Exhibit 10.52

 

Execution Version

 

$400,000,000 REVOLVING CREDIT FACILITY

$200,000,000 TRANCHE B CREDIT-LINKED DEPOSITS

LETTER OF CREDIT FACILITY

 

CREDIT AGREEMENT

 

by and among

 

CONSOL ENERGY INC.

 

and

 

THE LENDERS PARTY HERETO

 

and

 

CITICORP NORTH AMERICA, INC. and

PNC BANK, NATIONAL ASSOCIATION,

as the Co-Administrative Agents

 

and

 

LASALLE BANK NATIONAL ASSOCIATION,

SOCIÉTÉ GÉNÉRALE, NEW YORK BRANCH and

SUNTRUST BANK,

as the Co-Documentation Agents

 

and

 

CITIGROUP GLOBAL MARKETS INC. and

PNC CAPITAL MARKETS, INC.,

as Joint Lead Arrangers

 

Dated as of June 30, 2004

 

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1.         CERTAIN DEFINITIONS    1     1.1   Certain Definitions    1     1.2  
Construction    32         1.2.1    Number; Inclusion    32         1.2.2   
Determination    32         1.2.3    Paying Agent’s Discretion and Consent    32
        1.2.4    Documents Taken as a Whole    32         1.2.5    Headings   
32         1.2.6    Implied References to this Agreement    33         1.2.7   
Persons    33         1.2.8    Modifications to Documents    33         1.2.9   
From, To and Through    33         1.2.10    Shall; Will    33     1.3  
Accounting Principles    33 2.   REVOLVING CREDIT AND SWING LOAN FACILITIES   
34     2.1   Revolving Credit Commitments    34         2.1.1    Revolving
Credit Loans    34         2.1.2    Swing Loan Commitment    34     2.2   Nature
of Revolving Lenders’ Obligations with Respect to Revolving Credit Loans    34  
  2.3   Commitment Fees    35     2.4   Voluntary Reduction of Revolving Credit
Commitments    35     2.5   Revolving Credit Loan Requests; Swing Loan Requests
   35         2.5.1    Revolving Credit Loan Requests    35         2.5.2   
Swing Loan Requests    36     2.6   Making Revolving Credit Loans and Swing
Loans    36         2.6.1    Making Revolving Credit Loans    36         2.6.2
   Making Swing Loans    37     2.7   Revolving Credit Notes and Swing Loan Note
   37         2.7.1    Revolving Credit Note    37         2.7.2    Swing Loan
Note    37     2.8   Use of Proceeds    37     2.9   Letter of Credit
Subfacility    38         2.9.1    Issuance of Letters of Credit    38        
2.9.2    Letter of Credit Fees    39         2.9.3    Participations,
Disbursements, Reimbursement    40         2.9.4    Repayment of Revolving
Participation Advances    43         2.9.5    Documentation    44         2.9.6
   Determinations to Honor Drawing Requests    44         2.9.7    Nature of
Participation and Reimbursement Obligations    44         2.9.8    Indemnity   
46         2.9.9    Liability for Acts and Omissions    46

 

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3.         TRANCHE B CREDIT-LINKED DEPOSITS    48     3.1   Tranche B
Credit-Linked Deposit Account    48     3.2   Return of Tranche B Credit-Linked
Deposits    49     3.3   Evidence of Tranche B Credit-Linked Deposits    50    
3.4   Interests in Tranche B Credit-Linked Deposits    50 4.         INTEREST
RATES    50     4.1   Interest Rate Options    50         4.1.1    Revolving
Credit Interest Rate Options    51         4.1.2    [Intentionally Omitted]   
51         4.1.3    Interest Rate for Swing Loans    51         4.1.4    Rate
Quotations    51     4.2   Interest Periods    51         4.2.1    Amount of
Borrowing Tranche    51         4.2.2    Renewals    52     4.3   Interest After
Default    52         4.3.1    Letter of Credit Fees, Interest Rate    52      
  4.3.2    Other Obligations    52         4.3.3    Acknowledgment    52        
4.3.4    Euro-Rate Option Not Available Under Certain Circumstances    52    
4.4   Euro-Rate Unascertainable; Illegality; Increased Costs; Deposits Not
Available    52         4.4.1    Unascertainable    52         4.4.2   
Illegality; Increased Costs; Deposits Not Available    53         4.4.3   
Paying Agent’s and Lender’s Rights    53     4.5   Selection of Interest Rate
Options    54 5.         PAYMENTS    54     5.1   Payments    54     5.2   Pro
Rata Treatment of Lenders    54     5.3   Interest Payment Dates    55     5.4  
Voluntary Prepayments    55         5.4.1    Right to Prepay    55         5.4.2
   Replacement of a Lender    56         5.4.3    Mitigation Obligation    57  
  5.5   [Intentionally Deleted]    57     5.6   Additional Compensation in
Certain Circumstances    57         5.6.1    Increased Costs or Reduced Return
Resulting from Taxes, Reserves, Capital Adequacy Requirements, Expenses, Etc.   
57         5.6.2    Indemnity    58     5.7   Swing Loan Settlement Date
Procedures    59 6.         REPRESENTATIONS AND WARRANTIES    60     6.1  
Representations and Warranties    60

 

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        6.1.1    Organization and Qualification    60         6.1.2   
[Intentionally Omitted.]    60         6.1.3    Subsidiaries    60         6.1.4
   Power and Authority    60         6.1.5    Validity and Binding Effect    61
        6.1.6    No Conflict    61         6.1.7    Litigation    61        
6.1.8    Title to Properties    61         6.1.9    Financial Statements    62  
      6.1.10    Use of Proceeds; Margin Stock; Section 20 Subsidiaries    63    
    6.1.11    Full Disclosure    63         6.1.12    Taxes    63         6.1.13
   Consents and Approvals    64         6.1.14    No Event of Default;
Compliance with Instruments    64         6.1.15    Patents, Trademarks,
Copyrights, Licenses, Etc.    64         6.1.16    Security Interests    64    
    6.1.17    Mortgage Liens    65         6.1.18    Status of the Pledged
Collateral    65         6.1.19    Insurance    65         6.1.20    Compliance
with Laws    66         6.1.21    Material Contracts; Burdensome Restrictions   
66         6.1.22    Investment Companies; Regulated Entities    66        
6.1.23    Plans and Benefit Arrangements    66         6.1.24    Employment
Matters; Coal Act; Black Lung Act    67         6.1.25    Environmental Matters
   68         6.1.26    Senior Debt Status    70         6.1.27   
Anti-Terrorism Laws    70         6.1.28    Solvency    71         6.1.29   
Permit Blockage    71     6.2   Updates to Schedules    71 7.         CONDITIONS
OF LENDING AND ISSUANCE OF LETTERS OF CREDIT    71     7.1   First Loans,
Funding of Tranche B Credit-Linked Deposits and Letters of Credit    72        
7.1.1    Officer’s Certificate    72         7.1.2    Secretary’s Certificate   
72         7.1.3    Delivery of Loan Documents    73         7.1.4    Opinion of
Counsel    73         7.1.5    Legal Details    74         7.1.6    Payment of
Fees    74         7.1.7    Independent Business and Mining Plan Review;
Valuation of Major Assets; Environmental Assessment and Certificate    74      
  7.1.8    Officer’s Certificate Regarding MACs    75         7.1.9    No
Violation of Laws    75         7.1.10    No Actions or Proceedings    75

 

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        7.1.11    Insurance Policies; Certificates of Insurance; Endorsements   
75         7.1.12    Filing Receipts    75         7.1.13    Administrative
Questionnaire    75         7.1.14    UCC, Lien and Judgment Searches    76    
    7.1.15    Solvency    76         7.1.16    Financial Statements and
Financial Projections    76         7.1.17    ERISA; Other Due Diligence    76  
      7.1.18    Termination of Existing Credit Agreement and Designated Letter
of Credit Facility    77         7.1.19    Collateral Trust Agreement    77    
7.2   Each Additional Loan or Letter of Credit    77 8.         COVENANTS    78
    8.1   Affirmative Covenants    78         8.1.1    Preservation of
Existence, Etc.    78         8.1.2    Payment of Liabilities, Including Taxes,
Etc.    78         8.1.3    Maintenance of Insurance    78         8.1.4   
Maintenance of Properties and Leases    79         8.1.5    Maintenance of
Patents, Trademarks, Etc.    79         8.1.6    Visitation Rights; Field
Examinations    80         8.1.7    Keeping of Records and Books of Account   
80         8.1.8    Plans and Benefit Arrangements    80         8.1.9   
Compliance with Laws    81         8.1.10    Use of Proceeds    81        
8.1.11    Further Assurances    81         8.1.12    Subordination of
Intercompany Loans    81         8.1.13    Tax Shelter Regulations    81        
8.1.14    Anti-Terrorism Laws    82         8.1.15    Maintenance of Coal Supply
Agreements and Material Contracts    82         8.1.16    Collateral    82      
  8.1.17    Debt Rating    82     8.2   Negative Covenants    83         8.2.1
   Indebtedness    83         8.2.2    Liens    84         8.2.3    Guaranties
   84         8.2.4    Loans and Investments    85         8.2.5    Dividends
and Related Distributions    85         8.2.6    Liquidations, Mergers,
Consolidations, Acquisitions    86         8.2.7    Dispositions of Assets or
Subsidiaries    88         8.2.8    Affiliate Transactions    89         8.2.9
   Subsidiaries, Partnerships and Joint Ventures    89         8.2.10   
Continuation of or Change in Business    90         8.2.11    Plans and Benefit
Arrangements    90         8.2.12    Fiscal Year    91         8.2.13   
Issuance of Stock    91

 

iv

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        8.2.14    Changes in Organizational Documents; Amendments to Receivables
Purchase Agreement    91         8.2.15    Capital Expenditures and Capitalized
Leases    92         8.2.16    Certain Matters Regarding Senior Notes (1991),
Senior Notes (2002) and Certain Other Indebtedness    92         8.2.17   
Maximum Leverage Ratio    92         8.2.18    Minimum Interest Coverage Ratio
   92         8.2.19    Inconsistent Agreements    93         8.2.20   
Restrictions on Upstream Dividends and Payments    93         8.2.21    Certain
Matters Regarding the Collateral Trust Agreement    93     8.3   Reporting
Requirements    93         8.3.1    Quarterly Financial Statements    93        
8.3.2    Annual Financial Statements    93         8.3.3    SEC Web Site    94  
      8.3.4    Certificate of the Borrower    94         8.3.5    Notice of
Default    94         8.3.6    Notice of Litigation    94         8.3.7   
Certain Events    95         8.3.8    Budgets, Forecasts, Other Reports and
Information    95         8.3.9    Tax Shelter Provisions    96         8.3.10
   Notices Regarding Plans and Benefit Arrangements    96         8.3.11   
Notice of Change in Debt Rating    97 9.         DEFAULT    98     9.1   Events
of Default    98         9.1.1    Payments Under Loan Documents    98        
9.1.2    Breach of Warranty    98         9.1.3    Breach of Negative Covenants
or Visitation Rights    98         9.1.4    Breach of Other Covenants    98    
    9.1.5    Defaults in Other Agreements or Indebtedness    98         9.1.6   
Loss of Bonding Capability    99         9.1.7    Final Judgments or Orders   
99         9.1.8    Loan Document Unenforceable; Collateral Trust Agreement
Unenforceable    99         9.1.9    Uninsured Losses; Proceedings Against
Assets    99         9.1.10    Notice of Lien or Assessment    100        
9.1.11    Insolvency    100         9.1.12    Events Relating to Plans and
Benefit Arrangements    100         9.1.13    Cessation of Business    100      
  9.1.14    Change of Control    101         9.1.15    Involuntary Proceedings
   101         9.1.16    Voluntary Proceedings    101     9.2   Consequences of
Event of Default    101         9.2.1    Events of Default Other Than
Bankruptcy, Insolvency or Reorganization Proceedings    101

 

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        9.2.2    Bankruptcy, Insolvency or Reorganization Proceedings    102    
    9.2.3    Set-off    102         9.2.4    Suits, Actions, Proceedings    103
        9.2.5    Application of Proceeds; Collateral Trust Agreement    103    
    9.2.6    Other Rights and Remedies    104     9.3   Notice of Sale    104
10.       THE PAYING AGENT; THE CO-ADMINISTRATIVE AGENTS    104     10.1  
Appointment    104     10.2   Delegation of Duties    105     10.3   Nature of
Duties; Independent Credit Investigation    105     10.4   Actions in Discretion
of Agents; Instructions From the Lenders    106     10.5   Reimbursement and
Indemnification of Agents by the Borrower    106     10.6   Exculpatory
Provisions; Limitation of Liability    107     10.7   Reimbursement and
Indemnification of Agents by Lenders    108     10.8   Reliance by Agents    108
    10.9   Notice of Default    108     10.10   Notices    109     10.11  
Lenders in Their Individual Capacities    109     10.12   Holders of Notes   
109     10.13   Equalization of Lenders; Sharing of Payments    110        
10.13.1    Equalization of Lenders    110         10.13.2    Sharing of Payments
   110     10.14   Successor Agents    112     10.15   Agent’s Fee    113    
10.16   Availability of Funds    113     10.17   Calculations    114     10.18  
No Reliance on Agents’ Customer Identification Program    114     10.19  
Beneficiaries    114     10.20   Certain Releases of Guarantors and Collateral
   114     10.21   Certain Matters Regarding the Collateral Trust Agreement   
115 11.       MISCELLANEOUS    115     11.1   Modifications, Amendments or
Waivers    115         11.1.1    Increase of Commitment; Extension of Revolving
Expiration Date; Modification of Terms of Payment    115         11.1.2   
Tranche B Credit-Linked Deposits; Extension of Tranche B Maturity Date;
Modification of Terms of Payment    116         11.1.3    Release of Collateral
   116         11.1.4    Release of Guarantor    116         11.1.5    Relative
Rights Among Lenders    116         11.1.6    Miscellaneous    116     11.2   No
Implied Waivers; Cumulative Remedies; Writing Required    117     11.3  
Reimbursement and Indemnification of Lenders by the Borrower; Taxes    117    
11.4   Holidays    118

 

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    11.5   Funding by Branch, Subsidiary or Affiliate    118         11.5.1   
Notional Funding    118         11.5.2    Actual Funding.    119     11.6  
Notices    119     11.7   Severability    120     11.8   Governing Law    120  
  11.9   Prior Understanding    120     11.10   Duration; Survival    120    
11.11   Successors and Assigns    121     11.12   Confidentiality    124        
11.12.1    General    124         11.12.2    Sharing Information With Affiliates
of the Lenders.    125     11.13   Counterparts    125     11.14  
[Intentionally Omitted.]    125 0   11.15   Exceptions    125     11.16  
CONSENT TO FORUM; WAIVER OF JURY TRIAL    126     11.17   Certifications From
Lenders and Participants    126         11.17.1    Tax Withholding.    126      
  11.17.2    USA Patriot Act.    127     11.18   Joinder of Guarantors    128  
  11.19   Register    128

 

vii

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LIST OF SCHEDULES AND EXHIBITS

 

SCHEDULES         

SCHEDULE 1.1(A)

  -    PRICING GRID

SCHEDULE 1.1(B)

  -    COMMITMENTS OF LENDERS; TRANCHE B CREDIT-LINKED DEPOSITS AND ADDRESSES
FOR NOTICES

SCHEDULE 1.1(P)

  -    PERMITTED LIENS

SCHEDULE 1.1(R)

       REAL PROPERTY

SCHEDULE 2.9.1

  -    EXISTING LETTERS OF CREDIT

SCHEDULE 3.1(b)

  -    CERTIFICATE OF DEPOSIT TERMS AND CONDITIONS

SCHEDULE 6.1.1

  -    QUALIFICATIONS TO DO BUSINESS

SCHEDULE 6.1.3

  -    SUBSIDIARIES

SCHEDULE 6.1.15

  -    PATENTS, TRADEMARKS, COPYRIGHTS, LICENSES, ETC.

SCHEDULE 6.1.18

  -    PARTNERSHIP AGREEMENTS; LLC AGREEMENTS

SCHEDULE 6.1.19

  -    INSURANCE POLICIES

SCHEDULE 6.1.23

  -    EMPLOYEE BENEFIT PLAN DISCLOSURES

SCHEDULE 6.1.25

  -    ENVIRONMENTAL DISCLOSURES

SCHEDULE 8.1.16

  -    ASSETS EXCLUDED FROM LIENS

SCHEDULE 8.2.1

  -    PERMITTED INDEBTEDNESS

SCHEDULE 8.2.3

  -    PERMITTED GUARANTIES EXHIBITS         

EXHIBIT 1.1(A)

  -    ASSIGNMENT AND ASSUMPTION AGREEMENT

EXHIBIT 1.1(C)

  -    COLLATERAL TRUST AGREEMENT

EXHIBIT 1.1(D)(1)

  -    DEED OF TRUST (OIL AND GAS - PIPELINE)

EXHIBIT 1.1(D)(2)

  -    TERMINAL INDEMNITY DEED OF TRUST

EXHIBIT 1.1(G)(1)

  -    GUARANTOR JOINDER

EXHIBIT 1.1(G)(2)

  -    GUARANTY AGREEMENT

EXHIBIT 1.1(I)(1)

  -    INDEMNITY

EXHIBIT 1.1(I)(2)

  -    INTERCOMPANY SUBORDINATION AGREEMENT

EXHIBIT 1.1(M)

  -    MORTGAGE

EXHIBIT 1.1(P)(1)

  -    PATENT, TRADEMARK AND COPYRIGHT ASSIGNMENT

EXHIBIT 1.1(P)(2)

  -    PLEDGE AGREEMENT

EXHIBIT 1.1(R)

  -    REVOLVING CREDIT NOTE

EXHIBIT 1.1(S)(1)

  -    SECURITY AGREEMENT

EXHIBIT 1.1(S)(2)

  -    SWING LOAN NOTE

EXHIBIT 2.5.1

  -    LOAN REQUEST; RATE REQUEST

EXHIBIT 2.5.2

  -    SWING LOAN REQUEST

EXHIBIT 7.1.4(A)

  -    OPINION OF COUNSEL

EXHIBIT 7.1.4(B)

  -    OPINION OF MCGUIRE WOODS LLP

EXHIBIT 7.1.4(C)

  -    OPINION OF LOCAL COUNSEL

EXHIBIT 7.1.4(D)

  -    OPINION OF PIPER RUDNICK LLP

EXHIBIT 7.1.15

  -    SOLVENCY CERTIFICATE

EXHIBIT 8.2.6

  -    ACQUISITION COMPLIANCE CERTIFICATE

EXHIBIT 8.3.4

  -    QUARTERLY COMPLIANCE CERTIFICATE

 

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CREDIT AGREEMENT

 

THIS CREDIT AGREEMENT is dated as of June 30, 2004 and is made by and among
CONSOL ENERGY INC., a Delaware corporation (the “Borrower”), each of the
GUARANTORS (as hereinafter defined), the LENDERS (as hereinafter defined),
LASALLE BANK NATIONAL ASSOCIATION, SOCIÉTÉ GÉNÉRALE, NEW YORK BRANCH and
SUNTRUST BANK, each in its capacity as a co-documentation agent, and CITICORP
NORTH AMERICA, INC. and PNC BANK, NATIONAL ASSOCIATION, in their capacity as
co-administrative agents for the Lenders under this Agreement (collectively, the
“Co-Administrative Agents”).

 

WITNESSETH:

 

WHEREAS, the Borrower has requested the Lenders to provide (i) a revolving
credit facility to the Borrower in an aggregate principal amount not to exceed
$400,000,000 with sub-facilities for the issuance of letters of credit and swing
loans, and (ii) Tranche B Credit-Linked Deposits of $200,000,000 for the
issuance of Tranche B Letters of Credit in an aggregate face amount at any time
outstanding of up to $200,000,000; and

 

WHEREAS, the revolving credit and Tranche B letter of credit facilities shall be
used for general corporate purposes of the Loan Parties, including working
capital, capital expenditures and letter of credit needs of the Loan Parties;
and

 

WHEREAS, the Lenders are willing to provide such credit upon the terms and
conditions hereinafter set forth.

 

NOW, THEREFORE, the parties hereto, in consideration of their mutual covenants
and agreements hereinafter set forth and intending to be legally bound hereby,
covenant and agree as follows:

 

1. CERTAIN DEFINITIONS

 

1.1 Certain Definitions.

 

In addition to words and terms defined elsewhere in this Agreement, the
following words and terms shall have the following meanings, respectively,
unless the context hereof clearly requires otherwise:

 

Account shall mean any account, contract right, general intangible, chattel
paper, instrument or document representing any right to payment for goods sold
or services rendered, whether or not earned by performance and whether or not
evidenced by a contract, instrument or document, which is now owned or hereafter
acquired by any Loan Party.

 

Active Operating Properties shall mean all Property subject to any outstanding
Permit relating to the mining extraction, removal, processing, transportation of
coal

 

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or methane gas, or other similar types of activities issued to the Borrower or
any other Loan Party.

 

Affiliate as to any Person shall mean any other Person (i) which directly or
indirectly controls, is controlled by, or is under common control with such
Person, (ii) which beneficially owns or holds 10% or more of any class of the
voting or other equity interests of such Person, or (iii) 10% or more of any
class of voting interests or other equity interests of which is beneficially
owned or held, directly or indirectly, by such Person. Control, as used in this
definition, shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a Person, whether
through the ownership of voting securities, by contract or otherwise, including
the power to elect a majority of the directors or trustees of a corporation or
trust, as the case may be.

 

Agent’s Fee shall have the meaning assigned to that term in Section 10.15.

 

Agreement shall mean this Credit Agreement, as the same may be supplemented,
modified, amended, or restated from time to time, including all schedules and
exhibits.

 

Annual Statements shall have the meaning assigned to that term in Section
6.1.9((i)).

 

Anti-Terrorism Laws shall mean any Laws relating to terrorism or money
laundering, including Executive Order No. 13224, the USA Patriot Act, the Laws
comprising or implementing the Lender Secrecy Act, and the Laws administered by
the United States Treasury Department’s Office of Foreign Asset Control (as any
of the foregoing Laws may from time to time be amended, renewed, extended, or
replaced).

 

Applicable Revolving Letter of Credit Fee Rate shall mean the percentage spread
based on the level of Debt Rating then in effect according to the pricing grid
on Schedule 1.1(A) below the heading “Revolving Letter of Credit Fee.” The
Applicable Revolving Letter of Credit Fee Rate shall be computed in accordance
with the parameters set forth on Schedule 1.1(A).

 

Applicable Tranche B Letter of Credit Fee Rate shall mean the percentage spread
based on the level of Debt Rating then in effect according to the pricing grid
on Schedule 1.1(A) below the heading “Tranche B Letter of Credit Spread.” The
Applicable Tranche B Letter of Credit Fee Rate shall be computed in accordance
with the parameters set forth on Schedule 1.1(A).

 

Applicable Margin shall mean, as applicable:

 

(A) the percentage spread to be added to Base Rate under the Base Rate Option
based on the level of Debt Rating then in effect according to the pricing grid
on Schedule 1.1(A) below the heading “Revolving Credit Base Rate Spread,” and

 

2

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(B) the percentage spread to be added to Euro-Rate under the Euro-Rate Option
based on the level of Debt Rating then in effect according to the pricing grid
on Schedule 1.1(A) below the heading “Revolving Credit Euro-Rate Spread.”

 

The Applicable Margin shall be determined in accordance with the parameters set
forth on Schedule 1.1(A).

 

Approved Fund shall mean with respect to any Lender that is a fund that invests
in bank loans, any other fund that invests in commercial loans and is managed or
advised by the same investment advisor as such Lender or by an Affiliate of such
investment advisor.

 

Assignment and Assumption Agreement shall mean an Assignment and Assumption
Agreement by and among a Purchasing Lender, a Transferor Lender and the Paying
Agent, as Paying Agent and on behalf of the remaining Lenders, substantially in
the form of Exhibit 1.1(A).

 

Authorized Financial Officer of any Person shall mean the chief financial
officer, treasurer or vice-president finance of such Person or, if there is no
chief financial officer or vice-president finance of such Person, a vice
president of such Person, designated by such Person as being a financial officer
authorized to deliver and certify financial information on behalf of the Loan
Parties required hereunder.

 

Authorized Officer shall mean those individuals, designated by written notice to
the Paying Agent from the Borrower, authorized to execute notices, reports and
other documents on behalf of the Loan Parties required hereunder. The Borrower
may amend such list of individuals from time to time by giving written notice of
such amendment to the Paying Agent.

 

Availability shall mean, as of the date of determination, an amount, which
equals the sum of (i) the amount of cash as of such date of the Loan Parties
that is not subject to any Lien or other restriction regarding the use or
investment thereof, (ii) the difference (if a positive number) between the
amount of the Revolving Credit Commitments as of such date, less the Revolving
Exposures as of such date, and (iii) unused availability under the Permitted
Receivables Financing.

 

Available Excess Cash Flow shall mean an amount equal to 50% of the Excess Cash
Flow for the immediately preceding fiscal year.

 

Base Rate shall mean the greater of (i) the interest rate per annum announced
from time to time by the Paying Agent at its Principal Office as its then prime
rate, which rate may not be the lowest rate then being charged commercial
borrowers by the Paying Agent, or (ii) the Federal Funds Open Rate plus 1/2% per
annum.

 

Base Rate Option shall mean the option of the Borrower to have Revolving Credit
Loans bear interest at the rate and under the terms and conditions set forth in
Section 4.1.1(i).

 

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Benchmark LIBOR Rate shall mean the rate per annum, as determined by the Paying
Agent, initially on the Closing Date and reset thereafter on the first Business
Day of each Benchmark LIBOR Interest Period equal to the rate then in effect for
one month Euro-Rate deposits.

 

Benchmark LIBOR Interest Period shall mean, initially, the period commencing on
the Closing Date and ending on the first day of the calendar month immediately
following such Closing Date. Each subsequent Benchmark LIBOR Interest Period
shall begin on the first day of the calendar month and end on the first day of
the next succeeding calendar month. Notwithstanding the second sentence hereof:
(A) any Benchmark LIBOR Interest Period that would otherwise end on a date that
is not a Business Day shall be extended to the next succeeding Business Day
unless such Business Day falls in the next calendar month, in which case such
Benchmark LIBOR Interest Period shall end on the next preceding Business Day,
and (B) in the event that the Benchmark LIBOR Interest Period would otherwise
extend beyond the Tranche B Maturity Date, the Benchmark LIBOR Interest Period
shall end on the Tranche B Maturity Date.

 

Benefit Arrangement shall mean at any time an “employee benefit plan,” within
the meaning of Section 3(3) of ERISA, which is neither a Plan nor a
Multiemployer Plan and which is maintained, sponsored or otherwise contributed
to by any member of the ERISA Group.

 

Black Lung Act shall mean, collectively, the Black Lung Benefits Revenue Act of
1977, as amended and the Black Lung Benefits Reform Act of 1977, as amended.

 

Blocked Person shall have the meaning assigned to such term in Section 6.1.27.2.

 

Borrower shall mean CONSOL Energy Inc., a corporation organized and existing
under the laws of the State of Delaware.

 

Borrowing Date shall mean, with respect to any Loan, the date for the making
thereof or the renewal thereof, which date shall be a Business Day.

 

Borrowing Tranche shall mean specified portions of Loans outstanding as follows:
(i) any Loans to which a Euro-Rate Option applies which become subject to the
same Interest Rate Option under the same Loan Request by the Borrower and which
have the same Interest Period shall constitute one Borrowing Tranche, and (ii)
all Loans to which a Base Rate Option applies shall constitute one Borrowing
Tranche.

 

Business Day shall mean any day other than a Saturday or Sunday or a legal
holiday on which commercial banks are authorized or required to be closed for
business in Pittsburgh, Pennsylvania, and if the applicable Business Day relates
to any Loan to which the Euro-Rate Option applies, such day must also be a day
on which dealings are carried on in the London interbank market.

 

Casualty Event shall mean, with respect to any assets of any Loan Party, any
loss of title to, any damage to or destruction of, or any condemnation or other
taking

 

4

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(including by any Official Body) of, any such assets that occurs after the
Closing Date for which the Borrower or any other Loan Party receives insurance
proceeds or proceeds of a condemnation award or any other compensation;
provided, however, no such event or series of related events shall constitute a
Casualty Event if such proceeds or other compensation in respect thereof is less
than $10,000,000 in the aggregate with respect to such event or series of
related events. Casualty Event shall include but not be limited to any taking of
all or any part of any real property of the Borrower or any other Loan Party in
or by condemnation or other eminent domain proceedings pursuant to any Law, or
by reason of the temporary requisition or the use or occupancy of all or any
part of any real property by any Official Body, civil or military.

 

Closing Date shall mean the Business Day on which the first Loan shall be made,
which shall be June 30, 2004.

 

CNX shall mean CNX Funding Corporation, a Delaware corporation.

 

CNX Accounts shall mean any Account sold to CNX by any Loan Party from time to
time.

 

Co-Administrative Agents shall mean Citicorp North America, Inc. and PNC Bank,
National Association, in their capacity as co-administrative agents for the
Lenders under this Agreement and their respective successors and assigns.

 

Coal shall mean all types of solid naturally occurring hydrocarbons (other than
oil shale or Gilsonite), including without limitation, bituminous and
sub-bituminous coal, and lignite.

 

Coal Act shall mean the Coal Industry Retiree Health Benefits Act of 1992, as
amended.

 

Collateral shall mean the Pledged Collateral, the UCC Collateral, the
Intellectual Property Collateral, the Real Property and the vessels that are the
subject of the Ship Mortgages.

 

Collateral Trust Agreement shall mean the Collateral Trust Agreement,
substantially in the form of Exhibit 1.1(C) hereto, among the Collateral Trustee
and the Loan Parties, as the same may hereafter be modified, amended, restated,
supplemented, refinanced or replaced from time to time in accordance herewith.

 

Collateral Trustee shall mean, individually as the context requires, Wilmington
Trust Company, a Delaware banking corporation, not in its individual capacity
but solely as corporate trustee under the Collateral Trust Agreement (together
with any successor corporate trustee appointed pursuant to the Collateral Trust
Agreement) or David A. Vanaskey, an individual residing in the State of
Delaware, not in his individual capacity but solely as individual trustee under
the Collateral Trust Agreement (together with any successor individual trustee
appointed pursuant to the Collateral Trust Agreement), and Collateral Trustee
shall mean, collectively, as the context requires, both of the foregoing.

 

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Commercial Letter of Credit shall mean any letter of credit which is a
commercial letter of credit issued in respect of the purchase of goods or
services by one or more of the Loan Parties in the ordinary course of their
business.

 

Commitment shall mean as to any Lender the aggregate of its Revolving Credit
Commitment and the Tranche B Credit-Linked Deposit plus, in the case of the
Paying Agent, its Swing Loan Commitment, or any combination thereof (as the
context requires), and Commitments shall mean the aggregate of the Revolving
Credit Commitments, the Tranche B Credit-Linked Deposits, and Swing Loan
Commitments of all of the Lenders.

 

Commitment Fee shall have the meaning assigned to that term in Section 2.3.

 

Compliance Certificate shall have the meaning assigned to such term in Section
8.3.4.

 

Consideration shall mean with respect to any Permitted Acquisition, the
aggregate of (i) the cash paid by any of the Loan Parties, directly or
indirectly, to the seller in connection therewith, (ii) the Indebtedness
incurred or assumed by any of the Loan Parties, whether in favor of the seller
or otherwise and whether fixed or contingent, (iii) any Guaranty given or
incurred by any Loan Party in connection therewith, and (iv) any other
consideration given or obligation incurred by any of the Loan Parties in
connection therewith.

 

Consolidated Cash Interest Expense for any period of determination shall mean,
the amount of interest expense (in each case required in accordance with the
terms of the note, instrument or other agreement applicable thereto to be
payable in cash) of the Borrower and its Subsidiaries for such period determined
and consolidated in accordance with GAAP.

 

Consolidated EBITDA for any period of determination shall mean, without
duplication and to the extent included in determining Consolidated Net Income,
(i) Consolidated Net Income (excluding non-cash compensation expenses related to
common stock and other equity securities issued to employees, extraordinary
gains and losses, gains or losses on discontinued operations, and equity
earnings or losses of Affiliates (other than Consolidated Subsidiaries)) plus
(ii) interest expense (net of interest income), plus (iii) the sum of all income
tax expense, depreciation, depletion and amortization of property, plant,
equipment and intangibles, plus (iv) non-cash debt extinguishment costs, plus
(v) non-cash charges due to cumulative effects of changes in accounting
principles, plus (vi) cash dividends or distributions received from Affiliates
to the extent not included in determining Consolidated Net Income, in each case
of the Borrower and its Subsidiaries for such period determined and consolidated
in accordance with GAAP.

 

Consolidated Net Income shall mean for any period, the consolidated net income
(or loss) of the Borrower and its Consolidated Subsidiaries, determined in
accordance with GAAP.

 

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Consolidated Subsidiaries shall mean those Subsidiaries whose assets,
liabilities and results of operations are or should be consolidated with those
of the Borrower in accordance with GAAP at such time.

 

Contamination shall mean the presence or release or threat of release of
Regulated Substances in, on, under or emanating to or from the Property, which
pursuant to Environmental Laws requires notification or reporting to an Official
Body, or which pursuant to Environmental Laws requires performance of Remedial
Action or that otherwise constitutes a violation of Environmental Laws.

 

Debt Rating shall mean the rating of the Borrower’s Indebtedness under this
Agreement by either of Standard & Poor’s or Moody’s.

 

Designated Letter of Credit Facility shall mean that certain letter of credit
facility, among the Borrower and PNC Bank, dated as of October 10, 2003 and
providing for the issuance of letters of credit for the benefit of the Borrower,
as such facility is in effect on the Closing Date and without regard to any
amendment thereto after the Closing Date.

 

Dollar, Dollars, U.S. Dollars and the symbol $ shall mean lawful money of the
United States of America.

 

Domestic Loan Party shall mean any Loan Party that is incorporated or organized
under the laws of the United States of America or any state or territory
thereof.

 

Drawing Date shall have the meaning assigned to that term in Section 2.9.3.3.

 

Eligible Assignee shall mean any Person, acting for its own account or the
accounts of other Eligible Assignees, who in the aggregate owns and invests on a
discretionary basis, not less than $25 million in (i) securities issued by (a)
entities unaffiliated with the Eligible Assignee, or (b) entities whose
securities are publicly traded; (ii) real estate held for investment purposes;
or (iii) other “Investments”, within the meaning of Section 2(a)(51) of the
Investment Company Act of 1940 and rules adopted thereunder.

 

Environmental Complaint shall mean any written complaint by any Person or
Official Body setting forth a cause of action for personal injury or property
damage, natural resource damage, contribution or indemnity for environmental
response costs, civil or administrative penalties, criminal fines or penalties,
or declaratory or equitable relief arising under any Environmental Laws or any
order, notice of violation, citation or subpoena issued by an Official Body
pursuant to any Environmental Laws.

 

Environmental Laws shall mean all federal, state, local and foreign Laws and
regulations and any consent decrees, settlement agreements, judgments, orders,
directives, policies or programs issued by or entered into with an Official Body
pertaining or relating to: (i) pollution or pollution control; (ii) protection
of human health or the environment; (iii) employee safety in the workplace; (iv)
the presence, use, management, generation, manufacture, processing, extraction,
treatment, recycling, refining, reclamation, labeling,

 

7

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transport, storage, collection, distribution, disposal or release or threat of
release of Regulated Substances; (v) the presence of Contamination; (vi) the
protection of endangered or threatened species; and (vii) the protection of
Environmentally Sensitive Areas.

 

Environmentally Sensitive Area shall mean (i) any wetland as defined by
applicable Environmental Laws; (ii) any area designated as a coastal zone
pursuant to applicable Laws, including Environmental Laws; (iii) any area of
historic or archeological significance or scenic area as defined or designated
by applicable Laws, including Environmental Laws; (iv) habitats of endangered
species or threatened species as designated by applicable Laws, including
Environmental Laws; or (v) a floodplain or other flood hazard area as defined
pursuant to any applicable Laws.

 

ERISA shall mean the Employee Retirement Income Security Act of 1974, as the
same may be amended or supplemented from time to time, and any successor statute
of similar import, and the rules and regulations thereunder, as from time to
time in effect.

 

ERISA Group shall mean, at any time, the Borrower and all members of a
controlled group of corporations and all trades or businesses (whether or not
incorporated) under common control and all other entities which, together with
the Borrower, are treated as a single employer under Section 414 of the Internal
Revenue Code.

 

Euro-Rate shall mean, with respect to the Loans comprising any Borrowing Tranche
to which the Euro-Rate Option applies for any Interest Period, the interest rate
per annum determined by the Paying Agent by dividing (the resulting quotient
rounded upwards, if necessary, to the nearest 1/100th of 1% per annum) (i) the
rate of interest determined by the Paying Agent in accordance with its usual
procedures (which determination shall be conclusive absent manifest error) to be
the average of the London interbank offered rates for U.S. Dollars quoted by the
British Bankers’ Association as set forth on Moneyline Telerate (or appropriate
successor or, if the British Bankers’ Association or its successor ceases to
provide such quotes, a comparable replacement determined by the Paying Agent)
display page 3750 (or such other display page on the Moneyline Telerate service
as may replace display page 3750) two (2) Business Days prior to the first day
of such Interest Period for an amount comparable to such Borrowing Tranche and
having a borrowing date and a maturity comparable to such Interest Period by
(ii) a number equal to 1.00 minus the Euro-Rate Reserve Percentage. The
Euro-Rate may also be expressed by the following formula:

 

Euro-Rate =

 

  

Average of London interbank offered rates quoted

by BBA or appropriate successor as shown on

Moneyline Telerate Service display page 3750

  

1.00 - Euro-Rate Reserve Percentage

 

The Euro-Rate shall be adjusted with respect to any Loan to which the Euro-Rate
Option applies that is outstanding on the effective date of any change in the
Euro-Rate Reserve Percentage as of such effective date. The Paying Agent shall
give prompt notice to the Borrower of the Euro-Rate as determined or adjusted in
accordance herewith, which determination shall be conclusive absent manifest
error.

 

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Euro-Rate Option shall mean the option of the Borrower to have Revolving Credit
Loans bear interest at the rate and under the terms and conditions set forth in
Section 4.1.1((ii)).

 

Euro-Rate Reserve Percentage shall mean as of any day the maximum percentage in
effect on such day, as prescribed by the Board of Governors of the Federal
Reserve System (or any successor) for determining the reserve requirements
(including supplemental, marginal and emergency reserve requirements) with
respect to eurocurrency funding (currently referred to as “Eurocurrency
Liabilities”).

 

Event of Default shall mean any of the events described in Section 9.1 and
referred to therein as an “Event of Default.”

 

Excess Cash Flow shall be computed as of the close of each fiscal year by taking
(a) the sum, without duplication and to the extent included or deducted in
determining Consolidated Net Income, of the following for the Borrower and its
Consolidated Subsidiaries as determined on a consolidated basis in accordance
with GAAP: (i) Consolidated Net Income for such fiscal year, (ii) interest
expense which is not paid in cash during such fiscal year, depreciation,
depletion and amortization for such fiscal year, (iii) extraordinary non-cash
losses during such fiscal year (iv) non-cash losses in connection with asset
dispositions whether or not constituting extraordinary losses, (v) non-cash debt
extinguishment costs, (vi) non-cash charges due to cumulative effects of changes
in accounting principles, (vii) non-cash compensation expenses related to common
stock and other equity securities issued to employees, (viii) cash dividends
received from Affiliates to the extent not included in determining Consolidated
Net Income and (ix) equity losses of Affiliates (other than Consolidated
Subsidiaries) minus (b) the sum, without duplication and to the extent included
in determining Consolidated Net Income, of the following for the Borrower and
its Subsidiaries as determined on a consolidated basis in accordance with GAAP:
(i) Fixed Charges for such fiscal year, (ii) the aggregate amount of prepayment
of Indebtedness (other than prepayments of Revolving Credit Loans and Swing
Loans not accompanied by reductions of the Commitments), (iii) extraordinary
non-cash gains during such fiscal year added in the determination of
Consolidated Net Income for such fiscal year, (iv) non-cash gains in connection
with asset dispositions whether or not constituting extraordinary gains, and (v)
equity earnings of Affiliates (other than Consolidated Subsidiaries).

 

Excess Tranche B Credit-Linked Deposits shall mean, at any time, the excess, if
any, of the total Tranche B Credit-Linked Deposits over the Tranche B LC
Exposure at such time.

 

Excluded Properties shall mean the Real Property interests of the Borrower and
its Subsidiaries set forth specifically or otherwise of a type described on
Schedule 8.1.16.

 

Excluded Subsidiaries shall mean collectively, CNX, Fairmont Supply, each
Foreign Subsidiary and each Subsidiary of the Borrower that is not directly or
indirectly wholly-owned by the Borrower.

 

9

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Executive Order No. 13224 shall mean the Executive Order No. 13224 on Terrorist
Financing, effective September 24, 2001, as the same has been, or shall
hereafter be, renewed, extended, amended or replaced.

 

Existing Credit Agreement shall mean that certain Three Year Credit Agreement
dated September 16, 2002, among the Borrower, the banks, financial institutions
and other institutional lenders and issuers of letter of credit thereto,
Dresdner Bank AG, New York and Grand Cayman Branches and PNC Bank, National
Association, as syndication agents, Solomon Smith Barney Inc. as sole lead
arranger and bookrunner, and Citibank, N.A., as administrative agent for the
lenders.

 

Existing Letters of Credit shall have the meaning assigned to that term in
Section 2.9.1.1.

 

Extraction Title shall mean fee simple title to surface, Coal and/or methane gas
or an undivided interest in fee simple title thereto or a leasehold interest in
all or an undivided interest in surface, Coal and/or methane gas, together with
no less than those real property, easements, licenses, privileges, rights and
appurtenances as are necessary to mine, extract, remove, process and transport
coal or methane gas in the manner presently operated.

 

Fairmont Supply means Fairmont Supply Company, a Delaware corporation.

 

Federal Funds Effective Rate for any day shall mean the rate per annum (based on
a year of 360 days and actual days elapsed and rounded upward to the nearest
1/100 of 1%) announced by the Federal Reserve Lender of New York (or any
successor) on such day as being the weighted average of the rates on overnight
federal funds transactions arranged by federal funds brokers on the previous
trading day, as computed and announced by such Federal Reserve Lender (or any
successor) in substantially the same manner as such Federal Reserve Lender
computes and announces the weighted average it refers to as the “Federal Funds
Effective Rate” as of the date of this Agreement; provided, if such Federal
Reserve Lender (or its successor) does not announce such rate on any day, the
“Federal Funds Effective Rate” for such day shall be the Federal Funds Effective
Rate for the last day on which such rate was announced.

 

Federal Funds Open Rate. The rate per annum determined by the Paying Agent in
accordance with its usual procedures (which determination shall be conclusive
absent manifest error) to be the “open” rate for federal funds transactions as
of the opening of business for federal funds transactions among members of the
Federal Reserve System arranged by federal funds brokers on such day, as quoted
by Garvin Guybutler, any successor entity thereto, or any other broker
reasonably selected by the Lender, as set forth on the applicable Telerate
display page; provided, however that if such day is not a Business Day, the
Federal Funds Open Rate for such day shall be the “open” rate on the immediately
preceding Business Day, or if no such rate shall be quoted by a Federal funds
broker at such time, such other rate as determined by the Paying Agent in
accordance with its usual procedures.

 

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Financial Covenant Debt as of any date of determination shall mean the
difference between the amounts determined under the following clauses (A) and
(B):

 

(A) the sum (without duplication) for the Borrower and its Subsidiaries of the
following: (i) all Indebtedness of the type specified in clauses (a), (b), (c),
(d), (e), (f), (h), and (j) of the definition of Indebtedness, plus (ii) all
reimbursement obligations under standby letters of credit (whether or not issued
under this Agreement), plus (iii) all non-contingent reimbursement or other
matured obligations with respect to Indebtedness of the type specified in clause
(c) of the definition of Indebtedness, minus

 

(B) the sum (without duplication) for the Borrower and its Subsidiaries of the
following but only to the extent that any of the following is included in the
amount determined under clause (A) above: (i) all obligations under undrawn
standby letters of credit (whether or not issued under this Agreement) issued
with respect to performance obligations under sales contracts, performance
obligations with respect to mine reclamation, performance obligations relating
to black lung benefit liabilities, and performance obligations relating to
workers compensation and other employee benefit liabilities, (ii) all
obligations under each other letter of credit in respect of which the Borrower
has provided Letter of Credit Support, but only in an amount equal to such
Letter of Credit Support, and (iii) all obligations in respect of advance
royalty commitments.

 

Financial Projections shall have the meaning assigned to that term in Section
6.1.9((ii)).

 

Fixed Charges shall mean for any period of determination the sum of interest
expense (net of interest income), income taxes paid in cash, scheduled principal
payments on Indebtedness, the aggregate amount of permitted cash capital
expenditures, and cash dividends, in each case of the Borrower and its
Subsidiaries for such period determined and consolidated in accordance with
GAAP.

 

Foreign Subsidiaries shall mean, for any Person, each Subsidiary of such Person
that is incorporated or organized under the laws of any jurisdiction other than
the United States of America or any state or territory thereof.

 

GAAP shall mean generally accepted accounting principles as are in effect from
time to time, subject to the provisions of Section 1.3, and applied on a
consistent basis both as to classification of items and amounts.

 

Gas and Coal Operations shall mean, with respect to the Loan Parties, taken as a
whole, the business operations of the Loan Parties as conducted as of the
Closing Date and as thereafter conducted in reasonable conformity with
operations contemplated in the Financial Projections, including without
limitation coal mining, methane gas recovery, methane gas production and methane
gas transmission activities based upon the mining plans and the methane gas
production and transmission plans used in the preparation of the Financial
Projections.

 

11

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Governmental Acts shall have the meaning assigned to that term in Section 2.9.8.

 

Guarantor shall mean each party to this Agreement that is designated as a
“Guarantor” on the signature page hereof and each other Person that joins this
Agreement as a Guarantor after the date hereof pursuant to Section 11.18.

 

Guarantor Joinder shall mean a joinder by a Person as a Guarantor under this
Agreement, the Guaranty Agreement and the other Loan Documents in the form of
Exhibit 1.1(G)(1).

 

Guaranty of any Person shall mean any obligation of such Person guaranteeing or
in effect guaranteeing any liability or obligation of any other Person in any
manner, whether directly or indirectly, including any agreement to indemnify or
hold harmless any other Person, any performance bond or other suretyship
arrangement and any other form of assurance against loss, except endorsement of
negotiable or other instruments for deposit or collection in the ordinary course
of business.

 

Guaranty Agreement shall mean the Guaranty and Suretyship Agreement in
substantially the form of Exhibit 1.1(G)(2) executed and delivered by each of
the Guarantors to the Paying Agent for the benefit of the Lenders.

 

Historical Statements shall have the meaning assigned to that term in Section
6.1.9((i)).

 

Hybrid Security shall mean any of the following: (i) beneficial interests issued
by a trust or other entity that constitutes a Loan Party, other than the
Borrower, substantially all of the assets of which trust or other entity are
unsecured Indebtedness of such Loan Party or proceeds thereof, and all payments
of which Indebtedness are required to be, and are, distributed to the holder of
beneficial interests in such trust promptly after receipt by such trust, or (ii)
any shares of capital stock or other equity interest that, other than solely at
the option of the issuer thereof, by their terms (or by the terms of any
security into which they are convertible or exchangeable) are, or upon the
happening of an event or the passage of time would be, required to be redeemed
or repurchased, in whole or in part, or have, or upon the happening of an event
or the passage of time, would have, a redemption or similar payment.

 

Indebtedness shall mean, as to any Person at any time, without duplication, (a)
all indebtedness of such Person for borrowed money, (b) all obligations of such
Person evidenced by notes, bonds, debentures or similar instruments or that bear
interest, (c) all reimbursement and other obligations of such Person with
respect to letters of credit and bankers’ acceptances, whether or not matured,
(d) all indebtedness of such Person for the deferred purchase price of property
or services (other than trade payables incurred in the ordinary course of
business and payable in accordance with customary practices that are not overdue
for more than 90 days unless contested in good faith and by appropriate
proceedings if adequate reserves in accordance with GAAP have been established
on the books of such Person and accrued expenses incurred in the ordinary course
of business), (e) all indebtedness of such Person created or arising

 

12

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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), (f) all obligations of such Person under
any capital lease (other than advance royalties under a mineral lease), (g) all
obligations of such Person under any Guaranty provided by such Person in respect
of Indebtedness for borrowed money of another Person, (h) all obligations of
such Person to purchase, redeem, retire, defease or otherwise acquire for value
any capital stock, other equity interest or Hybrid Securities of such Person,
valued, in the case of redeemable preferred stock, at the greater of its
voluntary liquidation preference and its involuntary liquidation preference plus
accrued and unpaid dividends, (i) all net payments that such Person would have
to make in the event of an early termination on the date Indebtedness of such
Person is being determined in respect of any Swap Agreement of such Person, (j)
all indebtedness and other obligations in respect of the Permitted Receivables
Financing of such Person, and (k) all obligations (specifically including all
surety and performance bonds) and other Indebtedness of the type referred to
above secured by (or for which the holder of such Indebtedness has an existing
right, contingent or otherwise, to be secured by) any Lien (other than Liens of
the type described in clauses (iii) and (vi) of the definition of Permitted
Liens and nonconsensual statutory or common law Liens) upon or in property
(including accounts and general intangibles) owned by such Person, even though
such Person has not assumed or become liable for the payment of such
obligations, but only to the extent of the fair market value of such property.

 

Indemnity shall mean the Indemnity Agreement in the form of Exhibit 1.1(I)(1)
executed and delivered by each of the Loan Parties to the Collateral Trustee for
the benefit of the Secured Parties relating to possible environmental
liabilities associated with any of the Property.

 

Ineligible Security shall mean any security which may not be underwritten or
dealt in by member banks of the Federal Reserve System under Section 16 of the
Banking Act of 1933 (12 U.S.C. Section 24, Seventh), as amended.

 

Insolvency Proceeding shall mean, with respect to any Person, (a) a case, action
or proceeding with respect to such Person (i) before any court or any other
Official Body under any bankruptcy, insolvency, reorganization or other similar
Law now or hereafter in effect, or (ii) for the appointment of a receiver,
liquidator, assignee, custodian, trustee, sequestrator, conservator (or similar
official) of any Loan Party or otherwise relating to the liquidation,
dissolution, winding-up or relief of such Person, or (b) any general assignment
for the benefit of creditors, composition, marshaling of assets for creditors,
or other, similar arrangement in respect of such Person’s creditors generally or
any substantial portion of its creditors; undertaken under any Law.

 

Intellectual Property Collateral shall mean all of the property described in the
Patent, Trademark and Copyright Assignment.

 

Intercompany Subordination Agreement shall mean a Subordination Agreement among
the Loan Parties in the form attached hereto as Exhibit 1.1(I)(2).

 

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Interest Coverage Ratio shall mean the ratio of Consolidated EBITDA to
Consolidated Cash Interest Expense, determined as of the end of each fiscal
quarter of the Borrower for the four fiscal quarters then ended.

 

Interest Period shall mean the period of time selected by the Borrower in
connection with (and to apply to) any election permitted hereunder by the
Borrower to have Revolving Credit Loans bear interest under the Euro-Rate
Option. Subject to the last sentence of this definition, such period shall be
one, two, three or six Months if Borrower selects the Euro-Rate Option. Such
Interest Period shall commence on the effective date of such Interest Rate
Option, which shall be (i) the Borrowing Date if the Borrower is requesting new
Loans or renewing Loans under the Euro-Rate Option, or (ii) the date of
conversion to the Euro-Rate Option if the Borrower is converting to the
Euro-Rate Option applicable to outstanding Loans. Notwithstanding the second
sentence hereof: (A) any Interest Period which would otherwise end on a date
which is not a Business Day shall be extended to the next succeeding Business
Day unless such Business Day falls in the next calendar month, in which case
such Interest Period shall end on the next preceding Business Day, and (B) the
Borrower shall not select, convert to or renew an Interest Period for any
portion of the Loans that would end after the Revolving Expiration Date.

 

Interest Rate Option shall mean any Euro-Rate Option or Base Rate Option.

 

Interim Statements shall have the meaning assigned to that term in Section
6.1.9((i)).

 

Internal Revenue Code shall mean the Internal Revenue Code of 1986, as the same
may be amended or supplemented from time to time, and any successor statute of
similar import, and the rules and regulations thereunder, as from time to time
in effect.

 

Investment Grade shall mean a rating of the Borrower’s senior unsecured debt of
not less than both (i) BBB- from Standard & Poor’s and (ii) Baa3 from Moody’s.

 

Investments shall mean collectively all of the following with respect to any
Person: (i) investments or contributions by any of the Loan Parties directly or
indirectly in or to the capital of or other payments to (except in connection
with transactions for the sale of goods or services for fair value in the
ordinary course of business) such Person, (ii) loans or advances by any of the
Loan Parties to such Person, (iii) guaranties by any Loan Party directly or
indirectly of the obligations of such Person, (iv) other credit enhancements of
any Loan Party to or for the benefit of such Person, or (v) if such Loan Party
is liable as a matter of law for the obligations of such Person, obligations,
contingent or otherwise, of such Person. If the nature of an Investment is
tangible property then the amount of such Investment shall be determined by
valuing such property at fair value in accordance with the past practice of the
Loan Parties and such fair values shall be satisfactory to the Paying Agent, in
its reasonable discretion.

 

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Issuing Bank shall mean (a) the Paying Agent or any of the Paying Agent’s
Affiliates in its capacity as the issuer of Letters of Credit hereunder and (b)
the Paying Agent in respect of each Existing Letter of Credit.

 

Labor Contracts shall mean all employment agreements, employment contracts,
collective bargaining agreements and other agreements among any Loan Party and
its employees.

 

Law shall mean any law (including common law), constitution, statute, treaty,
regulation, rule, ordinance, opinion, release, ruling, order, injunction, writ,
decree, bond, judgment, authorization or approval, lien or award by or
settlement agreement with any Official Body.

 

LC Disbursement shall mean a Revolving LC Disbursement or a Tranche B LC
Disbursement.

 

LC Exposure shall mean, at any time, the Revolving LC Exposure and the Tranche B
LC Exposure at such time.

 

Lenders shall mean the financial institutions named on Schedule 1.1(B) and their
respective successors and assigns as permitted hereunder, each of which is
referred to herein as a Lender.

 

Letter of Credit shall mean any Existing Letter of Credit, any Revolving Letter
of Credit or any Tranche B Letter of Credit.

 

Letter of Credit Fees shall mean the Revolving Letter of Credit Fees and the
Tranche B Letter of Credit Fees.

 

Letter of Credit Support shall mean, at any time, the aggregate amount of cash
or other liquid securities pledged as collateral for letters of credit issued
for the account of the Borrower or the other Loan Parties (whether or not issued
pursuant to this Agreement).

 

Leverage Ratio shall mean the ratio of Financial Covenant Debt to Consolidated
EBITDA. For purposes of calculating the Leverage Ratio, Financial Covenant Debt
shall be determined as of the end of each fiscal quarter of the Borrower and
Consolidated EBITDA shall be determined as of the end of each fiscal quarter of
the Borrower for the four fiscal quarters then ended.

 

Lien shall mean any mortgage, deed of trust, pledge, lien, security interest,
charge or other encumbrance or security arrangement of any nature whatsoever,
whether voluntarily or involuntarily given, including any conditional sale or
title retention arrangement, and any assignment, deposit arrangement or lease
intended as, or having the effect of, security and any filed financing statement
or other notice of any of the foregoing (whether or not a lien or other
encumbrance is created or exists at the time of the filing), but shall not
include any operating lease.

 

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LLC Interests shall have the meaning given to such term in Section 6.1.3.

 

Loan Documents shall mean this Agreement, the Paying Agent’s Letter, the
Collateral Trust Agreement, the Guaranty Agreement, the Indemnity, the
Intercompany Subordination Agreement, the Mortgages, the Ship Mortgages, the
Notes, the Patent, Trademark and Copyright Assignment, the Pledge Agreement, the
Security Agreement and any other instruments, certificates or documents
(expressly excluding any Specified Swap Agreement or any other Swap Agreement)
delivered or contemplated to be delivered hereunder or thereunder or in
connection herewith or therewith, as the same may be supplemented or amended
from time to time in accordance herewith or therewith, and Loan Document shall
mean any of the Loan Documents.

 

Loan Parties shall mean the Borrower and the Guarantors.

 

Loan Request shall have the meaning given to such term in Section 2.5.

 

Loans shall mean collectively and Loan shall mean separately all Revolving
Credit Loans and Swing Loans or any Revolving Credit Loan or Swing Loan.

 

Material Adverse Change shall mean any set of circumstances or events that (a)
has or would reasonably be expected to have any material adverse effect
whatsoever upon the validity or enforceability of this Agreement or any other
Loan Document, (b) is or would reasonably be expected to be material and adverse
to the business, properties, assets, financial condition, or results of
operations of the Loan Parties taken as a whole, (c) impairs materially or would
reasonably be expected to impair materially the ability of the Loan Parties
taken as a whole to duly and punctually pay or perform their Indebtedness under
this Agreement or any other Loan Document, or (d) impairs materially or would
reasonably be expected to impair materially the ability of the Paying Agent or
any of the Lenders, to the extent permitted, to enforce their legal remedies
pursuant to this Agreement or any other Loan Document.

 

Material Contract shall mean the Senior Notes (1991), the Senior Notes (2002)
and any other agreement that is material to the conduct of the business of the
Loan Parties, taken as a whole.

 

Month, with respect to an Interest Period under the Euro-Rate Option, shall mean
the interval between the days in consecutive calendar months numerically
corresponding to the first day of such Interest Period. If any Euro-Rate
Interest Period begins on a day of a calendar month for which there is no
numerically corresponding day in the month in which such Interest Period is to
end, the final month of such Interest Period shall be deemed to end on the last
Business Day of such final month.

 

Moody’s shall mean Moody’s Investors Service, Inc. and its successors.

 

Mortgages shall mean, collectively, the Mortgages in substantially the form of
(i) Exhibit 1.1(D)(1), (ii) Exhibit 1.1(D)(2), or (iii) Exhibit 1.1(M) (as
applicable for the specific Real Property) with respect to the Real Property
executed and delivered by certain of the

 

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Loan Parties to the Collateral Trustee for the benefit of the Secured Parties,
and Mortgage shall mean, individually, any of the Mortgages.

 

Multiemployer Plan shall mean any employee benefit plan which is a
“multiemployer plan” within the meaning of Section 4001(a)(3) of ERISA and to
which the Borrower or any member of the ERISA Group is then making or accruing
an obligation to make contributions or, within the preceding five Plan years,
has made or had an obligation to make such contributions.

 

Multiple Employer Plan shall mean a Plan which has two or more contributing
sponsors (including the Borrower or any member of the ERISA Group) at least two
of whom are not under common control, as such a plan is described in Sections
4063 and 4064 of ERISA.

 

Net Cash Proceeds shall mean, with respect to any transaction or Casualty Event,
an amount equal to:

 

(a) the cash proceeds received by the Borrower or any other Loan Party from or
in respect of such transaction or Casualty Event (including, when received: (i)
any cash proceeds received as income or other deferred cash proceeds, or (ii)
cash proceeds of any non-cash proceeds of such transaction, converted to cash),
less

 

(b) the sum of the following to the extent incurred or payable by the Borrower
or any other Loan Party:

 

(i) in the case of any asset sale or disposition permitted pursuant to Section
8.2.7 (ix), any foreign, federal, state or local income taxes paid or payable in
respect of the proceeds of such sale or disposition or any other foreign,
federal, state or local taxes paid in connection with such sale or disposition,
with all amounts under this clause (b)(i) being determined for the Borrower and
its Subsidiaries on a tax consolidated basis (after application of all credits
and other offsets),

 

(ii) in the case of a Casualty Event, any taxes paid or payable in respect of
the amount so recovered as determined for the Borrower and its Subsidiaries on a
tax consolidated basis (after application of all credits and other offsets),

 

(iii) in the case of any asset sale or disposition permitted pursuant to Section
8.2.7 (ix), any customary and reasonable brokerage commissions and all other
customary and reasonable fees and expenses related to such sale or disposition
(including without limitation financial advisory fees, legal fees and
accountants’ fees),

 

(iv) in the case of a Casualty Event, any customary and reasonable fees and
expenses in connection with the recovery of the cash proceeds of any insurance,
condemnation award or other compensation received by the

 

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Person whose property was subject to the Casualty Event (including without
limitation financial advisory fees, legal fees and accountants’ fees),

 

(v) in the case of any issuance of debt, equity or Hybrid Securities by the
Borrower or any other Loan Party, all investment banking fees, commissions,
legal fees, consulting fees, accountants’ fees, underwriting fees and discounts
and other customary and reasonable fees and expenses actually incurred in
connection therewith,

 

(vi) in the case of any asset sale or disposition permitted pursuant to Section
8.2.7 (ix), any amounts estimated in good faith by an Authorized Financial
Officer of the Borrower to provide reserves in accordance with GAAP for payment
of indemnities or liabilities that may be incurred in connection with such sale
or disposition,

 

(vii) in the case of any asset sale or disposition permitted pursuant to Section
8.2.7 (ix) the amount of any debt secured by a Lien on the related asset and
which debt is discharged as part of such asset sale; and

 

(viii) in the case of a Casualty Event or any asset sale or disposition
permitted pursuant to Section 8.2.7(ix), any insurance proceeds, condemnation
awards or other compensation to the extent such proceeds are used for
reinvestment, substitution, replacement, repair or restoration in accordance
with the terms hereof.

 

For purposes of this definition, if taxes or other customary fees or expenses
payable in connection with a Casualty Event or the sale or other disposition of
any asset are not known as of the date of such sale or other disposition, then
such fees, expenses or taxes shall be estimated in good faith by an Authorized
Financial Officer of the Borrower and such estimated amounts shall be deducted
for purposes of determining Net Cash Proceeds in accordance with the immediately
preceding sentence.

 

Non-Strategic Assets shall mean all those assets of the Loan Parties that (i)
qualify as Excluded Properties and (ii) could be sold or disposed of by the Loan
Parties without causing any material effect on, or increased cost to, the
operation and management of the Gas and Coal Operations.

 

Note Agreement (1991) shall mean that certain Issuing and Paying Agency
Agreement dated as of December 31, 1991 among Consolidation Coal Company,
Consol, Inc., Consol Energy, Inc. and Morgan Guaranty Trust Company of New York.

 

Notes shall mean the Revolving Credit Notes and Swing Loan Note.

 

Notices shall have the meaning assigned to that term in Section 11.6.

 

Obligation shall mean any obligation or liability of any of the Loan Parties to
the Paying Agent, any of the Co-Administrative Agents or any of the Lenders,
howsoever

 

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created, arising or evidenced, whether direct or indirect, absolute or
contingent, now or hereafter existing, or due or to become due, under or in
connection with this Agreement, the Notes, the Letters of Credit, the Paying
Agent’s Letter or any other Loan Document. Obligations shall include the
liabilities arising under any Specified Swap Agreement but shall not include the
liabilities to other Persons under any other Swap Agreement.

 

Official Body shall mean any national, federal, state, local or other government
or political subdivision or any agency, authority, board, bureau, central bank,
commission, department or instrumentality of either, or any court, tribunal,
grand jury or arbitrator, in each case whether foreign or domestic.

 

Ordinary Course Obligation shall mean any liability or obligation (but expressly
excluding Indebtedness) incurred by the Borrower or any other Loan Party in the
ordinary course of its business and consistent with past practice, including,
without limitation any liability or obligation (expressly excluding
Indebtedness) in respect of workers’ compensation, unemployment insurance or
other forms of governmental insurance or benefits, to secure performance of
tenders, to secure performance of statutory obligations, to secure performance
of leases or contracts, or to secure obligations on surety or appeal bonds.

 

Partnership Interests shall have the meaning given to such term in Section
6.1.3.

 

Patent, Trademark and Copyright Assignment shall mean the Patent, Trademark and
Copyright Security Agreement in substantially the form of Exhibit 1.1(P)(1)
executed and delivered by each of the Loan Parties to the Collateral Trustee for
the benefit of the Secured Parties.

 

Paying Agent shall mean PNC Bank, National Association in its capacity as
administrative agent for the Lenders under this Agreement, and its successors
and assigns.

 

Paying Agent’s Letter shall have the meaning assigned to that term in Section
10.15.

 

PBGC shall mean the Pension Benefit Guaranty Corporation established pursuant to
Subtitle A of Title IV of ERISA or any successor.

 

Permits shall mean all franchises, licenses, permits, consents, certificates,
concessions, approvals, and authorizations of all governmental authorities
necessary for the conduct of the business of the Borrower and the other Loan
Parties.

 

Permitted Acquisitions shall have the meaning assigned to such term in Section
8.2.6.

 

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Permitted Investments shall mean:

 

(i) direct obligations of the United States of America or any agency or
instrumentality thereof or obligations backed by the full faith and credit of
the United States of America;

 

(ii) commercial paper (A) rated not lower than A-1, by Standard & Poor’s or P-1
by Moody’s Investors Service, Inc. on the date of acquisition or (B) issued by
any of (x) the Paying Agent, (y) any Co-Administrative Agent, or (z) any Lender;

 

(iii) demand deposits, time deposits or certificates of deposit and other
obligations issued by any of (w) the Paying Agent, (x) any Co-Administrative
Agent, (y) any Lender, or (z) any other domestic or foreign commercial bank that
has stockholders equity of $100,000,000 or more on the date of acquisition;

 

(iv) obligations of any foreign government or obligations that possess a
guaranty of the full faith and credit of any foreign government;

 

(v) obligations of any of the following:

 

(a) United States government-sponsored enterprises, federal agencies, and
federal financing banks that are not otherwise authorized including, but not
limited to, the following:

 

(i) United States government-sponsored enterprises such as instrumentalities of
the Federal Credit System (Bank for Cooperatives, Federal Land Banks), Federal
Home Loan Banks and Federal National Mortgage Association; and

 

(ii) Federal agencies such as instrumentalities of the Department of Housing and
Urban Development (Federal Housing Administration, Government National Mortgage
Association), Export-Import Bank, Farmers Home Administration and Tennessee
Valley Authority;

 

(vi) obligations of states, counties, and municipalities of the United States;

 

(vii) debt obligations (other than commercial paper obligations) of domestic or
foreign corporations;

 

(viii) preferred stock obligations with a floating rate dividend that is reset
periodically at auction;

 

(ix) investments in repurchase agreements collateralized by any of the above
securities eligible for outright purchase, provided the collateral is delivered
to a bank custody account in accordance with the terms of a written repurchase
agreement with a dealer or bank; and

 

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(x) investments in shares of institutional mutual funds whose investment
policies are essentially in agreement with the above type and criteria for
investments otherwise set forth in this definition of Permitted Investments,

 

provided that investments described in clauses (i), (iv), (v), (vi), (vii),
(viii), (ix) and (x) above are restricted to obligations rated no lower than A-3
by Moody’s or A- by Standard & Poor’s.

 

Permitted Liens shall mean:

 

(i) Liens for taxes, assessments, or similar charges, incurred in the ordinary
course of business and which are not yet due and payable or the validity of
which are being contested in good faith by appropriate proceedings and as to
which appropriate reserves have been established in accordance with GAAP;

 

(ii) Pledges or deposits made in the ordinary course of business to secure
payment of workmen’s compensation, or to participate in any fund in connection
with workmen’s compensation, unemployment insurance, old-age pensions or other
social security programs (including pledges or deposits of cash securing Letters
of Credit that secure payment of such workmen’s compensation, unemployment
insurance, old-age pensions or other social security programs);

 

(iii) Liens of mechanics, materialmen, warehousemen, carriers, or other like
Liens (including any other statutory nonconsensual or common law Liens),
securing obligations incurred in the ordinary course of business that are not
yet due and payable and Liens of landlords securing obligations to pay lease
payments that are not yet due and payable or in default (including pledges or
deposits of cash securing Letters of Credit that secure such Liens of landlords
securing obligations to make lease payments that are not yet due and payable or
in default) or, with respect to any of the foregoing, that are being contested
in good faith by appropriate proceedings and as to which appropriate reserves
have been established in accordance with GAAP;

 

(iv) Good-faith pledges or deposits made in the ordinary course of business to
secure performance of bids, tenders, contracts (other than for the repayment of
borrowed money) or leases, not in excess of the aggregate amount due thereunder,
or to secure statutory obligations, or surety, appeal, indemnity, performance or
other similar bonds required in the ordinary course of business (including
pledges or deposits of cash securing Letters of Credit that secure such
performance of bids, tenders, contracts (other than for the repayment of
borrowed money) or leases, not in excess of the aggregate amount due thereunder,
or that secure such statutory obligations, or such surety, appeal, indemnity,
performance or other similar bonds required in the ordinary course of business);

 

(v) Encumbrances consisting of zoning restrictions, licenses, easements or other
restrictions on the use of real property, and other matters affecting, or
irregularities in, title thereto, none of which materially impairs the use of
such property or the value thereof, and none of which is violated in any
material respect by existing or proposed structures or land use;

 

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(vi) Liens, security interests and mortgages in favor of the Collateral Trustee
for the benefit of the Secured Parties securing (a) the Obligations including
liabilities under any Specified Swap Agreement and (b) the Secured Debt (as
defined in the Collateral Trust Agreement);

 

(vii) Liens on property leased by any Loan Party under capital leases securing
obligations of such Loan Party to the lessor under such leases, provided that
the aggregate amount of Indebtedness secured by such Liens shall not exceed the
amount of Indebtedness permitted by Section 8.2.1(x);

 

(viii) Any Lien existing on the date of this Agreement and described on Schedule
1.1(P), provided that no additional assets become subject to such Lien;

 

(ix) Purchase Money Security Interests, provided that the aggregate amount of
loans and deferred payments secured by such Purchase Money Security Interests
shall not exceed $25,000,000 (excluding for the purpose of this computation any
loans or deferred payments secured by Liens described on Schedule 1.1(P));

 

(x) Subject to the terms of the Collateral Trust Agreement, Liens on the Shared
Collateral securing the Senior Notes (1991);

 

(xi) Subject to the terms of the Collateral Trust Agreement, Liens on the Shared
Collateral securing the Senior Notes (2002);

 

(xii) Liens to secure obligations under the Permitted Receivables Financing, in
those Accounts or contracts giving rise to Accounts of the Borrower or any Loan
Party or of the Securitization Subsidiary, which Accounts or contracts giving
rise to Accounts are either to be sold by the Borrower or any Loan Party to the
Securitization Subsidiary as part of the Permitted Receivables Financing or that
are an asset of the Securitization Subsidiary;

 

(xiii) Liens in stock or assets permitted to be acquired pursuant to Sections
8.2.4 and 8.2.6 granted to secure Indebtedness incurred at the time of such
acquisition of such stock or assets (or within one year thereof) to finance the
acquisition of such stock or assets, provided that no additional assets become
subject to such Liens;

 

(xiv) Statutory and common law banker’s Liens and rights of setoff on bank
deposits;

 

(xv) Liens existing on any assets at the date of acquisition of such assets, as
such acquisition is permitted by Sections 8.2.4 and 8.2.6, provided that no
additional assets become subject to such Liens;

 

(xvi) Any Lien arising out of the refinancing, extension, renewal or refunding
of any Indebtedness secured by any Lien that is permitted by clauses (viii),
(xiii) or (xv), provided that such Indebtedness is not increased when so
refinanced, extended, renewed or refunded and that no additional assets become
subject to such Liens;

 

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(xvii) Liens, not otherwise permitted by any other clause of this definition of
Permitted Liens, that are either (i) on any of the Excluded Properties, or (ii)
subordinated (either expressly or by operation of law) to the Liens on the
Collateral which secure the Obligations, provided that the amount of
Indebtedness secured shall not exceed the amount permitted by Section 8.2.1(x);

 

(xviii) Claims, Liens or encumbrances upon, and defects of title to, real or
personal property other than the Collateral, including any attachment of
personal or real property or real property or other legal process prior to
adjudication of a dispute on the merits, (A) if the validity or amount thereof
is being contested in good faith by appropriate and lawful proceedings
diligently conducted so long as levy and execution thereon have been stayed and
continue to be stayed, (B) if a final judgment is entered and such judgment is
discharged within thirty (30) days of entry, or (C) the payment of which is
covered in full (subject to customary deductible) by insurance;

 

(xix) Liens arising out of final judgments, awards, or orders, which are bonded
or stayed pending appeal within a period of thirty (30) days from the date of
entry; and

 

(xx) Precautionary filings under the UCC by a lessor with respect to personal
property leased to such Person to the extent such lease is permitted hereunder
and under the other Loan Documents.

 

Permitted Receivables Financing shall mean (A) the Receivables Purchase
Agreement, or (B) any replacement of the Receivables Purchase Agreement
consisting of a transaction or series of transactions pursuant to which the
Securitization Subsidiary purchases Accounts and related rights or contracts
giving rise to Accounts from any Loan Party and finances such Accounts through
the issuance of Indebtedness or equity interests or through the sale of such
accounts; provided that (a) the Borrower shall have determined in good faith
that such Permitted Receivables Financing is economically fair and reasonable to
the Borrower and each other Loan Party, (b) all sales of Accounts to the
Securitization Subsidiary are made at fair market value (as determined in good
faith by the Borrower), (c) the provisions thereof shall be market terms (as
determined in good faith by the Borrower), (d) no portion of the Indebtedness of
the Securitization Subsidiary is guaranteed by or is recourse to the Borrower or
any of the other Loan Parties (other than recourse for customary
representations, warranties, covenants and indemnities, none of which shall
related to the collectibility of such Accounts), (e) neither the Borrower nor
any of the other Loan Parties has any obligation to maintain or preserve such
Securitization Subsidiary’s financial condition, (f) the aggregate “capital” or
other liabilities of the Securitization Subsidiary under the transaction shall
not exceed $200,000,000, and (g) the such transaction shall otherwise be under
terms no less favorable to the Securitization Subsidiary and the Loan Parties
than the terms of the Receivables Purchase Agreement.

 

Person shall mean any individual, corporation, partnership, limited liability
company, association, joint-stock company, trust, unincorporated organization,
joint venture, government or political subdivision or agency thereof, or any
other entity.

 

23

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Plan shall mean at any time an employee pension benefit plan (including a
Multiple Employer Plan, but not a Multiemployer Plan) which is covered by Title
IV of ERISA or is subject to the minimum funding standards under Section 412 of
the Internal Revenue Code and either (i) is maintained by any member of the
ERISA Group for employees of any member of the ERISA Group or (ii) has at any
time within the preceding five years been maintained by any entity which was at
such time a member of the ERISA Group for employees of any entity which was at
such time a member of the ERISA Group.

 

Pledge Agreement shall mean the Pledge Agreement in substantially the form of
Exhibit 1.1(P)(2) executed and delivered by the Borrower and each other Loan
Party to the Collateral Trustee for the benefit of the Secured Parties.

 

Pledged Collateral shall mean the property of certain of the Loan Parties in
which security interests are to be granted under the Pledge Agreement.

 

PNC Bank shall mean PNC Bank, National Association, its successors and assigns.

 

Potential Default shall mean any event or condition which with notice, passage
of time, or any combination of the foregoing, would constitute an Event of
Default.

 

Principal Office shall mean the main banking office of the Paying Agent in
Pittsburgh, Pennsylvania.

 

Prior Security Interest shall mean a valid and enforceable perfected
first-priority security interest under the Uniform Commercial Code in the UCC
Collateral and the Pledged Collateral which is subject only to Liens for taxes
not yet due and payable to the extent such prospective tax payments are given
priority by statute or Purchase Money Security Interests as permitted hereunder.

 

Prohibited Transaction shall mean any prohibited transaction as defined in
Section 4975 of the Internal Revenue Code or Section 406 of ERISA for which
neither an individual nor a class exemption has been issued by the United States
Department of Labor.

 

Property shall mean all real property, both owned and leased, of any Loan Party.

 

Purchase Money Security Interest shall mean Liens upon tangible personal
property securing loans to any Loan Party or deferred payments by such Loan
Party for the purchase of such tangible personal property.

 

Purchasing Lender shall mean a Lender which becomes a party to this Agreement by
executing an Assignment and Assumption Agreement.

 

Ratable Share shall mean, (a) with respect to any Revolving Lender, the portion
of the total Revolving Credit Commitments represented by such Lender’s Revolving
Credit Commitment and (b) with respect to any Tranche B Lender, the portion of
the total

 

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Tranche B Credit-Linked Deposits represented by such Lender’s Tranche B
Credit-Linked Deposit. If the Revolving Credit Commitments have terminated or
expired, the Ratable Percentage with respect to any Revolving Lender shall be
determined based upon the Revolving Credit Commitments most recently in effect,
giving effect to any assignments. If the Tranche B Credit-Linked Deposits shall
have been applied in full to reimburse Tranche B LC Disbursements, the Ratable
Share with respect to any Tranche B Lender shall be determined based upon the
total Tranche B Credit-Linked Deposits most recently in effect, giving effect to
any assignments.

 

Receivables Purchase Agreement shall mean that certain agreement, dated as of
April 30, 2003, by and among CNX Funding Corporation, the Borrower, the
Subsidiaries of the Borrower party thereto, Market Street Funding Corporation
and PNC Bank, National Association, as supplemented, modified, amended,
restated, amended and restated or replaced from time to time as permitted by
Section 8.2.14.

 

Real Property shall mean, individually as the context requires, the surface,
Coal, methane gas and other mineral rights, interests and coal leases associated
with the properties described on Schedule 1.1(R), and Real Property shall mean,
collectively, as the context requires, all of the foregoing.

 

Regulated Substances shall mean, without limitation, any substance, material or
waste, regardless of its form or nature, defined under Environmental Laws as a
“hazardous substance,” “pollutant,” “pollution,” “contaminant,” “hazardous or
toxic substance,” “extremely hazardous substance,” “toxic chemical,” “toxic
substance,” “toxic waste,” “hazardous waste,” “special handling waste,”
“industrial waste,” “residual waste,” “solid waste,” “municipal waste,” “mixed
waste,” “infectious waste,” “chemotherapeutic waste,” “medical waste,” or
“regulated substance” or any other material, substance or waste, regardless of
its form or nature, which otherwise is regulated by Environmental Laws.

 

Regulation U shall mean Regulation U, T or X as promulgated by the Board of
Governors of the Federal Reserve System, as amended from time to time.

 

Reimbursement Obligation shall have the meaning assigned to such term in Section
2.9.3.3.

 

Reportable Event shall mean a reportable event described in Section 4043 of
ERISA and regulations thereunder with respect to a Plan or Multiemployer Plan.

 

Required Environmental Notices shall mean all notices, reports, plans, forms or
other filings which pursuant to Environmental Laws, Required Environmental
Permits or at the request or direction of an Official Body either must be
submitted to an Official Body or which otherwise must be maintained.

 

Required Environmental Permits shall mean all permits, licenses, bonds,
consents, programs, approvals or authorizations required under Environmental
Laws to own, occupy or maintain the Property or which otherwise are required for
the operations and business activities of the Borrower or Guarantors.

 

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Required Lenders means, at any time, Lenders having Revolving Exposures, Tranche
B LC Exposure, unused Revolving Credit Commitments and Excess Tranche B
Credit-Linked Deposits representing more than 50% of the sum of the total
Revolving Exposures, outstanding Tranche B LC Exposure, unused Revolving Credit
Commitments and Excess Tranche B Credit-Linked Deposits at such time.

 

Responsible Officer shall mean each of the chief executive officer, president,
chief financial officer and treasurer of each Loan Party, or (i) with respect to
Cardinal States Gathering Company, a Virginia general partnership, at any time
such general partnership does not have one of the foregoing officers, its
management committee representative and (ii) with respect to Greene Energy LLC,
a Pennsylvania limited liability company, its manager.

 

Revolving Availability Period shall mean the period from and including the
Closing Date to but excluding the earlier of the Revolving Expiration Date and
the date of termination of the Revolving Credit Commitments.

 

Revolving Credit Commitment shall mean, as to any Lender at any time, the amount
initially set forth opposite its name on Schedule 1.1(B) in the column labeled
“Amount of Commitment for Revolving Credit Loans,” and thereafter on Schedule I
to the most recent Assignment and Assumption Agreement, and Revolving Credit
Commitments shall mean the aggregate Revolving Credit Commitments of all of the
Lenders.

 

Revolving Credit Loans shall mean collectively and Revolving Credit Loan shall
mean separately all Revolving Credit Loans or any Revolving Credit Loan made by
the Lenders or one of the Lenders to the Borrower pursuant to Section 2.1 or
2.9.3.

 

Revolving Credit Notes shall mean collectively and Revolving Credit Note shall
mean separately all the Revolving Credit Notes of the Borrower in the form of
Exhibit 1.1(R) evidencing the Revolving Credit Loans together with all
amendments, extensions, renewals, replacements, refinancings or refundings
thereof in whole or in part.

 

Revolving Credit Ratable Share shall mean the proportion that a Lender’s
Revolving Credit Commitment (excluding the Swing Loan Commitment) bears to the
Revolving Credit Commitments (excluding the Swing Loan Commitment) of all the
Lenders.

 

Revolving Expiration Date shall mean, with respect to the Revolving Credit
Commitments, June 30, 2009.

 

Revolving Exposure shall mean, with respect to any Revolving Lender at any time,
the sum of the outstanding principal amount of such Revolving Lender’s Revolving
Credit Loans and its Revolving LC Exposure and Swingline Exposure at such time.

 

Revolving LC Disbursement shall mean a payment made by the Issuing Bank pursuant
to a Revolving Letter of Credit.

 

Revolving LC Exposure shall mean, at any time, the sum of (a) the aggregate
undrawn amount of all outstanding Revolving Letters of Credit at such time, plus
(b)

 

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the aggregate amount of all unpaid and outstanding Reimbursement Obligations
arising from Revolving Letters of Credit and Revolving Letter of Credit
Borrowings. The Revolving LC Exposure of any Revolving Lender at any time shall
be its Ratable Share of the total Revolving LC Exposure at such time.

 

Revolving Lender shall mean a Lender with a Revolving Credit Commitment or, if
the Revolving Credit Commitments have terminated or expired, a Lender with a
Revolving Exposure.

 

Revolving Letter of Credit shall mean, at any time, any Revolving Letter of
Credit issued pursuant to Section 2.9.1 of this Agreement, other than Tranche B
Letters of Credit.

 

Revolving Letter of Credit Borrowing shall have the meaning assigned to such
term in Section 2.9.3.3(iii).

 

Revolving Letter of Credit Fees shall have the meaning assigned to that term in
Section 2.9.2.1.

 

Revolving Participation Advance shall mean, with respect to any Lender, such
Lender’s payment in respect of its participation in a Revolving Letter of Credit
Borrowing according to its Revolving Credit Ratable Share pursuant to Section
2.9.3.3(iii).

 

Section 20 Subsidiary shall mean the Subsidiary of the bank holding company
controlling any Lender, which Subsidiary has been granted authority by the
Federal Reserve Board to underwrite and deal in certain Ineligible Securities.

 

Secured Parties shall mean collectively, the Collateral Trustee, the
Co-Administrative Agents, the Lenders, any provider of a Specified Swap
Agreement, The Bank of Nova Scotia Trust Company of New York or any successor
thereto as paying agent with respect to the Senior Notes (1991) and trustee with
respect to the Senior Notes (2002) and any other holders from time to time of
the Senior Notes (1991) and Senior Notes (2002).

 

Securitization Subsidiary shall mean CNX, which is a Subsidiary of the Borrower
(all of the outstanding equity interests of which, other than de minimis
preferred stock and director’s qualifying shares, if any, are owned, directly or
indirectly, by the Borrower) and a special purpose vehicle established for the
limited purpose of acquiring and financing Accounts and contracts giving rise to
Accounts of the Borrower or any Loan Party and engaging in activities ancillary
thereto, all in connection with the transactions contemplated by the Permitted
Receivables Financing.

 

Security Agreement shall mean the Security Agreement in substantially the form
of Exhibit 1.1(S)(1) executed and delivered by each of the Loan Parties to the
Collateral Trustee for the benefit of the Secured Parties.

 

Senior Notes (1991) shall mean the outstanding senior bonds, notes, debentures
and other evidences of indebtedness of the Borrower, issued pursuant to that
certain Issuing and Paying Agency Agreement, dated December 31, 1991, among the
Borrower, certain

 

27

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of its Subsidiaries, and Morgan Guaranty Trust Company of New York, as trustee,
as supplemented, modified, amended, or restated from time to time. As of the
Closing Date, The Bank of Nova Scotia Trust Company of New York is the trustee
under the foregoing instrument.

 

Senior Notes (2002) shall mean the outstanding senior notes of the Borrower,
issued pursuant to that certain Indenture, dated March 7, 2002, among the
Borrower, certain of its Subsidiaries, and The Bank of Nova Scotia Trust Company
of New York, as trustee, as supplemented, modified, amended, or restated from
time to time.

 

Settlement Date shall have the meaning assigned to that term in Section 5.7.

 

Shared Collateral shall mean the Liens on the Collateral which equally, ratably
and on a pari-passu basis secure the Obligations, the Senior Notes (1991), and
the Senior Notes (2002) in accordance with the Collateral Trust Agreement.

 

Ship Mortgages shall mean collectively and Ship Mortgage shall mean separately
all ship mortgages or any ship mortgage, in a form acceptable to the
Co-Administrative Agents, with respect to all vessels registered by the Loan
Parties with the U.S. Coast Guard, executed and delivered by certain of the Loan
Parties to the Collateral Trustee for the benefit of the Secured Parties.

 

Solvent shall mean, with respect to any Person on a particular date, that on
such date (i) the fair value of the property of such Person is greater than the
total amount of liabilities, including, without limitations, contingent
liabilities, of such Person, (ii) the present fair saleable value of the assets
of such Person is not less than the amount that will be required to pay the
probable liability of such Person on its debts as they become absolute and
matured, (iii) such Person is able to realize upon its assets and pay its debts
and other liabilities, contingent obligations and other commitments as they
mature in the normal course of business, (iv) such Person does not intend to,
and does not believe that it will, incur debts or liabilities beyond such
Person’s ability to pay as such debts and liabilities mature, and (v) such
Person is not engaged in business or a transaction, and is not about to engage
in a business or a transaction, for which such Person’s property would
constitute unreasonably small capital after giving due consideration to the
prevailing practice in the industry in which such Person is engaged. In
computing the amount of contingent liabilities at any time, it is intended that
such liabilities will be computed at the amount which, in light of all the facts
and circumstances existing at such time, represents the amount that can
reasonably be expected to become an actual or matured liability.

 

Specified Swap Agreement shall mean any Swap Agreement (a) entered into by (i)
any Loan Party and (ii) any Lender or any affiliate thereof, or any Person that
was a Lender or an affiliate thereof when such Swap Agreement was entered into
as counterparty and (b) that has been designated by such Lender and the
Borrower, by notice to the Paying Agent not later than thirty (30) days after
the execution and delivery thereof by the Borrower, as a Specified Swap
Agreement; provided that the designation of any Swap Agreement as a Specified
Swap Agreement shall not create in favor of any Lender or Affiliate thereof that
is a party thereto any

 

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rights in connection with the management or release of any Collateral or of the
obligations of any Loan Party under any of the Loan Documents.

 

Standard & Poor’s shall mean Standard & Poor’s Ratings Services, a division of
The McGraw-Hill Companies, Inc.

 

Standby Letter of Credit shall mean a Letter of Credit issued to support
obligations of one or more of the Loan Parties, contingent or otherwise, which
finance the working capital and business needs of the Loan Parties incurred in
the ordinary course of business, but excluding any Letter of Credit under which
the stated amount of such Letter of Credit increases automatically over time.

 

Subsidiary of any Person at any time shall mean (i) any corporation or trust of
which more than 50% (by number of shares or number of votes) of the outstanding
capital stock or shares of beneficial interest normally entitled to vote for the
election of one or more directors or trustees (regardless of any contingency
which does or may suspend or dilute the voting rights) is at such time owned
directly or indirectly by such Person or one or more of such Person’s
Subsidiaries, (ii) any partnership of which such Person is a general partner or
of which more than 50% of the partnership interests is at the time directly or
indirectly owned by such Person or one or more of such Person’s Subsidiaries,
(iii) any limited liability company of which such Person is a member or of which
more than 50% of the limited liability company interests is at the time directly
or indirectly owned by such Person or one or more of such Person’s Subsidiaries
or (iv) any corporation, trust, partnership, limited liability company or other
entity which is controlled by such Person or one or more of such Person’s
Subsidiaries.

 

Subsidiary Shares shall have the meaning assigned to that term in Section 6.1.3.

 

Super-Majority Lenders shall mean, at any time, Lenders having Revolving
Exposures, Tranche B LC Exposure, unused Revolving Credit Commitments and Excess
Tranche B Credit-Linked Deposits representing more than 75% of the sum of the
total Revolving Exposures, outstanding Tranche B LCC Exposure, unused Revolving
Credit Commitments and Excess Tranche B Credit-Linked Deposits at such time.

 

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

 

Swap Transaction shall mean any transaction pursuant to any Swap Agreement.

 

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Swing Loan Commitment shall mean PNC Bank’s commitment to make Swing Loans to
the Borrower pursuant to Section 2.1.2 hereof in an aggregate principal amount
up to $25,000,000.

 

Swing Loan Note shall mean the Swing Loan Note of the Borrower in the form of
Exhibit 1.1(S)(2) evidencing the Swing Loans, together with all amendments,
extensions, renewals, replacements, refinancings or refundings thereof in whole
or in part.

 

Swing Loan Request shall mean a request for Swing Loans made in accordance with
Section 2.5.2 hereof.

 

Swing Loans shall mean collectively and Swing Loan shall mean separately all
Swing Loans or any Swing Loan made by PNC Bank to the Borrower pursuant to
Section 2.1.2 hereof.

 

Swingline Exposure shall mean, at any time, the aggregate principal amount of
all Swing Loans outstanding at such time. The Swingline Exposure of any
Revolving Lender at any time shall be its Ratable Share of the total Swingline
Exposure at such time.

 

Tranche B Availability Period shall mean the period from and including the
Closing Date to but excluding the earlier of the Tranche B Maturity Date and the
date on which all of the Tranche B Credit-Linked Deposits are returned to the
Tranche B Lenders.

 

Tranche B Certificate of Deposit shall have the meaning ascribed to such term in
Section 3.4(b) herein.

 

Tranche B Credit-Linked Deposit shall mean, as to each Tranche B Lender, the
cash deposit made by such Lender pursuant to Section 2.9: (w) as such deposit
may be reduced from time to time pursuant to Section 2.9.3.3(ii) or Section 3.2
paragraph (a), (x) as such deposit may be reduced or increased from time to time
pursuant to assignments by or to such Lender pursuant to Section 11.11, (y) as
such deposit may be increased from time to time pursuant to Section 2.9.3.3(ii),
and (z) evidenced by a book-entries maintained by the Paying Agent in accordance
with Section 3.3, in favor of those Lenders listed on Schedule 1.1(B) as the
same may be assigned from time to time subject to the provisions of Section
11.11. The amount of each Tranche B Lender’s Tranche B Credit-Linked Deposit on
the Closing Date is set forth on Schedule 1.1(B), or in the Assignment and
Assumption Agreement pursuant to which such Tranche B Lender shall have acquired
its Tranche B Credit-Linked Deposit, as applicable. Notwithstanding anything in
this Agreement to the contrary, the total Tranche B Credit-Linked Deposits shall
not exceed an aggregate amount of $200,000,000 at any given time.

 

Tranche B Credit-Linked Deposit Account shall mean the account established by
the Paying Agent under its sole and exclusive control maintained at the office
of PNC Bank, National Association, One PNC Plaza, 249 Fifth Avenue, Pittsburgh,
PA 15222, designated as the “Tranche B Credit-Linked Deposit Account” that shall
be used solely to hold the Tranche B Credit-Linked Deposits.

 

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Tranche B LC Disbursement shall mean any payment made by the Issuing Bank
pursuant to a Tranche B Letter of Credit.

 

Tranche B LC Exposure shall mean, at any time, the sum of (a) the aggregate
undrawn amount of all outstanding Tranche B Letters of Credit at such time plus
(b) the aggregate amount of all Tranche B LC Disbursements that have not yet
been reimbursed by or on behalf of the Borrower at such time. The Tranche B LC
Exposure of any Tranche B Lender at any time shall be its Ratable Share of the
total Tranche B LC Exposure at such time.

 

Tranche B Lender shall mean a Lender having a Tranche B Credit-Linked Deposit
and, to the extent that such Tranche B Credit-Linked Deposit has been applied by
the Paying Agent to reimburse the Issuing Bank for any Tranche B LC
Disbursement, a claim against the Borrower for a return of the Tranche B
Credit-Linked Deposit so applied.

 

Tranche B Letters of Credit shall mean, at any time, Letters of Credit in an
amount equal to the lesser of (i) the total Tranche B Credit-Linked Deposits and
(ii) the aggregate amount of outstanding Letters of Credit at such time. Letters
of Credit will from time to time be deemed to be Tranche B Letters of Credit or
Revolving Letters of Credit in accordance with the provisions of Section
2.9.1.2.

 

Tranche B Letter of Credit Fees shall have the meaning assigned to that term in
Section 2.9.2.2

 

Tranche B Maturity Date shall mean June 30, 2010.

 

Tranche B Ratable Share shall mean the portion of the total Tranche B
Credit-Linked Deposits represented by such Lender’s Tranche B Credit-Linked
Deposit.

 

Transferor Lender shall mean the selling Lender pursuant to an Assignment and
Assumption Agreement.

 

Triggering Event shall mean the occurrence of (i) any Event of Default pursuant
to Section 9.1.1(a) which is not cured on the next Business Day immediately
following its occurrence, (ii) any Event of Default under Section 9.1.1(b),
(iii) any Event of Default under Sections 9.1.15 or 9.1.16, (iv) any other Event
of Default which the Paying Agent, at the direction of the Required Lenders,
deems a “Triggering Event”, as notified to the Borrower and the Lenders, (v) the
acceleration of the maturity or due date of the Obligations under Section 9.2.1,
or (vi) the Revolving Expiration Date.

 

UCC Collateral shall mean the property of the Loan Parties in which security
interests are granted under the Security Agreement.

 

Uniform Commercial Code shall have the meaning assigned to that term in Section
6.1.16.

 

United States or U.S. shall mean the United States of America.

 

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USA Patriot Act shall mean the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001,
Public Law 107-56, as the same has been, or shall hereafter be, renewed,
extended, amended or replaced.

 

1.2 Construction.

 

Unless the context of this Agreement otherwise clearly requires, the following
rules of construction shall apply to this Agreement and each of the other Loan
Documents:

 

1.2.1 Number; Inclusion.

 

references to the plural include the singular, the plural, the part and the
whole; “or” has the inclusive meaning represented by the phrase “and/or,” and
“including” has the meaning represented by the phrase “including without
limitation”;

 

1.2.2 Determination.

 

references to “determination” of or by the Paying Agent, any Co-Administrative
Agent or the Lenders shall be deemed to include good-faith estimates by the
Paying Agent, each Co-Administrative Agent or the Lenders (in the case of
quantitative determinations) and good-faith beliefs by the Paying Agent or the
Lenders (in the case of qualitative determinations) and such determination shall
be conclusive absent manifest error;

 

1.2.3 Paying Agent’s Discretion and Consent.

 

whenever the Paying Agent, the Co-Administrative Agents or the Lenders are
granted the right herein to act in its or their sole discretion or to grant or
withhold consent such right shall be exercised in good faith;

 

1.2.4 Documents Taken as a Whole.

 

the words “hereof,” “herein,” “hereunder,” “hereto” and similar terms in this
Agreement or any other Loan Document refer to this Agreement or such other Loan
Document as a whole and not to any particular provision of this Agreement or
such other Loan Document;

 

1.2.5 Headings.

 

the section and other headings contained in this Agreement or such other Loan
Document and the Table of Contents (if any), preceding this Agreement or such
other Loan Document are for reference purposes only and shall not control or
affect the construction of this Agreement or such other Loan Document or the
interpretation thereof in any respect;

 

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1.2.6 Implied References to this Agreement.

 

article, section, subsection, clause, schedule and exhibit references are to
this Agreement or other Loan Document, as the case may be, unless otherwise
specified;

 

1.2.7 Persons.

 

reference to any Person includes such Person’s successors and assigns but, if
applicable, only if such successors and assigns are permitted by this Agreement
or such other Loan Document, as the case may be, and reference to a Person in a
particular capacity excludes such Person in any other capacity;

 

1.2.8 Modifications to Documents.

 

reference to any agreement (including this Agreement and any other Loan Document
together with the schedules and exhibits hereto or thereto), document or
instrument means such agreement, document or instrument as amended, modified,
replaced, substituted for, superseded or restated;

 

1.2.9 From, To and Through.

 

relative to the determination of any period of time, “from” means “from and
including,” “to” means “to but excluding,” and “through” means “through and
including”; and

 

1.2.10 Shall; Will.

 

references to “shall” and “will” are intended to have the same meaning.

 

1.3 Accounting Principles.

 

Except as otherwise provided in this Agreement, all computations and
determinations as to accounting or financial matters and all financial
statements to be delivered pursuant to this Agreement shall be made and prepared
in accordance with GAAP (including principles of consolidation where
appropriate), and all accounting or financial terms shall have the meanings
ascribed to such terms by GAAP; provided, however, that all accounting terms
used in Section 8.2 [Negative Covenants] (and all defined terms used in the
definition of any accounting term used in Section 8.2 shall have the meaning
given to such terms (and defined terms) under GAAP as in effect on the date
hereof applied on a basis consistent with those used in preparing the Annual
Statements referred to in Section 6.1.9((i)) [Historical Statements]. In the
event of any change after the date hereof in GAAP, and if such change would
result in the inability to determine compliance with the financial covenants set
forth in Section 8.2 based upon the Borrower’s regularly prepared financial
statements by reason of the preceding sentence, then the parties hereto agree to
endeavor, in good faith, to agree upon an amendment to this Agreement that would
adjust such financial covenants in a manner that would not affect the substance
thereof, but would allow compliance therewith to be determined in accordance
with the Borrower’s financial statements at that time.

 

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2. REVOLVING CREDIT AND SWING LOAN FACILITIES

 

2.1 Revolving Credit Commitments.

 

2.1.1 Revolving Credit Loans.

 

Subject to the terms and conditions hereof and relying upon the representations
and warranties herein set forth, each Revolving Lender severally agrees to make
Revolving Credit Loans to the Borrower at any time or from time to time on or
after the date hereof to the Revolving Expiration Date provided that after
giving effect to such Revolving Credit Loan the aggregate amount of Revolving
Credit Loans from such Revolving Lender shall not exceed such Lender’s Revolving
Credit Commitment minus such Lender’s Revolving Credit Ratable Share of the
Revolving LC Exposure and provided further that the Revolving Exposures at any
time shall not exceed the Revolving Credit Commitments of all of the Revolving
Lenders. Within such limits of time and amount and subject to the other
provisions of this Agreement, the Borrower may borrow, repay and reborrow
pursuant to this Section 2.1.1.

 

2.1.2 Swing Loan Commitment.

 

In order to minimize the transfer of funds between the Revolving Lenders and the
Paying Agent, the Borrower may borrow, repay and reborrow Swing Loans and PNC
Bank may make Swing Loans as provided in this Section 2.1.2 [Swing Loan
Commitment]. Subject to the terms and conditions hereof and relying upon the
representations and warranties herein set forth, and in order to facilitate
loans and repayments between Settlement Dates, PNC Bank may, at its option,
cancelable at any time for any reason whatsoever, make swing loans (the “Swing
Loans”) to the Borrower at any time or from time to time after the date hereof
to, but not including, the Revolving Expiration Date, in an aggregate principal
amount up to but not in excess of $25,000,000 (the “Swing Loan Commitment”),
provided that the Revolving Exposures shall not at any time exceed the Revolving
Credit Commitments. Within such limits of time and amount and subject to the
other provisions of this Agreement, the Borrower may borrow, repay and reborrow
pursuant to this Section 2.1.2.

 

2.2 Nature of Revolving Lenders’ Obligations with Respect to Revolving Credit
Loans.

 

Each Revolving Lender shall be obligated to participate in each request for
Revolving Credit Loans pursuant to Section 2.5.1 [Revolving Credit Loan
Requests] in accordance with its Revolving Credit Ratable Share. The aggregate
of each Revolving Lender’s Revolving Credit Loans outstanding hereunder to the
Borrower at any time shall never exceed its Revolving Credit Commitment minus
its Revolving Credit Ratable Share of the Revolving LC Exposure. The obligations
of each Revolving Lender hereunder are several. The failure of any Revolving
Lender to perform its obligations hereunder shall not affect the Obligations of
the Borrower to any other party nor shall any other party be liable for the
failure of such Revolving Lender to perform its obligations hereunder. The
Revolving Lenders shall have no obligation to make Revolving Credit Loans
hereunder on or after the Revolving Expiration Date.

 

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2.3 Commitment Fees.

 

Accruing from the date hereof until the Revolving Expiration Date, the Borrower
agrees to pay to the Paying Agent for the account of each Revolving Lender
providing a Revolving Credit Commitment hereunder, a nonrefundable commitment
fee (the “Commitment Fee”) equal to the fee specified below (computed on the
basis of a year of 365 or 366 days, as the case may be, and actual days elapsed)
on the average daily difference between the amount of (a) such Revolving
Lender’s Revolving Credit Commitment as the same may be constituted from time to
time (for purposes of this computation, PNC Bank’s Swing Loans shall not be
deemed to be borrowed amounts under its Revolving Credit Commitment) and (b)
such Revolving Lender’s Revolving Exposure:

 

(i) 0.75% per annum for any period when the Revolving Exposures are less than
fifty percent (50%) of the aggregate Revolving Credit Commitments; and

 

(ii) 0.50% per annum for any period when Revolving Exposures are equal to or
greater than fifty percent (50%) of the aggregate Revolving Credit Commitments.

 

All Commitment Fees shall be payable in arrears on the first Business Day of
each March, June, September and December after the date hereof and on the
Revolving Expiration Date or upon acceleration of the Notes.

 

2.4 Voluntary Reduction of Revolving Credit Commitments.

 

The Borrower shall have the right any time and from time to time upon three (3)
Business Days’ prior written, irrevocable notice to the Paying Agent to
permanently reduce, in whole multiples of $5,000,000 of principal, or terminate
the Revolving Credit Commitments provided that any such reduction or termination
shall be accompanied by (a) the payment in full of any Commitment Fee then
accrued on the amount of such reduction or termination and (b) prepaying of the
Revolving Credit Notes, together with the full amount of interest accrued on the
principal sum to be prepaid (and all amounts referred to in Section 5.6
[Additional Compensation in Certain Circumstances] hereof), to the extent that
the aggregate amount thereof then outstanding exceeds the Revolving Credit
Commitment as so reduced or terminated, and provided further that the Revolving
Credit Commitments may not be reduced below the Revolving Exposures. Each
reduction of Revolving Credit Commitments shall pro-ratably reduce the Revolving
Credit Commitments of the Revolving Lenders. From the effective date of any such
reduction or termination the obligations of Borrower to pay the Commitment Fee
pursuant to Section 2.3 [Commitment Fees] shall correspondingly be reduced or
cease.

 

2.5 Revolving Credit Loan Requests; Swing Loan Requests.

 

2.5.1 Revolving Credit Loan Requests.

 

Except as otherwise provided herein, the Borrower may from time to time prior to
the Revolving Expiration Date request the Revolving Lenders to make Revolving
Credit Loans, or renew or convert the Interest Rate Option applicable to
existing Revolving Credit Loans pursuant to Section 4.2 [Interest Periods], by
delivering to the Paying Agent, no later than

 

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(i) 11:00 a.m., Pittsburgh time, three (3) Business Days prior to: (A) the
proposed Borrowing Date with respect to the making of Revolving Credit Loans or
the renewal of Revolving Credit Loans to which the Euro-Rate Option applies or
(B) the date of the conversion to the Euro-Rate Option for any Revolving Credit
Loans; and (ii) 10:00 a.m., Pittsburgh time, on either the proposed Borrowing
Date with respect to the making of a Revolving Credit Loan to which the Base
Rate Option applies or the last day of the preceding Interest Period with
respect to the conversion to the Base Rate Option for any Loan, of a duly
completed request therefor substantially in the form of Exhibit 2.5.1 or a
request by telephone immediately confirmed in writing by letter, facsimile or
telex in such form (each, a “Loan Request”), it being understood that the Paying
Agent may rely on the authority of any individual making such a telephonic
request without the necessity of receipt of such written confirmation. Each Loan
Request shall be irrevocable and shall specify or certify, as applicable (i) the
proposed Borrowing Date or the proposed interest conversion date; (ii) the
aggregate amount of the proposed Loans comprising each Borrowing Tranche, which
shall be in integral multiples of $1,000,000 and not less than $5,000,000 for
each Borrowing Tranche to which the Euro-Rate Option applies and not less than
the lesser of $500,000 or the maximum amount available for Borrowing Tranches to
which the Base Rate Option applies; (iii) whether the Euro-Rate Option or Base
Rate Option shall apply to the proposed Loans comprising the applicable
Borrowing Tranche; and (iv) in the case of a Borrowing Tranche to which the
Euro-Rate Option applies, an appropriate Interest Period for the Loans
comprising such Borrowing Tranche.

 

2.5.2 Swing Loan Requests.

 

Except as otherwise provided herein, the Borrower may from time to time prior to
the Revolving Expiration Date request PNC Bank to make Swing Loans by delivery
to PNC Bank not later than 1:00 p.m., Pittsburgh time, on the proposed Borrowing
Date of a duly completed request therefor substantially in the form of Exhibit
2.5.2 hereto or a request by telephone immediately confirmed in writing by
letter, facsimile or telex (each, a “Swing Loan Request”), it being understood
that PNC Bank may rely on the authority of any individual making such a
telephonic request without the necessity of receipt of such written
confirmation. Each Swing Loan Request shall be irrevocable and shall specify the
proposed Borrowing Date and the principal amount of such Swing Loan, which shall
be in integral multiples of $50,000 and shall be not less than $100,000.

 

2.6 Making Revolving Credit Loans and Swing Loans.

 

2.6.1 Making Revolving Credit Loans

 

The Paying Agent shall, promptly after receipt by it of a Loan Request pursuant
to Section 2.5.1 [Revolving Credit Loan Requests], notify the Revolving Lenders
having a Revolving Credit Commitment of its receipt of such Loan Request
specifying: (i) the proposed Borrowing Date and the time and method of
disbursement of the Revolving Credit Loans requested thereby; (ii) the amount
and type of each such Revolving Credit Loan and the applicable Interest Period
(if any); and (iii) the apportionment among the Revolving Lenders of such
Revolving Credit Loans as determined by the Paying Agent in accordance with
Section 2.2 [Nature of Revolving Lenders’ Obligations]. Each Revolving Lender
shall remit the principal

 

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amount of each Revolving Credit Loan to the Paying Agent such that the Paying
Agent is able to, and the Paying Agent shall, to the extent the Revolving
Lenders have made funds available to it for such purpose and subject to Section
7.2 [Each Additional Loan or Letter of Credit], fund such Revolving Credit Loans
to the Borrower in U.S. Dollars and immediately available funds at the Principal
Office prior to 2:00 p.m., Pittsburgh time, on the applicable Borrowing Date,
provided that if any Revolving Lender fails to remit such funds to the Paying
Agent in a timely manner, the Paying Agent may elect in its sole discretion to
fund with its own funds the Revolving Credit Loans of such Revolving Lender on
such Borrowing Date, and such Revolving Lender shall be subject to the repayment
obligation in Section 10.16 [Availability of Funds].

 

2.6.2 Making Swing Loans.

 

So long as PNC Bank elects to make Swing Loans, PNC Bank shall, after receipt by
it of a Swing Loan Request pursuant to Section 2.5.2 [Swing Loan Requests], fund
such Swing Loan to the Borrower in U.S. Dollars and immediately available funds
at the Principal Office prior to 2:00 p.m., Pittsburgh time, on the Borrowing
Date.

 

2.7 Revolving Credit Notes and Swing Loan Note.

 

2.7.1 Revolving Credit Note.

 

The obligation of the Borrower to repay the aggregate unpaid principal amount of
the Revolving Credit Loans made to it by each Revolving Lender, together with
interest thereon, shall be evidenced by a Revolving Credit Note dated the
Closing Date payable to the order of such Revolving Lender in a face amount
equal to the Revolving Credit Commitment of such Revolving Lender. The Revolving
Credit Loans shall mature, and the Borrower unconditionally agrees to pay in
full the unpaid principal amount and all amounts outstanding and unpaid in
respect of the Revolving Credit Loans to the Paying Agent for the account of
each Revolving Lender on the Revolving Expiration Date.

 

2.7.2 Swing Loan Note.

 

The obligation of the Borrower to repay the unpaid principal amount of the Swing
Loans made to it by PNC Bank together with interest thereon shall be evidenced
by a demand promissory note of the Borrower dated the Closing Date in
substantially the form attached hereto as Exhibit 1.1(S)(2) payable to the order
of PNC Bank in a face amount equal to the Swing Loan Commitment.

 

2.8 Use of Proceeds.

 

The proceeds of the Revolving Credit Loans shall be used for general corporate
purposes of the Loan Parties, including, without limitation, Permitted
Acquisitions and working capital and capital expenditures of the Loan Parties
and in accordance with Section 8.1.10 [Use of Proceeds].

 

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2.9 Letter of Credit Subfacility.

 

2.9.1 Issuance of Letters of Credit.

 

2.9.1.1 On the Closing Date, the outstanding Letters of Credit previously issued
by PNC Bank as an “Issuing Bank” under the Existing Credit Agreement and the
Designated Letter of Credit Facility which are set forth on Schedule 2.9.1 (the
“Existing Letters of Credit”) will automatically, without any action on the part
of any Person, be deemed to be Letters of Credit issued hereunder for the
account of the Borrower for all purposes of this Agreement and the other Loan
Documents. In addition, subject to the terms and conditions of this Agreement,
Borrower may request the issuance of a letter of credit (each a “Letter of
Credit”) on behalf of itself or another Loan Party by delivering or having such
other Loan Party deliver to the Issuing Bank a completed application and
agreement for letters of credit in such form as the Issuing Bank may specify
from time to time by no later than 11:00 a.m., Pittsburgh time, at least three
(3) Business Days, or such shorter period as may be agreed to by the Issuing
Bank, in advance of the proposed date of issuance. The Borrower shall be a
co-applicant and a co-obligor with respect to each Letter of Credit issued for
the account of any other Loan Party, in which case each of the co-applicants and
co-obligors will have joint and several liability with respect to any such
Letter of Credit. Letters of Credit may be issued in the form of a Standby
Letter of Credit or a Commercial Letter of Credit.

 

2.9.1.2 The Borrower may make a request for the issuance of Letters of Credit of
either (i) a Tranche B Letter of Credit, at any time and from time to time
during the Tranche B Availability Period or (ii) a Revolving Letter of Credit,
at any time and from time to time during the Revolving Availability Period.
Subject to the terms and conditions hereof and in reliance on the agreements of
the other Lenders set forth in this Section 2.9 (and with respect to issuances
of Tranche B Letters of Credit, Section 3.1 [Tranche B Credit-Linked Deposit
Account]), the Issuing Bank or any of the Issuing Bank’s Affiliates will issue,
amend, extend or renew a Letter of Credit provided that after giving effect to
such issuance, amendment, extension or renewal:

 

(i) each Letter of Credit shall expire at or prior to the close of business on
the earlier of (A) the date twenty-four (24) months from the date of issuance,
and (B) (x) with respect to any Revolving Letter of Credit, the date that is ten
(10) Business Days prior to the Revolving Expiration Date and (y) with respect
to any Tranche B Letter of Credit, the date that is ten (10) Business Days prior
to the Tranche B Maturity Date;

 

(ii) the LC Exposure shall not exceed the sum of the total Revolving Credit
Commitments (which, as of the Closing Date, is $400,000,000) and the total
Tranche B Credit-Linked Deposits (which, as of the Closing Date, is
$200,000,000);

 

(iii) the total Revolving Exposures shall not exceed the total Revolving Credit
Commitments; and

 

(iv) the Tranche B LC Exposure shall not exceed the total Tranche B
Credit-Linked Deposits;

 

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For purposes hereof, (i) Letters of Credit shall at all times and from time to
time be deemed to be Tranche B Letters of Credit in the amount specified in the
definition of Tranche B Letters of Credit and be deemed to be Revolving Letters
of Credit only to the extent, and in an amount by which, the aggregate amount of
outstanding Letters of Credit exceeds such amount specified in the definition of
Tranche B Letters of Credit, (ii) drawings under any Letter of Credit shall be
deemed to have been made under Revolving Letters of Credit for so long as, and
to the extent that, there are any undrawn Revolving Letters of Credit
outstanding (and thereafter shall be deemed to have been made under Tranche B
Letters of Credit) and (iii) any Letter of Credit that expires or terminates
will be deemed to be a Revolving Letter of Credit, for so long as, and to the
extent that, there are outstanding Revolving Letters of Credit immediately prior
to such expiration or termination. To the extent necessary to implement the
foregoing, the identification of a Letter of Credit as a Revolving Letter of
Credit or a Tranche B Letter of Credit may change from time to time and a
portion of a Letter of Credit may be deemed to be a Tranche B Letter of Credit
and the remainder be deemed to be a Revolving Letter of Credit. In the event of
any inconsistency between the terms and conditions of this Agreement and the
terms and conditions of any form of letter of credit application or other
agreement submitted by the Borrower to, or entered into by the Borrower with,
the Issuing Bank relating to any Letter of Credit, the terms and conditions of
this Agreement shall control.

 

2.9.2 Letter of Credit Fees.

 

2.9.2.1 Revolving Letter of Credit Fees. With respect to each Revolving Letter
of Credit, the Borrower shall pay to the Paying Agent for the ratable account
(determined based upon Revolving Credit Ratable Share) of the Revolving Lenders
a fee (the “Revolving Letter of Credit Fee”) equal to the Applicable Revolving
Letter of Credit Fee Rate, per annum, then in effect (computed on the basis of a
year of 360 days and actual days elapsed) on the daily undrawn amount of the
Revolving Letters of Credit, payable quarterly in arrears commencing with the
first Business Day of each March, June, September and December following
issuance of each Revolving Letter of Credit and on the Revolving Expiration
Date.

 

2.9.2.2 Tranche B Letter of Credit Fees. The Borrower shall pay, to the Paying
Agent for the ratable account (determined based upon Tranche B Ratable Share) of
the Tranche B Lenders, the following fees (the “Tranche B Letter of Credit
Fees”) on the aggregate amount of Tranche B Credit-Linked Deposits:

 

(i) 0.25% per annum; plus

 

(ii) the Applicable Tranche B Letter of Credit Fee Rate from time to time in
effect.

 

(iii) The Tranche B Letter of Credit Fees shall accrue during the period from
and including the Closing Date to but excluding the date on which the entire
amount of such Lender’s Tranche B Credit-Linked Deposit is returned to it. The
Tranche B Letter of Credit Fees shall be computed on the basis of a year of 360
days and actual days elapsed and be payable quarterly in arrears commencing with
the first Business Day of each March, June, September and December and on the
Tranche B Maturity Date.

 

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2.9.2.3 Fronting Fees. In addition with respect to each Revolving Letter of
Credit, the Borrower shall pay to the Issuing Bank for its own account a
fronting fee equal to 0.15% per annum (computed on the basis of a year of 360
days and actual days elapsed), which fees shall be computed on the daily average
undrawn amount of Revolving Letters of Credit outstanding and shall be payable
quarterly in arrears commencing with the first Business Day of each March, June,
September and December subsequent to the Closing Date and on the Revolving
Expiration Date.

 

2.9.2.4 Customary Fees and Expenses. The Borrower shall also pay to the Paying
Agent for the Issuing Bank’s sole account the Issuing Bank’s then in effect
customary fees and administrative expenses payable with respect to the Letters
of Credit as the Issuing Bank may generally charge or incur from time to time in
connection with the issuance, maintenance, extension, renewal, amendment,
modification (if any), assignment or transfer (if any), negotiation, and
administration of Letters of Credit. For each Commercial Letter of Credit, the
Borrower shall pay to the Issuing Bank for its own account, a negotiation fee of
0.25% of each draw on the Letter of Credit, payable at the time of the drawing.

 

2.9.3 Participations, Disbursements, Reimbursement.

 

2.9.3.1 Immediately upon the issuance of each Revolving Letter of Credit, each
Revolving Lender shall be deemed to, and hereby irrevocably and unconditionally
agrees to, purchase from the Issuing Bank a participation in such Revolving
Letter of Credit (including the Existing Letters of Credit) and each drawing
thereunder in an amount equal to such Lender’s Revolving Credit Ratable Share of
the maximum amount available to be drawn under such Revolving Letter of Credit
and the amount of such drawing, respectively.

 

2.9.3.2 Immediately upon the issuance of each Tranche B Letter of Credit, each
Tranche B Lender shall be deemed to, and hereby irrevocably and unconditionally
agrees to, purchase from the Issuing Bank a participation in such Tranche B
Letter of Credit (including the Existing Letters of Credit) and each drawing
thereunder in an amount equal to such Lender’s Tranche B Credit Ratable Share of
the maximum amount available to be drawn under such Tranche B Letter of Credit
and the amount of such drawing, respectively. On the Closing Date, without any
further action on the part of the Issuing Bank or the Tranche B Lenders, the
Issuing Bank hereby grants to each Tranche B Lender, and each Tranche B Lender
hereby acquires from the Issuing Bank, a participation in each Existing Letter
of Credit equal to such Tranche B Lender’s Ratable Share of the aggregate amount
available to be drawn under such Existing Letters of Credit. Each Tranche B
Lender hereby absolutely and unconditionally agrees that if the Issuing Bank
makes a Tranche B LC Disbursement which is not reimbursed by the Borrower on the
date and time due as provided in paragraph 2.9.3.3 of this Section, or is
required to refund any reimbursement payment in respect of a Tranche B LC
Disbursement to the Borrower (or any other Loan Party) for any reason, the
Paying Agent shall reimburse the Issuing Bank for the amount of such Tranche B
LC Disbursement from such Tranche B Lender’s Tranche B Credit-Linked Deposit on
deposit in the Tranche B Credit-Linked Deposit Account. In the event the Tranche
B Credit-Linked Deposit Account is charged by the Paying Agent to reimburse the
Issuing Bank for an unreimbursed Tranche B LC Disbursement, the Borrower, in
consideration of each Tranche B Lender having funded its respective Tranche B
Credit-Linked Deposit Account,

 

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shall have the obligation to pay over to the Paying Agent in reimbursement
thereof an amount equal to the amount so charged, and such payment shall be
deposited by the Paying Agent in the Tranche B Credit-Linked Deposit Account.
The obligation of the Borrower to make such payments shall be an Obligation
hereunder and shall be secured by the Collateral, and the Tranche B Lenders
shall have all of the benefits of the Loan Documents with respect thereto. Each
Tranche B Lender acknowledges and agrees that its obligation to acquire and fund
participations in respect of Tranche B Letters of Credit pursuant to this
subparagraph 2.9.3.2 is unconditional and irrevocable and shall not be affected
by any circumstance whatsoever, including any amendment, renewal or extension of
any Tranche B Letter of Credit or the occurrence and continuance of a Potential
Default or Event of Default or the return of the Tranche B Credit Linked
Deposits, and that each such payment shall be made without any offset,
abatement, withholding or reduction whatsoever. Without limiting the foregoing,
each Tranche B Lender irrevocably authorizes the Paying Agent to apply amounts
of its Tranche B Credit-Linked Deposit as provided in this subparagraph 2.9.3.2.

 

2.9.3.3 The Borrower shall reimburse the Issuing Bank on each date that an
amount is paid by the Issuing Bank under any Letter of Credit (each such date, a
“Drawing Date”) in an amount equal to the amount so paid by the Issuing Bank
(such obligation to reimburse the Issuing Bank shall sometimes be referred to as
a “Reimbursement Obligation”). In the event of any request for a drawing under a
Letter of Credit by the beneficiary or transferee thereof, the Paying Agent will
promptly notify the Borrower, provided that any failure of the Paying Agent to
promptly notify the Borrower shall not release the Borrower from its
Reimbursement Obligation. Each Reimbursement Obligation should be received by
the Issuing Bank prior to 12:00 noon, Pittsburgh time, on the Drawing Date,
unless the Paying Agent fails to provide the Borrower with notice of a Drawing
prior to such time (in which case, the Reimbursement Obligation shall be paid
promptly upon notice from the Paying Agent). In the event the Borrower (or any
other account party) fails to reimburse the Issuing Bank for the full amount of
any drawing under any Letter of Credit by 12:00 noon, Pittsburgh time, on the
Drawing Date:

 

(i) if the failure to reimburse relates to a Revolving Letter of Credit, the
Issuing Bank will promptly notify each Revolving Lender of the applicable
Revolving LC Disbursement, the payment then due from the Borrower in respect
thereof and such Revolving Lender’s Ratable Share thereof. The Borrower shall be
deemed to have requested that Revolving Credit Loans be made by the Revolving
Lenders under the Base Rate Option to be disbursed on the Drawing Date with
respect to such Revolving Letter of Credit, subject to the conditions set forth
in Section 7.2 [Each Additional Loan or Letter of Credit] other than any notice
requirements. Any notice given by the Paying Agent pursuant to this Section
2.9.3.3 may be oral if immediately confirmed in writing; provided that the lack
of such an immediate confirmation shall not affect the conclusiveness or binding
effect of such notice. Each Revolving Lender shall upon any notice pursuant to
this Section 2.9.3.3 make available to the Paying Agent an amount in immediately
available funds equal to its Revolving Credit Ratable Share of the amount of the
drawing, whereupon the participating Revolving Lenders shall (subject to Section
2.9.3.3(iii)) each be deemed to have made a Revolving Credit Loan under the Base
Rate Option to the Borrower in that amount. If any Revolving Lender so notified

 

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fails to make available to the Paying Agent for the account of the Paying Agent
the amount of such Revolving Lender’s Revolving Credit Ratable Share of such
amount by no later than 2:00 p.m., Pittsburgh time, on the Drawing Date, then
interest shall accrue on such Revolving Lender’s obligation to make such
payment, from the Drawing Date to the date on which such Revolving Lender makes
such payment (i) at a rate per annum equal to the Federal Funds Effective Rate
during the first three days following the Drawing Date and (ii) at a rate per
annum equal to the rate applicable to Loans under the Base Rate Option on and
after the fourth day following the Drawing Date. The Paying Agent will promptly
give notice of the occurrence of the Drawing Date, but failure of the Paying
Agent to give any such notice on the Drawing Date or in sufficient time to
enable any Revolving Lender to effect such payment on such date shall not
relieve such Revolving Lender from its obligation under this subparagraph (i).

 

(ii) if the failure to reimburse relates to a Tranche B Letter of Credit, the
Paying Agent shall notify each Tranche B Lender of the applicable Tranche B LC
Disbursement, the payment then due from the Borrower in respect thereof and such
Lender’s Ratable Share thereof, and the Paying Agent shall promptly pay to the
Issuing Bank each Tranche B Lender’s Ratable Share of such Tranche B LC
Disbursement from such Tranche B Lender’s Tranche B Credit-Linked Deposit.
Promptly following receipt by the Paying Agent of any payment by the Borrower in
respect of any Tranche B LC Disbursement, the Paying Agent shall distribute such
payment to the Issuing Bank or, to the extent payments have been made from the
Tranche B Credit-Linked Deposits, to the Tranche B Credit-Linked Deposit Account
to be added to the Tranche B Credit-Linked Deposits of the Tranche B Lenders in
accordance with their Ratable Shares. Any payment made from the Tranche B
Credit-Linked Deposit Account, pursuant to this paragraph, to reimburse the
Issuing Bank for any Tranche B LC Disbursement shall not constitute a Loan and
shall not relieve the Borrower of its obligation to reimburse the Tranche B
Lenders for the application by the Paying Agent of the Tranche B Credit-Linked
Deposits to pay such LC Disbursement.

 

(iii) with respect to any unreimbursed drawing under a Revolving Letter of
Credit that is not converted into Revolving Credit Loans under the Base Rate
Option to the Borrower in whole or in part as contemplated by Section
2.9.3.3(i), because of the Borrower’s failure to satisfy the conditions set
forth in Section 7.2 [Each Additional Loan or Letter of Credit] other than any
notice requirements or for any other reason, the Borrower shall be deemed to
have incurred from the Paying Agent a borrowing (each a “Revolving Letter of
Credit Borrowing”) in the amount of such drawing. Such Revolving Letter of
Credit Borrowing shall be due and payable on demand (together with interest) and
shall bear interest at the rate per annum applicable to the Revolving Credit
Loans under the Base Rate Option. Each Revolving Lender’s payment to the Paying
Agent pursuant to this Section 2.9.3.3 shall be deemed to be a payment in
respect of its participation in such Revolving Letter of Credit Borrowing and
shall constitute a “Revolving Participation Advance” from such Revolving Lender
in satisfaction of its participation obligation under this clause (iii).

 

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2.9.3.4 If the Paying Agent applies the Tranche B Credit-Linked Deposits to
reimburse the Issuing Bank for any Tranche B LC Disbursement, the amount of
Tranche B Credit-Linked Deposits so applied shall bear interest, for each day
from and including the date such Tranche B LC Disbursement is paid from the
Tranche B Credit-Linked Deposits to, but excluding, the date that the Borrower
(or any other account party) reimburses the Paying Agent, at the default rate
per annum set forth in Section 4.3.2 [Other Obligations]. Interest accrued
pursuant to this paragraph shall be payable to the Paying Agent, on demand, for
the account of each Tranche B Lender in accordance with such Lender’s Tranche B
Ratable Share.

 

2.9.3.5 If any Event of Default shall occur and be continuing, on the Business
Day that the Borrower receives notice from the Paying Agent or the Required
Lenders (or, if the maturity of the Loans has been accelerated, Tranche B
Lenders and Revolving Lenders with LC Exposure representing greater than 50% of
the total LC Exposure) demanding the deposit of cash collateral pursuant to this
paragraph, the Borrower shall deposit in an account with the Paying Agent, in
the name of the Paying Agent and for the benefit of the Lenders, an amount in
cash equal to the LC Exposure as of such date plus any accrued and unpaid
interest thereon; provided that the obligation to deposit such cash collateral
shall become effective immediately, and such deposit shall become immediately
due and payable, without demand or other notice of any kind, upon the occurrence
of any Event of Default with respect to the Borrower described in Section 9.1.15
[Involuntary Proceedings] or Section 9.1.16 [Voluntary Proceedings]. Each such
deposit shall be held by the Paying Agent as collateral for the payment and
performance of the obligations of the Borrower under this Agreement. The Paying
Agent shall have exclusive dominion and control, including the exclusive right
of withdrawal, over such account. Such deposits shall not bear interest. Moneys
in such account shall be applied by the Paying Agent to reimburse the Issuing
Bank for LC Disbursements for which it has not been reimbursed and, to the
extent not so applied, shall be held for the satisfaction of the reimbursement
obligations of the Borrower for the LC Exposure at such time or, if the maturity
of the Loans has been accelerated (but subject to the consent of Tranche B
Lenders and Revolving Lenders with LC Exposure representing greater than 50% of
the total LC Exposure), be applied to satisfy other obligations of the Borrower
under this Agreement. If the Borrower is required to provide an amount of cash
collateral hereunder as a result of the occurrence of an Event of Default, such
amount (to the extent not applied as aforesaid) shall be returned to the
Borrower within three Business Days after all Events of Default have been cured
or waived.

 

2.9.4 Repayment of Revolving Participation Advances.

 

2.9.4.1 Upon receipt by the Paying Agent for its account of immediately
available funds from the Borrower (i) in reimbursement of any payment made by
the Paying Agent under the Revolving Letter of Credit with respect to which any
Revolving Lender has made a Revolving Participation Advance to the Paying Agent,
or (ii) in payment of interest on such a payment made by the Paying Agent under
such a Revolving Letter of Credit, the Paying Agent will pay to each Revolving
Lender, in the same funds as those received by the Paying Agent, the amount of
such Revolving Lender’s Revolving Credit Ratable Share of such funds, except the
Paying Agent shall retain the amount of the Revolving Credit Ratable Share of
such funds of any Revolving Lender that did not make a Revolving Participation
Advance in respect of such payment by Paying Agent.

 

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2.9.4.2 If the Issuing Bank or the Paying Agent is required at any time to
return to any Loan Party, or to a trustee, receiver, liquidator, custodian, or
any official in any Insolvency Proceeding, any portion of the payments made by
any Loan Party to the Paying Agent pursuant to Section 2.9.4.1 in reimbursement
of a payment made under the Letter of Credit or interest or fee thereon, each
Revolving Lender shall, on demand of the Paying Agent, forthwith return to the
Paying Agent the amount of its Revolving Credit Ratable Share of any amounts so
returned by the Paying Agent plus interest thereon from the date such demand is
made to the date such amounts are returned by such Revolving Lender to the
Paying Agent, at a rate per annum equal to the Federal Funds Effective Rate in
effect from time to time.

 

2.9.5 Documentation.

 

Each Loan Party agrees to be bound by the terms of the Issuing Bank’s
application and agreement for letters of credit and the Issuing Bank’s written
regulations and customary practices relating to letters of credit, though such
interpretation may be different from such Loan Party’s own. In the event of a
conflict between such application or agreement and this Agreement, this
Agreement shall govern. It is understood and agreed that, except in the case of
gross negligence or willful misconduct, the Issuing Bank shall not be liable for
any error, negligence and/or mistakes, whether of omission or commission, in
following any Loan Party’s instructions or those contained in the Letters of
Credit or any modifications, amendments or supplements thereto.

 

2.9.6 Determinations to Honor Drawing Requests.

 

In determining whether to honor any request for drawing under any Letter of
Credit by the beneficiary thereof, the Issuing Bank shall be responsible only to
determine that the documents and certificates required to be delivered under
such Letter of Credit have been delivered and that they comply on their face
with the requirements of such Letter of Credit.

 

2.9.7 Nature of Participation and Reimbursement Obligations.

 

Each Lender’s obligation in accordance with this Agreement with respect to
Letters of Credit and the Obligations of the Borrower to reimburse the Issuing
Bank upon a draw under a Letter of Credit shall be absolute, unconditional and
irrevocable, and shall be performed strictly in accordance with the terms of
this Section 2.9 under all circumstances, including the following circumstances:

 

(i) any set-off, counterclaim, recoupment, defense or other right which such
Lender may have against the Issuing Bank or any of its Affiliates, the Borrower
or any other Person for any reason whatsoever;

 

(ii) with respect to Revolving Letters of Credit, the failure of any Loan Party
or any other Person to comply, in connection with a Revolving Letter of Credit
Borrowing, with the conditions set forth in Section 2.1 [Revolving Credit
Commitments], 2.5.1 [Revolving Credit Loan Requests], 2.5.2 [Making Revolving
Credit Loans] or 7.2 [Each Additional Loan or Letter of Credit] or as otherwise
set forth in this Agreement for

 

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the making of a Revolving Credit Loan, it being acknowledged that such
conditions are not required for the making of a Letter of Credit Borrowing and
the obligation of the Lenders to make Revolving Participation Advances under
Section 2.9.3 [Disbursements, Reimbursement];

 

(iii) any lack of validity or enforceability of any Letter of Credit;

 

(iv) any claim of breach of warranty that might be made by any Loan Party or any
Lender against any beneficiary of a Letter of Credit, or the existence of any
claim, set-off, recoupment, counterclaim, crossclaim, defense or other right
which any Loan Party or any Lender may have at any time against a beneficiary,
successor beneficiary any transferee or assignee of any Letter of Credit or the
proceeds thereof (or any Persons for whom any such transferee may be acting),
the Issuing Bank or its Affiliates or any Lender or any other Person or, whether
in connection with this Agreement, the transactions contemplated herein or any
unrelated transaction (including any underlying transaction between any Loan
Party or Subsidiaries of a Loan Party and the beneficiary for which any Letter
of Credit was procured);

 

(v) the lack of power or authority of any signer of (or any defect in or forgery
of any signature or endorsement on) or the form of or lack of validity,
sufficiency, accuracy, enforceability or genuineness of any draft, demand,
instrument, certificate or other document presented under or in connection with
any Letter of Credit, or any fraud or alleged fraud in connection with any
Letter of Credit, or the transport of any property or provisions of services
relating to a Letter of Credit, in each case even if the Issuing Bank or any of
the Issuing Bank’s Affiliates has been notified thereof;

 

(vi) payment by the Issuing Bank or any of its Affiliates under any Letter of
Credit against presentation of a demand, draft or certificate or other document
which does not comply with the terms of such Letter of Credit;

 

(vii) the solvency of, or any acts of omissions by, any beneficiary of any
Letter of Credit, or any other Person having a role in any transaction or
obligation relating to a Letter of Credit, or the existence, nature, quality,
quantity, condition, value or other characteristic of any property or services
relating to a Letter of Credit;

 

(viii) any failure by the Issuing Bank or any of Issuing Bank’s Affiliates to
issue any Letter of Credit in the form requested by any Loan Party, unless the
Issuing Bank has received written notice from such Loan Party of such failure
within three Business Days after the Issuing Bank shall have furnished such Loan
Party a copy of such Letter of Credit and such error is material and no drawing
has been made thereon prior to receipt of such notice;

 

(ix) any adverse change in the business, operations, properties, assets,
condition (financial or otherwise) or prospects of any Loan Party or
Subsidiaries of a Loan Party;

 

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(x) any breach of this Agreement or any other Loan Document by any party
thereto;

 

(xi) the occurrence or continuance of an Insolvency Proceeding with respect to
any Loan Party;

 

(xii) the fact that an Event of Default or a Potential Default shall have
occurred and be continuing;

 

(xiii) the fact that the Revolving Expiration Date or the Tranche B Maturity
Date shall have passed or this Agreement or the Commitments hereunder shall have
been terminated; and

 

(xiv) any other circumstance or happening whatsoever, whether or not similar to
any of the foregoing.

 

2.9.8 Indemnity.

 

In addition to amounts payable as provided in Section 10.5 [Reimbursement and
Indemnification of Agents by the Borrower], the Borrower hereby agrees to
protect, indemnify, pay and save harmless the Issuing Bank, in its capacity as
issuer of a Letter of Credit, and any of Issuing Bank’s Affiliates that has
issued a Letter of Credit from and against any and all claims, demands,
liabilities, damages, taxes, penalties, interest, judgments, losses, costs,
charges and expenses (including reasonable out-of-pocket fees, expenses and
disbursements of counsel, but excluding franchise taxes and taxes on or measured
by the income of Issuing Bank or Issuing Bank’s Affiliates) which the Issuing
Bank or any of Issuing Bank’s Affiliates may incur or be subject to as a
consequence, direct or indirect, of the issuance of any Letter of Credit, other
than as a result of (A) the gross negligence or willful misconduct of the
Issuing Bank as determined by a final judgment of a court of competent
jurisdiction or (B) the wrongful dishonor by the Issuing Bank or any of Issuing
Bank’s Affiliates of a proper demand for payment made under any Letter of
Credit, except if such dishonor resulted from any act or omission, whether
rightful or wrongful, of any present or future de jure or de facto government or
governmental authority (all such acts or omissions herein called “Governmental
Acts”).

