or of discrepancies in respect of which any Letter of Credit Issuer
          refuses the documents or any other notice, demand or protest; </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(iv)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          the performance by any beneficiary under any Letter of Credit of such
          beneficiary&#146;s obligations to the Borrower; </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(v)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          inaccuracy in any notice received by the Letter of Credit Issuer; </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(vi)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          the validity, form, sufficiency, accuracy, genuineness or legal effect of any
          instrument, draft, certificate or other document required by such Letter of
          Credit to be presented before payment of a draft, or the office held by or the
          authority of any Person signing any of the same; or </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(vii)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          failure of any instrument to bear any reference or adequate reference to such
          Letter of Credit, or failure of any Person to note the amount of any instrument
          on the reverse of such Letter of Credit or to surrender such Letter of Credit or
          to forward documents in the manner required by such Letter of Credit. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          In the event of any conflict between the provisions of this Agreement and the
          Uniform Customs and Practice and Article 5 of the Uniform Commercial Code, the
          provisions of this Agreement shall govern to the maximum extent permitted by
          applicable law. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.13.4 <U>Modification, Consent</U>.
If the Borrower requests or consents in writing to any modification or extension of any
Letter of Credit, or waives any failure of any draft, certificate or other document to
comply with the terms of such Letter of Credit, and if the Letter of Credit Issuer
consents thereto, the Letter of Credit Issuer shall be entitled to rely on such request,
consent or waiver. This Agreement shall be binding upon the Borrower with respect to such
Letter of Credit as so modified or extended, and with respect to any action taken or
omitted by such Letter of Credit Issuer pursuant to any such request, consent or waiver. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.13.5 <U>Participations</U>. By the
issuance of a Letter of Credit (or an amendment to a Letter of Credit increasing the
amount thereof) and without any further action on the part of the Letter of Credit Issuer
or the Banks, the Letter of Credit Issuer hereby grants to each Bank, and each Bank hereby
acquires from the Letter of Credit Issuer, a participation in such Letter of Credit equal
to such Bank&#146;s Pro Rata Portion of the aggregate amount available to be drawn under
such Letter of Credit. In consideration and in furtherance of the foregoing, each Bank
hereby absolutely and unconditionally agrees to pay to the Agent, for the account of the
Letter of Credit Issuer, such Bank&#146;s Pro Rata Portion of each disbursement under a
Letter of Credit made by the Letter of Credit Issuer and not reimbursed by the Borrower on
the date due as provided in this <U>Section 2.13</U>, or of any reimbursement payment
required to be refunded to the Borrower for any reason. Each Bank acknowledges and agrees
that its obligation to acquire participations pursuant to this paragraph in respect of
Letters of Credit is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including any amendment, renewal or extension of any Letter of
Credit or the occurrence and continuance of a Default or reduction or termination of the
Commitments, and that each such payment shall be made without any offset, abatement,
withholding or reduction whatsoever. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.14 <U>Increased Costs</U>. If, due
to either (a) the introduction of or any change in or in the interpretation of any law or
regulation or (b) compliance with any guideline or request from any central bank or other
governmental authority (whether or not having the force of law), there shall be any
increase in the cost to, or reduction in amounts receivable by any Bank, or in connection
with any Bank of agreeing to make or making, funding or maintaining any Note, then the
Borrower shall from time to time, upon demand by the effected Bank, pay to such Bank,
additional amounts sufficient to compensate such Bank for such increased cost. A
certificate as to the amount of such increased cost, submitted to the Borrower and the
Agent, shall be conclusive and binding for all purposes, absent manifest error. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.15 <U>Capital Adequacy</U>. If (a)
the introduction of or any change in or in the interpretation of any law or regulation,
(b) compliance with any law or regulation, or (c)&nbsp;compliance with any guideline or
request from any central bank or other governmental authority (whether or not having the
force of law) affects or would affect the amount of capital required or expected to be
maintained by any Bank or any corporation controlling any Bank and such Bank reasonably
determines that such amount is based upon the existence of such Bank&#146;s Commitment
hereunder or its Revolver Loans evidenced by the Note payable to it and other loans of
this type, then, upon demand by such Bank, the Borrower shall pay to such Bank, from time
to time as specified by the Agreement, additional amounts sufficient to compensate such
Bank in the light of such circumstances, to the extent that such Bank reasonably
determines such increase in capital to be allocable to the existence of the Revolver Loans
payable to it. A certificate as to such amounts submitted to the Borrower and the Agent
shall be conclusive and binding for all purposes, absent manifest error. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.16 <U>Pro Rata Treatment</U>.
Except to the extent otherwise provided herein: (a) each Revolver Loan shall be made by
the Banks under <U>Section 2.1</U>, each payment of fees under <U>Section&nbsp;2.8</U> and
<U>Section 2.13</U> shall be made for the account of the Banks, and each termination or
reduction of the Commitments hereunder shall be applied to the Commitments of the Banks,
pro rata according each Bank&#146;s Pro Rata Portion, and (b) each payment and prepayment
of principal of or interest on Revolver Loans by the Borrower shall be made to the Agent
for the account of the Banks holding Revolver Loans pro rata in accordance each
Bank&#146;s Pro Rata Portion of the unpaid principal amounts of such Revolver Loans held
by such Banks. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.17 <U>Sharing of Payments, etc</U>.
If a Bank shall obtain payment of any principal of or interest on any of the Indebtedness
due to such Bank hereunder through the exercise of any right of set off, banker&#146;s
lien, counterclaim or similar right, or otherwise, it shall promptly purchase from the
other Banks participations in the Indebtedness held by the other Banks in such amounts,
and make such adjustments from time to time as shall be equitable to the end that all the
Banks shall share pro rata in accordance with the unpaid principal and interest on the
Indebtedness then due to each of them. To such end, all of the Banks shall make
appropriate adjustments among themselves (by the resale of participations sold or
otherwise) if all or any portion of such excess payment is thereafter rescinded or must
otherwise be restored. The Borrower agrees, to the fullest extent it may effectively do so
under applicable law, that any Bank so purchasing a participation in the Indebtedness by
the other Banks may exercise all rights of set-off, banker&#146;s lien, counterclaim, or
similar rights with respect to such participation as fully as if such Bank were a direct
holder of Indebtedness to the Borrower in the amount of such participation. Nothing
contained herein shall require any Bank to exercise any such right or shall affect the
right of any Bank to exercise, and retain the benefits of exercising, any such right with
respect to any other indebtedness or obligation of the Borrower. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.18 <U>Non-Receipt of Funds by the
Agent</U>. Unless the Agent shall have been notified by a Bank or the Borrower (the
&#147;<U>Payor</U>&#148;) prior to the date on which such Bank is to make payment to the
Agent of the proceeds of a Revolver Loan to be made by it hereunder or the Borrower is to
make a payment to the Agent for the account of one or more of the Banks, as the case may
be (such payment being herein called the &#147;<U>Required Payment</U>&#148;), which
notice shall be effective upon receipt, that the Payor does not intend to make the
Required Payment to the Agent, the Agent may assume that the Required Payment has been
made and may, in reliance upon such assumption (but shall not be required to), make the
amount thereof available to the intended recipient on such date and, if the Payor has not
in fact made the Required Payment to the Agent, the recipient of such payment shall, on
demand, pay to the Agent the amount made available to it together with interest thereon in
respect of the period commencing on the date such amount was so made available by the
Agent until the date the Agent recovers such amount at a rate per annum equal to the
Federal Funds Rate for such period. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.19 <U>Breakage Costs</U>. The
Borrower shall pay to the Banks such amount or amounts as shall compensate the Banks or
their participants, if any, for any loss, costs or expenses incurred by the Banks or their
participants if any (as reasonably determined by the Banks or their participants) as a
result of: (a)&nbsp;any payment or prepayment on a date other than the last day of a Libor
Period for such Libor Loan, or (b)&nbsp;any failure of the Borrower to borrow a Libor Loan
on the date for such borrowing specified in the relevant notice; such compensation to
include, without limitation, an amount equal to any loss or expense suffered by the Banks
or their participants if any, during the period from the date of receipt of such payment
or prepayment or the date of such failure to borrow to the last day of such Libor Period
if the rate of interest obtained by the Banks or their participants if any, upon the
reemployment of an amount of funds equal to the amount of such payment, prepayment or
failure to borrow is less than the rate of interest applicable to such Libor Loan for such
Libor Period. The determination by the Banks or their participants, if any, of the amount
of any such loss or expense, when set forth in a written notice to the Borrower,
containing the calculations thereof in reasonable detail, shall constitute prima facie
evidence thereof. </FONT></P>

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<A NAME=A029></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE III  </FONT></H1>

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<A NAME=A030></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>REVOLVING CREDIT
BORROWING BASE </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.1 <U>Initial Revolving Credit
Borrowing Base</U>. Until further determination by the Agent pursuant to the semiannual
determinations of <U>Section 3.2(a)</U> below or otherwise pursuant to <U>Section 3.4</U>
hereof, the Agent, each Bank and the Borrower agrees and stipulates that the initial
Revolving Credit Borrowing Base is $2,600,000, subject to the conditions precedent
required by the provisions of <U>Article V</U> hereof. </FONT></P>

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<A NAME=A031></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.2 Revolving Credit
Borrowing Base Determination. </FONT></P>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          The Borrower shall deliver to the Agent, at the Borrower&#146;s cost, by each
          February&nbsp;1 and August&nbsp;1, commencing August&nbsp;1, 2006, a Reserve
          Report. The Reserve Report required to be furnished by the Borrower to the Agent
          no later than February&nbsp;1 of each year shall be prepared by an Approved
          Engineer. The Reserve Report required to be furnished by the Borrower to the
          Agent no later than August 1 of each year may be prepared by Borrower&#146;s
          in&#150;house engineering staff. Each Reserve Report shall be accompanied by
          such other information as shall be requested by the Agent in order for the Agent
          to make its determination of the Revolving Credit Borrowing Base, and by a
          certificate of the Borrower certifying that the Borrower has good and defensible
          title to the Mortgaged Property interest valued and that payments are being
          received from purchasers of production with respect to said interests. At any
          time within thirty (30) days of the receipt of such information and in no event
          later than each March 1 and September 1 (commencing September 1, 2006) (the
          &#147;<U>Semiannual Borrowing Base Redetermination Dates</U>&#148;), the Agent
          shall make a determination of the present worth, using such pricing and discount
          factor as it deems appropriate pursuant to the Agent&#146;s then applicable
          energy lending policies and procedures, of the future net revenue estimated
          thereby to be received by the Borrower from production from the Mortgaged
          Property so evaluated, multiplied by a percentage determined by the Agent to be
          appropriate on the basis of the Agent&#146;s then applicable energy lending
          criteria and otherwise consistent with the standards set forth in the definition
          of Revolving Credit Borrowing Base in <U>Article I</U>. By each Semiannual
          Borrowing Base Redetermination Date, the Agent shall report in writing to the
          Borrower and each Bank its determination of the Revolving Credit Borrowing Base,
          which shall in no event exceed the lesser of then applicable Commitment Amount
          or $50,000,000. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any
redetermination of the Revolving Credit Borrowing Base shall not be in effect until
written notice thereof is received by the Borrower. The good faith determinations of the
Agent in all such respects shall be conclusive. </FONT>
</TD>
</TR>
</TABLE>
<BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          The term &#147;<U>Mortgaged Property</U>&#148; or &#147;<U>Mortgaged
          Properties</U>&#148; shall refer only to such properties of the Loan Parties
          covered by the Mortgages (or a supplemental or amended mortgage or deed of
          trust, duly executed, acknowledged and delivered by the Borrower to the Agent in
          form satisfactory to counsel for the Agent) and which properties are, at the
          time: </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(i)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          particularly and adequately described under the Mortgages or other supplemental
          or amended mortgage and deed of trust as security for the Indebtedness evidenced
          by the Notes; </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(ii)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          completed or developed (in the case of Mineral Interests) to the extent that
          value is being assigned to them by the Agent in connection with its evaluation
          of the Revolving Credit Borrowing Base and the Agent has determined that such
          properties are capable of producing oil or gas in commercial quantities; and </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(iii)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          approved as to title to the satisfaction of the Agent, including Title Reports
          acceptable to the Agent as contemplated by the provisions of
          <U>Section&nbsp;5.1(h)</U>. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          The Revolving Credit Borrowing Base (initially $2,600,000) shall remain in
          effect until September 1, 2006, or as otherwise changed by written agreement
          between the Borrower, the Banks and the Agent pursuant to the procedures
          established herein. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.3 <U>Revolving Credit Borrowing
Base Deficiency</U>. Should the unpaid outstanding principal balance of the Notes,
together with the unfunded portion of all outstanding and requested Letters of Credit, at
any time be greater than the Revolving Credit Borrowing Base in effect at such time (a
&#147;<U>Borrowing Base Deficiency</U>&#148;), the Agent shall notify the Borrower in
writing of the deficiency. Within ten (10) days from and after the date of any such
deficiency notice, the Borrower shall notify the Agent and the Banks in writing of its
election to select any of the following (including any combination thereof acceptable to
the Agent and the Required Banks): </FONT></P>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Make a prepayment upon the Notes in an amount sufficient to reduce the unpaid
          principal amount of the Notes, when added to the unfunded portion of all
          outstanding and requested Letters of Credit, to an amount equal to or less than
          the amount of the Revolving Credit Borrowing Base; </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Make mandatory equal monthly principal prepayments on the Notes due on the next
          three (3) successive monthly installment due dates on the Notes equal in an
          aggregate amount that will reduce the outstanding principal balance of the
          Notes, when added to the unfunded portion of all outstanding and requested
          Letters of Credit, to the projected Revolving Credit Borrowing Base as of the
          next immediate semi-annual redetermination thereof in accordance with the
          provisions of <U>Section 3.2(a)</U> hereof, together with interest on such
          excess amount at the Default Rate. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Execute and deliver to the Agent one or more supplemental mortgages, deeds of
          trust, security agreements or pledges encumbering such other collateral or
          assets in form, substance and value satisfactory to the Agent and its counsel as
          additional security for the Notes (and all other Indebtedness) to the extent
          such collateral or properties are acceptable to the Agent and of such value, as
          determined by the Agent, that the Revolving Credit Borrowing Base will be
          increased to an amount equal to or greater than the sum of the unpaid principal
          balance of the Notes plus the unfunded portion of all outstanding Letters of
          Credit. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>If the Borrower shall have elected to
make a prepayment on the Notes under <U>Section&nbsp;3.3(a)</U> hereof, such prepayment
shall be due within five (5) Business Days after the Borrower shall have notified the
Agent of such election. If the Borrower shall elect to make three (3) equal monthly
principal prepayments on the Notes due to the Banks under <U>Section&nbsp;3.3(b)</U>
hereof, the Agent shall roll forward its then most current engineering determination and
determine the projected Revolving Credit Borrowing Base for the next successive semiannual
determination date (either March 1 or September 1 as the case may be), or such other
semiannual determination date for the Revolving Credit Borrowing Base as may be effected
in accordance with the provisions of <U>Section 3.2</U> hereof. If the Borrower shall
elect to execute and deliver one or more supplemental mortgages, deeds of trust and/or
pledges to the Agent under <U>Section 3.3(c)</U> hereof, the Borrower shall provide the
Agent with descriptions of the additional properties to be mortgaged (together with any
title opinions, current valuations and engineering reports applicable thereto which may be
requested by the Agent) at the time of the Borrower&#146;s notice of such election and
shall execute, acknowledge and deliver to the Agent the appropriate supplemental
mortgages, deeds of trust and/or pledges within three (3) Business Days after such
collateral documents shall be tendered to the Borrower by the Agent for execution, all in
compliance with the provisions of clauses (i), (ii) and (iii) of <U>Section 3.2(b)</U>
above. </FONT></P>

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<A NAME=A032></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.4 Additional
Redeterminations. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.4.1 <U>Asset Dispositions</U>. The
sale, assignment or other disposition by the Borrower of Mortgaged Properties (with the
Agent&#146;s prior written consent) shall constitute an automatic reduction of the
Revolving Credit Borrowing Base by the greater of (i) the net of such gross sales price
amount minus any expenses and taxes directly attributable thereto or (ii) then applicable
Revolving Credit Borrowing Base valuation assigned thereto, and any resultant deficiency
therein shall be cured by a single lump sum cash payment pursuant to <U>Section 3.3(a)
</U>hereof. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.4.2 <U>Redeterminations on the
Request of the Agent or Required Banks</U>. The Agent may (or at the direction of the
Required Banks shall) from time to time upon thirty (30) days prior written notice to the
Borrower, initiate and make additional unscheduled redeterminations of the Revolving
Credit Borrowing Base during any consecutive twelve (12) month period. Such additional
unscheduled redeterminations initiated at the Agent&#146;s request shall be at the
Borrower&#146;s sole cost. In such instance, the Agent shall specify in writing to the
Borrower the date on which the Borrower is to furnish its Reserve Report in accordance
with <U>Section 3.2(a)</U> and the date on which such additional redetermination is to
occur. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.4.3 <U>Redeterminations on the
Request of the Borrower</U>. The Borrower may from time to time request additional
redeterminations of the Revolving Credit Borrowing Base; <U>provided</U> that each request
by the Borrower for an unscheduled redetermination of the Revolving Credit Borrowing Base
(a) shall be at the sole cost of the Borrower, (b) shall result in the Borrower&#146;s
payment of reasonable third party engineering fees and expenses to the Agent for each such
additional unscheduled redetermination request; and (c) shall only occur once between each
Scheduled Borrowing Base Redetermination Dates set forth in <U>Section 3.2</U>. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>In the event of an additional
unscheduled redetermination pursuant to this <U>Section 3.4</U>, the methodology, manner,
time and condition of such redetermination shall be in accordance with the terms,
provisions and conditions of <U>Section 3.2(a)</U> and the standards set forth in the
definition of Revolving Credit Borrowing Base in <U>Article I</U>. </FONT></P>

