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SUBORDINATION AND INTERCREDITOR AGREEMENT
 
THIS SUBORDINATION AND INTERCREDITOR AGREEMENT (this “Agreement”) is entered
into as of this June ___, 2008, by and among (i) BLACK FOREST INTERNATIONAL, LLC
(“Subordinated Creditor”; and any references herein to “each” or “any”
Subordinated Creditor or to the “Subordinated Creditor” (or similar words) shall
mean and refer to Subordinated Creditor and its successors and permitted
assigns), (ii) FOURTH THIRD LLC, a Delaware limited liability company (“Fourth
Third”), as Agent for all Senior Lenders party to the Senior Credit Agreement
described below and as a Senior Lender, (iii) PNG VENTURES, INC., a Nevada
corporation (“PNG”), (iv) NEW EARTH LNG, LLC, a Delaware limited liability
company (“Earth”) and (v) the subsidiaries of Earth listed under “Companies” on
the signature pages hereto (together with PNG and Earth the “Companies” or a
“Company”).
 
R E C I T A L S
 
A.           The Agent, Senior Lenders (as hereinafter defined) and the
Companies have entered into an Amended and Restated Credit Agreement, dated as
of June __, 2008 (as the same may be amended, supplemented or otherwise modified
from time to time as permitted hereunder, the “Senior Credit Agreement”)
pursuant to which, among other things, Senior Lenders are making certain loans
and financial accommodations to Earth.
 
B.           The Agent and the Companies have entered into a Guarantee and
Collateral Agreement, dated as of June __, 2008 (as the same may be amended,
supplemented or otherwise modified from time to time as permitted hereunder, the
“Senior Guarantee and Collateral Agreement”) pursuant to which, among other
things, the Companies (other than Earth, but including PNG) have guaranteed the
debts of Earth to Senior Lenders arising pursuant to the Senior Credit Agreement
and all Companies (including Earth and PNG) have granted security interests in
the Collateral (as hereinafter defined).

C.           PNG has issued to Subordinated Creditor its 12% Subordinated
Secured Convertible Promissory Note, dated June 3, 2008 in the principal amount
of $626,250 (as the same may be amended, supplemented or otherwise modified from
time to time as permitted hereunder, the “Subordinated Note”).

D.           Payment of the Subordinated Note is guaranteed by each of the
Companies (other than PNG) pursuant to a Guaranty Agreement, dated as of June
__, 2008 (as the same may be amended, supplemented or otherwise modified from
time to time as permitted hereunder, the “Subordinated Guaranty”).

E.           The Companies, including PNG, have made in favor of Subordinated
Creditor, a General Security Agreement, dated as of June __, 2008 (as the same
may be amended, supplemented or otherwise modified from time to time as
permitted hereunder, the “Subordinated Security Agreement”).

F.           It is a condition to any extensions of credit being made to Earth
under the Senior Credit Agreement that the Subordinated Note, the Subordinated
Guaranty and the Subordinated Security Agreement shall have been made
subordinate, in right of payment and claim, to the

 
 

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rights and claims of the Senior Lenders under the Senior Credit Agreement and
the Senior Guarantee and Collateral Agreement.

 
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which hereby are acknowledged, the parties hereto hereby agree as follows:
 
1.
Definitions. The following terms shall have the following meanings in this
Agreement:

 
“Agent” shall mean Fourth Third LLC, as Agent for the Senior Lenders, or any
other Person appointed by the holders of the Senior Debt as administrative agent
for purposes of the Senior Debt Documents and this Agreement.
 
“Bankruptcy Code” shall mean Chapter 11 of Title 11 of the United States Code,
as amended from time to time and any successor statute and all rules and
regulations promulgated thereunder.
 
“Business Day” shall mean “Business Day” as defined in the Senior Credit
Agreements.
 
“Collateral” shall mean all real and personal property of any Company in which a
lien, security interest or mortgage has been or hereafter may be granted or
created in favor or the Agent or any Senior Lender as collateral security for
the payment or performance of any Senior Debt.
 
“Collection Action “ shall mean (a) to initiate or join in any suit, action or
proceeding against any Company or Collateral to enforce payment of or make
demand for all or any part of the Subordinated Debt, (b) to seek monetary
damages against any Company, or (c) to take from or for the account of any
Company, by set-off or in any other matter, all or any part of any moneys which
may now or hereafter be owing by such Company with respect to the Subordinated
Debt, but shall not include or mean any action by Subordinated Creditor with
respect to enforcement of any right to convert the Subordinated Note as provided
therein or with respect to its enforcement of any similar equity rights not
deemed part of the Subordinated Debt (as hereinafter defined).
 
“Distribution” means, with respect to any indebtedness or obligation, (a) any
payment or distribution by any Company (including any Company in its capacity as
a debtor or debtor-in-possession in a Proceeding) of cash, securities or other
property, by set-off or otherwise, on account of such indebtedness or obligation
or (b) any redemption, purchase or other acquisition of such indebtedness or
obligation by any Company.
 
“Enforcement Action” shall mean (a) to take from or for the account of any
Company or any other obligor on the Subordinated Debt, by set-off or in any
other manner, the whole or any part of any moneys which may now or hereafter be
owing by any Company or any such other obligor with respect to the Subordinated
Debt, (b) to sue for payment of, or to initiate or participate with others in
any suit, action or proceeding against any Company or any such other obligor to
(i) enforce payment of or to collect the whole or any part of the Subordinated
Debt or (ii) commence judicial enforcement of any of the rights and remedies
under the Subordinated Debt Documents or applicable law with respect to the
Subordinated Debt, (c) to notify account debtors or directly collect accounts
receivable or other payment rights of any Company or any such other obligor or
(d) take any action under the provisions of any state or federal law, including,
without limitation, the UCC, or under any contract or agreement, to enforce
against, foreclose upon, take possession of or sell any property or assets of
any Company or any Collateral; provided, however, that the term “Enforcement
Action” shall not include (i) an exercise of rights and remedies for specific
performance or equitable relief to compel any Company to comply with any
non-payment
 

 
 

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obligations under the Subordinated Debt Documents so long as it is not
accompanied by (a) a Collection Action or (b) a claim for relief or any other
Enforcement Action against or with respect to any Collateral, or (ii) any suit
or action initiated or maintained by the Subordinated Creditor solely to prevent
the running of any applicable statute of limitations or other similar
restriction on claims.
 
“Fourth Third Loan Documents” shall mean the Senior Credit Agreement, the Senior
Guarantee and Collateral Agreement, and all other agreements, documents and
instruments executed from time to time in connection therewith, as the same may
be amended, supplemented or otherwise modified from time to time in accordance
with the terms hereof.
 
“Permitted Refinancing” shall mean any refinancing of the outstanding Senior
Debt under the Fourth Third Loan Documents provided that the financing
documentation entered into by the Companies in connection with such Permitted
Refinancing constitutes Permitted Refinancing Senior Debt Documents.
 