 

2.9.9 Liability for Acts and Omissions.

 

As between any Loan Party and the Issuing Bank, or the Issuing Bank’s
Affiliates, such Loan Party assumes all risks of the acts and omissions of, or
misuse of the Letters of Credit by, the respective beneficiaries of such Letters
of Credit. In furtherance and not in limitation of the foregoing, the Issuing
Bank shall not be responsible for any of the following including any losses or
damages to any Loan Party or other Person or property relating therefrom: (i)
the form, validity, sufficiency, accuracy, genuineness or legal effect of any
document (including all sight drafts, certificates and all other instruments)
submitted by any party in connection with any such Letter of Credit, even if it
should in fact prove to be in any or all respects invalid, insufficient,
inaccurate, fraudulent or forged (even if the Issuing Bank or the Issuing Bank’s
Affiliates shall have been notified thereof); (ii) the validity or sufficiency
of any instrument

 

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transferring or assigning or purporting to transfer or assign any such Letter of
Credit or the rights or benefits thereunder or proceeds thereof, in whole or in
part, which may prove to be invalid or ineffective for any reason; (iii) the
failure of the beneficiary of any such Letter of Credit, or any other party to
which such Letter of Credit may be transferred, to comply fully with any
conditions required in order to draw upon such Letter of Credit or any other
claim of any Loan Party against any beneficiary of such Letter of Credit, or any
such transferee, or any dispute between or among any Loan Party and any
beneficiary of any Letter of Credit or any such transferee; (iv) errors,
omissions, interruptions or delays in transmission or delivery of any messages,
by mail, cable, telegraph, telex or otherwise, whether or not they be in cipher;
(v) errors in interpretation of technical terms; (vi) any loss or delay in the
transmission or otherwise of any document required in order to make a drawing
under any such Letter of Credit or of the proceeds thereof; (vii) the
misapplication by the beneficiary of any such Letter of Credit of the proceeds
of any drawing under such Letter of Credit; or (viii) any consequences arising
from causes beyond the control of the Issuing Bank or the Issuing Bank’s
Affiliates, as applicable, including any Governmental Acts, and none of the
above shall affect or impair, or prevent the vesting of, any of the Issuing
Bank’s or the Issuing Bank’s Affiliates rights or powers hereunder. Nothing in
the preceding sentence shall relieve the Issuing Bank from liability for (a) the
Issuing Bank’s gross negligence or willful misconduct in connection with actions
or omissions described in clauses (i) through (viii) of such sentence or (b)
with respect to any damages suffered by any Loan Party that such Loan Party
proves were caused by the Issuing Bank’s willful failure to pay under any Letter
of Credit after the presentation to it by the beneficiary of a sight draft and
certificate(s) strictly complying with the terms and conditions of a Letter of
Credit. In no event shall the Issuing Bank or the Issuing Bank’s Affiliates be
liable to any Loan Party for any indirect, consequential, incidental, punitive,
exemplary or special damages or expenses (including without limitation
attorneys’ fees), or for any damages resulting from any change in the value of
any property relating to a Letter of Credit.

 

Without limiting the generality of the foregoing, the Issuing Bank and each of
its Affiliates (i) may rely on any oral or other communication believed in good
faith by the Issuing Bank or such Affiliate to have been authorized or given by
or on behalf of the applicant for a Letter of Credit, (ii) may honor any
presentation if the documents presented appear on their face substantially to
comply with the terms and conditions of the relevant Letter of Credit; (iii) may
honor a previously dishonored presentation under a Letter of Credit, whether
such dishonor was pursuant to a court order, to settle or compromise any claim
of wrongful dishonor, or otherwise, and shall be entitled to reimbursement to
the same extent as if such presentation had initially been honored, together
with any interest paid by the Issuing Bank or its Affiliate; (iv) may honor any
drawing that is payable upon presentation of a statement advising negotiation or
payment, upon receipt of such statement (even if such statement indicates that a
draft or other document is being delivered separately), and shall not be liable
for any failure of any such draft or other document to arrive, or to conform in
any way with the relevant Letter of Credit; (v) may pay any paying or
negotiating bank claiming that it rightfully honored under the laws or practices
of the place where such bank is located; and (vi) may settle or adjust any claim
or demand made on the Issuing Bank or its Affiliate in any way related to any
order issued at the applicant’s request to an air carrier, a letter of guarantee
or of indemnity issued to a carrier or any similar document (each an “Order”)
and honor any drawing in connection with any Letter of Credit that is the
subject to such Order, notwithstanding that any drafts or other documents
presented in

 

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connection with such Letter of Credit fail to conform in any way with such
Letter of Credit. In furtherance and extension and not in limitation of the
specific provisions set forth above, any action taken or omitted by the Issuing
Bank or the Issuing Bank’s Affiliates under or in connection with the Letters of
Credit issued by it or any documents and certificates delivered thereunder, if
taken or omitted in good faith, shall not put the Issuing Bank or the Issuing
Bank’s Affiliates under any resulting liability to the Borrower or any Lender,
unless such action taken or omitted, is found, in a final decision by an
Official Body, to have constituted gross negligence.

 

3. TRANCHE B CREDIT-LINKED DEPOSITS

 

3.1 Tranche B Credit-Linked Deposit Account.

 

(a) Each Tranche B Lender shall deposit with the Paying Agent its Tranche B
Credit-Linked Deposit, as reflected on Schedule 1.1(B), in full on the Closing
Date. The Tranche B Credit-Linked Deposits shall be held by the Paying Agent in
the Tranche B Credit-Linked Deposit Account, and no party other than the Paying
Agent shall have a right of withdrawal from the Tranche B Credit-Linked Deposit
Account or any other right or power with respect to the Tranche B Credit-Linked
Deposits, except as expressly set forth in Section 2.9.3.2 and Section 3.2
[Return of Tranche B Credit-Linked Deposits]. Notwithstanding any provision in
this Agreement to the contrary, the sole funding obligation of each Tranche B
Lender in respect of its participation in Tranche B Letters of Credit shall be
satisfied in full upon the funding of its Tranche B Credit-Linked Deposit on the
Closing Date.

 

(b) Each of the Borrower, the Paying Agent, the Issuing Bank and each Tranche B
Lender hereby acknowledges and agrees that (i) each Tranche B Lender is funding
its Tranche B Credit-Linked Deposit to the Paying Agent for application in the
manner contemplated by Section 2.9.3.2 and (ii) the Tranche B Credit-Linked
Deposits held by the Paying Agent in the Tranche B Credit-Linked Deposit Account
will be deposited by the Paying Agent into a single certificate of deposit
issued by PNC Bank, National Association with the terms and conditions described
on Schedule 3.1(b) (the “Tranche B Certificate of Deposit”). All interest
accruing on the Tranche B Certificate of Deposit will be paid by the Paying
Agent ratably to the Tranche B Lenders quarterly in arrears when Tranche B
Letter of Credit Fees are payable pursuant to Section 2.9.2 [Letter of Credit
Fees]. It is understood and agreed that the obligation to pay interest on the
Tranche B Certificate of Deposit shall be the exclusive obligation of Paying
Agent based upon the interest earned on the Tranche B Credit-Linked Deposits and
the Borrower shall not be obligated to pay such interest. During periods when,
and to the extent to which, such Tranche B Credit-Linked Deposits are used by
the Paying Agent to cover unreimbursed Tranche B LC Disbursements, (i) the
Tranche B Certificate of Deposit shall be reduced by such amount and (ii) the
Tranche B Lenders shall be entitled to receive interest on such amounts from the
Borrower at the default interest rate, all as more specifically described in
Section 2.9.3.4.

 

(c) The Borrower shall have no right, title or interest in or to the Tranche B
Credit-Linked Deposits and no obligations with respect thereto (except for the
reimbursement obligations provided in Section 2.9.3 [Disbursements,
Reimbursement]), it being acknowledged and agreed by the parties hereto that the
making of the Tranche B Credit-Linked

 

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Deposits by the Tranche B Lenders, the provisions of this Section 3.1 and the
application of the Tranche B Credit-Linked Deposits in the manner contemplated
by Section 2.9.3.2 constitute agreements among the Paying Agent, the Issuing
Bank issuing any Tranche B Letter of Credit and each Tranche B Lender with
respect to the funding obligations of each Tranche B Lender in respect of its
participation in Tranche B Letters of Credit and do not constitute any loan or
extension of credit to the Borrower.

 

(d) Subject to the Borrower’s compliance with the cash-collateralization
requirements set forth in Section 2.9.3.5 and Section 10.13, the Paying Agent
shall return any remaining Tranche B Credit-Linked Deposits to the Tranche B
Lenders following the Tranche B Maturity Date.

 

(e) If the Paying Agent is advised that U.S. Dollar deposits (in the applicable
amounts) are not being offered in the London interbank market, or the Paying
Agent is advised by the issuer of the Tranche B Certificate of Deposit that
adequate and fair means do not otherwise exist for ascertaining the Benchmark
LIBOR Rate, then the Tranche B Credit-Linked Deposits shall be invested by the
Paying Agent in other investments so as to earn a return equal to the greater of
the Federal Funds Effective Rate and a rate determined by the Paying Agent in
accordance with banking industry rules on interbank compensation and such return
shall be paid ratably to the Tranche B Lenders quarterly in arrears when Tranche
B Letter of Credit Fees are payable pursuant to Section 2.9.2 [Letter of Credit
Fees]. In addition, the Borrower shall reimburse, on demand, the Paying Agent
and the issuer of the Tranche B Certificate of Deposit (i) for any losses or
expenses incurred by either party in connection with withdrawals from or
termination of the Tranche B Certificate of Deposit prior to the Tranche B
Maturity Date and (ii) for any administrative costs or expenses (not including
investment losses) incurred by either party in connection with investing the
Tranche B Deposits in a manner other than in the Tranche B Certificate of
Deposit in the event that adequate and fair means do not exist for ascertaining
the Benchmark LIBOR Rate (as determined by the issuer of the Tranche B
Certificate of Deposit).

 

3.2 Return of Tranche B Credit-Linked Deposits.

 

(a) The Borrower may at any time or from time to time direct the Paying Agent to
reduce the total Tranche B Credit-Linked Deposits; provided that (i) each
reduction of the Tranche B Credit-Linked Deposits shall be in an amount that is
an integral multiple of $1,000,000 and not less than $5,000,000 and (ii) the
Borrower shall not direct the Paying Agent to reduce the Tranche B Credit-Linked
Deposits if, after giving effect to such reduction (and to the provisions of
Section 2.9.1.2 [Issuance of Letters of Credit]), the aggregate Tranche B LC
Exposure would exceed the total Tranche B Credit-Linked Deposits. In the event
the Tranche B Credit-Linked Deposits shall be reduced as provided in the
preceding sentence, subject to the provisions of Section 10.13.2, the Paying
Agent will, so long as no Event of Default is in existence, return such amounts
in the Tranche B Credit-Linked Deposit to the Tranche B Lenders, ratably in
accordance with their Ratable Shares of the total Tranche B Credit-Linked
Deposits (as determined immediately prior to such reduction). The Borrower shall
notify the Paying Agent of any election to reduce the total Tranche B
Credit-Linked Deposits under this subsection at least thirty (30) calendar days
prior to the effective date of such reduction, provided, however, that such
reduction date shall only be on the last day of the then-applicable Benchmark

 

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LIBOR Interest Period, specifying such election and the effective date thereof.
Promptly following such receipt of any such notice, the Paying Agent shall
advise the Lenders of the contents thereof. Each notice delivered by the
Borrower pursuant to this subsection shall be irrevocable. Each reduction in the
total Tranche B Credit-Linked Deposits shall be permanent and shall be made
ratably among the Tranche B Lenders in accordance with their Ratable Shares.
Each return of Tranche B Credit-Linked Deposits shall be accompanied by accrued
interest on the amount of Tranche B Credit-Linked Deposits paid but excluding
the date of return.

 

(b) If any Tranche B Letter of Credit remains outstanding on the Tranche B
Maturity Date, the Borrower will deposit with the Paying Agent an amount in cash
equal to 100% of the aggregate undrawn amount of such Letter of Credit to secure
the Borrower’s reimbursement obligations with respect to any drawings that may
occur thereunder. Subject only to the Borrower’s compliance with its obligations
under the preceding sentence, any amount of the Tranche B Credit-Linked Deposits
held in the Tranche B Credit-Linked Deposit Account will, subject to the
provisions of Section 10.13.2, be returned to the Tranche B Lenders on the
Tranche B Maturity Date. Each return of Tranche B Credit-Linked Deposits
pursuant to this paragraph (b) shall be accompanied by accrued interest on the
amount of Tranche B Credit-Linked Deposits paid to but excluding the date of
return.

 

3.3 Evidence of Tranche B Credit-Linked Deposits.

 

The Paying Agent shall maintain in accordance with its usual practice a
book-entry evidencing each Lender’s Tranche B Credit-Linked Deposit in which the
Paying Agent will record (a) the amount of each Lender’s Tranche B Credit-Linked
Deposit, (b) the amount of all interest accruing on the Tranche B Credit-Linked
Deposit, and (c) the amount of all withdrawals and deposits to the Tranche B
Credit-Linked Deposit made pursuant to this Agreement. The book entries
maintained by the Paying Agent pursuant to this Section 3.3 shall be prima facie
evidence of the amounts of the Tranche B Credit-Linked Deposits.

 

3.4 Interests in Tranche B Credit-Linked Deposits.

 

To the extent that interests in the rights and obligations of Tranche B Lenders
under this Agreement are deemed to be securities, such interests have not been
and will not be registered under the Securities Act of 1933 or 12 C.F.R. part
16. The Tranche B Credit-Linked Deposits will not be registered as an investment
company under the Investment Company Act of 1940.

 

4. INTEREST RATES

 

4.1 Interest Rate Options.

 

The Borrower shall pay interest in respect of the outstanding unpaid principal
amount of the Loans as selected by it from the Base Rate Option or Euro-Rate
Option set forth below applicable to the Loans, it being understood that,
subject to the provisions of this Agreement, the Borrower may select different
Interest Rate Options and different Interest Periods to apply simultaneously to
the Loans comprising different Borrowing Tranches and may convert

 

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to or renew one or more Interest Rate Options with respect to all or any portion
of the Loans comprising any Borrowing Tranche, provided that there shall not be
at any one time outstanding more than eight (8) Borrowing Tranches in the
aggregate among all of the Loans. If at any time the designated rate applicable
to any Loan made by any Lender exceeds such Lender’s highest lawful rate, the
rate of interest on such Lender’s Loan shall be limited to such Lender’s highest
lawful rate.

 

4.1.1 Revolving Credit Interest Rate Options.

 

The Borrower shall have the right to select from the following Interest Rate
Options applicable to the Revolving Credit Loans (subject to the provisions of
Section 4.1.3 [Interest Rate for Swing Loans] regarding Swing Loans):

 

(i) Revolving Credit Base Rate Option: A fluctuating rate per annum (computed on
the basis of a year of 365 or 366 days, as the case may be, and actual days
elapsed) equal to the Base Rate plus the Applicable Margin, such interest rate
to change automatically from time to time effective as of the effective date of
each change in the Base Rate; or

 

(ii) Revolving Credit Euro-Rate Option: A rate per annum (computed on the basis
of a year of 360 days and actual days elapsed) equal to the Euro-Rate plus the
Applicable Margin.

 

4.1.2 [Intentionally Omitted]

 

4.1.3 Interest Rate for Swing Loans.

 

Swing Loans outstanding from time to time shall bear interest at the then in
effect rate of interest applicable to Revolving Credit Loans subject to the Base
Rate Option.

 

4.1.4 Rate Quotations.

 

The Borrower may call the Paying Agent on or before the date on which a Loan
Request is to be delivered to receive an indication of the rates then in effect,
but it is acknowledged that such projection shall not be binding on the Paying
Agent or the Lenders nor affect the rate of interest which thereafter is
actually in effect when the election is made.

 

4.2 Interest Periods.

 

At any time when the Borrower shall select, convert to or renew a Euro-Rate
Option, the Borrower shall notify the Paying Agent thereof at least three (3)
Business Days prior to the effective date of such Euro-Rate Option by delivering
a Loan Request. The notice shall specify an Interest Period during which such
Interest Rate Option shall apply. Notwithstanding the preceding sentence, the
following provisions shall apply to any selection of, renewal of, or conversion
to a Euro-Rate Option:

 

4.2.1 Amount of Borrowing Tranche.

 

each Borrowing Tranche of Loans to which a Euro-Rate Option applies shall be in
integral multiples of $1,000,000 and not less than $5,000,000;

 

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4.2.2 Renewals.

 

in the case of the renewal of a Euro-Rate Option at the end of an Interest
Period, the first day of the new Interest Period shall be the last day of the
preceding Interest Period, without duplication in payment of interest for such
day.

 

4.3 Interest After Default.

 

To the extent permitted by Law, upon the occurrence of an Event of Default and
until such time such Event of Default shall have been cured or waived:

 

4.3.1 Letter of Credit Fees, Interest Rate.

 

the Letter of Credit Fees and the rate of interest for each Loan otherwise
applicable pursuant to Section 2.9.2 [Letter of Credit Fees] or Section 4.1
[Interest Rate Options], respectively, shall be increased by 2.0% per annum; and

 

4.3.2 Other Obligations.

 

each other Obligation hereunder if not paid when due shall bear interest at a
rate per annum equal to the sum of the rate of interest applicable under the
Base Rate Option plus an additional 2.0% per annum from the time such Obligation
becomes due and payable and until it is paid in full.

 

4.3.3 Acknowledgment.

 

The Borrower acknowledges that the increase in rates referred to in this Section
4.3 reflects, among other things, the fact that such Loans or other amounts have
become a substantially greater risk given their default status and that the
Lenders are entitled to additional compensation for such risk; and all such
interest shall be payable by Borrower upon demand by Paying Agent.

 

4.3.4 Euro-Rate Option Not Available Under Certain Circumstances.

 

Upon the occurrence of an Event of Default, no Loan may be made, converted to,
or renewed under a Euro-Rate Option.

 

4.4 Euro-Rate Unascertainable; Illegality; Increased Costs; Deposits Not
Available.

 

4.4.1 Unascertainable.

 

If on any date on which a Euro-Rate would otherwise be determined, the Paying
Agent shall have determined that:

 

(i) adequate and reasonable means do not exist for ascertaining such Euro-Rate,
or

 

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(ii) a contingency has occurred which materially and adversely affects the
London interbank eurodollar market relating to the Euro-Rate,

 

then the Paying Agent shall have the rights specified in Section 4.4.3 [Paying
Agent’s and Lender’s Rights].

 

4.4.2 Illegality; Increased Costs; Deposits Not Available.

 

If at any time any Lender shall have determined that:

 

(i) the making, maintenance or funding of any Loan to which a Euro-Rate Option
applies has been made impracticable or unlawful by compliance by such Lender in
good faith with any Law or any interpretation or application thereof by any
Official Body or with any request or directive of any such Official Body
(whether or not having the force of Law), or

 

(ii) such Euro-Rate Option will not adequately and fairly reflect the cost to
such Lender of the establishment or maintenance of any such Loan, or

 

(iii) after making all reasonable efforts, deposits of the relevant amount in
Dollars for the relevant Interest Period for a Loan, or to banks generally, to
which a Euro-Rate Option applies, respectively, are not available to such Lender
with respect to such Loan, or to banks generally, in the interbank eurodollar
market,

 

then the Paying Agent shall have the rights specified in Section 4.4.3 [Paying
Agent’s and Lender’s Rights].

 

4.4.3 Paying Agent’s and Lender’s Rights.

 

In the case of any event specified in Section 4.4.1 [Unascertainable] above, the
Paying Agent shall promptly so notify the Lenders and the Borrower thereof, and
in the case of an event specified in Section 4.4.2 [Illegality, Etc.] above,
such Lender shall promptly so notify the Paying Agent and endorse a certificate
to such notice as to the specific circumstances of such notice, and the Paying
Agent shall promptly send copies of such notice and certificate to the other
Lenders and the Borrower. Upon such date as shall be specified in such notice
(which shall not be earlier than the date such notice is given), the obligation
of (A) the Lenders, in the case of such notice given by the Paying Agent, or (B)
such Lender, in the case of such notice given by such Lender, to allow the
Borrower to select, convert to or renew a Euro-Rate Option shall be suspended
until the Paying Agent shall have later notified the Borrower, or such Lender
shall have later notified the Paying Agent, of the Paying Agent’s or such
Lender’s, as the case may be, determination that the circumstances giving rise
to such previous determination no longer exist. If at any time the Paying Agent
makes a determination under Section 4.4.1 and the Borrower has previously
notified the Paying Agent of its selection of, conversion to or renewal of a
Euro-Rate Option and such Interest Rate Option has not yet gone into effect,
such notification shall be

 

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deemed to provide for selection of, conversion to or renewal of the Base Rate
Option otherwise available with respect to such Loans. If any Lender notifies
the Paying Agent of a determination under Section 4.4.2, the Borrower shall,
subject to the Borrower’s indemnification Obligations under Section 5.6.2
[Indemnity], as to any Loan of the Lender to which a Euro-Rate Option applies,
on the date specified in such notice either convert such Loan to the Base Rate
Option otherwise available with respect to such Loan or prepay such Loan in
accordance with Section 5.4 [Voluntary Prepayments]. Absent due notice from the
Borrower of conversion or prepayment, such Loan shall automatically be converted
to the Base Rate Option otherwise available with respect to such Loan upon such
specified date.

 

4.5 Selection of Interest Rate Options.

 

If the Borrower fails to select a new Interest Period to apply to any Borrowing
Tranche of Loans under the Euro-Rate Option at the expiration of an existing
Interest Period applicable to such Borrowing Tranche in accordance with the
provisions of Section 4.2 [Interest Periods], the Borrower shall be deemed to
have converted such Borrowing Tranche to the Base Rate Option, commencing upon
the last day of the existing Interest Period.

 

5. PAYMENTS

 

5.1 Payments.

 

All payments and prepayments to be made in respect of principal, interest,
Commitment Fees, Letter of Credit Fees, Agent’s Fee or other fees or amounts due
from the Borrower hereunder shall be payable prior to 1:00 p.m., Pittsburgh
time, on the date when due without presentment, demand, protest or notice of any
kind, all of which are hereby expressly waived by the Borrower, and without
set-off, counterclaim or other deduction of any nature, and an action therefor
shall immediately accrue. Such payments shall be made to the Paying Agent at the
Principal Office for the account of PNC Bank with respect to the Swing Loans and
for the ratable accounts of the Revolving Lenders with respect to the Revolving
Credit Loans or Tranche B Lenders with respect to the Tranche B Credit-Linked
Deposits in U.S. Dollars and in immediately available funds, and the Paying
Agent shall promptly distribute such amounts to the Lenders in immediately
available funds, provided that in the event payments are received by 1:00 p.m.,
Pittsburgh time, and such payments are not distributed to the Lenders on the
same day received by the Paying Agent, the Paying Agent shall pay the Lenders
the Federal Funds Effective Rate with respect to the amount of such payments for
each day held by the Paying Agent and not distributed to the Lenders. The Paying
Agent’s and each Lender’s statement of account, ledger or other relevant record
shall, in the absence of manifest error, be conclusive as the statement of the
amount of principal of and interest on the Loans and other amounts owing under
this Agreement and shall be deemed an “account stated.”

 

5.2 Pro Rata Treatment of Lenders.

 

Each borrowing of Revolving Credit Loans shall be allocated to each Revolving
Lender according to its Revolving Credit Ratable Share. The Tranche B
Credit-Linked

 

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Deposits shall be allocated to each Tranche B Lender according to its Tranche B
Ratable Share. Each selection of, conversion to or renewal of any Interest Rate
Option applicable to Revolving Credit Loans and each payment, prepayment or
reduction by the Borrower with respect to principal or interest on the Revolving
Credit Loans or Tranche B Credit-Linked Deposits or Commitment Fees, Letter of
Credit Fees, or other fees (except for the Agent’s Fee) or amounts due from the
Borrower hereunder to the Revolving Lenders with respect to the Revolving Credit
Loans or Tranche B Lenders with respect to Tranche B Credit-Linked Deposits,
shall (except as provided in Section 4.4.3 [Paying Agent’s and Lender’s Rights]
in the case of an event specified in Section 4.4 [Euro-Rate Unascertainable;
Etc.], 5.4.2 [Replacement of a Lender] or 5.6 [Additional Compensation in
Certain Circumstances]) be made in proportion to the applicable Revolving Credit
Loans or Tranche B Credit-Linked Deposits outstanding from each Lender and, if
no such Loans or Tranche B Credit-Linked Deposits are then outstanding, in
proportion, as applicable, to the Revolving Credit Ratable Share or the Tranche
B Ratable Share, as the case may be, of each Lender. Notwithstanding any of the
foregoing, each borrowing or payment or prepayment by the Borrower of principal,
interest, fees or other amounts from the Borrower with respect to Swing Loans
shall be made by or to the Paying Agent on behalf of PNC Bank according to
Section 2 [Revolving Credit and Swing Loan Facilities].

 

5.3 Interest Payment Dates.

 

Interest on Loans to which the Base Rate Option applies shall be due and payable
in arrears on the first Business Day of each March, June, September and December
after the date hereof and on the Revolving Expiration Date or upon acceleration
of the Notes. Interest on Loans to which the Euro-Rate Option applies shall be
due and payable on the last day of each Interest Period for those Loans, if such
Interest Period is longer than three (3) Months, also on the 90th day of such
Interest Period. Interest on the principal amount of each Loan or other monetary
Obligation shall be due and payable on demand after such principal amount or
other monetary Obligation becomes due and payable (whether on the stated
maturity date, upon acceleration or otherwise).

 

5.4 Voluntary Prepayments.

 

5.4.1 Right to Prepay.

 

The Borrower shall have the right at its option from time to time to prepay the
Loans in whole or part without premium or penalty (except as provided in Section
5.4.2 [Replacement of a Lender] below or in Section 5.6 [Additional Compensation
in Certain Circumstances]):

 

(i) at any time with respect to any Loan to which the Base Rate Option applies,

 

(ii) on the last day of the applicable Interest Period with respect to Loans to
which a Euro-Rate Option applies, and

 

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(iii) on the date specified in a notice by any Lender pursuant to Section 4.4
[Euro-Rate Unascertainable, Etc.] with respect to any Loan to which a Euro-Rate
Option applies.

 

Whenever the Borrower desires to prepay any part of the Loans, it shall provide
a prepayment notice to the Paying Agent by 11:00 a.m., Pittsburgh time, on the
date of prepayment of the Revolving Credit Loans or Swing Loans, setting forth
the following information:

 

(x) the date, which shall be a Business Day, on which the proposed prepayment is
to be made;

 

(y) a statement indicating the application of the prepayment between the Swing
Loans and Revolving Credit Loans; and

 

(z) the total principal amount of such prepayment of Loans, which shall not be
less than $100,000 (or the total principal outstanding if less) for any Swing
Loans, or $1,000,000 (or the total principal outstanding, if less) for any
Revolving Credit Loans.

 

All prepayment notices shall be irrevocable. The principal amount of the Loans
for which a prepayment notice is given, together with interest on such principal
amount, shall be due and payable on the date specified in such prepayment notice
as the date on which the proposed prepayment is to be made. Except as provided
in Section 4.4.3 [Paying Agent’s and Lender’s Rights], if the Borrower prepays a
Loan but fails to specify the applicable Borrowing Tranche which the Borrower is
prepaying, the prepayment shall be applied (i) first to Swing Loans, second to
Revolving Credit Loans; and (ii) after giving effect to all the foregoing
allocations, first to Loans to which the Base Rate Option applies, then to Loans
to which the Euro-Rate Option applies. Any prepayment hereunder shall be subject
to the Borrower’s Obligation to indemnify the Lenders under Section 5.6.2
[Indemnity].

 

5.4.2 Replacement of a Lender.

 

In the event any Lender (i) gives notice under Section 4.4 [Euro-Rate
Unascertainable, Etc.] or Section 5.6.1 [Increased Costs, Etc.], (ii) does not
fund Revolving Credit Loans because the making of such Loans would contravene
any Law applicable to such Lender, or (iii) becomes subject to the control of an
Official Body (other than normal and customary supervision), then the Borrower
shall have the right at its option, with the consent of the Paying Agent, which
shall not be unreasonably withheld, to prepay the Loans of such Lender in whole,
together with all interest accrued thereon, and terminate such Lender’s
Commitment within ninety (90) days after (x) receipt of such Lender’s notice
under Section 4.4 [Euro-Rate Unascertainable, Etc.] or 5.6.1 [Increased Costs,
Etc.], (y) the date such Lender has failed to fund Revolving Credit Loans
because the making of such Loans would contravene Law applicable to such Lender,
or (z) the date such Lender became subject to the control of an Official Body,
as applicable; provided that the Borrower shall also pay to such Lender at the
time of such prepayment any amounts required under Section 5.6 [Additional
Compensation in Certain

 

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Circumstances] and any accrued interest due on such amount and any related fees;
provided, however, that the Commitment of such Lender shall be provided by one
or more of the remaining Lenders or a replacement bank acceptable to the Paying
Agent; provided, further, the remaining Lenders shall have no obligation
hereunder to increase their Commitments. Notwithstanding the foregoing, the
Paying Agent may only be replaced subject to the requirements of Section 10.14
[Successor Agents] and provided that all Letters of Credit have expired or been
terminated or replaced.

 

5.4.3 Mitigation Obligation.

 

Each Lender agrees that upon the occurrence of any event giving rise to
increased costs or other special payments under Section 4.4.2 [Illegality, Etc.]
or 5.6.1 [Increased Costs, Etc.] with respect to such Lender, it will if
requested by the Borrower, use reasonable efforts (subject to overall policy
considerations of such Lender) to designate another lending office for any Loans
or Letters of Credit affected by such event, provided that such designation is
made on such terms that such Lender and its lending office suffer no economic,
legal or regulatory disadvantage, with the object of avoiding the consequence of
the event giving rise to the operation of such Section. Nothing in this Section
5.4.3 shall affect or postpone any of the Obligations of the Borrower or any
other Loan Party or the rights of the Paying Agent or any Lender provided in
this Agreement.

 

5.5 [Intentionally Deleted]

 

5.6 Additional Compensation in Certain Circumstances.

 

5.6.1 Increased Costs or Reduced Return Resulting from Taxes, Reserves, Capital
Adequacy Requirements, Expenses, Etc.

 

If any Law, guideline or interpretation or any change in any Law, guideline or
interpretation or application thereof by any Official Body charged with the
interpretation or administration thereof or compliance with any request or
directive (whether or not having the force of Law) of any central bank or other
Official Body:

 

(i) subjects any Lender or the Issuing Bank to any tax or changes the basis of
taxation with respect to this Agreement, the Notes, the Loans, the Letters of
Credit, interest earned on the Tranche B Certificate of Deposit or payments by
the Borrower of principal, interest, Commitment Fees, or other amounts due from
the Borrower hereunder or under the Notes (except for taxes on the overall net
income of such Lender or the Issuing Bank),

 

(ii) imposes, modifies or deems applicable any reserve, special deposit or
similar requirement against credits or commitments to extend credit extended by,
or assets (funded or contingent) of, deposits with or for the account of, or
other acquisitions of funds by, any Lender or the Issuing Bank or the issuer of
the Tranche B Certificate of Deposit, or

 

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(iii) imposes, modifies or deems applicable any capital adequacy or similar
requirement (A) against assets (funded or contingent) of, or letters of credit,
other credits or commitments to extend credit extended by, any Lender or the
Issuing Bank, or (B) otherwise applicable to the obligations of any Lender or
the Issuing Bank under this Agreement,

 

and the result of any of the foregoing is to increase the cost to, reduce the
income receivable by, or impose any expense (including loss of margin) upon (1)
any Lender or the Issuing Bank with respect to this Agreement, the Notes, the
making, maintenance or funding of any part of the Loans or with respect to the
Letters of Credit (or, in the case of any capital adequacy or similar
requirement, to have the effect of reducing the rate of return on the Issuing
Bank’s or any Lender’s capital, taking into consideration the Issuing Bank’s or
such Lender’s customary policies with respect to capital adequacy) or (2) the
issuer of the Tranche B Certificate of Deposit, by an amount which such Lender,
the Issuing Bank or the issuer of the Tranche B Certificate of Deposit, in its
sole discretion, deems to be material, the Issuing Bank, the issuer of the
Tranche B Certificate of Deposit or such Lender shall from time to time notify
the Borrower and the Paying Agent of the amount determined in good faith (using
any averaging and attribution methods employed in good faith) by the Issuing
Bank, the issuer of the Tranche B Certificate of Deposit or such Lender to be
necessary to compensate the Issuing Bank, the issuer of the Tranche B
Certificate of Deposit or such Lender for such increase in cost, reduction of
income, additional expense or reduced rate of return. Such notice shall set
forth in reasonable detail the basis for such determination. Such amount shall
be due and payable by the Borrower to the Issuing Bank, the issuer of the
Tranche B Certificate of Deposit or such Lender ten (10) Business Days after
such notice is given.

 

5.6.2 Indemnity.

 

In addition to the compensation required by Section 5.6.1 [Increased Costs,
Etc.], the Borrower shall indemnify the Issuing Bank, the issuer of the Tranche
B Certificate of Deposit and each Lender against all liabilities, losses or
expenses (including loss of margin, any loss or expense incurred in liquidating
or employing deposits from third parties and any loss or expense incurred in
connection with funds acquired by the Issuing Bank or a Lender to fund or
maintain Loans subject to a Euro-Rate Option or investments of the Tranche B
Credit-Linked Deposits in the Tranche B Certificate of Deposit) which the
Issuing Bank, the issuer of the Tranche B Certificate of Deposit or such Lender
sustains or incurs with respect to the foregoing as a consequence of any:

 

(i) payment, prepayment, conversion or renewal of any Loan to which a Euro-Rate
Option applies on a day other than the last day of the corresponding Interest
Period (whether or not such payment or prepayment is mandatory, voluntary or
automatic and whether or not such payment, prepayment then due),

 

(ii) withdrawals from the Tranche B Certificate of Deposit prior to the Tranche
B Maturity Date;

 

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(iii) attempt by the Borrower to revoke (expressly, by later inconsistent
notices or otherwise) in whole or part any Loan Requests under Section 2.5.1
[Revolving Credit Loan Requests]or Section 4.2 [Interest Periods] or notice
relating to prepayments under Section 5.4 [Voluntary Prepayments] or notice to
reduce or terminate Revolving Credit Commitments under Section 2.4 [Voluntary
Reduction of Revolving Credit Commitments], or

 

(iv) default by the Borrower in the performance or observance of any covenant or
condition contained in this Agreement or any other Loan Document, including any
failure of the Borrower to pay when due (by acceleration or otherwise) any
principal, interest, Commitment Fee or any other amount due and payable
hereunder.

 

If the Issuing Bank, the issuer of the Tranche B Certificate of Deposit or any
Lender sustains or incurs any such loss or expense, it shall from time to time
notify the Borrower of the amount determined in good faith by the Issuing Bank,
the issuer of the Tranche B Certificate of Deposit or such Lender (which
determination may include such assumptions, allocations of costs and expenses
and averaging or attribution methods as the Issuing Bank or such Lender shall
deem reasonable) to be necessary to indemnify the Issuing Bank, the issuer of
the Tranche B Certificate of Deposit or such Lender for such loss or expense.
Such notice shall set forth in reasonable detail the basis for such
determination. Such amount shall be due and payable by the Borrower to the
Issuing Bank, the issuer of the Tranche B Certificate of Deposit or such Lender
ten (10) Business Days after such notice is given.

 

5.7 Swing Loan Settlement Date Procedures.

 

PNC Bank may, at its option, exercisable at any time for any reason whatsoever,
demand repayment of the Swing Loans, and each Revolving Lender shall make a
Revolving Credit Loan in an amount equal to such Revolving Lender’s Revolving
Credit Ratable Share of the aggregate principal amount of the outstanding Swing
Loans, plus, if PNC Bank so requests, accrued interest thereon. Notwithstanding
the foregoing, no Revolving Lender shall be obligated to make Revolving Credit
Loans in excess of its Revolving Credit Commitment minus its Revolving Credit
Ratable Share of Revolving LC Exposure. Revolving Credit Loans made pursuant to
this Section 5.7 shall bear interest at the Base Rate Option and shall be deemed
to have been properly requested in accordance with Section 2.5.1 [Revolving
Credit Loan Requests] without regard to any of the requirements of that
provision. The Paying Agent on behalf of PNC Bank shall provide notice (which
may be telephonic or written notice by letter, facsimile or telex) to the
Revolving Lenders no later than 10:00 a.m. on any Business Day that such
Revolving Credit Loans are to be made under this Section 5.7, and the Revolving
Lenders shall be unconditionally obligated to fund such Revolving Credit Loans
to the Paying Agent on behalf of PNC Bank, no later than 3:00 p.m., Pittsburgh
time, on the next Business Day (the “Settlement Date”).

 

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6. REPRESENTATIONS AND WARRANTIES

 

6.1 Representations and Warranties.

 

The Loan Parties, jointly and severally, represent and warrant to the Paying
Agent and each of the Lenders as follows:

 

6.1.1 Organization and Qualification.

 

Each Loan Party is a corporation, partnership or limited liability company duly
organized, validly existing and in good standing under the laws of its
jurisdiction of organization. Each Loan Party has the lawful power to own or
lease its properties and to conduct its business in which it is currently
engaged, except where the failure to have such power would not reasonably be
expected to result in any Material Adverse Change. Each Loan Party is duly
licensed or qualified and in good standing in each jurisdiction listed on
Schedule 6.1.1 and in all other jurisdictions where the property owned or leased
by it or the nature of the business transacted by it or both makes such
licensing or qualification necessary except to the extent that the failure to be
so duly licensed or qualified or in good standing would not reasonably be
expected to result in any Material Adverse Change.

 

6.1.2 [Intentionally Omitted.]

 

6.1.3 Subsidiaries.

 

Schedule 6.1.3 states the name of each of the Loan Parties that are Subsidiaries
of the Borrower, its jurisdiction of incorporation, its authorized capital
stock, the issued and outstanding shares thereof (referred to herein as the
“Subsidiary Shares”) and the owners thereof if it is a corporation, its
outstanding partnership interests (the “Partnership Interests”) if it is a
partnership and its outstanding limited liability company interests, interests
assigned to managers thereof and the voting rights associated therewith (the
“LLC Interests”) if it is a limited liability company. The Borrower and each of
the other Loan Parties has good and marketable title to all of the Subsidiary
Shares, Partnership Interests and LLC Interests it purports to own, free and
clear in each case of any Lien (except for inchoate Liens that do not have
priority over the Liens granted under the Loan Documents and Liens contemplated
by clauses (vi), (x), (xi), (xiii), (xv), (xvi), and (xix) of the definition of
Permitted Liens). All Subsidiary Shares, Partnership Interests and LLC Interests
have been validly issued, and all Subsidiary Shares are fully paid and
nonassessable. All capital contributions and other consideration required to be
made or paid in connection with the issuance of the Partnership Interests and
LLC Interests have been made or paid, as the case may be. There are no options,
warrants or other rights outstanding to purchase any such Subsidiary Shares,
Partnership Interests or LLC Interests except as indicated on Schedule 6.1.3.

 

6.1.4 Power and Authority.

 

Each Loan Party has full power to enter into, execute, deliver and carry out
this Agreement and the other Loan Documents to which it is a party, to incur the
Indebtedness contemplated by the Loan Documents and to perform its Obligations
under the Loan Documents

 

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to which it is a party, and all such actions have been duly authorized by all
necessary proceedings on its part.

 

6.1.5 Validity and Binding Effect.

 

This Agreement has been duly and validly executed and delivered by each Loan
Party, and each other Loan Document which any Loan Party is required to execute
and deliver has been duly executed and delivered by such Loan Party. This
Agreement and each other Loan Document constitutes legal, valid and binding
obligations of each Loan Party which is a party thereto, enforceable against
such Loan Party in accordance with its terms, except to the extent that
enforceability of any of such Loan Document may be limited by bankruptcy,
insolvency, reorganization, fraudulent conveyance, moratorium or other similar
laws affecting the enforceability of creditors’ rights generally or limiting the
right of specific performance.

 

6.1.6 No Conflict.

 

Neither the execution and delivery of this Agreement or the other Loan Documents
to which it is a party by any Loan Party nor the consummation of the
transactions herein or therein contemplated or compliance with the terms and
provisions hereof or thereof by any of them will conflict with, constitute a
default under or result in any breach of (i) the terms and conditions of the
certificate of incorporation, bylaws, certificate of limited partnership,
partnership agreement, certificate of formation, limited liability company
agreement or other organizational documents of any Loan Party or (ii) any Law,
instrument, Material Contract, order, writ, judgment, injunction or decree to
which any Loan Party is a party or by which it is bound or to which it is
subject, or result in the creation or enforcement of any Lien, charge or
encumbrance whatsoever upon any property (now or hereafter acquired) of any Loan
Party (other than Liens granted under the Loan Documents), except that certain
consents may be required under the Material Contracts in connection with any
attempt to assign such Material Contracts pursuant to the assertion of remedies
under the Loan Documents.

 

6.1.7 Litigation.

 

There are no actions, suits, proceedings or investigations pending or, to the
knowledge of any Responsible Officer of the Borrower, threatened against any
Loan Party at law or equity before any Official Body that individually or in the
aggregate would reasonably be expected to result in any Material Adverse Change.
To the knowledge of any Responsible Officer of the Borrower, none of the Loan
Parties is in violation of any order, writ, injunction or any decree of any
Official Body that would reasonably be expected to result in any Material
Adverse Change.

 

6.1.8 Title to Properties.

 

Each Loan Party has Extraction Title to all material Active Operating Properties
that are necessary or appropriate for any of the Loan Parties, taken as a whole,
to conduct their operations substantially as contemplated by the Financial
Projections, free and clear of all Liens and encumbrances except Permitted
Liens, and subject to the terms and conditions of

 

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the applicable leases; provided, however, a Loan Party shall not be in breach of
the foregoing in the event that (i) it fails to own a valid leasehold interest
which, either considered alone or together with all other such valid leaseholds
which it fails to own, is not material to the continued operations of such Loan
Party as contemplated by the Financial Projections or (ii) the Loan Party’s
interest in a leasehold is less than fully marketable because the consent of the
lessor to future assignments has not been obtained. Schedule 1.1(R) identifies
all of the Real Property interests, both owned or leased, of the Borrower and
its Subsidiaries except for Excluded Properties and is accurate in all material
respects.

 

6.1.9 Financial Statements.

 

(i) Historical Statements. The Borrower has delivered to the Paying Agent copies
of its audited consolidated year-end financial statements for and as of the end
of the fiscal year ended December 31, 2003 (the “Annual Statements”). In
addition, the Borrower has delivered to the Paying Agent copies of its unaudited
consolidated interim financial statements for the fiscal year to date and as of
the end of the fiscal quarter ended March 31, 2004 (the “Interim Statements”)
(the Annual and Interim Statements being collectively referred to as the
“Historical Statements”). The Historical Statements were compiled from the books
and records maintained by the Borrower’s management, are correct and complete in
all material respects and fairly represent the consolidated financial condition
of the Borrower and its Subsidiaries as of their dates and the results of
operations for the fiscal periods then ended and have been prepared in
accordance with GAAP consistently applied, subject (in the case of the Interim
Statements) to normal year-end audit adjustments.

 

(ii) Financial Projections. The Borrower has delivered to the Paying Agent
consolidated financial projections (including, but not limited to, balance
sheets and statements of operations and cash flows) for the Borrower and its
Subsidiaries for the period from January 1, 2004 through December 31, 2008
derived from various assumptions of the Borrower’s management (the “Financial
Projections”). The Financial Projections have been prepared in good faith based
upon reasonable assumptions (it being understood that such Financial Projections
are subject to significant uncertainties and contingencies, many of which are
beyond the Borrower’s control, and that no assurance can be given that the
Financial Projections will be realized).

 

(iii) Accuracy of Financial Statements. Neither the Borrower nor any other Loan
Party has any material liabilities, contingent or otherwise, or forward or
long-term commitments that are not disclosed in the Historical Statements or in
the notes thereto, and except as disclosed therein there are no unrealized or
anticipated losses from any commitments of the Borrower or any other Loan Party
that would reasonably be expected to cause a Material Adverse Change. Since
December 31, 2003, no Material Adverse Change has occurred.

 

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6.1.10 Use of Proceeds; Margin Stock; Section 20 Subsidiaries.

 

6.1.10.1 General.

 

The Loan Parties intend to use the proceeds of the Loans in accordance with
Sections 2.8 [Use of Proceeds] and 8.1.10 [Use of Proceeds].

 

6.1.10.2 Margin Stock.

 

None of the Loan Parties engages or intends to engage principally, or as one of
its important activities, in the business of extending credit for the purpose,
immediately, incidentally or ultimately, of purchasing or carrying margin stock
(within the meaning of Regulation U). No part of the proceeds of any Loan has
been or will be used, immediately, incidentally or ultimately, to purchase or
carry any margin stock or to extend credit to others for the purpose of
purchasing or carrying any margin stock or to refund Indebtedness originally
incurred for such purpose, or for any purpose which entails a violation of or
which is inconsistent with the provisions of the regulations of the Board of
Governors of the Federal Reserve System. None of the Loan Parties holds or
intends to hold margin stock in such amounts that more than 25% of the
reasonable value of the assets of any Loan Party are or will be represented by
margin stock.

 

6.1.10.3 Section 20 Subsidiaries.

 

The Loan Parties do not intend to use and shall not use any portion of the
proceeds of the Loans, directly or indirectly, to purchase during the
underwriting period, or for thirty (30) days thereafter, Ineligible Securities
being underwritten by a Section 20 Subsidiary.

 

6.1.11 Full Disclosure.

 

Neither this Agreement nor any other Loan Document, nor any certificate,
statement, agreement or other documents furnished to the Paying Agent or any
Lender in connection herewith or therewith, contains any untrue statement of a
material fact or omits to state a material fact necessary in order to make the
statements contained herein and therein, in light of the circumstances under
which they were made, not misleading. There is no fact known to any Loan Party
which materially adversely affects the business, property, assets, financial
condition or results of operations of the Loan Parties taken as a whole that has
not been set forth in this Agreement or in the certificates, statements,
agreements or other documents furnished in writing to the Paying Agent and the
Lenders prior to or at the date hereof in connection with the transactions
contemplated hereby.

 

6.1.12 Taxes.

 

All federal, state, local and other tax returns required to have been filed with
respect to each Loan Party have been filed, and payment or adequate provision
has been made for the payment of all such taxes, fees, assessments and other
governmental charges which have or may become due pursuant to said returns or to
assessments received, except to the extent that such taxes, fees, assessments
and other charges are being contested in good faith by appropriate proceedings
diligently conducted and for which such reserves or other appropriate
provisions, if any, as shall be required by GAAP shall have been made. There are
no agreements

 

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or waivers extending the statutory period of limitations applicable to any
federal income tax return of any Loan Party for any period.

 

6.1.13 Consents and Approvals.

 

Except for the filing of financing statements, the Mortgages in the state and
county filing offices, and the Ship Mortgages and Patent, Trademark and
Copyright Assignment in the applicable federal offices, and obtaining necessary
“blocked account” agreements from third parties with respect to deposit
accounts, securities accounts, commodities accounts and investment accounts as
permitted by the Security Agreement, no consent, approval, exemption, order or
authorization of, or a registration or filing with, any Official Body or any
other Person is necessary to authorize or permit the execution, delivery or
performance of this Agreement and the other Loan Documents or for the validity
or enforceability hereof or thereof.

 

6.1.14 No Event of Default; Compliance with Instruments.

 

No event has occurred and is continuing and no condition exists or will exist
after giving effect to the borrowings or other extensions of credit to be made
on the Closing Date under or pursuant to the Loan Documents which constitutes an
Event of Default or Potential Default. None of the Loan Parties is in violation
of (i) any term of its certificate of incorporation, bylaws, certificate of
limited partnership, partnership agreement, certificate of formation, limited
liability company agreement or other organizational documents or (ii) any
material agreement or instrument to which it is a party or by which it or any of
its properties may be subject or bound where such violation would reasonably be
expected to result in a Material Adverse Change.

 

6.1.15 Patents, Trademarks, Copyrights, Licenses, Etc.

 

Each Loan Party owns or possesses all the material patents, trademarks, service
marks, trade names, copyrights, licenses, registrations, franchises, permits and
rights necessary to own and operate its properties and to carry on its business
as presently conducted and planned to be conducted by such Loan Party, without
known or actual conflict with the rights of others where such conflict would
reasonably be expected to result in a Material Adverse Change. All material
patents, trademarks, service marks, trade names, copyrights, licenses,
registrations, franchises and permits of each Loan Party are listed and
described on Schedule 6.1.15.

 

6.1.16 Security Interests.

 

The Liens and security interests granted to the Collateral Trustee for the
benefit of the Secured Parties pursuant to the Patent, Trademark and Copyright
Assignment, the Pledge Agreement and the Security Agreement in Collateral (of
the type that can be perfected by filing under the Uniform Commercial Code)
constitute and will continue to constitute Prior Security Interests, subject to
Permitted Liens, under the Uniform Commercial Code as in effect in each
applicable jurisdiction (the “Uniform Commercial Code”) or other applicable Law
entitled to all the rights, benefits and priorities provided by the Uniform
Commercial Code or such Law. Upon the due filing of financing statements
relating to said security interests in each office and in

 

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each jurisdiction where required in order to perfect the security interests
described above, taking possession of any stock certificates or other
certificates evidencing the Pledged Collateral and recordation of the Patent,
Trademark and Copyright Assignment in the United States Patent and Trademark
Office and United States Copyright Office and the recordation of the Ship
Mortgages with the United States Coast Guard Documentation Center, as
applicable, and obtaining “blocked account” agreements with applicable third
parties as permitted by the Security Agreement with respect to deposit accounts,
securities accounts, commodities accounts and investment accounts, all such
action as is necessary or advisable to create a valid, enforceable Lien in favor
of the Collateral Trustee with respect to the Collateral described above will
have been taken. All filing fees and other expenses in connection with each such
action have been or will be paid by the Borrower.

 

6.1.17 Mortgage Liens.

 

Subject to the qualifications and limitations set forth expressly in the
Mortgages, the Liens granted to the Collateral Trustee pursuant to each Mortgage
constitute a valid first priority Lien on the Real Property under applicable
law, subject to Permitted Liens.

 

6.1.18 Status of the Pledged Collateral.

 

All the shares of capital stock, Partnership Interests or LLC Interests included
in the Pledged Collateral to be pledged pursuant to the Pledge Agreement are or
will be upon issuance validly issued and nonassessable and owned beneficially
and of record by the pledgor free and clear of any Lien or restriction on
transfer, except for Liens contemplated by clauses (vi), (x), (xi), (xiii),
(xv), (xvi), and (xix) of the definition of Permitted Liens and inchoate Liens
that do not have priority over the Liens granted under the Loan Documents and as
otherwise provided by the Pledge Agreement and except as the right of the
Lenders to dispose of such shares, the Partnership Interests or the LLC
Interests may be limited by the Securities Act of 1933, as amended, and the
regulations promulgated by the Securities and Exchange Commission thereunder and
by applicable state securities laws. There are no shareholder, partnership,
limited liability company or other agreements or understandings with respect to
the shares of capital stock, Partnership Interests or LLC Interests included in
the Pledged Collateral except for the partnership agreements and limited
liability company agreements described on Schedule 6.1.18. The Loan Parties have
delivered true and correct copies of such partnership agreements and limited
liability company agreements to the Paying Agent.

 

6.1.19 Insurance.

 

Schedule 6.1.19 lists all material insurance policies to which any Loan Party is
a party, all of which are valid and in full force and effect. Such policies
provide adequate coverage from reputable and financially sound insurers in
amounts sufficient to insure the assets and risks of each Loan Party in
accordance with prudent business practice in the industry of the Loan Parties.

 

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6.1.20 Compliance with Laws.

 

The Loan Parties are in compliance in all material respects with all applicable
Laws (other than Environmental Laws which are specifically addressed in Section
6.1.25 [Environmental Matters]) in all jurisdictions in which any Loan Party is
presently or will be doing business except where the failure to do so would not
constitute a Material Adverse Change.

 

6.1.21 Material Contracts; Burdensome Restrictions.

 

All material coal supply contracts and other Material Contracts are in full
force and effect except to the extent that the failure to be in full force and
effect would not reasonably be expected to result in a Material Adverse Change.
None of the Loan Parties is bound by any contractual obligation, or subject to
any restriction in any organization document, or any requirement of Law which
would reasonably be expected to result in a Material Adverse Change.

 

6.1.22 Investment Companies; Regulated Entities.

 

None of the Loan Parties is an “investment company” registered or required to be
registered under the Investment Company Act of 1940 or under the “control” of an
“investment company” as such terms are defined in the Investment Company Act of
1940 and shall not become such an “investment company” or under such “control.”
None of the Loan Parties is a “holding company” or any “affiliate” of a “holding
company” or of a “subsidiary company” of a “holding company” within the meaning
of the Public Utility Holding Company Act of 1935, as amended. None of the Loan
Parties is subject to any other Federal or state statute or regulation limiting
its ability to incur Indebtedness for borrowed money.

 

6.1.23 Plans and Benefit Arrangements.

 

Except as set forth on Schedule 6.1.23:

 

(i) The Borrower and each other member of the ERISA Group are in compliance in
all material respects with any applicable provisions of ERISA with respect to
all Benefit Arrangements, Plans and Multiemployer Plans. There has been no
Prohibited Transaction with respect to any Benefit Arrangement or any Plan or,
to the best knowledge of the Borrower, with respect to any Multiemployer Plan or
Multiple Employer Plan, which could result in any material liability of the
Borrower or any other member of the ERISA Group. The Borrower and all other
members of the ERISA Group have made when due any and all payments required to
be made under any agreement relating to a Multiemployer Plan or a Multiple
Employer Plan or any Law pertaining thereto. With respect to each Plan and
Multiemployer Plan, the Borrower and each other member of the ERISA Group (i)
have fulfilled in all material respects their obligations under the minimum
funding standards of ERISA, (ii) have not incurred any liability to the PBGC,
and (iii) have not had asserted against them any penalty for failure to fulfill
the minimum funding requirements of ERISA.

 

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(ii) To the best of the Borrower’s knowledge, each Multiemployer Plan and
Multiple Employer Plan is able to pay benefits thereunder when due.

 

(iii) Neither the Borrower nor any other member of the ERISA Group has
instituted or intends to institute proceedings to terminate any Plan.

 

(iv) No event requiring notice to the PBGC under Section 302(f)(4)(A) of ERISA
has occurred or is reasonably expected to occur with respect to any Plan, and no
amendment with respect to which security is required under Section 307 of ERISA
has been made or is reasonably expected to be made to any Plan.

 

(v) Neither the Borrower nor any other member of the ERISA Group has terminated
a Plan other than pursuant to a standard termination within the meaning of
section 4041(b) of ERISA. Neither the Borrower nor any member of the ERISA Group
reasonably expects to terminate any Plan where such termination would be likely
to result in the actuarial present value of the Plan’s benefit liabilities,
determined on a plan termination basis, exceeding the Plan’s assets in a
material amount.

 

(vi) Neither the Borrower nor any other member of the ERISA Group has incurred
or reasonably expects to incur any material withdrawal liability under ERISA to
any Multiemployer Plan or Multiple Employer Plan. Neither the Borrower nor any
other member of the ERISA Group has been notified by any Multiemployer Plan or
Multiple Employer Plan that such Multiemployer Plan or Multiple Employer Plan
has been terminated within the meaning of Title IV of ERISA and, to the best
knowledge of the Borrower, no Multiemployer Plan or Multiple Employer Plan is
reasonably expected to be reorganized or terminated, within the meaning of Title
IV of ERISA.

 

(vii) To the extent that any Benefit Arrangement is insured, the Borrower and
all other members of the ERISA Group have paid when due all premiums required to
be paid for all periods through the Closing Date. To the extent that any Benefit
Arrangement is funded other than with insurance, the Borrower and all other
members of the ERISA Group have made when due all contributions required to be
paid for all periods through the Closing Date.

 

(viii) In all material respects, the Plans, Benefit Arrangements and
Multiemployer Plans have been administered in accordance with their terms and
applicable Law.

 

6.1.24 Employment Matters; Coal Act; Black Lung Act.

 

Each of the Loan Parties is in compliance with the Labor Contracts and all
applicable federal, state and local labor and employment Laws including those
related to equal employment opportunity and affirmative action, labor relations,
minimum wage, overtime, child labor, medical insurance continuation, worker
adjustment and relocation notices, immigration controls and worker and
unemployment compensation, where the failure to comply would constitute a
Material Adverse Change. There are no outstanding grievances, arbitration awards
or

 

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appeals therefrom arising out of the Labor Contracts or current or threatened
strikes, picketing, handbilling or other work stoppages or slowdowns at
facilities of any of the Loan Parties which in any case would constitute a
Material Adverse Change. The Borrower, its Subsidiaries and its “related
persons” (as defined in the Coal Act) are in compliance in all material respects
with the Coal Act and none of the Borrower, its Subsidiaries or its related
persons has any liability under the Coal Act except with respect to premiums or
other payments required thereunder which have been paid when due and except to
the extent that the liability thereunder would not reasonably be expected to
result in a Material Adverse Change. The Loan Parties are in compliance in all
material respects with the Black Lung Act, and none of the Loan Parties has any
liability under the Black Lung Act except with respect to premiums,
contributions or other payments required thereunder which have been paid when
due and except to the extent that the liability thereunder would not reasonably
be expected to result in a Material Adverse Change.

 

6.1.25 Environmental Matters.

 

Except as disclosed on Schedule 6.1.25:

 

(i) Except for matters that, considered either individually or in the aggregate,
have no reasonable likelihood of materially disrupting the Gas and Coal
Operations or materially diminishing the fair market value of the Collateral,
taken as a whole, or otherwise resulting in a Material Adverse Change, none of
the Loan Parties (a) has received any Environmental Complaint, whether directed
or issued to any Loan Party or relating or pertaining to any prior owner,
operator or occupant of the Real Property, or (b) to the knowledge of any
Responsible Officer, has any reason to believe that it might receive an
Environmental Complaint.

 

(ii) Except for activities that, considered either individually or in the
aggregate, have no reasonable likelihood of materially disrupting the Gas and
Coal Operations or materially diminishing the fair market value of the
Collateral, taken as a whole, or otherwise resulting in a Material Adverse
Change, (a) no activity of any Loan Party on the Real Property is being or has
been conducted in violation of any Environmental Law or Required Environmental
Permit and (b) to the knowledge of any Responsible Officer, no activity of any
prior owner, operator or occupant of the Real Property was conducted in
violation of any Environmental Law.

 

(iii) There are no Regulated Substances present on, in, under, or emanating
from, or to any Loan Party’s knowledge emanating to, the Real Property or any
portion thereof which result in Contamination, except for such Regulated
Substances that have no reasonable likelihood of materially disrupting the Gas
and Coal Operations or materially diminishing the fair market value of the
Collateral, taken as a whole, or otherwise resulting in a Material Adverse
Change.

 

(iv) Each Loan Party has all Required Environmental Permits and all such
Required Environmental Permits are in full force and effect, except where the
failure to have any Required Environmental Permits, either in any one case or
considered together with other such failures, has no reasonable likelihood of
materially disrupting the Gas and

 

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Coal Operations or materially diminishing the fair market value of the
Collateral, taken as a whole, or otherwise resulting in a Material Adverse
Change.

 

(v) Each Loan Party has submitted to an Official Body and/or maintains, as
appropriate, all Required Environmental Notices, except for Required
Environmental Notices that have no reasonable likelihood of materially
disrupting the Gas and Coal Operations or materially diminishing the fair market
value of the Collateral, taken as a whole, or otherwise resulting in a Material
Adverse Change.

 

(vi) No structures, improvements, equipment, fixtures, impoundments, pits,
lagoons or aboveground or underground storage tanks located on the Property
contain or use Regulated Substances, except (1) in compliance with Environmental
Laws and Required Environmental Permits or (2) where the improper presence or
use of Regulated Substances have no reasonable likelihood of materially
disrupting the Gas and Coal Operations or materially diminishing the fair market
value of the Collateral, taken as a whole, or otherwise resulting in a Material
Adverse Change. To the knowledge of any Responsible Officer, no structures,
improvements, equipment, fixtures, impoundments, pits, lagoons or aboveground or
underground storage tanks of prior owners, operators or occupants of the
Property contained or used, except in material compliance with Environmental
Laws, Regulated Substances, or otherwise were operated or maintained by any such
prior owner, operator or occupant, except in compliance in all material respects
with Environmental Laws.

 

(vii) To the knowledge of any Responsible Officer, no facility or site to which
any Loan Party, either directly or indirectly by a third party, has sent
Regulated Substances for storage, treatment, disposal or other management has
been or is being operated in violation of Environmental Laws or pursuant to
Environmental Laws is identified or proposed to be identified on any list of
contaminated properties or other properties which pursuant to Environmental Laws
are the subject of an investigation, cleanup, removal, remediation or other
response action by an Official Body except where such violation, either alone or
considered together with all other such violations, has no reasonable likelihood
of materially disrupting the Gas and Coal Operations or materially diminishing
the fair market value of the Collateral, taken as a whole, or otherwise
resulting in a Material Adverse Change.

 

(viii) No portion of the Real Property is identified or to the knowledge of any
Loan Party proposed to be identified on any list of contaminated properties or
other properties which pursuant to Environmental Laws are the subject of an
investigation or remediation action by an Official Body, nor to the knowledge of
any Loan Party is any property adjoining or in the proximity of the Property
identified or proposed to be identified on any such list.

 

(ix) No portion of the Real Property constitutes an Environmentally Sensitive
Area, except for portions of the Real Property that have no reasonable
likelihood of materially disrupting the Gas and Coal Operations or materially
diminishing the fair

 

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market value of the Collateral, taken as a whole, or otherwise resulting in a
Material Adverse Change.

 

(x) No Lien or other encumbrance authorized by Environmental Laws exists against
the Real Property and none of the Loan Parties has any reason to believe that
such a Lien or encumbrance may be imposed.

 

6.1.26 Senior Debt Status.

 

The Obligations of each Loan Party under this Agreement, the Notes, the Guaranty
Agreement and each of the other Loan Documents to which it is a party do rank at
least pari passu in priority of payment with all other Indebtedness of such Loan
Party except Indebtedness of such Loan Party to the extent secured by Permitted
Liens. There is no Lien upon or with respect to any of the properties or income
of any Loan Party which secures indebtedness or other obligations of any Person
except for Permitted Liens.

 

6.1.27 Anti-Terrorism Laws.

 

6.1.27.1 General.

 

None of the Loan Parties nor or any Affiliate of any Loan Party, is in violation
of any Anti-Terrorism Law or engages in or conspires to engage in any
transaction that evades or avoids, or has the purpose of evading or avoiding, or
attempts to violate, any of the prohibitions set forth in any Anti-Terrorism
Law.

 

6.1.27.2 Executive Order No. 13224.

 

None of the Loan Parties, nor or any Affiliate of any Loan Party, or their
respective agents acting or benefiting in any capacity in connection with the
Loans, Letters of Credit or other transactions hereunder, is any of the
following (each a “Blocked Person”):

 

(i) a Person that is listed in the annex to, or is otherwise subject to the
provisions of, the Executive Order No. 13224;

 

(ii) a Person owned or controlled by, or acting for or on behalf of, any Person
that is listed in the annex to, or is otherwise subject to the provisions of,
the Executive Order No. 13224;

 

(iii) a Person or entity with which any Lender is prohibited from dealing or
otherwise engaging in any transaction by any Anti-Terrorism Law;

 

(iv) a Person or entity that commits, threatens or conspires to commit or
supports “terrorism” as defined in the Executive Order No. 13224;

 

(v) a Person or entity that is named as a “specially designated national” on the
most current list published by the U.S. Treasury Department Office of Foreign
Asset

 

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Control at its official website or any replacement website or other replacement
official publication of such list, or

 

(vi) a Person or entity who is affiliated or associated with a person or entity
listed above.

 

No Loan Party and, to the knowledge of any Loan Party, none of its agents acting
in any capacity in connection with the Loans, Letters of Credit or other
transactions hereunder (i) conducts any business or engages in making or
receiving any contribution of funds, goods or services to or for the benefit of
any Blocked Person, or (ii) deals in, or otherwise engages in any transaction
relating to, any property or interests in property blocked pursuant to the
Executive Order No. 13224.

 

6.1.28 Solvency.

 

The Borrower and the other Loan Parties, taken as a whole, are Solvent. On the
Closing Date, at the time of each borrowing of the Loans, the issuance of the
Letters of Credit (including extensions, renewals and amendments thereof) and at
the time of selection of, renewal of or conversion to an Interest Rate Option,
the Borrower and the other Loan Parties, taken as a whole, shall be Solvent
after giving effect to the transactions contemplated by the Loan Documents and
any incurrence of Indebtedness and all other Obligations.

 

6.1.29 Permit Blockage.

 

No Loan Party has been barred for a period in excess of fourteen (14)
consecutive days from receiving surface mining or underground mining permits
pursuant to the permit block provisions of the Surface Mining Control and
Reclamation Act, 30 U.S.C. §§ 1201 et seq., and the regulations promulgated
thereto, or any corresponding state laws or regulations.

 

6.2 Updates to Schedules.

 

Should any of the information or disclosures provided on any of the Schedules
attached hereto become outdated or incorrect in any material respect, the
Borrower shall promptly provide the Paying Agent in writing with such revisions
or updates to such Schedule as may be necessary or appropriate to update or
correct same; provided, however, that no Schedule shall be deemed to have been
amended, modified or superseded by any such correction or update, nor shall any
breach of warranty or representation resulting from the inaccuracy or
incompleteness of any such Schedule be deemed to have been cured thereby, unless
and until the Co-Administrative Agents, in their reasonable discretion, shall
have accepted in writing such revisions or updates to such Schedule.

 

7. CONDITIONS OF LENDING AND ISSUANCE OF LETTERS OF CREDIT

 

The obligation of the Revolving Lenders to make Revolving Credit Loans, of the
Tranche B Lenders to fund their Tranche B Credit-Linked Deposits and of the
Issuing Bank to issue Letters of Credit hereunder is subject to the performance
by each of the Loan Parties of its

 

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Obligations to be performed hereunder at or prior to the making of any such
Revolving Credit Loans, funding of the Tranche B Credit-Linked Deposits or
issuance of such Letters of Credit and to the satisfaction of the following
further conditions:

 

7.1 First Loans, Funding of Tranche B Credit-Linked Deposits and Letters of
Credit.

 

On the Closing Date:

 

7.1.1 Officer’s Certificate.

 

The representations and warranties of each of the Loan Parties contained in
Section 6 [Representations and Warranties] and in each of the other Loan
Documents shall be true and accurate on and as of the Closing Date with the same
effect as though such representations and warranties had been made on and as of
such date (except representations and warranties which relate solely to an
earlier date or time, which representations and warranties shall be true and
correct on and as of the specific dates or times referred to therein), and each
of the Loan Parties shall have performed and complied with all covenants and
conditions hereof and thereof, no Event of Default or Potential Default shall
have occurred and be continuing or shall exist; and there shall be delivered to
the Paying Agent for the benefit of each Lender a certificate of each of the
Loan Parties, dated the Closing Date and signed by a Responsible Officer of each
of the Loan Parties, to each such effect.

 

7.1.2 Secretary’s Certificate.

 

There shall be delivered to the Paying Agent for the benefit of each Lender a
certificate dated the Closing Date and signed by the Secretary or an Assistant
Secretary of each of the Loan Parties, certifying as appropriate as to:

 

(i) due authorization of all action taken by such Loan Party in connection with
this Agreement and the other Loan Documents;

 

(ii) the names of the officer or officers authorized to sign this Agreement and
the other Loan Documents and the true signatures of such officer or officers and
specifying the Authorized Officers permitted to act on behalf of such Loan Party
for purposes of this Agreement and the true signatures of such officers, on
which the Paying Agent, each Co-Administrative Agent and each Lender may
conclusively rely; and

 

(iii) copies of its organizational documents, including its certificate of
incorporation, bylaws, certificate of limited partnership, partnership
agreement, certificate of formation, and limited liability company agreement as
in effect on the Closing Date certified by the appropriate state official where
such documents are filed in a state office together with certificates from the
appropriate state officials as to the continued existence and good standing of
such Loan Party in each state where organized or qualified to do business and a
bring-down certificate by facsimile dated no later than ten (10) Business Days
before the Closing Date.

 

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7.1.3 Delivery of Loan Documents.

 

The Collateral Trust Agreement, Guaranty Agreement, Indemnity, Mortgages, Ship
Mortgages, Notes, Patent, Trademark and Copyright Assignment, Pledge Agreement,
Intercompany Subordination Agreement, and Security Agreement shall have been
duly executed and delivered to the Paying Agent for the benefit of the Lenders,
together with all appropriate financing statements and appropriate stock powers
and certificates evidencing the shares, the Partnership Interests and the LLC
Interests that are part of the Pledged Collateral.

 

7.1.4 Opinion of Counsel.

 

7.1.4.1 There shall be delivered to the Co-Administrative Agents for the benefit
of each Lender a written opinion of Rowland H. Burns, Senior Counsel for the
Loan Parties (who may rely on the opinions of such other counsel as may be
acceptable to the Co-Administrative Agents), dated the Closing Date and in form
and substance satisfactory to the Co-Administrative Agents and their respective
counsel: (i) as to the matters set forth in Exhibit 7.1.4(A) and (ii) as to such
other matters incident to the transactions contemplated herein as the
Co-Administrative Agents may reasonably request.

 

7.1.4.2 In addition, there shall also be delivered to the Co-Administrative
Agents, for the benefit of each Lender, a written opinion of McGuire Woods LLP
counsel to the Loan Parties (who may rely on the opinions of such other counsel
as may be acceptable to the Co-Administrative Agents), dated the Closing Date
and in form and substance satisfactory to the Co-Administrative Agents and their
respective counsel: (i) as to matters set forth in Exhibit 7.1.4(B) and (ii) as
to such other matters incident to the transactions contemplated herein as the
Co-Administrative Agents may reasonably request.

 

7.1.4.3 In addition, there shall also be delivered to the Co-Administrative
Agents, for the benefit of each Lender, written opinions of local counsel
selected by the Loan Parties and reasonably acceptable to the Co-Administrative
Agents regarding real estate and other matters, dated the Closing Date and in
form and substance reasonably satisfactory to the Co-Administrative Agents and
their respective counsel: (i) as to matters set forth in Exhibit 7.1.4(C) and
(ii) as to such other matters incident to the transactions contemplated herein
as the Co-Administrative Agents may reasonably request.

 

7.1.4.4 In addition, there shall also be delivered to the Co-Administrative
Agents, for the benefit of each Lender, a written opinion of Piper Rudnick LLP,
bond counsel to the Loan Parties (who may rely on the opinions of such other
counsel as may be acceptable to the Co-Administrative Agents), dated the Closing
Date and in form and substance satisfactory to the Co-Administrative Agents and
their respective counsel: (i) as to matters set forth in Exhibit 7.1.4(D) and
(ii) as to such other matters incident to the transactions contemplated herein
as the Co-Administrative Agents may reasonably request.

 

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7.1.5 Legal Details.

 

All legal details and proceedings in connection with the transactions
contemplated by this Agreement and the other Loan Documents shall be in form and
substance satisfactory to the Co-Administrative Agents and their respective
counsel, and the Paying Agent shall have received all such other counterpart
originals or certified or other copies of such documents and proceedings in
connection with such transactions, in form and substance satisfactory to the
Co-Administrative Agents and their respective counsel, as the Co-Administrative
Agents or their respective counsel may reasonably request.

 

7.1.6 Payment of Fees.

 

The Borrower shall have paid or caused to be paid to the Paying Agent and any
Co-Administrative Agents for themselves and for the account of the Lenders to
the extent not previously paid, all commitment and other fees accrued through
the Closing Date and the costs and expenses for which the Paying Agent, any
Co-Administrative Agents and the Lenders are entitled to be reimbursed.

 

7.1.7 Independent Business and Mining Plan Review; Valuation of Major Assets;
Environmental Assessment and Certificate.

 

7.1.7.1 The Co-Administrative Agents shall have received a written report
prepared by John T. Boyd Company in form, substance and scope reasonably
acceptable to the Co-Administrative Agents and the Lenders, that includes: (i) a
confirmation of the general reasonableness of the Borrower’s five (5) year
business plan in light of, among other things, the Coal reserves, Coal quality,
current mining practices, technology, markets, and employee and environmental
liabilities associated with the Borrower’s and the other Loan Parties’ Coal and
methane gas properties, (ii) a valuation (on a desktop basis) of the major
operating assets of the Borrower and the other Loan Parties, including, without
limitation, a valuation of the Coal (in mines and in reserves) and the methane
gas (available for production and in reserves) of the Borrower and the other
Loan Parties, (iii) an environmental assessment with respect to the Real
Property, and (iv) such other matters as the Co-Administrative Agents may
reasonably request.

 

7.1.7.2 On the Closing Date the Responsible Officers of each of the Loan Parties
shall have delivered to the Co-Administrative Agents, in form and substance
satisfactory to the Co-Administrative Agents, a certificate to the effect that
except in each case where any such Contamination or Environmental Complaint
individually or in the aggregate, would have no reasonable likelihood of
materially disrupting the Gas and Coal Operations or materially diminishing the
fair market value of the Collateral, taken as a whole, or otherwise resulting in
a Material Adverse Change, the Loan Parties have made known to the
Co-Administrative Agents all information known to the Responsible Officers of
the Loan Parties concerning Contamination and Environmental Complaints and the
Loan Parties’ compliance with the Environmental Laws relating to any of the
Property and any other site for which any Loan Party has received notice that it
is potentially responsible for Contamination.

 

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7.1.8 Officer’s Certificate Regarding MACs.

 

Since December 31, 2003, no Material Adverse Change shall have occurred; prior
to the Closing Date, there shall have been no material change in the management
of any Loan Party; and there shall have been delivered to the Paying Agent for
the benefit of each Lender a certificate dated the Closing Date and signed by a
Responsible Officer of each Loan Party to each such effect.

 

7.1.9 No Violation of Laws.

 

The making of the Loans and the issuance of the Letters of Credit shall not
contravene any Law applicable to any Loan Party or any of the Lenders.

 

7.1.10 No Actions or Proceedings.

 

No action, proceeding, investigation, regulation or legislation shall have been
instituted, or, to the knowledge of any Responsible Officer threatened or
proposed before any court, governmental agency or legislative body to enjoin,
restrain or prohibit, or to obtain damages in respect of, this Agreement, the
other Loan Documents or the consummation of the transactions contemplated hereby
or thereby or which, in the sole discretion of the Co-Administrative Agents,
would make it inadvisable to consummate the transactions contemplated by this
Agreement or any of the other Loan Documents.

 

7.1.11 Insurance Policies; Certificates of Insurance; Endorsements.

 

The Loan Parties shall have delivered evidence acceptable to the
Co-Administrative Agents that adequate insurance in compliance with Section
8.1.3 [Maintenance of Insurance] is in full force and effect and that all
premiums then due thereon have been paid, together with a certificate in a
standard industry form naming the Collateral Trustee on behalf of the Secured
Parties as additional insured on the liability policies and mortgagee and lender
loss payee.

 

7.1.12 Filing Receipts.

 

The Co-Administrative Agents shall have received (1) copies of all filing
receipts and acknowledgments issued by any governmental authority to evidence
any recordation or filing necessary to perfect the Lien of the Collateral
Trustee for the benefit of the Secured Parties on the Collateral or other
satisfactory evidence of such recordation and filing and (2) evidence in a form
acceptable to the Co-Administrative Agents that such Lien constitutes a Prior
Security Interest in favor of the Collateral Trustee for the benefit of the
Secured Parties and, in the case of each Mortgage, a valid and perfected first
priority Lien.

 

7.1.13 Administrative Questionnaire.

 

Each of the Lenders shall have completed and delivered to the Paying Agent the
Paying Agent’s form of administrative questionnaire.

 

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7.1.14 UCC, Lien and Judgment Searches.

 

The Paying Agent shall have received searches under the Uniform Commercial Code,
lien, tax lien, litigation and judgment searches against each Loan Party and
each Person pledging or required to pledge ownership interests in any Loan
Party, in each case in the jurisdiction of each such Person’s formation and in
each jurisdiction where a perfected lien or security interest could legally be
filed against the Collateral and the results of such searches shall be
satisfactory in form, scope and substance to the Co-Administrative Agents.

 

The Loan Parties shall deliver record owner and lien title reports acceptable to
the Co-Administrative Agents, confirming the applicable Loan Parties’ fee simple
title to, or leasehold interest in, such portions of the Real Property as the
Co-Administrative Agents shall request and all improvements and all
appurtenances thereto (including such easements and appurtenances as may be
required by the Co-Administrative Agents), free and clear of any and all defects
and encumbrances whatsoever, subject only to such exceptions as may be approved
in writing by the Co-Administrative Agents.

 

7.1.15 Solvency.

 

The Loan Parties shall have delivered a certificate duly executed by a
Responsible Officer of each Loan Party acceptable to the Co-Administrative
Agents in substantially the form of Exhibit 7.1.15 that, as of the Closing Date
and after giving effect to the transactions contemplated by the Loan Documents,
including the Loans to be made and the Letters of Credit to be issued on the
Closing Date, the Loan Parties, taken as a whole, are Solvent.

 

7.1.16 Financial Statements and Financial Projections.

 

The Borrower shall have delivered to the Co-Administrative Agents and the
Lenders the Historical Statements, the Financial Projections and a certificate,
signed by a Responsible Officer of the Borrower and certifying that (i) neither
the Borrower nor any other Loan Party has any material liabilities, contingent
or otherwise, or forward or long-term commitments that are not disclosed in the
Historical Statements or in the notes thereto and (ii) except as disclosed in
the Historical Statements, there are no unrealized or anticipated losses from
any commitments of the Borrower or any other Loan Party that would reasonably be
expected to cause a Material Adverse Change. Such Historical Statements,
Financial Projections and certifications shall be in form and substance
satisfactory to the Co-Administrative Agents and the Lenders.

 

7.1.17 ERISA; Other Due Diligence.

 

The Co-Administrative Agents and the Lenders shall have completed or shall have
caused to be completed, to their satisfaction in form, scope, substance and in
all other respects, a due diligence review with respect to the assets, financial
condition, operations, business and prospects of the Borrower and each of the
other Loan Parties, including a review, without limitation of the books and
records of the Borrower and each of the other Loan Parties,

 

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the Annual Statements and related Form-10-K filed with the Securities and
Exchange Commission for the fiscal year ended December 31, 2003, the Interim
Statements, the Financial Projections, and, all tax, ERISA, employee retirement
benefit, and the contingent liabilities to which the Borrower and any other Loan
Party may be subject.

 

7.1.18 Termination of Existing Credit Agreement and Designated Letter of Credit
Facility.

 

The following shall occur to the satisfaction of the Co-Administrative Agents in
their sole discretion:

 

(i) all principal, interest, fees and other liabilities and obligations under
the Existing Credit Agreement and the Designated Letter of Credit Facility shall
be repaid in full except for the Existing Letters of Credit that are being made
subject to the terms of this Agreement;

 

(ii) all liens and security interests securing the Existing Credit Agreement and
the Designated Letter of Credit Facility shall have been terminated of record or
arrangements, reasonably satisfactory to the Co-Administrative Agents, to
terminate such liens and security interests shall have been made; and

 

(iii) all commitments to lend under the Existing Credit Agreement and the
Designated Letter of Credit Facility shall have been irrevocably terminated and
of no further force and effect.

 

7.1.19 Collateral Trust Agreement.

 

The Collateral Trust Agreement shall have been duly executed and delivered and
shall, among other matters, provide for an equal and ratable sharing of the
Shared Collateral, on a pari-passu basis, among (i) the Obligations, (ii) the
indebtedness represented by the Senior Notes (1991), and (iii) the indebtedness
represented by the Senior Notes (2002).

 

7.2 Each Additional Loan or Letter of Credit.

 

At the time of making any Loans or issuing any Letters of Credit (or amendments
or extensions thereto) other than Loans made or Letters of Credit issued on the
Closing Date and after giving effect to the proposed extensions of credit: the
representations and warranties of the Loan Parties contained in Section 6
[Representations and Warranties] and in the other Loan Documents shall be true
on and as of the date of any Loan Request, any Swing Loan Request, and the
making of such additional Loan or the issuance such Letter of Credit (or
amendments or extensions thereto) with the same effect as though such
representations and warranties had been made on and as of such date (except
representations and warranties which expressly relate solely to an earlier date
or time, which representations and warranties shall be true and correct on and
as of the specific dates or times referred to therein) and the Loan Parties
shall have performed and complied with all covenants and conditions hereof; no
Event of Default or Potential Default shall have occurred and be continuing or
shall exist; the making of the Loans or issuance of such Letter of Credit (or
amendments or extensions thereto) shall not contravene any

 

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Law applicable to any Loan Party or any of the Lenders; and the Borrower shall
have delivered to the Paying Agent a duly executed and completed Loan Request or
application for a Letter of Credit as the case may be.

 

8. COVENANTS

 

8.1 Affirmative Covenants.

 

The Loan Parties, jointly and severally, covenant and agree that until payment
in full of the Loans, Reimbursement Obligations and Revolving Letter of Credit
Borrowings, and interest thereon, expiration or termination of all Letters of
Credit, return of the Tranche B Credit-Linked Deposits and satisfaction of all
of the Loan Parties’ other Obligations under the Loan Documents and termination
of the Commitments, the Loan Parties shall comply at all times with the
following affirmative covenants:

 

8.1.1 Preservation of Existence, Etc.

 

Each Loan Party shall maintain its legal existence as a corporation, limited
partnership or limited liability company and its license or qualification and
good standing in each jurisdiction in which its failure to so qualify,
individually or in the aggregate, would reasonably be expected to result in a
Material Adverse Change, except as otherwise expressly permitted in Section
8.2.6 [Liquidations, Mergers, Etc.].

 

8.1.2 Payment of Liabilities, Including Taxes, Etc.

 

Each Loan Party shall duly pay and discharge all liabilities to which it is
subject or which are asserted against it, promptly as and when the same shall
become due and payable, including all taxes, assessments and governmental
charges upon it or any of its properties, assets, income or profits, prior to
the date on which penalties attach thereto, except to the extent that such
liabilities, including taxes, assessments or charges, are being contested in
good faith and by appropriate and lawful proceedings diligently conducted and
for which such reserve or other appropriate provisions, if any, as shall be
required by GAAP shall have been made, but only to the extent that failure to
discharge any such liabilities would not result in any additional liability
which would adversely affect to a material extent the financial condition of the
Loan Parties, taken as a whole, or which would materially affect the Collateral,
provided that the Loan Parties will pay all such liabilities forthwith upon the
commencement of proceedings to enforce any Lien which may have attached as
security therefore or take other action as is required to suspend such
enforcement action.

 

8.1.3 Maintenance of Insurance.

 

Each Loan Party shall insure its properties and assets against loss or damage by
fire and such other insurable hazards as such assets are commonly insured
(including flood, fire, property damage, workers’ compensation and public
liability insurance) and against other risks (including errors and omissions) in
such amounts as similar properties and assets are insured by prudent companies
in similar circumstances carrying on similar businesses, and with

 

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reputable and financially sound insurers, including self-insurance to the extent
customary. At the request of the Paying Agent, the Loan Parties shall deliver to
the Paying Agent and each of the Lenders (x) on the Closing Date and annually
thereafter an original certificate of insurance signed by the Loan Parties’
independent insurance broker describing and certifying as to the existence of
the insurance on the Collateral required to be maintained by this Agreement and
the other Loan Documents, together with a copy of the endorsement described in
the next sentence attached to such certificate and (y) from time to time a
summary schedule indicating all commercial insurance then in force with respect
to each of the Loan Parties. Such policies of insurance shall contain the
necessary endorsements or policy language, which shall (i) specify the
Collateral Trustee on behalf of the Secured Parties as an additional insured on
the liability policies and mortgagee and lender loss payee as their interests
may appear, with the understanding that any obligation imposed upon the insured
(including the liability to pay premiums) shall be the sole obligation of the
applicable Loan Parties and not that of the additional insured, (ii) provide
that the interest of the Lenders, under the lender’s loss payable endorsement in
a form similar to the form provided on the Closing Date, shall be insured
regardless of any breach or violation by the applicable Loan Parties of any
warranties, declarations or conditions contained in such policies or any action
or inaction of the applicable Loan Parties, (iii) provide a waiver of any right
of the insurers to set off or counterclaim or any other deduction, whether by
attachment or otherwise (to the extent that the Loan Parties are able on a
reasonable efforts basis to obtain such waiver from the insurers), (iv) provide
that no cancellation of such policies for any reason (including non-payment of
premium) nor any change therein shall be effective until at least ten (10) days
after notification to the Paying Agent of such cancellation or change, (v) be
primary without right of contribution of any other liability insurance carried
by or on behalf of any additional insureds with respect to their respective
interests in the Collateral, and (vi) provide that inasmuch as any liability
policy covers more than one insured, all terms, conditions, insuring agreements
and endorsements (except limits of liability) shall operate as if there were a
separate policy covering each insured. The Loan Parties shall maintain all flood
insurance policies of a type and in an amount as carried by the Loan Parties on
the Closing Date. If a Casualty Event occurs, the Borrower shall promptly notify
the Paying Agent of such event and the estimated (or actual, if available)
amount of such loss.

 

8.1.4 Maintenance of Properties and Leases.

 

Each Loan Party shall maintain in good repair, working order and condition
(ordinary wear and tear excepted) in accordance with the general practice of
other businesses of similar character and size, all of those material properties
useful or necessary to its business, and from time to time, such Loan Party will
make or cause to be made, in a reasonably diligent fashion, all appropriate
repairs, renewals or replacements thereof.

 

8.1.5 Maintenance of Patents, Trademarks, Etc.

 

Each Loan Party shall maintain in full force and effect all patents, trademarks,
service marks, trade names, copyrights, licenses, franchises, permits and other
authorizations necessary for the ownership and operation of its properties and
business if the failure so to maintain the same would constitute a Material
Adverse Change.

 

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8.1.6 Visitation Rights; Field Examinations.

 

Each Loan Party shall permit any of the officers or authorized employees or
representatives of the Paying Agent or any of the Lenders (so long as no Event
of Default has occurred and is continuing, at such Paying Agent’s or Lender’s
expense) to visit and inspect any of its properties during normal business hours
and to examine (including, without limitation, any field examinations) and make
excerpts from its books and records and discuss its business affairs, finances
and accounts with its officers, all in such detail and at such times and as
often as any of the Lenders may reasonably request, provided that each Lender
shall provide the Borrower and the Paying Agent with reasonable notice prior to
any visit or inspection, all such visits and inspections shall be made in
accordance with such Loan Party’s standard safety, visit and inspection
procedures and no such visit or inspection shall interfere with such Loan
Party’s normal business operation. In the event any Lender desires to conduct an
audit of any Loan Party, such Lender shall make a reasonable effort to conduct
such audit contemporaneously with any audit to be performed by the Paying Agent.

 

8.1.7 Keeping of Records and Books of Account.

 

The Borrower and each other Loan Party shall maintain and keep proper books of
record and account which enable the Borrower to issue financial statements in
accordance with GAAP and as otherwise required by applicable Laws of any
Official Body having jurisdiction over the Borrower or any other Loan Party, and
in which full, true and correct entries shall be made in all material respects
of all its dealings and business and financial affairs. Without limiting the
generality of the foregoing, the Loan Parties shall maintain adequate allowances
on its books in accordance with GAAP for (i) future costs associated with any
lung disease claim alleging pneumoconiosis or silicosis or arising out of
exposure or alleged exposure to coal dust or the coal mining environment, (ii)
future costs associated with retiree and health care benefits, (iii) future
costs associated with reclamation of disturbed acreage, removal of facilities
and other closing costs in connection with its mining activities and (iv) future
costs associated with other potential environmental liabilities.

 

8.1.8 Plans and Benefit Arrangements.

 

The Borrower shall, and shall cause each other member of the ERISA Group to,
comply with ERISA, the Internal Revenue Code and other applicable Laws
applicable to Plans and Benefit Arrangements except where such failure, alone or
in conjunction with any other failure, would not result in a Material Adverse
Change. Without limiting the generality of the foregoing, the Borrower shall
cause all of its Plans and all Plans maintained by any member of the ERISA Group
to be funded in accordance with the minimum funding requirements of ERISA and
shall make, and cause each member of the ERISA Group to make when due, including
the application of any grace period, all contributions due to Plans, Benefit
Arrangements and Multiemployer Plans.

 

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8.1.9 Compliance with Laws.

 

Each Loan Party shall comply with all applicable Laws, including all
Environmental Laws, in all material respects, provided that it shall not be
deemed to be a violation of this Section 8.1.9 if any failure to comply with any
Law would not result in fines, penalties, remediation costs, other similar
liabilities or injunctive relief which in the aggregate would reasonably be
expected to result in a Material Adverse Change.

 

8.1.10 Use of Proceeds.

 

The Loan Parties will use the Letters of Credit and the proceeds of the Loans
only for general corporate purposes of the Loan Parties, including, without
limitation, working capital, Permitted Acquisitions, and capital expenditures of
the Loan Parties. The Loan Parties shall not use the Letters of Credit or the
proceeds of the Loans for any purposes which contravenes any applicable Law or
any provision hereof.

 

8.1.11 Further Assurances.

 

Each Loan Party shall, from time to time, at its expense, faithfully preserve
and protect the Lien on and Prior Security Interest in the Collateral in favor
of the Collateral Trustee for the benefit and of the Secured Parties as a
continuing first priority perfected Lien, subject only to Permitted Liens, and
shall do such other acts and things as the Paying Agent in its reasonable
discretion may deem necessary or advisable from time to time in order to
preserve, perfect and protect the Liens granted under the Loan Documents and to
exercise and enforce the Collateral Trustee’s rights and remedies thereunder
with respect to the Collateral.

 

8.1.12 Subordination of Intercompany Loans.

 

Each Loan Party shall cause any intercompany Indebtedness, loans or advances
owed by any Loan Party to any other Loan Party to be subordinated pursuant to
the terms of the Intercompany Subordination Agreement.

 

8.1.13 Tax Shelter Regulations.

 

None of the Loan Parties intends to treat the Loans and/or Letters of Credit and
related transactions as being a “reportable transaction” (within the meaning of
Treasury Regulation Section 1.6011-4). In the event any of the Loan Parties
determines to take any action inconsistent with such intention, the Borrower
will promptly (1) notify the Paying Agent thereof, and (2) deliver to the Paying
Agent a duly completed copy of IRS Form 8886 or any successor form. If the
Borrower so notifies the Paying Agent, the Borrower acknowledges that one or
more of the Lenders may treat its Loans and/or Letters of Credit as part of a
transaction that is subject to Treasury Regulation Section 301.6112-1, and such
Lender or Lenders, as applicable, will maintain the lists and other records
required by such Treasury Regulation.

 

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8.1.14 Anti-Terrorism Laws.

 

The Loan Parties shall not (i) knowingly conduct any business or engage in any
transaction or dealing with any Blocked Person, including the making or
receiving any contribution of funds, goods or services to or for the benefit of
any Blocked Person, (ii) deal in, or otherwise engage in any transaction
relating to, any property or interests in property blocked pursuant to the
Executive Order No. 13224; or (iii) engage in or conspire to engage in any
transaction that evades or avoids, or has the purpose of evading or avoiding, or
attempts to violate, any of the prohibitions set forth in the Executive Order
No. 13224, the USA Patriot Act or any other Anti-Terrorism Law. The Borrower
shall deliver to Lenders certification confirming Borrower’s compliance with
this Section 8.1.14.

 

8.1.15 Maintenance of Coal Supply Agreements and Material Contracts.

 

Each Loan Party shall maintain and materially comply with the terms and
conditions of all coal supply agreements and Material Contracts, the
nonperformance of which would reasonably be expected to result in a Material
Adverse Change.

 

8.1.16 Collateral.

 

Except for the assets described on Schedule 8.1.16 and any stock or assets
acquired in a Permitted Acquisition and encumbered by a Lien permitted by
clauses (xiii) or (xv) of the definition of Permitted Liens, pursuant to the
Loan Documents, the Loan Parties shall grant, or cause to be granted, to the
Collateral Trustee, for the benefit of the Secured Parties, a first priority
security interest in and lien on, subject only to Permitted Liens, (i) all
capital stock owned by the Loan Parties (but only up to 65% of the capital stock
of the Foreign Subsidiaries and none of the capital stock of the other Excluded
Subsidiaries) and (ii) all of the assets of the Loan Parties including all
accounts, inventory, as-extracted collateral, fixtures, equipment, investment
property, instruments, chattel paper, general intangibles, Coal reserves,
methane gas reserves, coal bed methane reserves, mineral rights, owned and
leased Real Property, leasehold interests, patents and trademarks of each of the
Loan Parties whether owned on the Closing Date or subsequently acquired.

 

8.1.17 Debt Rating.

 

The Borrower shall maintain a Debt Rating with Standard & Poor’s and Moody’s.

 

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8.2 Negative Covenants.

 

The Loan Parties, jointly and severally, covenant and agree that until payment
in full of the Loans, Reimbursement Obligations and Revolving Letter of Credit
Borrowings, return of the Tranche B Credit-Linked Deposits and interest thereon,
expiration or termination of all Letters of Credit, satisfaction of all of the
Loan Parties’ other Obligations hereunder and termination of the Commitments,
the Loan Parties shall comply with the following negative covenants:

 

8.2.1 Indebtedness.

 

None of the Loan Parties shall at any time create, incur, assume or suffer to
exist any Indebtedness, except:

 

(i) Indebtedness under the Loan Documents;

 

(ii) existing Indebtedness as set forth on Schedule 8.2.1 (including any
extensions or renewals thereof which extend the term of such Indebtedness beyond
the Tranche B Maturity Date, provided there is no increase in the amount of such
Indebtedness or other significant change in the terms thereof);

 

(iii) Indebtedness secured by Purchase Money Security Interests not exceeding
$25,000,000;

 

(iv) Indebtedness of any Loan Party payable to any other Loan Party so long as
such Indebtedness is subordinated in accordance with the provisions of Section
8.1.12 [Subordination of Intercompany Loans];

 

(v) Indebtedness incurred in connection with any Swap Transaction;

 

(vi) Indebtedness relating to the Senior Notes (1991);

 

(vii) Indebtedness relating to the Senior Notes (2002);

 

(viii) Indebtedness relating to a Permitted Acquisition that is either:

 

(a) Indebtedness of any Subsidiary acquired in a Permitted Acquisition so long
as: (x) such Indebtedness existed at the time of consummation of such Permitted
Acquisition and (y) such Indebtedness was not incurred in connection with or in
contemplation of such Permitted Acquisition; or

 

(b) Indebtedness incurred in connection with, or in contemplation of, financing
a Permitted Acquisition of not more than $250,000,000 in the aggregate
outstanding at any one time, provided, that the terms and conditions of any such
Indebtedness be reasonably acceptable to the Paying Agent;

 

(ix) Indebtedness secured by Liens permitted by clause (xii) of the definition
of Permitted Liens;

 

(x) Indebtedness secured by a Lien permitted by clauses (vii) or (xvii) of the
definition of Permitted Liens, provided that the aggregate amount of such
secured Indebtedness shall not exceed $250,000,000 at any time, and provided
further, that at the time such secured Indebtedness is incurred, the Loan
Parties can demonstrate pro forma

 

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compliance with the covenants contained in Sections 8.2.17 [Maximum Leverage
Ratio] and 8.2.18 [Minimum Interest Coverage Ratio] (including in such
computations such secured Indebtedness as permitted under this clause);

 

(xi) Indebtedness of the type reflected in clause (k) of the definition of
Indebtedness arising out of or with respect to surety and performance bonds
procured by the Loan Parties in the ordinary course of its business, and
Indebtedness secured by Liens permitted by clauses (i), (ii), (iii) and (iv) of
the definition of Permitted Liens; and

 

(xii) additional unsecured Indebtedness, provided, that at the time such
unsecured Indebtedness is incurred, the Loan Parties can demonstrate pro forma
compliance with the covenants contained in Sections 8.2.17 [Maximum Leverage
Ratio] and 8.2.18 [Minimum Interest Coverage Ratio] (including in such
computations such unsecured Indebtedness as permitted under this clause).

 

8.2.2 Liens.

 

None of the Loan Parties shall at any time create, incur, assume or suffer to
exist any Lien on any of its property or assets, tangible or intangible, now
owned or hereafter acquired, or agree or become liable to do so, except
Permitted Liens.

 

8.2.3 Guaranties.

 

None of the Loan Parties shall at any time, directly or indirectly, become or be
liable in respect of any Guaranty, or assume, guarantee, become surety for,
endorse or otherwise agree, become or remain directly or contingently liable
upon or with respect to any obligation or liability of any other Person, except:

 

(i) any Guaranty by any Loan Party of Indebtedness, liabilities or other
obligations of any other Loan Party under any capital lease or operating lease
under which any Loan Party is the lessee, so long as such lease is permitted by
this Agreement;

 

(ii) any Guaranty by any Loan Party of contingent obligations arising in
connection with any sale or other disposition of assets of any Loan Party
permitted by this Agreement;

 

(iii) any Guaranty by any Loan Party of any Indebtedness of another Loan Party
permitted by Section 8.2.1 [Indebtedness], so long as in the case of the Senior
Notes (1991) and Senior Notes (2002), any Subsidiary of the Borrower which
provides a Guaranty of the Senior Notes (1991) or the Senior Notes (2002) shall
become a Guarantor and join the Guaranty Agreement;

 

(iv) any Guaranty by any Loan Party in support of Investments permitted by
Section 8.2.4(vi) [Loans and Investments];

 

(v) any Guaranty by any Loan Party of any Ordinary Course Obligation of any
other Loan Party;

 

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(vi) any Guaranty by any Loan Party pursuant to the Guaranty Agreement; and

 

(vii) any existing Guaranty of any Loan Party that is set forth on Schedule
8.2.3.

 

8.2.4 Loans and Investments.

 

None of the Loan Parties shall at any time make or suffer to remain outstanding
any Investment or become or remain liable for any Investments, except:

 

(i) trade credit extended on usual and customary terms in the ordinary course of
business;

 

(ii) advances to employees to meet expenses incurred by such employees in the
ordinary course of business, provided that such advances to all such employees
do not exceed an aggregate amount of $5,000,000 outstanding at any time;

 

(iii) Permitted Investments;

 

(iv) Permitted Acquisitions;

 

(v) in connection with the management of employee benefit trust funds of any
Loan Party or any Subsidiary of any Loan Party, investment of such employee
benefit trust funds in investments of a type generally and customarily used in
the management of employee benefit trust funds;

 

(vi) Investments made by the Loan Parties after the Closing Date in all Persons
(other than the Loan Parties) consisting of (A) up to $50,000,000 of Investments
in the aggregate in the form of cash, unpaid loans or advances from the Loan
Parties, and outstanding obligations (whether contingent or otherwise) of the
Loan Parties in connection with Guarantees, (B) Non-Strategic Assets and (C)
other assets so long as the fair market value of such assets plus (without
duplication) all sales, transfers, and dispositions of assets under Section
8.2.7(ix) [Disposition of Assets or Subsidiaries], for the period from the
Closing Date through and including the date of determination, does not exceed
$250,000,000 in the aggregate, provided further that after giving effect to any
such Investment no Event of Default or Potential Default shall exist or shall
result from such Investment; and

 

(vii) Investments existing as of the Closing Date; and

 

(viii) Investments in any Loan Party.

 

8.2.5 Dividends and Related Distributions.

 

None of the Loan Parties shall make or pay, or agree to become or remain liable
to make or pay, any dividend or other distribution of any nature (whether in
cash, property,

 

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securities or otherwise) on account of or in respect of its shares of capital
stock, partnership interests or limited liability company interests on account
of the purchase, redemption, retirement or acquisition of its shares of capital
stock (or warrants, options or rights therefor), partnership interests or
limited liability company interests, except:

 

(i) dividends or other distributions payable to another Loan Party;

 

(ii) so long as Borrower has not achieved and maintained an Investment Grade
rating, dividends payable by the Borrower on common stock issued by the Borrower
of up to $0.56 per share per fiscal year, provided that at the time of any such
dividend payment, no Event of Default or Potential Default shall exist or shall
result from such dividend payment after giving effect thereto;

 

(iii) stock purchases or redemptions in connection with the exercise by
employees or members of the board of directors of any Loan Party of any equity
securities issued pursuant to an employee or board of directions equity
subscription agreement, equity option agreement or equity ownership arrangement
or other compensation plan permitted to be issued hereunder; and

 

(iv) common stock purchases or redemptions, made by the Borrower, of common
stock issued by the Borrower, provided that at the time of any such common stock
purchase or redemption, no Event of Default or Potential Default shall exist or
shall result from such common stock purchase or redemption after giving effect
thereto, provided, further such purchases and redemptions shall be limited to
the sum of (A) an aggregate of $10,000,000 for the period commencing on the
Closing Date through the Tranche B Maturity Date plus (B) for each fiscal year,
the portion of Available Excess Cash Flow that is not used to prepay, purchase,
repurchase, or redeem the Senior Notes (1991) or the Senior Notes (2002) as
permitted by paragraph (a) of Section 8.2.16 [Certain Matters Regarding Senior
Notes, Etc.], provided, that the amount allowed under this clause (B) shall not
exceed 50% of Available Excess Cash Flow in any fiscal year.

 

8.2.6 Liquidations, Mergers, Consolidations, Acquisitions.

 

None of the Loan Parties shall dissolve, liquidate or wind-up its affairs, or
become a party to any merger or consolidation, or acquire by purchase, lease or
otherwise all or substantially all of the assets or capital stock of any other
Person, provided that

 

(1) any Loan Party (other than the Borrower) may consolidate or merge into any
other Loan Party and any Loan Party may consolidate or merge into Borrower,
provided that Borrower is the surviving entity;

 

(2) any Subsidiary of the Borrower (other than any Subsidiary which is a Loan
Party) may consolidate or merge into any other Subsidiary of the Borrower (so
long as the Subsidiary so consolidated or merged with or into is also not a Loan
Party), and

 

(3) any Loan Party may acquire whether by purchase or by merger, (A) all of the
ownership interests of another Person or (B) substantially all of assets of
another

 

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Person or of a business or division of another Person (each an “Permitted
Acquisition”), provided that each of the following requirements is met:

 

(i) if such Loan Party is acquiring the ownership interests in such Person, such
Person shall execute a Guarantor Joinder and join this Agreement as a Guarantor
pursuant to Section 11.18 [Joinder of Guarantors] on or before the date of such
Permitted Acquisition;

 

(ii) subject to the Liens incurred in connection with such Permitted
Acquisition, the Loan Parties shall grant Liens in the assets of or acquired
from and stock or other ownership interests in such Person and otherwise comply
with Section 11.18 [Joinder of Guarantors] on or before the date of such
Permitted Acquisition;

 

(iii) the board of directors or other equivalent governing body of such Person
shall have approved such Permitted Acquisition and, if the Loan Parties shall
use any portion of the Loans to fund such Permitted Acquisition, the Loan
Parties also shall have delivered to the Lenders written evidence of the
approval of the board of directors (or equivalent body) of such Person for such
Permitted Acquisition;

 

(iv) the business acquired, or the business conducted by the Person whose
ownership interests are being acquired, as applicable, shall be substantially
the same as, or shall support or be complimentary to, one or more line or lines
of business conducted by the Loan Parties and shall comply with Section 8.2.10
[Continuation of or Change in Business];

 

(v) no Potential Default or Event of Default shall exist immediately prior to
and after giving effect to such Permitted Acquisition;

 

(vi) (A) the pro forma Leverage Ratio (including in such computation
Indebtedness incurred in connection with such Permitted Acquisition and
including income earned or expenses incurred by the Person, business or assets
to be acquired prior to the date of such Permitted Acquisition) is less than 2.0
to 1.0 after taking into account such Permitted Acquisition or (B) if the pro
forma Leverage Ratio (including in such computation Indebtedness incurred in
connection with such Permitted Acquisition and including income earned or
expenses incurred by the Person, business or assets to be acquired prior to the
date of such Permitted Acquisition) is 2.0 to 1.0 or higher after taking into
account such Permitted Acquisition, the aggregate Consideration to be paid by
the Loan Parties for such Permitted Acquisition plus the Consideration paid for
all other Permitted Acquisitions made between the Closing Date and the date of
such Permitted Acquisition shall not exceed $100,000,000;

 

(vii) the Loan Parties shall deliver to the Paying Agent at least five (5)
Business Days before such Permitted Acquisition: (A) a certificate of the
Borrower in substantially the form of Exhibit 8.2.6 evidencing (x) pro forma
compliance with the covenants contained in Sections 8.2.17 [Maximum Leverage
Ratio] and 8.2.18 [Minimum Interest Coverage Ratio] (including in such
computations Indebtedness incurred in

 

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connection with such Permitted Acquisition and including income earned or
expenses incurred by the Person, business or assets to be acquired prior to the
date of such Permitted Acquisition) and (y) that the Borrower shall have, after
giving effect to such Permitted Acquisition, at least $50,000,000 of
Availability, and (B) if the Consideration of such Permitted Acquisition is in
excess of $10,000,000 copies of any agreements entered into or proposed to be
entered into by such Loan Parties in connection with such Permitted Acquisition
and shall deliver to the Paying Agent such other information about such Person
or its assets as the Paying Agent may reasonably require.

 

8.2.7 Dispositions of Assets or Subsidiaries.

 

None of the Loan Parties shall sell, convey, assign, lease, sell and leaseback,
abandon or otherwise transfer or dispose of, voluntarily or involuntarily, any
of its properties or assets, tangible or intangible (including sale, assignment,
discount or other disposition of Accounts, equipment or general intangibles with
or without recourse or of capital stock, shares of beneficial interest,
partnership interests or limited liability company interests of a Subsidiary of
such Loan Party), except:

 

(i) transactions involving the sale of inventory in the ordinary course of
business;

 

(ii) any sale, transfer or lease of assets in the ordinary course of business
which are no longer necessary or required in the conduct of such Loan Party’s
business;

 

(iii) any sale, transfer or lease of assets by any Loan Party to another Loan
Party;

 

(iv) any sale, transfer or lease of assets, so long as (A) within two hundred
and seventy (270) days following any such sale, transfer or lease, the assets
that were the subject thereof are replaced by or subject to contractual
obligation for the replacement by, substitute, replacement or other assets of
the type used in any Loan Party’s business, and (B) all such substitute assets
are subject to the Collateral Trustee’s Prior Security Interest for the benefit
of the Secured Parties; provided that the fair market value of all assets sold,
transferred or leased under this clause in any given fiscal year shall not
exceed $250,000,000;

 

(v) any sale of Accounts or contracts giving rise to Accounts pursuant to the
Permitted Receivables Financing by the Securitization Subsidiary, provided that
at the time of any such sale no Event of Default shall exist or shall result
from such sale after giving effect thereto;

 

(vi) any sale of Accounts arising from the export outside of the U.S. of goods
or services by any Loan Party, provided that at the time of any such sale, no
Event of Default or Potential Default shall exist or shall result from such sale
after giving effect thereto;

 

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(vii) any lease, sublease or license of assets (with a Loan Party as the lessor,
sublessor or licensor) in the ordinary course of business, provided that the
interests of the Loan Parties in any such lease, sublease or license are subject
to the Lenders’ Prior Security Interest;

 

(viii) a sale, transfer or lease of assets generally referred to as Coal
Mountain by the Loan Parties, pending as of the Closing Date; and

 

(ix) any sale, transfer or lease of assets, other than those specifically
excepted pursuant to clauses (i) through (viii) above, so long as (A) the sum of
(1) the Net Cash Proceeds of such sale, plus (2) all other Net Cash Proceeds
from sales, transfers or leases of assets calculated for the period from the
Closing Date through and including the date of determination, does not exceed an
aggregate amount of $250,000,000 less the fair market value of assets
contributed in the form of Investments pursuant to Section 8.2.4(vi)(C)
subsequent to the Closing Date, and (B) notification of any such sale, transfer
or lease of assets shall be included within the Borrower’s Compliance
Certificate delivered pursuant to Section 8.3.4 [Certificate of the Borrower]
for each fiscal quarter in which any such sale, transfer or lease of assets has
occurred.

 

8.2.8 Affiliate Transactions.

 

Each of the Loan Parties shall not enter into or carry out any transaction with
any Affiliate thereof (including purchasing property or services from or selling
property or services to any Affiliate of any Loan Party or other Person) unless
(i) such transaction is not otherwise prohibited by this Agreement, and (ii)
such transaction either (a) would be entered into by a prudent Person in the
position of such Loan Party or (b) is entered into upon fair and reasonable
arm’s-length terms and conditions which are fully disclosed to the Paying Agent
and is in accordance with all applicable Law.

 

8.2.9 Subsidiaries, Partnerships and Joint Ventures.

 

None of the Loan Parties shall own or create directly or indirectly any
Subsidiaries other than (i) Excluded Subsidiaries, provided that with respect to
each Foreign Subsidiary owned by a Domestic Loan Party, then 65% of the capital
stock of such Foreign Subsidiary owned by a Domestic Loan Party shall be pledged
to the Collateral Trustee for the benefit of the Secured Parties as required in
accordance with Section 8.1.16 [Collateral]; (ii) any Subsidiary (other than
Excluded Subsidiaries) that has joined this Agreement as a Guarantor on the
Closing Date; and (iii) any Subsidiary formed or acquired after the Closing Date
that joins this Agreement as a Guarantor by complying with the procedures set
forth in Section 11.18 [Joinder of Guarantors], provided that such Subsidiary
and the Loan Parties, as applicable, shall grant and cause to be perfected first
priority Liens, subject to Permitted Liens, to the Collateral Trustee for the
benefit of the Secured Parties in the assets held by, and stock of or other
ownership interests in, such Subsidiary. Except in connection with an Investment
permitted by Section 8.2.4(vi), 8.2.4(vii), and 8.2.4(viii), none of the Loan
Parties shall become or agree to (1) become a general partner in any general or
limited partnership, (2) become a member or manager of, or hold a

 

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limited liability company interest in, a limited liability company, or (3)
become a joint venturer or hold a joint venture interest in any joint venture.

 

8.2.10 Continuation of or Change in Business.

 

None of the Loan Parties shall engage in any business other than the business of
the Loan Parties and their Subsidiaries, substantially as conducted and operated
by the Loan Parties and their Subsidiaries, taken as a whole, as of the Closing
Date or business that supports or is complimentary to such business, and the
Loan Parties shall not permit any material change in the nature of such
business.

 

8.2.11 Plans and Benefit Arrangements.

 

None of the Loan Parties shall:

 

(i) fail to satisfy the minimum funding requirements of ERISA and the Internal
Revenue Code with respect to any Plan;

 

(ii) request a minimum funding waiver from the Internal Revenue Service with
respect to any Plan;

 

(iii) engage in a Prohibited Transaction with any Plan, Benefit Arrangement or
Multiemployer Plan which, alone or in conjunction with any other circumstances
or set of circumstances resulting in liability under ERISA, would constitute a
Material Adverse Change;

 

(iv) [Intentionally Omitted.]

 

(v) fail to make when due, after the application of any grace period, any
contribution to any Multiemployer Plan that the Borrower or any member of the
ERISA Group may be required to make under any agreement relating to such
Multiemployer Plan, or any Law pertaining thereto, that, either singularly or
when aggregated with other past due contributions, constitutes a material
amount;

 

(vi) withdraw (completely or partially) from any Multiemployer Plan or withdraw
(or be deemed under Section 4062(e) of ERISA to withdraw) from any Multiple
Employer Plan, where any such withdrawal is likely to result in a material
liability of the Borrower or any member of the ERISA Group;

 

(vii) terminate, or institute proceedings to terminate, any Plan, where such
termination is likely to result in a material liability to the Borrower or any
member of the ERISA Group;

 

(viii) make any amendment to any Plan with respect to which security is required
under Section 307 of ERISA; or

 

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(ix) fail to give any and all notices and make all disclosures and governmental
filings required under ERISA or the Internal Revenue Code, where such failure is
likely to result in a Material Adverse Change.

 

8.2.12 Fiscal Year.

 

The Borrower shall not, and shall not permit any other Loan Party to, change its
fiscal year from the twelve-month period beginning January 1 and ending December
31.

 

8.2.13 Issuance of Stock.

 

The Borrower shall not permit any other Loan Party to issue any additional
shares of such Loan Party’s capital stock or any options, warrants or other
rights in respect thereof to any Person other than to the Borrower or to any
other Loan Party.

 

8.2.14 Changes in Organizational Documents; Amendments to Receivables Purchase
Agreement.

 

(a) None of the Loan Parties shall amend in any material respect its certificate
of incorporation (including any provisions or resolutions relating to capital
stock), by-laws, certificate of limited partnership, partnership agreement,
certificate of formation, limited liability company agreement or other
organizational documents without providing at least thirty (30) calendar days’
prior written notice to the Paying Agent and the Lenders and, in the event such
change would be adverse to the Lenders as reasonably determined by the Paying
Agent, obtaining the prior written consent of the Required Lenders. For purposes
of the foregoing, it shall be deemed material for, among other things, any
amendment to affect the name of the entity, its state of formation, or its
outstanding equity interests or the transferability thereof.

 

(b) Each of the Loan Parties shall not, and shall not permit any of its
Subsidiaries to, supplement, modify, amend, or restate the Receivables Purchase
Agreement from time to time without providing at least thirty (30) calendar
days’ prior written notice to the Paying Agent and the Lenders and, in the event
any supplement, modification, amendment or restatement would make any covenant,
default, event of default or other material term under the Receivables Purchase
Agreement more restrictive, in any material respect, than the covenants,
defaults, events of default or other material terms of the Receivables Purchase
Agreement as in effect on the Closing Date, as reasonably determined by the
Paying Agent, without obtaining the prior written consent of the Required
Lenders.

 

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8.2.15 Capital Expenditures and Capitalized Leases.

 

None of the Loan Parties shall make payments in any fiscal year exceeding the
amount specified below for such fiscal year in the aggregate for the Loan
Parties on account of the purchase or lease of any assets which if purchased
would constitute fixed assets or which if leased would constitute a capitalized
lease in accordance with GAAP (excluding all assets purchased or leased through
(i) any Permitted Acquisition, (ii) reinvestment of insurance proceeds of a
Casualty Event, or (iii) any Investment):

 

Fiscal Year Ending

--------------------------------------------------------------------------------

   Amount

--------------------------------------------------------------------------------

December 31, 2004

   $ 450,000,000

December 31, 2005

   $ 550,000,000

December 31, 2006

   $ 550,000,000

For Each Fiscal Year Thereafter

   $ 400,000,000

 

and all such capital expenditures and capitalized leases shall be made under
usual and customary terms and in the ordinary course of business.

 

8.2.16 Certain Matters Regarding Senior Notes (1991), Senior Notes (2002) and
Certain Other Indebtedness.

 

(a) None of the Loan Parties shall defease or make any prepayments, purchases,
repurchases, or redemptions of or in respect of (i) the Senior Notes (1991) or
(ii) the Senior Notes (2002), except prepayments, purchases, repurchases, or
redemptions in an aggregate amount in any fiscal year of up to the portion of
the Available Excess Cash Flow that is not used to purchase or redeem common
stock of the Borrower pursuant to clause (iv) of Section 8.2.5 [Dividends and
Related Distributions].

 

(b) None of the Loan Parties shall supplement, modify, amend, or restate any of
the Senior Notes (1991), the Senior Notes (2002) or the Indebtedness described
on Schedule 8.2.1, from time to time without providing at least thirty (30)
calendar days’ prior written notice to the Paying Agent and the Lenders and, in
the event any supplement, modification, amendment or restatement would make any
covenant, default, event of default or other material term under the Senior
Notes (1991), the Senior Notes (2002) or any of the Indebtedness described on
Schedule 8.2.1, more restrictive, in any material respect, than the covenants,
defaults, events of default or other material terms of such Indebtedness, as in
effect on the Closing Date, as reasonably determined by the Paying Agent in its
sole discretion, without obtaining the prior written consent of the Required
Lenders.

 

8.2.17 Maximum Leverage Ratio.

 

The Loan Parties shall not at any time permit the Leverage Ratio, calculated as
of the end of each fiscal quarter, to be greater than 3.0 to 1.0.

 

8.2.18 Minimum Interest Coverage Ratio.

 

The Loan Parties shall not permit the Interest Coverage Ratio, calculated as of
the end of each fiscal quarter, to be less than 4.50 to 1.0.

 

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8.2.19 Inconsistent Agreements.

 

The Borrower shall not, and shall not permit any other Loan Party to, enter into
any agreement containing any provision that would be violated or breached by any
borrowing by the Borrower under this Agreement or by the performance by any Loan
Party of their respective Obligations under this Agreement or under any other
Loan Document.

 

8.2.20 Restrictions on Upstream Dividends and Payments.

 

The Borrower shall not, and shall not permit any other Loan Party to, enter into
any agreement containing any provisions that would prohibit, limit or otherwise
restrict dividends or distributions payable by any Loan Party to any other Loan
Party.

 

8.2.21 Certain Matters Regarding the Collateral Trust Agreement.

 

There shall be (i) no amendment, modification, supplement or restatement of nor
any waiver or consent under the Collateral Trust Agreement, nor (ii) any change
after the Closing Date in the Person that is the Collateral Trustee as of the
Closing Date, unless in the case of any of the matters under the immediately
preceding clause (i) and clause (ii) the Borrower shall have provided at least
thirty (30) calendar days’ prior written notice thereof to the Paying Agent and
the Lenders and obtaining the written consent of the Paying Agent and the
Required Lenders.

 

8.3 Reporting Requirements.

 

The Loan Parties, jointly and severally, covenant and agree that until payment
in full of the Loans, Reimbursement Obligations and Revolving Letter of Credit
Borrowings, return of the Tranche B Credit-Linked Deposits and interest thereon,
expiration or termination of all Letters of Credit, satisfaction of all of the
Loan Parties’ other Obligations hereunder and under the other Loan Documents and
termination of the Commitments, the Loan Parties will furnish or cause to be
furnished to the Paying Agent and each of the Lenders:

 

8.3.1 Quarterly Financial Statements.

 

As soon as available and in any event within forty-five (45) calendar days after
the end of each of the first three fiscal quarters in each fiscal year,
financial statements of the Borrower, consisting of a consolidated balance sheet
as of the end of such fiscal quarter and related consolidated statements of
income, stockholders’ equity, and cash flows for the fiscal quarter then ended
and the fiscal year through that date, all in reasonable detail and certified
(subject to normal year-end audit adjustments) by the Chief Financial Officer or
Treasurer of the Borrower as having been prepared in accordance with GAAP,
consistently applied, and setting forth in comparative form the respective
financial statements for the corresponding date and period in the previous
fiscal year.

 

8.3.2 Annual Financial Statements.

 

As soon as available and in any event within ninety (90) days after the end of
each fiscal year of the Borrower, financial statements of the Borrower
consisting of a

 

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consolidated balance sheet as of the end of such fiscal year, and related
consolidated statements of income, stockholders’ equity, and cash flows for the
fiscal year then ended, all in reasonable detail and setting forth in
comparative form the financial statements as of the end of and for the preceding
fiscal year, and certified by independent certified public accountants of
nationally recognized standing reasonably satisfactory to the Paying Agent. The
certificate or report of accountants shall be free of qualifications (other than
any consistency qualification that may result from a change in the method used
to prepare the financial statements as to which such accountants concur) and
shall not indicate the occurrence or existence of any event, condition or
contingency which would materially impair the prospect of payment or performance
of any covenant, agreement or duty of any Loan Party under any of the Loan
Documents.

 

8.3.3 SEC Web Site.

 

Reports required to be delivered pursuant to clauses 8.3.1 [Quarterly Financial
Statements] and 8.3.2 [Annual Financial Statements] above shall be deemed to
have been delivered on the date on which such report is posted on the SEC’s
website at www.sec.gov, and such posting shall be deemed to satisfy the
reporting requirements of clauses 8.3.1 and 8.3.2.

 

8.3.4 Certificate of the Borrower.

 

Concurrently with the financial statements of the Borrower furnished to the
Paying Agent and to the Lenders pursuant to Section 8.3.1 [Quarterly Financial
Statements] and 8.3.2 [Annual Financial Statements], a certificate (each a
“Compliance Certificate”) of the Borrower signed by the Chief Financial Officer
or Treasurer of the Borrower, in the form of Exhibit 8.3.4, to the effect that,
except as described pursuant to Section 8.3.5 [Notice of Default], (i) the
representations and warranties contained in Section 6 and in the other Loan
Documents are true on and as of the date of such certificate with the same
effect as though such representations and warranties had been made on and as of
such date (except representations and warranties which expressly relate solely
to an earlier date or time), (ii) no Event of Default or Potential Default
exists and is continuing on the date of such certificate and (iii) containing
calculations in sufficient detail to demonstrate compliance as of the date of
such financial statements with all financial covenants contained in Section 8.2
[Negative Covenants]. The certificate delivered with the annual financial
statements pursuant to Section 8.3.2 shall include a determination in reasonable
detail of the Excess Cash Flow and the Available Excess Cash Flow.

 

8.3.5 Notice of Default.

 

Promptly after any Responsible Officer of the Borrower has learned of the
occurrence of an Event of Default or Potential Default, a certificate signed by
a Responsible Officer of the Borrower setting forth the details of such Event of
Default or Potential Default and the action which the such Loan Party proposes
to take with respect thereto.

 

8.3.6 Notice of Litigation.

 

Promptly after the commencement thereof, notice of all actions, suits,
proceedings or investigations before or by any Official Body or any other Person
against any Loan

 

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Party (that would reasonably be expected to result in a liability against such
Loan Party), which relate to the Collateral, involve a claim or series of claims
in excess of $10,000,000 or which if adversely determined would constitute a
Material Adverse Change.

 

8.3.7 Certain Events.

 

Written notice to the Paying Agent:

 

(i) as required by Section 8.2.7(ix) [Disposition of Assets or Subsidiaries],
with respect to any proposed sale or transfer of assets pursuant to such
Section.

 

(ii) within the time limits set forth in Section 8.2.14 [Changes in
Organizational Documents, Etc.], any material amendment to the organizational
documents of any Loan Party (for purposes of the foregoing, it shall be deemed
material for, among other things, any amendment to affect the name of the
entity, its state of formation, or its outstanding equity interests or the
transferability thereof) and also within such time limits the other notices
required by such Section; and

 

(iii) at least thirty (30) calendar days prior thereto, with respect to any
change in any Loan Party’s locations from the locations set forth in Schedule A
to the Security Agreement.

 

8.3.8 Budgets, Forecasts, Other Reports and Information.

 

Promptly upon their becoming available to the Borrower:

 

(i) the annual budget and five year projections of the Borrower, to be supplied
not later than thirty (30) days after commencement of the fiscal year, in each
case, including a balance sheet, an income statement and cash flow information
as well as the relative contributions projected from the coal and gas segments
of the Loan Parties on a consolidated basis (including volumes, revenues, costs
and capital expenditures) with a written overview of key assumptions,

 

(ii) any reports, notices or proxy statements generally distributed by the
Borrower to its stockholders on a date no later than the date supplied to such
stockholders,

 

(iii) regular or periodic reports, including Forms 10-K, 10-Q and 8-K,
registration statements and prospectuses, filed by the Borrower or any other
Loan Party with the Securities and Exchange Commission, provided that the
foregoing reports shall be deemed to have been delivered on the date on which
such report is posted on the SEC’s web site at www.sec.gov, and such posting
shall be deemed to satisfy this reporting requirement,

 

(iv) a copy of any material order in any material proceeding to which the
Borrower or any other Loan Party is a party issued by any Official Body, and

 

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(v) such other reports and information as any of the Lenders may from time to
time reasonably request. The Borrower shall also notify the Lenders promptly of
the enactment or adoption of any Law that would reasonably be expected to result
in a Material Adverse Change.

 

8.3.9 Tax Shelter Provisions.

 

Promptly after any of the Loan Parties determines that it intends to treat any
of the Loans, Letters of Credit or related transactions as being a “reportable
transaction” as provided in Section 8.1.13 [Tax Shelter Regulations]

 

(1) a written notice of such intention to the Paying Agent; and

 

(2) a duly completed copy of IRS Form 8886 or any successor form.

 

8.3.10 Notices Regarding Plans and Benefit Arrangements.

 

8.3.10.1 Certain Events.

 

Promptly upon becoming aware of the occurrence thereof, notice (including the
nature of the event and, when known, any action taken or threatened by the
Internal Revenue Service or the PBGC with respect thereto) of:

 

(i) any Reportable Event with respect to the Borrower or any other member of the
ERISA Group (regardless of whether the obligation to report said Reportable
Event to the PBGC has been waived),

 

(ii) any Prohibited Transaction which could subject the Borrower or any other
member of the ERISA Group to a material civil penalty assessed pursuant to
Section 502(i) of ERISA or a material tax imposed by Section 4975 of the
Internal Revenue Code in connection with any Plan, any Benefit Arrangement or
any trust created thereunder,

 

(iii) any assertion of material withdrawal liability with respect to any
Multiemployer Plan,

 

(iv) any partial or complete withdrawal from a Multiemployer Plan by the
Borrower or any other member of the ERISA Group under Title IV of ERISA (or
assertion thereof), where such withdrawal is likely to result in material
withdrawal liability,

 

(v) any cessation of operations (by the Borrower or any other member of the
ERISA Group) at a facility in the circumstances described in Section 4062(e) of
ERISA,

 

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(vi) withdrawal by the Borrower or any other member of the ERISA Group from a
Multiple Employer Plan, where such withdrawal is likely to result in material
withdrawal liability,

 

(vii) a failure by the Borrower or any other member of the ERISA Group to make a
payment to a Plan required to avoid imposition of a Lien under Section 302(f) of
ERISA, or

 

(viii) the adoption of an amendment to a Plan requiring the provision of
security to such Plan pursuant to Section 307 of ERISA.

 

8.3.10.2 Notices of Involuntary Termination and Annual Reports.

 

Promptly after receipt thereof, copies of (a) all notices received by the
Borrower or any other member of the ERISA Group of the PBGC’s intent to
terminate any Plan administered or maintained by the Borrower or any member of
the ERISA Group, or to have a trustee appointed to administer any such Plan; and
(b) at the request of the Paying Agent or any Lender each annual report (IRS
Form 5500 series) and all accompanying schedules, the most recent actuarial
reports, the most recent financial information concerning the financial status
of each Plan administered or maintained by the Borrower or any other member of
the ERISA Group, and schedules showing the amounts contributed to each such Plan
by or on behalf of the Borrower or any other member of the ERISA Group in which
any of their personnel participate or from which such personnel may derive a
benefit, and each Schedule B (Actuarial Information) to the annual report filed
by the Borrower or any other member of the ERISA Group with the Internal Revenue
Service with respect to each such Plan.

 

8.3.10.3 Notice of Voluntary Termination.

 

Promptly upon the filing thereof, copies of any Form 5310, or any successor or
equivalent form to Form 5310, filed with the PBGC in connection with the
termination of any Plan.

 

8.3.11 Notice of Change in Debt Rating.

 

Within five (5) Business Days after Standard & Poor’s or Moody’s announces a
change in the Debt Rating, notice of such change. Borrower will deliver together
with such notice a copy of any written notification which Borrower received from
the applicable rating agency regarding such change of the Debt Rating.

 

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9. DEFAULT

 

9.1 Events of Default.

 

An Event of Default shall mean the occurrence or existence of any one or more of
the following events or conditions (whatever the reason therefor and whether
voluntary, involuntary or effected by operation of Law):

 

9.1.1 Payments Under Loan Documents.

 

(a) The Borrower shall fail to make any scheduled payment of principal of or pay
when due any Loan, Reimbursement Obligation or Revolving Letter of Credit
Borrowing; or

 

(b) The Borrower shall fail to pay any interest on any Loan, Reimbursement
Obligation or Revolving Letter of Credit Borrowing; or any other amount owing
hereunder or under the other Loan Documents within three (3) days after such
interest or other amount becomes due in accordance with the terms hereof or
thereof;

 

9.1.2 Breach of Warranty.

 

Any representation or warranty made at any time by any of the Loan Parties
herein or by any of the Loan Parties in any other Loan Document, or in any
certificate, other instrument or statement furnished pursuant to the provisions
hereof or thereof, shall prove to have been false or incorrect in any material
respect as of the time it was made or furnished;

 

9.1.3 Breach of Negative Covenants or Visitation Rights.

 

Any of the Loan Parties shall default in the observance or performance of any
covenant contained in Section 8.1.6 [Visitation Rights; Field Examinations] or
Section 8.2 [Negative Covenants];

 

9.1.4 Breach of Other Covenants.

 

Any of the Loan Parties shall default in the observance or performance of any
other covenant, condition or provision hereof or of any other Loan Document and
such default shall continue unremedied for a period of thirty (30) days after
any Responsible Officer of the Borrower becomes aware of the occurrence thereof
(such grace period to be applicable only in the event such default can be
remedied by corrective action of the Loan Parties as determined by the Paying
Agent in its sole discretion);

 

9.1.5 Defaults in Other Agreements or Indebtedness.

 

A default or event of default shall occur at any time under the terms of (i) the
Senior Notes (1991), (ii) the Senior Notes (2002), (iii) the Permitted
Receivables Facility or (iv) any other agreement involving borrowed money or the
extension of credit or any other Indebtedness under which any Loan Party may be
obligated as a borrower or guarantor in excess of $25,000,000 in the aggregate,
and such breach, default or event of default consists of the failure to pay
(beyond any period of grace permitted with respect thereto, whether waived or
not) any indebtedness when due (whether at stated maturity, by acceleration or
otherwise) or if such breach or default permits or causes the acceleration of
any indebtedness (whether or not such right shall have been waived) or the
termination of any commitment to lend;

 

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9.1.6 Loss of Bonding Capability.

 

(i) The Loan Parties, taken as a whole, shall fail to maintain sufficient mine
bonding capacity to be able to conduct their operations substantially as
contemplated by the mining plans used in preparing the Financial Projections, or
(ii) the Loan Parties shall default, in any material manner, in the compliance
with or the performance of its surety bonding agreements and obligations
(including, but not limited to any default in the payment of outstanding
reimbursement claims owing in connection with any of the bonds outstanding) and
such default would materially adversely affect the Loan Parties’, taken as a
whole, ability to conduct their operations substantially as contemplated by the
mining plans used in preparing the Financial Projections .

 

9.1.7 Final Judgments or Orders.

 

Any final judgments or orders not covered by insurance for the payment of money
in excess of $10,000,000 in the aggregate shall be entered against any Loan
Party by a court having jurisdiction in the premises, which judgment is not
discharged, vacated, bonded or stayed pending appeal within a period of sixty
(60) days from the date of entry;

 

9.1.8 Loan Document Unenforceable; Collateral Trust Agreement Unenforceable.

 

Any of the Loan Documents to which any Loan Party is a party shall cease to be
legal, valid and binding agreements enforceable against any Loan Party executing
the same or such Loan Party’s successors and assigns (as permitted under the
Loan Documents) in accordance with the respective terms thereof or shall cease
to be in full force and effect (except by operation of its terms) or shall be
contested or challenged by any Loan Party or any agent thereof or cease to give
or provide the respective Liens, security interests, rights, titles, interests,
remedies, powers or privileges intended to be created thereby;

 

The Collateral Trust Agreement, at any time and for any reason (i) shall cease
to be in full force and effect, (ii) is declared to be null and void or (iii) is
the subject of a challenge to, or a dispute over, any aspect of such Collateral
Trust Agreement and such challenge or dispute is determined by the Paying Agent
to be reasonably likely to adversely affect any Lien granted as security for the
Obligations under each Mortgage, the Security Agreement, the Patent Trademark
and Copyright Security Agreement, the Pledge Agreement and any other Loan
Document;

 

9.1.9 Uninsured Losses; Proceedings Against Assets.

 

There shall occur (i) any material uninsured damage to or loss, theft or
destruction of any of the Collateral in excess of $75,000,000 or (ii) any of the
Collateral or any other of the Loan Parties’ assets, having a fair market value
in excess of $10,000,000, are attached, seized, levied upon by, or subjected to
a writ or distress warrant in favor of, or such come within the possession of,
any receiver, trustee, custodian or assignee for the benefit of creditors and
the same is not cured within sixty (60) days thereafter;

 

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9.1.10 Notice of Lien or Assessment.

 

A notice of Lien or assessment in excess of $10,000,000 which is not a Permitted
Lien is filed of record with respect to all or any part of any of the Loan
Parties’ assets by the United States, or any department, agency or
instrumentality thereof, or by any state, county, municipal or other
governmental agency, including the PBGC, or any taxes or debts owing at any time
or times hereafter to any one of these becomes payable and the same is not paid
within thirty (30) days after the same becomes payable;

 

9.1.11 Insolvency.

 

The Loan Parties, taken as whole, cease to be Solvent or any Loan Party admits
in writing its inability to pay its debts as they mature;

 

9.1.12 Events Relating to Plans and Benefit Arrangements.

 

Any of the following occurs: (i) any Reportable Event, which the Paying Agent
determines in good faith constitutes grounds for the termination of any Plan by
the PBGC or the appointment of a trustee to administer or liquidate any Plan,
shall have occurred and be continuing; (ii) proceedings shall have been
instituted or other action taken to terminate any Plan, or a termination notice
shall have been filed with respect to any Plan; (iii) a trustee shall be
appointed to administer or liquidate any Plan; (iv) the PBGC shall give notice
of its intent to institute proceedings to terminate any Plan or Plans or to
appoint a trustee to administer or liquidate any Plan; and, in the case of the
occurrence of (i), (ii), (iii) or (iv) above, the Paying Agent determines in
good faith that the amount of the Borrower’s liability is likely to exceed
$10,000,000; (v) the Borrower or any member of the ERISA Group shall fail to
make any contributions when due to a Plan or a Multiemployer Plan (after the
application of any grace period), and such failure, either singularly or when
combined with other such failures, is material in amount; (vi) the Borrower or
any other member of the ERISA Group shall make any amendment to a Plan with
respect to which security is required under Section 307 of ERISA; (vii) the
Borrower or any other member of the ERISA Group shall withdraw completely or
partially from a Multiemployer Plan, where such withdrawal results in a material
withdrawal liability to the Borrower or any member of the ERISA Group; (viii)
the Borrower or any other member of the ERISA Group shall withdraw (or shall be
deemed under Section 4062(e) of ERISA to withdraw) from a Multiple Employer
Plan, where such withdrawal results in a material withdrawal liability to the
Borrower or any member of the ERISA Group; or (ix) any applicable Law is
adopted, changed or interpreted by any Official Body with respect to or
otherwise affecting one or more Plans, Multiemployer Plans or Benefit
Arrangements and, with respect to any of the events specified in (v), (vi),
(vii), (viii) or (ix), the Paying Agent determines in good faith that any such
occurrence would be reasonably likely to materially and adversely affect the
total enterprise represented by the Borrower and the other members of the ERISA
Group;

 

9.1.13 Cessation of Business.

 

The Loan Parties, taken as a whole cease to conduct their business as
contemplated by the Financial Projections, except as expressly permitted under
Section 8.2.6

 

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[Liquidations, Mergers, Etc.] or 8.2.7 [Disposition of Assets or Subsidiaries],
or the Loan Parties, taken as a whole, are enjoined, restrained or in any way
prevented by court order from conducting all or any material part of their
business and such injunction, restraint or other preventive order is not
dismissed within thirty (30) days after the entry thereof;

 

9.1.14 Change of Control.

 

(i) Any person or group of persons (within the meaning of Sections 13(d) or
14(a) of the Securities Exchange Act of 1934, as amended) shall have acquired
beneficial ownership of (within the meaning of Rule 13d-3 promulgated by the
Securities and Exchange Commission under said Act) 25% or more of the voting
capital stock of the Borrower; or (ii) within a period of twelve (12)
consecutive calendar months, individuals who were directors of the Borrower on
the first day of such period shall cease to constitute a majority of the board
of directors of the Borrower;

 

9.1.15 Involuntary Proceedings.

 

A proceeding shall have been instituted in a court having jurisdiction in the
premises seeking a decree or order for relief in respect of any Loan Party in an
involuntary case under any applicable bankruptcy, insolvency, reorganization or
other similar law now or hereafter in effect, or for the appointment of a
receiver, liquidator, assignee, custodian, trustee, sequestrator, conservator
(or similar official) of any Loan Party for any substantial part of its
property, or for the winding-up or liquidation of its affairs, and such
proceeding shall remain undismissed or unstayed and in effect for a period of
sixty (60) consecutive days or such court shall enter a decree or order granting
any of the relief sought in such proceeding; or

 

9.1.16 Voluntary Proceedings.

 

Any Loan Party shall commence a voluntary case under any applicable bankruptcy,
insolvency, reorganization or other similar law now or hereafter in effect,
shall consent to the entry of an order for relief in an involuntary case under
any such law, or shall consent to the appointment or taking possession by a
receiver, liquidator, assignee, custodian, trustee, sequestrator, conservator
(or other similar official) of itself or for any substantial part of its
property or shall make a general assignment for the benefit of creditors, or
shall fail generally to pay its debts as they become due, or shall take any
action in furtherance of any of the foregoing.

