AMENDED AND RESTATED CREDIT AGREEMENT

Exhibit 10.6

Amended and Restated Credit Agreement

THIS AMENDED AND RESTATED CREDIT AGREEMENT, dated as of May 30, 2008, by and among NGAS RESOURCES, INC., a corporation organized under the laws of the Province of British Columbia (“ Holdings ”), DAUGHERTY PETROLEUM, INC., a Kentucky corporation (the “ Borrower ”), the several banks and other financial institutions or entities from time to time party to this Agreement (the “ Lenders ”), and KEYBANK NATIONAL ASSOCIATION, as administrative agent (in such capacity, the “ Administrative Agent ”).

RECITALS

WHEREAS, Holdings, the Borrower, the Lenders and the Administrative Agent entered into a Credit Agreement dated as of September 8, 2006 (as previously amended or supplemented, the “ Existing Credit Agreement ”);

WHEREAS, pursuant to the Existing Credit Agreement, the Lenders have made revolving loans to the Borrower on the terms and conditions set forth therein (the “ Existing Revolving Loans ”);

WHEREAS, the Borrower has requested that the Administrative Agent and the Lenders amend and restate the Existing Credit Agreement (including the existing obligations and liabilities of the Borrower thereunder);

WHEREAS, the Administrative Agent and the Lenders are willing to amend and restate the Existing Credit Agreement and continue the Existing Revolving Loans upon the terms and conditions set forth herein; and

WHEREAS, the Existing Revolving Loans and all of the other Obligations are and shall continue to be secured by, among other things, the Existing Oil and Gas Mortgages (as defined herein) and the other Security Documents, both now existing and hereafter coming into effect.

NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the parties hereto, such parties hereby agree to amend and restate the Existing Credit Agreement, and the Existing Credit Agreement is hereby amended and restated in its entirety, as follows:

ARTICLE I

DEFINITIONS

Section 1.01. Defined Terms . As used in this Agreement, the terms listed in this Section 1.01 shall have the respective meanings set forth in this Section 1.01.

“ ABR ” means, for any day, a rate per annum (rounded upwards, if necessary, to the next 1/16 of 1%) equal to the greatest of (a) the Prime Rate in effect on such day and (b) the Federal Funds Effective Rate in effect on such day plus 0.50%. For purposes hereof: “ Prime Rate ” shall mean the rate of interest per annum publicly announced from time to time by the Reference Lender as its prime rate in effect at its principal office in Cleveland, Ohio (the Prime Rate not being intended to be the lowest rate of interest charged by the Reference Lender in connection with extensions of credit to debtors). Any change in the ABR due to a change in the Prime Rate or the Federal Funds Effective Rate shall be effective as of the opening of business on the effective day of such change in the Prime Rate or the Federal Funds Effective Rate, respectively.

“ ABR Loans ” means Loans the rate of interest applicable to which is based upon the ABR.

“ Acceptable Lien ” in any Property means a Lien which (a) is created by the Borrower or any of its Restricted Subsidiaries in favor of the Administrative Agent, for the benefit of the Secured Parties, (b) is superior to all Liens or rights of any other Person in the Property encumbered thereby, other than applicable Permitted Liens, (c) secures the payment and performance of the Obligations, and (d) is valid, perfected and enforceable.

“ Additional Oil and Gas Mortgages ” means all Oil and Gas Mortgages entered into by the Borrower or any Restricted Subsidiary from time to time after the Closing Date.

“ Additional Pipeline Mortgages ” means all Pipeline Mortgages entered into by the Borrower or any Restricted Subsidiary from time to time after the Post-Closing Date.

“ Administrative Agent ” means KeyBank National Association, as the administrative agent for the Lenders under this Agreement and the other Loan Documents, and any of its successors.

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

“ Affiliate ” means, as to any Person, any other Person that, directly or indirectly, is in control of, is controlled by, or is under common control with, such Person. For purposes of this definition, “control” of a Person means the power, directly or indirectly, either to (a) vote 5% or more of the Equity Interests having ordinary voting power for the election of directors (or persons performing similar functions) of such Person or (b) direct or cause the direction of the management and policies of such Person, whether through the ownership of Equity Interests, by contract or otherwise.

“ After-Acquired Oil and Gas Properties ” has the meaning specified in Section 6.11(b)(i).

“ Aggregate Exposure ” means, with respect to any Lender at any time, an amount equal to the amount of such Lender’s Borrowing Base Commitment then in effect or, if the Commitments have been terminated, the amount of such Lender’s Outstanding Credit at such time.

“ Aggregate Exposure Percentage ” means, with respect to any Lender at any time, the ratio (expressed as a percentage) of such Lender’s Aggregate Exposure at such time to the Aggregate Exposure of all Lenders at such time.

“ Aggregate Outstanding Credit ” means, at any time, the aggregate Outstanding Credit of all Lenders at such time.

“ Agreement ” means this Credit Agreement.

“ Anti-Terrorism Order ” means Executive Order No. 13,224 of September 24, 2001, Blocking Property and Prohibiting Transactions with Persons Who Commit, Threaten to Commit or Support Terrorism, 66 U.S. Fed. Reg. 49, 079 (2001), as amended.

“ Applicable Margin ” means, for any day, with respect to any Type of Loan, or with respect to Unused Commitment Fees payable under this Agreement, as the case may be, the applicable rate per annum set forth below under the column heading “Applicable Margin for Eurodollar Loans,” “Applicable Margin for ABR Loans,” or “Unused Commitment Fee Rate,” as the case may be, based upon the Conforming Borrowing Base Usage in effect on such date:

Each change in the Applicable Margin for Eurodollar Loans, the Applicable Margin for ABR Loans, and the Unused Commitment Fee Rate shall apply during the period commencing on the effective date of such change and ending on the date immediately preceding the effective date of the next change. If an Event of Default exists, the Applicable Margin and the Unused Commitment Fee Rate shall be at Level V.

“ Applicable Percentage ” means, with respect to any Lender at any time, the percentage (carried out to the ninth decimal place) of the aggregate Commitments represented by such Lender’s Commitment at such time. If the Commitment of each Lender to make Loans and the obligation of the Issuing Bank to issue Letters of Credit have been terminated pursuant to Section 8.01, or if the Commitments have expired, then the Applicable Percentage of each Lender shall be determined based on the Applicable Percentage of such Lender most recently in effect, giving effect to any subsequent assignments. The initial Applicable Percentage of each Lender is set forth opposite the name of such Lender on Schedule 1.01A or in the Assignment and Assumption pursuant to which such Lender becomes a party hereto, as applicable.

“ Application ” means an application, in such form as the Issuing Bank may specify from time to time, requesting the Issuing Bank to open a Letter of Credit.

“ Approved Counterparty ” means, with respect to any Approved Farmout Agreement or any Approved Participation Agreement at any time, any Person that is a party to such Approved Farmout Agreement or such Approved Participation Agreement (other than the Borrower or any Restricted Subsidiary) and which (a) is not subject to a Solvency Event at such time and (b) has not defaulted, or otherwise failed to perform any of its payment, assignment, or other material obligations, under such Approved Farmout Agreement or Approved Participation Agreement at such time.

“ Approved Farmout Agreement ” means, at any time, any Farmout Agreement between or among one or more Approved Counterparties, as farmors, and the Borrower or any Restricted Subsidiary, as farmee, a complete and correct executed copy of which has been delivered to the Administrative Agent, which is (a) in form and substance reasonably satisfactory to the Administrative Agent, (b) if required by the Administrative Agent, subject to a Farmout Agreement Consent at such time, (c) valid, binding and enforceable against all parties thereto in accordance with its respective terms at such time, and (d) not in default or otherwise subject to termination or rescission at such time as a result of any act or omission of the Borrower or any Restricted Subsidiary.

“ Approved Farmout Property ” means, at any time, any Farmout Property which has been assigned by one or more Approved Counterparties to the Borrower or any Restricted Subsidiary pursuant to an Approved Farmout Agreement and a valid, binding and enforceable Farmout Property Assignment which has been prepared, executed, delivered and recorded in accordance with such Approved Farmout Agreement and which Farmout Property is, in the determination of the Administrative Agent, (a) adequately described for purposes of creating and maintaining an Acceptable Lien therein, and (b) not subject to any litigation, claim, or other proceeding which challenges or disputes the Borrower’s or such Restricted Subsidiary’s rights, title or interests therein.

“ Approved Fund ” means any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender, or (c) an entity or Affiliate of an entity that administers or manages a Lender.

“ Approved Hedge Counterparty ” means, at any time, (a) any Person engaged in the business of buying, selling and dealing in Hedge Agreements that is acceptable to the Administrative Agent and (i) has and maintains, or (ii) has a guarantor or other credit support provider that is acceptable to the Administrative Agent and has and maintains, a Credit Rating of A- or better from S&P or A3 or better from Moody’s and (b) any Hedge Bank.

“ Approved Participation Agreement ” means, at any time, any Participation Agreement between or among one or more Approved Counterparties and the Borrower or any Restricted Subsidiary, a complete and correct executed copy of which has been delivered to the Administrative Agent, which is (a) in form and substance reasonably satisfactory to the Administrative Agent, (b) if required by the Administrative Agent, subject to a Participation Agreement Consent at such time, (c) valid, binding and enforceable against all parties thereto in accordance with its respective terms at such time, and (d) not in default or otherwise subject to termination or rescission at such time as a result of any act or omission of the Borrower or any Restricted Subsidiary.

“ Approved Participation Property ” means, at any time, any Participation Property which have been assigned by one or more Approved Counterparties to the Borrower or any Restricted Subsidiary pursuant to an Approved Participation Agreement and a valid, binding and enforceable Participation Property Assignment which has been prepared, executed, delivered and recorded in accordance with such Approved Participation Agreement and which Participation Property is, in the determination of the Administrative Agent, (a) adequately described for purposes of creating and maintaining an Acceptable Lien therein, and (b) not subject to any litigation, claim, or other proceeding which challenges or disputes the Borrower’s or such Restricted Subsidiary’s rights, title or interests therein.

“ Arranger ” means KeyBank, in its capacity as sole lead arranger and sole bookrunner hereunder.

“ Assignment and Assumption ” means an Assignment and Assumption entered into by a Lender and an assignee (with the consent of any party whose consent is required by Section 10.06), and accepted by the Administrative Agent), in substantially the form of Exhibit E or any other form approved by the Administrative Agent.

“ Attributable Indebtedness ” means, on any date, (a) in respect of any Capitalized Lease of any Person, the capitalized amount thereof that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP, (b) in respect of any Synthetic Lease Obligation, the capitalized amount of the remaining lease or similar payments under the relevant lease or other applicable agreement or instrument that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP if such lease or other agreement or instrument were accounted for as a Capital Lease Obligation, and (c) all Synthetic Debt of such Person.

“ Availability ” means, at any time, an amount equal to the lesser of (a) the Total Commitments then in effect minus the Aggregate Outstanding Credit, and (b) the Borrowing Base then in effect minus the Aggregate Outstanding Credit.

“ Available Commitment ” means, as to any Lender at any time, an amount equal to the excess, if any, of (a) such Lender’s Commitment then in effect over (b) such Lender’s Credit Extensions then outstanding.

“ Board ” means the Board of Governors of the Federal Reserve System of the United States (or any successor).

“ Borrower ” has the meaning specified in the preamble hereto.

“ Borrowing Base ” means at any particular time, the Dollar amount determined in accordance with Section 2.02 on account of (a) Proved Properties owned by the Borrower or any Restricted Subsidiary that are subject to Acceptable Liens created pursuant to Oil and Gas Mortgages and other applicable Security Documents in favor of the Administrative Agent, for the benefit of the Secured Parties, and that are described in the most recent Engineering Report delivered to the Administrative Agent and the Lenders pursuant to Section 2.02, (b) Approved Farmout Properties owned by the Borrower or any Restricted Subsidiary that are subject to Acceptable Liens created pursuant to Oil and Gas Mortgages and other applicable Security Documents in favor of the Administrative Agent, for the benefit of the Secured Parties, and that are described in the most recent Engineering Report and Farmout/Participation Property Certificate delivered to the Administrative Agent and the Lenders pursuant to Section 2.02, (c) Approved Participation Properties owned by the Borrower or any Restricted Subsidiary that are subject to Acceptable Liens created pursuant to Oil and Gas Mortgages and other applicable Security Documents in favor of the Administrative Agent for the benefit of the Secured Parties and that are described in the most recent Engineering Report and Farmout/Participation Property Certificate delivered to the Administrative Agent and the Lenders pursuant to Section 2.02, and (d) Open-Access Pipeline Properties owned by the Borrower and its Restricted Subsidiaries and that are subject to Acceptable Liens created pursuant to Pipeline Mortgages and other applicable Security Documents in favor of the Administrative Agent, for the benefit of the Secured Parties.

“ Borrowing Base Availability ” means, at any time, for any Lender, an amount equal to (a) such Lender’s Borrowing Base Commitment minus (b) such Lender’s Outstanding Credit.

“ Borrowing Base Availability Percentage ” means, at any time, for any Lender, the quotient, expressed as a percentage, of (a) such Lender’s Borrowing Base Availability divided by (b) Total Borrowing Base Availability.

“ Borrowing Base Commitment ” means, as to any Lender on any date, such Lender’s Applicable Percentage of the Borrowing Base on such date, subject to adjustment pursuant to Section 2.02(d)(vi). The aggregate amount of all Borrowing Base Commitments on the Closing Date is $75,000,000.

“ Borrowing Base Commitment Percentage ” means, as to any Lender, the percentage of the Borrowing Base represented by such Lender’s Borrowing Base Commitment, as adjusted from time to time in accordance with this Section 2.02 of the Agreement

“ Borrowing Base Increase ” means any increase (or proposed increase) in the amount of the Borrowing Base pursuant to a redetermination made in accordance with Section 2.02.

“ Borrowing Base Properties ” means, at any time, all Proved Properties, all Approved Farmout Properties, all Approved Participation Properties, and all Open-Access Pipeline Properties, in each case as and to the extent included in the Borrowing Base at such time in accordance with Section 2.02.

“ Borrowing Date ” means any Business Day specified by the Borrower as a date on which the Borrower requests the Lenders to make Loans hereunder.

“ Business ” has the meaning specified in Section 5.16.

“ Business Day ” means a day other than a Saturday, Sunday or other day on which commercial banks in Cleveland, Ohio, are authorized or required by law to close, provided , that with respect to notices and determinations in connection with, and payments of principal and interest on, Eurodollar Loans, such day is also a day for trading by and between banks in Dollar deposits in the interbank eurodollar market.

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

“ Cash ” or “ cash ” means money, currency or a credit balance in a deposit account.

“ Cash Collateralize ” means to pledge and deposit with or deliver to the Administrative Agent, for the benefit of the Secured Parties, Cash in an amount equal to the then outstanding LC Obligations, pursuant to documentation in form and substance satisfactory to the Administrative Agent and the Issuing Bank (which documents are hereby consented to by the Lenders). Derivatives of such term shall have corresponding meanings.