“Permitted Refinancing Senior Debt Documents” shall mean any financing
documentation which replaces the Fourth Third Loan Documents and pursuant to
which the outstanding Senior Debt under the Fourth Third Loan Documents is
refinanced, as such financing documentation may be amended, supplemented or
otherwise modified from time to time in compliance with this Agreement, but
specifically excluding any such financing documentation to the extent that it
contains provisions violating Section 3.1 hereof.
 
“Person” means any natural person, corporation, general or limited partnership,
limited liability company, firm, trust, association, government, governmental
agency or other entity, whether acting in an individual, fiduciary or other
capacity.
 
“Proceeding” shall mean any voluntary or involuntary insolvency, bankruptcy,
receivership, custodianship, liquidation, dissolution, reorganization,
assignment for the benefit of creditors, appointment of a custodian, receiver,
trustee or other officer with similar powers or any other proceeding for the
liquidation, dissolution or other winding up of a Person.
 
“Reorganization Subordinated Securities” shall mean any debt or equity
securities issued in substitution of all or any portion of the Subordinated
Debt, in each case that are subordinated in right of payment, performance, liens
and otherwise to the Senior Debt (or any debt and/or equity securities issued in
substitution of all or any portion of the Senior Debt) to at least the same
extent that the Subordinated Debt (and the liens securing the Subordinated Debt)
are subordinated to the Senior Debt (and the liens securing the Senior Debt)
pursuant to the terms of this Agreement.
 
“Secured Claim” shall mean a “secured claim” within the meaning of such term in
Section 506(a) of the Bankruptcy Code (as presently in effect).
 
“Senior Debt” shall mean all obligations, liabilities and indebtedness of every
nature of any Company or any other obligor (other than Earth Biofuels) under the
Senior Debt Documents from time to time owed to Agent or any Senior Lender under
the Senior Debt Documents, including, without limitation, the principal amount
of all debts, claims and indebtedness, credit exposure and related obligations
arising from any hedging agreements, accrued and unpaid interest and all fees,
costs and expenses, whether primary, secondary, direct, contingent, fixed or
otherwise, heretofore, now and from time to time hereafter owing, due or
payable, whether before or after the filing of a Proceeding under the Bankruptcy
Code together with (a) any amendments, modifications, renewals or extensions
thereof to the extent not prohibited by the terms of this
 

 
 

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Agreement and (b) any interest accruing thereon after the commencement of a
Proceeding, without regard to whether or not such interest is an allowed claim;
provided, however, that in no event shall the principal amount of the Senior
Debt (excluding any interest or fees added to principal)  exceed the amount that
is the excess of (i) $35,000,000, over (ii) the amount of any prepayments or
repayments under the Senior Credit Agreements (specifically excluding, however,
any such prepayments or repayments occurring solely as a result of a Permitted
Refinancing) (the “Senior Debt Limit”).  The sum of the amount of principal
outstanding under the Senior Debt Documents that is in excess of the Senior Debt
Limit (including pursuant to any refinancing other than a Permitted
Refinancing), together with interest on such excess principal and fees
attributable to such excess principal shall not be considered Senior Debt for
purposes of this Agreement (such amount, “Excluded Senior Debt”).
 
“Senior Debt Documents” shall mean the Fourth Third Loan Documents and, after
the consummation of any Permitted Refinancing, the Permitted Refinancing Senior
Debt Documents.
 
“Senior Default” shall mean any “Event of Default” under the Senior Debt
Documents in respect of, or resulting from, the non-payment of any money when
due to Agent or any Senior Lender.
 
“Senior Lenders” shall mean the holders of the Senior Debt.
 
“Subordinated Debt” shall mean all of the obligations of any Company under the
Subordinated Debt Documents to the Subordinated Creditor or evidenced by or
incurred pursuant to the Subordinated Debt Documents, but shall not be deemed to
include any right to convert the Subordinated Note into equity as provided in
the Subordinated Note, any anti-dilution adjustment rights or rights to
conversion of the Subordinated Note, rights to receive replacement securities
for or to an adjustment of the convertibility provisions and conversion ratios
as set forth in the Subordinated Note (whether upon merger, sale of the company
or otherwise), or other rights to receive securities from time to time upon
conversion of the Subordinated Note, so long as none of the foregoing involves
the payment of money by any Company.
 
“Subordinated Debt Documents” shall mean the Subordinated Note, the Subordinated
Guaranty, the Subordinated Security Agreement, and all other documents,
agreements and instruments now existing or hereinafter entered into by any
Company to, with or in favor of the Subordinated Creditor in connection
therewith.
 
“UCC” shall mean the Uniform Commercial Code (or any similar or equivalent
legislation) as in effect in any applicable jurisdiction.
 
2.
Subordination.

 
2.1.           Subordination of Subordinated Debt to Senior Debt.  Each Company
covenants and agrees, and each Subordinated Creditor by its acceptance of the
Subordinated Debt Documents (whether upon original issue or upon transfer or
assignment) likewise covenants and agrees, notwithstanding anything to the
contrary contained in any of the Subordinated Debt Documents, that the payment
of any and all of the Subordinated Debt shall be subordinate and subject in
right and time of payment, to the extent and in the manner hereinafter set
forth, to the prior payment in full in cash (or other consideration acceptable
to Agent in its sole discretion) of all Senior Debt (but, for avoidance of any
doubt, not any Excluded Senior Debt).  Each holder of Senior Debt, whether now
outstanding or hereafter created, incurred, assumed or guaranteed, shall be
deemed to have acquired Senior Debt in reliance upon the provisions contained in
this Agreement.
 

 
 

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2.2.           Liquidation, Dissolution, Bankruptcy.  In the event of any
Proceeding involving any Company but subject to Section 2.7(b) which shall
control in the event of any inconsistency between its provision and the
following:
 
(a)           All Senior Debt shall first be paid in full in cash (or other
consideration acceptable to Agent in its sole discretion) before any
Distribution (other than Reorganization Subordinated Securities), whether in
cash, securities or other property, shall be made to  the Subordinated Creditor
on account of any Subordinated Debt.
 
(b)           Any Distribution (other than Reorganization Subordinated
Securities), whether in cash, securities or other property which would
otherwise, but for the terms hereof, be payable or deliverable in respect of the
Subordinated Debt shall be paid or delivered directly to Agent (to be held
and/or applied by Agent in accordance with the terms of the Senior Debt
Documents) until all Senior Debt is paid in full in cash (or other consideration
acceptable to Agent in its sole discretion). Each Subordinated Creditor
irrevocably authorizes, empowers and directs any debtor, debtor in possession,
receiver, trustee, liquidator, custodian, conservator or other Person having
authority, to pay or otherwise deliver all such Distributions to Agent. Each
Subordinated Creditor also irrevocably authorizes and empowers Agent and
appoints Agent its attorney-in-fact, in the name of such Subordinated Creditor,
to demand, sue for, collect and receive any and all such Distributions, at
Companies’ expense.  This power of attorney is coupled with an interest and is
irrevocable.
 