 

9.2 Consequences of Event of Default.

 

9.2.1 Events of Default Other Than Bankruptcy, Insolvency or Reorganization
Proceedings.

 

If an Event of Default specified under Sections 9.1.1 [Payments under Loan
Documents] through 9.1.14 [Change of Control] shall occur and be continuing, the
Lenders and the Paying Agent shall be under no further obligation to make Loans
or issue Letters of Credit, as the case may be, and the Paying Agent may, and
upon the request of the Required Lenders, shall (i) by written notice to the
Borrower, declare the unpaid principal amount of the

 

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Notes then outstanding and all interest accrued thereon, any unpaid fees and all
other Indebtedness of the Borrower to the Lenders hereunder and thereunder to be
forthwith due and payable, and the same shall thereupon become and be
immediately due and payable to the Paying Agent for the benefit of each Lender
without presentment, demand, protest or any other notice of any kind, all of
which are hereby expressly waived, and (ii) require the Borrower to, and the
Borrower shall thereupon, deposit in a non-interest-bearing account with the
Paying Agent, as cash collateral for its Obligations under the Loan Documents,
an amount equal to the maximum amount currently or at any time thereafter
available to be drawn on all outstanding Letters of Credit, and the Borrower
hereby pledges to the Paying Agent and the Lenders, and grants to the Paying
Agent and the Lenders a security interest in, all such cash as security for such
Obligations. Moneys in such account shall be applied by the Paying Agent to
reimburse the Issuing Bank for LC Disbursements for which it has not been
reimbursed and, if the maturity of the Loans has been accelerated (with the
consent of the Required Lenders), be applied to satisfy other outstanding
Obligations. Upon the curing of all existing Events of Default to the
satisfaction of the Required Lenders, the Paying Agent shall return such cash
collateral to the Borrower; and

 

9.2.2 Bankruptcy, Insolvency or Reorganization Proceedings.

 

If an Event of Default specified under Section 9.1.15 [Involuntary Proceedings]
or 9.1.16 [Voluntary Proceedings] shall occur, the Lenders shall be under no
further obligations to make Loans hereunder and the unpaid principal amount of
the Loans then outstanding and all interest accrued thereon, any unpaid fees and
all other Indebtedness of the Borrower to the Lenders hereunder and thereunder
shall be immediately due and payable, without presentment, demand, protest or
notice of any kind, all of which are hereby expressly waived; and

 

9.2.3 Set-off.

 

If an Event of Default shall occur and be continuing, any Lender to whom any
Obligation is owed by any Loan Party hereunder or under any other Loan Document
or any participant of such Lender which has agreed in writing to be bound by the
provisions of Section 10.13 [Equalization of Lenders] and any branch, Subsidiary
or Affiliate of such Lender or participant anywhere in the world shall have the
right, in addition to all other rights and remedies available to it, without
notice to such Loan Party, to set-off against and apply to the then unpaid
balance of all the Loans and all other Obligations of the Borrower and the other
Loan Parties hereunder or under any other Loan Document any debt owing to, and
any other funds held in any manner for the account of, the Borrower or such
other Loan Party by such Lender or participant or by such branch, Subsidiary or
Affiliate, including all funds in all deposit accounts (whether time or demand,
general or special, provisionally credited or finally credited, or otherwise)
now or hereafter maintained by the Borrower or such other Loan Party for its own
account (but not including funds held in custodian or trust accounts) with such
Lender or participant or such branch, Subsidiary or Affiliate. Such right shall
exist whether or not any Lender or the Paying Agent shall have made any demand
under this Agreement or any other Loan Document, whether or not such debt owing
to or funds held for the account of the Borrower or such other Loan Party is or
are matured or unmatured and regardless of the existence or adequacy of any
Collateral, Guaranty or any other security, right or remedy available to any
Lender or the Paying Agent; and

 

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9.2.4 Suits, Actions, Proceedings.

 

If an Event of Default shall occur and be continuing, and whether or not the
Paying Agent shall have accelerated the maturity of Loans pursuant to any of the
foregoing provisions of this Section 9.2, the Paying Agent or any Lender, if
owed any amount with respect to the Loans, may proceed to protect and enforce
its rights by suit in equity, action at law and/or other appropriate proceeding,
whether for the specific performance of any covenant or agreement contained in
this Agreement or the other Loan Documents, including as permitted by applicable
Law the obtaining of the ex parte appointment of a receiver, and, if such amount
shall have become due, by declaration or otherwise, proceed to enforce the
payment thereof or any other legal or equitable right of the Paying Agent or
such Lender; and

 

9.2.5 Application of Proceeds; Collateral Trust Agreement.

 

9.2.5.1 Application of Proceeds.

 

From and after the date on which the Paying Agent has taken any action pursuant
to this Section 9.2 and until all Obligations of the Loan Parties have been paid
in full, any and all proceeds received by the Paying Agent from any sale or
other disposition of the Collateral, or any part thereof, or the exercise of any
other remedy by the Collateral Trustee or the Paying Agent, shall be applied,
subject to the provisions of the Collateral Trust Agreement, as follows:

 

(i) first, to reimburse the Paying Agent and the Lenders for out-of-pocket
costs, expenses and disbursements, including reasonable attorneys’ and
paralegals’ fees and legal expenses, incurred by the Paying Agent or the Lenders
in connection with realizing on the Collateral or collection of any Obligations
of any of the Loan Parties under any of the Loan Documents, including advances
made by the Lenders or any one of them or the Paying Agent for the reasonable
maintenance, preservation, protection or enforcement of, or realization upon,
the Collateral, including advances for taxes, insurance, repairs and the like
and reasonable expenses incurred to sell or otherwise realize on, or prepare for
sale or other realization on, any of the Collateral;

 

(ii) second, to the repayment of all Obligations then due and unpaid of the Loan
Parties to the Lenders incurred under this Agreement or any of the other Loan
Documents or a Specified Swap Agreement whether of principal, interest, fees,
expenses or otherwise, on a pro rata basis; and

 

(iii) the balance, if any, as required by Law.

 

9.2.5.2 Collateral Trust Agreement.

 

Subject to sharing provisions set forth in the Collateral Trust Agreement, all
Liens granted as security for the Obligations under each Mortgage, the Security
Agreement, the Patent Trademark and Copyright Security Agreement, the Pledge
Agreement and any other Loan Document (collectively, the “Collateral Documents”)
shall secure ratably and on a pari passu basis (i) the Obligations in favor of
the Paying Agent, the Co-Administrative Agents and the Lenders hereunder and
(ii) the Obligations incurred by any of the Loan Parties in favor of any

 

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Lender which provides a Specified Swap Agreement (the “ Specified Swap Agreement
Provider”). The Paying Agent shall be deemed to serve as the collateral agent
(the “Lender Group Collateral Agent”) for each Specified Swap Agreement
Provider, for itself as Paying Agent, for each Co-Administrative Agent, and for
the Lenders hereunder, provided that the Lender Group Collateral Agent shall
comply with the instructions and directions of the Paying Agent (or the Lenders
under this Agreement to the extent that this Agreement or any other Loan
Documents empowers the Lenders to direct the Paying Agent), as to all matters
relating to the Collateral, including the maintenance and disposition thereof.
No Specified Swap Agreement Provider (except in its capacity as a Lender
hereunder) shall be entitled or have the power to direct or instruct the Lender
Group Collateral Agent on any such matters or to control or direct in any manner
the maintenance or disposition of the Collateral.

 

9.2.6 Other Rights and Remedies.

 

In addition to all of the rights and remedies contained in this Agreement or in
any of the other Loan Documents (including each Mortgage), subject to the
Collateral Trust Agreement, the Paying Agent and the Collateral Trustee shall
have all of the rights and remedies of a secured party under the Uniform
Commercial Code or other applicable Law, all of which rights and remedies shall
be cumulative and non-exclusive, to the extent, subject to the Collateral Trust
Agreement, permitted by Law. The Paying Agent and the Collateral Trustee may,
and upon the request of the Required Lenders shall, exercise all post-default
rights granted to the Paying Agent and the Lenders under the Loan Documents or
applicable Law.

 

9.3 Notice of Sale.

 

Any notice required to be given by the Collateral Trustee of a sale, lease, or
other disposition of the Collateral or any other intended action by the
Collateral Trustee, if given to the Borrower at least ten (10) days prior to
such proposed action, shall constitute commercially reasonable and fair notice
thereof to the Borrower.

 

10. THE PAYING AGENT; THE CO-ADMINISTRATIVE AGENTS

 

10.1 Appointment.

 

Each Lender hereby irrevocably designates, appoints and authorizes: (i) PNC Bank
to act as Paying Agent for such Lender under this Agreement and to execute and
deliver or accept on behalf of each of the Lenders the other Loan Documents, and
(ii) authorizes each of Citicorp North America, Inc. and PNC Bank to act as
Co-Administrative Agents for each Lender under this Agreement. Each Lender
hereby irrevocably authorizes, and each holder of any Note by the acceptance of
a Note shall be deemed irrevocably to authorize, the Paying Agent to take such
action on its behalf under the provisions of this Agreement and the other Loan
Documents and any other instruments and agreements referred to herein, and to
exercise such powers and to perform such duties hereunder as are specifically
delegated to or required of the Paying Agent, the Co-Administrative Agents or
any of them by the terms hereof, together with such powers as are reasonably
incidental thereto. PNC Bank agrees to act as the Paying Agent on

 

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behalf of the Lenders to the extent provided in this Agreement, and each of
Citicorp North America, Inc. and PNC Bank agrees to act as Co-Administrative
Agents on behalf of the Lenders to the extent provided in this Agreement.

 

10.2 Delegation of Duties.

 

The Co-Administrative Agents and the Paying Agent may perform any of their
respective duties hereunder by or through agents or employees (provided such
delegation does not constitute a relinquishment of their respective duties as
Co-Administrative Agents or Paying Agent, as the case may be) and, subject to
Sections 10.5 [Reimbursement and Indemnification of Agents by the Borrower] and
10.6 [Exculpatory Provisions, Etc.], shall be entitled to engage and pay for the
advice or services of any attorneys, accountants or other experts concerning all
matters pertaining to its duties hereunder and to rely upon any advice so
obtained. It is acknowledged and agreed that each of LaSalle Bank National
Association, Société Générale, New York Branch and SunTrust Bank has received
the title of co-documentation agent under this Agreement, however such
designations are solely to give each of LaSalle Bank National Association,
Société Générale, New York Branch and SunTrust Bank its respective title and
each of LaSalle Bank National Association, Société Générale, New York Branch and
SunTrust Bank has no duties, responsibilities, functions, obligations or
liabilities implied or otherwise under the Loan Documents solely as a result of
being so designated as a co-documentation agent.

 

10.3 Nature of Duties; Independent Credit Investigation.

 

Neither the Co-Administrative Agents nor the Paying Agent shall have any duties
or responsibilities except those expressly set forth in this Agreement and no
implied covenants, functions, responsibilities, duties, obligations, or
liabilities shall be read into this Agreement or otherwise exist. The duties of
the Paying Agent and the Co-Administrative Agents shall be mechanical and
administrative in nature; neither the Paying Agent nor the Co-Administrative
Agents shall have by reason of this Agreement a fiduciary or trust relationship
in respect of any Lender; and nothing in this Agreement, expressed or implied,
is intended to or shall be so construed as to impose upon the Paying Agent or
any Co-Administrative Agent any obligations in respect of this Agreement except
as expressly set forth herein. Without limiting the generality of the foregoing,
the use of the term “agents” in this Agreement with reference to the Paying
Agent or the Co-Administrative Agents is not intended to connote any fiduciary
or other implied (or express) obligations arising under agency doctrine of any
applicable Law. Instead, such term is used merely as a matter of market custom,
and is intended to create or reflect only an administrative relationship between
independent contracting parties. Each Lender expressly acknowledges (i) that
neither the Paying Agent nor any Co-Administrative Agent has made any
representations or warranties to it and that no act by the Paying Agent or any
Co-Administrative Agent hereafter taken, including any review of the affairs of
any of the Loan Parties, shall be deemed to constitute any representation or
warranty by the Paying Agent or any Co-Administrative Agent to any Lender; (ii)
that it has made and will continue to make, without reliance upon the Paying
Agent or any Co-Administrative Agent, its own independent investigation of the
financial condition and affairs and its own appraisal of the creditworthiness of
each of the Loan Parties in connection with this Agreement and the making and
continuance of

 

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the Loans hereunder; and (iii) except as expressly provided herein, that neither
the Paying Agent nor any Co-Administrative Agent shall have any duty or
responsibility, either initially or on a continuing basis, to provide any Lender
with any credit or other information with respect thereto, whether coming into
its possession before the making of any Loan or at any time or times thereafter.

 

10.4 Actions in Discretion of Agents; Instructions From the Lenders.

 

The Paying Agent and each Co-Administrative Agent agrees, upon the written
request of the Required Lenders, to take or refrain from taking any action of
the type specified as being within the Paying Agent’s or such Co-Administrative
Agent’s rights, powers or discretion herein, provided that neither the Paying
Agent nor any Co-Administrative Agent shall be required to take any action that
exposes the Paying Agent or any Co-Administrative Agent to personal liability or
that is contrary to this Agreement or any other Loan Document or applicable Law.
In the absence of a request by the Required Lenders, the Paying Agent and each
Co-Administrative Agent shall have authority, in its sole discretion, to take or
not to take any such action, unless this Agreement specifically requires the
consent of the Required Lenders or all of the Lenders. Any action taken or
failure to act pursuant to such instructions or discretion shall be binding on
the Lenders, subject to Section 10.6 [Exculpatory Provisions, Etc.]. Subject to
the provisions of Section 10.6, no Lender shall have any right of action
whatsoever against the Paying Agent or any Co-Administrative Agent as a result
of the Paying Agent or any Co-Administrative Agent acting or refraining from
acting hereunder in accordance with the instructions of the Required Lenders, or
in the absence of such instructions, in the absolute discretion of the Paying
Agent or the Co-Administrative Agents, as the case may be.

 

10.5 Reimbursement and Indemnification of Agents by the Borrower.

 

The Borrower unconditionally agrees to pay or reimburse the Paying Agent and
each Co-Administrative Agent and hold the Paying Agent and each
Co-Administrative Agent harmless against (a) liability for the payment of all
reasonable out-of-pocket costs, expenses and disbursements, including fees and
expenses of counsel, appraisers and environmental consultants, incurred by the
Paying Agent or any Co-Administrative Agent (i) in connection with the
development, negotiation, preparation, printing, execution, administration,
syndication, interpretation and performance of this Agreement and the other Loan
Documents, (ii) relating to any requested amendments, waivers or consents
pursuant to the provisions hereof, (iii) in connection with the enforcement of
this Agreement or any other Loan Document or collection of amounts due hereunder
or thereunder or the proof and allowability of any claim arising under this
Agreement or any other Loan Document, whether in bankruptcy or receivership
proceedings or otherwise, and (iv) in any workout or restructuring or in
connection with the protection, preservation, exercise or enforcement of any of
the terms hereof or of any rights hereunder or under any other Loan Document or
in connection with any foreclosure, collection or bankruptcy proceedings, and
(b) all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever that may be imposed on, incurred by or asserted against the Paying
Agent or any Co-Administrative Agent, in its capacity as such, in any way
relating to or arising out of this Agreement or any other Loan Documents or any
action taken or omitted by the Paying Agent or any Co-Administrative Agent
hereunder or

 

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thereunder, provided that the Borrower shall not be liable for any portion of
such liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements if the same results from the Paying
Agent’s or any Co-Administrative Agent’s gross negligence or willful misconduct,
or if the Borrower was not given notice of the subject claim and the opportunity
to participate in the defense thereof, at its expense (except that the Borrower
shall remain liable to the extent such failure to give notice does not result in
a loss to the Borrower), or if the same results from a compromise or settlement
agreement entered into without notice to or the consent of the Borrower, which
consent shall not be unreasonably withheld. In addition, subsequent to an Event
of Default, the Borrower agrees to reimburse and pay all reasonable
out-of-pocket expenses of the Paying Agent’s regular employees and agents
engaged periodically to perform audits of the Loan Parties’ books, records and
business properties in accordance with the terms of this Agreement.

 

10.6 Exculpatory Provisions; Limitation of Liability.

 

Neither the Paying Agent, any Co-Administrative Agent nor any of their
respective directors, officers, employees, agents, attorneys or Affiliates shall
(a) be liable to any Lender for any action taken or omitted to be taken by it or
them hereunder, or in connection herewith including pursuant to any Loan
Document, unless caused by its or their own gross negligence or willful
misconduct, (b) be responsible in any manner to any of the Lenders for the
effectiveness, enforceability, genuineness, validity or the due execution of
this Agreement or any other Loan Documents or for any recital, representation,
warranty, document, certificate, report or statement herein or made or furnished
under or in connection with this Agreement or any other Loan Documents, or (c)
be under any obligation to any of the Lenders to ascertain or to inquire as to
the performance or observance of any of the terms, covenants or conditions
hereof or thereof on the part of the Loan Parties, or the financial condition of
the Loan Parties, or the existence or possible existence of any Event of Default
or Potential Default. No claim may be made by any of the Loan Parties, any
Lender, the Paying Agent, any Co-Administrative Agent or any of their respective
Subsidiaries against the Paying Agent, any Co-Administrative Agent, any Lender
or any of their respective directors, officers, employees, agents, attorneys or
Affiliates, or any of them, for any special, indirect or consequential damages
or, to the fullest extent permitted by Law, for any punitive damages in respect
of any claim or cause of action (whether based on contract, tort, statutory
liability, or any other ground) based on, arising out of or related to any Loan
Document or the transactions contemplated hereby or any act, omission or event
occurring in connection therewith, including the negotiation, documentation,
administration or collection of the Loans, and each of the Loan Parties, (for
itself and on behalf of each of its Subsidiaries), the Paying Agent, each
Co-Administrative Agent and each Lender hereby waive, release and agree never to
sue upon any claim for any such damages, whether such claim now exists or
hereafter arises and whether or not it is now known or suspected to exist in its
favor. Each Lender agrees that, except for notices, reports and other documents
expressly required to be furnished to the Lenders by the Paying Agent or any
Co-Administrative Agent hereunder or given to the Paying Agent or any
Co-Administrative Agent for the account of or with copies for the Lenders, the
Paying Agent, each Co-Administrative Agent and each of their respective
directors, officers, employees, agents, attorneys or Affiliates shall not have
any duty or responsibility to provide any Lender with any credit or other
information concerning the business, operations, property, condition (financial
or otherwise), prospects or creditworthiness of the Loan Parties that may

 

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come into the possession of the Paying Agent, any Co-Administrative Agent or any
of their respective directors, officers, employees, agents, attorneys or
Affiliates.

 

10.7 Reimbursement and Indemnification of Agents by Lenders.

 

Each Lender agrees to reimburse and indemnify the Paying Agent and each
Co-Administrative Agent (to the extent not reimbursed by the Borrower and
without limiting the Obligation of the Borrower to do so) in proportion to its
Ratable Share, from and against all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements,
including attorneys’ fees and disbursements (including the allocated costs of
staff counsel), and costs of appraisers and environmental consultants, of any
kind or nature whatsoever that may be imposed on, incurred by or asserted
against the Paying Agent, any Co-Administrative Agent, or any of them in their
respective capacities as such, in any way relating to or arising out of this
Agreement or any other Loan Documents or any action taken or omitted by the
Paying Agent, or any Co-Administrative Agent hereunder or thereunder, provided
that no Lender shall be liable for any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements (a) if the same results from the Paying Agent’s or any
Co-Administrative Agent’s gross negligence or willful misconduct, or (b) if such
Lender was not given notice of the subject claim and the opportunity to
participate in the defense thereof, at its expense (except that such Lender
shall remain liable to the extent such failure to give notice does not result in
a loss to the Lender), or (c) if the same results from a compromise and
settlement agreement entered into without the consent of such Lender, which
shall not be unreasonably withheld. In addition, each Lender agrees promptly
upon demand to reimburse the Paying Agent and each Co-Administrative Agent (to
the extent not reimbursed by the Borrower and without limiting the Obligation of
the Borrower to do so) in proportion to its Ratable Share for all amounts due
and payable by the Borrower to the Paying Agent or the Co-Administrative Agents,
as the case may be in connection with the periodic audit of the Loan Parties’
books, records and business properties by the Paying Agent or the
Co-Administrative Agents.

 

10.8 Reliance by Agents.

 

The Paying Agent and each Co-Administrative Agent shall be entitled to rely upon
any writing, telegram, telex or teletype message, electronic signature delivery
system (in a form acceptable to the Paying Agent), resolution, notice, consent,
certificate, letter, cablegram, statement, order or other document or
conversation by telephone, or otherwise believed by it to be genuine and correct
and to have been signed, sent or made by the proper Person or Persons, and upon
the advice and opinions of counsel and other professional advisers selected by
the Paying Agent or any Co-Administrative Agent. The Paying Agent and each
Co-Administrative Agent shall be fully justified in failing or refusing to take
any action hereunder unless it shall first be indemnified to its satisfaction by
the Lenders against any and all liability and expense which may be incurred by
it by reason of taking or continuing to take any such action.

 

10.9 Notice of Default.

 

Neither the Paying Agent nor any Co-Administrative Agent shall be deemed to have
knowledge or notice of the occurrence of any Potential Default or Event of

 

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Default unless such Paying Agent or Co-Administrative Agent, as the case may be,
has received written notice from a Lender or the Borrower referring to this
Agreement, describing such Potential Default or Event of Default and stating
that such notice is a “notice of default.”

 

10.10 Notices.

 

Each of the Paying Agent and each Co-Administrative Agent agrees to promptly
send to each Lender a copy of all notices received from the Borrower pursuant to
the provisions of this Agreement or the other Loan Documents promptly upon
receipt thereof. The Paying Agent shall promptly notify the Borrower and the
other Lenders of each change in the Base Rate and the effective date thereof.

 

10.11 Lenders in Their Individual Capacities.

 

With respect to its Revolving Credit Commitment, the Revolving Credit Loans, and
the Tranche B Credit-Linked Deposits made by it and any other rights and powers
given to it as a Lender hereunder or under any of the other Loan Documents, the
Paying Agent and each Co-Administrative Agent shall have the same rights and
powers hereunder as any other Lender and may exercise the same as though it were
not the Paying Agent or a Co-Administrative Agent, and the term “Lender” and
“Lenders” shall, unless the context otherwise indicates, include the Paying
Agent and each Co-Administrative Agent in its individual capacity. Citicorp
North America, Inc. and its Affiliates, PNC Bank and its Affiliates, and each of
the Lenders and their respective Affiliates may, without liability to account,
except as prohibited herein, make loans to, issue letters of credit for the
account of, acquire equity interests in, accept deposits from, discount drafts
for, act as trustee under indentures of, and generally engage in any kind of
banking, trust, financial advisory, underwriting or other business with, the
Loan Parties and their Affiliates, in the case of the Paying Agent or any
Co-Administrative Agent, as though it were not acting as Paying Agent or
Co-Administrative Agent, as the case may be, hereunder and in the case of each
Lender, as though such Lender were not a Lender hereunder, in each case without
notice to or consent of the other Lenders. The Lenders acknowledge that,
pursuant to such activities, the Paying Agent or its Affiliates or any
Co-Administrative Agent or its respective Affiliates may (i) receive information
regarding the Loan Parties or any of their Subsidiaries or Affiliates (including
information that may be subject to confidentiality obligations in favor of the
Loan Parties or such Subsidiary or Affiliate) and acknowledge that neither the
Paying Agent nor any Co-Administrative Agent shall be under an obligation to
provide such information to them, and (ii) accept fees and other consideration
from the Loan Parties for services in connection with this Agreement and
otherwise without having to account for the same to the Lenders.

 

10.12 Holders of Notes.

 

The Paying Agent may deem and treat any (i) payee of any Note or (ii) holder of
a Tranche B Credit-Linked Deposit, as the owner thereof for all purposes hereof
unless and until written notice of the assignment or transfer thereof shall have
been filed with the Paying Agent. Any request, authority or consent of any
Person who at the time of making such request or giving such authority or
consent is the holder of any Note or the Tranche B Credit-Linked

 

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Deposit shall be conclusive and binding on any subsequent holder, transferee or
assignee of such Note or Tranche B Credit-Linked Deposit or of any Note or Notes
issued in exchange therefor.

 

10.13 Equalization of Lenders; Sharing of Payments.

 

10.13.1 Equalization of Lenders.

 

The Lenders agree among themselves that, with respect to all amounts received by
any Lender or any such holder for application on any Obligation relating to the
Notes or the Tranche B Credit-Linked Deposits whether received by voluntary
payment, by realization upon security, by the exercise of the right of set-off
or banker’s lien, by counterclaim or by any other non-pro rata source, equitable
adjustment will be made in the manner stated in the following sentence so that,
in effect, all such excess amounts will be shared ratably among the Lenders and
such holders in proportion to their interests in the Obligations then due and
payable relating to the Notes or the Tranche B Credit-Linked Deposits (including
any Obligation to provide cash collateral for Letters of Credit), provided that
payments made to any Lender in respect of Obligations arising under Section
4.4.3 [Paying Agent’s and Lender’s Rights], 5.4.2 [Replacement of a Lender] or
5.6 [Additional Compensation in Certain Circumstances] may be retained by such
Lender. The Lenders or any such holder receiving any such amount shall purchase
for cash from each of the other Lenders an interest in such Lender’s Loans or
Tranche B Credit-Linked Deposits in such amount as shall result in a ratable
participation by the Lenders and each such holder in the aggregate unpaid amount
under the Notes plus the amount of the Tranche B Credit-Linked Deposits,
provided that if all or any portion of such excess amount is thereafter
recovered from the Lender or the holder making such purchase, such purchase
shall be rescinded and the purchase price restored to the extent of such
recovery, together with interest or other amounts, if any, required by law
(including court order) to be paid by the Lender or the holder making such
purchase.

 

10.13.2 Sharing of Payments.

 

From and after the date of a Triggering Event and until all Obligations of the
Loan Parties have been paid in full, any and all payments and proceeds received
by the Paying Agent (other than with respect to distributions of cash collateral
paid to the Paying Agent by the Collateral Trustee under the Collateral Trust
Agreement as a result of drawings under a Letter of Credit), whether from a
distribution by the Collateral Trustee under the Collateral Trust Agreement, any
sale or other disposition of all or a part of the Collateral or the exercise of
any other remedy by the Collateral Trustee or the Paying Agent, shall be paid by
the Paying Agent to the Lenders as follows:

 

(i) first, to reimburse the Paying Agent and the Lenders for out-of-pocket
costs, expenses and disbursements, including reasonable attorneys’ fees and
expenses, incurred by the Paying Agent or the Lenders in connection with fees,
expenses and indemnities paid to the Collateral Trustee under the Collateral
Trust Agreement, realizing on the Collateral or collection of any Obligations of
any of the Loan Parties under any of the Loan Documents, including advances made
by the Lenders or any one of them or the Paying Agent to the Collateral Trustee
or otherwise for the reasonable maintenance,

 

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preservation, protection or enforcement of, or realization upon, the Collateral,
including advances for taxes, insurance, repairs and the like and reasonable
expenses incurred to sell or otherwise realize on, or prepare for sale or other
realization on, any of the Collateral;

 

(ii) second, to the ratable payment (based upon the Obligations outstanding at
the time of the Triggering Event) of the Obligations then due and unpaid of the
Loan Parties to the Lenders (including Obligations owing under the Specified
Swap Agreements and cash collateral for the Letters of Credit) whether of
principal, interest, fees, expenses or otherwise; provided that in the event
that there are undrawn Letters of Credit at such time,

 

(a) if a payment is being made under this clause (ii) as a result of a
distribution made under the Collateral Trust Agreement, the undrawn Letters of
Credit shall be excluded from Obligations in making a ratable payment under this
clause (ii) so long as the Collateral Trustee has retained cash collateral as
security for the undrawn Letters of Credit,, or

 

(b) in all other cases, the payments otherwise payable under this clause (ii)
attributable to the Obligations represented by the undrawn Letters of Credit
shall be retained by the Paying Agent, to be held as cash collateral, for the
ratable portion of the Obligations consisting of undrawn Letters of Credit, it
being understood that (x) if a Letter of Credit is drawn upon, the Paying Agent
shall pay to the Issuing Bank, to the extent necessary to reimburse the Issuing
Bank for such draw, the amount of cash held as collateral for such Letter of
Credit pursuant to this clause and (y) if and to the extent that any Letter of
Credit shall expire or terminate, the amount of cash retained as collateral
therefore pursuant to the application of this clause shall be applied by the
Paying Agent under this clause (ii) to ensure that each of the Obligations shall
receive a ratable share of all payments made subsequent to the date of the
Trigger Event after taking into account the reduction in the Obligations
associated with the termination or expiration of such Letter of Credit; and

 

(iii) the balance, if any, as required by Law.

 

For purposes of determining the proportionate amounts of all Obligations sharing
in any distribution under clause (ii) of this Section 10.13.2, the amount of the
outstanding Obligations attributable to the undrawn amount of all outstanding
Letters of Credit shall be reduced by the amount of cash (specifically excluding
the Tranche B Credit-Linked Deposits) held as collateral therefore by the Paying
Agent or the Collateral Trustee on the date of the Triggering Event.

 

In the event that the sum of all cash held by the Paying Agent and the
Collateral Trustee as collateral for the Letters of Credit plus the Tranche B
Credit-Linked Deposits exceed the undrawn amount of the Letters of Credit, the
Paying Agent may release a portion of the Tranche B Credit-Linked Deposits equal
to the excess amount to be shared among the Lenders in accordance with the
following paragraph. If the Collateral Trustee is holding cash collateral for
the undrawn Letters of Credit and a drawing is made on a Letter of Credit, (1)
the Paying Agent shall request a

 

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distribution of the cash collateral from the Collateral Trustee in accordance
with the Collateral Trust Agreement, and (2) upon the Paying Agent receiving a
distribution of the cash collateral from the Collateral Trustee for such
drawing, the Paying Agent shall ratably pay such distribution among the Lenders
in accordance with the following paragraph.

 

To the extent that monies are payable to the Revolving Lenders or the Tranche B
Lenders under clause (ii) above or released by or paid to the Paying Agent
pursuant to the preceding paragraph (in either case a “Distribution”), the
Lenders agree that such Distribution shall be shared ratably among the Lenders
based upon the sum of the Revolving Exposures and the Tranche B Credit-Linked
Deposits (including any unreimbursed Tranche B Credit-Linked Deposits used to
fund a Tranche B LC Disbursement) in existence at the time of the Triggering
Event. In the event that a Letter of Credit expires or is terminated subsequent
to the date of a Triggering Event, the Distributions payable under this
paragraph shall, in addition to the adjustments occurring under clause (ii)
above, be reallocated among the Lenders so that all Distributions occurring
subsequent to the date of the Triggering Event are shared ratably among the
Lenders based upon the revised Revolving Exposures and the Tranche B
Credit-Linked Deposits. If the Paying Agent shall have insufficient cash
collateral, when combined with Tranche B Credit-Linked Deposits, to reimburse
the Issuing Bank for any drawing on a Letter of Credit, then the Revolving
Lenders shall immediately fund, in proportion to each Revolving Lender’s Ratable
Share, the amount necessary to reimburse the Issuing Bank for such drawing (such
funding by the Revolving Lenders, since previously included in Revolving
Exposures, does not cause any reallocation under this Section 10.13.2 among the
Revolving Lenders and the Tranche B Lenders). To the extent necessary to
effectuate the foregoing allocations among the Lenders, each Lender is deemed to
have granted a ratable participation interest in its Obligations to each of the
other Lenders.

 

To the extent that cash is deposited by the Loan Parties for the Letters of
Credit, whether deposited directly by the Loan Parties, under the Collateral
Trust Agreement or as a result of the distributions set forth in this Section
10.13.2, the Lenders agree that such cash collateral shall be used by the Paying
Agent to reimburse the Issuing Bank for a Draw under any Letter of Credit prior
to applying any of the Tranche B Credit-Linked Deposits in reimbursement
thereof.

 

This Section 10.13.2 is solely for allocating the payments and proceeds among
the Lenders and nothing contained herein shall in any way reduce or alter the
Obligations payable by the Loan Parties.

 

10.14 Successor Agents.

 

Any Co-Administrative Agent or the Paying Agent (i) may resign as
Co-Administrative Agent or Paying Agent, as the case may be, or (ii) shall
resign if such resignation is requested by the Required Lenders (if the
Co-Administrative Agent or the Paying Agent is a Lender, such Co-Administrative
Agent’s or Paying Agent’s Loans and its Commitment shall be considered in
determining whether the Required Lenders have requested such resignation) or
required by Section 5.4.2 [Replacement of a Lender], in either case of (i) or
(ii) by giving not less than thirty (30) days’ prior written notice to the
Borrower. If any Co-Administrative Agent or the Paying Agent shall resign under
this Agreement, then either (a) the Required Lenders shall

 

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appoint from among the Lenders a successor to such Co-Administrative Agent or
such Paying Agent for the Lenders, subject to the consent of the Borrower, such
consent not to be unreasonably withheld, or (b) if a successor Co-Administrative
Agent or Paying Agent shall not be so appointed and approved within the thirty
(30) day period following a Co-Administrative Agent’s or Paying Agent’s notice
to the Lenders of its resignation, then the resigning Co-Administrative Agent or
the resigning Paying Agent, as the case may be, shall appoint, with the consent
of the Borrower, such consent not to be unreasonably withheld, a successor
Co-Administrative Agent or Paying Agent who shall serve as a Co-Administrative
Agent or Paying Agent, as the case may be, until such time as the Required
Lenders appoint and the Borrower consents to the appointment of a successor to
such resigning Co-Administrative Agent or Paying Agent. Upon its appointment
pursuant to either clause (a) or (b) above, such successor Co-Administrative
Agent or Paying Agent shall succeed to the rights, powers and duties of the
resigning Co-Administrative Agent or Paying Agent, as the case may be, and the
terms “Co-Administrative Agent” and “Paying Agent” shall mean such successor
Co-Administrative Agent or Paying Agent, as the case may be, effective upon its
appointment, and the former Co-Administrative Agent’s or Paying Agent’s rights,
powers and duties as Co-Administrative Agent or Paying Agent shall be terminated
without any other or further act or deed on the part of such former
Co-Administrative Agent or Paying Agent or any of the parties to this Agreement.
After the resignation of any Co-Administrative Agent or any Paying Agent
hereunder, the provisions of this Section 10 shall inure to the benefit of such
former Paying Agent and each former Co-Administrative Agent and such former
Paying Agent and each former Co-Administrative Agent shall not by reason of such
resignation be deemed to be released from liability for any actions taken or not
taken by it while it was an Paying Agent or a Co-Administrative Agent under this
Agreement.

 

10.15 Agent’s Fee.

 

The Borrower shall pay to the Paying Agent a nonrefundable fee (the “Agent’s
Fee”) under the terms of a letter (the “Paying Agent’s Letter”) between the
Borrower and Paying Agent, as amended from time to time.

 

10.16 Availability of Funds.

 

The Paying Agent may assume that each Lender has made or will make the proceeds
of a Loan available to the Paying Agent unless the Paying Agent shall have been
notified by such Lender on or before the later of (1) the close of Business on
the Business Day preceding the Borrowing Date with respect to such Loan or two
(2) hours before the time on which the Paying Agent actually funds the proceeds
of such Loan to the Borrower (whether using its own funds pursuant to this
Section 10.16 or using proceeds deposited with the Paying Agent by the Lenders
and whether such funding occurs before or after the time on which Lenders are
required to deposit the proceeds of such Loan with the Paying Agent). The Paying
Agent may, in reliance upon such assumption (but shall not be required to), make
available to the Borrower a corresponding amount. If such corresponding amount
is not in fact made available to the Paying Agent by such Lender, the Paying
Agent shall be entitled to recover such amount on demand from such Lender (or,
if such Lender fails to pay such amount forthwith upon such demand from the
Borrower) together with interest thereon, in respect of each day during the
period commencing

 

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on the date such amount was made available to the Borrower and ending on the
date the Paying Agent recovers such amount, at a rate per annum equal to (i) the
Federal Funds Effective Rate during the first three (3) days after such interest
shall begin to accrue and (ii) the applicable interest rate in respect of such
Loan after the end of such three-day period.

 

10.17 Calculations.

 

In the absence of gross negligence or willful misconduct, the Paying Agent shall
not be liable for any error in computing the amount payable to any Lender
whether in respect of the Loans, fees or any other amounts due to the Lenders
under this Agreement. In the event an error in computing any amount payable to
any Lender is made, the Paying Agent, the Borrower and each affected Lender
shall, forthwith upon discovery of such error, make such adjustments as shall be
required to correct such error, and any compensation therefor will be calculated
at the Federal Funds Effective Rate.

 

10.18 No Reliance on Agents’ Customer Identification Program.

 

Each Lender acknowledges and agrees that neither such Lender, nor any of its
Affiliates, participants or assignees, may rely on the Paying Agent or any
Co-Administrative Agent to carry out such Lender’s, Affiliate’s, participant’s
or assignee’s customer identification program, or other obligations required or
imposed under or pursuant to the USA Patriot Act or the regulations thereunder,
including the regulations contained in 31 CFR 103.121 (as hereafter amended or
replaced, the “CIP Regulations”), or any other Anti-Terrorism Law, including any
programs involving any of the following items relating to or in connection with
any of the Loan Parties, their Affiliates or their agents, the Loan Documents or
the transactions hereunder or contemplated hereby: (1) any identity verification
procedures, (2) any recordkeeping, (3) comparisons with government lists, (4)
customer notices or (5) other procedures required under the CIP Regulations or
such other Laws.

 

10.19 Beneficiaries.

 

Except as expressly provided herein, the provisions of this Section 10 are
solely for the benefit of the Paying Agent, each Co-Administrative Agent and the
Lenders, and the Loan Parties shall not have any rights to rely on or enforce
any of the provisions hereof. In performing their respective functions and
duties under this Agreement, the Paying Agent and each Co-Administrative Agent
shall act solely as Paying Agent or Co-Administrative Agent, as the case may be,
of the Lenders and do not assume and shall not be deemed to have assumed any
obligation toward or relationship of agency or trust with or for any of the Loan
Parties.

 

10.20 Certain Releases of Guarantors and Collateral.

 

It is expressly agreed by each Lender, that upon the written request of the
Borrower (accompanied by such certificates and other documentation as the Paying
Agent may reasonably request) the Paying Agent on behalf of the Lenders and
without any consent or action by any Lender, may, so long as no Event of Default
exists after giving effect thereto, release, or consent to the release by the
Collateral Trustee of, any Collateral or any Guarantor from a

 

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Guaranty Agreement, in either case, in connection with any sale, transfer,
lease, disposition, merger or other transaction permitted by this Agreement
(including without limitation, a release of Accounts or contracts giving rise to
Accounts from time to time in connection with the Permitted Receivables
Financing); provided, however, that the provisions set forth in this Section
10.20 apply only to releases of Collateral or releases of any Guarantor where
this Agreement does not otherwise expressly provide for the consent or approval
of all Lenders or the Super-Majority Lenders. (By way of example, the provisions
of this Section 10.20 would not apply to any release of less than substantially
all of the assets of any Loan Party, which release, in accordance with Section
11.1.3 [Release of Collateral], would require the consent of the Super-Majority
Lenders.).

 

10.21 Certain Matters Regarding the Collateral Trust Agreement.

 

(a) Each Lender and each Co-Administrative Agent, by its execution and delivery
of this Agreement, hereby authorizes the Paying Agent to take all actions under
or in connection with the Collateral Trust Agreement required to be taken by the
Paying Agent on behalf of such Lender or Co-Administrative Agent under the
Collateral Trust Agreement.

 

(b) Each Loan Party, by its execution and delivery of this Agreement, hereby
authorizes the Paying Agent to contact any of the Secured Parties to obtain the
“Payment Information” as defined in the Collateral Trust Agreement, pursuant to
a request of the Collateral Trustee.

 

11. MISCELLANEOUS

 

11.1 Modifications, Amendments or Waivers.

 

With the written consent of the Required Lenders, the Paying Agent, acting on
behalf of all the Lenders, and the Borrower, on behalf of the Loan Parties, may
from time to time enter into written agreements amending or changing any
provision of this Agreement or any other Loan Document or the rights of the
Lenders or the Loan Parties hereunder or thereunder, or may grant written
waivers or consents to a departure from the due performance of the Obligations
of the Loan Parties hereunder or thereunder. Any such agreement, waiver or
consent made with such written consent shall be effective to bind all the
Lenders and the Loan Parties; provided, that no such agreement, waiver or
consent may be made which will:

 

11.1.1 Increase of Commitment; Extension of Revolving Expiration Date;
Modification of Terms of Payment.

 

without the written consent of the Lenders affected thereby, increase the amount
of the Revolving Credit Commitment or Swing Loan Commitment of such Lender
hereunder, extend the Revolving Expiration Date, whether or not any Revolving
Credit Loans are outstanding, or without the written consent of all Lenders with
a Revolving Credit Commitment, extend the time for payment of principal or
interest of any Revolving Credit Loan or any fee payable to any Lender that has
a Revolving Credit Commitment, reduce the principal amount of or the rate of
interest borne by any Revolving Credit Loan or the Swing Loan, reduce the rate
of

 

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any fee payable to any Lender that has a Revolving Credit Commitment or Swing
Loan Commitment;

 

11.1.2 Tranche B Credit-Linked Deposits; Extension of Tranche B Maturity Date;
Modification of Terms of Payment.

 

without the written consent of all the Lenders affected thereby, extend the date
for repayment of any LC Disbursement or extend the date on which the Tranche B
Credit-Linked Deposits are to be returned to the Tranche B Lenders (including
the Tranche B Maturity Date)or any fee payable to any Tranche B Lender, reduce
the amount of or the rate of interest borne by the Tranche B Credit-Linked
Deposits or in connection with a Tranche B LC Disbursement, reduce the rate of
any fee payable to any Tranche B Lender that has made a Tranche B Credit-Linked
Deposit;

 

11.1.3 Release of Collateral.

 

except as provided in Section 10.20 [Certain Releases of Guarantors and
Collateral] and without the written consent of: (i) the Super-Majority Lenders,
release any Collateral (including any Collateral consisting of capital stock or
other ownership interests of any Loan Party or its Subsidiaries) that consists
of less than all or substantially all of the assets of any Loan Party, or (ii)
all the Lenders, release any Collateral (including any Collateral consisting of
capital stock or other ownership interests of any Loan Party or its
Subsidiaries) that consists of all or substantially all of the assets of any
Loan Party, provided that the foregoing consents shall be required in connection
with any sale, transfer, lease, disposition, merger or other transaction
otherwise permitted by this Agreement;

 

11.1.4 Release of Guarantor.

 

except as provided in Section 10.20 [Certain Releases of Guarantors and
Collateral] and without the written consent of all Lenders, except in connection
with any sale, transfer, lease, disposition, merger or other transaction
permitted by this Agreement, release any Guarantor from its Obligations under
the Guaranty Agreement; or

 

11.1.5 Relative Rights Among Lenders.

 

without the consent of a majority in interest of the Lenders adversely affected
thereby, waive, amend, or modify any of the terms of the Loan Documents which
adversely affect the rights in respect of payments, collateral or other rights
as between the Revolving Lenders and the Tranche B Lenders.

 

11.1.6 Miscellaneous.

 

without the written consent of all Lenders, amend Section 5.2 [Pro Rata
Treatment of Lenders], 10.6 [Exculpatory Provisions, Etc.] or 10.13
[Equalization of Lenders] or this Section 11.1, alter any provision regarding
the pro rata treatment of the Lenders, change the definition of Required
Lenders, change the definition of Super-Majority Lenders, or change any

 

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requirement providing for the Lenders, the Required Lenders, or the
Super-Majority Lenders to authorize the taking of any action hereunder;

 

provided, further, that no agreement, waiver or consent which would modify the
interests, rights or obligations of the Paying Agent in its capacity as Paying
Agent or as the issuer of Letters of Credit shall be effective without the
written consent of the Paying Agent.

 

11.2 No Implied Waivers; Cumulative Remedies; Writing Required.

 

No course of dealing and no delay or failure of the Paying Agent or any Lender
in exercising any right, power, remedy or privilege under this Agreement or any
other Loan Document shall affect any other or future exercise thereof or operate
as a waiver thereof, nor shall any single or partial exercise thereof or any
abandonment or discontinuance of steps to enforce such a right, power, remedy or
privilege preclude any further exercise thereof or of any other right, power,
remedy or privilege. The rights and remedies of the Paying Agent and the Lenders
under this Agreement and any other Loan Documents are cumulative and not
exclusive of any rights or remedies which they would otherwise have. Any waiver,
permit, consent or approval of any kind or character on the part of any Lender
of any breach or default under this Agreement or any such waiver of any
provision or condition of this Agreement must be in writing and shall be
effective only to the extent specifically set forth in such writing.

 

11.3 Reimbursement and Indemnification of Lenders by the Borrower; Taxes.

 

The Borrower agrees unconditionally upon demand to pay or reimburse to each
Lender (other than the Paying Agent or any Co-Administrative Agent, as to which
the Borrower’s Obligations are set forth in Section 10.5 [Reimbursement and
Indemnification of Agents by the Borrower]) and to save such Lender harmless
against (i) liability for the payment of all reasonable out-of-pocket costs,
expenses and disbursements (including reasonable fees and expenses of counsel
for each Lender except with respect to (a) and (b) below), incurred by such
Lender (a) in connection with the administration and interpretation of this
Agreement, and other instruments and documents to be delivered hereunder, (b)
relating to any amendments, waivers or consents pursuant to the provisions
hereof, (c) in connection with the enforcement of this Agreement or any other
Loan Document, or collection of amounts due hereunder or thereunder or the proof
and allowability of any claim arising under this Agreement or any other Loan
Document, whether in bankruptcy or receivership proceedings or otherwise, and
(d) in any workout or restructuring or in connection with the protection,
preservation, exercise or enforcement of any of the terms hereof or of any
rights hereunder or under any other Loan Document or in connection with any
foreclosure, collection or bankruptcy proceedings, or (ii) all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever which may be imposed
on, incurred by or asserted against such Lender, in its capacity as such, in any
way relating to or arising out of this Agreement or any other Loan Documents or
any action taken or omitted by such Lender hereunder or thereunder, provided
that the Borrower shall not be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements (A) if the same results from such Lender’s gross
negligence or willful misconduct, or (B) if the Borrower was not given notice of
the subject claim and the opportunity to participate

 

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in the defense thereof, at its expense (except that the Borrower shall remain
liable to the extent such failure to give notice does not result in a loss to
the Borrower), or (C) if the same results from a compromise or settlement
agreement entered into without notice to or the consent of the Borrower, which
consent shall not be unreasonably withheld. The Lenders will attempt to minimize
the fees and expenses of legal counsel for the Lenders which are subject to
reimbursement by the Borrower hereunder by considering the usage of one law firm
to represent the Lenders, each Co-Administrative Agent and the Paying Agent if
appropriate under the circumstances. The Borrower agrees unconditionally to pay
all stamp, document, transfer, recording or filing taxes or fees and similar
impositions now or hereafter determined by the Paying Agent or any Lender to be
payable in connection with this Agreement or any other Loan Document, and the
Borrower agrees unconditionally to save each Co-Administrative Agent, the Paying
Agent and the Lenders harmless from and against any and all present or future
claims, liabilities or losses with respect to or resulting from any omission to
pay or delay in paying any such taxes, fees or impositions.

 

11.4 Holidays.

 

Whenever payment of a Loan to be made or taken hereunder shall be due on a day
which is not a Business Day such payment shall be due on the next Business Day
(except as provided in Section 4.2 [Interest Periods] with respect to Interest
Periods under the Euro-Rate Option) and such extension of time shall be included
in computing interest and fees, except that the Loans shall be due on the
Business Day preceding the Revolving Expiration Date if the Revolving Expiration
Date is not a Business Day. Whenever any payment or action to be made or taken
hereunder (other than payment of the Loans) shall be stated to be due on a day
which is not a Business Day, such payment or action shall be made or taken on
the next following Business Day, and such extension of time shall not be
included in computing interest or fees, if any, in connection with such payment
or action.

 

11.5 Funding by Branch, Subsidiary or Affiliate.

 

11.5.1 Notional Funding.

 

Each Lender shall have the right from time to time, without notice to the
Borrower, to deem any branch, Subsidiary or Affiliate (which for the purposes of
this Section 11.5 shall mean any corporation or association which is directly or
indirectly controlled by or is under direct or indirect common control with any
corporation or association which directly or indirectly controls such Lender) of
such Lender to have made, maintained or funded any Loan to which the Euro-Rate
Option applies at any time, provided that immediately following (on the
assumption that a payment were then due from the Borrower to such other office),
and as a result of such change, the Borrower would not be under any greater
financial obligation under this Agreement than it would have been in the absence
of such change. Notional funding offices may be selected by each Lender without
regard to such Lender’s actual methods of making, maintaining or funding the
Loans or any sources of funding actually used by or available to such Lender.

 

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11.5.2 Actual Funding.

 

Each Lender shall have the right from time to time to make or maintain any Loan
by arranging for a branch, Subsidiary or Affiliate of such Lender to make or
maintain such Loan subject to the last sentence of this Section 11.5.2. If any
Lender causes a branch, Subsidiary or Affiliate to make or maintain any part of
the Loans hereunder, all terms and conditions of this Agreement shall, except
where the context clearly requires otherwise, be applicable to such part of the
Loans to the same extent as if such Loans were made or maintained by such
Lender, but in no event shall any Lender’s use of such a branch, Subsidiary or
Affiliate to make or maintain any part of the Loans hereunder cause such Lender
or such branch, Subsidiary or Affiliate to incur any cost or expenses payable by
the Borrower hereunder or require the Borrower to pay any other compensation to
any Lender (including any expenses incurred or payable pursuant to Section 5.6
[Additional Compensation in Certain Circumstances]) which would otherwise not be
incurred.

 

11.6 Notices.

 

Any notice, request, demand, direction or other communication (for purposes of
this Section 11.6 only, a “Notice”) to be given to or made upon any party hereto
under any provision of this Agreement shall be given or made by telephone or in
writing (which includes means of electronic transmission (i.e., “e-mail”) or
facsimile transmission or by setting forth such Notice on a site on the World
Wide Web (a “Website Posting”) if Notice of such Website Posting (including the
information necessary to access such site) has previously been delivered to the
applicable parties hereto by another means set forth in this Section 11.6) in
accordance with this Section 11.6. Any such Notice must be delivered to the
applicable parties hereto at the addresses and numbers set forth under their
respective names on Schedule 1.1(B) hereof or in accordance with any subsequent
unrevoked Notice from any such party that is given in accordance with this
Section 11.6. Any Notice shall be effective:

 

(i) In the case of hand-delivery, when delivered;

 

(ii) If given by mail, four days after such Notice is deposited with the United
States Postal Service, with first-class postage prepaid, return receipt
requested;

 

(iii) In the case of a telephonic Notice, when a party is contacted by
telephone, if delivery of such telephonic Notice is confirmed no later than the
next Business Day by hand delivery, a facsimile or electronic transmission, a
Website Posting or overnight courier delivery of a confirmatory notice (received
at or before noon on such next Business Day);

 

(iv) In the case of a facsimile transmission, when sent to the applicable
party’s facsimile machine’s telephone number if the party sending such Notice
receives confirmation of the delivery thereof from its own facsimile machine;

 

(v) In the case of electronic transmission, when actually received;

 

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(vi) In the case of a Website Posting, upon delivery of a Notice of such posting
(including the information necessary to access such web site) by another means
set forth in this Section 11.6; and

 

(vii) If given by any other means (including by overnight courier), when
actually received.

 

Any Lender giving a Notice to a Loan Party shall concurrently send a copy
thereof to the Paying Agent, and the Paying Agent shall promptly notify the
other Lenders of its receipt of such Notice.

 

11.7 Severability.

 

The provisions of this Agreement are intended to be severable. If any provision
of this Agreement shall be held invalid or unenforceable in whole or in part in
any jurisdiction, such provision shall, as to such jurisdiction, be ineffective
to the extent of such invalidity or unenforceability without in any manner
affecting the validity or enforceability thereof in any other jurisdiction or
the remaining provisions hereof in any jurisdiction.

 

11.8 Governing Law.

 

Each Letter of Credit and Section 2.9 [Letter of Credit Subfacility] shall be
subject to the Uniform Customs and Practice for Documentary Credits (1993
Revision), International Chamber of Commerce Publication No. 500, as the same
may be revised or amended from time to time, and to the extent not inconsistent
therewith, the internal laws of the Commonwealth of Pennsylvania without regard
to its conflict of laws principles, and the balance of this Agreement shall be
deemed to be a contract under the Laws of the Commonwealth of Pennsylvania and
for all purposes shall be governed by and construed and enforced in accordance
with the internal laws of the Commonwealth of Pennsylvania without regard to its
conflict of laws principles.

 

11.9 Prior Understanding.

 

This Agreement and the other Loan Documents supersede all prior understandings
and agreements, whether written or oral, between the parties hereto and thereto
relating to the transactions provided for herein and therein, including any
prior confidentiality agreements and commitments.

 

11.10 Duration; Survival.

 

All representations and warranties of the Loan Parties contained herein or made
in connection herewith shall survive the making of Loans, funding of the Tranche
B Credit-Linked Deposits and issuance of Letters of Credit and shall not be
waived by the execution and delivery of this Agreement, any investigation by any
Co-Administrative Agent, the Paying Agent or the Lenders, the making of Loans,
funding of the Tranche B Credit-Linked Deposits, issuance of Letters of Credit,
payment in full of the Loans or return of the Tranche B Credit-Linked Deposits .
All covenants and agreements of the Loan Parties contained in Sections 8.1
[Affirmative Covenants], 8.2 [Negative Covenants] and 8.3 [Reporting
Requirements] herein shall

 

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continue in full force and effect from and after the date hereof so long as the
Borrower may borrow or request Letters of Credit hereunder and until termination
of the Commitments and payment in full of the Loans, return of the Tranche B
Credit-Linked Deposits and expiration or termination of all Letters of Credit.
All covenants and agreements of the Borrower contained herein relating to the
payment of principal, interest, premiums, additional compensation or expenses
and indemnification, including those set forth in the Notes, Section 5
[Payments] and Sections 10.5 [Reimbursement and Indemnification of Agents by the
Borrower, Etc.], 10.7 [Reimbursement and Indemnification of Agents by Lenders]
and 11.3 [Reimbursement of Lenders and Indemnification of Lenders by the
Borrower; Taxes], shall survive payment in full of the Loans, return of the
Tranche B Credit-Linked Deposits, expiration or termination of the Letters of
Credit and termination of the Commitments.

 

11.11 Successors and Assigns.

 

(i) This Agreement shall be binding upon and shall inure to the benefit of the
Lenders, the Paying Agent, each Co-Administrative Agent, the Loan Parties and
their respective successors and assigns, except that none of the Loan Parties
may assign or transfer any of its rights and Obligations hereunder or any
interest herein. Each Lender may, at its own cost, make assignments of or sell
participations in all or any part of its Commitments, the Loans or the Tranche B
Credit-Linked Deposits made by it to an Eligible Assignee, subject to the
consent of the Borrower and the Paying Agent with respect to any assignment to
an Eligible Assignee, such consent not to be unreasonably withheld, provided
that (1) no consent of the Borrower shall be required if an Event of Default
exists and is continuing, (2) any assignment by a Lender to a Person other than
an Affiliate of such Lender or any Approved Fund of such Lender may not be made
in amounts less than the lesser of (a) $5,000,000 or the amount of the assigning
Lender’s Revolving Credit Commitment for Revolving Credit Loans or (b)
$1,000,000 or the amount of the assigning Lender’s Tranche B Credit-Linked
Deposits, (3) any assignment by a Lender of its Loans or its Commitments or
Tranche B Credit-Linked Deposits to any other Lender may be made without the
consent of either of the Borrower or the Paying Agent upon written notice of
such assignment to the Paying Agent and compliance with the terms and conditions
of this Section, and (4) any assignment by a Lender of its Loans or its
Commitments or Tranche B Credit-Linked Deposits to an Affiliate of such Lender
or to any Approved Fund of such Lender may be made without the consent of either
of the Borrower or the Paying Agent upon written notice of such assignment to
the Paying Agent and compliance with the terms and conditions of this Section
(including the requirement that such Affiliate be an Eligible Assignee).
Notwithstanding the foregoing, in the event that the Lender is assigning its
entire remaining amount of Lender’s Commitment and outstanding Loans or Tranche
B Credit-Linked Deposits, the amounts specified in the immediately preceding
clause (2)(a) or (2)(b) shall not be applicable. Without the consent of the
Borrower (which consent shall not be unreasonably withheld) and the Paying
Agent, the Tranche B Credit-Linked Deposit of any Tranche B Lender shall not be
released in connection with any assignment by such Tranche B Lender, but shall
instead be purchased by the relevant Eligible Assignee and continue to be held
for application (to the extent not already applied) in accordance with Section
2.9.1 [Revolving Letter of Credit Fees] to satisfy such Eligible Assignee’s
obligations in respect of Tranche

 

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B LC Disbursements. In the case of an assignment, upon receipt by the Paying
Agent of the Assignment and Assumption Agreement, the Eligible Assignee shall
have, to the extent of such assignment (unless otherwise provided therein), the
same rights, benefits and obligations as it would have if it had been a
signatory Lender hereunder, the Commitments shall be adjusted accordingly, and
upon surrender of any Note subject to such assignment, the Borrower shall
execute and deliver a new Note to the Eligible Assignee in an amount equal to
the amount of the Revolving Credit Commitment assumed by it and a new Revolving
Credit Note to the assigning Lender in an amount equal to the Revolving Credit
Commitment retained by it hereunder. Each partial assignment shall be made as an
assignment of a proportionate part of all of the assigning Lender’s rights and
obligations under this Agreement; provided that this clause shall not be
construed to prohibit the assignment of a proportionate part of all the
assigning Lender’s rights and obligations whether in respect of any one of its
Revolving Credit Commitment, its Swing Loan Commitment or its Tranche B
Credit-Linked Deposit, or Loans. Any Lender that assigns any or all of its
Commitment or Tranche B Credit-Linked Deposits or Loans to a Person other than
an Affiliate of such Lender or an Approved Fund of such Lender shall pay to the
Paying Agent a service fee in the amount of $3,500 for each assignment. In the
case of a participation, the participant shall only have the rights specified in
Section 9.2.3 [Set-off] (the participant’s rights against such Lender in respect
of such participation to be those set forth in the agreement executed by such
Lender in favor of the participant relating thereto and not to include any
voting rights except with respect to changes of the type referenced in Sections
11.1.1 [Increase of Revolving Credit Commitment, Etc.], 11.1.2 [Tranche B
Credit-Linked Deposits, Etc.], 11.1.3 [Release of Collateral], or 11.1.4
[Release of Guarantor]), all of such Lender’s obligations under this Agreement
or any other Loan Document shall remain unchanged, and all amounts payable by
any Loan Party hereunder or thereunder shall be determined as if such Lender had
not sold such participation.

 

(ii) Any Eligible Assignee or participant which is not incorporated under the
Laws of the United States of America or a state thereof shall deliver to the
Borrower and the Paying Agent the form of certificate described in Section
11.17.1 [Tax Withholding] relating to federal income tax withholding. Each
Lender may furnish any publicly available information concerning any Loan Party
or its Subsidiaries and any other information concerning any Loan Party or its
Subsidiaries in the possession of such Lender from time to time to Eligible
Assignees and participants (including prospective Eligible Assignees or
participants), provided that such Eligible Assignees and participants agree to
be bound by the provisions of Section 11.12 [Confidentiality].

 

(iii) Notwithstanding any other provision in this Agreement, any Approved Fund
or any Lender that is a fund that invests in bank loans, may at any time,
collaterally assign, pledge or grant a security interest in all or any portion
of its rights under this Agreement, its Notes and the other Loan Documents
(including the Obligations), to any Eligible Assignee or to any Person that is
capable of being qualified as an Eligible Assignee where such Person is a holder
of, trustee for, or any other representative of holders of, obligations owed or
securities issued, by such fund, as security for such obligations or securities
(the “Pledgee”), provided that such Pledgee cannot assign its

 

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interests under this Agreement unless to an Eligible Assignee pursuant to this
Section 11.11.

 

(iv) Notwithstanding any other provision in this Agreement, any Lender may at
any time pledge or grant a security interest in all or any portion of its rights
under this Agreement, its Note and the other Loan Documents to any Federal
Reserve Lender in accordance with Regulation A of the FRB or U.S. Treasury
Regulation 31 CFR Section 203.14 without notice to or consent of the Borrower or
the Paying Agent. No such pledge or grant of a security interest shall release
the transferor Lender of its obligations hereunder or under any other Loan
Document.

 

(v) Notwithstanding anything to the contrary contained herein, any Lender (a
“Designating Lender”) may grant to one or more special purpose funding vehicles
so long as such funding vehicles are Eligible Assignees (each, an “SPV”),
identified as such in writing from time to time by the Designated Lender to the
Paying Agent and the Borrower, the option to provide to the Borrower all or any
part of the Tranche B Credit-Linked Deposit that such Designating Lender would
otherwise be obligated pursuant to this Agreement; provided that (x) nothing
herein shall constitute a commitment by any SPV to make the Tranche B
Credit-Linked Deposit, (y) if an SPV elects not to exercise such option or
otherwise fails to provide all or any part of the Tranche B Credit-Linked
Deposit, the Designating Lender shall be obligated to make the Tranche B
Credit-Linked Deposit pursuant to the terms hereof and (z) the Designating
Lender shall remain liable for any indemnity or other payment obligation with
respect to its Commitment hereunder. The making of the Tranche B Credit-Linked
Deposit by an SPV hereunder shall utilize the Commitment of the Designating
Lender to the same extent, and as if, the Tranche B Credit-Linked Deposit were
made by such Designating Lender.

 

(vi) As to the Tranche B Credit-Linked Deposit or portion thereof made by it,
each SPV shall have all the rights that a Lender making the Tranche B
Credit-Linked Deposit or portion thereof would have had under this Agreement;
provided, however, that each SPV shall have granted to its Designating Lender an
irrevocable power of attorney, to deliver and receive all communications and
notices under this Agreement (and any Loan Documents) and to exercise, on such
SPV’s behalf, all of such SPV’s voting rights under this Agreement. In addition,
any returns of the Tranche B Credit-Linked Deposit for the account of any SPV
shall be paid to its Designating Lender as agent for such SPV. Notwithstanding
any term or condition hereof, no SPV, unless it shall have become a Lender
hereunder in accordance with the terms of Section 11.11(i), shall be a party
hereto or have any right to vote or give or withhold its consent under this
Agreement. The Paying Agent shall have no duty or obligation to give any notices
required to be delivered hereunder to any SPV.

 

(vii) Each party hereto hereby agrees that no SPV shall be liable for any
indemnity or payment under this Agreement for which a Lender would otherwise be
liable. In furtherance of the foregoing, each party hereto hereby agrees (which
agreements shall survive the termination of this Agreement) that, prior to the
date that is one year and one day after the later of (x) payment in full of all
outstanding commercial paper or other

 

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senior indebtedness of any SPV, (y) the return of all Tranche B Credit-Linked
Deposits, and (z) the termination of all Commitments, it will not institute
against, or join any other person in instituting against, such SPV any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings
under the laws of the United States or any State thereof, provided that the
Designating Lender for each SPV hereby agrees to indemnify, save and hold
harmless each other party hereto for any loss, cost, damage and expense arising
out of the inability to institute any such proceeding against such SPV.

 

(viii) In addition, notwithstanding anything to the contrary contained in this
Section 11.11(viii) or otherwise in this Agreement (other than the proviso set
forth directly below in this Section 11.11(viii), any SPV may (y) with notice
to, but without the prior written consent of the Borrower or the Paying Agent,
at any time and without paying any processing fee therefor, assign or
participate all or a portion of its interest in the Tranche B Credit-Linked
Deposit to the Designating Lender or to any financial institutions providing
liquidity and/or credit support to or for the account of such SPV to support the
funding or maintenance of the Tranche B Credit-Linked Deposit and (z) disclose
on a confidential basis any non public information relating to its Tranche B
Credit-Linked Deposit to any rating agency, commercial paper dealer or provider
of any surety, guarantee or credit or liquidity enhancements to such SPV;
provided, however, that in no event may any public financial information
provided by the Borrower under Section 8.3 [Reporting Requirements] be provided
by any SPV to any other Person. This Section 11.11(viii) may not be amended
without the written consent of any Designating Lender affected thereby.

 

11.12 Confidentiality.

 

11.12.1 General.

 

The Paying Agent, the Co-Administrative Agents and the Lenders each agree to
keep confidential all information obtained from any Loan Party or its
Subsidiaries which is nonpublic and confidential or proprietary in nature
(including any information the Borrower specifically designates as
confidential), except as provided below, and to use such information only in
connection with their respective capacities under this Agreement and for the
purposes contemplated hereby. The Paying Agent, the Co-Administrative Agents and
the Lenders shall be permitted to disclose such information (i) to outside legal
counsel, accountants and other professional advisors who need to know such
information in connection with the administration and enforcement of this
Agreement, subject to agreement of such Persons to maintain the confidentiality,
(ii) to Eligible Assignees and participants as contemplated by Section 11.11
[Successors and Assigns], and prospective Eligible Assignees and participants
that agree to be bound by this confidentiality provision, (iii) to the extent
requested by any bank regulatory authority insurance company regulatory
authority or, with notice to the Borrower, as otherwise required by applicable
Law or by any subpoena or similar legal process, or in connection with any
investigation or proceeding arising out of the transactions contemplated by this
Agreement, (iv) if it becomes publicly available other than as a result of a
breach of this Agreement or becomes available from a source not known to be
subject to confidentiality restrictions, (v) the National Association of
Insurance Commissioners or any similar organization, or any nationally
recognized

 

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rating agency that requires access to information about the Lender’s investment
portfolio, (vi) in connection with the exercise, preservation or protection of
any right or remedy hereunder or under the other Loan Documents, applicable law
or equity or (vii) if the Borrower shall have consented to such disclosure.
Notwithstanding anything herein to the contrary, the information subject to this
Section 11.12.1 shall not include, and the Paying Agent, each Co-Administrative
Agent and each Lender may disclose without limitation of any kind, any
information with respect to the “tax treatment” and “tax structure” (in each
case, within the meaning of Treasury Regulation Section 1.6011-4) of the
transactions contemplated hereby and all materials of any kind (including
opinions or other tax analyses) that are provided to the Paying Agent, such
Co-Administrative Agent or such Lender relating to such tax treatment and tax
structure; provided that with respect to any document or similar item that in
either case contains information concerning the tax treatment or tax structure
of the transaction as well as other information, this sentence shall only apply
to such portions of the document or similar item that relate to the tax
treatment or tax structure of the Loans, Letters of Credit and transactions
contemplated hereby.

 

11.12.2 Sharing Information With Affiliates of the Lenders.

 

Each Loan Party acknowledges that from time to time financial advisory,
investment banking and other services may be offered or provided to the Borrower
or one or more of its Affiliates (in connection with this Agreement or
otherwise) by any Lender or by one or more Subsidiaries or Affiliates of such
Lender and each of the Loan Parties hereby authorizes each Lender to share any
information delivered to such Lender by such Loan Party and its Subsidiaries
pursuant to this Agreement, or in connection with the decision of such Lender to
enter into this Agreement, to any such Subsidiary or Affiliate of such Lender,
it being understood that any such Subsidiary or affiliate of any Lender
receiving such information shall be bound by the provisions of Section 11.12.1
[General] as if it were a Lender hereunder. Such authorization shall survive the
repayment of the Loans and other Obligations and the termination of the
Commitments.

 

11.13 Counterparts.

 

This Agreement may be executed by different parties hereto on any number of
separate counterparts, each of which, when so executed and delivered, shall be
an original, and all such counterparts shall together constitute one and the
same instrument. Delivery of an executed signature page by telecopy or
electronic signature delivery system (in either case in a form acceptable to the
Paying Agent) shall be effective as delivery of a manually executed signature
page to this Agreement and to the Assignment and Assumption Agreement.

 

11.14 [Intentionally Omitted.]

 

11.15 Exceptions.

 

The representations, warranties and covenants contained herein shall be
independent of each other, and no exception to any representation, warranty or
covenant shall be deemed to be an exception to any other representation,
warranty or covenant contained herein

 

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unless expressly provided, nor shall any such exceptions be deemed to permit any
action or omission that would be in contravention of applicable Law.

 

11.16 CONSENT TO FORUM; WAIVER OF JURY TRIAL.

 

EACH LOAN PARTY HEREBY IRREVOCABLY CONSENTS TO THE NONEXCLUSIVE JURISDICTION OF
THE COURT OF COMMON PLEAS OF ALLEGHENY COUNTY AND THE UNITED STATES DISTRICT
COURT FOR THE WESTERN DISTRICT OF PENNSYLVANIA, AND WAIVES PERSONAL SERVICE OF
ANY AND ALL PROCESS UPON IT AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS BE
MADE BY CERTIFIED OR REGISTERED MAIL DIRECTED TO SUCH LOAN PARTY AT THE
ADDRESSES PROVIDED FOR IN SECTION 11.6 AND SERVICE SO MADE SHALL BE DEEMED TO BE
COMPLETED UPON ACTUAL RECEIPT THEREOF. EACH LOAN PARTY WAIVES ANY OBJECTION TO
JURISDICTION AND VENUE OF ANY ACTION INSTITUTED AGAINST IT AS PROVIDED HEREIN
AND AGREES NOT TO ASSERT ANY DEFENSE BASED ON LACK OF JURISDICTION OR VENUE.
EACH LOAN PARTY, THE PAYING AGENT AND THE LENDERS HEREBY WAIVE TRIAL BY JURY IN
ANY ACTION, SUIT, PROCEEDING OR COUNTERCLAIM OF ANY KIND ARISING OUT OF OR
RELATED TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE COLLATERAL TO THE FULL
EXTENT PERMITTED BY LAW.

 

11.17 Certifications From Lenders and Participants

 

11.17.1 Tax Withholding.

 

(a) Each Lender or Eligible Assignee or participant of a Lender that is not
incorporated under the Laws of the United States of America or a state thereof
(and, upon the written request of the Paying Agent, each other Lender or
Eligible Assignee or participant of a Lender) agrees that it will deliver to
each of the Borrower and the Paying Agent two (2) duly completed appropriate
valid Withholding Certificates (as defined under § 1.1441-1(c)(16) of the Income
Tax Regulations (the “Regulations”)) certifying its status (i.e. U.S. or foreign
person) and, if appropriate, making a claim of reduced, or exemption from, U.S.
withholding tax on the basis of an income tax treaty or an exemption provided by
the Internal Revenue Code. The term “Withholding Certificate” means a Form W-9;
a Form W-8BEN; a Form W-8ECI; a Form W-8IMY and the related statements and
certifications as required under § 1.1441-1(e)(2) and/or (3) of the Regulations;
a statement described in § 1.871-14(c)(2)(v) of the Regulations; or any other
certificates under the Internal Revenue Code or Regulations that certify or
establish the status of a payee or beneficial owner as a U.S. or foreign person.
Each Lender, Eligible Assignee or participant required to deliver to the
Borrower and the Paying Agent a Withholding Certificate pursuant to the
preceding sentence shall deliver such valid Withholding Certificate as follows:
(A) each Lender which is a party hereto on the Closing Date shall deliver such
valid Withholding Certificate at least five (5) Business Days prior to the first
date on which any interest or fees are payable by the Borrower hereunder for the
account of such Lender; (B) each Eligible Assignee or participant shall deliver
such valid Withholding Certificate at least five (5) Business Days before the
effective date of such assignment or participation (unless the Paying Agent in
its sole

 

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discretion shall permit such Eligible Assignee or participant to deliver such
valid Withholding Certificate less than five (5) Business Days before such date
in which case it shall be due on the date specified by the Paying Agent). Each
Lender, Eligible Assignee or participant which so delivers a valid Withholding
Certificate further undertakes to deliver to each of the Borrower and the Paying
Agent two (2) additional copies of such Withholding Certificate (or a successor
form) on or before the date that such Withholding Certificate expires or becomes
obsolete or after the occurrence of any event requiring a change in the most
recent Withholding Certificate so delivered by it, and such amendments thereto
or extensions or renewals thereof as may be reasonably requested by the Borrower
or the Paying Agent. Notwithstanding the submission of a Withholding Certificate
claiming a reduced rate of or exemption from U.S. withholding tax, the Paying
Agent shall be entitled to withhold United States federal income taxes at the
full 30% withholding rate if in its reasonable judgment it is required to do so
under the due diligence requirements imposed upon a withholding agent under §
1.1441-7(b) of the Regulations. Further, the Paying Agent is indemnified under §
1.1461-1(e) of the Regulations against any claims and demands of any Lender or
Eligible Assignee or participant of a Lender for the amount of any tax it
deducts and withholds in accordance with regulations under § 1441 of the
Internal Revenue Code.

 

(b) If any taxes are required to be withheld from any amounts payable to any
Lender hereunder or under the Notes, Letters of Credit, or with respect to the
Tranche B Credit-Linked Deposits, the amounts payable to such Lender shall be
increased as may be necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section)
such Lender receives an amount equal to the sum it would have received had no
such deductions been made. The Borrower shall not, however, be required to pay
any additional amount pursuant to the preceding sentence to any Lender or any
Eligible Assignee or participant that is not organized under the laws of the
United States of America or any state thereof, if such Lender, Eligible Assignee
or participant fails to comply with the requirements of this Section. Whenever
any taxes are payable by the Borrower, as promptly as possible thereafter the
Borrower shall send to the Paying Agent for the account of such Lender a
certified copy of an original official receipt received by the Borrower showing
payment thereof. If the Borrower fails to pay any taxes when due to the
appropriate taxing authority or fails to remit to the Paying Agent the required
receipts or other required documentary evidence, the Borrower shall indemnify
the Paying Agent, the Co-Administrative Agents and the Lenders for any
incremental taxes, interest or penalties that may become payable by the Paying
Agent or any Lender as a result of any such failure. The agreements in this
section shall survive the termination of this Agreement and the payment in full
of the Obligations hereunder.

 

11.17.2 USA Patriot Act.

 

Each Lender or Eligible Assignee or participant of a Lender that is not
incorporated under the Laws of the United States of America or a state thereof
(and is not excepted from the certification requirement contained in Section 313
of the USA Patriot Act and the applicable regulations because it is both (i) an
affiliate of a depository institution or foreign bank that maintains a physical
presence in the United States or foreign country, and (ii) subject to
supervision by a banking authority regulating such affiliated depository
institution or foreign bank) shall deliver to the Paying Agent the
certification, or, if applicable, recertification, certifying

 

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that such Lender is not a “shell” and certifying to other matters as required by
Section 313 of the USA Patriot Act and the applicable regulations: (1) within 10
days after the Closing Date, and (2) as such other times as are required under
the USA Patriot Act.

 

11.18 Joinder of Guarantors.

 

Any Subsidiary of the Borrower which is required to join this Agreement as a
Guarantor pursuant to Section 8.2.9 [Subsidiaries, Partnerships and Joint
Ventures] shall execute and deliver to the Paying Agent (i) a Guarantor Joinder
in substantially the form attached hereto as Exhibit 1.1(G)(1) pursuant to which
it shall join as a Guarantor each of the documents to which the Guarantors are
parties; (ii) documents in the forms described in Section 7.1 [First Loans,
Etc.] modified as appropriate to relate to such Subsidiary; and (iii) documents
necessary to grant and perfect Prior Security Interests, subject to Permitted
Liens, to the Collateral Trustee for the benefit of the Secured Parties in all
Collateral held by such Subsidiary. The Loan Parties shall deliver such
Guarantor Joinder and related documents to the Paying Agent within twenty (20)
Business Days after (i) if such Subsidiary is newly formed, the date of the
filing of such Subsidiary’s articles of incorporation if the Subsidiary is a
corporation, the date of the filing of its certificate of limited partnership if
it is a limited partnership or the date of its organization if it is an entity
other than a limited partnership or corporation or (ii) if such Subsidiary is an
existing Person newly acquired pursuant to a Permitted Acquisition, the date of
the closing of the transaction constituting such Permitted Acquisition.

 

11.19 Register.

 

The Paying Agent, acting for this purpose as an agent of the Borrower, shall
maintain at its address for notices referred to at Section 11.6 [Notices] a
register (the “Register”) and an account for each Lender in which the Paying
Agent will record the names and addresses of the Lenders and the Commitments of,
and principal amount of the Loans owing to, each Lender from time to time. The
entries in the Register shall be conclusive, in the absence of manifest error,
and the Borrower, the Paying Agent and the Lenders shall treat each Person whose
name is recorded in the Register as the owner of the Commitments and the Loans
recorded therein for all purposes of this Agreement; provided, however that the
failure of the Paying Agent to maintain the Register or an account for any
Lender shall not in any manner affect the obligation of the Borrower to repay
(with applicable interest) the Loans made to the Borrower by such Lender in
accordance with the terms of this Agreement. An assignment of any Loan shall be
effective only upon appropriate entries with respect thereto being made in the
Register. Any assignment or transfer of all or part of a Loan evidenced by a
Note shall be registered on the Register only upon surrender for registration of
assignment or transfer of the Note evidencing such Loan, accompanied by a duly
executed Assignment and Assumption Agreement, and thereupon one or more new
Notes in the same aggregate principal amount shall be issued by the Borrower in
the appropriate amount(s) to the designated Eligible Assignee and the assigning
Lender, if such Lender retains any portion of its Loans, and the old Notes shall
be returned by the Paying Agent to the Borrower marked “replaced.” The Paying
Agent shall maintain a copy of each Assignment and Assumption Agreement
delivered to it as part of the Register. The Register shall be available for
inspection by the Borrower, and the Lenders and their representatives (including
counsel and accountants), at any reasonable time and from time to time upon

 

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reasonable prior notice. Upon its receipt of a duly completed Assignment and
Assumption Agreement executed by an assigning Lender and an Eligible Assignee
and meeting the requirements set forth in Section 11.11 [Successors and Assigns]
hereof, the Paying Agent shall (i) accept such Assignment and Assumption
Agreement, (ii) record the information contained therein in the Register, and
(iii) give prompt notice thereof to the Lenders. Notwithstanding anything to the
contrary contained herein, no assignment under Section 11.11 shall be effective
unless and until the Paying Agent shall have recorded such assignment in the
Register. The Paying Agent shall record the name of the transferor, the name of
the transferee, and the amount of the transfer in the of all documents required
pursuant to Section 11.11 and such other documents as the Paying Agent may
reasonably request.

 

[SIGNATURE PAGE FOLLOWS]

 

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[SIGNATURE PAGE - CREDIT AGREEMENT]

 

IN WITNESS WHEREOF, the parties hereto, by their officers thereunto duly
authorized, have executed this Agreement as of the day and year first above
written.

 

BORROWER:   CONSOL ENERGY INC. By:   /s/    John M. Reilly

Name:

  John M. Reilly

Title:

  Treasurer

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE - CREDIT AGREEMENT]

 

GUARANTORS: CENTRAL OHIO COAL COMPANY CHURCH STREET HOLDINGS, INC. CONSOL
FINANCIAL INC. CONSOL OF CANADA INC. CONSOL OF KENTUCKY INC. CONSOL PENNSYLVANIA
COAL COMPANY CONSOLIDATION COAL COMPANY EIGHTY-FOUR MINING COMPANY HELVETIA COAL
COMPANY IC COAL, INC. ISLAND CREEK COAL COMPANY JEFFCO COAL COMPANY KEYSTONE
COAL MINING CORPORATION LAUREL RUN MINING COMPANY LEATHERWOOD, INC. McELROY COAL
COMPANY NEW CENTURY HOLDINGS, INC. QUARTO MINING COMPANY ROCHESTER & PITTSBURGH
COAL COMPANY SOUTHERN OHIO COAL COMPANY THE WHITE STAR COAL CO., INC. TWIN
RIVERS TOWING COMPANY UNITED EASTERN COAL SALES CORPORATION WINDSOR COAL COMPANY
WOLFPEN KNOB DEVELOPMENT COMPANY By:   /s/    John M. Reilly    

John M. Reilly, Treasurer of each Guarantor listed

above on behalf of each such Guarantor

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE - CREDIT AGREEMENT]

 

GUARANTORS: CNX LAND RESOURCES INC. By:   /s/    William J. Lyons

Name:

  William J. Lyons

Title:

  Vice President and Controller

CNX MARINE TERMINALS INC.

CONSOL DOCKS INC.

By:   /s/    Ronald G. Stovash     Ronald G. Stovash, President of each
Guarantor listed above on behalf of each such Guarantor CONSOL SALES COMPANY By:
  /s/    Ronald G. Stovash

Name:

  Ronald G. Stovash

Title:

  Vice President MTB INC. By:   /s/ William D. Stanhagen

Name:

  William D. Stanhagen

Title:

  President RESERVE COAL PROPERTIES COMPANY By:   /s/    Walter J. Scheller

Name:

  Walter J. Scheller

Title:

  Vice President

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE - CREDIT AGREEMENT]

 

GUARANTORS: TERRA FIRMA COMPANY By:   /s/    James A. Russell

Name:

  James A. Russell

Title:

  President CARDINAL STATES GATHERING COMPANY

By:

 

CONSOLIDATION COAL COMPANY, a

general partner

    By:   /s/    John M. Reilly    

Name:

  John M. Reilly    

Title:

  Treasurer CNX GAS COMPANY LLC

By:

 

CONSOLIDATION COAL COMPANY, its

sole member

    By:   /s/    John M. Reilly    

Name:

  John M. Reilly    

Title:

  Treasurer CONRHEIN COAL COMPANY

By:

 

CONSOLIDATION COAL COMPANY, a

general partner

    By:   /s/    John M. Reilly    

Name:

  John M. Reilly    

Title:

  Treasurer

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE - CREDIT AGREEMENT]

 

GUARANTORS: GREENE ENERGY LLC

By:

 

CONSOLIDATION COAL COMPANY, a

member

    By:   /s/    John M. Reilly    

Name:

  John M. Reilly    

Title:

  Treasurer

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE - CREDIT AGREEMENT]

 

LENDER: BANK OF MONTREAL By:   /s/    Bruce A. Pietka

Name:

   

Title:

   

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE - CREDIT AGREEMENT]

 

LENDER: BNP PARIBAS By:   /s/    Mark A. Cox

Name:

   

Title:

      By:   /s/    Greg Smothers

Name:

   

Title:

   

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE - CREDIT AGREEMENT]

 

LENDER: CALYON NEW YORK BRANCH By:   /s/    Lee E. Grieve

Name:

   

Title:

      By:   /s/    Joseph A. Philbin

Name:

   

Title:

   

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE - CREDIT AGREEMENT]

 

LENDER:

CITICORP NORTH AMERICA, INC.,

individually and as Co-Administrative Agent

By:   /s/    Irina Lorye

Name:

   

Title:

   

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE-CREDIT AGREEMENT]

 

LENDER: CRÉDIT INDUSTRIEL ET COMMERCIAL By:   /s/    Brian
O’Leary        /s/    Marcus Edward

Name:

   

Title:

   

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE - CREDIT AGREEMENT]

 

LENDER: FIRST COMMONWEALTH BANK By:   /s/    Paul J. Oris

Name:

   

Title:

   

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE - CREDIT AGREEMENT]

 

LENDER:

LASALLE BANK NATIONAL ASSOCIATION,

individually and as Co-Documentation Agent

By:

  /s/    Philip R. Medsger

Name:

   

Title:

   

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE - CREDIT AGREEMENT]

 

LENDER: NATIONAL CITY BANK OF PENNSYLVANIA

By:

  /s/    Susan J. Dimmick

Name:

   

Title:

   

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE - CREDIT AGREEMENT]

 

LENDER: NEWCOURT CAPITAL USA, INC.

By:

  /s/    Gay A. Piazza

Name:

   

Title:

   

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE - CREDIT AGREEMENT]

 

LENDER: NM ROTHSCHILD & SONS LIMITED

By:

  /s/    Nicholas Wood

Name:

   

Title:

   

By:

  /s/    David Street

Name:

   

Title:

   

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE - CREDIT AGREEMENT]

 

LENDER: PNC BANK, NATIONAL ASSOCIATION, individually, as Co-Administrative Agent
and as Paying Agent

By:

  /s/    Christopher N. Moravec

Name:

  Christopher N. Moravec

Title:

  Senior Vice President

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE - CREDIT AGREEMENT]

 

LENDER: SOCIÉTÉ GÉNÉRALE, NEW YORK BRANCH, individually and as Co-Documentation
Agent

By:

  /s/    Donald B. Kyle

Name:

   

Title:

   

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE - CREDIT AGREEMENT]

 

LENDER:

SUNTRUST BANK, individually and as

Co-Documentation Agent

By:

  /s/    Kenneth M. Uchiyama

Name:

   

Title:

   

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE - CREDIT AGREEMENT]

 

LENDER: THE BANK OF NOVA SCOTIA - NEW YORK AGENCY

By:

  /s/    Denis P. O’Meara

Name:

   

Title:

   

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE - CREDIT AGREEMENT]

 

LENDER: UFJ BANK LIMITED, NEW YORK BRANCH

By:

  /s/    Harris Frommer

Name:

   

Title:

   

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE - CREDIT AGREEMENT]

 

LENDER: UNION BANK OF CALIFORNIA, N.A.

By:

  /s/    Alex Wemberg

Name:

   

Title:

   

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE - CREDIT AGREEMENT]

 

LENDER: U.S. BANK NATIONAL ASSOCIATION

By:

  /s/    Roger Gross

Name:

   

Title:

   

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE - CREDIT AGREEMENT]

 

LENDER: WELLS FARGO BANK N.A. By:   /s/    Art Krasny Name:     Title:    

 

--------------------------------------------------------------------------------

SCHEDULE 1.1(A)

 

PRICING GRID

 

Rating
Level

--------------------------------------------------------------------------------

  

Debt Rating [Standard & Poor’s and Moody’s Respectively]

--------------------------------------------------------------------------------

  

Revolving Credit

Euro-Rate
Spread

--------------------------------------------------------------------------------

   

Revolving Credit

Base Rate
Spread

--------------------------------------------------------------------------------

    Tranche B
Letter of Credit
Spread

--------------------------------------------------------------------------------

    Revolving
Letter of
Credit Fee

--------------------------------------------------------------------------------

 

I

   greater than BB+ or greater than Ba1    2.00 %   0.50 %   2.25 %   2.00 %

II

   BB+ or Ba1    2.50 %   1.00 %   2.25 %   2.50 %

III

   BB or Ba2    2.75 %   1.25 %   2.50 %   2.75 %

IV

   BB- or Ba3    3.00 %   1.50 %   2.50 %   3.00 %

V

   Less than BB- or unrated or Less than Ba3 or unrated    3.25 %   1.75 %  
2.50 %   3.25 %

 

For purposes of determining the Applicable Margin, the Applicable Revolving
Letter of Credit Fee Rate and the Applicable Tranche B Letter of Credit Fee
Rate:

 

(a) On the Closing Date, the Applicable Margin, Applicable Revolving Letter of
Credit Fee Rate and Applicable Tranche B Letter of Credit Fee Rate shall be such
rates determined in accordance with paragraph (b) below, provided that, for the
period ending six months from the Closing Date, no less than the respective
amounts set forth under Rating Level IV of this Schedule 1.1(A) set forth above.

 

(b) It is expressly agreed that after the Closing Date, the Applicable Margin,
Applicable Revolving Letter of Credit Fee Rate and Applicable Tranche B Letter
of Credit Fee Rate shall be determined based upon Schedule 1.1(A) above. In the
event that there is a difference in the Debt Ratings assigned by Moody’s and
Standard and Poor’s, then the Rating Level shall be determined by the higher
quality of the Debt Ratings unless the Debt Ratings assigned by Moody’s and
Standard and Poor’s, respectively differ by two or more levels, in which case
the Rating Level one below the higher of such Debt Ratings will apply. Any
change in the Applicable Margin, Applicable Revolving Letter of Credit Fee Rate
or the Applicable Tranche B Letter of Credit Fee Rate shall become effective
five (5) Business Days after any change in the Debt Rating requiring such an
increase or decrease.

 

--------------------------------------------------------------------------------

EXHIBIT 1.1(A)

 

ASSIGNMENT AND ASSUMPTION AGREEMENT

 

THIS ASSIGNMENT AND ASSUMPTION AGREEMENT (the “Assignment and Assumption”) is
dated as of the Effective Date set forth below and is entered into by and
between                                         
                                                              (the “Assignor”)
and                                         
                                                      (the “Assignee”).
Capitalized terms used but not defined herein shall have the meanings given to
them in the Credit Agreement identified below (as amended, the “Credit
Agreement”), receipt of a copy of which is hereby acknowledged by the Assignee.
The Standard Terms and Conditions set forth in Annex 1 attached hereto are
hereby agreed to and incorporated herein by reference and made a part of this
Assignment and Assumption as if set forth herein in full.

 

For an agreed consideration, the Assignor hereby irrevocably sells and assigns
to the Assignee, and the Assignee hereby irrevocably purchases and assumes from
the Assignor, subject to and in accordance with the Standard Terms and
Conditions and the Credit Agreement, as of the Effective Date inserted by the
Paying Agent as contemplated below (i) all of the Assignor’s rights and
obligations in its capacity as a Lender under the Credit Agreement and any other
documents or instruments delivered pursuant thereto to the extent related to the
amount and percentage interest identified below of all of such outstanding
rights and obligations of the Assignor under the respective facilities
identified below (including without limitation any Revolving Credit Commitments,
Tranche B Credit-Linked Deposit, letters of credit, guarantees, and swingline
loans included in such facilities) and (ii) to the extent permitted to be
assigned under applicable law, all claims, suits, causes of action and any other
right of the Assignor (in its capacity as a Lender) against any Person, whether
known or unknown, arising under or in connection with the Credit Agreement, any
other documents or instruments delivered pursuant thereto or the loan
transactions governed thereby or in any way based on or related to any of the
foregoing, including, but not limited to, contract claims, tort claims,
malpractice claims, statutory claims and all other claims at law or in equity
related to the rights and obligations sold and assigned pursuant to clause (i)
above (the rights and obligations sold and assigned pursuant to clauses (i) and
(ii) above being referred to herein collectively as, the “Assigned Interest”).
Such sale and assignment is without recourse to the Assignor and, except as
expressly provided in this Assignment and Assumption, without representation or
warranty by the Assignor.

 

  1. Assignor:                                         

 

  2. Assignee:                                         

[and is an Affiliate/Approved Fund of [identify Lender]1]

 

  3. Borrower: CONSOL Energy Inc.

--------------------------------------------------------------------------------

1 Select as applicable.

 

--------------------------------------------------------------------------------

  4. Paying Agent: PNC Bank, National Association, as the paying agent under the
Credit Agreement

 

  5. Credit Agreement: Credit Agreement dated as of June     , 2004 among CONSOL
Energy Inc., the Guarantors party thereto, the Lenders parties thereto, LaSalle
Bank National Association, Société Générale, New York Branch and SunTrust Bank,
each in its capacity as a co-documentation agent, and Citicorp North America,
Inc. and PNC Bank, National Association, in their capacities as
co-administrative agents for the Lenders

 

  6. Assigned Interest:

 

Facility Assigned

--------------------------------------------------------------------------------

   Aggregate
Amount of
Commitments /
Loans /Deposits
for all Lenders*

--------------------------------------------------------------------------------

   Amount of
Commitment /
Loans /
Deposit
Assigned*

--------------------------------------------------------------------------------

   Percentage
Assigned of
Commitment /
Loans /
Deposit 2

--------------------------------------------------------------------------------

   CUSIP
Number

--------------------------------------------------------------------------------

Revolving Credit Commitment

   $      $      %     

Tranche B Credit - Linked Deposit

   $      $      %           $      $      %     

 

  7. [Trade Date:                     ]3

 

Effective Date:             , 20     [TO BE INSERTED BY PAYING AGENT AND WHICH
SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER
THEREFOR.]

 

[SIGNATURE PAGE FOLLOWS]

--------------------------------------------------------------------------------

* Amount to be adjusted by the counterparties to take into account any payments
or prepayments made between the Trade Date and the Effective Date.

 

2 Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans of
all Lenders thereunder.

 

3 To be completed if the Assignor and the Assignee intend that the minimum
assignment amount is to be determined as of the Trade Date.

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE - ASSIGNMENT AND ASSUMPTION AGREEMENT]

 

The terms set forth in this Assignment and Assumption are hereby agreed to:

 

ASSIGNOR

[NAME OF ASSIGNOR]

By:    

Name:

   

Title:

   

 

ASSIGNEES

[NAME OF ASSIGNEE]

By:    

Name:

   

Title:

   

 

Consented to and Accepted:

PNC BANK, NATIONAL ASSOCIATION, as

Paying Agent

By:    

Name:

   

Title:

   

 

[Consented to:]4

CONSOL ENERGY INC.

By:    

Name:

   

Title:

   

--------------------------------------------------------------------------------

4 To be added only if the consent of the Borrower is required by the terms of
the Credit Agreement.

 

--------------------------------------------------------------------------------

ANNEX 1

 

STANDARD TERMS AND CONDITIONS

FOR ASSIGNMENT AND ASSUMPTION

 

1. Representations and Warranties.

 

1.1 Assignor. The Assignor (a) represents and warrants that (i) it is the legal
and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is
free and clear of any lien, encumbrance or other adverse claim and (iii) it has
full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby; and (b) assumes no responsibility with respect to (i) any
statements, warranties or representations made in or in connection with the
Credit Agreement or any other Loan Document (ii) the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Loan
Documents or any collateral thereunder, (iii) the financial condition of the
Borrower, any of its Subsidiaries or Affiliates or any other Person obligated in
respect of any Loan Document or (iv) the performance or observance by the
Borrower, any of its Subsidiaries or Affiliates or any other Person of any of
their respective obligations under any Loan Document.

 

1.2. Assignee. The Assignee (a) represents and warrants that (i) it has full
power and authority, and has taken all action necessary, to execute and deliver
this Assignment and Assumption and to consummate the transactions contemplated
hereby and to become a Lender under the Credit Agreement, (ii) it meets all
requirements of an Eligible Assignee under the Credit Agreement (subject to
receipt of such consents as may be required under the Credit Agreement), (iii)
from and after the Effective Date, it shall be bound by the provisions of the
Credit Agreement as a Lender thereunder and, to the extent of the Assigned
Interest, shall have the obligations of a Lender thereunder, (iv) it has
received a copy of the Credit Agreement, together with copies of the most recent
financial statements delivered pursuant to Section 8.3 thereof, as applicable,
and such other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into this Assignment and
Assumption and to purchase the Assigned Interest on the basis of which it has
made such analysis and decision independently and without reliance on the Paying
Agent or any other Lender, and (v) if it is a Lender that is not incorporated
under the Laws of the United States or a state thereof, attached to the
Assignment and Assumption is any documentation required to be delivered by it
pursuant to the terms of the Credit Agreement, duly completed and executed by
the Assignee; and (b) agrees that (i) it will, independently and without
reliance on the Paying Agent, the Assignor or any other Lender, and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
the Loan Documents, and (ii) it will perform in accordance with their terms all
of the obligations which by the terms of the Loan Documents are required to be
performed by it as a Lender.

 

2. Payments. From and after the Effective Date, the Paying Agent shall make all
payments in respect of the Assigned Interest (including payments of principal,
return of deposits, interest, fees and other amounts) to the Assignor for
amounts which have accrued to but

 

--------------------------------------------------------------------------------

excluding the Effective Date and to the Assignee for amounts which have accrued
from and after the Effective Date.

 

3. General Provisions. This Assignment and Assumption shall be binding upon, and
inure to the benefit of, the parties hereto and their respective successors and
assigns. This Assignment and Assumption may be executed in any number of
counterparts, which together shall constitute one instrument. Delivery of an
executed counterpart of a signature page of this Assignment and Assumption by
telecopy or by electronic signature delivery system (in either case in a form
acceptable to the Paying Agent) shall be effective as delivery of a manually
executed counterpart of this Assignment and Assumption. This Assignment and
Assumption shall be governed by, and construed in accordance with, the law of
the Commonwealth of Pennsylvania.

 

--------------------------------------------------------------------------------

EXHIBIT 1.1(C)

 

COLLATERAL TRUST AGREEMENT

 

--------------------------------------------------------------------------------

 

COLLATERAL

 

TRUST AGREEMENT

 

by and among

 

CONSOL ENERGY INC.

 

And

 

Its Designated Subsidiaries

 

and

 

WILMINGTON TRUST COMPANY,

as Corporate Trustee

 

and

 

DAVID A. VANASKEY,

as Individual Trustee

 

Dated as of June 30, 2004

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

COLLATERAL TRUST AGREEMENT

 

COLLATERAL TRUST AGREEMENT (“Agreement”) dated as of June 30, 2004, by and among
CONSOL Energy, Inc., a Delaware corporation (the “Borrower”), the subsidiaries
of the Borrower which have joined this Agreement (the “Designated Subsidiaries”,
collectively with the Borrower, the “Loan Parties”), Wilmington Trust Company, a
Delaware banking corporation, not in its individual capacity but solely as
corporate trustee (together with any successor corporate trustee appointed
pursuant to Section 5, the “Corporate Trustee”), and David A. Vanaskey, an
individual residing in the State of Maryland, not in his individual capacity but
solely as individual trustee (together with any successor individual trustee
appointed pursuant to Section 5, the “Individual Trustee”; the Corporate Trustee
and the Individual Trustee are each a “Collateral Trustee” and together the
“Collateral Trustees”), as trustees for the Secured Parties.

 

WITNESSETH:

 

WHEREAS, the Loan Parties and the Credit Facility Lenders are entering into the
Credit Facility Agreement;

 

WHEREAS, to induce the Credit Facility Lenders to enter into the Credit Facility
Agreement, the Loan Parties have agreed to secure, subject to the terms and
conditions of this Agreement and the Security Documents, the payment of the
Secured Debt;

 

WHEREAS, the effectiveness of the Credit Facility Agreement is conditioned upon
this Agreement and the related Security Documents having been duly executed and
delivered; and

 

WHEREAS, the terms of the Public Indenture and the Paying Agency Agreement
require, in the circumstances specified therein, that any indebtedness issued
thereunder be equally and ratably secured; and

 

WHEREAS, there currently is outstanding under the Public Indenture an aggregate
$250 million principal amount of 7.875% notes due 2012, and under the Paying
Agency Agreement, an aggregate $45 million principal amount of 8.25% notes due
2007.

 

DECLARATION OF TRUST

 

Contemporaneously herewith, to secure the payment, observance and performance of
the Secured Debt, the Borrower and the other Loan Parties are granting the
Collateral Trust Estate to the Collateral Trustees in accordance with the terms
of the Security Documents for the equal and ratable benefit of the Secured
Parties. The Collateral Trustees hereby declare that they, or their permitted
designees, in accordance with the terms hereof, hold and shall hold the
Collateral Trust Estate in trust for the use and benefit of the Secured Parties
subject to the terms and conditions of this Agreement.

 

--------------------------------------------------------------------------------

SECTION 1

 

DEFINITION

 

Section 1.1 Definitions and Other Matters.

 

(a) As used in this Agreement, including the introductory provisions hereof, the
following terms shall have the following meanings (such meanings to be equally
applicable to both the singular and plural forms of the terms defined):

 

“Actionable Default” means (i) an Event of Default under and as defined by the
Credit Facility Agreement; (ii) an event of default under the Public Indenture
or (iii) an event of default under the Paying Agency Agreement.

 

“Affiliate” means “Affiliate” as defined in the Credit Facility Agreement.

 

“Agents” means the collective reference to the Credit Facility Agent, the Public
Trustee and the Paying Agent.

 

“Bankruptcy Code” means the federal Bankruptcy Code, as amended from time to
time.

 

“Business Day” shall have the meaning ascribed to it in the Credit Facility
Agreement.

 

“Collateral” shall have the meaning ascribed to it in the Credit Facility
Agreement.

 

“Collateral Account” shall have the meaning ascribed to in Section 3.1(a)
hereof.

 

“Collateral Account Investments” shall mean (i) direct obligations of the United
States of America or any agency or instrumentality thereof or obligations backed
by the full faith and credit of the United States of America or (ii) investments
in shares of institutional mutual funds whose investment policies are limited to
such securities, which funds may (but shall not be required to) be funds owned
and/or managed by the Wilmington Funds or an Affiliate thereof (“Related
Funds”).

 

“Collateral Trustees” shall have the meaning ascribed to it in the introductory
paragraph hereto.

 

“Collateral Trust Estate” means the right, title, and interest of the Collateral
Trustees in the Collateral and all rights of the Collateral Trustees under each
of the Security Documents.

 

“Credit Facility Agent” means the Paying Agent as defined in the Credit Facility
Agreement, and any successor thereto.

 

2

--------------------------------------------------------------------------------

“Credit Facility Agreement” means the Credit Agreement, dated as of June 30,
2004, by and among Borrower, each of the Guarantors (as defined therein),
Citicorp North America, Inc. and PNC Bank, National Association, as
co-administrative agents, and the banks, financial institutions, other
institutional lenders and issuers of letters of credit listed on the signature
pages thereto, as amended, modified, supplemented, extended or restated or
refinanced from time to time.

 

“Credit Facility Debt” means, as of any date, the amount of Obligations (as that
term is defined in the Credit Facility Agreement) outstanding on such date.

 

“Credit Facility Documents” means, as of any date, the Loan Documents and the
Specified Swap Agreements (as such terms are defined in the Credit Facility
Agreement).

 

“Credit Facility Lender” means, as of any date, a holder of Credit Facility Debt
on such date.

 

“Debt Instruments” means the Credit Facility Documents, the Public Indenture,
the Paying Agency Agreement and the notes, guarantees or other instruments or
securities issued pursuant thereto.

 

“Governmental Authority” shall mean any nation or government, any state or other
political subdivision thereof and any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government.

 

“Holder” means, as of any date, any holder of Secured Debt on such date.

 

“Lien” means any mortgage, deed of trust, pledge, hypothecation, assignment,
deposit arrangement, security interest, encumbrance, lien (statutory or
otherwise), preference, priority or charge of any kind (including any agreement
to give any of the foregoing, any conditional sale or other title retention
agreement, any financing or similar statement or notice perfecting a security
interest under the Uniform Commercial Code as adopted and in effect in the
relevant jurisdiction, or other similar recording or notice statute, and any
lease in the nature thereof), but shall not include any operating lease.

 

“Moody’s” means Moody’s Investor Service Inc.

 

“Notice of Actionable Default” means a written certification (i) from the Credit
Facility Agent certifying that Credit Facility Debt under the Credit Facility
Agreement has not been paid in full at the stated maturity thereof or has been
declared to be due and payable prior to the stated maturity thereof in
accordance with the terms thereof, (ii) from the Public Trustee certifying that
Public Debt under the Public Indenture has not been paid in full at the stated
maturity thereof or has been declared to be due and payable prior to the stated
maturity thereof or (iii) from the Paying Agent or any Paying Agency Lender
certifying that Paying Agency Agreement Debt under the Paying Agency Agreement
has not been paid in full at the stated maturity thereof or has been declared to
be due and payable prior to the stated maturity thereof.

 

3

--------------------------------------------------------------------------------

“Paying Agency Agreement” means the Issuing and Paying Agency Agreement, dated
as of December 31, 1991, among the Borrower, Consolidation Coal Company, CONSOL
Inc. and The Bank of Nova Scotia Trust Company of New York (as successor paying
agent to JP Morgan Chase Bank), as further amended, modified, supplemented,
extended or restated.

 

“Paying Agency Agreement Debt” means, as of any date, indebtedness of the
Borrower outstanding on such date under the Paying Agency Agreement.

 

“Paying Agency Agreement Lender” means, as of any date, a holder of Paying
Agency Debt on such date.

 

“Paying Agent” means, as of any date, the Paying Agent under the Paying Agency
Agreement, and any successor thereto.

 

“Permitted Investments” shall have the meaning ascribed to it in the Credit
Facility Agreement.

 

“Person” means any individual, partnership, limited liability company, joint
venture, firm, corporation, association, trust or other enterprise (whether or
not incorporated) or any governmental or political subdivision or any agency,
department or instrumentality thereof.

 

“Public Debt” means, as of any date, the amount of indebtedness outstanding on
such date under the Public Indenture.

 

“Public Indenture” means the Indenture, dated March 7, 2002, as amended by the
First Supplemental Indenture, dated March 7, 2002, and as amended by the Second
Supplemental Indenture, dated September 30, 2003, by and among the Borrower,
certain subsidiaries of the Borrower and the Public Trustee, as trustee,
providing for the issuance of $250 million 7.875% senior unsecured notes due
March 1, 2012, as further amended, modified, supplemented, extended or restated
from time to time.

 

“Public Lenders” means, as of any date, the holders of indebtedness outstanding
on such date under the Public Indenture.

 

“Public Trustee” means, as of any date, the trustee under the Public Indenture,
and any successor thereto.

 

“Release Notice” means a written notice, signed by a Responsible Officer, that
requests the release of Liens in favor of the Collateral Trustees in certain
Collateral, describes in reasonable detail such Collateral and that certifies to
the Collateral Trustees that the release of such Collateral (a) is permitted
under the applicable terms of the Credit Facility Agreement and (b) has been
consented to by the Credit Facility Agent, the Super-Majority Lenders or all
Credit Facility Lenders, as required by the Credit Facility Agreement.

 

4

--------------------------------------------------------------------------------

“Responsible Officer” means the chief executive officer, the president, the
chief financial officer or the treasurer of the Borrower.

 

“S & P” means Standard & Poor’s Corporation.

 

“Secured Debt” means, as of any date, (i) the Credit Facility Debt, the Public
Debt and the Paying Agency Agreement Debt and (ii), without duplication, all
fees, expenses and charges (including, without limitation, indemnification,
reimbursement or contribution obligations) due or owing to any Secured Party
arising under any Debt Instrument, this Agreement or any Security Document.

 

“Secured Party” means any Credit Facility Lender, the Collateral Trustees, any
Public Lender, the Public Trustee, the Paying Agent, any Paying Agency Agreement
Lender, the Credit Facility Agent and the Co-Administrative Agents.

 

“Security Documents” means this Agreement, the documents set forth on Schedule
1.1 hereto, any additional documents executed on or after the date hereof to
reflect the grant to the Collateral Trustees of a lien upon or security interest
in any Collateral and any agreement or document referred to in Section 4.7 or
Section 7.1 (b) of this Agreement, as the same may be amended, supplemented,
extended, restated, replaced or otherwise modified in accordance with their
respective terms.

 

“Super-Majority Lenders” shall have the meaning ascribed to it in the Credit
Facility Agreement.

 

“Trustees’ Fees” means all fees, costs and expenses of the Collateral Trustees
of the types described in Sections 4.3, 4.4, 4.5 and 4.6 of this Agreement.

 

(b) The words “hereof’, “herein” and “hereunder” and words of similar import
when used in this Agreement shall refer to this Agreement as a whole and not to
any particular provision of this Agreement and section references are to this
Agreement unless otherwise specified.

 

(c) Subject to Section 3.2 of this Agreement in each case herein where any
payment or distribution is to be made or notice is to be given to “Holders,”
such payments, distributions and notices (i) in respect of the Public Debt,
shall be made to the Public Trustee for the benefit of the Public Lenders, (ii)
in respect of the Credit Facility Debt, shall be made to the Credit Facility
Agent for the benefit of the Credit Facility Lenders and (iii) in respect of the
Paying Agency Agreement Debt, shall be made to the Paying Agent for the benefit
of the Paying Agency Agreement Lenders.

 

(d) All terms defined in this Agreement in the singular shall have comparable
meanings when used in the plural, and vice versa, unless otherwise specified.

 

(e) Terms not otherwise defined herein which are defined in or used in Article 9
of the Uniform Commercial Code as in effect in the Commonwealth of Pennsylvania
shall herein have the respective meanings given to them in Article 9.

 

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SECTION 2

 

ACTIONABLE DEFAULTS; REMEDIES

 

Section 2.1 Actionable Default.

 

(a) Upon receipt of a Notice of Actionable Default, the Collateral Trustees
shall, within five (5) Business Days thereafter, notify each Agent that it has
received a Notice of Actionable Default. Upon receipt of any written directions
pursuant to Section 2.2, 2.6(a) or 2.6(b) the Collateral Trustees shall, within
five (5) Business Days thereafter, send a copy thereof to each Agent.

 

(b) Each Agent or any Paying Agency Lender that delivered a Notice of Actionable
Default (or successors in interest thereto) shall be entitled (but not
obligated) to withdraw a Notice of Actionable Default sent by such Agent or
Paying Agency Lender by delivering written notice of withdrawal to the
Collateral Trustees. The Collateral Trustees shall promptly notify the Borrower
as to the receipt of, and provide a copy of, any such notice of withdrawal and
shall promptly notify each other Agent of the withdrawal of any Notice of
Actionable Default.

 

Section 2.2 Remedies.

 

(a) After receipt of any Notice of Actionable Default with respect to which the
Collateral Trustees shall not have received a notice of withdrawal in accordance
with Section 2.1(b), the Collateral Trustees shall, following receipt of the
written direction of the Credit Facility Agent, initiate the exercise of
remedies with respect to the Collateral and exercise the rights and remedies
provided in any of the Security Documents, in each case, as directed in writing
by the Credit Facility Agent pursuant to Section 2.6. Other than as provided in
the preceding sentence, no Secured Party (including, without limitation, the
Collateral Trustees), shall have the right to direct the Collateral Trustees
with respect to the exercise of rights and remedies under the Security Documents
or otherwise with respect to the Collateral. Each Collateral Trustee shall be
entitled to assume conclusively that no Actionable Default has occurred and is
continuing until and unless it receives a Notice of Actionable Default. Each
Collateral Trustee shall be entitled to assume conclusively that a Notice of
Actionable Default has not been withdrawn unless and until it receives a notice
of withdrawal in accordance with Section 2.1(b).

 

(b) As to any matters not expressly provided for under this Agreement or the
other Security Documents (including, without limitation, matters relating to
enforcement and collection of the Secured Debt), the Collateral Trustees shall
not be required to exercise any discretion or to take any action under this
Agreement or the other Security Documents, or under applicable law, including
title 11 of the United States Code, or in respect of the Collateral, but shall
be required to act or to refrain from acting (and shall be fully protected in
acting or refraining from acting) in accordance with the written instructions of
the Credit Facility Agent which instructions shall reference Section 4.6 hereof.

 

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Section 2.3 Right to Initiate Judicial Proceedings, Etc. If and only if the
Collateral Trustees shall have received a Notice of Actionable Default and
during such time as the Collateral Trustees shall not have received a notice of
withdrawal of such Notice of Actionable Default in accordance with the
provisions of Section 2.1(b) hereof, at the direction in writing of the Credit
Facility Agent as provided in Section 2.2, the Corporate Trustee, and if the
Corporate Trustee deems necessary or desirable, the Individual Trustee, jointly
or individually as the Corporate Trustee may determine in its sole discretion,
(i) shall have the right and power to institute and maintain such suits and
proceedings as the Credit Facility Agent may deem appropriate to protect and
enforce the rights vested in the Collateral Trustees by this Agreement and each
Security Document, and (ii) may, either after entry or without entry, proceed by
suit or suits at law or in equity to enforce such rights and to foreclose upon
the Collateral and to sell all or, from time to time, any of the Collateral
Trust Estate under the judgment or decree of a court of competent jurisdiction.

 

Section 2.4 Appointment of a Receiver. If a receiver of the Collateral Trust
Estate shall be appointed in judicial proceedings, the Collateral Trustees may
be appointed, in their discretion, as such receiver. Notwithstanding the
appointment of a receiver, the Collateral Trustees shall be entitled to retain
possession and control of all cash held by or deposited with them or their
agents or co-trustees pursuant to any provision of this Agreement or any
Security Document.

 

Section 2.5 Exercise of Powers. All of the powers, remedies and rights of the
Collateral Trustees as set forth in this Agreement may be exercised by the
Collateral Trustees in respect of any Security Document as though set forth at
length therein and all the powers, remedies and rights of the Collateral
Trustees as set forth in any Security Document may be exercised from time to
time as herein and therein provided.

 

Section 2.6 Direction from Credit Facility Agent.

 

(a) Subject to Section 2.6(b) of this Agreement, if the Collateral Trustees
shall have received a Notice of Actionable Default and during such time as the
Collateral Trustees shall not have received a notice of withdrawal of such
Notice of Actionable Default in accordance with the provisions of Section 2.1(b)
hereof, (i) the Credit Facility Agent shall have the right, by an instrument in
writing executed and delivered to the Collateral Trustees, to direct the
Collateral Trustees to initiate the exercise of remedies with respect to the
Collateral and (ii) the Credit Facility Agent shall have the right, by an
instrument in writing executed and delivered to the Collateral Trustees, to
direct the Collateral Trustees to refrain from exercising any right, remedy,
trust or power available to or conferred upon the Collateral Trustees hereunder.
Notwithstanding any other provision contained in this Agreement or any of the
Security Documents to the contrary, the Collateral Trustees shall not take any
action or exercise any right with respect to the exercise of remedies, the
preservation of the Collateral or otherwise (except for the giving of notices
hereunder, the application of moneys pursuant to Section 3 and the release of
Collateral pursuant to Section 6) without written instructions from the Credit
Facility Agent.

 

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(b) Except as otherwise provided in Section 5.5(d) and subject to Section 5.5(b)
and 5.5(c), the Collateral Trustees shall be obligated to follow any written
directions received pursuant to Sections 2.1, 2.2 or 2.6(a) or otherwise under
this Agreement.

 

Section 2.7 Remedies Not Exclusive.

 

(a) No remedy conferred upon or reserved to the Collateral Trustees herein or in
any of the Security Documents is intended to be exclusive of any other remedy or
remedies, but every such remedy shall be cumulative and shall be in addition to
every other remedy conferred herein or in any of the Security Documents or now
or hereafter existing at law or in equity or by statute.

 

(b) No delay or omission of or by the Collateral Trustees to exercise any right,
remedy or power accruing upon receipt of any Notice of Actionable Default shall
impair any such right, remedy or power or shall be construed to be a waiver
thereof or an acquiescence therein; and, subject in all respects to Section
2.1(b), 2.2, 2.3 and 2.6, every right, power and remedy given by this Agreement
or any Security Document to the Collateral Trustees may be exercised from time
to time and as often as may be deemed expedient by the Collateral Trustees.

 

(c) In case the Collateral Trustees shall have proceeded to enforce any right,
remedy or power under this Agreement or any Security Document and the proceeding
for the enforcement thereof shall have been discontinued or abandoned for any
reason or shall have been determined adversely to the Collateral Trustees, then
and in every such case the Borrower, the other Loan Parties, the Collateral
Trustees and the Secured Parties shall, subject to any effect of or
determination in such proceeding, severally and respectively be restored to
their former positions and rights hereunder and under such Security Document
with respect to the Collateral Trust Estate and in all other respects, and
thereafter all rights, remedies and powers of the Collateral Trustees shall
continue as though no such proceeding had been taken.

 

(d) All rights of action and rights to assert claims upon or under this
Agreement and the Security Documents may be enforced by the Collateral Trustees
without the possession of any Debt Instrument or the production thereof in any
trial or other proceeding relative thereto, and any such suit or proceeding
instituted by the Collateral Trustees may be brought in either of their names as
Collateral Trustee and any recovery of judgment shall be held as part of the
Collateral Trust Estate.

 

Section 2.8 Loan Parties’ and Collateral Trustees’ Rights as to Collateral;
Limitation on Collateral Trustees’ Duties in Respect of Collateral.

 

(a) So long as no Notice of Actionable Default shall have been received by the
Collateral Trustees (or if received, shall have been withdrawn in accordance
with the provisions hereof), the Borrower and the other Loan Parties shall be
entitled to exercise all rights, powers, privileges and remedies in respect of
the Collateral, in each case free and clear of any liens or encumbrance arising
out of this Agreement, notwithstanding the grant of security provided for in the
Security Documents, subject, however, to the provisions of Section 3.1 and

 

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6.1 hereof, to the provisions in the other Security Documents and to the
provisions of the Credit Facility Agreement.

 

(b) Each Loan Party, on behalf of itself and all who may claim through or under
it, including, without limitation, any and all subsequent affiliates, creditors,
vendees, assignees and lienors, expressly waives and releases, to the fullest
extent permitted by law, any, every and all rights to demand or to have any
marshalling of the Collateral Trust Estate upon any enforcement of any Security
Document, including, without limitation, upon any sale, whether made under any
power of sale herein granted or pursuant to judicial proceedings or upon any
foreclosure or any enforcement of any Security Document and consents and agrees
that all the Collateral Trust Estate and any such sale may be offered and sold
as an entirety or in parcels.

 

(c) Beyond its duties set forth in this Agreement as to the custody of the
Collateral and the payment to the Borrower, the other Loan Parties and the
Secured Parties for moneys received by it hereunder, the Collateral Trustees
shall not have any duty to the Borrower, the other Loan Parties or the Secured
Parties as to any Collateral in its possession or control or in the possession
or control of any agent or nominee of it or any income thereon or as to the
preservation of rights against prior parties or any other rights pertaining
thereto. To the extent, however, that the Collateral Trustees or an agent or
nominee of the Collateral Trustees maintains possession or control of any of the
Collateral, the Collateral Trustees shall, or shall instruct such agent or
nominee to, grant the Borrower or the other Loan Parties the access to such
Collateral, which the Borrower requires for the conduct of its business or to
enable the Borrower and the other Loan Parties to exercise all rights, powers,
privileges and remedies in respect of the Collateral so long as the Collateral
Trustees shall not have received a Notice of Actionable Default.

 

Section 2.9 Limitation by Law. All rights, remedies and powers provided by this
Section 2 may be exercised only to the extent that the exercise thereof does not
violate any applicable provision of law, regulation or court order and all the
provisions of this Section 2 are intended to be subject to all applicable
mandatory provisions of law, regulation or court order which may be controlling
and to be limited to the extent necessary so that they will not render this
Agreement invalid, unenforceable in whole or in part.

 

Section 2.10 Absolute Rights of Holders. Notwithstanding any other provision of
this Agreement or any provision of any Security Document, the right of each
Holder, which is absolute and unconditional, to receive payments of the Secured
Debt held by such Holder as therein expressed, to institute suit for the
enforcement of such payment, or to assert its position and views as a secured
creditor in, and to otherwise exercise any right (other than the right to
enforce the security interest in and lien on the Collateral, which shall in all
circumstances be exercisable only by the Collateral Trustees at the written
direction of the Credit Facility Agent) it may have in connection with, a case
under the Bankruptcy Code in which the Borrower or any Loan Party is a debtor,
or the obligation of the Borrower or any Loan Party, which is also absolute and
unconditional, to pay the Secured Debt owing by the Borrower or any Loan Party
to each Holder at the time and place expressed therein shall not be impaired or
affected without the consent of such Holder.

 

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Section 2.11 Equal and Ratable Security. This Agreement and the Security
Documents are intended to secure the Secured Debt equally and ratably to the
extent required by the Public Indenture or the Paying Agency Agreement. All of
the Secured Parties shall be bound by any instruction or delivery given by the
Credit Facility Agent pursuant to this Agreement.

 

SECTION 3

 

APPLICATION OF MONEYS

 

Section 3.1 Application of Proceeds.

 

(a) Subject to Section 3.2 hereof, if, pursuant to the exercise by the
Collateral Trustees, at the written direction of the Credit Facility Agent, of
any rights and remedies set forth in any Security Document, any Collateral is
sold or otherwise realized upon by the Collateral Trustees, the proceeds
received by the Collateral Trustees in respect of such Collateral shall be
deposited in a cash collateral account (the “Collateral Account”), maintained by
the Corporate Trustee at its offices at its corporate trust department in the
State of Delaware, which shall be non-interest bearing until such time as the
Collateral Trustees shall cause to be effected written directions received
pursuant to Section 3.4(a), at which time the investments acquired pursuant to
such directions shall accrue such interest and/or other income as provided by
the terms thereof. All moneys held by the Corporate Trustee in the Collateral
Account, shall, to the extent available for distribution, be distributed by the
Corporate Trustee on each date upon which a distribution is made (each, a
“Distribution Date”) as follows:

 

FIRST: to the payment (in such priority as the Corporate Trustee shall elect,
but without duplication) of all reasonable fees and expenses of legal counsel
and other professionals and other reasonable costs or expenses or other
liabilities of any kind incurred by the Collateral Trustees as secured parties
under any Security Document or otherwise in connection with any Security
Document or this Agreement (including, without limitation, any reasonable costs
or expenses or liabilities incurred in connection with the sale of any assets
covered by any Security Document, or in the operation or maintenance of any of
the assets covered by any Security Document), including the reimbursement to any
Secured Party of any amounts theretofore advanced by such Secured Party for the
payment of such fees, costs and expenses, except only for any such fees,
expenses, costs or liabilities incurred by either Collateral Trustee as a result
of its gross negligence or willful misconduct; provided, however, that nothing
herein is intended to relieve the Loan Parties of their duties to pay such
costs, fees, expenses and liabilities otherwise payable to the Collateral
Trustees from funds outside of the Collateral Account, as required by this
Agreement;

 

SECOND: to the Collateral Trustees (without duplication) in an amount equal to
the Trustees’ Fees which are unpaid as of the Distribution Date and to the
Agents for the benefit of any of their respective Secured Parties which has
theretofore advanced or paid any such Trustees’ Fees in an amount equal to the
amount thereof so advanced or paid by such Secured Party prior to such

 

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Distribution Date; provided, however, that nothing herein is intended to relieve
the Loan Parties of their duties to pay such fees and claims from funds outside
of the Collateral Account, as required by this Agreement;

 

THIRD: To each Agent in an amount equal to the costs and expenses of and any
other amounts due to the Secured Parties represented by such Agent and the
representatives of such Secured Parties not otherwise referred to in this
Section 3.1(a) which are payable by the Borrower to the Secured Parties under
the relevant Debt Instrument, and, in case such moneys shall be insufficient to
pay in full such costs and expenses and other amounts, then to the payment
thereof ratably (without priority of any one over any other) to each Agent;

 

FOURTH: To each Agent in an amount equal to the unpaid interest on the Secured
Debt held by the Secured Parties represented by such Agent, and, in case such
moneys shall be insufficient to pay in full such interest, then to the payment
thereof ratably (without priority of any one over any other) to each such Agent
in proportion to the unpaid amounts thereof; provided, that for purposes of this
clause FOURTH, unpaid interest shall not include interest accruing on amounts
held by the Corporate Trustee pursuant to Section 3.2;

 

FIFTH: To each Agent in an amount equal to the unpaid remainder of the Secured
Debt held by the Secured Parties represented by such Agent whether or not then
due and payable, and, in case such moneys shall be insufficient to pay in full
such Secured Debt, then to the payment thereof equally and ratably (without
priority of any one over any other) to each such Agent; provided that if at the
time of any such distribution, there are any undrawn Letters of Credit under the
Credit Facility Agreement, the amount attributable to the undrawn Letters of
Credit that otherwise would be distributed to the Credit Facility Agent pursuant
hereto shall be retained by the Collateral Trustees as cash collateral security
for the undrawn Letters of Credit and distributed in accordance with Section
3.1(d); and

 

SIXTH: Any surplus then remaining shall be paid to the Borrower or its
successors or assigns, or to whomever may be lawfully entitled to receive the
same, or as a court of competent jurisdiction may direct.

 

(b) The term “unpaid” as used in such clause SECOND, FOURTH and FIFTH of
subsection (a) shall mean all amounts of outstanding Trustees’ Fees and other
Secured Debt as to which prior payments or distributions (whether actually
distributed or set aside) have not been made, or if made, have subsequently been
recovered from the recipient thereof.

 

(c) In order to determine the ratable amount to be distributed to each of the
Secured Parties pursuant to clauses THIRD, FOURTH and FIFTH above on each
Distribution Date, the Corporate Trustee shall rely on a certificate of a
Responsible Officer of the Borrower, which shall be delivered to the Collateral
Trustees within five (5) Business Days after receipt by the Borrower from the
Collateral Trustee of a copy of the applicable distribution request delivered by
a Secured Party pursuant to Section 3.3 hereof, setting forth the Secured Debt

 

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(identified by type and amount) outstanding under each Debt Instrument on such
Distribution Date and such other matters set forth in Section 4.2(a) hereof. The
ratable portion of the aggregate amount available for distribution hereunder on
any Distribution Date which shall be distributed to each Agent for the benefit
of the Secured Parties represented by such Agent on such Distribution Date shall
be a fraction, (x) the numerator of which shall be the aggregate amount of
Secured Debt represented by such Agent for such Secured Party on such
Distribution Date and (y) the denominator of which shall be the aggregate amount
of all Secured Debt on such Distribution Date; provided, however, that, for such
purposes, amounts distributable to Holders of Paying Agency Agreement Debt on a
prior Distribution Date and held by the Corporate Trustee on behalf of such
Holders pursuant to Section 3.2 of this Agreement and amounts distributable to
any Agent on a prior Distribution Date and held by the Corporate Trustee on
behalf of such Agent pursuant to Section 3.3 or 4.2(a) of this Agreement shall
be deemed to have been applied to the Secured Debt of the Holders of the
applicable Secured Debt, regardless of whether such application has occurred.

 

(d) Any amounts retained by the Collateral Trustees pursuant to the FIFTH clause
with respect to undrawn Letters of Credits shall be distributed as follows:

 

(i) if a drawing is made on an outstanding Letter of Credit, upon written notice
to such effect from the Credit Facility Agent to the Collateral Trustees, the
Collateral Trustees shall distribute to the Credit Facility Agent from the cash
collateral being held as security for the undrawn Letters of Credit a ratable
portion of the amount of the Letter of Credit so drawn; and

 

(ii) if a Letter of Credit expires or is returned undrawn, upon written notice
to such effect from the Credit Facility Agent to the Collateral Trustees, the
cash collateral with respect to such expired or undrawn Letters of Credit held
by the Collateral Trustees shall be distributed to the Agents by the Collateral
Trustees so that all distributions made pursuant to the FIFTH clause through
such date shall have resulted in an equal and ratable distribution to the
Secured Parties pursuant to such clause.

 

Section 3.2 Application of Moneys Distributable to Holders of Paying Agency
Agreement Debt. If at any time any moneys collected or received by the
Collateral Trustees pursuant to this Agreement or any of the Security Documents
are distributable pursuant to Section 3.1 of this Agreement to the Paying Agency
Agreement Lenders, and if no provision is made under the Paying Agency Agreement
(i) for the application by the Paying Agent of such amounts so distributable
(whether by virtue of the Secured Debt issued under the Paying Agency Agreement
not having become due and payable or otherwise), or (ii) for the receipt and the
holding by the Paying Agent of such amounts pending the application thereof,
then the Corporate Trustee shall invest such amounts in Permitted Investments,
and shall hold all such amounts so distributable in the Collateral Account, and
all such investments and the proceeds thereof, in trust solely for the Paying
Agency Agreement Lenders (in its capacity as Corporate Trustee) and for no other
purpose until such time as the Paying Agent or any Paying Agency Agreement
Lender shall request the delivery thereof by the Collateral Trustees to the
Paying Agent for application by it pursuant to the Paying Agency Agreement or to
such Paying Agency Agreement Lender.

 

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Section 3.3 Release of Amounts in Collateral Account. Amounts distributable to
an Agent on any Distribution Date pursuant to Section 3.1 shall be paid to such
Agent for the benefit of the Secured Party(ies) represented by such Agent by the
Corporate Trustee (or deposited to an account for the benefit of the Paying
Agent and the Paying Agent Agreement Lenders pursuant to Section 3.2) upon
receipt by the Corporate Trustee of a distribution request of such Agent setting
forth appropriate payments instructions for such Agent and receipt by the
Corporate Trustee of a certificate of Borrower required by Sections 3.1(c) and
4.2(a) hereof. The Corporate Trustee shall promptly provide a copy of any such
distribution request received by the Corporate Trustee to the Borrower. If no
such distribution request is delivered by an Agent or no such certificate is
delivered by Borrower within 10 Business Days of deposit in the Collateral
Account of proceeds received by the Collateral Trustees in respect of any
Collateral, the Corporate Trustee shall continue to hold amounts otherwise
distributable to such Agent in a separate non-interest bearing account of the
Corporate Trustee for the benefit of such Agent and the applicable Secured
Party(ies) and the Corporate Trustee shall not be required to make any
distributions until such distribution request or certificate is received.

 

Section 3.4 Investments of Amounts in Collateral Account.

 

(a) Cash on deposit in the Collateral Account and any other account established
pursuant to Section 3.3 or 4.2(a) hereof shall be invested and reinvested in
Collateral Account Investments by the Corporate Trustee, who shall make such
Collateral Account Investments at the written direction of (i) the Borrower
prior to Notice of Actionable Default, (unless such notice is withdrawn) with
respect to amounts in the Collateral Account or (ii) the applicable Agent with
respect to amounts in any other account established pursuant to Section 3.3 or
4.2(a). The Collateral Trustees shall not have any liability to the Borrower,
any Agent or any Secured Party resulting from any losses on investments made by
it in Collateral Account Investments in accordance with this Section 3.4 or if
the earnings realized on any investment in Collateral Account Investments are
less than otherwise could have been achieved had other Collateral Account
Investments been selected. The Corporate Trustee shall sell or liquidate all or
any part of the Collateral Account Investments held in the Collateral Account or
other account established pursuant to Section 3.3 or 4.2(a) at any time it
determines, in its sole judgment, that the proceeds thereof are required to make
a distribution from the Collateral Account or such other account, and the
Collateral Trustees shall not be liable to any Person for any loss suffered
because of such sale or liquidation.

 

(b) All investments in Collateral Account Investments made by the Corporate
Trustee, and the net proceeds of the sale, liquidation or payment thereof, and
all interest on, or other earnings realized with respect to, any investment in
the Collateral Account or other account established pursuant to Section 3.3 or
4.2(a), shall be held in the Collateral Account or such other account and for
the same purposes as the cash used to purchase such Collateral Account
Investments.

 

(c) In the absence of written directions pursuant to Section 3.4(a) from the
Borrower as to the investment by the Corporate Trustee of cash on deposit in the
Collateral Account and any other account established pursuant to Section 3.3 or
4.2(a) hereof in Collateral Account Investments, and at all times after Notice
of Actionable Default (which has not been

 

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withdrawn), the Corporate Trustee shall invest all such cash on deposit in U.S.
Governmental securities or Service class shares of the U.S. Government Portfolio
(the “Portfolio”) of the Wilmington Funds, a mutual fund (the “Fund”) managed by
Rodney Square Management Corporation, a subsidiary of Corporate Trustee. The
Borrower acknowledges and agrees that (i) shares in the Portfolio and shares in
Related Funds are not (x) obligations of Wilmington Trust Company, (y) deposits
or (z) insured by the FDIC, (ii) the Wilmington Trust Company and/or one or more
of its Affiliates are compensated by the Fund and by the Related Funds for (1)
services rendered in its capacity as investment advisor, custodian and/or
transfer agent; and (2) providing shareholder services; and (iii) such
compensation is described in detail in the prospectus for the Fund and Related
Funds, and exclusive of and additional to the compensation and other amounts
payable to Wilmington Trust Company in its capacity as Corporate Trustee
hereunder.

 

SECTION 4

 

AGREEMENTS WITH TRUSTEES

 

Section 4.1 Delivery of Debt Instruments. On the date hereof, the Borrower will
deliver to the Collateral Trustees true and complete copies of the Credit
Facility Agreement, the Public Indenture, the Paying Agency Agreement and each
Security Document. The Borrower agrees that, promptly upon the execution
thereof, the Borrower will deliver to the Collateral Trustees a true and
complete copy of any and all amendments, modifications or supplements to the
Credit Facility Agreement, the Public Indenture, the Paying Agency Agreement and
each Security Document entered into by the Borrower subsequent to the date
hereof.

 

Section 4.2 Information as to Holders.

 

(a) The Borrower agrees that it shall deliver to the Collateral Trustees from
time to time within five (5) Business Days after a request by the Collateral
Trustees, a list setting forth (i) the aggregate amount of Obligations
outstanding under the Credit Facility Agreement and the aggregate principal
amount outstanding under each of the Public Indenture and the Paying Agency
Agreement, or any of them, (ii) the interest rates then in effect under the
Credit Facility Agreement, the Public Indenture and the Paying Agency Agreement,
to the extent known by Borrower and (iii) such other information in the
Borrower’s possession regarding the Secured Parties and the Debt Instruments as
the Collateral Trustees may reasonably request. The Borrower will furnish to the
Collateral Trustees on the date hereof a list setting forth the name and address
of the Credit Facility Agent, the Public Trustee and the Paying Agent, and the
Borrower agrees to furnish promptly to the Collateral Trustees any changes or
additions to such list. In addition, the Borrower shall deliver to the
Collateral Trustees, each time a distribution from the Collateral Trust Estate
or the Collateral Account is to be made pursuant to the terms hereof, not later
than five (5) Business Days after receipt by the Borrower from the Collateral
Trustee of a copy of the applicable distribution request delivered by a Secured
Party pursuant to Section 3.3 hereof, a certificate of a Responsible Officer of
the Borrower, setting forth the information required by Section 3.1(c) hereof in
connection with the determination of amounts to be distributed and the Persons
to whom such distributions are to be made, including appropriate

 

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payment instructions therefor (the “Payment Information”), provided that if any
distribution is directed to be made to any Agent, if such Agent shall have
notified the Collateral Trustees in writing that such Agent is unable to accept
such distribution, such distribution shall be made instead to an account
established for the benefit of such Agent and the Holders of the applicable
Secured Debt. The Collateral Trustees may, for all purposes hereunder, rely on
such information given by the Borrower.

 

(b) If the Borrower shall not have delivered the Payment Information to the
Collateral Trustees at least five (5) Business Days prior to the applicable
Distribution Date, the Collateral Trustees shall request the Payment Information
from the Credit Facility Agent, and if after such request the Collateral
Trustees shall not have received the Payment Information from any of the
Borrower, or the Credit Facility Agent, the Collateral Trustees shall not be
required to take any action under clauses THIRD, FOURTH, FIFTH or SIXTH of
Section 3.1(a) until it receives such Payment Information. The Collateral
Trustees may, for all purposes hereunder, rely on such information given by the
Credit Facility Agent.

 

Section 4.3 Compensation and Expenses. The Loan Parties agree, jointly and
severally, to pay to the Collateral Trustees and any co-trustees or successor
trustees appointed hereunder, from time to time upon demand, (a) such
compensation for their services hereunder and under the Security Documents and
for administering the Collateral Trust Estate, the Collateral Account and any
account or accounts established pursuant to this Agreement as set forth on the
fee schedule attached hereto as Schedule 4.3, as such Schedule 4.3 may be
amended, supplemented or otherwise modified by the written agreement of the Loan
Parties and the Collateral Trustees from time to time and (b) all the reasonable
fees, costs and expenses incurred by any of them (including, without limitation,
the reasonable fees and disbursements of legal counsel and other professionals)
(i) arising in connection with the preparation, negotiation, execution,
delivery, modification and termination of this Agreement and each of the
Security Documents or the administration, monitoring or enforcement of any of
the provisions hereof or thereof or (ii) incurred or advanced in connection with
the administration of the Collateral Trust Estate, the Collateral Account, any
account or accounts established pursuant to Section 3.3 or 4.2(a) hereof, the
sale or other disposition of Collateral pursuant to any Security Document and
the preservation, protection or defense of their rights under this Agreement and
in and to the Collateral, the Collateral Account, any account or accounts
established pursuant to Section 3.3 or 4.2(a) hereof and the Collateral Trust
Estate. As security for such payment, the Collateral Trustees shall have a prior
lien upon all Collateral (as effected pursuant to Article 3 herein) and other
property and funds held or collected by the Collateral Trustees as part of the
Collateral Trust Estate. Each Loan Parties’ obligations under this Section 4.3
shall survive the termination of this Agreement.

 

Section 4.4 Stamp and Other Similar Taxes. The Loan Parties agree, jointly and
severally, to indemnify and hold harmless the Collateral Trustees from any
present or future claim for liability for any stamp or other similar tax and any
penalties or interest with respect thereto, which may be assessed, levied or
collected by any jurisdiction in connection with this Agreement, any Security
Document, the Collateral Trust Estate, or any Collateral. The obligations of the
Borrower and the other Loan Parties under this Section 4.4 shall survive the
termination of the other provisions of this Agreement.

 

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Section 4.5 Filing Fees, Excise Taxes, Etc. The Loan Parties agree, jointly and
severally, to pay or to reimburse the Collateral Trustees for any and all
amounts in respect of all search, filing, recording and registration fees,
taxes, excise taxes and other similar imposts which may be payable in respect of
the execution, delivery, performance and enforcement of this Agreement and each
Security Document. The obligations of the Borrower and the other Loan Parties
under this Section 4.5 shall survive the termination of the other provisions of
this Agreement.

 

Section 4.6 Indemnification.