“ Cash Equivalents ” means any of the following:

(a) marketable direct obligations issued by, or unconditionally guaranteed by, the United States Government or issued by any agency thereof and backed by the full faith and credit of the United States, in each case maturing within one year from the date of acquisition;

(b) certificates of deposit, time deposits, eurodollar time deposits or overnight bank deposits having maturities of six months or less from the date of acquisition issued by any Lender or by any commercial bank organized under the laws of the United States or any state thereof having combined capital and surplus of not less than $500,000,000;

(c) commercial paper of an issuer rated at least A-1 by S&P or P-1 by Moody’s, or carrying an equivalent rating by a nationally recognized rating agency, if both of the two named rating agencies cease publishing ratings of commercial paper issuers generally, and maturing within six months from the date of acquisition;

(d) fully collateralized repurchase obligations of any Lender or of any commercial bank satisfying the requirements of clause (b) of this definition, having a term of not more than 30 days, with respect to securities issued or fully guaranteed or insured by the United States government;

(e) securities with maturities of one year or less from the date of acquisition issued or fully guaranteed by any state, commonwealth or territory of the United States, or by any political subdivision or taxing authority of any such state, commonwealth or territory the securities of which state, commonwealth, territory, political subdivision, or taxing authority (as the case may be) are rated at least A by S&P or A by Moody’s;

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

(g) shares of money market mutual or similar funds that invest exclusively in assets satisfying the requirements of clauses (a) through (f) of this definition; or

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

“ CBT Controlled Accounts ” means deposit accounts numbered 001-0312999, 001-0312964, and 001-0312956, respectively, established by the Borrower and maintained with Central Bank & Trust Co., which deposit accounts are subject to the Deposit Account Control Agreement dated as of September 8, 2006, among Central Bank & Trust Co., as Depository Bank, the Borrower, as Grantor, and the Administrative Agent, as Secured Party.

“ CB&T ” means Central Bank & Trust Co., a Kentucky banking corporation, and its successors and assigns.

“ CB&T Note ” means the Commercial Note dated September 28, 2007, made by the Borrower and payable to the order of CB&T in the original principal amount of $2,100,000, as in effect on the Closing Date.

“ Change in Law ” means the occurrence, after the date of this Agreement, of any of the following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation or application thereof by any Governmental Authority or (c) the making or issuance of any request, guideline or directive (whether or not having the force of law) by any Governmental Authority.

“ Closed-Access Pipeline Properties ” means all Pipeline Properties other than Open-Access Pipeline Properties.

“ Closing Date ” means the date on which the conditions precedent set forth in Section 4.01 shall have been satisfied.

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

“ Collateral ” means all property of the Loan Parties, now owned or hereafter acquired, upon which a Lien is purported to be created by any Security Document.

“ Collateral Account ” has the meaning specified in the Guarantee and Collateral Agreement.

“ Commitment ” means, as to any Lender, the obligation of such Lender, if any, to make Loans and/or issue or participate in Letters of Credit under this Agreement, in an aggregate principal and/or face amount not to exceed the amount set forth under the heading “Commitment” opposite such Lender’s name on Schedule 1.01A or in the Assignment and Assumption pursuant to which such Lender became a party hereto, as the same may be changed from time to time pursuant to the terms hereof. The original aggregate amount of the Total Commitments on the Closing Date is $75,000,000.

“ Commitment Period ” means the period from and including the Closing Date to, but not including, the Termination Date.

“ Commonly Controlled Entity ” means an entity, whether or not incorporated, that is under common control with the Borrower within the meaning of Section 4001 of ERISA or is part of a group that includes the Borrower and that is treated as a single employer under Section 414 of the Code.

“ Compliance Certificate ” means a certificate duly executed and property completed by a Responsible Officer substantially in the form of Exhibit L , or in such other form as may be required by the Administrative Agent.

“ Confidential Information Memorandum ” means the Confidential Information Memorandum dated November 2007, prepared by KeyBanc Capital Markets with respect to the Borrower and furnished to any Lender.

“ Conforming Borrowing Base ” means, at any time, the dollar amount determined in accordance with Section 2.02(e).

“ Conforming Borrowing Base Usage ” means, as of any date and for all purposes, the quotient, expressed as a percentage of (a) the Aggregate Outstanding Credit as of such date, divided by (b) the Conforming Borrowing Base as of such date.

“ Consolidated Current Assets ” means, at any date, the total of (a) all amounts that would, in conformity with GAAP, be set forth opposite the caption “total current assets” (or any like caption) on a consolidated balance sheet of the Borrower and its Subsidiaries at such date, plus (b) the Availability existing at such date, less (iii) any non-cash assets required to be included in the consolidated current assets of the Borrower and its Subsidiaries as a result of the application of SFAS 133 as of such date.

“ Consolidated Current Liabilities ” means, at any date, the total of (a) all amounts that would, in conformity with GAAP, be set forth opposite the caption “total current liabilities” (or any like caption) on a consolidated balance sheet of the Borrower and its Subsidiaries at such date, but excluding all Indebtedness consisting of Loans to the extent otherwise included therein, less (b) any non-cash obligations required to be included in the consolidated current liabilities of the Borrower and its Subsidiaries as a result of the application of SFAS 133 as of such date.

“ Consolidated EBITDA ” means, for any period, Consolidated Net Income for such period plus , without duplication and to the extent deducted in determining such Consolidated Net Income for such period, the sum of (a) cash interest expense (including cash distributed to Holdings to pay interest due and payable on the NGAS Convertible Notes), (b) income tax expense, (c) depreciation and depletion expense, (d) amortization expense, (e) any non-cash losses or charges on any Hedge Agreement resulting from the requirements of SFAS 133 for such period; and minus , to the extent included in determining such Consolidated Net Income for such period, the sum of (a) interest income, (b) any non-cash gains on any Hedge Agreements resulting from the requirements of SFAS 133 for such period, (c) any extraordinary income or gains in accordance with GAAP, (d) income tax credits (to the extent not netted from income tax expense) and (e) any other non-cash income, all as determined on a consolidated basis. For the purposes of calculating Consolidated EBITDA for any period of four consecutive Fiscal Quarters (each, a “ Reference Period ”) pursuant to any determination of the Consolidated Leverage Ratio, (i) if at any time during such Reference Period the Borrower or any Subsidiary shall have made any Material Disposition, the Consolidated EBITDA for such Reference Period shall be reduced by an amount equal to the Consolidated EBITDA (if positive) attributable to the Property that is the subject of such Material Disposition for such Reference Period or increased by an amount equal to the Consolidated EBITDA (if negative) attributable thereto for such Reference Period and (ii) if during such Reference Period the Borrower or any Subsidiary shall have made a Material Acquisition, Consolidated EBITDA for such Reference Period shall be calculated after giving pro forma effect thereto as if such Material Acquisition occurred on the first day of such Reference Period. As used in this definition, “Material Acquisition” means any acquisition of Property or series of related acquisitions of Property that (a) constitutes assets comprising all or substantially all of an operating unit of a business or constitutes all or substantially all of the common stock of a Person and (b) involves the payment of consideration by the Borrower and its Subsidiaries in excess of $5,000,000; and “Material Disposition” means any Disposition of Property or series of related Dispositions of Property that yields gross proceeds to the Borrower or any of its Subsidiaries in excess of $5,000,000.

“ Consolidated Funded Indebtedness ” means, at any date, the aggregate amount of all Funded Indebtedness of Holdings, the Borrower and its Subsidiaries at such date (excluding all Funded Indebtedness outstanding under the NGAS Convertible Notes as of such date but including all other Funded Indebtedness of Holdings outstanding as of such date).

“ Consolidated Interest Coverage Ratio ” means, for any period, the ratio of (a) Consolidated EBITDA for such period to (b) Consolidated Interest Expense for such period.

“ Consolidated Interest Expense ” means, for any period, (a) total cash interest expense (including that attributable to Capital Lease Obligations, Synthetic Lease Obligations, and Synthetic Debt) of the Borrower and its Subsidiaries for such period with respect to all outstanding Indebtedness of the Borrower and its Subsidiaries (including all commissions, discounts and other fees and charges owed with respect to letters of credit and bankers’ acceptance financing, net costs under Hedge Agreements in respect of interest rates to the extent such net costs are allocable to such period in accordance with GAAP) plus (b) all cash interest expense of Holdings for such period with respect to the NGAS Convertible Notes and any other Indebtedness of Holdings.

“ Consolidated Leverage Ratio ” means, as at the last day of any period, the ratio of (a) Consolidated Funded Indebtedness on such day to (b) Consolidated EBITDA for such period.

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

“ Continuing Directors ” means the directors of Holdings on the Closing Date, and each other director, if, in each case, such other director’s nomination for election to the board of directors of Holdings is recommended by at least 66-2/3% of the then Continuing Directors.

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

“ Credit Extension ” means (a) the making of any Loan by any Lender and (b) the issuance of any Letter of Credit by the Issuing Bank.

“ Credit Rating ” means, with respect to any Person on any date of determination, the respective rating then assigned to its unsecured and senior long-term debt or deposit obligations or (not supported by third party credit enhancement) by S&P, Moody’s, or any other nationally recognized statistical rating agency acceptable to the Administrative Agent.

“ Default ” means any of the events specified in Section 8.01, whether or not any requirement for the giving of notice, the lapse of time, or both, has been satisfied.

“ Default Rate ” means (a) when used with respect to Obligations other than Letter of Credit fees payable pursuant to Section 3.03(a), an interest rate equal to (i) the ABR plus the Applicable Margin for ABR Loans plus (ii) 2% per annum, provided , however , that with respect to a Eurodollar Loan, the Default Rate shall be an interest rate equal to the interest rate (including any Applicable Margin) otherwise applicable to such Loan plus 2% per annum and (b) when used with respect to Letter of Credit fees payable pursuant to Section 3.03(a), a rate equal to the Applicable Margin for Eurodollar Loans plus 2% per annum.

“ Defaulting Lender ” means any Lender that (a) has failed to fund any portion of the Loans or participations in LC Obligations required to be funded by it hereunder within one Business Day of the date required to be funded by it hereunder, (b) has otherwise failed to pay over to the Administrative Agent or any other Lender any other amount required to be paid by it hereunder within one Business Day of the date when due, unless the subject of a good faith dispute, or (c) has been deemed insolvent or become the subject of a bankruptcy or insolvency proceeding.

“ Deficiency Notice ” has the meaning as specified in Section 2.07(a).

“ Disbursement Letter ” means the Disbursement Letter to be executed and delivered by the Borrower, substantially in the form of Exhibit H .

“ Disposition ” means with respect to any property, any sale, lease, license, sale and leaseback, assignment, conveyance, transfer or other disposition thereof. The terms “ Dispose ” and “ Disposed of ” shall have correlative meanings.

“ Dollars ” and “ $ ” means dollars in lawful currency of the United States.

“ Drilling Program ” means any drilling, developing and operating partnership or similar arrangement between the Borrower and any Drilling Program Partnership which is created and structured by the Borrower, each such Drilling Program Partnership being owned 99% by subscribers for its units of limited or general partner interests, as investors, and 1% by the Borrower, as the managing general partner, the proceeds of which are contributed by the Drilling Program Partnership to the associated Drilling Program, along with the Borrower’s capital contribution, and applied by the Drilling Program to drill Hydrocarbon development or exploratory wells on drilling sites selected and assigned to the Drilling Program by the Borrower from its inventory of drilling prospects in the Appalachian Basin and other gas basins where it holds Hydrocarbon Interests.

“ Drilling Program Agreements ” means, with respect to any Drilling Program, the collective reference to the limited partnership agreement of the Drilling Program Partnership relating to such Drilling Program, the general partnership agreement of the Drilling Program between the Drilling Program Partnership and the Borrower, as manager, all assignments of drilling rights from the Borrower to the Drilling Program, all joint drilling and operating agreements to which the Borrower is a party relating to the Drilling Program, all investor subscription agreements to which the Drilling Program Partnership is a party relating to the Drilling Program, and all other agreements, contracts, instruments and documents governing, evidencing or relating to such Drilling Program, in each case as any of the same may be amended, restated, supplemented or otherwise modified from time to time in accordance with the Loan Documents, including, without limitation, all rights of the Borrower to (i) receive moneys due and to become due to it thereunder or in connection therewith, (ii) damages arising thereunder or in connection therewith and (iii) perform thereunder and to compel performance and otherwise exercise rights and remedies thereunder.

“ Drilling Program Partnership ” means any limited partnership created by the Borrower as part of any Drilling Program of which the Borrower is the managing general partner and that is a party to one or more Drilling Program Agreements.

“ Earned Farmout Interests ” means (a) with respect to any Existing Farmout Agreement, all “Earned Interests” (as defined in the Existing Farmout Agreement Consent relating to such Existing Farmout Agreement) and (b) with respect to any other Farmout Agreement, all rights, titles and interests of the Borrower or any Restricted Subsidiary in and to any Proved Reserves and related Property and rights that are assigned by an Approved Counterparty to the Borrower or any Restricted Subsidiary pursuant to a Farmout Property Assignment.

“ Earned Participation Interests ” means (a) with respect to the Existing Participation Agreement, all working interests and net revenue interests in oil and gas wells drilled by the Borrower that are assigned to the Borrower by Hard Rock Exploration, Inc. pursuant to any Assignments (as defined in such Existing Participation Agreement) and (b) with respect to any other Participation Agreement, all right, title and interest of the Borrower or any Restricted Subsidiary in and to any Proved Reserves and related Property and rights that are assigned by the Approved Counterparty to the Borrower or any Restricted Subsidiary pursuant to a Participation Property Assignment.

“ Electing Lender ” has the meaning specified in Section 2.02.

“ Engineering Report ” means an Independent Engineering Report or an Internal Engineering Report.

“ Environmental Laws ” means any and all foreign, Federal, state, local or municipal laws, rules, orders, regulations, statutes, ordinances, codes, decrees, requirements of any Governmental Authority or other Requirements of Law (including common law) regulating, relating to or imposing liability or standards of conduct concerning protection of human health or the environment, as now or may at any time hereafter be in effect.

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

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

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

“ Eurocurrency Reserve Requirements ” means for any day as applied to a Eurodollar Loan, the aggregate (without duplication) of the maximum rates (expressed as a decimal fraction) of reserve requirements in effect on such day (including basic, supplemental, marginal and emergency reserves under any regulations of the Board or other Governmental Authority having jurisdiction with respect thereto) dealing with reserve requirements prescribed for eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in Regulation D of the Board) maintained by a member bank of the Federal Reserve System.

“ Eurodollar Base Rate ” means, with respect to each day during each Interest Period pertaining to a Eurodollar Loan, the rate per annum equal to the British Bankers Association LIBOR Rate (“ BBA LIBOR ”), as published by Reuters (or other commercially available source providing quotations of BBA LIBOR as designated by the Administrative Agent from time to time) at approximately 11:00 a.m., London time, determined on the basis of the rate for deposits in Dollars for a period equal to such Interest Period commencing on the first day of such Interest Period two (2) Business Days prior to the beginning of such Interest Period. In the event that such rate is not available at such time for any reason, the “ Eurodollar Base Rate ” for such Interest Period shall be the rate per annum determined by reference to such other comparable publicly available service for displaying eurodollar rates as may be selected by the Administrative Agent or, in the absence of such availability, by reference to the rate at which the Administrative Agent is offered Dollar deposits at or about 11:00 A.M., New York City time, two (2) Business Days prior to the beginning of such Interest Period in the interbank eurodollar market where its eurodollar and foreign currency and exchange operations are then being conducted for delivery on the first day of such Interest Period for the number of days comprised therein.