(c)           Each Subordinated Creditor agrees not to initiate, prosecute or
participate in any claim, action or other proceeding challenging the
enforceability, validity, perfection or priority of the Senior Debt or any liens
and security interests securing the Senior Debt.  Agent agrees not to initiate,
prosecute or participate in any claim, action or other proceeding challenging
the enforceability, validity, perfection or priority of the Subordinated Debt or
any liens and security interests securing the Subordinated Debt.
 
(d)           Each Subordinated Creditor, in its capacity as the holder of a
Secured Claim, agrees that Agent and Senior Lenders may consent to the use of
cash collateral or provide (or consent to any other Person providing) financing
to any Company (or trustee) on such terms and conditions and in such amounts as
Agent and Senior Lenders, in their sole discretion, may decide and, in
connection therewith, each Company (or trustee) may grant to Agent and Senior
Lenders (or such other Person providing financing) liens and security interests
upon all of its property, which liens and security interests (i) shall secure
payment of all Senior Debt (whether such Senior Debt arose prior to the
commencement of any Proceeding or at any time thereafter) and all other
financing provided by Senior Lenders (or such other Persons providing financing)
during the Proceeding and (ii) shall be superior in priority to the liens and
security interests, if any, in favor of such Subordinated Creditor on the
property of any Company, provided, that (A) the financing (x) does not compel
such Company to seek confirmation of a specific plan of reorganization for which
all or substantially all of the material terms are set forth in the financing
documentation or a related document or (y) that the financing documentation or
cash collateral order does not expressly require the liquidation of the
Collateral prior to a default under the financing documentation or cash
collateral order.  Each Subordinated Creditor, in its capacity as the holder of
Secured Claim, agrees that it will not object to or oppose, and will consent to,
a sale or other disposition of any property securing all of any part of the
Senior Debt free and clear of security interests, liens or other claims of such
Subordinated Creditor under Section 363 of the Bankruptcy Code or any other
provision of the Bankruptcy Code if Agent and Senior Lenders have consented to
such sale or disposition, provided that such Subordinated Creditor shall have
the right to object to the further use of the proceeds of such sale or other
disposition unless such
 

 
 

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proceeds are applied to permanently reduce the amount of Senior Debt
outstanding.   Each Subordinated Creditor, in its capacity as the holder of a
Secured Claim, agrees not to:  (1) assert any rights, to the extent adverse, in
the commercially reasonable opinion of the Agent, to the interests of the Agent
and the Senior Lenders, under Sections 362, 363 or 364 of the Bankruptcy Code
with respect to the Collateral, including any rights it may have to “adequate
protection” of such Subordinated Creditor’s interest in any Collateral in any
Proceeding or objecting to or opposing any use of cash, financing, security or
priority described in clauses (i) and (ii) above; provided, if the Agent or any
Senior Lender is granted adequate protection in the form of additional
collateral in connection with any cash collateral use or debtor-in-possession
financing, then the Subordinated Creditor may seek or request adequate
protection in the form of a Lien on such additional collateral, which Lien will
be subordinated to the Liens securing the Senior Debt (and such cash collateral
use or debtor-in-possession financing on the same basis) as the other Liens
securing the Subordinated Debt are so subordinated to the Senior Debt under this
Agreement; (2) oppose or object to any adequate protection sought by or granted
to Agent or any Senior Lender with respect to the Collateral; (3) initiate or
prosecute or join with any other Person to initiate or prosecute any claim,
action or other proceeding opposing a motion by Agent to lift the automatic
stay; (4)  vote in favor of any chapter 11 plan that seeks confirmation under
Section 1129(b)(2)(A) of the Bankruptcy Code, solely to the extent such vote is
required to satisfy Section 1129(a)(10) of the Bankruptcy Code (i.e., each
Subordinated Creditor agrees not to vote in favor of such plan if its allowed
secured claim is deemed impaired and no other impaired class has accepted the
plan, determined without including acceptance of the plan by any insider);
(5) seek the dismissal or conversion of a Proceeding, (6) seek the appointment
of a trustee, receiver or examiner in a Proceeding; or (7) seek to have the
automatic stay of Section 362 of the Bankruptcy Code (or any similar stay under
any other applicable law) lifted or modified with respect to the Collateral;
provided, however, that each Subordinated Creditor may object to any financing
under Section 364 in its capacity as the holder of a Secured Claim to the extent
that the principal amount, together with the aggregate principal amount of
Senior Debt outstanding immediately after giving effect to any payment thereof
with the proceeds of such financing, exceeds the Senior Debt Limit.  Any claim
of any Subordinated Creditor arising during a Proceeding, including a claim
under Section 507(b) of the Bankruptcy Code, shall constitute Subordinated Debt
under this Agreement.  Except for any claim based upon a breach of this
Agreement, each Subordinated Creditor waives any claim it may now or hereafter
have arising out of Agent’s or Senior Lenders’ election, in any Proceeding
instituted under the Bankruptcy Code, of the application of Section 1111(b)(2)
of the Bankruptcy Code, and/or any borrowing or grant of a security interest
under Section 364 or use of cash collateral under Section 363 of the Bankruptcy
Code by any Company, as debtor in possession.  Notwithstanding anything in this
Section 2.2(d) to the contrary but subject to the other provisions of this
Agreement (including Section 2.2(c)), in any Proceeding involving any Company, a
Subordinated Creditor may exercise rights and remedies generally available to
holders of unsecured claims against any of the Companies and otherwise in
accordance with the Subordinated Debt Documents and applicable law. In
furtherance of the foregoing, each Subordinated Creditor shall be entitled to
file any pleadings, objections, motions or agreements which assert rights or
interests available to unsecured creditors of the Companies arising under either
the Bankruptcy Code or applicable non-bankruptcy law, in each case if not
otherwise in contravention of the express terms of this Agreement, including any
right to object to the sale or use of property under Section 363 of the
Bankruptcy Code and/or any financing under Section 364 of the Bankruptcy Code
solely to the extent such objection could be asserted by the holder of an
unsecured claim against any Company.
 
(e)           Each Subordinated Creditor agrees to execute, verify, deliver and
file any proofs of claim in respect of the Subordinated Debt requested by Agent
in connection with any
 

 
 

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such Proceeding and hereby irrevocably authorizes, empowers and appoints Agent
its agent and attorney-in-fact to execute, verify, deliver and file such proofs
of claim upon the failure of any Subordinated Creditor promptly to do so prior
to ten (10) days before the expiration of the time to file any such proof of
claim; provided, that Agent shall have no obligation to execute, verify,
deliver, and/or file any such proof of claim.
 