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<A NAME=A033></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE IV  </FONT></H1>

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<A NAME=A034></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>COLLATERAL </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4.1 <U>Collateral</U>. The repayment
of the Indebtedness shall be secured by (a) mortgages, deeds of trust, security
agreements, financing statements and assignments (with power of sale) for each of the
Mortgaged Properties dated as of the Closing Date, each in form and substance satisfactory
to the Agent, and executed by the applicable Loan Parties (the
&#147;<U>Mortgages</U>&#148;) and (b) a pledge of all of the outstanding capital stock or
partnership interests of all existing and future Subsidiaries (if any) (the collateral
described in this <U>Section 4.1</U>, <U>Section 4.2</U> and in any other Security
Instrument being collectively referred to as the &#147;<U>Collateral</U>&#148;). Upon
request of the Agent, the Loan Parties shall promptly execute and deliver to the Agent
such assignments, security agreements, agreements, consents, waivers, financing
statements, mortgages, stock powers and other documents, as may be deemed necessary or
advisable by the Agent to secure or perfect its security interest in the Collateral,
including without limitation any pipeline owned or operated by Tengasco Pipeline
Corporation. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4.2 <U>Grant of Security
Interest</U>. As collateral security for the prompt payment and performance in full when
due of the Indebtedness (whether at stated maturity, by acceleration or otherwise), the
Borrower hereby pledges and assigns to the Agent, for the benefit of the Banks, and grants
to the Agent a continuing lien on and security interest in, all of the Borrower&#146;s
right, title and interest in and to the following, whether now owned or hereafter arising
or acquired and wherever located: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4.2.1 all capital stock, membership
interests, general and limited partnership interests and any other ownership interest in
the Borrower&#146;s Subsidiaries, whether now owned or hereafter acquired including,
without limitation, all capital stock issued by Tennessee Land &amp; Mineral Corporation
and Tengasco Pipeline Corporation; and </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4.2.2 all proceeds, products,
revenues, distributions, dividends, securities and other property, rights, interests and
other general intangibles that the Borrower receives or is at any time entitled to receive
on account of the property described in the foregoing clause 4.2.1. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4.3 <U>Additional Mortgaged
Properties</U>. As an additional condition precedent to any Revolver Loans requested by
the Borrower pursuant to <U>Section 2.1</U> hereof, the Agent has the right, in its sole
discretion or at the direction of the Required Banks, to elect to take any or all of the
properties to be acquired in domestic oil and gas reserve acquisitions made by the
Borrower with Revolver Loans funded hereunder or otherwise, as Collateral for the
Indebtedness pursuant to such supplemental or additional mortgages, deeds of trusts or
security agreements covering such additional properties in form and substance satisfactory
to the Agent and its counsel and in full compliance with the criteria of <U>clauses
(i)</U>, <U>(ii)</U> and <U>(iii)</U> of <U>Section 3.2(b)</U> above as additional
security for the Notes and the Indebtedness. All of such additional properties will be
deemed part and parcel of the Collateral constituting security for the repayment of the
Indebtedness. </FONT></P>

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<A NAME=A035></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE V  </FONT></H1>

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<A NAME=A036></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>CONDITIONS PRECEDENT
TO LOANS </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5.1 <U>Conditions Precedent to
Closing and Funding of Commitment</U>. The effectiveness of this Agreement and the
obligation of the Banks to issue the Commitments and make the initial Revolver Loans (or
the Letter of Credit Issuer to issue Letters of Credit) under the Commitment are subject
to the satisfaction of all of the following conditions on or prior to the Closing Date (in
addition to the other terms and conditions set forth herein): </FONT></P>

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          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          <U>No Default</U>. There shall exist no Event of Default or Default on the
          Closing Date. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          <U>Representations and Warranties</U>. The covenants, representations and
          warranties set forth herein and in the other Loan Documents shall be true and
          correct in all material respects on and as of the Closing Date, with the same
          effect as though made on and as of the Closing Date. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          <U>Loan Party Certificates</U>. Each Loan Party shall have delivered to the
          Agent a Certificate, dated as of the Closing Date, and signed by the President
          and the Secretary of such Loan Party certifying (i) to the matters covered by
          the conditions specified in subsections (a) and (b) of this <U>Section 5.1</U>,
          (ii) that such Loan Party has performed and complied with all agreements and
          conditions required to be performed or complied with by it prior to or on the
          Closing Date, (iii) to the name and signature of each officer or representative
          of such Loan Party authorized to execute and deliver the Loan Documents, and
          (iv) to such other matters in connection with this Agreement which the Agent
          shall determine to be advisable. The Agent may conclusively rely on such
          Certificates until it receives notice in writing to the contrary. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(d)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          <U>Proceedings</U>. All corporate proceedings of each Loan Party shall be taken
          in connection with the transactions contemplated by the Loan Documents and shall
          be satisfactory in form and substance to the Agent and its counsel; and the
          Agent shall have received certified copies, in form and substance satisfactory
          to the Agent and its counsel, of the Articles of Incorporation and Bylaws of
          each Loan Party and the resolutions of the board of directors thereof, as
          adopted, authorizing the execution and delivery of the Loan Documents, the
          borrowings under this Agreement, and the granting of the security interests in
          the Collateral pursuant to the Security Instruments, to secure the payment of
          the Indebtedness. Each Loan Party shall have caused to be delivered to the Agent
          certificates of appropriate state agencies with respect to the existence,
          qualification and good standing of such Loan Party. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(e)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          <U>Notes</U>. The Borrower shall have executed and delivered to the Agent the
          Notes payable to the order of each Bank and this Agreement, each appropriately
          executed to the satisfaction of the Agent. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          <U>Closing Opinion of the Loan Parties&#146; Counsel</U>. The Agent shall have
          received from legal counsel to the Loan Parties acceptable to the Agent,
          favorable written closing opinions covering, among other things, the
          enforceability of the Loan Documents including, without limitation, the
          Mortgages in each case, in form, scope and substance satisfactory to the Agent
          and its legal counsel. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(g)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          <U>Mortgages</U>. The Loan Parties shall execute and deliver to the Agent (i)
          either (A) multiple originals of the Mortgages, as described in <U>Section
          4.1</U> hereof above, with all schedules and exhibits to each thereof completed
          to the Agent&#146;s satisfaction or (B) assignments of existing mortgages, deeds
          of trust, security agreements, financing statements and assignments (with power
          of sale) in favor of the Agent in form and substance satisfactory to the Agent,
          and (ii) applicable UCC financing statements duly executed and delivered by each
          Loan Party as deemed necessary or appropriate by the Agent to perfect the
          security interest in the Collateral in favor of the Agent, together with
          multiple counterparts of letters-in-lieu. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(h)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          <U>Title Reports</U>. The Agent shall have received satisfactory title reports
          reviewed and approved by the Agent and such attorney(s) selected by the Borrower
          and acceptable to the Agent concerning the Mortgaged Properties, which Title
          Reports shall recite to the Agent that title to such examined properties is
          generally acceptable pursuant to industry standards and prudent oil and gas
          title examination standards in the jurisdictions where the Mortgaged Property is
          located. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(i)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          <U>Reserve Reports/Pro Forma Financials</U>. The Agent shall have received and
          reviewed to its satisfaction, such comprehensive Reserve Reports and pro forma
          financial statements of the Loan Parties as the Agent may request, together with
          such additional information regarding litigation, taxes, account, insurance,
          pension liabilities, real estate leases, material contracts, debt agreements,
          property ownership, contingent liabilities and other information as the Agent
          may request. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(j)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          <U>Environmental Review</U>. The Agent shall have received and reviewed to its
          satisfaction environmental reports relating to the Mortgaged Property, as
          prepared by consulting firms satisfactory to the Agent. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(k)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          <U>Reconciliation Schedule</U>. The Agent shall have received a Reconciliation
          Schedule, substantially in the form of <U>Exhibit C</U> attached hereto, signed
          by the Responsible Officer of the Borrower. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(l)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          <U>Compliance Certificate</U>. The Agent shall have received a Compliance
          Certificate, signed by the Responsible Officer of the Borrower. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(m)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          <U>Stock Certificates<B></B></U><B>. </B>All of the stock certificates issued
          by<B> </B>Tennessee Land &amp; Mineral Corporation and Tengasco Pipeline
          Corporation accompanied by stock powers related thereto executed by the Borrower
          in blank; </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(n)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          <U>Drilling Program Interests</U>.<B> </B>Evidence of the Borrower&#146;s
          purchase of the Drilling Program Interests, in form and substance satisfactory
          to the Agent. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(o)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          <U>Other Information</U>. The Agent shall have received such other information,
          documents and assurances as shall be requested by the Agent or by any of the
          Banks, including without limitation, applicable Form UCC-4 or equivalent search
          reports, judgment and tax lien searches concerning the Loan Parties and the
          Collateral, certificates of insurance relating to the Mortgaged Properties
          naming the Agent and the Banks as loss payee and as mortgagee, such other
          information with respect to the Collateral as shall be requested by the Agent or
          any of the Banks and such documentation satisfactory in form and substance to
          the Agent demonstrating that the Loans advanced hereunder as evidenced by the
          Notes at all times paramount, senior and prior in right of payment. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

5.2      Credit Extensions.  On the date of each Revolver Loan advance:

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          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          The Agent shall have received a notice of such Revolver Loan advance request as
          required by <U>Section 2.1 </U> hereof, as applicable. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          The representations and warranties set forth in this Agreement and in each of
          the other Loan Documents shall be true and correct in all material respects on
          and as of the date of such Revolver Loan advance with the same effect as though
          made on and as of such date, except to the extent such representation and
          warranties expressly related to an earlier date. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          The Borrower will be in compliance with all the terms and provisions set forth
          herein and in each other Loan Document on its part to be observed or performed,
          and at the time of and immediately after such Revolver Loan advance no Event of
          Default or Default shall have occurred and be continuing. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Each Revolver Loan advance shall be
deemed to constitute a representation and warranty by the Borrower on the date of such
Revolver Loan advance as to the matters specified in <U>clauses (b)</U> and <U>(c)</U> of
this <U>Section 5.2</U>. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5.3 <U>Conditions Precedent to All
Revolving Credit Loans</U>. No Bank shall be obligated to make any Loans nor shall any
Letter of Credit Issuer be required to issue any Letter of Credit hereunder: (i) if at
such time any Event of Default shall have occurred or any Default shall have occurred and
be continuing; (ii) if any of the representations, warranties and covenants contained in
this Agreement shall be false or untrue in any material respect on the date of such loan,
as if made on such date; or (iii) unless the Revolving Credit Borrowing Base will support
the additional Loan or Letter of Credit being requested. Each request by the Borrower for
an additional Loan shall constitute a representation by the Borrower that there is not at
the time of such request an Event of Default or a Default, and that all representations,
warranties and covenants in this Agreement are true and correct in all material respects
on and as of that date of each such request. </FONT></P>

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<A NAME=A037></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE VI  </FONT></H1>

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<A NAME=A038></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>AFFIRMATIVE COVENANTS </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each
Loan Party covenants and agrees with the Agent and each Bank that from the date hereof and
so long as this Agreement is in effect (by extension, amendment or otherwise) and until
payment in full of all Indebtedness, extinguishment of the Commitment and the performance
of all other obligations of the Loan Parties under the Loan Documents, unless the Required
Banks shall otherwise consent in writing: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.1 <U>Payment of Taxes and
Claims</U>. Each Loan Party will pay and discharge or cause to be paid and discharged all
Taxes imposed upon the income or profits of such Loan Party or upon the property, real,
personal or mixed, or upon any part thereof, belonging to such Loan Party before the same
shall be in default, and all lawful claims for labor, rentals, materials and supplies
which, if unpaid, might become a Lien upon its property or any part thereof; provided,
however, that no Loan Party shall be required to pay and discharge or cause to be paid or
discharged any such Tax, assessment or claim so long as the validity thereof shall be
contested in good faith by appropriate proceedings, and adequate book reserves shall be
established with respect thereto, and such Loan Party shall pay such Tax, charge or claim
before any property subject thereto shall become subject to levy of attachment or
execution. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.2 <U>Maintenance of Existence</U>.
Each Loan Party will do or cause to be done all things necessary to preserve and keep in
full force and effect its organizational existence, rights and franchises and good
standing in the State of Tennessee and as a foreign corporation qualified in such other
jurisdiction(s) in which the failure to maintain such qualification would have a Material
Adverse Effect and will continue to conduct and operate its business substantially as
being conducted and operated presently. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.3 <U>Preservation of Property</U>.
Each Loan Party will at all times maintain, preserve and protect all of such Loan
Party&#146;s Mortgaged Properties which are used or useful in the conduct of the its
businesses whether owned in fee or otherwise, or leased, in good repair and operating
condition; from time to time make, or cause to be made, all needful and proper repairs,
renewals, replacements, betterments and improvements thereto so that the business carried
on in connection therewith may be properly and advantageously conducted at all times; and
comply with all material leases to which it is a party or under which it occupies property
so as to prevent any material loss or forfeiture thereunder. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.4 <U>Insurance</U>. Each Loan Party
will keep or cause to be kept adequately insured by financially sound and reputable
insurers each Loan Party&#146;s property of a character usually insured by businesses
engaged in the same or similar businesses, including the Collateral. Each Loan Party shall
at all times maintain adequate insurance by financially sound and reputable insurers,
including without limitation, insurance against damage to persons and property, including
comprehensive general liability, worker&#146;s compensation and automobile liability
insurance in amounts reasonably acceptable to the Agent. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.5 <U>Compliance with Applicable
Laws</U>. Each Loan Party will comply in all material respects with the requirements of
all applicable Laws and orders of any Tribunal and obtain any licenses, permits,
franchises or other governmental authorizations necessary to the ownership of such Loan
Party&#146;s properties or to the conduct of its businesses where the failure to obtain
such licenses, permits, franchises or authorizations could reasonably be expected to have
a Material Adverse Effect. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.6 <U>Environmental Covenants</U>.
Each Loan Party will immediately notify the Agent and each Bank of, and provide the Agent
and each Bank with copies of, any notifications of discharges or releases or threatened
releases or discharges of a Polluting Substance on, upon, into or from the Collateral
which are given or required to be given by or on behalf of such Loan Party to any federal,
state or local Tribunal if any of the foregoing may materially and adversely affect any
Loan Party or any part of the Collateral, and such copies of notifications shall be
delivered to the Agent and each Bank at the same time as they are delivered to the
Tribunal. Each Loan Party further agrees promptly to undertake and diligently pursue to
completion any appropriate and legally required or authorized remedial containment and
cleanup action in the event of any release or discharge or threatened release or discharge
of a Polluting Substance on, upon, into or from the Collateral. At all times while owning
and operating the Collateral, each Loan Party will maintain and retain complete and
accurate records of all releases, discharges or other disposal of Polluting Substances on,
onto, into or from the Collateral, including, without limitation, records of the quantity
and type of any Polluting Substances disposed of on or off the Collateral. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.7 <B><U>Environmental
Indemnities</U>. Each Loan Party hereby agrees to indemnify, defend and hold harmless the
Agent, each Bank and each of their respective officers, directors, employees, agents,
consultants, attorneys, contractors and each of its affiliates, successors or assigns, or
transferees from and against, and reimburse said Persons in full with respect to, any and
all loss, liability, damage, fines, penalties, costs and expenses, of every kind and
character, including reasonable attorneys&#146; fees and court costs, known or unknown,
fixed or contingent, occasioned by or associated with any claims, demands, causes of
action, suits and/or enforcement actions, including any administrative or judicial
proceedings, and any remedial, removal or response actions ever asserted, threatened,
instituted or requested by any Persons, including any Tribunal, arising out of or related
to: (a) the breach of any representation or warranty of any Loan Party contained in
<U>Section 9.6</U> set forth herein; (b) the failure of any Loan Party to perform any of
its covenants contained in <U>Section 6.6</U> or <U>6.7</U> hereunder; (c) the ownership,
construction, occupancy, operation, use of the Collateral prior to the earlier of the date
on which (i) the Indebtedness and obligations secured hereby have been paid and performed
in full, or (ii) the Collateral has been sold by the Agent or any Bank following such
Person&#146;s ownership of the Collateral by way of foreclosure of the Liens granted
pursuant hereto, deed in lieu of such foreclosure or otherwise (the &#147;<U>Release
</U>Date&#148;); provided, however, this indemnity shall not apply with respect to matters
caused by or arising solely from the Agent, any Bank or their respective agents&#146;,
consultants&#146;, attorneys&#146; or contractors&#146; activities during any period of
time such Person acquires ownership of the Collateral.</B> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
provisions of this <U>Section 6.7</U> shall be in addition to any other obligations and
liabilities the Loan Party may have to the Agent and the Banks at common law or otherwise
hereunder and except as expressly provided for herein shall survive the Release Date and
shall continue thereafter in full force and effect. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Agent and each Bank agrees that in the event that such claim, suit or enforcement action
is asserted or threatened in writing or instituted against it or any of its officers,
employers, agents or contractors or any such remedial, removal or response action is
requested of it or any of its officers, employees, agents or contractors for which the
Agent or any Bank may desire indemnity or defense hereunder, the Agent or the applicable
Bank shall give written notification thereof to Each Loan Party. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding
anything to the contrary stated herein, the indemnities created by this <U>Section 6.7
</U>shall only apply to losses, liabilities, damages, fines, penalties, costs and expenses
actually incurred by the Agent or the applicable Bank as a result of claims, demands,
actions, suits or proceedings brought by Persons who are not the beneficiaries of any such
indemnity. Each Bank shall act as the exclusive agent for all indemnified Persons under
this <U>Section 6.7</U> who are affiliated with such Bank. With respect to any claims or
demands made by such indemnified Persons, the Agent or applicable Bank shall notify Each
Loan Party within ten (10) Business Days after the Agent&#146;s or such Bank&#146;s
receipt of a writing advising such Person of such claim or demand. Such notice shall
identify (i) when such claim or demand was first made, (ii) the identity of the Person
making it, (iii) the indemnified Person, and (iv) the substance of such claim or demand.
Failure to so notify Each Loan Party within said ten (10) Business Days shall reduce the
amount of the Loan Parties&#146; obligations and liabilities under this <U>Section 6.7</U>
by an amount equal to any damages or losses suffered by the Loan Parties resulting from
any prejudice caused the Loan Parties by such delay in notification from the Agent or such
Bank. Upon receipt of such notice, the Loan Parties shall have the exclusive right and
obligation to contest, defend, negotiate or settle any such claim or demand through
counsel of their own selection (but reasonably satisfactory to the Agent or such
applicable Bank) and solely at each Loan Parties&#146; own cost, risk and expense;
<U>provided</U>, that the Agent or the applicable Bank, at its own cost and expense shall
have the right to participate in any such contest, defense, negotiations or settlement.
The settlement of any claim or demand hereunder by any Loan Party may be made only upon
the prior approval of the Agent or the applicable Bank of the terms of the settlement,
which approval shall not be unreasonably withheld. </FONT></P>