“ Eurodollar Loans ” means Loans the rate of interest applicable to which is based upon the Eurodollar Rate.

“ Eurodollar Rate ” means, with respect to each day during each Interest Period pertaining to a Eurodollar Loan, a rate per annum determined for such day in accordance with the following formula (rounded upward to the nearest 1/100th of 1%):

Eurodollar Base Rate

“ Eurodollar Tranche ” means the collective reference to Eurodollar Loans the then current Interest Periods with respect to all of which begin on the same date and end on the same later date (whether or not such Loans shall originally have been made on the same day).

“ Event of Default ” means any of the events specified in Section 8.01, provided that any requirement for the giving of notice, the lapse of time, or both, has been satisfied.

“ Excluded Taxes ” means, with respect to the Administrative Agent, any Lender, the Issuing Bank or any other recipient of any payment to be made by or on account of any obligation of the Borrower hereunder, (a) taxes imposed on or measured by its overall net income (however denominated), and franchise taxes imposed on it (in lieu of net income taxes), by the jurisdiction (or any political subdivision thereof) under the laws of which such recipient is organized or in which its principal office is located or, in the case of any Lender, in which its applicable lending office is located, (b) any branch profits taxes imposed by the United States of America or any similar tax imposed by any other jurisdiction in which the Borrower is located and (c) in the case of a Foreign Lender (other than an assignee pursuant to a request by the Borrower under Section 2.20), any withholding tax that is imposed on amounts payable to such Foreign Lender at the time such Foreign Lender becomes a party hereto (or designates a new lending office) or is attributable to such Foreign Lender’s failure or inability (other than as a result of a Change in Law) to comply with Section 2.16(e), except to the extent that such Foreign Lender (or its Assignor, if any) was entitled, at the time of designation of a new lending office (or assignment), to receive additional amounts from the Borrower with respect to such withholding tax pursuant to Section 2.16(a). Notwithstanding anything to the contrary contained herein, Taxes (including withholding taxes) imposed by Canada or any Province or any political subdivision thereof shall not constitute Excluded Taxes.

“ Existing Farmout Agreements ” means the collective reference to (a) the Farmout Agreement, dated December 11, 2002, among Equitable Production Company and KRCC Oil & Gas, LLC, as Farmors, and the Borrower, as Farmee, (b) the Farmout Agreement, dated April 12, 1996, between Equitable Resources Energy Company, as Farmor, and the Borrower, as Farmee, and (c) the Farmout Agreement, dated October 3, 1997, between Equitable Resource Energy Company, as Farmor, and the Borrower, as Farmee, in each case, with all schedules, exhibits and annexes thereto, and each as amended and supplemented through and including the Closing Date.

“ Existing Farmout Agreement Consents ” means the collective reference to (a) that certain letter agreement, dated as of May 30, 2008, among Equitable Production Company and KRCC Oil & Gas, LLC, the Borrower and the Administrative Agent, pertaining to that certain Farmout Agreement, dated December 11, 2002, among Equitable Production Company and KRCC Oil and Gas, LLC, as Farmors, and the Borrower, as Farmee, (b) that certain letter agreement, dated as of May 30, 2008, among Equitable Resources Energy Company, the Borrower and the Administrative Agent, pertaining to that certain Farmout Agreement, dated April 12, 1996, between Equitable Resources Energy Company, as Farmor, and the Borrower, as Farmee, and (c) that certain letter agreement, dated as of May 30, 2008, among Equitable Resources Energy Company, the Borrower and the Administrative Agent, pertaining to that certain Farmout Agreement, dated October 3, 1997, between Equitable Resources Energy Company, as Farmor, and the Borrower, as Farmee.

“ Existing Lease ” shall mean any Lease to which the Borrower or any Restricted Subsidiary is a party on or prior to the Closing Date.

“ Existing Oil and Gas Mortgages ” means the collective reference to any Oil and Gas Mortgage entered into by the Borrower in favor of the Administrative Agent, for the benefit of the Secured Parties, prior to the Closing Date under and in connection with the Existing Credit Agreement.

“ Existing Participation Agreements ” means the collective reference to (a) that certain letter agreement, dated March 30, 2007, between Hard Rock Exploration, Inc. and the Borrower, including Schedule A and all exhibits thereto, as amended by the letter agreement, dated August 27, 2007, between Hard Rock Exploration, Inc. and the Borrower, and as further amended and supplemented through and including the Closing Date, (b) that certain letter agreement, dated March 25, 2008, between Hard Rock Exploration, Inc. and the Borrower, as further amended and supplemented through and including the Closing Date and (c) each Drilling and Operating Agreement, dated on or before the Closing Date, between Hard Rock Exploration, Inc. and the Borrower, in substantially the form of either Exhibit A to the letter agreement described in clause (a) above or Annex A to the letter agreement described in clause (b) above, together with all schedules and exhibits thereto, in each case as amended and supplemented prior to the Closing Date.

“ Farmout Agreement ” means each Existing Farmout Agreement and any other farmout agreement or other similar agreement (together with all exhibits and schedules thereto) by or among any Approved Counterparty, as Farmor, and the Borrower or any Restricted Subsidiary, as Farmee (a) covering or relating to Proved Reserves and related Property rights and interests owned by such Approved Counterparty and (b) pursuant to which the Borrower or such Restricted Subsidiary has or obtains by assignment rights, title and interests in and to such Proved Reserves and related Property rights and interests which interests are, in the determination of the Administrative Agent and the Lenders, interests in personal Property, as opposed to interests in real Property, under applicable state law.

“ Farmout Agreement Consent ” means each Existing Farmout Agreement Consent and any other agreement, in form and substance satisfactory to the Administrative Agent and the Lenders, among one or more Approved Counterparties, the Borrower or any Restricted Subsidiary, and the Administrative Agent, for the benefit of the Secured Parties, relating to any Farmout Agreement and Farmout Agreement Assignments made or to be made under or pursuant to such Farmout Agreement and consenting to the creation, maintenance, perfection, priority and enforcement of the Liens and other rights and remedies of the Secured Parties in and to any such Loan Party’s rights, titles and interests in and to the Farmout Properties described or referenced therein.

“ Farmout/Participation Property Certificate ” means, at any time, a certificate, substantially in the form of Exhibit Q hereto (together with each exhibit thereto), prepared by the Borrower, certified by a Responsible Officer of the Borrower and addressed to the Administrative Agent and the Lenders, with respect to the Farmout Agreements, Farmout Property Assignments, Farmout Properties, Farmout Agreement Consents, Participation Agreements, Participation Properties and Participation Agreement Consents, of the Borrower or any Restricted Subsidiary or to which the Borrower or any Restricted Subsidiary is a party at such time.

“ Farmout Properties ” means all rights, titles and interests of the Borrower and any Restricted Subsidiary in and to any Earned Farmout Interests that have been assigned and transferred to the Borrower or such Restricted Subsidiary pursuant to any Farmout Agreement and any Farmout Property Assignment.

“ Farmout Property Assignment ” means, with respect to any Farmout Agreement, an assignment, substantially in the form attached as an exhibit to such Farmout Agreement and otherwise in form and substance satisfactory to the Administrative Agent, and prepared, executed and delivered by one or more Approved Counterparties, as assignors, and the Borrower or any Restricted Subsidiary, as assignee, and providing for and evidencing the assignment of one or more Farmout Properties described therein to the Borrower or such Restricted Subsidiary, pursuant to and in accordance with such Approved Farmout Agreement.

“ FASB ” means the Financial Accounting Standards Board, and any successor thereto.

“ Federal Funds Effective Rate ” means, for any day, the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers, as published on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if such rate is not so published for any day that is a Business Day, the average of the quotations for the day of such transactions received by the Reference Lender from three federal funds brokers of recognized standing selected by it.

“ Fee Letter ” means the letter agreement, dated on or about May 30, 2008, among the Borrower, the Administrative Agent and the Arranger.

“ Fiscal Quarter ” means any of the four quarters of any Fiscal Year.

“ Fiscal Year ” means the fiscal year of the Borrower and its Subsidiaries ending on December 31 in any calendar year.

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

“ Fund ” means any Person (other than a natural person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its business.

“ Funded Indebtedness ” means, as to any Person, all Indebtedness of such Person that matures more than one (1) year from the date of its creation or matures within one year from such date but is renewable or extendible, at the option of such Person, to a date more than one year from such date or arises under a revolving credit or similar agreement that obligates the lender or lenders to extend credit during a period of more than one year from such date, including all current maturities and current sinking fund payments in respect of such Indebtedness whether or not required to be paid within one year from the date of its creation and, in the case of the Borrower, Indebtedness in respect of the Loans.

“ Funding Office ” means the principal office of the Administrative Agent in Cleveland, Ohio or such other office as may be specified from time to time by the Administrative Agent as its funding office by written notice to the Borrower and the Lenders.

“ GAAP ” means generally accepted accounting principles in the United States as in effect from time to time, except that for purposes of Section 7.01, GAAP shall be determined on the basis of such principles in effect on the date hereof and consistent with those used in the preparation of the most recent audited financial statements referred to in Section 5.01. In the event that any “Accounting Change” (as defined below) shall occur and such change results in a change in the method of calculation of financial covenants, standards or terms in this Agreement, then the Borrower and the Administrative Agent agree to enter into negotiations in order to amend such provisions of this Agreement so as to reflect equitably such Accounting Changes with the desired result that the criteria for evaluating the Borrower’s financial condition shall be the same after such Accounting Changes as if such Accounting Changes had not been made. Until such time as such an amendment shall have been executed and delivered by the Borrower, the Administrative Agent and the Required Lenders, all financial covenants, standards and terms in this Agreement shall continue to be calculated or construed as if such Accounting Changes had not occurred. “Accounting Changes” refers to changes in accounting principles required by the promulgation of any rule, regulation, pronouncement or opinion by FASB or, if applicable, the SEC.

“ Governmental Authority ” means any nation or government, any state or other political subdivision thereof, any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank), any securities exchange and any self-regulatory organization (including the National Association of Insurance Commissioners).

“ Group Members ” means the collective reference to Holdings, the Borrower and their respective Subsidiaries.

“ Guarantee Obligation ” means, as to any Person (the “ Guaranteeing Person ”), any obligation of (a) the Guaranteeing Person or (b) another Person (including any bank under any letter of credit) to induce the creation of which the Guaranteeing Person has issued a reimbursement, counterindemnity or similar obligation, in either case guaranteeing or in effect guaranteeing any Indebtedness, leases, dividends or other obligations (the “ primary obligations ”) of any other third Person (the “ primary obligor ”) in any manner, whether directly or indirectly, including any obligation of the Guaranteeing Person, whether or not contingent, (i) to purchase any such primary obligation or any property constituting direct or indirect security therefor, (ii) to advance or supply funds (1) for the purchase or payment of any such primary obligation or (2) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor, (iii) to purchase property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation or (iv) otherwise to assure or hold harmless the owner of any such primary obligation against loss in respect thereof; provided , however , that the term Guarantee Obligation shall not include endorsements of instruments for deposit or collection in the ordinary course of business. The amount of any Guarantee Obligation of any Guaranteeing Person shall be deemed to be the lower of (a) an amount equal to the stated or determinable amount of the primary obligation in respect of which such Guarantee Obligation is made and (b) the maximum amount for which such Guaranteeing Person may be liable pursuant to the terms of the instrument embodying such Guarantee Obligation, unless such primary obligation and the maximum amount for which such Guaranteeing Person may be liable are not stated or determinable, in which case the amount of such Guarantee Obligation shall be such Guaranteeing Person’s maximum reasonably anticipated liability in respect thereof as determined by the Borrower in good faith.

“ Guarantee and Collateral Agreement ” means the Amended and Restated Guarantee and Collateral Agreement, dated on or about the Closing Date, to be executed and delivered by the Borrower and each Restricted Subsidiary, substantially in the form of Exhibit A .

“ Guarantors ” means the collective reference to Holdings and the Restricted Subsidiaries.

“ Hazardous Materials ” means (a) petroleum or petroleum products, by-products or breakdown products, radioactive materials, asbestos-containing materials, polychlorinated biphenyls and radon gas and (b) any other chemicals, materials or substances designated, classified or regulated as hazardous or toxic or as a pollutant or contaminant under any Environmental Law.

“ Hedge Agreement ” means any agreement with respect to any swap, forward, future or derivative transaction or option or similar agreement, whether exchange-traded, “over-the-counter” or otherwise, and whether settled in cash or settled by physical delivery (including any agreement with respect to any forward purchase or sale of any Hydrocarbons), involving, or settled by reference to, one or more rates, currencies, commodities, equity or debt instruments or securities, or economic, financial or pricing indices or measures of economic, financial or pricing risk or value or any similar transaction or any combination of these transactions.

“ Hedge Bank ” means any Lender or any Affiliate of a Lender that is a counterparty to a Hedge Agreement with the Borrower or any Restricted Subsidiary.

“ Hedge Bank Obligations ” means all obligations of the Borrower or any Restricted Subsidiary arising from time to time under any Hedge Agreement with a Hedge Bank; provided that (a) if such Hedge Bank ceases to be a Lender or an Affiliate of a Lender hereunder, the Hedge Bank Obligations owed to such Hedge Bank shall no longer be secured or guaranteed under any Loan Document and (b) for any Hedge Bank Obligations to be secured or guaranteed under any Loan Document, the applicable Hedge Bank (other than KeyBank or an Affiliate of KeyBank) must have provided the Administrative Agent written notice of the existence thereof and such transaction must not otherwise be prohibited under this Agreement.

“ Hedge Termination Value ” means, in respect of any one or more Hedge Agreements, after taking into account the effect of any legally enforceable netting agreement contained in or relating to such Hedge Agreements, (a) for any date on or after the date such Hedge Agreements have been closed out and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for such Hedge Agreements, as determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Hedge Agreements (which may include a Lender or any Affiliate of a Lender).

“ Highest Lawful Rate ” means, with respect to the Administrative Agent, the Issuing Bank or any Lender, the maximum nonusurious interest rate, if any, that at any time or from time to time may be contracted for, taken, reserved, charged or received on the Obligations under laws applicable to the Administrative Agent, the Issuing Bank or such Lender which are currently in effect or, to the extent allowed by law, under such applicable laws which may hereafter be in effect and which allow a higher maximum nonusurious interest rate than applicable laws now allow.

“ Holdings ” has the meaning specified in the preamble hereto.

“ Holdings Guarantee ” means the Amended and Restated Holdings Guarantee to be executed and delivered by Holdings, in substantially the form of Exhibit M .

“ Holdings Pledge Agreement ” means the Amended and Restated Holdings Pledge Agreement to be executed and delivered by Holdings, in substantially the form of Exhibit N .