(f)           The Senior Debt shall continue to be treated as Senior Debt and
the provisions of this Agreement shall continue to govern the relative rights
and priorities of Senior Lenders and the Subordinated Creditor even if all or
part of the Senior Debt or the security interests securing the Senior Debt are
subordinated, set aside, avoided, invalidated or disallowed in connection with
any such Proceeding and this Agreement shall be reinstated if at any time any
payment of any of the Senior Debt is rescinded or must otherwise be returned by
any holder of Senior Debt or any representative of such holder.
 
(g)           The parties acknowledge and agree that (i) the claims and
interests of Agent and the Senior Lenders under the Senior Debt Documents are
substantially different from the claims and interests of the Subordinated
Creditor under the Subordinated Debt Documents and such claims and interests
should be treated as separate classes for purposes of Section 1122 of the
Bankruptcy Code.
 
(h)           It is acknowledged and agreed that this Agreement shall constitute
a “subordination agreement” within the meaning of Section 510(a) of the
Bankruptcy Code.
 
2.3.           Subordinated Debt Payment Restrictions.
 
(a)           Notwithstanding the terms of the Subordinated Debt Documents, each
Company hereby agrees that it may not make, directly or indirectly, and each
Subordinated Creditor hereby agrees that it will not accept, any Distribution
(other than Reorganization Subordinated Securities) with respect to the
Subordinated Debt until the Senior Debt is paid in full in cash (or other
consideration acceptable to Agent in its sole discretion).
 
(b)           The provisions of this Section 2.3 shall not apply to a payment
with respect to which Section 2.3(b) or Section 2.7(b) is applicable.
 
(c)           Nothing contained in this Agreement shall prevent PNG from making,
or the Subordinated Creditor from receiving, at any time or from time to time,
any payments of accrued interest on the Subordinated Note (but for avoidance of
any doubt, no payments of principal, regardless of stated maturity or demand for
payment, except as expressly permitted under subsection (d) below) as and when
due and payable in accordance with the terms of the Subordinated Note as in
effect on the date hereof (without giving effect to any provisions of the
Subordinated Notes which would have the effect of increasing the amount or
frequency of payment thereof, including the imposition of any default rate
thereunder) except: (i) during the pendency of any Proceeding or (ii) if prior
to any such payment being made the Subordinated Creditor and PNG have received
written notice from Agent that a Senior Default has occurred and is continuing,
unless and until Subordinated Creditor and PNG have received written notice from
Agent that such Senior Default has been waived (which Agent agrees to provide
promptly after the Senior Lenders have waived such Senior Default).
 
(d)           Notwithstanding the foregoing provisions of subsection (a) above
or any other term of this Agreement to the contrary, upon the consummation of
any private investment in the public equity of PNG, or any similar transaction
involving the sale or exchange of equity
 

 
 

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securities, debt or convertible debt of PNG occurring subsequent to the date
hereof, provided that the Senior Lenders receive from PNG sufficient proceeds
therefrom in prepayment of the Senior Debt, to cause the unpaid principal amount
of the Senior Debt to be reduced to Thirty Million Dollars ($30,000,000) or
less; then, PNG shall pay to Subordinated Creditor, to the extent of any
remaining proceeds, the then outstanding amount of the Subordinated Debt.
 
(e)           Nothing contained herein shall prevent Subordinated Credit at any
time in accordance with the terms of Subordinated Note from exercising any right
to convert the Subordinated Note into equity as provided in the Subordinated
Note, any anti-dilution adjustment rights or rights to conversion of the
Subordinated Note, rights to receive replacement securities for or to an
adjustment of the convertibility provisions and conversion ratios as set forth
in the Subordinated Note (whether upon merger, sale of the company or
otherwise), or other rights to receive securities from time to time upon
conversion of the Subordinated Note, so long as none of the foregoing involves
the payment of money by any Company.
 
2.4.           Subordinated Debt Standstill Provisions.
 
(a)           Until the Senior Debt is paid in full in cash (or other
consideration acceptable to Agent in its sole discretion), no Subordinated
Creditor shall, without the prior written consent of Agent, take any Enforcement
Action with respect to the Subordinated Debt or any Collateral, provided,
however, that the Subordinated Creditor may take any Collection Action with
respect to the Subordinated Debt (but not against any Collateral or any other
property or assets securing Subordinated Debt) upon the acceleration of all or
any portion of the Senior Debt.
 
(b)           Notwithstanding the foregoing, (i) each Subordinated Creditor may
file proofs of claim against the Companies in any Proceeding involving the
Companies.  Any Distributions or other proceeds of any Enforcement Action
obtained by any Subordinated Creditor (other than Reorganization Subordinated
Securities) shall in any event be held in trust by it for the benefit of Agent
and Senior Lenders and promptly be paid or delivered to Agent for the benefit of
Senior Lenders in the form received until all Senior Debt is paid in full in
cash (or other consideration acceptable to Agent in its sole discretion).
 
(c)           Notwithstanding anything contained herein to the contrary, if
within 20 days of any acceleration of the Senior Debt by Senior Lenders such
acceleration is rescinded (whether or not any existing Senior Default has been
cured or waived), then all Collection Actions taken by the Subordinated Creditor
in reliance on such acceleration shall likewise be rescinded.
 
(d)           Notwithstanding anything in this Agreement to the contrary, no
provision herein shall prevent any Subordinated Creditor from furnishing a
notice under the Subordinated Debt Documents or this Agreement to any Company or
Agent to preserve or enforce its rights with respect thereto, including (without
limitation) notices to the Companies of the existence of a Subordinated Default.
 
2.5.           Incorrect Payments.  If any Distribution on account of the
Subordinated Debt is made by the Companies or accepted by any Subordinated
Creditor in violation of this Agreement, such Distribution shall not be
commingled with any of the assets of such Subordinated Creditor, shall be held
in trust by such Subordinated Creditor for the benefit of Agent and Senior
Lenders and shall be promptly paid over to Agent for application (in accordance
with the Senior Debt Documents) to the payment of the Senior Debt then remaining
unpaid, until all of the Senior Debt is paid in full.
 