6.8      Reporting Requirements.  The Loan Parties will furnish to the Agent and each Bank each of the following:

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.8.1 <U>Quarterly Financial
Statements</U>. As soon as available and in any event within sixty (60) days after the end
of each quarter of each fiscal year of the Borrower, commencing with the fiscal quarter
ending June 30, 2006, internally prepared interim consolidated and consolidating unaudited
balance sheets of the Borrower and its Subsidiaries as of the end of such fiscal quarter,
consolidated and consolidating statements of income and operations of the Borrower and its
Subsidiaries for the period commencing at the end of the previous fiscal year and ending
with the end of such fiscal quarter, both in sufficient detail and stating in comparative
form the respective figures for the corresponding date and period in the previous fiscal
year and certified by the Responsible Officer of the Borrower acceptable to the Agent
(subject to normal year end audit adjustments) as having been prepared in accordance with
Consistent Accounting Principles in a form consistent with and comparable to the financial
statements delivered to the Agent and each Bank pursuant to <U>Section 9.4</U>. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.8.2 <U>Annual Financial
Statements</U>. As soon as available and in any event by March&nbsp;30 of each fiscal year
of the Borrower, commencing with the fiscal year ending December 31, 2006, audited
consolidated and consolidating balance sheets of the Borrower and its Subsidiaries dated
as of the end of the immediately preceding fiscal year, audited consolidated and
consolidating statements of income and retained earnings of the Borrower and its
Subsidiaries for such preceding fiscal year, and audited consolidated and consolidating
statements of cash flow of the Borrower and its Subsidiaries for such preceding fiscal
year, in each case reported on by independent public accountants satisfactory to the
Agent, with explanatory footnotes in sufficient detail acceptable to the Agent, and
stating in comparative form the respective figures for the corresponding date and period
in the prior fiscal year and all prepared in accordance with Consistent Accounting
Principles. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.8.3 <U>Management Letters</U>.
Promptly upon and only in the event of receipt thereof, copies of any reports submitted to
the any Loan Party by independent certified public accountants in connection with
examination of the financial statements of the Borrower and its Subsidiaries made by such
accountants. </FONT></P>

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<A NAME=A039></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.8.4 Certificates. </FONT></P>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          <U>Quarterly and Annual Certificates</U>. Concurrently with the furnishing of
          the financial statements pursuant to <U>Section 6.8.1</U> and <U>Section
          6.8.2</U>, a separate certificate signed by the chief financial officer or other
          Responsible Officer of the Borrower stating that: (1) such financial statements
          were prepared (subject to year-end adjustments, in the case of quarterly
          financial statements, and without footnotes, in the case of annual financial
          statements) in conformity with Consistent Accounting Principles in a form
          consistent with and comparable to the financial statements delivered pursuant to
          <U>Section 9.4</U>; and (2) no Material Adverse Effect, Default or Event of
          Default has occurred, and is continuing, or a statement describing the nature,
          period of existence and status of any such event(s) if existing. Such
          certificates shall fully demonstrate the method of all calculations therein
          contained insofar as compliance with financial covenants hereof are concerned
          and shall not be qualified or limited because of restricted or limited
          examination of any material portion of the Loan Parties&#146; records by the
          party preparing such financial statements. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          <U>Compliance Certificate</U>. Concurrently with the furnishing of the
          certificates described in <U>Section </U> <U>6.8.4(a)</U>, a Compliance
          Certificate signed by a Responsible Officer of the Borrower. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.8.5 <U>Notice of Litigation</U>.
Promptly after the commencement thereof, notice of all actions, suits, and proceedings
before any court or governmental department, commission, board, bureau, agency, or
instrumentality, domestic or foreign, affecting any Loan Party, which, if determined
adversely to such Loan Party, could result in a liability of greater than $100,000 or
otherwise could have a Material Adverse Effect. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.8.6 <U>Notice of Defaults and
Events of Default</U>. As soon as possible and in any event within five (5) days after any
Loan Party&#146;s knowledge of the occurrence of any Material Adverse Effect, each Default
or Event of Default, a written notice setting forth the details of any such Material
Adverse Effect, such Default or Event of Default and the action which is proposed to be
taken by the Loan Parties with respect thereto. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.8.7 <U>ERISA Reports</U>. As soon
as possible, and in any event within thirty (30) days after any Loan Party knows or has
reason to know that any circumstances exist that constitute grounds entitling the PBGC to
institute proceedings to terminate a Plan subject to ERISA with respect to any Loan Party
or any Commonly Controlled Entity, and promptly but in any event within two (2) Business
Days of receipt by any Loan Party or any Commonly Controlled Entity of notice that the
PBGC intends to terminate a Plan or appoint a trustee to administer the same, and promptly
but in any event within five (5) Business Days of the receipt of notice concerning the
imposition of withdrawal liability with respect to any Loan Party or any Commonly
Controlled Entity, the Loan Parties will deliver to the Agent and the Banks a certificate
of a Responsible Officer of the Borrower setting forth all relevant details and the action
which the Loan Parties propose to take with respect thereto. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.8.8 <U>Reports to Other
Creditors</U>. Promptly after the furnishing thereof, copies of any material statement or
report furnished to any other party pursuant to the terms of any indenture, loan, credit,
or similar agreement and not otherwise required to be furnished to the Agent pursuant to
any other clause of this <U>Article VI</U>. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.8.9 <U>Proxy Statements,
Reports</U>. Promptly after the sending or filing thereof, copies of all proxy statements,
financial statements, reports, special reports and registration statements which any Loan
Party files with the Securities and Exchange Commission or any governmental authority
which may be substituted therefor or with any national securities exchange. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.8.10 <U>Reserve Reports</U>. The
Borrower shall deliver to the Agent the Reserve Reports required by <U>Section 3.2</U>. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.8.11 <U>Hedge Reports</U>.
Concurrently with the furnishing of the certificates described in
<U>Section&nbsp;6.8.4(a)</U>, commencing with the first fiscal quarter in which any Loan
Party has executed a Risk Management Agreement, a report, in form and substance
satisfactory to the Agent, setting forth as of the last Business Day of such prior fiscal
quarter end, a summary of its hedging positions under all Risk Management Agreements
(including commodity price swap agreements, forward agreements or contracts of sale which
provide for prepayment for deferred shipment or delivery of oil, gas or other commodities)
of the Loan Party, including the type, term, effective date, termination date and notional
principal amounts or volumes, the hedged price(s), interest rate(s) or exchange rates(s),
as applicable, and any new credit support agreements relating thereto not listed on
<U>Schedule 9.24</U>. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.8.12 <U>Tax Filings</U>. Promptly
after filing and in no event later than fifteen (15) days thereafter, full and complete
copies of the Loan Parties&#146; federal and state tax returns. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.8.13 <U>General Information</U>.
Such other information respecting the condition or operations, financial or otherwise, of
the Loan Parties as the Agent or any Bank may from time to time reasonably request. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.8.14 <U>Quarterly Production
Reports</U>. Concurrently with the furnishing of the certificates described in
<U>Section&nbsp;6.8.4(a)</U>, the Loan Parties shall deliver to the Agent a written report
(in form and substance reasonably acceptable to the Agent) summarizing the Loan
Parties&#146; production volumes and prices actually received for production for such
fiscal quarter. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.9 <U>Inspection</U>. Each Loan
Party will keep complete and accurate books and records with respect to the Collateral and
its other properties, business and operations and will permit employees and
representatives of the Agent or any Bank, upon reasonable notice, to audit, inspect and
examine the same and to make copies thereof and extracts therefrom during normal business
hours. All such records shall be at all times kept and maintained at the principal offices
of the Borrower. Upon any Default, the Loan Parties will surrender full and complete
copies of all of such records relating to the Collateral to the Agent upon receipt of any
request therefor from the Agent. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.10 <U>Maintenance of Employee
Benefit Plans</U>. Each Loan Party will maintain each employee benefit plan as to which
the it may have any liability or responsibility in compliance with ERISA and all other
Laws applicable thereto. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.11 <U>Notice of Claimed
Default</U>. Immediately upon becoming aware that the holder of any note or any evidence
of indebtedness or other security of any Loan Party has given notice or taken any action
with respect to a claimed default or event of default thereunder, if the amount of the
note or indebtedness exceeds $100,000, such Loan Party will give the Agent and each Bank a
written notice specifying the notice given or action taken by such holder and the nature
of the claimed default or event of default thereunder and what actions, if any, the Loan
Parties are taking and propose to take with respect thereto. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.12 <U>Change of
Directors/Management</U>. Within five (5) days after any vacancy or change in senior
management of the Borrower, including any Responsible Officer of the Borrower, the Loan
Parties shall give written notice thereof to the Agent and each Bank and a summary of the
Loan Parties&#146; plans for replacement thereof. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.13 <U>Requested Information</U>.
With reasonable promptness, the Loan Parties will give the Agent and any Bank such other
data and information relating to the Loan Parties as from time to time may be reasonably
requested by the Agent or such Bank. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.14 <U>Withholdings</U>. All
payments by any Loan Party hereunder and under any of the other Loan Documents shall be
made without set off or counterclaim and free and clear of and without deduction for any
taxes, levies, imposts, duties, charges, fees, deductions, withholdings, compulsory loans,
restrictions or conditions of any nature now or hereafter imposed or levied by any
jurisdiction or any political subdivision thereof or taxing or other authority therein
unless such Loan Party is compelled by law to make such deduction or withholding. If any
such obligation is imposed upon any Loan Party with respect to any amount payable by it
hereunder or under any of the other Loan Documents, such Loan Party will pay to the Agent
and any Bank, on the date on which such amount is due and payable hereunder or under such
other Loan Documents, such additional amount in U.S. Dollars as shall be necessary to
enable such Person to receive the same net amount which such Person would have received on
such due date had no such obligation been imposed upon such Loan Party. Each Loan Party
will deliver promptly to the Agent or any Bank certificates or other valid vouchers for
all taxes or other charges deducted from or paid with respect to payments made by such
Loan Party hereunder or under such other Loan Documents. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.15 <U>Payment of
Indebtedness/Performance of Obligations</U>. The Borrower will pay the obligations under
the Notes according to the reading, tenor and effect thereof and the Borrower hereby
agrees to pay, when due and owing, all Indebtedness, whether or not evidenced by the
Notes. </FONT></P>

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<A NAME=A040></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.16 Operation of
Properties and Equipment. </FONT></P>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Each Loan Party will maintain and operate its Mineral Interests (including the
          Mortgaged Property) in a good and workmanlike manner, and observe and comply
          with all of the terms and provisions, express or implied, of all oil and gas
          leases relating to such Mineral Interests so long as such Mineral Interests are
          capable of producing hydrocarbons and accompanying elements in paying
          quantities, except to the extent a failure to so observe and comply is not
          reasonably expected to have a Material Adverse Effect. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Each Loan Party will comply in all respects with all contracts and agreements
          applicable to or relating to its Mineral Interests or the production and sale of
          hydrocarbons and accompanying elements therefrom, except to the extent a failure
          to so comply is not reasonably expected to have a Material Adverse Effect. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Each Loan Party will maintain,
preserve and keep, at all times, all operating equipment used with respect to their
Mineral Interests in proper repair, working order and condition, and make all necessary or
appropriate repairs, renewals, replacements, additions and improvements thereto so that
the efficiency of such operating equipment shall at all times be properly preserved and
maintained; <U>provided</U> that no item of operating equipment need be so repaired,
renewed, replaced, added to or improved, if such Loan Party shall in good faith determine
that such action is not necessary or desirable for the continued efficient and profitable
operation of the business of such Loan Party. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6.17 <U>Hydrocarbon Hedge</U>. The
Borrower shall not, and shall not permit its Subsidiaries to, enter into
(a)&nbsp;Prohibited Hedge Transactions, (b) Hedge Transactions for speculative purposes or
(c)&nbsp;Hedge Transactions which, when considered together with existing Hedge
Transactions, commit the Borrower and its Subsidiaries to deliver quantities of
Hydrocarbons in excess of 75% of the aggregate volumes of Hydrocarbons projected to be
produced from proved developed producing reserves included in the Mortgaged Property for
the applicable time period(s) covered by such Hedge Transactions. </FONT></P>

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<A NAME=A041></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE VII  </FONT></H1>

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<A NAME=A042></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>NEGATIVE COVENANTS </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each
Loan Party covenants and agrees with the Agent and each Bank that from the date hereof and
so long as this Agreement is in effect (by extension, amendment or otherwise) and until
payment in full of all Indebtedness, extinguishment of the Commitment and the performance
of all other obligations of the Loan Parties under the Loan Documents, unless the Required
Banks shall otherwise consent in writing: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.1 <U>Liens</U>. No Loan Party shall
create, incur, assume, or suffer to exist any Lien, upon or with respect to any of its
properties, now owned or hereafter acquired, except: </FONT></P>

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          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Liens in favor of the Agent and Banks under the Loan Documents; </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Liens for taxes or assessments or other government charges or levies if not yet
          due and payable or, if due and payable or, if they are being contested in good
          faith by appropriate proceedings and for which appropriate reserves are
          maintained; </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Liens imposed by law, such as mechanics&#146;, materialmen&#146;s,
          landlords&#146;, warehousemen&#146;s, and carriers&#146; Liens, and other
          similar Liens, securing obligations incurred in the ordinary course of business
          which are not past due for more than thirty (30) days or which are being
          contested in good faith by appropriate proceedings and for which appropriate
          reserves have been established; </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(d)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Liens under workers&#146; compensation, unemployment insurance, Social Security,
          or similar legislation; </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(e)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Liens, deposits, or pledges to secure the performance of bids, tenders,
          contracts (other than contracts for the payment of money), leases (permitted
          under the terms of this Agreement), public or statutory obligations, surety,
          stay, appeal, indemnity, performance or other similar bonds, or other similar
          obligations arising in the ordinary course of business; </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(f)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Judgment and other similar liens (either alone or in the aggregate exceeding
          $100,000) arising in connection with court proceedings, provided the execution
          or other enforcement of such Liens is effectively stayed and the claims secured
          thereby are being actively contested in good faith and by appropriate
          proceedings; </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(g)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Easements, rights-of-way, restrictions, and other similar encumbrances which, in
          the aggregate, do not materially interfere with the occupation, use, and
          enjoyment by such Loan Party of the property or assets encumbered thereby in the
          normal course of its business or materially impair the value of the property
          subject thereto; and </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(h)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Purchase-money liens on any property hereafter acquired or the assumption of any
          lien on property existing at the time of such acquisition (and not created in
          contemplation of such acquisition), or a lien incurred in connection with any
          conditional sale or other title retention agreement; provided that (i) any
          property subject to any of the foregoing is acquired by any Loan Party in the
          ordinary course of its business; and (ii) each such lien shall attach only to
          the property so acquired and fixed improvements thereon. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