“ Hydrocarbons ” means oil, gas, coal seam gas, casinghead gas, drip gasoline, natural gasoline, condensate, distillate, and all other liquid and gaseous hydrocarbons and all products, by-products, and other substances derived, produced, refined, separated, settled and dehydrated therefrom or the processing thereof, and all other minerals and substances produced in conjunction with such substances, including kerosene, liquefied petroleum gas, refined lubricating oils, diesel fuel, helium, sulfur, geothermal steam, water, carbon dioxide, and any and all minerals, ores, or substances of value and the products therefrom.

“ Hydrocarbon Interests ” means all rights, titles, interests and estates now owned or hereafter acquired in and to all Leases, fee mineral interests, term mineral interests, farm-outs, overriding royalty and royalty interests, net profit interests, carried interests, oil payments, production payments and similar mineral interests, and all unsevered and unextracted Hydrocarbons in, under or attributable to any such oil and gas Properties and all other reserved or residual interests of whatever nature.

“ Increased Facility Activation Notice ” means a notice in substantially the form of Exhibit O .

“ Increased Facility Closing Date ” means any Business Day designated as such in an Increased Facility Activation Notice.

“ Indebtedness ” means, with respect to any Person, without duplication:

(a) all indebtedness of such Person for borrowed money;

(b) all obligations of such Person for the deferred purchase price of property or services (other than trade payables incurred in the ordinary course of such Person’s business that are not past due by more than sixty (60) days after the date on which such trade payable was created);

(c) all obligations of such Person evidenced by notes, bonds, debentures or other similar instruments;

(d) all indebtedness 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 or sale of such property);

(e) all Attributable Indebtedness in respect of Capital Lease Obligations and Synthetic Lease Obligations of such Person and all Synthetic Debt of such Person;

(f) the maximum amount of all obligations of such Person, contingent or otherwise, with respect to bankers’ acceptances, letters of credit, letters of guaranty, surety bonds, performance bonds and similar obligations;

(g) all obligations of such Person to purchase, redeem, retire, defease or otherwise make any payment in respect of any Equity Interests in such Person or any other Person, valued, in the case of the redeemable Preferred Interests, at the greater of its voluntary or involuntary liquidation preference plus all accrued and unpaid dividends;

(h) all obligations with respect to payments received in consideration of Hydrocarbons yet to be acquired or produced at the time of payment (including obligations under “take-or-pay” contracts to deliver gas in return for payments already received and the undischarged balance of any volumetric or other production payment created by such Person or for the creation of which such Person directly or indirectly received payment);

(i) all obligations of such Person in respect of Hedge Agreements, valued at the Hedge Termination Value thereof;

(j) all Guarantee Obligations of such Person in respect of obligations of the kind referred to in clauses (a) through (i) above; and

(k) all obligations of the kind referred to in clauses (a) through (i) above secured by (or for which the holder of such obligation has an existing right, contingent or otherwise, to be secured by) any Lien on property (including accounts and contract rights) owned by such Person, whether or not such Person has assumed or become liable for the payment of such obligation.

The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such entity, except to the extent the terms of such Indebtedness expressly provide that such Person is not liable therefor.

“ Indemnified Taxes ” means Taxes other than Excluded Taxes.

“ Independent Engineer ” means Wright & Associates or any other engineering firm reasonably acceptable to the Administrative Agent.

“ Independent Engineering Report ” means a report, in form and substance reasonably satisfactory to the Administrative Agent and each of the Lenders, prepared by an Independent Engineer, addressed to the Administrative Agent and the Lenders with respect to the Oil and Gas Properties owned by the Borrower and its Restricted Subsidiaries (or to be acquired by the Borrower or any of its Restricted Subsidiaries, as applicable) which report shall (a) specify the location and quantity of the Proved Properties, Farmout Properties, and Participation Properties attributable to such Oil and Gas Properties and separately report on the Proved Developed Producing Reserves, Proved Developed Nonproducing Reserves, Proved Undeveloped Reserves and probable reserves attributable to such Oil and Gas Properties, (b) use and contain projections of future rates of production of such Oil and Gas Properties, (c) contain estimates of the net operating revenues to be derived from the production and sale of Hydrocarbons from such Proved Reserves based on pricing and cost escalation assumptions, discount factors and other economic assumptions and parameters that are established by or acceptable to the Administrative Agent and the Lenders, (d) identify and take into account any “over-produced” or “under-produced” status under gas balancing agreements, (e) take into account actual experience with leasehold operating expenses and other costs in determining projected leasehold operating expenses and other costs, and (f) contain such other information and data regarding such Oil and Gas Properties as is customarily obtained from and provided in such reports or is otherwise reasonably requested by the Administrative Agent or any Lender.

“ Initial Borrowing Base ” has the meaning specified in Section 2.02(a).

“ Initial Conforming Borrowing Base ” has the meaning specified in Section 2.02(e).

“ Initial Engineering Report ” has the meaning specified in Section 4.01(e).

“ Initial Farmout / Participation Property Certificate ” has the meaning specified in Section 4.01(f).

“ Insolvency ” means, with respect to any Multiemployer Plan, the condition that such Plan is insolvent within the meaning of Section 4245 of ERISA.

“ Insolvent ” means pertaining to a condition of Insolvency.

“ Intellectual Property ” means the collective reference to all rights, priorities and privileges relating to intellectual property, whether arising under United States, multinational or foreign laws or otherwise, including copyrights, copyright licenses, patents, patent licenses, trademarks, trademark licenses, technology, know-how and processes, and all rights to sue at law or in equity for any infringement or other impairment thereof, including the right to receive all proceeds and damages therefrom.

“ Intellectual Property Security Agreement ” has the meaning specified in the Guarantee and Collateral Agreement.

“ Interest Payment Date ” means (a) as to any ABR Loan, the last day of each March, June, September and December to occur while such Loan is outstanding and the Termination Date, (b) as to any Eurodollar Loan having an Interest Period of three months or less, the last day of such Interest Period and the Termination Date, (c) as to any Eurodollar Loan having an Interest Period longer than three months, each day that is three months, or a whole multiple thereof, after the first day of such Interest Period and the last day of such Interest Period and the Termination Date, and (d) as to any Loan (other than any Loan that is an ABR Loan), the date of any repayment or prepayment made in respect thereof.

“ Interest Period ” means, as to any Eurodollar Loan, (a) initially, the period commencing on the borrowing or conversion date, as the case may be, with respect to such Eurodollar Loan and ending one, two, three or six months thereafter, as selected by the Borrower in its notice of borrowing or notice of conversion, as the case may be, given with respect thereto; and (b) thereafter, each period commencing on the last day of the next preceding Interest Period applicable to such Eurodollar Loan and ending one, two, three or six months thereafter, as selected by the Borrower by irrevocable notice to the Administrative Agent not less than three Business Days prior to the last day of the then current Interest Period with respect thereto; provided that, all of the foregoing provisions relating to Interest Periods are subject to the following:

(i) if any Interest Period would otherwise end on a day that is not a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless the result of such extension would be to carry such Interest Period into another calendar month in which event such Interest Period shall end on the immediately preceding Business Day;

(ii) the Borrower may not select an Interest Period that would extend beyond the Termination Date;

(iii) any Interest Period that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of a calendar month; and

(iv) the Borrower shall select Interest Periods so as not to require a payment or prepayment of any Eurodollar Loan during an Interest Period for such Loan.

“ Internal Engineering Report ” means a report, in form and substance reasonably satisfactory to the Administrative Agent and each Lender, prepared by the Borrower, certified by a Responsible Officer of the Borrower and addressed to the Administrative Agent and the Lenders, with respect to the Oil and Gas Properties owned by the Borrower and any of its Restricted Subsidiaries (or to be acquired by the Borrower and any of its Restricted Subsidiaries, as applicable), which report shall (a) specify the location and quantity of the Proved Properties, Farmout Properties and Participation Properties attributable to such Oil and Gas Properties and separately report on the Proved Developed Producing Reserves, Proved Developed Nonproducing Reserves, Proved Undeveloped Reserves and probable reserves attributable to such Oil and Gas Properties, (b) use and contain projections of future rates of production of such Oil and Gas Properties, (c) contain estimates of the net operating revenues to be derived from the production and sale of Hydrocarbons from such Proved Reserves based on pricing and cost escalation assumptions, discount factors and other economic assumptions and parameters that are established by or acceptable to the Administrative Agent and the Lenders, (d) identify and take into account any “over-produced” or “under-produced” status under gas balancing agreements, (e) take into account actual experience with leasehold operating expenses and other costs in determining projected leasehold operating expenses and other costs, and (f) contain such other information and data regarding such Oil and Gas Properties as is customarily obtained from and provided in such reports or is otherwise reasonably requested by the Administrative Agent or any Lender.

“ Investment ” means, with respect to any Person, any direct or indirect acquisition or investment by such Person whether by means of (a) the purchase or other acquisition of any Equity Interest of another Person, (b) the purchase or other acquisition (in one transaction or a series of transactions) of assets of another Person that constitute a business unit or all or a substantial part of the business of such Person, (c) any loan, advance, deposit, extension of credit or capital contribution to, assumption of debt of, or purchase or other acquisition of any other debt of or interest in, another Person, (d) any Guarantee Obligation incurred by that Person in respect of Indebtedness of any other Person, and (e) any other investment by that Person in any other Person. For purposes of covenant compliance, the amount of any Investment shall be the amount actually invested, without adjustment for subsequent increases or decreases in the value of such Investment.

“ IP Security Agreement Supplement ” has the meaning specified in the Guarantee and Collateral Agreement.

“ ISP98 ” means the “International Standby Practices 1998” published by the Institute of International Banking Law & Practice, as the same may be amended from time to time.

“ Issuing Bank ” means KeyBank in its capacity as issuer of Letters of Credit hereunder.

“ KeyBank ” means KeyBank National Association.

“ LC Commitment ” means $5,000,000.

“ LC Fee Payment Date ” means the last day of each March, June, September and December and the last day of the Commitment Period.

“ LC Obligations ” means, at any time, an amount equal to the sum of (a) the aggregate then undrawn and unexpired amount of the then outstanding Letters of Credit and (b) the aggregate amount of drawings under Letters of Credit that have not been reimbursed pursuant to Section 3.05.

“ LC Participants ” means the collective reference to all the Lenders other than the Issuing Bank.

“ LC Reimbursement Obligation ” means the obligation of the Borrower to reimburse the Issuing Bank pursuant to Section 3.05 for amounts drawn under Letters of Credit.

“ Leases ” means all oil and gas leases, oil, gas and mineral leases, oil, gas and casinghead gas leases or any other instruments, agreements, assignments or conveyances under and pursuant to any of the foregoing, under which the Borrower or any Restricted Subsidiary which is a party thereto has or obtains the right to enter upon lands and explore for, drill, and develop such lands for the production of Hydrocarbons.

“ Lenders ” has the meaning specified in the preamble hereto. Unless the context otherwise requires, the term “Lender” includes the Issuing Bank.

“ Letters of Credit ” has the meaning specified in Section 3.01(a).

“ Lien ” means any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge or other security interest or any preference, priority or other security agreement or preferential arrangement of any kind or nature whatsoever (including any conditional sale or other title retention agreement, any capital lease having substantially the same economic effect as any of the foregoing, and any easement, right of way or other encumbrance on title to real property).

“ Loan ” has the meaning specified in Section 2.01.

“ Loan Documents ” means this Agreement, the Notes, the Applications, and the Security Documents.

“ Loan Parties ” means each Group Member that is or hereafter becomes a party to a Loan Document.

“ Material Adverse Effect ” means a material adverse effect on (a) the business, property, operations, condition (financial or otherwise) or prospects of the Borrower and its Restricted Subsidiaries taken as a whole, (b) the validity or enforceability of this Agreement or any of the other Loan Documents or the rights or remedies of the Administrative Agent or the or Lenders under any Loan Document, (c) the validity, perfection or priority of any Lien granted pursuant to the Security Documents, or (d) the ability of any Loan Party to perform its obligations under any Loan Document to which it is or is to be a party.

“ Material Contracts ” means the collective reference to each Farmout Agreement, each Participation Agreement, each Lease, and each other agreement or contract of the Borrower or any Restricted Subsidiary which (a) involves consideration to the Borrower or any Restricted Subsidiary of $500,000 or more in any year, (b) involves consideration by the Borrower or any Restricted Subsidiary of $500,000 or more in any year, (c) imposes financial obligations on the Borrower or any Restricted Subsidiary of $500,000 or more in any year, (d) is a Hedge Agreement or (e) is otherwise material (or together with related agreements and contracts, is material) to the business, operations, financial condition, performance or properties of the Borrower and its Restricted Subsidiaries taken as a whole.

“ Moody’s ” means Moody’s Investors Service, Inc., and any successor thereto that is a nationally recognized rating agency.

“ Mortgaged Properties ” means all Oil and Gas Properties of the Borrower and its Restricted Subsidiaries as to which the Administrative Agent, for the benefit of the Secured Parties, is or shall be granted a Lien pursuant to the Mortgages (and, with respect to any Farmout Properties and any Participation Properties, the Guarantee and Collateral Agreement).

“ Mortgages ” means collective reference to all Oil and Gas Mortgages and all Pipeline Mortgages.

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

“ New Lender ” has the meaning specified in Section 2.01(d).

“ New Lender Supplement ” has the meaning specified in Section 2.01(d).

“ New Oil and Gas Mortgages ” means the collective reference to all Oil and Gas Mortgages entered into by the Borrower or any Restricted Subsidiary on the Closing Date (including, without limitation, any Oil and Gas Mortgage which amends, or amends and restates, any Existing Oil and Gas Mortgage).

“ NGAS Convertible Notes ” means the Notes issued by Holdings pursuant to the NGAS Securities Purchase Agreement, issued prior to and as in effect on the Original Closing Date.

“ NGAS Gathering ” means NGAS Gathering, LLC, a Kentucky limited liability company.

“ NGAS Gathering Pipeline Properties ” means the collective reference to the Pipeline Properties purchased by NGAS Gathering from Duke Energy Gas Services, LLC pursuant to the NGAS Gathering Pipeline Property Acquisition Agreements and that are owned by NGAS Gathering or the Borrower on the Closing Date.

“ NGAS Gathering Pipeline Property Acquisition Agreements ” means that certain Asset Purchase and Sale Agreement dated as of January 17, 2006, between NGAS Gathering and Duke Energy Gas Services, LLC, a Kentucky limited liability company, and all existing exhibits, schedules, and annexes thereto, all other agreements, instruments and documents relating thereto, and any and all amendments to any and all of the foregoing.

“ NGAS Registration Rights Agreement ” means the Registration Rights Agreement dated as of December 13, 2005, among Holdings and the Buyers specified therein, as in effect on the Closing Date.

“ NGAS Securities Purchase Agreement ” means the Securities Purchase Agreement dated as of December 13, 2005, among Holdings and the Investors specified therein, as in effect on the Closing Date.

“ NGAS Securities Purchase Documents ” means the NGAS Securities Purchase Agreement, the NGAS Convertible Notes, the NGAS Registration Rights Agreement, and all other agreements, instruments and documents relating to any of the foregoing, each as in effect on the Closing Date.