 
 

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2.6.           Subordination of Liens and Security Interests; Agreement Not to
Contest; Agreement to Release Liens.  Until the Senior Debt has been paid in
full in cash (or other consideration acceptable to Agent in its sole
discretion), all liens and security interests of the Subordinated Creditor in
the Collateral shall be and hereby are subordinated for all purposes and in all
respects to the liens and security interests of Agent and Senior Lenders in the
Collateral, regardless of the time, manner or order of perfection of any such
liens and security interests and whether such liens and security interests of
Agent are set aside, avoided or unperfected.  Each Subordinated Creditor agrees
that it will not at any time contest the validity, perfection, priority or
enforceability of the Senior Debt, the Senior Debt Documents, or the liens and
security interests of Agent and Senior Lenders in the Collateral securing the
Senior Debt.  In the event that Agent or Senior Lenders release or agree to
release any of their liens or security interests in the Collateral in connection
with the sale or other disposition thereof or any of the Collateral is sold,
disposed of or retained pursuant to a foreclosure or similar action, each
Subordinated Creditor shall (or shall cause its agent to) promptly deliver (and
execute as appropriate) to Agent such termination statements and releases as
Agent shall reasonably request to effect the termination or release of the liens
and security interests of such Subordinated Creditor in such Collateral so long
as, subject to Section 2.7(b), (A) the net proceeds of such sale, disposition,
foreclosure or similar action are applied to the permanent payment of the Senior
Debt, (B) any proceeds from such sale or other disposition received by the Agent
in excess of the Senior Debt Limit shall be promptly delivered to the
Subordinated Creditor (subject to any prior rights of third parties) and (C)
such release by the Subordinated Creditor shall not extend to the proceeds from
such sale or other disposition.  In furtherance of the foregoing, each
Subordinated Creditor hereby irrevocably appoints Agent its attorney-in-fact,
with full authority in the place and stead of such Subordinated Creditor and in
the name of such Subordinated Creditor or otherwise, to deliver (and execute as
appropriate) any document or instrument which such Subordinated Creditor may be
required to deliver pursuant to this subsection 2.6.
 
2.7.           Application of Proceeds from Sale or other Disposition of the
Collateral.
 
(a)           In the event of any sale, transfer or other disposition (including
a casualty loss or taking through eminent domain) of the Collateral, the
proceeds resulting therefrom (including insurance proceeds) shall be distributed
and applied as follows: (a) first, to Agent to be applied in accordance with the
terms of the Senior Debt Documents until such time as the Senior Debt (other
than Excluded Senior Debt) is paid in full in cash (or other consideration
acceptable to Agent in its sole discretion); (b) second, to the Subordinated
Creditor to be applied in accordance with the Subordinated Debt Documents (as if
demand for such payment shall have been made under the Subsidiary Guaranty,
whether or not such demand has been made) until the Subordinated Debt (subject
to the limitation set forth in Section 3.2 below) is paid in full in cash (or
other consideration acceptable to each Subordinated Creditor in its sole
discretion); (c) third, to Agent to be applied in accordance with the terms of
the Senior Debt Documents until such time as all other Senior Debt not paid
pursuant to clause (a) is paid in full in cash (or such other consideration
acceptable to Agent in its sole discretion); and (d) fourth, to the Subordinated
Creditor to be applied in accordance with the Subordinated Debt Documents until
such time as all other Subordinated Debt not paid pursuant to clause (b) is paid
in full in cash (or such other consideration acceptable to Subordinated Creditor
in its sole discretion).
 
(b)           Notwithstanding the foregoing provisions of subsection (a) above,
or any other provision of this Agreement to the contrary, in the event of (i)
the sale, transfer or other disposition of the Collateral by Agent on behalf of
the Senior Lenders pursuant to any foreclosure or similar action initiated by
Agent as provided in Section 2.6, or (ii) any Distribution in connection with
the sale, transfer or other disposition of the Collateral pursuant to any
Proceeding, at any time while any Subordinated Debt is then outstanding, it is
the parties’ intent that the cash proceeds derived therefrom (net of all costs
and expenses incurred by Agent in giving effect to such foreclosure or other
proceeding) shall be shared between Senior Lenders and Subordinated Creditor,
upon final collection and receipt, thereof, on a pro rata basis, based
 

 
 

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on the respective amounts of the Senior Debt (other than, for avoidance of
doubt, any Excluded Senior Debt) and the Subordinated Debt then outstanding
(excluding therefrom any not issued and outstanding on the date of this
Agreement) in relation to the aggregate amount of all such Senior Debt and such
Subordinated Debt then outstanding; and, in furtherance thereof, coincident with
such final collection of such proceeds occurring, the Subordinated Creditor
shall be deemed to have purchased and sold, and the Senior Lenders shall be
deemed to have sold and purchased, respectively, participations in the Senior
Debt and the Subordinated Debt in pro rata amounts equal to such shared
proceeds.  Any such participations (i) shall be at “par”; (ii) shall not give
any consent or other rights to the buyer of such participation other than to
receive proceeds of Collateral derived from foreclosure or other proceeding
(whether initiated by Agent or Subordinated Creditor) or made as a Distribution
pursuant to any Proceeding; (iii) and shall be wholly without recourse to, or
any representation or warranty from, the seller of such participations.
 
2.8.           Sale, Transfer or other Disposition of Subordinated Debt.
 
(a)           No Subordinated Creditor shall sell, assign, pledge, dispose of or
otherwise transfer all or any portion of the Subordinated Debt or any
Subordinated Debt Document: (i) unless, prior to the consummation of any such
action, the transferee thereof shall execute and deliver to Agent an agreement
substantially identical to this Agreement, providing for the continued
subordination of the Subordinated Debt and liens securing same to the Senior
Debt and the liens, security interests and mortgages  securing same as provided
herein and for the continued effectiveness of all of the rights of Agent and
Senior Lenders arising under this Agreement and (ii) unless, following the
consummation of any such action, there shall be no more than ten holders of the
Subordinated Debt; provided, that for purposes of this clause (ii) holders of
the Subordinated Debt that are affiliates of each other shall be considered one
holder.
 
(b)           Notwithstanding the failure of any transferee to execute or
deliver an agreement substantially identical to this Agreement, the
subordination effected hereby shall survive any sale, assignment, pledge,
disposition or other transfer of all or any portion of the Subordinated Debt,
and the terms of this Agreement shall be binding upon the successors and assigns
of the Subordinated Creditor, as provided in Section 10 hereof.
 
2.9.           Legends. Until the termination of this Agreement in accordance
with Section 16 hereof, each Subordinated Creditor will cause to be clearly,
conspicuously and prominently inserted on the face of any Subordinated Debt
Document, as well as any renewals or replacements thereof, the following legend:
 
           “This instrument and the rights and obligations evidenced hereby and
any security interests or other liens securing such obligations are subordinate
in the manner and to the extent set forth in that certain Subordination and
Intercreditor Agreement (the “Subordination Agreement”) dated as of June [__],
2008 among Black Forest International, LLC, the “Companies” so identified
therein, and Fourth Third LLC (“Agent”), to the indebtedness (including
interest) owed by the Companies, and the security interests and liens securing
such indebtedness, pursuant to and in connection with that certain Amended and
Restated Credit Agreement, dated as of June [__], 2008, among the Agent, the
lenders named therein and the Company and the Loan Documents referred to therein
as such Credit Agreement and Loan Documents have been and hereafter may be
amended, supplemented or otherwise modified from time to time and to
indebtedness refinancing the indebtedness under that agreement as contemplated
by the Subordination Agreement; and each holder of this instrument, by its
acceptance hereof, irrevocably agrees to be bound by the provisions of the
Subordination Agreement.”
 