7.2      Debt.  No Loan Party shall create, incur, assume, or suffer to exist any Debt, except:

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          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Indebtedness under the Loan Documents; and </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Indebtedness created, incurred, assumed or suffered to exist in the ordinary
          course of business, as presently conducted, which are not past due and are paid
          within the specified time, unless contested in good faith and by appropriate
          proceedings, but in any event not in excess of $50,000 at any time in the
          aggregate. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.3 <U>Mergers, Consolidations</U>.
No Loan Party shall wind up, liquidate or dissolve itself, reorganize, merge or
consolidate with or into, or convey, sell, assign, transfer, lease, or otherwise dispose
of (whether in one transaction or in a series of transactions) all or substantially all of
its assets (whether now owned or hereafter acquired) to any Person. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.4 <U>Leases</U>. No Loan Party
shall create, incur, assume, or suffer to exist, any obligation as lessee for the rental
or hire of any real or personal property (other than and expressly excluding oil and gas
reserves and leasehold producing mineral interests acquired in such Loan Party&#146;s
normal business operations), except (1) leases existing on the date of this Agreement and
any extensions or renewals thereof, including such Loan Party&#146;s existing or future
lease of office space, and (2) leases (other than capital leases) which do not in the
aggregate require such Loan Party to make payments (including taxes, insurance,
maintenance, and similar expenses which such Loan Party are required to pay under the
terms of any lease) in any fiscal year of such Loan Party in excess of $50,000. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.5 <U>Sale and Leaseback</U>. No
Loan Party shall sell, transfer, or otherwise dispose of any real or personal property to
any Person and thereafter directly or indirectly rent or lease back (as lessee) the same
or similar property or any part thereof which such Loan Party intends to use for
substantially the same purpose or purposes as such property sold or transferred. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.6 <U>Dividends/Distributions</U>.
No Loan Party shall declare or pay any dividends or other distributions to any direct or
indirect beneficial owner (or Affiliate thereof) of any interest in such Loan Party other
than the Borrower; or purchase, redeem, retire, or otherwise acquire for value any of its
capital stock or other ownership interest now or hereafter outstanding; or make any
distribution of assets to their shareholders other than the Borrower as such whether in
cash, assets, or in obligations of such Loan Party; or allocate or otherwise set apart any
sum for the payment of any distribution on, or for the purchase, redemption, or retirement
of any partnership units; or make any distribution by reduction of capital or otherwise in
respect of any partnership units or interests. No Loan Party shall consent to or approve
the issuance of any additional shares of any class of capital stock or any additional
ownership interest of any issuer of Collateral, or any securities convertible into, or
exchangeable for, any such shares or ownership interest or any warrants, options, rights,
or other commitments entitling any Person to purchase or otherwise acquire any such shares
or any additional ownership interest. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.7 <U>Sale of Assets</U>. No Loan
Party shall sell, lease, assign, transfer, or otherwise dispose of, any of its now owned
or hereafter acquired assets (including, without limitation, shares of stock, receivables,
and leasehold interests), except: (1) inventory (not constituting Collateral) disposed of
or leased in the ordinary course of business; and (2) the sale or other disposition of
other assets no longer used or useful in the conduct of its business. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.8 <U>Investments</U>. No Loan Party
shall make any loan or advance to any Person, or purchase or otherwise acquire, any
capital stock, assets, obligations, or other securities of, make any capital contribution
to, or otherwise invest in or acquire any interest in any Person, or participate as a
partner or joint venturer with any other Person except: (1) as otherwise permitted herein,
(2) direct obligations of the United States or any agency thereof with maturities of one
year or less from the date of creation thereof; (3) commercial paper of a domestic issuer
rated at least Al by Standard &amp; Poors Ratings Group of P1 by Moody&#146;s Investors
Service, Inc. and maturing within 180 days of the date of creation thereof; (4) overnight
euro deposits and certificates of deposit with maturities of one year or less from the
date of creation thereof issued by the Agent, any Bank or any other commercial bank
organized under the laws of the United States or any state thereof, with a short term
deposit rating of no lower than A2 or P2, as such rating is set forth from time to time by
Standard &amp; Poors Corporation or Moody&#146;s Investors Service, Inc., respectively,
reasonably acceptable to the Agent; (5) stock, obligations, or securities received in
settlement of debts (created in the ordinary course of business) owing to such Loan Party;
(6) accounts receivable arising in the ordinary course of business; and (7) routine or
customary advances to operators or non-operator interest owners under operating agreements
entered into by any Loan Party in the ordinary course of business. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.9 <U>Guaranties</U>. No Loan Party
shall assume, guaranty, endorse, or otherwise be or become directly or contingently
responsible or liable (including, but not limited to, an agreement to purchase any
obligation, stock, assets, goods, or services, or to supply or advance any funds, assets,
goods, or services, or an agreement to maintain or cause such Person to maintain a minimum
working capital net worth, or otherwise to assure the creditors of any Person against
loss), for obligations of any Person other than the Borrower or such other Loan Party,
except guaranties by endorsement of negotiable instruments for deposits or collection or
similar transactions in the ordinary course of business. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.10 <U>Transactions with
Affiliates</U>. No Loan Party shall enter into any transaction, including, without
limitation, the purchase, sale, or exchange of property or the rendering of any service,
with any Affiliate, except in the ordinary course of and pursuant to the reasonable
requirements of such Loan Party&#146;s business and upon fair and reasonable terms no less
favorable to such Loan Party than would obtain in a comparable arm&#146;s-length
transaction with a Person not an Affiliate. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.11 <U>Change of Business</U>. No
Loan Party shall engage in any business activity substantially different from or unrelated
to its respective present business activities and operations. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.12 <U>Sale or Discount of
Receivables</U>. No Loan Party shall sell (with or without recourse), discount (other than
to the extent of finance and interest charges included therein) or otherwise sell any of
its notes or accounts receivable, except notes or accounts receivable the collection of
which is doubtful in accordance with Consistent Accounting Principles. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.13 <U>Other
Agreements/Amendments</U>. No Loan Party shall enter into or permit to exist any agreement
(i) which would cause an Event of Default or a Default hereunder; or (ii) which contains
any provision which would be violated or breached by the performance of such Loan
Party&#146;s obligations hereunder or under any of the other Loan Documents. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.14 <U>Prepayment of
Indebtedness</U>. No Loan Party shall make or agree to pay or make, directly or
indirectly, any payment or other distribution (whether in cash, securities or other
property) of or in respect of principal of or interest on any Debt, or any payment or
other distribution (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 Indebtedness, except: </FONT></P>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          payment of Indebtedness; and </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          payment of secured Indebtedness that becomes due as a result of the voluntary
          sale or transfer of the property or assets securing such Indebtedness. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.15 <U>Use of Loan Proceeds</U>. The
Borrower shall not use any proceeds of any Loan advance request or Letter of Credit
issuance request under the Commitment for any purpose other than those expressly permitted
and contemplated by this Agreement, and in no event shall any loan proceeds be used for
any purpose that would create or cause a breach, violation or default or event of default
hereunder or under any of the other Loan Documents (including the Security Instruments) or
violation of Regulations T, U or X or any other regulation of the Board of Governors of
the Federal Reserve System or to violate Section 7 of the Securities Exchange Act of 1934
or any rule or regulation thereunder, in each case as now in effect or as the same may
hereinafter be in effect. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.16 <U>Subsidiaries</U>. No Loan
Party shall create any domestic Subsidiary unless, contemporaneously therewith, such
domestic Subsidiary executes and delivers to the Agent, for the benefit of the Banks, a
joinder to the Subsidiary Guaranty Agreement. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7.17 <U>Fiscal Year; Corporate
Changes</U>. The Borrower will not change its fiscal year end from the present fiscal year
end of December&nbsp;31. No Loan Party shall change its name, principal place of business
or jurisdiction of organization in any manner that might make any financing statement
filed in connection with this Agreement seriously misleading unless it shall have given
the Agent thirty (30) days prior written notice thereof and shall have taken all action
reasonably deemed necessary or desirable by the Agent to protect the Agent&#146;s security
interest in the Collateral with the perfection and priority thereof required by the Loan
Documents. </FONT></P>

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<A NAME=A043></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE VIII  </FONT></H1>

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<A NAME=A044></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>FINANCIAL COVENANTS </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8.1 <U>Current Ratio</U>. The
Borrower will not permit the ratio of Consolidated Current Assets to Consolidated Current
Liabilities calculated at the end of any fiscal quarter to be less than 1.00 to 1.00. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8.2 <U>Leverage Ratio</U>. The
Borrower will not permit the Leverage Ratio to be more than 2.00 to 1.00. As used in
herein, &#147;<U>Leverage Ratio</U>&#148; means, on any date, the ratio of: (a) the
aggregate principal amount of all Indebtedness of the Borrower and its Subsidiaries at
such date, determined on a consolidated basis in accordance with Consistent Accounting
Principles, to (b) EBITDA for the period of four consecutive fiscal quarters ended on such
date (or, if such date is not the last day of a fiscal quarter, ended on the last day of
the fiscal quarter most recently ended prior to such date). </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8.3 <U>Interest Coverage Ratio</U>.
The Borrower will not permit the Interest Coverage Ratio to be less than 5.00 to 1.00. As
used in herein, &#147;<U>Interest Coverage Ratio</U>&#148; means, on any date, the ratio
of: (a) EBITDA to (b) total Interest Expense of the Borrower and its Subsidiaries, in each
case calculated on a consolidated basis for the Borrower and its Subsidiaries for the
period of four consecutive fiscal quarters ended on such date (or, if such date is not the
last day of a fiscal quarter, ended on the last day of the fiscal quarter most recently
ended prior to such date) in accordance with Consistent Accounting Principles. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8.4 <U>General and Administrative
Expenses</U>. The Loan Parties shall not incur or make any general and administrative
expenses (specifically excluding non-cash expenses (e.g., non-cash expenses related to
stock option and warrant issuances) but specifically including cash payments made by such
Person for the purpose of funding any such expense) in an aggregate amount in any fiscal
quarter exceeding (a)&nbsp;ten percent (10%) of the Loan Parties&#146; positive
consolidated revenue calculated for the immediately preceding fiscal quarter at any time
that the Loan Parties&#146; Leverage Ratio is more than 1.50 to 1.00 or (b)&nbsp;twenty
percent (20%) of the Loan Parties&#146; positive consolidated revenue calculated for the
immediately preceding fiscal quarter at any time. </FONT></P>

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<A NAME=A045></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE IX  </FONT></H1>

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<A NAME=A046></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>REPRESENTATIONS AND
WARRANTIES </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;To
induce the Agent and the Banks to enter into this Agreement and to make the Loans to the
Borrower under the provisions hereof, and in consideration thereof, each Loan Party
represents, warrants and covenants as follows: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.1 <U>Good Standing, and Due
Qualification</U>. Each Loan Party (a) is a corporation duly formed, validly existing, and
in good standing under the laws of the State of Tennessee; (b) has the power and authority
to own its assets and to transact the business in which it is now engaged or proposed to
be engaged in; and (c) is duly qualified as a foreign corporation and in good standing
under the laws of each other jurisdiction in which such qualification is required, except
where the failure to so qualify could not reasonably be expected to have a Material
Adverse Effect. The Responsible Officer of the Borrower, has all necessary corporate power
and authority to execute and deliver this Agreement, the Notes, the Security Instruments
and the other Loan Documents to the Agent. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.2 <U>Litigation</U>. Except as set
forth on <U>Schedule 9.2</U> attached hereto, there is no action, suit, investigation or
proceeding threatened or pending before any Tribunal against or affecting any Loan Party
or any properties or rights of such Loan Party, which, if adversely determined, would
result in any material adverse change in the business or condition, financial or
otherwise, of such Loan Party, or otherwise materially adversely affect the ability of any
Loan Party to perform its obligations under this Agreement. No Loan Party is in default
with respect to any judgment, order, writ, injunction, decree, rule or regulation of any
Tribunal. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.3 <U>Conflicting Agreements and
Other Matters</U>. No Loan Party is in default in the performance of any material
obligation, covenant, or condition in any material agreement to which it is a party or by
which it is bound. No Loan Party is a party to any contract or agreement or subject to any
charter or other partnership restriction which materially and adversely affects its
business, property or assets, or financial condition. No Loan Party is a party to or
otherwise subject to any contract or agreement which restricts or otherwise affects the
right or ability of such Loan Party to execute the Loan Documents to which such Loan Party
is a party or the performance of any of their respective terms. Neither the execution nor
delivery of any of the Loan Documents to which such Loan Party is a party, nor fulfillment
of nor compliance with their respective terms and provisions will conflict with, or result
in a material breach of the terms, conditions or provisions of, or constitute a default
under, or result in any material violation of, or result in the creation of any Lien
(except those created by the Loan Documents) upon any of the properties or assets of any
Loan Party pursuant to, or require any consent, approval or other action by or any notice
to or filing with any Tribunal (other than routine filings after the Closing Date with the
Securities and Exchange Commission, any securities exchange and/or state blue sky
authorities) pursuant to any award of any arbitrator, or any agreement, instrument or Law
to which any Loan Party is subject. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.4 <U>Financial
Statements/Condition</U>. The financial statements of the Loan Parties as of
March&nbsp;31, 2006 are full and complete copies of which have been furnished to the Agent
and the Banks, are complete and correct and fairly present the financial condition of the
Loan Parties in all material respects at such dates and the results of the operations of
the Loan Parties for the periods covered by such statements, all in accordance with
Consistent Accounting Principles, and since March&nbsp;31, 2006 , there has been no
Material Adverse Effect or material adverse change in the condition (financial or
otherwise), business, or operations of the Loan Parties. There are no liabilities of the
Loan Parties, fixed or contingent, which are material but not reflected in such financial
statements or in the notes thereto, other than liabilities arising in the ordinary course
of business since March&nbsp;31, 2006 . No information, exhibit, or report furnished by
any Loan Party to the Agent or any Bank in connection with the negotiation of this
Agreement contains any material misstatement of fact. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.5 <U>Title to Properties,
Authority</U>. Each Loan Party has full power, authority and legal right to own and
operate the properties which it now owns and operates, and to carry on the lines of
business in which it is now engaged, and has good and defensible title to all of its
assets, including all Collateral, subject to no Lien of any kind except Liens permitted by
this Agreement. Each Loan Party has full power, authority and legal right to execute and
deliver and to perform and observe the provisions of the Loan Documents to which it is a
party and such Loan Documents constitute the legal, valid and binding obligations of such
Loan Party, enforceable against it in accordance with their respective terms, subject only
to applicable bankruptcy, insolvency or similar laws and general principles of equity. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.6 <U>Environment</U>. Each Loan
Party has duly complied in all material respects with, and its business, operations,
assets, equipment, property, leaseholds, or other facilities are in compliance with, the
provisions of all federal, state, and local environmental, health, and safety laws, codes
and ordinances, and all rules and regulations promulgated thereunder. Each Loan Party has
been issued and will maintain all required federal, state, and local permits, licenses,
certificates, and approvals relating to (i) air emissions; (ii) discharges to surface or
groundwater; (iii) noise emissions; (iv) solid or liquid waste disposal; (v) the use,
generation, storage, transportation, or disposal of toxic or hazardous substances or
wastes (intended hereby and hereafter to include any and all such materials listed in any
federal, state, or local law, code or ordinance, and all rules and regulations promulgated
thereunder as hazardous or potentially hazardous); or (vi) other environmental, health, or
safety matters. Except as previously disclosed to the Agent and the Banks in writing, no
Loan Party has received notice of, nor to its best knowledge knows of or suspects, facts
which might constitute any violations of any federal, state or local environmental,
health, or safety laws, codes or ordinances, and any rules or regulations promulgated
thereunder with respect to its business, operations, assets, equipment, property,
leaseholds, or other facilities. There has been no complaint, order, directive, claim,
citation, or notice by any governmental authority or to the best of such Loan Party&#146;s
knowledge any person or entity with respect to (i) air emissions; (ii) spills, releases,
or discharges to soils or improvements located thereon, surface water, groundwater or the
sewer, septic system or waste treatment, storage or disposal systems servicing the
premises; (iii) noise emissions; (iv) solid or liquid waste disposal; (v) the use,
generation, storage, transportation, or disposal of toxic or hazardous substances or
waste; or (vii) other environmental health, or safety matters affecting such Loan Party or
its business, operations, assets, equipment, property, leaseholds, or other facilities. No
Loan Party has any indebtedness, obligation, or liability, absolute or contingent, matured
or not matured, with respect to the storage, treatment, cleanup, or disposal of any solid
wastes, hazardous wastes, or other toxic or hazardous substances (including without
limitation any such indebtedness, obligation, or liability with respect to any current
regulation, law, or statute regarding such storage, treatment, cleanup, or disposal). </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.7 <U>Purposes</U>. No Loan Party is
engaged principally, or as one of its important activities, in the business of extending
credit for the purpose of purchasing or carrying margin stock (within the meaning of
Regulation U of the Board of Governors of the Federal Reserve System) and no part of the
proceeds of any borrowing hereunder will be used to purchase or carry any margin stock or
to extend credit to others for the purpose of purchasing or carrying any margin stock. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.8 <U>Compliance with Applicable
Laws</U>. Each Loan Party is in compliance in all material respects with all Laws,
ordinances, rules, regulations and other legal requirements applicable to it and the
business conducted thereby. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.9 <U>Possession of Franchises,
Licenses</U>. Each Loan Party has in its possession all franchises, certificates,
licenses, permits and other authorizations from governmental political subdivisions or
regulatory authorities that are necessary in any material respect for the ownership,
maintenance and operation of its properties and assets, and such Loan Party is not in
violation in any material respect thereof. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.10 <U>Leases, Easements and Rights
of Way</U>. Each Loan Party enjoys peaceful and undisturbed possession of all leases,
easements and rights of way necessary in any material respect for the operation of their
respective properties and assets, none of which contains any unusual or burdensome
provisions which might materially affect or impair the operation of such properties and
assets. All such leases, easements and rights of way are valid and subsisting and are in
full force and effect. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.11 <U>Taxes</U>. All Tax
liabilities of each Loan Party are adequately provided for on the books of such Loan
Party, including any interest or penalties. No income tax liability of a material nature
has been asserted by taxing authorities for Taxes in excess of those already paid. </FONT></P>