 

(a) Each Loan Party agrees, jointly and severally, to pay, indemnify, and hold
harmless the Collateral Trustees, their respective Affiliates, and each of the
officers, directors, employees, stockholders, agents, attorneys-in-fact and
representatives of either Collateral Trustee and such Affiliates, from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever (including, without limitation, the reasonable costs and
expenses of defending any claim against any of them) with respect to the
execution, delivery, enforcement, performance and administration of this
Agreement and the Security Documents unless and to the extent arising from the
gross negligence or willful misconduct of such of the Collateral Trustees, their
respective Affiliates, or each of the officers, directors, employees,
stockholders, agents, attorneys-in-fact or representatives of either Collateral
Trustee or such Affiliates as are seeking indemnification. As security for such
payment, any such Collateral Trustee shall have a prior lien upon all Collateral
(as effected pursuant to Article 3 herein) and other property and funds held or
collected by the Collateral Trustees as part of the Collateral Trust Estate.

 

(b) In any suit, proceeding or action brought by the Collateral Trustees under
or with respect to any Security Document or the Collateral for any amount owing
thereunder, or to enforce any provisions thereof, each Loan Party will, jointly
and severally, save, indemnify and hold harmless the Collateral Trustee from and
against all expense, loss or damage suffered by reason of any defense, set-off,
counterclaim, recoupment or reduction of liability whatsoever of the obligee
thereunder, arising out of a breach by any Loan Party of any obligation
thereunder or arising out of any other agreement, indebtedness or liability at
any time owing to or in favor of such obligee or its successors from such Loan
Party and all such obligations of any Loan Party shall be and remain enforceable
against and only against such Loan Party and shall not be enforceable against
the Collateral Trustees.

 

(c) The agreements in this Section 4.6 shall survive the termination of the
other provisions of this Agreement.

 

Section 4.7 Further Assurances.

 

(a) Each Loan Party agrees, from time to time, at its own expense to execute,
acknowledge, deliver, record, re-record, file, re-file, register and re-register
any and all such further acts, financing statements and continuations thereof,
notices of assignment, transfers, certificates, assurances and other instruments
as may be reasonably necessary or desirable, or as any Collateral Trustee may
reasonably request from time to time in order to carry out the

 

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purposes of the terms and conditions of the Security Documents. Without limiting
the generality of the foregoing, each Loan Party will take any such action
required to be taken by it pursuant to any Security Document.

 

(b) Each Loan Party hereby authorizes the Collateral Trustees to file one or
more financing or continuation statements relative to all or any part of the
Collateral, and amendments thereto to correct the name and address of such Loan
Party or the Collateral Trustees or to correct the description of the
“Collateral” contained in any of the Security Documents to be consistent with
the description of the Collateral contained in such Security Document, in each
case without the signature of such Loan Party where permitted by law and which
shall be filed by the Collateral Trustees upon the receipt of an instruction
letter from the Credit Facility Agent requesting the taking of such action and
attaching the form of financing statement. A photocopy or other reproduction of
this Agreement, any other Security Document or any financing statement covering
the Collateral or any part thereof shall be sufficient as a financing statement
where permitted by law.

 

(c) The Loan Parties will furnish such information about the Collateral as the
Collateral Trustees may reasonably request from time to time.

 

Section 4.8 Recording and Opinions.

 

(a) The Borrower shall furnish to the Collateral Trustees, upon the execution
and delivery of this Agreement, opinions of counsel to the Loan Parties required
by the Credit Facility Agreement, addressed to the Collateral Trustees, among
others. Promptly after the execution and delivery of any other instrument of
further assurance or amendment granting, perfecting, protecting or preserving a
Lien pursuant to any Security Document, opinions of counsel (which may include,
at the option of the Borrower, in-house counsel), in form and substance
substantially similar to the applicable opinions required by the Credit Facility
Agreement.

 

(b) The Borrower shall furnish to the Collateral Trustees on June 30 of each
year beginning with June 30, 2005 an opinion of counsel (which may be, at the
option of the Borrower, an opinion of in-house counsel), dated as of such date,
in form and substance reasonably satisfactory to the Collateral Trustees, either
(i)(A) stating that, in the opinion of such counsel, action has been taken with
respect to the recording, registering, filing, re-recording, re-registering and
refiling of all supplemental indentures, financing statements, continuation
statements or other instruments of further assurance as is necessary to maintain
the Lien of the Security Documents and reciting with respect to the security
interests in the Collateral the details of such action or referring to prior
opinions of counsel in which such details are given, and (B) stating that, based
on relevant laws as in effect on the date of such opinion, all financing
statements and continuation statements have been executed and filed that are
necessary as of such date and during the succeeding 12 months fully to preserve
and protect, to the extent such protection and preservation are possible by
filing, the rights of the Collateral Trustees hereunder and under the Security
Documents with respect to the security interests in the Collateral or (ii)
stating that, in the opinion of such counsel, no such action is necessary to
maintain such Lien and assignment.

 

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Section 4.9 Insurance. On the Closing Date and annually thereafter, the Loan
Parties shall deliver to the Collateral Trustees the certificate of insurance
(and the attachments thereto) and the summary schedule required by clauses (x)
and (y) of the second sentence of Section 8.1.3 of the Credit Facility
Agreement.

 

SECTION 5

 

THE COLLATERAL TRUSTEES

 

Section 5.1 Acceptance of Trust. The Collateral Trustees, for themselves and
their respective successors, hereby accepts the Collateral Trust Estate and the
trusts created by this Agreement upon the terms and conditions hereof, including
those contained in this Section 5.

 

Section 5.2 Exculpatory Provisions.

 

(a) The Collateral Trustees shall not be responsible in any manner whatsoever
for the correctness of any recitals, statements, representations or warranties
contained herein or in the Security Documents. The Collateral Trustees make no
representations as to the value or condition of the Collateral Trust Estate or
any part thereof, or as to the title of the Borrower or any other Loan Party
thereto or as to the security interest (if any) and perfection and/or priority
thereof afforded by the Security Documents or this Agreement or as to the
validity, execution (except its own execution), enforceability, legality or
sufficiency of this Agreement, any Security Document or of the Secured Debt
secured hereby and thereby, and the Collateral Trustees shall incur no liability
or responsibility in respect of any such matters. The Collateral Trustees shall
not be responsible for insuring the Collateral Trust Estate or for the payment
of taxes, charges, assessments or liens upon the Collateral Trust Estate or
otherwise as to the maintenance of the Collateral Trust Estate, except that in
the event the Collateral Trustees enter into possession of a part or all of the
Collateral Trust Estate, the Collateral Trustees shall, subject to Section 5.13,
preserve the part in its possession.

 

(b) The Collateral Trustees shall not be required to ascertain or inquire as to
the performance by the Borrower or any other Loan Party of any of the covenants
or agreements contained herein, in any Security Document or in any Debt
Instrument. Whenever it is necessary or in the opinion of the Collateral
Trustees advisable, for the Collateral Trustees to ascertain the amount of
Secured Debt then held by a Holder, the Collateral Trustees may rely on a
certificate of such Holder, an Agent with respect thereto or the Borrower as to
such amount. In the event that there shall be due to or from the Collateral
Trustees any material performance or the delivery of any material instrument or
the Collateral Trustees have actual knowledge of any material breach of this
Agreement or the Security Documents by the Borrower or any other Loan Party, the
Collateral Trustees shall promptly advise the Credit Facility Agent of the
matter and the Credit Facility Agent shall have the exclusive right to direct
the Collateral Trustees’ response to such matter.

 

(c) In any event, neither the Collateral Trustees, their respective Affiliates,
nor any of the officers, directors, employees, stockholders, agents,
attorneys-in-fact and representatives of either Collateral Trustees and such
Affiliates shall be liable for any acts or

 

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omissions by it in accordance with this Agreement or any Security Document
except for those arising out of or in connection with the Collateral Trustees’
gross negligence or willful misconduct (which shall not include action taken or
omitted to be taken in accordance with any direction, instruction or certificate
of the Credit Facility Agent, any Loan Party or any Secured Party, for which the
Collateral Trustees shall have no liability). Notwithstanding anything set forth
herein to the contrary, the Collateral Trustees shall have a duty of ordinary
care with respect to any Collateral delivered to the Collateral Trustees or its
designated representatives that are in the Collateral Trustees’ or its
designated representatives’ possession and control.

 

(d) The Collateral Trustees shall not take or refrain from taking actions if to
do so would, in the Collateral Trustees’ reasonable judgment, violate any
applicable law, regulation or court order or the terms of this Agreement, the
Debt Instruments, the Security Documents or if the Collateral Trustees shall not
be indemnified to their satisfaction as provided in Section 4.6(b) and/or
5.5(c).

 

Section 5.3 Delegation of Duties. The Collateral Trustees may execute any of the
trusts or powers hereof and perform any duty hereunder either directly or by or
through agents, nominees or attorneys-in-fact. The Collateral Trustees shall be
entitled to rely upon advice of counsel and other professionals concerning all
matters pertaining to such trusts, powers and duties. The Collateral Trustees
shall not be responsible for the negligence or misconduct of any agents,
nominees or attorneys-in-fact selected by it without gross negligence or willful
misconduct.

 

Section 5.4 Reliance by Collateral Trustees.

 

(a) Whenever in the administration of the trusts of this Agreement, or pursuant
to any of the Security Documents, the Collateral Trustees shall deem it
necessary or desirable that a matter be proved or established with respect to
the Borrower or any other Loan Party in connection with the taking, suffering or
omitting of any action hereunder by the Collateral Trustees, such matter (unless
other evidence in respect thereof be herein specifically prescribed) may be
deemed to be conclusively provided or established by a certificate of a
Responsible Officer delivered to the Collateral Trustees and such certificate
shall be full warranty to the Collateral Trustees for any action taken, suffered
or omitted in reliance thereon; subject, however, to the provisions of Section
5.5.

 

(b) The Collateral Trustees may consult with independent counsel, independent
public accountants and other experts selected by them, and any opinion of such
counsel, any such accountant, and any such other expert shall be full and
complete authorization and protection in respect of any action taken or suffered
by it hereunder in accordance therewith. The Collateral Trustees shall have the
right at any time to seek instructions concerning the administration of the
Collateral Trust Estate from any court of competent jurisdiction.

 

(c) The Collateral Trustees may rely, and shall be fully protected in acting,
upon any resolution, statement, certificate, instrument, opinion, report,
notice, request, consent, order, bond or other paper or document which they
reasonably believe to be genuine and to have been signed or presented by the
proper party or parties or, in the case of facsimiles, to have been

 

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sent by the proper party or parties. In the absence of its gross negligence or
willful misconduct, the Collateral Trustees may conclusively rely, as to the
truth of the statements and the correctness of the opinions expressed therein,
upon any certificates or opinions furnished to the Collateral Trustees and
conforming to the requirements of this Agreement or any Security Document.

 

Section 5.5 Limitations on Duties of Collateral Trustees.

 

(a) Prior to receipt of a Notice of an Actionable Default, the Collateral
Trustees shall be obligated to perform such duties and only such duties as are
specifically set forth in this Agreement or in any Security Document, and no
implied covenants or obligations shall be read into this Agreement or any
Security Document against the Collateral Trustees. The Collateral Trustees
shall, upon receipt of (x) a Notice of Actionable Default and during such time
as the Collateral Trustees shall not have received a notice of withdrawal of
such Notice of Actionable Default in accordance with the provisions of Section
2.1(b) hereof, and (y) directions in writing from the Credit Facility Agent (i)
exercise the rights and powers vested in it by this Agreement or by any Security
Document, and the Collateral Trustees shall not be liable with respect to any
action taken or omitted by it in accordance with the direction of the Credit
Facility Agent pursuant to Section 2.2 or 2.6 of this Agreement or (ii) if the
Collateral Trustees shall have received the written direction of the Credit
Facility Agent to initiate the exercise of any remedy with respect to the
Collateral, exercise such of the rights and powers vested in it by this
Agreement or by any Security Document. Subject to the provisions of Section
2.6(b) the Collateral Trustees shall follow written instructions of the Credit
Facility Agent, if any are received, as to the time, method and place of
conducting any proceeding for any right or remedy available to the Collateral
Trustees, or of exercising any trust or power conferred on the Collateral
Trustees, or for the appointment of a receiver, or for the taking of any other
action authorized by Section 2.

 

(b) The Collateral Trustees shall not be under any obligation to take an action
which is discretionary under the provisions hereof or under any Security
Document. The Collateral Trustees shall furnish to the Credit Facility Agent,
the Public Trustee and the Paying Agent promptly upon receipt thereof, a copy of
each certificate or other paper furnished to the Collateral Trustees by the
Borrower or any other Loan Party under or in respect of this Agreement, any
Security Document or any of the Collateral Trust Estate, unless by the express
terms of any Security Document a copy of the same is required to be furnished by
some other Person directly to the Credit Facility Agent, the Public Trustees and
the Paying Agent, or the Collateral Trustees shall have determined that the same
has already been so furnished.

 

(c) In connection with written instructions from the Credit Facility Agent
pursuant to Section 2.6(a), the Collateral Trustees shall be under no obligation
to exercise any of the rights, remedies or powers vested in them by this
Agreement or any Security Document, unless (i) the Collateral Trustees shall
have been provided adequate security or indemnity as determined by the
Collateral Trustees in their sole discretion (including without limitation from
the Secured Parties) against any and all costs, expenses and liabilities which
the Collateral Trustees anticipate might be reasonably incurred by them in
compliance with such instructions, including reasonable advances as may be
requested by the Collateral Trustees and (ii) the

 

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Collateral Trustees shall receive such clear, unambiguous, written instructions
as the Collateral Trustees deem appropriate.

 

(d) The obligations of the Collateral Trustees hereunder are several and not
joint.

 

Section 5.6 Moneys to Be Held in Trust. All moneys received by the Corporate
Trustee under or pursuant to any provision of this Agreement or any Security
Document shall be held in trust for the purposes for which they were paid or are
held. The Individual Trustee shall promptly turn over to the Corporate Trustee
any Collateral, or any part thereof, delivered to or received by the Individual
Trustee.

 

Section 5.7 Resignation and Removal of the Collateral Trustees.

 

(a) Each or both of the Collateral Trustees may at any time, by giving 30 days’
prior written notice to the Borrower and the Credit Facility Agent, resign and
be discharged of their responsibilities hereby created, such resignation to
become effective upon the appointment of a successor trustee or trustees by the
Borrower prior to Notice of Actionable Default, and thereafter (unless such
notice is withdrawn) by the Credit Facility Agent and the acceptance of such
appointment by such successor trustee or trustees. The Collateral Trustees shall
be entitled to their fees and expenses accrued to the date of the resignation
becoming effective. Either or both of the Collateral Trustees may be removed at
any time (with or without cause) and a successor trustee or trustees appointed
by the Borrower prior to Notice of Actionable Default, and thereafter (unless
such notice is withdrawn) by the Credit Facility Agent, provided that the
Collateral Trustees or either of them shall be entitled to their fees and
expenses accrued to the date of removal. If no successor trustee or trustees
shall be appointed and approved within 30 days from the date of the giving of
the aforesaid notice of resignation or within 30 days from the date of such
removal, the Collateral Trustees, shall, or any Holder may, apply to any court
of competent jurisdiction to appoint a successor trustee or trustees to act
until such time, if any, as a successor trustee or trustees shall have been
appointed as above provided. Any successor trustee or trustees so appointed by
such court shall immediately and without further act be superseded by any
successor trustee or trustees approved, as above provided.

 

(b) If at any time either or both of the Collateral Trustees shall resign, be
removed or otherwise become incapable of acting, or if at any time a vacancy
shall occur in the office of the Collateral Trustees for any other cause, a
successor trustee or trustees may be appointed by the Borrower, and the powers,
duties, authority and title of the predecessor trustee or trustees terminated
and cancelled without procuring the resignation of such predecessor trustee or
trustees, and without any other formality (except as may be required by
applicable law) than the appointment and designation of a successor trustee or
trustees in writing, duly acknowledged, delivered to the predecessor trustee or
trustees and the Borrower, and filed for record in each public office, if any,
in which this Agreement is required to be filed.

 

(c) The appointment and designation referred to in Section 5.7(b) of this
Agreement shall, after any required filing, be full evidence of the right and
authority to make the same and of all the facts therein recited, and this
Agreement shall vest in such successor or

 

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trustee or trustees, without any further act, deed or conveyance, all of the
estate and title of its predecessor or their predecessors, and upon such filing
for record the successor trustee or trustees shall become fully vested with all
the estates, properties, rights, powers, trusts, duties, authority and title of
its predecessor or their predecessors; but such predecessor or predecessors
shall, nevertheless, on the written request of the Credit Facility Agent, the
Borrower, or its or their successor trustee or trustees, execute and deliver an
instrument transferring to such successor or successors all the estates,
properties, rights, powers, trusts, duties, authority and title of such
predecessor or predecessors hereunder and shall deliver all securities and
moneys held by it or them to such successor trustee or trustees. Should any
deed, conveyance or other instrument in writing from the Borrower or any other
Loan Party be required by any successor trustee or trustees for more fully and
certainly vesting in such successor trustee or trustees the estates, properties,
rights, powers, trusts, duties, authority and title vested or intended to be
vested in the predecessor trustee or trustees, any and all such deeds,
conveyances and other instruments in writing shall, on request of such successor
trustee or trustees, be so executed, acknowledged and delivered.

 

(d) Any required filing for record of the instrument appointing a successor
trustee or trustees as hereinabove provided shall be at the expense of the
Borrower and the other Loan Parties. The resignation of any trustee or trustees
and the instrument or instruments removing any trustee or trustees, together
with all other instruments, deeds and conveyances provided for in this Section 5
shall, if required by law, be forthwith recorded, registered and filed by and at
the expense of the Borrower and the other Loan Parties, wherever this Agreement
is recorded, registered and filed.

 

Section 5.8 Status of Successors to the Corporate Trustee. Every successor to
the Corporate Trustee appointed pursuant to Section 5.7 of this Agreement and
every corporation resulting from a merger or consolidation pursuant to Section
5.9 of this Agreement shall be a bank or trust company in good standing and
having power so to act, incorporated under the laws of the United States or any
State thereof or the District of Columbia, and having its principal corporate
trust office within the forty-eight (48) contiguous States, and shall also have
capital, surplus and undivided profits of not less than $100,000,000, if there
be such an institution with such capital, surplus and undivided profits willing,
qualified and able to accept the trust upon reasonable or customary terms.

 

Section 5.9 Merger of the Corporate Trustee. Any corporation into which the
Corporate Trustee shall be merged, or with which it shall be consolidated, or
any corporation resulting from any merger or consolidation to which the
Corporate Trustee shall be a party, shall be the Corporate Trustee under this
Agreement without the execution or filing of any paper or any further act on the
part of the parties hereto.

 

Section 5.10 Powers of Individual Trustee. The Individual Trustee has been
joined as a party hereunder so that if, by any present or future applicable law
in any jurisdiction in which it may be necessary to perform any act in the
execution or enforcement of the trusts hereby created, the Corporate Trustee may
be incompetent, unqualified or unable to act as a Collateral Trustee or the
Corporate Trustee determines in its sole discretion not to so act as a
Collateral Trustee, then all of the acts required to be performed in such
jurisdiction, in the

 

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execution or enforcement of the trusts hereby created, shall and will be
performed by the Individual Trustee, acting alone. Notwithstanding any other
term or provision of this Agreement to the contrary, the Corporate Trustee alone
shall have and exercise the rights and powers granted herein and shall be solely
charged with the performance of the duties herein declared on the part of the
Collateral Trustees to be had and exercised or to be performed without any
action taken by the Individual Trustee; provided, however, that if the Corporate
Trustee deems it necessary or desirable for the Individual Trustee to act in a
particular jurisdiction, the Individual Trustee shall have and exercise the
rights and powers granted herein (but no greater powers) and shall be charged
with the performance of the duties herein declared on the part of the Collateral
Trustees to be had and exercised or to be performed, but only in such particular
jurisdiction.

 

Section 5.11 Additional Co-Trustees; Separate Trustees.

 

(a) If at any time or times it shall be necessary or prudent in order to conform
to any law, regulation or court order of any jurisdiction in which any of the
Collateral shall be located, or the Collateral Trustees shall be advised by
counsel, satisfactory to them, that it is so necessary or prudent in the
interest of the Holders, or the Credit Facility Agent shall in writing so
request, or the Collateral Trustees shall deem it desirable for their own
protection in the performance of their duties hereunder, the Collateral Trustees
and the Borrower and the other Loan Parties, as applicable, shall execute and
deliver all instruments and agreements necessary or proper to constitute another
bank or trust company, or one or more persons approved by the Collateral
Trustees, the Borrower and the Credit Facility Agent either to act as co-trustee
or co-trustees of all or any of the Collateral, jointly with the Collateral
Trustees originally named herein or any successor or successors, or to act as
separate trustee or trustees of any such property. In the event the Borrower and
the other Loan Parties, as applicable, shall not have joined in the execution of
such instruments and agreements within ten (10) days after the receipt of a
written request from the Collateral Trustees so to do, or in case an Actionable
Default shall have occurred and be continuing, the Collateral Trustees may act
under the foregoing provisions of this Section 5.11 without the concurrence of
the Borrower, and each of the Borrower and the other Loan Parties hereby
irrevocably appoints the Collateral Trustees, and each of them, as its agent and
attorney to act for it under the foregoing provisions of this Section 5.11 in
either of such contingencies. Each Loan Party acknowledges and agrees that the
foregoing power of attorney is coupled with an interest and may not be revoked
or modified except with the consent of the Collateral Trustees or as otherwise
provided herein.

 

(b) Every separate trustee and every co-trustee (other than any trustee which
may be appointed as successor to the Corporate Trustee or the Individual Trustee
pursuant to Section 5.7), shall, to the extent permitted by law, be appointed
and act and be such, subject to the following provisions and conditions, namely:

 

(i) all rights, powers, duties and obligations conferred upon the Collateral
Trustees in respect of the custody, control and management of moneys, papers or
securities shall be exercised solely by the Collateral Trustees, or their
respective successors as Collateral Trustees hereunder;

 

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(ii) all rights, powers, duties and obligations conferred or imposed upon the
Collateral Trustees hereunder shall be conferred or imposed and exercised or
performed by the Collateral Trustees and such separate trustee or separate
trustees or co-trustee or co-trustees, jointly, as shall be provided in the
instrument appointing such separate trustee or separate trustees or co-trustee
or co-trustees, except to the extent that under any law of any jurisdiction in
which any particular act or acts are to be performed, the Collateral Trustees
shall be incompetent or unqualified to perform such act or acts, in which event
such rights, powers, duties and obligations shall be exercised and performed by
such separate trustee or separate trustees or co-trustee or co-trustees;

 

(iii) no power given hereby to, or which it is provided hereby may be exercised
by, any such co-trustee or co-trustees or separate trustee or separate trustees,
shall be exercised hereunder by such co-trustee or co-trustees or separate
trustee or separate trustees, except jointly with, or with the consent in
writing of, the Collateral Trustees, anything herein contained to the contrary
notwithstanding;

 

(iv) no trustee hereunder shall be personally liable by reason of any act or
omission of any other trustee hereunder; and

 

(v) the Borrower, the Credit Facility Agent and the Collateral Trustees, at any
time by an instrument in writing, executed by them jointly, may accept the
resignation of or remove any such separate trustee or co-trustee, and in that
case, by an instrument in writing executed by the Borrower, the Credit Facility
Agent and the Collateral Trustees jointly, may appoint a successor to such
separate trustee or co-trustee, as the case may be, anything herein contained to
the contrary notwithstanding. In the event that the Borrower shall not have
joined in the execution of any such instrument within ten (10) days after the
receipt of a written request from the Collateral Trustees so to do, or in case
an Actionable Default shall have occurred and be continuing, the Collateral
Trustees shall have the power to accept the resignation of or remove any such
separate trustee or co-trustee and to appoint a successor without the
concurrence of the Borrower or the other Loan Parties, each of the Borrower and
the other Loan Parties hereby irrevocably appointing the Collateral Trustees its
agent and attorney to act for it in such connection in either of such
contingencies. In the event that the Collateral Trustees shall have appointed a
separate trustee or separate trustees or co-trustee or co-trustees as above
provided, it may at any time, by an instrument in writing, accept the
resignation of or remove any such separate trustee or co-trustee, the successor
to any such separate trust or co-trustee to be appointed by the Borrower and the
Collateral Trustees, or by the Collateral Trustees alone, as hereinabove
provided in this Section 5.11.

 

Section 5.12 Ordinary Care. The Collateral Trustees shall be deemed to have
exercised ordinary care in the custody and preservation of the Collateral in
their possession if the Collateral is accorded treatment substantially equal to
that which the Collateral Trustees accord their own property, it being
understood that the Collateral Trustees shall not have any

 

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responsibility for (i) ascertaining or taking action with respect to calls,
conversions, exchanges, maturities, tenders or other matters relative to any
Collateral, whether or not the Collateral Trustees have or are deemed to have
knowledge of such matters, (ii) taking any necessary steps to preserve rights
against any parties with respect to any Collateral or (iii) taking any action
other than as directed by the Credit Facility Agent after compliance with
Section 5.5(c) hereof.

 

SECTION 6

 

RELEASE OF COLLATERAL

 

Section 6.1 Condition to Release.

 

All, or the designated portion of (in the case of a release pursuant to Section
6.1(ii)), the Collateral shall be released on the earlier of:

 

(i) the date on which (A) all obligations owing to the Credit Facility Lenders
shall have been satisfied and all obligations of the Credit Facility Lenders
under the Credit Facility Documents shall have terminated and (B) accrued and
unpaid Trustees’ Fees shall have been paid in full; or

 

(ii) the date on which the Borrower delivers a Release Notice.

 

Section 6.2 Procedure for Release.

 

(a) Upon the receipt by the Collateral Trustees of notice by Borrower of the
event specified in Section 6.1(i) or upon receipt by the Collateral Trustees of
a Release Notice, the Collateral Trustees shall forthwith send written notice
thereof to the Credit Facility Agent, the Public Trustee and the Paying Agent
(with a copy of any Release Notice). If, within five (5) Business Days after
receipt by the Collateral Trustees, of a notice described in the first sentence
of this clause (a), the Collateral Trustees shall not have received a
certificate in writing from the Credit Facility Agent stating that it believes
in good faith, that the event specified in such notice has not occurred, then
the Collateral Trustees shall, to the extent requested by the Borrower, take the
actions set forth in Section 6.3; provided that if any such notice described in
the first sentence of this clause (a) is executed by the Credit Facility Agent,
such period shall not apply and Collateral Trustees promptly shall, to the
extent requested by the Borrower, take the actions set forth in Section 6.3.

 

(b) If the Collateral Trustees receive a certificate from the Credit Facility
Agent to the effect set forth in Section 6.2(a) within the period therein
specified, the Collateral will not be released, and the Collateral Trustees will
not take any actions requested of it by the Borrower until such certificate
shall be withdrawn in writing by the Credit Facility Agent, or the Collateral
Trustees shall have received a final order of a court of competent jurisdiction
either directing it to release the applicable Collateral or determining that the
conditions to the release of the Collateral specified in Section 6.1 have been
satisfied.

 

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Section 6.3 Effective Time of Release.

 

(a) The release of the applicable Collateral shall be effective (i) upon the
occurrence of the events specified in Section 6.1(i), (ii) in connection with an
event described in Section 6.1(ii), upon the expiration of five (5) Business
Days following receipt by the Collateral Trustees of a Release Notice not
executed by the Credit Facility Agent unless, prior to the expiration of such
period, the Collateral Trustees shall have received a certificate in writing
from the Credit Facility Agent to the effect set forth in Section 6.2(a), in
which event the release of Collateral shall not be effective until the date on
which any of the events set forth in Section 6.2(b) shall occur.

 

(b) (i) Upon the effectiveness of the release of all the Collateral, all right,
title and interest of the Collateral Trustees in, to and under the Collateral
Trust Estate, the Collateral and the Security Documents, and (except as
otherwise provided in Section 7.7) the Collateral Trustees’ obligations and
liabilities under this Agreement, shall terminate and shall revert to the
Borrower or the applicable Loan Party, as the case may be, or its successors and
assigns, and the estate, right, title and interest of the Collateral Trustees
therein shall thereupon cease, and in such case, upon the written request of the
Borrower or any Loan Party or its successors or assigns, and at the cost and
expense of the Borrower or such Loan Party or its successors or assigns, the
Collateral Trustees shall execute a satisfaction of the Security Documents and
such other instruments, documents or agreements as Borrower or any Loan Party
may request or may be necessary or desirable to terminate and remove of record
any documents constituting public notice of the Security Documents and the
security interests and assignments granted thereunder and shall assign and
transfer, or cause to be assigned and transferred, and shall deliver or cause to
be delivered to the Borrower or the applicable Loan Party, as the case may be,
all property, including all moneys, instruments and securities of the Borrower
then held by the Collateral Trustees. The cancellation and satisfaction of the
Security Documents shall be without prejudice to the rights of the Collateral
Trustees or any successor trustee to charge and be reimbursed for any
expenditures which it may thereafter incur in connection therewith.

 

(ii) Upon the effectiveness of the release of a portion of the Collateral as
specified in the applicable Release Notice (the “Released Collateral”), all
right, title and interest of the Collateral Trustees in, to and under the
Released Collateral shall terminate and shall revert to the Borrower or the
applicable Loan Party, as the case may be, or its successors and assigns, and
the estate, right, title and interest of the Collateral Trustees therein shall
thereupon cease. Upon the written request of the Borrower or any Loan Party or
its successors or assigns, and at the cost and expense of the Borrower or its
successors or assigns, the Collateral Trustees shall execute such instruments,
documents or agreements as Borrower or such Loan Party may request or may be
necessary or desirable to terminate and remove of record any documents
constituting public notice of the security interests and assignments granted in
such Released Collateral under the Security Documents.

 

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SECTION 7

 

MISCELLANEOUS

 

Section 7.1 Amendments, Supplements and Waivers.

 

(a) Subject to Section 7.1(b), at the written direction of the Credit Facility
Agent and the Borrower, the Collateral Trustees shall, from time to time, enter
into written agreements supplemental hereto for the purpose of adding to or
waiving any provision of this Agreement or any of the Security Documents or
amending the definition of any capitalized term used herein or therein, as such
capitalized term is used herein or therein, or changing in any manner the rights
of the Collateral Trustees, the Holders or the Borrower hereunder or thereunder;
provided, however, that no such supplemental agreement or amendment shall:

 

(i) result in a breach of a provision or covenant contained in either the Public
Indenture or the Paying Agency Agreement providing for the securing of
indebtedness thereunder equally and ratably with other indebtedness or
obligations of the Borrower or any of its subsidiaries,

 

(ii) amend, modify or waive any provision of this Agreement or any Security
Document so as to adversely affect any of the Collateral Trustees’ rights,
immunities or indemnities hereunder or thereunder or enlarge its duties
hereunder or thereunder, without the written consent of the Collateral Trustees;
and

 

(iii) unless in writing and signed by the Individual Trustee, amend, waive or
otherwise modify any provision of Section 5.10.

 

Any such supplemental agreement shall be binding upon the Borrower, the other
Loan Parties, the Holders and the Collateral Trustees and their respective
successors and assigns. The Collateral Trustees shall not enter into any such
supplemental agreement or amendment unless it shall have received an instruction
letter from the Credit Facility Agent requesting the Corporate Trustee and
Individual Trustee to execute such supplemental agreement or amendment and a
certificate signed by a Responsible Officer to the effect that such supplemental
agreement or amendment will not result in a breach of any provision or covenant
contained in the Public Indenture and the Paying Agency Agreement.

 

(b) Subject to the consent of the Credit Facility Agent (whose consent shall be
required for any amendments or supplements or modifications to this Agreement or
any Security Document or to any new Security Document), and without limiting the
generality of the foregoing, the Borrower, the other Loan Parties and the
Collateral Trustees, at any time and from time to time, may amend or modify the
Security Documents or enter into additional Security Documents or one or more
agreements supplemental hereto or to any Security Document, in form satisfactory
to the Collateral Trustees,

 

(i) to add to the covenants of the Borrower for the benefit of the Holders;

 

(ii) to mortgage, pledge or grant a security interest in favor of the Collateral
Trustees as additional security for the Secured Debt pursuant to any Security
Document; or

 

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(iii) to cure any ambiguity, to correct or supplement any provision herein or in
any Security Document which may be defective or inconsistent with any other
provision herein or therein.

 

Section 7.2 Notices. Except as otherwise expressly provided herein, all notices
and other communications shall be given to the respective parties at the address
set forth below, or at such other address as such party may specify by written
notice to the other party hereto:

 

If to the Borrower, at CONSOL Energy Inc, Consol Plaza, 1800 Washington Road,
Pittsburgh, PA 15241-1421, Attention: Treasurer

 

if to the Collateral Trustees:

 

If to the Corporate Trustee, at Rodney Square North, 1100 North Market St.,
Wilmington, DE 19890, Attention: Corporate Trust Division, or at such other
address as shall be designated by it in a written notice to the Loan Parties and
each Agent, with a copy to the Individual Trustee, c/o Wilmington Trust Company,
at 1100 North Market St. Rodney Square North Wilmington, DE 19890, Attention:
Corporate Trust Division, or at such other address as shall be designated by him
in a written notice to the Loan Parties and each Agent; provided that failure to
send a copy of any notice to the Individual Trustee shall not render any notice
to the Collateral Trustees ineffective

 

if to the Public Trustee, the Credit Facility Agent, or the Paying Agent: to it
at the address specified from time to time in the list provided by the Borrower
to the Collateral Trustees.

 

All such notices, requests, demands and communications shall, to be effective
hereunder, be in writing, and shall be deemed to have been given or made upon
receipt if delivered by hand, upon receipt if given by overnight courier, four
(4) days after its deposit in the mail, first class or air postage prepaid with
return receipt requested, or in the case of notice by facsimile transmission,
when sent to the applicable party’s facsimile machine’s telephone number if the
party sending such notice receives confirmation of the delivery thereof from its
own facsimile machine; provided that a copy is sent by hand, overnight courier
or mail, first class or air postage prepaid with return receipt requested
following such facsimile transmission.

 

Section 7.3 Headings. Section, subsection and other headings used in this
Agreement are for convenience only and shall not affect the construction of this
Agreement.

 

Section 7.4 Severability. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall not invalidate the remaining provisions
hereof, and any such prohibition or unenforceability in any jurisdiction shall
not invalidate or render unenforceable of such provision in any other
jurisdiction, provided that this Agreement shall be construed so as to give
effect to the intention expressed in Section 2.11 hereof.

 

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Section 7.5 Treatment of Payee or Indorsee by Collateral Trustees.

 

(a) The Collateral Trustees may treat the registered holder of any registered
note, and the payee or indorsee of any note or debenture which is not
registered, as the absolute owner thereof for all purposes hereunder and shall
not be affected by any notice to the contrary, whether such note or debenture
shall be past due or not.

 

(b) Any Person which shall be designated as the duly authorized representative
of one or more Holders of Secured Debt to act as such in connection with any
matters pertaining to this Agreement or any Security Document or the Collateral
shall present to the Collateral Trustees such documents, including, without
limitation, opinions of counsel, as the Collateral Trustees may reasonably
require, in order to demonstrate to the Collateral Trustees the authority of
such Person to act as the representative of such Holders.

 

Section 7.6 Dealings with the Borrower.

 

(a) Upon any application or demand by the Borrower or the other Loan Parties to
the Collateral Trustees to take or permit any action under any of the provisions
of this Agreement or any Security Document, the Borrower shall furnish to the
Collateral Trustees a certificate signed by a Responsible Officer stating that
all conditions precedent, if any, provided for in this Agreement or any Security
Document relating to the proposed action have been complied with.

 

(b) Any opinion of counsel may be based, insofar as it relates to factual
matters, upon a certificate of Responsible Officers delivered to the Collateral
Trustees.

 

Section 7.7 Claims Against the Collateral Trustees. Any claims or causes of
action which the Credit Facility Lenders, the Public Trustee, the Paying Agency
Agreement Lenders or any other Holders of Secured Debt or the Borrower or the
other Loan Parties shall have against the Collateral Trustees shall survive the
termination of this Agreement and the release of the Collateral hereunder.

 

Section 7.8 Binding Effect. This Agreement shall be binding upon and inure to
the benefit of each of the parties hereto and shall inure to the benefit of the
Holders and their respective successors and assigns, and nothing herein or in
any Security Document is intended or shall be construed to give any other Person
any right, remedy or claim under, to or in respect of this Agreement, any
Security Document, the Collateral or the Collateral Trust Estate.

 

Section 7.9 Conflict with Other Agreements. The parties agree that in the event
of any conflict between the provisions of this Agreement and the provisions of
any of the Security Documents, the provisions of this Agreement shall control.
Notwithstanding any provision in any of the Security Documents to the contrary,
the parties and signatories hereto acknowledge and agree that any and all
rights, powers, privileges, duties, responsibilities, liabilities and/or
obligations (including but not limited to the right to grant or withhold consent
and the right to act or refrain from acting), whether discretionary or
mandatory, are and shall be exercised by the Collateral Trustees solely in
accordance with the terms and conditions of this

 

29

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Agreement, at the direction of the Credit Facility Agent or other entity
specified in this Agreement as having the right to give direction to the
Collateral Trustees, and subject further to the rights of the Collateral
Trustees to require officers’ certificate(s), opinion(s) and advice from
counsel, accountants, appraisers and other third parties, advancement of
expenses and/or assurances of indemnity satisfactory to the Collateral Trustees.
If no direction or insufficient direction of the Credit Facility Agent or other
entity specified in this Agreement as having the right to give direction to the
Collateral Trustees is received by the Collateral Trustees, the Collateral
Trustees shall have no obligation or responsibility whatsoever to take any
action in connection with this Agreement, any Security Document or any other
agreement or instrument with respect to any Collateral, and nothing contained in
any Security Document or any other agreement or instrument with respect to any
Collateral shall create, expand or otherwise increase in any manner whatsoever
the duties, responsibilities, liabilities and/or obligations of the Collateral
Trustees set forth in this Agreement.

 

Section 7.10 Governing Law. The provisions of this Agreement creating a trust
for the benefit of the Secured Parties and setting forth the rights, duties,
obligations and responsibilities of the Collateral Trustees hereunder shall be
governed by and construed in accordance with the laws of the State of Delaware,
so long as Wilmington Trust Company shall serve as Corporate Trustee hereunder.
In all other respects, including, without limitation, all matters governed by
the Uniform Commercial Code, and if Wilmington Trust Company shall cease to
serve as Corporate Trustee hereunder, this Agreement shall be governed by and
construed in accordance with the laws of the State of New York, except as
otherwise required by mandatory provisions of law.

 

Section 7.11 Joinder of Additional Designated Subsidiaries. Any Subsidiary of
the Borrower (which was not previously a Loan Party) which grants a Lien as
security for the Secured Debt shall join this Agreement as a Loan Party by
executing and delivering to the Collateral Trustees (i) a Collateral Trust
Joinder in substantially the form attached hereto as Exhibit A, (ii) appropriate
Security Documents, in a form substantially similar to the Security Documents
provided by the other Loan Parties, in favor of the Collateral Trustee as
security for the Secured Debt, and (iii) opinions of counsel set forth in
Section 4.8(a) hereof.

 

Section 7.12 Additional Collateral. Any Loan Party which is required, in
accordance with the Credit Facility Agreement, to grant a Lien on additional
Collateral (not presently secured by the Security Documents) shall execute and
deliver to the Collateral Trustees (i) appropriate Security Documents, in a form
substantially similar to the Security Documents provided by the other Loan
Parties, in favor of the Collateral Trustee as security for the Secured Debt,
and (ii) opinions of counsel set forth in Section 4.8(a) hereof.

 

Section 7.13 Counterparts. This Agreement may be executed in separate
counterparts, each of which shall be an original and all of which taken together
shall constitute one and the same instrument.

 

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Section 7.14 CONSENT TO FORUM; WAIVER OF JURY TRIAL.

 

(a) EACH PARTY HERETO IRREVOCABLY CONSENTS TO THE NONEXCLUSIVE JURISDICTION OF
THE COURT OF COMMON PLEAS OF ALLEGHENY COUNTY AND THE UNITED STATES DISTRICT
COURT FOR THE WESTERN DISTRICT OF PENNSYLVANIA, AND WAIVES PERSONAL SERVICE OF
ANY AND ALL PROCESS UPON IT AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS BE
MADE BY CERTIFIED OR REGISTERED MAIL DIRECTED TO SUCH PARTY AT THE ADDRESSES
PROVIDED FOR IN SECTION 7.2 AND SERVICE SO MADE SHALL BE DEEMED TO BE COMPLETED
UPON ACTUAL RECEIPT THEREOF.

 

(b) NOTWITHSTANDING ANYTHING TO THE CONTRARY IN SECTION 7.14(a), SO LONG AS
WILMINGTON TRUST COMPANY SHALL SERVE AS CORPORATE TRUSTEE HEREUNDER, ANY SUIT,
CLAIM, DEMAND OR OTHER LEGAL OR ABRITRAL PROCEEDING, WHETHER AT LAW OR IN
EQUITY, AGAINST EITHER OR BOTH OF THE COLLATERAL TRUSTEES SHALL BE BROUGHT ONLY
IN THE STATE AND FEDERAL COURTS LOCATED IN WILMINGTON, DELAWARE. FOR PURPOSES OF
THIS SECTION 7.14(b), EACH PARTY HERETO IRREVOCABLY CONSENTS TO THE EXCLUSIVE
JURISDICTION OF THE STATE AND FEDERAL COURTS LOCATED IN WILMINGTON, DELAWARE,
AND WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS UPON IT AND CONSENTS THAT ALL
SUCH SERVICE OF PROCESS BE MADE BY CERTIFIED OR REGISTERED MAIL DIRECTED TO SUCH
PARTY AT THE ADDRESSES PROVIDED FOR IN SECTION 7.2 AND SERVICE SO MADE SHALL BE
DEEMED TO BE COMPLETED UPON ACTUAL RECEIPT THEREOF.

 

(c) EACH PARTY HERETO WAIVES ANY OBJECTION TO JURISDICTION AND VENUE OF ANY
ACTION INSTITUTED AGAINST IT AS PROVIDED IN SECTION 7(a) AND 7(b) ABOVE AND
AGREES NOT TO ASSERT ANY DEFENSE BASED ON LACK OF JURISDICTION OR VENUE. EACH
PARTY HERETO WAIVE TRIAL BY JURY IN ANY ACTION, SUIT, PROCEEDING OR COUNTERCLAIM
OF ANY KIND ARISING OUT OF OR RELATED TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT
OR THE COLLATERAL TO THE FULL EXTENT PERMITTED BY LAW.

 

Section 7.15 Confidentiality. The Collateral Trustees agree to keep confidential
all information obtained from any Loan Party or its Subsidiaries which is
nonpublic and confidential or proprietary in nature, including any information
the Borrower specifically designates as confidential (except that the Collateral
Trustees shall be permitted to disclose such information in the same
circumstances that the Paying Agent is permitted to disclose such information
under Section 11.12 of the Credit Agreement), and to use such information only
in connection with their respective capacities under this Agreement and for the
purposes contemplated hereby and by the Security Documents; provided that
nothing herein shall limit the Collateral Trustees’ right or obligation to
communicate with Secured Parties as provided herein.

 

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement or caused
this Agreement to be duly executed by their respective officers thereunto duly
authorized as of the day and year first above written.

 

       

CONSOL ENERGY INC.

           

By: 

                     

Corporate Trustee:

      WILMINGTON TRUST COMPANY, not in its individual capacity, but solely as
Corporate Trustee            

By: 

                     

Individual Trustee:

                DAVID A. VANASKEY, not in his individual capacity, but solely as
Individual Trustee

 

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SCHEDULE 1.1

 

TO

 

COLLATERAL TRUST AGREEMENT

 

1. Security Agreement executed on June 30, 2004 among CONSOL Energy Inc., each
of the other parties thereto and Wilmington Trust Company, as Collateral
Trustee.

 

2. Pledge Agreement executed on June 30, 2004 among each of the Pledgors party
thereto and Wilmington Trust Company, as Collateral Trustee.

 

3. Patent, Trademark and Copyright Security Agreement executed on June 30, 2004
among each of the Pledgors party thereto and Wilmington Trust Company, as
Collateral Trustee.

 

4. First Preferred Fleet Mortgage executed on June 30, 2004 between
CONSOLIDATION COAL COMPANY and Wilmington Trust Company, as Collateral Trustee.

 

5. First Preferred Ship Mortgage executed on June 30, 2004 between Quarto Mining
Company and Wilmington Trust Company, as Collateral Trustee.

 

6. Account Control Agreement executed on June 30, 2004 among CONSOLIDATION COAL
COMPANY, Wilmington Trust Company, as Collateral Trustee, and Citibank, N.A.

 

7. Account Control Agreement executed on June 30, 2004 among CONSOLIDATION COAL
COMPANY, Wilmington Trust Company, as Collateral Trustee, and PNC Bank, National
Association.

 

8. Securities Account Control Agreement executed on June 30, 2004 among CONSOL
Energy Inc., Wilmington Trust Company, as Collateral Trustee, and PNC Bank,
National Association.

 

9. Regulated Substances Certificate and Indemnity Agreement executed on June 30,
2004 among CONSOL Energy Inc., each Guarantor party thereto, Wilmington Trust
Company, as Corporate Trustee, and David A. Vanaskey, as Individual Trustee.

 

10. Credit Line Deed of Trust, Assignment of Rents and Leases, Security
Agreement, Financing Statement and Fixture Filing executed on June 14, 2004,
effective June 30, 2004, and recorded in Marshall County, West Virginia, by
RESERVE COAL PROPERTIES COMPANY, and CONSOL Pennsylvania Coal Company,
collectively, as Grantor, to James A. Russell, as Trustee, for the benefit of
David A. Vanaskey, Collateral Trustee, as Beneficiary, encumbering that certain
Alexander Reserve.

 

--------------------------------------------------------------------------------

11. Open-End Mortgage, Assignment of Rents and Leases, Security Agreement,
Financing Statement and Fixture Filing executed on June 14, 2004, effective June
30, 2004, and recorded in Fayette County, Pennsylvania, by Consol Docks Inc., as
Mortgagor, to David A. Vanaskey, Collateral Trustee, as Mortgagee, encumbering
that certain Alicia Dock Facility.

 

12. Deed of Trust, Assignment of Rents and Leases, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in Tazewell County, Virginia, by RESERVE COAL PROPERTIES COMPANY,
CONSOLIDATION COAL COMPANY, and CONSOL Pennsylvania Coal Company, collectively,
as Grantor, to BI Mortgage Trustee LLC, as Trustee, for the benefit of David A.
Vanaskey, Collateral Trustee, as Beneficiary, encumbering that certain Amonate
Mine.

 

13. Credit Line Deed of Trust, Assignment of Rents and Leases, Security
Agreement, Financing Statement and Fixture Filing executed on June 14, 2004,
effective June 30, 2004, and recorded in McDowell County, West Virginia, by
RESERVE COAL PROPERTIES COMPANY, CONSOLIDATION COAL COMPANY, and CONSOL
Pennsylvania Coal Company, collectively, as Grantor, to James A. Russell, as
Trustee, for the benefit of David A. Vanaskey, Collateral Trustee, as
Beneficiary, that certain Amonate Mine.

 

14. Credit Line Deed of Trust, Assignment of Rents and Leases, Security
Agreement, Financing Statement and Fixture Filing executed on June 14, 2004,
effective June 30, 2004, and recorded in Marshall County, West Virginia, by
RESERVE COAL PROPERTIES COMPANY, CONSOLIDATION COAL COMPANY, Conrhein Coal
Company, and CONSOL Pennsylvania Coal Company, collectively, as Grantor, to
James A. Russell, as Trustee, for the benefit of David A. Vanaskey, Collateral
Trustee, as Beneficiary, encumbering that certain Bailey Mine/Enlow Fork
Complex.

 

15. Open-End Mortgage, Assignment of Rents and Leases, Security Agreement,
Financing Statement and Fixture Filing executed on June 14, 2004, effective June
30, 2004, and recorded in Greene County, Pennsylvania, by RESERVE COAL
PROPERTIES COMPANY, CONSOLIDATION COAL COMPANY, Conrhein Coal Company, and
CONSOL Pennsylvania Coal Company, collectively, as Mortgagor, to David A.
Vanaskey, Collateral Trustee, as Mortgagee, encumbering that certain Bailey
Mine/Enlow Fork Complex.

 

16. Open-End Mortgage, Assignment of Rents and Leases, Security Agreement,
Financing Statement and Fixture Filing executed on June 14, 2004, effective June
30, 2004, and recorded in Washington County, Pennsylvania, by RESERVE COAL
PROPERTIES COMPANY, CONSOLIDATION COAL COMPANY, Conrhein Coal Company, and
CONSOL Pennsylvania Coal Company, collectively, as Mortgagor, to David A.
Vanaskey, Collateral Trustee, as Mortgagee, encumbering that certain Bailey
Mine/Enlow Fork Complex.

 

17. Open-End Mortgage, Assignment of Rents and Leases, Security Agreement,
Financing Statement and Fixture Filing executed on June 14, 2004, effective June
30, 2004, and recorded in Washington County, Pennsylvania, by CONSOLIDATION COAL
COMPANY and CONSOL Pennsylvania Coal Company, collectively, as Mortgagor, to
David A. Vanaskey, Collateral Trustee, as Mortgagee, encumbering that certain
Berkshire Reserve.

 

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18. Credit Line Deed of Trust, Assignment of Rents and Leases, Security
Agreement, Financing Statement and Fixture Filing executed on June 14, 2004,
effective June 30, 2004, and recorded in Braxton County, West Virginia, by
WOLFPEN KNOB DEVELOPMENT COMPANY, as Grantor, to James A. Russell, as Trustee,
for the benefit of David A. Vanaskey, Collateral Trustee, as Beneficiary,
encumbering that certain Birch Reserve.

 

19. Credit Line Deed of Trust, Assignment of Rents and Leases, Security
Agreement, Financing Statement and Fixture Filing executed on June 14, 2004,
effective June 30, 2004, and recorded in Clay County, West Virginia, by WOLFPEN
KNOB DEVELOPMENT COMPANY, as Grantor, to James A. Russell, as Trustee, for the
benefit of David A. Vanaskey, Collateral Trustee, as Beneficiary, encumbering
that certain Birch Reserve.

 

20. Credit Line Deed of Trust, Assignment of Rents and Leases, Security
Agreement, Financing Statement and Fixture Filing executed on June 14, 2004,
effective June 30, 2004, and recorded in Nicholas County, West Virginia, by
WOLFPEN KNOB DEVELOPMENT COMPANY, as Grantor, to James A. Russell, as Trustee,
for the benefit of David A. Vanaskey, Collateral Trustee, as Beneficiary,
encumbering that certain Birch Reserve.

 

21. Open-End Mortgage, Assignment of Rents and Leases, Security Agreement,
Financing Statement and Fixture Filing executed on June 14, 2004, effective June
30, 2004, and recorded in Greene County, Pennsylvania, by CONSOLIDATION COAL
COMPANY and CNX Gas Company LLC, collectively, as Mortgagor, to David A.
Vanaskey, Collateral Trustee, as Mortgagee, encumbering that certain Blacksville
#2 Mine.

 

22. Credit Line Deed of Trust, Assignment of Rents and Leases, Security
Agreement, Financing Statement and Fixture Filing executed on June 14, 2004,
effective June 30, 2004, and recorded in Monongalia County, West Virginia, by
CONSOLIDATION COAL COMPANY and CNX Gas Company LLC, collectively, as Grantor, to
James A. Russell, as Trustee, for the benefit of David A. Vanaskey, Collateral
Trustee, as Beneficiary, encumbering that certain Blacksville #2 Mine.

 

23. Open-End Mortgage, Assignment of Rents and Leases, Security Agreement,
Financing Statement and Fixture Filing executed on June 14, 2004, effective June
30, 2004, and recorded in Greene County, Pennsylvania, by RESERVE COAL
PROPERTIES COMPANY, CONSOLIDATION COAL COMPANY and CNX Gas Company LLC,
collectively, as Mortgagor, to David A. Vanaskey, Collateral Trustee, as
Mortgagee, encumbering that certain Blacksville #3 Reserve.

 

24. Credit Line Deed of Trust, Assignment of Rents and Leases, Security
Agreement, Financing Statement and Fixture Filing executed on June 14, 2004,
effective June 30, 2004, and recorded in Monongalia County, West Virginia, by
RESERVE COAL PROPERTIES COMPANY, CONSOLIDATION COAL COMPANY, and CNX Gas Company
LLC, collectively, as Grantor, to James A. Russell, as Trustee, for the benefit
of David A. Vanaskey, Collateral Trustee, as Beneficiary, encumbering that
certain Blacksville #3 Reserve.

 

25. Deed of Trust, Assignment of Rents and Leases, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in

 

--------------------------------------------------------------------------------

Buchanan County, Virginia, by RESERVE COAL PROPERTIES COMPANY, CONSOLIDATION
COAL COMPANY, and CNX Gas Company LLC, collectively, as Grantor, to BI Mortgage
Trustee LLC, as Trustee, for the benefit of David A. Vanaskey, Collateral
Trustee, as Beneficiary, encumbering that certain Buchanan Mine.

 

26. Mortgage, Assignment of Rents and Leases, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in Clark County Illinois, by RESERVE COAL PROPERTIES COMPANY, as
Mortgagor, to David A. Vanaskey, Collateral Trustee, as Mortgagee, encumbering
that certain Clark County Reserve.

 

27. Mortgage, Assignment of Rents and Leases, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in Vermilion County Illinois, by RESERVE COAL PROPERTIES COMPANY,
CONSOL Pennsylvania Coal Company, and CNX Marine Terminals Inc., collectively,
as Mortgagor, to David A. Vanaskey, Collateral Trustee, as Mortgagee,
encumbering that certain Danville Reserve.

 

28. Mortgage, Assignment of Rents and Leases, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in Edgar County Illinois, by RESERVE COAL PROPERTIES COMPANY,
CONSOL Pennsylvania Coal Company, and CNX Marine Terminals Inc., collectively,
as Mortgagor, to David A. Vanaskey, Collateral Trustee, as Mortgagee,
encumbering that certain Danville Reserve.

 

29. Open-End Mortgage, Assignment of Rents and Leases, Security Agreement,
Financing Statement and Fixture Filing executed on June 14, 2004, effective June
30, 2004, and recorded in Washington County, Pennsylvania, by Eighty-Four Mining
Company, ISLAND CREEK COAL COMPANY, Laurel Run Mining Company, and RESERVE COAL
PROPERTIES COMPANY, collectively, as Mortgagor, to David A. Vanaskey, Collateral
Trustee, as Mortgagee, encumbering that certain Eighty-Four Mine.

 

30. Mortgage, Assignment of Rents and Leases, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in Emery County, Utah, by CONSOLIDATION COAL COMPANY, as Mortgagor,
to David A. Vanaskey, Collateral Trustee, as Mortgagee, encumbering that certain
Emery Mine.

 

31. Open-End Mortgage, Assignment of Rents and Leases, Security Agreement,
Financing Statement and Fixture Filing executed on June 14, 2004, effective June
30, 2004, and recorded in Washington County, Pennsylvania, by CNX Marine
Terminals Inc., RESERVE COAL PROPERTIES COMPANY and CONSOLIDATION COAL COMPANY,
collectively, as Mortgagor, to David A. Vanaskey, Collateral Trustee, as
Mortgagee, encumbering that certain Fallowfield Reserve.

 

32. Open-End Mortgage, Assignment of Rents and Leases, Security Agreement,
Financing Statement and Fixture Filing executed on June 14, 2004, effective June
30, 2004, and recorded in Greene County, Pennsylvania, by CONSOL Pennsylvania
Coal Company, as

 

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Mortgagor, to David A. Vanaskey, Collateral Trustee, as Mortgagee, encumbering
that certain Greene Hill Reserve.

 

33. Mortgage, Assignment of Rents and Leases, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in Hamilton County, Illinois, by RESERVE COAL PROPERTIES COMPANY,
as Mortgagor, to David A. Vanaskey, Collateral Trustee, as Mortgagee,
encumbering that certain Hamilton Reserve.

 

34. Mortgage, Assignment of Rents and Leases, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in Saline County, Illinois, by RESERVE COAL PROPERTIES COMPANY, as
Mortgagor, to David A. Vanaskey, Collateral Trustee, as Mortgagee, encumbering
that certain Hamilton Reserve.

 

35. Mortgage, Assignment of Rents and Leases, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in Franklin County, Illinois, by RESERVE COAL PROPERTIES COMPANY,
as Mortgagor, to David A. Vanaskey, Collateral Trustee, as Mortgagee,
encumbering that certain Hamilton Reserve.

 

36. Deed of Trust, Assignment of Rents and Leases, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in Buchanan County, Virginia, by RESERVE COAL PROPERTIES COMPANY,
CONSOLIDATION COAL COMPANY, and CNX Gas Company LLC, collectively, as Grantor,
to BI Mortgage Trustee LLC, as Trustee, for the benefit of David A. Vanaskey,
Collateral Trustee, as Beneficiary, encumbering that certain Hurricane Branch
Reserve.

 

37. Deed of Trust, Assignment of Rents and Leases, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in Russell County, Virginia, by RESERVE COAL PROPERTIES COMPANY,
CONSOLIDATION COAL COMPANY, and CNX Gas Company LLC, collectively, as Grantor,
to BI Mortgage Trustee LLC, as Trustee, for the benefit of David A. Vanaskey,
Collateral Trustee, as Beneficiary, encumbering that certain Hurricane Branch
Reserve.

 

38. Deed of Trust, Assignment of Rents and Leases, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in Tazewell County, Virginia, by RESERVE COAL PROPERTIES COMPANY,
CONSOLIDATION COAL COMPANY, and CNX Gas Company LLC, collectively, as Grantor,
to BI Mortgage Trustee LLC, as Trustee, for the benefit of David A. Vanaskey,
Collateral Trustee, as Beneficiary, encumbering that certain Hurricane Branch
Reserve.

 

39. Mortgage, Assignment of Rents and Leases, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in Breathitt County, Kentucky, by CONSOL of Kentucky, as Mortgagor,
to David A. Vanaskey, Collateral Trustee, as Mortgagee, encumbering that certain
Jones Fork Mine.

 

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40. Mortgage, Assignment of Rents and Leases, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in Floyd County, Kentucky, by CONSOL of Kentucky, as Mortgagor, to
David A. Vanaskey, Collateral Trustee, as Mortgagee, encumbering that certain
Jones Fork Mine.

 

41. Mortgage, Assignment of Rents and Leases, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in Knott County, Kentucky, by CONSOL of Kentucky, as Mortgagor, to
David A. Vanaskey, Collateral Trustee, as Mortgagee, encumbering that certain
Jones Fork Mine.

 

42. Mortgage, Assignment of Rents and Leases, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in Magoffin County, Kentucky, by CONSOL of Kentucky, as Mortgagor,
to David A. Vanaskey, Collateral Trustee, as Mortgagee, encumbering that certain
Jones Fork Mine.

 

43. Credit Line Deed of Trust, Assignment of Rents and Leases, Security
Agreement, Financing Statement and Fixture Filing executed on June 14, 2004,
effective June 30, 2004, and recorded in Marion County, West Virginia, by
CONSOLIDATION COAL COMPANY, RESERVE COAL PROPERTIES COMPANY, and CNX Gas Company
LLC, collectively, as Grantor, to James A. Russell, as Trustee, for the benefit
of David A. Vanaskey, Collateral Trustee, as Beneficiary, encumbering that
certain Loveridge Mine.

 

44. Credit Line Deed of Trust, Assignment of Rents and Leases, Security
Agreement, Financing Statement and Fixture Filing executed on June 14, 2004,
effective June 30, 2004, and recorded in Monongalia County, West Virginia, by
CONSOLIDATION COAL COMPANY, RESERVE COAL PROPERTIES COMPANY, and CNX Gas Company
LLC, collectively, as Grantor, to James A. Russell, as Trustee, for the benefit
of David A. Vanaskey, Collateral Trustee, as Beneficiary, encumbering that
certain Loveridge Mine.

 

45. Credit Line Deed of Trust, Assignment of Rents and Leases, Security
Agreement, Financing Statement and Fixture Filing executed on June 14, 2004,
effective June 30, 2004, and recorded in Wetzel County, West Virginia, by
CONSOLIDATION COAL COMPANY, RESERVE COAL PROPERTIES COMPANY, and CNX Gas Company
LLC, collectively, as Grantor, to James A. Russell, as Trustee, for the benefit
of David A. Vanaskey, Collateral Trustee, as Beneficiary, encumbering that
certain Loveridge Mine.

 

46. Open-End Mortgage, Assignment of Rents and Leases, Security Agreement,
Financing Statement and Fixture Filing executed on June 14, 2004, effective June
30, 2004, and recorded in Harrison County, Ohio, by CONSOLIDATION COAL COMPANY,
as Mortgagor, to David A. Vanaskey, Collateral Trustee, as Mortgagee,
encumbering that certain Mahoning Valley Mine.

 

47. Open-End Mortgage, Assignment of Rents and Leases, Security Agreement,
Financing Statement and Fixture Filing executed on June 14, 2004, effective June
30, 2004, and recorded in Belmont County, Ohio, by CONSOLIDATION COAL COMPANY,
as Mortgagor, to David A. Vanaskey, Collateral Trustee, as Mortgagee,
encumbering that certain Mahoning Valley Mine.

 

--------------------------------------------------------------------------------

48. Credit Line Deed of Trust, Assignment of Rents and Leases, Security
Agreement, Financing Statement and Fixture Filing executed on June 14, 2004,
effective June 30, 2004, and recorded in Marshall County, West Virginia, by
CONSOLIDATION COAL COMPANY, CONSOL Pennsylvania Coal Company, and CNX Gas
Company LLC, collectively, as Grantor, to James A. Russell, as Trustee, for the
benefit of David A. Vanaskey, Collateral Trustee, as Beneficiary, encumbering
that certain Marshall County Reserve.

 

49. Credit Line Deed of Trust, Assignment of Rents and Leases, Security
Agreement, Financing Statement and Fixture Filing executed on June 14, 2004,
effective June 30, 2004, and recorded in Marshall County, West Virginia, by
CONSOLIDATION COAL COMPANY, McELROY COAL COMPANY, and CNX Gas Company LLC,
collectively, as Grantor, to James A. Russell, as Trustee, for the benefit of
David A. Vanaskey, Collateral Trustee, as Beneficiary, encumbering that certain
McElroy Mine.

 

50. Mortgage, Assignment of Rents and Leases, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in Knott County, Kentucky, by CONSOL of Kentucky, as Mortgagor, to
David A. Vanaskey, Collateral Trustee, as Mortgagee, encumbering that certain
Mill Creek Mine.

 

51. Mortgage, Assignment of Rents and Leases, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in Letcher County, Kentucky, by CONSOL of Kentucky, as Mortgagor,
to David A. Vanaskey, Collateral Trustee, as Mortgagee, encumbering that certain
Mill Creek Mine.

 

52. Mortgage, Assignment of Rents and Leases, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in Pike County, Kentucky, by CONSOL of Kentucky, as Mortgagor, to
David A. Vanaskey, Collateral Trustee, as Mortgagee, encumbering that certain
Mill Creek Mine.

 

53. Credit Line Deed of Trust, Assignment of Rents and Leases, Security
Agreement, Financing Statement and Fixture Filing executed on June 14, 2004,
effective June 30, 2004, and recorded in Marion County, West Virginia, by
CONSOLIDATION COAL COMPANY, and CNX Gas Company LLC, collectively, as Grantor,
to James A. Russell, as Trustee, for the benefit of David A. Vanaskey,
Collateral Trustee, as Beneficiary, encumbering that certain Nailer Reserve.

 

54. Mortgage, Assignment of Rents and Leases, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in Powder River County, Montana, by CONSOLIDATION COAL COMPANY and
RESERVE COAL PROPERTIES COMPANY, collectively, as Mortgagor, to David A.
Vanaskey, Collateral Trustee, as Mortgagee, encumbering that certain Otter Creek
Reserve.

 

55. Mortgage, Assignment of Rents and Leases, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in Jefferson County, Illinois, by CONSOLIDATION COAL COMPANY, as
Mortgagor, to David A. Vanaskey, Collateral Trustee, as Mortgagee, encumbering
that certain Rend Lake Mine.

 

--------------------------------------------------------------------------------

56. Credit Line Deed of Trust, Assignment of Rents and Leases, Security
Agreement, Financing Statement and Fixture Filing executed on June 14, 2004,
effective June 30, 2004, and recorded in Marion County, West Virginia, by
CONSOLIDATION COAL COMPANY, RESERVE COAL PROPERTIES COMPANY, and CNX Gas Company
LLC, collectively, as Grantor, to James A. Russell, as Trustee, for the benefit
of David A. Vanaskey, Collateral Trustee, as Beneficiary, encumbering that
certain Robinson Run Mine.

 

57. Credit Line Deed of Trust, Assignment of Rents and Leases, Security
Agreement, Financing Statement and Fixture Filing executed on June 14, 2004,
effective June 30, 2004, and recorded in Harrison County, West Virginia, by
CONSOLIDATION COAL COMPANY, RESERVE COAL PROPERTIES COMPANY, and CNX Gas Company
LLC, collectively, as Grantor, to James A. Russell, as Trustee, for the benefit
of David A. Vanaskey, Collateral Trustee, as Beneficiary, encumbering that
certain Robinson Run Mine.

 

58. Credit Line Deed of Trust, Assignment of Rents and Leases, Security
Agreement, Financing Statement and Fixture Filing executed on June 14, 2004,
effective June 30, 2004, and recorded in Wetzel County, West Virginia, by
CONSOLIDATION COAL COMPANY, RESERVE COAL PROPERTIES COMPANY, and CNX Gas Company
LLC, collectively, as Grantor, to James A. Russell, as Trustee, for the benefit
of David A. Vanaskey, Collateral Trustee, as Beneficiary, encumbering that
certain Robinson Run Mine.

 

59. Credit Line Deed of Trust, Assignment of Rents and Leases, Security
Agreement, Financing Statement and Fixture Filing executed on June 14, 2004,
effective June 30, 2004, and recorded in Monongalia County, West Virginia, by
CONSOLIDATION COAL COMPANY, RESERVE COAL PROPERTIES COMPANY, and CNX Gas Company
LLC, collectively, as Grantor, to James A. Russell, as Trustee, for the benefit
of David A. Vanaskey, Collateral Trustee, as Beneficiary, encumbering that
certain St. Cloud Reserve.

 

60. Credit Line Deed of Trust, Assignment of Rents and Leases, Security
Agreement, Financing Statement and Fixture Filing executed on June 14, 2004,
effective June 30, 2004, and recorded in Wetzel County, West Virginia, by
CONSOLIDATION COAL COMPANY, RESERVE COAL PROPERTIES COMPANY, and CNX Gas Company
LLC, collectively, as Grantor, to James A. Russell, as Trustee, for the benefit
of David A. Vanaskey, Collateral Trustee, as Beneficiary, encumbering that
certain St. Cloud Reserve.

 

61. Credit Line Deed of Trust, Assignment of Rents and Leases, Security
Agreement, Financing Statement and Fixture Filing executed on June 14, 2004,
effective June 30, 2004, and recorded in Marion County, West Virginia, by
CONSOLIDATION COAL COMPANY, as Grantor, to James A. Russell, as Trustee, for the
benefit of David A. Vanaskey, Collateral Trustee, as Beneficiary, encumbering
that certain St. Leo Reserve.

 

62. Credit Line Deed of Trust, Assignment of Rents and Leases, Security
Agreement, Financing Statement and Fixture Filing executed on June 14, 2004,
effective June 30, 2004, and recorded in Monongalia County, West Virginia, by
CONSOLIDATION COAL COMPANY, as Grantor, to James A. Russell, as Trustee, for the
benefit of David A. Vanaskey, Collateral Trustee, as Beneficiary, encumbering
that certain St. Leo Reserve.

 

--------------------------------------------------------------------------------

63. That certain Credit Line Deed of Trust, Assignment of Rents and Leases,
Security Agreement, Financing Statement and Fixture Filing executed on June 14,
2004, effective June 30, 2004, and recorded in Wetzel County, West Virginia, by
CONSOLIDATION COAL COMPANY, as Grantor, to James A. Russell, as Trustee, for the
benefit of David A. Vanaskey, Collateral Trustee, as Beneficiary, encumbering
that certain St. Leo Reserve.

 

64. Open-End Mortgage, Assignment of Rents and Leases, Security Agreement,
Financing Statement and Fixture Filing executed on June 14, 2004, effective June
30, 2004, and recorded in Allegheny County, Pennsylvania, by RESERVE COAL
PROPERTIES COMPANY, as Mortgagor, to David A. Vanaskey, Collateral Trustee, as
Mortgagee, encumbering that certain Shaner Reserve.

 

65. Open-End Mortgage, Assignment of Rents and Leases, Security Agreement,
Financing Statement and Fixture Filing executed on June 14, 2004, effective June
30, 2004, and recorded in Westmoreland County, Pennsylvania, by RESERVE COAL
PROPERTIES COMPANY, as Mortgagor, to David A. Vanaskey, Collateral Trustee, as
Mortgagee, encumbering that certain Shaner Reserve.

 

66. Credit Line Deed of Trust, Assignment of Rents and Leases, Security
Agreement, Financing Statement and Fixture Filing executed on June 14, 2004,
effective June 30, 2004, and recorded in Marshall County, West Virginia, by
CONSOLIDATION COAL COMPANY, and CNX Gas Company LLC, collectively, as Grantor,
to James A. Russell, as Trustee, for the benefit of David A. Vanaskey,
Collateral Trustee, as Beneficiary, encumbering that certain Shoemaker Mine.

 

67. Credit Line Deed of Trust, Assignment of Rents and Leases, Security
Agreement, Financing Statement and Fixture Filing executed on June 14, 2004,
effective June 30, 2004, and recorded in Ohio County, West Virginia, by
CONSOLIDATION COAL COMPANY, and CNX Gas Company LLC, collectively, as Grantor,
to James A. Russell, as Trustee, for the benefit of David A. Vanaskey,
Collateral Trustee, as Beneficiary, encumbering that certain Shoemaker Mine.

 

68. Open-End Mortgage, Assignment of Rents and Leases, Security Agreement,
Financing Statement and Fixture Filing executed on June 14, 2004, effective June
30, 2004, and recorded in Washington County, Pennsylvania, by CONSOLIDATION COAL
COMPANY, and CNX Gas Company LLC, collectively, as Mortgagor, to David A.
Vanaskey, Collateral Trustee, as Mortgagee, encumbering that certain Shoemaker
Mine.

 

69. Credit Line Deed of Trust, Assignment of Rents and Leases, Security
Agreement, Financing Statement and Fixture Filing executed on June 14, 2004,
effective June 30, 2004, and recorded in Doddridge County, West Virginia, by
CONSOLIDATION COAL COMPANY, RESERVE COAL PROPERTIES COMPANY, and CNX Gas Company
LLC, collectively, as Grantor, to James A. Russell, as Trustee, for the benefit
of David A. Vanaskey, Collateral Trustee, as Beneficiary, encumbering that
certain Tetrick Reserve.

 

70. Credit Line Deed of Trust, Assignment of Rents and Leases, Security
Agreement, Financing Statement and Fixture Filing executed on June 14, 2004,
effective June 30, 2004, and

 

--------------------------------------------------------------------------------

recorded in Harrison County, West Virginia, by CONSOLIDATION COAL COMPANY,
RESERVE COAL PROPERTIES COMPANY, and CNX Gas Company LLC, collectively, as
Grantor, to James A. Russell, as Trustee, for the benefit of David A. Vanaskey,
Collateral Trustee, as Beneficiary, encumbering that certain Tetrick Reserve.

 

71. Credit Line Deed of Trust, Assignment of Rents and Leases, Security
Agreement, Financing Statement and Fixture Filing executed on June 14, 2004,
effective June 30, 2004, and recorded in Marion County, West Virginia, by
CONSOLIDATION COAL COMPANY, RESERVE COAL PROPERTIES COMPANY, and CNX Gas Company
LLC, collectively, as Grantor, to James A. Russell, as Trustee, for the benefit
of David A. Vanaskey, Collateral Trustee, as Beneficiary, encumbering that
certain Tetrick Reserve.

 

72. Deed of Trust, Assignment of Rents and Leases, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in Buchanan County, Virginia, by ISLAND CREEK COAL COMPANY, as
Grantor, to BI Mortgage Trustee LLC, as Trustee, for the benefit of David A.
Vanaskey, Collateral Trustee, as Beneficiary, encumbering that certain VP3 Mine.

 

73. Deed of Trust, Assignment of Rents and Leases, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in Buchanan County, Virginia, by ISLAND CREEK COAL COMPANY, as
Grantor, to BI Mortgage Trustee LLC, as Trustee, for the benefit of David A.
Vanaskey, Collateral Trustee, as Beneficiary, encumbering that certain VP8 Mine.

 

74. Mortgage, Assignment of Rents and Leases, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in Sheridan County, Wyoming, by RESERVE COAL PROPERTIES COMPANY, as
Mortgagor, to David A. Vanaskey, Collateral Trustee, as Mortgagee, encumbering
that certain Youngs Creek Reserve.

 

75. Deed of Trust, Assignment of Production, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in Tazewell County, Virginia, by CNX Gas Company LLC and Cardinal
States Gathering Company, collectively, as Grantor, to BI Mortgage Trustee LLC,
as Trustee, for the benefit of David A. Vanaskey, Collateral Trustee, as
Beneficiary, encumbering those certain Tazewell Gas Well Heads, Leases, and
Pipelines.

 

76. Deed of Trust, Assignment of Production, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in Buchanan County, Virginia, by CNX Gas Company LLC and Cardinal
States Gathering Company, collectively, as Grantor, to BI Mortgage Trustee LLC,
as Trustee, for the benefit of David A. Vanaskey, Collateral Trustee, as
Beneficiary, encumbering those certain Buchanan Gas Well Heads, Gas Reserves,
and Gas Pipelines.

 

77. Deed of Trust, Assignment of Production, Security Agreement, Financing
Statement and Fixture Filing executed on June 14, 2004, effective June 30, 2004,
and recorded in Russell County, Virginia, by CNX Gas Company LLC, as Grantor, to
BI Mortgage Trustee LLC,

 

--------------------------------------------------------------------------------

as Trustee, for the benefit of David A. Vanaskey, Collateral Trustee, as
Beneficiary, encumbering those certain Russell Gas Well Heads and Gas Reserves.

 

78. Credit Line Deed of Trust, Assignment of Production, Security Agreement,
Financing Statement and Fixture Filing executed on June 14, 2004, effective June
30, 2004, and recorded in McDowell County, West Virginia, by CNX Gas Company
LLC, and Cardinal States Gathering Company, collectively, as Grantor, to James
A. Russell, as Trustee, for the benefit of David A. Vanaskey, Collateral
Trustee, as Beneficiary, encumbering those certain McDowell County Gas
Wellheads, Gas Reserves, and Gas Pipelines.

 

79. Credit Line Deed of Trust, Assignment of Production, Security Agreement,
Financing Statement and Fixture Filing executed on June 14, 2004, effective June
30, 2004, and recorded in Wyoming County, West Virginia, by Cardinal States
Gathering Company, collectively, as Grantor, to James A. Russell, as Trustee,
for the benefit of David A. Vanaskey, Collateral Trustee, as Beneficiary,
encumbering those certain Wyoming County Gas Pipelines.

 

80. Credit Line Deed of Trust, Assignment of Production, Security Agreement,
Financing Statement and Fixture Filing executed on June 14, 2004, effective June
30, 2004, and recorded in Mingo County, West Virginia, by Cardinal States
Gathering Company, collectively, as Grantor, to James A. Russell, as Trustee,
for the benefit of David A. Vanaskey, Collateral Trustee, as Beneficiary,
encumbering those certain Mingo County Gas Pipelines.

 

81. Mortgage, Assignment of Production, Security Agreement, Financing Statement
and Fixture Filing executed on June 14, 2004, effective June 30, 2004, and
recorded in Pike County, Pennsylvania, by Cardinal States Gathering Company, as
Mortgagor, to David A. Vanaskey, Collateral Trustee, as Mortgagee, encumbering
those certain Pike Gas Pipelines.

 

82. Indemnity Deed of Trust, Security Agreement, Assignment of Rents and Leases,
Financing Statement and Fixture Filing executed on June 14, 2004, effective June
30, 2004, and recorded in the City of Baltimore, Maryland, by CNX Marine
Terminals Inc., as Grantor, to Glenn P. Hare, as Trustee, for the benefit of
David A. Vanaskey, Collateral Trustee, as Beneficiary, encumbering that certain
Baltimore Dock Facility.

 

83. Promissory Note dated March 31, 1995 in the original principal amount of
CAD$10,000,000 executed by CONSOL of Canada Inc. in favor of CONSOL Energy Inc.

 

84. Promissory Note dated March 29, 1996 in the original principal amount of
$22,000,000 executed by Nineveh Coal Company in favor of CONSOL Energy Inc.

 

85. Promissory Note dated March 29, 1996 in the original principal amount of
$56,500,000 executed by CONSOLIDATION COAL COMPANY in favor of CONSOL Energy
Inc.

 

86. Promissory Note dated June 28, 1996 in the original principal amount of
$62,917,000 executed by CONSOLIDATION COAL COMPANY in favor of CONSOL Energy
Inc.

 

--------------------------------------------------------------------------------

87. Promissory Note dated September 13, 1996 in the original principal amount of
$4,497,000 executed by CONSOLIDATION COAL COMPANY in favor of CONSOL Energy Inc.

 

88. Promissory Note dated December 16, 1996 in the original principal amount of
$17,050,000 executed by CONSOLIDATION COAL COMPANY in favor of CONSOL Energy
Inc.

 

89. Promissory Note dated December 15, 1997 in the original principal amount of
$29,296,000 executed by CONSOLIDATION COAL COMPANY in favor of CONSOL Energy
Inc.

 

90. Promissory Note dated March 31, 1998 in the original principal amount of
$1,447,000 executed by Nineveh Coal Company in favor of CONSOL Energy Inc.

 

91. Promissory Note dated June 30, 1998 in the original principal amount of
$17,924,000 executed by Nineveh Coal Company in favor of CONSOL Energy Inc.

 

92. Promissory Note dated September 15, 1998 in the original principal amount of
$8,465,000 executed by Nineveh Coal Company in favor of CONSOL Energy Inc.

 

93. Promissory Note dated December 28, 1998 in the original principal amount of
$51,306,000 executed by CONSOLIDATION COAL COMPANY in favor of CONSOL Energy
Inc.

 

94. Promissory Note dated December 28, 1998 in the original principal amount of
$24,728,000 executed by Nineveh Coal Company in favor of CONSOL Energy Inc.

 

95. Promissory Note dated March 31, 1999 in the original principal amount of
$1,345,000 executed by Nineveh Coal Company in favor of CONSOL Energy Inc.

 

96. Promissory Note dated June 30, 1999 in the original principal amount of
$14,800,000 executed by Nineveh Coal Company in favor of CONSOL Energy Inc.

 

97. Promissory Note dated June 30, 1999 in the original principal amount of
$6,700,000 executed by CONSOLIDATION COAL COMPANY in favor of CONSOL Energy Inc.

 

98. Promissory Note dated September 15, 1999 in the original principal amount of
$6,185,000 executed by CONSOLIDATION COAL COMPANY in favor of CONSOL Energy Inc.

 

99. Promissory Note dated December 30, 1999 in the original principal amount of
$92,325,000 executed by CONSOLIDATION COAL COMPANY in favor of CONSOL Energy
Inc.

 

100. Promissory Note dated December 27, 2000 in the original principal amount of
CAD$100,000,000 executed by CONSOL Energy Canada Ltd. in favor of CONSOL Energy
Inc.

 

--------------------------------------------------------------------------------

101. Promissory Note dated April 26, 2002 in the original principal amount of
$350,000 executed by Universal Aggregates, LLC in favor of CONSOL Energy Inc.

 

102. Promissory Note dated July 1, 2002 in the original principal amount of
$100,000 executed by Universal Aggregates, LLC in favor of CONSOL Energy Inc.

 

103. Promissory Note dated August 22, 2002 in the original principal amount of
$100,000 executed by Universal Aggregates, LLC in favor of CONSOL Energy Inc.

 

104. Promissory Note dated October 23, 2002 in the original principal amount of
$100,000 executed by Universal Aggregates, LLC in favor of CONSOL Energy Inc.

 

105. Promissory Note dated January 2, 2003 in the original principal amount of
$100,000 executed by Universal Aggregates, LLC in favor of CONSOL Energy Inc.

 

106. Promissory Note dated March 3, 2003 in the original principal amount of
$100,000 executed by Universal Aggregates, LLC in favor of CONSOL Energy Inc.

 

107. Promissory Note dated April 7, 2003 in the original principal amount of
$200,000 executed by Universal Aggregates, LLC in favor of CONSOL Energy Inc.

 

108. Promissory Note dated May 27, 2003 in the original principal amount of
$200,000 executed by Universal Aggregates, LLC in favor of CONSOL Energy Inc.

 

109. Promissory Note dated July 17, 2003 in the original principal amount of
$100,000 executed by Universal Aggregates, LLC in favor of CONSOL Energy Inc.

 

110. Promissory Note dated August 7, 2003 in the original principal amount of
$100,000 executed by Universal Aggregates, LLC in favor of CONSOL Energy Inc.

 

111. Promissory Note dated August 28, 2003 in the original principal amount of
$100,000 executed by Universal Aggregates, LLC in favor of CONSOL Energy Inc.

 

112. Promissory Note dated April 30, 1999 in the original principal amount of
$9,677,583.29 executed by CONSOLIDATION COAL COMPANY in favor Church Street
Holdings, Inc.

 

113. Promissory Note dated August 6, 1999 in the original principal amount of
$48,120,000 executed by CONSOLIDATION COAL COMPANY in favor Church Street
Holdings, Inc.

 

114. Promissory Note dated October 15, 1999 in the original principal amount of
$32,250,000 executed by CONSOLIDATION COAL COMPANY in favor Church Street
Holdings, Inc.

 

115. Promissory Note dated December 30, 1999 in the original principal amount of
$2,500,000 executed by CONSOLIDATION COAL COMPANY in favor Church Street
Holdings, Inc.

 

--------------------------------------------------------------------------------

116. Promissory Note dated June 30, 2000 in the original principal amount of
$3,740,000 executed by CONSOLIDATION COAL COMPANY in favor Church Street
Holdings, Inc.

 

117. Promissory Note dated December 29, 2000 in the original principal amount of
$3,935,000 executed by CONSOLIDATION COAL COMPANY in favor Church Street
Holdings, Inc.

 

118. Promissory Note dated June 29, 2001 in the original principal amount of
$4,023,000 executed by CONSOLIDATION COAL COMPANY in favor Church Street
Holdings, Inc.

 

119. Promissory Note dated February 8, 2002 in the original principal amount of
$4,245,000 executed by CONSOLIDATION COAL COMPANY in favor Church Street
Holdings, Inc.

 

120. Promissory Note dated July 31, 2002 in the original principal amount of
$4,295,000 executed by CONSOLIDATION COAL COMPANY in favor Church Street
Holdings, Inc.

 

121. Promissory Note dated December 31, 2002 in the original principal amount of
$4,530,000 executed by CONSOLIDATION COAL COMPANY in favor Church Street
Holdings, Inc.

 

122. Promissory Note dated June 30, 2003 in the original principal amount of
$4,625,000 executed by CONSOL Pennsylvania Coal Company in favor of Church
Street Holdings, Inc.

 

123. Promissory Note dated December 31, 2003 in the original principal amount of
$4,850,000 executed by CONSOLIDATION COAL COMPANY in favor Church Street
Holdings, Inc.

 

124. Promissory Note dated February 29, 2000 in the original principal amount of
$8,925,000 executed by CONSOLIDATION COAL COMPANY in favor CONSOL Financial Inc.

 

125. Promissory Note dated March 15, 2000 in the original principal amount of
$2,116,000 executed by CONSOLIDATION COAL COMPANY in favor CONSOL Financial Inc.

 

126. Promissory Note dated March 31, 2000 in the original principal amount of
$116,000 executed by CONSOLIDATION COAL COMPANY in favor CONSOL Financial Inc.

 

127. Promissory Note dated June 30, 2000 in the original principal amount of
$15,980,000 executed by CONSOLIDATION COAL COMPANY in favor CONSOL Financial
Inc.

 

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128. Promissory Note dated December 29, 2000 in the original principal amount of
$24,790,000 executed by CONSOLIDATION COAL COMPANY in favor CONSOL Financial
Inc.

 

129. Promissory Note dated March 15, 2001 in the original principal amount of
$3,117,000 executed by CONSOLIDATION COAL COMPANY in favor CONSOL Financial Inc.

 

130. Promissory Note dated March 30, 2001 in the original principal amount of
$1,300,000 executed by CONSOLIDATION COAL COMPANY in favor CONSOL Financial Inc.

 

131. Promissory Note dated June 29, 2001 in the original principal amount of
$35,490,000 executed by CONSOLIDATION COAL COMPANY in favor CONSOL Financial
Inc.

 

132. Promissory Note dated February 8, 2002 in the original principal amount of
$38,285,000 executed by CONSOLIDATION COAL COMPANY in favor CONSOL Financial
Inc.

 

133. Promissory Note dated March 28, 2002 in the original principal amount of
$605,000 executed by CONSOLIDATION COAL COMPANY in favor CONSOL Financial Inc.

 

134. Promissory Note dated July 31, 2002 in the original principal amount of
$27,490,000 executed by CONSOLIDATION COAL COMPANY in favor CONSOL Financial
Inc.

 

135. Promissory Note dated December 31, 2002 in the original principal amount of
$81,790,000 executed by CONSOLIDATION COAL COMPANY in favor CONSOL Financial
Inc.

 

136. Promissory Note dated June 30, 2003 in the original principal amount of
$37,675,000 executed by CONSOL Pennsylvania Coal Company in favor CONSOL
Financial Inc.

 

137. Promissory Note dated September 15, 2003 in the original principal amount
of $11,685,000 executed by CONSOLIDATION COAL COMPANY in favor CONSOL Financial
Inc.

 

138. Promissory Note dated December 31, 2003 in the original principal amount of
$113,475,000 executed by CONSOLIDATION COAL COMPANY in favor CONSOL Financial
Inc.

 

139. Promissory Note dated April 3, 2002 in the original principal amount of
$600,000 executed by JARISA, INC. and PAUL M. HOGG in favor of CONSOL of
Kentucky Inc.

 

--------------------------------------------------------------------------------

140. Promissory Note dated November 10, 2003 in the original principal amount of
$98,000 executed by STRAIGHT FORK MINING, INC. and Yvonne Yonts in favor of
CONSOL of Kentucky Inc.

 

141. Promissory Note dated January 23, 2004 in the original principal amount of
$100,000 executed by Abundance Coal Inc. in favor of CONSOL of Kentucky Inc.

 

142. Mortgage Note dated July 30, 2002 in the original principal amount of
$2,800,000 executed by OXFORD MINING COMPANY in favor of CONSOLIDATION COAL
COMPANY.

 

143. Promissory Note dated December 31, 2002 in the original principal amount of
$2,400,000 executed by SUSTAINABLE CONSERVATION, INC. in favor of CONSOLIDATION
COAL COMPANY.

 

144. Promissory Note dated March 31, 2003 in the original principal amount of
$150,000 executed by VICA COAL COMPANY, INC. and KENNETH D. COE in favor of
CONSOLIDATION COAL COMPANY.

 

145. Promissory Note dated May 7, 2003 in the original principal amount of
$276,000 executed by A & N COAL COMPANY, INC. and ALLEN WHITED in favor of
CONSOLIDATION COAL COMPANY.

 

146. Promissory Note dated October 2, 2003 in the original principal amount of
$400,000 executed by DOUBLE M MINING, L.L.C. and GLENNA MAE MULLINS in favor of
CONSOLIDATION COAL COMPANY.

 

147. Promissory Note dated January 27, 2004 in the original principal amount of
$50,000 executed by VICA COAL COMPANY, INC. and Wiley V. Cullop, Jr. in favor of
CONSOLIDATION COAL COMPANY.

 

148. Promissory Note dated August 6, 1999 in the original principal amount of
$109,055,000 executed by CONSOLIDATION COAL COMPANY in favor New Century
Holdings, Inc.

 

149. Promissory Note dated December 30, 1999 in the original principal amount of
$3,575,000 executed by CONSOLIDATION COAL COMPANY in favor New Century Holdings,
Inc.

 

150. Promissory Note dated June 30, 2000 in the original principal amount of
$4,578,000 executed by CONSOLIDATION COAL COMPANY in favor New Century Holdings,
Inc.

 

151. Promissory Note dated December 29, 2000 in the original principal amount of
$4,807,000 executed by CONSOLIDATION COAL COMPANY in favor New Century Holdings,
Inc.

 

--------------------------------------------------------------------------------

152. Promissory Note dated June 29, 2001 in the original principal amount of
$4,925,000 executed by CONSOLIDATION COAL COMPANY in favor New Century Holdings,
Inc.

 

153. Promissory Note dated February 8, 2002 in the original principal amount of
$5,195,000 executed by CONSOLIDATION COAL COMPANY in favor New Century Holdings,
Inc.

 

154. Promissory Note dated July 31, 2002 in the original principal amount of
$5,240,000 executed by CONSOLIDATION COAL COMPANY in favor New Century Holdings,
Inc.

 

155. Promissory Note dated December 31, 2002 in the original principal amount of
$5,550,000 executed by CONSOLIDATION COAL COMPANY in favor New Century Holdings,
Inc.

 

156. Promissory Note dated June 30, 2003 in the original principal amount of
$5,650,000 executed by CONSOL Pennsylvania Coal Company in favor New Century
Holdings, Inc.

 

157. Promissory Note dated December 31, 2003 in the original principal amount of
$5,935,000 executed by CONSOLIDATION COAL COMPANY in favor New Century Holdings,
Inc.

 

158. Promissory Note dated December 21, 2000 in the original principal amount of
$10,950,000 executed by SUGAR CAMP PROPERTIES in favor of DUPECH INC.

 

159. Promissory Note dated November 10, 2003 in the original principal amount of
$98,000 executed by STRAIGHT FORK MINING INC. in favor of CONSOL of Kentucky
Inc.

 

160. Promissory Note dated March 23, 2004 in the original principal amount of
$80,000 executed by Apollo Coal Company in favor of CONSOL of Kentucky Inc.

 

161. Promissory Note dated April 2, 2004 in the original principal amount of
$50,000 executed by Abundance Coal Inc. in favor of CONSOL of Kentucky Inc.

 

162. Promissory Note dated April 8, 2004 in the original principal amount of
$85,000 executed by Vision Coal Inc. in favor of CONSOL of Kentucky Inc.

 

163. Promissory Note dated April 22, 2004 in the original principal amount of
$250,000 executed by Leprechaun Coal Inc. in favor of CONSOL of Kentucky Inc.

 

164. Promissory Note dated November 14, 2001 in the original principal amount of
$179,583.32 executed by Hiope Mining, Inc. in favor of CONSOLIDATION COAL
COMPANY

 

165. Promissory Note dated June 21, 2004 in the original principal amount of
$100,000 executed by Double M Mining, LLC. in favor of CONSOLIDATION COAL
COMPANY

 

--------------------------------------------------------------------------------

166. Promissory Note dated June 16, 2004 in the original principal amount of
$289,000 executed by Noble Coal LLC in favor of CONSOL of Kentucky Inc.

 

167. Promissory Note dated June 17, 2004 in the original principal amount of
$150,000 executed by Clas Coal Co. Inc. in favor of CONSOL of Kentucky Inc.

 

168. Promissory Note dated August 15, 2003 in the original principal amount of
$50,000 executed by TAZEWELL MCDOWELL COAL INC. and ROBERT B. HURLEY in favor of
CONSOLIDATION COAL COMPANY; Equipment Lease Agreement between TAZEWELL MCDOWELL
COAL INC. and Joshua Fuel Inc.

 

--------------------------------------------------------------------------------

169. UCC FILINGS

 

(a) BLANKET COLLATERAL

 

DEBTOR NAME, TYPE OF ENTITY & STATE OF FORMATION

--------------------------------------------------------------------------------

  

JURISDICTION

--------------------------------------------------------------------------------

CONSOL Energy Inc.

(Delaware corporation)

   Delaware Secretary of State

Cardinal States Gathering Company

(Virginia general partnership)

   Virginia Secretary of State

Central Ohio Coal Company

(Ohio corporation)

   Ohio Secretary of State

Church Street Holdings, Inc.

(Delaware corporation)

   Delaware Secretary of State

CNX Gas Company LLC

(Virginia limited liability company)

   Virginia Secretary of State

CNX Land Resources Inc.

(Delaware corporation)

   Delaware Secretary of State

CNX Marine Terminals Inc.

(Delaware corporation)

   Delaware Secretary of State

Conrhein Coal Company

(Pennsylvania general partnership)

   Pennsylvania Secretary of State

Consol Docks Inc.

(Delaware corporation)

   Delaware Secretary of State

CONSOL Financial Inc.

(Delaware corporation)

   Delaware Secretary of State

CONSOL of Canada Inc.

(Delaware corporation)

   Delaware Secretary of State

 

--------------------------------------------------------------------------------

DEBTOR NAME, TYPE OF ENTITY & STATE OF FORMATION

--------------------------------------------------------------------------------

  

JURISDICTION

--------------------------------------------------------------------------------

CONSOL of Kentucky Inc.

(Delaware corporation)

   Delaware Secretary of State

CONSOL Pennsylvania Coal Company

(Delaware corporation)

   Delaware Secretary of State

Consol Sales Company

(Delaware corporation)

   Delaware Secretary of State

CONSOLIDATION COAL COMPANY

(Delaware corporation)

   Delaware Secretary of State

Eighty-Four Mining Company

(Pennsylvania corporation)

   Pennsylvania Secretary of State

Greene Energy LLC

(Pennsylvania limited liability company)

   Pennsylvania Secretary of State

Helvetia Coal Company

(Pennsylvania corporation)

   Pennsylvania Secretary of State

IC Coal, Inc.

(Delaware corporation)

   Delaware Secretary of State

ISLAND CREEK COAL COMPANY

(Delaware corporation)

   Delaware Secretary of State

Jeffco Coal Company

(Pennsylvania corporation)

   Pennsylvania Secretary of State

Keystone Coal Mining Corporation

(Pennsylvania corporation)

   Pennsylvania Secretary of State

Laurel Run Mining Company

(Virginia corporation)

   Virginia Secretary of State

Leatherwood, Inc.

(Pennsylvania corporation)

   Pennsylvania Secretary of State

 

--------------------------------------------------------------------------------

DEBTOR NAME, TYPE OF ENTITY & STATE OF FORMATION

--------------------------------------------------------------------------------

  

JURISDICTION

--------------------------------------------------------------------------------

McELROY COAL COMPANY

(Delaware corporation)

   Delaware Secretary of State

MTB Inc.

(Delaware corporation)

   Delaware Secretary of State

New Century Holdings, Inc.

(Delaware corporation)

   Delaware Secretary of State

QUARTO MINING COMPANY

(Ohio corporation)

   Ohio Secretary of State

RESERVE COAL PROPERTIES COMPANY

(Delaware corporation)

   Delaware Secretary of State

Rochester & Pittsburgh Coal Company

(Pennsylvania corporation)

   Pennsylvania Secretary of State

SOUTHERN OHIO COAL COMPANY

(West Virginia corporation)

   West Virginia Secretary of State

Terra Firma Company

(West Virginia corporation)

   West Virginia Secretary of State

THE WHITE STAR COAL CO., INC.

(New York corporation)

   New York Secretary of State

TWIN RIVERS TOWING COMPANY

(Delaware corporation)

   Delaware Secretary of State

UNITED EASTERN COAL SALES CORPORATION

(Pennsylvania corporation)

   Pennsylvania Secretary of State

Windsor Coal Company

(West Virginia corporation)

   West Virginia Secretary of State

WOLFPEN KNOB DEVELOPMENT COMPANY

(Virginia corporation)

   Virginia Secretary of State

 

--------------------------------------------------------------------------------

(b) FIXTURE FILINGS

 

DEBTOR NAME(S)

--------------------------------------------------------------------------------

  

JURISDICTION

--------------------------------------------------------------------------------

  

COAL MINE/COAL

RESERVE/TERMINAL/PORT

--------------------------------------------------------------------------------

CONSOL Pennsylvania Coal Company CONSOLIDATION COAL COMPANY RESERVE COAL
PROPERTIES COMPANY    Tazewell County, VA    Amonate Mine and Associated
Facilities CONSOL Pennsylvania Coal Company CONSOLIDATION COAL COMPANY RESERVE
COAL PROPERTIES COMPANY    McDowell County, WV    Amonate Mine and Associated
Facilities Conrhein Coal Company CONSOL Pennsylvania Coal Company CONSOLIDATION
COAL COMPANY RESERVE COAL PROPERTIES COMPANY    Greene County, PA    Bailey
Mine, Enlow Fork Mine, and Associated Facilities Conrhein Coal Company CONSOL
Pennsylvania Coal Company CONSOLIDATION COAL COMPANY RESERVE COAL PROPERTIES
COMPANY    Washington County, PA    Bailey Mine, Enlow Fork Mine, and Associated
Facilities Conrhein Coal Company CONSOL Pennsylvania Coal Company CONSOLIDATION
COAL COMPANY RESERVE COAL PROPERTIES COMPANY    Marshall County, WV    Bailey
Mine, Enlow Fork Mine, and Associated Facilities CNX Gas Company LLC
CONSOLIDATION COAL COMPANY    Greene County, PA    Blacksville #2 Mine and
Associated Facilities CNX Gas Company LLC CONSOLIDATION COAL COMPANY   
Monongalia County, WV    Blacksville #2 Mine and Associated Facilities RESERVE
COAL PROPERTIES COMPANY CONSOLIDATION COAL COMPANY CNX Gas Company LLC   
Buchanan County    Buchanan Mine and Associated Facilities

 

--------------------------------------------------------------------------------

DEBTOR NAME(S)

--------------------------------------------------------------------------------

  

JURISDICTION

--------------------------------------------------------------------------------

  

COAL MINE/COAL

RESERVE/TERMINAL/PORT

--------------------------------------------------------------------------------

Eighty-Four Mining Company ISLAND CREEK COAL COMPANY Laurel Run Mining Company
RESERVE COAL PROPERTIES COMPANY    Washington County, PA    Eighty-Four Mine and
Associated Facilities CONSOLIDATION COAL COMPANY    Emery County, UT    Emery
Mine and Associated Facilities CONSOL of Kentucky Inc.    Floyd County, KY   
Jones Fork Mine and Associated Facilities CONSOL of Kentucky Inc.    Knott
County, KY    Jones Fork Mine and Associated Facilities CONSOL of Kentucky Inc.
   Magoffin County, KY    Jones Fork Mine and Associated Facilities CNX Gas
Company LLC CONSOLIDATION COAL COMPANY RESERVE COAL PROPERTIES COMPANY    Marion
County, WV    Loveridge Mine and Associated Facilities CNX Gas Company LLC
CONSOLIDATION COAL COMPANY RESERVE COAL PROPERTIES COMPANY    Monongalia County
WV    Loveridge Mine and Associated Facilities CNX Gas Company LLC CONSOLIDATION
COAL COMPANY RESERVE COAL PROPERTIES COMPANY    Wetzel County, WV    Loveridge
Mine and Associated Facilities CONSOLIDATION COAL COMPANY    Belmont County, OH
   Mahoning Valley Mine and Associated Facilities CONSOLIDATION COAL COMPANY   
Harrison County, OH    Mahoning Valley Mine and Associated Facilities

 

--------------------------------------------------------------------------------

DEBTOR NAME(S)

--------------------------------------------------------------------------------

  

JURISDICTION

--------------------------------------------------------------------------------

  

COAL MINE/COAL

RESERVE/TERMINAL/PORT

--------------------------------------------------------------------------------

CNX Gas Company LLC CONSOLIDATION COAL COMPANY McELROY COAL COMPANY    Marshall
County, WV    McElroy Mine and Associated Facilities CONSOL of Kentucky Inc.   
Knott County, KY    Mill Creek Mine and Associated Facilities CONSOL of Kentucky
Inc.    Letcher County, KY    Mill Creek Mine and Associated Facilities CONSOL
of Kentucky Inc.    Pike County, KY    Mill Creek Mine and Associated Facilities
CONSOLIDATION COAL COMPANY    Jefferson County, IL    Rend Lake Mine and
Associated Facilities CNX Gas Company LLC CONSOLIDATION COAL COMPANY RESERVE
COAL PROPERTIES COMPANY    Harrison County WV    Robinson Run Mine and
Associated Facilities CNX Gas Company LLC CONSOLIDATION COAL COMPANY RESERVE
COAL PROPERTIES COMPANY    Marion County, WV    Robinson Run Mine and Associated
Facilities CNX Gas Company LLC CONSOLIDATION COAL COMPANY RESERVE COAL
PROPERTIES COMPANY    Wetzel County, WV    Robinson Run Mine and Associated
Facilities CNX Gas Company LLC CONSOLIDATION COAL COMPANY    Washington County,
PA    Shoemaker Mine and Associated Facilities CNX Gas Company LLC CONSOLIDATION
COAL COMPANY    Marshall County, WV    Shoemaker Mine and Associated Facilities
CNX Gas Company LLC CONSOLIDATION COAL COMPANY    Ohio County, WV    Shoemaker
Mine and Associated Facilities

 

--------------------------------------------------------------------------------

DEBTOR NAME(S)

--------------------------------------------------------------------------------

  

JURISDICTION

--------------------------------------------------------------------------------

  

COAL MINE/COAL

RESERVE/ TERMINAL/PORT

--------------------------------------------------------------------------------

ISLAND CREEK COAL COMPANY

  

Buchanan County, VA

  

VP3 Mine and Associated Facilities

ISLAND CREEK COAL COMPANY

  

Buchanan County, VA

  

VP8 Mine and Associated Facilities

Consol Docks Inc.

  

Fayette County, PA

  

Alicia Dock Facility

Cardinal States Gathering Company

  

Pike County, KY

  

Gas Pipeline

Cardinal States Gathering Company

  

Buchanan County VA

  

Gas Pipeline

Cardinal States Gathering Company

  

Russell County, VA

  

Gas Pipeline

Cardinal States Gathering Company

  

Tazewell County, VA

  

Gas Pipeline

Cardinal States Gathering Company

  

McDowell County, WV

  

Gas Pipeline

Cardinal States Gathering Company

  

Mingo County, WV

  

Gas Pipeline

Cardinal States Gathering Company

  

Wyoming County, WV

  

Gas Pipeline

CNX Marine Terminals Inc.

  

City of Baltimore, MD

  

Baltimore Terminal

CNX Gas Company LLC

  

Buchanan County, VA

  

Well Head

CNX Gas Company LLC

  

Russell County, VA

  

Well Head

CNX Gas Company LLC

  

Tazewell County, VA

  

Well Head

CNX Gas Company LLC

  

McDowell County, WV

  

Well Head

 

--------------------------------------------------------------------------------

(c) AS-EXTRACTED COLLATERAL FILINGS

 

DEBTOR NAME(S), TYPE OF ENTITY

& STATE OF FORMATION

--------------------------------------------------------------------------------

  

JURISDICTION

--------------------------------------------------------------------------------

  

MINE HEAD

--------------------------------------------------------------------------------

CONSOLIDATION COAL COMPANY

  

Tazewell County, VA

  

Amonate Mine

CONSOLIDATION COAL COMPANY

  

McDowell County, WV

  

Amonate Mine

Conrhein Coal Company

  

Greene County, PA

  

Bailey Mine, Enlow Fork Mine

Conrhein Coal Company

  

Washington County, PA

  

Bailey Mine, Enlow Fork Mine

CONSOLIDATION COAL COMPANY

  

Monongalia County, WV

  

Blacksville #2 Mine

CONSOLIDATION COAL COMPANY

  

Buchanan County, VA

  

Buchanan Mine

Eighty-Four Mining Company

  

Washington County, PA

  

Eighty-Four Mine

CONSOLIDATION COAL COMPANY

  

Emery County, UT

  

Emery Mine

CONSOL of Kentucky Inc.

  

Knott County, KY

  

Jones Fork Mine

CONSOLIDATION COAL COMPANY

  

Marion County, WV

  

Loveridge Mine

CONSOLIDATION COAL COMPANY

  

Belmont County, OH

  

Mahoning Valley Mine

CONSOLIDATION COAL COMPANY

  

Harrison County, OH

  

Mahoning Valley Mine

CONSOLIDATION COAL COMPANY

  

Marshall County, WV

  

McElroy Mine

CONSOL of Kentucky Inc.

  

Letcher County, KY

  

Mill Creek Mine

CONSOLIDATION COAL COMPANY

  

Jefferson County, IL

  

Rend Lake Mine

CONSOLIDATION COAL COMPANY

  

Harrison County WV

  

Robinson Run Mine

CONSOLIDATION COAL COMPANY

  

Marshall County, WV

  

Shoemaker Mine

ISLAND CREEK COAL COMPANY

  

Buchanan County, VA

  

VP3 Mine

 

--------------------------------------------------------------------------------

DEBTOR NAME(S), TYPE OF ENTITY

& STATE OF FORMATION

--------------------------------------------------------------------------------

  

JURISDICTION

--------------------------------------------------------------------------------

  

MINE HEAD

--------------------------------------------------------------------------------

ISLAND CREEK COAL COMPANY

  

Buchanan County, VA

  

VP8 Mine

CNX Gas Company LLC

  

Buchanan County, VA

  

Well Head

CNX Gas Company LLC

  

Russell County, VA

  

Well Head

CNX Gas Company LLC

  

Tazewell County, VA

  

Well Head

CNX Gas Company LLC

  

McDowell County, WV

  

Well Head

 

--------------------------------------------------------------------------------

170. CONSOL - LIST OF PLEDGED EQUITY

 

(a) CORPORATIONS

 

FULL LEGAL NAME OF

ENTITY (STATE OF
INCORPORATION)

--------------------------------------------------------------------------------

  

LEGAL NAME OF

ENTITY’S

SHAREHOLDER

--------------------------------------------------------------------------------

  

ENTITY’S

SHAREHOLDER AS

LISTED ON STOCK
CERTIFICATE(S)

--------------------------------------------------------------------------------

  

STOCK

CERTIFICATE NO.

(NUMBER OF

SHARES TO BE

PLEDGED)

--------------------------------------------------------------------------------

Central Ohio Coal

Company (Ohio corporation)

  

CONSOLIDATION

COAL COMPANY

   Consolidation Coal Company    No. 25 (75,000) Church Street Holdings, Inc.
(Delaware corporation)   

Rochester & Pittsburgh

Coal Company

   Rochester & Pittsburgh Coal Company    No. 5 (100 shares) CNX Land Resources
Inc. (Delaware corporation)   

CONSOL Energy

Inc.

   CONSOL Energy Inc.    No. 1 (1,000 shares) CNX Marine Terminals Inc.
(Delaware corporation)   

CONSOLIDATION

COAL COMPANY

   Consolidation Coal Company    No. 2 (1,000 shares)

Consol Docks Inc.

(Delaware corporation)

  

CONSOL Energy

Inc.

  

CONSOL INC. [merged into CONSOL Energy Inc.]

 

CONSOL Energy Inc.

  

No. 1 (510 shares)

 

No. 2A (490 shares)

CONSOL Financial Inc. (Delaware corporation)   

CONSOL Energy

Inc.

   CONSOL Energy Inc.    No. 1 (1,000 shares) CONSOL of Canada Inc. (Delaware
corporation)   

CONSOL Energy

Inc.

  

CONSOL Energy Inc.

 

CONSOL Inc. [merged into CONSOL Energy Inc.]

  

No. 9 (3,430 shares)

 

No. 8 (3,570 shares)

CONSOL of Kentucky Inc. (Delaware corporation)   

CONSOL Energy

Inc.

  

CONSOL Energy Inc.

 

CONSOL Inc. [merged into CONSOL Energy Inc.]

  

No. 7 (245 shares)

 

No. 6 (255 shares)

CONSOL Pennsylvania

Coal Company

(Delaware corporation)

  

CONSOL Energy

Inc.

  

CONSOL Energy Inc.

 

CONSOL Inc. [merged into CONSOL Energy Inc.]

  

No. 3A (490 shares)

 

No. 4 (510 shares)

 

--------------------------------------------------------------------------------

FULL LEGAL NAME OF

ENTITY (STATE OF
INCORPORATION)

--------------------------------------------------------------------------------

  

LEGAL NAME OF

ENTITY’S

SHAREHOLDER

--------------------------------------------------------------------------------

  

ENTITY’S

SHAREHOLDER AS

LISTED ON STOCK
CERTIFICATE(S)

--------------------------------------------------------------------------------

  

STOCK

CERTIFICATE NO.

(NUMBER OF

SHARES TO BE

PLEDGED)

--------------------------------------------------------------------------------

Consol Sales Company (Delaware corporation)    CONSOL Energy Inc.   

CONSOL Energy Inc.

 

Consol Inc. [merged into CONSOL Energy Inc.]

  

No. 1A (490 shares)

 

No. 3 (510 shares)

CONSOLIDATION COAL COMPANY

(Delaware corporation)

   CONSOL Energy Inc.   

CONSOL Energy Inc.

 

Consol Inc. [merged into CONSOL Energy Inc.]

  

No. 6A (36,750 shares)

 

No. 7 (38,250 shares)

Eighty-Four Mining Company (Pennsylvania corporation)    New Century Holdings,
Inc.    New Century Holdings, Inc.    No. 1A (10 shares) Helvetia Coal Company
(Pennsylvania corporation)    Rochester & Pittsburgh Coal Company    Rochester &
Pittsburgh Coal Company    No. 2 (500 shares) IC Coal, Inc. (Delaware
corporation)    CONSOL Energy Inc.    CONSOL Energy Inc.    No. 2 (1,000 shares)

ISLAND CREEK COAL COMPANY

(Delaware corporation)

   IC Coal, Inc.    IC Coal, Inc.    No. 7 (100 shares) Jeffco Coal Company
(Pennsylvania corporation)    Rochester & Pittsburgh Coal Company    ROCHESTER &
PITTSBURGH COAL COMPANY    No. 2 (500 shares)

Keystone Coal Mining Corporation

(Pennsylvania corporation)

   Rochester & Pittsburgh Coal Company    Rochester & Pittsburgh Coal Company   
No. 2 (100 shares) Laurel Run Mining Company (Virginia corporation)    ISLAND
CREEK COAL COMPANY    Island Creek Coal Company    No. 17 (1,000 shares)

 

--------------------------------------------------------------------------------

FULL LEGAL NAME OF

ENTITY (STATE OF
INCORPORATION)

--------------------------------------------------------------------------------

  

LEGAL NAME OF

ENTITY’S

SHAREHOLDER

--------------------------------------------------------------------------------

  

ENTITY’S

SHAREHOLDER AS

LISTED ON STOCK
CERTIFICATE(S)

--------------------------------------------------------------------------------

  

STOCK

CERTIFICATE NO.

(NUMBER OF

SHARES TO BE

PLEDGED)

--------------------------------------------------------------------------------

Leatherwood, Inc.

(Pennsylvania corporation)

   Rochester & Pittsburgh Coal Company    ROCHESTER & PITTSBURGH COAL COMPANY   
No. 1A (100 shares) McELROY COAL COMPANY (Delaware corporation)    CONSOLIDATION
COAL COMPANY    CONSOLIDATION COAL COMPANY    No. 1 (1,000 shares)

MTB Inc.

(Delaware corporation)

   CONSOL Energy Inc.   

CONSOL Energy Inc

 

CONSOL Inc. [merged into CONSOL Energy Inc.]

  

No. 1A (490 shares)

 

No. 2 (510 shares)

New Century Holdings, Inc. (Delaware corporation)    Rochester & Pittsburgh Coal
Company    Rochester & Pittsburgh Coal Company    No. 1 (100) QUARTO MINING
COMPANY (Ohio corporation)    CONSOLIDATION COAL COMPANY   

CONSOLIDATION COAL COMPANY

Consolidation Coal Company

  

No. 3 (245 shares)

 

No. 4 (255 shares)

RESERVE COAL PROPERTIES COMPANY
(Delaware corporation)    CONSOL Energy Inc.   

CONSOL Energy Inc.

 

CONSOL Inc. [merged into CONSOL Energy Inc.]

  

No. 4A (490 shares)

 

No. 5 (510 shares)

Rochester & Pittsburgh Coal Company

(Pennsylvania corporation)

   CONSOLIDATION COAL COMPANY    CONSOLIDATION COAL COMPANY    No. 2 (1,000
shares)

SOUTHERN OHIO COAL COMPANY

(West Virginia corporation)

   CONSOLIDATION COAL COMPANY    Consolidation Coal Company    No. 10 (5,000
shares)

Terra Firma Company

(West Virginia corporation)

   CNX Land Resources Inc.    CNX Land Resources Inc.    No 1 (1 share)

 

--------------------------------------------------------------------------------

FULL LEGAL NAME OF

ENTITY (STATE OF
INCORPORATION)

--------------------------------------------------------------------------------

  

LEGAL NAME OF

ENTITY’S

SHAREHOLDER

--------------------------------------------------------------------------------

  

ENTITY’S

SHAREHOLDER AS

LISTED ON STOCK
CERTIFICATE(S)

--------------------------------------------------------------------------------

  

STOCK

CERTIFICATE NO.

(NUMBER OF

SHARES TO BE

PLEDGED)

--------------------------------------------------------------------------------

THE WHITE STAR COAL
CO., INC.
(New York corporation)    UNITED EASTERN
COAL SALES CORPORATION    United Eastern Coal Sales Corporation    No. 2 (10
shares) TWIN RIVERS TOWING COMPANY
(Delaware corporation)    CONSOL Energy
Inc.   

CONSOL Energy Inc.

 

CONSOL Inc. [merged into CONSOL Energy
Inc.]

  

No. 3A (490 shares)

 

No. 4 (510 shares)

UNITED EASTERN COAL SALES CORPORATION
(Pennsylvania corporation)    Rochester &
Pittsburgh Coal
Company    Rochester & Pittsburgh
Coal Company (all
certificates)   

No. 18 (105 shares)

 

No. 20 (10 shares)

 

No. 21 (490 shares)

 

No. 22 (245 shares)

Windsor Coal Company
(West Virginia corporation)    CONSOLIDATION
COAL COMPANY    Consolidation Coal
Company    No. 29 (4,064 shares) WOLFPEN KNOB DEVELOPMENT COMPANY
(Virginia corporation)    CONSOL Energy Inc.   

CONSOL Energy Inc.

 

CONSOL Inc. [merged into CONSOL Energy Inc.]

  

No. 5B (490 shares)

 

No. 6 (510 shares)

 

--------------------------------------------------------------------------------

(b) FOREIGN CORPORATIONS OWNED BY A DOMESTIC LOAN PARTY

 

FULL LEGAL NAME OF

ENTITY (STATE OF
INCORPORATION)

--------------------------------------------------------------------------------

  

LEGAL NAME OF
ENTITY’S
SHAREHOLDER

--------------------------------------------------------------------------------

  

ENTITY’S
SHAREHOLDER AS
LISTED ON STOCK
CERTIFICATE(S)

--------------------------------------------------------------------------------

  

STOCK

CERTIFICATE NO.
(NUMBER OF
SHARES TO BE

PLEDGED)

--------------------------------------------------------------------------------

CONSOL Foreign Sales
Corporation    CONSOL Energy Inc.    CONSOL Energy Inc.    No. 2 (650 shares)
CONSOL Godefroid
Europe, S.A.   

CONSOLIDATION COAL COMPANY

 

CNX Marine Terminals Inc.

  

CONSOLIDATION
COAL COMPANY

 

CNX Marine Terminals Inc.

  

No. 4 (98 shares)

 

 

No. 6 (73,353 shares)

 

(c) LIMITED LIABILITY COMPANIES

 

FULL LEGAL NAME OF

ENTITY (STATE OF

FORMATION)

--------------------------------------------------------------------------------

  

ENTITY’S MEMBER(S)

--------------------------------------------------------------------------------

Buchanan Generation, LLC
(Virginia limited liability company)    CONSOL Energy Inc. (50%) Greene Energy
LLC
(Pennsylvania limited liability company)    CONSOLIDATION COAL COMPANY (99%)
CONSOL Energy Inc. (1%)

 

--------------------------------------------------------------------------------

EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

CREDIT LINE

DEED OF TRUST, ASSIGNMENT OF PRODUCTION,

SECURITY AGREEMENT, FINANCING STATEMENT AND FIXTURE FILING

(WEST VIRGINIA)

 

by and from

 

--------------------------------------------------------------------------------

 

“Grantor”

 

to

 

                    , as Trustee,

“Trustee”

 

in favor of

 

DAVID A. VANASKEY,

not in his individual capacity, but solely as Collateral Trustee, pursuant to
that certain Collateral Trust Agreement dated as of June     , 2004, for the
benefit of (i) the Collateral Trustees (as defined in such Collateral Trust
Agreement), (ii) the Lenders under the Credit Agreement, (iii) the holders of
the Senior Notes (1991) and the Senior Notes (2002), and (iv) any other Persons
from time to time holders of the Secured Debt (as all such terms are hereinafter
defined) “Beneficiary”

 

Dated June 14, 2004, effective June 30, 2004

 

Dated as of June 30, 2004

 

Location:

County:

State:

 

PRECISE ADDRESS OF BENEFICIARY IS:

David A. Vanaskey, as Collateral Trustee

c/o Wilmington Trust Company

Rodney Square North

1100 North Market Street

Wilmington, DE 19890

 

THIS IS A CREDIT LINE DEED OF TRUST UNDER WEST VIRGINIA CODE 38-1-14.

 

THIS DEED OF TRUST SECURES AN OBLIGATION THAT MAY INCREASE OR DECREASE FROM TIME
TO TIME.

 

A POWER OF SALE HAS BEEN GRANTED IN THIS DEED OF TRUST. A POWER OF SALE MAY
ALLOW THE BENEFICIARY TO TAKE THE DEED OF TRUST PROPERTY AND SELL IT WITHOUT
GOING TO COURT IN A FORECLOSURE ACTION UPON DEFAULT BY THE GRANTOR UNDER THIS
DEED OF TRUST.

 

THE GRANTOR HAS AN INTEREST OF RECORD IN THE REAL ESTATE CONCERNED, WHICH IS
DESCRIBED HEREIN.

 

NOTE TO CLERK: THIS DEED OF TRUST CONSTITUTES A FIXTURE FILING AND COVERS
AS-EXTRACTED COLLATERAL UNDER THE UCC (AS DEFINED HEREIN) AND IS TO BE
CROSS-REFERENCED IN THE UCC RECORDS.

 

THE SECURED PARTY (BENEFICIARY) DESIRES THIS FIXTURE FILING AND FINANCING
STATEMENT COVERING AS-EXTRACTED COLLATERAL TO BE INDEXED AGAINST THE RECORD
OWNER OF THE REAL ESTATE DESCRIBED HEREIN.

 

PREPARED BY, RECORDING REQUESTED BY,

AND WHEN RECORDED MAIL TO:

--------------------------------------------------------------------------------

EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

Buchanan Ingersoll PC

301 Grant Street, 20th Floor

One Oxford Centre

Pittsburgh, PA 15219-1410

Attention: Michael A. Donadee, Esq.

 

--------------------------------------------------------------------------------

EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

CREDIT LINE DEED OF TRUST, SECURITY AGREEMENT,

ASSIGNMENT OF PRODUCTION, FINANCING

STATEMENT AND FIXTURE FILING (WEST VIRGINIA)

 

THIS CREDIT LINE DEED OF TRUST, SECURITY AGREEMENT, ASSIGNMENT OF PRODUCTION,
FINANCING STATEMENT AND FIXTURE FILING (this “Deed of Trust”) is made and
executed the 14th day of June, 2004, to be delivered and effective June 30,
2004, and is made and delivered by                                        
                                                                  , whose
address is c/o Consol Energy, Inc., CONSOL Plaza, 1800 Washington Road,
Pittsburgh, Pennsylvania 15241 (“Grantor”), to
                                         , having an address of
                                                                         
(“Trustee”), in favor of DAVID A. VANASKEY, as Collateral Trustee pursuant to
that certain Collateral Trust Agreement dated as of June 30, 2004, for the
benefit of (i) the Collateral Trustees, (ii) the Lenders under the Credit
Agreement, (iii) the holders of the Senior Notes (1991) and the Senior Notes
(2002), and (iv) any other Persons from time to time holders of the Secured Debt
(in such capacity, together with any successor or assign, “Collateral Trustee”),
having an address c/o Wilmington Trust Company, 1100 North Market Street, Rodney
Square North, Wilmington, DE 19890 (Collateral Trustee, together with its
successors and assigns, “Beneficiary”).

 

Credit Line Deed of Trust

 

This Deed of Trust is a Credit Line Deed of Trust under West Virginia Code §
38-1-14. It secures the Secured Debt (as hereinafter defined) up to a maximum
principal indebtedness of One Billion Dollars ($1,000,000,000). Future advances
of these sums are, subject to the terms of the documents evidencing the Secured
Debt, and this Deed of Trust, authorized and intended to be obligatory. In
addition, this Deed of Trust also secures interest accrued on all such sums at
the rate or rates set forth in the Security Documents, together with all sums
advanced by Beneficiary for taxes or insurance premiums, to protect the
Mortgaged Property or the lien of this Deed of Trust or for expenses or legal
fees incurred by Trustee or Beneficiary arising out of a default by Grantor
hereunder or under the Security Documents, or for any other Obligations under
the Credit Agreement, which sums may exceed the sum set forth above.

 

Notices to Beneficiary shall be delivered to:

 

David A. Vanaskey, as Collateral Trustee

c/o Wilmington Trust Company

Rodney Square North

1100 North Market Street

Wilmington, DE 19890

Phone: (302) 636-6019

Telecopy: (302) 636-4143

 

ARTICLE 1

DEFINITIONS

 

Section 1.1 Use of Capitalized Terms. All capitalized terms used herein without
definition shall have the respective meanings ascribed to them in the Credit
Agreement.

 

S-1

--------------------------------------------------------------------------------

EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

Section 1.2 Definitions. The following terms used in this Deed of Trust shall
have the meanings set forth:

 

(a) “Actionable Default”: means (i) an “Event of Default” under and as defined
by the Credit Agreement; (ii) an event of default under the Public Indenture; or
(iii) an event of default under the Issuing and Paying Agency Agreement, or (iv)
a default under the terms of the Collateral Trust Agreement.

 

(b) “Bank” shall mean PNC Bank, National Association, in its individual
capacity.

 

(c) “Borrower”: shall mean Consol Energy Inc., a Delaware corporation.

 

(d) “Collateral Trust Agreement”: shall mean that certain Collateral Trust
Agreement, dated as of June 30, 2004, by and among the Collateral Trustee
herein, as Individual Trustee thereunder, Wilmington Trust Company, a Delaware
banking corporation, not in its individual capacity but solely as corporate
trustee, as Corporate Trustee thereunder, the Borrower, and the Guarantors,
including without limitation, Grantor, as the same may hereafter be modified,
amended, restated, supplemented, refinanced or replaced from time to time.

 

(e) “Credit Agreement”: That certain Credit Agreement dated as of June 30, 2004
by and among Consol Energy Inc. (“Borrower”), PNC Bank, National Association and
Citicorp North America, Inc., as Co-Administrative Agents, the Credit Facility
Agent, LaSalle Bank National Association, Société Générale, New York Branch and
SunTrust Bank, each in its capacity as a co-documentation agent, the Lenders
described therein, the Guarantors party thereto, and Citigroup Global Markets
Inc. and PNC Capital Markets, Inc., as Joint Lead Arrangers, as the same may be
amended, amended and restated, supplemented, modified or replaced from time to
time, to the extent the same shall be in effect.

 

(f) “Credit Facility Agent”: shall mean PNC Bank, National Association, as
Paying Agent under the Credit Agreement.

 

(g) “Guarantors”: shall mean all Subsidiaries of the Borrower other than
Excluded Subsidiaries.

 

(h) “Hydrocarbon Property”: shall mean all of the following:

 

(1) All rights, titles, interests and estates now owned or hereafter acquired by
Grantor in and to the oil and gas leases and wells, and/or oil, gas and other
mineral leases and other interests and estates and the lands and premises
covered or affected thereby, which Hydrocarbon Property is otherwise referred to
herein, and specifically, but without limitation, the production payment
interests of Grantor in and to the undivided interests which are identified at
attached Exhibit A.

 

(2) All rights, titles, interests and estates now owned or hereafter acquired by
Grantor in and to (i) the properties now or hereafter pooled or unitized with
the Hydrocarbon Property; (ii) all presently existing or future unitization,
communitization, pooling agreements and declarations of pooled units and the
units created thereby (including, without limitation, all units created under
orders, regulations, rules or other official acts of any Federal, State or other
governmental body or agency having jurisdiction and any units created solely
among working interest owners pursuant to operating agreements or otherwise)
which may affect all or any portion of the Hydrocarbon Property including,
without limitation, those units which may be described or referred to on
attached Exhibit A; (iii) all purchase and sale agreements, exchange agreements,
production sales or other contracts, and other agreements which relate to any of
the Hydrocarbon Property or interests in the Hydrocarbon Property described or
referred to herein or on attached Exhibit A or to the production, sale,
purchase, exchange, processing, handling, storage, transporting or marketing of
the Hydrocarbons from or attributable to such Hydrocarbon Property or interests;
(iv) all geological, geophysical, engineering, accounting, title, legal and
other technical or business data concerning the Mortgaged Property or the
Hydrocarbons which are in the possession of Grantor and in which Grantor can
grant a security interest without violating any restrictions on assignment

 

S-2

--------------------------------------------------------------------------------

EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

therein, and all books, files, records, magnetic media, computer records and
other forms of recording or obtaining access to such data; and (v) the
Hydrocarbon Property identified at attached Exhibit A and covered by this Deed
of Trust even though Grantor’s interests therein be incorrectly described or a
description of a part or all of such Hydrocarbon Property or Grantor’s interests
therein be omitted; it being intended by Grantor and Beneficiary herein to cover
and affect hereby all interests which Grantor may now own or may hereafter
acquire in and to the Hydrocarbon Property notwithstanding that the interests as
specified on Exhibit A may be limited to particular lands, specified depths or
particular types of property interests.

 

(3) All rights, titles, interests and estates now owned or hereafter acquired by
Grantor in and to all Hydrocarbons.

 

(4) All tenements, hereditaments, appurtenances and properties in anywise
appertaining, belonging, affixed or incidental to the Hydrocarbon Property,
rights, titles, interests and estates described or referred to in paragraphs (1)
and (2) above, which are now owned or which may hereafter be acquired by
Grantor, including, without limitation, 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 Property or the lands pooled or unitized therewith including any and
all, surface leases, rights-of-way, easements, servitudes, licenses and other
surface and subsurface rights together with all additions, substitutions,
replacements, accessions and attachments to any and all of the foregoing
properties.

 

(5) All of the rights, titles and interests of every nature whatsoever now owned
or hereafter acquired by Grantor in and to the Hydrocarbon Property rights,
titles, interests and estates and every part and parcel thereof, including,
without limitation, the Hydrocarbon Property rights, titles, interests and
estates as the same may be enlarged by the discharge of any payments out of
production or by the removal of any charges or Permitted Liens to which any of
the Hydrocarbon Property rights, titles, interests or estates are subject, or
otherwise; all rights of Grantor to liens and security interests securing
payment of proceeds from the sale of production from the Mortgaged Property,
together with any and all renewals and extensions of any of the Hydrocarbon
Property rights, titles, interests or estates; all contracts and agreements
supplemental to or amendatory of or in substitution for the contracts and
agreements described or mentioned above; and any and all additional interests of
any kind hereafter acquired by Grantor in and to the Hydrocarbon Property
rights, titles, interests or estates.

 

(6) All accounts, contract rights, inventory, general intangibles, insurance
contracts and insurance proceeds constituting a part of, relating to or arising
out of those portions of the Hydrocarbon Property which are described in
paragraphs (1) through (5) above and all proceeds and products of all such
portions of the Mortgaged Property and payments in lieu of production (such as
“take or pay” payments), whether such proceeds or payments are goods, money,
documents, instruments, chattel paper, securities, accounts, general
intangibles, fixtures, real property or other assets.

 

(7) Any fractions or percentages specified on attached Exhibit A in referring to
Grantor’s interests are solely for purposes of the warranties made by Grantor
herein, and shall in no manner limit the quantum of interest affected by this
Section with respect to any Hydrocarbon Property or with respect to any unit or
well identified on said Exhibit A.

 

(i) “Hydrocarbons”: shall mean all rights, titles, interests and estates now
owned or hereafter acquired by Grantor in and to all oil, gas, coalbed methane
gas, casinghead gas, condensate, distillate, liquid hydrocarbons, gaseous
hydrocarbons and all products refined therefrom and all other minerals which may
attributable to the Hydrocarbon Property, the lands pooled or unitized therewith
and Grantor’s interests therein,

 

S-3

--------------------------------------------------------------------------------

EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

including all oil in tanks and all rents, issues, profits, proceeds, products,
revenues and other income from or attributable to the Hydrocarbon Property, the
lands pooled or unitized therewith and Grantor’s interests therein which are
subjected or required to be subjected to the liens and security interests of
this Deed of Trust.

 

(j) “Issuing and Paying Agency Agreement”: means the Issuing and Paying Agency
Agreement, dated as of December 31, 1991, among the Borrower, Consolidation Coal
Company, CONSOL Inc. and The Bank of Nova Scotia Trust Company of New York (as
successor paying agent to JP Morgan Chase Bank), delivered with respect to the
Senior Notes (1991), as further amended, modified, supplemented, extended,
restated, renewed or replaced from time to time.

 

(k) “Lenders”: shall mean those financial institutions from time to time
identified as Lenders pursuant to the Credit Agreement, and their respective
successors and assigns.

 

(l) “Loan Parties” shall mean Borrower, Grantor and the other Guarantors.

 

(m) “Mortgaged Leases”: shall mean all of Grantor’s leasehold interests in and
to the Hydrocarbons, the Hydrocarbon Property, the Premises, and all other
property interests identified at Exhibit A hereto.

 

(n) “Mortgaged Property”: Grantor’s right, title and interest in and to, (1) all
Hydrocarbons; (2) the Hydrocarbon Property; (3) the Pipelines, the rights of way
for which are identified at Exhibit B; (4) the fee and leasehold interests of
Grantor in the real property identified at Exhibit A, attached hereto and
incorporated herein by this reference, or, to the extent applicable, the fee or
leasehold interest in the surface of such real property, in each case together
with any greater estate therein as hereafter may be acquired by Grantor (the
“Gas Reserves”) and the fee and leasehold interests of Grantor in the real
property identified at Exhibit C, attached hereto and incorporated herein by
this reference, or, to the extent applicable, the fee or leasehold interest in
the surface of such real property, in each case together with any greater estate
therein as hereafter may be acquired by Grantor (the “Well Heads”) (the Gas
Reserves, the Pipelines, and the Well Heads are collectively referred to as the
“Land”), (5) all improvements, other than enclosed improvements, of any kind
located thereon, now owned or hereafter acquired by Grantor, now or at any time
situated, placed or constructed upon the Land (the “Improvements”; the Land and
Improvements are collectively referred to as the “Premises”), (6) all materials,
supplies, equipment, apparatus and other items of personal property now owned or
hereafter acquired by Grantor and now or hereafter attached to or installed in
any of the Improvements or the Land, and water, gas, electrical, telephone,
storm and sanitary sewer facilities and all other utilities whether or not
situated in easements (the “Fixtures”), (7) all goods, accounts, general
intangibles, instruments, documents, chattel paper and all other personal
property of any kind or character, including such items of personal property as
defined in the UCC (defined below), now owned or hereafter acquired by Grantor
and now or hereafter affixed to, placed upon, used in connection with, raising
from or otherwise related to the Premises (the “Personalty”), (8) all reserves,
escrows or impounds required under the Security Documents and all deposit
accounts maintained by Grantor with respect to the Mortgaged Property (the
“Deposit Accounts”), (9) all leases, licenses, concessions, occupancy agreements
or other agreements (written or oral, now or at any time in effect) which grant
to any Person, other than Grantor, a possessory interest in, or the right to
use, all or any part of the Mortgaged Property, together with all related
security and other deposits (the “Leases”), (10) all of the rents, revenues,
royalties, income, proceeds, profits, security and other types of deposits, and
other benefits paid or payable by parties to the Leases for using, leasing,
licensing possessing, operating from, residing in, selling or otherwise enjoying
the Mortgaged Property, (the “Rents”), (11) all other agreements, such as
construction contracts, architects’ agreements, engineers’ contracts, utility
contracts, maintenance agreements, management agreements, service contracts,
listing agreements, guaranties, warranties, all permits (subject to any required
regulatory approval), licenses, certificates and entitlements in any way
relating to the construction, use, occupancy, operation, maintenance, enjoyment
or ownership of the Mortgaged Property (the “Permits”), (12) all rights,
privileges, tenements, hereditaments, rights-of-way, easements, appendages and
appurtenances appertaining to the foregoing, (13) property tax refunds payable
with respect to the Mortgaged Property (the “Tax Refunds”), (14) all accessions,
replacements and substitutions for any of the foregoing and all proceeds thereof
(the “Proceeds”), (15) all insurance

 

S-4

--------------------------------------------------------------------------------

EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

policies, unearned premiums therefor and proceeds from such policies covering
any of the above property now or hereafter acquired by Grantor (the
“Insurance”), and (16) all awards, damages, remunerations, reimbursements,
settlements or compensation heretofore made or hereafter to be made by any
governmental authority pertaining to any condemnation or other taking (or any
purchase in lieu thereof) of all or any portion of the foregoing property rights
and interests (the “Condemnation Awards”). As used in this Deed of Trust, the
term “Mortgaged Property” shall mean all or, where the context permits or
requires, any portion of the above or any interest therein. Notwithstanding the
foregoing or anything to the contrary contained in this Deed of Trust, the terms
“Mortgaged Property”, “Land”, “Improvements”, “Premises”, “Fixtures”, “Leases”,
“Rents”, “Personalty”, “Permits”, “Proceeds”, “Insurance” and “Condemnation
Awards” shall apply only to the extent of Grantor’s interests therein.

 

(o) “Permitted Liens”: Collectively, liens permitted under the Credit Agreement,
including any lessor liens retained or otherwise existing pursuant to any of the
Leases, together with all other matters of title disclosed to Credit Facility
Agent in letters of counsel delivered in connection with the negotiation,
execution and delivery of this Deed of Trust.

 

(p) “Person”: shall mean any individual, corporation, partnership, limited
liability company, association, joint-stock company, trust, unincorporated
organization, joint venture, government or political subdivision or agency
thereof, or any other entity.

 

(q) “Pipelines”: shall mean all rights, titles, interests and estates now or
hereafter acquired by Grantor in and to the pipeline systems and processing
facilities, the rights of way which are identified at Exhibit B and located as
shown on the map attached as Exhibit D, and made a part hereof, and all related
facilities, including, but not limited to, all tangible personal property such
as materials, supplies, lines, pipe, connections, dehydrators, drips, fittings,
tanks, taps, valves, compressors, meters, machinery, processing and other
equipment and any and all other property and appurtenances used in connection
therewith or relating thereto, and any replacements, attachments or accessories
now or hereafter attached, added or affixed, and all Hydrocarbons nor or
hereafter transported and/or processed, and to be transported and/or processed,
through and by the Pipelines, and all rights, titles and interests, together
with all permits, licenses and approvals, to construct, operate and maintain the
said Pipelines.

 

(r) “Public Indenture”: means the Indenture, dated March 7, 2002, as amended by
the First Supplemental Indenture, dated March 7, 2002, as amended by the Second
Supplemental Indenture, dated September 30, 2003, and as further amended,
modified, supplemented, extended, restated, renewed or replaced from time to
time, by and among the Borrower, certain subsidiaries of the Borrower, and the
Public Trustee, as trustee, providing for the issuance of $250 million 7.875%
senior unsecured notes due March 1, 2012.