 
 

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3.           Modifications.
 
3.1.           Modifications to Senior Debt Documents. Senior Lenders may at any
time and from time to time without the consent of or notice to the Subordinated
Creditor, without incurring liability to the Subordinated Creditor and without
impairing or releasing the obligations of the Subordinated Creditor under this
Agreement, change the manner or place of payment or extend the time of payment
of or renew or alter any of the terms of the Senior Debt, or amend in any manner
any agreement, note, guaranty or other instrument evidencing or securing or
otherwise relating to the Senior Debt; provided that, without the prior written
consent of the Required Subordinated Creditor (as hereinafter defined), the
Senior Lenders shall not agree to any amendment, modification or supplement to,
or waiver or departure from, the Senior Debt Documents the effect of which is to
(a) increase the principal of the Senior Debt to an amount in excess of the
Senior Debt Limit, (b) increase the interest rate with respect to the Senior
Debt by more than 300 basis points, except in connection with the imposition of
a default rate of interest of up to 2.0% in accordance with the terms of the
Senior Debt Documents, (c) extend the final maturity of the Senior Debt (as set
forth in the Fourth Third Loan Documents in effect on the date hereof), except
that the final maturity of the Senior Debt under each Senior Credit Agreement
may be extended by up to two years, or (d) directly prohibit or restrict the
payment of principal of, interest on, or other amounts payable with respect to,
the Subordinated Debt, in a manner that is more restrictive then the
prohibitions and restrictions currently contained in the Senior Credit
Agreements.
 
3.2.           Modifications to Subordinated Debt Documents.
 
(a)           Until the Senior Debt has been paid in full in cash (or other
consideration acceptable to Agent in its sole discretion), and notwithstanding
anything to the contrary contained in the Subordinated Debt Documents, no
Subordinated Creditor shall, without the prior written consent of Agent, agree
to any amendment, modification or supplement to the Subordinated Debt Documents
that would (i) impose or make more burdensome any event of default or covenant
under the Subordinated Debt Documents, (ii) increase the principal amount of the
Subordinated Debt, (iii) increase the rate of interest on the Subordinated Debt
by more than 300 basis points except in connection with the imposition of a
default rate of interest of up to 2.0% or (iv) directly prohibit or restrict the
payment of any amounts payable with respect to the Senior Debt.
 
(b)           No Subordinated Creditor shall accept or enter into any
agreement  or instrument subsequent to the date hereof pursuant to which any
Company provides collateral security for the Subordinated Debt other than a
mortgage or deed of trust subordinate to any then existing mortgage or deed of
trust in favor of the Agent on any real property and improvements of a Company,
unless such agreement or instrument has been approved by the Agent in writing,
such approval not to be unreasonably withheld. Any such agreement or instrument
that is substantially similar to the security documents providing collateral
security for the Senior Debt shall be approved by the Agent so long as such
security document indicates that it is subject to this Agreement in a manner and
to an extent reasonably satisfactory to the Agent. In no event shall any
Subordinated Creditor accept or enter into any agreement or instrument pursuant
to which any Company provides a security interest in or mortgage on any property
of such Company in which the Agent does not have a first priority perfected
security interest. Prior to any Company or any Subordinated Creditor entering
into any agreement or instrument that would create a lien, security interest or
mortgage in any Collateral in favor of a collateral agent securing any
Subordinated Debt, the Companies and the Subordinated Creditor shall cause such
collateral agent to become a party to this Agreement and agree for this
Agreement to be amended to accommodate a collateral agent, in each case,
pursuant to agreements in form and substance reasonably satisfactory to the
Agent.
 

 
 

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(c)           In no event shall any Subordinated Creditor enter into any
agreement with any Company that places any restriction on the modification of
the Senior Debt Documents or creates any default or event of default or right to
accelerate, put or cause any Subordinated Creditor to purchase, any Subordinated
Debt, that is more extensive or more restrictive than the provisions of Section
3.1.
 
4.
Waiver of Certain Rights by the Subordinated Creditor.

 
4.1.           Marshaling. Each Subordinated Creditor hereby waives any rights
it may have under applicable law to assert the doctrine of marshaling or to
otherwise require Agent or Senior Lenders to marshal any property of any Company
or any other obligor on the Senior Debt for the benefit of such Subordinated
Creditor.
 
4.2.           Rights Relating to Agent’s Actions with respect to the
Collateral. Each Subordinated Creditor hereby waives, to the extent permitted by
applicable law, any rights which it may have as the holder of a Secured Claim to
enjoin or otherwise obtain a judicial or administrative order preventing Agent
or Senior Lenders from taking, or refraining from taking, any action with
respect to all or any part of the Collateral, except to the extent such action
is expressly excluded from the definition of Enforcement Action.  Without
limitation of the foregoing, subject to Section 2.7(b), each Subordinated
Creditor hereby agrees (a) that it has no right to direct or object to the
manner in which Agent and Lenders apply the proceeds of the Collateral resulting
from the exercise by Agent and Senior Lenders of rights and remedies under the
Senior Debt Documents to the Senior Debt and (b)  that Agent has not assumed any
obligation to act as the agent for the Subordinated Creditor with respect to the
Collateral. The Agent shall have the exclusive right to enforce against and
realize upon the Collateral until the Senior Debt is paid in full in cash (or
other consideration acceptable to Agent in its sole discretion).  In exercising
rights and remedies with respect to the Collateral, the Agent and Senior Lenders
may enforce the provisions of the Senior Debt Documents and exercise remedies
thereunder, all in such order and in such manner as it or they may determine in
the exercise of its or their sole business judgment.  Such exercise and
enforcement shall include, without limitation, the rights to sell or otherwise
dispose of Collateral, to incur expenses in connection with such sale or
disposition and to exercise all the rights and remedies of a secured lender
under the UCC.  In conducting any public or private sale under the UCC, Agent
shall give the Subordinated Creditor such notice of such sale as may be required
by the UCC; provided, however, that 10 days’ notice shall be deemed to be
commercially reasonable notice.
 
5.
Representations and Warranties.

 
5.1.           Representations and Warranties of the Subordinated
Creditor.  Subordinated Creditor hereby represents and warrants to Agent and
Senior Lenders that as of the date hereof: (a) Subordinated Creditor is a
company, duly formed and validly existing under the laws of the [state]; (b)
such Subordinated Creditor has the power and authority to enter into, execute,
deliver and carry out the terms of this Agreement on behalf to itself and the
Subordinated Creditor, all of which have been duly authorized by all proper and
necessary action; (c) the execution of this Agreement by Subordinated Creditor
will not violate or conflict with the organizational documents of Subordinated
Creditor, any material agreement binding upon Subordinated Creditor or any law,
regulation or order or require any consent or approval which has not been
obtained; (d) this Agreement is the legal, valid and binding obligation of
Subordinated Creditor, enforceable against Subordinated Creditor and the
Subordinated Creditor in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors’ rights generally and by equitable principles; and (e) Subordinated
Creditor, together with the other Subordinated Creditor, are the sole owners,
beneficially and of record, of the Subordinated Debt Documents and the
Subordinated Debt.
 