“ Non-Appalachian State ” means any State within the United States (other than Kentucky, Tennessee, Virginia and West Virginia).

“ Note ” has the meaning specified in Section 2.19(d).

“ Notice of Borrowing ” means a Notice of Borrowing, substantially in the form of Exhibit K .

“ Notice of Conversion/Continuation ” means a Notice of Conversion/Continuation, substantially in the form of Exhibit G .

“ Obligations ” means the unpaid principal of and interest on (including interest accruing after the maturity of the Loans and LC Reimbursement Obligations and interest accruing after the filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or like proceeding, relating to any Loan Party, whether or not a claim for post-filing or post-petition interest is allowed in such proceeding) the Loans and LC Reimbursement Obligations and all other obligations, indebtedness and liabilities of the Loan Parties to the Secured Parties and each of them, whether direct or indirect, absolute or contingent, due or to become due, or now existing or hereafter incurred, which may arise under, out of, or in connection with, this Agreement, any other Loan Document, the Letters of Credit, any Hedge Bank Obligations, or any other document, instrument or agreement made, delivered or given in connection herewith or therewith, whether on account of principal, interest, reimbursement obligations, guarantee obligations, fees, indemnities, costs, expenses (including all fees, charges and disbursements of counsel to the Administrative Agent or to any Secured Party that are required to be paid by the Loan Parties pursuant to any Loan Document) or otherwise.

“ Oil and Gas Mortgages ” means the collective reference to all Existing Oil and Gas Mortgages, all New Oil and Gas Mortgages, all Additional Oil and Gas Mortgages, all Supplemental Oil and Gas Mortgages and all other mortgages, deeds of trust, and other documents made by the Borrower or any Restricted Subsidiary in favor of, or for the benefit of, the Administrative Agent, for the benefit of the Secured Parties, substantially in the form of Exhibit C-1 (with such changes thereto as shall be advisable under the law of the jurisdiction in which such mortgage, deed of trust, assignment of production or other document is to be recorded) or in such other form as may be reasonably acceptable to the Administrative Agent, which creates a Lien on any Proved Properties, Farmout Properties, Participation Properties or other Oil and Gas Properties (other than Pipeline Properties) from time to time.

“ Oil and Gas Properties ” means (a) all Hydrocarbon Interests (including all Proved Properties); (b) all Properties now or hereafter pooled or unitized with any Hydrocarbon Interests; (c) all Farmout Properties and all Participation Properties; (d) all operating agreements, assignments and other contracts, including production sharing contracts and agreements, which relate to any of the Hydrocarbon Interests or the production, sale, purchase, exchange or processing of Hydrocarbons from or attributable to such Hydrocarbon Interests; (e) all existing and future unitization, pooling agreements and declarations of pooled units and the units created thereby (including, without limitation, all units created under orders, regulations and rules of any Governmental Authority) which may affect all or any portion of the Hydrocarbon Interests; (f) all Pipeline Properties and all other pipelines, gathering lines, compression facilities, tanks and processing plants; (g) all oil wells, gas wells, water well, injection wells, platforms, spars or other offshore facilities, casings, rods, tubing, pumping units and engines, christmas trees, derricks, separators, gun barrels, flow lines, gas systems (for gathering, treating and compression), and water systems (for treating, disposal and injection); (h) all interests held in royalty trusts whether presently existing or hereafter created; (i) all Hydrocarbons in and under and which may be produced, saved, processed or attributable to the Hydrocarbon Interests, including all lands covered thereby, including all Hydrocarbons in pipelines, gathering lines, tanks and processing plants and all rents, issues, profits, proceeds, products, revenues and other incomes from or attributable to the Hydrocarbon Interests; (j) all tenements, hereditaments, appurtenances and Properties in any manner appertaining, belonging, affixed or incidental to the Hydrocarbon Interests; (k) all Properties, rights, titles, interests and estates described or referred to above, including any and all Property, real or personal, now owned or hereafter acquired and situated upon, used, held for use or useful in connection with the operating, working or development of any of such Hydrocarbon Interests or Property (excluding any drilling rigs, automotive equipment, rental equipment or other Property that may be located on such premises for the purpose of drilling a well or for other temporary uses) and including all oil wells, gas wells, injection wells and other wells, buildings, structures, fuel separators, liquid extraction plants, plant compressors, pumps, pumping units, field gathering systems, tanks and tank batteries, fixtures, valves, fittings, machinery and parts, engines, boilers, meters, apparatus, equipment, appliances, tools, implements, cables, wires, towers, casing, tubing and rods, surface leases, rights-of-way, easements and servitudes together with all additions, substitutions, replacements, accessions and attachments to any and all of the foregoing together with all additions, substitutions, replacements, accessions and attachments to any of the foregoing; and (l) all oil, gas and mineral leasehold, fee and term interests, overriding royalty interests, mineral interests, royalty interests, net profits interests, net revenue interests, oil payments, production payments, carried interests, leases, subleases, farm-outs and all other interests in Hydrocarbons; in each case for any Property described in clauses (a) through (k) above, whether now owned or hereafter acquired directly or indirectly.

“ Oil and Gas Property Certificate ” means, at any time, a certificate, substantially in the form of Exhibit R hereto (together with each exhibit thereto), prepared by the Borrower, certified by a Responsible Officer of the Borrower and addressed to the Administrative Agent and the Lenders, with respect to the Oil and Gas Properties of the Borrower or any Restricted Subsidiary.

“ Oil and Gas Property Description Information ” means all information necessary or required for the purpose of adequately describing the Oil and Gas Properties of the Borrower and its Restricted Subsidiaries in order for the Administrative Agent and the Lenders to (a) identify and determine the value of such Oil and Gas Properties and (b) obtain and maintain an Acceptable Lien (or, to the extent permitted hereunder, other Lien) on such Oil and Gas Properties, in each case as determined by the Administrative Agent and the Lenders in its and their sole discretion.

“ Oil and Gas Property Title Information ” means all land records, title opinions, title searches, title reports, Lien searches, abstracts and other information necessary or desirable, in the determination of the Administrative Agent and the Lenders in its and their sole discretion, to establish, verify, and evaluate the status of rights, titles and interests of the Borrower and its Restricted Subsidiaries in and to their respective Oil and Gas Properties.

“ Open-Access Pipeline Properties ” means all NGAS Gathering Pipeline Properties and any similar Pipeline Properties owned by the Borrower or any Restricted Subsidiary which are used to transport volumes of oil and gas which transportation generates revenues to the Borrower or such Restricted Subsidiary, as determined by the Administrative Agent and the Lenders from time to time in its and their sole discretion.

“ Organizational Documents ” means, (a) with respect to any corporation, the certificate or articles of incorporation and the bylaws (or equivalent or comparable constitutive documents with respect to any non-U.S. jurisdiction); (b) with respect to any limited liability company, the certificate or articles of formation or organization and operating agreement; and (c) with respect to any partnership, joint venture, trust or other form of business entity, the partnership, joint venture or other applicable agreement of formation or organization and any agreement, instrument, filing or notice with respect thereto filed in connection with its formation or organization with the applicable Governmental Authority in the jurisdiction of its formation or organization and, if applicable, any certificate or articles of formation or organization of such entity.

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

“ Outstanding Credit ” means, with respect to any Lender at any time, an amount equal to the sum of (a) aggregate principal amount of all Loans held by such Lender then outstanding and (b) such Lender’s Borrowing Base Commitment Percentage of all LC Obligations then outstanding.

“ Participant ” has the meaning specified in Section 10.06(d).

“ Participation Agreement ” means the Existing Participation Agreements and any other participation agreement or other similar agreement (other than Farmout Agreements) (together with all exhibits and schedules thereto) by or among any Approved Counterparty and the Borrower or any Restricted Subsidiary (a) covering or relating to Proved Reserves and related Property rights and interests owned by such Approved Counterparty and (b) pursuant to which the Borrower or any Restricted Subsidiary has or obtains by assignment rights, titles and interests in and to such Proved Reserves and related Property rights and interests which rights, titles and interests are, in the determination of the Administrative Agent and the Lenders, interests in personal Property, as opposed to interests in real Property, under applicable state law.

“ Participation Agreement Consent ” means any agreement, in form and substance satisfactory to the Administrative Agent and the Lenders, among one or more Approved Counterparties, the Borrower or any Restricted Subsidiary, and the Administrative Agent, for the benefit of the Secured Parties, relating to any Participation Agreement and any Participation Agreement Assignments made or to be made under or pursuant to such Participation Agreement and consenting to the creation, maintenance, perfection and enforcement of the Liens and other rights and remedies of the Secured Parties in and to any such Loan Party’s rights, titles and interests in and to the Participation Properties described or referenced therein.

“ Participation Properties ” means all rights, titles and interests of the Borrower and any Restricted Subsidiary in and to any Earned Participation Interests that have been assigned and transferred to the Borrower or such Restricted Subsidiary pursuant to any Participation Agreement and any Participation Property Assignment.

“ Participation Property Assignment ” means, with respect to any Participation Agreement, an assignment, substantially in the form attached as an exhibit to such Participation Agreement and otherwise in form and substance satisfactory to the Administrative Agent, and prepared, executed and delivered by one or more Approved Counterparties, as assignors, and the Borrower or any Restricted Subsidiary, as assignee, and providing for and evidencing the assignment of one or more Participation Properties described therein to the Borrower or such Restricted Subsidiary, pursuant to and in accordance with such Approved Participation Agreement.

“ PBGC ” means the Pension Benefit Guaranty Corporation established pursuant to Subtitle A of Title IV of ERISA (or any successor).

“ Permitted Liens ” has the meaning specified in Section 7.03.

“ Person ” means a natural person, partnership, corporation, limited liability company, business trust, joint stock company, trust, unincorporated association, joint venture, Governmental Authority or other entity of whatever nature.

“ Pipeline Mortgages ” means the collective reference to all mortgages, deeds of trust, Supplemental Pipeline Mortgages, assignments and other documents made by the Borrower or any Restricted Subsidiary in favor of, or for the benefit of, the Administrative Agent, for the benefit of the Secured Parties, substantially in the form of Exhibit C-2 (with such changes thereto as shall be advisable under the laws of the jurisdiction in which such mortgage, deed of trust or other document is to be recorded) or in such other form as may be reasonably acceptable to the Administrative Agent, which creates a Lien on any Pipeline Properties.

“ Pipeline Properties ” means all pipelines, gathering lines, compression facilities, tanks and processing plants now owned or hereafter acquired directly or indirectly by the Borrower and any Restricted Subsidiary (including, without limitation, all Open-Access Pipeline Properties).

“ Plan ” means at a particular time, any employee benefit plan that is covered by ERISA and in respect of which the Borrower or a Commonly Controlled Entity is (or, if such plan were terminated at such time, would under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.

“ Pledged Equity Interests ” has the meaning specified in the Guarantee and Collateral Agreement.

“ Pledged Notes ” has the meaning specified in the Guarantee and Collateral Agreement.

“ Post-Closing Date ” has the meaning specified in Section 6.19(c).

“ Preferred Interests ” means, with respect to any Person, Equity Interests issued by such Person that are entitled to a preference or priority over any other Equity Interests issued by such Person upon any distribution of such Person’s property and assets, whether by dividend or upon liquidation.

“ Property ” of any Person means any property or assets (whether real, personal, or mixed, tangible or intangible) of such Person.

“ Proved Properties ” means all Proved Reserves owned by the Borrower and its Restricted Subsidiaries or in which the Borrower or any Restricted Subsidiary has any right, title or interest pursuant to any Leases or any other agreements and which rights, title and interests constitute, in the determination of the Administrative Agent and the Lenders, rights, titles and interests in and to real Property under applicable state law.

“ Proved Reserves ” means “Proved Reserves” as defined in the Definitions for Oil and Gas Reserves (in this paragraph, the “ Definitions ”) promulgated by the Society of Petroleum Engineers (or any generally recognized successor) as in effect at the time in question. As used in this Agreement or any other Loan Document, “Proved Developed Producing Reserves” means Proved Reserves which are categorized as both “Developed” and “Producing” in the Definitions, “Proved Developed Nonproducing Reserves” means Proved Reserves which are categorized as both “Developed” and “Nonproducing” in the Definitions, and “Proved Undeveloped Reserves” means Proved Reserves which are categorized as “Undeveloped” in the Definitions, provided that the following criteria shall also apply to Proved Developed Producing Reserves: (a) no reserves shall be classified as Proved Developed Producing Reserves until a minimum of forty-five (45) days of production have occurred in at least one consecutive period of sixty (60) days following any operation, workover or capital expenditure, and (b) during such forty-five (45) days of production, the well relating to such reserves must be tested a minimum of three (3) times for at least twenty-four (24) hours of continuous duration.

“ Reference Lender ” means KeyBank.

“ Register ” has the meaning specified in Section 10.06(c).

“ Regulation U ” has the meaning specified in Regulation U of the Board as in effect from time to time.

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

“ Reorganization ” means, with respect to any Multiemployer Plan, the condition that such plan is in reorganization within the meaning of Section 4241 of ERISA.

“ Reportable Event ” means any of the events set forth in Section 4043(c) of ERISA, other than those events as to which the thirty day notice period is waived under subsections .27, .28, .29, .30, .31, .32, .34 or .35 of PBGC Reg. § 4043.

“ Required Lenders ” means, at any time, (a) if more than two (2) Lenders are party to this Agreement, the holders of at least 66-2/3% of the Total Commitments then in effect or, if the Commitments have been terminated, the Aggregate Outstanding Credit then outstanding or (b) if two (2) or fewer Lenders are party to this Agreement, all of the Lenders; provided , however , that the Commitments of, and aggregate outstanding Loans and LC Obligations held or deemed held by, a Defaulting Lender shall be excluded for purposes of making a determination of Required Lenders.

“ Requirement of Law ” means, as to any Person, the Organizational Documents of such Person, and any law, treaty, rule or regulation or determination of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject.

“ Responsible Officer ” means the chief executive officer, president or chief financial officer of a Loan Party. Any document delivered hereunder that is signed by a Responsible Officer of a Loan Party shall be conclusively presumed to have been authorized by all necessary corporate, partnership and/or other action on the part of such Loan Party and such Responsible Officer shall be conclusively presumed to have acted on behalf of such Loan Party.

“ Restricted Account ” means any deposit account of the Borrower that is a segregated account established with Central Bank & Trust Co. (a) for the benefit of investors in its Drilling Program Partnerships, to hold (i) subscriptions from such investors in escrow pending the closing of the offering and sale of limited and general partnership interests in the Drilling Program Partnerships (which funds are released to the associated Drilling Program as capital contributions at one or incremental closings) or (ii) investor funds segregated solely for the purpose of paying drilling costs and expenses pursuant to Drilling Program Agreements; (b) for the benefit of Drilling Programs, to hold production proceeds segregated solely for the purpose and in the amount necessary to pay the Drilling Program’s proportionate share of the costs for plugging, abandoning and reclaiming wells pursuant to the terms and conditions of the Drilling Program Agreements; and (c) for the benefit of investors entitled to periodic cash distributions from Drilling Program Partnerships and holders of royalty and overriding royalty interests, to hold production proceeds segregated solely for the purpose and in the amount necessary to make distributions to such investors in Drilling Program Partnerships pursuant to the terms and conditions of the Drilling Program Agreements and to such holders of royalty interests under the instruments governing the Hydrocarbon Interests of the Borrower.