 

“Secured Debt”: (1) All fees, expenses and charges, including, without
limitation, indemnification, reimbursement or contribution obligations of the
Loan Parties to the Collateral Trustees, under (and as defined in) the
Collateral Trust Agreement; (2) all indebtedness and all other Obligations of
Grantor or any of the other Loan Parties to Credit Facility Agent or any of the
other Lenders under the Credit Agreement or any of the other Security Documents,
including, without limitation, (A) Revolving Credit Loans, evidenced by certain
Revolving Credit Notes, pursuant to the Credit Agreement, in an aggregate amount
not to exceed the sum of Four Hundred Million Dollars ($400,000,000), which
Revolving Credit Loans include, without limitation, Swing Loans made by Bank to
Borrower, evidenced by a certain Swing Loan Note, delivered by Borrower to Bank,
made pursuant to the Credit Agreement, in an amount not to exceed the sum of
Twenty Five Million Dollars ($25,000,000), (B) all of the reimbursement
obligations of Borrower and any Loan Party with respect to the Tranche B Letters
of Credit issued pursuant to the Credit Agreement, in an aggregate undrawn face
amount not to exceed the sum of Two Hundred Million Dollars ($200,000,000),
further including, without limitation, (C) obligations and liabilities of any
nature now or hereafter existing under or arising in connection with any
Revolving Letters of Credit, including, without limitation, the reimbursement
obligations in respect thereof, together with interest and other amounts payable
with respect thereto, and (F) all Obligations and other liabilities of any
nature now or hereafter existing under any Specified Swap Agreement; (3) all
indebtedness of Grantor or any of the other Loan

 

S-5

--------------------------------------------------------------------------------

EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

Parties existing pursuant to the Senior Notes (1991) in an aggregate amount of
Forty-Five Million Dollars ($45,000,000); and (3) all indebtedness of Grantor or
any of the other Loan Parties existing pursuant to the Senior Notes (2002), in
an aggregate amount of Two Hundred Fifty Million Dollars ($250,000,000).

 

(s) “Security Documents”: shall mean the Credit Agreement, the Credit Facility
Agent’s Letter, the Guaranty Agreement, the Indemnity, the Intercompany
Subordination Agreement, the Deed of Trusts and Deeds of Trust, the Notes, the
Patent, Trademark and Copyright Assignment, the Pledge Agreement, the Security
Agreement, any Specified Swap Agreements and any other instruments, certificates
or documents delivered or contemplated to be delivered hereunder or thereunder
or in connection herewith or therewith, as the same may be supplemented,
amended, extended, renewed or replaced from time to time in accordance herewith
or therewith, and Security Document shall mean any of the Security Documents.

 

(t) “Senior Notes (1991)”: shall mean the outstanding aggregate $45 million
principal amount of 8.25% notes due 2007, of the Borrower, issued pursuant to
the Issuing and Paying Agency Agreement.

 

(u) “Senior Notes (2002)”: shall mean an aggregate $250,000,000 principal amount
of 7.875% notes due 2012, issued pursuant to the Public Indenture.

 

(v) “UCC”: The Uniform Commercial Code West Virginia or, if the creation,
perfection and enforcement of any security interest herein granted is governed
by the laws of a state other than the State of West Virginia, then, as to the
matter in question, the Uniform Commercial Code in effect in that state.

 

ARTICLE 2

GRANT

 

Section 2.1 Grant. To secure the full and timely payment and performance of the
Secured Debt, Grantor MORTGAGES, GRANTS, BARGAINS, ASSIGNS, SELLS, CONVEYS and
CONFIRMS, to Trustee, the Mortgaged Property, subject, however, only to
Permitted Liens, TO HAVE AND TO HOLD the Mortgaged Property, IN TRUST, WITH
POWER OF SALE, and Grantor does hereby bind itself, its successors and assigns
to WARRANT AND FOREVER DEFEND the title to the Mortgaged Property identified at
Exhibit A unto Beneficiary; provided however, no warranty of title is made as to
the Mortgaged Property identified at Exhibit B and Exhibit C.

 

Provided further, subject to the terms hereof and of the Credit Agreement and
the other Security Documents, until an Event of Default shall occur, Grantor
shall have and possess the full right and privilege to own, lease, operate,
manage and control the Mortgaged Property in all respects, to extract the
Mineral Interests therefrom, and to do all other matters and things that Grantor
deems necessary, desirable or appropriate thereon and therewith.

 

ARTICLE 3

WARRANTIES, REPRESENTATIONS AND COVENANTS

 

Grantor warrants, represents and covenants to Beneficiary as follows:

 

Section 3.1 Title to Mortgaged Property and Lien of this Instrument. With
respect to the property identified at Exhibit A hereto, Grantor owns, or has
valid leasehold rights to, as applicable, the Mortgaged Property free and clear
of any liens, claims or interests, except for Permitted Liens, or matters
disclosed in title opinions delivered to Beneficiary by counsel to Grantor
contemporaneously herewith, and this Deed of Trust creates valid, enforceable
first priority liens and security interests against the Mortgaged Property
identified at Exhibit A. With respect to the Mortgaged Property identified at
Exhibit B and Exhibit C hereto, Grantor does not warrant title,

 

S-6

--------------------------------------------------------------------------------

EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

but to Grantor’s knowledge Grantor owns, or has valid leasehold rights to, as
applicable, the Mortgaged Property free and clear of any liens, claims or
interests, except the Permitted Liens, and this Deed of Trust creates valid,
enforceable liens and security interests against the Mortgaged Property only to
the extent of Grantor’s interests therein. Adverse matters of title that are
known to Grantor and which are material to the continuing business operations of
Grantor are disclosed on the Exhibits, where applicable. If adverse matters of
title which are material to the continuing business operations of Grantor arise
at any future time during which this Deed of Trust remains in force, Grantor
will promptly advise Credit Facility Agent in writing as to such matters.

 

Section 3.2 First Lien Status. Except for Permitted Liens, Grantor shall
preserve and protect the first lien and security interest status of this Deed of
Trust. If any lien or security interest other than a Permitted Lien is asserted
against the Mortgaged Property, Grantor shall promptly, and at its expense, (a)
give Beneficiary a detailed written notice of such lien or security interest
(including origin, amount and other terms), and (b) pay the underlying claim in
full or take such other action so as to cause it to be released or contest the
same in compliance with the requirements of the Credit Agreement and the
Collateral Trust Agreement (including the requirement of providing a bond or
other security satisfactory to Beneficiary).

 

Section 3.3 Payment and Performance. Grantor shall pay and perform the Secured
Debt in a timely manner, when required, and in material compliance with all
terms, covenants and conditions applicable thereto.

 

Section 3.4 Replacement of Fixtures. Subject to the terms of the Collateral
Trust Agreement and the Credit Agreement, Grantor shall not, without the prior
written consent of Beneficiary, permit any of the Fixtures owned or leased by
Grantor to be removed at any time from the Land or Improvements, unless the
removed item is removed temporarily for maintenance and repair or is permitted
to be so removed, or is not material to Grantor’s continuing business
operations.

 

Section 3.5 Inspection. Grantor shall permit Beneficiary and Credit Facility
Agent, and their respective agents, representatives and employees, upon
reasonable prior notice to Grantor, to inspect the Mortgaged Property and all
books and records of Grantor located thereon, as provided in the Credit
Agreement, provided that such right shall, with respect to Leased Land, be
subject to the provisions of any applicable Mortgaged Lease.

 

Section 3.6 Insurance; Condemnation Awards and Insurance Proceeds.

 

(a) Insurance. Grantor shall maintain or cause to be maintained, with respect to
the Mortgaged Property, insurance against loss or damage, as required pursuant
to the terms of the Credit Agreement. If any portion of an enclosed structure
now or hereafter located on the Mortgaged Property is located in an area
identified by the Federal Emergency Management Agency as an area having special
flood hazards and in which flood insurance has been made available under the
National Flood Insurance Act of 1968 (or any amendment or successor act
thereto), then Grantor shall maintain, or cause to be maintained, with a
financially sound and reputable insurer, flood insurance in an amount sufficient
to comply with all applicable rules and regulations promulgated pursuant to such
Act.

 

(b) Condemnation Awards. Subject to the provisions of any applicable Mortgaged
Lease, and also subject to the terms of the Credit Agreement applicable to
proceeds payable as the result of a Casualty Event, Grantor assigns all
Condemnation Awards to Beneficiary and authorizes Beneficiary to collect and
receive such Condemnation Awards and to give proper receipts and acquittances
therefor, subject to the terms of the Collateral Trust Agreement.

 

(c) Insurance Proceeds. Subject to the provisions of any applicable Mortgaged
Lease, and further subject to the terms of the Credit Agreement applicable to
proceeds payable as the result of a Casualty Event, Grantor assigns to
Beneficiary all proceeds of any insurance policies insuring against loss or
damage to the Mortgaged Property. Subject to the terms of the Credit Agreement,
and any applicable Mortgaged Lease, Grantor

 

S-7

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EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

authorizes Beneficiary to collect and receive such proceeds and authorizes and
directs the issuer of each of such insurance policies to make payment for all
such losses directly to Beneficiary, instead of to Grantor and Beneficiary
jointly.

 

ARTICLE 4

LEASEHOLD MORTGAGE PROVISIONS

 

Section 4.1 Representations; Warranties; Covenants. Grantor hereby represents,
warrants and covenants that, with respect to Mortgaged Leases that are material
to Grantor’s continuing business operations:

 

(a) Representations of Grantor. To the knowledge of Grantor, (1) such Mortgaged
Leases are unmodified and in full force and effect, (2) all rent and other
charges therein have been paid to the extent they are payable to the date
hereof, (3) Grantor enjoys the quiet and peaceful possession of such Premises,
(4) Grantor is not in default under any of the terms thereof and there are no
circumstances which, with the passage of time or the giving of notice or both,
would constitute an event of default thereunder, (5) the lessor thereunder is
not in default under any of the terms or provisions thereof on the part of the
lessor to be observed or performed;

 

(b) Payment of Rents. Grantor shall promptly pay, when due and payable, the rent
and other charges payable pursuant to such Mortgaged Lease, and will timely
perform and observe, in all material respects, all of the other terms, covenants
and conditions required to be performed and observed by Grantor as lessee under
such Mortgaged Lease;

 

(c) Notice of Default. Grantor shall notify Beneficiary in writing of any
material default by Grantor in the performance or observance of any terms,
covenants or conditions on the part of Grantor to be performed or observed under
such Mortgaged Lease within three (3) days after Grantor obtains knowledge of
such default; Grantor shall, immediately upon receipt thereof, deliver a copy of
each written notice given to Grantor by the lessor pursuant to any Mortgaged
Lease and promptly notify Beneficiary in writing of any material default by the
lessor in the performance or observance of any of the terms, covenants or
conditions on the part of the lessor to be performed or observed thereunder;

 

(d) No Termination. Unless required under the terms of any Mortgaged Lease,
Grantor shall not, without the prior written consent of Beneficiary (which
consent will not be unreasonably withheld, conditioned or delayed) terminate,
modify or surrender any such Mortgaged Lease, and any such attempted
termination, modification or surrender without such consent shall be void; and

 

(e) Estoppel. Grantor shall, within thirty (30) days after written request from
Beneficiary, use its reasonable efforts to obtain from the lessor and deliver to
Beneficiary a certificate setting forth the name of the tenant under any
Mortgaged Lease and stating that such Mortgaged Lease is in full force and
effect, is unmodified or, if such Mortgaged Lease has been modified, the date of
each modification (together with copies of each such modification), that no
notice of termination thereof has been served on Grantor, stating that no
default or event which with notice or lapse of time (or both) would become a
default is existing under, such Mortgaged Lease (or if any such default or event
is existing, specifying the nature of such default or event), stating the date
to which rent has been paid, and containing such other statements and
representations as may be requested by Beneficiary.

 

Section 4.2 No Merger. So long as any of the Secured Debt remains unpaid or
unperformed, the fee title to and the leasehold estate in the Premises subject
to any Mortgaged Lease shall not merge but shall always be kept separate and
distinct notwithstanding the union of such estates in the lessor or Grantor, or
in a third party, by purchase or otherwise. If Grantor acquires the fee title or
any other estate, title or interest in the Premises, or any part thereof, the
lien of this Deed of Trust shall attach to, cover and be a lien upon such
acquired estate, title or interest and the same shall thereupon be and become a
part of the Mortgaged Property with the same force and effect as if specifically
encumbered herein. Grantor agrees to execute all instruments and documents that

 

S-8

--------------------------------------------------------------------------------

EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

Beneficiary may reasonably require to ratify, confirm and further evidence the
lien of this Deed of Trust on the acquired estate, title or interest.
Furthermore, Grantor hereby appoints Beneficiary as its true and lawful
attorney-in-fact to execute and deliver, following an Actionable Default, all
such instruments and documents in the name and on behalf of Grantor. This power,
being coupled with an interest, shall be irrevocable as long as any portion of
the Secured Debt remains unpaid.

 

Section 4.3 Beneficiary as Lessee. If any Mortgaged Lease, that is material to
the continuing business operations of Grantor, shall be terminated prior to the
natural expiration of its term due to default by Grantor or any tenant
thereunder, and if, pursuant to the provisions of such Mortgaged Lease,
Beneficiary or its designee shall acquire from the lessor a new lease of the
Premises, Grantor shall have no right, title or interest in or to such new lease
or the leasehold estate created thereby, or renewal privileges therein
contained.

 

Section 4.4 No Assignment. Notwithstanding anything to the contrary contained
herein, this Deed of Trust shall not constitute an assignment of any Mortgaged
Lease within the meaning of any provision thereof prohibiting its assignment and
Beneficiary shall have no liability or obligation thereunder by reason of its
acceptance of this Deed of Trust. Beneficiary shall be liable for the
obligations of the tenant arising out of any Mortgaged Lease for only that
period of time for which Beneficiary is in possession of the Premises or has
acquired, by foreclosure or otherwise, and is holding all of Grantor’s right,
title and interest therein.

 

Section 4.5 Required Landlord Consents. Notwithstanding anything to the contrary
contained in this Deed of Trust, to the extent that the assignment, transfer or
conveyance of, or granting of a Lien or security interest in, any part of the
Mortgaged Property by Grantor to Beneficiary under this Deed of Trust is
prohibited by the terms of the instrument, contract or agreement evidencing or
creating the Mortgaged Property, or would result in a breach or default by
Grantor thereunder, or the termination thereunder, in each case due to the
granting of a lien or security interest therein, the Mortgaged Property shall
not include, and shall exclude, such instrument, contract or agreement,
including, but not limited to, the granting of a mortgage or deed of trust lien
against a leasehold interest held by Grantor when the lease, by its terms,
requires the consent of the lessor to an effective assignment of the lessee’s
leasehold estate.

 

ARTICLE 5

DEFAULT AND FORECLOSURE

 

Section 5.1 Remedies. Upon the occurrence and during the continuance of an
Actionable Default, subject to the terms of the Collateral Trust Agreement, any
or all of the following rights, remedies and recourses may be exercised:

 

(a) Acceleration. Any holder of any portion of the Secured Debt may declare that
portion of the Secured Debt, or any portion thereof, to be immediately due and
payable, without further notice, presentment, protest, notice of intent to
accelerate, notice of acceleration, demand or action of any nature whatsoever
(each of which hereby is expressly waived by Grantor), whereupon the same shall
become immediately due and payable.

 

(b) Entry on Mortgaged Property. Subject to the provisions of any applicable
Mortgaged Lease and applicable law, Beneficiary may enter the Mortgaged Property
and take exclusive possession thereof and of all books, records and accounts
relating thereto or located thereon. If Grantor remains in possession of the
Mortgaged Property following the occurrence and during the continuance of an
Actionable Default and without Beneficiary’s prior written consent, subject to
the provisions of any applicable Mortgaged Lease and applicable law, Beneficiary
may invoke any legal remedies to dispossess Grantor.

 

(c) Operation of Mortgaged Property. Subject to the provisions of any applicable
Mortgaged Lease, Beneficiary may hold, lease, develop, manage, operate or
otherwise use the Mortgaged Property upon such terms and conditions as
Beneficiary may deem reasonable under the circumstances (including, without
limitation,

 

S-9

--------------------------------------------------------------------------------

EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

making such repairs, alterations, additions and improvements and taking other
actions, from time to time, as Beneficiary deems necessary or desirable, also
including the mining and sale of coal produced from the Mortgaged Property), and
apply all Rents and other amounts collected by Beneficiary in connection
therewith in accordance with the provisions of Section 5.7.

 

(d) Power of Sale of the Mortgaged Property. Upon the occurrence of an Event of
Default and if such event shall be continuing, the Trustee shall have the right
and power to sell, to the extent permitted by law, at one or more sales, as an
entirety or in parcels, as it may elect, the real property consisting of all or
any part of the Mortgaged Property, at such place or places and otherwise in
such manner and upon such notice as may be required by law, or, in the absence
of any such requirement, as the Beneficiary may deem appropriate, and to make
conveyance to the purchaser or purchasers; and the Grantor shall warrant title
to such real property to such purchaser or purchasers to the extent warranted
herein. The Trustee may postpone the sale of all or any portion of such real
property by public announcement at the time and place of such sale, and from
time to time thereafter may further postpone such sale by public announcement
made at the time of sale fixed by the preceding postponement. The right of sale
hereunder shall not be exhausted by one or any sale, and the Trustee may make
other and successive sales until all of the trust estate be legally sold. If
Beneficiary is the highest bidder, Beneficiary may credit the portion of the
purchase price that would be distributed to the Secured Debt pursuant to the
Collateral Trust Agreement.

 

(e) Foreclosure and Sale. Beneficiary may institute proceedings for the complete
foreclosure of this Deed of Trust by judicial action, in which case the
Mortgaged Property may be sold for cash or credit in one or more parcels,
subject to the provisions of any applicable Mortgaged Lease. With respect to any
notices required or permitted under the UCC, Grantor agrees that ten (10) days’
prior written notice shall be deemed commercially reasonable. At any such sale
by virtue of any judicial proceedings, title to and right of possession of any
such property shall pass to the purchaser thereof, and to the fullest extent
permitted by law, Grantor shall be completely and irrevocably divested of all of
its right, title, interest, claim, equity, equity of redemption, and demand
whatsoever, either at law or in equity, in and to the property sold and such
sale shall be a perpetual bar both at law and in equity against Grantor, and
against all other Persons claiming or to claim the property sold or any part
thereof, by, through or under Grantor. Beneficiary may be a purchaser at such
sale. If Beneficiary is the highest bidder, Beneficiary may credit the portion
of the purchase price that would be distributed to the Secured Debt pursuant to
the Collateral Trust Agreement. In the event this Deed of Trust is foreclosed by
judicial action, appraisement of the Mortgaged Property is waived.

 

(f) Receiver. Beneficiary may make application to a court of competent
jurisdiction for, and obtain from such court as a matter of strict right and
without notice to Grantor or regard to the adequacy of the Mortgaged Property
for the repayment of the Secured Debt, the appointment of a receiver of the
Mortgaged Property, and Grantor irrevocably consents to such appointment. Any
such receiver shall have all the usual powers and duties of receivers in similar
eases, including the full power to rent, maintain and otherwise operate the
Mortgaged Property upon such terms as may be approved by the court, and in a
manner consistent with the terms of any applicable Mortgaged Lease, and shall
apply such Rents in accordance with the provisions of Section 5.7.

 

(g) Other Remedies. Subject to the provisions of any applicable Mortgaged Lease,
Beneficiary may exercise all other rights, remedies and recourses granted to
Beneficiary with respect to all or any portion of the Secured Debt pursuant to
the terms of the Collateral Trust Agreement or the other Security Documents, or
otherwise available at law or in equity.

 

Section 5.2 Separate Sales. To the extent not prohibited under the terms of any
applicable Mortgaged Lease, the Mortgaged Property may be sold in one or more
parcels and in such manner and order as Beneficiary in its sole discretion may
elect. The right of sale arising out of any Actionable Default shall not be
exhausted by any one or more sales.

 

S-10

--------------------------------------------------------------------------------

EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

Section 5.3 Remedies Cumulative, Concurrent and Nonexclusive. Beneficiary shall
have all rights, remedies and recourses with respect to the enforcement of all
or any portion of the Secured Debt granted pursuant to the Collateral Trust
Agreement and the other Security Documents, and available at law or equity
(including the UCC), which rights, (a) shall be cumulative and concurrent, (b)
may be pursued separately, successively or concurrently against Grantor or
others obligated for the payment or performance of the Secured Debt or against
the Mortgaged Property, or against any one or more of them, at the sole
discretion of Beneficiary, as the case may be, (c) may be exercised as often as
occasion therefore shall arise, and the exercise or failure to exercise any of
them shall not be construed as a waiver or release thereof or of any other
right, remedy or recourse, and (d) are intended to be, and shall be,
nonexclusive. No action by Beneficiary in the enforcement of any rights,
remedies or recourses relating to any portion of the Secured Debt, or otherwise
at law or equity shall be deemed to cure any Actionable Default.

 

Section 5.4 Release of and Resort to Collateral. Subject to the terms of the
Collateral Trust Agreement, Beneficiary may release, regardless of consideration
and without the necessity for any notice to or consent by the holder of any
subordinate lien on the Mortgaged Property, any part of the Mortgaged Property
without, as to the remainder, in any way impairing, affecting, subordinating or
releasing the lien or security interest created in or evidenced by this Deed of
Trust or its status as a first and prior lien and security interest in and to
the Mortgaged Property. For payment of the Secured Debt, Beneficiary may resort
to any other security in such order and manner as Beneficiary may elect.

 

Section 5.5 Waiver of Redemption, Notice and Marshalling of Assets. To the
fullest extent permitted by law, Grantor hereby irrevocably and unconditionally
waives and releases (a) all benefit that might accrue to Grantor by virtue of
any present or future statute of limitations or law or judicial decision
exempting the Mortgaged Property from attachment, levy or sale on execution or
providing for any stay of execution, exemption from civil process, redemption or
extension of time for payment, (b) all notices of any Actionable Default or of
Beneficiary’s election to exercise or the actual exercise of any right, remedy
or recourse provided for under the Collateral Trust Agreement, the Credit
Agreement or other Security Documents, or this Deed of Trust, and (c) any right
to a marshalling of assets or a sale in inverse order of alienation.

 

Section 5.6 Discontinuance of Proceedings. If Beneficiary shall have proceeded
to invoke any right, remedy or recourse permitted under the Collateral Trust
Agreement or this Deed of Trust and shall thereafter elect to discontinue or
abandon it for any reason, Beneficiary shall have the unqualified right to do so
and, in such an event, Grantor and Beneficiary shall be restored to their former
positions with respect to the Secured Debt, the Security Documents, the
Mortgaged Property and otherwise, and the rights, remedies, recourses and powers
of Beneficiary shall continue as if the right, remedy or recourse had never been
invoked, but no such discontinuance or abandonment shall waive any Actionable
Default which may then exist or the right of Beneficiary thereafter to exercise
any right, remedy or recourse under the Collateral Trust Agreement, the Credit
Agreement, or this Deed of Trust for such Actionable Default.

 

Section 5.7 Application of Proceeds. The proceeds of any sale of the
“as-extracted” collateral, and the Rents, and other amounts generated by the
holding, leasing, management, operation or other use of the Mortgaged Property,
shall be applied by Beneficiary (or the receiver, if one is appointed) in the
following order unless otherwise required by applicable law:

 

(a) to the payment of the costs and expenses of taking possession of the
Mortgaged Property and of holding, using, leasing, repairing, improving and
selling the same, including, without limitation (1) receiver’s fees and
expenses, including the repayment of the amounts evidenced by any receiver’s
certificates, (2) court costs, (3) attorneys’ and accountants’ fees and
expenses, (4) costs of advertisement and (5) the payment of all rent and other
charges under any applicable Mortgaged Lease;

 

(b) to the payment and performance of the Secured Debt, in such manner and order
of preference as set forth in the Collateral Trust Agreement; and

 

S-11

--------------------------------------------------------------------------------

EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

(c) the balance, if any, to the Persons legally entitled thereto.

 

Section 5.8 Occupancy After Foreclosure. Any sale of the Mortgaged Property or
any part thereof in accordance with Section 5.1(d) or (e) will divest all right,
title and interest of Grantor in and to the property sold. Subject to applicable
law and any applicable Mortgaged Lease, any purchaser at a foreclosure sale will
receive immediate possession of the property purchased. If Grantor retains
possession of such property or any part thereof subsequent to such sale, Grantor
will be considered a tenant at sufferance of the purchaser, and will, if Grantor
remains in possession after demand to remove, be subject to eviction and
removal, forcible or otherwise, with or without process of law.

 

Section 5.9 Additional Advances and Disbursements; Costs of Enforcement.

 

(a) Upon the occurrence and during the continuance of any Actionable Default,
Beneficiary shall have the right, but not the obligation, to cure such
Actionable Default in the name and on behalf of Grantor. All sums advanced and
expenses incurred at any time by Beneficiary under this Section 5.9, or
otherwise under the Collateral Trust Agreement, this Deed of Trust, any of the
Security Documents, or applicable law, shall bear interest from the date that
such sum is advanced or expense incurred, to and including the date of
reimbursement, computed at the highest rate at which interest is then computed
on any portion of the Secured Debt, and all such sums, together with interest
thereon, shall be secured by this Deed of Trust.

 

(b) Grantor shall pay all expenses (including reasonable attorneys’ fees and
expenses) of or incidental to the perfection and enforcement of this Deed of
Trust and the Collateral Trust Agreement, or the enforcement, compromise or
settlement of the Secured Debt or any claim under this Deed of Trust or the
Collateral Trust Agreement and for the curing thereof, or for defending or
asserting the rights and claims of Beneficiary in respect thereof, by litigation
or otherwise.

 

Section 5.10 No Mortgagee in Possession. Neither the enforcement of any of the
remedies under this Article 5, the assignment of the Rents and Leases under
Article 6, the security interests under Article 7, nor any other remedies
afforded to Beneficiary hereunder or under the Collateral Trust Agreement, or at
law or in equity shall cause Beneficiary to be deemed or construed to be a
mortgagee in possession of the Mortgaged Property, to obligate Beneficiary to
lease the Mortgaged Property or attempt to do so, or to take any action, incur
any expense, or perform or discharge any obligation, duty or liability
whatsoever under any of the Leases or otherwise.

 

Section 5.11 Effect of Sale. Any sale or sales of the Mortgaged Property,
whether under the power of sale herein granted and conferred or by virtue of
judicial proceedings, shall operate to divest all right, title, interest, claim
and demand whatsoever either at law or in equity, of the Grantor of, in and to
the premises and the property sold, and shall be a perpetual bar, both at law
and in equity, against the Grantor of, in and to the premises and the property
sold, and shall be a perpetual bar, both at law and in equity, against the
Grantor, and the Grantor’s successors or assigns, and against any and all
persons claiming or who shall thereafter claim all or any of the property sold
from, through or under the Grantor or the Grantor’s successors or assigns.
Nevertheless, the Grantor, if requested by the Beneficiary so to do, shall joint
in the execution and delivery of all proper conveyances, assignments and
transfers of the properties so sold.

 

ARTICLE 6

ASSIGNMENT OF RENTS AND LEASES

 

Section 6.1 Assignment of Production. Grantor has absolutely and unconditionally
granted, assigned, transferred and conveyed, and does hereby absolutely and
unconditionally grant, assign, transfer and convey unto Beneficiary all of the
Hydrocarbons, less royalties payable, taxes, transportation costs, and other
expenses incurred by the Grantor in the production of the Hydrocarbons, and all
products obtained or processed

 

S-12

--------------------------------------------------------------------------------

EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

therefrom, and the revenues and proceeds now and hereafter attributable to the
Hydrocarbons and said products and all payments in lieu of the Hydrocarbons such
as “take or pay” payments or settlements. The Hydrocarbons and products are to
be delivered into the Pipelines and other pipe lines connected with the
Mortgaged Property, or to the purchaser thereof, to the credit of Beneficiary,
for its benefit and the benefit of Lenders and other holders of the Secured
Debt. At any time following the occurrence of an Actionable Default, (i) Grantor
agrees to perform all such acts, and to execute all such further assignments,
transfers and division orders and other instruments as may be required or
desired by Trustee or Beneficiary or any party in order to have said proceeds
and revenues so paid to Beneficiary, and (ii) Trustee and Beneficiary are fully
authorized to receive and receipt for said revenues and proceeds; to endorse and
cash any and all checks and drafts payable to the order of Grantor, Trustee, or
Beneficiary for the account of Grantor received from or in connection with said
revenues or proceeds and to hold the proceeds thereof in a bank account as
additional collateral for the Secured Debt, and to execute transfer and division
orders in the name of Grantor, or otherwise, with warranties binding Grantor.
Trustee and Beneficiary shall not be liable for any delay, neglect or failure to
effect collection of any proceeds or to take any other action in connection
therewith or hereunder; but Trustee and Beneficiary shall have the right, at
their election, in the name of Grantor or otherwise, to prosecute and defend any
and all actions or legal proceedings deemed advisable by Trustee or Beneficiary
in order to collect such funds and to protect the interests of Trustee,
Beneficiary and/or Grantor, with all costs, expenses and attorneys’ fees
incurred in connection therewith being paid by Grantor. Grantor hereby appoints
Beneficiary as its attorney-in-fact to pursue any and all rights of Grantor to
liens on and security interests in the Hydrocarbons securing payment of proceeds
of runs attributable to the Hydrocarbons. Grantor hereby further transfers and
assigns to Beneficiary any and all such liens, security interests, financing
statements or similar interests of Grantor attributable to its interest in the
Hydrocarbons and proceeds of runs therefrom arising under or created by said
statutory provision, judicial decision or otherwise. The power of attorney
granted to Beneficiary in this Section 6.1, being coupled with an interest,
shall be irrevocable so long as the Secured Debt or any part thereof remains
unpaid. Until such time as an Actionable Default has occurred and is continuing,
but subject to the provisions of the Credit Agreement, Beneficiary hereby grants
to Grantor a license to sell, receive and receipt for proceeds from the sale of
Hydrocarbons, which license shall automatically terminate upon such Actionable
Default and for so long as the same continues.

 

Section 6.2 Assignment. In furtherance of and in addition to the assignment made
by Grantor in Section 2.1 of this Deed of Trust, Grantor hereby absolutely and
unconditionally assigns, sells, transfers and conveys to Beneficiary all of its
right, title and interest in and to all Leases, whether now existing or
hereafter entered into, and all of its right, title and interest in and to all
Rents. This assignment is an absolute assignment and not an assignment for
additional security only. So long as no Actionable Default shall have occurred
and be continuing, Grantor shall have a revocable license from Beneficiary to
exercise all rights extended to the landlord under the Leases, including the
right to receive and collect all Rents and to hold the Rents in trust for use in
the payment and performance of the Secured Debt, and to otherwise use the same.
The foregoing license is granted subject to the conditional limitation that no
Actionable Default shall have occurred and be continuing. Upon the occurrence
and during the continuance of an Actionable Default, whether or not legal
proceedings have commenced, and without regard to waste, adequacy of security
for the Secured Debt or solvency of Grantor, the license herein granted shall
automatically expire and terminate, without notice to Grantor by Beneficiary
(any such notice being hereby expressly waived by Grantor to the extent
permitted by applicable law).

 

Section 6.3 Perfection Upon Recordation. Grantor acknowledges that Beneficiary
has taken all actions necessary to obtain, and that upon recordation of this
Deed of Trust, Beneficiary shall have, to the extent permitted under applicable
law, a valid and fully perfected, first priority, present assignment of the
Rents arising out of the Leases and all security for such Leases. Grantor
acknowledges and agrees that upon recordation of this Deed of Trust,
Beneficiary’s interest in the Rents shall be deemed to be fully perfected,
“choate” and enforced as to Grantor and to the extent permitted under applicable
law, all third parties, including, without limitation, any subsequently
appointed trustee in any case under Title 11 of the United States Code (the
“Bankruptcy Code”), without the necessity of commencing a foreclosure action
with respect to this Deed of Trust, making formal demand for the Rents,
obtaining the appointment of a receiver or taking any other affirmative action.

 

S-13

--------------------------------------------------------------------------------

EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

Section 6.4 Bankruptcy Provisions. Without limitation of the absolute nature of
the assignment of the Rents hereunder, Grantor and Beneficiary agree that (a)
this Deed of Trust shall constitute a “security agreement” for purposes of
Section 552(b) of the Bankruptcy Code, (b) the security interest created by this
Deed of Trust extends to property of Grantor acquired before the commencement of
a case in bankruptcy and to all amounts paid as Rents and (c) such security
interest shall extend to all Rents acquired by the estate after the commencement
of any case in bankruptcy.

 

Section 6.5 Operation By Third Parties. All or portions of the Mortgaged
Property may be comprised of interests in the Hydrocarbon Property which are
other than working interests or which may be operated by a party or parties
other than Grantor and with respect to all or any such interests and properties
as may be comprised of interests other than working interests or which may be
operated by parties other than Grantor, Grantor shall further use its best
efforts to obtain compliance with all covenants of Grantor herein by the working
interest owners or the operator or operators of such leases or properties, to
the extent that it has the ability to cause the operator or operators to do so.

 

Section 6.6 No Merger of Estates. So long as any part of the Secured Debt remain
unpaid and undischarged, the fee and leasehold estates to the Mortgaged Property
shall not merge, but shall remain separate and distinct, notwithstanding the
union of such estates either in Grantor, Beneficiary, any tenant or any third
party by purchase or otherwise.

 

ARTICLE 7

SECURITY AGREEMENT AND FIXTURE FILING

 

Section 7.1 Security Interest. This Deed of Trust constitutes a “security
agreement” on personal property within the meaning of the UCC and other
applicable law and with respect to the Fixtures, Hydrocarbons, Pipelines,
Leases, Rents, Permits, Personalty, Tax Refunds, Proceeds, Insurance and
Condemnation Awards. To this end, Grantor grants to Beneficiary a first and
prior security interest in the Fixtures, Hydrocarbons, Pipelines, Leases, Rents,
Permits, Personalty, Tax Refunds, Proceeds, Insurance, Condemnation Awards and
all other Mortgaged Property, including “as-extracted collateral” (as such terms
are used in the UCC), also including coal, oil and gas, and other minerals, to
secure the payment and performance of the Secured Debt, and agrees that
Beneficiary shall have all the rights and remedies of a secured party under the
UCC with respect to such property. Any notice of sale, disposition or other
intended action by Beneficiary with respect to the Fixtures, Hydrocarbons,
Pipelines, Leases, Rents, Permits, Personalty, Tax Refunds, Proceeds, Insurance
and Condemnation Awards or other Mortgaged Property, including without
limitation, “as-extracted collateral” (as such terms are used in the UCC),
including coal and other minerals, sent to Grantor at least ten (10) days prior
to any action under the UCC shall constitute reasonable notice to Grantor.

 

Section 7.2 Financing Statements. Grantor shall prepare and deliver to
Beneficiary such financing statements, and shall execute and deliver to
Beneficiary such other documents, instruments and further assurances, in each
case in form and substance satisfactory to Beneficiary, as Beneficiary may, from
time to time, reasonably consider necessary to create, perfect and preserve
Beneficiary’s security interest hereunder. Grantor hereby irrevocably authorizes
Beneficiary to cause financing statements (and amendments thereto and
continuations thereof) and any such documents, instruments and assurances to be
recorded and filed, at such times and places as may be required or permitted by
law to so create, perfect and preserve such security interest. Grantor
represents and warrants to Beneficiary that its jurisdiction of organization as
set forth on Schedule 1 hereto is correct. After the date of this Deed of Trust,
Grantor shall not change its name, type of organization, organizational
identification number (if any), jurisdiction of organization or location (within
the meaning of the UCC) without giving at least thirty (30) days’ prior written
notice to Beneficiary.

 

Section 7.3 Fixture and “as-extracted” Collateral Filing. This Deed of Trust
shall also constitute a “fixture filing” and an “as-extracted” collateral filing
for the purposes of the UCC against all of the

 

S-14

--------------------------------------------------------------------------------

EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

Mortgaged Property which is or is to become fixtures or “as-extracted”
collateral related to the Premises. The information provided in this Section 7.1
is provided so that this Deed of Trust shall comply with the requirements of the
UCC for a mortgage instrument to be filed as a financing statement. Grantor is
the “Debtor” and its name and mailing address are set forth in the preamble of
this Deed of Trust immediately preceding Article 1. Beneficiary is the “Secured
Party” and its name and mailing address from which information concerning the
security interest granted herein may be obtained are also set forth in the
preamble of this Deed of Trust immediately preceding Articles 1. A statement
describing the portion of the Mortgaged Property comprising the fixtures hereby
secured is set forth in Section 1.1(h) of this Deed of Trust. Grantor represents
and warrants to Beneficiary that Grantor is the record owner of the applicable
fee title or owner of the leasehold interest in the Mortgaged Property. The
employer identification number of Grantor, and its organizational identification
number are set forth on Schedule 1 hereto.

 

ARTICLE 8

MISCELLANEOUS

 

Section 8.1 Notices. Any notice required or permitted to be given under this
Deed of Trust shall be given in accordance with Section 11.6 of the Credit
Agreement.

 

Section 8.2 Covenants Running with the Land. All obligations contained in this
Deed of Trust are intended by Grantor and Beneficiary to be, and shall be
construed as, covenants running with the Mortgaged Property. As used herein,
“Grantor” shall refer to the party named in the first paragraph of this Deed of
Trust and to any subsequent owner of all or any portion of the Mortgaged
Property. All Persons who may have or acquire an interest in the Mortgaged
Property shall be deemed to have notice of, and be bound by, the terms of this
Deed of Trust; provided, however, that no such party shall be entitled to any
rights, thereunder without the prior written consent of Beneficiary.

 

Section 8.3 Attorney-in-Fact. Grantor hereby irrevocably appoints Beneficiary as
its attorney-in-fact, which agency is coupled with an interest and with full
power of substitution, with full authority in the place and stead of Grantor and
in the name of Grantor or otherwise (a) to execute and/or record any notices of
completion, cessation of labor or any other notices that Beneficiary deems
appropriate to protect Beneficiary’s interest, if Grantor shall fail to do so
within ten (10) days after written request by Beneficiary, (b) upon the issuance
of a deed pursuant to the foreclosure of this Deed of Trust or the delivery of a
deed in lieu of foreclosure, to execute all instruments of assignment,
conveyance or further assurance with respect to the Leases, Rents, Deposit
Accounts, Property Agreements, Tax Refunds, Permits, Personalty, Proceeds,
Insurance and Condemnation Awards in favor of the grantee of any such deed and
as may be necessary or desirable for such purpose, (c) to prepare, execute, and
file or record financing statements and continuation statements, and to prepare,
execute and file or record applications for registration and like papers
necessary to create, perfect or preserve Beneficiary’s security interests and
rights in or to any of the Mortgaged Property, and (d) after the occurrence and
during the continuance of any Actionable Default, to perform any obligation of
Grantor hereunder, provided, however, that (1) Beneficiary shall not under any
circumstances be obligated to perform any obligation of Grantor, (2) any sums
advanced by Beneficiary in such performance shall be added to and included in
the Secured Debt and shall bear interest at the highest rate at which interest
is then computed on any portion of the Secured Debt; (3) Beneficiary as such
attorney-in-fact shall only be accountable for such funds as are actually
received by Beneficiary; and (4) Beneficiary shall not be liable to Grantor or
any other person or entity for any failure to take any action which it is
empowered to take under this Section 8.3.

 

Section 8.4 Successors and Assigns. This Deed of Trust shall be binding upon and
inure to the benefit of Beneficiary and Grantor and their respective successors
and assigns. Grantor shall not, without the prior written consent of
Beneficiary, assign any rights, duties or obligations hereunder.

 

Section 8.5 No Waiver. Any failure by Beneficiary or to insist upon strict
performance of any of the terms, provisions or conditions of the Collateral
Trust Agreement or this Deed of Trust, or of any other document or instrument
relating to any portion of the Secured Debt, shall not be deemed to be a waiver
of same, and

 

S-15

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EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

Beneficiary shall have the right at any time to insist upon strict performance
of all of such terms, provisions and conditions.

 

Section 8.6 Conflicts Between Documents. In the event of any conflict between
the provisions of this Deed of Trust, the Credit Agreement or any of the other
Security Documents and the provisions of the Collateral Trust Agreement, the
provisions of the Collateral Trust Agreement shall control. Notwithstanding any
provision in this Deed of Trust, the Credit Agreement or any of the Security
Documents to the contrary, the parties and signatories hereto acknowledge and
agree that any and all rights, powers, privileges, duties, responsibilities,
liabilities and/or obligations (including but not limited to the right to grant
or withhold consent and the right to act or refrain from acting), whether
discretionary or mandatory, are and shall be exercised by the Collateral Trustee
solely in accordance with the terms and conditions of the Collateral Trust
Agreement, at the direction of the Credit Facility Agent or other entity
specified in the Collateral Trust Agreement as having the right to give
direction to the Collateral Trustee, and subject further to the rights of the
Collateral Trustee to require officers’ certificate(s), opinion(s) and advice
from counsel, accountants, appraisers and other third parties, advancement of
expenses and/or assurances of indemnity satisfactory to the Collateral Trustee.
If any conflict or inconsistence exists between this Deed of Trust and the
Credit Agreement, the terms of the Credit Agreement shall govern.

 

Section 8.7 Release or Reconveyance. Upon payment and performance in full of the
Secured Debt, or upon a sale or other disposition of the Mortgaged Property
permitted by the Credit Agreement and the Collateral Trust Agreement,
Beneficiary, at Grantor’s request and expense, shall release the liens and
security interests created by this Deed of Trust or reconvey the Mortgaged
Property to Grantor.

 

Section 8.8 Waiver of Stay, Moratorium and Similar Rights. Grantor agrees, to
the full extent that it may lawfully do so, that it will not at any time insist
upon or plead or in any way take advantage of any stay, marshalling of assets,
extension, redemption or moratorium law now or hereafter in force and effect so
as to prevent or hinder the enforcement of the provisions of this Deed of Trust
or the Collateral Trust Agreement, or any agreement between Grantor and
Beneficiary or any rights or remedies of Beneficiary.

 

Section 8.9 Applicable Law. The provisions of this Deed of Trust regarding the
creation, perfection and enforcement of the liens and security interests herein
granted shall be governed by and construed under the laws of the state in which
the Mortgaged Property is located. All other provisions of this Deed of Trust
shall be governed by the laws of the Commonwealth of Pennsylvania.

 

Section 8.10 Headings. The Article, Section and Subsection titles hereof are
inserted for convenience of reference only and shall in no way alter, modify or
define, or be used in construing, the text of such Articles, Sections or
Subsections.

 

Section 8.11 Severability. If any provision of this Deed of Trust shall be held
by any court of competent jurisdiction to be unlawful, void or unenforceable for
any reason, such provision shall be deemed severable from and shall in no way
affect the enforceability and validity of the remaining provisions of this Deed
of Trust.

 

Section 8.12 Entire Agreement. This Deed of Trust, the Credit Agreement, the
Collateral Trust Agreement, and the Security Documents embody the entire
agreement and understanding between Beneficiary and Grantor relating to the
subject matter hereof and thereof and supersede all prior agreements and
understandings between such parties relating to the subject matter hereof and
thereof. Accordingly, such documents may not be contradicted by evidence of
prior, contemporaneous or subsequent oral agreements of the parties. There are
no unwritten oral agreements between the parties.

 

S-16

--------------------------------------------------------------------------------

EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

Section 8.13 Beneficiary as Collateral Trustee; Successor Collateral Trustees.

 

(a) Beneficiary shall have the right hereunder to make demands, to give notices,
to exercise or refrain from exercising any rights, and to take or refrain from
taking any action (including, without limitation, the release or substitution of
the Mortgaged Property) in accordance with the terms of the Collateral Trust
Agreement and this Deed of Trust.

 

(b) Beneficiary shall at all times be the same Person or Persons that comprise
the Collateral Trustee under the Collateral Trust Agreement. Written notice of
resignation by Collateral Trustee pursuant to the Collateral Trust Agreement
shall also constitute notice of resignation as Collateral Trustee under this
Deed of Trust. Removal of Collateral Trustee pursuant to any provision of the
Collateral Trust Agreement shall also constitute removal as Collateral Trustee
under this Deed of Trust. Appointment of a successor Collateral Trustee pursuant
to the Collateral Trust Agreement shall also constitute appointment of a
successor Collateral Trustee under this Deed of Trust. Upon the acceptance of
any appointment as Collateral Trustee by a successor Collateral Trustee under
the Collateral Trust Agreement, that successor Collateral Trustee shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring or removed Collateral Trustee as the Beneficiary
under this Deed of Trust, and the retiring or removed Collateral Trustee shall
promptly (i) assign and transfer to such successor Collateral Trustee all of its
right, title and interest in and to this Deed of Trust and the Mortgaged
Property, and (ii) execute and deliver to such successor Collateral Trustee such
assignments and amendments and take such other actions, as may be necessary or
appropriate in connection with the assignment to such successor Collateral
Trustee of the liens and security interests created hereunder, whereupon such
retiring or removed Collateral Trustee shall be discharged from its duties and
obligations under this Deed of Trust. After any retiring or removed Collateral
Trustee’s resignation or removal hereunder as Collateral Trustee, the provisions
of this Deed of Trust and the Collateral Trust Agreement shall inure to its
benefit as to any actions taken or omitted to be taken by it under this Deed of
Trust while it was Collateral Trustee hereunder.

 

[The remainder of this page has been intentionally left blank]

 

S-17

--------------------------------------------------------------------------------

EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

Section 8.14 WAIVER OF TRIAL BY JURY.

 

GRANTOR AND BENEFICIARY EACH WAIVES THE RIGHT TO A TRIAL BY JURY IN ANY ACTION
OR PROCEEDING BASED UPON OR RELATED TO THE SUBJECT MATTER OF THIS DEED OF TRUST
OR THE COLLATERAL TRUST AGREEMENT, OR ANY OF THE OTHER SECURITY DOCUMENTS, OR
ANY OF THE TRANSACTIONS RELATED TO ANY OF THE SECURED DEBT. THIS WAIVER IS
KNOWINGLY, INTENTIONALLY AND VOLUNTARILY MADE BY GRANTOR AND BENEFICIARY, AND
GRANTOR AND BENEFICIARY EACH ACKNOWLEDGES THAT NEITHER THE OTHER NOR ANY PERSON
ACTING ON BEHALF OF THE OTHER HAS OR HAVE MADE ANY REPRESENTATIONS OF FACT TO
INDUCE THIS WAIVER OF TRIAL BY JURY OR IN ANY WAY TO MODIFY OR NULLIFY ITS
EFFECT. GRANTOR AND BENEFICIARY EACH FURTHER ACKNOWLEDGES THAT IT HAS BEEN
REPRESENTED (OR HAS HAD THE OPPORTUNITY TO BE REPRESENTED) IN THE SIGNING OF
THIS AGREEMENT AND IN THE MAKING OF THIS WAIVER BY INDEPENDENT LEGAL COUNSEL
SELECTED OF ITS OWN FREE WILL AND THAT IT HAS HAD THE OPPORTUNITY TO DISCUSS
THIS WAIVER WITH COUNSEL. GRANTOR AND BENEFICIARY EACH AGREES THAT THE SECURED
DEBT ARE EXEMPTED TRANSACTIONS UNDER THE TRUTH-IN-LENDING ACT, 15 U.S.C. SECTION
1601, ET SEQ.

 

Initials of Grantor:

 

_____________

 

[The remainder of this page has been intentionally left blank]

 

S-18

--------------------------------------------------------------------------------

EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

ARTICLE 9

THE TRUSTEE

 

Section 9.1 Right of Beneficiary to Substitute Trustee. Beneficiary shall have
the irrevocable power, to be exercised at any time and from time to time
hereafter with or without cause, to substitute a trustee or trustees in place of
the Trustee herein named by an instrument in writing duly executed, acknowledged
and recorded among the land records of the jurisdiction where the Mortgaged
Property is located, and when such instrument is so recorded, all the estate of
the Trustee thus superseded shall terminate, and all the right, title and
interest of such Trustee hereunder shall be vested in the trustee named as
successor, and such successor trustee shall have the same powers, rights and
duties which the Trustee so superseded had under this Deed of Trust. The
exercise of this right to appoint a successor trustee, no matter how often
exercised, shall not be deemed an exhaustion of said right. Beneficiary shall
have the right to name one or more entities as a successor trustee hereunder. If
there is more than one Trustee named herein, any one Trustee shall have the full
right and authority to act for and on behalf of all such Trustees.

 

Section 9.2 Trustee’s Covenants. Trustee, by acceptance hereof, covenants
faithfully to perform and fulfill the trusts herein created, being liable,
however, only for gross negligence or intentional misconduct, and hereby waives
any statutory fee.

 

Section 9.3 Right of Trustee to Resign. The Trustee may resign at any time upon
giving ten (10) days’ notice in writing to Grantor and to Beneficiary.

 

Section 9.4 Ratification of Acts. Beneficiary hereby ratifies and confirms any
and all acts which the herein-named Trustee, or its successor or successors in
this trust, shall do lawfully by virtue hereof. Grantor hereby agrees, on behalf
of itself and of its heirs, executors, administrators, successors and assigns,
that the recitals contained in any deed or deeds executed in due form by any
Trustee or substitute trustee, acting under the provisions of this instrument,
shall be prima facie evidence of the facts recited, and that it shall not be
necessary to prove in any court, otherwise than by such recitals, the existence
of the facts essential to authorize the execution and delivery of such deed or
deeds and the passing of title thereby.

 

Section 9.5 Additional Matters. Trustee shall not be required to see that this
Deed of Trust is recorded, or be liable for its validity or its priority as a
first deed of trust, or otherwise, nor shall Trustee be answerable or
responsible for performance or observance of the covenants and agreements
imposed upon Grantor or Beneficiary by this Deed of Trust or any other
agreement. Trustee shall not be required to post any bond in connection with the
performance of its duties unless required by Beneficiary, and Grantor expressly
waives its right to require the posting of any bond. Trustee as well as
Beneficiary shall have authority in their respective discretion to employ agents
and attorneys in the execution of this trust and to protect the interest of
Beneficiary hereunder; and to the extent permitted by law, they shall be
compensated, and all expenses relating to the employment of such agents and/or
attorneys, including expenses of litigation, shall be paid out of the proceeds
of the sale of the Mortgaged Property conveyed hereby should a sale be had, but
if no such sale be had, all sums so paid out shall be recoverable to the extent
permitted by law by all remedies at law or in equity by which the indebtedness
hereby secured may be recovered.

 

[The remainder of this page has been intentionally left blank]

 

S-19

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EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

IN WITNESS WHEREOF, Grantor has on the date set forth in the acknowledgement
hereto, effective as of the date first above written, caused this instrument to
be duly EXECUTED AND DELIVERED by authority duly given.

 

GRANTOR:   By:        

Name:

   

Title:

Attest:        

Name:

   

Title:

 

[Section 8.14 must be initialed]

 

S-20

--------------------------------------------------------------------------------

EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

COMMONWEALTH OF PENNSYLVANIA   )     ) ss.: COUNTY OF ALLEGHENY   )

 

I,                                                                      , a
Notary Public of said County, do certify that
                                                 ,                             
of                                         , who signed the Credit Line Deed of
Trust, Security Agreement, Assignment of Rents and Leases, Financing Statement
and Fixture Filing hereto annexed, bearing date the 14th day of June, 2004, for
said limited liability company, has this day in my said County, before me,
acknowledged the said Credit Line Deed of Trust, Security Agreement, Assignment
of Rents and Leases, Financing Statement and Fixture Filing, to be the act and
deed of said                                          .

 

Given under my hand this 14th day of June, 2004.

 

Notary Public for the State of Pennsylvania

 

My Commission expires:                                                 ]

 

N-1

--------------------------------------------------------------------------------

EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

EXHIBIT A

 

LEASES COMPRISING HYDROCARBON PROPERTY

 

[See Attached Page(s) For Legal Description]

 

--------------------------------------------------------------------------------

EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

EXHIBIT B

 

DESCRIPTION OF THE PIPELINES

 

[See Attached Page(s) For Legal Description]

 

--------------------------------------------------------------------------------

EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

EXHIBIT C

 

WELLS COMPRISING HYDROCARBON PROPERTY

 

[See Attached Page(s) For Legal Description]

 

NONE

 

--------------------------------------------------------------------------------

EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

EXHIBIT D

 

MAP OF THE PIPELINES

 

[See Attached Page(s) For Legal Description]

 

--------------------------------------------------------------------------------

EXHIBIT 1.1(D)(1)

 

FORM OF DEED OF TRUST (OIL AND GAS - PIPELINE)

 

TEMPLATE FOR WEST VIRGINIA, CERTAIN STATE-SPECIFIC CHANGES

WILL BE MADE AS APPLICABLE FOR OTHER JURISDICTIONS

 

SCHEDULE 1

 

Name of Grantor

--------------------------------------------------------------------------------

 

State of Incorporation

--------------------------------------------------------------------------------

 

Employer ID#

--------------------------------------------------------------------------------

   Organization ID#

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

Exhibit 1.1(D)(2)

 

Tax Parcel ID No.: 0366071100800

 

INDEMNITY DEED OF TRUST,

SECURITY AGREEMENT, ASSIGNMENT OF RENTS

AND LEASES, FINANCING STATEMENT AND FIXTURE FILING (MARYLAND)

 

by and from

 

CNX MARINE TERMINALS, INC.,

“Grantor”

to

 

GLENN P. HARE

“Trustee”

 

for the benefit of

 

not in his individual capacity, but solely as Collateral Trustee, pursuant to
that certain Collateral Trust Agreement dated as of June 30, 2004, for the
benefit of (i) the Collateral Trustees (as defined in such Collateral Trust
Agreement), (ii) the Lenders under the Credit Agreement, (iii) the holders of
the Senior Notes (1991) and the Senior Notes (2002), and (iv) any other Persons
from time to time holders of the Secured Debt (as all such terms are hereinafter
defined) “Beneficiary”

 

Dated June 14, 2004, effective June 30, 2004

 

Dated as of June 30, 2004

 

   

Location:

Municipality:

County:

State:

 

3800 Newgate Avenue

Baltimore

Baltimore

Maryland

   

 

GRANTOR IS NOT PRIMARILY LIABLE FOR THE PAYMENT OF THE INDEBTEDNESS EVIDENCED BY
THE NOTES.

 

THE MAXIMUM ORIGINAL PRINCIPAL AMOUNT OF INDEBTEDNESS SECURED BY THIS DEED OF
TRUST IS ONE BILLION DOLLARS ($1,000,000,000), PLUS ALL INTEREST, COSTS,
EXPENSES AND ADVANCES MADE HEREUNDER.

 

THIS IS AN INDEMNITY DEED OF TRUST SECURING A THIRD PARTY GUARANTEE OF REPAYMENT
OF CERTAIN LOANS AND EXTENSIONS OF CREDIT. NO MARYLAND RECORDATION TAX IS
PRESENTLY DUE PURSUANT TO SECTION 12-105(f), TAX PROPERTY ARTICLE, ANNOTATED
CODE OF MARYLAND, AS AMENDED

 

NOTE TO RECORDER: THIS INDEMNITY DEED OF TRUST CONSTITUTES A FIXTURE FILING AND
COVERS AS-EXTRACTED COLLATERAL UNDER THE UCC (AS DEFINED HEREIN) AND IS TO BE
CROSS-REFERENCED IN THE UCC RECORDS.

 

THE SECURED PARTY (BENEFICIARY) DESIRES THIS FIXTURE FILING AND FINANCING
STATEMENT COVERING AS-EXTRACTED COLLATERAL TO BE INDEXED AGAINST THE RECORD
OWNER OF THE REAL ESTATE DESCRIBED HEREIN.

 

After Recording, the Recorder is requested to return this Deed of Trust to:

 

Buchanan Ingersoll PC

301 Grant Street, 20th Floor

One Oxford Centre

Pittsburgh, PA 15219-1410

Attention: Michael A. Donadee, Esq.

 

--------------------------------------------------------------------------------

INDEMNITY DEED OF TRUST, SECURITY AGREEMENT, ASSIGNMENT OF RENTS

AND LEASES, FINANCING STATEMENT AND FIXTURE FILING (MARYLAND)

 

THIS INDEMNITY DEED OF TRUST, SECURITY AGREEMENT, ASSIGNMENT OF RENTS AND
LEASES, FINANCING STATEMENT AND FIXTURE FILING (this “Deed of Trust”) is made
and executed the 14th day of June, 2004, to be delivered and effective June 30,
2004, and is made and delivered by CNX MARINE TERMINALS INC., a Delaware
corporation, whose address is c/o Consol Energy Inc., CONSOL Plaza, 1800
Washington Road, Pittsburgh, Pennsylvania 15241 (“Grantor”), to GLENN P. HARE,
an individual, having an address at Steptoe & Johnson, PLLC, 4 Barrow Court,
Towson, Maryland 21204 (“Trustee”), for the benefit of DAVID A. VANASKEY, as
Collateral Trustee pursuant to that certain Collateral Trust Agreement dated as
of June             , 2004, for the benefit of (i) the Collateral Trustees, (ii)
the Lenders under the Credit Agreement, (iii) the holders of the Senior Notes
(1991) and the Senior Notes (2002), and (iv) any other Persons from time to time
holders of the Secured Debt (in such capacity, together with any successor or
assign, “Collateral Trustee”), having an address c/o Wilmington Trust Company,
1100 North Market Street, Rodney Square North, Wilmington, DE 19890 (Collateral
Trustee, together with its successors and assigns, “Beneficiary”).

 

Notices pursuant to this Deed of Trust shall be delivered to:

 

David A. Vanaskey, as Collateral Trustee

c/o Wilmington Trust Company

Rodney Square North

1100 North Market Street

Wilmington, DE 19890

Phone: (302) 636-6019

Telecopy: (302) 636-4143

 

THE MAXIMUM ORIGINAL PRINCIPAL AMOUNT OF INDEBTEDNESS SECURED BY THIS DEED OF
TRUST IS ONE BILLION DOLLARS ($1,000,000,000), PLUS ALL INTEREST, COSTS,
EXPENSES AND ADVANCES MADE HEREUNDER.

 

THIS IS AN INDEMNITY DEED OF TRUST SECURING A THIRD PARTY GUARANTEE OF REPAYMENT
OF CERTAIN LOANS AND EXTENSIONS OF CREDIT. NO MARYLAND RECORDATION TAX IS
PRESENTLY DUE PURSUANT TO SECTION 12-105(f), TAX PROPERTY ARTICLE, ANNOTATED
CODE OF MARYLAND, AS AMENDED

 

ARTICLE 1

DEFINITIONS

 

Section 1.1 Use of Capitalized Terms. All capitalized terms used herein without
definition shall have the respective meanings ascribed to them in the Credit
Agreement.

 

Section 1.2 Definitions. The following terms used in this Deed of Trust shall
have the meanings set forth:

 

(a) “Actionable Default”: means (i) an “Event of Default” under and as defined
by the Credit Agreement; (ii) an event of default under the Public Indenture; or
(iii) an event of default under the Issuing and Paying Agency Agreement; or (iv)
a default under the terms of the Collateral Trust Agreement; or (v) Grantor
shall at any time deliver or cause to be delivered to Beneficiary a notice
pursuant to Section 55-58.2 of the Code of Virginia (1950), as amended, to the
Collateral Trustee.

 

(b) “Bank” shall mean PNC Bank, National Association, in its individual
capacity.

 

(c) “Borrower”: shall mean Consol Energy Inc., a Delaware corporation.

 

--------------------------------------------------------------------------------

(d) “Collateral Trust Agreement”: shall mean that certain Collateral Trust
Agreement, dated as of June 30, 2004, by and among the Collateral Trustee
herein, as Individual Trustee thereunder, Wilmington Trust Company, a Delaware
banking corporation, not in its individual capacity but solely as corporate
trustee, as Corporate Trustee thereunder, the Borrower, and the Guarantors,
including without limitation, Grantor, as the same may hereafter be modified,
amended, restated, supplemented, refinanced or replaced from time to time.

 

(e) “Credit Agreement”: That certain Credit Agreement dated as of June 30, 2004
by and among Borrower, PNC Bank, National Association, Citicorp North America,
Inc., as Co-Administrative Agents, Credit Facility Agent, LaSalle Bank National
Association, Société Générale, New York Branch and SunTrust Bank, each in its
capacity as a co-documentation agent, the Lenders described therein, the
Guarantors party thereto, and Citigroup Global Markets Inc. and PNC Capital
Markets, Inc., as Joint Lead Arrangers, as the same may be amended, amended and
restated, supplemented, modified or replaced from time to time, to the extent
the same shall be in effect.

 

(f) “Credit Facility Agent”: shall mean PNC Bank, National Association, as
Paying Agent under the Credit Agreement.

 

(g) “Guarantors”: shall mean all Subsidiaries of the Borrower other than
Excluded Subsidiaries.

 

(h) “Issuing and Paying Agency Agreement”: means the Issuing and Paying Agency
Agreement, dated as of December 31, 1991, among the Borrower, Consolidation Coal
Company, CONSOL Inc. and The Bank of Nova Scotia Trust Company of New York (as
successor paying agent to JP Morgan Chase Bank), delivered with respect to the
Senior Notes (1991), as further amended, modified, supplemented, extended,
restated, renewed or replaced from time to time.

 

(i) “Lenders”: shall mean those financial institutions from time to time
identified as Lenders pursuant to the Credit Agreement, and their respective
successors and assigns.

 

(j) “Loan Parties” shall mean Borrower, Grantor and the other Guarantors.

 

(k) “Mortgaged Property”: All of Grantor’s right, title and interest in and to
(1) the fee interests in the real property described in Exhibit A attached
hereto and incorporated herein, by this reference, or, to the extent applicable,
the fee interest in the surface of such real property, in each case together
with any greater estate therein as hereafter may be acquired by Grantor (the
“Owned Land”), (2) the leasehold interest in the real property demised pursuant
to the agreements described on Exhibit B hereto and incorporated herein by this
reference (as such agreements may be amended, amended and restated, supplemented
or otherwise modified from time to time, each such agreement, a “Mortgaged
Lease” and collectively the “Mortgaged Leases”), together with any greater
estate therein as hereafter may be acquired by Grantor (the “Leased Land”, the
Owned Land and the Leased Land are sometimes referred to herein collectively as
the “Land”), (3) all minerals owned by Grantor or leased to Grantor (whether
pursuant to the Mortgaged Leases or otherwise) and located upon, under and in
the Land (including, without limitation, coal, oil, gas and other solid, liquid
and gaseous hydrocarbons as well as limestone included within the Land in place
and as produced and extracted), and all rights, privileges, titles and interests
appurtenant and relating thereto and in connection therewith (including, without
limitation, rights, privileges, titles and interests for the development,
production, extraction, processing, treatment, storage, transportation and sale
and other disposition of minerals and all contracts and other agreements
relating to such activities as well as all accounts, accounts receivable,
contract rights, other rights to the payments of monies, chattel paper and
general intangibles arising from or relating to such activities) (collectively,
the “Mineral Interests”), (4) all improvements now owned or hereafter acquired
by Grantor, now or at any time situated, placed or constructed upon the Land
(the “Improvements”; the Land and Improvements are collectively referred to as
the “Premises”), (5) all materials, supplies, equipment, apparatus and other
items of personal property now owned or hereafter acquired by Grantor and now or
hereafter attached to or installed in any of the Improvements or the Land, and
water, gas, electrical, telephone, storm and sanitary sewer facilities and all
other utilities whether or not situated in easements (the “Fixtures”), (6) all
goods, accounts, general intangibles, instruments, documents, chattel paper and
all other personal property of any kind or character, including such items of
personal property as defined in the UCC (defined below), now owned or hereafter
acquired by Grantor and now or hereafter affixed to, placed upon, used in

 

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connection with, raising from or otherwise related to the Premises (the
“Personalty”), (7) all reserves, escrows or impounds required under the Security
Documents and all deposit accounts maintained by Grantor with respect to the
Mortgaged Property (the “Deposit Accounts”), (8) all leases, licenses,
concessions, occupancy agreements or other agreements (written or oral, now or
at any time in effect) which grant to any Person, other than Grantor, a
possessory interest in, or the right to use, all or any part of the Mortgaged
Property, together with all related security and other deposits (the “Leases”),
(9) all of the rents, revenues, royalties, income, proceeds, profits, security
and other types of deposits, and other benefits paid or payable by parties to
the Leases for using, leasing, licensing possessing, operating from, residing
in, selling or otherwise enjoying the Mortgaged Property, (the “Rents”), (10)
all other agreements, such as construction contracts, architects’ agreements,
engineers’ contracts, utility contracts, maintenance agreements, management
agreements, service contracts, listing agreements, guaranties, warranties, all
permits (subject to any required regulatory approval), licenses, certificates
and entitlements in any way relating to the construction, use, occupancy,
operation, maintenance, enjoyment or ownership of the Mortgaged Property (the
“Permits”), (11) all rights, privileges, tenements, hereditaments,
rights-of-way, easements, appendages and appurtenances appertaining to the
foregoing, (12) all property tax refunds payable with respect to the Mortgaged
Property (the “Tax Refunds”), (13) all accessions, replacements and
substitutions for any of the foregoing and all proceeds thereof (the
“Proceeds”), (14) all insurance policies, unearned premiums therefor and
proceeds from such policies covering any of the above property now or hereafter
acquired by Grantor (the “Insurance”), and (15) all awards, damages,
remunerations, reimbursements, settlements or compensation heretofore made or
hereafter to be made by any governmental authority pertaining to any
condemnation or other taking (or any purchase in lieu thereof) of all or any
portion of the foregoing property rights and interests (the “Condemnation
Awards”). As used in this Deed of Trust, the term “Mortgaged Property” shall
mean all or, where the context permits or requires, any portion of the above or
any interest therein. Notwithstanding the foregoing or anything to the contrary
contained in this Deed of Trust, the terms “Mortgaged Property”, “Land”,
“Mineral Interests”, “Improvements”, “Premises”, “Fixtures”, “Leases”, “Rents”,
“Personalty”, “Permits”, “Proceeds”, “Insurance” and “Condemnation Awards” shall
apply only to the extent of Grantor’s interests therein. Notwithstanding
anything set forth in this subsection, or elsewhere in this Deed of Trust, the
Mortgaged Property shall not include, and shall specifically exclude, any
enclosed buildings, structures and improvements located on the Land (all of
which are referred to in this Deed of Trust as the “Excluded Structures”).

 

(l) “Permitted Liens”: “Permitted Liens”: Collectively, liens permitted under
the Credit Agreement, including any lessor liens retained or otherwise existing
pursuant to any of the Leases, together with all other matters of title
disclosed to Credit Facility Agent in letters of counsel delivered in connection
with the negotiation, execution and delivery of this Deed of Trust.

 

(m) “Person”: shall mean any individual, corporation, partnership, limited
liability company, association, joint-stock company, trust, unincorporated
organization, joint venture, government or political subdivision or agency
thereof, or any other entity.

 

(n) “Public Indenture”: means the Indenture, dated March 7, 2002, as amended by
the First Supplemental Indenture, dated March 7, 2002, as amended by the Second
Supplemental Indenture, dated September 30, 2003, and as further amended,
modified, supplemented, extended, restated, renewed or replaced from time to
time, by and among the Borrower, certain subsidiaries of the Borrower, and the
Public Trustee, as trustee, providing for the issuance of $250 million 7.875%
senior unsecured notes due March 1, 2012.

 

“Secured Debt”: (1) All fees, expenses and charges, including, without
limitation, indemnification, reimbursement or contribution obligations of the
Loan Parties to the Collateral Trustees, under (and as defined in) the
Collateral Trust Agreement; (2) all indebtedness and all other Obligations of
Grantor or any of the other Loan Parties to Credit Facility Agent or any of the
other Lenders under the Credit Agreement or any of the other Security Documents,
including, without limitation, (A) Revolving Credit Loans, evidenced by certain
Revolving Credit Notes, pursuant to the Credit Agreement, in an aggregate amount
not to exceed the sum of Four Hundred Million Dollars ($400,000,000), which
Revolving Credit Loans include, without limitation, Swing Loans made by Bank to
Borrower, evidenced by a certain Swing Loan Note, delivered by Borrower to Bank,
made pursuant to the Credit Agreement, in an amount not to exceed the sum of
Twenty Five Million Dollars ($25,000,000), (B) all of the reimbursement
obligations of Borrower and any Loan Party with respect to the Tranche B Letters
of Credit issued pursuant to the Credit Agreement, in an aggregate undrawn face
amount not to exceed the sum of Two Hundred Million Dollars ($200,000,000),
further including, without limitation, (C) obligations and

 

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liabilities of any nature now or hereafter existing under or arising in
connection with any Revolving Letters of Credit, including, without limitation,
the reimbursement obligations in respect thereof, together with interest and
other amounts payable with respect thereto, and (F) all Obligations and other
liabilities of any nature now or hereafter existing under any Specified Swap
Agreement; (3) all indebtedness of Grantor or any of the other Loan Parties
existing pursuant to the Senior Notes (1991) in an aggregate amount of
Forty-Five Million Dollars ($45,000,000); and (3) all indebtedness of Grantor or
any of the other Loan Parties existing pursuant to the Senior Notes (2002), in
an aggregate amount of Two Hundred Fifty Million Dollars ($250,000,000).

 

(o) “Security Documents”: shall mean the Credit Agreement, the Credit Facility
Agent’s Letter, the Guaranty Agreement, the Indemnity, the Intercompany
Subordination Agreement, the Mortgages and Deeds of Trust, the Notes, the
Patent, Trademark and Copyright Assignment, the Pledge Agreement, the Security
Agreement, any Specified Swap Agreements and any other instruments, certificates
or documents delivered or contemplated to be delivered hereunder or thereunder
or in connection herewith or therewith, as the same may be supplemented,
amended, extended, renewed or replaced from time to time in accordance herewith
or therewith, and Security Document shall mean any of the Security Documents.

 

(p) “Senior Notes (1991)”: shall mean the outstanding aggregate $45 million
principal amount of 8.25% notes due 2007, of the Borrower, issued pursuant to
the Issuing and Paying Agency Agreement.

 

(q) “Senior Notes (2002)”: shall mean an aggregate $250,000,000 principal amount
of 7.875% notes due 2012, issued pursuant to the Public Indenture.

 

(r) “UCC”: The Uniform Commercial Code of Maryland or, if the creation,
perfection and enforcement of any security interest herein granted is governed
by the laws of a state other than the State of Maryland, then, as to the matter
in question, the Uniform Commercial Code in effect in that state.

 

ARTICLE 2

GRANT

 

Section 2.1 Grant. To secure the full and timely payment and performance of the
Secured Debt, Grantor MORTGAGES, GRANTS, BARGAINS, ASSIGNS, SELLS, CONVEYS and
CONFIRMS, to Trustee, the Mortgaged Property, subject, however, only to
Permitted Liens, TO HAVE AND TO HOLD the Mortgaged Property, IN TRUST, WITH
POWER OF SALE. Grantor does hereby bind itself, its successors and assigns to
WARRANT AND FOREVER DEFEND the title to the Mortgaged Property described on
Exhibit A unto Beneficiary.

 

Provided further, subject to the terms hereof and of the Credit Agreement and
the other Security Documents, until an Event of Default shall occur, Grantor
shall have and possess the full right and privilege to own, lease, operate,
manage and control the Mortgaged Property in all respects, to extract the
Mineral Interests therefrom, and to do all other matters and things that Grantor
deems necessary, desirable or appropriate thereon and therewith.

 

ARTICLE 3

WARRANTIES, REPRESENTATIONS AND COVENANTS

 

Grantor warrants, represents and covenants to Beneficiary as follows:

 

Section 3.1 Title to Mortgaged Property and Lien of this Instrument. With
respect to the property identified at Exhibit A and Exhibit B hereto, Grantor
owns, or has valid leasehold rights to, the Mortgaged Property free and clear of
any liens, claims or interests, except for Permitted Liens, or matters disclosed
in title opinions delivered to Beneficiary by counsel to Grantor
contemporaneously herewith, and this Deed of Trust creates valid, enforceable
first priority liens and security interests against the Mortgaged Property
identified at Exhibit A and Exhibit B. Adverse matters of title that are known
to Grantor and which are material to the continuing business

 

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operations of Grantor are disclosed on the Exhibits, where applicable. If
adverse matters of title which are material to the continuing business
operations of Grantor arise at any future time during which this Deed of Trust
remains in force, Grantor will promptly advise Credit Facility Agent in writing
as to such matters.

 

Section 3.2 First Lien Status. Except for Permitted Liens, Grantor shall
preserve and protect the first lien and security interest status of this Deed of
Trust. If any lien or security interest other than a Permitted Lien is asserted
against the Mortgaged Property, Grantor shall promptly, and at its expense, (a)
give Beneficiary a detailed written notice of such lien or security interest
(including origin, amount and other terms), and (b) pay the underlying claim in
full or take such other action so as to cause it to be released or contest the
same in compliance with the requirements of the Credit Agreement and the
Collateral Trust Agreement (including the requirement of providing a bond or
other security satisfactory to Beneficiary).

 

Section 3.3 Payment and Performance. Grantor shall pay and perform the Secured
Debt in a timely manner, when required, and in material compliance with all
terms, covenants and conditions applicable thereto.

 

Section 3.4 Replacement of Fixtures. Subject to the terms of the Collateral
Trust Agreement and the Credit Agreement, Grantor shall not, without the prior
written consent of Beneficiary, permit any of the Fixtures owned or leased by
Grantor to be removed at any time from the Land or Improvements, unless the
removed item is removed temporarily for maintenance and repair or is permitted
to be so removed, or is not material to Grantor’s continuing business
operations.

 

Section 3.5 Inspection. Grantor shall permit Beneficiary, Credit Facility Agent,
and their respective agents, representatives and employees, upon reasonable
prior notice to Grantor, to inspect the Mortgaged Property and all books and
records of Grantor located thereon, as provided in the Credit Agreement,
provided that such right shall, with respect to Leased Land, be subject to the
provisions of any applicable Mortgaged Lease.

 

Section 3.6 Insurance; Condemnation Awards and Insurance Proceeds.

 

(a) Insurance. Grantor shall maintain or cause to be maintained, with respect to
the Mortgaged Property, insurance against loss or damage, as required pursuant
to the terms of the Credit Agreement. If any portion of an enclosed structure
now or hereafter located on the Mortgaged Property is located in an area
identified by the Federal Emergency Management Agency as an area having special
flood hazards and in which flood insurance has been made available under the
National Flood Insurance Act of 1968 (or any amendment or successor act
thereto), then Grantor shall maintain, or cause to be maintained, with a
financially sound and reputable insurer, flood insurance in an amount sufficient
to comply with all applicable rules and regulations promulgated pursuant to such
Act.

 

(b) Condemnation Awards. Subject to the provisions of any applicable Mortgaged
Lease, and also subject to the terms of the Credit Agreement applicable to
proceeds payable as the result of a Casualty Event, Grantor assigns all
Condemnation Awards to Beneficiary and authorizes Beneficiary to collect and
receive such Condemnation Awards and to give proper receipts and acquittances
therefor, subject to the terms of the Collateral Trust Agreement.

 

(c) Insurance Proceeds. Subject to the provisions of any applicable Mortgaged
Lease, and further subject to the terms of the Credit Agreement applicable to
proceeds payable as the result of a Casualty Event, Grantor assigns to
Beneficiary all proceeds of any insurance policies insuring against loss or
damage to the Mortgaged Property. Subject to the terms of the Credit Agreement,
and any applicable Mortgaged Lease, Grantor authorizes Beneficiary to collect
and receive such proceeds and authorizes and directs the issuer of each of such
insurance policies to make payment for all such losses directly to Beneficiary,
instead of to Grantor and Beneficiary jointly.

 

Section 3.7 Excluded Structures. Notwithstanding anything else contained herein,
this Deed of Trust shall not be construed to encumber in any manner the Excluded
Structures, which shall for all purposes

 

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hereof be deemed to constitute personal property separate from the Land, all of
which shall remain the property of Grantor.

 

ARTICLE 4

LEASEHOLD DEED OF TRUST PROVISIONS

 

Section 4.1 Representations; Warranties; Covenants. Grantor hereby represents,
warrants and covenants that, with respect to Mortgaged Leases that are material
to Grantor’s continuing business operations:

 

(a) Representations of Grantor. To the knowledge of Grantor, (1) such Mortgaged
Leases are unmodified and in full force and effect, (2) all rent and other
charges therein have been paid to the extent they are payable to the date
hereof, (3) Grantor enjoys the quiet and peaceful possession of such Premises,
(4) Grantor is not in default under any of the terms thereof and there are no
circumstances which, with the passage of time or the giving of notice or both,
would constitute an event of default thereunder, (5) the lessor thereunder is
not in default under any of the terms or provisions thereof on the part of the
lessor to be observed or performed;

 

(b) Payment of Rents. Grantor shall promptly pay, when due and payable, the rent
and other charges payable pursuant to such Mortgaged Lease, and will timely
perform and observe, in all material respects, all of the other terms, covenants
and conditions required to be performed and observed by Grantor as lessee under
any Mortgaged Lease;

 

(c) Notice of Default. Grantor shall notify Beneficiary in writing of any
default by Grantor in the performance or observance of any terms, covenants or
conditions on the part of Grantor to be performed or observed under such
Mortgaged Lease within three (3) days after Grantor obtains knowledge of such
default; Grantor shall, immediately upon receipt thereof, deliver a copy of each
written notice given to Grantor by the lessor pursuant to any Mortgaged Lease
and promptly notify Beneficiary in writing of any material default by the lessor
in the performance or observance of any of the terms, covenants or conditions on
the part of the lessor to be performed or observed thereunder;

 

(d) No Termination. Unless required under the terms of any Mortgaged Lease,
Grantor shall not, without the prior written consent of Beneficiary (which
consent will not be unreasonably withheld, conditioned or delayed) terminate,
modify or surrender any such Mortgaged Lease, and any such attempted
termination, modification or surrender without such consent shall be void; and

 

(e) Estoppel. Grantor shall, within thirty (30) days after written request from
Beneficiary, use its reasonable efforts to obtain from the lessor and deliver to
Beneficiary a certificate setting forth the name of the tenant under any
Mortgaged Lease and stating that such Mortgaged Lease is in full force and
effect, is unmodified or, if such Mortgaged Lease has been modified, the date of
each modification (together with copies of each such modification), that no
notice of termination thereof has been served on Grantor, stating that no
default or event which with notice or lapse of time (or both) would become a
default is existing under, such Mortgaged Lease (or if any such default or event
is existing, specifying the nature of such default or event), stating the date
to which rent has been paid, and containing such other statements and
representations as may be requested by Beneficiary.

 

Section 4.2 No Merger. So long as any of the Secured Debt remains unpaid or
unperformed, the fee title to and the leasehold estate in the Premises subject
to any Mortgaged Lease shall not merge but shall always be kept separate and
distinct notwithstanding the union of such estates in the lessor or Grantor, or
in a third party, by purchase or otherwise. If Grantor acquires the fee title or
any other estate, title or interest in the Premises, or any part thereof, the
lien of this Deed of Trust shall attach to, cover and be a lien upon such
acquired estate, title or interest and the same shall thereupon be and become a
part of the Mortgaged Property with the same force and effect as if specifically
encumbered herein. Grantor agrees to execute all instruments and documents that
Beneficiary or Trustee may reasonably require to ratify, confirm and further
evidence the lien of this Deed of Trust on the acquired estate, title or
interest. Furthermore, Grantor hereby appoints Beneficiary as its true and
lawful attorney-in-fact to execute and deliver, following an Actionable Default,
all such instruments and documents in the

 

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name and on behalf of Grantor. This power, being coupled with an interest, shall
be irrevocable as long as any portion of the Secured Debt remains unpaid.

 

Section 4.3 Beneficiary as Lessee. If any Mortgaged Lease, that is material to
the continuing business operations of Grantor, shall be terminated prior to the
natural expiration of its term due to default by Grantor or any tenant
thereunder, and if, pursuant to the provisions of such Mortgaged Lease,
Beneficiary or its designee shall acquire from the lessor a new lease of the
Premises, Grantor shall have no right, title or interest in or to such new lease
or the leasehold estate created thereby, or renewal privileges therein
contained.

 

Section 4.4 No Assignment. Notwithstanding anything to the contrary contained
herein, this Deed of Trust shall not constitute an assignment of any Mortgaged
Lease within the meaning of any provision thereof prohibiting its assignment and
Beneficiary shall have no liability or obligation thereunder by reason of its
acceptance of this Deed of Trust. Beneficiary shall be liable for the
obligations of the tenant arising out of any Mortgaged Lease for only that
period of time for which Beneficiary is in possession of the Premises or has
acquired, by foreclosure or otherwise, and is holding all of Grantor’s right,
title and interest therein.

 

Section 4.5 Required Landlord Consents. Notwithstanding anything to the contrary
contained in this Deed of Trust, to the extent that the assignment, transfer or
conveyance of, or granting of a Lien or security interest in, any part of the
Mortgaged Property by Grantor to Beneficiary under this Deed of Trust is
prohibited by the terms of the instrument, contract or agreement evidencing or
creating the Mortgaged Property, or would result in a breach or default by
Grantor thereunder, or the termination thereunder, in each case due to the
granting of a lien or security interest therein, the Mortgaged Property shall
not include, and shall exclude, such instrument, contract or agreement,
including, but not limited to, the granting of a deed of trust lien against a
leasehold interest held by Grantor when the lease, by its terms, requires the
consent of the lessor to an effective assignment of the lessee’s leasehold
estate.

 

ARTICLE 5

DEFAULT AND FORECLOSURE

 

Section 5.1 Remedies. Upon the occurrence and during the continuance of an
Actionable Default, subject to the terms of the Collateral Trust Agreement, any
or all of the following rights, remedies and recourses may be exercised:

 

(a) Acceleration. Any holder of any portion of the Secured Debt may declare that
portion of the Secured Debt, or any portion thereof, to be immediately due and
payable, without further notice, presentment, protest, notice of intent to
accelerate, notice of acceleration, demand or action of any nature whatsoever
(each of which hereby is expressly waived by Grantor), whereupon the same shall
become immediately due and payable.

 

(b) Entry on Mortgaged Property. Subject to the provisions of any applicable
Mortgaged Lease and applicable law, Trustee or Beneficiary may enter the
Mortgaged Property and take exclusive possession thereof and of all books,
records and accounts relating thereto or located thereon. If Grantor remains in
possession of the Mortgaged Property following the occurrence and during the
continuance of an Actionable Default and without Beneficiary’s prior written
consent, subject to the provisions of any applicable Mortgaged Lease and
applicable law, Beneficiary may invoke any legal remedies to dispossess Grantor.

 

(c) Operation of Mortgaged Property. Subject to the provisions of any applicable
Mortgaged Lease, Trustee or Beneficiary may hold, lease, develop, manage,
operate or otherwise use the Mortgaged Property upon such terms and conditions
as Trustee or Beneficiary may deem reasonable under the circumstances
(including, without limitation, making such repairs, alterations, additions and
improvements and taking other actions, from time to time, as Trustee or
Beneficiary deem necessary or desirable), and apply all Rents and other amounts
collected by Trustee in connection therewith in accordance with the provisions
of Section 5.7.

 

(d) Foreclosure and Sale. Trustee may institute proceedings for the complete
foreclosure of this Deed of Trust, either by judicial action or by power of
sale. In the event Trustee elects to institute foreclosure

 

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proceedings upon the occurrence of an Actionable Default, Grantor assents to the
passage of a decree for the sale of the Mortgaged Property and further
authorizes Trustee to sell the Mortgaged Property, subject to the provisions of
any applicable Mortgaged Lease. Any sale of the Mortgaged Property, whether by
way of the assent to decree or power of sale, shall be made in accordance with
the provisions of Section 7-105, Real Property Article, Annotated Code of
Maryland, as amended, and Rules 14-101 et seq. of the Maryland Rules of
Procedure, as amended, or other applicable general or local laws of the State of
Maryland or judicial rules of procedure relating to the foreclosure of deeds of
trust. The terms of the sale may be cash upon settlement of the sale or upon
such other and additional terms as Trustee deems necessary, proper or
convenient, except as specifically limited by applicable law or court rule. Such
sale may be of the entire Mortgaged Property as a unit or of such parts or
parcels of the entire Mortgaged Property, as Trustee, in its sole and absolute
discretion, deems necessary, proper, or convenient. With respect to any notices
required or permitted under the UCC, Grantor agrees that ten (10) days’ prior
written notice shall be deemed commercially reasonable. At any such sale by
virtue of any judicial proceedings, power of sale, or any other legal right,
remedy or recourse, the title to and right of possession of any such property
shall pass to the purchaser thereof, and to the fullest extent permitted by law,
Grantor shall be completely and irrevocably divested of all of its right, tire,
interest, claim, equity, equity of redemption, and demand whatsoever, either at
law or in equity, in and to the property sold and such sale shall be a perpetual
bar both at law and in equity against Grantor, and against all other Persons
claiming or to claim the property sold or any part thereof, by, through or under
Grantor. Beneficiary, or Credit Facility Agent may be a purchaser at such sale
and if Beneficiary or Credit Facility Agent, as the case may be, is the highest
bidder, Beneficiary or such other party may credit the portion of the purchase
price that would be distributed to the Secured Debt pursuant to the Collateral
Trust Agreement. In the event this Deed of Trust is foreclosed by judicial
action, appraisement of the Mortgaged Property is waived.

 

(e) Receiver. Trustee or Beneficiary may make application to a court of
competent jurisdiction for, and obtain from such court as a matter of strict
right and without notice to Grantor or regard to the adequacy of the Mortgaged
Property for the repayment of the Secured Debt and/or the obligations of Grantor
under the Subsidiary Guaranty, the appointment of a receiver of the Mortgaged
Property, and Grantor irrevocably consents to such appointment. Any such
receiver shall have all the usual powers and duties of receivers in similar
eases, including the full power to rent, maintain and otherwise operate the
Mortgaged Property upon such terms as may be approved by the court, and in a
manner consistent with the terms of any applicable Mortgaged Lease, and shall
apply such Rents in accordance with the provisions of Section 5.7.

 

(f) Other Remedies. Subject to the provisions of any applicable Mortgaged Lease,
Trustee or Beneficiary may exercise all other rights, remedies and recourses
granted to Beneficiary with respect to all or any portion of the Secured Debt
pursuant to the terms of the Collateral Trust Agreement or the other Security
Documents, or otherwise available at law or in equity.

 

Section 5.2 Separate Sales. To the extent not prohibited under the terms of any
applicable Mortgaged Lease, the Mortgaged Property may be sold in one or more
parcels and in such manner and order as Beneficiary in its sole discretion may
elect. The right of sale arising out of any Actionable Default shall not be
exhausted by any one or more sales.

 

Section 5.3 Remedies Cumulative, Concurrent and Nonexclusive. Trustee and
Beneficiary shall have all rights, remedies and recourses with respect to the
enforcement of all or any portion of the Secured Debt granted pursuant to the
Collateral Trust Agreement and the other Security Documents, and available at
law or equity (including the UCC), which rights, (a) shall be cumulative and
concurrent, (b) may be pursued separately, successively or concurrently against
Grantor or others obligated for the payment or performance of the Secured Debt
or against the Mortgaged Property, or against any one or more of them, at the
sole discretion of Trustee or Beneficiary, as the case may be, (c) may be
exercised as often as occasion therefore shall arise, and the exercise or
failure to exercise any of them shall not be construed as a waiver or release
thereof or of any other right, remedy or recourse, and (d) are intended to be,
and shall be, nonexclusive. No action by Trustee or Beneficiary in the
enforcement of any rights, remedies or recourses relating to any portion of the
Secured Debt, or otherwise at law or equity shall be deemed to cure any
Actionable Default.

 

Section 5.4 Release of and Resort to Collateral. Subject to the terms of the
Collateral Trust Agreement, Beneficiary may release, regardless of consideration
and without the necessity for any notice to or consent by the holder of any
subordinate lien on the Mortgaged Property, any part of the Mortgaged Property

 

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without, as to the remainder, in any way impairing, affecting, subordinating or
releasing the lien or security interest created in or evidenced by this Deed of
Trust or its status as a first and prior lien and security interest in and to
the Mortgaged Property. For payment of the Secured Debt, Beneficiary may resort
to any other security in such order and manner as Beneficiary may elect.

 

Section 5.5 Waiver of Redemption, Notice and Marshalling of Assets. To the
fullest extent permitted by law, Grantor hereby irrevocably and unconditionally
waives and releases (a) all benefit that might accrue to Grantor by virtue of
any present or future statute of limitations or law or judicial decision
exempting the Mortgaged Property from attachment, levy or sale on execution or
providing for any stay of execution, exemption from civil process, redemption or
extension of time for payment, (b) all notices of any Actionable Default or of
Trustee’s or Beneficiary’s election to exercise or the actual exercise of any
right, remedy or recourse provided for under the Collateral Trust Agreement, the
Credit Agreement or other Security Documents, or this Deed of Trust, and (c) any
right to a marshalling of assets or a sale in inverse order of alienation.

 

Section 5.6 Discontinuance of Proceedings. If Trustee or Beneficiary shall have
proceeded to invoke any right, remedy or recourse permitted under the Collateral
Trust Agreement or this Deed of Trust and shall thereafter elect to discontinue
or abandon it for any reason, Trustee or Beneficiary shall have the unqualified
right to do so and, in such an event, Grantor, Trustee, and Beneficiary shall be
restored to their former positions with respect to the Secured Debt, the
Security Documents, the Mortgaged Property and otherwise, and the rights,
remedies, recourses and powers of Trustee and Beneficiary shall continue as if
the right, remedy or recourse had never been invoked, but no such discontinuance
or abandonment shall waive any Actionable Default which may then exist or the
right of Trustee or Beneficiary thereafter to exercise any right, remedy or
recourse under the Collateral Trust Agreement, the Credit Agreement, or this
Deed of Trust for such Actionable Default.

 

Section 5.7 Application of Proceeds. The proceeds of any sale of “as-extracted”
collateral, and the Rents and other amounts generated by the holding, leasing,
management, operation or other use of the Mortgaged Property, shall be applied
by Trustee or Beneficiary (or the receiver, if one is appointed) in the
following order unless otherwise required by applicable law:

 

(a) to the payment of the costs and expenses of taking possession of the
Mortgaged Property and of holding, using, leasing, repairing, improving and
selling the same, including, without limitation (1) trustee’s or receiver’s fees
and expenses, including the repayment of the amounts evidenced by any receiver’s
certificates, (2) court costs, (3) attorneys’ and accountants’ fees and
expenses, (4) costs of advertisement, (5) a commission to the Trustee equal to
the commission allowed to trustees for making sales of property by virtue of a
decree of a court of equity in the State of Maryland, and (6) the payment of all
rent and other charges under any applicable Mortgaged Lease;

 

(b) to the payment and performance of the Secured Debt, in such manner and order
of preference as set forth in the Collateral Trust Agreement; and

 

(c) the balance, if any, to the Persons legally entitled thereto.

 

Section 5.8 Occupancy After Foreclosure. Any sale of the Mortgaged Property or
any part thereof in accordance with Section 5.1(d) will divest all right, title
and interest of Grantor in and to the property sold. Subject to applicable law
and any applicable Mortgaged Lease, any purchaser at a foreclosure sale will
receive immediate possession of the property purchased. If Grantor retains
possession of such property or any part thereof subsequent to such sale, Grantor
will be considered a tenant at sufferance of the purchaser, and will, if Grantor
remains in possession after demand to remove, be subject to eviction and
removal, forcible or otherwise, with or without process of law.

 

Section 5.9 Additional Advances and Disbursements; Costs of Enforcement.

 

(a) Upon the occurrence and during the continuance of any Actionable Default,
Beneficiary shall have the right, but not the obligation, to cure such
Actionable Default in the name and on behalf of Grantor. All sums advanced and
expenses incurred at any time by Beneficiary under this Section 5.9, or
otherwise under the

 

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Collateral Trust Agreement, this Deed of Trust, any of the Security Documents,
or applicable law, shall bear interest from the date that such sum is advanced
or expense incurred, to and including the date of reimbursement, computed at the
highest rate at which interest is then computed on any portion of the Secured
Debt, and all such sums, together with interest thereon, shall be secured by
this Deed of Trust.

 

(b) Grantor shall pay all expenses (including reasonable attorneys’ fees and
expenses) of or incidental to the perfection and enforcement of this Deed of
Trust and the Collateral Trust Agreement, or the enforcement, compromise or
settlement of the Secured Debt or any claim under this Deed of Trust or the
Collateral Trust Agreement and for the curing thereof, or for defending or
asserting the rights and claims of Beneficiary in respect thereof, by litigation
or otherwise.

 

(c) In the event that the Secured Debt shall be paid after the filing of a
foreclosure proceeding with the appropriate court, but before sale of the
Mortgaged Property, Grantor shall also be required to pay all of the expenses
incident to or resulting from the foreclosure proceedings under this Deed of
Trust, and a commission, on the total amount of the Secured Debt, remaining
unpaid, equal to one-half (½) of the percentage allowed as commission to
trustees for making a sale under a decree of a court of equity in Maryland and
such reasonable and necessary counsel fees and expenses as Trustee or
Beneficiary may have incurred, even if greater than the aforementioned amount;
provided, however, that the same may be proceeded with unless, prior to the date
on which the sale is scheduled, payment is made by Grantor of the Secured Debt,
including all principal and interest, costs, expenses, commissions, and fees, as
provided herein.

 

Section 5.10 No Mortgagee in Possession. Neither the enforcement of any of the
remedies under this Article 5, the assignment of the Rents and Leases under
Article 6, the security interests under Article 7, nor any other remedies
afforded to Beneficiary hereunder or under the Collateral Trust Agreement, or at
law or in equity shall cause Trustee or Beneficiary to be deemed or construed to
be a mortgagee in possession of the Mortgaged Property, to obligate Trustee or
Beneficiary to lease the Mortgaged Property or attempt to do so, or to take any
action, incur any expense, or perform or discharge any obligation, duty or
liability whatsoever under any of the Leases or otherwise.

 

ARTICLE 6

ASSIGNMENT OF RENTS AND LEASES

 

Section 6.1 Assignment. In furtherance of and in addition to the assignment made
by Grantor in Section 2.1 of this Deed of Trust, Grantor hereby absolutely and
unconditionally assigns, sells, transfers and conveys to Beneficiary all of its
right, title and interest in and to all Leases, whether now existing or
hereafter entered into, and all of its right, title and interest in and to all
Rents. This assignment is an absolute assignment and not an assignment for
additional security only. So long as no Actionable Default shall have occurred
and be continuing, Grantor shall have a revocable license from Trustee and
Beneficiary to exercise all rights extended to the landlord under the Leases,
including the right to receive and collect all Rents and to hold the Rents in
trust for use in the payment and performance of the Secured Debt, and to
otherwise use the same. The foregoing license is granted subject to the
conditional limitation that no Actionable Default shall have occurred and be
continuing. Upon the occurrence and during the continuance of an Actionable
Default, whether or not legal proceedings have commenced, and without regard to
waste, adequacy of security for the Secured Debt or solvency of Grantor, the
license herein granted shall automatically expire and terminate, without notice
to Grantor by Trustee or Beneficiary (any such notice being hereby expressly
waived by Grantor to the extent permitted by applicable law).

 

Section 6.2 Perfection Upon Recordation. Grantor acknowledges that Trustee and
Beneficiary have taken all actions necessary to obtain, and that upon
recordation of this Deed of Trust, Trustee and Beneficiary shall have, to the
extent permitted under applicable law, a valid and fully perfected, first
priority, present assignment of the Rents arising out of the Leases and all
security for such Leases. Grantor acknowledges and agrees that upon recordation
of this Deed of Trust, Trustee’s and Beneficiary’s interest in the Rents shall
be deemed to be fully perfected, “choate” and enforced as to Grantor and to the
extent permitted under applicable law, all third parties, including, without
limitation, any subsequently appointed trustee in any case under Title 11 of the
United States Code (the “Bankruptcy Code”), without the necessity of commencing
a foreclosure action with respect to this

 

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Deed of Trust, making formal demand for the Rents, obtaining the appointment of
a receiver or taking any other affirmative action.

 

Section 6.3 Bankruptcy Provisions. Without limitation of the absolute nature of
the assignment of the Rents hereunder, Grantor, Trustee, and Beneficiary agree
that (a) this Deed of Trust shall constitute a “security agreement” for purposes
of Section 552(b) of the Bankruptcy Code, (b) the security interest created by
this Deed of Trust extends to property of Grantor acquired before the
commencement of a case in bankruptcy and to all amounts paid as Rents and (c)
such security interest shall extend to all Rents acquired by the estate after
the commencement of any case in bankruptcy.

 

Section 6.4 No Merger of Estates. So long as any part of the Secured Debt remain
unpaid and undischarged, the fee and leasehold estates to the Mortgaged Property
shall not merge, but shall remain separate and distinct, notwithstanding the
union of such estates either in Grantor, Beneficiary, any tenant or any third
party by purchase or otherwise.

 

ARTICLE 7

SECURITY AGREEMENT AND FIXTURE FILING

 

Section 7.1 Security Interest. This Deed of Trust constitutes a “security
agreement” on personal property within the meaning of the UCC and other
applicable law and with respect to the Fixtures, Mineral Interests, Leases,
Rents, Permits, Personalty, Tax Refunds, Proceeds, Insurance and Condemnation
Awards. To this end, Grantor grants to Beneficiary a first and prior security
interest in the Fixtures, Leases, Rents, Permits, Personalty, Proceeds, Tax
Refunds, Insurance, Condemnation Awards and all other Mortgaged Property,
including “as-extracted collateral” (as such terms are used in the UCC), also
including coal, oil and gas, and other minerals, to secure the payment and
performance of the Secured Debt, and agrees that Beneficiary shall have all the
rights and remedies of a secured party under the UCC with respect to such
property. Any notice of sale, disposition or other intended action by
Beneficiary with respect to the Fixtures, Mineral Interests, Leases, Rents,
Personalty, Permits, Tax Refunds, Proceeds, Insurance and Condemnation Awards or
other Mortgaged Property, including without limitation, “as-extracted
collateral” (as such terms are used in the UCC), including coal and other
minerals, sent to Grantor at least ten (10) days prior to any action under the
UCC shall constitute reasonable notice to Grantor.

 

Section 7.2 Financing Statements. Grantor shall prepare and deliver to
Beneficiary such financing statements, and shall execute and deliver to
Beneficiary such other documents, instruments and further assurances, in each
case in form and substance satisfactory to Beneficiary, as Beneficiary may, from
time to time, reasonably consider necessary to create, perfect and preserve
Beneficiary’s security interest hereunder. Grantor hereby irrevocably authorizes
Beneficiary to cause financing statements (and amendments thereto and
continuations thereof) and any such documents, instruments and assurances to be
recorded and filed, at such times and places as may be required or permitted by
law to so create, perfect and preserve such security interest. Grantor
represents and warrants to Beneficiary that its jurisdiction of organization, as
set forth in Schedule 1 hereof, is correct . After the date of this Deed of
Trust, Grantor shall not change its name, type of organization, organizational
identification number (if any), jurisdiction of organization or location (within
the meaning of the UCC) without giving at least thirty (30) days’ prior written
notice to Beneficiary.

 

Section 7.3 Fixture and “as-extracted” Collateral Filing. This Deed of Trust
shall also constitute a “fixture filing” and an “as-extracted” collateral filing
for the purposes of the UCC against all of the Mortgaged Property which is or is
to become fixtures or “as-extracted” collateral related to the Premises. The
information provided in this Section 7.3 is provided so that this Deed of Trust
shall comply with the requirements of the UCC for a Deed of Trust instrument to
be filed as a financing statement. Grantor is the “Debtor” and its name and
mailing address are set forth in the preamble of this Deed of Trust immediately
preceding Article 1. Beneficiary is the “Secured Party” and its name and mailing
address from which information concerning the security interest granted herein
may be obtained are also set forth in the preamble of this Deed of Trust
immediately preceding Article 1. A statement describing the portion of the
Mortgaged Property comprising the fixtures hereby secured is set forth in
Section 1.1(k) of this Deed of Trust. Grantor represents and warrants to
Beneficiary that Grantor is the record owner of the applicable fee title or
owner of the leasehold interest in the Mortgaged Property. The employer
identification number of Grantor and its organizational identification number
are set forth in Schedule 1 hereto.

 

11

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Section 7.4 Nothing contained in this Article 7 or elsewhere in this Deed of
Trust shall be construed to create a lien upon, or a security interest in, the
Excluded Structures, title to which shall remain unencumbered and fully vested
in Grantor.

 

ARTICLE 8

CONCERNING THE TRUSTEE

 

Section 8.1 Certain Rights. With the approval of Beneficiary, Trustee shall have
the right to select, employ and consult with counsel. Trustee shall have the
right to rely on any instrument, document or signature authorizing or supporting
any action taken or proposed to be taken by it hereunder, believed by it in good
faith to be genuine. Trustee shall be entitled to reimbursement for actual,
reasonable expenses incurred by it in the performance of its duties and to
reasonable compensation for Trustee’s services hereunder as shall be rendered.
Grantor shall, from time to time, pay the compensation due to Trustee hereunder
and reimburse Trustee for, and indemnify, defend and save Trustee harmless
against, all liability and reasonable expenses which may be incurred by it in
the performance of its duties, including those arising from joint, concurrent,
or comparative negligence of Trustee; provided, however, that Grantor shall not
be liable under such indemnification to the extent such liability or expenses
result solely from Trustee’s gross negligence or willful misconduct. Grantor’s
obligations under this Section 8.1 shall not be reduced or impaired by
principles of comparative or contributory negligence.

 

Section 8.2 Retention of Money. All moneys received by Trustee shall, until used
or applied as herein provided, be held in trust for the purposes for which they
were received, but need not be segregated in any manner from any other moneys
(except to the extent required by law), and Trustee shall be under no liability
for interest on any moneys received by Trustee hereunder.

 

Section 8.3 Successor Trustees. If Trustee or any successor Trustee shall die,
resign or become disqualified from acting in the execution of this trust, or
Beneficiary shall desire to appoint a substitute Trustee, Beneficiary shall have
full power to appoint one or more substitute Trustees and, if preferred, several
substitute Trustees in succession who shall succeed to all the estates, rights,
powers and duties of Trustee. Such appointment may be executed by any authorized
agent of Beneficiary and as so executed, such appointment shall be conclusively
presumed to be executed with authority, valid and sufficient, without further
proof of any action.

 

Section 8.4 Perfection of Appointment. Should any deed, conveyance, or
instrument of any nature be required from Grantor by any successor Trustee to
more fully and certainly vest in and confirm to such successor Trustee such
estates, rights, powers and duties, then, upon request by such Trustee, all such
deeds, conveyances and instruments shall be made, executed, acknowledged and
delivered and shall be caused to be recorded and/or filed by Grantor.

 

Section 8.5 Trustee Liability. In no event or circumstance shall Trustee or any
substitute Trustee hereunder be personally liable under or as a result of this
Deed of Trust, either as a result of any action by Trustee (or any substitute
Trustee) in the exercise of the powers hereby granted or otherwise.

 

Section 8.6 One Trustee May Act. The act of any one Trustee, whether such
Trustee is a sole acting Trustee or whether there is more than one acting
Trustee, shall be sufficient and effective for all purposes set forth herein and
any person may rely upon any document or instrument executed and delivered by
one Trustee, to the same extent as though the document had been executed by all
of the Trustees.

 

ARTICLE 9

MISCELLANEOUS

 

Section 9.1 Notices. Any notice required or permitted to be given under this
Deed of Trust shall be given in accordance with Section 11.6 of the Credit
Agreement.

 

Section 9.2 Covenants Running with the Land. All obligations contained in this
Deed of Trust are intended by Grantor, Trustee, and Beneficiary to be, and shall
be construed as, covenants running with the

 

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Mortgaged Property. As used herein, “Grantor” shall refer to the party named in
the first paragraph of this Deed of Trust and to any subsequent owner of all or
any portion of the Mortgaged Property. All Persons who may have or acquire an
interest in the Mortgaged Property shall be deemed to have notice of, and be
bound by, the terms of this Deed of Trust; provided, however, that no such party
shall be entitled to any rights, thereunder without the prior written consent of
Beneficiary.

 

Section 9.3 Attorney-in-Fact. Grantor hereby irrevocably appoints Beneficiary as
its attorney-in-fact, which agency is coupled with an interest and with full
power of substitution, with full authority in the place and stead of Grantor and
in the name of Grantor or otherwise (a) to execute and/or record any notices of
completion, cessation of labor or any other notices that Beneficiary deems
appropriate to protect Beneficiary’s interest, if Grantor shall fail to do so
within ten (10) days after written request by Beneficiary, (b) upon the issuance
of a deed pursuant to the foreclosure of this Deed of Trust or the delivery of a
deed in lieu of foreclosure, to execute all instruments of assignment,
conveyance or further assurance with respect to the Leases, Rents, Deposit
Accounts, Property Agreements, Tax Refunds, Permits, Personalty, Proceeds,
Insurance and Condemnation Awards in favor of the grantee of any such deed and
as may be necessary or desirable for such purpose, (c) to prepare, execute, and
file or record financing statements and continuation statements, and to prepare,
execute and file or record applications for registration and like papers
necessary to create, perfect or preserve Beneficiary’s security interests and
rights in or to any of the Mortgaged Property, and (d) after the occurrence and
during the continuance of any Actionable Default, to perform any obligation of
Grantor hereunder, provided, however, that (1) Beneficiary shall not under any
circumstances be obligated to perform any obligation of Grantor, (2) any sums
advanced by Beneficiary in such performance shall be added to and included in
the Secured Debt and shall bear interest at the highest rate at which interest
is then computed on any portion of the Secured Debt; (3) Beneficiary as such
attorney-in-fact shall only be accountable for such funds as are actually
received by Beneficiary; and (4) Beneficiary shall not be liable to Grantor or
any other person or entity for any failure to take any action which it is
empowered to take under this Section 9.3.

 

Section 9.4 Successors and Assigns. This Deed of Trust shall be binding upon and
inure to the benefit of Beneficiary, Trustee, and Grantor and their respective
successors and assigns. Grantor shall not, without the prior written consent of
Beneficiary, assign any rights, duties or obligations hereunder.

 

Section 9.5 No Waiver. Any failure by Beneficiary or Trustee to insist upon
strict performance of any of the terms, provisions or conditions of the
Collateral Trust Agreement or this Deed of Trust, or of any other document or
instrument relating to any portion of the Secured Debt, shall not be deemed to
be a waiver of same, and Beneficiary or Trustee shall have the right at any time
to insist upon strict performance of all of such terms, provisions and
conditions.

 

Section 9.6 Conflicts Between Documents. In the event of any conflict between
the provisions of this Deed of Trust, the Credit Agreement or any of the other
Security Documents and the provisions of the Collateral Trust Agreement, the
provisions of the Collateral Trust Agreement shall control. Notwithstanding any
provision in this Deed of Trust, the Credit Agreement or any of the Security
Documents to the contrary, the parties and signatories hereto acknowledge and
agree that any and all rights, powers, privileges, duties, responsibilities,
liabilities and/or obligations (including but not limited to the right to grant
or withhold consent and the right to act or refrain from acting), whether
discretionary or mandatory, are and shall be exercised by the Collateral Trustee
solely in accordance with the terms and conditions of the Collateral Trust
Agreement, at the direction of the Credit Facility Agent or other entity
specified in the Collateral Trust Agreement as having the right to give
direction to the Collateral Trustee, and subject further to the rights of the
Collateral Trustee to require officers’ certificate(s), opinion(s) and advice
from counsel, accountants, appraisers and other third parties, advancement of
expenses and/or assurances of indemnity satisfactory to the Collateral Trustee.
If any conflict or inconsistence exists between this Deed of Trust and the
Credit Agreement, the terms of the Credit Agreement shall govern.

 

Section 9.7 Release or Reconveyance. Upon payment and performance in full of the
Secured Debt, or upon a sale or other disposition of the Mortgaged Property
permitted by the Credit Agreement and the Collateral Trust Agreement,
Beneficiary, at Grantor’s request and expense, shall release the liens and
security interests created by this Deed of Trust or reconvey the Mortgaged
Property to Grantor.

 

Section 9.8 Waiver of Stay, Moratorium and Similar Rights. Grantor agrees, to
the full extent that it may lawfully do so, that it will not at any time insist
upon or plead or in any way take advantage of any

 

13

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stay, marshalling of assets, extension, redemption or moratorium law now or
hereafter in force and effect so as to prevent or hinder the enforcement of the
provisions of this Deed of Trust or the Collateral Trust Agreement, or any
agreement between Grantor and Beneficiary or any rights or remedies of Trustee
or Beneficiary.

 

Section 9.9 Applicable Law. The provisions of this Deed of Trust regarding the
creation, perfection and enforcement of the liens and security interests herein
granted shall be governed by and construed under the laws of the state in which
the Mortgaged Property is located. All other provisions of this Deed of Trust
shall be governed by the laws of the Commonwealth of Pennsylvania.

 

Section 9.10 Headings. The Article, Section and Subsection titles hereof are
inserted for convenience of reference only and shall in no way alter, modify or
define, or be used in construing, the text of such Articles, Sections or
Subsections.

 

Section 9.11 Severability. If any provision of this Deed of Trust shall be held
by any court of competent jurisdiction to be unlawful, void or unenforceable for
any reason, such provision shall be deemed severable from and shall in no way
affect the enforceability and validity of the remaining provisions of this Deed
of Trust.

 

Section 9.12 Entire Agreement. This Deed of Trust, the Credit Agreement the
Collateral Trust Agreement, and the Security Documents embody the entire
agreement and understanding between Beneficiary and Grantor relating to the
subject matter hereof and thereof and supersede all prior agreements and
understandings between such parties relating to the subject matter hereof and
thereof. Accordingly, such documents may not be contradicted by evidence of
prior, contemporaneous or subsequent oral agreements of the parties. There are
no unwritten oral agreements between the parties.

 

Section 9.13 Beneficiary as Collateral Trustee; Successor Collateral Trustees.

 

(a) Beneficiary shall have the right hereunder to make demands, to give notices,
to exercise or refrain from exercising any rights, and to take or refrain from
taking any action (including, without limitation, the release or substitution of
the Mortgaged Property) in accordance with the terms of the Collateral Trust
Agreement and this Deed of Trust.

 

(b) Beneficiary shall at all times be the same Person or Persons that comprise
the Collateral Trustee under the Collateral Trust Agreement. Written notice of
resignation by Collateral Trustee pursuant to the Collateral Trust Agreement
shall also constitute notice of resignation as Collateral Trustee under this
Deed of Trust. Removal of Collateral Trustee pursuant to any provision of the
Collateral Trust Agreement shall also constitute removal as Collateral Trustee
under this Deed of Trust. Appointment of a successor Collateral Trustee pursuant
to the Collateral Trust Agreement shall also constitute appointment of a
successor Collateral Trustee under this Deed of Trust. Upon the acceptance of
any appointment as Collateral Trustee by a successor Collateral Trustee under
the Collateral Trust Agreement, that successor Collateral Trustee shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring or removed Collateral Trustee as the Beneficiary
under this Deed of Trust, and the retiring or removed Collateral Trustee shall
promptly (i) assign and transfer to such successor Collateral Trustee all of its
right, title and interest in and to this Deed of Trust and the Mortgaged
Property, and (ii) execute and deliver to such successor Collateral Trustee such
assignments and amendments and take such other actions, as may be necessary or
appropriate in connection with the assignment to such successor Collateral
Trustee of the liens and security interests created hereunder, whereupon such
retiring or removed Collateral Trustee shall be discharged from its duties and
obligations under this Deed of Trust. After any retiring or removed Collateral
Trustee’s resignation or removal hereunder as Collateral Trustee, the provisions
of this Deed of Trust and the Collateral Trust Agreement shall inure to its
benefit as to any actions taken or omitted to be taken by it under this Deed of
Trust while it was Collateral Trustee hereunder.

 

[The remainder of this page has been intentionally left blank]

 

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Section 9.14 WAIVER OF TRIAL BY JURY.

 

GRANTOR AND BENEFICIARY EACH WAIVES THE RIGHT TO A TRIAL BY JURY IN ANY ACTION
OR PROCEEDING BASED UPON OR RELATED TO THE SUBJECT MATTER OF THIS DEED OF TRUST
OR THE COLLATERAL TRUST AGREEMENT, OR ANY OF THE OTHER SECURITY DOCUMENTS, OR
ANY OF THE TRANSACTIONS RELATED TO ANY OF THE SECURED DEBT. THIS WAIVER IS
KNOWINGLY, INTENTIONALLY AND VOLUNTARILY MADE BY GRANTOR AND BENEFICIARY, AND
GRANTOR AND BENEFICIARY EACH ACKNOWLEDGES THAT NEITHER THE OTHER NOR ANY PERSON
ACTING ON BEHALF OF THE OTHER HAS OR HAVE MADE ANY REPRESENTATIONS OF FACT TO
INDUCE THIS WAIVER OF TRIAL BY JURY OR IN ANY WAY TO MODIFY OR NULLIFY ITS
EFFECT. GRANTOR AND BENEFICIARY EACH FURTHER ACKNOWLEDGES THAT IT HAS BEEN
REPRESENTED (OR HAS HAD THE OPPORTUNITY TO BE REPRESENTED) IN THE SIGNING OF
THIS AGREEMENT AND IN THE MAKING OF THIS WAIVER BY INDEPENDENT LEGAL COUNSEL
SELECTED OF ITS OWN FREE WILL AND THAT IT HAS HAD THE OPPORTUNITY TO DISCUSS
THIS WAIVER WITH COUNSEL. GRANTOR AND BENEFICIARY EACH AGREES THAT THE
OBLIGATIONS SECURED BY THIS DEED OF TRUST ARE EXEMPTED TRANSACTIONS UNDER THE
TRUTH-IN-LENDING ACT, 15 U.S.C. SECTION 1601, ET SEQ.

 

Initials of Grantor:

_________________

 

[The remainder of this page has been intentionally left blank]

 

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IN WITNESS WHEREOF, Grantor has on the date set forth in the acknowledgement
hereto, effective as of the date first above written, caused this instrument to
be duly EXECUTED AND DELIVERED by authority duly given with the specific
intention of creating a document under seal.

 

GRANTOR:

CNX MARINE TERMINALS, INC.,

a Delaware corporation

By:

   

Name:

  Ronald G. Stovash

Title:

  President

 

Attest:

   

Name:

  Paige M. Greene

Title:

  Assistant Secretary

 

[Section 9.14 must be initialed]

 

N-1

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Baltimore 2

 

STATE OF                                                      
                )        ss.:

COUNTY OF                                                                   )

 

On this the      day of June, 2004, before me, the undersigned officer,
personally appeared RONALD G. STOVASH, who acknowledged himself to be the
PRESIDENT of CNX MARINE TERMINALS INC., and that he as such Officer being
authorized so to do, executed the foregoing instrument for the purposes therein
contained, by signing the name of the corporation by him as such officer.

 

In Witness Whereof I have hereunto set my hand and official seal.

 

My commission expires:

 

  Notary Public

 

[Notarial Seal]

 

N-2

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Baltimore 3

 

CERTIFICATION

 

This instrument was prepared by Michael A. Donadee on behalf of David A.
Vanaskey, not in his individual capacity, but solely as Collateral Trustee

 

By:    

Name:

  Michael A. Donadee

 

Tax Parcel ID No.: 0366071100800

 

Exh. A-1

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Tax Parcel ID No.: 0366071100800

 

EXHIBIT A

 

LEGAL DESCRIPTION

 

Legal Description of premises located at 3800 Newgate Avenue, Baltimore,
Maryland 21224:

 

[See Attached Page(s) For Legal Description]

 

Sch.1

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EXHIBIT B

(Baltimore Harbor Facility)

 

All of those certain tracts or parcels of real estate, together with the
buildings-and improvements thereon and the appurtenances thereunto belonging;
situate in the City of Baltimore, Maryland, being more particularly bounded and
described as follows:

 

TRACT NO. 1

 

The following two pieces or parcels of land lying and being in Ward 26, Section
2, Block 6607 of Baltimore, Maryland:

 

Parcel No. 1

 

BEGINNING for the second at the end of the forty-fifth or South 03° 00, 20”
East, 10.27 foot line of Parcel No. 3 of Exhibit C, described in a Deed dated
June 6, 1979 from the Canton Company of Baltimore and Canton Railroad Company to
the Mayor and City Council of Baltimore and recorded among the Land Records of
Baltimore City in Liber W.A. No. 3768 at folio 827, thence binding reversely on
the forty-fourth through the thirty-fifth lines thereof for the following eleven
courses and distances, (1) North 03° 00’ 20” West, 10.27 feet; (2) South 86° 59’
40” West, 16.00 feet; (3) North 03° 00’ 20” West, 532.93 feet; (4) Northwesterly
along a curve to the left, having a radius of 2885.79 feet, for a distance of
104.06 feet, being subtended by a Chord bearing and distance of North 04° 02’
19” West, 104.06 feet; (5) North 05° 04’ 18” West, 110.53 feet; (6)
Northeasterly along a curve to the right, having a radius of 279.00 feet, for a
distance of 109.68 feet, being subtended by a Chord beating and distance of
North 06° 11’ 25” East, 108.98 feet; (7) North 17° 27’ 09” East, 140.79 feet;
(8) Northeasterly along a curve to the left, having a radius of 425.12 feet, for
a distance of 94.84 feet, being subtended by a Chord bearing and distance of
North 11° 03’ 40.5” East, 94.65 feet; (9) North 04° 40’ 12” East, 100.67 feet;
(10) Northwesterly along a curve to the left, having a radius of 207.62 feet,
for a distance of 87.51 feet, being subtended by a Chord bearing and distance of
North 07° 24’ 17.5” West, 86.64 feet; (11) North 19° 28’ 47” West, 31.64 feet to
the beginning of the ninth or North 70° 31’ 13” East, 116.76 foot line of
Exhibit K as described in the aforementioned Deed to the Mayor and City Council
of Baltimore, thence binding on the ninth through the thirteenth lines thereof,
for the following five courses and distances, (12) North 70° 31’ 13” East,
116.76 feet; (13) Northeasterly along a curve to the left, having a radius of
153.11 feet, for a distance of 174.06 feet, being subtended by a Chord bearing
and distance of North 37° 57’ 06” East, 164.84 feet; (14) North 05° 22’ 59”
East, 67.98 feet; (15) South 89° 55’ 10” East, 87.47 feet; (16) North 60° 20’
35” East, 39.83 feet; to the end of the seventh or curved line of a length of
41.27 feet and a radius of 128.00 feet, described in Parcel No. 2 of Exhibit B
as described in the aforementioned Deed to the Mayor and City Council of
Baltimore, thence binding reversely on the seventh through the first lines
thereof for the following seven courses and distances, (17) Northwesterly along
a curve to the right, having a radius of 128.00 feet, for a distance of 41.27
feet, being subtended by a Chord bearing and distance of North 09° 09’ 22” West,
41.09 feet; (18) North 00° 04’ 50” East, 267.74 feet; (19) North 00° 54’ 50”
West, 77.74 feet; (20) North 00° 41” 02” East, 508.03 feet; (21) North 00° 04’
50” East, 97.26 feet; (22) Northeasterly along a curve to the right, having a
radius of 480.00 feet, for a distance of 20.73 feet, being subtended by a Chord
bearing and distance of North 01° 19’ 04” East, 20.73 feet; (23) North 40° 02’
24” East, 102.29 feet to a point on the eighth line of the second parcel
described in a Lease dated September 15, 1927 from the Canton Company of
Baltimore to the Canton Railroad Company, recorded among the aforementioned Land
Records in Liber S.C.L. No. 4800 at folio 113, 539.36 feet from the beginning of
said eighth line, thence binding on said eighth line and on the ninth line
thereof and an extension thereof, as now surveyed, for the following two courses
and distances, (24) North 87° 11’ 05” East, 250.59 feet; (25) South 02° 53’ 27”
East, 2630.81 feet to a point on the fourth or North 87° 10’ 30” East, 2276.85
foot line of Exhibit E as described in the aforementioned Deed to the Mayor and
City Council of Baltimore 1809.02 feet from the beginning thereof, thence
binding on said fourth line and on the northerly side of Newgate Avenue, 56 feet
wide, (26) South 87° 10’ 30” West, 785.94 feet to the point of BEGINNING,
containing 34.9045 acres of land, more or less.

 

Sch.2

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Parcel No. 2

 

BEGINNING for the third at a point on the north side of Newgate Avenue, 56 feet
wide, and the westerly side of Haven Street, of varying width, said point being
at the end of the first or South 87° 10’ 30” West, 51.00 foot line of Parcel No.
3 of Exhibit C as described in a Deed dated June 6, 1979 from the Canton Company
of Baltimore and the Canton Railroad Company to the Mayor and City Council of
Baltimore, recorded among the Land Records of Baltimore City in Liber W.A. 3768
at folio 827, thence leaving said Newgate Avenue and binding on the westerly
side of said Haven Street and on the second through tenth lines of said Exhibit
C, the following nine courses and distances, (1) North 03° 00’ 20” West, 543.05
feet; (2) Northwesterly along a curve to the left, having a radius of 2850.79
feet, for a distance of 102.80 feet, being subtended by a Chord bearing and
distance of North 04° 02’ 19” West, 102.80 feet; (3) North 05° 04’ 18” West,
56.75 feet; (4) South 84° 55’ 42” West, 7.00 feet; (5) North 05° 04’ 18” West,
53.78 feet; (6) Northeasterly along a curve to the right, having a radius of
321.00 feet, for a distance of 126.19 feet, being subtended by a Chord bearing
and distance of North 06° 11’ 25” East, 125.38 feet; (7) North 17° 27’ 09” East,
140.79 feet; (8) Northeasterly along a curve to the left, having a radius of
383.12 feet, for a distance of 85.47 feet, being subtended by a Chord bearing
and distance of North 11° 03’ 40.5” East, 85.30 feet; (9) North 04° 40’ 12”
East, 71.52 feet; to the end of the fifth or South 04° 40’ 12” West, 29.15 foot
line of Parcel No. 2 of Exhibit K as described in the aforementioned Deed to the
Mayor and City Council of Baltimore, thence binding on the sixth and seventh
lines of said Parcel No. 2 and on the southerly side of Keith Avenue, varying
width for the following two courses and distances (10) South 70° 31’ 13” West,
225.46 feet; (11) South 71° 39’ 58” West, 200.04 feet to the end of the
thirty-second or South 19° 28’ 47” East, 106.00 foot line of Parcel No. 1 of
Exhibit B as described in the aforementioned Deed to the Mayor and City Council
of Baltimore, thence binding on the thirty-third through the forty-first lines
of said Parcel No. 1 for the following nine courses and distances, and
continuing on the said southerly side of Keith Avenue of varying width, (12)
South 35° 09’ 28” West, 38.01 feet; (13) South 70° 31’ 13” West, 19.00 feet;
(14) South 76° 13’ 51” West, 201.00 feet; (15) South 70° 31’ 13” West, 150.00
feet; (16) South 76° 13’ 51” West, 100.50 feet; (17) South 70° 31’ 13” West,
280.00 feet; (18) South 70° 31’ 13” West, 670.00 feet; (19) South 68° 55’ 18”
West, 215.08 feet; (20) South 74° 24’ 15” West, 76.04 feet to a point on the
third or curved line to the northeast, described in an Agreement dated March 17,
1905 between the Canton Company of Baltimore and The Hazard Wharf Company,
recorded among the Land Records of Baltimore County in Liber W.P.C. 392 at folio
197, thence binding on said third line, as now surveyed, (21) Southwesterly
along a curve to the right, having a radius of 346.51 feet, for a distance of
180.92 feet, being subtended by a Chord bearing and distance of South 62° 13’
07.5” West, 178.87 feet to a point on the second or curved line to the west,
described in a Deed dated October 29, 1894 from the Canton Company of Baltimore
to the Union Railroad Company of Baltimore, recorded among the Land Records of
Baltimore County in Liber L.M.B. No. 210 at folio 162, thence binding on said
second line, as now surveyed, (22) Southwesterly along a curve to the right,
having a radius of 328.71 feet, for a distance of 35.97 feet, being subtended by
a Chord bearing and distance of South 21° 38’ 20.5” West, 35.96 feet to the
southwest comer of First Street (Highland Avenue) and Eleventh Avenue (Mertens
Avenue); thence binding on the westerly side of said First Street (Highland
Avenue), as shown on the Plan of Canton and a southerly prolongation thereof,
(23) South 02° 51’ 40” East, 1510.43 feet to a point on the Pierhead Line of
Baltimore Harbor, as established and approved by the Secretary of the Army on
August 14, 1950; thence binding on said Pierhead Line for the following two
courses and distances, (24) South 47° 57’ 48” East, 1103.55 feet; (25) South 72°
37’ 20” East, 1810.37 feet; thence leaving said Pierhead Line and binding on the
Line of Agreement described in an Agreement dated February 28, 1930 between The
Northern Central Railway Company, The Pennsylvania Railroad Company and Canton
Company of Baltimore and Canton Railroad Company recorded among the Land Records
of Baltimore City in Liber S.C.L. No. 5115 at folio 58, (26) North 02° 51’ 08”
West, 2410.86 feet to a point on the southerly side of Newgate Avenue, 56 feet
wide, said point being on the second or South 87° 10’ 30” West, 2276.91 foot
line of Parcel No. 5 of Exhibit E as described in the aforementioned Deed from
the Canton Company of Baltimore and the Canton Railroad Company to the Mayor and
City Council of Baltimore, recorded among the Land Records of Baltimore City in
Liber W.A. 3768 at folio 827, 996.48 feet from the beginning of said second
line, thence binding on the second, third and fourth lines thereof for the
following three courses and distances,

 

Sch. 3

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(27) South 87° 10’ 30” West, 1280.43 feet; (28) North 02° 49’ 30” West, 56.00
feet; (29) North 87° 10’ 30” East, 972.08 feet to the point of BEGINNING.

 

EXCEPTING therefrom Parcels described in a Deed dated March 29, 1957 from the
Canton Company of Baltimore and Canton Railroad Company to the State of
Maryland, to the use of the State Roads Commission of Maryland, containing
0.8041 acres of land, more or less.

 

Containing 148.8197 net acres, more or less, of which 58.4419 is waterway and
90.3778 acres fast land:

 

Parcel No.3

 

The following piece or parcel of land lying and being in Ward 1, Section 10,
Block 1903-A of Baltimore, Maryland:

 

BEGINNING for the same at a point on the west side of Clinton Street and at the
end of the first or South 02° 51’ 20” West, 198.04 foot line of the second
parcel described in a Deed dated September 2, 1976 from Robert W. Blanchette, et
al, Trustees of the Property of Penn Central Transportation Company to the
Canton Company of Baltimore, recorded among the Land Records of Baltimore City
in Liber R.H.B. No. 3391 at folio 467, thence leaving said Clinton Street and
binding on the second line and in part on the third line of said second parcel,
as now surveyed, the following two courses and distances, (1) South 87° 10’ 27”
West, 1104.15 feet to the Pierhead Line of Baltimore Harbor, as established and
approved by the Secretary of the e Army on August 14, 1950; thence binding on
said Pierhead Line, (2) North 02° 36’ 29” West, 297.40 feet to a point formed by
the extension westerly of the north side of Fifth Avenue, 70 feet wide, as shown
on the Plan of Canton, and said Pierhead Line, thence leaving said Pierhead Line
and binding on said westerly extension, with the use thereof in common, (3)
North 87° 08’ 27” East, 1102.84 feet to a point on the westerly side of said
Clinton Street, 70 feet wide, thence binding on said Clinton Street and in part
on the aforementioned first line, as now surveyed; (4) South 02° 51’ 33” East,
298.04 feet to the point of BEGINNING, containing 7.5421 acres, more or less, of
which 6.0040 is waterway and 1.5381 acres fast land.

 

All of Tract No. 1 being the same real estate conveyed to Consolidation Coal
Sales Company, a Delaware corporation, by Canton Company of Baltimore, a
Maryland corporation, Anaheim Union Water Company, a Delaware corporation, Santa
Ana River Development Company, a Nevada corporation, and Pacific Holding
Corporation, a Delaware corporation, by deed dated September 22, 1980, and
recorded among the Land Records of Baltimore City at Liber 3954, Folio 749, and
the Land Records of Baltimore County at Liber 6208, Folio 451, and further
conveyed by confirmatory deed dated July 15, 1982 and recorded among the Land
Records of Baltimore City at Liber C.W.M. Jr. 4233, at Page 284.

 

TRACT NO. 2

 

The following two pieces or parcels of land lying and being in the City of
Baltimore, State of Maryland, and being more particularly bounded and described
according to plat of survey prepared by Century Engineering, Inc., Consulting
Engineers and Planners, dated April 24, 1981, revised to August 10, 1981, as
follows:

 

“Parcel A”

 

BEGINNING for the said parcel of land at a point on the North 02° 53’ 27” West,
2,630.81 foot line of a deed dated September 22, 1980 and recorded among the
Land Records of Baltimore City in Liber 3954, Page 749, said beginning point
being located 185.32 feet from a p.k. nail set at the intersection of the said
line and the north right of way line of Newgate Avenue, running thence along
said line, the following three (3) bearings and distances: (1) North 02° 53’ 27”
West, 95.39 feet to a concrete monument; thence (2) North 02° 53’ 27” West,
395.02 feet to a concrete monument; thence (3) North 02° 53’ 27” West, 565.02
feet to a point located 26.35 feet southeasterly of a concrete monument set on
said line; thence leaving said line and traversing through the property of the
railroad of Consolidation Rail Corporation (formerly The Northern Central
Railroad) and identified as Line Code 1257A in the records of the United States
Railway

 

Sch. 4

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Association, the following two (2) bearings and distances: (1) South 27° 03’ 14”
East, 545.82 feet to a point of curvature; thence (2) running 644.65 feet along
the arc of a curve deflecting to the right, having a radius of 497.79 feet and a
chord bearing and distance of South 16° 57’ 02.1” West, 600.54 feet to the point
of BEGINNING, containing 3.653 acres of land, more or less.

 

“Parcel B”

 

BEGINNING for the said parcel of land at a point on the North 02° 53’ 27” West,
2,630.81 foot line of a deed dated September 22, 1980 and recorded among the
Land Records of Baltimore City in Liber 3954, Page 749, said beginning point
being located 2,085.81 feet from a p.k; nail set at the intersection of the said
line and the north right of way line of Newgate Avenue, running thence along
said line, the following three (3) bearings and distances: (1) North 02° 53’ 27”
West, 283.71 feet to a ½” iron pipe continuing thence on said line; (2) North
02° 53’ 27” West, 261.29 feet to a concrete monument set at the most
northeasterly corner of the property conveyed to the Consolidated Coal Sales
Company by the aforementioned deed; thence running along a part of the northerly
line of said deed; (3) South 87° 11’ 05” West, 108.00 feet to a point; thence
leaving said deed line and traversing over and across the property of said
Consolidated Rail Corporation, the following fifteen (15) bearings and
distances: (1) North 03° 00’ 00” West, 175.00 feet; thence (2) North 16° 26’ 42”
West, 130.13 feet; thence (3) North 45° 23’ 22” West, 238.00 feet; thence (4)
North 55° 46’ 42” West, 639.62 feet to a point; thence (5) North 02° 54’ 00”
West, 541.80 feet to a point; thence (6) North 87° 06’ 00” East, 10.04 feet;
thence (7) South 12° 23’ 10” East, 230.00 feet; thence (8) South 25° 54’ 47”
East, 236.64 feet; thence (9) South 45° 46’ 42” East, 205.00 feet; thence (10)
South 55° 46’ 42” East; 470.06 feet; thence (11) South 45° 30’ 22” East, 177.19
feet; thence (12) South 29° 39’ 42” East, 122.28 feet; thence (13) South 16° 17’
15” East, 128.20 feet; thence (14) South 02° 49’ 57” East, 120.29 feet; thence
(15) South 01° 35’ 48” West, 587.06 feet to the point of BEGINNING, containing
4.851 acres of land, more or less.

 

Being the same real estate conveyed to Consolidation Coal Sales Company, a
Delaware corporation, by Consolidated Rail Corporation, a Pennsylvania
corporation, by deed dated February 10, 1982, and recorded among the Land
Records of Baltimore City at Liber C.W.M. Jr. 4160, Page 465.

 

TRACT NO. 3

 

The following two pieces or parcels of land lying and being in Baltimore City,
Maryland:

 

“Parcel A”

 

BEGINNING for the same at a concrete monument set on the west side of South
Highland Avenue, 60 feet wide, said point being distant 506.16 feet northerly
from the intersection of the west side of South Highland Avenue and the Pier
Head Line, as now established, in the Patapsco River; thence binding on the west
side of South Highland Avenue (1) North 02° 52’ West, - 1004.26 feet to a point
said point being a masonry nail set in concrete base of fence, said point also
being the intersection of the west side of South Highland Avenue with the south
side of Mertens Avenue, 70 feet wide, thence leaving the west side of South
Highland Avenue and running for the following 6 courses and distances (2) North
87° 08’ East, 60.00 feet, to intersect the east side of South Highland Avenue,
thence binding on the east side of South Highland Avenue, 60 feet wide, (3)
South 02° 52’ East, - 1112.26 feet to a point on an existing concrete bulkhead,
thence binding on the south face of the bulkhead (4) South 87° 08’ West, 16 feet
more or less to intersect the west bulkhead, thence binding on the west bulkhead
(5) North 2° 52’ West, - 40’ more or less to intersect the existing shore line,
thence binding on the existing shore line (6) Northwesterly 47 feet more or less
to intersect the west side of South Highland Avenue, thence (7) North 2° 52”
West - 52 feet more or less to the point of BEGINNING, containing 64,625 square
feet of fast land, more or less.

 

Sch. 5

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“Parcel B”

 

BEGINNING for the same at a point on the west side of Clinton Street, 70 feet
wide, said point distant 278.04 feet northerly from the northeast comer of
existing Pier No. 6, thence binding on the west side of Clinton Street, as now
surveyed (1) North 2° 51’ 20” West, 100.00 feet; thence leaving the west side of
Clinton Street and running for the following five courses and distances (2)
South 87° 08’ 40” West, 404.00 feet; (3) South 2° 51’ 20” East, 74.00 feet; (4)
North 87° 08’ 40” East, 251.00 feet; (5) South 2° 51’ 20” East, 26.00 feet; (6)
North 87° 08’ 40” East, the distance of 153.00 feet to the point of BEGINNING,
containing 33,874 square feet of land, more or less.

 

Being the same real estate conveyed to Consolidation Coal Sales Company, a
Delaware corporation, by Lebanon Chemical Corporation, a Pennsylvania
corporation, by deed dated July 30, 1982, and recorded among the Land Records of
Baltimore City at Liber C.W.M. Jr. 4263, folio 145.

 

EXCEPTING and RESERVING from Tract No. 1 and Tract No. 3 a tract or parcel of
land containing 0.7867 acres, more or less, conveyed by Consolidation Coal Sales
Company to Gemini Realty, LLC by deed dated October 17, 1996 recorded among the
Land Records of Baltimore City at Liber S.E.B. 5940, folio 90, said tract being
more particularly described as follows:

 

BEGINNING for the same at a point formed by the intersection of the west side of
South Clinton Street (70 feet wide) and the south side of Eastbourne Avenue (70
feet wide) extended across South Clinton Street, thence binding along the west
side of South Clinton Street, South 2° 52’ 15” East 458.00 feet to the point of
beginning; thence leaving South Clinton Street (1) South 87° 07’ 45” West 406.03
feet to the west side of a stone bulkhead and the waters edge; thence bounding
along the west and south sides of said stone bulkhead the seven following
courses and distances: (2) South 2° 52’ 15” East 55.78 feet; (3) South 50° 29’
38” East 27.04 feet; (4) South 87° 46’ 29” East 13.67 feet; (5) North 88° 37’
12” East 48.78 feet;’ (6) North 87° 41’ 00” East 41.49 feet; (7) North 86° 00’
47” East 129.03 feet; (8) South 2° 51’ 47” East 25.63 feet; thence leaving the
Stone bulkhead (9) North 87° 07’ 45” East, 153.20 feet to intersect with the
west side of South Clinton Street; thence binding on the west side of South
Clinton Street, North 2° 52’ 15” West 100.00 feet to the place of BEGINNING,
containing 0.7867 acres of land, more or less, as surveyed by Kenneth J. Wells,
Inc. in July of 1996.

 

TRACT NO. 4

 

The following piece or parcel of land lying and being in Baltimore City,
Maryland:

 

BEGINNING for Parcel No. 14 at the point formed by the intersection of the line
of’ the east outline of the Tenth Street Dock, if projected northerly, and the
north side of Newgate Avenue, 56 feet wide, said point of beginning being
distant 996 feet, more or less, westerly, measured along the north side of said
Newgate Avenue from the west side of Newkirk Street, 60 feet wide, and running
thence binding reversely on said line so projected, southerly 56 feet, more or
less, to intersect the south side of said Newgate Avenue; thence binding on the
south side of said Newgate Avenue; South 87° 10’ 30” West 1,281 feet, more or
less, to the westernmost extremity of said Newgate Avenue; thence binding on the
westernmost extremity of said Newgate Avenue, North 02° 49’ 30” West 56.00 feet
to the north side of said Newgate Avenue and thence binding on the north side of
said Newgate Avenue, North 87° 10’ 30” East 1,281 feet, more or less, to the
BEGINNING.