 
 

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5.2.           Representations and Warranties of Agent.  Agent hereby represents
and warrants to the Subordinated Creditor that as of the date hereof: (a) Agent
is a limited liability company duly formed and validly existing under the laws
of the State of Delaware; (b) Agent has the power and authority to enter into,
execute, deliver and carry out the terms of this Agreement on behalf of itself
and the Senior Lenders, all of which have been duly authorized by all proper and
necessary action; (c) the execution of this Agreement by Agent will not violate
or conflict with the organizational documents of Agent, any material agreement
binding upon Agent or any law, regulation or order or require any consent or
approval which has not been obtained; and (d) this Agreement is the legal, valid
and binding obligation of Agent, enforceable against Agent and the Senior
Lenders in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting the enforcement of creditors’ rights generally or by
equitable principles.
 
6.           Subrogation.  Subject to the payment in full in cash (or other
consideration acceptable to Agent in its sole discretion) of all Senior Debt,
the Subordinated Creditor shall be subrogated to the rights of Agent and Senior
Lenders to receive Distributions with respect to the Senior Debt until the
Subordinated Debt is paid in full. Each Subordinated Creditor agrees that in the
event that all or any part of a payment made with respect to the Senior Debt is
recovered from the holders of the Senior Debt in a Proceeding or otherwise, any
Distribution (other than Reorganization Subordinated Securities) received by
such Subordinated Creditor with respect to the Subordinated Debt at any time
after the date that it receives notice that such payment has been so recovered,
whether pursuant to the right of subrogation provided for in this Agreement or
otherwise, shall be deemed to have been received by such Subordinated Creditor
in trust as property of the holders of the Senior Debt and such Subordinated
Creditor shall forthwith deliver the same to the Agent for the benefit of the
Senior Lenders for application to the Senior Debt until the Senior Debt is paid
in full. A Distribution made pursuant to this Agreement to Agent or Senior
Lenders which otherwise would have been made to any Subordinated Creditor is
not, as between the Companies and such Subordinated Creditor, a payment by the
Companies to or on account of the Senior Debt.
 
7.           Modification. Any modification or waiver of any provision of this
Agreement, or any consent to any departure by any party from the terms hereof,
shall not be effective in any event unless the same is in writing and signed by
Agent and the Subordinated Creditor holding a majority of the principal amount
of the Subordinated Debt, and then such modification, waiver or consent shall be
effective only in the specific instance and for the specific purpose given. Any
notice to or demand on any party hereto in any event not specifically required
hereunder shall not entitle the party receiving such notice or demand to any
other or further notice or demand in the same, similar or other circumstances
unless specifically required hereunder.
 
8.           Further Assurances. Each party to this Agreement promptly will
execute and deliver such further instruments and agreements and do such further
acts and things as may be reasonably requested in writing by any other party
hereto that may be necessary or desirable in order to effect fully the purposes
of this Agreement.
 
9.           Notices. Unless otherwise specifically provided herein, any notice
delivered under this Agreement shall be in writing addressed to the respective
party as set forth below and may be personally served, telecopied or sent by
overnight courier service or certified or registered United States mail and
shall be deemed to have been given (a) if delivered in person, when delivered;
(b) if delivered by telecopy, when transmitted and a confirmation is received if
transmission and confirmation occur on a Business Day before 4:00 p.m. (New York
time) or, if after 4:00 p.m. (New York time), on the next succeeding Business
Day after such transmission and confirmation have occurred; (c) if delivered by
nationally recognized overnight courier, one (1) Business Day after delivery to
such courier properly addressed; or (d) if by United States mail, four (4)
Business Days after deposit in the United States mail, postage prepaid and
properly addressed.
 

 
 

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Notices shall be addressed as follows:
 
as set forth on its signature page hereto
 
If to Agent or Senior Lenders:
Fourth Third Capital LLC
375 Park Avenue
Suite 3304
New York, New York 10152
Attention: Brian J. Cavanaugh
Chief Financial Officer
Telecopy:  (212) 759-0091
 
With a copy to (which shall not constitute notice):
 
King & Spalding LLP
1185 Avenue of the Americas
New York, New York 10036
Attention: Robert S. Finley
Telecopy: (212) 556-2222

or in any case, to such other address as the party addressed shall have
previously designated by written notice to the serving party, given in
accordance with this Section 9.
 
10.           Successors and Assigns. This Agreement shall inure to the benefit
of, and shall be binding upon, the respective successors and assigns of Agent,
Senior Lenders, the Subordinated Creditor and the Companies. To the extent
permitted under the Senior Debt Documents, Senior Lenders may, from time to
time, without notice to any Subordinated Creditor, assign or transfer any or all
of the Senior Debt or any interest therein to any Person and, notwithstanding
any such assignment or transfer, or any subsequent assignment or transfer, the
Senior Debt shall, subject to the terms hereof, be and remain Senior Debt for
purposes of this Agreement, and every permitted assignee or transferee of any of
the Senior Debt or of any interest therein shall, to the extent of the interest
of such permitted assignee or transferee in the Senior Debt, be entitled to rely
upon and be the third party beneficiary of the subordination provided under this
Agreement and shall be entitled to enforce the terms and provisions hereof to
the same extent as if such assignee or transferee were initially a party hereto.
 
11.           Relative Rights.                                           This
Agreement shall define the relative rights of Agent, Senior Lenders and the
Subordinated Creditor. Nothing in this Agreement shall (a) impair, as among the
Companies, Agent and Senior Lenders and as between the Companies and the
Subordinated Creditor, the obligation of the Companies with respect to the
payment of the Senior Debt and the Subordinated Debt in accordance with their
respective terms or (b) affect the relative rights of Agent, Senior Lenders or
the Subordinated Creditor with respect to any other creditors of the
Companies.  For purposes of clarification, the Companies shall have no rights to
assert any rights or benefits hereunder.
 
12.           Conflict.  In the event of any conflict between any term, covenant
or condition of this Agreement and any term, covenant or condition of any of the
Senior Debt Documents or the Subordinated Debt Documents, the provisions of this
Agreement shall control and govern.
 

 
 

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13.           Headings.  The paragraph headings used in this Agreement are for
convenience only and shall not affect the interpretation of any of the
provisions hereof.
 
14.           Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
 
15.           Severability. In the event that any provision of this Agreement is
deemed to be invalid, illegal or unenforceable by reason of the operation of any
law or by reason of the interpretation placed thereon by any court or
governmental authority, the validity, legality and enforceability of the
remaining provisions of this Agreement shall not in any way be affected or
impaired thereby, and the affected provision shall be modified to the minimum
extent permitted by law so as most fully to achieve the intention of this
Agreement.
 