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<A NAME=A047></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.12 [Intentionally
Omitted.] </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.13 <U>ERISA</U>. Since the
effective date of Title IV of ERISA, no Reportable Event has occurred with respect to any
Plan. For the purposes of this section the term Reportable Event shall mean an event
described in Section 4043(b) of ERISA. For the purposes hereof the term Plan shall mean
any plan subject to Title IV of ERISA and maintained for employees of any Loan Party, or
of any member of a controlled group of corporations, as the term controlled group of
corporations is defined in Section 1563 of the Internal Revenue Code of 1986, as amended
(the &#147;<U>Code</U>&#148;), of which it is a part. Each Plan established or maintained
by each Loan Party is in material compliance with the applicable provisions of ERISA, and
it has filed all reports required by ERISA and the Code to be filed with respect to each
Plan. Each Loan Party has met all requirements with respect to funding Plans imposed by
ERISA or the Code. Since the effective date of Title IV of ERISA there have not been any
nor are there now existing any events or conditions that would permit any Plan to be
terminated under circumstances which would cause the lien provided under Section 4068 of
ERISA to attach to the assets of such Loan Party. The value of each Plan&#146;s benefits
guaranteed under Title IV of ERISA on the date hereof does not exceed the value of such
Plan&#146;s assets allocable to such benefits on the date hereof. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.14 <U>Tax Related Liens</U>. No
federal or state tax liens or notices pertaining to assessments of federal or state taxes
or other liens have been filed against any Loan Party or any assets thereof including,
without limitation, any assessment notices or liens filed pursuant to 26 U.S.C. &sect;
6323 arising out of or in connection with ERISA nor has the Pension Benefit Guaranty
Corporation filed or asserted any lien or claims against any Loan Party by virtue of
Section 4068 of ERISA or otherwise. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.15 <U>Corporate Authorization</U>.
The Board of Directors or similar governing body of each Loan Party have duly authorized
the execution and delivery of each of the Loan Documents to which such Loan Party is a
party and the performance of their respective terms. No other authorizations, approvals,
consents or actions of any other Person, except for the Agent and the Banks, is required
as a prerequisite to the validity and enforceability of the Loan Documents. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.16 <U>Investment Company Act
Representation</U>. No Loan Party is an investment company or a company controlled by an
investment company, within the meaning of the Investment Company Act of 1940, as amended. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.17 <U>Production Sales
Contracts</U>. All material contracts, agreements and leases related to any of the Mineral
Interests and all material production sales contracts, agreements, instruments and leases
to which any Loan Party is a party, are valid and effective in accordance with their
respective terms, and all material agreements affecting the Mineral Interests in the
nature of production purchase agreements, and gas sale agreements are in full force and
effect and are valid and legally binding obligations of the parties thereto and all
payments due thereunder have been made, except for those suspended for reasonable cause in
the ordinary course of business; and, there is not under any such contract, agreement or
lease any existing default by any party thereto or any event which, with notice or lapse
of time, or both, would constitute such default thereunder or, as to any other contracts,
would constitute such default, other than minor defaults which, in the aggregate, would
result in losses or damages of more than $100,000 to any Loan Party. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.18 <U>Take or Pay Obligations,
Prepayments, BTU Adjustments and Balancing Problem</U>. There is no take or pay obligation
under any gas purchase agreement comprising a portion of the Collateral which is not
matched by a commensurate and corresponding pay or take obligation binding upon the
purchaser under a corresponding gas sales agreement such that with respect to the
ownership and operation of the businesses of any Loan Party or the Collateral, any such
obligation in favor of any seller under any gas purchase agreement to which such Loan
Party is a buyer is matched by a corresponding obligation on the part of purchasers under
corresponding gas sales agreements pursuant to which such Loan Party is the seller. No
Loan Party nor the Collateral is subject to requirements to make BTU adjustments or effect
gas balancing in favor of third parties which would result in any Loan Party being
required to (i) deliver gas at a price below that established in applicable gas sales
agreements, or (ii) balance in kind by allowing other owners in the Collateral to make up
the past imbalances in gas sales, or (iii) balance in cash by paying other owners of the
collateral for the past gas imbalances except for the matters which have been disclosed in
writing to the Agent and the Banks prior to the Closing Date. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.19 <U>Gas Purchase Obligations in
Excess of Gas Sales Rights</U>. The ownership and operation of the business operations of
the Loan Parties or the Collateral have not resulted and will not result in the existence
of minimum purchase obligations under any gas purchase agreement (relating to the volume
of gas to be taken thereunder or the price to be paid with respect thereto for the
duration of any such gas purchase agreement) which are not matched by corresponding and
commensurate rights to sell all such gas under applicable gas sales agreements at prices
in excess of the amount to be paid therefor under gas purchase agreements (without regard
to costs associated with transporting any such gas and risks of volume shrinkage occurring
in the transportation process). </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.20 <U>Public Utility Holding
Company Act, Federal Power Act, Interstate Commerce Act; Other Regulation</U>. No Loan
Party is subject to regulation under the Public Utilities Holding Company Act of 1935, as
amended, the Federal Power Act, as amended, the Interstate Commerce Act, as amended, any
state public utilities code, as amended from time to time, or any other federal or state
statute or regulation, as amended from time to time, which limits the ability of such Loan
Party to perform its respective obligations under the Loan Documents to which it is a
party. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.21 <U>No Material
Misstatements</U>. No written information, statement, exhibit, certificate, document or
report furnished to the Agent or any Bank by any Loan Party in connection with the
negotiation of this Agreement contained any material misstatement of fact or omitted to
state a material fact or any fact necessary to make the statement contained therein not
materially misleading in the light of the circumstances in which made. There is no fact
known any Loan Party which has a Material Adverse Effect or in the future is reasonably
likely to have a Material Adverse Effect and which has not been set forth in this
Agreement or the other documents, certificates and statements furnished to the Agent or
any Bank by or on behalf of such Loan Party prior to, or on, the Closing Date in
connection with the transactions contemplated hereby. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.22 <U>Location of Business and
Offices</U>. Each Loan Party&#146;s principal place of business and chief executive office
is located at the address stated in <U>Section 11.1</U>. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.23 <U>Solvency</U>. No Loan Party
(i) is insolvent as of the date hereof and will not be rendered insolvent as a result of
this Agreement, (ii) is engaged in business or a transaction, or about to engage in a
business or a transaction, for which any Property or assets remaining with it is
unreasonably small capital, and (iii) intends to incur, or believes it will incur, debts
that will be beyond its ability to pay as such debts mature. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.24 <U>Risk Management
Agreement</U>. <U>Schedule 9.24</U> sets forth, as of the Closing Date, a true and
complete list of all Risk Management Agreements (including commodity price swap
agreements, forward agreements or contracts of sale which provide for prepayment for
deferred shipment or delivery of oil, gas or other commodities) of any Loan Party, the
material terms thereof (including the type, term, effective date, termination date and
notional amounts or volumes), the net mark to market value thereof, all credit support
agreements relating thereto (including any margin required or supplied), and the
counter-party to each such agreement. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9.25 <U>Subsidiaries</U>. No Loan
Party has any Subsidiaries other than as set forth on <U>Schedule&nbsp;9.25</U> hereto.
<U>Schedule 9.25</U> hereto accurately reflects the ownership percentage of the Borrower
in the Collateral consisting of its ownership interest in its Subsidiaries and the
Borrower&#146;s ownership percentage is not subject to dilution. </FONT></P>

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<A NAME=A048></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE X  </FONT></H1>

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<A NAME=A049></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>EVENTS OF DEFAULT </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10.1 <U>Events of Default</U>. The
occurrence of any one or more of the following events shall constitute an Event of Default
(whether such occurrence shall be voluntary or involuntary or come about or be effected by
operation of Law or otherwise): </FONT></P>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          the Borrower shall fail to make any payment under the Notes or any reimbursement
          obligation in respect of any Letter of Credit or any other cost, expense or fee
          arising under or in connection with the Loan documents when and as the same
          shall become due and payable, whether at the due date thereof or at a date fixed
          for prepayment thereof or otherwise; or </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Any representation, warranty or certification of any Loan Party made herein, in
          the Security Instruments or in any other writing furnished in connection with or
          pursuant to nay of the Loan Documents shall have been incorrect, false or
          misleading in any material respect on the date when made; or </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          (i) any Loan Party shall fail to observe or perform any covenant, condition or
          agreement contained in <U>Section 6.4</U>, <U>Section 6.9</U>, <U>Article IX</U>
          or this <U>Article X</U>, or (ii) any Loan Party shall fail to observe or
          perform any other covenant, condition or agreement contained in Agreement and
          such failure shall continue unremedied for a period of 15 days after the earlier
          of such breach or notice thereof from the Agent (which notice will be given at
          the request of any Bank); or </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(d)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Any Loan Party shall default in the payment of principal or of interest on any
          other material obligation for money borrowed or received as an advance (or any
          obligation under any conditional sale or other title retention agreement, or any
          obligation issued or assumed as full or partial payment for property whether or
          not secured by purchase money Lien, or aggregating $50,000 or more on any
          obligation under notes payable or drafts accepted representing extensions of
          credit) beyond any applicable grace or curative period provided with respect
          thereto, or shall default in the performance of any other agreement, term or
          condition contained in any agreement under which such obligation is created (or
          if any other default under any such agreement shall occur and be continuing
          beyond any period of grace provided with respect thereto) if the effect of such
          default is to cause, or to permit the holder or holders of such obligation (or a
          trustee on behalf of such holder or holders) to cause such obligation in an
          amount aggregating $50,000 or more to become due prior to its date of maturity;
          or </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(e)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Any of the following: (i) any Loan Party shall be unable to pay its debts as
          they mature, or shall make an assignment for the benefit of creditors or admit
          in writing its inability to pay its debts generally as they become due or fail
          generally to pay its debts as they mature; or (ii) an order, judgment or decree
          is entered adjudicating any Loan Party insolvent or an order for relief under
          the United States Bankruptcy Code is entered with respect to any Loan Party; or
          (iii) any Loan Party shall petition or apply to any Tribunal for the appointment
          of a trustee, receiver, custodian or liquidator of such Loan Party or of any
          substantial part of the assets of such Loan Party or shall commence any
          proceedings relating to any Loan Party under any bankruptcy, reorganization,
          compromise, arrangement, insolvency, readjustment of debts, dissolution, or
          liquidation Law of any jurisdiction, whether now or hereafter in effect; or (iv)
          any such petition or application shall be filed, or any such proceedings shall
          be commenced, against any Loan Party and it by any act shall indicate its
          approval thereof, consent thereto or acquiescence therein, or an order, judgment
          or decree shall be entered appointing any such trustee, receiver, custodian or
          liquidator, or approving the petition in any such proceedings, and such order,
          judgment or decree shall remain unstayed and in effect for more than thirty (30)
          days; or (v) any Loan Party shall fail to make timely payment or deposit of any
          amount of tax required to be withheld by such Loan Party and paid to or
          deposited to or to the credit of the United States of America pursuant to the
          provisions of the Internal Revenue Code of 1986, as amended, in respect of any
          and all wages and salaries paid to employees of such Loan Party; or </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(f)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Any final judgment on the merits for the payment of money in an amount in excess
          of $100,000 shall be outstanding against any Loan Party and such judgment shall
          remain undischarged, unstayed and in effect and unpaid for more than thirty (30)
          days; or </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(g)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Any Reportable Event described in <U>Sections 6.8.7</U> or <U>9.13</U> hereof
          which the Agent determines in good faith might constitute grounds for the
          termination of a Plan therein described or for the appointment by the
          appropriate United States District Court of a trustee to administer any such
          Plan shall have occurred and be continuing thirty (30) days after written notice
          to such effect shall have been given to any Loan Party or the Agent, or any such
          Plan shall be terminated, or a trustee shall be appointed by an appropriate
          United States District Court to administer any such Plan or the Pension Benefit
          Guaranty Corporation shall institute proceedings to terminate any such Plan or
          to appoint a trustee to administer any such Plan or such Reportable Event or
          condition could subject any Loan Party to any tax, penalty or other liability
          which in the aggregate may exceed $100,000; or </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(h)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          The Security Instruments after delivery thereof shall for any reason, except to
          the extent permitted by the terms thereof, cease to be in full force and effect
          and valid, binding and enforceable in accordance with their terms, or cease to
          create a valid and perfected Lien of the priority required thereby on any of the
          collateral purported to be covered thereby, except to the extent permitted by
          the terms of this Agreement; or </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(i)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Any default or event of default under any of the other Loan Documents following
          the lapse of any applicable curative or grace period provided therein; or </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(j)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Any Change in Control occurs. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10.2 <U>Remedies</U>. Upon the
occurrence of any Event of Default referred to in <U>Section 10.1(e)</U>, the Commitment
shall, at the option of the Agent or at the direction of the Required Banks, immediately
terminate and the Notes and all other Indebtedness owing under the Loan Documents shall be
immediately due and payable, without notice of any kind. Upon the occurrence of any other
Event of Default, and without prejudice to any right or remedy of the Agent or any Bank
under this Agreement or the Loan Documents or under applicable Law or under any other
instrument or document delivered in connection herewith, the Agent may, or at the
direction of the Required Banks, shall, (i) declare the Commitment terminated or (ii)
declare the Commitment terminated and declare the Notes and the other Indebtedness owing
under the Loan Documents, or any part thereof, to be forthwith due and payable, whereupon
the Notes and the other Indebtedness, or such portion as is designated by the Agent shall
forthwith become due and payable, without presentment, demand, notice or protest of any
kind, all of which are hereby expressly waived by each Loan Party. No delay or omission on
the part of the Agent or the Banks in exercising any power or right hereunder or under the
Notes, the Loan Documents or under applicable law shall impair such right or power or be
construed to be a waiver of any default or any acquiescence therein, nor shall any single
or partial exercise by the Agent or any Bank of any such power or right preclude other or
further exercise thereof or the exercise of any other such power or right by such Person.
In the event that all or part of the Indebtedness becomes or is declared to be forthwith
due and payable as herein provided, the Agent and each Bank shall have the right to set
off the amount of all the Indebtedness of the Borrower (or any of its Subsidiaries or
Affiliates) owing to such Person (or any Affiliate of such Person) against, and shall have
a lien upon and security interest in, all property of the Borrower in such Person&#146;s
possession at or subsequent to such default, regardless of the capacity in which such
property is held, including but not limited to any balance or share of any deposit,
demand, collection or agency account. At any time after the occurrence of any Event of
Default, the Agent may, at its option, or shall, at the direction of the Required Banks,
cause an audit of any and/or all of the books, records and documents of the Loan Parties
to be made by auditors satisfactory to the Agent at the expense of the Loan Parties. The
Agent and each Bank also shall have, and may exercise, each and every right and remedy
granted to it for default under law and the terms of the other Loan Documents. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10.3 <U>Actions in Respect of the
Letters of Credit Upon Default</U>. If any Event of Default shall have occurred and be
continuing, the Agent may make demand upon the Borrower to, and forthwith upon such demand
the Borrower will, pay to the Agent for the benefit of the Banks in same day funds at the
Agent&#146;s office designated in such demand, for deposit in a special letter of credit
collection account with the Agent (the &#147;<U>L/C Cash Collateral Account</U>&#148;), an
amount equal to the aggregate available unfunded amount of all Letters of Credit then
outstanding. If at any time the Agent determines that any funds held in the L/C Cash
Collateral Account are subject to any right or claim of any Person other than the Agent or
that the total amount of such funds is less than the aggregate available unfunded amount
of all Letters of Credit, the Borrower will, forthwith upon demand by the Agent, pay to
the Agent, as additional funds to be deposited and held in the L/C Cash Collateral
Account, an amount equal to the excess of (a) such aggregate available unfunded amount
thereof over (b) the total amount of funds, if any, then held in the L/C Cash Collateral
Account that the Agent determines to be free and clear of any such right and claim. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10.4 <U>Application of Proceeds</U>.
After the exercise of remedies provided for in <U>Section 10.2</U> (or after the
Indebtedness automatically becomes immediately due and payable as set forth in <U>Section
10.2</U>), any amounts received on account of such Indebtedness shall be applied in the
following order: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>First</U>:
to payment of that portion of the Indebtedness constituting fees, indemnities, expenses or
other amounts (other than principal and interest) payable to the Agent and its Affiliates
(including fees, charges and disbursements of counsel) ratably among them in proportion to
the amounts described in this clause First payable to them; </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Second</U>:
to payment of accrued and unpaid interest on the Indebtedness, ratably among the Agent and
the Banks and the Banks&#146; Affiliates in proportion to the respective amounts described
in this clause Second payable to them; </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Third</U>:
to payment of unpaid principal of the Indebtedness, ratably among the Agent, the Banks and
the Banks&#146; Affiliates in proportion to the respective amounts described in this
clause Third held by them; </FONT></P>

                  Fourth:  to  serve  as cash  collateral  to be held by the  Agent  to  secure  Letter  of  Credit
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<A NAME=A050></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Exposure: and </FONT></P>

                  Last: the balance,  if any, after all of the Indebtedness has been  indefeasibly paid in full, to
the Borrower or as otherwise required by applicable Laws.