“ Restricted Payment ” means any dividend or other distribution (whether in cash, securities or other property) with respect to any capital stock or other Equity Interest of any Person or any of its Subsidiaries, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, defeasance, acquisition, cancellation or termination of any such capital stock or other Equity Interest, or on account of any return of capital to any Person’s stockholders, partners or members (or the equivalent of any thereof), or any option, warrant or other right to acquire any such dividend or other distribution or payment.

“ Restricted Subsidiary ” means NGAS Gathering and each present and future direct and indirect Subsidiary of the Borrower that is not an Unrestricted Subsidiary.

“ S&P ” means Standard & Poor’s Ratings Group, a division of The McGraw-Hill Companies, Inc., and any successor that is a nationally recognized statistical rating agency.

“ SEC ” means the Securities and Exchange Commission, any successor thereto and any analogous Governmental Authority.

“ Secured Parties ” means the collective reference to the Administrative Agent, the Issuing Bank, the Lenders, the Hedge Banks, and each co-agent or sub-agent appointed by the Administrative Agent from time to time pursuant to any Security Document. Notwithstanding anything to the contrary contained herein or in any other Loan Document, the Hedge Banks, in their capacity as such, shall have no rights in connection with the management or release of any Collateral or the obligations of any Loan Party under any Loan Document.

“ Security Documents ” means the collective reference to the Guarantee and Collateral Agreement, the Holdings Guarantee, the Holdings Pledge Agreement, the Intellectual Property Security Agreement, the IP Security Agreement Supplement, the Mortgages, the Transfer Letters and all other security documents hereafter delivered to the Administrative Agent that create or purport to create a Lien in favor of the Administrative Agent for the benefit of the Secured Parties.

“ SFAS 133 ” means Statement of Financial Accounting Standard 133, Accounting for Derivative Instruments and Hedging Activities , adopted by FASB, as amended, restated, supplemented or otherwise modified from time to time.

“ Single Employer Plan ” means any Plan that is subject to Title IV of ERISA, but that is not a Multiemployer Plan.

“ Solvency Event ” means, with respect to any Person that is a party to any Farmout Agreement or Participation Agreement (other than the Borrower or any Restricted Subsidiary), the occurrence of any event or circumstance involving, with respect to or attributable to such Person which is similar to any event or circumstance described in Section 8.01(f) of this Agreement.

“ Solvent ” means, with respect to any Person as of any date of determination, that on such date (a) the amount of the “present fair saleable value” of the assets of such Person will, as of such date, exceed the amount of all “liabilities of such Person, contingent or otherwise,” as of such date, as such quoted terms are determined in accordance with applicable federal and state laws governing determinations of the insolvency of debtors, (b) the present fair saleable value of the assets of such Person will, as of such date, be greater than the amount that will be required to pay the liability of such Person on its debts as such debts become absolute and matured, (c) such Person will not have, as of such date, an unreasonably small amount of capital with which to conduct its business, and (d) such Person will be able to pay its debts as they mature. For purposes of this definition, (i) “debt” means liability on a “claim,” and (ii) “claim” means any (x) right to payment, whether or not such a right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured or (y) right to an equitable remedy for breach of performance if such breach gives rise to a right to payment, whether or not such right to an equitable remedy is reduced to judgment, fixed, contingent, matured or unmatured, disputed, undisputed, secured or unsecured.

“ Subsidiary ” means as to any Person, a corporation, partnership, limited liability company or other entity of which shares of stock or other ownership interests having ordinary voting power (other than stock or such other ownership interests having such power only by reason of the happening of a contingency) to elect a majority of the board of directors or other managers of such corporation, partnership or other entity are at the time owned, or the management of which is otherwise controlled, directly or indirectly through one or more intermediaries, or both, by such Person, provided , that the term “Subsidiary” shall not include any Drilling Program Partnership or Drilling Program. Unless otherwise qualified, all references to a “Subsidiary” or to “Subsidiaries” in this Agreement shall refer to a Subsidiary or Subsidiaries of the Borrower.

“ Subsidiary Guarantor ” means each Restricted Subsidiary.

“ Supplemental Oil and Gas Mortgage ” means a mortgage or a deed of trust, made by the Borrower or any Restricted Subsidiary in favor of, or for the benefit of, the Administrative Agent, for the benefit of the Secured Parties, substantially in the form of Exhibit S (with such changes thereto as shall be advisable under the laws of the jurisdiction in which such mortgage, deed of trust or other document is to be recorded) or in such other form as may be reasonably acceptable to the Administrative Agent, which creates a Lien on any Oil and Gas Properties located in any county in which the Borrower or any Restricted Subsidiary owns Oil and Gas Properties that are already subject to a Mortgage.

“ Supplemental Pipeline Mortgage ” means a mortgage or a deed of trust, made by the Borrower or any Restricted Subsidiary in favor of, or for the benefit of, the Administrative Agent, for the benefit of the Secured Parties, substantially in the form of Exhibit T (with such changes thereto as shall be advisable under the laws of the jurisdiction in which such mortgage, deed of trust or other document is to be recorded) or in such other form as may be reasonably acceptable to the Administrative Agent, which creates a Lien on any Pipeline Properties located in any county in which the Borrower or any Restricted Subsidiary owns Pipeline Properties that are already subject to a Pipeline Mortgage.

“ Synthetic Debt ” means, with respect to any Person as of any date of determination thereof, all obligations and liabilities of such Person in respect of transactions entered into by such Person that are intended to function primarily as or are the functional equivalent of or takes the place of a borrowing of funds (including any repurchase obligations or liabilities and any minority interest transactions that function primarily as a borrowing) but are not otherwise included in the definition of “ Indebtedness ” or as a liability on the consolidated balance sheet of such Person and its Subsidiaries in accordance with GAAP, except for obligations arising under Hedge Agreements expressly permitted under this Agreement.

“ Synthetic Lease ” means, at any time, any lease (including leases that may be terminated by the lessee at any time) of any Property (a) that is accounted for as an operating lease under GAAP and (b) in respect of which the lessee retains or obtains ownership of the Property so leased for income tax purposes, other than any such lease under which such Person is the lessor.

“ Synthetic Lease Obligations ” means, with respect to any Synthetic Lease, at any time, an amount of equal to the higher of (a) the aggregate termination value or purchase price or similar payments in the nature of principal payable thereunder and (b) the then aggregate outstanding principal amount of the notes or other instruments issued by, and the amount of the equity investment, if any, in, the lessor under such Synthetic Lease.

“ Taxes ” means all present or future taxes (including ad valorem, production and severance taxes), levies, imposts, duties, deductions, withholdings, assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

“ Termination Date ” means September 8, 2011.

“ Total Borrowing Base Availability ” means, at any time, an amount equal to (a) the aggregate Borrowing Base Commitments then in effect, minus (b) the Aggregate Outstanding Credit.

“ Total Commitments ” means, at any time, the aggregate amount of the Commitments in effect at such time.

“ Transfer Letter ” means each letter in lieu of any transfer order in substantially the form of Exhibit J , executed by the Borrower and each Restricted Subsidiary executing a Mortgage, as applicable.

“ Type ” means, as to any Loan, its nature as an ABR Loan or a Eurodollar Loan.

“ UCC ” means the Uniform Commercial Code as in effect in the State of Ohio; provided that if perfection or the effect of perfection or non-perfection is governed by the Uniform Commercial Code as in effect in a jurisdiction other than the State of Ohio, “ UCC ” means the Uniform Commercial Code as in effect from time to time in such other jurisdiction for purposes of the provisions hereof relating to such perfection, effect of perfection or non-perfection or priority.

“ Uniform Customs ” means the Uniform Customs and Practice for Documentary Credits (1993 Revision), International Chamber of Commerce Publication No. 500, as the same may be amended from time to time.

“ United States ” and “ U.S. ” mean the United States of America.

“ Unrestricted Subsidiary ” means each of NGAS Securities, Inc., a Kentucky corporation; Sentra Corporation, a Kentucky corporation; and Daugherty Petroleum ND Ventures, LLC, a Kentucky limited liability company. Any designation by the Borrower of any other Subsidiary as an Unrestricted Subsidiary shall require the prior written approval of the Administrative Agent and the Lenders.

“ USA PATRIOT Act ” means United States Public Law 107-56, Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT) Act of 2001, as amended from time to time, and the rules and regulations promulgated thereunder from time to time in effect.

Section 1.02. Other Definitional Provisions .

(a) Unless otherwise specified therein, all terms defined in this Agreement shall have the defined meanings when used in the other Loan Documents or any certificate or other document made or delivered pursuant hereto or thereto.

(b) As used herein and in the other Loan Documents, and any certificate or other document made or delivered pursuant hereto or thereto, accounting terms relating to Holdings, the Borrower and its Subsidiaries not defined in Section 1.01 and accounting terms partly defined in Section 1.01, to the extent not defined, shall have the respective meanings given to them under GAAP.

(c) The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation.” The word “will” shall be construed to have the same meaning and effect as the word “shall.” Unless the context requires otherwise (i) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, amended and restated supplemented or otherwise modified (subject to any restrictions on such amendments, amendments and restatements, supplements or modifications set forth herein), (ii) any reference herein to any Person shall be construed to include such Person’s successors and assigns, (iii) the words “herein,” “hereof” and “hereunder,” and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (iv) the word “incur” shall be construed to mean incur, create, issue, assume, become liable in respect of or suffer to exist (and the words “incurred” and “incurrence” shall have correlative meanings), (v) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement, (vi) any reference to any law or regulation herein shall, unless otherwise specified, refer to such law or regulation as amended, modified or supplemented from time to time and (vii) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any interest of any kind of asset or property, whether real, personal, or mixed, or tangible or intangible, including cash, Equity Interests, securities, accounts and contract rights.

(d) No inference in favor of, or against, any party to this Agreement shall be drawn from the fact that such party has drafted any portion of this Agreement.

(e) All obligations of the Borrower or Holdings under this Agreement and the other Loan Documents shall be performed and satisfied by or on behalf of the Borrower or Holdings, as applicable, at its sole cost and expense.

ARTICLE II

AMOUNT AND TERMS OF COMMITMENTS

Section 2.01. Commitments .

(a) Subject to the terms and conditions hereof, each Lender severally agrees to make revolving credit loans (“ Loans ”) to the Borrower from time to time during the Commitment Period in an aggregate principal amount at any one time outstanding which, when added to such Lender’s Borrowing Base Commitment Percentage of the LC Obligations then outstanding, does not exceed the amount of such Lender’s Commitment or such Lender’s Borrowing Base Commitment; provided , however , that after giving effect to any borrowing of a Loan, the Aggregate Outstanding Credit shall not exceed an amount equal to the lesser of (i) the Borrowing Base, or (ii) the Total Commitments then in effect. During the Commitment Period, the Borrower may use the Commitments by borrowing, prepaying the Loans in whole or in part, and reborrowing, all in accordance with the terms and conditions hereof. The Loans may from time to time be Eurodollar Loans or ABR Loans, as determined by the Borrower and notified to the Administrative Agent in accordance with Sections 2.03 and 2.08.

(b) The Borrower unconditionally promises to repay all outstanding Loans on the Termination Date (or such earlier date on which the Loans become due and payable pursuant to Section 8.01).

(c) The Borrower and any one or more Lenders (including New Lenders) may agree that each such Lender shall increase of the amount of its existing Commitment (or shall obtain a new Commitment, as applicable), in each case by executing and delivering to the Administrative Agent an Increased Facility Activation Notice specifying (i) the amount of such increase and (ii) the Increased Facility Closing Date, which shall be at least forty-five (45) days after receipt by the Administrative Agent of such Increased Facility Activation Notice. Notwithstanding the foregoing, without the consent of the Required Lenders, (x) the aggregate amount of incremental Commitments obtained pursuant to this paragraph shall not exceed $50,000,000 and (y) no more than three (3) Increased Facility Closing Dates may be selected by the Borrower during the term of this Agreement. No Lender shall have any obligation to increase its Commitment described in this paragraph unless it agrees to do so in its sole discretion. For the avoidance of doubt, no Lender’s consent shall be required to give effect to any New Lender obtaining a Commitment or any existing Lender increasing its Commitment pursuant to this Section 2.01.

(d) Any additional bank, financial institution or other entity which, with the consent of the Borrower and the Administrative Agent (which consent shall not be unreasonably withheld), elects to become a “Lender” under this Agreement in connection with any transaction described in Section 2.01(c) shall execute a New Lender Supplement (each, a “ New Lender Supplement ”), substantially in the form of Exhibit P , whereupon such bank, financial institution or other entity (a “ New Lender ”) shall become a Lender for all purposes and to the same extent as if originally a party hereto and shall be bound by and entitled to the benefits of this Agreement.

(e) For the purpose of providing that the respective amounts of Loans (and Eurodollar Tranches in respect thereof) held by the Lenders are held by them on a pro rata basis according to their respective Borrowing Base Commitment Percentages, on each Increased Facility Closing Date and the date of each adjustment of the Borrowing Base Commitments and Borrowing Base Loan Commitment Percentages pursuant to Section 2.02(d)(vi), (i) all outstanding Loans shall be converted into a single Revolving Loan that is a Eurodollar Loan (with an Interest Period to be selected by the Borrower), and upon such conversion the Borrower shall pay any amounts owing pursuant to Section 2.17, if any, (ii) any new borrowings of Loans on such date shall also be part of such single Loan and (iii) all Lenders (including the New Lenders) shall hold a portion of such single Loan equal to its Borrowing Base Commitment Percentage thereof, and the Lenders and the Borrower shall make such adjustments in the principal amounts of the Loans held by the Lenders on such date as may be requested by the Administrative Agent so as to achieve the foregoing.

Section 2.02. Borrowing Base .

(a)  Borrowing Base . The Borrowing Base in effect as of the Closing Date is $75,000,000 (the “ Initial Borrowing Base ”). The Initial Borrowing Base shall remain in effect until the next Borrowing Base redetermination made pursuant to this Section 2.02. The Borrowing Base shall be determined in accordance with the standards set forth in Section 2.02(d) and is subject to periodic redetermination pursuant to Sections 2.02(b) and 2.02(c).

(b)  Calculation of Borrowing Base .