 

BEGINNING for Parcel No. 2 at the point formed by the intersection of the north
side of Newgate Avenue, 56 feet wide, and the west side of Haven Street, 51 feet
wide and running thence binding in part on the west side of said Haven Street,
in part on the west side of Haven Street, 35 feet wide, and in all, North 03°
00’ 20” West 543.05 feet; thence continuing to bind on the west side of Haven
Street, 35 feet wide, the two following courses and distances; namely, by a line
curving to the left with a radius of 2850.79 feet the distance of 102.80 feet
which arc is subtended by a chord bearing North 04° 02’ 19” West 102.80 feet and
North 05° 04’ 18” West 56.75 feet; thence binding on the south side of Haven
Street, varying in width from

 

Sch. 6

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35 feet to 42 feet, South 84° 55’ 42” West 7.00 feet; thence binding on the
west, northwest, and southwest sides of Haven Street, 42 feet wide, the seven
following courses and distances; namely, North 05° 04’ 18” West 53.78 feet, by a
line curving to the right with a radius of 321.00 feet the distance of 126.19
feet which arc is subtended by a chord bearing North 06° 11’ 25” East 125.38
feet, North 17° 27’ 09” East 140.79 feet, by a line curving to the left with a
radius of 383.12 feet the distance of’85.47 feet which arc is subtended by a
chord bearing North 11° 03’ 40.5” East 85.30 feet; North 04° 40’ 12” East100.67
feet; by a line curving to the left with a radius of 165.62 feet the distance of
69.81 feet which arc is subtended by a chord bearing North 07° 24’ 17.5” West
69.29 feet and North 19° 28’ 47” West 73.50 feet to the northwest extremity of
last said Haven Street; thence binding on the northwest extremity of last said
Haven Street, North 70° 31’ 13” East 42.00 feet to the northeast side of last
said Haven Street; thence binding on the northeast, east, and southeast sides of
last said Haven Street the six following courses and distances; namely, South
19° 28’ 47” East 73.50 feet, by a fine curving to the right with a radius of
207.62 feet the distance of 87.51 feet which arc is subtended by a chord beating
South 07° 24’ 17.5” East 86.8     feet, South 04° 40’ 12” West 100.67 feet, by a
line curving to the right with a radius of 425.12 feet the distance of 94.84
feet which arc is subtended by a chord bearing South 11° 03’ 40.5” West 94.65
feet, South 17° 27’ 09” West 40.79 feet and by a line curving to the left with a
radius of 279.00 feet the distance of 109.68 feet which arc is subtended by a
chord beating South 06° 11’ 25” West 108.98 feet; thence binding in part on the
east side of last said Haven Street, in part on the east side of Haven Street,
35 feet wide, and in all, South 05° 04’ 18” East 110.53 feet; thence binding on
the east side of Haven Street, 35 feet wide, the two following courses and
distances; namely, by a line curving to the right with a radius of 2885.79 feet
the distance of 104.06 feet which arc is subtended by a chord beating South 04°
02’ 19” East 104.06 feet and South 03° 00’ 20” East 532.93 feet; thence binding
on the north side of Haven Street, varying in width from 35 feet to 51 feet,
North 86° 59’ 40” East 16.00 feet; thence binding on the eastside of Haven
Street, 51 feet wide, South 03° 00’ 20” East 10.27 feet to intersect the north
side of Newgate Avenue, mentioned firstly herein and thence binding on the north
side of Newgate Avenue, mentioned firstly herein, South 87° 10’ 30” West 51.00
feet to the place of BEGINNING.

 

Being the same real estate conveyed to Consolidation Coal Sales Company, a
Delaware corporation, by the Mayor and City Council of Baltimore, a municipal
corporation, by deed dated May 2, 1990, and recorded among the Land Records of
Baltimore City at Liber 2530, Page 400.

 

Sch. 7

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SCHEDULE 1

 

Name of Grantor

--------------------------------------------------------------------------------

  

State of Incorporation

--------------------------------------------------------------------------------

   Employer ID#

--------------------------------------------------------------------------------

   Organization ID#

--------------------------------------------------------------------------------

CNX Marine Terminals, Inc.    Delaware    25-138529    0896003

 

Sch. 8

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EXHIBIT 1.1(G)(1)

 

FORM OF

GUARANTOR JOINDER AND ASSUMPTION AGREEMENT

 

THIS GUARANTOR JOINDER AND ASSUMPTION AGREEMENT is made as of
                                        , 20    , by
                                        
                                        
                                                 , a
                                                     
[corporation/partnership/limited liability company] (the “New Guarantor”).

 

Background

 

Reference is made to (i) the Credit Agreement, dated as of June 30, 2004, as the
same may be amended, restated, supplemented or modified from time to time (the
“Credit Agreement”), by and among Consol Energy Inc., a Delaware corporation
(the “Borrower”), each of the Guarantors now or hereafter party thereto, the
Lenders now or hereafter party thereto (the “Lenders”), LaSalle Bank National
Association, Société Générale, New York Branch and SunTrust Bank, each in its
capacity as a co-documentation agent, and Citicorp North America, Inc. and PNC
Bank, National Association, in their capacity as co-administrative agents for
the Lenders (collectively, the “Co-Administrative Agents” and PNC Bank, National
Association, individually, as “Paying Agent”), (ii) the Continuing Agreement of
Guaranty and Suretyship, dated as of June 30, 2004 as the same may be amended,
restated, supplemented or modified from time to time (the “Guaranty”) of
Guarantors given to the Paying Agent as agent for the Lenders, (iii) the
Security Agreement, dated as of June 30, 2004 as the same may be amended,
restated, supplemented or modified from time to time (the “Security Agreement”)
among the Loan Parties and the Collateral Trustee for the benefit of the Paying
Agent, the Co-Administrative Agents and the Lenders, (iv) the Pledge Agreement,
dated as of June 30, 2004, as the same may be amended, restated, supplemented or
modified from time to time (the “Pledge Agreement”) among the Loan Parties and
the Collateral Trustee for the benefit of the Paying Agent, the
Co-Administrative Agents and the Lenders, (v) the Intercompany Subordination
Agreement, dated as of June 30, 2004, as the same may be amended, restated,
supplemented or modified from time to time (the “Intercompany Subordination
Agreement”) among the Loan Parties and the Paying Agent for the benefit of the
Lenders, (vi) the Patent, Trademark and Copyright Security Agreement, dated as
of June 30, 2004, as the same may be amended, restated, supplemented or modified
from time to time (the “Patent, Trademark and Copyright Security Agreement”),
among the Loan Parties and the Collateral Trustee for the benefit of the Paying
Agent, the Co-Administrative Agents and Lenders and (viii) the other Loan
Documents referred to in the Credit Agreement, as the same may be amended,
restated, supplemented or modified from time to time (the “Loan Documents”).

 

Agreement

 

Capitalized terms defined in the Credit Agreement are used herein as defined
therein.

 

New Guarantor hereby becomes a Guarantor under the terms of the Credit Agreement
and in consideration of the value of the synergistic and other benefits received
by New Guarantor as a result of being or becoming affiliated with the Borrower
and the Guarantors, New Guarantor

 

--------------------------------------------------------------------------------

hereby agrees that effective as of the date hereof it hereby is, and shall be
deemed to be, and assumes the obligations of, a “Loan Party” and a “Guarantor”,
jointly and severally under the Credit Agreement, a “Guarantor”, jointly and
severally with the existing Guarantors under the Guaranty, a “Company” jointly
and severally under the Intercompany Subordination Agreement, a “Debtor” jointly
and severally under the Security Agreement, a “Pledgor” jointly and severally
under the Pledge Agreement and the Patent, Trademark and Copyright Security
Agreement and a Loan Party or Guarantor, as the case may be, under each of the
other Loan Documents to which the Loan Parties or Guarantors are a party; and,
New Guarantor hereby agrees that from the date hereof and so long as any Loan or
any Commitment of any Lender shall remain outstanding and until the payment in
full of the Loans and the Notes, the expiration of all Letters of Credit, and
the performance of all other obligations of the Loan Parties under the Loan
Documents, New Guarantor shall perform, comply with, and be subject to and bound
by each of the terms and provisions of the Credit Agreement, Guaranty, Security
Agreement, Pledge Agreement, Intercompany Subordination Agreement, Patent,
Trademark and Copyright Security Agreement and each of the other Loan Documents
to which Guarantors and Loan Parties are parties jointly and severally with the
existing parties thereto. Without limiting the generality of the foregoing, New
Guarantor hereby represents and warrants that (i) each of the representations
and warranties set forth in Section 6 of the Credit Agreement applicable to a
Loan Party is true and correct as to New Guarantor on and as of the date hereof
and (ii) New Guarantor has heretofore received a true and correct copy of the
Credit Agreement, Guaranty, Security Agreement, Pledge Agreement, Intercompany
Subordination Agreement, Patent, Trademark and Copyright Security Agreement and
each of the other Loan Documents (including any modifications thereof or
supplements or waivers thereto) in effect on the date hereof.

 

New Guarantor hereby makes, affirms, and ratifies in favor of the Lenders and
the Paying Agent the Credit Agreement, Guaranty, Security Agreement, Pledge
Agreement, Intercompany Subordination Agreement, Patent, Trademark and Copyright
Security Agreement and each of the other Loan Documents to which New Guarantor
is becoming a party pursuant to the terms of the preceding paragraph.

 

New Guarantor is simultaneously delivering to the Collateral Trustee (with
copies sent to the Paying Agent) (i) all appropriate financing statements and
appropriate stock powers and certificates evidencing the shares, the Partnership
Interests and the LLC Interests that are part of the Pledged Collateral and (ii)
all documents required under Section 11.18 [Joinder of Guarantors] of the Credit
Agreement.

 

In furtherance of the foregoing, upon the request of the Paying Agent, New
Guarantor shall execute and deliver or cause to be executed and delivered at any
time and from time to time such further instruments and documents and do or
cause to be done such further acts as may be reasonably necessary in the
reasonable opinion of Paying Agent to carry out more effectively the provisions
and purposes of this Guarantor Joinder and Assumption Agreement and the other
Loan Documents.

 

New Guarantor acknowledges and agrees that a telecopy transmission to the Paying
Agent or any Lender of signature pages hereof purporting to be signed on behalf
of New Guarantor shall constitute effective and binding execution and delivery
hereof by New Guarantor.

 

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[SIGNATURE PAGE 1 OF 1 OF GUARANTOR

JOINDER AND ASSUMPTION AGREEMENT]

 

IN WITNESS WHEREOF, and intending to be legally bound hereby, the New Guarantor
has duly executed this Guarantor Joinder and Assumption Agreement and delivered
the same to the Paying Agent for the benefit of the Lenders, as of the date and
year first above written with the intention that this Guarantor Joinder and
Assumption Agreement constitute a sealed instrument.

 

ATTEST:

                             

By:

       (SEAL)

Name:

         

Name:

       

Title:

         

Title:

       

 

Acknowledged and accepted: PNC BANK, NATIONAL ASSOCIATION, as Paying Agent

By:

   

Name:

   

Title:

   

 

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EXHIBIT 1.1(G)(2)

 

FORM OF GUARANTY AGREEMENT

 

CONTINUING AGREEMENT OF GUARANTY AND SURETYSHIP

 

This Continuing Agreement of Guaranty and Suretyship (this “Guaranty”), dated as
of this 30th day of June, 2004, is jointly and severally given by each of the
UNDERSIGNED and each of the other Persons which become Guarantors hereunder from
time to time (each a “Guarantor” and collectively the “Guarantors”) in favor of
PNC BANK, NATIONAL ASSOCIATION, as paying agent for the Lenders (the “Paying
Agent”), in connection with that certain Credit Agreement, dated as of the date
hereof, by and among, CONSOL Energy Inc., a Delaware corporation (the
“Borrower”), the Guarantors now or hereafter party thereto, Citibank North
America, Inc. and PNC Bank, National Association in their capacity as
co-administrative agents, LaSalle Bank National Association, Société Générale,
New York Branch and SunTrust Bank, each in its capacity as a co-documentation
agent, and the Lenders now or hereafter party thereto (the “Lenders”) (as
amended, restated, modified, or supplemented from time to time hereafter, the
“Credit Agreement”). Capitalized terms not otherwise defined herein shall have
the respective meanings ascribed to them by the Credit Agreement and the rules
of construction set forth in Section 1.2 [Construction] of the Credit Agreement
shall apply to this Guaranty.

 

1. Guarantied Obligations. To induce the Paying Agent and the Lenders to make
loans and grant other financial accommodations to the Borrower under the Credit
Agreement, each Guarantor hereby jointly and severally unconditionally, and
irrevocably, guaranties to the Paying Agent and each Lender, and becomes surety,
as though it was a primary obligor for, the full and punctual payment and
performance when due (whether on demand, at stated maturity, by acceleration, or
otherwise and including any amounts which would become due but for the operation
of an automatic stay under the federal bankruptcy code of the United States or
any similar laws of any country or jurisdiction) of: (i) the payment and
performance of all Obligations, including, without limiting the generality of
the foregoing, all obligations, liabilities, and indebtedness from time to time
of the Borrower or any other Guarantor to the Paying Agent or any of the Lenders
under or in connection with the Credit Agreement or any other Loan Document or
any Specified Swap Agreement, whether for principal, interest, fees,
indemnities, expenses, or otherwise, and all refinancings or refundings thereof,
whether such obligations, liabilities, or indebtedness are direct or indirect,
secured or unsecured, joint or several, absolute or contingent, due or to become
due, whether for payment or performance, now existing or hereafter arising (and
including obligations, liabilities, and indebtedness arising or accruing after
the commencement of any bankruptcy, insolvency, reorganization, or similar
proceeding with respect to any of the Loan Parties or that would have arisen or
accrued but for the commencement of such proceeding (including without
limitation, interest after default), even if the claim for such obligation,
liability or indebtedness is not enforceable or allowable in such proceeding,
and including all Obligations, liabilities, and indebtedness arising from any
extensions of credit under or in connection with the Loan Documents or any
Specified Swap Agreement from time to time, regardless of whether any such
extensions of credit are in excess of the amount committed under

 

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or contemplated by the Loan Documents or any Specified Swap Agreement or are
made in circumstances in which any condition to extension of credit is not
satisfied), (ii) any obligation or liability of any of the Loan Parties arising
out of overdrafts on deposits or other accounts or out of electronic funds
(whether by wire transfer or through automated clearing houses or otherwise) or
out of the return unpaid of, or other failure of the Paying Agent or any Lender
to receive final payment for, any check, item, instrument, payment order or
other deposit or credit to a deposit or other account, or out of the Paying
Agent’s or any Lender’s non-receipt of or inability to collect funds or
otherwise not being made whole in connection with depository or other similar
arrangements, and (iii) any amendments, extensions, renewals and increases of or
to any of the foregoing (all of the foregoing obligations, liabilities and
indebtedness are referred to herein collectively as the “Guarantied Obligations”
and each as a “Guarantied Obligation”). Without limitation of the foregoing, any
of the Guarantied Obligations shall be and remain Guarantied Obligations
entitled to the benefit of this Guaranty if the Paying Agent or any of the
Lenders (or any one or more assignees or transferees thereof) from time to time
assign or otherwise transfer all or any portion of their respective rights and
obligations under the Loan Documents, or any other Guarantied Obligations, to
any other Person as provided by the Loan Documents or by the Specified Swap
Agreements. In furtherance of the foregoing, each Guarantor jointly and
severally agrees as follows:

 

2. Guaranty. Each Guarantor hereby promises to pay and perform all such
Guarantied Obligations when due and payable immediately upon demand of the
Paying Agent and the Lenders or any one or more of them. All payments made
hereunder shall be made by each Guarantor in immediately available funds in U.S.
Dollars and shall be made without setoff, counterclaim, withholding, or other
deduction of any nature.

 

3. Obligations Absolute. The obligations of the Guarantors hereunder shall not
be discharged or impaired or otherwise diminished by any failure, default,
omission, or delay, willful or otherwise, by any Lender, the Paying Agent, or
the Borrower or any other obligor on any of the Guarantied Obligations, or by
any other act or thing or omission or delay to do any other act or thing which
may or might in any manner or to any extent vary the risk of any Guarantor or
would otherwise operate as a discharge of any Guarantor as a matter of law or
equity, except for, and to the extent of, payment and performance of the
Guaranteed Obligations. Each of the Guarantors agrees that the Guarantied
Obligations will be paid and performed strictly in accordance with the terms of
the Loan Documents and the Specified Swap Agreements. Without limiting the
generality of the foregoing, each Guarantor hereby consents to, at any time and
from time to time, and the joint and several obligations of each Guarantor
hereunder shall not be diminished, terminated, or otherwise similarly affected
by any of the following:

 

(a) Any lack of genuineness, legality, validity, enforceability or allowability
(in a bankruptcy, insolvency, reorganization or similar proceeding, or
otherwise), or any avoidance or subordination, in whole or in part, of any Loan
Document or any of the Guarantied Obligations and regardless of any law,
regulation or order now or hereafter in effect in any jurisdiction affecting any
of the Guarantied Obligations, any of the terms of the Loan Documents or
Specified Swap Agreements, or any rights of the Paying Agent or the Lenders or
any other Person with respect thereto;

 

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(b) Any increase, decrease, or change in the amount, nature, type or purpose of
any of, or any release, surrender, exchange, compromise or settlement of the
Guarantied Obligations (whether or not contemplated by the Loan Documents or
Specified Swap Agreements as presently constituted); any change in the time,
manner, method, or place of payment or performance of, or in any other term of,
any of the Guarantied Obligations; any execution or delivery of any additional
Loan Documents or Specified Swap Agreements; or any amendment, modification or
supplement to, or refinancing or refunding of, any Loan Document or any of the
Guarantied Obligations;

 

(c) Any failure to assert any breach of or default under any Loan Document or
any of the Guarantied Obligations; any extensions of credit in excess of the
amount committed under or contemplated by the Loan Documents or Specified Swap
Agreements, or in circumstances in which any condition to such extensions of
credit has not been satisfied; any other exercise or non-exercise, or any other
failure, omission, breach, default, delay, or wrongful action in connection with
any exercise or non-exercise, of any right or remedy against the Borrower or any
other Person under or in connection with any Loan Document or any of the
Guarantied Obligations; any refusal of payment or performance of any of the
Guarantied Obligations, whether or not with any reservation of rights against
any Guarantor; or any application of collections (including but not limited to
collections resulting from realization upon any direct or indirect security for
the Guarantied Obligations) to other obligations, if any, not entitled to the
benefits of this Guaranty, in preference to Guarantied Obligations entitled to
the benefits of this Guaranty, or if any collections are applied to Guarantied
Obligations, any application to particular Guarantied Obligations;

 

(d) Any taking, exchange, amendment, modification, waiver, supplement,
termination, subordination, compromise, release, surrender, loss, or impairment
of, or any failure to protect, perfect, or preserve the value of, or any
enforcement of, realization upon, or exercise of rights, or remedies under or in
connection with, or any failure, omission, breach, default, delay, or wrongful
action by the Paying Agent or the Lenders, or any of them, or any other Person
in connection with the enforcement of, realization upon, or exercise of rights
or remedies under or in connection with, or, any other action or inaction by any
of the Paying Agent or the Lenders, or any of them, or any other Person in
respect of, any direct or indirect security for any of the Guarantied
Obligations. As used in this Guaranty, “direct or indirect security” for the
Guarantied Obligations, and similar phrases, includes any collateral security,
guaranty, suretyship, letter of credit, capital maintenance agreement, put
option, subordination agreement, or other right or arrangement of any nature
providing direct or indirect assurance of payment or performance of any of the
Guarantied Obligations, made by or on behalf of any Person;

 

(e) Any merger, consolidation, liquidation, dissolution, winding-up, charter
revocation, or forfeiture, or other change in, restructuring or termination of
the corporate structure or existence of, the Borrower or any other Person; any
bankruptcy, insolvency, reorganization or similar proceeding with respect to the
Borrower or any other Person; or any action taken or election made by the Paying
Agent or the Lenders, or any of them (including but not limited to any election
under Section 1111(b)(2) of the United States Bankruptcy Code), the Borrower, or
any other Person in connection with any such proceeding;

 

3

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(f) Any defense, setoff, or counterclaim which may at any time be available to
or be asserted by the Borrower or any other Person with respect to any Loan
Document or any of the Guarantied Obligations, other than, and to the extent of,
payment and performance of the Guaranteed Obligations; or any discharge by
operation of law or release of the Borrower or any other Person from the
performance or observance of any Loan Document or any of the Guarantied
Obligations; and

 

(g) Any other event or circumstance, whether similar or dissimilar to the
foregoing, and whether known or unknown, which might otherwise constitute a
defense available to, or limit the liability of, any Guarantor, a guarantor or a
surety, excepting only full, strict, and indefeasible payment and performance of
the Guarantied Obligations in full.

 

Each Guarantor acknowledges, consents, and agrees that new Guarantors may join
in this Guaranty pursuant to Section 11.18 of the Credit Agreement and each
Guarantor affirms that its obligations shall continue hereunder undiminished.

 

4. Waivers, etc. Each of the Guarantors hereby waives any defense to (other
than, and to the extent of, the defense of prior payment of the Guaranteed
Obligations) or limitation on its obligations under this Guaranty arising out of
or based on any event or circumstance referred to in Section 3 hereof. Without
limitation and to the fullest extent permitted by applicable law, each Guarantor
waives each of the following:

 

(a) Except as may be expressly contemplated by the Credit Agreement or other
Loan Documents or Specified Swap Agreements, all notices, disclosures and demand
of any nature which otherwise might be required from time to time to preserve
intact any rights against any Guarantor, including the following: any notice of
any event or circumstance described in Section 3 hereof; any notice required by
any law, regulation or order now or hereafter in effect in any jurisdiction; any
notice of nonpayment, nonperformance, dishonor, or protest under any Loan
Document or any of the Guarantied Obligations; any notice of the incurrence of
any Guarantied Obligation; any notice of any default or any failure on the part
of the Borrower or any other Person to comply with any Loan Document or any of
the Guarantied Obligations or any direct or indirect security for any of the
Guarantied Obligations; and any notice of any information pertaining to the
business, operations, condition (financial or otherwise) or prospects of the
Borrower or any other Person;

 

(b) Any right to any marshalling of assets, to the filing of any claim against
the Borrower or any other Person in the event of any bankruptcy, insolvency,
reorganization or similar proceeding, or to the exercise against the Borrower or
any other Person of any other right or remedy under or in connection with any
Loan Document or any of the Guarantied Obligations or any direct or indirect
security for any of the Guarantied Obligations; any requirement of promptness or
diligence on the part of the Paying Agent or the Lenders, or any of them, or any
other Person; any requirement to exhaust any remedies under or in connection
with, or to mitigate the damages resulting from default under, any Loan Document
or any of the Guarantied Obligations or any direct or indirect security for any
of the Guarantied Obligations; any benefit of any statute of limitations; and
any requirement of acceptance of this Guaranty or any other Loan

 

4

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Document or Specified Swap Agreement, and any requirement that any Guarantor
receive notice of any such acceptance;

 

(c) Any defense or other right arising by reason of any law now or hereafter in
effect in any jurisdiction pertaining to election of remedies (including but not
limited to anti-deficiency laws, “one action” laws or the like), or by reason of
any election of remedies or other action or inaction by the Paying Agent or the
Lenders, or any of them (including but not limited to commencement or completion
of any judicial proceeding or nonjudicial sale or other action in respect of
collateral security for any of the Guarantied Obligations), which results in
denial or impairment of the right of the Paying Agent or the Lenders, or any of
them, to seek a deficiency against the Borrower or any other Person or which
otherwise discharges or impairs any of the Guarantied Obligations; and

 

(d) Any and all defenses it may now or hereafter have based on principles of
suretyship, impairment of collateral, or the like.

 

5. Reinstatement. This Guaranty is a continuing obligation of the Guarantors and
shall remain in full force and effect notwithstanding that no Guarantied
Obligations may be outstanding from time to time and notwithstanding any other
event or circumstance. Upon termination of all Commitments, the expiration of
all Letters of Credit and Specified Swap Agreements, the payment in full of all
Guaranteed Obligations, the termination of the Credit Agreement and provided
that none of the other obligations referred to in Section 1(ii) are then in
default, this Guaranty shall terminate; provided, however, that this Guaranty
shall continue to be effective or be reinstated, as the case may be, any time
any payment of any of the Guarantied Obligations is rescinded, recouped,
avoided, or must otherwise be returned or released by any Lender or the Paying
Agent upon or during the insolvency, bankruptcy, or reorganization of, or any
similar proceeding affecting, the Borrower or for any other reason whatsoever,
all as though such payment had not been made and was due and owing.

 

6. Subrogation. Each Guarantor waives and agrees that it will not exercise any
rights against the Borrower or any other Guarantor arising in connection with,
or any Collateral securing, the Guarantied Obligations (including rights of
subrogation, contribution, and the like) until the Guarantied Obligations have
been paid in full, and all Commitments have been terminated and all Letters of
Credit and Specified Swap Agreements have expired. If any amount shall be paid
to any Guarantor by or on behalf of the Borrower or any other Guarantor by
virtue of any right of subrogation, contribution, or the like, such amount shall
be deemed to have been paid to such Guarantor for the benefit of, and shall be
held in trust for the benefit of, the Paying Agent and the Lenders and shall
forthwith be paid to the Paying Agent to be credited and applied upon the
Guarantied Obligations, whether matured or unmatured, in accordance with the
terms of the Credit Agreement.

 

7. No Stay. Without limitation of any other provision of this Guaranty, if any
declaration of default or acceleration or other exercise or condition to
exercise of rights or remedies under or with respect to any Guarantied
Obligation shall at any time be stayed, enjoined, or prevented for any reason
(including but not limited to stay or injunction resulting from the pendency
against the Borrower or any other Person of a bankruptcy, insolvency,
reorganization or

 

5

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similar proceeding), the Guarantors agree that, for the purposes of this
Guaranty and their obligations hereunder, the Guarantied Obligations shall be
deemed to have been declared in default or accelerated, and such other exercise
or conditions to exercise shall be deemed to have been taken or met.

 

8. Taxes.

 

(a) No Deductions. All payments made by any Guarantor under any of the Loan
Documents or Specified Swap Agreements shall be made free and clear of and
without deduction for any present or future taxes, levies, imposts, deductions,
charges, or withholdings, and all liabilities with respect thereto, excluding
taxes imposed on the net income of any Lender and all income and franchise taxes
of the United States applicable to any Lender (all such non-excluded taxes,
levies, imposts, deductions, charges, withholdings, and liabilities being
hereinafter referred to as “Taxes”). If any Guarantor shall be required by law
to deduct any Taxes from or in respect of any sum payable under any of the Loan
Documents or Specified Swap Agreements, (i) the sum payable shall be increased
as may be necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this Subsection (a) such
Lender receives an amount equal to the sum it would have received had no such
deductions been made, (ii) such Guarantor shall make such deductions and (iii)
such Guarantor shall timely pay the full amount deducted to the relevant tax
authority or other authority in accordance with applicable law.

 

(b) Stamp Taxes. In addition, each Guarantor agrees to pay any present or future
stamp or documentary taxes or any other excise or property taxes, charges, or
similar levies which arise from any payment made hereunder or from the
execution, delivery, or registration of, or otherwise with respect to, any of
the Loan Documents or Specified Swap Agreements (hereinafter referred to as
“Other Taxes”).

 

(c) Indemnification for Taxes Paid by any Lender. Each Guarantor shall indemnify
each Lender for the full amount of Taxes or Other Taxes (including, without
limitation, any Taxes or Other Taxes imposed by any jurisdiction on amounts
payable under this Subsection) paid by any Lender and any liability (including
penalties, interest, and expenses) arising therefrom or with respect thereto,
whether or not such Taxes or Other Taxes were correctly or legally asserted.
This indemnification shall be made within thirty (30) days from the date a
Lender makes written demand therefor.

 

(d) Certificate. Within thirty (30) days after the date of any payment of any
Taxes by any Guarantor, such Guarantor shall furnish to each Lender, the
original or a certified copy of a receipt evidencing payment thereof. If no
Taxes are payable in respect of any payment by such Guarantor, such Guarantor
shall, if so requested by a Lender, provide a certificate of an officer of such
Guarantor to that effect.

 

9. Intentionally Deleted.

 

10. Notices. Each Guarantor agrees that all notices, statements, requests,
demands and other communications under this Guaranty shall be given to such
Guarantor at the address set

 

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forth on a Schedule to, or in a Guarantor Joinder given under, the Credit
Agreement and in the manner provided in Section 11.6 of the Credit Agreement.
The Paying Agent and the Lenders may rely on any notice (whether or not made in
a manner contemplated by this Guaranty) purportedly made by or on behalf of a
Guarantor, and the Paying Agent and the Lenders shall have no duty to verify the
identity or authority of the Person giving such notice.

 

11. Counterparts; Telecopy Signatures. This Guaranty may be executed by
different parties hereto on any number of separate counterparts, each of which,
when so executed and delivered, shall be an original, and all such counterparts
shall together constitute one and the same instrument. Delivery of an executed
signature page by telecopy or electronic signature delivery system (in either
case in a form acceptable to the Paying Agent) shall be effective as delivery of
a manually executed signature page to this Guaranty.

 

12. Setoff, Default Payments by Borrower.

 

(a) In the event that at any time any obligation of the Guarantors now or
hereafter existing under this Guaranty shall have become due and payable, the
Paying Agent and the Lenders, or any of them, shall have the right from time to
time, without notice to any Guarantor, to set off against and apply to such due
and payable amount any obligation of any nature of any Lender or the Paying
Agent, or any subsidiary or affiliate of any Lender or the Paying Agent, to any
Guarantor, including but not limited to all deposits (whether time or demand,
general or special, provisionally credited or finally credited, however
evidenced) now or hereafter maintained by any Guarantor with the Paying Agent or
any Lender or any subsidiary or affiliate thereof. Such right shall be absolute
and unconditional in all circumstances and, without limitation, shall exist
whether or not the Paying Agent or the Lenders, or any of them, shall have given
any notice or made any demand under this Guaranty or under such obligation to
the Guarantor, whether such obligation to the Guarantor is absolute or
contingent, matured or unmatured (it being agreed that the Paying Agent and the
Lenders, or any of them, may deem such obligation to be then due and payable at
the time of such setoff), and regardless of the existence or adequacy of any
collateral, guaranty, or other direct or indirect security or right or remedy
available to the Paying Agent or any of the Lenders. The rights of the Paying
Agent and the Lenders under this Section are in addition to such other rights
and remedies (including, without limitation, other rights of setoff and banker’s
lien) which the Paying Agent and the Lenders, or any of them, may have, and
nothing in this Guaranty or in any other Loan Document or Specified Swap
Agreement shall be deemed a waiver of or restriction on the right of setoff or
banker’s lien of the Paying Agent and the Lenders, or any of them. Each of the
Guarantors hereby agrees that, to the fullest extent permitted by law, any
affiliate or subsidiary of the Paying Agent or any of the Lenders and any holder
of a participation in any obligation of any Guarantor under this Guaranty, shall
have the same rights of setoff as the Paying Agent and the Lenders as provided
in this Section (regardless whether such affiliate or participant otherwise
would be deemed a creditor of the Guarantor).

 

(b) Upon the occurrence and during the continuation of any default under any
Guarantied Obligation, if any amount shall be paid to any Guarantor by or for
the account of the Borrower, such amount shall be held in trust for the benefit
of each Lender and the Paying Agent and shall forthwith be paid to the Paying
Agent to be credited and applied to the Guarantied Obligations when due and
payable.

 

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13. Construction. The section and other headings contained in this Guaranty are
for reference purposes only and shall not affect interpretation of this Guaranty
in any respect. This Guaranty has been fully negotiated between the applicable
parties, each party having the benefit of legal counsel, and accordingly neither
any doctrine of construction of guaranties or suretyships in favor of the
guarantor or surety, nor any doctrine of construction of ambiguities in
agreement or instruments against the party controlling the drafting thereof,
shall apply to this Guaranty.

 

14. Successors and Assigns. This Guaranty shall be binding upon each Guarantor,
its successors and assigns, and shall inure to the benefit of and be enforceable
by the Paying Agent and the Lenders, or any of them, and their successors and
assigns except that no Guarantor may assign or transfer any of its rights or
obligations hereunder or any interest herein other than assignments and
transfers permitted by the Credit Agreement. Without limitation of the
foregoing, the Paying Agent and the Lenders, or any of them (and any successive
assignee or transferee), from time to time may assign or otherwise transfer all
or any portion of its rights or obligations under the Loan Documents (including
all or any portion of any commitment to extend credit), or any other Guarantied
Obligations, to any other Person as provided and permitted by the Credit
Agreement and such Guarantied Obligations (including any Guarantied Obligations
resulting from extension of credit by such other Person under or in connection
with the Loan Documents or Specified Swap Agreements) shall be and remain
Guarantied Obligations entitled to the benefit of this Guaranty, and to the
extent of its interest in such Guarantied Obligations such other Person shall be
vested with all the benefits in respect thereof granted to the Paying Agent and
the Lenders in this Guaranty or otherwise.

 

15. Governing Law; Submission to Jurisdiction; Waiver of Jury Trial.

 

(a) Governing Law. This Guaranty shall be governed by, construed, and enforced
in accordance with the internal laws of the Commonwealth of Pennsylvania,
without regard to its conflict of laws principles.

 

(b) Certain Waivers; Submission to Jurisdiction.

 

(i) Each Guarantor hereby irrevocably consents to the nonexclusive jurisdiction
of the Court of Common Pleas of Allegheny County and the United States District
Court for the Western District of Pennsylvania, and waives personal service of
any and all process upon it and consents that all such service of process be
made by certified or registered mail directed to it at the address provided for
in Section 11.6 of the Credit Agreement and service so made shall be deemed to
be completed upon actual receipt thereof. Each Guarantor waives any objection to
jurisdiction and venue of any action instituted against it as provided herein
and agrees not to assert any defense based on lack of jurisdiction or venue.

 

(ii) Each Guarantor hereby waives any objection to jurisdiction and venue of any
action instituted against it as provided herein and agrees not to assert any
defense based on lack of jurisdiction or venue.

 

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(iii) EACH GUARANTOR, THE PAYING AGENT AND EACH LENDER (BY ITS ACCEPTANCE OF THE
BENEFITS OF THIS GUARANTY) HEREBY WAIVES TRIAL BY JURY IN ANY ACTION, SUIT,
PROCEEDING, OR COUNTERCLAIM OF ANY KIND ARISING OUT OF OR RELATED TO THIS
GUARANTY, THE CREDIT AGREEMENT, OR ANY OTHER LOAN DOCUMENT TO THE FULL EXTENT
PERMITTED BY LAW.

 

16. Severability; Modification to Conform to Law.

 

(a) The provisions of this Guaranty are intended to be severable. If any
provision of this Guaranty shall be held invalid or unenforceable in whole or in
part in any jurisdiction, such provision shall, as to such jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without in any
manner affecting the validity or enforceability thereof in any other
jurisdiction or the remaining provisions hereof in any jurisdiction.

 

(b) Without limitation of the preceding Subsection (a), to the extent that
applicable law (including applicable laws pertaining to fraudulent conveyance or
fraudulent or preferential transfer) otherwise would render the full amount of
the Guarantor’s obligations hereunder invalid, voidable, or unenforceable on
account of the amount of a Guarantor’s aggregate liability under this Guaranty,
then, notwithstanding any other provision of this Guaranty to the contrary, the
aggregate amount of such liability shall, without any further action by the
Paying Agent or any of the Lenders or such Guarantor or any other Person, be
automatically limited and reduced to the highest amount which is valid and
enforceable as determined in such action or proceeding, which (without limiting
the generality of the foregoing) may be an amount which is equal to the greater
of:

 

(i) the fair consideration actually received by such Guarantor under the terms
and as a result of the Loan Documents and the Specified Swap Agreements and the
value of the benefits described in Section 19(b) hereof, including (and to the
extent not inconsistent with applicable federal and state laws affecting the
enforceability of guaranties) distributions, commitments, and advances made to
or for the benefit of such Guarantor with the proceeds of any credit extended
under the Loan Documents or the Specified Swap Agreements, or

 

(ii) the excess of (1) the amount of the fair value of the assets of such
Guarantor as of the date of this Guaranty as determined in accordance with
applicable federal and state laws governing determinations of the insolvency of
debtors as in effect on the date hereof, over (2) the amount of all liabilities
of such Guarantor as of the date of this Guaranty, also as determined on the
basis of applicable federal and state laws governing the insolvency of debtors
as in effect on the date hereof.

 

(c) Notwithstanding anything to the contrary in this Section or elsewhere in
this Guaranty, this Guaranty shall be presumptively valid and enforceable to its
full extent in accordance with its terms, as if this Section (and references
elsewhere in this Guaranty to enforceability to the fullest extent permitted by
law) were not a part of this Guaranty, and in any related litigation the burden
of proof shall be on the party asserting the invalidity or

 

9

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unenforceability of any provision hereof or asserting any limitation on any
Guarantor’s obligations hereunder as to each element of such assertion.

 

17. Additional Guarantors. At any time after the initial execution and delivery
of this Guaranty to the Paying Agent and the Lenders, additional Persons may
become parties to this Guaranty and thereby acquire the duties and rights of
being Guarantors hereunder by executing and delivering to the Paying Agent and
the Lenders a Guarantor Joinder pursuant to the Credit Agreement. No notice of
the addition of any Guarantor shall be required to be given to any pre-existing
Guarantor and each Guarantor hereby consents thereto.

 

18. Joint and Several Obligations. The obligations and additional liabilities of
each and every Guarantor under this Guaranty are joint and several obligations
of the Guarantors, and each Guarantor hereby waives to the full extent permitted
by law any defense it may otherwise have to the payment and performance of the
Obligations that its liability hereunder is limited and not joint and several.
Each Guarantor acknowledges and agrees that the foregoing waivers and those set
forth below serve as a material inducement to the agreement of the Paying Agent
and the Lenders to make the Loans, and that the Paying Agent and the Lenders are
relying on each specific waiver and all such waivers in entering into this
Guaranty. The undertakings of each Guarantor hereunder secure the obligations of
itself and the other Guarantors. The Paying Agent and the Lenders, or any of
them, may, in their sole discretion, elect to enforce this Guaranty against any
Guarantor without any duty or responsibility to pursue any other Guarantor and
such an election by the Paying Agent and the Lenders, or any of them, shall not
be a defense to any action the Paying Agent and the Lenders, or any of them, may
elect to take against any Guarantor. Each of the Lenders and the Paying Agent
hereby reserve all rights against each Guarantor.

 

19. Receipt of Credit Agreement, Other Loan Documents, Benefits.

 

(a) Each Guarantor hereby acknowledges that it has received a copy of the Credit
Agreement and the other Loan Documents and each Guarantor certifies that the
representations and warranties made therein with respect to such Guarantor are
true and correct. Further, each Guarantor acknowledges and agrees to perform,
comply with, and be bound by all of the provisions of the Credit Agreement and
the other Loan Documents.

 

(b) Each Guarantor hereby acknowledges, represents, and warrants that it
receives synergistic benefits by virtue of its affiliation with the Borrower and
the other Guarantors and that it will receive direct and indirect benefits from
the financing arrangements contemplated by the Credit Agreement and that such
benefits, together with the rights of contribution and subrogation that may
arise in connection herewith are a reasonably equivalent exchange of value in
return for providing this Guaranty.

 

20. Release of Guarantor. In the event that all of the capital stock or other
ownership interests of any Guarantor is sold or otherwise disposed of or
liquidated and such sale or other disposition or liquidation has been approved
in writing by Paying Agent (as contemplated by Section 10.20 of the Credit
Agreement) or the Lenders (as required by Section 11.1.4 of the Credit
Agreement), such Guarantor shall, upon consummation of such sale or other
disposition, be released from this Guaranty automatically and without further
action, and this Guaranty shall,

 

10

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as to such Guarantor, terminate and have no further force or effect. In
connection with the merger of the Guarantor into another Loan Party, this
Guaranty will be assumed (as a matter of law) by such other Loan Party and will,
together with any Guaranty of the Guarantied Obligations by such other Loan
Party, constitute a single Guaranty.

 

21. Miscellaneous.

 

(a) Generality of Certain Terms. As used in this Guaranty, the terms “hereof”,
“herein” and terms of similar import refer to this Guaranty as a whole and not
to any particular term or provision.

 

(b) Amendments, Waivers. No amendment to or waiver of any provision of this
Guaranty, and no consent to any departure by any Guarantor herefrom, shall in
any event be effective unless in a writing manually signed by or on behalf of
the Paying Agent and the Lenders. Any such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given. No
delay or failure of the Paying Agent or the Lenders, or any of them, in
exercising any right or remedy under this Guaranty shall operate as a waiver
thereof; nor shall any single or partial exercise of any such right or remedy
preclude any other or further exercise thereof or the exercise of any other
right or remedy. The rights and remedies of the Paying Agent and the Lenders
under this Guaranty are cumulative and not exclusive of any other rights or
remedies available hereunder, under any other agreement or instrument, by law,
or otherwise.

 

(c) Telecommunications. Each Lender and the Paying Agent shall be entitled to
rely on the authority of any individual making any telecopy or telephonic
notice, request, or signature without the necessity of receipt of any
verification thereof.

 

(d) Expenses. Each Guarantor unconditionally agrees to pay all costs and
expenses, including reasonable attorney’s fees, incurred by the Paying Agent or
any of the Lenders in enforcing this Guaranty against any Guarantor and each
Guarantor shall pay and indemnify each Lender and the Paying Agent for, and hold
it harmless from and against, any and all obligations, liabilities, losses,
damages, costs, expenses (including disbursements and reasonable legal fees of
counsel to any Lender or the Paying Agent), penalties, judgments, suits,
actions, claims, and disbursements imposed on, asserted against, or incurred by
any Lender or the Paying Agent (i) relating to the preparation, negotiation,
execution, administration, or enforcement of or collection under this Guaranty
or any document, instrument, or agreement relating to any of the Obligations,
including in any bankruptcy, insolvency, or similar proceeding in any
jurisdiction or political subdivision thereof; (ii) relating to any amendment,
modification, waiver, or consent hereunder or relating to any telecopy or
telephonic transmission purporting to be by any Guarantor or the Borrower; (iii)
in any way relating to or arising out of this Guaranty, or any document,
instrument, or agreement relating to any of the Guarantied Obligations, or any
action taken or omitted to be taken by any Lender or the Paying Agent hereunder,
and including those arising directly or indirectly from the violation or
asserted violation by any Guarantor or the Borrower or the Paying Agent or any
Lender of any law, rule, regulation, judgment, order, or the like of any
jurisdiction or political subdivision thereof (including those relating to
environmental protection, health, labor, importing, exporting, or safety) and
regardless whether asserted by any governmental entity or any other Person.

 

11

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(e) Prior Understandings. This Guaranty and the Credit Agreement supersede all
prior understandings and agreements, whether written or oral, between the
parties hereto and thereto and relating to the transactions provided for herein
and therein.

 

(f) Survival. All representations and warranties of the Guarantors made in
connection with this Guaranty shall survive, and shall not be waived by, the
execution and delivery of this Guaranty, any investigation by or knowledge of
the Paying Agent and the Lenders, or any of them, any extension of credit, or
any other event or circumstance whatsoever.

 

[SIGNATURE PAGE FOLLOWS]

 

12

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[SIGNATURE PAGE - CONTINUING AGREEMENT OF GUARANTY AND

SURETYSHIP]

 

IN WITNESS WHEREOF, each Guarantor, intending to be legally bound, has executed
this Guaranty as of the date first above written with the intention that this
Guaranty shall constitute a sealed instrument.

 

GUARANTORS: [INSERT]

By:

     

(SEAL)

Name:

   

Title:

   

 

13

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EXHIBIT 1.1(I)(1)

 

FORM OF INDEMNITY

 

REGULATED SUBSTANCES CERTIFICATE AND INDEMNITY AGREEMENT

 

THIS REGULATED SUBSTANCES CERTIFICATE AND INDEMNITY AGREEMENT (the “Agreement”)
is made as of the 30th day of June, 2004 by CONSOL ENERGY INC., a Delaware
corporation (the “Borrower”), each GUARANTOR (as defined in the Credit
Agreement, as herein defined) (collectively, the “Guarantors” and the Borrower
and the Guarantors collectively, the “Loan Parties” and each individually, a
“Loan Party”) in favor of WILMINGTON TRUST COMPANY, a Delaware banking
corporation, not in its individual capacity but solely as Corporate Trustee, and
DAVID A. VANASKEY, an individual, not in his individual capacity but solely as
Individual Trustee (the Corporate Trustee and the Individual Trustee,
collectively, the “Collateral Trustee”) for the ratable benefit of the Secured
Parties (as defined in the Collateral Trust Agreement (as defined below))
pursuant to the Collateral Trust Agreement.

 

RECITALS

 

A. Pursuant to that certain Credit Agreement (as it may hereafter from time to
time be restated, amended, modified or supplemented, the “Credit Agreement”) of
even date herewith by and among the Borrower, the Guarantors now or hereafter
party thereto, the Lenders now or hereafter party thereto (the “Lenders”),
LaSalle Bank National Association., Société Générale, New York Branch and
SunTrust Bank, each in its capacity as a co-documentation agent, and Citicorp
North America, Inc. and PNC Bank, National Association, as Co-Administrative
Agents (the “Co-Administrative Agents”), the Co-Administrative Agents and the
Lenders have agreed to make certain loans to the Borrower (the “Loans”) and
grant other financial accommodations to the Borrower, which Loans and other
financial accommodations are secured by, among other things, various mortgages,
deeds of trust, and credit line deeds of trust encumbering certain of real
estate interests (collectively, the “Property”) of the Loan Parties in favor of
the Collateral Trustee for the ratable benefit of the Secured Parties (each of
the said various mortgages, deeds of trust, credit line deeds of trust, deeds to
secure debts and other security documents encumbering the Property, together
with all amendments, modifications, consolidations, increases, supplements and
spreaders thereof, being herein collectively called the “Mortgages”).

 

B. Pursuant to the Credit Agreement and that certain Issuing and Paying Agency
Agreement, dated December 31, 1991, among the Borrower, certain of its
Subsidiaries (as defined in the Credit Agreement) and The Bank of Nova Scotia
Trust Company of New York as successor-in-interest to Morgan Guaranty Trust
Company of New York, as paying agent (as supplemented, modified, amended or
restated from time to time, the “Issuing and Paying Agency Agreement”), and that
certain Indenture, dated March 7, 2002, among the Borrower, certain of its
Subsidiaries and The Bank of Nova Scotia Trust Company of New York, as trustee
(as supplemented, modified, amended or restated from time to time, the
“Indenture”), the Collateral Trustee has entered into that certain Collateral
Trust Agreement, dated of even date herewith (as supplemented, modified, amended
or restated from time to time, the “Collateral Trust

 

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Agreement”) with the Borrower and the Designated Subsidiaries (as defined
therein) to accept the grant of the lien under the Mortgages as security for the
Secured Debt (as defined in the Collateral Trust Agreement) for the ratable
benefit of the Creditors.

 

C. To induce the Co-Administrative Agents and the Lenders to make the Loans and
grant other financial accommodations to the Borrower, each Loan Party has agreed
to enter into this Agreement in favor of the Collateral Trustee for the ratable
benefit of the Secured Parties.

 

NOW, THEREFORE, in consideration of the premises and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, and
intending to be legally bound, each Loan Party hereby covenants, warrants,
represents and agrees as follows:

 

1. Definitions. All capitalized terms used herein but not otherwise defined
herein shall have the meaning given such terms in the Credit Agreement.

 

2. Representations and Warranties. The Loan Parties, each for themselves
respectively, and as applicable to each such Loan Party’s ownership, occupation
or leasing of or conducting operations and activities at any Property, hereby
reaffirm the representations and warranties set forth in Section 6.1.25
[Environmental Matters] of the Credit Agreement and hereby further represent and
warrant, except as disclosed on Schedule 6.1.25 to the Credit Agreement:

 

(a) The Loan Parties have not used Regulated Substances on, from or affecting
the Property in any manner which violates Environmental Laws, and, to the
knowledge of each of the Loan Parties, no prior owner of the Property or any
existing or prior tenant, subtenant or occupant of the Property has used
Regulated Substances on, from or affecting the Property in any manner which
violates Environmental Laws, except in each case where such use, considered
either individually or in the aggregate, has no reasonable likelihood of
materially disrupting the Gas and Coal Operations or materially diminishing the
fair market value of the Collateral, taken as a whole, or otherwise resulting in
a Material Adverse Change.

 

(b) Except for matters that, considered either individually or in the aggregate,
have no reasonable likelihood of materially disrupting the Gas and Coal
Operations or materially diminishing the fair market value of the Collateral,
taken as a whole, or otherwise resulting in a Material Adverse Change, no Loan
Party has received any Environmental Complaint; and no Responsible Officer of
any Loan Party has knowledge of any facts or circumstances that would give it
reason to believe that it might receive any material Environmental Complaint.

 

(c) None of the Property is shown on any list of contaminated properties
maintained by any Official Body.

 

3. Environmental Covenants.

 

(a) Each Loan Party, for themselves respectively, and as applicable to each such
Loan Party’s ownership, occupation or leasing of or conducting operations and
activities at any Property, shall keep the Property free of Regulated Substances
and Contamination and shall remove, or cause their lessees to remove, all
Regulated Substances and Contamination which are

 

2

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now or at any time in the future in or on the Property, irrespective of the
source thereof, except to the extent that such Regulated Substances are present
on or stored and/or used substantially in compliance with Environmental Laws.
Each Loan Party, for themselves respectively, and as applicable to each such
Loan Party’s ownership, occupation or leasing of or conducting operations and
activities at any Property, shall not suffer or permit the Property to be used
to generate, manufacture, refine, transport, treat, dispose of, transfer,
produce or process Regulated Substances in violation of Environmental Laws;
provided, that it shall not be deemed to be a violation of this Section 3(a)
unless or until any failure to comply with any applicable Environmental Law
would result in fines, penalties, remediation costs, other similar liabilities
or injunctive relief which, considered either individually or in the aggregate,
are reasonably likely to materially disrupt the Gas and Coal Operations or
materially diminish the fair market value of the Collateral, taken as a whole,
or otherwise result in a Material Adverse Change.

 

(b) Each Loan Party, for themselves respectively, and as applicable to each such
Loan Party’s ownership, occupation or leasing of or conducting operations and
activities at any Property, shall immediately, upon their respective Responsible
Officer obtaining knowledge of any of the following, notify the Collateral
Trustee for the benefit of Secured Parties in writing upon the occurrence of:

 

(i) the release of any Regulated Substance or Contamination on or about the
Property in violation of Environmental Laws that might reasonably be expected to
result in fines, penalties, remediation costs, other similar liabilities or
injunctive relief which, considered either individually or in the aggregate, are
reasonably likely to materially disrupt Gas and Coal Operations or materially
diminish the fair market value of the Collateral, taken as a whole, or otherwise
result in a Material Adverse Change;

 

(ii) receipt by such Loan Party or any tenant, subtenant or other occupant of
the Property of any Environmental Complaint if the subject of such Environmental
Complaint is reasonably likely to result in fines, penalties, remediation costs,
other similar liabilities or injunctive relief which, considered either
individually or in the aggregate, are reasonably likely to materially disrupt
Gas and Coal Operations or materially diminish the fair market value of the
Collateral, taken as a whole, or otherwise result in a Material Adverse Change;

 

(iii) any violation affecting the Property of any Environmental Laws, if such
violation is reasonably likely to result in fines, penalties, remediation costs,
other similar liabilities or injunctive relief which, considered either
individually or in the aggregate, are reasonably likely to materially disrupt
the Gas and Coal Operations or materially diminish the fair market value of the
Collateral, taken as a whole, or otherwise result in a Material Adverse Change;
and

 

(iv) any claim or claims (including but not limited to Environmental Complaints)
made against or the Property relating to damage, contribution, cost of recovery,
compensation, loss or injury resulting from any Regulated Substance or
Contamination affecting the Property if such claim or series of claims, when
considered either individually or in the aggregate, are reasonably likely to
materially disrupt the Gas

 

3

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and Coal Operations or materially diminish the fair market value of the
Collateral, taken as a whole, or otherwise result in a Material Adverse Change.

 

(c) Except as otherwise disclosed in written reports delivered to the Collateral
Trustee prior to the date hereof, the Loan Parties certify that, as of the date
of this Agreement, to their knowledge, no report, analysis, study or other
document prepared by or for any Person exists which identifies any Regulated
Substances or Contamination as being located upon or as being released or
discharged from the Property.

 

(d) The Loan Parties, at their sole expense and for themselves respectively, and
as applicable to each such Loan Party’s ownership, occupation or leasing of or
conducting operations and activities at any Property, shall, or shall cause the
tenants of the Property to, conduct and complete all investigations, studies,
sampling and testing and all removal and other actions necessary to clean up and
remove all Regulated Substances and Contamination on, under, from or affecting
any of the Property in accordance with all Environmental Laws; provided, however
that it shall not be deemed to be a violation of this Section 3(d) unless or
until any failure to conduct and complete all investigations, studies, sampling
and testing and all removal and other actions is reasonably likely to result in
fines, penalties, remediation costs or other similar liabilities which,
considered either individually or in the aggregate, would have a reasonable
likelihood of materially disrupting the Gas and Coal Operations or materially
diminishing the fair market value of the Collateral, taken as a whole, or
otherwise resulting in a Material Adverse Change. The Loan Parties, for
themselves respectively, and as applicable to each such Loan Party’s ownership,
occupation or leasing of or conducting operations and activities at any
Property, shall and shall cause any tenants of the Property to at all times keep
the Property free of any lien imposed by any Environmental Laws.

 

4. Indemnity.

 

(a) The Loan Parties shall indemnify, defend and hold harmless the Collateral
Trustee, the Secured Parties and their employees, agents, officers and directors
from and against any claims, demands, penalties, fines, liabilities,
settlements, damages, reasonable costs or expenses of whatever kind or nature,
including reasonable attorneys’ fees, fees of environmental consultants and
laboratory fees, known or unknown, contingent or otherwise (collectively,
“Indemnified Matters”), arising out of or in any way related to the following
matters:

 

(i) the presence, disposal, release or threatened release of any Regulated
Substances or Contamination on, over, under, from or affecting the Property or
the soil, water, vegetation, buildings, personal property, persons or animals
thereon;

 

(ii) any personal injury (including wrongful death) or property damage (real or
personal) arising out of or related to such Regulated Substances or
Contamination;

 

(iii) any lawsuit brought or threatened, settlement reached or governmental
order relating to such Regulated Substances or Contamination with respect to the
Property;

 

4

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(iv) any violation of Environmental Laws or Required Environmental Permits;
and/or

 

(v) the breach of any warranty, representation or covenant of any Loan Party
contained in this Agreement.

 

(b) The liability covered by this Section 4 shall include, but not be limited
to, losses sustained by the Collateral Trustee and the Secured Parties and/or
their successors and assigns for (i) diminution in value of the Property
resulting from matters covered by this Agreement, (ii) amounts arising out of
personal injury or death claims with respect to the matters covered by this
Agreement, (iii) amounts charged for any environmental or Contamination or
Regulated Substances cleanup costs and expenses, liens or other such charges or
impositions, (iv) payment for reasonable attorneys’ fees and disbursements,
expert witness fees, court costs, environmental tests and design studies in
connection with the matters covered by this Agreement, and (v) any other amounts
reasonably expended by the Collateral Trustee and the Secured Parties and their
successors and assigns with respect to matters covered by this Agreement.

 

5. Each Loan Party’s Obligation to Deliver Property. Each Loan Party agrees for
themselves respectively, and as applicable to each such Loan Party’s ownership,
occupation or leasing of or conducting operations and activities at any Property
that, in the event any Mortgage is foreclosed (whether judicially or by power of
sale) or any such Loan Party tenders a deed in lieu of foreclosure or any such
Loan Party otherwise voluntarily or involuntarily conveys possession of or title
to the Property, such Loan Party shall deliver the Property or any parcel
comprising such portion of the Property to the Collateral Trustee free of any
and all Regulated Substances or Contamination which violate any applicable
Environmental Laws affecting the Property. The obligations of each Loan Party as
set forth in this paragraph are strictly for the benefit of the Collateral
Trustee and the Secured Parties and any successors and assigns of the Collateral
Trustee and the Secured Parties as holders of any portion of the Secured Debt
and shall not in any way impair or affect the Collateral Trustee’s and/or the
Secured Parties’ right to foreclose against any parcel comprising a portion of
the Property.

 

6. The Collateral Trustee’s and/or Secured Parties’ Rights Under This Agreement.
The rights of the Collateral Trustee and the Secured Parties under this
Agreement shall be in addition to all rights of the Collateral Trustee and/or
the Secured Parties under the Mortgages, the Credit Agreement, any other Loan
Documents, the Issuing and Paying Agency Agreement and the Indenture. Any
default by any Loan Party under this Agreement (including without limitation any
breach of any representation, warranty or covenant made by any Loan Party in
this Agreement) shall, at the Collateral Trustee’s option, constitute an
Actionable Default under the Collateral Trust Agreement and an Event of Default
under the Credit Agreement, the Mortgages and the other Loan Documents.

 

7. The Collateral Trustee’s and/or the Secured Parties’ Right to Cure. In
addition to the other remedies provided to the Collateral Trustee and/or the
Secured Parties in the Credit Agreement, the Mortgages, the other Loan
Documents, the Issuing and Paying Agency Agreement and the Indenture, should any
Loan Party fail to abide by the terms and covenants of this Agreement, the
Collateral Trustee on behalf of the Secured Parties and/or the Secured Parties

 

5

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may, should they elect to do so in order to protect their security interest,
cause the removal, remediation or cleanup of any Regulated Substances or
Contamination located on the Property and repair and remedy any damage to the
Property caused by the Regulated Substances or Contamination or any such
removal, remediation or cleanup, as necessary to assure substantial compliance
with all applicable Environmental Laws. In such event, all funds expended by the
Collateral Trustee on behalf of the Secured Parties and/or the Secured Parties
in connection with the removal of such Regulated Substances or Contamination or
the cleanup of such Regulated Substances or Contamination, including but not
limited to all attorneys’ fees, engineering fees, consultant fees and similar
charges, shall become a part of the obligation secured by the Mortgages and
shall be due and payable by each of the Loan Parties on demand. Each
disbursement made by the Collateral Trustee and/or the Secured Parties pursuant
to this provision shall bear interest at the lower of (a) the rate of interest
applicable under Section 4.3.2 [Other Obligations] of the Credit Agreement, or
(b) the highest rate allowable under applicable laws from the date any Loan
Party shall have received written notice that the funds have been advanced by
the Collateral Trustee and/or the Secured Parties until paid in full. The
Borrower and each of the other Loan Parties shall permit the Collateral Trustee,
the Secured Parties, and their agents and employees access to its respective
Property (or in the case of the Borrower any and all Properties) for any purpose
consistent with this provision.

 

8. The Collateral Trustee’s Right to Conduct an Investigation. In the event the
Secured Parties shall have reasonable cause to suspect that any Loan Party has
failed to comply with the terms of this Agreement, the Collateral Trustee may
obtain one or more environmental audits of the Property, at any Loan Party’s
sole expense. The nature and scope of the environmental audits shall be
determined by the Collateral Trustee in its judgment. Each Loan Party shall
permit the Collateral Trustee for the benefit of the Secured Parties and the
Collateral Trustee’s agents and employees access to the Property for the purpose
of conducting the environmental audit and shall otherwise cooperate and provide
such additional information as may be requested by the Collateral Trustee or the
Collateral Trustee’s agents and employees. In the event any Loan Party fails to
pay in accordance with this Section 8 for the cost of any such environmental
audit, the Secured Parties may pay for same. Each such payment made by the
Secured Parties shall become a part of the indebtedness secured by the
Mortgages, shall be due and payable upon demand and shall bear interest after
demand at the lower of either (a) the rate of interest applicable under Section
4.3.2 [Other Obligations] of the Credit Agreement, or (b) the highest rate
allowable under applicable laws, until paid in full by any Loan Party.

 

9. Scope of Liability. The liability under this Agreement shall in no way be
limited or impaired by (a) any extension of time for performance required by the
Credit Agreement, any of the Loan Documents, the Issuing and Paying Agent
Agreement or the Indenture, (b) any exculpatory provisions in any of the Loan
Documents, the Issuing and Paying Agent Agreement or the Indenture limiting the
Collateral Trustee’s and/or the Secured Parties’ recourse, (c) the accuracy or
inaccuracy of the representations and warranties made by any Loan Party or any
other obligor under the Credit Agreement, any of the Loan Documents, the Issuing
and Paying Agent Agreement or the Indenture, (d) the release of any Loan Party
or any other Person from performance or observance of any of the agreements,
covenants, terms or conditions contained in any of the Loan Documents, the
Issuing and Paying Agent Agreement or the Indenture by operation of law, the
Collateral Trustee’s and/or the Secured Parties’ voluntary act or otherwise,

 

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(e) the release or substitution, in whole or in part, of any security for any
Loan Party’s obligations or (f) the Collateral Trustee’s failure to record any
of the Mortgages or file any UCC financing statements (or the Collateral
Trustee’s improper recording or filing of any thereof) or to otherwise perfect,
protect, secure or insure any security interest or lien given as security for
any Loan Party’s obligations; and, in any such case, whether with or without
notice to any Loan Party or other Person and with or without consideration. The
indemnity provided in Section 4 above shall survive (i) any sale, assignment or
foreclosure of any of the Mortgages or other Loan Documents, the acceptance of a
deed in lieu of foreclosure or trustee’s sale, or any sale or transfer of all or
part of the possession of or title to the Property, or (ii) the discharge of any
of the other Loan Documents, the Issuing and Paying Agent Agreement or the
Indenture and/or the reconveyance or release of any of the Mortgages.

 

10. Preservation of Rights. No delay on the Collateral Trustee’s and/or the
Secured Parties’ part in exercising any right, power or privilege under this
Agreement shall operate as a waiver of any such privilege, power or right.

 

11. Notices. All notices hereunder shall be in writing and shall be deemed to
have been sufficiently given or served for all purposes when sent by registered
or certified mail to any Loan Party or the Co-Administrative Agents and/or the
Lenders as provided in Section 11.6 [Notices] of the Credit Agreement and in the
case of the Collateral Trustee, as provided in Section 7.2 of the Collateral
Trust Agreement.

 

12. Changes in Writing. No provision of this Agreement may be changed, waived,
discharged or terminated orally, by telephone or by any other means, except by
an instrument in writing signed by all parties hereto.

 

13. Joint and Several Obligations. With respect to the obligations of each Loan
Party in connection with this Agreement, the Borrower and each Guarantor are
jointly and severally liable hereunder. Any party liable upon or in respect of
this Agreement or any obligations under any of the other Loan Documents, the
Issuing and Paying Agent Agreement or the Indenture may be released without
affecting the liability of any party not so released.

 

14. Survival. The obligations of each of the Loan Parties under Section 4 of
this Agreement shall survive any judicial foreclosure, foreclosure by power of
sale, deed in lieu of foreclosure, transfer of possession of or title to the
Property by any Loan Party or Secured Parties and payment of the Secured Debt in
full.

 

15. Severability. In the event any one or more of the provisions contained in
this Agreement should be invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions, or any
portions thereof, shall not in any way be affected or impaired thereby.

 

16. Governing Law and Jurisdiction. This Agreement and the rights and
obligations of the parties hereunder shall in all respects be governed by,
construed and enforced in accordance with the governing laws as set forth in the
Credit Agreement; provided, however, that the applicable federal, state and
local Environmental Laws of the jurisdiction in which the Property is

 

7

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situated shall govern the Loan Parties’ obligations with respect to compliance
with Environmental Laws, and Required Environmental Permits. Each of the Loan
Parties and the Collateral Trustee hereby irrevocably submit to the personal
jurisdiction of any Commonwealth of Pennsylvania or federal court sitting in the
Commonwealth of Pennsylvania and the Delaware state and United States District
Courts located in Wilmington, Delaware over any suit, action or proceeding
arising out of or relating to this Agreement.

 

17. Construction. Unless the context of this Agreement otherwise clearly
requires, the rules of construction set forth in Section 1.2 [Construction] of
the Credit Agreement shall apply to this Agreement and are incorporated herein
by reference.

 

18. Counterparts. This Agreement may be executed in any one or more
counterparts, each of which shall be deemed an original document and all of
which shall be deemed the same document.

 

19. WAVIER OF JURY TRIAL.

 

EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES ANY AND ALL RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN ANY ACTION, PROCEEDING OR CLAIM OF ANY NATURE BASED UPON OR
RELATING TO THIS AGREEMENT, THE SUBJECT MATTER OF THIS AGREEMENT, ANY DOCUMENTS
EXECUTED IN CONNECTIONS WITH THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED IN
ANY OF SUCH DOCUMENTS. THIS WAIVER IS KNOWINGLY, INTENTIONALLY AND VOLUNTARILY
MADE BY THE PARTIES HERETO AND EACH OF THE PARTIES HERETO ACKNOWLEDGES THAT
NEITHER THE OTHER PARTIES HERETO NOR ANY PERSON ACTING ON BEHALF OF ANY OF THEM
HAS OR HAVE MADE ANY REPRESENTATIONS OF FACT TO INDUCE THIS WAIVER OF TRIAL BY
JURY OR IN ANY WAY TO MODIFY OR NULLIFY ITS EFFECT. EACH OF THE PARTIES HERETO
FURTHER ACKNOWLEDGES THAT IT HAS BEEN REPRESENTED (OR HAS HAD THE OPPORTUNITY TO
BE REPRESENTED) IN THE SIGNING OF THIS AGREEMENT AND IN THE MAKING OF THIS
WAIVER BY INDEPENDENT LEGAL COUNSEL, SELECTED BY ITS OWN FREE WILL AND THAT EACH
OF THE PARTIES TO THIS AGREEMENT HAS HAD THE OPPORTUNITY TO DISCUSS THIS WAIVER
WITH COUNSEL. EACH OF THE PARTIES TO THIS AGREEMENT FURTHER ACKNOWLEDGES THAT IT
HAS READ AND THAT IT FULLY UNDERSTAND THE MEANING OF THIS PROVISION.

 

20. The parties agree that in the event of any conflict between the provisions
of this Agreement and the provisions of the Collateral Trust Agreement, the
provisions of the Collateral Trust Agreement shall control. Notwithstanding any
provision in this Agreement to the contrary, the parties and signatories hereto
acknowledge and agree that any and all rights, powers, privileges, duties,
responsibilities, liabilities and/or obligations (including but not limited to
the right to grant or withhold consent and the right to act or refrain from
acting), whether discretionary or mandatory, are and shall be exercised by the
Collateral Trustee solely in accordance with the terms and conditions of the
Collateral Trust Agreement, at the direction of

 

8

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the Credit Facility Agent (as defined in the Collateral Trust Agreement) or
other entity specified in the Collateral Trust Agreement as having the right to
give direction to the Collateral Trustee, and subject further to the rights of
the Collateral Trustee to require officers’ certificate(s), opinion(s) and
advice from counsel, accountants, appraisers and other third parties,
advancement of expenses and/or assurances of indemnity satisfactory to the
Collateral Trustee.

 

[SIGNATURE PAGE FOLLOWS]

 

9

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[SIGNATURE PAGE - REGULATED SUBSTANCES

CERTIFICATE AND INDEMNITY AGREEMENT]

 

IN WITNESS WHEREOF, intending to be legally bound hereby, the undersigned have
executed this Agreement as of the day and year first above written.

 

Witness/Attest:

      CONSOL ENERGY INC.         By:                

Name:

               

Title:

                [INSERT GUARANTORS]

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE - REGULATED SUBSTANCES

CERTIFICATE AND INDEMNITY AGREEMENT]

 

Witness/Attest:

     

WILMINGTON TRUST COMPANY, as

Corporate Trustee

        By:                

Name:

               

Title:

   

Witness/Attest:

                                  David A. Vanaskey, as Individual Trustee

 

11

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EXHIBIT 1.1(I)(2)

 

FORM OF

INTERCOMPANY SUBORDINATION AGREEMENT

 

THIS INTERCOMPANY SUBORDINATION AGREEMENT is dated as of June 30, 2004 and is
made by and among CONSOL ENERGY INC., a Delaware corporation (“CEI”), each
GUARANTOR (as defined in the Credit Agreement, as herein defined), each Person
who hereafter becomes a Subsidiary of CEI (CEI and each Guarantor being
individually referred to herein as a “Company” and collectively as the
“Companies”), and PNC BANK, NATIONAL ASSOCIATION, as paying agent (the “Paying
Agent”), for the Lenders (as defined in the Credit Agreement).

 

WITNESSETH THAT:

 

WHEREAS, pursuant to the Credit Agreement by and among CEI, the Guarantors now
or hereafter party thereto, the Lenders now or hereafter party thereto, LaSalle
Bank NATIONAL ASSOCIATION, Société Générale, New York Branch and SunTrust Bank,
each in its capacity as a co-documentation agent, and Citibank North America,
Inc. and PNC Bank, National Association in their capacity as co-administrative
agents, dated as of the date hereof (as it may be hereafter amended, restated,
supplemented or otherwise modified from time to time, the “Credit Agreement” and
each capitalized term used herein shall, unless otherwise defined herein, have
the meaning specified in the Credit Agreement), the Lenders intend to make Loans
to, and issue Letters of Credit on behalf of, the Borrower and its Subsidiaries;
and

 

WHEREAS, the Companies have or, in the future, may have liabilities, obligations
or indebtedness owed to each other (the liabilities, obligations and
indebtedness of each of the Companies to any other Company, now existing or
hereafter incurred (whether created directly or acquired by assignment or
otherwise), and interest and premiums, if any, thereon and other amounts payable
in respect thereof and all other obligations and other amounts payable by any
Company to any other Company are hereinafter collectively referred to as the
“Subordinated Indebtedness”); and

 

WHEREAS, the obligations of the Lenders to maintain the Commitments and make
Loans to, and issue Letters of Credit on behalf of, the Borrower and its
Subsidiaries from time to time are subject to the condition, among others, that
the Companies subordinate the Subordinated Indebtedness to the Obligations of
the Borrower or any other Company to the Paying Agent or the Lenders pursuant to
the Credit Agreement, the other Loan Documents or any Specified Swap Agreement
(collectively, the “Senior Debt”) in the manner set forth herein.

 

NOW, THEREFORE, intending to be legally bound hereby, the parties hereto
covenant and agree as follows:

 

1. Subordinated Indebtedness Subordinated to Senior Debt. The recitals set forth
above are hereby incorporated by reference. All Subordinated Indebtedness shall
be subordinate

 

--------------------------------------------------------------------------------

and subject in right of payment to the prior payment in full, in cash, of all
Senior Debt pursuant to the provisions contained herein.

 

2. Payment Over of Proceeds Upon Dissolution, Etc. Upon any distribution of
assets of any Company in the event of (a) any insolvency or bankruptcy case or
proceeding, or any receivership, liquidation, reorganization or other similar
case or proceeding in connection therewith, relative to any such Company or to
its creditors, as such, or to its assets, or (b) any liquidation, dissolution or
other winding up of any such Company, whether voluntary or involuntary and
whether or not involving insolvency or bankruptcy, or (c) any assignment for the
benefit of creditors or any marshalling of assets and liabilities of any such
Company (a Company distributing assets as set forth herein being referred to in
such capacity as a “Distributing Company”), then and in any such event, the
Paying Agent shall be entitled to receive, for the benefit of the Paying Agent
and the Lenders as their respective interests may appear, payment in full, in
cash, of all amounts due or to become due (whether or not an Event of Default
has occurred under the terms of the Loan Documents or the Senior Debt has been
declared due and payable prior to the date on which it would otherwise have
become due and payable) on or in respect of any and all Senior Debt before the
holder of any Subordinated Indebtedness owed by the Distributing Company is
entitled to receive any payment on account of the principal of or interest on
such Subordinated Indebtedness, and, to that end, the Paying Agent shall be
entitled to receive, for application to the payment of the Senior Debt, any
payment or distribution of any kind or character, whether in cash, property or
securities, which may be payable or deliverable in respect of the Subordinated
Indebtedness owed by the Distributing Company in any such case, proceeding,
dissolution, liquidation or other winding up event.

 

3. No Commencement of Any Proceeding. Each Company agrees that, so long as the
Senior Debt shall remain unpaid, it will not commence, or join with any creditor
other than the Lenders and the Paying Agent in commencing, any proceeding,
including but not limited to those described in Section 2 hereof, or other
enforcement action of any kind against any other Company which owes it any
Subordinated Indebtedness.

 

4. Prior Payment of Senior Debt Upon Acceleration of Subordinated Indebtedness.
If any portion of the Subordinated Indebtedness owed by any Company becomes or
is declared due and payable before its stated maturity, then and in such event
the Paying Agent and the Lenders shall be entitled to receive payment in full,
in cash, of all amounts due and to become due on or in respect of the Senior
Debt (whether or not an Event of Default has occurred under the terms of the
Loan Documents or the Senior Debt has been declared due and payable prior to the
date on which it would otherwise have become due and payable) before the holder
of any such Subordinated Indebtedness is entitled to receive any payment
thereon.

 

5. No Payment When Senior Debt in Default. With respect to Subordinated
Indebtedness for borrowed money, if any Event of Default shall have occurred and
be continuing, or such an Event of Default would result from or exist after
giving effect to a payment with respect to any portion of the Subordinated
Indebtedness, unless the Required Lenders shall have consented to or waived the
same, so long as any of the Senior Debt shall remain outstanding, no payment
shall be made by any Company owing Subordinated Indebtedness on account of
principal or interest on any portion of the Subordinated Indebtedness for
borrowed money. No payment

 

2

--------------------------------------------------------------------------------

shall be made by any Company owing any Subordinated Indebtedness other than for
borrowed money of such Subordinated Indebtedness after the earlier of (i) any
proceeding described in clause (a) or (c) of Section 2 hereof or (ii) the
declaration of the Senior Debt as due and payable before its stated maturity.

 

6. Payment Permitted if No Default. Nothing contained in this Agreement shall
prevent any of the Companies, at any time except during the pendency of any of
the conditions described in Sections 2, 4 and 5, from making the regularly
scheduled payments of principal of or interest on any portion of the
Subordinated Indebtedness, or the retention thereof by any of the Companies of
any money deposited with them for the payment of or on account of the principal
of or interest on the Subordinated Indebtedness.

 

7. Receipt of Prohibited Payments. If, notwithstanding the foregoing provisions
of Sections 2, 4, 5 and 6, a Company which is owed Subordinated Indebtedness by
a Distributing Company shall have received any payment or distribution of assets
from the Distributing Company of any kind or character, whether in cash,
property or securities, then and in such event such payment or distribution
shall be held in trust for the benefit of the Paying Agent and the Lenders as
their respective interests may appear, shall be segregated from other funds and
property held by such Company, and shall be forthwith paid over to the Paying
Agent in the same form as so received (with any necessary endorsement) to be
applied (in the case of cash) to or held as collateral (in the case of noncash
property or securities) for the payment or prepayment of the Senior Debt in
accordance with the terms of the Credit Agreement and the other Loan Documents
and the Specified Swap Agreements.

 

8. Rights of Subrogation. Each Company agrees that no payment or distribution to
the Paying Agent or the Lenders pursuant to the provisions of this Agreement
shall entitle it to exercise any rights of subrogation in respect thereof until
the Senior Debt shall have been paid in full and the Commitments shall have
terminated and all of the Letters of Credit and Specified Swap Agreements have
expired.

 

9. Instruments Evidencing Subordinated Indebtedness. Each Company shall cause
each instrument for borrowed money which now or hereafter evidences all or a
portion of the Subordinated Indebtedness to be conspicuously marked as follows:

 

“This instrument is subject to the terms of an Intercompany Subordination
Agreement dated as of June 30, 2004 in favor of PNC BANK, NATIONAL ASSOCIATION,
as Paying Agent for the Lenders referred to therein, which Intercompany
Subordination Agreement is incorporated herein by reference. Notwithstanding any
contrary statement contained in the within instrument, no payment on account of
the principal thereof or interest thereon shall become due or payable except in
accordance with the express terms of said Intercompany Subordination Agreement.”

 

Each Company will further mark its books of account in such a manner as shall be
effective to give proper notice of the effect of this Agreement.

 

3

--------------------------------------------------------------------------------

10. Agreement Solely to Define Relative Rights. The purpose of this Agreement is
solely to define the relative rights of the Companies, on the one hand, and the
Paying Agent and the Lenders, on the other hand. Nothing contained in this
Agreement is intended to or shall impair, as between any of the Companies and
their creditors other than the Paying Agent and the Lenders, the obligation of
the Companies to each other to pay the principal of and interest on the
Subordinated Indebtedness as and when the same shall become due and payable in
accordance with its terms, or is intended to or shall affect the relative rights
among the Companies and their creditors other than the Paying Agent and the
Lenders, nor shall anything herein prevent any of the Companies from exercising
all remedies otherwise permitted by applicable Law upon default under any
agreement pursuant to which the Subordinated Indebtedness is created, subject to
the rights, if any, under this Agreement of the Paying Agent and the Lenders to
receive cash, property or securities otherwise payable or deliverable with
respect to the Subordinated Indebtedness.

 

11. No Implied Waivers of Subordination. No right of the Paying Agent or any
Lender to enforce subordination, as herein provided, shall at any time in any
way be prejudiced or impaired by any act or failure to act on the part of any
Company or by any act or failure to act by the Paying Agent or any Lender, or by
any non-compliance by any Company with the terms, provisions and covenants of
any agreement pursuant to which the Subordinated Indebtedness is created,
regardless of any knowledge thereof with which the Paying Agent or any Lender
may have or be otherwise charged. Each Company by its acceptance hereof shall
agree that, so long as there is Senior Debt outstanding or Commitments in effect
under the Credit Agreement, such Company shall not agree to sell, assign,
pledge, encumber or otherwise dispose of, or agree to compromise, the
obligations of the other Companies with respect to their Subordinated
Indebtedness, other than in accordance with the terms of the Credit Agreement,
without the prior written consent of the Required Lenders.

 

Without in any way limiting the generality of the foregoing paragraph, the
Paying Agent or any of the Lenders may, at any time and from time to time,
without the consent of or notice to any of the Companies except CEI to the
extent provided in the Credit Agreement, without incurring responsibility to any
of the Companies and without impairing or releasing the subordination provided
in this Agreement or the obligations hereunder of the Companies to the Paying
Agent and the Lenders, do any one or more of the following: (i) change the
manner, place or terms of payment, or extend the time of payment, renew or alter
the Senior Debt or otherwise amend or supplement the Senior Debt or the Loan
Documents; (ii) sell, exchange, release or otherwise deal with any property
pledged, mortgaged or otherwise securing the Senior Debt; (iii) release any
Person liable in any manner for the payment or collection of the Senior Debt;
and (iv) exercise or refrain from exercising any rights against any of the
Companies and any other person.

 

12. Additional Subsidiaries of CEI. The Companies covenant and agree that they
shall cause Subsidiaries of CEI created or acquired after the date of this
Agreement and any other Subsidiaries required to join this Agreement to join in
this Agreement and subordinate, to the Senior Debt, all Subordinated
Indebtedness owed to any such Subsidiary by any of the Companies or by any other
Subsidiary hereafter created or acquired, with such joinder, to the extent that
any such additional Subsidiary of CEI is also required to be a Guarantor under
the Credit Agreement, to be a New Guarantor under the Guarantor Joinder in the
form of Exhibit 1.1(G)(1) to the Credit Agreement, and with such joinder, to the
extent that any such additional Subsidiary of CEI is not

 

4

--------------------------------------------------------------------------------

required to be a Guarantor under the Credit Agreement, to be a joinder in form
and substance acceptable to the Paying Agent.

 

13. Continuing Force and Effect. This Agreement shall continue in force until
all of the Senior Debt is paid in full in cash, the Commitments have terminated
and no Letter of Credit under the Credit Agreement remains outstanding, it being
contemplated that this Agreement be of a continuing nature.

 

14. Modification, Amendments or Waivers. Any and all agreements amending or
changing any provision of this Agreement or the rights of the Paying Agent or
the Lenders hereunder, and any and all waivers or consents to Events of Default
or other departures from the due performance of any Company hereunder, shall be
made only by written agreement, waiver or consent signed by the Paying Agent,
acting on behalf of all the Lenders, with the written consent of the Required
Lenders, any such agreement, waiver or consent made with such written consent
being effective to bind all the Lenders.

 

15. Expenses. The Companies, unconditionally and jointly and severally, agree
upon demand to pay to the Paying Agent and the Lenders the amount of any and all
reasonable out-of-pocket costs, expenses and disbursements for which
reimbursement is customarily obtained, including reasonable fees and expenses of
counsel as set forth in Section 11.3 of the Credit Agreement.

 

16. Severability. The provisions of this Agreement are intended to be severable.
If any provision of this Agreement shall be held invalid or unenforceable in
whole or in part in any jurisdiction, such provision shall, as to such
jurisdiction, be ineffective to the extent of such invalidity or
unenforceability without in any manner affecting the validity or enforceability
thereof in any other jurisdiction or the remaining provisions hereof in any
jurisdiction.

 

17. Governing Law. This Agreement shall be deemed to be a contract under the
Laws of the Commonwealth of Pennsylvania and for all purposes shall be governed
by and construed and enforced in accordance with the internal laws of the
Commonwealth of Pennsylvania without regard to its conflict of laws principles.

 

18. Successors and Assigns. This Agreement shall inure to the benefit of the
Paying Agent and the Lenders and their respective successors and assigns, and
the obligations of each Company shall be binding upon their respective
successors and permitted assigns, except that no Company may assign or transfer
its rights or obligations hereunder or any interest herein other than
assignments and transfers permitted by the Credit Agreement. Except as permitted
by the Credit Agreement, the duties and obligations of the Companies may not be
delegated or transferred by the Companies or any Company without the prior
written consent of the Required Lenders, and any such delegation or transfer
without such consent shall be null and void. Except to the extent otherwise
required by the context of this Agreement, the word “Lenders” when used herein
shall include, without limitation, any holder of a Note or an assignment of
rights therein originally issued to a Lender under the Credit Agreement, and
each such holder of a Note or assignment shall have the benefits of this
Agreement to the same extent as if such holder had originally been a Lender
under the Credit Agreement.

 

5

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19. Joint and Several Obligations. Each of the obligations of each and every
Company under this Agreement is joint and several. The Paying Agent and the
Lenders, or any of them, may, in their sole discretion, elect to enforce this
Agreement against any Company without any duty or responsibility to pursue any
other Company and such an election by the Paying Agent and the Lenders, or any
of them, shall not be a defense to any action the Paying Agent and the Lenders,
or any of them, may elect to take against any Company. Each of the Lenders and
the Paying Agent hereby reserve all right against each Company.

 

20. Counterparts. This Agreement may be executed by the different parties hereto
on any number of separate counterparts, each of which, when executed and
delivered, shall be deemed an original, and all such counterparts shall together
constitute one and the same instrument.

 

21. Attorneys-in-Fact. Each Company hereby authorizes and empowers the Paying
Agent, at the election of the Paying Agent and in the name of either the Paying
Agent, for the benefit of the Paying Agent and the Lenders as their respective
interests may appear, or in the name of each such Company as is owed
Subordinated Indebtedness, upon the occurrence and during the continuance of an
Event of Default, to execute and file proofs and documents and take any other
action the Paying Agent may deem advisable to completely protect the Paying
Agent’s and the Lenders’ interests in the Subordinated Indebtedness and the
right of the Paying Agent and the Lenders of enforcement thereof, and to that
end each of the Companies hereby irrevocably makes, constitutes and appoints the
Paying Agent, its officers, employees and agents, or any of them, with full
power of substitution, as the true and lawful attorney-in-fact and agent of such
Company, and with full power for such Company, and in the name, place and stead
of such Company for the purpose of carrying out the provisions of this Agreement
and upon the occurrence and during the continuance of an Event of Default,
taking any action and executing, delivering, filing and recording any
instruments which the Paying Agent may deem necessary or advisable to accomplish
the purposes hereof, which power of attorney, being given for security, is
coupled with an interest and is irrevocable. Each Company hereby ratifies and
confirms, and agrees to ratify and confirm, all action taken by the Paying
Agent, its officers, employees or agents pursuant to the foregoing power of
attorney.

 

22. Application of Payments. In the event any payments are received by the
Paying Agent under the terms of this Agreement for application to the Senior
Debt at any time when the Senior Debt has not been declared due and payable and
prior to the date on which it would otherwise become due and payable, such
payment shall constitute a voluntary prepayment of the Senior Debt for all
purposes under the Credit Agreement.

 

23. Remedies. In the event of a breach by any of the Companies in the
performance of any of the terms of this Agreement, the Paying Agent, on behalf
of the Lenders, may demand specific performance of this Agreement and seek
injunctive relief and may exercise any other remedy available at law or in
equity, it being recognized that the remedies of the Paying Agent on behalf of
the Lenders at law may not fully compensate the Paying Agent on behalf of the
Lenders for the damages they may suffer in the event of a breach hereof.

 

6

--------------------------------------------------------------------------------

24. Consent to Jurisdiction; Waiver of Jury Trial. EACH COMPANY HEREBY
IRREVOCABLY CONSENTS TO THE NONEXCLUSIVE JURISDICTION OF THE COURT OF COMMON
PLEAS OF ALLEGHENY COUNTY AND THE UNITED STATES DISTRICT COURT FOR THE WESTERN
DISTRICT OF PENNSYLVANIA, AND WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS
UPON IT AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS BE MADE BY CERTIFIED OR
REGISTERED MAIL DIRECTED TO SUCH COMPANY AT THE ADDRESSES PROVIDED FOR IN
SECTION 26 HEREOF AND SERVICE SO MADE SHALL BE DEEMED TO BE COMPLETED UPON
ACTUAL RECEIPT THEREOF. EACH COMPANY WAIVES ANY OBJECTION TO JURISDICTION AND
VENUE OF ANY ACTION INSTITUTED AGAINST IT AS PROVIDED HEREIN AND AGREES NOT TO
ASSERT ANY DEFENSE BASED ON LACK OF JURISDICTION OR VENUE.

 

EACH COMPANY HEREBY WAIVES TRIAL BY JURY IN ANY ACTION, SUIT, PROCEEDING OR
COUNTERCLAIM OF ANY KIND ARISING OUT OF OR RELATED TO THIS AGREEMENT TO THE FULL
EXTENT PERMITTED BY LAW.

 

25. Waiver of Jury Trial. EXCEPT AS PROHIBITED BY LAW, EACH COMPANY, THE PAYING
AGENT AND THE LENDERS HEREBY WAIVE TRIAL BY A JURY IN ANY ACTION, SUIT,
PROCEEDING OR COUNTERCLAIM OF ANY KIND ARISING OUT OF OR RELATED TO THIS
AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE COLLATERAL TO THE FULLEST EXTENT
PERMITTED BY LAW.

 

26. Notices. All notices, statements, requests and demands and other
communications given to or made upon the Companies, the Paying Agent or the
Lenders in accordance with the provisions of this Agreement shall be given or
made in the manner as provided in Section 11.6 [Notices] of the Credit
Agreement.

 

27. Rules of Construction. The rules of construction set forth in Section 1.2
[Construction] of the Credit Agreement shall apply to this Agreement.

 

[SIGNATURE PAGE FOLLOWS]

 

7

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[SIGNATURE PAGE - INTERCOMPANY SUBORDINATION AGREEMENT]

 

WITNESS the due execution hereof as of the day and year first above written.

 

BORROWER: CONSOL ENERGY INC.

By:

   

Name:

   

Title:

   

 

GUARANTORS: [INSERT]

 

8

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[SIGNATURE PAGE - INTERCOMPANY SUBORDINATION AGREEMENT]

 

PAYING AGENT: PNC BANK, NATIONAL ASSOCIATION, as Paying Agent

By:

   

Name:

  Christopher N. Moravec

Title:

  Senior Vice President

 

9

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Exhibit 1.1(M)

 

OPEN-END MORTGAGE, SECURITY AGREEMENT, ASSIGNMENT OF RENTS

AND LEASES, FINANCING STATEMENT AND FIXTURE FILING (PENNSYLVANIA)

(THIS MORTGAGE SECURES FUTURE ADVANCES)

 

by and from

 

                                         .

“Mortgagor”

 

to

 

DAVID A. VANASKEY,

not in his individual capacity, but solely as Collateral Trustee, pursuant to
that certain Collateral Trust Agreement dated as of June 30, 2004, for the
benefit of (i) the Collateral Trustees (as defined in such Collateral Trust
Agreement), (ii) the Lenders under the Credit Agreement, (iii) the holders of
the Senior Notes (1991) and the Senior Notes (2002), and (iv) any other Persons
from time to time holders of the Secured Debt (as all such terms are hereinafter
defined) “Mortgagee”

 

Dated June 14, 2004, effective June 30, 2004 Location: County: State: I HEREBY
CERTIFY THAT THE
PRECISE ADDRESS OF MORTGAGEE IS:

David A. Vanaskey, as Collateral Trustee

c/o Wilmington Trust Company

Rodney Square North

1100 North Market Street

Wilmington, DE 19890

By:         Agent

 

NOTE TO RECORDER: THIS MORTGAGE CONSTITUTES A FIXTURE FILING AND COVERS AS-

EXTRACTED COLLATERAL UNDER THE UCC (AS DEFINED HEREIN) AND IS TO BE CROSS-

REFERENCED IN THE UCC RECORDS.

 

THE SECURED PARTY (MORTGAGEE) DESIRES THIS FIXTURE FILING AND FINANCING

STATEMENT COVERING AS-EXTRACTED COLLATERAL TO BE INDEXED AGAINST THE

RECORD OWNER OF THE REAL ESTATE DESCRIBED HEREIN.

 

PREPARED BY, RECORDING REQUESTED BY,

AND WHEN RECORDED MAIL TO:

 

Buchanan Ingersoll PC

301 Grant Street, 20th Floor

One Oxford Centre

Pittsburgh, PA 15219-1410

Attention: Michael A. Donadee, Esq.

 

--------------------------------------------------------------------------------

OPEN-END MORTGAGE, SECURITY AGREEMENT, ASSIGNMENT OF RENTS

AND LEASES, FINANCING STATEMENT AND FIXTURE FILING (PENNSYLVANIA)

THIS MORTGAGE SECURES FUTURE ADVANCES

 

THIS OPEN-END MORTGAGE, SECURITY AGREEMENT, ASSIGNMENT OF RENTS AND LEASES,
FINANCING STATEMENT AND FIXTURE FILING (this “Mortgage”) is made and executed
the 14th day of June, 2004, to be delivered and effective June 30, 2004, and is
made and delivered by                                                          ,
a                                                  , whose address is c/o Consol
Energy, Inc., CONSOL Plaza, 1800 Washington Road, Pittsburgh, Pennsylvania 15241
(“Mortgagor”), to DAVID A. VANASKEY, as Collateral Trustee pursuant to that
certain Collateral Trust Agreement dated as of June 30, 2004, for the benefit of
(i) the Collateral Trustees (as defined in such Collateral Trust Agreement),
(ii) the Lenders under the Credit Agreement, (iii) the holders of the Senior
Notes (1991) and the Senior Notes (2002), and (iv) any other Persons from time
to time holders of the Secured Debt (in such capacity, together with any
successor or assign, “Collateral Trustee”), having an address c/o Wilmington
Trust Company, 1100 North Market Street, Rodney Square North, Wilmington, DE
19890, (Collateral Trustee, together with its successors and assigns,
“Mortgagee”).

 

This Mortgage is an Open-End Mortgage as defined in § 8143(f) of Title 42 of the
Pennsylvania Consolidated Statutes, and as such is entitled to the benefits of
the Open-End Mortgage Act (the “Act”) as codified at 42 Pa. C.S.A. § 8143 et
seq. The parties to this Mortgage intend that, in addition to the Secured Debt
(as hereinafter defined), this Mortgage shall secure unpaid balances of future
advances made or incurred after this Mortgage is left for record with the
Recorder’s Office of Fayette County, Pennsylvania. The maximum amount of the
principal of the Secured Debt (which shall consist of unpaid balances of loan
advances made either before or after, or both before and after, this Mortgage is
left for record) that may be outstanding at any time is One Billion Dollars
($1,000,000,000), plus accrued and unpaid interest thereon. In addition to the
obligations of Mortgagor with respect to such Secured Debt and interest, this
Mortgage secures unpaid balances of advances made with respect to the Mortgaged
Property (defined below) for the payment of taxes, assessments, maintenance
charges, insurance premiums and costs incurred for the protection and
preservation of the Mortgaged Property or the lien of this Mortgage, including
without limitation those permitted by 42 Pa. C.S.A. § 8144, and costs and
expenses, including attorneys’ fees, court costs and disbursements, incurred by
Mortgagee by reason of default by Mortgagor with respect to any portion of the
Secured Debt.

 

Notices pursuant to the Act shall be delivered to:

 

David A. Vanaskey, as Collateral Trustee

c/o Wilmington Trust Company

Rodney Square North

1100 North Market Street

Wilmington, DE 19890

Phone: (302) 636-6019

Telecopy: (302) 636-4143

 

ARTICLE 1

DEFINITIONS

 

Section 1.1 Use of Capitalized Terms. All capitalized terms used herein without
definition shall have the respective meanings ascribed to them in the Credit
Agreement.

 

Section 1.2 Definitions. The following terms used in this Mortgage shall have
the meanings set forth:

 

(a) “Actionable Default”: means (i) an “Event of Default” under and as defined
by the Credit Agreement; (ii) an event of default under the Public Indenture; or
(iii) an event of default under the Issuing and Paying Agency Agreement, or (iv)
a default under the terms of the Collateral Trust Agreement; or (v) Mortgagor
shall at any time deliver or cause to be delivered to Mortgagee or to Credit
Facility Agent a notice pursuant to 42 Pa. C.S.A. § 8143 electing to limit the
indebtedness secured by this Mortgage.

 

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(b) “Bank”: shall mean PNC Bank, National Association, in its individual
capacity.

 

(c) “Borrower”: shall mean Consol Energy Inc., a Delaware corporation.

 

(d) “Collateral Trust Agreement”: shall mean that certain Collateral Trust
Agreement, dated as of June 30, 2004, by and among Collateral Trustee herein, as
Individual Trustee thereunder, Wilmington Trust Company, a Delaware banking
corporation, not in its individual capacity but solely as corporate trustee, as
Corporate Trustee thereunder, the Borrower, and the Guarantors, including
without limitation, Mortgagor, as the same may hereafter be modified, amended,
restated, supplemented, refinanced or replaced from time to time.

 

(e) “Credit Agreement”: That certain Credit Agreement dated as of June 30, 2004
by and among Borrower, PNC Bank, National Association and Citicorp North
America, Inc., as Co-Administrative Agents, the Credit Facility Agent, LaSalle
Bank National Association, Société Générale, New York Branch and SunTrust Bank,
each in its capacity as a co-documentation agent, the Lenders described therein,
the Guarantors party thereto, and Citigroup Global Markets Inc. and PNC Capital
Markets, Inc., as Joint Lead Arrangers, as the same may be amended, amended and
restated, supplemented, modified or replaced from time to time, to the extent
the same shall be in effect.

 

(f) “Credit Facility Agent”: shall mean PNC Bank, National Association, as
Paying Agent under the Credit Agreement.

 

(g) “Guarantors”: shall mean all Subsidiaries of the Borrower other than
Excluded Subsidiaries.

 

(h) “Issuing and Paying Agency Agreement”: means the Issuing and Paying Agency
Agreement, dated as of December 31, 1991, among the Borrower, Consolidation Coal
Company, CONSOL Inc. and The Bank of Nova Scotia Trust Company of New York (as
successor paying agent to JP Morgan Chase Bank), delivered with respect to the
Senior Notes (1991), as further amended, modified, supplemented, extended,
restated, renewed or replaced from time to time.

 

(i) “Lenders”: shall mean those financial institutions from time to time
identified as Lenders pursuant to the Credit Agreement, and their respective
successors and assigns.

 

(j) “Loan Parties” shall mean Borrower, Mortgagor and the other Guarantors.

 

(k) “Mortgaged Property”: All of Mortgagor’s right, title and interest in and
to, (1) the fee interests in the real property identified at Exhibit A and
Exhibit B attached hereto and incorporated herein, by this reference, or, to the
extent applicable, the fee interest in the surface of such real property, in
each case together with any greater estate therein as hereafter may be acquired
by Mortgagor (the “Owned Land”), (2) the leasehold interest in the real property
demised pursuant to the agreements identified at Exhibit A and Exhibit B hereto
and incorporated herein by this reference (as such agreements may be amended,
amended and restated, supplemented or otherwise modified from time to time, each
such agreement, a “Mortgaged Lease” and collectively the “Mortgaged Leases”),
together with any greater estate therein as hereafter may be acquired by
Mortgagor (the “Leased Land”) (3) the other real property interests identified
at Exhibit C hereto (the “Other Property”), provided that title to the Other
Property is not warranted herein, and provided further, the Other Property
excludes any enclosed Improvements of any kind located thereon (the Owned Land,
the Leased Land and the Other Property are sometimes referred to herein
collectively as the “Land”), (4) the active mine property which constitutes
Owned Land and Leased Land identified at Exhibit D hereto, the Mineral Interests
in which are being actively operated, but with respect to which, title is not
warranted herein; (5) all minerals owned by Mortgagor or leased to Mortgagor
(whether pursuant to the Mortgaged Leases or otherwise) and located upon, under
and in the Land (including, without limitation, coal, oil, gas and other solid,
liquid and gaseous hydrocarbons as well as limestone included within the Land in
place and as produced and extracted), and all rights, privileges, titles and
interests appurtenant and relating thereto and in connection therewith
(including, without limitation, rights, privileges, titles and interests for the
development, production, extraction, processing, treatment, storage,
transportation and sale and other disposition of minerals and all contracts and
other agreements relating to such activities as well as all accounts, accounts

 

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receivable, contract rights, other rights to the payments of monies, chattel
paper and general intangibles arising from or relating to such activities)
(collectively, the “Mineral Interests”), (6) all improvements now owned or
hereafter acquired by Mortgagor, now or at any time situated, placed or
constructed upon the Land (the “Improvements”; the Land and Improvements are
collectively referred to as the “Premises”), (7) all materials, supplies,
equipment, apparatus and other items of personal property now owned or hereafter
acquired by Mortgagor and now or hereafter attached to or installed in any of
the Improvements or the Land, and water, gas, electrical, telephone, storm and
sanitary sewer facilities and all other utilities whether or not situated in
easements (the “Fixtures”), (8) all goods, accounts, general intangibles,
instruments, documents, chattel paper and all other personal property of any
kind or character, including such items of personal property as defined in the
UCC (defined below), now owned or hereafter acquired by Mortgagor and now or
hereafter affixed to, placed upon, used in connection with, raising from or
otherwise related to the Premises (the “Personalty”), (9) all reserves, escrows
or impounds required under the Security Documents and all deposit accounts
maintained by Mortgagor with respect to the Mortgaged Property (the “Deposit
Accounts”), (10) all leases, licenses, concessions, occupancy agreements or
other agreements (written or oral, now or at any time in effect) which grant to
any Person, other than Mortgagor, a possessory interest in, or the right to use,
all or any part of the Mortgaged Property, together with all related security
and other deposits (the “Leases”), (11) all of the rents, revenues, royalties,
income, proceeds, profits, security and other types of deposits, and other
benefits paid or payable by parties to the Leases for using, leasing, licensing
possessing, operating from, residing in, selling or otherwise enjoying the
Mortgaged Property, (the “Rents”), (12) all other agreements, such as
construction contracts, architects’ agreements, engineers’ contracts, utility
contracts, maintenance agreements, management agreements, service contracts,
listing agreements, guaranties, warranties, all permits (subject to any required
regulatory approval), licenses, certificates and entitlements in any way
relating to the construction, use, occupancy, operation, maintenance, enjoyment
or ownership of the Mortgaged Property (the “Permits”), (13) all rights,
privileges, tenements, hereditaments, rights-of-way, easements, appendages and
appurtenances appertaining to the foregoing, (14) all property tax refunds
payable with respect to the Mortgaged Property (the “Tax Refunds”), (15) all
accessions, replacements and substitutions for any of the foregoing and all
proceeds thereof (the “Proceeds”), (16) all insurance policies, unearned
premiums therefor and proceeds from such policies covering any of the above
property now or hereafter acquired by Mortgagor (the “Insurance”), and (17) all
awards, damages, remunerations, reimbursements, settlements or compensation
heretofore made or hereafter to be made by any governmental authority pertaining
to any condemnation or other taking (or any purchase in lieu thereof) of all or
any portion of the foregoing property rights and interests (the “Condemnation
Awards”). As used in this Mortgage, the term “Mortgaged Property” shall mean all
or, where the context permits or requires, any portion of the above or any
interest therein. Notwithstanding the foregoing or anything to the contrary
contained in this Mortgage, the terms “Mortgaged Property”, “Land”, “Mineral
Interests”, “Improvements”, “Premises”, “Fixtures”, “Leases”, “Rents”,
“Personalty”, “Permits”, “Proceeds”, “Insurance” and “Condemnation Awards” shall
apply only to the extent of Mortgagor’s interests therein.

 

(l) “Permitted Liens”: Collectively, liens permitted under the Credit Agreement,
including any lessor liens retained or otherwise existing pursuant to any of the
Leases, together with all other matters of title disclosed to Credit Facility
Agent in letters of counsel delivered in connection with the negotiation,
execution and delivery of this Mortgage.

 

(m) “Person”: shall mean any individual, corporation, partnership, limited
liability company, association, joint-stock company, trust, unincorporated
organization, joint venture, government or political subdivision or agency
thereof, or any other entity.

 

(n) “Public Indenture”: means the Indenture, dated March 7, 2002, as amended by
the First Supplemental Indenture, dated March 7, 2002, as amended by the Second
Supplemental Indenture, dated September 30, 2003, and as further amended,
modified, supplemented, extended, restated, renewed or replaced from time to
time, by and among the Borrower, certain subsidiaries of the Borrower, and the
Public Trustee, as trustee, providing for the issuance of $250 million 7.875%
senior unsecured notes due March 1, 2012.

 

(o) “Secured Debt”: (1) All fees, expenses and charges, including, without
limitation, indemnification, reimbursement or contribution obligations of the
Loan Parties to the Collateral Trustees under (and as defined in) the Collateral
Trust Agreement; (2) all indebtedness and all other Obligations of Mortgagor or
any of the other Loan Parties to Credit Facility Agent or any of the other
Lenders under the Credit Agreement or any of the other Security Documents,
including, without limitation, (A) Revolving Credit Loans, evidenced by certain

 

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Revolving Credit Notes, pursuant to the Credit Agreement, in an aggregate amount
not to exceed the sum of Four Hundred Million Dollars ($400,000,000), which
Revolving Credit Loans include, without limitation, Swing Loans made by Bank to
Borrower, evidenced by a certain Swing Loan Note, delivered by Borrower to Bank,
made pursuant to the Credit Agreement, in an amount not to exceed the sum of
Twenty Five Million Dollars ($25,000,000), (B) all of the reimbursement
obligations of Borrower and any Loan Party with respect to the Tranche B Letters
of Credit issued pursuant to the Credit Agreement, in an aggregate undrawn face
amount not to exceed the sum of Two Hundred Million Dollars ($200,000,000),
further including, without limitation, (C) obligations and liabilities of any
nature now or hereafter existing under or arising in connection with any
Revolving Letters of Credit, including, without limitation, the reimbursement
obligations in respect thereof, together with interest and other amounts payable
with respect thereto, and (F) all Obligations and other liabilities of any
nature now or hereafter existing under any Specified Swap Agreement; (3) all
indebtedness of Mortgagor or any of the other Loan Parties existing pursuant to
the Senior Notes (1991) in an aggregate amount of Forty-Five Million Dollars
($45,000,000); and (3) all indebtedness of Mortgagor or any of the other Loan
Parties existing pursuant to the Senior Notes (2002), in an aggregate amount of
Two Hundred Fifty Million Dollars ($250,000,000).

 

(p) “Security Documents”: shall mean the Credit Agreement, the Credit Facility
Agent’s Letter, the Guaranty Agreement, the Indemnity, the Intercompany
Subordination Agreement, the Mortgages and Deeds of Trust, the Notes, the
Patent, Trademark and Copyright Assignment, the Pledge Agreement, the Security
Agreement, any Specified Swap Agreements and any other instruments, certificates
or documents delivered or contemplated to be delivered hereunder or thereunder
or in connection herewith or therewith, as the same may be supplemented,
amended, extended, renewed or replaced from time to time in accordance herewith
or therewith, and Security Document shall mean any of the Security Documents.

 

(q) “Senior Notes (1991)”: shall mean the outstanding aggregate $45 million
principal amount of 8.25% notes due 2007, of the Borrower, issued pursuant to
the Issuing and Paying Agency Agreement.

 

(r) “Senior Notes (2002)”: shall mean an aggregate $250,000,000 principal amount
of 7.875% notes due 2012, issued pursuant to the Public Indenture.

 

(s) “UCC”: The Uniform Commercial Code of Pennsylvania or, if the creation,
perfection and enforcement of any security interest herein granted is governed
by the laws of a state other than the Commonwealth of Pennsylvania, then, as to
the matter in question, the Uniform Commercial Code in effect in that state.

 

ARTICLE 2

GRANT

 

Section 2.1 Grant. To secure the full and timely payment and performance of the
Secured Debt, Mortgagor MORTGAGES, GRANTS, BARGAINS, ASSIGNS, SELLS, CONVEYS and
CONFIRMS, to Mortgagee, as Collateral Trustee for the Lenders and for other
Persons from time to time holders of the Secured Debt, the Mortgaged Property,
subject, however, only to Permitted Liens, TO HAVE AND TO HOLD the Mortgaged
Property to Mortgagee. Mortgagor does hereby bind itself, its successors and
assigns to WARRANT AND FOREVER DEFEND the title to the Mortgaged Property
identified at Exhibit A and Exhibit B unto Mortgagee; provided however, no
warranty of title is made as to the Mortgaged Property identified at Exhibit C
or Exhibit D.

 

Provided further, subject to the terms hereof and of the Credit Agreement and
the other Security Documents, until an Event of Default shall occur, Mortgagor
shall have and possess the full right and privilege to own, lease, operate,
manage and control the Mortgaged Property in all respects, to extract the
Mineral Interests therefrom, and to do all other matters and things that
Mortgagor deems necessary, desirable or appropriate thereon and therewith.

 

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ARTICLE 3

WARRANTIES, REPRESENTATIONS AND COVENANTS

 

Mortgagor warrants, represents and covenants to Mortgagee as follows:

 

Section 3.1 Title to Mortgaged Property and Lien of this Instrument. With
respect to the property identified at Exhibit A and Exhibit B hereto, Mortgagor
owns, or has valid leasehold rights to, the Mortgaged Property free and clear of
any liens, claims or interests, except for Permitted Liens, or matters disclosed
in title opinions delivered to Mortgagee by counsel to Mortgagor
contemporaneously herewith, and this Mortgage creates valid, enforceable first
priority liens and security interests against the Mortgaged Property identified
at Exhibit A and Exhibit B. With respect to the Mortgaged Property identified at
Exhibit C and Exhibit D hereto, Mortgagor does not warrant title, but to
Mortgagor’s knowledge Mortgagor owns, or has valid leasehold rights to, as
applicable, the Mortgaged Property free and clear of any liens, claims or
interests, except the Permitted Liens, and this Mortgage creates valid,
enforceable liens and security interests against the Mortgaged Property only to
the extent of Mortgagor’s interests therein. Adverse matters of title that are
known to Mortgagor and which are material to the continuing business operations
of Mortgagor are disclosed on the Exhibits, where applicable. If adverse matters
of title which are material to the continuing business operations of Mortgagor
arise at any future time during which this Mortgage remains in force, Mortgagor
will promptly advise Credit Facility Agent in writing as to such matters.

 

Section 3.2 First Lien Status. Except for Permitted Liens, Mortgagor shall
preserve and protect the first lien and security interest status of this
Mortgage. If any lien or security interest other than a Permitted Lien is
asserted against the Mortgaged Property, Mortgagor shall promptly, and at its
expense, (a) give Mortgagee a detailed written notice of such lien or security
interest (including origin, amount and other terms), and (b) pay the underlying
claim in full or take such other action so as to cause it to be released or
contest the same in compliance with the requirements of the Credit Agreement and
the Collateral Trust Agreement (including the requirement of providing a bond or
other security satisfactory to Mortgagee).

 

Section 3.3 Payment and Performance. Mortgagor shall pay and perform the Secured
Debt in a timely manner, when required, and in material compliance with all
terms, covenants and conditions applicable thereto.

 

Section 3.4 Replacement of Fixtures. Subject to the terms of the Collateral
Trust Agreement and the Credit Agreement, Mortgagor shall not, without the prior
written consent of Mortgagee, permit any of the Fixtures owned or leased by
Mortgagor to be removed at any time from the Land or Improvements, unless the
removed item is removed temporarily for maintenance and repair or is permitted
to be so removed, or is not material to Mortgagor’s continuing business
operations.

 

Section 3.5 Inspection. Mortgagor shall permit Mortgagee and Credit Facility
Agent, and their respective agents, representatives and employees, upon
reasonable prior notice to Mortgagor, to inspect the Mortgaged Property and all
books and records of Mortgagor located thereon, as provided in the Credit
Agreement, provided that such right shall, with respect to Leased Land, be
subject to the provisions of any applicable Mortgaged Lease.

 

Section 3.6 Insurance; Condemnation Awards and Insurance Proceeds.

 

(a) Insurance. Mortgagor shall maintain or cause to be maintained, with respect
to the Mortgaged Property, insurance against loss or damage, as required
pursuant to the terms of the Credit Agreement. If any portion of an enclosed
structure now or hereafter located on the Mortgaged Property is located in an
area identified by the Federal Emergency Management Agency as an area having
special flood hazards and in which flood insurance has been made available under
the National Flood Insurance Act of 1968 (or any amendment or successor act
thereto), then Mortgagor shall maintain, or cause to be maintained, with a
financially sound and reputable insurer, flood insurance in an amount sufficient
to comply with all applicable rules and regulations promulgated pursuant to such
Act.

 

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(b) Condemnation Awards. Subject to the provisions of any applicable Mortgaged
Lease, and also subject to the terms of the Credit Agreement applicable to
proceeds payable as the result of a Casualty Event, Mortgagor assigns all
Condemnation Awards to Mortgagee and authorizes Mortgagee to collect and receive
such Condemnation Awards and to give proper receipts and acquittances therefor,
subject to the terms of the Collateral Trust Agreement.

 

(c) Insurance Proceeds. Subject to the provisions of any applicable Mortgaged
Lease, and further subject to the terms of the Credit Agreement applicable to
proceeds payable as the result of a Casualty Event, Mortgagor assigns to
Mortgagee all proceeds of any insurance policies insuring against loss or damage
to the Mortgaged Property. Subject to the terms of the Credit Agreement, and any
applicable Mortgaged Lease, Mortgagor authorizes Mortgagee to collect and
receive such proceeds and authorizes and directs the issuer of each of such
insurance policies to make payment for all such losses directly to Mortgagee,
instead of to Mortgagor and Mortgagee jointly.

 

Section 3.7 Five Year Mine Plan. The real property identified at Exhibits A and
B hereto constitutes property that is part of an active five year mine plan
relating to coal recovery operations being conducted by Mortgagor or its
Affiliates within that portion of the Mortgaged Property, such descriptions
accurately and completely identify, in all material respects, the real property
interests which constitutes the active five year mine plan of Mortgagor or its
Affiliates within the Mortgaged Property.

 

Section 3.8 Other Property. The Other Property described on Exhibit C represents
reserves of Mineral Interests that are owned or leased by Mortgagor and held for
future development. Mortgagor represents that the Mineral Interest within the
Other Property described on Exhibit C are not being developed by Mortgagor for
the purpose of recovering coal, gas or other minerals, and any buildings,
structures or other improvements, if any, that may be located on such portions
of the Other Property, are of no or nominal value. Such buildings, structures
and improvements located on the Other Property described on Exhibit C do not
therefore constitute a part of the Mortgaged Property pursuant to this Mortgage.

 

ARTICLE 4

LEASEHOLD MORTGAGE PROVISIONS

 

Section 4.1 Representations; Warranties; Covenants. Mortgagor hereby represents,
warrants and covenants that, with respect to Mortgaged Leases that are material
to Mortgagor’s continuing business operations:

 

(a) Representations of Mortgagor. To the knowledge of Mortgagor, (1) such
Mortgaged Leases are unmodified and in full force and effect, (2) all rent and
other charges therein have been paid to the extent they are payable to the date
hereof, (3) Mortgagor enjoys the quiet and peaceful possession of such Premises,
(4) Mortgagor is not in default under any of the terms thereof and there are no
circumstances which, with the passage of time or the giving of notice or both,
would constitute an event of default thereunder, (5) the lessor thereunder is
not in default under any of the terms or provisions thereof on the part of the
lessor to be observed or performed;

 

(b) Payment of Rents. Mortgagor shall promptly pay, when due and payable, the
rent and other charges payable pursuant to such Mortgaged Lease, and will timely
perform and observe, in all material respects, all of the other terms, covenants
and conditions required to be performed and observed by Mortgagor as lessee
under such Mortgaged Lease;

 

(c) Notice of Default. Mortgagor shall notify Mortgagee in writing of any
material default by Mortgagor in the performance or observance of any terms,
covenants or conditions on the part of Mortgagor to be performed or observed
under such Mortgaged Lease within three (3) days after Mortgagor obtains
knowledge of such default; Mortgagor shall, immediately upon receipt thereof,
deliver a copy of each written notice given to Mortgagor by the lessor pursuant
to any Mortgaged Lease and promptly notify Mortgagee in writing of any material
default by the lessor in the performance or observance of any of the terms,
covenants or conditions on the part of the lessor to be performed or observed
thereunder;

 

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(d) No Termination. Unless required under the terms of any Mortgaged Lease,
Mortgagor shall not, without the prior written consent of Mortgagee (which
consent will not be unreasonably withheld, conditioned or delayed) terminate,
modify or surrender any such Mortgaged Lease, and any such attempted
termination, modification or surrender without such consent shall be void; and

 

(e) Estoppel. Mortgagor shall, within thirty (30) days after written request
from Mortgagee, use its reasonable efforts to obtain from the lessor and deliver
to Mortgagee a certificate setting forth the name of the tenant under any
Mortgaged Lease and stating that such Mortgaged Lease is in full force and
effect, is unmodified or, if such Mortgaged Lease has been modified, the date of
each modification (together with copies of each such modification), that no
notice of termination thereof has been served on Mortgagor, stating that no
default or event which with notice or lapse of time (or both) would become a
default is existing under, such Mortgaged Lease (or if any such default or event
is existing, specifying the nature of such default or event), stating the date
to which rent has been paid, and containing such other statements and
representations as may be requested by Mortgagee.

 

Section 4.2 No Merger. So long as any of the Secured Debt remains unpaid or
unperformed, the fee title to and the leasehold estate in the Premises subject
to any Mortgaged Lease shall not merge but shall always be kept separate and
distinct notwithstanding the union of such estates in the lessor or Mortgagor,
or in a third party, by purchase or otherwise. If Mortgagor acquires the fee
title or any other estate, title or interest in the Premises, or any part
thereof, the lien of this Mortgage shall attach to, cover and be a lien upon
such acquired estate, title or interest and the same shall thereupon be and
become a part of the Mortgaged Property with the same force and effect as if
specifically encumbered herein. Mortgagor agrees to execute all instruments and
documents that Mortgagee may reasonably require to ratify, confirm and further
evidence the lien of this Mortgage on the acquired estate, title or interest.
Furthermore, Mortgagor hereby appoints Mortgagee as its true and lawful
attorney-in-fact to execute and deliver, following an Actionable Default, all
such instruments and documents in the name and on behalf of Mortgagor. This
power, being coupled with an interest, shall be irrevocable as long as any
portion of the Secured Debt remains unpaid.

 

Section 4.3 Mortgagee as Lessee. If any Mortgaged Lease, that is material to the
continuing business operations of Mortgagor, shall be terminated prior to the
natural expiration of its term due to default by Mortgagor or any tenant
thereunder, and if, pursuant to the provisions of such Mortgaged Lease,
Mortgagee or its designee shall acquire from the lessor a new lease of the
Premises, Mortgagor shall have no right, title or interest in or to such new
lease or the leasehold estate created thereby, or renewal privileges therein
contained.

 

Section 4.4 No Assignment. Notwithstanding anything to the contrary contained
herein, this Mortgage shall not constitute an assignment of any Mortgaged Lease
within the meaning of any provision thereof prohibiting its assignment and
Mortgagee shall have no liability or obligation thereunder by reason of its
acceptance of this Mortgage. Mortgagee shall be liable for the obligations of
the tenant arising out of any Mortgaged Lease for only that period of time for
which Mortgagee is in possession of the Premises or has acquired, by foreclosure
or otherwise, and is holding all of Mortgagor’s right, title and interest
therein.

 

Section 4.5 Required Landlord Consents. Notwithstanding anything to the contrary
contained in this Mortgage, to the extent that the assignment, transfer or
conveyance of, or granting of a Lien or security interest in, any part of the
Mortgaged Property by Mortgagor to Mortgagee under this Mortgage is prohibited
by the terms of the instrument, contract or agreement evidencing or creating the
Mortgaged Property, or would result in a breach or default by Mortgagor
thereunder, or the termination thereunder, in each case due to the granting of a
lien or security interest therein, the Mortgaged Property shall not include, and
shall exclude, such instrument, contract or agreement, including, but not
limited to, the granting of a mortgage or deed of trust lien against a leasehold
interest held by Mortgagor when the lease, by its terms, requires the consent of
the lessor to an effective assignment of the lessee’s leasehold estate.

 

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ARTICLE 5

DEFAULT AND FORECLOSURE

 

Section 5.1 Remedies. Upon the occurrence and during the continuance of an
Actionable Default, subject to the terms of the Collateral Trust Agreement, any
or all of the following rights, remedies and recourses may be exercised:

 

(a) Acceleration. Any holder of any portion of the Secured Debt may declare that
portion of the Secured Debt, or any portion thereof, to be immediately due and
payable, without further notice, presentment, protest, notice of intent to
accelerate, notice of acceleration, demand or action of any nature whatsoever
(each of which hereby is expressly waived by Mortgagor), whereupon the same
shall become immediately due and payable.

 

(b) Entry on Mortgaged Property. Subject to the provisions of any applicable
Mortgaged Lease and applicable law, Mortgagee may enter the Mortgaged Property
and take exclusive possession thereof and of all books, records and accounts
relating thereto or located thereon. If Mortgagor remains in possession of the
Mortgaged Property following the occurrence and during the continuance of an
Actionable Default and without Mortgagee’s prior written consent, subject to the
provisions of any applicable Mortgaged Lease and applicable law, Mortgagee may
invoke any legal remedies to dispossess Mortgagor.

 

(c) Operation of Mortgaged Property. Subject to the provisions of any applicable
Mortgaged Lease, Mortgagee may hold, lease, develop, manage, operate or
otherwise use the Mortgaged Property upon such terms and conditions as Mortgagee
may deem reasonable under the circumstances (including, without limitation,
making such repairs, alterations, additions and improvements and taking other
actions, from time to time, as Mortgagee deems necessary or desirable, also
including the mining and sale of coal produced from the Mortgaged Property), and
apply all Rents and other amounts collected by Mortgagee in connection therewith
in accordance with the provisions of Section 5.7.

 

(d) Foreclosure and Sale. Mortgagee may institute proceedings for the complete
foreclosure of this Mortgage by judicial action, in which case the Mortgaged
Property may be sold for cash or credit in one or more parcels, subject to the
provisions of any applicable Mortgaged Lease. With respect to any notices
required or permitted under the UCC, Mortgagor agrees that ten (10) days’ prior
written notice shall be deemed commercially reasonable. At any such sale by
virtue of any judicial proceedings, or any other legal right, remedy or
recourse, the title to and right of possession of any such property shall pass
to the purchaser thereof, and to the fullest extent permitted by law, Mortgagor
shall be completely and irrevocably divested of all of its right, title,
interest, claim, equity, equity of redemption, and demand whatsoever, either at
law or in equity, in and to the property sold and such sale shall be a perpetual
bar both at law and in equity against Mortgagor, and against all other Persons
claiming or to claim the property sold or any part thereof, by, through or under
Mortgagor. Mortgagee may be a purchaser at such sale. If Mortgagee is the
highest bidder, Mortgagee may credit the portion of the purchase price that
would be distributed to the Secured Debt pursuant to the Collateral Trust
Agreement. In the event this Mortgage is foreclosed by judicial action,
appraisement of the Mortgaged Property is waived.

 

(e) Receiver. Mortgagee may make application to a court of competent
jurisdiction for, and obtain from such court as a matter of strict right and
without notice to Mortgagor or regard to the adequacy of the Mortgaged Property
for the repayment of the Secured Debt, the appointment of a receiver of the
Mortgaged Property, and Mortgagor irrevocably consents to such appointment. Any
such receiver shall have all the usual powers and duties of receivers in similar
eases, including the full power to rent, maintain and otherwise operate the
Mortgaged Property upon such terms as may be approved by the court, and in a
manner consistent with the terms of any applicable Mortgaged Lease, and shall
apply such Rents in accordance with the provisions of Section 5.7.

 

(f) Other Remedies. Subject to the provisions of any applicable Mortgaged Lease,
Mortgagee may exercise all other rights, remedies and recourses granted to
Mortgagee with respect to all or any portion of the Secured Debt pursuant to the
terms of the Collateral Trust Agreement or the other Security Documents, or
otherwise available at law or in equity.

 

Section 5.2 Separate Sales. To the extent not prohibited under the terms of any
applicable Mortgaged Lease, the Mortgaged Property may be sold in one or more
parcels and in such manner and order as

 

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Mortgagee in its sole discretion may elect. The right of sale arising out of any
Actionable Default shall not be exhausted by any one or more sales.

 

Section 5.3 Remedies Cumulative, Concurrent and Nonexclusive. Mortgagee shall
have all rights, remedies and recourses with respect to the enforcement of all
or any portion of the Secured Debt granted pursuant to the Collateral Trust
Agreement and the other Security Documents, and available at law or equity
(including the UCC), which rights, (a) shall be cumulative and concurrent, (b)
may be pursued separately, successively or concurrently against Mortgagor or
others obligated for the payment or performance of the Secured Debt or against
the Mortgaged Property, or against any one or more of them, at the sole
discretion of Mortgagee, as the case may be, (c) may be exercised as often as
occasion therefore shall arise, and the exercise or failure to exercise any of
them shall not be construed as a waiver or release thereof or of any other
right, remedy or recourse, and (d) are intended to be, and shall be,
nonexclusive. No action by Mortgagee in the enforcement of any rights, remedies
or recourses relating to any portion of the Secured Debt, or otherwise at law or
equity shall be deemed to cure any Actionable Default.

 

Section 5.4 Release of and Resort to Collateral. Subject to the terms of the
Collateral Trust Agreement, Mortgagee may release, regardless of consideration
and without the necessity for any notice to or consent by the holder of any
subordinate lien on the Mortgaged Property, any part of the Mortgaged Property
without, as to the remainder, in any way impairing, affecting, subordinating or
releasing the lien or security interest created in or evidenced by this Mortgage
or its status as a first and prior lien and security interest in and to the
Mortgaged Property. For payment of the Secured Debt, Mortgagee may resort to any
other security in such order and manner as Mortgagee may elect.

 

Section 5.5 Waiver of Redemption, Notice and Marshalling of Assets. To the
fullest extent permitted by law, Mortgagor hereby irrevocably and
unconditionally waives and releases (a) all benefit that might accrue to
Mortgagor by virtue of any present or future statute of limitations or law or
judicial decision exempting the Mortgaged Property from attachment, levy or sale
on execution or providing for any stay of execution, exemption from civil
process, redemption or extension of time for payment, (b) all notices of any
Actionable Default or of Mortgagee’s election to exercise or the actual exercise
of any right, remedy or recourse provided for under the Collateral Trust
Agreement, the Credit Agreement or other Security Documents, or this Mortgage,
and (c) any right to a marshalling of assets or a sale in inverse order of
alienation.

 

Section 5.6 Discontinuance of Proceedings. If Mortgagee shall have proceeded to
invoke any right, remedy or recourse permitted under the Collateral Trust
Agreement or this Mortgage and shall thereafter elect to discontinue or abandon
it for any reason, Mortgagee shall have the unqualified right to do so and, in
such an event, Mortgagor and Mortgagee shall be restored to their former
positions with respect to the Secured Debt, the Security Documents, the
Mortgaged Property and otherwise, and the rights, remedies, recourses and powers
of Mortgagee shall continue as if the right, remedy or recourse had never been
invoked, but no such discontinuance or abandonment shall waive any Actionable
Default which may then exist or the right of Mortgagee thereafter to exercise
any right, remedy or recourse under the Collateral Trust Agreement, the Credit
Agreement, or this Mortgage for such Actionable Default.

 

Section 5.7 Application of Proceeds. The proceeds of any sale of the
“as-extracted” collateral, and the Rents, and other amounts generated by the
holding, leasing, management, operation or other use of the Mortgaged Property,
shall be applied by Mortgagee (or the receiver, if one is appointed) in the
following order unless otherwise required by applicable law:

 

(a) to the payment of the costs and expenses of taking possession of the
Mortgaged Property and of holding, using, leasing, repairing, improving and
selling the same, including, without limitation (1) receiver’s fees and
expenses, including the repayment of the amounts evidenced by any receiver’s
certificates, (2) court costs, (3) attorneys’ and accountants’ fees and
expenses, (4) costs of advertisement and (5) the payment of all rent and other
charges under any applicable Mortgaged Lease;

 

(b) to the payment and performance of the Secured Debt, in such manner and order
of preference as set forth in the Collateral Trust Agreement; and

 

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(c) the balance, if any, to the Persons legally entitled thereto.

 

Section 5.8 Occupancy After Foreclosure. Any sale of the Mortgaged Property or
any part thereof in accordance with Section 5.1(d) will divest all right, title
and interest of Mortgagor in and to the property sold. Subject to applicable law
and any applicable Mortgaged Lease, any purchaser at a foreclosure sale will
receive immediate possession of the property purchased. If Mortgagor retains
possession of such property or any part thereof subsequent to such sale,
Mortgagor will be considered a tenant at sufferance of the purchaser, and will,
if Mortgagor remains in possession after demand to remove, be subject to
eviction and removal, forcible or otherwise, with or without process of law.

 

Section 5.9 Additional Advances and Disbursements; Costs of Enforcement.

 

(a) Upon the occurrence and during the continuance of any Actionable Default,
Mortgagee shall have the right, but not the obligation, to cure such Actionable
Default in the name and on behalf of Mortgagor. All sums advanced and expenses
incurred at any time by Mortgagee under this Section 5.9, or otherwise under the
Collateral Trust Agreement, this Mortgage, any of the Security Documents, or
applicable law, shall bear interest from the date that such sum is advanced or
expense incurred, to and including the date of reimbursement, computed at the
highest rate at which interest is then computed on any portion of the Secured
Debt, and all such sums, together with interest thereon, shall be secured by
this Mortgage.

 

(b) Mortgagor shall pay all expenses (including reasonable attorneys’ fees and
expenses) of or incidental to the perfection and enforcement of this Mortgage
and the Collateral Trust Agreement, or the enforcement, compromise or settlement
of the Secured Debt or any claim under this Mortgage or the Collateral Trust
Agreement and for the curing thereof, or for defending or asserting the rights
and claims of Mortgagee in respect thereof, by litigation or otherwise.

 

Section 5.10 No Mortgagee in Possession. Neither the enforcement of any of the
remedies under this Article 5, the assignment of the Rents and Leases under
Article 6, the security interests under Article 7, nor any other remedies
afforded to Mortgagee hereunder or under the Collateral Trust Agreement, or at
law or in equity shall cause Mortgagee to be deemed or construed to be a
mortgagee in possession of the Mortgaged Property, to obligate Mortgagee to
lease the Mortgaged Property or attempt to do so, or to take any action, incur
any expense, or perform or discharge any obligation, duty or liability
whatsoever under any of the Leases or otherwise.

 

ARTICLE 6

ASSIGNMENT OF RENTS AND LEASES

 

Section 6.1 Assignment. In furtherance of and in addition to the assignment made
by Mortgagor in Section 2.1 of this Mortgage, Mortgagor hereby absolutely and
unconditionally assigns, sells, transfers and conveys to Mortgagee all of its
right, title and interest in and to all Leases, whether now existing or
hereafter entered into, and all of its right, title and interest in and to all
Rents. This assignment is an absolute assignment and not an assignment for
additional security only. So long as no Actionable Default shall have occurred
and be continuing, Mortgagor shall have a revocable license from Mortgagee to
exercise all rights extended to the landlord under the Leases, including the
right to receive and collect all Rents and to hold the Rents in trust for use in
the payment and performance of the Secured Debt, and to otherwise use the same.
The foregoing license is granted subject to the conditional limitation that no
Actionable Default shall have occurred and be continuing. Upon the occurrence
and during the continuance of an Actionable Default, whether or not legal
proceedings have commenced, and without regard to waste, adequacy of security
for the Secured Debt or solvency of Mortgagor, the license herein granted shall
automatically expire and terminate, without notice to Mortgagor by Mortgagee
(any such notice being hereby expressly waived by Mortgagor to the extent
permitted by applicable law).

 

Section 6.2 Perfection Upon Recordation. Mortgagor acknowledges that Mortgagee
has taken all actions necessary to obtain, and that upon recordation of this
Mortgage, Mortgagee shall have, to the extent permitted under applicable law, a
valid and fully perfected, first priority, present assignment of the Rents
arising out of the Leases and all security for such Leases. Mortgagor
acknowledges and agrees that upon recordation of this

 

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Mortgage, Mortgagee’s interest in the Rents shall be deemed to be fully
perfected, “choate” and enforced as to Mortgagor and to the extent permitted
under applicable law, all third parties, including, without limitation, any
subsequently appointed trustee in any case under Title 11 of the United States
Code (the “Bankruptcy Code”), without the necessity of commencing a foreclosure
action with respect to this Mortgage, making formal demand for the Rents,
obtaining the appointment of a receiver or taking any other affirmative action.

 

Section 6.3 Bankruptcy Provisions. Without limitation of the absolute nature of
the assignment of the Rents hereunder, Mortgagor and Mortgagee agree that (a)
this Mortgage shall constitute a “security agreement” for purposes of Section
552(b) of the Bankruptcy Code, (b) the security interest created by this
Mortgage extends to property of Mortgagor acquired before the commencement of a
case in bankruptcy and to all amounts paid as Rents and (c) such security
interest shall extend to all Rents acquired by the estate after the commencement
of any case in bankruptcy.

 

Section 6.4 No Merger of Estates. So long as any part of the Secured Debt remain
unpaid and undischarged, the fee and leasehold estates to the Mortgaged Property
shall not merge, but shall remain separate and distinct, notwithstanding the
union of such estates either in Mortgagor, Mortgagee, any tenant or any third
party by purchase or otherwise.

 

ARTICLE 7

SECURITY AGREEMENT AND FIXTURE FILING

 

Section 7.1 Security Interest. This Mortgage constitutes a “security agreement”
on personal property within the meaning of the UCC and other applicable law and
with respect to the Fixtures, Mineral Interests, Leases, Rents, Permits,
Personalty, Tax Refunds, Proceeds, Insurance and Condemnation Awards. To this
end, Mortgagor grants to Mortgagee a first and prior security interest in the
Fixtures, Leases, Rents, Permits, Personalty, Proceeds, Tax Refunds, Insurance,
Condemnation Awards and all other Mortgaged Property, including “as-extracted
collateral” (as such terms are used in the UCC), also including coal, oil and
gas, and other minerals, to secure the payment and performance of the Secured
Debt, and agrees that Mortgagee shall have all the rights and remedies of a
secured party under the UCC with respect to such property. Any notice of sale,
disposition or other intended action by Mortgagee with respect to the Fixtures,
Mineral Interests, Leases, Rents, Personalty, Permits, Tax Refunds, Proceeds,
Insurance and Condemnation Awards or other Mortgaged Property, including without
limitation, “as-extracted collateral” (as such terms are used in the UCC),
including coal and other minerals, sent to Mortgagor at least ten (10) days
prior to any action under the UCC shall constitute reasonable notice to
Mortgagor.

 

Section 7.2 Financing Statements. Mortgagor shall prepare and deliver to
Mortgagee such financing statements, and shall execute and deliver to Mortgagee
such other documents, instruments and further assurances, in each case in form
and substance satisfactory to Mortgagee, as Mortgagee may, from time to time,
reasonably consider necessary to create, perfect and preserve Mortgagee’s
security interest hereunder. Mortgagor hereby irrevocably authorizes Mortgagee
to cause financing statements (and amendments thereto and continuations thereof)
and any such documents, instruments and assurances to be recorded and filed, at
such times and places as may be required or permitted by law to so create,
perfect and preserve such security interest. Mortgagor represents and warrants
to Mortgagee that its jurisdiction of organization, as set forth in Schedule 1
hereof, is correct. After the date of this Mortgage, Mortgagor shall not change
its name, type of organization, organizational identification number (if any),
jurisdiction of organization or location (within the meaning of the UCC) without
giving at least thirty (30) days’ prior written notice to Mortgagee.

 

Section 7.3 Fixture and “as-extracted” Collateral Filing. This Mortgage shall
also constitute a “fixture filing” and an “as-extracted” collateral filing for
the purposes of the UCC against all of the Mortgaged Property which is or is to
become fixtures or “as-extracted” collateral related to the Premises. The
information provided in this Section 7.1 is provided so that this Mortgage shall
comply with the requirements of the UCC for a mortgage instrument to be filed as
a financing statement. Mortgagor is the “Debtor” and its name and mailing
address are set forth in the preamble of this Mortgage immediately preceding
Article 1. Mortgagee is the “Secured Party” and its name and mailing address
from which information concerning the security interest granted herein may be
obtained are also set forth in the preamble of this Mortgage immediately
preceding Articles 1. A statement describing the portion of the Mortgaged
Property comprising the fixtures hereby secured is set forth in

 

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Section 1.1(h) of this Mortgage. Mortgagor represents and warrants to Mortgagee
that Mortgagor is the record owner of the applicable fee title or owner of the
leasehold interest in the Mortgaged Property. The employer identification number
of Mortgagor, and its organizational identification number, are set forth on
Schedule 1 hereto.

 

ARTICLE 8

MISCELLANEOUS

 

Section 8.1 Notices. Any notice required or permitted to be given under this
Mortgage shall be given in accordance with Section 11.6 of the Credit Agreement.
Mortgagor agrees that any notice given by Mortgagor to Mortgagee purportedly
pursuant to 42 Pa. C.S.A. § 8143 shall be given by registered or certified mail,
return receipt requested, to the address of Mortgagee specified on the first
page of this Mortgage and only to such address, and such notice shall be deemed
to have been received no earlier than the date actually and physically received
at such address.

 

Section 8.2 Covenants Running with the Land. All obligations contained in this
Mortgage are intended by Mortgagor and Mortgagee to be, and shall be construed
as, covenants running with the Mortgaged Property. As used herein, “Mortgagor”
shall refer to the party named in the first paragraph of this Mortgage and to
any subsequent owner of all or any portion of the Mortgaged Property. All
Persons who may have or acquire an interest in the Mortgaged Property shall be
deemed to have notice of, and be bound by, the terms of this Mortgage; provided,
however, that no such party shall be entitled to any rights, thereunder without
the prior written consent of Mortgagee.