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<A NAME=A051></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE XI  </FONT></H1>

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<A NAME=A052></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>AGENCY PROVISIONS </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each
of the Banks and the Letter of Credit Issuer hereby irrevocably appoints the Agent as its
agent and authorizes the Agent to take such actions on its behalf, including execution of
the other Loan Documents, and to exercise such powers as are delegated to the Agent by the
terms of the Loan Documents, together with such actions and powers as are reasonably
incidental thereto. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
bank serving as the Agent hereunder shall have the same rights and powers in its capacity
as a Bank as any other Bank and may exercise the same as though it were not the Agent, and
such bank and its Affiliates may accept deposits from, lend money to and generally engage
in any kind of business with any Loan Party or other Affiliate thereof as if it were not
the Agent hereunder. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Agent shall not have any duties or obligations except those expressly set forth in the
Loan Documents. Without limiting the generality of the foregoing, (a) the Agent shall not
be subject to any fiduciary or other implied duties, regardless of whether a Default has
occurred and is continuing, (b) the Agent shall not have any duty to take any
discretionary action or exercise any discretionary powers, except discretionary rights and
powers expressly contemplated by the Loan Documents that the Agent is required to exercise
in writing as directed by the Required Banks, and (c) except as expressly set forth in the
Loan Documents, the Agent shall not have any duty to disclose, and shall not be liable for
the failure to disclose, any information relating to any Loan Party that is communicated
to or obtained by the bank serving as the Agent or any of its Affiliates in any capacity.
The Agent shall not be liable for any action taken or not taken by it with the consent or
at the request of the Required Banks or in the absence of its own gross negligence or
willful misconduct. The Agent shall be deemed not to have knowledge of any Default unless
and until written notice thereof is given to the Agent by any Loan Party or a Bank, and
the Agent shall not be responsible for or have any duty to ascertain or inquire into (i)
any statement, warranty or representation made in or in connection with any Loan Document,
(ii) the contents of any certificate, report or other document delivered hereunder or in
connection with any Loan Document, (iii) the performance or observance of any of the
covenants, agreements or other terms or conditions set forth in any Loan Document, (iv)
the validity, enforceability, effectiveness or genuineness of any Loan Document or any
other agreement, instrument or document, (v) the creation, perfection or priority of Liens
on the Collateral or the existence of the Collateral, or (vi) the satisfaction of any
condition set forth in <U>Article V </U>or elsewhere in any Loan Document, other than to
confirm receipt of items expressly required to be delivered to the Agent. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Agent shall be entitled to rely upon, and shall not incur any liability for relying upon,
any notice, request, certificate, consent, statement, instrument, document or other
writing believed by it to be genuine and to have been signed or sent by the proper Person.
The Agent also may rely upon any statement made to it orally or by telephone and believed
by it to be made by the proper Person, and shall not incur any liability for relying
thereon. The Agent may consult with legal counsel, independent accountants and other
experts selected by it, and shall not be liable for any action taken or not taken by it in
accordance with the advice of any such counsel, accountants or experts. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Banks hereby agree to indemnify the Agent from and hold the Agent harmless against (to the
extent not reimbursed under <U>Sections 12.9</U> and <U>12.10</U>, but without limiting
the obligations of any Loan Party hereunder), ratably in accordance with their respective
Commitments, any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, deficiencies, suits, costs, expenses (including attorneys&#146; fees), and
disbursements of any kind or nature whatsoever which may be imposed on, incurred by, or
asserted against the Agent in any way relating to or arising out of any of the Loan
Documents or any action taken or omitted to be taken by the Agent under or in respect of
any of the Loan Documents; provided, further, that no Bank shall be liable for any portion
of the foregoing to the extent caused by the Agent&#146;s gross negligence or willful
misconduct. Without limitation of the foregoing, it is the express intention of the Banks
that the Agent shall be indemnified hereunder from and held harmless against all of such
liabilities, obligations, losses, damages, penalties, actions, judgments, deficiencies,
suits, costs, expenses (including attorneys&#146; fees), and disbursements of any kind or
nature directly or indirectly arising out of or resulting from the sole or contributory
negligence of the Agent. Without limiting any other provision of this Section, each Bank
agrees to reimburse the Agent promptly upon demand for its pro rata share (calculated on
the basis of the Commitments) of any and all out of-pocket expenses (including
attorneys&#146; fees) incurred by the Agent in connection with the preparation, execution,
delivery, administration, modification, amendment or enforcement (whether through
negotiations, legal proceedings, or otherwise) of, or legal advice in respect of rights or
responsibilities under, the Loan Documents, to the extent that the Agent is not reimbursed
for such expenses by the Loan Parties. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Agent may perform any and all its duties and exercise its rights and powers by or through
any one or more sub-agents appointed by the Agent. The Agent and any such sub-agent may
perform any and all its duties and exercise its rights and powers through their respective
Affiliates and the respective directors, officers, employees, agents and advisors of such
Persons and such Persons&#146; Affiliates (collectively &#147;<U>Related
Parties</U>&#148;). The exculpatory provisions of the preceding paragraphs shall apply to
any such sub-agent and to the Related Parties of the Agent and any such sub-agent, and
shall apply to their respective activities in connection with the syndication of the
credit facilities provided for herein as well as activities as the Agent. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Subject
to the appointment and acceptance of a successor the Agent as provided in this paragraph,
the Agent may resign at any time by notifying the Banks, the Letter of Credit Issuer and
the Borrower. Upon any such resignation, the Required Banks shall have the right, in
consultation with the Borrower, to appoint a successor. If no successor shall have been so
appointed by the Required Banks and shall have accepted such appointment within 30 days
after the retiring the Agent gives notice of its resignation, then the retiring the Agent
may, on behalf of the Banks and the Letter of Credit Issuer, appoint a successor the Agent
which shall be a commercial bank or an Affiliate of any such commercial bank. Upon the
acceptance of its appointment as the Agent hereunder by a successor, such successor shall
succeed to and become vested with all the rights, powers, privileges and duties of the
retiring the Agent, and the retiring the Agent shall be discharged from its duties and
obligations hereunder. The fees payable by the Borrower to a successor the Agent shall be
the same as those payable to its predecessor unless otherwise agreed between the Borrower
and such successor. After the Agent&#146;s resignation hereunder, the provisions of this
Article, <U>Section 12.9</U>, and <U>Section 12.10</U> shall continue in effect for the
benefit of such retiring the Agent, its sub agents and their respective Related Parties in
respect of any actions taken or omitted to be taken by any of them while it was acting as
the Agent. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each
Bank acknowledges that it has, independently and without reliance upon the Agent or any
other Bank and based on such documents and information as it has deemed appropriate, made
its own credit analysis and decision to enter into this Agreement. Each Bank also
acknowledges that it will, independently and without reliance upon the Agent or any other
Bank and based on such documents and information as it shall from time to time deem
appropriate, continue to make its own decisions in taking or not taking action under or
based upon this Agreement, any other Loan Document or related agreement or any document
furnished hereunder or thereunder. </FONT></P>

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<A NAME=A053></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ARTICLE XII  </FONT></H1>

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<A NAME=A054></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>MISCELLANEOUS </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.1 <U>Notices</U>. Unless otherwise
provided herein, all notices, requests, consents and demands shall be in writing and shall
be either hand-delivered (by courier or otherwise), mailed by certified mail, postage
prepaid, or transmitted via telex or facsimile to the respective addresses specified
below, or, as to any party, to such other address as may be designated by it in written
notice to the other parties: </FONT></P>

                  If to any Loan Party, to:                        If to the Agent, to:

                  Tengasco, Inc.                                   Citibank Texas, N.A.
                  10215 Technology Drive, Suite 301                8401 North Central Expressway
                  Knoxville, TN  37932                             Suite 500, Lockbox 36
                  Attention:  Mr. Jeffrey R. Bailey                Dallas, Texas  75225
                  Telephone:  (865) 675-1554                       Attention:  Angela McCracken
                  Facsimile:  (865) 675-1621                       Telephone:  (972) 419-3343
                                                                   Facsimile:  (972) 419-3334

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=10%>&nbsp;</TD>
<TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
If
to any Bank, to the address for notice specified beneath such Bank&#146;s name on the
signature pages hereto </FONT></TD>
</TR>
</TABLE>
<BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>All notices, requests, consents and
demands hereunder will be effective when hand-delivered or transmitted by telecopier or
sent, answer-back received, respectively, by the Agent to the notice address of the Loan
Parties, or two (2) Business Days after the date when mailed by certified mail, postage
prepaid, in each case given or addressed as aforesaid by either party hereto. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.2 <U>Place of Payment</U>. All
sums payable hereunder shall be paid in immediately available funds, at the Agent&#146;s
principal banking offices at One Lincoln Park, 8401 North Central Expressway, Suite 500,
Lockbox 36, Dallas, Texas 75225, Attention: Angela McCracken, or at such other place as
the Agent shall notify the Borrower in writing. If any interest, principal or other
payment falls due on a date other than a Business Day, then (unless otherwise provided
herein) such due date shall be extended to the next succeeding Business Day, and such
extension of time will in such case be included in computing interest, if any, in
connection with such payment. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.3 <U>Survival of Agreements</U>.
All covenants, agreements, representations and warranties made herein shall survive the
execution and the delivery of Loan Documents. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.4 <U>Parties in Interest</U>. All
covenants, agreements and obligations contained in this Agreement shall bind and inure to
the benefit of the parties hereto and the respective successors and permitted assigns of
the parties hereto, except that no Loan Party may assign any of its rights or obligations
hereunder or under any Loan Document without the prior written consent of the Agent. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.5 <U>Governing Law</U>. This Loan
Documents shall be governed by and construed in accordance with the laws of the State of
Texas without regard to conflicts of law principles; provided, however, that to the extent
the mandatory provisions of the laws of another jurisdiction relating to (i) the
perfection or the effect of perfection or non&#150;perfection of the security interests in
any of the property, (ii) the lien, encumbrance or other interest in the property granted
or conveyed by any Mortgage, or (iii) the availability of and procedures relating to any
remedy hereunder or related to this Mortgage are required to be governed by such other
jurisdiction&#146;s laws, such other laws shall be deemed to govern and control. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.6 <B><U>SUBMISSION TO
JURISDICTION</U>. EACH LOAN PARTY, EACH BANK AND THE AGENT HEREBY CONSENT TO THE
JURISDICTION OF ANY OF THE LOCAL, STATE, AND FEDERAL COURTS LOCATED WITHIN DALLAS COUNTY,
TEXAS AND IRREVOCABLY WAIVE ANY OBJECTION WHICH ANY LOAN PARTY, ANY BANK OR AGENT MAY HAVE
BASED ON IMPROPER VENUE OR FORUM NON CONVENIENS TO THE CONDUCT OF ANY PROCEEDING IN ANY
SUCH COURT AND WAIVE PERSONAL SERVICE OR ANY AND ALL PROCESS UPON IT, AND CONSENTS THAT
ALL SUCH SERVICE OF PROCESS BE MADE BY CERTIFIED MAIL DIRECTED TO IT AT THE ADDRESS SET
FORTH IN <U>SECTION 12.1</U> HEREOF AND THAT SERVICE SO MADE SHALL BE DEEMED TO BE
COMPLETED UPON THE EARLIER OF ACTUAL RECEIPT OR THREE (3) BUSINESS DAYS AFTER MAILED.
NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE AGENT, ANY BANK OR ANY HOLDER OF A NOTE TO
SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR
OTHERWISE PROCEED AGAINST ANY LOAN PARTY IN ANY OTHER JURISDICTION. THIS SUBMISSION TO
JURISDICTION IS NON-EXCLUSIVE AND DOES NOT PRECLUDE THE PARTIES FROM OBTAINING
JURISDICTION OVER OTHER PARTIES IN ANY COURT OTHERWISE HAVING JURISDICTION.</B> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.7 <U>Interest</U>. It is the
intention of the parties thereto that the Agent and the Banks shall conform strictly to
usury laws applicable to them. Accordingly, if the transactions contemplated hereby would
be usurious as to the Agent or any Bank under laws applicable to it (including the laws of
the United States of America or any other jurisdiction whose laws may be mandatorily
applicable to the Agent or any Bank notwithstanding the other provisions of this
Agreement), then, in that event, notwithstanding anything to the contrary in any of the
Loan Documents or any agreement entered into in connection with or as security for the
Notes, it is agreed as follows: (i) the aggregate of all consideration which constitutes
interest under law applicable to any Bank that is contracted for, taken, reserved, charged
or received by any Bank under any of the Loan Documents or agreements or otherwise in
connection with the Notes shall under no circumstances exceed the Maximum Rate, and any
excess shall be canceled automatically and if theretofore paid shall be credited by such
Bank on the principal amount of the Indebtedness (or, to the extent that the principal
amount of the Indebtedness shall have been or would thereby be paid in full, refunded by
any Bank to the Borrower); and (ii) in the event that the maturity of the Notes is
accelerated by reason of an election of the holder thereof resulting from any Event of
Default under this Agreement or otherwise, or in the event of any required or permitted
prepayment, then such consideration that constitutes interest under law applicable to the
Banks may never include interest greater than the Maximum Rate, and excess interest, if
any, provided for in this Agreement or otherwise shall be canceled automatically as of the
date of such acceleration or prepayment and, if theretofore paid, shall be credited by the
Banks on the principal amount of the Indebtedness (or, to the extent that the principal
amount of the Indebtedness shall have been or would thereby be paid in full, refunded by
the Banks to the Borrower). All sums paid or agreed to be paid to the Banks for the use,
forbearance or detention of sums due hereunder shall, to the extent permitted by law,
shall be amortized, prorated, allocated and spread throughout the full term of the Loans
evidenced by the Notes until payment in full so that the rate or amount of interest on
account of any Loans hereunder does not exceed the Maximum Rate. If at any time and from
time to time (i) the amount of interest payable to the Banks on any date shall be computed
at the highest lawful rate applicable to the Banks pursuant to this <U>Section 12.7</U>;
and (ii) in respect of any subsequent interest computation period the amount of interest
otherwise payable to Banks would be less than the amount of interest payable to the Banks
computed at the highest lawful rate applicable to the Banks, then the amount of interest
payable to the Banks in respect of such subsequent interest computation period shall
continue to be computed at the highest lawful rate applicable to the Banks until the total
amount of interest payable to the Banks shall equal the total amount of interest which
would have been payable to the Banks if the total amount of interest had been computed
without giving effect to this <U>Section&nbsp;12.7</U>. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.8 <U>No Waiver, Cumulative
Remedies</U>. No failure to exercise, and no delay in exercising, on the part of the Agent
or the Banks, any right, power or privilege hereunder or under any other Loan Document or
applicable Law shall preclude any other or further exercise thereof or the exercise of any
other right, power or privilege of the Agent or the Banks. The rights and remedies herein
provided are cumulative and not exclusive of any other rights or remedies provided by any
other instrument or by law. No notice to or demand on the Loan Parties in any case shall
entitle the Loan Parties to any other or further notice or demand in similar or other
circumstances. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.9 <U>Costs</U>. Each Loan Party
agrees to pay to the Agent on demand all recording fees and filing costs, all reasonable
attorneys fees and legal expenses, and all reasonable engineering fees and expenses
incurred or accrued by the Agent in connection with the due diligence, the Title Reports,
and preparation, negotiation, closing, administration, perfection, enforcement,
refinancing, renegotiation, restructuring, amendment, waiver or other modifications of
this Agreement and the Loan Documents and the filing and recording of the Security
Instruments or any amendment, waiver, consent or modification to and of the Loan
Documents. In any action to enforce or construe the provisions of this Agreement or any of
the Loan Documents, the Agent and each Bank shall be entitled to recover its reasonable
attorneys&#146; fees, disbursements of counsel and all costs and expenses related thereto. </FONT></P>