(i) The Borrower shall deliver to the Administrative Agent and each of the Lenders on or before April 1 of each calendar year, beginning April 1, 2008, (A) an Independent Engineering Report dated effective as of the immediately preceding January 1, (B) an Oil and Gas Property Certificate and a Farmout/Participation Property Certificate, each dated effective as of such April 1 date, (C) its requested amount for the redetermined Borrowing Base, and (D) such other information and data as may be reasonably requested by the Administrative Agent or any Lender with respect to the Oil and Gas Properties of the Borrower and its Restricted Subsidiaries, including all such Oil and Gas Properties included or to be included in the Borrowing Base. Within twenty (20) days after the Administrative Agent and the Lenders’ receipt of such Independent Engineering Report, Oil and Gas Property Certificate and Farmout/Participation Property Certificate and other information, the Administrative Agent shall deliver to each Lender the Administrative Agent’s recommendation for the redetermined Borrowing Base (which recommendation may, for the avoidance of doubt, be to leave the Borrowing Base unchanged or to decrease the Borrowing Base as further provided in this Section 2.02). Within ten (10) days after the Lenders’ receipt of the Administrative Agent’s recommendation, the Administrative Agent and the Lenders in the case of an increase in the Borrowing Base, and the Administrative Agent and the Required Lenders in the case of a decrease in the Borrowing Base or a reaffirmation of the then existing Borrowing Base, shall redetermine the Borrowing Base in accordance with Section 2.02(d), and the Administrative Agent shall promptly notify the Borrower in writing of the amount of the Borrowing Base as so redetermined.

(ii) The Borrower shall deliver to the Administrative Agent and each Lender on or before October 1 of each calendar year, beginning October 1, 2008, (A) an Internal Engineering Report dated effective as of the immediately preceding July 1, (B) an Oil and Gas Property Certificate and a Farmout/Participation Property Certificate, each dated effective as of such October 1 date, (C) its requested amount for the redetermined Borrowing Base, and (D) such other information and data as may be reasonably requested by the Administrative Agent or any Lender with respect to the Oil and Gas Properties of the Borrower and its Restricted Subsidiaries, including all such Oil and Gas Properties included or to be included in the Borrowing Base. Within twenty (20) days after the Administrative Agent and the Lenders’ receipt of such Internal Engineering Report, Oil and Gas Property Certificate and Farmout/Participation Property Certificate and other information, the Administrative Agent shall deliver to each Lender the Administrative Agent’s recommendation for the redetermined Borrowing Base (which recommendation may, for the avoidance of doubt, be to leave the Borrowing Base unchanged or to decrease the Borrowing Base as further provided in this Section 2.02). Within ten (10) days after the Lenders’ receipt of the Administrative Agent’s recommendation, the Administrative Agent and the Lenders in the case of an increase in the Borrowing Base, and the Administrative Agent and the Required Lenders in the case of a decrease in the Borrowing Base or a reaffirmation of the then existing Borrowing Base, shall redetermine the Borrowing Base in accordance with Section 2.02(d), and the Administrative Agent shall promptly notify the Borrower in writing of the amount of the Borrowing Base as so redetermined.

(iii) In the event that the Borrower does not furnish to the Administrative Agent and the Lenders the Independent Engineering Report, Internal Engineering Report, Oil and Gas Property Certificate, Farmout/Participation Property Certificate, or other information and data specified in clauses (i) and (ii) above by the date specified therein, the Administrative Agent and the Lenders may nonetheless redetermine the Borrowing Base and redesignate the Borrowing Base from time to time thereafter in their sole discretion until the Administrative Agent and the Lenders receive the relevant Independent Engineering Report, Internal Engineering Report, Farmout/Participation Property Certificate, or other information and data, as applicable, whereupon the Administrative Agent and the Lenders shall redetermine the Borrowing Base as otherwise specified in this Section 2.02(b) and Section 2.02(d).

(iv) Each delivery of an Engineering Report and related Oil and Gas Property Certificate by the Borrower to the Administrative Agent and the Lenders shall constitute a representation and warranty by the Borrower to the Administrative Agent and the Lenders that (A) the Borrower and its Restricted Subsidiaries, as applicable, own the Oil and Gas Properties described therein, (B) the Borrowing Base Properties described therein are subject to an Acceptable Lien, except to the extent otherwise expressly permitted in writing by the Lenders, and (C) on and as of the date of such Engineering Report, each of the Oil and Gas Properties owned by the Borrower or any of its Restricted Subsidiaries and described therein was developed for oil and gas, and the wells pertaining to such Oil and Gas Properties that are described therein as producing wells were each producing oil and gas in paying quantities, except for any such wells that were utilized as water or gas injection wells or as water disposal wells.

(v) Each delivery of a Farmout/Participation Property Certificate by the Borrower to the Administrative Agent and the Lenders shall constitute a representation and warranty by the Borrower to the Administrative Agent and the Lenders that (A) the Borrower and its Restricted Subsidiaries, as applicable, own the Farmout Properties and the Participation Properties described therein (subject in each case to the reserved interests and burdens expressly set forth in the applicable Farmout Agreement or the applicable Participation Agreement, as the case may be), (B) the Farmout Properties described therein that are (or that are proposed to be) Borrowing Base Properties are Approved Farmout Properties, except to the extent otherwise expressly permitted in writing by the Lenders, (C) the Participation Properties described therein that are (or that are proposed to be) Borrowing Base Properties are Approved Participation Properties, except to the extent permitted in writing by the Lenders and (D) on and as of the date of such Farmout/Participation Property Certificate, each of the Farmout Properties and the Participation Properties owned by the Borrower or any of its Restricted Subsidiaries and described therein relates to Proved Reserves.

(c)  Interim Redeterminations of Borrowing Base . In addition to the Borrowing Base redeterminations provided for in Section 2.02(b), the Borrower may request one (1) additional redetermination of the Borrowing Base during any six-month period between scheduled Borrowing Base redeterminations, and the Administrative Agent and the Required Lenders may, in their sole discretion and based on such information as the Administrative Agent and such Lenders deem relevant (but in accordance with Section 2.02(d)), make requests for additional redeterminations of the Borrowing Base at any time between scheduled Borrowing Base redeterminations. The party requesting the redetermination shall give the other parties to this Agreement at least ten (10) days’ prior written notice that a redetermination of the Borrowing Base pursuant to this paragraph (c) is to be performed. In connection with any redetermination of the Borrowing Base under this Section 2.02(c), the Borrower shall provide the Administrative Agent and the Lenders with such information regarding the Borrower and its Restricted Subsidiaries’ business (including, without limitation, any Oil and Gas Properties of the Borrower or any of its Restricted Subsidiaries, any Proved Reserves attributable thereto, and production relating thereto) as the Administrative Agent or any Lender may request, and further including any updated Engineering Report, any supplemental Oil and Gas Property Certificate and any supplemental Farmout/Participation Property Certificate. The Administrative Agent shall promptly notify the Borrower in writing of each redetermination of the Borrowing Base pursuant to this Section 2.02(c) and the amount of the Borrowing Base as so redetermined.

(d)  Standards for Redetermination of Borrowing Base .

(i) Each redetermination of the Borrowing Base by the Administrative Agent and the Lenders pursuant to this Section 2.02 shall be made (A) in the sole discretion of the Administrative Agent and the Lenders (but in accordance with the other provisions of this Section 2.02(d)), (B) in accordance with the Administrative Agent’s and the Lenders’ customary internal standards and practices for valuing and redetermining the value of Oil and Gas Properties in connection with reserve-based oil and gas loan transactions, (C) in conjunction with the most recent Independent Engineering Report or Internal Engineering Report, as applicable, the most recent Oil and Gas Property Certificate, Farmout/Participation Property Certificate, or other information received by the Administrative Agent and the Lenders relating to the Oil and Gas Properties of the Borrower and its Restricted Subsidiaries, (D) based upon the discounted present value of the estimated net cash flows to be realized from the production of Hydrocarbons from Proved Reserves attributable to Proved Properties, Farmout Properties and Participation Properties owned by the Borrower and its Restricted Subsidiaries, as determined by the Administrative Agent and the Lenders, (E) based upon the value of the estimated net revenues realized from the Open-Access Pipeline Properties, as reasonably determined by the Administrative Agent and the Lenders, and/or (F) such other factors as the Administrative Agent and the Lenders may consider in their sole discretion. In valuing and redetermining the Borrowing Base, the Administrative Agent and the Lenders may (but shall not under any circumstances be required to) also consider other assets, liabilities, cash flows, business, properties, prospects, and management of the Borrower and its Restricted Subsidiaries and such other factors as the Administrative Agent and the Lenders reasonably deem appropriate.

(ii) No Proved Properties, Farmout Properties, Participation Properties or Open-Access Pipeline Properties of the Borrower or any of its Restricted Subsidiaries shall be included or considered for inclusion in the Borrowing Base unless the Administrative Agent and the Lenders shall have received, at the Borrower’s sole cost and expense, Oil and Gas Property Title Information and Oil and Gas Property Description Information, in form and substance satisfactory to the Administrative Agent and the Lenders, and evidence satisfactory to the Administrative Agent that the Administrative Agent has an Acceptable Lien in such Oil and Gas Properties relating thereto for the benefit of the Secured Parties pursuant to the Security Documents.

(iii) At all times after the Administrative Agent has given the Borrower notification of a redetermination of the Borrowing Base under this Section 2.02, the Borrowing Base shall be equal to the redetermined amount or such lesser amount designated by the Borrower and disclosed in writing to the Administrative Agent and the Lenders until the Borrowing Base is subsequently redetermined in accordance with this Section 2.02. It is expressly understood and agreed that the Administrative Agent and Lenders have no obligation to designate the Borrowing Base at any particular amount, except in the exercise of their discretion, whether in relation to the Total Commitments or otherwise.

(iv) Any redetermination of the Borrowing Base shall be subject to the following restrictions: (A) the Borrowing Base shall not at any time exceed the Total Commitments then in effect, (B) to the extent any redetermined Borrowing Base would represent an increase in the Borrowing Base in effect prior to such redetermination, such Borrowing Base must be approved by all of the Lenders, and (C) to the extent any redetermined Borrowing Base would represent a decrease in the Borrowing Base in effect prior to such redetermination or a reaffirmation of such prior Borrowing Base, the Borrowing Base must be approved by the Administrative Agent and the Required Lenders. Any redetermination of the Borrowing Base which results in a Borrowing Base Increase shall result in a corresponding pro rata adjustment to each Lender’s Borrowing Base Commitment, which adjustment shall be subject to Section 2.02(d)(v) below.

(v) Without limiting clause (iv) above, in the case of any proposed redetermination of the Borrowing Base that would result in a Borrowing Base Increase, any Lender may elect to not increase its Borrowing Base Commitment to reflect such Borrowing Base Increase, provided that (A) such Lender (the “ Electing Lender ”) delivers written notice of such election to the Administrative Agent at least five (5) Business Days prior to the date such proposed redetermination is scheduled to take effect and (B) within five (5) Business Days of its receipt of such notice, the Administrative Agent receives executed Assignment and Assumptions and other written agreements from other Lenders, in form and substance satisfactory to the Administrative Agent, that they will commit to make additional Loans (and to participate in additional L/C Obligations) and commit to additional increases to their respective Borrowing Base Commitments in an aggregate amount equal to such Electing Lender’s pro rata share of the Borrowing Base Increase. Each such Lender’s, including the Electing Lender’s, Borrowing Base Commitment and Borrowing Base Commitment Percentage shall be adjusted to give effect to such election.

(e)  Conforming Borrowing Base . The Conforming Borrowing Base in effect as of the Closing Date is $65,000,000 (the “ Initial Conforming Borrowing Base ”). The Conforming Borrowing Base shall be utilized solely for purposes of determining the Conforming Borrowing Base Usage under and for purposes of this Agreement. The amount of the Conforming Borrowing Base may be redetermined on or about May 1, 2008, by the Administrative Agent and the Lenders in the same manner as the Borrowing Base may be redetermined on or about such date as provided in this Section 2.02. Notwithstanding the foregoing, beginning on June 30, 2008 and continuing through the Termination Date, the Borrowing Base shall be an amount which is equal to the Conforming Borrowing Base, as redetermined in accordance with Section 2.02, unless all of the Lenders agree in writing that the Conforming Borrowing Base should thereafter be maintained at an amount which is lower than the amount of the Borrowing Base then in effect.

Section 2.03. Procedure for Borrowing . The Borrower may borrow under the Commitments during the Commitment Period on any Business Day, provided that the Borrower shall give the Administrative Agent irrevocable notice in the form of a Notice of Borrowing (which notice must be received by the Administrative Agent prior to 12:00 Noon, Cleveland, Ohio time, (a) three (3) Business Days prior to the requested Borrowing Date, in the case of Eurodollar Loans, or (b) one (1) Business Day prior to the requested Borrowing Date, in the case of ABR Loans), specifying (i) the amount and Type of Loans to be borrowed, (ii) the requested Borrowing Date and (iii) in the case of Eurodollar Loans, the respective amounts of each such Type of Loan and the respective lengths of the initial Interest Period therefor. Any Loans made on the Closing Date shall initially be ABR Loans. Each borrowing under the Commitments shall be in an amount equal to (x) in the case of ABR Loans, $1,000,000 or a whole multiple thereof (or, if the then aggregate Available Commitments are less than $1,000,000, such lesser amount) and (y) in the case of Eurodollar Loans, $5,000,000 or a whole multiple of $1,000,000 in excess thereof. Upon receipt of any Notice of Borrowing from the Borrower, the Administrative Agent shall promptly notify each Lender thereof. Each Lender will make the amount of its Borrowing Base Commitment Percentage of each borrowing available to the Administrative Agent for the account of the Borrower at the Funding Office prior to 12:00 noon, Cleveland, Ohio time, on the Borrowing Date requested by the Borrower in funds immediately available to the Administrative Agent. Such borrowing will then be made available to the Borrower by the Administrative Agent crediting the account of the Borrower on the books of such office with the aggregate of the amounts made available to the Administrative Agent by the Lenders and in like funds as received by the Administrative Agent.

Section 2.04. Unused Commitment Fees, Etc.

(a) The Borrower agrees to pay to the Administrative Agent for the account of each Lender, in accordance with its Borrowing Base Availability Percentage, an unused commitment fee for the period from and including the Closing Date to the last day of the Commitment Period, computed at the Unused Commitment Fee Rate times the average daily amount of the Borrowing Base Availability during the period for which payment is made, payable quarterly in arrears on the last day of each March, June, September and December and on the Termination Date, commencing on the first of such dates to occur after the date hereof.

(b) The Borrower shall pay to the Arranger and the Administrative Agent for their own respective accounts fees in the amounts and at the times specified in the Fee Letter.

Section 2.05. Termination or Reduction of Commitments . The Borrower shall have the right, upon not less than three Business Days’ notice to the Administrative Agent, to terminate the Commitments or, from time to time, to reduce the amount of the Commitments; provided that no such termination or reduction of Commitments shall be permitted if, after giving effect thereto and to any prepayments of the Loans made on the effective date thereof, the Aggregate Outstanding Credit would exceed the Total Commitments then outstanding. Any such reduction shall be in an amount equal to $1,000,000, or a whole multiple thereof, and shall reduce permanently the Commitments then in effect. All fees in respect of this Agreement and the Loans accrued until the effective date of any termination of this Agreement shall be paid on the effective date of such termination.