16.           Continuation of Subordination; Termination of Agreement.  This
Agreement shall remain in full force and effect until the payment in full in
cash (or other consideration acceptable to Agent in its sole discretion) of the
Senior Debt after which this Agreement shall terminate without further action on
the part of the parties hereto.
 
17.           Applicable Law. This Agreement shall be governed by and shall be
construed and enforced in accordance with the internal laws of the State of New
York, without regard to conflicts of law principles, other than section 5-1401
of the New York General Obligations Law.
 
18.           CONSENT TO JURISDICTION.  EACH SUBORDINATED CREDITOR AND EACH
COMPANY HEREBY CONSENTS TO THE JURISDICTION OF ANY STATE OR FEDERAL COURT
LOCATED WITHIN THE COUNTY OF NEW YORK, STATE OF NEW YORK AND IRREVOCABLY AGREES
THAT, SUBJECT TO AGENT’S ELECTION, ALL ACTIONS OR PROCEEDINGS ARISING OUT OF OR
RELATING TO THIS AGREEMENT SHALL BE LITIGATED IN SUCH COURTS. EACH SUBORDINATED
CREDITOR AND EACH COMPANY EXPRESSLY SUBMITS AND CONSENTS TO THE JURISDICTION OF
THE AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON CONVENIENS.  EACH
SUBORDINATED CREDITOR AND EACH COMPANY HEREBY WAIVES PERSONAL SERVICE OF ANY AND
ALL PROCESS AND AGREES THAT ALL SUCH SERVICE OF PROCESS MAY BE MADE UPON IT BY
CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED, ADDRESSED TO SUCH
SUBORDINATED CREDITOR AND THE COMPANIES AT THEIR RESPECTIVE ADDRESSES SET FORTH
IN THIS AGREEMENT AND SERVICE SO MADE SHALL BE COMPLETE TEN (10) DAYS AFTER THE
SAME HAS BEEN POSTED.
 
19.           WAIVER OF JURY TRIAL.  EACH SUBORDINATED CREDITOR, EACH COMPANY
AND AGENT HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR
CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT, ANY OF THE
SUBORDINATED DEBT DOCUMENTS OR ANY OF THE SENIOR DEBT DOCUMENTS.  EACH
SUBORDINATED CREDITOR, EACH COMPANY AND AGENT ACKNOWLEDGES THAT THIS WAIVER IS A
MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS RELIED
ON THE WAIVER IN ENTERING INTO THIS AGREEMENT AND THE SENIOR DEBT DOCUMENTS AND
THAT EACH WILL CONTINUE TO RELY ON THE WAIVER IN THEIR RELATED FUTURE DEALINGS.
EACH SUBORDINATED CREDITOR, EACH COMPANY AND AGENT WARRANTS AND REPRESENTS THAT
EACH HAS HAD THE OPPORTUNITY OF REVIEWING THIS JURY WAIVER WITH LEGAL COUNSEL,
AND THAT EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS.
 

 
 

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20.           Perfection Agent.  Agent and each Subordinated Creditor agree that
solely with respect to (i) any Collateral in which a security interest may only
be perfected by title, possession or “control”, or (ii) any shares of the issued
and outstanding stock of Earth pledged by PNG as Collateral and held by the
Agent, such party shall serve as the contractual representative agent of the
other party solely for purposes of perfecting (to the extent not otherwise
perfected) the liens in favor of the Subordinated Creditor or liens in favor of
Agent and Senior Lenders, as applicable, subject in all events to the relative
priorities established pursuant to this Agreement and to the limitations set
forth in this Agreement with respect to such party’s liabilities, duties and
obligations in respect of the Collateral or otherwise.  Without limiting the
generality of the foregoing, each party shall be deemed to be an agent of the
other party solely for purposes of perfection under the UCC and shall not incur
any liabilities, fiduciary duties or obligations whatsoever to the other party
due to the provisions of this Section 20.  Promptly following the payment in
full of the Senior Debt in cash, cash equivalents or other consideration
acceptable to the Agent, the Agent shall, upon the request of the Subordinated
Creditor, (x) deliver the remainder of such Collateral, if any, in its
possession to the designee of the Subordinated Creditor, and (y) deliver any
certificates of title held by it in respect of the Collateral (such as motor
vehicle titles) and assign the Lien of the Agent on any such certificates of
title, without representation, warranty or recourse and otherwise on terms
reasonably acceptable to the Required Subordinated Creditor, in each case except
as may otherwise be required by applicable law or court order.
 

 
(Signature page follows)
 

 

 
 

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IN WITNESS WHEREOF, the Subordinated Creditor, the Companies and Agent have
caused this Agreement to be executed as of the date first above written.
 
SUBORDINATED CREDITOR
BLACK FOREST INTERNATIONAL, LLC
By: BCGU, LLC, its administrative manager
By: Business Consulting Group Unlimited, Inc., its
       Administrative manager
 
 
By: /s/ Brad Bingham          
Name: Brad Bingham
      Title: Attorney in Fact
If to the Subordinated Creditor:
____________________________
____________________________
____________________________
____________________________
Attention:____________________
Telecopy:____________________
 
With a copy to (which shall not constitute notice):
 
____________________________
____________________________
____________________________
____________________________
Attention:____________________
Telecopy:____________________
 

 

Signature Page to Subordination and Intercreditor Agreement
 
 
 

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COMPANIES:
PNG VENTURES, INC.
 
By: /s/ Kevin Markey          
      Name: Kevin Markey
      Title: Chief Executive Officer
 
NEW EARTH LNG, LLC
 
By: /s/ Kevin Markey          
      Name: Kevin Markey
      Title: President
 
APPLIED LNG TECHNOLOGIES USA, L.L.C.
 
By:  New Earth LNG, LLC, its sole member
 
By: /s/ Kevin Markey          
      Name: Kevin Markey
      Title: President
 
FLEET STAR, INC.
 
By: /s/ Dennis G. McLaughlin, III    
      Name: Dennis G. McLaughlin, III
      Title: Chief Executive Officer
 
EARTH LEASING, INC.
 
By: /s/ Dennis G. McLaughlin, III    
      Name: Dennis G. McLaughlin, III
      Title: Chief Executive Officer
 
ARIZONA LNG, L.L.C.
 
By:  New Earth LNG, LLC, its sole member
 
By: /s/ Kevin Markey          
      Name: Kevin Markey
      Title: President
 

 

Signature Page to Subordination and Intercreditor Agreement
 
 
 

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AGENT:
FOURTH THIRD LLC, a Delaware limited liability company, as Agent and as a Senior
Lender
 
 
By: /s/ Seth R. Taube        
Its: Authorized Signatory

 

 

 
 
 

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