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<A NAME=A055></A>
<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.10 INDEMNITIES, ETC. </FONT></H1>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          TO INDEMNIFY THE AGENT, EACH BANK AND EACH OF THEIR RESPECTIVE AFFILIATES,
          OFFICERS, DIRECTORS, EMPLOYEES, REPRESENTATIVES AND AGENTS (&#147;<U>INDEMNIFIED
          PARTIES</U>&#148;) FROM, HOLD EACH OF THEM HARMLESS AGAINST AND PROMPTLY UPON
          DEMAND PAY OR REIMBURSE EACH OF THEM FOR, THE INDEMNITY MATTERS WHICH MAYBE
          INCURRED BY OR ASSERTED AGAINST OR INVOLVE ANY OF THEM (WHETHER OR NOT ANY OF
          THEM IS DESIGNATED A PARTY THERETO) AS A RESULT OF, ARISING OUT OF OR IN ANY WAY
          RELATED TO (I) ANY ACTUAL OR PROPOSED USE BY THE BORROWER OF THE PROCEEDS OF ANY
          OF THE LOANS; (II) THE EXECUTION, DELIVERY AND PERFORMANCE OF THE LOAN
          DOCUMENTS; (III) THE OPERATIONS OF THE BUSINESS OF ANY LOAN PARTY; (IV) THE
          FAILURE OF ANY LOAN PARTY TO COMPLY WITH THE TERMS OF ANY SECURITY INSTRUMENT OR
          THIS AGREEMENT, OR WITH ANY GOVERNMENTAL REQUIREMENT; (V) ANY INACCURACY OF ANY
          REPRESENTATION OR ANY BREACH OF ANY WARRANTY OF ANY LOAN PARTY SET FORTH IN ANY
          OF THE LOAN DOCUMENTS; (VI) THE ISSUANCE, EXECUTION AND DELIVERY OR TRANSFER OF
          OR PAYMENT OR FAILURE TO PAY UNDER ANY LETTER OF CREDIT; (VII) THE PAYMENT OF A
          DRAWING UNDER ANY LETTER OF CREDIT NOTWITHSTANDING THE NON-COMPLIANCE,
          NON-DELIVERY OR OTHER IMPROPER PRESENTATION OF THE MANUALLY EXECUTED DRAFT(S)
          AND CERTIFICATION(S); (VIII) ANY ASSERTION THAT THE AGENT OR ANY BANK WAS NOT
          ENTITLED TO RECEIVE THE PROCEEDS RECEIVED PURSUANT TO THE SECURITY INSTRUMENTS;
          OR (IX) ANY OTHER ASPECT OF THE LOAN DOCUMENTS, INCLUDING, WITHOUT LIMITATION,
          THE REASONABLE FEES AND DISBURSEMENTS OF COUNSEL AND ALL OTHER REASONABLE
          EXPENSES INCURRED IN CONNECTION WITH INVESTIGATING, DEFENDING OR PREPARING TO
          DEFEND ANY SUCH ACTION, SUIT, PROCEEDING (INCLUDING ANY INVESTIGATIONS,
          LITIGATION OR INQUIRIES) OR CLAIM AND INCLUDING ALL INDEMNITY MATTERS ARISING BY
          REASON OF THE ORDINARY NEGLIGENCE OF ANY INDEMNIFIED PARTY, BUT EXCLUDING ALL
          INDEMNITY MATTERS ARISING BY REASON OF THE GROSS NEGLIGENCE OR WILLFUL
          MISCONDUCT OF ANY INDEMNIFIED PARTY. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          No Indemnified Party may settle any claim to be indemnified without the consent
          of the indemnitor, such consent not to be unreasonably withheld;
          <U>provided</U>, that the indemnitor may not reasonably withhold consent to any
          settlement that an Indemnified Party proposes, if the indemnitor does not have
          the financial ability to pay all its obligations outstanding and asserted
          against the indemnitor at that time, including the maximum potential claims
          against the Indemnified Party to be indemnified pursuant to this <U>Section
          12.10</U>. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          In the case of any indemnification hereunder, the Agent or the applicable Bank
          shall give notice to the Borrower of any such claim or demand being made against
          the Indemnified Party and the Loan Parties shall have the non-exclusive right to
          join in the defense against any such claim or demand provided that if the Loan
          Parties provide a defense, the Indemnified Party shall bear its own cost of
          defense unless there is a conflict between the Loan Parties and such Indemnified
          Party. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(d)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          <B>THE FOREGOING INDEMNITIES SHALL EXTEND TO THE INDEMNIFIED PARTIES
          NOTWITHSTANDING THE SOLE OR CONCURRENT </B> <B>NEGLIGENCE OF EVERY KIND OR
          CHARACTER WHATSOEVER, WHETHER ACTIVE OR PASSIVE, WHETHER AN AFFIRMATIVE ACT </B>
          <B>OR AN OMISSION, INCLUDING WITHOUT LIMITATION, ALL TYPES OF NEGLIGENT CONDUCT
          IDENTIFIED IN THE </B> <B>RESTATEMENT (SECOND) OF TORTS OF ONE OR MORE OF THE
          INDEMNIFIED PARTIES OR BY REASON OF STRICT LIABILITY </B> <B>IMPOSED WITHOUT
          FAULT ON ANY ONE OR MORE OF THE INDEMNIFIED PARTIES EXCLUDING HOWEVER ONLY GROSS
          </B> <B>NEGLIGENCE AND WILLFUL MISCONDUCT.</B> </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.11 <U>Right of Setoff</U>. Each
Loan Party hereby grants to the Agent and each Bank a lien, security interest and right of
setoff as security for all liabilities and obligations of the Loan Parties, whether now
existing or hereafter arising, upon and against all deposits, credit, collateral and
property of such Loan Parties, now or hereafter in the possession, custody, safekeeping or
control of such Person. Upon (a) the occurrence and during the continuance of any Event of
Default; and (b) the decision by the Agent or the Required Banks to declare the Notes due
and payable pursuant to the provisions of <U>Article X</U>, the Agent, each Bank and each
of their Affiliates is hereby authorized at any time and from time to time, to set off and
otherwise apply any and all deposits (general or special, time or demand, provisional or
final, other than trust funds) at any time held and other indebtedness at any time owing
by the Agent or such Bank or such Affiliate to or for the credit or the account of any
Loan Party against any and all of the Indebtedness of the Loan Parties now or hereafter
existing under this Agreement and the Notes, irrespective of whether demand under this
Agreement or the Notes shall have been made and although such Indebtedness may be
unmatured. The Agent or applicable Bank shall promptly notify the Borrower after any such
set off and application; <U>provided</U>, <U>however</U>, that the failure to give such
notice shall not affect the validity of such setoff and application. The rights of the
Agent, the Bank and their respective Affiliates under this Section are in addition to
other rights and remedies (including, without limitation, other rights of set off) that
such Persons may have at law, in equity or otherwise. <B>ANY AND ALL RIGHTS TO REQUIRE THE
AGENT OR ANY BANK TO EXERCISE ANY RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHER COLLATERAL
WHICH SECURES THE ADVANCES PRIOR TO EXERCISING ANY RIGHT OF SET OFF WITH RESPECT TO ANY
DEPOSITS, CREDITS OR OTHER PROPERTY OF ANY LOAN PARTY ARE HEREBY KNOWINGLY, VOLUNTARILY
AND IRREVOCABLY WAIVED.</B> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.12 <U>Headings</U>. The article
and section headings of this Agreement are for convenience of reference only and shall not
constitute a part of the text hereof nor alter or otherwise affect the meaning or
interpretation of any provision hereof. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.13 <U>Severability</U>. The
unenforceability or invalidity as determined by a Tribunal of competent jurisdiction, of
any provision or provisions of this Agreement shall not render unenforceable or invalid
any other provision or provisions hereof. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.14 <U>Exceptions to Covenants</U>.
No Loan Party shall be deemed to be permitted to take any action or fail to take any
action which is permitted as an exception to any of the covenants contained herein or
which is within the permissible limits of any of the covenants contained herein if such
action or omission would result in the breach of any other covenant contained herein. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.15 <U>Conflict with Security
Instruments</U>. To the extent the terms and provisions of any of the Security Instruments
are in conflict with the terms and provisions hereof, this Agreement shall be deemed
controlling. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.16 <U>Confidentiality</U>. In the
event that any Loan Party provides to the Agent or the Banks written confidential
information belonging to the it, the Agent and the Banks shall thereafter maintain such
information in confidence in accordance with the standards of care and diligence that each
utilizes in maintaining its own confidential information. This obligation of confidence
shall not apply to such portions of the information which (i) are in the public domain;
(ii) hereafter become part of the public domain, without the Agent or such Bank breaching
its obligation of confidence to any Loan Party; (iii) are previously known by the Agent or
such Bank from some source other than such Loan Party; (iv) are hereafter developed by the
Agent or such Bank without using such Loan Party&#146;s information; (v) are hereafter
obtained by or available to the Agent or such Bank from a third party who owes no
obligation of confidence to such Loan Party with respect to such information; (vi) are
disclosed with such Loan Party&#146;s consent; (vii) must be disclosed either pursuant to
any Governmental Requirement or to Persons regulating the activities of the Agent or such
Bank; or (viii) as may be required by law or regulation or order of any Governmental
Authority in any judicial, arbitration or governmental proceeding. Further, the Agent and
the Banks may disclose any such information to consultants, any independent certified
public accountants or any legal counsel employed by such Persons in connection with this
Agreement or any Security Instrument, including without limitation, the enforcement or
exercise of all rights and remedies thereunder, or any assignee or participant (including
prospective assignees and participants) in the Loans; provided, however, that the Agent or
applicable Bank imposes on the Person to whom such information is disclosed the same
obligation to maintain the confidentiality of such information as is imposed upon it
hereunder. Notwithstanding anything to the contrary provided herein, this obligation of
confidence shall cease two (2) years from the date the information was furnished, unless
the Loan Parties request in writing at least thirty (30) days prior to the expiration of
such two year period, to maintain the confidentiality of such information for an
additional two year period. The Loan Parties waive any and all other rights they may have
to confidentiality as against the Agent or the Banks arising by contract, agreement,
statute or law except as expressly stated in this <U>Section 12.16</U>. The Agent and the
Banks agree not to issue or cause to be issued any tombstone or other publicly published
announcement of the lending facilities established by this Agreement without the Loan
Parties&#146; review and approval thereof, which such approval will not be unreasonably
withheld. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.17 <U>Survival</U>. The
obligations of the parties under <U>Sections 2.14</U>, <U>2.15</U>, <U>12.9</U> and
<U>12.10</U> hereof shall survive repayment of the Loans and the termination of the
Commitment. To the extent that any payments on the Indebtedness or proceeds of any
Collateral are subsequently invalidated, declared to be fraudulent or preferential, set
aside or required to be repaid to a trustee, debtor-in-possession, receiver or other
Person under any bankruptcy law, common law or equitable cause, then to such extent, the
Indebtedness so satisfied shall be revived and continue as if such payment or proceeds had
not been received and the Liens, security interests, rights, powers and remedies under
this Agreement and each Security Instrument shall continue in full force and effect. In
such event, each Security Instrument shall be automatically reinstated and the Loan
Parties shall take such action as may be reasonably requested by the Agent to effect such
reinstatement. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.18 <B><U>NO ORAL AGREEMENTS</U>.
THE LOAN DOCUMENTS EMBODY THE ENTIRE AGREEMENT AND UNDERSTANDING BETWEEN THE PARTIES AND
SUPERSEDE ALL OTHER AGREEMENTS AND UNDERSTANDINGS BETWEEN SUCH PARTIES RELATING TO THE
SUBJECT MATTER HEREOF AND THEREOF, THE LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT
BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN
THE PARTIES.</B> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.19 <B><U>WAIVER OF JURY</U>. EACH
LOAN PARTY AND THE AGENT FULLY, VOLUNTARILY, KNOWINGLY, INTENTIONALLY, UNCONDITIONALLY,
IRREVOCABLY AND EXPRESSLY WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING
TO ENFORCE OR DEFEND ANY RIGHTS UNDER THE NOTES, THIS AGREEMENT, THE SECURITY INSTRUMENTS
OR OTHER LOAN DOCUMENTS OR UNDER ANY AMENDMENT, SUPPLEMENT, INSTRUMENT, DOCUMENT OR
AGREEMENT DELIVERED (OR WHICH MAY IN THE FUTURE BE DELIVERED) BASED HEREON ARISES OUT OF,
UNDER, OR IN CONNECTION HEREWITH OR THE NOTES, THE SECURITY INSTRUMENTS OR OTHER LOAN
DOCUMENTS, INCLUDING ANY COUNTERCLAIM IN ANY LEGAL OR JUDICIAL PROCEEDING OR ACTION OR
ARISING FROM ANY TRANSACTIONS OR BANKING OR LENDING RELATIONSHIP EXISTING IN CONNECTION
WITH THIS AGREEMENT OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL
OR WRITTEN) OR ACTIONS OF ANY LOAN PARTY, ANY BANK OR THE AGENT. EACH LOAN PARTY AGREES
THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.
EACH LOAN PARTY ACKNOWLEDGES THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE AGENT
AND THE BANKS TO ENTER INTO THIS AGREEMENT, THE SECURITY INSTRUMENTS AND THE TRANSACTIONS
CONTEMPLATED HEREBY AND THEREBY. EACH LOAN PARTY CERTIFIES THAT NO PARTY HERETO NOR ANY
REPRESENTATIVE OR AGENT OR COUNSEL FOR ANY PARTY HERETO HAS REPRESENTED, EXPRESSLY OR
OTHERWISE, OR IMPLIED THAT SUCH PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO
ENFORCE THE FOREGOING WAIVERS.</B> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.20 <U>Counterparts</U>. This
Agreement may be executed in any number of counterparts, all of which taken together shall
constitute one and the same instrument and any of the parties hereto may execute this
Agreement by signing any such counterpart. Delivery of an executed counterpart of a
signature page to this Agreement by telecopier shall be as effective as delivery of a
manually executed counterpart of this Agreement. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.21 <U>Amendments</U>. No amendment
or waiver of any provision of this Agreement, the Notes, or any other Loan Document to
which any Loan Party is a party, nor any consent to any departure by any Loan Party
therefrom, shall in any event be effective unless the same shall be agreed or consented to
by Required Banks and such Loan Party, and each such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given; provided, that
no amendment, waiver, or consent shall, unless in writing and signed by all of the Banks
and such, do any of the following: (a) increase Commitments of the Banks or subject the
Banks to any additional obligations; (b) reduce the principal of, or interest on, the
Notes or any fees or other amounts payable hereunder; (c) postpone any date fixed for any
payment of principal of, or interest on, the Notes or any fees or other amounts payable
hereunder; (d) change the percentage of the Commitments or of the aggregate unpaid
principal amount of the Notes or the number of Banks which shall be required for the Banks
or any of them to take any action under this Agreement; (e) change any provision contained
in this <U>Section 12.21</U>; or (f) release any Collateral from any of the Liens created
by the Loan Documents unless such release arises pursuant to a transaction permitted under
the Loan Documents. Notwithstanding anything to the contrary contained in this Section, no
amendment waiver, or consent shall be made with respect to (y) <U>Article XI</U> hereof
without the prior written consent of the Agent or (z) <U>Section 2.13</U> without the
prior written consent of the Letter of Credit Issuer. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.22 <U>No Liability of the Letter
of Credit Issuer</U>. The Borrower assumes all risks of the acts or omissions of any
beneficiary or transferee of any Letter of Credit with respect to its use of such Letter
of Credit. Neither the Letter of Credit Issuer nor any of its officers, directors,
employees or agents shall be liable or responsible for: (a) the use that may be made of
any Letter of Credit or any acts or omissions of any beneficiary or transferee in
connection therewith; and (b) the validity, sufficiency or genuineness of documents, or of
any endorsement thereon, even if such documents should prove to be in any or all respects
invalid, insufficient, fraudulent or forged; except that the Borrower shall have a claim
against the Letter of Credit Issuer, and the Letter of Credit Issuer shall be liable to
the Borrower, to the extent of any direct, but not consequential, damages suffered by the
Borrower that the Borrower proves were caused by (i) the Letter of Credit Issuer&#146;s
willful misconduct or gross negligence in determining whether documents presented under
any Letter of Credit are genuine and/or comply with the terms of the Letter of Credit; or
(ii) the Letter of Credit Issuer&#146;s willful failure to make lawful payment under a
Letter of Credit after the presentation to it of a draft and certificates strictly
complying with the terms and conditions of the Letter of Credit. In furtherance and not in
limitation of the foregoing, the Letter of Credit Issuer may accept documents that appear
on their face to be in order, without responsibility for further investigation, regardless
of any notice or information to the contrary. </FONT></P>