Section 2.06. Optional Prepayments . The Borrower may at any time and from time to time prepay the Loans, in whole or in part, without premium or penalty, upon irrevocable notice delivered to the Administrative Agent at least three (3) Business Days prior thereto in the case of Eurodollar Loans and at least one Business Day prior thereto in the case of ABR Loans, which notice shall specify the date and amount of prepayment and whether the prepayment is of Eurodollar Loans or ABR Loans or a combination thereof; provided , that if a Eurodollar Loan is prepaid on any day other than the last day of the Interest Period applicable thereto, the Borrower shall also pay any amounts owing pursuant to Section 2.17. Upon receipt of any such notice the Administrative Agent shall promptly notify each relevant Lender thereof. If any such notice is given, the amount specified in such notice shall be due and payable on the date specified therein, together with (except in the case of Loans that are ABR Loans) accrued interest to such date on the amount prepaid. Partial prepayments of Loans shall be in an aggregate principal amount of $1,000,000 or a whole multiple thereof.

Section 2.07. Borrowing Base Deficiency; Mandatory Prepayments .

(a) If for any reason the Aggregate Outstanding Credit ever exceeds the Borrowing Base, the Borrower shall, after receipt of written notice from the Administrative Agent regarding such deficiency (a “ Deficiency Notice ”), deliver to the Administrative Agent within five (5) days of its receipt of such Deficiency Notice, a written response (a “ Response ”) indicating which of the following actions it will take to remedy the Borrowing Base deficiency (and the failure of the Borrower to deliver such Response or to perform the action selected by the Borrower in such Response to remedy such Borrowing Base deficiency shall constitute an Event of Default):

(i) prepay the Loans or, if the Loans have been repaid in full, Cash Collateralize the LC Obligations, such that the Borrowing Base deficiency is cured within ten (10) days after the date such Deficiency Notice is received by the Borrower; or

(ii) grant an Acceptable Lien in additional Oil and Gas Properties of the Borrower and the Restricted Subsidiaries acceptable to the Administrative Agent and each of Lenders such that the Borrowing Base deficiency is cured within fifteen (15) days after the date such Deficiency Notice is received by the Borrower from the Administrative Agent.

(b) If for any reason the Aggregate Outstanding Credit at any time exceeds the amount of the Total Commitments then in effect, the Borrower shall immediately prepay the Loans and LC Reimbursement Obligations in an aggregate amount equal to such excess.

(c) Each prepayment of the Loans pursuant to this Section 2.07 shall be accompanied by accrued and unpaid interest to the date of prepayment on the amount prepaid.

Section 2.08. Conversion and Continuation Options .

(a) The Borrower may elect from time to time to convert Eurodollar Loans to ABR Loans by giving the Administrative Agent at least two (2) Business Days’ prior irrevocable notice of such election, provided that any such conversion of Eurodollar Loans may only be made on the last day of an Interest Period with respect thereto. The Borrower may elect from time to time to convert ABR Loans to Eurodollar Loans by giving the Administrative Agent at least three (3) Business Days’ prior irrevocable notice of such election (which notice shall specify the length of the initial Interest Period therefor), provided that no ABR Loan may be converted into a Eurodollar Loan when any Default or Event of Default has occurred and is continuing and the Administrative Agent or the Required Lenders have determined in its or their sole discretion not to permit such conversions. Upon receipt of any such notice the Administrative Agent shall promptly notify each relevant Lender thereof.

(b) Any Eurodollar Loan may be continued as such upon the expiration of the then current Interest Period with respect thereto by the Borrower giving irrevocable notice to the Administrative Agent, in accordance with the applicable provisions of the term “Interest Period” set forth in Section 1.01, of the length of the next Interest Period to be applicable to such Loans, provided that no Eurodollar Loan may be continued as such when any Default or Event of Default has occurred and is continuing, and the Administrative Agent or the Required Lenders have determined in its or their sole discretion not to permit such continuations, and provided , further , that if the Borrower shall fail to give any required notice as described above in this paragraph or if such continuation is not permitted pursuant to the preceding proviso such Loans shall be automatically converted to ABR Loans on the last day of such then expiring Interest Period. Upon receipt of any such notice the Administrative Agent shall promptly notify each relevant Lender thereof.

(c) Each notice by the Borrower pursuant to this Section 2.08 shall be given pursuant to a Notice of Conversion/Continuation.

Section 2.09. Limitations on Eurodollar Tranches . Notwithstanding anything to the contrary in this Agreement, all borrowings, conversions and continuations of Eurodollar Loans hereunder and all selections of Interest Periods hereunder shall be in such amounts and be made pursuant to such elections so that, (a) after giving effect thereto, the aggregate principal amount of the Eurodollar Loans comprising each Eurodollar Tranche shall be equal to $5,000,000 or a whole multiple of $1,000,000 in excess thereof and (b) no more than ten (10) Eurodollar Tranches shall be outstanding at any one time.

Section 2.10. Interest Rates and Payment Dates .

(a) Each Eurodollar Loan shall bear interest for each day during each Interest Period with respect thereto at a rate per annum equal to the Eurodollar Rate determined for such day plus the Applicable Margin.

(b) Each ABR Loan shall bear interest at a rate per annum equal to the ABR plus the Applicable Margin.

(c)     (i) If any amount of principal of any Loan or LC Reimbursement Obligation is not paid when due (without regard to any applicable grace periods), whether at stated maturity, by acceleration or otherwise, such amount shall thereafter bear interest at a fluctuating interest rate per annum at all times equal to the Default Rate to the fullest extent permitted by applicable Requirements of Law.

(ii) If any amount (other than principal of any Loan or LC Reimbursement Obligation) payable by the Borrower under any Loan Document is not paid when due (without regard to any applicable grace periods), whether at stated maturity, by acceleration or otherwise, then upon the request of the Required Lenders such amount shall thereafter bear interest at a fluctuating interest rate per annum at all times equal to the Default Rate to the fullest extent permitted by applicable Requirements of Law.

(iii) Upon the request of the Required Lenders, while any Event of Default exists, the Borrower shall pay interest on the principal amount of all outstanding Obligations hereunder at a fluctuating interest rate per annum at all times equal to the Default Rate to the fullest extent permitted by applicable Requirements of Law.

(iv) Accrued and unpaid interest on past due amounts (including interest on past due interest) shall be due and payable upon demand.

(d) Interest on each Loan shall be due and payable in arrears on each Interest Payment Date applicable thereto and at such other times as may be specified herein. Interest hereunder shall be due and payable in accordance with the terms hereof before and after judgment, and before and after the commencement of any proceeding under any bankruptcy, insolvency, reorganization or similar law.

Section 2.11. Computation of Interest and Fees .

(a) Interest and fees payable pursuant hereto shall be calculated on the basis of a 360-day year for the actual days elapsed, except that, with respect to ABR Loans the rate of interest on which is calculated on the basis of the Prime Rate, the interest thereon shall be calculated on the basis of a 365- (or 366-, as the case may be) day year for the actual days elapsed. The Administrative Agent shall as soon as practicable notify the Borrower and the Lenders of each determination of a Eurodollar Rate. Any change in the interest rate on a Loan resulting from a change in the ABR or the Eurocurrency Reserve Requirements shall become effective as of the opening of business on the day on which such change becomes effective. The Administrative Agent shall as soon as practicable notify the Borrower and the Lenders of the effective date and the amount of each such change in interest rate.

(b) Each determination of an interest rate by the Administrative Agent pursuant to any provision of this Agreement shall be conclusive and binding on the Borrower and the Lenders in the absence of manifest error.

Section 2.12. Inability to Determine Interest Rate . If prior to the first day of any Interest Period:

(a) the Administrative Agent shall have determined (which determination shall be conclusive and binding upon the Borrower) that, by reason of circumstances affecting the relevant market, adequate and reasonable means do not exist for ascertaining the Eurodollar Rate for such Interest Period, or

(b) the Administrative Agent shall have received notice from the Required Lenders that the Eurodollar Rate determined or to be determined for such Interest Period will not adequately and fairly reflect the cost to such Lenders (as conclusively certified by such Lenders) of making or maintaining their affected Loans during such Interest Period, the Administrative Agent shall give facsimile or telephonic notice thereof to the Borrower and the relevant Lenders as soon as practicable thereafter. If such notice is given (i) any Eurodollar Loans requested to be made on the first day of such Interest Period shall be made as ABR Loans, (ii) any Loans that were to have been converted on the first day of such Interest Period to Eurodollar Loans shall be continued as ABR Loans and (iii) any outstanding Eurodollar Loans shall be converted, on the last day of the then-current Interest Period, to ABR Loans. Until such notice has been withdrawn by the Administrative Agent, no further Eurodollar Loans shall be made or continued as such, nor shall the Borrower have the right to convert Loans to Eurodollar Loans.

Section 2.13. Pro Rata Treatment and Payments .

(a) Each borrowing by the Borrower from the Lenders hereunder shall be made pro rata according to the Borrowing Base Commitment Percentages of the Lenders. Each increase or decrease of the Borrowing Base shall result in a pro rata increase or reduction of each Lender’s Borrowing Base Commitment, except to the extent provided in Section 2.02(d)(v). Each reduction of the Commitments of the Lenders shall be made pro rata according to the Applicable Percentages of the Lenders.

(b) Each payment (including each prepayment) by the Borrower on account of principal of and interest on the Loans shall be made pro rata according to the outstanding principal amounts of the Loans then held by the Lenders.

(c) All payments (including prepayments) to be made by the Borrower hereunder, whether on account of principal, interest, fees or otherwise, shall be made without any condition or deduction for any counterclaim, defense, recoupment or setoff and shall be made prior to 12:00 Noon, Cleveland, Ohio time, on the due date thereof to the Administrative Agent, for the account of the Lenders, at the Funding Office, in Dollars and in immediately available funds. The Administrative Agent shall distribute such payments to the Lenders promptly upon receipt in like funds as received. If any payment hereunder (other than payments on the Eurodollar Loans) becomes due and payable on a day other than a Business Day, such payment shall be extended to the next succeeding Business Day. If any payment on a Eurodollar Loan becomes due and payable on a day other than a Business Day, the maturity thereof shall be extended to the next succeeding Business Day unless the result of such extension would be to extend such payment into another calendar month, in which event such payment shall be made on the immediately preceding Business Day. In the case of any extension of any payment of principal pursuant to the preceding two sentences, interest thereon shall be payable at the then applicable rate during such extension.

(d) Unless the Administrative Agent shall have received notice from a Lender prior to the proposed date of any borrowing that such Lender will not make available to the Administrative Agent such Lender’s share of such borrowing, the Administrative Agent may assume that such Lender has made such share available on such date in accordance with Section 2.03, and may, in reliance upon such assumption, make available to the Borrower a corresponding amount. In such event, if a Lender has not in fact made such amount available to the Administrative Agent, then the applicable Lender and the Borrower severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount with interest thereon, for each day from and including the date such amount is made available to the Borrower to but excluding the date of payment to the Administrative Agent, at (i) in the case of a payment to be made by such Lender, the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation and (ii) in the case of a payment to be made by the Borrower, the interest rate applicable to ABR Loans. If the Borrower and such Lender shall pay such interest to the Administrative Agent for the same or an overlapping period, the Administrative Agent shall promptly remit to the Borrower the amount of such interest paid by the Borrower for such period. If such Lender pays its share of the applicable borrowing to the Administrative Agent, then the amount so paid shall constitute such Lender’s Loan included in such borrowing. Any payment by the Borrower shall be without prejudice to any claim the Borrower may have against a Lender that shall have failed to make such payment to the Administrative Agent.

(e) Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Administrative Agent for the account of the Lenders or the Issuing Bank hereunder that the Borrower will not make such payment, the Administrative Agent may assume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders or the Issuing Bank, as the case may be, the amount due. In such event, if the Borrower has not in fact made such payment, then each of the Lenders or the Issuing Bank, as the case may be, severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender or the Issuing Bank, with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation. Nothing herein shall be deemed to limit the rights of the Administrative Agent, the Issuing Bank or any Lender against the Borrower.

(f) Whenever any payment received by the Administrative Agent under this Agreement or any of the other Loan Documents is insufficient to pay in full all amounts due and payable to the Administrative Agent, the Lenders, and the Issuing Bank under or in respect of this Agreement and the other Loan Documents on any date, the Administrative Agent may, but shall not be obligated to, distribute such payment in the order of priority set forth in Section 8.03. If the Administrative Agent receives funds for application to the Obligations of the Loan Parties under or in respect of the Loan Documents under circumstances for which the Loan Documents do not specify the manner in which such funds are to be applied, the Administrative Agent may, but shall not be obligated to, distribute such funds in the order of priority set forth in Section 8.03.

(g) The Borrower hereby authorizes each Lender and each of its Affiliates, if and to the extent any payment owed to such Lender is not made when due hereunder or any other Loan Document, to charge from time to time, to the fullest extent permitted by applicable law, against any or all of the Borrower’s accounts with such Lender or such Affiliate any amount so due.

(h) The obligations of the Lenders hereunder to make Loans to fund participations in Letters of Credit and to make payments pursuant to Section 10.05(c) are several and not joint. The failure of any Lender to make any Loan, to fund any such participation or to make any payment under Section 10.05(c) on any date required hereunder, shall not relieve any other Lender of its corresponding obligation to do so on such date, and no Lender shall be responsible for the failure of any other Lender to make its Loan, to purchase its participation or to make its payment under Section 10.05(c).

(i) Nothing herein shall be deemed to obligate any Lender to obtain the funds for any Loan in any particular place or manner or to constitute a representation by any Lender that it has obtained or will obtain funds for any Loan in any particular place or manner.

Section 2.14. Illegality . Notwithstanding any other provision herein, if the adoption of or any change in any Requirement of Law or in the interpretation or application thereof shall make it unlawful for any Lender to make or maintain Eurodollar Loans as contemplated by this Agreement, (a) the commitment of such Lender hereunder to make Eurodollar Loans, continue Eurodollar Loans as such and convert ABR Loans to Eurodollar Loans shall forthwith be cancelled and (b) such Lender’s Loans then outstanding as Eurodollar Loans, if any, shall be converted automatically to ABR Loans on the respective last days of the then current Interest Periods with respect to such Loans or within such earlier period as required by law. If any such conversion of a Eurodollar Loan occurs on a day which is not the last day of the then current Interest Period with respect thereto, the Borrower shall pay to such Lender such amounts, if any, as may be required pursuant to Section 2.17.

Section 2.15. Increased Costs .

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

(i) impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended or participated in by, any Lender (except any reserve requirement reflected in the Eurodollar Rate) or the Issuing Bank;

(ii) subject any Lender or the Issuing Bank to any tax of any kind whatsoever with respect to this Agreement, any Letter of Credit, any participation in a Letter of Credit or any Eurodollar Loan made by it, or change the basis of taxation of payments to such Lender or the Issuing Bank in respect thereof (except for Indemnified Taxes or Other Taxes covered by Section 2.16 and the imposition of, or any change in the rate of, any Excluded Tax payable by such Lender or the Issuing Bank); or

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

and the result of any of the foregoing shall be to increase the cost to such Lender of making or maintaining any Eurodollar Loan (or of maintaining its obligation to make any Eurodollar Loan), or to increase the cost to such Lender or the Issuing Bank of participating in, issuing or maintaining any Letter of Credit (or of maintaining its obligation to participate in or to issue any Letter of Credit), or to reduce the amount of any sum received or receiv