 

Section 8.3 Attorney-in-Fact. Mortgagor hereby irrevocably appoints Mortgagee as
its attorney-in-fact, which agency is coupled with an interest and with full
power of substitution, with full authority in the place and stead of Mortgagor
and in the name of Mortgagor or otherwise (a) to execute and/or record any
notices of completion, cessation of labor or any other notices that Mortgagee
deems appropriate to protect Mortgagee’s interest, if Mortgagor shall fail to do
so within ten (10) days after written request by Mortgagee, (b) upon the
issuance of a deed pursuant to the foreclosure of this Mortgage or the delivery
of a deed in lieu of foreclosure, to execute all instruments of assignment,
conveyance or further assurance with respect to the Leases, Rents, Deposit
Accounts, Property Agreements, Tax Refunds, Permits, Personalty, Proceeds,
Insurance and Condemnation Awards in favor of the grantee of any such deed and
as may be necessary or desirable for such purpose, (c) to prepare, execute, and
file or record financing statements and continuation statements, and to prepare,
execute and file or record applications for registration and like papers
necessary to create, perfect or preserve Mortgagee’s security interests and
rights in or to any of the Mortgaged Property, and (d) after the occurrence and
during the continuance of any Actionable Default, to perform any obligation of
Mortgagor hereunder, provided, however, that (1) Mortgagee shall not under any
circumstances be obligated to perform any obligation of Mortgagor, (2) any sums
advanced by Mortgagee in such performance shall be added to and included in the
Secured Debt and shall bear interest at the highest rate at which interest is
then computed on any portion of the Secured Debt; (3) Mortgagee as such
attorney-in-fact shall only be accountable for such funds as are actually
received by Mortgagee; and (4) Mortgagee shall not be liable to Mortgagor or any
other person or entity for any failure to take any action which it is empowered
to take under this Section 8.3.

 

Section 8.4 Successors and Assigns. This Mortgage shall be binding upon and
inure to the benefit of Mortgagee and Mortgagor and their respective successors
and assigns. Mortgagor shall not, without the prior written consent of
Mortgagee, assign any rights, duties or obligations hereunder.

 

Section 8.5 No Waiver. Any failure by Mortgagee or to insist upon strict
performance of any of the terms, provisions or conditions of the Collateral
Trust Agreement or this Mortgage, or of any other document or instrument
relating to any portion of the Secured Debt, shall not be deemed to be a waiver
of same, and Mortgagee shall have the right at any time to insist upon strict
performance of all of such terms, provisions and conditions.

 

Section 8.6 Conflicts Between Documents. In the event of any conflict between
the provisions of this Mortgage, the Credit Agreement or any of the other
Security Documents and the provisions of the Collateral Trust Agreement, the
provisions of the Collateral Trust Agreement shall control. Notwithstanding any

 

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provision in this Mortgage, the Credit Agreement or any of the Security
Documents to the contrary, the parties and signatories hereto acknowledge and
agree that any and all rights, powers, privileges, duties, responsibilities,
liabilities and/or obligations (including but not limited to the right to grant
or withhold consent and the right to act or refrain from acting), whether
discretionary or mandatory, are and shall be exercised by the Collateral Trustee
solely in accordance with the terms and conditions of the Collateral Trust
Agreement, at the direction of the Credit Facility Agent or other entity
specified in the Collateral Trust Agreement as having the right to give
direction to the Collateral Trustee, and subject further to the rights of the
Collateral Trustee to require officers’ certificate(s), opinion(s) and advice
from counsel, accountants, appraisers and other third parties, advancement of
expenses and/or assurances of indemnity satisfactory to the Collateral Trustee.
If any conflict or inconsistence exists between this Mortgage and the Credit
Agreement, the terms of the Credit Agreement shall govern.

 

Section 8.7 Release or Reconveyance. Upon payment and performance in full of the
Secured Debt, or upon a sale or other disposition of the Mortgaged Property
permitted by the Credit Agreement and the Collateral Trust Agreement, Mortgagee,
at Mortgagor’s request and expense, shall release the liens and security
interests created by this Mortgage or reconvey the Mortgaged Property to
Mortgagor.

 

Section 8.8 Waiver of Stay, Moratorium and Similar Rights. Mortgagor agrees, to
the full extent that it may lawfully do so, that it will not at any time insist
upon or plead or in any way take advantage of any stay, marshalling of assets,
extension, redemption or moratorium law now or hereafter in force and effect so
as to prevent or hinder the enforcement of the provisions of this Mortgage or
the Collateral Trust Agreement, or any agreement between Mortgagor and Mortgagee
or any rights or remedies of Mortgagee.

 

Section 8.9 Applicable Law. The provisions of this Mortgage regarding the
creation, perfection and enforcement of the liens and security interests herein
granted shall be governed by and construed under the laws of the state in which
the Mortgaged Property is located. All other provisions of this Mortgage shall
be governed by the laws of the Commonwealth of Pennsylvania.

 

Section 8.10 Headings. The Article, Section and Subsection titles hereof are
inserted for convenience of reference only and shall in no way alter, modify or
define, or be used in construing, the text of such Articles, Sections or
Subsections.

 

Section 8.11 Severability. If any provision of this Mortgage shall be held by
any court of competent jurisdiction to be unlawful, void or unenforceable for
any reason, such provision shall be deemed severable from and shall in no way
affect the enforceability and validity of the remaining provisions of this
Mortgage.

 

Section 8.12 Entire Agreement. This Mortgage, the Credit Agreement, the
Collateral Trust Agreement, and the Security Documents embody the entire
agreement and understanding between Mortgagee and Mortgagor relating to the
subject matter hereof and thereof and supersede all prior agreements and
understandings between such parties relating to the subject matter hereof and
thereof. Accordingly, such documents may not be contradicted by evidence of
prior, contemporaneous or subsequent oral agreements of the parties. There are
no unwritten oral agreements between the parties.

 

Section 8.13 Mortgagee as Collateral Trustee; Successor Collateral Trustees.

 

(a) Mortgagee shall have the right hereunder to make demands, to give notices,
to exercise or refrain from exercising any rights, and to take or refrain from
taking any action (including, without limitation, the release or substitution of
the Mortgaged Property) in accordance with the terms of the Collateral Trust
Agreement and this Mortgage.

 

(b) Mortgagee shall at all times be the same Person or Persons that comprise the
Collateral Trustee under the Collateral Trust Agreement. Written notice of
resignation by Collateral Trustee pursuant to the Collateral Trust Agreement
shall also constitute notice of resignation as Collateral Trustee under this
Mortgage. Removal of Collateral Trustee pursuant to any provision of the
Collateral Trust Agreement shall also constitute removal as Collateral Trustee
under this Mortgage. Appointment of a successor Collateral Trustee pursuant to
the

 

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Collateral Trust Agreement shall also constitute appointment of a successor
Collateral Trustee under this Mortgage. Upon the acceptance of any appointment
as Collateral Trustee by a successor Collateral Trustee under the Collateral
Trust Agreement, that successor Collateral Trustee shall thereupon succeed to
and become vested with all the rights, powers, privileges and duties of the
retiring or removed Collateral Trustee as the Mortgagee under this Mortgage, and
the retiring or removed Collateral Trustee shall promptly (i) assign and
transfer to such successor Collateral Trustee all of its right, title and
interest in and to this Mortgage and the Mortgaged Property, and (ii) execute
and deliver to such successor Collateral Trustee such assignments and amendments
and take such other actions, as may be necessary or appropriate in connection
with the assignment to such successor Collateral Trustee of the liens and
security interests created hereunder, whereupon such retiring or removed
Collateral Trustee shall be discharged from its duties and obligations under
this Mortgage. After any retiring or removed Collateral Trustee’s resignation or
removal hereunder as Collateral Trustee, the provisions of this Mortgage and the
Collateral Trust Agreement shall inure to its benefit as to any actions taken or
omitted to be taken by it under this Mortgage while it was Collateral Trustee
hereunder.

 

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Section 8.14 WAIVER OF TRIAL BY JURY.

 

MORTGAGOR AND MORTGAGEE EACH WAIVES THE RIGHT TO A TRIAL BY JURY IN ANY ACTION
OR PROCEEDING BASED UPON OR RELATED TO THE SUBJECT MATTER OF THIS MORTGAGE OR
THE COLLATERAL TRUST AGREEMENT, OR ANY OF THE OTHER SECURITY DOCUMENTS, OR ANY
OF THE TRANSACTIONS RELATED TO ANY OF THE SECURED DEBT. THIS WAIVER IS
KNOWINGLY, INTENTIONALLY AND VOLUNTARILY MADE BY MORTGAGOR AND MORTGAGEE, AND
MORTGAGOR AND MORTGAGEE EACH ACKNOWLEDGES THAT NEITHER THE OTHER NOR ANY PERSON
ACTING ON BEHALF OF THE OTHER HAS OR HAVE MADE ANY REPRESENTATIONS OF FACT TO
INDUCE THIS WAIVER OF TRIAL BY JURY OR IN ANY WAY TO MODIFY OR NULLIFY ITS
EFFECT. MORTGAGOR AND MORTGAGEE EACH FURTHER ACKNOWLEDGES THAT IT HAS BEEN
REPRESENTED (OR HAS HAD THE OPPORTUNITY TO BE REPRESENTED) IN THE SIGNING OF
THIS AGREEMENT AND IN THE MAKING OF THIS WAIVER BY INDEPENDENT LEGAL COUNSEL
SELECTED OF ITS OWN FREE WILL AND THAT IT HAS HAD THE OPPORTUNITY TO DISCUSS
THIS WAIVER WITH COUNSEL. MORTGAGOR AND MORTGAGEE EACH AGREES THAT THE SECURED
DEBT ARE EXEMPTED TRANSACTIONS UNDER THE TRUTH-IN-LENDING ACT, 15 U.S.C. SECTION
1601, ET SEQ.

 

Initials of Mortgagor:

 

______________

 

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ARTICLE 9

LOCAL LAW PROVISIONS

 

Section 9.1 Inconsistencies. In the event of any inconsistencies between the
terms and conditions of this Article 9 and the other provisions of this
Mortgage, the terms and conditions of this Article 9 shall control and be
binding.

 

Section 9.2 Certain Future Advances. If Mortgagor sends a written notice to
Mortgagee which purports to limit the Secured Debt and to release the obligation
of Mortgagee and the other Lenders to make any additional advances to Mortgagor
in accordance with the terms of the Credit Agreement, such notice shall be
ineffective as to any future advances made: (a) to enable completion of any
erection, construction, alteration or repair of any part of the Mortgaged
Property; (b) to pay taxes, assessments, maintenance charges and insurance
premiums; (c) for costs incurred for the protection of the Mortgaged Property or
the lien of the Mortgage; (d) for expenses incurred by Mortgagee by reason of a
default by Mortgagor hereunder or with respect to any portion of the Secured
Debt; and (e) for any other costs incurred by Mortgagee to protect and preserve
the Mortgaged Property. It is the intention of the parties hereto that any such
advance made by Mortgagee or any of the other Lenders after any such notice by
Mortgagor shall be secured by the lien of this Mortgage on the Mortgaged
Property.

 

Section 9.3 Additional Rights and Remedies. Without limitation of the provisions
of Article 5 hereof, it is expressly agreed that if at any time following an
Actionable Default hereunder (a) a writ of execution is issued upon a judgment
obtained upon the Secured Debt, or any portion thereof, or (b) an action of
mortgage foreclosure or any other action or proceeding is instituted in respect
of this Mortgage, there shall be payable to and recovered by Mortgagee (i) the
entire unpaid principal balance of the Secured Debt, with interest thereon at
the interest rate then applicable under the Collateral Trust Agreement, (ii) all
costs of suit (including reasonable attorneys’ fees, forum costs and
disbursements), (iii) all moneys expended by Mortgagee in payment of taxes,
sewer rents and water rents, claims or charges and in effecting insurance
coverage or repairs, with interest on such expenditures at the interest rate
applicable under the Collateral Trust Agreement, and (iv) a reasonable
attorney’s commission for collection. Mortgagor hereby waives and relinquishes
unto Mortgagee the right of inquisition in respect of any real estate that may
be levied upon under a judgment obtained by virtue of any such action or
proceeding and voluntarily condemns the same and authorizes the entry of such
condemnation upon such writ of execution. Mortgagor further agrees that such
real estate and any other Mortgaged Property (whether consisting of real or
personal property) now or hereafter owned by Mortgagor may be sold in any order
determined by Mortgagee. Mortgagor likewise waives and relinquishes all benefit
of any and every law now or hereafter in force to exempt from levy and sale on
execution the Mortgaged Property or any other property whatsoever or any part of
the proceeds arising from any such sale for the payment of the Secured Debt (or
any part thereof) and the legal fees and costs of such action and execution,
Mortgagor likewise waives and relinquishes unto and in favor of Mortgagee all
benefits and exemptions under the laws now in effect or hereafter passed to
relieve Mortgagor in any manner from the obligations assumed in connection with
all Secured Debt, or to reduce the amount due hereunder.

 

S-16

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Section 9.4 CONFESSION OF JUDGMENT IN EJECTMENT.

 

THE FOLLOWING PARAGRAPH WAIVES THE RIGHT TO HAVE PRIOR NOTICE AND AN OPPORTUNITY
FOR HEARING UNDER THE CONSTITUTION AND LAWS OF THE UNITED STATES AND THE
COMMONWEALTH OF PENNSYLVANIA PRIOR TO THE ENTRY OF JUDGMENT FOR POSSESSION OF
THE REAL PROPERTY SECURED BY THIS MORTGAGE:

 

MORTGAGOR, FOR THE PURPOSE OF SECURING POSSESSION OF THE MORTGAGED PROPERTY TO
MORTGAGEE IN THE EVENT OF ANY ACTIONABLE DEFAULT HEREUNDER, DOES HEREBY
AUTHORIZE AND EMPOWER ANY ATTORNEY OF ANY COURT OF RECORD IN THE COMMONWEALTH OF
PENNSYLVANIA, AS ATTORNEY FOR MORTGAGOR AS WELL AS FOR ALL PERSONS CLAIMING
UNDER, BY OR THROUGH MORTGAGOR, TO COMMENCE AN ACTION IN EJECTMENT FOR
POSSESSION OF THE MORTGAGED PROPERTY WITHOUT ANY STAY OF EXECUTION OR APPEAL,
AGAINST MORTGAGOR, AND THEREIN TO CONFESS JUDGMENT FOR THE RECOVERY BY MORTGAGEE
OF THE POSSESSION OF THE MORTGAGED PROPERTY FOR WHICH THIS MORTGAGE (OR A COPY
THEREOF VERIFIED BY AFFIDAVIT) SHALL BE SUFFICIENT WARRANT, AND THEREUPON A WRIT
OF POSSESSION MAY BE ISSUED FORTHWITH, WITHOUT ANY PRIOR WRIT, FORECLOSURE OR
PROCEEDING WHATSOEVER. MORTGAGOR HEREBY RELEASES AND AGREES TO RELEASE MORTGAGEE
FROM ALL ERRORS AND DEFECTS WHATSOEVER IN CONNECTION WITH SUCH JUDGMENT IN
CAUSING A WRIT OR WRIT TO BE ISSUED, AND IN ANY PROCEEDINGS THEREON ON
CONCERNING THE SAME. MORTGAGE AGREES THAT NO WRIT, ERROR, APPEAL OR OBJECTION
SHALL BE MADE OR TAKEN THERETO, PROVIDED THAT MORTGAGEE SHALL HAVE FILED IN SUCH
ACTION AN AFFIDAVIT OF DEFAULT MADE BY IT OR SOMEONE ON ITS BEHALF. IT IS HEREBY
EXPRESSLY AGREED THAT IF FOR ANY REASON AFTER SUCH ACTION HAS BEEN COMMENCED,
THE SAME SHALL BE DISCONTINUED, MARKED SATISFIED OF RECORD, OR DETERMINED, OR
POSSESSION OF THE MORTGAGED PROPERTY SHALL REMAIN IN OR TO BE RESTORED TO
MORTGAGOR, THE RIGHTS AND POWERS OF MORTGAGEE SHALL NOT BE DEEMED TO HAVE BEEN
EXHAUSTED BY ANY SUCH ACTION, BUT MORTGAGEE SHALL HAVE THE SAME RIGHTS AS
AFORESAID, FOR THE SAME ACTIONABLE DEFAULT, OR FOR ANY SUBSEQUENT EVENT OR
EVENTS OF DEFAULT TO CONFESS JUDGMENT AND TO BRING ONE OR MORE FURTHER ACTIONS
TO RECOVER POSSESSION OF THE MORTGAGED PROPERTY. IN ANY SUCH ACTION, A COPY OF
THIS MORTGAGE, VERIFIED BY AFFIDAVIT BY SOMEONE ON BEHALF OF MORTGAGEE MAY BE
FILED, IN WHICH EVENT IT SHALL NOT BE NECESSARY TO FILE THE ORIGINAL AS A
WARRANT OF ATTORNEY, ANY LAW OR RULE OF COURT TO THE CONTRARY NOTWITHSTANDING.
THE RIGHT SET FORTH HEREIN SHALL NOT MERGE WITH ANY JUDGMENT OBTAINED ON THE
SECURED DEBT. MORTGAGEE MAY COMMENCE AN ACTION IN EJECTMENT FOR POSSESSION OF
THE PREMISES BEFORE OR AFTER THE INSTITUTION OF FORECLOSURE PROCEEDINGS UPON
THIS MORTGAGE, OR BEFORE OR AFTER JUDGMENT FOR ANY PORTION OF THE SECURED DEBT,
OR BEFORE OR AFTER A SALE OF THE PREMISES BY THE SHERIFF, MARSHAL, CONSTABLE OR
OTHER PROPER LEGAL OFFICER.

 

                                                                               
   Mortgagor’s Initials

 

Section 9.5 Construction Mortgage. This Mortgage is intended to be a
Construction Mortgage within the meaning of 13 Pa. C.S.A. § 2A309(a).

 

[The remainder of this page has been intentionally left blank]

 

S-17

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IN WITNESS WHEREOF, Mortgagor has on the date set forth in the acknowledgement
hereto, effective as of the date first above written, caused this instrument to
be duly EXECUTED AND DELIVERED by authority duly given.

 

MORTGAGOR:                                                  ., a
                            

By:

       

Name:

   

Title:

Attest:

       

Name:

   

Title:

 

[Sections 8.14 and 9.4 must be initialed]

 

S-1

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STATE OF                                                                        
)         )   ss.: COUNTY OF                                   
                                 )    

 

On this, the      day of June 2004, before me, a notary public, the undersigned
officer, personally appeared                     , who acknowledged himself to
be the                      of                     ., a Delaware corporation,
and that he as such officer, being authorized to do so, executed the foregoing
instrument for the purposes therein contained by signing the name of the
corporation by himself as such officer.

 

In witness whereof, I hereunto set my hand and official seal.

 

 

Notary Public

 

N-1

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EXHIBIT A

 

LEGAL DESCRIPTION — MINE HEAD SITE

 

[See Attached Page(s) For Legal Description]

 

--------------------------------------------------------------------------------

EXHIBIT B

 

LEGAL DESCRIPTION — FIVE YEAR MINE PLAN PROPERTIES

 

[See Attached Page(s) For Legal Description]

 

22

--------------------------------------------------------------------------------

EXHIBIT C

 

RESERVE PROPERTY WITHOUT WARRANTY OF TITLE

 

[See Attached Page(s) For Legal Description]

 

--------------------------------------------------------------------------------

EXHIBIT D

 

OPERATING PROPERTIES WITHOUT WARRANTY OF TITLE

 

[See Attached Page(s) For Legal Description]

 

--------------------------------------------------------------------------------

SCHEDULE 1

 

Name of Grantor

--------------------------------------------------------------------------------

   State of Incorporation

--------------------------------------------------------------------------------

   Employer ID#

--------------------------------------------------------------------------------

   Organization ID#

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

EXHIBIT 1.1(P)(1)

 

FORM OF

PATENT, TRADEMARK AND COPYRIGHT SECURITY AGREEMENT

 

This Patent, Trademark and Copyright Security Agreement (the “Agreement”), dated
as of June 30, 2004 is entered into by and among each of the undersigned parties
listed on the signature pages hereto as Pledgors and each of the other persons
and entities that become bound hereby from time to time by joinder, assumption,
or otherwise (each a “Pledgor” and collectively, the “Pledgors”), and WILMINGTON
TRUST COMPANY, a Delaware banking corporation, not in its individual capacity
but solely as collateral trustee (the “Collateral Trustee”) for the equal and
ratable benefit of the Secured Parties (as defined below) pursuant to the
Collateral Trust Agreement (as defined below).

 

WHEREAS, pursuant to that certain Credit Agreement of even date herewith by and
among CONSOL Energy Inc., as borrower (the “Borrower”), the Guarantors now or
hereafter party thereto, the Lenders from time to time party thereto (the
“Lenders”), LaSalle Bank National Association, Société Générale, New York Branch
and SunTrust Bank, each in its capacity as a co-documentation agent, and
Citibank North America, Inc. and PNC Bank, National Association in their
capacity as co-administrative agents (collectively, the “Co-Administrative
Agents”), (as amended, restated, modified or supplemented from time to time, the
“Credit Agreement”), the Co-Administrative Agents and the Lenders have agreed to
make Loans to, and issue Letters of Credit on behalf of, the Borrower and its
Subsidiaries.

 

WHEREAS, pursuant to the Credit Agreement and that certain Issuing and Paying
Agency Agreement, dated December 31, 1991, among the Borrower, certain of its
Subsidiaries (as defined in the Credit Agreement) and The Bank of Nova Scotia
Trust Company of New York as successor-in-interest to Morgan Guaranty Trust
Company of New York, as paying agent (as supplemented, modified, amended or
restated from time to time, the “Issuing and Paying Agency Agreement”), and that
certain Indenture, dated March 7, 2002, among the Borrower, certain of its
Subsidiaries and The Bank of Nova Scotia Trust Company of New York, as trustee
(as supplemented, modified, amended or restated from time to time, the
“Indenture”), the Collateral Trustee has entered into that certain Collateral
Trust Agreement, dated of even date herewith (as supplemented, modified, amended
or restated from time to time, the “Collateral Trust Agreement”) with the
Borrower, David A. Vanaskey, as individual trustee, and the Designated
Subsidiaries (as defined therein) to accept the grant of a security interest
under this Agreement as security for the Secured Obligations (as defined below)
for the equal and ratable benefit of the Secured Parties.

 

WHEREAS, the obligation of the Lenders to make Loans and extend credit under the
Credit Agreement is subject to the condition, among others, that the Pledgors
grant a security interest to the Collateral Trustee in certain patents,
trademarks, copyrights and other property as security for Secured Obligations.

 

--------------------------------------------------------------------------------

NOW, THEREFORE, intending to be legally bound hereby, the parties hereto agree
as follows:

 

1. Defined Terms.

 

(a) Except as otherwise expressly provided herein, (i) capitalized terms used in
this Agreement shall have the respective meanings assigned to them in the Credit
Agreement and (ii) the rules of construction set forth in Section 1.2
[Construction] of the Credit Agreement shall apply to this Agreement. Where
applicable and except as otherwise expressly provided herein, terms used herein
(whether or not capitalized) shall have the respective meanings assigned to them
in the Uniform Commercial Code as enacted in Pennsylvania as amended from time
to time (the “Code”).

 

(b) “Debt Instruments” shall have the meaning set forth in the Collateral Trust
Agreement.

 

(c) “Event of Default” shall mean an Actionable Default (as defined in the
Collateral Trust Agreement).

 

(d) “Patents, Trademarks and Copyrights” shall mean and include all of each
Pledgor’s present and future right, title and interest in and to the following:
all trade names, patent applications, patents, trademark applications,
trademarks and copyrights, whether now owned or hereafter acquired by each
Pledgor, including, without limitation, those listed on Schedule A hereto (as
such Schedule A may be supplemented from time to time by notice to the
Collateral Trustee from any Pledgor), including all proceeds thereof (such as,
by way of example, license royalties and proceeds of infringement suits), the
right to sue for past, present and future infringements, all rights
corresponding thereto throughout the world and all reissues, divisions,
continuations, renewals, extensions and continuations-in-part thereof, and the
goodwill of the business to which any of the patents, trademarks and copyrights
relate, except for the assets described on Schedule 8.1.16 of the Credit
Agreement and pursuant to Section 8.1.16 of the Credit Agreement, assets
acquired in a Permitted Acquisition and to the extent and only so long as
encumbered by a Lien permitted by clause (xiii) or (xv) of the definition of
Permitted Liens in the Credit Agreement, and except intent-to-use trademark
applications to the extent that, and solely during the period in which, the
grant of a security interest therein would impair the validity or enforceability
of such intent-to-use trademark applications under applicable federal law.

 

(e) “Secured Obligations” shall mean the Secured Debt (as defined in the
Collateral Trust Agreement).

 

(f) “Secured Parties” shall mean, collectively, the Collateral Trustees (as
defined in the Collateral Trust Agreement), the Co-Administrative Agents, the
Paying Agent, the Lenders, The Bank of Nova Scotia Trust Company of New York or
any successor thereto, as paying agent under the Issuing and Paying Agency
Agreement and as trustee under the Indenture, and any holders from time to time
of the Secured Obligations, and “Secured Party” shall mean each of them
individually.

 

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2. To secure the full payment and performance of all Secured Obligations, each
Pledgor hereby grants, and conveys a security interest to the Collateral Trustee
for the equal and ratable benefit of the Secured Parties in the entire right,
title and interest of such Pledgor in and to all of its Patents, Trademarks and
Copyrights.

 

3. Each Pledgor jointly and severally represents and warrants that:

 

(a) the material Patents, Trademarks and Copyrights are subsisting and have not
been adjudged invalid or unenforceable, in whole or in part, except to the
extent that the failure to be subsisting or the invalidity or unenforceability
of such Patents, Trademarks and Copyrights would not reasonably be expected to
result in a Material Adverse Change;

 

(b) to the best of such Pledgor’s knowledge, each of the material Patents,
Trademarks and Copyrights is valid and enforceable, except to the extent that
the failure to be valid and enforceable would not reasonably be expected to
result in a Material Adverse Change;

 

(c) such Pledgor is the sole and exclusive owner of the entire and unencumbered
right, title and interest in and to each of the material Patents, Trademarks and
Copyrights, free and clear of any liens, charges and encumbrances, including
without limitation pledges, assignments, licenses, shop rights and covenants by
such Pledgor not to sue third persons, other than Permitted Liens and other than
license agreements entered into in good faith in an arm’s length transaction;

 

(d) such Pledgor has the corporate power and authority to enter into this
Agreement and perform its terms;

 

(e) no claim has been made to such Pledgor or, to the knowledge of such Pledgor,
any other person that the use of any of the material Patents, Trademarks and
Copyrights does or may violate the rights of any third party where such claim
would reasonably be expected to result in a Material Adverse Change; and

 

(f) such Pledgor has used proper statutory notice in connection with its use of
the material Patents, Trademarks and Copyrights, except for those Patents,
Trademarks and Copyrights that are hereafter allowed to lapse in accordance with
Paragraph 11 hereof and except where the failure to use such notice would not
reasonably be expected to result in a Material Adverse Change.

 

4. Each of the obligations of each Pledgor under this Agreement is joint and
several. The Collateral Trustee may, in its sole discretion, elect to enforce
this Agreement against any Pledgor without any duty or responsibility to pursue
any other Pledgor and such an election by the Collateral Trustee, shall not be a
defense to any action the Collateral Trustee and the Secured Parties, or any of
them, may elect to take against any Pledgor. Each of the Secured Parties and the
Collateral Trustee hereby reserve all rights against each Pledgor.

 

5. (a) Each Pledgor agrees that, for the duration of the Agreement, it will not
enter into any agreement (for example, a license agreement) which is
inconsistent with such Pledgor’s obligations under this Agreement, without the
Collateral Trustee’s prior written consent which shall not be unreasonably
withheld except such Pledgor may license technology in the

 

-3-

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ordinary course of business without the Collateral Trustee’s consent to
suppliers and customers to facilitate the manufacture and use of such Pledgor’s
products and may otherwise enter into license agreements in an arm’s length
transaction entered into in good faith.

 

(b) Each Pledgor agrees that it will, for the duration of this Agreement, use
proper statutory notice in connection with its use of the material Patents,
Trademarks and Copyrights, except for those Patents, Trademarks and Copyrights
that are hereafter allowed to lapse in accordance with Paragraph 11 hereof and
except where the failure to use such notice would not reasonably be expected to
result in a Material Adverse Change.

 

(c) No Pledgor will change its state of incorporation, formation or
organization, as applicable without providing thirty (30) days prior written
notice the Collateral Trustee.

 

(d) No Pledgor will change its name without providing thirty (30) days prior
written notice the Collateral Trustee.

 

(e) Except as permitted by the Credit Agreement, each Pledgor (i) shall preserve
its corporate existence (ii) shall not in one, or a series of related
transactions, merge into or consolidate with any other entity, the survivor of
which is not such Pledgor, or (iii) shall not in one, or a series of related
transactions, sell all or substantially all of its assets.

 

6. If, during the duration of this Agreement, any Pledgor shall own any Patents,
Trademarks and Copyrights, or any patent application or patent for any reissue,
division, continuation, renewal, extension, or continuation in part of any
Patent, Trademark or Copyright or any improvement on any Patent, Trademark or
Copyright, the provisions of this Agreement shall automatically apply thereto
and such Pledgor shall give to the Collateral Trustee quarterly notice thereof
in writing. Each Pledgor and the Collateral Trustee agree to modify this
Agreement by amending Schedule A to include any future Patents, Trademarks and
Copyrights and the provisions of this Agreement shall apply thereto.

 

7. The Collateral Trustee shall have, in addition to all other rights and
remedies given it by this Agreement and those rights and remedies set forth in
the Collateral Trust Agreement, those allowed by applicable Law and the rights
and remedies of a secured party under the Uniform Commercial Code as enacted in
any jurisdiction in which the Patents, Trademarks and Copyrights may be located
and, without limiting the generality of the foregoing, if an Event of Default
has occurred and is continuing, the Collateral Trustee may immediately, without
demand of performance and without other notice (except as set forth below) or
demand whatsoever to any Pledgor, all of which are hereby expressly waived, and
without advertisement, sell at public or private sale or otherwise realize upon,
in a city that the Collateral Trustee shall designate by notice to the Pledgors,
in Pittsburgh, Pennsylvania, or elsewhere, the whole or from time to time any
part of the Patents, Trademarks and Copyrights, or any interest which any
Pledgor may have therein and the proceeds of sale or other disposition of the
Patents, Trademarks and Copyrights shall be applied as provided in the
Collateral Trust Agreement. Any remainder of the proceeds after payment in full
of the Secured Obligations shall be paid over to such Pledgor. Notice of any
sale or other disposition of the Patents, Trademarks and Copyrights shall be
given to Pledgors at least ten (10) days before the time of any intended public
or private sale or other disposition of the

 

-4-

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Patents, Trademarks and Copyrights is to be made, which each Pledgor hereby
agrees shall be reasonable notice of such sale or other disposition. At any such
sale or other disposition, the Collateral Trustee and any Secured Party may, to
the extent permissible under applicable Law, purchase the whole or any part of
the Patents, Trademarks and Copyrights sold, free from any right of redemption
on the part of any Pledgor, which right is hereby waived and released.

 

8. If any Event of Default shall have occurred and be continuing, each Pledgor
hereby authorizes and empowers the Collateral Trustee to make, constitute and
appoint any officer or agent of the Collateral Trustee, as the Collateral
Trustee may select in its exclusive discretion, as such Pledgor’s true and
lawful attorney-in-fact, with the power to endorse such Pledgor’s name on all
applications, documents, papers and instruments necessary for Collateral Trustee
to use the Patents, Trademarks and Copyrights, or to grant or issue, on
commercially reasonable terms, any exclusive or nonexclusive license under the
Patents, Trademarks and Copyrights to any third person, or necessary for the
Collateral Trustee to assign, pledge, convey or otherwise transfer title in or
dispose, on commercially reasonable terms, of the Patents, Trademarks and
Copyrights to any third Person. Each Pledgor hereby ratifies all that such
attorney shall lawfully do or cause to be done by virtue hereof. This power of
attorney, being coupled with an interest, shall be irrevocable for the life of
this Agreement.

 

9. This Agreement shall terminate upon the satisfaction of the conditions set
forth in, and in accordance with the provisions of, Section 6 of the Collateral
Trust Agreement. All or any portion of the Patents, Trademarks and Copyrights
shall be released upon the satisfaction of the conditions set forth in, and in
accordance with the provisions of, Section 6 of the Collateral Trust Agreement.

 

10. [Intentionally Deleted]

 

11. Each Pledgor shall have the duty to prosecute diligently any patent
applications of the material Patents, Trademarks and Copyrights pending as of
the date of this Agreement if commercially reasonable, except where the failure
to so prosecute would not reasonably be expected to result in a Material Adverse
Change. Thereafter, until the Secured Obligations shall have been paid in full
and the Commitments shall have terminated and all of the Letters of Credit and
Specified Swap Agreements have expired, each Pledgor shall make application on
unpatented but patentable inventions (whenever it is commercially reasonable in
the reasonable judgment of such Pledgor to do so) and to preserve and maintain
all rights in patent applications and patents of the Patents, including without
limitation the payment of all maintenance fees, except where the failure to make
such applications to preserve or maintain such rights would not reasonably be
expected to result in a Material Adverse Change. Any expenses incurred in
connection with such an application shall be borne by the Pledgors. No Pledgor
shall abandon any material Patent, Trademark or Copyright without the consent of
the Collateral Trustee, which shall not be unreasonably withheld, unless such
abandonment would not reasonably be expected to result in a Material Adverse
Change.

 

12. Each Pledgor shall have the right to bring suit, action or other proceeding
in its own name and, with the consent of the Collateral Trustee, which shall not
be unreasonably withheld, to join the Collateral Trustee, if necessary, as a
party to such suit so long as the

 

-5-

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Collateral Trustee is satisfied that such joinder will not subject it to any
material risk of liability, to enforce the Patents, Trademarks and Copyrights
and any licenses thereunder. Each Pledgor shall promptly, upon demand, reimburse
and indemnify the Collateral Trustee for all damages, costs and expenses,
including reasonable legal fees, incurred by the Collateral Trustee as a result
of such suit or joinder by such Pledgor pursuant to the Collateral Trust
Agreement.

 

13. (a) No course of dealing between any Pledgor and the Collateral Trustee, nor
any failure to exercise nor any delay in exercising, on the part of the
Collateral Trustee, any right, power or privilege hereunder shall operate as a
waiver of such right, power or privilege, nor shall any single or partial
exercise of any right, power or privilege hereunder or thereunder preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege. No waiver of a single Event of Default shall be deemed a waiver of a
subsequent Event of Default. All waivers under this Agreement must be in
writing. The rights and remedies of the Collateral Trustee under this Agreement
are cumulative and in addition to any rights or remedies which it may otherwise
have, and the Collateral Trustee may enforce any one or more remedies hereunder
successively or concurrently at its option.

 

(b) The Secured Parties may, at any time and from time to time, without notice
to or the consent of the Pledgors unless otherwise required pursuant to the
terms of any of the Secured Obligations, the Debt Instruments or the Collateral
Trust Agreement, and without impairing or releasing, discharging or modifying
any Pledgor’s liabilities hereunder, (i) change the manner, place, time or terms
of payment or performance of or interest rates on, or any other terms relating
to, any of the Secured Obligations; (ii) take such actions to or cause the
Collateral Trustee to renew, substitute, modify, impair, amend or alter, or
grant consents or waivers relating to any Debt Instrument or any of the Secured
Obligations, any other pledge or security agreements, or any security for any of
the Secured Obligations; (iii) take such actions to or cause the Collateral
Trustee to apply any and all payments by whomever paid or however realized
including any proceeds of any collateral, to any of the Secured Obligations of
the Pledgors in such order, manner and amount as provided in the Collateral
Trust Agreement ; (iv) take such actions to or cause the Collateral Trustee to
deal with any other person with respect to any of the Secured Obligations in
such manner as the Secured Parties deem appropriate in their respective sole
discretion; (v) take such actions to or cause the Collateral Trustee to
substitute, exchange, impair or release any security or guaranty; or (vi) take
or cause the Collateral Trustee to take such actions and exercise such remedies
hereunder as provided herein. Each Pledgor hereby waives (a) presentment,
protest, notice of dishonor and notice of non-payment, and (b) all defenses
based on suretyship, impairment of collateral, or the like, other than, and to
the extent of, the defense of prior payment of the Secured Obligations.

 

14. [Intentionally Deleted]

 

15. The provisions of this Agreement are intended to be severable. If any
provision of this Agreement shall be held invalid or unenforceable in whole or
in part in any jurisdiction, such provision shall, as to such jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without in any
manner affecting the validity or enforceability thereof in any other
jurisdiction or the remaining provisions hereof in any jurisdiction.

 

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16. This Agreement is subject to modification only by a writing signed by the
parties, except as provided in Paragraph 6.

 

17. (a) The benefits and burdens of this Agreement shall inure to the benefit of
and be binding upon the respective successors and permitted assigns of the
parties, provided, however, that no Pledgor may assign or transfer any of its
rights or obligations hereunder or any interest herein other than assignments
and transfers permitted by the Credit Agreement.

 

(b) The Collateral Trustee may resign and a successor Collateral Trustee may be
appointed in the manner provided in the Collateral Trust Agreement. Upon the
acceptance of any appointment as a collateral trustee by a successor collateral
trustee, that successor collateral trustee shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring
collateral trustee, as secured party under this Agreement and the retiring
collateral trustee shall thereupon be discharged from its duties and obligations
under this Agreement. After any retiring collateral trustee’s resignation, the
provisions of this Agreement shall inure to its benefit as to any actions taken
or omitted to be taken by it under this Agreement while it was Collateral
Trustee.

 

18. This Agreement shall be deemed to be a contract under the laws of the
Commonwealth of Pennsylvania and for all purposes shall be governed by and
construed in accordance with the laws of said Commonwealth without regard to its
conflict of laws principles, except to the extent that the validity or
perfection of the Lien and the security interest hereunder, or remedies
hereunder, in respect of any particular Patents, Trademarks and Copyrights are
governed by the laws of a jurisdiction other than the Commonwealth of
Pennsylvania.

 

19. EACH PLEDGOR AND THE COLLATERAL TRUSTEE HEREBY IRREVOCABLY CONSENTS TO THE
NONEXCLUSIVE JURISDICTION OF THE COURT OF COMMON PLEAS OF ALLEGHENY COUNTY AND
THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF PENNSYLVANIA AND
THE DELAWARE STATE AND UNITED STATES DISTRICT COURTS LOCATED IN WILMINGTON,
DELAWARE, AND WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS UPON IT AND
CONSENTS THAT ALL SUCH SERVICE OF PROCESS BE MADE BY CERTIFIED OR REGISTERED
MAIL DIRECTED TO SUCH PLEDGOR OR THE COLLATERAL TRUSTEE AT THE ADDRESSES
PROVIDED FOR IN SECTION 21 HEREOF AND SERVICE SO MADE SHALL BE DEEMED TO BE
COMPLETED UPON ACTUAL RECEIPT THEREOF. EACH PLEDGOR AND THE COLLATERAL TRUSTEE
WAIVES ANY OBJECTION TO JURISDICTION AND VENUE OF ANY ACTION INSTITUTED AGAINST
IT AS PROVIDED HEREIN AND AGREES NOT TO ASSERT ANY DEFENSE BASED ON LACK OF
JURISDICTION OR VENUE.

 

EACH PLEDGOR AND THE COLLATERAL TRUSTEE HEREBY WAIVES TRIAL BY JURY IN ANY
ACTION, SUIT, PROCEEDING OR COUNTERCLAIM OF ANY KIND ARISING OUT OF OR RELATED
TO THIS AGREEMENT OR THE COLLATERAL TO THE FULL EXTENT PERMITTED BY LAW.

 

-7-

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20. This Agreement may be executed by different parties hereto on any number of
separate counterparts, each of which, when so executed and delivered, shall be
an original, and all such counterparts shall together constitute one and the
same instrument. Delivery of an executed signature page by telecopy or
electronic signature delivery system (in either case in a form acceptable to the
Collateral Trustee) shall be effective as delivery of a manually executed
signature page to this Agreement.

 

21. All notices, requests, demands, directions and other communications
(collectively, “notices”) given to or made upon any party hereto under the
provisions of this Agreement shall be as set forth in Section 11.6 [Notices] of
the Credit Agreement in the case of the Pledgors and as set forth in Section 7.2
of the Collateral Trust Agreement in the case of the Collateral Trustee.

 

22. Each Pledgor acknowledges and agrees that, in addition to the other rights
of the Collateral Trustee hereunder and under the other Loan Documents to which
it is a party, because the Collateral Trustee’s remedies at law for failure of
such Pledgor to comply with the provisions hereof relating to the Collateral
Trustee’s rights (i) to inspect the books and records related to the Patents,
Trademarks and Copyrights, (ii) to receive the various notifications such
Pledgor is required to deliver hereunder, (iii) to obtain copies of agreements
and documents as provided herein with respect to the Patents, Trademarks and
Copyrights, (iv) to enforce the provisions hereof pursuant to which the such
Pledgor has appointed the Collateral Trustee its attorney-in-fact, and (v) to
enforce the Collateral Trustee’s remedies hereunder, would be inadequate and
that any such failure would not be adequately compensable in damages, such
Pledgor agrees that each such provision hereof may be specifically enforced.

 

23. The parties agree that in the event of any conflict between the provisions
of this Agreement and the provisions of the Collateral Trust Agreement, the
provisions of the Collateral Trust Agreement shall control. Notwithstanding any
provision in this Agreement to the contrary, the parties and signatories hereto
acknowledge and agree that any and all rights, powers, privileges, duties,
responsibilities, liabilities and/or obligations (including but not limited to
the right to grant or withhold consent and the right to act or refrain from
acting), whether discretionary or mandatory, are and shall be exercised by the
Collateral Trustee solely in accordance with the terms and conditions of the
Collateral Trust Agreement, at the direction of the Credit Facility Agent (as
defined in the Collateral Trust Agreement) or other entity specified in the
Collateral Trust Agreement as having the right to give direction to the
Collateral Trustee, and subject further to the rights of the Collateral Trustee
to require officers’ certificate(s), opinion(s) and advice from counsel,
accountants, appraisers and other third parties, advancement of expenses and/or
assurances of indemnity satisfactory to the Collateral Trustee.

 

[SIGNATURES APPEAR ON FOLLOWING PAGES]

 

-8-

--------------------------------------------------------------------------------

[SIGNATURE PAGE TO PATENT, TRADEMARK

AND COPYRIGHT SECURITY AGREEMENT]

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective officers or agents thereunto duly authorized, as of the date
first above written.

 

        PLEDGORS:    

ATTEST:

      [INSERT]     Title:           By:       (SEAL)             Name:          
      Title:    

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE TO PATENT, TRADEMARK

AND COPYRIGHT SECURITY AGREEMENT]

 

COLLATERAL TRUSTEE:

WILMINGTON TRUST COMPANY, as

Collateral Trustee

By:     Name:     Title:    

 

--------------------------------------------------------------------------------

SCHEDULE A

TO

PATENT, TRADEMARK AND COPYRIGHT SECURITY AGREEMENT

 

LIST OF REGISTERED PATENTS, TRADEMARKS,

TRADE NAMES AND COPYRIGHTS

 

I. PATENTS

 

GRANTOR

--------------------------------------------------------------------------------

  

PATENT TITLE

--------------------------------------------------------------------------------

  

COUNTRY

--------------------------------------------------------------------------------

   PATENT
NO.

--------------------------------------------------------------------------------

   FILING
DATE

--------------------------------------------------------------------------------

   ISSUE
DATE

--------------------------------------------------------------------------------

CONSOL Energy Inc.

   Method and Apparatus for Separation Measurement and Alignment System   
United States    5,185,935    7/11/91    2/16/93

CONSOL Energy Inc.

   Method for Providing Temporary Support for an Extended Conveyor Belt   
United States    5,938,004    2/14/97    8/17/99

CONSOL Energy Inc.

   An Air Flow Reversal Prevention Door Assembly    United States    5,921,862
   1/30/98    7/13/99

CONSOL Energy Inc.

   Apparatus and Method for Temporary Support and Isolation for a Conveyor Belt
   United States    6,659,269    7/27/00    12/9/03

 

--------------------------------------------------------------------------------

(a) II. DOMAIN NAMES AND TRADEMARKS

 

GRANTOR

--------------------------------------------------------------------------------

  

COUNTRY

--------------------------------------------------------------------------------

  

MARK

--------------------------------------------------------------------------------

   REG. NO.

--------------------------------------------------------------------------------

   ISSUE
DATE

--------------------------------------------------------------------------------

CONSOL Energy Inc.

   United States    CONSOL ENERGY    2,756,594    8/26/03

CONSOL Energy Inc.

   United States   

CE CONSOL ENERGY

(with design)

   2,756,595    8/26/03

CONSOL Energy Inc.

   United States    CE (design)    75,924,233    2/22/00

 

--------------------------------------------------------------------------------

III. TRADE NAMES

 

None.

 

--------------------------------------------------------------------------------

IV. COPYRIGHTS

 

None.

 

--------------------------------------------------------------------------------

V. INTELLECTUAL PROPERTY AGREEMENTS

 

GRANTOR

--------------------------------------------------------------------------------

  

INTELLECTUAL PROPERTY AGREEMENTS

(INCLUDING LICENSES)

--------------------------------------------------------------------------------

CONSOL Energy Inc.

  

License agreement with Oracle Corporation for database software

CONSOL Energy Inc.

  

License agreement with SAP Corporation

CONSOL Energy Inc.

  

License agreement with Microsoft Corporation

 

--------------------------------------------------------------------------------

EXHIBIT 1.1(P)(2)

FORM OF

 

PLEDGE AGREEMENT

 

THIS PLEDGE AGREEMENT, dated as of June 30, 2004 (as amended, restated,
supplemented or modified from time to time, the “Agreement”), is given, made and
entered into by each of the undersigned pledgors listed on the signature pages
hereto and each of the other persons and entities that become bound hereby from
time to time by joinder, assumption, or otherwise (each, a “Pledgor” and
collectively, the “Pledgors”), and Wilmington Trust Company, a Delaware banking
corporation, not in its individual capacity but solely as collateral trustee
(the “Collateral Trustee”) for the equal and ratable benefit of the Secured
Parties (as defined below) pursuant to the Collateral Trust Agreement (as
defined below).

 

WHEREAS, pursuant to that certain Credit Agreement (as from time to time
restated, amended, restated, supplemented or modified from time to time, the
“Credit Agreement”) dated as of June 30, 2004, by and among CONSOL Energy Inc.
(the “Borrower”), each of the Guarantors party thereto, the Lenders party
thereto (the “Lenders”), LaSalle Bank National Association, Société Générale,
New York Branch and SunTrust Bank, each in its capacity as a co-documentation
agent, and Citicorp North America, Inc. and PNC Bank, National Association, as
Co-Administrative Agents (the “Co-Administrative Agents”), the Co-Administrative
Agents and the Lenders have agreed to provide certain loans and other financial
accommodations to the Borrower and its Subsidiaries; and

 

WHEREAS, pursuant to the Credit Agreement and that certain Issuing and Paying
Agency Agreement, dated December 31, 1991, among the Borrower, certain of its
Subsidiaries (as defined in the Credit Agreement) and The Bank of Nova Scotia
Trust Company of New York as successor-in-interest to Morgan Guaranty Trust
Company of New York, as paying agent (as supplemented, modified, amended or
restated from time to time, the “Issuing and Paying Agency Agreement”), and that
certain Indenture, dated March 7, 2002, among the Borrower, certain of its
Subsidiaries and The Bank of Nova Scotia Trust Company of New York, as trustee
(as supplemented, modified, amended or restated from time to time, the
“Indenture”), the Collateral Trustee has entered into that certain Collateral
Trust Agreement, dated of even date herewith (as supplemented, modified, amended
or restated from time to time, the “Collateral Trust Agreement”) with the
Borrower, David A. Vanaskey, as individual trustee, and the Designated
Subsidiaries (as defined therein) to accept the grant of a security interest
under this Agreement as security for the Secured Obligations (as defined below)
for the equal and ratable benefit of the Secured Parties.

 

WHEREAS, pursuant to and in consideration of the Credit Agreement, certain of
the issued and outstanding capital stock, shares, securities, member interests,
partnership interests and other ownership interests of each of the Companies is
to be pledged to the Collateral Trustee in accordance herewith; and

 

--------------------------------------------------------------------------------

WHEREAS, each Pledgor owns the outstanding capital stock, shares, securities,
member interests, partnership interests and other ownership interests of the
Companies as set forth on Schedule A hereto.

 

NOW, THEREFORE, intending to be legally bound hereby, the parties hereto hereby
agree as follows:

 

1. Defined Terms.

 

(a) Except as otherwise expressly provided herein, capitalized terms used in
this Agreement shall have the respective meanings assigned to them in the Credit
Agreement. Where applicable and except as otherwise expressly provided herein,
terms used herein (whether or not capitalized) shall have the respective
meanings assigned to them in the Uniform Commercial Code as enacted in
Pennsylvania as amended from time to time (the “Code”).

 

(b) “Pledged Collateral” shall mean and include all of each Pledgor’s present
and future right, title and interest in and to the following: (i) all capital
stock, shares, member interests, partnership interests and other ownership
interests in the corporations, limited liability companies, partnerships or
other entities (each a “Company” and collectively the “Companies”) listed on
Schedule A attached hereto and made a part hereof (as updated pursuant to
Section 5(g) hereof); (ii) together with all dividends or distributions paid or
payable on any of the foregoing, and all books and records (whether paper,
electronic or any other medium) pertaining to the foregoing, including, without
limitation, all stock record and transfer books; and (iii) all cash and non-cash
proceeds (including, without limitation, insurance proceeds) of any of the
foregoing property, all products thereof, and all additions and accessions
thereto, substitutions therefor and replacements thereof; provided, however,
that pursuant to Section 8.1.16 of the Credit Agreement, the Pledged Collateral
shall not include any stock or assets acquired in a Permitted Acquisition and to
the extent and only so long as encumbered by a Lien permitted by clause (xiii)
or (xv) of the definition of Permitted Lien or any ownership interest in an
Excluded Subsidiary (other than any wholly-owned Foreign Company) or any of the
Pledged Collateral described in clauses (ii) and (iii) related to the foregoing.

 

(c) “Company” and “Companies” shall mean one or more of the entities issuing any
of the Pledged Collateral which is or should be (in accordance with Section 5(g)
hereof) described on Schedule A hereto.

 

(d) “Debt Instruments” shall have the meaning set forth in the Collateral Trust
Agreement.

 

(e) “Event of Default” shall mean an Actionable Default (as defined in the
Collateral Trust Agreement).

 

(f) “Foreign Company” shall mean one or more of the entities issuing any of the
Pledged Collateral which is not organized under the laws of any state of the
United States of America, which is, or should be, described on Schedule A.

 

- 2 -

--------------------------------------------------------------------------------

(g) “Secured Obligations” shall mean the Secured Debt (as defined in the
Collateral Trust Agreement).

 

(h) “Secured Parties” shall mean collectively, the Collateral Trustees (as
defined in the Collateral Trust Agreement), the Co-Administrative Agents, the
Paying Agent, the Lenders, The Bank of Nova Scotia Trust Company of New York or
any successor thereto, as paying agent under the Issuing and Paying Agency
Agreement and trustee under the Indenture, and any other holders from time to
time of the Secured Obligations and “Secured Party” shall mean each of them
individually.

 

2. Grant of Security Interests.

 

(a) To secure on a first priority perfected basis the payment and performance of
all Secured Obligations in full, each Pledgor hereby grants to the Collateral
Trustee a continuing first priority security interest under the Code in and
hereby pledges to Collateral Trustee, in each case for the equal and ratable
benefit of the Secured Parties, all of such Pledgor’s now existing and hereafter
acquired or arising right, title and interest in, to, and under the Pledged
Collateral whether now or hereafter existing and wherever located, subject in
all cases to Permitted Liens contemplated by clauses (vi), (x), (xi), (xiii),
(xv), (xvi) and (xix) of the definition of Permitted Liens and inchoate Liens
that do not have priority over the Liens granted under the Loan Documents
(collectively, the “Permitted Pledged Collateral Liens”).

 

(b) Notwithstanding anything to the contrary contained in this Agreement, the
Pledged Collateral with respect to any one Foreign Company shall not exceed
sixty-five percent (65%) of the total combined voting power of all classes of
capital stock, shares, securities, member interests, partnership interests and
other ownership interests entitled to vote of such Foreign Company and this
Agreement shall not apply to any such stock, shares, securities, member
interests, partnership interests or ownership interests which are in excess of
such sixty five percent (65%) limitation. To the extent the Collateral Trustee
receives more than sixty five percent (65%) of the total combined voting power
of all classes of capital stock, shares, securities, member interests,
partnership interests and other ownership interests entitle to vote of any
Foreign Company, the Collateral Trustee shall return such excess stock, shares,
securities, member interests, partnership interests and other ownership
interests upon the request of a Pledgor.

 

3. Further Assurances.

 

Prior to or concurrently with the execution of this Agreement, and thereafter at
any time and from time to time upon reasonable request of the Collateral
Trustee, each Pledgor shall execute and deliver to the Collateral Trustee all
financing statements, continuation financing statements, assignments,
certificates and documents of title, affidavits, reports, notices, schedules of
account, letters of authority, further pledges, powers of attorney and all other
documents (collectively, the “Security Documents”) which the Collateral Trustee
may reasonably request, in form reasonably satisfactory to the Collateral
Trustee, and take such other action which the Collateral Trustee may reasonably
request, to perfect and continue perfected and to create and maintain the first
priority status of the Collateral Trustee’s security interest in the Pledged

 

- 3 -

--------------------------------------------------------------------------------

Collateral and to fully consummate the transactions contemplated under this
Agreement, subject only to Permitted Pledged Collateral Liens. Each Pledgor
hereby irrevocably makes, constitutes and appoints the Collateral Trustee (and
any of the Collateral Trustee’s officers or employees or agents designated by
the Collateral Trustee) as such Pledgor’s true and lawful attorney with power to
sign the name of such Pledgor on all or any of the Security Documents which the
Collateral Trustee determines must be executed, filed, recorded or sent in order
to perfect or continue perfected the Collateral Trustee’s security interest in
the Pledged Collateral in any jurisdiction. Such power, being coupled with an
interest, is irrevocable until all of the Secured Obligations have been paid in
full, the Commitments have terminated and all Letters of Credit and Specified
Swap Agreements have expired.

 

4. Representations and Warranties.

 

Each Pledgor hereby jointly and severally represents and warrants to the
Collateral Trustee and the Secured Parties as follows:

 

(a) Such Pledgor, has and will continue to have (or, in the case of
after-acquired Pledged Collateral, at the time such Pledgor acquires rights in
such Pledged Collateral, will have and will continue to have), title to its
Pledged Collateral, free and clear of all Liens other than Permitted Pledged
Collateral Liens;

 

(b) The capital stock shares, securities, member interests, partnership
interests and other ownership interests constituting the Pledged Collateral have
been duly authorized and validly issued to such Pledgor (as set forth on
Schedule A hereto), are fully paid and nonassessable and constitute the
following (i) one hundred percent (100%) of the issued and outstanding capital
stock, member interests and partnership interests of each of the Companies which
are not Foreign Companies, and (ii) sixty five percent (65%) of the issued and
outstanding capital stock, shares, securities, member interests and partnership
interests of each of the Foreign Companies;

 

(c) The security interests in the Pledged Collateral granted hereunder are
valid, perfected and of first priority, subject to the Lien of no other Person
other than Permitted Pledged Collateral Liens;

 

(d) There are no restrictions upon the transfer of the Pledged Collateral and
such Pledgor has the power and authority and right to transfer the Pledged
Collateral owned by such Pledgor free of any encumbrances, subject to Permitted
Pledged Collateral Liens, and without obtaining the consent of any other Person;

 

(e) Such Pledgor has all necessary power to execute, deliver and perform this
Agreement;

 

(f) Such Pledgor’s exact legal name is as set forth on the signature page
hereto;

 

(g) The state of incorporation, formation or organization as applicable, of such
Pledgor is as set forth on Schedule A hereto;

 

- 4 -

--------------------------------------------------------------------------------

(h) Such Pledgor’s chief executive office is as set forth on the signature page
hereto; and

 

(i) All rights of such Pledgor in connection with its ownership of each of the
Companies pledged by such Pledgor hereunder are either (i) evidenced and
governed solely by the stock certificates, instruments or other documents
evidencing ownership and organizational documents of each of the Companies or
(ii) uncertificated securities with respect to which such Pledgor has caused the
issuer thereof either (A) to note or register the security interest of the
Collateral Trustee in the appropriate company records or (B) to agree in an
authenticated record with such Pledgor and the Collateral Trustee that, upon the
occurrence and during the continuation of an Event of Default, such issuer will
comply with instructions with respect to such security originated by the
Collateral Trustee without further consent of such Pledgor, including without
limitation, the Collateral Trustee’s instructions with respect to the assignment
or other transfer of such securities; if such Pledgor is an issuer of such
securities, such Pledgor confirms that it has received notice of such security
interest;

 

(j) No shareholder or other similar agreements, other than organizational
documents, are applicable to any of the Pledged Collateral and no organizational
document of any Company contains any restrictions on the rights of shareholders,
members or partners other than those that normally would apply to a company
organized under the laws of the jurisdiction of organization of each of the
Companies.

 

5. General Covenants.

 

Each Pledgor hereby covenants and agrees as follows:

 

(a) Such Pledgor shall do all reasonable acts that may be necessary and
appropriate to maintain, preserve and protect the Pledged Collateral and the
Collateral Trustee’s interest therein subject to Permitted Pledged Collateral
Liens; such Pledgor shall be responsible for the risk of loss of, damage to, or
destruction of the Pledged Collateral owned by such Pledgor, unless such loss is
the result of the gross negligence or willful misconduct of the Collateral
Trustee.

 

(b) [Intentionally Deleted]

 

(c) Such Pledgor shall, and shall cause each of the Companies to, keep separate,
accurate and complete records of the Pledged Collateral, disclosing the
Collateral Trustee’s security interest hereunder;

 

(d) Such Pledgor shall comply with all Laws applicable to the Pledged Collateral
unless any noncompliance would not individually or in the aggregate materially
impair the use or value of the Pledged Collateral or the Collateral Trustee’s
rights hereunder;

 

(e) If and to the full extent required under the terms of any contract,
agreement, document or instrument related to any of the Companies or their
respective shareholders, members, partners or other equity owners, such Pledgor
has heretofore and hereby reaffirms and ratifies its consent and approval to,
and all necessary waivers with respect to, the pledge of the Pledged Collateral
by any Pledgor under the terms of this Agreement and the exercise by the

 

- 5 -

--------------------------------------------------------------------------------

Collateral Trustee of any and all rights and remedies contemplated hereby and
such Pledgor hereby waives any prior notice with respect to such consent and
approval.

 

(f) Such Pledgor shall permit the Collateral Trustee, its officers, employees
and agents at reasonable times to inspect all books and records related to the
Pledged Collateral, provided that prior to an Event of Default, the same is done
with reasonable advance notice during normal business hours and in accordance
with such Pledgor’s standard safety, visit and inspection procedures and no such
visit or inspection shall interfere with such Pledgor’s normal business
operation;

 

(g) Subject to Section 2(b) hereof, to the extent, following the date hereof,
such Pledgor acquires capital stock, shares, member interests, partnership
interests and other ownership interests of any of the Companies or any
Subsidiary of the Borrower acquired or formed after the date hereof, other than
Excluded Subsidiaries (except for wholly-owned Foreign Companies), or any of the
rights, property or securities, shares, capital stock, member interests,
partnership interests or any other ownership interests described in the
definition of Pledged Collateral with respect to any of the Companies or any
Subsidiary of the Borrower acquired or formed after the date hereof, other than
Excluded Subsidiaries (except for wholly-owned Foreign Companies), such
ownership interests shall be subject to the terms hereof and, upon such
acquisition or formation, shall be deemed to be hereby pledged to the Collateral
Trustee; and, such Pledgor thereupon shall deliver an updated Schedule A hereto
to the Collateral Trustee;

 

(h) Except as permitted by the Credit Agreement, during the term of this
Agreement, such Pledgor shall not sell, assign, replace, retire, transfer or
otherwise dispose of its Pledged Collateral;

 

(i) Such Pledgor will not change its state of incorporation, formation or
organization, as applicable without providing thirty (30) days prior written
notice to the Collateral Trustee;

 

(j) Such Pledgor will not change its name without providing thirty (30) days
prior written notice to the Collateral Trustee;

 

(k) [Intentionally Deleted]

 

(l) All certificates or instruments representing or evidencing Pledged
Collateral shall be delivered to and held by or on behalf of the Collateral
Trustee pursuant hereto and shall be in suitable form for transfer by delivery,
or shall be accompanied by duly executed instruments of transfer or assignment
in blank, all in form and substance reasonably satisfactory to the Collateral
Trustee;

 

(m) With respect to any Pledged Collateral in which any Pledgor has any right,
title or interest and that constitutes an uncertificated security, such Pledgor
will cause the issuer thereof either (i) to note or register the security
interest created hereby in the appropriate company records or (ii) to agree in
an authenticated record with such Pledgor and the Collateral Trustee that upon
the occurrence and during the continuance of an Event of Default such issuer
will comply with instructions with respect to such security originated by the
Collateral Trustee

 

- 6 -

--------------------------------------------------------------------------------

without further consent of such Pledgor, including without limitation, the
Collateral Trustee’s instructions with respect to the assignment or other
transfer of such securities, such authenticated record to be in form and
substance reasonably satisfactory to the Collateral Trustee and such Pledgor.
With respect to any Pledged Collateral in which any Pledgor has any right, title
or interest and that is not an uncertificated security, upon the request of the
Collateral Trustee, such Pledgor will notify each such issuer of such Pledged
Collateral that such Pledged Collateral is subject to the security interest
granted hereunder;

 

(n) With respect to any Pledged Collateral in which any Pledgor has any right,
title or interest and that constitutes a security entitlement in which the
Collateral Trustee is not the entitlement holder, such Pledgor will use its
commercial good faith efforts to cause the securities intermediary with respect
to such security entitlement to either (i) to identify in its records the
Collateral Trustee as the entitlement holder of such security entitlement
against such securities intermediary or (ii) agree in an authenticated record
with such Pledgor and the Collateral Trustee that, upon the occurrence and
during the continuance of an Event of Default, such securities intermediary will
comply with entitlement orders (that is, notifications communicated to such
securities intermediary directing transfer or redemption of the financial asset
to which such Pledgor has a security entitlement) originated by the Collateral
Trustee without further consent of such Pledgor, such authenticated record to be
in substantially the form of Exhibit A hereto or otherwise in form and substance
reasonably satisfactory to the Collateral Agent (such agreement being a
“Securities Account Control Agreement”);

 

(o) No Pledgor will change or add any securities intermediary that maintains any
securities account in which any of the Pledged Collateral is credited or
carried, or change or add any such securities account without first complying
with the provisions of Section 2(l) through (n) in order to perfect the security
interest granted hereunder in such Pledged Collateral; and

 

(p) In the event any Pledged Collateral is maintained with any Person that has
not entered into a Securities Account Control Agreement with respect thereto or
otherwise subject to the “control” of the Collateral Trustee within the meaning
of Section 9-106 of the Code within 15 Business Days after the date hereof, the
average daily account balance in each such account shall not exceed $5,000,000.

 

6. Other Rights With Respect to Pledged Collateral.

 

In addition to the other rights with respect to the Pledged Collateral granted
to the Collateral Trustee hereunder, at any time and from time to time, after
and during the continuation of an Event of Default, the Collateral Trustee, at
its option and at the expense of the Pledgors, may (a) transfer into its own
name, or into the name of its nominee, all or any part of the Pledged
Collateral, thereafter receiving all dividends, income or other distributions
upon the Pledged Collateral; (b) take control of and manage all or any of the
Pledged Collateral; (c) apply to the payment of any of the Secured Obligations,
whether any be due and payable or not, any moneys, including cash dividends and
income from any Pledged Collateral, now or hereafter in the hands of the
Collateral Trustee or any Secured Party, on deposit or otherwise, belonging to
any Pledgor, as the Collateral Trustee in its sole discretion shall determine;
and (d) do anything which any Pledgor is required but fails to do hereunder.

 

- 7 -

--------------------------------------------------------------------------------

7. Additional Remedies Upon Event of Default.

 

Upon the occurrence of any Event of Default and while such Event of Default
shall be continuing, the Collateral Trustee shall have, in addition to all
rights and remedies of a secured party under the Code or other applicable Law,
and in addition to its rights under Section 6 above and under the other Loan
Documents to which it is a party, the following rights and remedies:

 

(a) The Collateral Trustee may, after ten (10) days’ advance notice to a
Pledgor, sell, assign, give an option or options to purchase or otherwise
dispose of such Pledgor’s Pledged Collateral or any part thereof at public or
private sale, at any of the Collateral Trustee’s offices or elsewhere, for cash,
on credit or for future delivery, and upon such other terms as the Collateral
Trustee may deem commercially reasonable. Each Pledgor agrees that ten (10)
days’ advance notice of the time and place of any public sale or the time after
which any private sale is to be made shall constitute reasonable notification.
The Collateral Trustee shall not be obligated to make any sale of Pledged
Collateral regardless of notice of sale having been given. The Collateral
Trustee may adjourn any public or private sale from time to time by announcement
at the time and place fixed therefor, and such sale may, without further notice,
be made at the time and place to which it was so adjourned. Each Pledgor
recognizes that the Collateral Trustee may be compelled to resort to one or more
private sales of the Pledged Collateral to a restricted group of purchasers who
will be obliged to agree, among other things, to acquire such securities,
shares, capital stock, member interests, partnership interests or ownership
interests for their own account for investment and not with a view to the
distribution or resale thereof.

 

(b) The proceeds of any collection, sale or other disposition of the Pledged
Collateral, or any part thereof, shall be applied as set forth in the Collateral
Trust Agreement.

 

8. Collateral Trustee’s Duties.

 

The powers conferred on the Collateral Trustee hereunder are solely to protect
its interest in the Pledged Collateral and shall not impose any duty upon it to
exercise any such powers. Except for the safe custody of any Pledged Collateral
in its possession and the accounting for moneys actually received by it
hereunder, the Collateral Trustee shall have no duty as to any Pledged
Collateral or as to the taking of any necessary steps to preserve rights against
prior parties or any other rights pertaining to any Pledged Collateral.

 

9. Additional Pledgors.

 

It is anticipated that additional persons will from time to time become
Subsidiaries of the Borrower or a Guarantor, each of whom will be required to
join this Pledge Agreement to the extent required by the Credit Agreement. It is
acknowledged and agreed that new Subsidiaries of the Borrower or of a Guarantor
will become Pledgors hereunder and will be bound hereby simply by executing and
delivering to Collateral Trustee a Guarantor Joinder in the form of Exhibit
1.1(G)(1) to the Credit Agreement. In addition, a new Schedule A hereto shall be
provided to Collateral Trustee showing the pledge of the ownership interest in
such new Subsidiary and any ownership interests that such new Subsidiary owns in
any other Person.

 

- 8 -

--------------------------------------------------------------------------------

10. No Waiver; Cumulative Remedies.

 

No failure to exercise, and no delay in exercising, on the part of the
Collateral Trustee, any right, power or privilege hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any right, power or
privilege hereunder preclude any further exercise thereof or the exercise of any
other right, power or privilege. The remedies herein provided are cumulative and
not exclusive of any remedies provided under the Debt Instruments or by Law.
Each Pledgor waives any right to require the Collateral Trustee to proceed
against any other Person or to exhaust any of the Pledged Collateral or other
security for the Secured Obligations or to pursue any remedy in the Collateral
Trustee’s power.

 

11. No Discharge Until Payment of the Secured Obligations.

 

The pledge, security interests, and other Liens and the obligations of each
Pledgor hereunder shall not be discharged or impaired or otherwise diminished by
any failure, default, omission, or delay, willful or otherwise, by Collateral
Trustee, or any other obligor on any of the Secured Obligations, or by any other
act or thing or omission or delay to do any other act or thing which may or
might in any manner or to any extent vary the risk of such Pledgor or which
would otherwise operate as a discharge of such Pledgor as a matter of law or
equity except for, and to the extent of, payment and performance of the Secured
Obligations. Without limiting the generality of the foregoing, each Pledgor
hereby consents to, and the pledge, security interests, and other Liens given by
such Pledgor hereunder shall not be diminished, terminated, or otherwise
similarly affected by any of the following at any time and from time to time:

 

(a) Any lack of genuineness, legality, validity, enforceability, or allowability
(in a bankruptcy, insolvency, reorganization or similar proceeding, or
otherwise), or any avoidance or subordination, in whole or in part, of any Debt
Instrument or any of the Secured Obligations and regardless of any law,
regulation, or order now or hereafter in effect in any jurisdiction affecting
any of the Secured Obligations, any of the terms of the Debt Instruments, or any
rights of the Collateral Trustee or any other Person with respect thereto;

 

(b) Any increase, decrease, or change in the amount, nature, type or purpose of
any of the Secured Obligations (whether or not contemplated by the Debt
Instruments as presently constituted); any change in the time, manner, method,
or place of payment or performance of, or in any other term of, any of the
Secured Obligations; any execution or delivery of any additional Debt
Instruments, or documents evidencing or related to the Secured Obligations; or
any amendment, modification or supplement to, or refinancing or refunding of,
any Debt Instrument or any of the Secured Obligations;

 

(c) Any failure to assert any breach of or default under any Debt Instrument or
any of the Secured Obligations; any extensions of credit in excess of the amount
committed under or contemplated by any Debt Instrument, or in circumstances in
which any condition to such extensions of credit has not been satisfied; any
other exercise or non-exercise, or any other failure, omission, breach, default,
delay, or wrongful action in connection with any exercise or non-exercise, of
any right or remedy against such Pledgor or any other Person under or in
connection with any Debt Instrument or any of the Secured Obligations; any
refusal of payment or

 

- 9 -

--------------------------------------------------------------------------------

performance of any of the Secured Obligations, whether or not with any
reservation of rights against any Pledgor; or any application of collections
(including collections resulting from realization upon any direct or indirect
security for the Secured Obligations) to other obligations, if any, not entitled
to the benefits of this Agreement, in preference to Secured Obligations or, if
any collections are applied to Secured Obligations, any application to
particular Secured Obligations;

 

(d) Any taking, exchange, amendment, modification, supplement, termination,
subordination, release, loss, or impairment of, or any failure to protect,
perfect, or preserve the value of, or any enforcement of, realization upon, or
exercise of rights or remedies under or in connection with, or any failure,
omission, breach, default, delay, or wrongful action by the Collateral Trustee
or any other Person in connection with the enforcement of, realization upon, or
exercise of rights or remedies under or in connection with, or, any other action
or inaction by Collateral Trustee or any other Person in respect of, any direct
or indirect security for any of the Secured Obligations (including the Pledged
Collateral). As used in this Agreement, “direct or indirect security” for the
Secured Obligations, and similar phrases, includes any collateral security,
guaranty, suretyship, letter of credit, capital maintenance agreement, put
option, subordination agreement, or other right or arrangement of any nature
providing direct or indirect assurance of payment or performance of any of the
Secured Obligations, made by or on behalf of any Person;

 

(e) Any merger, consolidation, liquidation, dissolution, winding-up, charter
revocation, or forfeiture, or other change in, restructuring or termination of
the corporate structure or existence of, any Pledgor or the Borrower or any
other Person; any bankruptcy, insolvency, reorganization or similar proceeding
with respect to any Pledgor or the Borrower or any other Person; or any action
taken or election (including any election under Section 1111(b)(2) of the United
States Bankruptcy Code or any comparable law of any jurisdiction) made by the
Collateral Trustee or any Pledgor or the Borrower or by any other Person in
connection with any such proceeding;

 

(f) Any defense, setoff, or counterclaim which may at any time be available to
or be asserted by any Pledgor or the Borrower or any other Person with respect
to any Debt Instrument or any of the Secured Obligations, other than, and to the
extent of, payment and performance of the Secured Obligations; or any discharge
by operation of law or release of any Pledgor or the Borrower or any other
Person from the performance or observance of any Debt Instrument or any of the
Secured Obligations; and

 

(g) Any other event or circumstance, whether similar or dissimilar to the
foregoing, and whether known or unknown, which might otherwise constitute a
defense available to, or limit the liability of a guarantor or a surety,
including any Pledgor, excepting only full, strict, and indefeasible payment and
performance of the Secured Obligations in full.

 

12. [Intentionally Deleted]

 

13. Waivers.

 

Each Pledgor hereby waives any and all defenses which any Pledgor may now or
hereafter have based on principles of suretyship, impairment of collateral, or
the like, other than, and to the

 

- 10 -

--------------------------------------------------------------------------------

extent of, the defense of prior payment of the Secured Obligations, and each
Pledgor hereby waives any defense to or limitation on its obligations under this
Agreement arising out of or based on any event or circumstance referred to in
Section 11 hereof, other than, and to the extent of, the defense of prior
payment of the Secured Obligations. Without limiting the generality of the
foregoing and to the fullest extent permitted by applicable law, each Pledgor
hereby further waives each of the following:

 

(a) Except as may be expressly provided in the Credit Agreement or other Debt
Instruments, all notices, disclosures and demands of any nature which otherwise
might be required from time to time to preserve intact any rights against such
Pledgor, including the following: any notice of any event or circumstance
described in the immediately preceding section hereof; any notice required by
any law, regulation or order now or hereafter in effect in any jurisdiction; any
notice of nonpayment, nonperformance, dishonor, or protest under any Debt
Instrument or any of the Secured Obligations; any notice of the incurrence of
any Secured Obligations; any notice of any default or any failure on the part of
such Pledgor or the Borrower or any other Person to comply with any Debt
Instrument or any of the Secured Obligations or any requirement pertaining to
any direct or indirect security for any of the Secured Obligations; and any
notice or other information pertaining to the business, operations, condition
(financial or otherwise), or prospects of the Borrower or any other Person;

 

(b) Any right to any marshalling of assets, to the filing of any claim against
such Pledgor or the Borrower or any other Person in the event of any bankruptcy,
insolvency, reorganization, or similar proceeding, or to the exercise against
such Pledgor or the Borrower, or any other Person of any other right or remedy
under or in connection with any Debt Instrument or any of the Secured
Obligations or any direct or indirect security for any of the Secured
Obligations; any requirement of promptness or diligence on the part of the
Collateral Trustee or any other Person; any requirement to exhaust any remedies
under or in connection with, or to mitigate the damages resulting from default
under, any Debt Instrument or any of the Secured Obligations or any direct or
indirect security for any of the Secured Obligations; any benefit of any statute
of limitations; and any requirement of acceptance of this Agreement or any other
Debt Instrument, and any requirement that any Pledgor receive notice of any such
acceptance; and

 

(c) Any defense or other right arising by reason of any Law now or hereafter in
effect in any jurisdiction pertaining to election of remedies (including
anti-deficiency laws, “one action” laws, or the like), or by reason of any
election of remedies or other action or inaction by the Collateral Trustee
(including commencement or completion of any judicial proceeding or nonjudicial
sale or other action in respect of collateral security for any of the Secured
Obligations), which results in denial or impairment of the right of the
Collateral Trustee to seek a deficiency against the Borrower or any other Person
or which otherwise discharges or impairs any of the Secured Obligations.

 

14. Assignment.

 

(a) This Agreement shall be binding upon and inure to the benefit of the
Collateral Trustee, the Secured Parties and their respective successors and
assigns, and each Pledgor and each of its respective successors and assigns,
except that no Pledgor may assign or transfer such

 

- 11 -

--------------------------------------------------------------------------------

Pledgor’s obligations hereunder or any interest herein other than assignments
and transfers permitted by the Credit Agreement.

 

(b) The Collateral Trustee may resign and a successor Collateral Trustee may be
appointed in the manner provided in the Collateral Trust Agreement. Upon the
acceptance of any appointment as a collateral trustee by a successor collateral
trustee, that successor collateral trustee shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring
collateral trustee, as secured party under this Agreement and the retiring
collateral trustee shall thereupon be discharged from its duties and obligations
under this Agreement. After any retiring collateral trustee’s resignation, the
provisions of this Agreement shall inure to its benefit as to any actions taken
or omitted to be taken by it under this Agreement while it was Collateral
Trustee.

 

15. Severability.

 

The provisions of this Agreement are intended to be severable. If any provision
of this Agreement shall be held invalid or unenforceable in whole or in part in
any jurisdiction, such provision shall, as to such jurisdiction, be ineffective
to the extent of such invalidity or unenforceability without in any manner
affecting the validity or enforceability thereof in any other jurisdiction or
the remaining provisions hereof in any jurisdiction.

 

16. Governing Law.

 

This Agreement shall be deemed to be a contract under the laws of the
Commonwealth of Pennsylvania and for all purposes shall be governed by and
construed in accordance with the laws of said Commonwealth without regard to its
conflict of laws principles, except to the extent that the validity or
perfection of the Lien and the security interest hereunder, or remedies
hereunder, in respect of any particular Pledged Collateral are governed by the
laws of a jurisdiction other than the Commonwealth of Pennsylvania.

 

17. Notices.

 

All notices, requests, demands, directions and other communications
(collectively, “notices”) given to or made upon any party hereto under the
provisions of this Agreement shall be as set forth in Section 11.6 [Notices] of
the Credit Agreement in the case of the Pledgors and as set forth in Section 7.2
of the Collateral Trust Agreement in the case of the Collateral Trustee.

 

18. Specific Performance.

 

Each Pledgor acknowledges and agrees that, in addition to the other rights of
the Collateral Trustee hereunder and under the other Loan Documents to which it
is a party, because the Collateral Trustee’s remedies at law for failure of such
Pledgor to comply with the provisions hereof relating to the Collateral
Trustee’s rights (i) to inspect the books and records related to the Pledged
Collateral, (ii) to receive the various notifications such Pledgor is required
to deliver hereunder, (iii) to obtain copies of agreements and documents as
provided herein with respect to the Pledged Collateral, (iv) to enforce the
provisions hereof pursuant to which the such Pledgor has appointed the
Collateral Trustee its attorney-in-fact, and (v) to enforce the Collateral

 

- 12 -

--------------------------------------------------------------------------------

Trustee’s remedies hereunder, would be inadequate and that any such failure
would not be adequately compensable in damages, such Pledgor agrees that each
such provision hereof may be specifically enforced.

 

19. Voting Rights in Respect of the Pledged Collateral.

 

So long as no Event of Default shall occur and be continuing, each Pledgor may
exercise any and all voting and other consensual rights pertaining to the
Pledged Collateral or any part thereof for any purpose not inconsistent with the
terms of this Agreement or the other Debt Instruments. Without limiting the
generality of the foregoing and in addition thereto, the Pledgors shall not vote
to enable, or take any other action to permit, any of the Companies to issue any
stock, member interests, partnership interests or other equity securities,
member interests, partnership interests or other ownership interests of any
nature or to issue any other securities, shares, capital stock, member
interests, partnership interests or other ownership interests convertible into
or granting the right to purchase or exchange for any stock, member interests,
partnership interests or other equity securities, member interests, partnership
interests or other ownership interests of any nature of any such Company or to
enter into any agreement or undertaking restricting the right or ability of the
Pledgor or the Collateral Trustee to sell, assign or transfer any of the Pledged
Collateral.

 

20. Consent to Jurisdiction.

 

EACH PLEDGOR, EACH COMPANY AND THE COLLATERAL TRUSTEE HEREBY IRREVOCABLY
CONSENTS TO THE NONEXCLUSIVE JURISDICTION OF THE COURT OF COMMON PLEAS OF
ALLEGHENY COUNTY AND THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT
OF PENNSYLVANIA AND THE DELAWARE STATE AND UNITED STATES DISTRICT COURTS LOCATED
IN WILMINGTON, DELAWARE, AND WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS UPON
IT AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS BE MADE BY CERTIFIED OR
REGISTERED MAIL DIRECTED TO SUCH PLEDGOR, SUCH COMPANY OR THE COLLATERAL TRUSTEE
AT THE ADDRESSES PROVIDED FOR IN SECTION 17 HEREOF AND SERVICE SO MADE SHALL BE
DEEMED TO BE COMPLETED UPON ACTUAL RECEIPT THEREOF. EACH PLEDGOR, EACH COMPANY
AND THE COLLATERAL TRUSTEE WAIVES ANY OBJECTION TO JURISDICTION AND VENUE OF ANY
ACTION INSTITUTED AGAINST IT AS PROVIDED HEREIN AND AGREES NOT TO ASSERT ANY
DEFENSE BASED ON LACK OF JURISDICTION OR VENUE.

 

21. Waiver of Jury Trial.

 

EACH PLEDGOR, EACH COMPANY AND THE COLLATERAL TRUSTEE HEREBY WAIVES TRIAL BY
JURY IN ANY ACTION, SUIT, PROCEEDING OR COUNTERCLAIM OF ANY KIND ARISING OUT OF
OR RELATED TO THIS AGREEMENT OR THE PLEDGED COLLATERAL TO THE FULL EXTENT
PERMITTED BY LAW.

 

- 13 -

--------------------------------------------------------------------------------

22. Entire Agreement; Amendments.

 

This Agreement supersedes all prior understandings and agreements, whether
written or oral, between the parties hereto and thereto relating to the
transactions provided for herein.

 

23. Counterparts; Telecopy Signatures.

 

This Agreement may be executed by different parties hereto on any number of
separate counterparts, each of which, when so executed and delivered, shall be
an original, and all such counterparts shall together constitute one and the
same instrument. Delivery of an executed signature page by telecopy or
electronic signature delivery system (in either case in a form acceptable to the
Collateral Trustee) shall be effective as delivery of a manually executed
signature page to this Agreement.

 

24. Construction.

 

The rules of construction contained in Section 1.2 of the Credit Agreement apply
to this Agreement.

 

25. Termination.

 

This Agreement shall terminate upon the satisfaction of the conditions set forth
in, and in accordance with the provisions of, Section 6 of the Collateral Trust
Agreement. All or any portion of the Pledged Collateral shall be released upon
the satisfaction of the conditions set forth in, and in accordance with the
provisions of, Section 6 of the Collateral Trust Agreement.

 

26. The parties agree that in the event of any conflict between the provisions
of this Agreement and the provisions of the Collateral Trust Agreement, the
provisions of the Collateral Trust Agreement shall control. Notwithstanding any
provision in this Agreement to the contrary, the parties and signatories hereto
acknowledge and agree that any and all rights, powers, privileges, duties,
responsibilities, liabilities and/or obligations (including but not limited to
the right to grant or withhold consent and the right to act or refrain from
acting), whether discretionary or mandatory, are and shall be exercised by the
Collateral Trustee solely in accordance with the terms and conditions of the
Collateral Trust Agreement, at the direction of the Credit Facility Agent (as
defined in the Collateral Trust Agreement) or other entity specified in the
Collateral Trust Agreement as having the right to give direction to the
Collateral Trustee, and subject further to the rights of the Collateral Trustee
to require officers’ certificate(s), opinion(s) and advice from counsel,
accountants, appraisers and other third parties, advancement of expenses and/or
assurances of indemnity satisfactory to the Collateral Trustee.

 

- 14 -

--------------------------------------------------------------------------------

[SIGNATURE PAGE - PLEDGE AGREEMENT]

 

IN WITNESS WHEREOF, and intending to be legally bound, the parties hereto have
caused this Agreement to be duly executed as of the date first above written.

 

[PLEDGORS TO BE LISTED HERE AND CHIEF EXECUTIVE OFFICE ADDRESS] By:    

Name:

   

Title:

   

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE - PLEDGE AGREEMENT]

 

WILMINGTON TRUST COMPANY, as

Collateral Trustee

By:    

Name:

   

Title:

   

 

- 16 -

--------------------------------------------------------------------------------

SCHEDULE A

TO

PLEDGE AGREEMENT

 

Description of Pledged Collateral

 

A. CORPORATIONS

 

SUBSIDIARY PLEDGED

--------------------------------------------------------------------------------

  

PLEDGOR & PLEDGOR’S JURISDICTION OF FORMATION

--------------------------------------------------------------------------------

   PLEDGED
SHARES

--------------------------------------------------------------------------------

   TYPE AND
AMOUNT OF
OWNERSHIP
PLEDGED

--------------------------------------------------------------------------------

  Central Ohio Coal Company   

CONSOLIDATION COAL COMPANY

(Delaware)

   75,000    100 % Church Street Holdings, Inc.   

Rochester & Pittsburgh Coal Company

(Pennsylvania)

   100    100 % CNX Land Resources Inc.   

CONSOL Energy Inc

(Delaware)

   1,000    100 % CNX Marine Terminals Inc.   

CONSOLIDATION COAL COMPANY

(Delaware)

   1,000    100 % Consol Docks Inc.   

CONSOL Energy Inc.

(Delaware)

   1,000    100 % CONSOL Financial Inc.   

CONSOL Energy Inc.

(Delaware)

   1,000    100 % CONSOL Foreign Sales Corporation   

CONSOL Energy Inc.

(Delaware)

   650    65 % CONSOL Godefroid Europe S. A.   

CONSOLIDATION COAL COMPANY

(Delaware)

CNX Marine Terminals Inc.

(Delaware)

   97.5
73,352.5    65
65 %
% CONSOLIDATION COAL COMPANY   

CONSOL Energy Inc.

(Delaware)

   75,000    100 % CONSOL of Canada Inc.   

CONSOL Energy Inc.

(Delaware)

   7,000    100 % CONSOL of Kentucky Inc.   

CONSOL Energy Inc.

(Delaware)

   500    100 % Consol Pennsylvania Coal Company   

CONSOL Energy Inc.

(Delaware)

   1,000    100 % Consol Sales Company   

CONSOL Energy Inc.

(Delaware)

   1,000    100 % Eighty-Four Mining Company   

New Century Holdings, Inc.

(Pennsylvania)

   10    100 % Helvetia Coal Company   

Rochester & Pittsburgh Coal Company

(Pennsylvania)

   500    100 % IC Coal, Inc.   

CONSOL Energy Inc.

(Delaware)

   1,000    100 % ISLAND CREEK COAL COMPANY   

IC Coal, Inc.

(Delaware)

   100    100 % Jeffco Coal Company   

Rochester & Pittsburgh Coal Company

(Pennsylvania)

   500    100 %

 

--------------------------------------------------------------------------------

SUBSIDIARY PLEDGED

--------------------------------------------------------------------------------

  

PLEDGOR & PLEDGOR’S JURISDICTION OF FORMATION

--------------------------------------------------------------------------------

   PLEDGED
SHARES

--------------------------------------------------------------------------------

   TYPE AND
AMOUNT OF
OWNERSHIP
PLEDGED

--------------------------------------------------------------------------------

  Keystone Coal Mining Corporation   

Rochester & Pittsburgh Coal Company

(Pennsylvania)

   100    100 % Laurel Run Mining Company   

ISLAND CREEK COAL COMPANY

(Delaware)

   1,000    100 % Leatherwood, Inc.   

Rochester & Pittsburgh Coal Company

(Pennsylvania)

   100    100 % McELROY COAL COMPANY   

CONSOLIDATION COAL COMPANY

(Delaware)

   1,000    100 % MTB Inc.   

CONSOL Energy Inc.

(Delaware)

   1,000    100 % New Century Holdings, Inc.   

Rochester & Pittsburgh Coal Company

(Pennsylvania)

   100    100 % QUARTO MINING COMPANY   

CONSOLIDATION COAL COMPANY

(Delaware)

   500    100 % RESERVE COAL PROPERTIES COMPANY   

CONSOL Energy Inc.

(Delaware)

   1,000    100 % Rochester & Pittsburgh Coal Company   

CONSOLIDATION COAL COMPANY

(Delaware)

   1,000    100 % SOUTHERN OHIO COAL COMPANY   

CONSOLIDATION COAL COMPANY

(Delaware)

   5,000    100 % Terra Firma Company   

CNX Land Resources Inc.

(Delaware)

   1    100 % THE WHITE STAR COAL CO., INC.   

UNITED EASTERN COAL SALES CORPORATION

(Pennsylvania)

   10    100 % TWIN RIVERS TOWING COMPANY   

CONSOL Energy Inc.

(Delaware)

   1,000    100 % UNITED EASTERN COAL SALES CORPORATION   

Rochester & Pittsburgh Coal Company

(Pennsylvania)

   850    100 % Windsor Coal Company   

CONSOLIDATION COAL COMPANY

(Delaware)

   4,064    100 % WOLFPEN KNOB DEVELOPMENT COMPANY   

CONSOL Energy Inc.

(Delaware)

   1,000    100 %

 

--------------------------------------------------------------------------------

B. LIMITED LIABILITY COMPANIES

 

SUBSIDIARY PLEDGED

--------------------------------------------------------------------------------

  

PLEDGOR & PLEDGOR’S JURISDICTION OF FORMATION

--------------------------------------------------------------------------------

  

TYPE AND AMOUNT OF OWNERSHIP
PLEDGED

--------------------------------------------------------------------------------

CNX Gas Company LLC

   CONSOLIDATION COAL COMPANY (Delaware)   
100% of Pledgor’s Membership Interest

Greene Energy LLC

  

CONSOLIDATION COAL COMPANY (Delaware)

CONSOL Energy Inc. (Delaware)

  

100% of Pledgor’s Membership Interest

100% of Pledgor’s Membership Interest

Buchanan Generation, LLC

   CONSOL Energy Inc. (Delaware)    100% of Pledgor’s Membership Interest

 

C. PARTNERSHIPS

 

SUBSIDIARY PLEDGED

--------------------------------------------------------------------------------

  

PLEDGOR & PLEDGOR’S JURISDICTION OF
FORMATION

--------------------------------------------------------------------------------

  

TYPE AND AMOUNT OF OWNERSHIP
PLEDGED

--------------------------------------------------------------------------------

Cardinal States Gathering Company

  

CNX Gas Company LLC (Virginia)

CONSOLIDATION COAL COMPANY (Delaware)

  

100% of Pledgor’s Partnership Interest

100% of Pledgor’s Partnership Interest

Conrhein Coal Company

  

CONSOLIDATION COAL COMPANY (Delaware)

MTB Inc. (Delaware)

  

100% of Pledgor’s Partnership Interest

100% of Pledgor’s Partnership Interest

 

--------------------------------------------------------------------------------

EXHIBIT A

TO

PLEDGE AGREEMENT

 

Form of Securities Account Control Agreement

 

SECURITIES ACCOUNT CONTROL AGREEMENT (this “Agreement”) dated as of
                ,             , among (i)                 , a                 
(the “Grantor”), (ii) Wilmington Trust Company, a Delaware banking corporation,
not in its individual capacity, but solely as Collateral Trustee under that
certain Collateral Trust Agreement dated as of [June]             , 2004 (the
“Collateral Trust Agreement”), among Wilmington Trust Company, as corporate
trustee, David A. Vanaskey, as individual trustee, CONSOL Energy Inc. and
certain of its subsidiaries party thereto, as secured party for the equal and
ratable benefit of the Secured Parties (as such term is defined in the
Collateral Trust Agreement) (the “Collateral Trustee”), and (iii)             ,
a             , as securities intermediary (the “Securities Intermediary”).

 

PRELIMINARY STATEMENTS:

 

(1) The Grantor has granted the Collateral Trustee a security interest (the
“Security Interest”) in account no.              maintained by the Securities
Intermediary for the Grantor (the “Account”).

 

(2) Terms defined in Article 8 or 9 of the Uniform Commercial Code in effect in
the Commonwealth of Pennsylvania (“PA Uniform Commercial Code”) are used in this
Agreement as such terms are defined in such Article 8 or 9.

 

NOW, THEREFORE, in consideration of the premises and of the mutual agreements
contained herein, the parties hereto hereby agree as follows:

 

SECTION 1. The Account. The Grantor and Securities Intermediary represent and
warrant to, and agree with, the Grantor and the Collateral Trustee that:

 

(a) The Securities Intermediary maintains the Account for the Grantor, and all
property held by the Securities Intermediary for the account of the Grantor is,
and will continue to be, credited to the Account.

 

(b) The Account is a securities account. The Securities Intermediary is the
securities intermediary with respect to the property credited from time to time
to the Account. The Grantor is the entitlement holder with respect to the
property credited from time to time to the Account.

 

(c) The Commonwealth of Pennsylvania is, and will continue to be, the Securities
Intermediary’s jurisdiction of organization for purposes of Section 8-110(e) of
the UCC so long as the Security Interest shall remain in effect.

 

--------------------------------------------------------------------------------

(d) Exhibit A attached hereto is a statement of the property credited to the
Account on the most recent date practicable.

 

(e) The Grantor and Securities Intermediary do not know of any claim to or
interest in the Account or any property credited to the Account, except for
claims and interests of the parties referred to in this Agreement.

 

SECTION 2. Control by Collateral Trustee. Upon receipt of a Notice of Exclusive
Control (as defined below) and thereafter until receipt of a Notice of Release
(as defined below), the Securities Intermediary will comply with all
notifications it receives directing it to transfer or redeem any property in the
Account (each, and “Entitlement Order”) or other directions concerning the
Account (including, without limitation, directions to distribute to the
Collateral Trustee proceeds of any such transfer or redemption or interest or
dividends on property in the Account) originated by the Collateral Trustee
without further consent by the Grantor or any other person.

 

SECTION 3. Grantor’s Rights in Account.

 

(a) Until the Securities Intermediary receives a notice from the Collateral
Trustee certifying that an Event of Default (as defined in the security
documents between the Collateral Trustee and the Grantor) has occurred and is
continuing and stating that the Collateral Trustee will exercise exclusive
control over the Account (a “Notice of Exclusive Control” with respect to such
Account), the Securities Intermediary will comply with Entitlement Orders
originated by the Grantor without further consent by the Collateral Trustee.

 

(b) If the Securities Intermediary receives from the Collateral Trustee a Notice
of Exclusive Control, the Securities Intermediary, until it has received a
Notice of Release, will cease:

 

(i) complying with Entitlement Orders or other directions concerning the Account
originated by the Grantor and

 

(ii) distributing to the Grantor interest and dividends on property in the
Account.

 

(c) In the event a Notice of Exclusive Control is delivered by the Collateral
Trustee to the Securities Intermediary, and subsequently the Event of Default
triggering such notice is cured, the Collateral Trustee agrees promptly to send
a notice to the Securities Intermediary directing the Securities Intermediary to
comply with Entitlement Orders and other directions concerning each Account
originated by the Grantor (a “Notice of Release”) and, at such time, the Account
Holder will comply with Entitlement Orders as contemplated by clause (a).

 

SECTION 4. Priority of Collateral Trustee’s Security Interest.

 

(a) The Securities Intermediary subordinates in favor of the Collateral Trustee
any security interest, lien, or right of setoff it may have, now or in the
future, against the Account or property in the Account, except that the
Securities Intermediary will retain its prior lien on

 

--------------------------------------------------------------------------------

property in the Account to secure payment for property purchased for the Account
and normal commissions and fees for the Account.

 

(b) The Securities Intermediary will not agree with any Person not party to this
Agreement that the Securities Intermediary will comply with Entitlement Orders
originated by such Person.

 

SECTION 5. Statements, Confirmations, and Notices of Adverse Claims.

 

(a) The Securities Intermediary will send copies of all statements and
confirmations for the Account simultaneously to the Grantor and the Collateral
Trustee.

 

(b) When the Securities Intermediary knows of any claim or interest in the
Account or any property credited to the Account other than the claims and
interests of the parties referred to in this Agreement, the Securities
Intermediary will promptly notify the Collateral Trustee and the Grantor of such
claim or interest.

 

SECTION 6. The Securities Intermediary’s Responsibility.

 

(a) Except for permitting a withdrawal, delivery, or payment in violation of
Section 3, the Securities Intermediary will not be liable to the Collateral
Trustee for complying with Entitlement Orders or other directions concerning the
Account from the Grantor that are received by the Securities Intermediary before
the Securities Intermediary receives and has a reasonable opportunity to act on
a Notice of Exclusive Control.

 

(b) The Securities Intermediary will not be liable to the Grantor or the
Collateral Trustee for complying with a Notice of Exclusive Control or with an
Entitlement Order or other direction concerning the Account originated by the
Collateral Trustee, even if the Grantor notifies the Securities Intermediary
that the Collateral Trustee is not legally entitled to issue the Notice of
Exclusive Control or Entitlement Order or such other direction unless the
Securities Intermediary takes the action after it is served with an injunction,
restraining order, or other legal process enjoining it from doing so, issued by
a court of competent jurisdiction, and had a reasonable opportunity to act on
the injunction, restraining order or other legal process.

 

(c) This Agreement does not create any obligation of the Securities Intermediary
except for those expressly set forth in this Agreement and in Part 5 of Article
8 of the PA Uniform Commercial Code. In particular, the Securities Intermediary
need not investigate whether the Collateral Trustee is entitled under the
Collateral Trustee’s agreements with the Grantor to give an Entitlement Order or
other direction concerning the Account or a Notice of Exclusive Control. The
Securities Intermediary may rely on notices and communications it believes given
by the appropriate party.

 

SECTION 7. Indemnity. The Grantor will indemnify the Securities Intermediary,
its officers, directors, employees and agents against claims, liabilities and
expenses arising out of this Agreement (including, without limitation,
reasonable attorney’s fees and disbursements), except to the extent the claims,
liabilities or expenses are caused by the Securities Intermediary’s gross

 

--------------------------------------------------------------------------------

negligence of willful misconduct as found by a court of competent jurisdiction
in a final, non-appealable judgment.

 

SECTION 8. Termination; Survival.

 

(a) The Collateral Trustee may terminate this Agreement by notice to the
Securities Intermediary and the Grantor. If the Collateral Trustee notifies the
Securities Intermediary that the Security Interest has terminated, this
Agreement will immediately terminate.

 

(b) The Securities Intermediary may terminate this Agreement on 60 days’ prior
notice to the Collateral Trustee and the Grantor, provided that before such
termination the Securities Intermediary and the Grantor shall make arrangements
to transfer the property in the Account to another securities intermediary that
shall have executed, together with the Grantor, a control agreement in favor of
the Collateral Trustee in respect of such property in substantially the form of
this Agreement or otherwise in form and substance satisfactory to the Collateral
Trustee.

 

(c) This Agreement shall terminate upon the satisfaction of the conditions set
forth in, and in accordance with the provisions of, Section 6 of the Collateral
Trust Agreement. The Collateral Trustee agrees to promptly give notice to the
Securities Intermediary releasing all or any portion of the property (including,
without limitation, all or any portion of the funds and financial assets) held
by the Securities Intermediary for the account of Grantor upon the satisfaction
of the conditions set forth in, and in accordance with the provisions of,
Section 6 of the Collateral Trust Agreement.

 

(d) Sections 6 and 7 will survive termination of this Agreement.

 

SECTION 9. Governing Law. This Agreement shall be deemed to be a contract under
the laws of the Commonwealth of Pennsylvania and this Agreement and the Account
for all purposes shall be governed by and construed in accordance with the laws
of said Commonwealth without regard to its conflict of laws principles. The
Securities Intermediary and the Grantor may not change the law governing the
Account without the Collateral Trustee’s express prior written agreement.

 

SECTION 10. Entire Agreement. This Agreement supersedes all prior understandings
and agreements, whether written or oral, between the parties hereto relating to
the transactions provided for herein.

 

SECTION 11. Amendments. No amendment of, or waiver of a right under, this
Agreement will be binding unless it is in writing and signed by the party to be
charged.

 

SECTION 12. Financial Assets. The Securities Intermediary agrees with the
Collateral Trustee and the Grantor that, to the fullest extent permitted by
applicable law, all property credited from time to time to the Account will be
treated as financial assets under Article 8 of the PA Uniform Commercial Code.

 

SECTION 13. Notices. A notice or other communication to a party under this
Agreement will be in writing (except that Entitlement Orders may be given
orally), will be sent to the party’s

 

--------------------------------------------------------------------------------

address set forth under its name below or to such other address as the party may
notify the other parties. Any notice or other communication shall be effective:

 

(a) In the case of hand-delivery, when delivered;

 

(b) If given by mail, four days after such notice or other communication is
deposited with the United States Postal Service, with first-class postage
prepaid, return receipt requested;

 

(c) In the case of a facsimile transmission, when sent to the applicable party’s
facsimile machine’s telephone number if the party sending such notice or other
communication receives confirmation of the delivery thereof from its own
facsimile machine;

 

(d) In the case of electronic transmission, when actually received; and

 

(e) If given by any other means (including by overnight courier), when actually
received.

 

SECTION 14. Binding Effect. This Agreement shall be binding upon and inure to
the benefit of the Grantor, the Collateral Trustee and the Securities
Intermediary and their respective successors and assigns except that the Grantor
may not assign or transfer the Grantor’s obligations hereunder or any interest
herein other than assignments and transfers permitted by the Credit Agreement
dated as of             , 2004 among CONSOL Energy Inc., the Guarantors party
thereto, the Lenders party thereto, LaSalle Bank National Association, Société
Générale, New York Branch and SunTrust Bank, each in its capacity as a
co-documentation agent, and Citicorp North America, Inc. and PNC Bank, National
Association as co-administrative agents.

 

SECTION 15. Execution in Counterparts. This Agreement may be executed by
different parties hereto on any number of separate counterparts, each of which,
when so executed and delivered, shall be an original, and all such counterparts
shall together constitute one and the same instrument. Delivery of an executed
signature page by telecopy or electronic signature delivery system (in either
case in a form acceptable to the Collateral Trustee) shall be effective as
delivery of a manually executed signature page to this Agreement.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective officers thereunto duly authorized, as of the date first
above written.

 

[NAME OF GRANTOR]

By        

Title:

 

Address:

   

Facsimile:

   

Email:

   

 

WILMINGTON TRUST COMPANY, not in its individual capacity but solely as
Collateral Trustee By        

Name:

   

Title:

 

Address:

Wilmington Trust Company, as Collateral Trustee

Rodney Square North

1100 North Market Street

Wilmington, DE 19890

Attn:

 

CorporateTrust Administration

Telephone: (302) 636-6043

Facsimile: (302) 636-4143

Email:

   

 

[NAME OF SECURITIES INTERMEDIARY]

By        

Title:

 

Address:

   

Facsimile:

   

Email:

   

 

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EXHIBIT A

 

[Statements of the various Accounts showing the property credited to each
Account]

 

--------------------------------------------------------------------------------

EXHIBIT 1.1(R)

 

FORM OF

REVOLVING CREDIT NOTE

 

$                            

  Pittsburgh, Pennsylvania     June 30, 2004

 

FOR VALUE RECEIVED, the undersigned, CONSOL ENERGY, INC., a Delaware corporation
(herein called the “Borrower”), hereby promises to pay to the order of
                                                                  (the
“Lender”), the lesser of (i) the principal sum of
                                        
                                              (US$                    ), or (ii)
the aggregate unpaid principal balance of all Revolving Credit Loans made by the
Lender to the Borrower pursuant to the Credit Agreement, dated as of June 30,
2004, among the Borrower, the Guarantors now or hereafter party thereto, the
Lenders now or hereafter party thereto, LaSalle Bank National Association,
Société Générale, New York Branch and SunTrust Bank, each in its capacity as a
co-documentation agent, and Citibank North America, Inc. and PNC Bank, National
Association, in their capacity as co-administrative agents for the Lenders
(collectively, the “Co-Administrative Agents” and PNC Bank, National
Association, individually, as “Paying Agent”) (as amended, restated, modified or
supplemented from time to time, the “Credit Agreement”), payable by 1:00 p.m.,
Pittsburgh time, on the Revolving Expiration Date, together with interest on the
unpaid principal balance hereof from time to time outstanding from the date
hereof at the rate or rates per annum specified by the Borrower pursuant to, or
as otherwise provided in, the Credit Agreement.

 

Interest on the unpaid principal balance hereof from time to time outstanding
from the date hereof will be payable at the times provided for in the Credit
Agreement. Upon the occurrence and during the continuation of an Event of
Default, the Borrower shall pay interest on the entire principal amount of the
then outstanding Revolving Credit Loans evidenced by this Revolving Credit Note
and all other obligations due and payable to the Lender pursuant to the Credit
Agreement and the other Loan Documents at a rate per annum as set forth in
Section 4.3 of the Credit Agreement. Such interest rate will accrue before and
after any judgment has been entered.

 

Subject to the provisions of the Credit Agreement, payments of both principal
and interest shall be made without setoff, counterclaim, or other deduction of
any nature at the office of the Paying Agent located at One PNC Plaza, 249 Fifth
Avenue, Pittsburgh, Pennsylvania 15222, unless otherwise directed in writing by
the holder hereof, in lawful money of the United States of America in
immediately available funds.

 

This Note is one of the Revolving Credit Notes referred to in, and is entitled
to the benefits of, the Credit Agreement and other Loan Documents, including the
representations, warranties, covenants, conditions, security interests, and
Liens contained or granted therein. The Credit Agreement among other things
contains provisions for acceleration of the maturity hereof upon the happening
of certain stated events and also for prepayment, in certain circumstances, on

 

--------------------------------------------------------------------------------

account of principal hereof prior to maturity upon the terms and conditions
therein specified. The Borrower waives presentment, demand, notice, protest and
all other demands and notices in connection with the delivery, acceptance,
performance, default or enforcement of this Note and the Credit Agreement.

 

This Note shall bind the Borrower and its successors and assigns, and the
benefits hereof shall inure to the benefit of the Lender and its successors and
assigns. All references herein to the “Borrower” and the “Lender” shall be
deemed to apply to the Borrower and the Lender, respectively, and their
respective successors and assigns as permitted under the Credit Agreement.

 

This Note and any other documents delivered in connection herewith and the
rights and obligations of the parties hereto and thereto shall for all purposes
be governed by and construed and enforced in accordance with the internal laws
of the Commonwealth of Pennsylvania without giving effect to its conflicts of
law principles.

 

All capitalized terms used herein shall, unless otherwise defined herein, have
the same meanings given to such terms in the Credit Agreement.

 

[SIGNATURE PAGE FOLLOWS]

 

2

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[SIGNATURE PAGE 1 OF 1 TO REVOLVING CREDIT NOTE]

 

IN WITNESS WHEREOF, and intending to be legally bound hereby, the undersigned
has executed this Note by its duly authorized officer with the intention that it
constitute a sealed instrument.

 

CONSOL ENERGY, INC. By:       (SEAL)

Name:

   

Title:

   

 

--------------------------------------------------------------------------------

EXHIBIT 1.1(S)(1)

 

FORM OF

SECURITY AGREEMENT

 

THIS SECURITY AGREEMENT (the “Agreement”), dated as of June 30, 2004, is entered
into by and between CONSOL ENERGY INC., a Delaware corporation (the “Borrower”),
and EACH OF THE OTHER UNDERSIGNED PARTIES listed on the signature pages hereto
and each of the other persons and entities that become bound hereby from time to
time by joinder, assumption or otherwise (each of the Borrower and each of the
aforesaid entities is referred to herein as a “Debtor” and collectively the
“Debtors”), and WILMINGTON TRUST COMPANY, a Delaware banking corporation, not in
its individual capacity but solely as the collateral trustee (the “Collateral
Trustee”) for the equal and ratable benefit of the Secured Parties (as defined
below) pursuant to the Collateral Trust Agreement (as defined below).

 

WITNESSETH THAT:

 

WHEREAS, the Debtors are (or will be with respect to after-acquired property)
the legal and beneficial owners and the holders of the Collateral (as defined in
Section 1 hereof); and

 

WHEREAS, pursuant to that certain Credit Agreement (as it may hereafter from
time to time be restated, amended, modified or supplemented, the “Credit
Agreement”) of even date herewith by and among the Borrower, the Guarantors now
or hereafter party thereto, the Lenders now or hereafter party thereto (the
“Lenders”), LaSalle Bank National Association, Société Générale, New York Branch
and SunTrust Bank, each in its capacity as a co-documentation agent, and
Citicorp North America, Inc. and PNC Bank, National Association, as
Co-Administrative Agents (the “Co-Administrative Agents”), the Co-Administrative
Agents and the Lenders have agreed to make certain loans to, and issue Letters
of Credit on behalf of, the Borrower and its Subsidiaries; and

 

WHEREAS, pursuant to the Credit Agreement and that certain Issuing and Paying
Agency Agreement, dated December 31, 1991, among the Borrower, certain of its
Subsidiaries (as defined in the Credit Agreement) and The Bank of Nova Scotia
Trust Company of New York as successor-in-interest to Morgan Guaranty Trust
Company of New York, as paying agent (as supplemented, modified, amended or
restated from time to time, the “Issuing and Paying Agency Agreement”), and that
certain Indenture, dated March 7, 2002, among the Borrower, certain of its
Subsidiaries and The Bank of Nova Scotia Trust Company of New York, as trustee
(as supplemented, modified, amended or restated from time to time, the
“Indenture”), the Collateral Trustee has entered into that certain Collateral
Trust Agreement, dated of even date herewith (as supplemented, modified, amended
or restated from time to time, the “Collateral Trust Agreement”) with the
Borrower, David A. Vanaskey, as individual trustee, and the Designated
Subsidiaries (as defined therein) to accept the grant of a security interest
under this Agreement as security for the Secured Obligations (as defined below)
for the equal and ratable benefit of the Secured Parties.

 

--------------------------------------------------------------------------------

WHEREAS, the obligation of the Co-Administrative Agents and the Lenders to make
loans and extend credit under the Credit Agreement is subject to the condition,
among others, that the Debtors secure their obligations to the Collateral
Trustee and the Secured Parties under the Credit Agreement and the other Debt
Instruments and otherwise as more fully described herein in the manner set forth
herein.

 

NOW, THEREFORE, intending to be legally bound hereby, the parties hereto
covenant and agree as follows:

 

1. Terms which are defined in the Credit Agreement and not otherwise defined
herein are used herein as defined therein and the rules of Construction set
forth in Section 1.2 [Construction] of the Credit Agreement shall apply to this
Agreement. The following words and terms shall have the following meanings,
respectively, unless the context hereof otherwise clearly requires:

 

(a) “Code” means the Uniform Commercial Code as in effect in the Commonwealth of
Pennsylvania on the date hereof and as amended from time to time, except to the
extent that the conflict of law rules of such Uniform Commercial Code shall
apply the Uniform Commercial Code as in effect from time to time in any other
state to specific property or other matters (and in such case “Code” means the
Uniform Commercial Code as in effect from time to time in such other state).

 

(b) “Collateral” means all of any Debtor’s right, title and interest in, to and
under the following described property of such Debtor (except for the references
to the Debtors and capitalized terms otherwise defined in the Credit Agreement,
each capitalized term used in this Section 1(b) shall have in this Agreement the
meaning given to it by the Code):

 

(i) all now existing and hereafter acquired or arising Accounts, Goods, Health
Care Insurance Receivables, General Intangibles, Payment Intangibles, Deposit
Accounts, Chattel Paper (including, without limitation, Electronic Chattel
Paper), Documents, Instruments, Software, Investment Property, Letters of
Credit, Letter of Credit Rights, advices of credit, money, Inventory,
As-Extracted Collateral (including As-Extracted Collateral from each Debtor’s
present and future operations regardless of whether such mineral or gas
interests are presently owned or hereafter acquired by such Debtor), Commercial
Tort Claims as listed on Schedule B hereto (as such Schedule is amended or
supplemented from time to time), Equipment, Fixtures, and Supporting
Obligations, together with all products of and Accessions to any of the
foregoing and all Proceeds of any of the foregoing (including without limitation
all insurance policies and proceeds thereof);

 

(ii) to the extent, if any, not included in clause (i) above, each and every
Debtor’s present and future contracts, agreements, arrangements, or
understandings (A) for the sale, supply, provision or disposition of any coal,
natural gas, coalbed methane gas or other minerals by any Debtor, or any one or
more of its agents, representatives, successors, or assigns, to any purchaser or
acquirer thereof, and all products, replacements, and proceeds thereof
(including without limitation, all coal, natural gas and

 

- 2 -

--------------------------------------------------------------------------------

coalbed methane gas sales contracts) and (B) relating to the mining, drilling or
recovery of any mineral or gas reserves for the benefit of or on behalf of any
of the Debtors or any of their agents, representatives, successors, or assigns
(including without limitation, all contract mining, drilling or recovery
agreements and arrangements), and all products and Proceeds thereof and payments
thereunder, together with all products and Proceeds (including without
limitation all insurance policies and proceeds) of and any Accessions to any of
the foregoing;

 

(iii) to the extent, if any, not included in clauses (i) and (ii) above, all
coal, natural gas, coalbed methane gas and other minerals severed or extracted
from the ground (specifically including all “As-Extracted Collateral” of each
Debtor and all severed or extracted coal, natural gas and coalbed methane gas
purchased, acquired or obtained from other parties), and all Accounts, General
Intangibles and products and Proceeds thereof or related thereto, regardless of
whether any such coal, natural gas, coalbed methane gas or other minerals are in
raw form or processed for sale and regardless whether or not any Debtor had an
interest in the coal, natural gas, coalbed methane gas or other minerals before
extraction or severance;

 

(iv) to the extent, if any, not included in clauses (i) through (iii) above,
each and every other item of personal property and fixtures, whether now
existing or hereafter arising or acquired, including, without limitation, all
licenses, contracts and agreements together with all products and Proceeds
(including without limitation all insurance policies and proceeds) of and any
Accessions to any of the foregoing; and

 

(v) all present and future business records and information, including computer
tapes and other storage media containing the same and computer programs and
software (including without limitation, source code, object code and related
manuals and documentation and all licenses to use such software) for accessing
and manipulating such information;

 

provided, that, notwithstanding any of the foregoing, “Collateral” shall not
include (i) Excluded Properties, (ii) Pledged Collateral pledged under the
Pledge Agreement, (iii) Intellectual Property Collateral, security interests in
which are granted under the Patent, Trademark and Copyright Assignment, (iv)
Vessels (as defined in the Ship Mortgage), security interests in which are
granted under the Ship Mortgage, (v) pursuant to Section 8.1.16 of the Credit
Agreement, any assets or stock acquired in a Permitted Acquisition and to the
extent and only as long as encumbered by a Lien permitted by clauses (xiii) or
(xv) of the definition of Permitted Liens or (vi) pursuant to Section 8.1.16 of
the Credit Agreement, ownership interests/equity interests in the Excluded
Subsidiaries.

 

(c) “Debt Instrument” shall have the meaning set forth in the Collateral Trust
Agreement.

 

(d) “Event of Default” shall mean an Actionable Default (as defined in the
Collateral Trust Agreement).

 

- 3 -

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(e) “Receivables” means all of the Collateral except Inventory, As-Extracted
Collateral and Equipment of the Debtors.

 

(f) “Secured Obligations” shall mean the Secured Debt (as defined in the
Collateral Trust Agreement).

 

(g) “Secured Parties” shall mean, collectively, the Collateral Trustees (as
defined in the Collateral Trust Agreement), the Co-Administrative Agents, the
Paying Agent, the Lenders, The Bank of Nova Scotia Trust Company of New York or
any successor thereto, as paying agent under the Issuing and Paying Agency
Agreement and as trustee under the Indenture, and any holders from time to time
of the Secured Obligations, and “Secured Party” shall mean each of them
individually.

 

2. As security for the due and punctual payment and performance of the Secured
Obligations in full, each Debtor hereby agrees that the Collateral Trustee for
the equal and ratable benefit of the Secured Parties shall have, and each Debtor
hereby grants to and creates in favor of the Collateral Trustee for the equal
and ratable benefit of the Secured Parties, a continuing first priority lien on
and security interest under the Code in and to the Collateral subject only to
Permitted Liens.

 

Each Debtor jointly and severally represents and warrants to the Collateral
Trustee and the Secured Parties that (a) such Debtor has good and marketable
title to its Collateral, subject only to Permitted Liens, (b) except for the
security interest granted to and created in favor of the Collateral Trustee for
the equal and ratable benefit of the Secured Parties hereunder, all the
Collateral is free and clear of any Lien other than Permitted Liens, (c) each
Account and General Intangible in each case arising out of a material coal
supply contract or other Material Contract is in full force and effect, except
to the extent that the failure to be in full force and effect would not
reasonably be expected to result in a Material Adverse Change, (d) at the time
any Account arising from a material coal supply contract or other Material
Contract becomes subject to this Agreement, each such Account will be a good and
valid Account representing a bona fide sale of goods or services by such Debtor
except to the extent that the failure to be so would not reasonably be expected
to result in a Material Adverse Change and such goods will have been shipped to
the respective account debtors or the services will have been performed for the
respective account debtors (or for those on behalf of whom the account debtors
are obligated on the Accounts) except to the extent the failure to have so
shipped or performed would not reasonably be expected to result in a Material
Adverse Change, and no such Account will at such time be subject to any claim
for credit, allowance, setoff, recoupment, defense, counterclaim or adjustment
by any account debtor or otherwise, except for Permitted Liens and except to the
extent any such claim would not reasonably be expected to result in a Material
Adverse Change, (e) the exact legal name of the Debtor is as set forth on the
signature page hereto, (f) the state of incorporation, formation or
organization, as applicable, of such Debtor is as set forth on Schedule A hereto
and (g) the county and state of each mining and gas drilling operation, other
than Excluded Properties, of such Debtor is set forth on Schedule A hereto. Each
Debtor also represents and warrants that it has provided the Collateral Trustee
with a real estate description sufficient to enable the Collateral Trustee to
record a financing statement in the county records sufficient to perfect a
security interest in all Collateral constituting As-Extracted Collateral arising

 

- 4 -

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from such Debtor’s mining and gas drilling activities. Further, each Debtor
represents and warrants that (i) this Agreement creates a valid security
interest in favor of the Collateral Trustee, for the equal and ratable benefit
of the Secured Parties hereunder, in the Collateral, except as may be limited by
applicable bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium or similar laws affecting the rights of creditors generally and by
general principles of equity and (ii) the security interests granted hereunder
in favor of the Collateral Trustee, for the equal and ratable benefit of the
Secured Parties hereunder, will be perfected and constitute a first priority
security interest (subject only to Permitted Liens), (A) with respect to the
Collateral of the type that can be perfected by filing under the Code (other
than As-Extracted Collateral) of each Debtor, upon the proper filing of the
financing statements in the jurisdiction of the state of organization of such
Debtor as indicated on Schedule A hereto, and (B) with respect to the Collateral
constituting As-Extracted Collateral of each Debtor, upon the proper filing of
the financing statements in the county’s real estate records in the county
identified on Schedule A hereto as the location of “Mining and Drilling
Operations” with respect to such Debtor.

 

3. Each Debtor will preserve and protect the Collateral Trustee’s security
interest in the Collateral as a perfected security interest under the Code,
superior and prior to the rights of all third Persons, except for holders of
Permitted Liens, and will do all such other acts and things and will, upon
request therefor by the Collateral Trustee, execute, deliver, file and record,
and each Debtor hereby authorizes the Collateral Trustee to so file, all such
other documents and instruments, including, without limitation, financing
statements, security agreements, assignments and documents and powers of
attorney with respect to the Collateral, and pay all filing fees and taxes
related thereto, as the Collateral Trustee in its reasonable discretion may deem
necessary or advisable from time to time in order to attach, continue, preserve,
perfect, and protect said security interest (including the filing at any time or
times after the date hereof of financing statements under, and in the locations
advisable pursuant to, the Code); and, each Debtor hereby irrevocably appoints
the Collateral Trustee, its officers, employees and agents, or any of them, as
attorneys-in-fact for such Debtor to execute, deliver, file and record such
items for such Debtor and in such Debtor’s name, place and stead. This power of
attorney, being coupled with an interest, shall be irrevocable for the life of
this Agreement.

 

4. Each Debtor jointly and severally covenants and agrees that:

 

(a) it will defend the Collateral Trustee’s and the Secured Parties’ right,
title and lien on and security interest in and to the Collateral against the
claims and demands of all Persons whomsoever, other than any Person claiming a
right in the Collateral pursuant to (i) an agreement between such Person and the
Collateral Trustee, or (ii) any Permitted Lien;

 

(b) it will not suffer or permit to exist on any Collateral any Lien except for
Permitted Liens;

 

(c) except as permitted by the Credit Agreement, it will not take or omit to
take any action, the taking or the omission of which might result in a material
alteration or impairment of the Collateral or of the Collateral Trustee’s rights
under this Agreement;

 

- 5 -

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(d) it will not sell, assign or otherwise dispose of any portion of the
Collateral except as permitted by the Credit Agreement;

 

(e) it will (i) maintain its chief executive office and keep all records
pertaining to the Collateral at the locations specified on the Security Interest
Data Summary attached as Schedule A hereto, unless it shall have given the
Collateral Trustee prior notice and taken any action reasonably requested by the
Collateral Trustee to maintain its security interest therein, (ii) notify the
Collateral Trustee if an Account in excess of $30,000 individually or $1,000,000
in the aggregate becomes evidenced or secured by an Instrument or Chattel Paper
(specifically excluding, however, any such Instrument payable by an individual
in an amount not in excess of $5,000) and deliver to the Collateral Trustee upon
the Collateral Trustee’s request therefor all Collateral consisting of
Instruments and Chattel Paper, other than Chattel Paper or Instruments
representing less than $30,000 individually or $1,000,000 in the aggregate (and
specifically excluding, however, any such Instrument payable by an individual in
an amount not in excess of $5,000), immediately upon such Debtor’s receipt of a
request therefor, and (iii) keep materially accurate and complete books and
records concerning the Collateral and such other books and records as the
Collateral Trustee may from time to time reasonably require;

 

(f) after an Event of Default, it will promptly furnish to the Collateral
Trustee such information and documents relating to the Collateral as the
Collateral Trustee may reasonably request, including, without limitation, all
invoices, Documents, contracts, Chattel Paper, Instruments and other writings
pertaining to such Debtor’s contracts or the performance thereof, all of the
foregoing to be certified upon request of the Collateral Trustee by an
authorized officer of such Debtor;

 

(g) it shall immediately notify the Collateral Trustee if any Account in excess
of $1,000,000 arises out of contracts with the United States or any department,
agency or instrumentality thereof or any one or more of the states of the United
States or any department, agency, or instrumentality thereof, and will execute
any instruments and take any steps required by the Collateral Trustee so that
all monies due and to become due under such contract shall be assigned to the
Collateral Trustee and notice of the assignment given to and acknowledged by the
appropriate government agency or authority under the Federal Assignment of
Claims Act;

 

(h) such Debtor will not change its state of incorporation, formation or
organization, as applicable without providing thirty (30) days prior written
notice to the Collateral Trustee;

 

(i) such Debtor will not commence commercial production from any new mining or
gas operation or permit any party to commence commercial production of minerals
or gas from any of its mineral or gas reserves, in each case, other than with
respect to Excluded Properties or properties already the subject of As-Extracted
Collateral filings under the Code with security interests already perfected
therein, (whether leased or owned in fee by such Debtor) without providing
fifteen (15) days prior written notice to the Collateral Trustee, and providing
the Collateral Trustee with sufficient real estate information to enable the
Collateral Trustee to file financing statements to perfect an interest in
Collateral consisting of As-Extracted Collateral with respect to such operation;

 

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(j) such Debtor will not change its name without providing thirty (30) days
prior written notice to the Collateral Trustee;

 

(k) if such Debtor shall at any time acquire a commercial tort claim, as defined
in the Code, with respect to which a recovery in excess of $500,000 would
reasonably be expected to be obtained, such Debtor shall immediately notify the
Collateral Trustee in a writing signed by such Debtor of the details thereof and
grant to the Collateral Trustee for the equal and ratable benefit of the Secured
Parties in such writing a security interest therein and in the proceeds thereof,
with such writing to be in form and substance reasonably satisfactory to the
Collateral Trustee and such writing shall constitute a supplement to Schedule B
hereto;

 

(l) in furtherance of this Agreement, each Debtor hereby authorizes the
Collateral Trustee to, at any time and from time to time, file in any one or
more jurisdictions financing statements that describe the Collateral, together
with continuation statements thereof and amendments thereto, without the
signature of such Debtor and that contain any information required by the Code
or any other applicable statute applicable to such jurisdiction for the
sufficiency or filing office acceptance of any financing statements,
continuation statements, or amendments. Each Debtor agrees to furnish any such
information to the Collateral Trustee promptly upon request. Any such financing
statements, continuation statements, or amendments may be signed by the
Collateral Trustee on behalf of such Debtor if the Collateral Trustee so elects
and may be filed at any time in any jurisdiction;

 

(m) except with respect to Deposit Accounts the average daily balance of which
does not exceed $5,000,000 unless otherwise requested by the Paying Agent in
writing, it will use its commercial good faith efforts to maintain all Deposit
Accounts only with the Collateral Trustee or with banks (the “Pledged Account
Banks”) that have agreed, in a record authenticated by such Debtor, the
Collateral Trustee and the Pledged Account Banks, to (i) upon the occurrence and
during the continuance of an Event of Default, comply with instructions
originated by the Collateral Trustee directing the disposition of funds in the
Deposit Accounts without the further consent of such Debtor and (ii) waive or
subordinate in favor of the Collateral Trustee all claims of the Pledged Account
Banks (including, without limitation, claims by way of a security interest, lien
or right of setoff or right of recoupment) to the Deposit Accounts, which
authenticated record shall be substantially in the form of Exhibit A hereto, or
shall otherwise be in form and substance reasonably satisfactory to the
Collateral Trustee (the “Account Control Agreement”);

 

(n) in the event any Deposit Account is maintained with any Person that has not
entered into an Account Control Agreement with respect thereto or otherwise is
not subject to the “control” of the Collateral Trustee within the meaning of
Section 9-104 of the Code, within 15 Business Days after the date hereof, the
average daily account balance in each such Deposit Account, as the case may be,
shall not exceed $5,000,000;

 

(o) it will not add any bank that maintains a Deposit Account for such Debtor or
open any new Deposit Account with any then existing Pledged Account Bank unless
the Collateral Trustee shall have received, an Account Control Agreement
authenticated by such new bank and such Debtor, or a supplement to an existing
Account Control Agreement with such then existing Pledged Account Bank, covering
such Deposit Account;

 

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(p) it will maintain exclusive possession and control of its Equipment and
Inventory at the locations specified therefor on Schedule A hereto, as such
Schedule A may be amended from time to time hereunder, unless 10 days’ prior
notice has been given to the Collateral Trustee (upon which notice Schedule A
will be automatically amended as set forth in such notice), except with respect
to (i) Equipment and Inventory stored at any leased premises or warehouse so
indicated by an asterisk on Schedule A hereto as to which such Debtor will use
its commercial good faith efforts to cause a landlord’s or warehouseman’s
agreement, in form and substance reasonably satisfactory to the Collateral
Trustee, to be in effect within 15 Business Days after the date hereof, (ii)
certain Equipment, comprising longwall equipment, shields and face conveyor
components held at Mt. Morris, Pennsylvania, Morgantown, West Virginia, and
Homer City, Pennsylvania, having a value of approximately $20,000,000 (which
Equipment such Debtor will use its commercial good faith efforts to cause to be
located on its or another Debtor’s premises within 1 year after the date
hereof), (iii) Equipment and Inventory that has an aggregate value no greater
than $10,000,000 at any one time, (iv) Inventory in transit in the ordinary
course of business to its customers or (v) Equipment under repair (with respect
to which such Debtor will give notice to the Collateral Trustee if the fair
market value of such Equipment exceeds $20,000,000);

 

(q) it will maintain (i) all Electronic Chattel Paper so that the Collateral
Trustee has control of the Electronic Chattel Paper in the manner specified in
Section 9-105 of the Code and (ii) all transferable records so that the
Collateral Trustee has control of the transferable records in the manner
specified in Section 16 of the Uniform Electronic Transactions Act, as in effect
in the jurisdiction governing such transferable record;

 

(r) it will deliver to the Collateral Trustee all certificates or Instruments
representing or evidencing Collateral (representing, or having a fair market
value of, more than $30,000 individually or $1,000,000 in the aggregate,
specifically excluding, however, any such Instrument payable by an individual in
an amount not in excess of $5,000), which certificates or Instruments shall be
in suitable form for transfer by delivery, or shall be accompanied by duly
executed instruments of transfer or assignment in blank, all in form and
substance reasonably satisfactory to the Collateral Trustee;

 

(s) with respect to any Collateral in which any Debtor has any right, title or
interest and that constitutes an uncertificated security, such Debtor will cause
the issuer thereof either (i) to note or register the security interest created
hereby in the appropriate company records or (ii) to agree in an authenticated
record with such Debtor and the Collateral Trustee that upon the occurrence and
during the continuance of an Event of Default such issuer will comply with
instructions with respect to such security originated by the Collateral Trustee
without further consent of such Debtor, such authenticated record to be in form
and substance reasonably satisfactory to the Collateral Trustee and such Debtor;

 

(t) except with respect to security entitlements the average daily balance of
which does not exceed $5,000,000 unless otherwise requested by the Paying Agent
in writing, with respect to any Collateral in which any Debtor has any right,
title or interest and that constitutes a security entitlement in which the
Collateral Trustee is not the entitlement holder, such Debtor will use its
commercial good faith efforts to cause the securities intermediary with respect
to such security entitlement to either (i) to identify in its records the
Collateral Trustee as the entitlement

 

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holder of such security entitlement against such securities intermediary or (ii)
agree in an authenticated record with such Debtor and the Collateral Trustee
that, upon the occurrence and during the continuance of an Event of Default,
such securities intermediary will comply with entitlement orders (that is,
notifications communicated to such securities intermediary directing transfer or
redemption of the financial asset to which such Debtor has a security
entitlement) originated by the Collateral Trustee without further consent of
such Debtor, such authenticated record to be in substantially the form of
Exhibit B hereto or otherwise in form and substance reasonably satisfactory to
the Collateral Trustee (such agreement being a “Securities Account Control
Agreement”);

 

(u) except with respect to commodity contracts the average daily balance of
which does not exceed $5,000,000 unless otherwise requested by the Paying Agent
in writing, with respect to any Collateral in which any Debtor has any right,
title or interest and that constitutes a commodity contract, such Debtor will
use its commercial good faith efforts to cause the commodity intermediary with
respect to such commodity contract to agree in an authenticated record with such
Debtor and the Collateral Trustee that, upon the occurrence and during the
continuance of an Event of Default, such commodity intermediary will apply any
value distributed on account of such commodity contract as directed by the
Collateral Trustee without further consent of such Debtor, such authenticated
record to be in the form of Exhibit C hereto or otherwise in form and substance
reasonably satisfactory to the Collateral Trustee (such agreement being a
“Commodity Account Control Agreement”, and all such authenticated records,
together with all Securities Account Control Agreements being, collectively,
“Security Control Agreements”);

 

(v) no Debtor will change or add any securities intermediary or commodity
intermediary that maintains any securities account or commodity account in which
any of the Collateral is credited or carried, or change or add any such
securities account or commodity account, in each case without first complying
with the above provisions of Section 2(q) through (s) in order to perfect the
security interest granted hereunder in such Collateral;

 

(w) in the event any Collateral is maintained with any Person that has not
entered into a Security Control Agreement with respect thereto or otherwise
subject to the “control” of the Collateral Trustee within the meaning of Section
9-106 of the Code within 15 Business Days after the date hereof, the average
daily account balance in each such account shall not exceed $5,000,000; and

 

(x) upon the request of the Collateral Trustee upon the occurrence and during
the continuance of an Event of Default, such Debtor will notify each issuer of
debt that is part of the Collateral that such debt is subject to the security
interest herein granted.

 

5. The Collateral Trustee shall be deemed to have exercised reasonable care in
the custody and preservation of the Collateral in its possession if the
Collateral Trustee takes any action for that purpose as any Debtor shall request
in writing, provided that such requested action will not, in the judgment of the
Collateral Trustee, impair the security interest in the Collateral created
hereby or the Collateral Trustee’s and the Secured Parties’ rights in, or the
value of, the

 

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Collateral, and provided further that such written request is received by the
Collateral Trustee in sufficient time to permit the Collateral Trustee to take
the requested action.

 

6. The pledge, security interests, and other Liens and the obligations of each
Debtor hereunder shall not be discharged or impaired or otherwise diminished by
any failure, default, omission, or delay, willful or otherwise, by the
Collateral Trustee, or any other obligor on any of the Secured Obligations, or
by any other act or thing or omission or delay to do any other act or thing
which may or might in any manner or to any extent vary the risk of such Debtor
or which would otherwise operate as a discharge of such Debtor as a matter of
law or equity, except for, and to the extent of, payment and performance of the
Secured Obligations. Without limiting the generality of the foregoing, each
Debtor hereby consents to, and the pledge, security interests, and other Liens
given by such Debtor hereunder shall not be diminished, terminated, or otherwise
similarly affected by any of the following at any time and from time to time:

 

(a) Any lack of genuineness, legality, validity, enforceability, or allowability
(in a bankruptcy, insolvency, reorganization or similar proceeding, or
otherwise), or any avoidance or subordination, in whole or in part, of any Debt
Instrument or any of the Secured Obligations and regardless of any law,
regulation, or order now or hereafter in effect in any jurisdiction affecting
any of the Secured Obligations, any of the terms of the Debt Instruments, or any
rights of the Collateral Trustee or any other Person with respect thereto;

 

(b) Any increase, decrease, or change in the amount, nature, type or purpose of
any of the Secured Obligations (whether or not contemplated by the Debt
Instruments as presently constituted); any change in the time, manner, method,
or place of payment or performance of, or in any other term of, any of the
Secured Obligations; any execution or delivery of any additional Debt
Instruments or documents evidencing or related to the Secured Obligations or any
of them; or any amendment, modification or supplement to, or refinancing or
refunding of, any Debt Instrument or any of the Secured Obligations;

 

(c) Any failure to assert any breach of or default under any Debt Instrument or
any of the Secured Obligations; any extensions of credit in excess of the amount
committed under or contemplated by any Debt Instrument, or in circumstances in
which any condition to such extensions of credit has not been satisfied; any
other exercise or non-exercise, or any other failure, omission, breach, default,
delay, or wrongful action in connection with any exercise or non-exercise, of
any right or remedy against such Debtor or any other Person under or in
connection with any Debt Instrument or any of the Secured Obligations; any
refusal of payment or performance of any of the Secured Obligations, whether or
not with any reservation of rights against any Debtor; or any application of
collections (including collections resulting from realization upon any direct or
indirect security for the Secured Obligations) to other obligations, if any, not
entitled to the benefits of this Agreement, in preference to Secured Obligations
or, if any collections are applied to Secured Obligations, any application to
particular Secured Obligations;

 

(d) Any taking, exchange, amendment, modification, supplement, termination,
subordination, release, loss, or impairment of, or any failure to protect,
perfect, or preserve the value of, or any enforcement of, realization upon, or
exercise of rights or remedies under or in connection with, or any failure,
omission, breach, default, delay, or wrongful action by the

 

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Collateral Trustee or any other Person in connection with the enforcement of,
realization upon, or exercise of rights or remedies under or in connection with,
or, any other action or inaction by the Collateral Trustee or any other Person
in respect of, any direct or indirect security for any of the Secured
Obligations (including the Collateral). As used in this Agreement, “direct or
indirect security” for the Secured Obligations, and similar phrases, includes
any collateral security, guaranty, suretyship, letter of credit, capital
maintenance agreement, put option, subordination agreement, or other right or
arrangement of any nature providing direct or indirect assurance of payment or
performance of any of the Secured Obligations, made by or on behalf of any
Person;

 

(e) Any merger, consolidation, liquidation, dissolution, winding-up, charter
revocation, or forfeiture, or other change in, restructuring or termination of
the corporate structure or existence of, any Debtor or the Borrower or any other
Person; any bankruptcy, insolvency, reorganization or similar proceeding with
respect to any Debtor or the Borrower or any other Person; or any action taken
or election (including any election under Section 1111(b)(2) of the United
States Bankruptcy Code or any comparable law of any jurisdiction) made by the
Collateral Trustee or any Debtor or the Borrower or by any other Person in
connection with any such proceeding;

 

(f) Any defense, setoff, or counterclaim which may at any time be available to
or be asserted by any Debtor or the Borrower or any other Person with respect to
any Debt Instrument or any of the Secured Obligations, other than, and to the
extent of, payment and performance of the Secured Obligations; or any discharge
by operation of law or release of any Debtor or the Borrower or any other Person
from the performance or observance of any Debt Instrument or any of the Secured
Obligations; and

 

(g) Any other event or circumstance, whether similar or dissimilar to the
foregoing, and whether known or unknown, which might otherwise constitute a
defense available to, or limit the liability of a guarantor or a surety,
including any Debtor, excepting only full, strict, and indefeasible payment and
performance of the Secured Obligations in full.