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<A NAME=A056></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.23 Successors and
Assigns. </FONT></P>

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     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          The provisions of this Agreement shall be binding upon and inure to the benefit
          of the parties hereto and their respective successors and assigns permitted
          hereby (including any Affiliate of the Letter of Credit Issuer that issues any
          Letter of Credit), except that (i) the Borrower may not assign or otherwise
          transfer any of its rights or obligations hereunder without the prior written
          consent of each Bank (and any attempted assignment or transfer by the Borrower
          without such consent shall be null and void) and (ii) no Bank may assign or
          otherwise transfer its rights or obligations hereunder except in accordance with
          this Section. Nothing in this Agreement, expressed or implied, shall be
          construed to confer upon any Person (other than the parties hereto, their
          respective successors and assigns permitted hereby (including any Affiliate of
          the Letter of Credit Issuer that issues any Letter of Credit), Participants (to
          the extent provided in clause (c) of this Section) and, to the extent expressly
          contemplated hereby, the Related Parties of each of the Agent, the Letter of
          Credit Issuer and the Banks) any legal or equitable right, remedy or claim under
          or by reason of this Agreement. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          (i) Subject to the conditions set forth in clause (b)(ii) below, any Bank may
          assign to one or more assignees all or a portion of its rights and obligations
          under this Agreement (including all or a portion of its Commitment and the
          Revolver Loans at the time owing to it) with the prior written consent (such
          consent not to be unreasonably withheld) of: </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=10%></TD>
               <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(A)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the Borrower, <U>provided</U> that no consent of the Borrower shall be required
               for an assignment to a Bank, an Affiliate of a Bank, an Approved Fund or, if an
               Event of Default has occurred and is continuing, any other assignee; and </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(B)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          the Agent. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(ii)&nbsp;&nbsp;&nbsp;&nbsp;
          Assignments shall be subject to the following additional conditions: </FONT></P>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=10%></TD>
               <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(A)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               except in the case of an assignment to a Bank or an Affiliate of a Bank or an
               assignment of the entire remaining amount of the assigning Bank&#146;s
               Commitment or Revolver Loans, the amount of the Commitment or Revolver Loans of
               the assigning Bank subject to each such assignment (determined as of the date
               the assignment and assumption with respect to such assignment is delivered to
               the Agent) shall not be less than $5,000,000, unless each of the Borrower and
               the Agent otherwise consent, <U>provided</U> that no such consent of the
               Borrower shall be required if an Event of Default has occurred and is
               continuing; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=10%></TD>
               <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(B)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               each partial assignment shall be made as an assignment of a proportionate part
               of all the assigning Bank&#146;s rights and obligations under this Agreement;
               and </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=10%></TD>
               <TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(C)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               the parties to each assignment shall execute and deliver to the Agent an
               assignment and assumption, together with a processing and recordation fee of
               $3,500. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
term &#147;<U>Approved Fund</U>&#148; has the following meaning: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Approved
Fund</U>&#148; means any Person (other than a natural person) that is engaged in making,
purchasing, holding or investing in bank loans and similar extensions of credit in the
ordinary course of its business and that is administered or managed by (a) a Bank, (b) an
Affiliate of a Bank or (c) an entity or an Affiliate of an entity that administers or
manages a Bank. </FONT></P>

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          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(iii)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Subject to acceptance and recording thereof pursuant to clause&nbsp;(b)(iv) of
          this Section, from and after the effective date specified in each assignment and
          assumption the assignee thereunder shall be a party hereto and, to the extent of
          the interest assigned by such assignment and assumption, have the rights and
          obligations of a Bank under this Agreement, and the assigning Bank thereunder
          shall, to the extent of the interest assigned by such assignment and assumption,
          be released from its obligations under this Agreement (and, in the case of an
          assignment and assumption covering all of the assigning Bank&#146;s rights and
          obligations under this Agreement, such Bank shall cease to be a party hereto but
          shall continue to be entitled to the benefits of <U>Sections&nbsp;2.14</U>,
          <U>2.15</U>, <U>2.19</U>, <U>12.9</U> and <U>12.10</U>). Any assignment or
          transfer by a Bank of rights or obligations under this Agreement that does not
          comply with this <U>Section 12.23 </U> shall be treated for purposes of this
          Agreement as a sale by such Bank of a participation in such rights and
          obligations in accordance with clause (c) of this Section. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(iv)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          The Agent, acting for this purpose as an agent of the Borrower, shall maintain
          at one of its offices a copy of each assignment and assumption delivered to it
          and a register for the recordation of the names and addresses of the Banks, and
          the Commitment of, and principal amount of the Revolver Loans and disbursement
          under Letters of Credit owing to, each Bank pursuant to the terms hereof from
          time to time (the &#147;<U>Register</U>&#148;). The entries in the Register
          shall be conclusive, and the Borrower, the Agent, the Letter of Credit Issuer
          and the Banks may treat each Person whose name is recorded in the Register
          pursuant to the terms hereof as a Bank hereunder for all purposes of this
          Agreement, notwithstanding notice to the contrary. The Register shall be
          available for inspection by the Borrower, the Letter of Credit Issuer and any
          Bank, at any reasonable time and from time to time upon reasonable prior notice. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(v)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Upon its receipt of a duly completed assignment and assumption executed by an
          assigning Bank and an assignee, the assignee&#146;s completed Administrative
          Questionnaire (unless the assignee shall already be a Bank hereunder), the
          processing and recordation fee referred to in clause&nbsp;(b) of this Section
          and any written consent to such assignment required by clause (b) of this
          Section, the Agent shall accept such assignment and assumption and record the
          information contained therein in the Register; <U>provided</U> that if either
          the assigning Bank or the assignee shall have failed to make any payment
          required to be made by it pursuant to this Agreement, the Agent shall have no
          obligation to accept such assignment and assumption and record the information
          therein in the Register unless and until such payment shall have been made in
          full, together with all accrued interest thereon. No assignment shall be
          effective for purposes of this Agreement unless it has been recorded in the
          Register as provided in this clause. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          (i) Any Bank may, without the consent of the Borrower, the Agent, or the Letter
          of Credit Issuer, sell participations to one or more banks or other entities (a
          &#147;<U>Participant</U>&#148;) in all or a portion of such Bank&#146;s rights
          and obligations under this Agreement (including all or a portion of its
          Commitment and the Revolver Loans owing to it); <U>provided</U> that
          (A)&nbsp;such Bank&#146;s obligations under this Agreement shall remain
          unchanged, (B)&nbsp;such Bank shall remain solely responsible to the other
          parties hereto for the performance of such obligations and (C)&nbsp;the
          Borrower, the Agent, the Letter of Credit Issuer and the other Banks shall
          continue to deal solely and directly with such Bank in connection with such
          Bank&#146;s rights and obligations under this Agreement. Any agreement or
          instrument pursuant to which a Bank sells such a participation shall provide
          that such Bank shall retain the sole right to enforce this Agreement and to
          approve any amendment, modification or waiver of any provision of this
          Agreement; <U>provided</U> that such agreement or instrument may provide that
          such Bank will not, without the consent of the Participant, agree to any
          amendment, modification or waiver described in the first proviso to
          <U>Section&nbsp;12.21</U> that affects such Participant. Subject to clause
          (c)(ii) of this Section, the Borrower agrees that each Participant shall be
          entitled to the benefits of <U>Sections&nbsp;2.14</U>, <U>2.15</U>, <U>2.19</U>,
          <U>12.9</U> and <U>12.10</U> to the same extent as if it were a Bank and had
          acquired its interest by assignment pursuant to clause (b) of this Section. To
          the extent permitted by law, each Participant also shall be entitled to the
          benefits of <U>Section&nbsp;12.11</U> as though it were a Bank, provided such
          Participant agrees to be subject to <U>Section 2.17 </U> as though it were a
          Bank. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(ii)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          A Participant shall not be entitled to receive any greater payment hereunder
          than the applicable Bank would have been entitled to receive with respect to the
          participation sold to such Participant, unless the sale of the participation to
          such Participant is made with the Borrower&#146;s prior written consent. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(d)</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Any Bank may at any time pledge or assign a security interest in all or any
          portion of its rights under this Agreement to secure obligations of such Bank,
          including without limitation any pledge or assignment to secure obligations to a
          Federal Reserve Bank, and this Section shall not apply to any such pledge or
          assignment of a security interest; <U>provided</U> that no such pledge or
          assignment of a security interest shall release a Bank from any of its
          obligations hereunder or substitute any such pledgee or assignee for such Bank
          as a party hereto. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12.24 <U>USA Patriot Act Notice</U>.
Each Bank hereby notifies each Loan Party that pursuant to the requirements of the USA
Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the
&#147;<U>Patriot Act</U>&#148;), it is required to obtain, verify and record information
that identifies each Loan Party and its owners, which includes the names and addresses of
such Loan Party and its owners and other information that will allow such Bank to identify
such Loan Party and its owners in accordance with the Patriot Act. </FONT></P>

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<A NAME=A057></A>
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>[Remainder of page
intentionally left blank] </FONT></H1>


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<A NAME=A058></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>SCHEDULE 9.25, Page 1 </FONT></P>

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<A NAME=A059></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>DALLAS1 1099496v4
67682-00024 </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN
WITNESS WHEREOF, the Borrower has caused this Agreement to be executed and delivered to
the Agent and the Banks in Dallas, Texas, effective as of the day and year first above
written by the undersigned duly authorized corporate officer of the Borrower. </FONT></P>

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<A NAME=A060></A>
<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;TENGASCO,
INC., a Tennessee corporation</FONT></P>

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     <TD>By: <u>s/Jeffrey R. Bailey</u><br>Name: Jeffrey R. Bailey<br>Title: Chief Executive Officer</TD>
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     <TD><br><br>CITIBANK TEXAS, N.A., as the Agent and as a Bank<br>By: <u> s/Angela McCracken</u><br>Angela McCracken<br>Vice President</TD>
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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Acknowledged and Accepted this 29th
day of June, 2006 by the following Loan Parties: </FONT></P>

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<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>TENNESSEE LAND &amp;
MINERAL CORPORATION, <br>a Tennessee corporation</FONT></P>

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<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2> </FONT></P>




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     <TD>By: <u>s/Jeffrey R. Bailey</u><br>Name: Jeffrey R. Bailey<br>Title: Chief Executive Officer</TD>
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<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>TENGASCO PIPELINE CORPORATION,<br>
a Tennessee corporation</FONT></P>


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     <TD>By: <u>s/Jeffrey R. Bailey</u><br>Name: Jeffrey R. Bailey<br>Title: Chief Executive Officer</TD>
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<DESCRIPTION>PRESS RELEASE JULY 5, 2006
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<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>For immediate release </FONT></H1>

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<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>July 5, 2006 </FONT></H1>

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<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Tengasco, Inc. Announces
Closing of $50 Million Revolving Credit Facility with Citibank, Repurchase of DrillingProgram
<BR>Interests, Completion of All Kansas Program Drilling Obligations, and Record Kansas
Oil Production </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Knoxville, Tenn. Tengasco, Inc.
(AMEX:TGC) announced today the closing of a $50,000,000 revolving senior credit facility
between the Company and Citibank Texas, N.A. in its own capacity and also as agent for
other banks. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Under the facility, loans and letters
of credit will be available to the Company on a revolving basis in an amount outstanding
not to exceed the lesser of $50,000,000 or the borrowing base in effect from time to time.
The Company&#146;s initial borrowing base was set at $2,600,000. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The initial loan under the facility
with Citibank closed on June 29, 2006 in the principal amount of $2.6 million, bearing
interest at a floating rate equal to LIBOR plus 2.5%, resulting in a current rate of
interest of approximately 8.2%. Interest only is payable during the term of the loan and
the principal balance of the loan is due thirty-six months from closing. The facility is
secured by a lien on substantially all of the Company&#146;s producing and non-producing
oil and gas properties and pipeline assets. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>$1.393 million of the $2.6 million
loan proceeds was used by the Company on June 29, 2006 to exercise its option to
repurchase from Hoactzin Partners, L.P., the Company&#146;s obligation to drill the final
six wells in the Company&#146;s 12-well Kansas drilling program for Hoactzin. The
controlling person of Hoactzin is Dolphin Advisors, LLC, an entity controlled by Peter E.
Salas, the Company&#146;s Chairman of the Board. If the Company did not exercise its
repurchase option, Hoactzin would have received a 94% working interest in the final six
wells of the program. As a result of the repurchase, Hoactzin will now receive only a
6.25% overriding royalty in six Company wells to be drilled, plus an additional 6.25%
overriding royalty in the six program wells that have previously been drilled. As a
further result of the repurchase, the 12-well program has been converted to a 6-well
program, all of which have been drilled by the Company. Production from those six will
continue to be paid to Hoactzin in accordance with the payment terms of the drilling
program. Since the Company&#146;s earlier 8-well program drilling obligations were also
satisfied earlier in 2006, the Company as of June 30, 2006 has no obligation to drill any
additional wells for any parties other than the Company itself. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The balance of the $2.6 million loan
will be used for lease acquisition and three dimensional seismic surveys and analysis for
oil exploration on large tracts in Kansas. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Company also announced
operational results for oil production in Kansas. In June, 2006, the Company produced
16,576 gross barrels of oil in Kansas, the highest monthly production total since the
Company acquired the properties in early 1998. The Company&#146;s Kansas oil production in
the second quarter of 2006 was 44,458 total barrels, with approximately 30,945 barrels of
oil being produced allocable to the Company&#146;s working interest during the quarter.
The second quarter total oil production was also the highest quarterly production total
since the Company acquired the Kansas properties in early 1998. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>CEO Jeffrey R. Bailey said,
&#147;Establishing a working relationship with an energy lender with Citibank&#146;s
national presence in oil and gas lending is the last piece in our cleanup of the
Company&#146;s finances and in laying a foundation for our continued growth. Our business
model has been to focus on growth, and we believe that model has now received validation
with the closing of this loan facility with a major industry lender. Much work remains as
we seek out intelligent acquisitions and growth opportunities. Besides building the
Company&#146;s oil and gas reserves through the drill bit and expanding our lease acreage
position in Kansas, we are also exploring ways to utilize the inherent value of our
pipeline assets in Tennessee that we believe have significant development and strategic
potential.&#148; </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#147;I am extremely pleased that
this loan from Citibank has provided an opportunity to repurchase our drilling obligations
to others and to now put us in a position where we are drilling wells solely for the
Company&#146;s interest. This drilling will begin immediately this week. This will
certainly help the Company to quickly build a larger reserve base.&nbsp;Although the
company owns a majority working interest in approximately 140 wells in Kansas, the last 14
wells that the Company drilled were all part of the drilling programs which were used to
satisfy many of the Company&#146;s obligations to its former preferred stockholders and
resulted in the Company only having a minority interest in those wells. Although those 14
program wells already drilled will continue until payout to distribute revenues to the
participants, we are extremely pleased to have completed all of our obligations to our
participants to drill new or additional program wells. We can now return to drilling wells
in which the Company will own 100% of the working interest for the benefit of all the
Company&#146;s common stockholders.&#148;&nbsp;&nbsp; </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&#147;Our continuing production of
record volumes of oil in Kansas, increasing our reserves, and now establishing a banking
relationship with a premiere energy bank that should continue to grow long after the
initial three year term, speak volumes about the positive direction in which the Company
is now headed. We are excited about the opportunities and the strengthened position the
Company now enjoys as we enter a new chapter in Tengasco history. This new chapter should
be one of increasing growth while decreasing both exploration and financial risks.&#148; </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Company announced that it expects
to file with the Securities and Exchange Commission, its Report on Form 10-Q for the
Quarter Ended June 30, 2006 in early August, 2006. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Forward-looking statements made in
this release are made pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Investors are cautioned that all forward-looking statements
involve risk and uncertainties which may cause actual results to differ from anticipated
results, including risks associated with the timing and development of the Company&#146;s
reserves and projects as well as risks of downturns in economic conditions generally, and
other risks detailed from time to time in the Company&#146;s filings with the Securities
and Exchange Commission. </FONT></P>
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