 

7. Each Debtor hereby waives any and all defenses which any Debtor may now or
hereafter have based on principles of suretyship, impairment of collateral, or
the like, other than, and to the extent of, the defense of prior payment of the
Secured Obligations, and each Debtor hereby waives any defense to or limitation
on its obligations under this Agreement arising out of or based on any event or
circumstance referred to in the immediately preceding section hereof, other
than, and to the extent of, the defense of prior payment of the Secured
Obligations. Without limiting the generality of the foregoing and to the fullest
extent permitted by applicable law, each Debtor hereby further waives each of
the following:

 

(a) Except as may be expressly provided in the Credit Agreement or the other
Debt Instruments, all notices, disclosures and demands of any nature which
otherwise might be required from time to time to preserve intact any rights
against such Debtor, including the following: any notice of any event or
circumstance described in the immediately preceding section hereof; any notice
required by any law, regulation or order now or hereafter in effect in any
jurisdiction; any notice of nonpayment, nonperformance, dishonor, or protest
under any Debt Instrument or any of the Secured Obligations; any notice of the
incurrence of any Secured Obligations; any notice of

 

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any default or any failure on the part of such Debtor or the Borrower or any
other Person to comply with any Debt Instrument or any of the Secured
Obligations or any requirement pertaining to any direct or indirect security for
any of the Secured Obligations; and any notice or other information pertaining
to the business, operations, condition (financial or otherwise), or prospects of
the Borrower or any other Person;

 

(b) Any right to any marshalling of assets, to the filing of any claim against
such Debtor or the Borrower or any other Person in the event of any bankruptcy,
insolvency, reorganization, or similar proceeding, or to the exercise against
such Debtor or the Borrower, or any other Person of any other right or remedy
under or in connection with any Debt Instrument or any of the Secured
Obligations or any direct or indirect security for any of the Secured
Obligations; any requirement of promptness or diligence on the part of the
Collateral Trustee or any other Person; any requirement to exhaust any remedies
under or in connection with, or to mitigate the damages resulting from default
under, any Debt Instrument or any of the Secured Obligations or any direct or
indirect security for any of the Secured Obligations; any benefit of any statute
of limitations; and any requirement of acceptance of this Agreement or any other
Debt Instrument, and any requirement that any Debtor receive notice of any such
acceptance; and

 

(c) Any defense or other right arising by reason of any Law now or hereafter in
effect in any jurisdiction pertaining to election of remedies (including
anti-deficiency laws, “one action” laws, or the like), or by reason of any
election of remedies or other action or inaction by the Collateral Trustee
(including commencement or completion of any judicial proceeding or nonjudicial
sale or other action in respect of collateral security for any of the Secured
Obligations), which results in denial or impairment of the right of the
Collateral Trustee to seek a deficiency against the Borrower or any other Person
or which otherwise discharges or impairs any of the Secured Obligations.

 

8. The Secured Obligations and additional liabilities of the Debtors under this
Agreement are joint and several obligations of the Debtors, and each Debtor
hereby waives to the full extent permitted by law any defense it may otherwise
have to the payment and performance of the Secured Obligations that its
liability hereunder is limited and not joint and several. Each Debtor
acknowledges and agrees that the foregoing waivers serve as a material
inducement to the agreement of the Lenders to make the Loans, and that the
Lenders are relying on each specific waiver and all such waivers in entering
into this Agreement. The undertakings of each Debtor hereunder secure the
obligations of itself and the other Debtors. The Collateral Trustee may, in its
sole discretion, elect to enforce this Agreement against any Debtor without any
duty or responsibility to pursue any other Debtor and such an election by the
Collateral Trustee shall not be a defense to any action the Collateral Trustee
and the Secured Parties, or any of them, may elect to take against any Debtor.
Each of the Secured Parties and the Collateral Trustee hereby reserve all rights
against each Debtor.

 

9. (a) At any time and from time to time whether or not an Event of Default then
exists and without prior notice to or consent of any Debtor, the Collateral
Trustee may at its option take such actions as the Collateral Trustee deems
reasonably necessary or appropriate (i) to attach, perfect, continue, preserve
and protect the Collateral Trustee’s and the Secured Parties’ first priority
security interest in or lien on the Collateral, and/or (ii) to inspect, audit
and

 

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verify the Collateral, including reviewing all of such Debtor’s books and
records and copying and making excerpts therefrom, provided that prior to an
Event of Default, the same is done with reasonable advance notice during normal
business hours to the extent access to such Debtor’s premises is required and in
accordance with such Debtor’s standard safety, visit and inspection procedures
and no such visit, or inspection shall interfere with such Debtor’s normal
business operation; and

 

(b) At any time and from time to time after an Event of Default exists and is
continuing and without prior notice to or consent of any Debtor, the Collateral
Trustee may at its option take such action as the Collateral Trustee deems
reasonably necessary or appropriate (i) to maintain, repair, protect and insure
the Collateral, and/or (ii) to perform, keep, observe and render true and
correct any and all covenants, agreements, representations and warranties of any
Debtor hereunder.

 

10. After there exists any Event of Default under the Credit Agreement:

 

(a) The Collateral Trustee shall have and may exercise all the rights and
remedies available to a secured party under the Code in effect at the time, and
such other rights and remedies as may be provided by Law and as set forth below,
including without limitation to take over and collect all of any Debtor’s
Receivables and all other Collateral, and to this end, upon and during the
continuation of an Event of Default, each Debtor hereby appoints the Collateral
Trustee, its officers, employees and agents, as its irrevocable, true and lawful
attorneys-in-fact with all necessary power and authority to: (i) take possession
immediately, with or without notice, demand, or legal process, of any of or all
of the Collateral wherever found, and for such purposes, enter upon any premises
upon which the Collateral may be found and remove the Collateral therefrom, (ii)
require any Debtor to assemble the Collateral and deliver it to the Collateral
Trustee or to any place designated by the Collateral Trustee at such Debtor’s
expense, (iii) receive, open and dispose of all mail addressed to any Debtor and
notify postal authorities to change the address for delivery thereof to such
address as the Collateral Trustee may designate, (iv) demand payment of the
Receivables, as applicable, (v) enforce payment of the Receivables, as
applicable, by legal proceedings or otherwise, (vi) exercise all of any Debtor’s
rights and remedies with respect to the collection of the Receivables, as
applicable, (vii) settle, adjust, compromise, extend or renew the Receivables,
(viii) settle, adjust or compromise any legal proceedings brought to collect the
Receivables, as applicable, (ix) to the extent permitted by applicable Law, sell
or assign the Receivables upon such terms, for such amounts and at such time or
times as the Collateral Trustee deems advisable, (x) discharge and release the
Receivables, (xi) take control, in any manner, of any item of payment or
proceeds from any account debtor, (xii) prepare, file and sign any Debtor’s name
on any proof of claim in Bankruptcy or similar document against any account
debtor, (xiii) prepare, file and sign any Debtor’s name on any notice of Lien,
assignment or satisfaction of Lien or similar document in connection with the
Receivables, (xiv) do all acts and things necessary, in the Collateral Trustee’s
sole discretion, to fulfill any Debtor’s obligations to the Collateral Trustee
or the Secured Parties under the Credit Agreement, any other Debt Instrument or
otherwise, (xv) endorse the name of any Debtor upon any check, Chattel Paper,
Document, Instrument, invoice, freight bill, bill of lading or similar document
or agreement relating to the Receivables or Inventory; (xvi) use any Debtor’s
stationery and sign such Debtor’s name to verifications of the Receivables and
notices thereof to account debtors; (xvii) access and

 

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use the information recorded on or contained in any data processing equipment or
computer hardware or software relating to the Receivables, Inventory, or other
Collateral or proceeds thereof to which any Debtor has access, (xviii) demand,
sue for, collect, compromise and give acquittances for any and all Collateral,
(xix) prosecute, defend or compromise any action, claim or proceeding with
respect to any of the Collateral, and (xx) take such other action as the
Collateral Trustee may deem appropriate, including extending or modifying the
terms of payment of any Debtor’s debtors. This power of attorney, being coupled
with an interest, shall be irrevocable for the life of this Agreement. To the
extent permitted by Law, each Debtor hereby waives all claims of damages due to
or arising from or connected with any of the rights or remedies exercised by the
Collateral Trustee pursuant to this Agreement, except claims for physical damage
to the Collateral arising from gross negligence or willful misconduct by the
Collateral Trustee.

 

(b) The Collateral Trustee shall have the right to lease, sell or otherwise
dispose of all or any of the Collateral at public or private sale or sales for
cash, credit or any combination thereof, with such notice as may be required by
Law (it being agreed by each Debtor that, in the absence of any contrary
requirement of Law, ten (10) days’ prior notice of a public or private sale of
Collateral shall be deemed reasonable notice), in lots or in bulk, for cash or
on credit, all as the Collateral Trustee, in its sole discretion, may deem
advisable. Such sales may be adjourned from time to time with or without notice.
The Collateral Trustee shall have the right to conduct such sales on any
Debtor’s premises or elsewhere and shall have the right to use any Debtor’s
premises without charge for such sales for such time or times as the Collateral
Trustee may see fit.

 

(c) Each Debtor, at its cost and expense (including the cost and expense of any
of the following referenced consents, approvals, etc.), will promptly execute
and deliver or cause the execution and delivery of all applications,
certificates, instruments, registration statements, and all other documents and
papers the Collateral Trustee may request in connection with the obtaining of
any consent, approval, registration, qualification, permit, license,
accreditation, or authorization of any other Official Body or other Person
necessary or appropriate for the effective exercise of any rights hereunder or
under the other Debt Instruments. Without limiting the generality of the
foregoing, each Debtor agrees that in the event the Collateral Trustee, on
behalf of the Secured Parties shall exercise its rights hereunder or pursuant to
the other Loan Documents to which it is a party, to sell, transfer, or otherwise
dispose of, or vote, consent, operate, or take any other action in connection
with any of the Collateral, such Debtor shall execute and deliver (or cause to
be executed and delivered) all applications, certificates, assignments and other
documents that the Collateral Trustee requests to facilitate such actions and
shall otherwise promptly, fully, and diligently cooperate with the Collateral
Trustee and any other Persons in making any application for the prior consent or
approval of any Official Body or any other Person to the exercise by the
Collateral Trustee on behalf of the Secured Parties or any such rights relating
to all or any of the Collateral. Furthermore, because each Debtor agrees that
the remedies at law, of the Collateral Trustee, on behalf of the Secured
Parties, for failure of such Debtor to comply with this Subsection (c) would be
inadequate, and that any such failure would not be adequately compensable in
damages, each Debtor agrees that this Subsection (c) may be specifically
enforced.

 

(d) The Collateral Trustee may request, without limiting the rights and remedies
of the Collateral Trustee on behalf of the Secured Parties otherwise provided
hereunder and under the

 

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other Loan Document to which it is a party, that each Debtor do any of the
following: (i) give the Collateral Trustee on behalf of the Secured Parties
specific assignments of the accounts receivable of such Debtor after such
accounts receivable come into existence, and schedules of such accounts
receivable, the form and content of such assignment and schedules to be
satisfactory to the Collateral Trustee, and (ii) in order to better secure the
Collateral Trustee on behalf of the Secured Parties, to the extent permitted by
Law, enter into such lockbox agreements and establish such lockbox accounts as
the Collateral Trustee may require, all at the sole expense of such Debtor and
shall direct all payments from all payors due to such Debtor, to such lockbox
accounts.

 

11. The lien on and security interest in each Debtor’s Collateral granted to and
created in favor of the Collateral Trustee by this Agreement shall be for the
equal and ratable benefit of the Secured Parties. Each of the rights,
privileges, and remedies provided to the Collateral Trustee hereunder or
otherwise by Law with respect to any Debtor’s Collateral shall be exercised by
the Collateral Trustee only for the equal and ratable benefit of the Secured
Parties, and any of such Debtor’s Collateral or proceeds thereof held or
realized upon at any time by the Collateral Trustee shall be applied as set
forth in Section 3 of the Collateral Trust Agreement. Each Debtor shall remain
liable to the Secured Parties for and shall pay to the Collateral Trustee for
the equal and ratable benefit of the Secured Parties any deficiency which may
remain after such sale or collection.

 

12. If the Collateral Trustee repossesses or seeks to repossess any of the
Collateral pursuant to the terms hereof because of the occurrence of an Event of
Default, then to the extent it is commercially reasonable for the Collateral
Trustee to store any Collateral on any of any Debtor’s premises, each Debtor
hereby agrees to lease to the Collateral Trustee on a month-to-month tenancy for
a period not to exceed one hundred twenty (120) days at the Collateral Trustee’s
election, at a rental of One Dollar ($1.00) per month, the premises on which the
Collateral is located, provided it is located on premises owned or leased by
such Debtor.

 

13. This Agreement shall terminate upon the satisfaction of the conditions set
forth in, and in accordance with the provisions of, Section 6 of the Collateral
Trust Agreement. All or any portion of the Collateral shall be released upon the
satisfaction of the conditions set forth in, and in accordance with the
provisions of, Section 6 of the Collateral Trust Agreement. Until such time,
however, this Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and permitted assigns.

 

14. No failure or delay on the part of the Collateral Trustee in exercising any
right, remedy, power or privilege hereunder shall operate as a waiver thereof or
of any other right, remedy, power or privilege of the Collateral Trustee
hereunder; nor shall any single or partial exercise of any such right, remedy,
power or privilege preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege. No waiver of a single
Event of Default shall be deemed a waiver of a subsequent Event of Default. All
waivers under this Agreement must be in writing. The rights and remedies of the
Collateral Trustee under this Agreement are cumulative and in addition to any
rights or remedies which it may otherwise have, and the Collateral Trustee may
enforce any one or more remedies hereunder successively or concurrently at its
option.

 

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15. All notices, statements, requests and demands given to or made upon either
party hereto in accordance with the provisions of this Agreement shall be given
or made as provided in Section 11.6 [Notices] of the Credit Agreement in the
case of the Debtors and as set forth in Section 7.2 of the Collateral Trust
Agreement in the case of the Collateral Trustee.

 

16. Each Debtor agrees that as of the date hereof, all information contained on
the Security Interest Data Schedule attached hereto as Schedule A is accurate
and complete and contains no omission or misrepresentation.

 

17. Each Debtor acknowledges that the provisions hereof giving the Collateral
Trustee rights of access to books, records and information concerning the
Collateral and such Debtor’s operations and providing the Collateral Trustee
access to such Debtor’s premises are intended to afford the Collateral Trustee
with immediate access to current information concerning such Debtor and its
activities, including without limitation, the value, nature and location of the
Collateral so that the Collateral Trustee can, among other things, make an
appropriate determination after the occurrence of an Event of Default, whether
and when to exercise its other remedies hereunder and at Law, including without
limitation, instituting a replevin action should any Debtor refuse to turn over
any Collateral to the Collateral Trustee. Each Debtor further acknowledges that
should such Debtor at any time fail to promptly provide such information and
give the Collateral Trustee the rights of access to books, records and
information concerning the Collateral and such Debtor’s operations as provided
in this Agreement, each Debtor acknowledges that the Collateral Trustee would
have no adequate remedy at Law to promptly obtain the same. Each Debtor agrees
that the provisions hereof may be specifically enforced by the Collateral
Trustee and waives any claim or defense in any such action or proceeding that
the Collateral Trustee has an adequate remedy at Law. The Collateral Trustee
shall have the absolute right to share any information which it gains from the
foregoing with any Secured Party.

 

18. It is anticipated that additional Persons may from time to time become
Subsidiaries of the Borrower or a Guarantor, each of whom will be required to
join in this Agreement as a Debtor to the extent required by the Credit
Agreement. It is acknowledged and agreed that new Subsidiaries of the Borrower
or a Guarantor may become parties hereunder and will be bound hereby simply by
executing and delivering to the Collateral Trustee a Guarantor Joinder in the
form of Exhibit 1.1(G)(1) to the Credit Agreement. In addition, a new Schedule A
hereto shall be provided to Collateral Trustee showing accurate and complete
information regarding the information contained in the Security Interest Data
Schedule attached hereto as Schedule A.

 

19. (a) This Agreement shall be binding upon and inure to the benefit of the
Collateral Trustee, the Secured Parties and their respective successors and
assigns, and each Debtor and each of its respective successors and assigns,
except that no Debtor may assign or transfer such Debtor’s obligations hereunder
or any interest herein other than assignments and transfers permitted by the
Credit Agreement.

 

(b) The Collateral Trustee may resign and a successor Collateral Trustee may be
appointed in the manner provided in the Collateral Trust Agreement. Upon the
acceptance of any appointment as a collateral trustee by a successor collateral
trustee, that successor collateral trustee shall thereupon succeed to and become
vested with all the rights, powers, privileges and

 

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duties of the retiring collateral trustee, as secured party under this Agreement
and the retiring collateral trustee shall thereupon be discharged from its
duties and obligations under this Agreement. After any retiring collateral
trustee’s resignation, the provisions of this Agreement shall inure to its
benefit as to any actions taken or omitted to be taken by it under this
Agreement while it was Collateral Trustee.

 

20. This Agreement shall be deemed to be a contract under the laws of the
Commonwealth of Pennsylvania and for all purposes shall be governed by and
construed in accordance with the laws of said Commonwealth without regard to its
conflict of laws principles, except to the extent that the validity or
perfection of the Lien and the security interest hereunder, or remedies
hereunder, in respect of any particular Collateral are governed by the laws of a
jurisdiction other than the Commonwealth of Pennsylvania.

 

21. The provisions of this Agreement are intended to be severable. If any
provision of this Agreement shall be held invalid or unenforceable in whole or
in part in any jurisdiction, such provision shall, as to such jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without in any
manner affecting the validity or enforceability thereof in any other
jurisdiction or the remaining provisions hereof in any jurisdiction.

 

22. EACH DEBTOR AND THE COLLATERAL TRUSTEE HEREBY IRREVOCABLY CONSENTS TO THE
NONEXCLUSIVE JURISDICTION OF THE COURT OF COMMON PLEAS OF ALLEGHENY COUNTY AND
THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF PENNSYLVANIA AND
THE DELAWARE STATE AND UNITED STATES DISTRICT COURTS LOCATED IN WILMINGTON,
DELAWARE, AND WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS UPON IT AND
CONSENTS THAT ALL SUCH SERVICE OF PROCESS BE MADE BY CERTIFIED OR REGISTERED
MAIL DIRECTED TO SUCH DEBTOR OR THE COLLATERAL TRUSTEE AT THE ADDRESSES PROVIDED
FOR IN SECTION 15 HEREOF AND SERVICE SO MADE SHALL BE DEEMED TO BE COMPLETED
UPON ACTUAL RECEIPT THEREOF. EACH DEBTOR AND THE COLLATERAL TRUSTEE WAIVES ANY
OBJECTION TO JURISDICTION AND VENUE OF ANY ACTION INSTITUTED AGAINST IT AS
PROVIDED HEREIN AND AGREES NOT TO ASSERT ANY DEFENSE BASED ON LACK OF
JURISDICTION OR VENUE.

 

23. EACH DEBTOR AND THE COLLATERAL TRUSTEE HEREBY WAIVES TRIAL BY JURY IN ANY
ACTION, SUIT, PROCEEDING OR COUNTERCLAIM OF ANY KIND ARISING OUT OF OR RELATED
TO THIS AGREEMENT OR THE COLLATERAL TO THE FULL EXTENT PERMITTED BY LAW.

 

24. This Agreement may be executed by different parties hereto on any number of
separate counterparts, each of which, when so executed and delivered, shall be
an original, and all such counterparts shall together constitute one and the
same instrument. Delivery of an executed signature page by telecopy or
electronic signature delivery system (in either case in a form

 

- 17 -

--------------------------------------------------------------------------------

acceptable to the Collateral Trustee) shall be effective as delivery of a
manually executed signature page to this Agreement.

 

25. In the event that any of the Collateral hereunder is also subject to a valid
and enforceable Lien under the terms of any Mortgage and the terms of such
Mortgage are inconsistent with the terms of this Agreement, then with respect to
such Collateral, the terms of such Mortgage shall be controlling in the case of
fixtures and real estate leases, letting and licenses of, and contracts and
agreements relating to the lease of, real property, and the terms of this
Agreement shall be controlling in the case of all other Collateral.

 

26. Notwithstanding anything to the contrary contained herein, to the extent
that the granting of a Lien by any Debtor to the Collateral Trustee under this
Agreement in any instrument, permit, contract or agreement constituting part of
the Collateral is prohibited by the terms of the instrument, permit, contract or
agreement evidencing or creating such Collateral and thereby results in a breach
or default by such Debtor thereunder or the termination thereof (in either case,
except to the extent that such prohibitions or terminations are rendered
ineffective by the Code), the Collateral shall not include, and shall exclude,
such instrument, permit, contract or agreement. The Collateral Trustee on behalf
of the Secured Parties acknowledges that consents may be required under certain
of the instruments, permits, contracts, and agreements constituting a part of
the Collateral in connection with any attempt to assign such instruments,
permits, contracts or agreements pursuant to the assertion of remedies
hereunder.

 

27. The parties agree that in the event of any conflict between the provisions
of this Agreement and the provisions of the Collateral Trust Agreement, the
provisions of the Collateral Trust Agreement shall control. Notwithstanding any
provision in this Agreement to the contrary, the parties and signatories hereto
acknowledge and agree that any and all rights, powers, privileges, duties,
responsibilities, liabilities and/or obligations (including but not limited to
the right to grant or withhold consent and the right to act or refrain from
acting), whether discretionary or mandatory, are and shall be exercised by the
Collateral Trustee solely in accordance with the terms and conditions of the
Collateral Trust Agreement, at the direction of the Credit Facility Agent (as
defined in the Collateral Trust Agreement) or other entity specified in the
Collateral Trust Agreement as having the right to give direction to the
Collateral Trustee, and subject further to the rights of the Collateral Trustee
to require officers’ certificate(s), opinion(s) and advice from counsel,
accountants, appraisers and other third parties, advancement of expenses and/or
assurances of indemnity satisfactory to the Collateral Trustee.

 

[SIGNATURE PAGE FOLLOWS]

 

- 18 -

--------------------------------------------------------------------------------

[SIGNATURE PAGE - SECURITY AGREEMENT]

 

IN WITNESS WHEREOF, the parties hereto, by their officers thereunto duly
authorized, have executed and delivered this Agreement as of the day and year
first above written.

 

CONSOL ENERGY INC.

By:

     

(SEAL)

Name:

   

Title:

   

 

[INSERT GUARANTORS]

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE - SECURITY AGREEMENT]

 

WILMINGTON TRUST COMPANY, as Collateral Trustee

By:

   

Name:

   

Title:

   

 

--------------------------------------------------------------------------------

SCHEDULE A

TO

SECURITY AGREEMENT

 

DEBTOR

--------------------------------------------------------------------------------

  

PRINCIPAL PLACE
OF BUSINESS
ADDRESS

--------------------------------------------------------------------------------

   FEIN

--------------------------------------------------------------------------------

   ORG ID
NUMBER

--------------------------------------------------------------------------------

  

STATE OF
FORMATION

--------------------------------------------------------------------------------

  

FORM OF
ORGANIZATION

--------------------------------------------------------------------------------

  

MINING AND DRILLING
OPERATIONS

--------------------------------------------------------------------------------

CONSOL Energy Inc.

(Delaware corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   51-0337383    2277631    Delaware    Corporation     

Cardinal States

Gathering Company

(Virginia general

partnership)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   73-1394037    None    Virginia   

General

Partnership

   1) Drilling/Pipeline Operations – Tazewell County, VA; Buchanan County, VA;
Russell County, VA; McDowell County, WV; Wyoming County, WV; Mingo County, WV;
Pike County, KY

Central Ohio Coal

Company

(Ohio corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   31-4356096    192806    Ohio    Corporation     

Church Street Holdings,

Inc.

(Delaware corporation)

  

300 Delaware Avenue

Suite 567

Wilmington, DE

19801-1622

   51-0335967    2273104    Delaware    Corporation     

CNX Gas Company

LLC

(Virginia limited

liability company)

  

US Route 460

North Tazewell, VA

24630

   31-1782401    S063789    Virginia   

Limited Liability

Company

  

1) Blacksville #2 Mine and Associated Facilities – Greene County, PA; Monongalia
County, WV

 

2) Blacksville #3 Reserve – Greene County, PA; Monongalia County, WV

 

3) Buchanan Mine and Associated Facilities – Buchanan County, VA

 

--------------------------------------------------------------------------------

DEBTOR

--------------------------------------------------------------------------------

  

PRINCIPAL PLACE
OF BUSINESS
ADDRESS

--------------------------------------------------------------------------------

   FEIN

--------------------------------------------------------------------------------

   ORG ID
NUMBER

--------------------------------------------------------------------------------

  

STATE OF
FORMATION

--------------------------------------------------------------------------------

  

FORM OF
ORGANIZATION

--------------------------------------------------------------------------------

  

MINING AND DRILLING
OPERATIONS

--------------------------------------------------------------------------------

                             

4) Hurricane Branch Reserve – Buchanan County, VA; Russell County, VA; Tazewell
County, VA

 

5) Loveridge Mine and Associated Facilities – Marion County, WV; Monongalia
County; WV; Wetzel County, WV

 

6) Marshall County Reserve – Marshall County, WV

 

7) McElroy Mine and Associated Facilities – Marshall County, WV

 

8) Nailer Reserve – Marion County, WV

 

9) Robinson Run Mine and Associated Facilities – Marion County, WV; Harrison
County, WV; Wetzel County, WV

 

10) St. Cloud Reserve – Monongalia County, WV; Wetzel County, WV

 

11) Shoemaker Mine and Associated Facilities – Marshall County, WV; Ohio County,
WV; Washington County, PA

 

12) Tetrick Reserve – Doddridge County, WV; Harrison County, WV; Marion County,
WV

 

--------------------------------------------------------------------------------

DEBTOR

--------------------------------------------------------------------------------

  

PRINCIPAL PLACE
OF BUSINESS
ADDRESS

--------------------------------------------------------------------------------

   FEIN

--------------------------------------------------------------------------------

   ORG ID
NUMBER

--------------------------------------------------------------------------------

  

STATE OF
FORMATION

--------------------------------------------------------------------------------

  

FORM OF
ORGANIZATION

--------------------------------------------------------------------------------

  

MINING AND DRILLING
OPERATIONS

--------------------------------------------------------------------------------

                              13) Drilling/Pipeline Operations – Tazewell
County, VA; Buchanan County, VA; Russell County, VA; McDowell County, VA

CNX Land Resources

Inc.

(Delaware corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   25-1871851    3289727    Delaware    Corporation     

CNX Marine Terminals Inc.

(Delaware corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   25-1385259    0896003    Delaware    Corporation   

1) Baltimore Terminal – Baltimore County, MD

 

2) Danville Reserve – Vermilion County, IL; Edgar County, IL

 

3) Fallowfield Reserve – Washington County, PA

Conrhein Coal

Company

(Pennsylvania general

partnership)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   25-1406541    2148694    Pennsylvania   

General

Partnership

  

1) Bailey Mine and Associated Facilities – Marshall County, WV; Greene County,
PA; Washington County, PA

 

2) Berkshire Reserve – Washington County, PA

 

3) Enlow Fork Mine and Associated Facilities – Marshall County, WV; Greene
County, PA; Washington County, PA

Consol Docks Inc.

(Delaware corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   25-1693670    2311445    Delaware    Corporation    1) Alicia Dock Facility –
Fayette County, PA

 

--------------------------------------------------------------------------------

DEBTOR

--------------------------------------------------------------------------------

  

PRINCIPAL PLACE
OF BUSINESS
ADDRESS

--------------------------------------------------------------------------------

   FEIN

--------------------------------------------------------------------------------

   ORG ID
NUMBER

--------------------------------------------------------------------------------

  

STATE OF
FORMATION

--------------------------------------------------------------------------------

  

FORM OF
ORGANIZATION

--------------------------------------------------------------------------------

  

MINING AND DRILLING
OPERATIONS

--------------------------------------------------------------------------------

CONSOL Financial Inc.

(Delaware corporation)

  

300 Delaware Avenue

Suite 567

Wilmington, DE

19801-1622

   51-0395375    3131765    Delaware    Corporation     

CONSOL of Canada

Inc.

(Delaware corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   98-0013773    0678608    Delaware    Corporation     

CONSOL of Kentucky

Inc.

(Delaware corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   94-2524120    0860789    Delaware    Corporation   

1) Jones Fork Mine and Associated Facilities – Breathitt County, KY; Floyd
County, KY; Knott County, KY; Magoffin County, KY;

 

2) Mill Creek Mine and Associated Facilities – Knott County, KY; Letcher County,
KY; Pike County, KY

 

3) Miller Creek Reserve – Mingo County, WV

Consol Pennsylvania

Coal Company

(Delaware corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   25-1402386    0916505    Delaware    Corporation   

1) Alexander Reserve – Marshall County, WV

 

2) Bailey Mine and Associated Facilities – Marshall County, WV; Greene County,
PA; Washington County, PA

 

3) Berkshire Reserve – Washington County, PA

 

4) Danville Reserve – Vermilion County, IL; Edgar County, IL

 

--------------------------------------------------------------------------------

DEBTOR

--------------------------------------------------------------------------------

  

PRINCIPAL PLACE
OF BUSINESS
ADDRESS

--------------------------------------------------------------------------------

   FEIN

--------------------------------------------------------------------------------

   ORG ID
NUMBER

--------------------------------------------------------------------------------

  

STATE OF
FORMATION

--------------------------------------------------------------------------------

  

FORM OF
ORGANIZATION

--------------------------------------------------------------------------------

  

MINING AND DRILLING
OPERATIONS

--------------------------------------------------------------------------------

                             

5) Enlow Fork Mine and Associated Facilities – Marshall County, WV; Greene
County, PA; Washington County, PA

 

6) Greene Hill Reserve – Greene County, PA

 

7) Marshall County Reserve – Marshall County, WV

Consol Sales Company

(Delaware corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   25-1670342    2277880    Delaware    Corporation     

CONSOLIDATION

COAL COMPANY

(Delaware corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   13-2566594    0633910    Delaware    Corporation   

1) Amonate Mine and Associated Facilities – Tazewell County, VA; Buchanan
County, VA; McDowell County, VA

 

2) Bailey Mine and Associated Facilities – Marshall County, WV; Greene County,
PA; Washington County, PA

 

3) Blacksville #2 Mine and Associated Facilities – Greene County, PA; Monongalia
County, WV

 

4) Blacksville #3 Reserve – Greene County, PA; Monongalia County, WV

 

--------------------------------------------------------------------------------

DEBTOR

--------------------------------------------------------------------------------

  

PRINCIPAL PLACE
OF BUSINESS
ADDRESS

--------------------------------------------------------------------------------

   FEIN

--------------------------------------------------------------------------------

   ORG ID
NUMBER

--------------------------------------------------------------------------------

  

STATE OF
FORMATION

--------------------------------------------------------------------------------

  

FORM OF
ORGANIZATION

--------------------------------------------------------------------------------

  

MINING AND DRILLING
OPERATIONS

--------------------------------------------------------------------------------

                             

5) Berkshire Reserve – Washington County, PA

 

6) Buchanan Mine and Associated Facilities – Buchanan County, VA

 

7) Emery Mine and Associated Facilities – Emery County, UT

 

8) Enlow Fork Mine and Associated Facilities – Marshall County, WV; Greene
County, PA; Washington County, PA

 

9) Fallowfield Reserve – Washington County, PA

 

10) Hurricane Branch Reserve – Buchanan County, VA; Russell County, VA; Tazewell
County, VA

 

11) Loveridge Mine and Associated Facilities – Marion County, WV; Monongalia
County, WV; Greene County, PA

 

12) Mahoning Valley Mine and Associated Facilities – Harrison County, OH;
Belmont County, OH

 

13) Marshall County Reserve – Marshall County, WV

 

14) McElroy Mine and Associated Facilities – Marshall County, WV

 

--------------------------------------------------------------------------------

DEBTOR

--------------------------------------------------------------------------------

  

PRINCIPAL PLACE
OF BUSINESS
ADDRESS

--------------------------------------------------------------------------------

   FEIN

--------------------------------------------------------------------------------

   ORG ID
NUMBER

--------------------------------------------------------------------------------

  

STATE OF
FORMATION

--------------------------------------------------------------------------------

  

FORM OF
ORGANIZATION

--------------------------------------------------------------------------------

  

MINING AND DRILLING
OPERATIONS

--------------------------------------------------------------------------------

                             

15) Nailer Reserve – Marion County, WV

 

16) Otter Creek Reserve – Powder River County, MT

 

17) Rend Lake Mine and Associated Facilities – Jefferson County, IL

 

18) Robinson Run Mine and Associated Facilities – Marion County, WV; Harrison
County, WV; Wetzel County, WV

 

19) Shoemaker Mine and Associated Facilities – Marshall County, WV; Ohio County,
WV; Washington County, PA

 

20) St. Cloud Reserve – Monongalia County, WV; Wetzel County, WV

 

21) St. Leo Reserve – Marion County, WV; Monongalia County, WV; Wetzel County,
WV

 

22) Tetrick Reserve – Doddridge County, WV; Harrison County, WV; Marion County,
WV

 

--------------------------------------------------------------------------------

DEBTOR

--------------------------------------------------------------------------------

  

PRINCIPAL PLACE
OF BUSINESS
ADDRESS

--------------------------------------------------------------------------------

   FEIN

--------------------------------------------------------------------------------

   ORG ID
NUMBER

--------------------------------------------------------------------------------

  

STATE OF
FORMATION

--------------------------------------------------------------------------------

  

FORM OF
ORGANIZATION

--------------------------------------------------------------------------------

  

MINING AND DRILLING
OPERATIONS

--------------------------------------------------------------------------------

Eighty-Four Mining

Company

(Pennsylvania

corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   25-1695903    2159331    Pennsylvania    Corporation    1) Mine 84 and
Associated Facilities – Washington County, PA

Greene Energy LLC

(Pennsylvania limited

liability company)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   74-2982015    2984574    Pennsylvania   

Limited Liability

Company

    

Helvetia Coal Company

(Pennsylvania

corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   25-1180531    158191    Pennsylvania    Corporation     

IC Coal, Inc.

(Delaware corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   95-2917408    2361849    Delaware    Corporation     

ISLAND CREEK

COAL COMPANY

(Delaware corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   55-0479426    0666523    Delaware    Corporation   

1) Holden Reserve – Logan County, WV; Mingo County, WV

 

2) Mine 84 and Associated Facilities – Washington County, PA

 

3) VP3 Mine and Associated Facilities – Buchanan County, VA

 

4) VP8 Mine and Associated Facilities – Buchanan County, VA

 

--------------------------------------------------------------------------------

DEBTOR

--------------------------------------------------------------------------------

  

PRINCIPAL PLACE
OF BUSINESS
ADDRESS

--------------------------------------------------------------------------------

   FEIN

--------------------------------------------------------------------------------

   ORG ID
NUMBER

--------------------------------------------------------------------------------

  

STATE OF
FORMATION

--------------------------------------------------------------------------------

  

FORM OF
ORGANIZATION

--------------------------------------------------------------------------------

  

MINING AND DRILLING
OPERATIONS

--------------------------------------------------------------------------------

Jeffco Coal Company

(Pennsylvania

corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   25-1383924    708571    Pennsylvania    Corporation     

Keystone Coal Mining

Corporation

(Pennsylvania

corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   25-1323822    654874    Pennsylvania    Corporation     

Laurel Run Mining

Company

(Virginia corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   54-0892422    130315    Virginia    Corporation   

1) Holden Reserve – Logan County, WV; Mingo County, WV

 

2) Mine 84 and Associated Facilities – Washington County, PA

Leatherwood, Inc.

(Pennsylvania

corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   25-1604505    1504884    Pennsylvania    Corporation     

McELROY COAL

COMPANY

(Delaware corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   25-1553551    2129034    Delaware    Corporation    1) McElroy Mine and
Associated Facilities – Marshall County, WV

MTB Inc.

(Delaware corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   25-1674211    2283880    Delaware    Corporation     

New Century Holdings,

Inc.

(Delaware corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   51-0344312    2317534    Delaware    Corporation     

 

--------------------------------------------------------------------------------

DEBTOR

--------------------------------------------------------------------------------

  

PRINCIPAL PLACE
OF BUSINESS
ADDRESS

--------------------------------------------------------------------------------

   FEIN

--------------------------------------------------------------------------------

   ORG ID
NUMBER

--------------------------------------------------------------------------------

  

STATE OF
FORMATION

--------------------------------------------------------------------------------

  

FORM OF
ORGANIZATION

--------------------------------------------------------------------------------

  

MINING AND DRILLING
OPERATIONS

--------------------------------------------------------------------------------

QUARTO MINING

COMPANY

(Ohio corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   34-1048622    392201    Ohio    Corporation     

RESERVE COAL

PROPERTIES

COMPANY

(Delaware corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   25-1582519    2170386    Delaware    Corporation   

1) Alexander Reserve – Marshall County, WV

 

2) Amonate Mine and Associated Facilities – Tazewell County, VA; McDowell
County, WV

 

3) Bailey Mine and Associated Facilities – Marshall County, WV; Greene County,
PA; Washington County, PA

 

4) Blacksville #3 Reserve – Greene County, PA; Monongalia County, WV

 

5) Buchanan Mine and Associated Facilities – Buchanan County, VA

 

6) Clark County Reserve – Clark County, IL

 

7) Danville Reserve – Vermilion County, IL; Edgar County, IL

 

8) Enlow Fork Mine and Associated Facilities – Marshall County, WV; Greene
County, PA; Washington County, PA

 

9) Fallowfield Reserve – Washington County, PA

 

--------------------------------------------------------------------------------

DEBTOR

--------------------------------------------------------------------------------

  

PRINCIPAL PLACE
OF BUSINESS
ADDRESS

--------------------------------------------------------------------------------

   FEIN

--------------------------------------------------------------------------------

   ORG ID
NUMBER

--------------------------------------------------------------------------------

  

STATE OF
FORMATION

--------------------------------------------------------------------------------

  

FORM OF
ORGANIZATION

--------------------------------------------------------------------------------

  

MINING AND DRILLING
OPERATIONS

--------------------------------------------------------------------------------

                             

 

10) Hamilton County Reserve – Hamilton County, IL; Saline County, IL; Franklin
County, IL

 

11) Hurricane Branch Reserve – Buchanan County, VA; Russell County, VA; Tazewell
County, VA

 

12) Loveridge Mine and Associated Facilities – Marion County, WV; Monongalia
County, WV; Wetzel County, WV

 

13) Mine 84 and Associated Facilities – Washington County, PA

 

14) Otter Creek Reserve – Powder River County, MT

 

15) Robinson Run Mine and Associated Facilities – Marion County, WV; Harrison
County, WV; Wetzel County, WV

 

16) St. Cloud Reserve – Monongalia County, WV; Wetzel County, WV

 

17) Shaner Reserve – Allegheny County, PA; Westmoreland County, PA

 

18) Tetrick Reserve – Doddridge County, WV; Harrison County, WV; Marion County,
WV

 

--------------------------------------------------------------------------------

DEBTOR

--------------------------------------------------------------------------------

  

PRINCIPAL PLACE
OF BUSINESS
ADDRESS

--------------------------------------------------------------------------------

   FEIN

--------------------------------------------------------------------------------

   ORG ID
NUMBER

--------------------------------------------------------------------------------

  

STATE OF
FORMATION

--------------------------------------------------------------------------------

  

FORM OF
ORGANIZATION

--------------------------------------------------------------------------------

  

MINING AND DRILLING
OPERATIONS

--------------------------------------------------------------------------------

                              19) Youngs Creek Reserve – Sheridan County, WY

Rochester & Pittsburgh

Coal Company

(Pennsylvania

corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   25-0761480    307678    Pennsylvania    Corporation     

SOUTHERN OHIO

COAL COMPANY

(West Virginia

corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   55-0403282    WV does
not issue
org. ID    West Virginia    Corporation     

Terra Firma Company

(West Virginia

corporation)

  

1000 Hampton Center

 

Morgantown, WV

26505

   20-0869908    WV does
not issue
org ID    West Virginia    Corporation     

THE WHITE STAR

COAL CO., INC.

(New York corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   25-1111594    NY does
not issue
org. ID    New York    Corporation     

TWIN RIVERS

TOWING COMPANY

(Delaware corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   25-1181155    0650101    Delaware    Corporation     

UNITED EASTERN

COAL SALES

CORPORATION

(Pennsylvania

corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   25-0849890    368920    Pennsylvania    Corporation     

 

--------------------------------------------------------------------------------

DEBTOR

--------------------------------------------------------------------------------

  

PRINCIPAL PLACE
OF BUSINESS
ADDRESS

--------------------------------------------------------------------------------

   FEIN

--------------------------------------------------------------------------------

   ORG ID
NUMBER

--------------------------------------------------------------------------------

  

STATE OF
FORMATION

--------------------------------------------------------------------------------

  

FORM OF
ORGANIZATION

--------------------------------------------------------------------------------

  

MINING AND DRILLING
OPERATIONS

--------------------------------------------------------------------------------

Windsor Coal Company

(West Virginia

corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   13-5488703    WV does
not issue
org. ID    West Virginia    Corporation     

WOLFPEN KNOB

DEVELOPMENT

COMPANY

(Virginia corporation)

  

Consol Plaza

1800 Washington Rd

Pittsburgh, PA 15241

   25-1391218    0211000    Virginia    Corporation    1) Birch Reserve –
Braxton County, WV; Clay County, WV; Nicholas County, WV

 

1. All of each Debtor’s personal property which has not been delivered to the
Collateral Trustee pursuant to the terms of this Agreement or the Credit
Agreement is now, and will be at all future times, located at such Debtor’s
chief executive office as described above opposite such Debtor’s name, except as
specified below.

 

2. All of each Debtor’s books and records, including those relating to accounts
payable and accounts receivable, are kept at such Debtor’s chief executive
office as described opposite such Debtor’s name, except as specified below.

 

3. Each Debtor uses no trade names or fictitious names.

 

--------------------------------------------------------------------------------

SCHEDULE B

TO

SECURITY AGREEMENT

 

COMMERCIAL TORT CLAIMS

 

None.

 

--------------------------------------------------------------------------------

Exhibit A to the

Security Agreement

 

EXHIBIT A

TO

SECURITY AGREEMENT

 

FORM OF ACCOUNT CONTROL AGREEMENT

(Deposit Account/Securities Account)

 

ACCOUNT CONTROL AGREEMENT (this “Agreement”) dated as of
                                             ,             , among (i)
                                                 , a
                                                                          (the
“Grantor”), (ii) Wilmington Trust Company, a Delaware banking corporation, not
in its individual capacity, but solely as Collateral Trustee under that certain
Collateral Trust Agreement dated as of [June]             , 2004 (the
“Collateral Trust Agreement”), among Wilmington Trust Company, as corporate
trustee, David A. Vanaskey, as individual trustee, CONSOL Energy Inc. and
certain of its subsidiaries party thereto, as secured party for the equal and
ratable benefit of the Secured Parties (as such term is defined in the
Collateral Trust Agreement) (the “Collateral Trustee”), and (iii)
                                        
                                        , a
                                        
                                        , as securities intermediary and
depository bank (the “Account Holder”).

 

PRELIMINARY STATEMENTS:

 

(1) The Grantor has granted the Collateral Trustee a security interest (the
“Security Interest”) in the following accounts maintained by the Account Holder
for the Grantor (each an “Account” and collectively, the “Accounts”):

 

[Insert account numbers and other identifying information.]

 

(2) Terms defined in Article 8 or 9 of the Uniform Commercial Code in effect in
the Commonwealth of Pennsylvania (“PA Uniform Commercial Code”) are used in this
Agreement as such terms are defined in such Article 8 or 9.

 

NOW, THEREFORE, in consideration of the premises and of the mutual agreements
contained herein, the parties hereto hereby agree as follows:

 

SECTION 1. The Accounts. The Grantor and Account Holder represent and warrant
to, and agree with, the Collateral Trustee that:

 

(a) The Account Holder maintains each Account for the Grantor, and all property
(including, without limitation, all funds and financial assets) held by the
Account Holder for the account of the Grantor are, and will continue to be,
credited to an Account in accordance with instructions given by the Grantor
(unless otherwise provided herein).

 

(b) To the extent that funds are credited to any Account, such Account is a
deposit account; and to the extent that financial assets are credited to any
Account, such

 

A-1

--------------------------------------------------------------------------------

Account is a securities account. The Account Holder is (i) the bank with which
each Account that is a deposit account is maintained and (ii) the securities
intermediary with respect to financial assets held in any Account that is a
securities account. The Grantor is (x) the Account Holder’s customer with
respect to the Accounts and (y) the entitlement holder with respect to financial
assets credited from time to time to any Account.

 

(c) Notwithstanding any other agreement to the contrary, the Account Holder’s
jurisdiction with respect to each Account for purposes of the PA Uniform
Commercial Code is, and will continue to be for so long as the Security Interest
shall be in effect, the Commonwealth of Pennsylvania.

 

(d) Attached as Exhibit A hereto are statements of the respective Accounts on
the most recent date practicable showing the property credited to each Account.

 

(e) The Grantor and Account Holder do not know of any claim to or interest in
any Account or any property (including, without limitation, funds and financial
assets) credited to any Account, except for claims and interests of the parties
referred to in this Agreement.

 

SECTION 2. Control by Collateral Trustee. Upon receipt of a Notice of Exclusive
Control (as defined below) and thereafter until receipt of a Notice of Release
(as defined below), the Account Holder will comply with (i) all instructions
directing disposition of the funds in any and all of the Accounts, (ii) all
notifications and entitlement orders that the Account Holder receives directing
it to transfer or redeem any financial asset in any and all of the Accounts, and
(iii) all other directions concerning any and all of the Accounts, including,
without limitation, directions to distribute to the Collateral Trustee proceeds
of any such transfer or redemption or interest or dividends on property in any
and all of the Accounts (any such instruction, notification or direction
referred to in clause (i), (ii) or (iii) above being an “Account Direction”), in
each case of clauses (i), (ii) and (iii) above originated by the Collateral
Trustee without further consent by the Grantor or any other Person.

 

SECTION 3. Grantor’s Rights in Accounts.

 

(a) Until the Account Holder receives a notice from the Collateral Trustee
certifying that an Event of Default (as defined in the security documents
between the Collateral Trustee and the Grantor) has occurred and is continuing
and stating that the Collateral Trustee will exercise exclusive control over any
Account (a “Notice of Exclusive Control” with respect to such Account), the
Account Holder will comply with Account Directions and other directions
concerning each Account originated by the Grantor without further consent by the
Collateral Trustee.

 

A-2

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(b) If the Account Holder receives from the Collateral Trustee a Notice of
Exclusive Control with respect to any Account, the Account Holder will, until a
Notice of Release (as defined below) is received by the Account Holder, comply
only with Account Directions originated by the Collateral Trustee and will
cease:

 

(i) complying with Account Directions or other directions concerning such
Account originated by the Grantor and

 

(ii) distributing to the Grantor interest and dividends on property (including,
without limitation, funds and financial assets) in such Account.

 

(c) In the event a Notice of Exclusive Control is delivered by the Collateral
Trustee to the Account Holder, and subsequently the Event of Default triggering
such notice is cured, the Collateral Trustee agrees promptly to send a notice to
the Account Holder directing the Account Holder to comply with Account
Directions and other directions concerning each Account originated by the
Grantor (a “Notice of Release”) and, at such time, the Account Holder will
comply with Account Directions as contemplated by clause (a).

 

SECTION 4. Priority of Collateral Trustee’s Security Interest. (a) The Account
Holder (i) subordinates to the Security Interest and in favor of the Collateral
Trustee any security interest, lien, or right of recoupment or setoff that it
may have, now or in the future, against any Account or property (including,
without limitation, any funds and financial assets) credited to any Account, and
(ii) agrees that it will not exercise any right in respect of any such security
interest or lien or any such right of recoupment or setoff until the Security
Interest is terminated, except that the Account Holder (A) will retain its prior
security interest and lien on property credited to any Account, (B) may exercise
any right in respect of such security interest or lien, and (C) may exercise any
right of recoupment or setoff against any Account, in the case of clauses (A),
(B) and (C) above, to secure or to satisfy, and only to secure and satisfy,
payment (x) for such property, (y) for its customary fees and expenses for the
routine maintenance and operation of such Account, and (z) if such Account is a
deposit account, for the face amount of any items that have been credited to
such Account but are subsequently returned unpaid because of uncollected or
insufficient funds.

 

(b) The Account Holder will not enter into any other agreement with any Person
relating to Account Directions or other directions with respect to any Account.

 

SECTION 5. Statements, Confirmations, and Notices of Adverse Claims. (a) The
Account Holder will send copies of all statements and confirmations for each
Account simultaneously to the Collateral Trustee and the Grantor.

 

(b) When the Account Holder knows of any claim or interest in any Account or any
property (including, without limitation, funds and financial assets) credited to
any Account other than the claims and interests of the parties referred to in
this Agreement, the Account Holder will promptly notify the Collateral Trustee
and the Grantor of such claim or interest.

 

SECTION 6. The Account Holder’s Responsibility. (a) Except for permitting a
withdrawal, delivery, or payment in violation of Section 3, the Account Holder
will not be liable to the Collateral Trustee for complying with Account
Directions or other directions concerning any Account from the Grantor that are
received by the Account Holder before the Account Holder receives and has a
reasonable opportunity to act on a Notice of Exclusive Control.

 

A-3

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(b) The Account Holder will not be liable to the Grantor or the Collateral
Trustee for complying with a Notice of Exclusive Control or with an Account
Direction or other direction concerning any Account originated by the Collateral
Trustee, even if the Grantor notifies the Account Holder that the Collateral
Trustee is not legally entitled to issue the Notice of Exclusive Control or
Account Direction or such other direction unless the Account Holder takes the
action after it is served with an injunction, restraining order, or other legal
process enjoining it from doing so, issued by a court of competent jurisdiction,
and had a reasonable opportunity to act on the injunction, restraining order or
other legal process.

 

(c) This Agreement does not create any obligation of the Account Holder except
for those expressly set forth in this Agreement and, in the case of any Account
that is a securities account, in Part 5 of Article 8 of the PA Uniform
Commercial Code and, in the case of any Account that is a deposit account, in
Article 4 of the PA Uniform Commercial Code. In particular, the Account Holder
need not investigate whether the Collateral Trustee is entitled under the
Collateral Trustee’s agreements with the Grantor to give an Account Direction or
other direction concerning any Account or a Notice of Exclusive Control. The
Account Holder may rely on notices and communications it believes given by the
appropriate party.

 

SECTION 7. Indemnity. The Grantor will indemnify the Account Holder, its
officers, directors, employees and agents against claims, liabilities and
expenses arising out of this Agreement (including, without limitation,
reasonable attorney’s fees and disbursements), except to the extent the claims,
liabilities or expenses are caused by the Account Holder’s gross negligence of
willful misconduct as found by a court of competent jurisdiction in a final,
non-appealable judgment.

 

SECTION 8. Termination; Survival. (a) The Collateral Trustee may terminate this
Agreement by notice to the Account Holder and the Grantor. If the Collateral
Trustee notifies the Account Holder that the Security Interest has terminated,
this Agreement will immediately terminate.

 

(b) The Account Holder may terminate this Agreement on 60 days’ prior notice to
the Collateral Trustee and the Grantor, provided that before such termination
the Account Holder and the Grantor shall make arrangements to transfer the
property (including, without limitation, all funds and financial assets)
credited to each Account to another Account Holder that shall have executed,
together with the Grantor, a control agreement in favor of the Collateral
Trustee in respect of such property in substantially the form of this Agreement
or otherwise in form and substance satisfactory to the Collateral Trustee.

 

(c) This Agreement shall terminate upon the satisfaction of the conditions set
forth in, and in accordance with the provisions of, Section 6 of the Collateral
Trust Agreement. The Collateral Trustee agrees to promptly give notice to the
Account Holder releasing all or any portion of the property (including, without
limitation, all or any portion of the funds and financial assets) held by the
Account Holder for the account of Grantor upon the satisfaction of the
conditions set forth in, and in accordance with the provisions of, Section 6 of
the Collateral Trust Agreement.

 

A-4

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(d) Sections 6 and 7 will survive termination of this Agreement.

 

SECTION 8. Governing Law. This Agreement shall be deemed to be a contract under
the laws of the Commonwealth of Pennsylvania and this Agreement and each Account
for all purposes shall be governed by and construed in accordance with the laws
of said Commonwealth without regard to its conflict of laws principles. The
Account Holder and the Grantor may not change the law governing any Account
without the Collateral Trustee’s express prior written agreement.

 

SECTION 9. Entire Agreement. This Agreement supersedes all prior understandings
and agreements, whether written or oral, between the parties hereto relating to
the transactions provided for herein.

 

SECTION 10. Amendments. No amendment of, or waiver of a right under, this
Agreement will be binding unless it is in writing and signed by the party to be
charged.

 

SECTION 11. Financial Assets. The Account Holder agrees with the Collateral
Trustee and the Grantor that, to the fullest extent permitted by applicable law,
all property (other than funds) credited from time to time to any Account will
be treated as financial assets under Article 8 of the PA Uniform Commercial
Code.

 

SECTION 12. Notices. A notice or other communication to a party under this
Agreement will be in writing (except that Account Directions may be given
orally), will be sent to the party’s address set forth under its name below or
to such other address as the party may notify the other parties. Any notice or
other communication shall be effective:

 

(i) In the case of hand-delivery, when delivered;

 

(ii) If given by mail, four days after such notice or other communication is
deposited with the United States Postal Service, with first-class postage
prepaid, return receipt requested;

 

(iii) In the case of a facsimile transmission, when sent to the applicable
party’s facsimile machine’s telephone number if the party sending such notice or
other communication receives confirmation of the delivery thereof from its own
facsimile machine;

 

(iv) In the case of electronic transmission, when actually received; and

 

(v) If given by any other means (including by overnight courier), when actually
received.

 

SECTION 13. Binding Effect. This Agreement shall be binding upon and inure to
the benefit of the Grantor, the Collateral Trustee and the Account Holder except
that the Grantor may not assign or transfer the Grantor’s obligations hereunder
or any interest herein other than assignments and transfers permitted by the
Credit Agreement dated as of                     , 2004 among CONSOL Energy
Inc., the Guarantors party thereto, the Lenders party thereto, LaSalle Bank

 

A-5

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National Association, Société Générale, New York Branch and SunTrust Bank, each
in its capacity as a co-documentation agent, and Citicorp North America, Inc.
and PNC Bank, National Association as co-administrative agents.

 

SECTION 14. Execution in Counterparts. This Agreement may be executed by
different parties hereto on any number of separate counterparts, each of which,
when so executed and delivered, shall be an original, and all such counterparts
shall together constitute one and the same instrument. Delivery of an executed
signature page by telecopy or electronic signature delivery system (in either
case in a form acceptable to the Collateral Trustee) shall be effective as
delivery of a manually executed signature page to this Agreement.

 

A-6

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective officers thereunto duly authorized, as of the date first
above written.

 

[NAME OF GRANTOR]

By        

Name:

   

Title:

Address:

       

Facsimile:

   

Email:

   

 

WILMINGTON TRUST COMPANY, not in its individual capacity but solely as
Collateral Trustee By        

Name:

   

Title:

Address:

    Wilmington Trust Company, as Collateral Trustee

Rodney Square North

1100 North Market Street

Wilmington, DE 19890

Attn:

 

Corporate Trust Administration

Telephone:

  (302) 636-6043

Facsimile:

  (302) 636-4143

Email:

   

 

--------------------------------------------------------------------------------

[NAME OF ACCOUNT HOLDER]

By        

Name:

   

Title:

Address:

               

Facsimile:

   

Email:

   

 

--------------------------------------------------------------------------------

EXHIBIT A

 

[Statements of the various Accounts showing the property credited to each
Account]

 

--------------------------------------------------------------------------------

Exhibit B to the

Security Agreement

 

EXHIBIT B

TO

SECURITY AGREEMENT

 

FORM OF SECURITIES ACCOUNT CONTROL AGREEMENT

 

SECURITIES ACCOUNT CONTROL AGREEMENT (this “Agreement”) dated as of
                                ,                 , among (i)
                                        , a
                                                  (the “Grantor”), (ii)
Wilmington Trust Company, a Delaware banking corporation, not in its individual
capacity, but solely as Collateral Trustee under that certain Collateral Trust
Agreement dated as of [June]     , 2004 (the “Collateral Trust Agreement”),
among Wilmington Trust Company, as corporate trustee, David A. Vanaskey, as
individual trustee, CONSOL Energy Inc. and certain of its subsidiaries party
thereto, as secured party for the equal and ratable benefit of the Secured
Parties (as such term is defined in the Collateral Trust Agreement) (the
“Collateral Trustee”), and (iii)                                         
            , a                                                      , as
securities intermediary (the “Securities Intermediary”).

 

PRELIMINARY STATEMENTS:

 

(1) The Grantor has granted the Collateral Trustee a security interest (the
“Security Interest”) in account no.              maintained by the Securities
Intermediary for the Grantor (the “Account”).

 

(2) Terms defined in Article 8 or 9 of the Uniform Commercial Code in effect in
the Commonwealth of Pennsylvania (“PA Uniform Commercial Code”) are used in this
Agreement as such terms are defined in such Article 8 or 9.

 

NOW, THEREFORE, in consideration of the premises and of the mutual agreements
contained herein, the parties hereto hereby agree as follows:

 

SECTION 1. The Account. The Grantor and Securities Intermediary represent and
warrant to, and agree with, the Grantor and the Collateral Trustee that:

 

(a) The Securities Intermediary maintains the Account for the Grantor, and all
property held by the Securities Intermediary for the account of the Grantor is,
and will continue to be, credited to the Account.

 

(b) The Account is a securities account. The Securities Intermediary is the
securities intermediary with respect to the property credited from time to time
to the Account. The Grantor is the entitlement holder with respect to the
property credited from time to time to the Account.

 

(c) The Commonwealth of Pennsylvania is, and will continue to be, the Securities
Intermediary’s jurisdiction of organization for purposes of Section 8-110(e) of
the UCC so long as the Security Interest shall remain in effect.

 

--------------------------------------------------------------------------------

(d) Exhibit A attached hereto is a statement of the property credited to the
Account on the most recent date practicable.

 

(e) The Grantor and Securities Intermediary do not know of any claim to or
interest in the Account or any property credited to the Account, except for
claims and interests of the parties referred to in this Agreement.

 

SECTION 2. Control by Collateral Trustee. Upon receipt of a Notice of Exclusive
Control (as defined below) and thereafter until receipt of a Notice of Release
(as defined below), the Securities Intermediary will comply with all
notifications it receives directing it to transfer or redeem any property in the
Account (each, and “Entitlement Order”) or other directions concerning the
Account (including, without limitation, directions to distribute to the
Collateral Trustee proceeds of any such transfer or redemption or interest or
dividends on property in the Account) originated by the Collateral Trustee
without further consent by the Grantor or any other person.

 

SECTION 3. Grantor’s Rights in Account.

 

(a) Until the Securities Intermediary receives a notice from the Collateral
Trustee certifying that an Event of Default (as defined in the security
documents between the Collateral Trustee and the Grantor) has occurred and is
continuing and stating that the Collateral Trustee will exercise exclusive
control over the Account (a “Notice of Exclusive Control” with respect to such
Account), the Securities Intermediary will comply with Entitlement Orders
originated by the Grantor without further consent by the Collateral Trustee.

 

(b) If the Securities Intermediary receives from the Collateral Trustee a Notice
of Exclusive Control, the Securities Intermediary, until it has received a
Notice of Release, will cease:

 

(i) complying with Entitlement Orders or other directions concerning the Account
originated by the Grantor and

 

(ii) distributing to the Grantor interest and dividends on property in the
Account.

 

(c) In the event a Notice of Exclusive Control is delivered by the Collateral
Trustee to the Securities Intermediary, and subsequently the Event of Default
triggering such notice is cured, the Collateral Trustee agrees promptly to send
a notice to the Securities Intermediary directing the Securities Intermediary to
comply with Entitlement Orders and other directions concerning each Account
originated by the Grantor (a “Notice of Release”) and, at such time, the Account
Holder will comply with Entitlement Orders as contemplated by clause (a).

 

SECTION 4. Priority of Collateral Trustee’s Security Interest. (a) The
Securities Intermediary subordinates in favor of the Collateral Trustee any
security interest, lien, or right of setoff it may have, now or in the future,
against the Account or property in the Account, except that the Securities
Intermediary will retain its prior lien on property in the Account to secure

 

B-2

--------------------------------------------------------------------------------

payment for property purchased for the Account and normal commissions and fees
for the Account.

 

(b) The Securities Intermediary will not agree with any Person not party to this
Agreement that the Securities Intermediary will comply with Entitlement Orders
originated by such Person.

 

SECTION 5. Statements, Confirmations, and Notices of Adverse Claims. (a) The
Securities Intermediary will send copies of all statements and confirmations for
the Account simultaneously to the Grantor and the Collateral Trustee.

 

(b) When the Securities Intermediary knows of any claim or interest in the
Account or any property credited to the Account other than the claims and
interests of the parties referred to in this Agreement, the Securities
Intermediary will promptly notify the Collateral Trustee and the Grantor of such
claim or interest.

 

SECTION 6. The Securities Intermediary’s Responsibility. (a) Except for
permitting a withdrawal, delivery, or payment in violation of Section 3, the
Securities Intermediary will not be liable to the Collateral Trustee for
complying with Entitlement Orders or other directions concerning the Account
from the Grantor that are received by the Securities Intermediary before the
Securities Intermediary receives and has a reasonable opportunity to act on a
Notice of Exclusive Control.

 

(b) The Securities Intermediary will not be liable to the Grantor or the
Collateral Trustee for complying with a Notice of Exclusive Control or with an
Entitlement Order or other direction concerning the Account originated by the
Collateral Trustee, even if the Grantor notifies the Securities Intermediary
that the Collateral Trustee is not legally entitled to issue the Notice of
Exclusive Control or Entitlement Order or such other direction unless the
Securities Intermediary takes the action after it is served with an injunction,
restraining order, or other legal process enjoining it from doing so, issued by
a court of competent jurisdiction, and had a reasonable opportunity to act on
the injunction, restraining order or other legal process.

 

(c) This Agreement does not create any obligation of the Securities Intermediary
except for those expressly set forth in this Agreement and in Part 5 of Article
8 of the PA Uniform Commercial Code. In particular, the Securities Intermediary
need not investigate whether the Collateral Trustee is entitled under the
Collateral Trustee’s agreements with the Grantor to give an Entitlement Order or
other direction concerning the Account or a Notice of Exclusive Control. The
Securities Intermediary may rely on notices and communications it believes given
by the appropriate party.

 

SECTION 7. Indemnity. The Grantor will indemnify the Securities Intermediary,
its officers, directors, employees and agents against claims, liabilities and
expenses arising out of this Agreement (including, without limitation,
reasonable attorney’s fees and disbursements), except to the extent the claims,
liabilities or expenses are caused by the Securities Intermediary’s gross
negligence of willful misconduct as found by a court of competent jurisdiction
in a final, non-appealable judgment.

 

B-3

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SECTION 8. Termination; Survival. (a) The Collateral Trustee may terminate this
Agreement by notice to the Securities Intermediary and the Grantor. If the
Collateral Trustee notifies the Securities Intermediary that the Security
Interest has terminated, this Agreement will immediately terminate.

 

(b) The Securities Intermediary may terminate this Agreement on 60 days’ prior
notice to the Collateral Trustee and the Grantor, provided that before such
termination the Securities Intermediary and the Grantor shall make arrangements
to transfer the property in the Account to another securities intermediary that
shall have executed, together with the Grantor, a control agreement in favor of
the Collateral Trustee in respect of such property in substantially the form of
this Agreement or otherwise in form and substance satisfactory to the Collateral
Trustee.

 

(c) This Agreement shall terminate upon the satisfaction of the conditions set
forth in, and in accordance with the provisions of, Section 6 of the Collateral
Trust Agreement. The Collateral Trustee agrees to promptly give notice to the
Securities Intermediary releasing all or any portion of the property (including,
without limitation, all or any portion of the funds and financial assets) held
by the Securities Intermediary for the account of Grantor upon the satisfaction
of the conditions set forth in, and in accordance with the provisions of,
Section 6 of the Collateral Trust Agreement.

 

(d) Sections 6 and 7 will survive termination of this Agreement.

 

SECTION 9. Governing Law. This Agreement shall be deemed to be a contract under
the laws of the Commonwealth of Pennsylvania and this Agreement and the Account
for all purposes shall be governed by and construed in accordance with the laws
of said Commonwealth without regard to its conflict of laws principles. The
Securities Intermediary and the Grantor may not change the law governing the
Account without the Collateral Trustee’s express prior written agreement.

 

SECTION 10. Entire Agreement. This Agreement supersedes all prior understandings
and agreements, whether written or oral, between the parties hereto relating to
the transactions provided for herein.

 

SECTION 11. Amendments. No amendment of, or waiver of a right under, this
Agreement will be binding unless it is in writing and signed by the party to be
charged.

 

SECTION 12. Financial Assets. The Securities Intermediary agrees with the
Collateral Trustee and the Grantor that, to the fullest extent permitted by
applicable law, all property credited from time to time to the Account will be
treated as financial assets under Article 8 of the PA Uniform Commercial Code.

 

SECTION 13. Notices. A notice or other communication to a party under this
Agreement will be in writing (except that Entitlement Orders may be given
orally), will be sent to the party’s address set forth under its name below or
to such other address as the party may notify the other parties. Any notice or
other communication shall be effective:

 

(i) In the case of hand-delivery, when delivered;

 

B-4

--------------------------------------------------------------------------------

(ii) If given by mail, four days after such notice or other communication is
deposited with the United States Postal Service, with first-class postage
prepaid, return receipt requested;

 

(iii) In the case of a facsimile transmission, when sent to the applicable
party’s facsimile machine’s telephone number if the party sending such notice or
other communication receives confirmation of the delivery thereof from its own
facsimile machine;

 

(iv) In the case of electronic transmission, when actually received; and

 

(v) If given by any other means (including by overnight courier), when actually
received.

 

SECTION 14. Binding Effect. This Agreement shall be binding upon and inure to
the benefit of the Grantor, the Collateral Trustee and the Securities
Intermediary and their respective successors and assigns except that the Grantor
may not assign or transfer the Grantor’s obligations hereunder or any interest
herein other than assignments and transfers permitted by the Credit Agreement
dated as of             , 2004 among CONSOL Energy Inc., the Guarantors party
thereto, the Lenders party thereto, LaSalle Bank National Association, Société
Générale, New York Branch and SunTrust Bank, each in its capacity as a
co-documentation agent, and Citicorp North America, Inc. and PNC Bank, National
Association as co-administrative agents.

 

SECTION 15. Execution in Counterparts. This Agreement may be executed by
different parties hereto on any number of separate counterparts, each of which,
when so executed and delivered, shall be an original, and all such counterparts
shall together constitute one and the same instrument. Delivery of an executed
signature page by telecopy or electronic signature delivery system (in either
case in a form acceptable to the Collateral Trustee) shall be effective as
delivery of a manually executed signature page to this Agreement.

 

B-5

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective officers thereunto duly authorized, as of the date first
above written.

 

[NAME OF GRANTOR]

By        

Title:

Address:

   

Facsimile:

   

Email:

   

WILMINGTON TRUST COMPANY, not

in its individual capacity but solely as

Collateral Trustee

By    

   

Name:

   

Title:

Address:

Wilmington Trust Company, as Collateral

Trustee

Rodney Square North

1100 North Market Street

Wilmington, DE 19890

Attn: Corporate Trust Administration

Telephone: (302) 636-6043

Facsimile: (302) 636-4143

Email:

   

[NAME OF SECURITIES INTERMEDIARY]

By        

Title:

Address:

   

Facsimile:

   

Email:

   

 

--------------------------------------------------------------------------------

EXHIBIT A

 

[Statements of the various Accounts showing the property credited to each
Account]

 

--------------------------------------------------------------------------------

Exhibit C to the

Security Agreement

 

EXHIBIT C

TO

SECURITY AGREEMENT

 

FORM OF COMMODITY ACCOUNT CONTROL AGREEMENT

 

COMMODITY ACCOUNT CONTROL AGREEMENT (this “Agreement”) dated as of
                            ,                 , among (i)
                            , a                                              
(the “Grantor”), (ii) Wilmington Trust Company, a Delaware banking corporation,
not in its individual capacity, but solely as Collateral Trustee under that
certain Collateral Trust Agreement dated as of [June]     , 2004 (the
“Collateral Trust Agreement”), among Wilmington Trust Company, as corporate
trustee, David A. Vanaskey, as individual trustee, CONSOL Energy Inc. and
certain of its subsidiaries party thereto, as secured party for the equal and
ratable benefit of the Secured Parties (as such term is defined in the
Collateral Trust Agreement) (the “Collateral Trustee”), and (iii)
                                                 , a
                                                                 , as commodity
intermediary (the “Commodity Intermediary”).

 

PRELIMINARY STATEMENTS:

 

(1) The Grantor has granted the Collateral Trustee a security interest (the
“Security Interest”) in account no.              maintained by the Commodity
Intermediary for the Grantor (the “Account”).

 

(2) Terms defined in Article 8 or 9 of the Uniform Commercial Code in effect in
the Commonwealth of Pennsylvania (“PA Uniform Commercial Code”) are used in this
Agreement as such terms are defined in such Article 8 or 9.

 

NOW, THEREFORE, in consideration of the premises and of the mutual agreements
contained herein, the parties hereto hereby agree as follows:

 

SECTION 1. The Account. The Grantor and Commodity Intermediary represent and
warrant to, and agree with, the Grantor and the Collateral Trustee that:

 

(a) The Commodity Intermediary maintains the Account for the Grantor, and all
commodity contracts held by the Commodity Intermediary for the account of the
Grantor is, and will continue to be, carried in the Account.

 

(b) The Account is a commodity account. The Commodity Intermediary is the
commodity intermediary with respect to the commodity contracts credited from
time to time in the Account. The Grantor is the commodity customer with respect
to the commodity contracts credited from time to time in the Account.

 

(c) The Commonwealth of Pennsylvania is, and will continue to be, the Commodity
Intermediary’s jurisdiction of organization for purposes of Section 9-305(b) of
the UCC so long as the Security Interest shall remain in effect.

 

--------------------------------------------------------------------------------

(d) Exhibit A attached hereto is a statement of the commodity contracts credited
in the Account on the most recent date practicable.

 

(e) The Grantor and Commodity Intermediary do not know of any claim to or
interest in the Account or any commodity contracts carried in the Account,
except for claims and interests of the parties referred to in this Agreement.

 

SECTION 2. Control by Collateral Trustee. Upon receipt of a Notice of Exclusive
Control (as defined below) and thereafter until receipt of a Notice of Release
(as defined below), the Commodity Intermediary will comply with all
notifications it receives directing it to apply any value distributed on account
of any commodity contract or contracts carried in the Account (each, and
“Entitlement Order”) or other directions concerning the Account originated by
the Collateral Trustee without further consent by the Grantor or any other
person.

 

SECTION 3. Grantor’s Rights in Account.

 

(a) Until the Commodity Intermediary receives a notice from the Collateral
Trustee certifying that an Event of Default (as defined in the security
documents between the Collateral Trustee and the Grantor) has occurred and is
continuing and stating that the Collateral Trustee will exercise exclusive
control over the Account (a “Notice of Exclusive Control” with respect to such
Account), the Commodity Intermediary will comply with Entitlement Orders
originated by the Grantor without further consent by the Collateral Trustee.

 

(b) If the Commodity Intermediary receives from the Collateral Trustee a Notice
of Exclusive Control, the Commodity Intermediary, until it has received a Notice
of Release, will cease:

 

(i) complying with Entitlement Orders or other directions concerning the Account
originated by the Grantor and

 

(ii) distributing to the Grantor any value distributed on account of any
commodity contract in the Account.

 

(c) In the event a Notice of Exclusive Control is delivered by the Collateral
Trustee to the Commodity Intermediary, and subsequently the Event of Default
triggering such notice is cured, the Collateral Trustee agrees promptly to send
a notice to the Commodity Intermediary directing the Commodity Intermediary to
comply with Entitlement Orders and other directions concerning each Account
originated by the Grantor (a “Notice of Release”) and, at such time, the Account
Holder will comply with Entitlement Orders as contemplated by clause (a).

 

SECTION 4. Priority of Collateral Trustee’s Security Interest. (a) The Commodity
Intermediary subordinates in favor of the Collateral Trustee any security
interest, lien, or right of setoff it may have, now or in the future, against
the Account or commodity contracts carried in the Account, except that the
Commodity Intermediary will retain its prior lien on commodity contracts in the
Account to secure payment for commodity contracts purchased for the Account and
normal commissions and fees for the Account.

 

C-2

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(b) The Commodity Intermediary will not agree with any third party that the
Commodity Intermediary will comply with Entitlement Orders originated by such
Person.

 

SECTION 5. Statements, Confirmations, and Notices of Adverse Claims. (a) The
Commodity Intermediary will send copies of all statements and confirmations for
the Account simultaneously to the Grantor and the Collateral Trustee.

 

(b) When the Commodity Intermediary knows of any claim or interest in the
Account or any commodity contracts credited in the Account other than the claims
and interests of the parties referred to in this Agreement, the Commodity
Intermediary will promptly notify the Collateral Trustee and the Grantor of such
claim or interest.

 

SECTION 6. The Commodity Intermediary’s Responsibility. (a) The Commodity
Intermediary will not be liable to the Collateral Trustee for complying with
Entitlement Orders or other directions concerning the Account from the Grantor
that are received by the Commodity Intermediary before the Commodity
Intermediary receives and has a reasonable opportunity to act on a Notice of
Exclusive Control.

 

(b) The Commodity Intermediary will not be liable to the Grantor for complying
with a Notice of Exclusive Control or with an Entitlement Order or other
direction concerning the Account originated by the Collateral Trustee, even if
the Grantor notifies the Commodity Intermediary that the Collateral Trustee is
not legally entitled to issue the Notice of Exclusive Control or Entitlement
Order or such other direction unless the Commodity Intermediary takes the action
after it is served with an injunction, restraining order, or other legal process
enjoining it from doing so, issued by a court of competent jurisdiction, and had
a reasonable opportunity to act on the injunction, restraining order or other
legal process.

 

(c) This Agreement does not create any obligation of the Commodity Intermediary
except for those expressly set forth in this Agreement. In particular, the
Commodity Intermediary need not investigate whether the Collateral Trustee is
entitled under the Collateral Trustee’s agreements with the Grantor to give an
Entitlement Order or other direction concerning the Account or a Notice of
Exclusive Control. The Commodity Intermediary may rely on notices and
communications it believes given by the appropriate party.

 

SECTION 7. Indemnity. The Grantor will indemnify the Commodity Intermediary, its
officers, directors, employees and agents against claims, liabilities and
expenses arising out of this Agreement (including, without limitation,
reasonable attorney’s fees and disbursements), except to the extent the claims,
liabilities or expenses are caused by the Commodity Intermediary’s gross
negligence of willful misconduct as found by a court of competent jurisdiction
in a final, non-appealable judgment.

 

SECTION 8. Termination; Survival. (a) The Collateral Trustee may terminate this
Agreement by notice to the Commodity Intermediary and the Grantor. If the
Collateral Trustee notifies the Commodity Intermediary that the Security
Interest has terminated, this Agreement will immediately terminate.

 

(b) The Commodity Intermediary may terminate this Agreement on 60 days’ prior
notice to the Collateral Trustee and the Grantor, provided that before such
termination the

 

C-3

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Commodity Intermediary and the Grantor shall make arrangements to transfer the
commodity contracts carried in the Account to another commodity intermediary
that shall have executed, together with the Grantor, a control agreement in
favor of the Collateral Trustee in respect of such commodity contracts in
substantially the form of this Agreement or otherwise in form and substance
satisfactory to the Collateral Trustee.

 

(c) This Agreement shall terminate upon the satisfaction of the conditions set
forth in, and in accordance with the provisions of, Section 6 of the Collateral
Trust Agreement. The Collateral Trustee agrees to promptly give notice to the
Commodity Intermediary releasing all or any portion of the property (including,
without limitation, all or any portion of the funds and financial assets) held
by the Commodity Intermediary for the account of Grantor upon the satisfaction
of the conditions set forth in, and in accordance with the provisions of,
Section 6 of the Collateral Trust Agreement.

 

(d) Sections 6 and 7 will survive termination of this Agreement.

 

SECTION 9. Governing Law. This Agreement shall be deemed to be a contract under
the laws of the Commonwealth of Pennsylvania and this Agreement and the Account
for all purposes shall be governed by and construed in accordance with the laws
of said Commonwealth without regard to its conflict of laws principles. The
Commodity Intermediary and the Grantor may not change the law governing the
Account without the Collateral Trustee’s express prior written agreement.

 

SECTION 10. Entire Agreement. This Agreement supersedes all prior understandings
and agreements, whether written or oral, between the parties hereto relating to
the transactions provided for herein.

 

SECTION 11. Amendments. No amendment of, or waiver of a right under, this
Agreement will be binding unless it is in writing and signed by the party to be
charged.

 

SECTION 12. Commodity Contracts. The Commodity Intermediary agrees with the
Collateral Trustee and the Grantor that, to the fullest extent permitted by
applicable law, all property carried from time to time in the Account will be
treated as commodity contracts under Article 8 of the PA Uniform Commercial
Code.

 

SECTION 13. Notices. A notice or other communication to a party under this
Agreement will be in writing (except that Entitlement Orders may be given
orally), will be sent to the party’s address set forth under its name below or
to such other address as the party may notify the other parties. Any notice or
other communication shall be effective:

 

(i) In the case of hand-delivery, when delivered;

 

(ii) If given by mail, four days after such notice or other communication is
deposited with the United States Postal Service, with first-class postage
prepaid, return receipt requested;

 

(iii) In the case of a facsimile transmission, when sent to the applicable
party’s facsimile machine’s telephone number if the party sending such notice or
other

 

C-4

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communication receives confirmation of the delivery thereof from its own
facsimile machine;

 

(iv) In the case of electronic transmission, when actually received; and

 

(v) If given by any other means (including by overnight courier), when actually
received.

 

SECTION 14. Binding Effect. This Agreement shall be binding upon and inure to
the benefit of the Grantor, the Collateral Trustee and the Commodity
Intermediary and their respective successors and assigns, except that the
Grantor may not assign or transfer the Grantor’s Obligations hereunder or any
interest herein other than assignments and transfers permitted by the Credit
Agreement dated as of             , 2004 among CONSOL Energy Inc., the
Guarantors party thereto, the Lenders party thereto, LaSalle Bank National
Association, Société Générale, New York Branch and SunTrust Bank, each in its
capacity as a co-documentation agent, and Citicorp North America, Inc. and PNC
Bank, National Association as co-administrative agents.

 

SECTION 15. Execution in Counterparts. This Agreement may be executed by
different parties hereto on any number of separate counterparts, each of which,
when so executed and delivered, shall be an original, and all such counterparts
shall together constitute one and the same instrument. Delivery of an executed
signature page by telecopy or electronic signature delivery system (in either
case in a form acceptable to the Collateral Trustee) shall be effective as
delivery of a manually executed signature page to this Agreement.

 

C-5

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective officers thereunto duly authorized, as of the date first
above written.

 

[NAME OF GRANTOR]

By        

Title:

Address:

   

Facsimile:

   

Email:

   

WILMINGTON TRUST COMPANY, not

in its individual capacity but solely as

Collateral Trustee

By    

   

Name:

   

Title:

Address:

Wilmington Trust Company, as Collateral

Trustee

Rodney Square North

1100 North Market Street

Wilmington, DE 19890

Attn: Corporate Trust Administration

Telephone: (302) 636-6043

Facsimile: (302) 636-4143

Email:

   

[NAME OF COMMODITY

INTERMEDIARY]

By        

Title:

Address:

   

Facsimile:

   

Email:

   

 

--------------------------------------------------------------------------------

EXHIBIT A

 

[Statements of the various Accounts showing the property credited to each
Account]

 

--------------------------------------------------------------------------------

EXHIBIT 1.1(S)(2)

 

FORM OF

SWING LOAN NOTE

 

$25,000,000

  Pittsburgh, Pennsylvania     June 30, 2004

 

FOR VALUE RECEIVED, the undersigned, CONSOL ENERGY INC., a Delaware corporation
(herein called the “Borrower”), hereby promises to pay to the order of PNC BANK,
NATIONAL ASSOCIATION (the “Bank”), on demand, the lesser of the principal sum of
TWENTY-FIVE MILLION U.S. Dollars (U.S. $25,000,000) or the aggregate unpaid
principal amount of all Swing Loans made by the Bank to the Borrower pursuant to
Section 2.1.2 of the Credit Agreement dated as of June 30, 2004, among the
Borrower, the Lenders party thereto, the Guarantors party thereto, LaSalle Bank
National Association, Société Générale, New York Branch and SunTrust Bank, each
in its capacity as a co-documentation agent, and Citibank North America, Inc.
and PNC Bank, National Association, in their capacity as co-administrative
agents for the Lenders (collectively, the “Co-Administrative Agents” and PNC
Bank, National Association, individually, as “Paying Agent”) (as it may
hereafter from time to time be amended, restated, modified or supplemented, the
“Credit Agreement”). All capitalized terms used herein shall, unless otherwise
defined herein, have the same meanings assigned to such terms in the Credit
Agreement.

 

The Borrower shall pay interest on the unpaid principal balance hereof from the
date hereof at the rate per annum provided in Section 4.1.3 of, or as otherwise
provided in, the Credit Agreement. Interest shall be due on the dates provided
in Section 5.3 of the Credit Agreement, or as otherwise provided therein.

 

After request for payment of any principal hereof or interest hereon shall have
been made by the Bank, or upon the occurrence and during the continuation of an
Event of Default, such amount shall thereafter bear interest at a rate per annum
as set forth in Section 4.3 of the Credit Agreement. Such interest will accrue
before and after any judgment has been entered with respect to this Swing Loan
Note and regardless whether or not any Event of Default has occurred and is
continuing.

 

Interest hereon will be payable at the times specified in the Credit Agreement.

 

Subject to the provisions of the Credit Agreement, payments of both principal
and interest shall be made without setoff, counterclaim or other deduction of
any nature at the office of the Paying Agent located at One PNC Plaza, 249 Fifth
Avenue, Pittsburgh, Pennsylvania 15222, in lawful money of the United States of
America in immediately available funds.

 

This Note is a Swing Loan Note referred to in, is subject to the provisions of,
and is entitled to the benefits of, the Credit Agreement and the other Loan
Documents, including the representations, warranties, covenants and conditions
contained or granted therein. This Swing

 

--------------------------------------------------------------------------------

Loan Note shall be payable on demand and regardless of whether or not an Event
of Default has occurred and is continuing.

 

Except as otherwise provided in the Credit Agreement, the Borrower waives
presentment, demand, notice, protest and all other demands and notices in
connection with the delivery, acceptance, performance, default or enforcement of
this Swing Loan Note and the Credit Agreement.

 

This Swing Loan Note shall bind the Borrower and its successors and assigns, and
the benefits hereof shall inure to the benefit of the Bank and its successors
and assigns; provided, that any assignment of this Swing Loan Note by the
Borrower or the Bank shall be subject to the provisions of Section 11.11 of the
Credit Agreement. All references herein to the “Borrower,” the “Paying Agent”
and the “Bank” shall be deemed to apply to the Borrower, the Paying Agent and
the Bank, respectively, and their respective successors and assigns.

 

This Swing Loan Note and any other documents delivered in connection herewith
and the rights and obligations of the parties hereto and thereto shall for all
purposes be governed by and construed and enforced in accordance with the
internal law of the Commonwealth of Pennsylvania without giving effect to its
conflict of laws principles.

 

[SIGNATURE PAGE FOLLOWS]

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE 1 OF 1 TO SWING LOAN NOTE]

 

IN WITNESS WHEREOF, the undersigned has executed this Swing Loan Note by its
duly authorized officer with the intention that it constitute a sealed
instrument.

 

CONSOL ENERGY INC.

By:    

Name:

   

Title:

   

 

[SEAL]

 

--------------------------------------------------------------------------------

EXHIBIT 2.5.1

 

FORM OF

LOAN REQUEST

 

LOAN REQUEST; RATE REQUEST

 

TO:   

PNC Bank, National Association, as Paying Agent

249 Fifth Avenue

Pittsburgh, Pennsylvania 15222

Telephone No.: (412) 762-2540

Telecopier No.: (412) 765-0984

Attention: Christopher N. Moravec

FROM:    CONSOL Energy Inc. (the “Borrower”) RE:    Credit Agreement (as it may
be amended, restated, modified or supplemented, the “Credit Agreement”), dated
as June 30, 2004, by and among CONSOL Energy Inc., a Delaware corporation, the
Guarantors party thereto, the Lenders party thereto, LaSalle Bank National
Association, Société Générale, New York Branch and SunTrust Bank, each in its
capacity as a co-documentation agent, and Citicorp North America, Inc. and PNC
Bank, National Association, as co-administrative agents for the Lenders,
(collectively, the “Co-Administrative Agents” and PNC Bank, National
Association, individually, as “Paying Agent”).

 

Capitalized terms not otherwise defined herein shall have the respective
meanings ascribed to them by the Credit Agreement.

 

A. Pursuant to Section 2.5.1 or 4.1.1 of the Credit Agreement, the undersigned
Borrower irrevocably requests [check one box under 1(a) below and fill in blank
space next to the box as appropriate]:

 

1.(a)

 

¨

   A new Revolving Credit Loan OR    

¨

   Renewal of the Euro-Rate Option applicable to an outstanding Revolving Credit
Loan originally made on                         ,              OR    

¨

   Conversion of the Base Rate Option applicable to an outstanding Revolving
Credit Loan originally made on                      to a Revolving Credit Loan
to which the Euro-Rate Option applies, OR    

¨

   Conversion of the Euro-Rate Option applicable to an outstanding Revolving
Credit Loan on                          ,              to a Revolving Credit
Loan to which the Base Rate Option applies.

 

--------------------------------------------------------------------------------

SUCH NEW, RENEWED OR CONVERTED REVOLVING CREDIT LOAN SHALL BEAR INTEREST:

 

[Check one box under 1(b) below and fill in blank spaces in line next to box]:

 

1.(b)(i)

 

¨

   Under the Base Rate Option. Such Loan shall have a Borrowing Date or interest
conversion date, as applicable, of                    ,              (which date
shall be (i) the same Business Day as the Business Day of receipt by the Agent
by 10:00 a.m. of this Loan Request for making a new Revolving Credit Loan to
which the Base Rate Option applies, or (ii) the last day of the preceding
Interest Period if a Revolving Credit Loan to which the Euro-Rate Option applies
is being converted to a Revolving Credit Loan to which the Base Rate Option
applies).          OR

(ii)

 

¨

   Under the Euro-Rate Option. Such Loan shall have a Borrowing Date or interest
conversion date, as applicable, of                         (which date shall be
no earlier than three (3) Business Days subsequent to the Business Day of
receipt by the Agent by 11:00 a.m. of this Loan Request for (i) making a new
Revolving Credit Loan to which the Euro-Rate Option applies or renewing a
Revolving Credit Loan to which the Euro-Rate Option applies, or (ii) converting
a Loan to which the Base Rate Option applies to a Revolving Credit Loan to which
the Euro-Rate Option applies.

2.

 

Such Loan is in the principal amount of U.S. $             or the principal
amount to be renewed or converted is U.S. $            

[not to be less than $5,000,000 and to be in increments of $1,000,000 if in
excess of $5,000,000 for each Borrowing Tranche to which the Euro-Rate Option
applies and not to be less than $500,000 or the maximum amount available for
Borrowing Tranches to which the Base Rate Option applies]

3.

 

[Complete blank below if the Borrower is selecting the Euro-Rate Option]:

Such Loan shall have an Interest Period of one, two, three or six Months.
                                

 

B. As of the date hereof and the date of making of the above-requested Revolving
Credit Loan (and after giving effect thereto): the Loan Parties have performed
and complied with all covenants and conditions of the Credit Agreement; all of
Loan Parties’ representations and warranties contained in Section 6 of the
Credit Agreement and in the other Loan Documents are true and correct (except
representations and warranties which expressly relate solely to an earlier date
or time, which representations and warranties were true and correct on and as of
the specific dates or times referred to therein); no Event of Default or
Potential Default has occurred and is continuing or shall exist; and the making
of such Loan shall not contravene any Law applicable to the Loan Parties.

 

2

--------------------------------------------------------------------------------

[REMAINDER OF PAGE LEFT BLANK INTENTIONALLY]

 

3

--------------------------------------------------------------------------------

[SIGNATURE PAGE TO LOAN REQUEST]

 

The undersigned certifies to the Paying Agent as to the accuracy of the
foregoing.

 

    CONSOL ENERGY INC. Date:  

                    , 20    

  By:            

Name:

           

Title:

   

 

--------------------------------------------------------------------------------

Exhibit 2.5.2

 

SWING LOAN REQUEST

 

TO:

  

PNC Bank, National Association, as Paying Agent

    

249 Fifth Avenue

    

Pittsburgh, Pennsylvania 15222

    

Telephone No.: (412) 762-2540

    

Telecopier No.: (412) 762-2571

    

Attention: Christopher N. Moravec

      

FROM:

  

CONSOL ENERGY INC., a Delaware corporation (the “Borrower”)

      

RE:

   Credit Agreement (as it may be amended, restated, modified or supplemented,
the “Credit Agreement”), dated as June 30, 2004, by and among the Borrower, each
of the Guarantors party to the Credit Agreement, the Lenders party to the Credit
Agreement, LaSalle Bank National Association, Société Générale, New York Branch
and SunTrust Bank, each in its capacity as a co-documentation agent, and
Citicorp North America, Inc. and PNC Bank, National Association, in their
capacity as co-administrative agents for the Lenders (collectively, the
“Co-Administrative Agents” and PNC Bank, National Association, individually as
“Paying Agent”).

 

Capitalized terms not otherwise defined herein shall have the respective
meanings given to them by the Agreement.

 

Pursuant to Section 2.5.2 of the Agreement, the Borrower hereby makes the
following Swing Loan Request:

 

1.    Aggregate Principal Amount of such Swing Loan (may not be less than
$100,000 and must be an integral multiple of $50,000)    U.S.
$                                                      2.   

Proposed Borrowing Date

(which date shall be on or after the date on which the Paying Agent receives
this Swing Loan Request, with such Swing Loan Request to be received no later
than 1:00 p.m. Pittsburgh Pennsylvania time on the Borrowing Date)

                                                                    

 

--------------------------------------------------------------------------------

3.    As of the date hereof and the date of making the above-requested Swing
Loan (and after giving effect thereto): the Borrower has performed and complied
with all covenants and conditions of the Agreement; all of the representations
and warranties contained in Section 6 of the Credit Agreement and in the other
Loan Documents are true and correct (except representations and warranties which
expressly relate solely to an earlier date or time, which representations and
warranties were true and correct on and as of the specific dates or times
referred to therein); no Event of Default or Potential Default has occurred and
is continuing or shall exist; the making of such Swing Loan shall not contravene
any Law applicable to the Borrower, any other Loan Party or any Lender.

 

[SIGNATURE PAGE FOLLOWS]

 

-2-

--------------------------------------------------------------------------------

[SIGNATURE PAGE 1 OF 1 TO SWING LOAN REQUEST]

 

The Borrower certifies to the Paying Agent for the benefit of the Lenders as to
the accuracy of the foregoing on                     , 20    .

 

CONSOL ENERGY INC. By:    

Name:

   

Title:

   

 

--------------------------------------------------------------------------------

EXHIBIT 7.1.4(A)

 

Matters to be covered in Opinions of Rowland H. Burns, Jr.,

Senior Counsel to the Loan Parties:

 

1. Organization and Qualification of each Loan Party (Section 6.1.1)

 

2. Capitalization and Ownership of each Loan Party that is a Subsidiary of the
Borrower (Section 6.1.3)

 

3. Power and Authority of each Loan Party regarding Loan Documents (Section
6.1.4)

 

4. No Conflict as to each Loan Party regarding Loan Documents (Section 6.1.6)
(other than as covered in the McGuireWoods and Piper Rudnick Opinions)

 

5. Litigation as to each Loan Party (Section 6.1.7)

 

6. Consents and Approvals as to each Loan Party (Section 6.1.13) (other than as
covered in the McGuireWoods and Piper Rudnick Opinions)

 

7. None of the Loan Parties is subject to regulation as an Investment Company or
Regulated Entity (Section 6.1.22)

 

8. Such other matters as the Co-Administrative Agents or the Lenders may
reasonably request

 

--------------------------------------------------------------------------------

EXHIBIT 7.1.4(B)

 

Matters to be covered in Opinions of McGuire Woods LLP, counsel to

the Loan Parties:

 

1. Validity and Binding Effect of each Loan Party regarding Loan Documents
(other than Mortgages and Deeds of Trust delivered by the Loan Parties) (Section
6.1.5)

 

2. Reasoned opinion that no Loan Party will have any legal or equitable interest
in Tranche B Credit-Linked Deposits; the Tranche B Credit-Linked Deposits will
not constitute property of the estate of a Loan Party under Bankruptcy Code §
541 in the event such Loan Party becomes a debtor under the Bankruptcy Code and
will not be subject to the automatic stay provided by Bankruptcy Code § 362(a)
or turnover under Bankruptcy Code § 542 in such event

 

3. No Conflict with Laws as to each Loan Party regarding Loan Documents (Section
6.1.6)

 

4. No contravention of Regulation U (Section 6.1.10)

 

5. Consents and Approvals as to each Loan Party with respect to Laws (Section
6.1.13)

 

6. Creation of Security Interests under Security Agreement, Pledge Agreement,
Patent, Trademark and Copyright Assignment and Ship Mortgage as to all Loan
Parties (Section 6.1.16)

 

7. Perfection of security interests as to each Loan Party (other than as to (i)
Loan Parties not formed in Pennsylvania or Delaware, (ii) as-extracted
collateral, (iii) the Mortgages and Deeds of Trust delivered by the Loan Parties
and (iv) the Ship Mortgage) (Section 6.1.16)

 

8. Such other matters as the Co-Administrative Agents or the Lenders may
reasonably request

 

--------------------------------------------------------------------------------

EXHIBIT 7.1.4(C)

 

Matters to be covered in Opinions of local counsel to the Loan Parties:

 

Peacock Keller & Eckler, LLP (Pennsylvania counsel)

 

1. Pennsylvania Mortgages and Fixture Filings in form sufficient for recording;
Pennsylvania Mortgages and Fixture Filings are enforceable and upon proper
recording and indexing, create valid, perfected liens and constitute notice to
third parties of the rights of the Mortgagee (Section 6.1.17)

 

2. Consents and Approvals as to Loan Parties with respect to the Pennsylvania
Mortgages (Section 6.1.13)

 

3. Sufficient Form of Financing Statements and Perfection as to Loan Parties
with as-extracted collateral in Pennsylvania (Section 6.1.16)

 

4. Such other matters as the Co-Administrative Agents or the Lenders may
reasonably request

 

Steptoe & Johnson, PLLC (West Virginia and Maryland counsel)

 

1. West Virginia Deeds of Trust, Mortgages and Fixture Filings in form
sufficient for recording; West Virginia Deeds of Trust, Mortgages and Fixture
Filings are enforceable and upon proper recording and indexing, create valid,
perfected liens and constitute notice to third parties of the rights of the
Mortgagee (Section 6.1.17)

 

2. Maryland Deed of Trust and Fixture Filing in forms sufficient for recording;
Maryland Deed of Trust and Fixture Filing are enforceable and create valid,
perfected liens (Section 6.1.17)

 

3. Consents and Approvals as to Loan Parties (a) formed in West Virginia, and
(b) with as-extracted collateral in West Virginia (Section 6.1.13)

 

4. Sufficient Form of Financing Statements and Perfection as to Loan Parties (a)
formed in West Virginia, and (b) with as-extracted collateral in West Virginia
(Section 6.1.16)

 

5. Perfection of Ship Mortgage (West Virginia)

 

6. Such other matters as the Co-Administrative Agents or the Lenders may
reasonably request

 

Combs & Isaac (Kentucky counsel)

 

1. Kentucky Deed of Trust, Mortgages and Fixture Filings in form sufficient for
recording; Kentucky Deed of Trust, Mortgages and Fixture Filings are enforceable
and upon proper recording and indexing, create valid, perfected liens and
constitute notice to third parties of the rights of the Mortgagee (Section
6.1.17)

 

--------------------------------------------------------------------------------

2. Consents and Approvals as to Loan Parties with respect to the Kentucky
Mortgages (Section 6.1.13)

 

3. Sufficient Form of Financing Statements and Perfection as to Loan Parties
with as-extracted collateral in Kentucky (Section 6.1.16)

 

4. Such other matters as the Co-Administrative Agents or the Lenders may
reasonably request

 

Altizer, Walk & White (Virginia counsel)

 

1. Virginia Deeds of Trust, Mortgages and Fixture Filings in form sufficient for
recording; Virginia Deeds of Trust, Mortgages and Fixture Filings are
enforceable and upon proper recording and indexing, create valid, perfected
liens and constitute notice to third parties of the rights of the Mortgagee
(Section 6.1.17)

 

2. Consents and Approvals as to Loan Parties with respect to the Virginia Deeds
of Trust (Section 6.1.13)

 

3. Sufficient Form of Financing Statements and Perfection as to Loan Parties (a)
formed in Virginia, and (b) with as-extracted collateral in Virginia (Section
6.1.16)

 

4. Such other matters as the Co-Administrative Agents or the Lenders may
reasonably request

 

Piper Rudnick LLP (Illinois counsel)

 

1. Illinois Mortgages and Fixture Filings in form sufficient for recording;
Illinois Mortgages and Fixture Filings are enforceable and upon proper recording
and indexing, create valid, perfected liens and constitute notice to third
parties of the rights of the Mortgagee (Section 6.1.17)

 

2. Consents and Approvals as to Loan Parties with respect to Illinois Mortgages
(Section 6.1.13)

 

3. Sufficient Form of Financing Statements and Perfection as to Loan Parties
with as-extracted collateral in Illinois (Section 6.1.16)

 

4. Such other matters as the Co-Administrative Agents or the Lenders may
reasonably request

 

Geoff Mosser (Ohio counsel)

 

1. Ohio Mortgages and Fixture Filings in form sufficient for recording; Ohio
Mortgages and Fixture Filings are enforceable and upon proper recording and
indexing, create valid, perfected liens and constitute notice to third parties
of the rights of the Mortgagee (Section 6.1.17)

 

--------------------------------------------------------------------------------

2. Consents and Approvals as to Loan Parties with respect to Ohio Mortgages
(Section 6.1.13)

 

3. Sufficient Form of Financing Statements and Perfection as to Loan Parties (a)
formed in Ohio, and (b) with as-extracted collateral in Ohio (Section 6.1.16)

 

4. Such other matters as the Co-Administrative Agents or the Lenders may
reasonably request

 

Stoel Rives (Utah counsel)

 

5. Utah Mortgages and Fixture Filings in form sufficient for recording; Utah
Mortgages and Fixture Filings are enforceable and upon proper recording and
indexing, create valid, perfected liens and constitute notice to third parties
of the rights of the Mortgagee (Section 6.1.17)

 

6. Consents and Approvals as to Loan Parties with respect to Utah Mortgages
(Section 6.1.13)

 

7. Sufficient Form of Financing Statements and Perfection as to Loan Parties
with as-extracted collateral in Utah (Section 6.1.16)

 

8. Such other matters as the Co-Administrative Agents or the Lenders may
reasonably request

 

Crowley Law Firm (Montana counsel)

 

1. Montana Mortgages and Fixture Filings in form sufficient for recording;
Montana Mortgages and Fixture Filings are enforceable and upon proper recording
and indexing, create valid, perfected liens and constitute notice to third
parties of the rights of the Mortgagee (Section 6.1.17)

 

2. Consents and Approvals as to Loan Parties with respect to Montana Mortgages
(Section 6.1.13)

 

3. Such other matters as the Co-Administrative Agents or the Lenders may
reasonably request

 

Hathaway & Kunz, PC (Wyoming counsel)

 

1. Wyoming Mortgages and Fixture Filings in form sufficient for recording;
Wyoming Mortgages and Fixture Filings are enforceable and upon proper recording
and indexing, create valid, perfected liens and constitute notice to third
parties of the rights of the Mortgagee (Section 6.1.17)

 

2. Consents and Approvals as to Loan Parties with respect to Wyoming Mortgages
(Section 6.1.13)

 

3. Such other matters as the Co-Administrative Agents or the Lenders may
reasonably request

 

--------------------------------------------------------------------------------

EXHIBIT 7.1.4(D)

 

Matters to be covered in Opinions of Piper Rudnick LLP, bond counsel to the Loan
Parties:

 

1. Noncontravention as to each Loan Party regarding Loan Documents (Section
6.1.6) with the terms and provisions contained (i) in the 1991 Issuing and
Paying Agency Agreement, as amended and in all securities issued thereunder and
(ii) in the 2002 Indenture as amended or supplemented and in all securities
issued thereunder

 

2. Validity and Binding Effect of the Collateral Trust Agreement

 

3. Such other matters as the Co-Administrative Agents or the Lenders may
reasonably request

 

--------------------------------------------------------------------------------

Exhibit 7.1.15

 

SOLVENCY CERTIFICATE

 

This Solvency Certificate (the “Certificate”) is delivered pursuant to Section
7.1.15 of the Credit Agreement (as it may be amended, restated, modified or
supplemented, the “Credit Agreement”), dated as June 30, 2004, by and among
CONSOL Energy Inc., a Delaware corporation, each of the Guarantors party to the
Credit Agreement, the Lenders party to the Credit Agreement, LaSalle Bank
National Association, Société Générale, New York Branch and SunTrust Bank, each
in its capacity as a co-documentation agent, and Citicorp North America, Inc.
and PNC Bank, National Association, in their capacity as co-administrative
agents for the Lenders (collectively, the “Co-Administrative Agents” and PNC
Bank, National Association, individually, as “Paying Agent”). Unless otherwise
defined herein, terms used herein have the meanings provided in the Credit
Agreement.

 

Each of the undersigned hereby certifies that he is a Responsible Officer of the
Loan Party for which such Responsible Officer is executing this Certificate and
that, as such, he is authorized to execute this Certificate on behalf of such
Loan Party. Each Responsible Officer further certifies that:

 

(a) The Responsible Officer has knowledge of the Credit Agreement and the other
Loan Documents.

 

(b) The Responsible Officer is familiar with the finances of the Loan Parties
and the financial statements, if any, of the Loan Parties. The Responsible
Officer has also participated in the development of Financial Projections.

 

(c) Based upon the foregoing, as of the Closing Date and after giving effect to
the transactions contemplated by the Loan Documents, including the Loans to be
made and the Letters of Credit to be issued on the Closing Date, it is the
Responsible Officer’s belief that:

 

(i) the fair value of the property of the Loan Parties, taken as a whole, will
exceed the total amount of liabilities (including, without limitation,
contingent liabilities) of the Loan Parties, taken as a whole;

 

(ii) the present fair salable value of the assets of the Loan Parties, taken as
a whole, will exceed the amount that will be required to pay the probable
liabilities of the Loan Parties, taken as a whole, on their debts as they become
absolute and matured;

 

(iii) the Loan Parties, taken as a whole, will be able to realize on their
assets and pay their debts and other liabilities, continent obligations and
other commitments as they mature in the normal course of business;

 

(iv) the Loan Parties, taken as a whole, do not intend to, and do not believe
that they will, incur debts or liabilities beyond the Loan Parties’ ability to
pay as such debts and liabilities mature; and

 

(v) the Loan Parties, taken as a whole, are not, and are not about to be,
engaged in a business or transaction for which their property would constitute

 

--------------------------------------------------------------------------------

unreasonably small capital, taken as a whole, after giving due consideration to
the prevailing practice in the industry in which the Loan Parties are engaged.

 

I understand that the Co-Administrative Agents, the Paying Agent and each of the
Lenders are relying on the truth and accuracy of the foregoing in connection
with its entering into the Credit Agreement and the other Loan Documents and the
consummation of the transactions contemplated thereby.

 

[SIGNATURE APPEARS ON THE FOLLOWING PAGE]

 

2

--------------------------------------------------------------------------------

[SIGNATURE PAGE TO SOLVENCY CERTIFICATE]

 

This Certificate is made as of the 30th day June, 2004.

 

CONSOL ENERGY INC. By:    

Name:

  John M. Reilly

Title:

  Treasurer CENTRAL OHIO COAL COMPANY CHURCH STREET HOLDINGS, INC. CONSOL
FINANCIAL INC. CONSOL OF CANADA INC. CONSOL OF KENTUCKY INC. CONSOL PENNSYLVANIA
COAL COMPANY CONSOLIDATION COAL COMPANY EIGHTY-FOUR MINING COMPANY

HELVETIA COAL COMPANY

IC COAL, INC.

ISLAND CREEK COAL COMPANY JEFFCO COAL COMPANY KEYSTONE COAL MINING CORPORATION
LAUREL RUN MINING COMPANY LEATHERWOOD, INC. McELROY COAL COMPANY NEW CENTURY
HOLDINGS, INC. QUARTO MINING COMPANY ROCHESTER & PITTSBURGH COAL COMPANY
SOUTHERN OHIO COAL COMPANY THE WHITE STAR COAL CO., INC. TWIN RIVERS TOWING
COMPANY UNITED EASTERN COAL SALES CORPORATION WINDSOR COAL COMPANY WOLFPEN KNOB
DEVELOPMENT COMPANY

By:

        John M. Reilly, Treasurer of each Loan Party listed above on behalf of
each such Loan Party

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE TO SOLVENCY CERTIFICATE]

 

CNX LAND RESOURCES INC.

MTB INC.

By:         William D. Stanhagen, President of each Loan Party listed above on
behalf of each such Loan Party

CNX MARINE TERMINALS INC.

CONSOL DOCKS INC.

By:         Ronald G. Stovash, President of each Loan Party listed above on
behalf of each such Loan Party CONSOL SALES COMPANY By:    

Name:

  Peter B. Lilly

Title:

  President RESERVE COAL PROPERTIES COMPANY By:    

Name:

  William D. Stanhagen

Title:

  President TERRA FIRMA COMPANY By:    

Name:

  James A. Russell

Title:

  President

 

--------------------------------------------------------------------------------

[SIGNATURE PAGE TO SOLVENCY CERTIFICATE]

 

CARDINAL STATES GATHERING COMPANY By:    

Name:

  Ronald E. Smith

Title:

  Management Representative CNX GAS COMPANY LLC By:    

Name:

  Ronald E. Smith

Title:

  President CONRHEIN COAL COMPANY By:    

Name:

  John M. Reilly

Title:

  Treasurer GREENE ENERGY LLC By:    

Name:

  Claude D. Morgan

Title:

  Manager

 

--------------------------------------------------------------------------------

EXHIBIT 8.2.6

 

FORM OF

 

ACQUISITION COMPLIANCE CERTIFICATE

 

                                    , 200    

 

PNC Bank, National Association, as Paying Agent

249 Fifth Avenue

Pittsburgh, Pennsylvania 15222-2707

 

Ladies and Gentlemen:

 

I refer to the Credit Agreement (as it may be amended, restated, modified or
supplemented from time to time, the “Credit Agreement”), dated as June 30, 2004,
by and among Consol Energy Inc., a Delaware corporation, each of the Guarantors
party to the Credit Agreement, the Lenders party to the Credit Agreement,
LaSalle Bank National Association, Société Générale, New York Branch and
SunTrust Bank, each in its capacity as a co-documentation agent, and Citicorp
North America, Inc. and PNC Bank, National Association, in their capacity as
co-administrative agents for the Lenders (collectively, the “Co-Administrative
Agents” and PNC Bank, National Association, individually, as “Paying Agent”).
Unless otherwise defined herein, terms defined in the Credit Agreement are used
herein with the same meanings. References herein to Sections of the Credit
Agreement are qualified, in their entirety, by the applicable provision of the
Section of the Credit Agreement so referred to and together with all related
provisions and definitions referred to in such Section or incorporated therein.

 

I,                                                  , [specify: Chief Executive
Officer/President/Chief Financial Officer/Treasurer] of the Borrower, do hereby
certify on behalf of the Borrower as of the [specify: fiscal quarter/fiscal year
ended                     , 20    ] as follows:

 

In connection with Section 8.2.6 of the Credit Agreement and with respect to a
proposed Permitted Acquisition by                      [name of Loan Party that
will be making the Permitted Acquisition] (the “Acquiring Company”) of
                     [specify: assets/stock] [specify: by purchase/by merger and
insert description of the transaction] (the “Acquisition”) of
                     [insert name of entity whose assets are/stock is being
acquired] (the “Target”).

 

The proposed date of the Acquisition is                      (the “Acquisition
Date”) [at least 5 Business Days after the date of this certificate].

 

The “Report Date” herein shall be the date of the most recent fiscal quarter
ended prior to the proposed Acquisition of the Target.

 

--------------------------------------------------------------------------------

PNC Bank, National Association, as Paying Agent

                                         , 200    

Page 2

 

1. The Target is engaged in              [describe business being acquired]
which complies with Section 8.2.10 of the Credit Agreement.

 

2. The Loan Parties are, and after giving effect to the Acquisition will be, in
compliance with Sections 8.2.17 and 8.2.18 of the Credit Agreement as more fully
set forth on Appendix A attached hereto.

 

3. The Leverage Ratio after giving effect to the Acquisition (see “Consolidated
Pro Forma” column on Appendix A attached hereto) is              to 1.00.

 

4. The total Consideration to be paid by the Loan Parties for such Acquisition,
including (i) cash paid by any of the Loan Parties, directly or indirectly, to
the seller in connection with the Acquisition, (ii) the Indebtedness, fixed or
contingent, incurred or assumed by any of the Loan Parties, whether in favor of
the seller or otherwise, (iii) any Guaranty given or incurred by any Loan Party
in connection with the Acquisition and (iv) any other consideration given or
obligation incurred by any of the Loan Parties in connection with the
Acquisition is $             [include as applicable: which amount is in excess
of $10,000,000 and, accordingly, pursuant to Section 8.2.6(3)(vii), the Borrower
contemporaneously herewith is delivering or has heretofore delivered to the
Paying Agent true, correct and complete copies of all agreements entered into or
proposed to be entered into by the Loan Parties in connection with the
Acquisition].

 

5. The aggregate of such total Consideration to be paid by the Loan Parties for
the Acquisition and for all other Permitted Acquisitions made on and after the
Closing Date to and including the Acquisition Date is $             [include the
following where pro forma Leverage Ratio, after taking into account the
Acquisition (see “Consolidated Pro Forma” column on Appendix A attached hereto),
is equal to or greater than 2.0 to 1.0: which does not exceed the permitted
amount of $100,000,000 pursuant to Section 8.2.6(3)(vi) of the Credit
Agreement].

 

6. The Borrower has, after giving effect to the Acquisition, $             of
Availability which is not less than the permitted amount of $50,000,000 pursuant
to Section 8.2.6(3)(vii) as more fully set forth on Appendix A attached hereto.

 

7. The Loan Parties, in order to consummate the Acquisition, have incurred or
will incur $             of Indebtedness, which Indebtedness is not greater than
$250,000,000 in the aggregate outstanding at any one time as permitted by
Section 8.2.1(viii)(b) of the Credit Agreement and provided that the terms and
conditions of any such Indebtedness must be reasonably acceptable to the Paying
Agent.

 

8. Attached hereto as Exhibit [_] are the [insert description of the financial
statements or other financial information of the Target] upon which the
calculations in this certificate with respect to the Target are based.

 

No Event of Default or Potential Default exists immediately prior to and after
giving effect to the Acquisition.

 

--------------------------------------------------------------------------------

PNC Bank, National Association, as Paying Agent

                    , 200    

Page 3

 

IN WITNESS WHEREOF, the undersigned has executed this Certificate this
             day of                     , 20    .

 

By:    

Name:

   

Title:

 

[Chief Executive Officer/

President/Chief Financial Officer/

Treasurer]

 

--------------------------------------------------------------------------------

APPENDIX A

 

Credit Agreement

--------------------------------------------------------------------------------

    

Consolidated for

Borrower and its

Subsidiaries

--------------------------------------------------------------------------------

     Target

--------------------------------------------------------------------------------

    

Consolidated

Pro Forma1

--------------------------------------------------------------------------------

1. Maximum Leverage Ratio (Section 8.2.17). The ratio of (a) Financial Covenant
Debt to (b) Consolidated EBITDA as of the Report Date is (line 1.(a)(xvi)
divided by line 1.(b)(xv)):

                    to 1.00                     to 1.00       
             to 1.00

which is not more than the maximum permitted ratio of 3.0 to 1.0

                          

(a) Financial Covenant Debt, determined as of the fiscal quarter of the Borrower
ending as of the Report Date, is computed as follows:

                          

(i) indebtedness for borrowed money

     $                           $                           $
                    

(ii) obligations evidenced by notes, bonds, debentures or similar instruments or
that bear interest

     $                           $                           $
                    

(iii) reimbursement and other obligations with respect to letters of credit and
bankers’ acceptances, whether or not matured

     $                           $                           $
                    

--------------------------------------------------------------------------------

1 All calculations are on a pro-forma basis, based upon the financial statements
of the Loan Parties as of the Report Date, after giving effect to the Permitted
Acquisition (i.e., if a financial covenant is measured for the immediately
preceding four fiscal quarters as of the Report Date, the financial results of
the Target as well as the Borrower and its Subsidiaries will be included in that
four fiscal quarter period calculation) and include in such calculations
Indebtedness or other liabilities assumed or incurred in connection with such
Permitted Acquisition and income earned or expenses incurred by the Target prior
to the date of the Permitted Acquisition)

 

-1-

--------------------------------------------------------------------------------

Credit Agreement

--------------------------------------------------------------------------------

    

Consolidated for

Borrower and its

Subsidiaries

--------------------------------------------------------------------------------

     Target

--------------------------------------------------------------------------------

    

Consolidated

Pro Forma1

--------------------------------------------------------------------------------

(iv) indebtedness for the deferred purchase price of property or services, other
than trade payables incurred in the ordinary course of business and payable in
accordance with customary practices that are not overdue for more than 90 days
unless contested in good faith and by appropriate proceedings if adequate
reserves in accordance with GAAP have been established and accrued expenses
incurred in the ordinary course of business

     $                           $                           $
                    

(v) indebtedness created or arising under any conditional sale or other title
retention agreements with respect to property acquired (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)

     $                           $                           $
                    

(vi) obligations under any capital leases (other than advance royalties under a
mineral lease)

     $                           $                           $
                    

(vii) obligations to purchase, redeem, retire, defease or otherwise acquire for
value any capital stock, other equity interest or Hybrid Securities valued, in
the case of redeemable preferred stock, at the greater of its voluntary
liquidation preference and its involuntary liquidation preference plus accrued
and unpaid dividends

     $                           $                           $
                    

(viii) indebtedness and other obligations in respect of the Permitted
Receivables Financing

     $                           $                           $
                    

 

1. See note 1 on prior page.

 

-2-

--------------------------------------------------------------------------------

Credit Agreement

--------------------------------------------------------------------------------

    

Consolidated for

Borrower and its

Subsidiaries

--------------------------------------------------------------------------------

     Target

--------------------------------------------------------------------------------

    

Consolidated

Pro Forma1

--------------------------------------------------------------------------------

(ix) reimbursement obligations, to the extent not included in item (iii) above,
under standby letters of credit (whether or not issued under the Credit
Agreement)

     $                           $                           $
                    

(x) non-contingent reimbursement obligations, to the extent not included in item
(iii) above, or other matured obligations with respect to Indebtedness of the
type specified in item (iii) above

     $                           $                           $
                    

(xi) the sum (without duplication) of items 1(a)(i) through 1(a)(x) equals

     $                           $                           $
                    

(xii) obligations under undrawn standby letters of credit (whether or not issued
under the Credit Agreement) issued with respect to performance obligations under
sales contracts, performance obligations with respect to mine reclamation,
performance obligations relating to black lung benefit liabilities and
performance obligations relating to workers compensation and other employee
benefit liabilities (but only to the extent that the foregoing is included in
the amount determined under item (xi) above)

     $                           $                           $
                    

(xiii) obligations under each other letter of credit in respect of which the
Borrower has provided Letter of Credit Support, but only in an amount equal to
such Letter of Credit Support (but only to the extent that the foregoing is
included in the amount determined under item (xi) above)

     $                           $                           $
                    

 

1. See note 1 on prior page.

 

-3-

--------------------------------------------------------------------------------

Credit Agreement

--------------------------------------------------------------------------------

    

Consolidated for

Borrower and its

Subsidiaries

--------------------------------------------------------------------------------

     Target

--------------------------------------------------------------------------------

    

Consolidated

Pro Forma1

--------------------------------------------------------------------------------

(xiv) obligations in respect of advance royalty commitments (but only to the
extent that the foregoing is included in the amount determined under item (xi)
above)

     $                           $                           $
                    

(xv) the sum (without duplication) of items 1(a)(xii) through (xiv) equals

     $                           $                           $
                    

(xvi) The difference between 1(a)(xi) minus 1(a)(xv) equals the Financial
Covenant Debt

     $                           $                           $
                    

(b) Consolidated EBITDA as of the Report Date for the four fiscal quarters then
ended, consolidated and combined in accordance with GAAP, is computed as
follows:

                          

(i) Consolidated Net Income (or loss)

     $                           $                           $
                    

(ii) non-cash compensation expenses related to common stock and other equity
securities issued to employees

     $                           $                           $
                    

(iii) extraordinary gains and losses

     $                           $                           $
                    

(iv) gains or losses on discontinued operations

     $                           $                           $
                    

(v) equity earnings or losses of Affiliates (other than Consolidated
Subsidiaries)

     $                           $                           $
                    

(vi) item (i) minus the sum of items (ii) through (v) equals the adjusted
Consolidated Net Income

     $                           $                           $
                    

 

1. See note 1 on prior page.

 

-4-

--------------------------------------------------------------------------------

Credit Agreement

--------------------------------------------------------------------------------

    

Consolidated for

Borrower and its

Subsidiaries

--------------------------------------------------------------------------------

     Target

--------------------------------------------------------------------------------

    

Consolidated

Pro Forma1

--------------------------------------------------------------------------------

(vii) interest expense (net of interest income) (to the extent included in
determining item (vi) above)

     $                           $                           $
                    

(viii) income tax expense (to the extent included in determining item (vi)
above)

     $                           $                           $
                    

(ix) depreciation (to the extent included in determining item (vi) above)

     $                           $                           $
                    

(x) depletion (to the extent included in determining item (vi) above)

     $                           $                           $
                    

(xi) amortization (to the extent included in determining item (vi) above)

     $                           $                           $
                    

(xii) non-cash debt extinguishment costs (to the extent included in determining
item (vi) above)

     $                           $                           $
                    

(xiii) non-cash charges due to cumulative effects of changes to accounting
principles (to the extent included in determining item (vi) above)

     $                           $                           $
                    

(xiv) cash dividends or distributions received from Affiliates (to the extent
not included in determining item (vi) above)

     $                           $                           $
                    

(xv) the sum of items (vi) through (xiv), inclusive, equals Consolidated EBITDA

     $                           $                           $
                    

 

1. See note 1 on prior page.

 

-5-

--------------------------------------------------------------------------------

Credit Agreement

--------------------------------------------------------------------------------

    

Consolidated for

Borrower and its

Subsidiaries

--------------------------------------------------------------------------------

     Target

--------------------------------------------------------------------------------

    

Consolidated

Pro Forma1

--------------------------------------------------------------------------------

2. Minimum Interest Coverage Ratio (Section 8.2.18). The ratio of (a)
Consolidated EBITDA to (b) Consolidated Cash Interest Expense calculated as of
the Report Date for the four (4) fiscal quarters then ended is:

 

which is not less than the minimum permitted ratio of 4.50 to 1.00 as of the
Report Date.

                          

(a) Consolidated EBITDA is equal to item 1(b)(xv)

     $                           $                           $
                    

(b) Consolidated Cash Interest Expense as of the Report Date for the four fiscal
quarters then ended, consolidated in accordance with GAAP, equals interest
expense (in each case required in accordance with the terms of the note,
instrument or other agreement applicable thereto to be payable in cash):

     $                           $                           $
                    

(c) Minimum Interest Coverage Ratio

                          

(i) the permitted ratio as of the Report Date equals

       N/A        N/A        4.5 to 1.00

(ii) the ratio of item 2(a) to item 2(b)(i) equals

                to 1.00                to 1.00                 to 1.00

(iii) item 2(c)(ii) is not less than item 2(c)(i)

                          

3. Availability, after giving effect to the Acquisition, is computed as follows:

                          

(a) cash which is not subject to any Lien or other restriction regarding the use
or investment thereof

     $                           $                           $
                    

 

1. See note 1 on prior page.

 

-6-

--------------------------------------------------------------------------------

Credit Agreement

--------------------------------------------------------------------------------

    

Consolidated for

Borrower and its

Subsidiaries

--------------------------------------------------------------------------------

     Target

--------------------------------------------------------------------------------

    

Consolidated

Pro Forma1

--------------------------------------------------------------------------------

(b) Revolving Credit Commitments

     $                             N/A      $                     

(c) Revolving Exposures

     $                             N/A      $                     

(d) The difference between item 3(b) minus item 3(c) (if a positive number)

     $                             N/A      $                     

(e) the lesser of $                     , the unused portion of the Permitted
Receivables Financing, and $                     , the amount of Accounts owned
by the Loan Parties that have not been sold to the Securitization Subsidiary but
that otherwise qualify for such sale under the Permitted Receivables Financing

     $                             N/A      $                     

(f) Availability equals the sum of item 3(a) plus item 3(d) plus item 3(e)

which is not less than $50,000,000 as of the Report Date.

     $                           $                           $
                    

 

1. See note 1 on prior page.

 

-7-

--------------------------------------------------------------------------------

EXHIBIT 8.3.4

 

FORM OF

QUARTERLY COMPLIANCE CERTIFICATE

 

                    , 2      

 

PNC Bank, National Association, as Paying Agent

One PNC Plaza

249 Fifth Avenue

Pittsburgh, Pennsylvania 15222-2707

 

Ladies and Gentlemen:

 

I refer to the Credit Agreement dated as of June 30, 2004 (as hereafter
modified, amended, supplemented or restated from time to time, the “Credit
Agreement”) among CONSOL Energy, Inc. (the “Borrower”), the Guarantors set forth
therein, the Lenders set forth therein, LaSalle Bank National Association,
Société Générale, New York Branch and SunTrust Bank, each in its capacity as a
co-documentation agent, and Citibank North America, Inc. and PNC Bank, National
Association, in their capacity as co-administrative agents for the Lenders
(collectively, the “Co-Administrative Agents” and PNC Bank, National
Association, individually, as “Paying Agent”). Unless otherwise defined herein,
terms defined in the Credit Agreement are used herein with the same meanings.
References herein to Sections of the Credit Agreement are qualified, in their
entirety, by the applicable provisions of the Section of the Credit Agreement so
referred to and together with all related provisions and definitions referred to
in such Section or incorporated therein.

 

I,                                                          , [Chief Financial
Officer / Treasurer] of the Borrower, do hereby certify on behalf of the
Borrower as of the quarter / year ended                                     ,
2             (the “Report Date”), as follows:

 

1. Leverage Ratio (Section 8.2.17). The ratio of (a) Financial Covenant Debt to
(b) Consolidated EBITDA is ______ to 1.0 as of the Report Date, which is not
more than the permitted ratio of 3.0 to 1.0 as of the Report Date.

 

(a) Financial Covenant Debt (determined as of the end of the fiscal quarter of
the Borrower ending as of the Report Date) for the Borrower and its Subsidiaries
is determined as the difference between amount (A) and amount (B) determined
below, as follows:

 

(i)

  indebtedness for borrowed money    $                     

(ii)

  obligations evidenced by notes, bonds, debentures or similar instruments or
that bear interest    $                     

 

--------------------------------------------------------------------------------

(iii)

  reimbursement and other obligations with respect to letters of credit and
bankers’ acceptances, whether or not matured      $                     

(iv)

  indebtedness for the deferred purchase price of property or services (other
than trade payables incurred in the ordinary course of business and payable in
accordance with customary practices that are not overdue for more than 90 days
unless contested in good faith and by appropriate proceedings if adequate
reserves in accordance with GAAP have been established and accrued expenses
incurred in the ordinary course of business)      $                     

(v)

  indebtedness created or arising under conditional sale and other title
retention agreements with respect to property acquired (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)      $
                    

(vi)

  obligations under capital leases (other than advance royalties under a mineral
lease)      $                     

(vii)

  obligations to purchase, redeem, retire, defease or otherwise acquire for
value any capital stock, other equity interest or Hybrid Securities, valued, in
the case of redeemable preferred stock, at the greater of its voluntary
liquidation preference and its involuntary liquidation preference plus accrued
and unpaid dividends      $                     

(viii)

  indebtedness and other obligations in respect of the Permitted Receivables
Financing      $                     

(ix)

  reimbursement obligations, to the extent not included in clause (iii) above,
under standby letters of credit (whether or not issued under the Credit
Agreement)      $                     

(x)

  non-contingent reimbursement obligations, to the extent not included in clause
(iii) above, or other matured obligations with respect to Indebtedness of the
type specified in clause (iii) above      $                     

 

2

--------------------------------------------------------------------------------

(xi)

  the sum (without duplication) of items (i) through (x) equals amount (A)     
$                     

(xii)

  obligations under undrawn standby letters of credit (whether or not issued
under the Credit Agreement) issued with respect to performance obligations under
sales contracts, performance obligations with respect to mine reclamation,
performance obligations relating to black lung benefit liabilities and
performance obligations relating to workers compensation and other employee
benefit liabilities (but only to the extent that the foregoing is included in
the amount determined under amount (A) above)      $                     

(xiii)

  obligations under each other letter of credit in respect of which the Borrower
has provided Letter of Credit Support, but only in an amount equal to such
Letter of Credit Support (but only to the extent that the foregoing is included
in the amount determined under amount (A) above)      $                     

(xiv)

  obligations in respect of advance royalty commitments (but only to the extent
that the foregoing is included in the amount determined under amount (A) above)
     $                     

(xv)

  the sum (without duplication) of items (xii) through (xiv) equals amount (B)
     $                     

(xvi)

  the difference between amount (A)              (from item (xi) above) and
amount (B)              (from item (xv) above) equals Financial Covenant Debt
     $                     

 

(b) Consolidated EBITDA of the Borrower and its Consolidated Subsidiaries as of
the Report Date for the four fiscal quarters then ended, consolidated and
combined in accordance with GAAP:

 

(i)

  Consolidated Net Income (or loss)      $                     

(ii)

  non-cash compensation expenses related to common stock and other equity
securities issued to employees      $                     

(iii)

  extraordinary gains and losses      $                     

(iv)

  gains or losses on discontinued operations      $                     

 

3

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(v)

  equity earnings or losses of Affiliates (other than Consolidated Subsidiaries)
     $                     

(vi)

  item (i) minus the sum of items (ii) through (v) equals Adjusted Consolidated
Net Income      $                     

(vii)

  interest expense (net of interest income) (to the extent included in
determining item (vi) above)      $                     

(viii)

  income tax expense (to the extent included in determining item (vi) above)
     $                     

(ix)

  depreciation (to the extent included in determining item (vi) above)      $
                    

(x)

  depletion (to the extent included in determining item (vi) above)      $
                    

(xi)

  amortization (to the extent included in determining item (vi) above)      $
                    

(xii)

  non-cash debt extinguishment costs (to the extent included in determining item
(vi) above)      $                     

(xiii)

  non-cash charges due to cumulative effects of changes to accounting principles
(to the extent included in determining item (vi) above)      $
                    

(xiv)

  cash dividends or distributions received from Affiliates (to the extent not
included in determining item (vi) above)      $                     

(xv)

  the sum of items (vi) through (xiv), inclusive, equals Consolidated EBITDA
     $                     

2. Minimum Interest Coverage Ratio. (Section 8.2.18) The ratio of (A)
Consolidated EBITDA to (B) Consolidated Cash Interest Expense of the Borrower
and its Subsidiaries is                      to 1.00 as of the Report Date for
the four fiscal quarters then ended, which is not less than the permitted ratio
of 4.50 to 1.00.

    (a) Calculation of amount (A) - Consolidated EBITDA (see item 1(b)(xv)
above):      $                     

 

4

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(b) Calculation of amount (B) - Consolidated Cash Interest Expense of the
Borrower and its Subsidiaries as of the Report Date for the four fiscal quarters
then ended consolidated in accordance with GAAP

 

(i)   interest expense (in each case required in accordance with the terms of
the note, instrument or other agreement applicable thereto to be payable in
cash) of the Borrower and its Subsidiaries    $                     

 

(c) Minimum Interest Coverage Ratio

 

(i)

  the permitted ratio as of the Report Date equals    4.5 to 1.00

(ii)

  the ratio of (A)              (item 2(a)) to (B)              (item 2(b)(i))
equals                 to 1.00

(iii)

  item 2(c)(ii) is not less than item 2(c)(i)     

 

3. Capital Expenditures and Capitalized Leases. (Section 8.2.15) As of the
Report Date for the fiscal year then ended, the aggregate amount of payments of
the Loan Parties on account of the purchase or lease of any assets that if
purchased would constitute fixed assets or that if leased would constitute a
capitalized lease in accordance with GAAP (excluding all assets purchased or
leased through (i) any Permitted Acquisition $                        , (ii)
reinvestment of insurance proceeds of a Casualty Event
$                        , or (iii) any Investment $                        )
equals $                        , which amount does not exceed the permitted
amount of $                        1 for the current fiscal year in the
aggregate for the Loan Parties.

 

4. Limitations on Other Investments. As of the Report Date, the aggregate amount
of Investments made by the Loan Parties in all Persons (other than the Loan
Parties) for such fiscal year to date consists of (A) Investments in the
aggregate amount of $                         in the form of cash, unpaid loans
or advances from the Loan Parties, and outstanding obligations (whether
contingent or otherwise) of the Loan Parties in connection with Guaranties,
which amount does not exceed the $50,000,000 in the aggregate permitted under
Section 8.2.4(vi) of the Credit Agreement, (B) Non-Strategic Assets and (C)
other assets, where the fair market value of such assets plus (without
duplication) all sales, transfers, and dispositions of assets under Section
8.2.7(ix) of the Credit Agreement, for the period from the Closing Date through
and including the Report Date equals $                        , which amount
does not exceed the $250,000,000 in the aggregate permitted under Section
8.2.4(vi) of the Credit Agreement.

--------------------------------------------------------------------------------

1

 

Fiscal Year Ending

--------------------------------------------------------------------------------

   Amount

--------------------------------------------------------------------------------

December 31, 2004

   $ 450,000,000

December 31, 2005

   $ 550,000,000

December 31, 2006

   $ 550,000,000

For Each Fiscal Year Thereafter

   $ 400,000,000

 

5

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[Complete the following section 5 only for Compliance Certificates submitted for
each fiscal quarter in which any sale, transfer or lease of assets has
occurred.]

 

5. Notification of Sale, Transfer or Lease of Assets. As of the Report Date, a
sale, transfer or lease of assets pursuant to Section 8.2.7(ix) has occurred as
is set forth in more detail on an attachment hereto.

 

[Complete the following sections 6, 7, 8 and 9 only for Compliance Certificates
submitted at the end of the fiscal year (commencing with the fiscal year ending
December 31, 2004).]

 

6. Limitations on Indebtedness. As of the Report Date, the aggregate amount of
Indebtedness secured by a Lien permitted by clauses (vii) or (xvii) of the
definition of Permitted Liens is $                        , which amount does
not exceed $250,000,000 at any time as permitted pursuant to Section 8.2.1(x).

 

7. Limitations on Dividends and Related Distributions. As of the Report Date:

 

(a) if the Borrower has not achieved and maintained an Investment Grade rating,
the amount of dividends payable by the Borrower on common stock issued by the
Borrower equals $                         per share for the fiscal year ending
as of the Report Date, which amount does not exceed $0.56 per share per fiscal
year as permitted pursuant to Section 8.2.5(ii); and

 

(b) the amount of common stock purchases or redemptions, made by the Borrower,
of common stock issued by the Borrower equals an aggregate amount of
$                        , which amount does not exceed the permitted amount of
$10,000,000 for the period commencing on the Closing Date through the Tranche B
Maturity Date plus for the fiscal year ending as of the Report Date,
$                         (the portion of the Available Excess Cash Flow (up to
a maximum of 50% of the Available Excess Cash Flow for the fiscal year) that is
not used to prepay, purchase, repurchase, or redeem the Senior Notes (1991) or
the Senior Notes (2002) during the fiscal year ending as of the Report Date) as
permitted pursuant to Section 8.2.5(iv).

 

8. Limitations on Dispositions of Assets. As of the Report Date:

 

(a) the fair market value of all assets sold, transferred or leased pursuant to
Section 8.2.7(iv) of the Credit Agreement equals $                         for
the fiscal year ended as of the Report Date, which amount shall not exceed
$250,000,000 in any given fiscal year; and

 

(b) the Net Cash Proceeds from all sales, transfers or leases of assets (other
than those specifically excepted pursuant to clauses (i) through (viii) of
Section 8.2.7) calculated for the period from the Closing Date through and
including the Report Date, equals an aggregate amount of
$                        , as permitted pursuant to Section 8.2.7(ix), which
amount does not exceed an aggregate amount of $250,000,000 less the fair market
value of assets contributed in the form of Investments pursuant to Section
8.2.4(vi)(C) subsequent to the Closing Date, which amount equals
$                        .

 

6

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9. Excess Cash Flow and Available Excess Cash Flow. Excess Cash Flow (for the
fiscal year ending on the Report Date) is calculated as the difference between
amount (A) and amount (B) as follows:

 

(a) Amount (A) is determined as the sum, without duplication and to the extent
included or deducted in determining Consolidated Net Income, of the following
for the Borrower and its Consolidated Subsidiaries as determined on a
consolidated basis in accordance with GAAP:

 

(i)

  Consolidated Net Income (or loss)      $                     

(ii)

  interest expense (which is not paid in cash during such fiscal year),
depreciation, depletion and amortization for such fiscal year (to the extent
deducted in determining item (i) above)      $                     

(iii)

  extraordinary non-cash losses during such fiscal year (to the extent deducted
in determining item (i) above)      $                     

(iv)

  non-cash losses in connection with assets dispositions whether or not
constituting extraordinary losses (to the extent deducted in determining item
(i) above)      $                     

(v)

  non-cash debt extinguishment costs (to the extent deducted in determining item
(i) above)      $                     

(vi)

  non-cash charges due to cumulative effects of changes in accounting principles
(to the extent deducted in determining item (i) above)      $
                    

(vii)

  non-cash compensation expenses related to common stock and other equity
securities issued to employees (to the extent deducted in determining item (i)
above)      $                     

(viii)

  cash dividends received from Affiliates (to the extent not included in
determining item (i) above)      $                     

(ix)

  equity losses of Affiliates (other than Consolidated Subsidiaries) (to the
extent deducted in determining item (i) above)      $                     

(x)

  the sum of items (i) through (ix) equals amount (A)      $
                    

 

7

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(b) Amount (B) is determined as the sum, without duplication and to the extent
included in determining Consolidated Net Income, of the following for the
Borrower and its Subsidiaries as determined on a consolidated basis in
accordance with GAAP:

 

(i)

  interest expense (net of interest income)      $                     

(ii)

  income taxes paid in cash      $                     

(iii)

  scheduled principal payments on Indebtedness      $                     

(iv)

  the aggregate amount of permitted cash capital expenditures      $
                    

(v)

  cash dividends         

(vi)

  the sum of items (i) through (v) equals Fixed Charges for such fiscal year
     $                     

(vii)

  the aggregate amount of prepayment of Indebtedness (other than prepayments of
Revolving Credit Loan and Swing Loans not accompanied by reductions of the
Commitments)      $                     

(viii)

  extraordinary non-cash gains during such fiscal year added in the
determination of Consolidated Net Income for such fiscal year      $
                    

(ix)

  non-cash gains in connection with asset dispositions whether or not
constituting extraordinary gains (to the extent included in determining
Consolidated Net Income above)      $                     

(x)

  equity earnings of Affiliates (other than Consolidated Subsidiaries) (to the
extent included in determining Consolidated Net Income above)      $
                    

(xi)

  the sum of items (vi) through (x) equals amount (B)      $
                    

 

(c) Excess Cash Flow and Available Excess Cash Flow:

 

(i)

  Amount (A)              (item 9(a)(x)) minus amount (B)              (item
9(b)(xi)) equals Excess Cash Flow for the fiscal year ending as of the Report
Date      $                     

(ii)

  50% of Excess Cash Flow              (item 9(c)(i)) equals Available Excess
Cash flow for the fiscal year ending as of the Report Date      $
                    

 

8

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10. The representations and warranties contained in Section 6 of the Credit
Agreement and in the other Loan Documents are true and correct on and as of this
date with the same effect as though such representations and warranties have
been made on and as of the date hereof (except representations and warranties
that expressly relate solely to an earlier date or time).

 

11. No Event of Default or Potential Default exists and is continuing as of the
date hereof.

 

9

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IN WITNESS WHEREOF, the undersigned has executed this Certificate this
             day of                     , 2      .

 

By:    

Name:

   

Title:

   

 

10