Exhibit 10.1

EXECUTION VERSION

 

 

CREDIT AGREEMENT

dated as of

August 5, 2011,

among

DYNEGY MIDWEST GENERATION, LLC,

as Borrower,

DYNEGY COAL INVESTMENTS HOLDINGS, LLC,

as Intermediate Holdings,

THE LENDERS PARTY HERETO,

CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH,

as Administrative Agent and Collateral Trustee

CREDIT SUISSE SECURITIES (USA) LLC

and

GOLDMAN SACHS LENDING PARTNERS LLC,

as Joint Bookrunners and Joint Lead Arrangers

CREDIT SUISSE SECURITIES (USA) LLC

and

GOLDMAN SACHS LENDING PARTNERS LLC

as Joint Syndication Agents and

as Co-Documentation Agents

BARCLAYS CAPITAL,

as Co-Manager

 

 

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Table of Contents

 

         Page   ARTICLE I    Definitions   

SECTION 1.01.

 

Defined Terms

     1   

SECTION 1.02.

 

Terms Generally

     33   

SECTION 1.03.

 

Classification of Term Loans and Borrowings

     34    ARTICLE II    The Credits   

SECTION 2.01.

 

Term Loans

     34   

SECTION 2.02.

 

Term Loans

     34   

SECTION 2.03.

 

Borrowing Procedure

     36   

SECTION 2.04.

 

Evidence of Debt; Repayment of Term Loans

     36   

SECTION 2.05.

 

Fees

     37   

SECTION 2.06.

 

Interest on Term Loans

     37   

SECTION 2.07.

 

Default Interest

     38   

SECTION 2.08.

 

Alternate Rate of Interest

     38   

SECTION 2.09.

 

Termination of Term Loan Commitments

     38   

SECTION 2.10.

 

Conversion and Continuation of Borrowings

     39   

SECTION 2.11.

 

Repayment of Term Borrowings

     40   

SECTION 2.12.

 

Voluntary Prepayment

     41   

SECTION 2.13.

 

Mandatory Prepayments

     44   

SECTION 2.14.

 

Reserve Requirements; Change in Circumstances

     46   

SECTION 2.15.

 

Change in Legality

     48   

SECTION 2.16.

 

Breakage

     48   

SECTION 2.17.

 

Pro Rata Treatment

     49   

SECTION 2.18.

 

Sharing of Setoffs

     49   

SECTION 2.19.

 

Payments

     49   

SECTION 2.20.

 

Taxes

     50   

SECTION 2.21.

 

Assignment of Term Loans Under Certain Circumstances; Duty to Mitigate

     53   

SECTION 2.22.

 

Extensions of Term Loans

     54    ARTICLE III    Representations and Warranties   

SECTION 3.01.

 

Organization; Powers

     57   

 

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Table of Contents

 

         Page  

SECTION 3.02.

 

Authorization

     57   

SECTION 3.03.

 

Enforceability

     57   

SECTION 3.04.

 

Governmental Approvals

     58   

SECTION 3.05.

 

Financial Statements

     58   

SECTION 3.06.

 

No Material Adverse Change

     59   

SECTION 3.07.

 

Title to Properties; Possession Under Leases

     59   

SECTION 3.08.

 

Subsidiaries

     59   

SECTION 3.09.

 

Litigation; Compliance with Laws

     60   

SECTION 3.10.

 

Agreements

     60   

SECTION 3.11.

 

Federal Reserve Regulations

     60   

SECTION 3.12.

 

Investment Company Act

     61   

SECTION 3.13.

 

Use of Proceeds

     61   

SECTION 3.14.

 

Tax Returns

     61   

SECTION 3.15.

 

No Material Misstatements

     61   

SECTION 3.16.

 

Employee Benefit Plans

     62   

SECTION 3.17.

 

Environmental Matters

     62   

SECTION 3.18.

 

Insurance

     63   

SECTION 3.19.

 

Security Documents

     63   

SECTION 3.20.

 

Location of Real Property and Leased Premises

     64   

SECTION 3.21.

 

Labor Matters

     64   

SECTION 3.22.

 

Solvency

     64   

SECTION 3.23.

 

Transaction Documents and Material Project Documents

     65   

SECTION 3.24.

 

Sanctioned Persons

     65   

SECTION 3.25.

 

Intellectual Property; Licenses, Etc.

     65   

SECTION 3.26.

 

Energy Regulation.

     66   

SECTION 3.27.

 

Sole Purpose of Intermediate Holdings

     66   

SECTION 3.28.

 

Deposit Accounts and Securities Accounts

     67   

SECTION 3.29.

 

Easements; Utilities; Services

     67   

SECTION 3.30.

 

Permits

     67   

SECTION 3.31.

 

Property Rights

     67    ARTICLE IV    Conditions of Lending    ARTICLE V    Affirmative
Covenants   

SECTION 5.01.

 

Existence; Compliance with Laws; Businesses and Properties

     74   

SECTION 5.02.

 

Insurance

     74   

SECTION 5.03.

 

Taxes

     75   

SECTION 5.04.

 

Financial Statements, Reports, etc.

     75   

 

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Table of Contents

 

         Page  

SECTION 5.05.

 

Litigation and Other Notices

     77   

SECTION 5.06.

 

Information Regarding Collateral

     78   

SECTION 5.07.

 

Maintaining Records; Access to Properties and Inspections

     78   

SECTION 5.08.

 

Use of Proceeds

     79   

SECTION 5.09.

 

Employee Benefits

     79   

SECTION 5.10.

 

Compliance with Environmental Laws

     79   

SECTION 5.11.

 

Environmental Disclosure, Preparation of Environmental Reports and Access

     79   

SECTION 5.12.

 

Further Assurances

     82   

SECTION 5.13.

 

Interest Rate Protection

     83   

SECTION 5.14.

 

Performance of Material Project Documents

     83   

SECTION 5.15.

 

Separateness

     83   

SECTION 5.16.

 

Subordination

     84   

SECTION 5.17.

 

Post-Closing Covenant

     84   

SECTION 5.18.

 

Unused Collateral Postings Account

     86    ARTICLE VI    Negative Covenants   

SECTION 6.01.

  Indebtedness      86   

SECTION 6.02.

  Liens      89   

SECTION 6.03.

  Sale and Lease-Back Transactions      93   

SECTION 6.04.

  Investments, Loans and Advances      93   

SECTION 6.05.

  Mergers, Consolidations, Sales of Assets and Acquisitions      96   

SECTION 6.06.

  Restricted Payments; Restrictive Agreements      97   

SECTION 6.07.

  Transactions with Affiliates      99   

SECTION 6.08.

  Business of Borrower and Subsidiaries      99   

SECTION 6.09.

  Other Indebtedness and Agreements      99   

SECTION 6.10.

  Capital Expenditures      100   

SECTION 6.11.

  Fiscal Year      101   

SECTION 6.12.

  Certain Equity Securities      101   

SECTION 6.13.

  Permitted Activities of Intermediate Holdings      101   

SECTION 6.14.

  Foreign Subsidiaries      101   

SECTION 6.15.

  Formation of Subsidiaries      101   

SECTION 6.16.

  Limitations on Deposit Accounts and Securities Accounts      101   

 

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Table of Contents

 

         Page ARTICLE VII Events of Default ARTICLE VIII The Administrative
Agent and the Collateral Trustee; Etc. ARTICLE IX Miscellaneous SECTION 9.01.  
Notices; Electronic Communications    110 SECTION 9.02.   Survival of Agreement
   113 SECTION 9.03.   Binding Effect    113 SECTION 9.04.   Successors and
Assigns    113 SECTION 9.05.   Expenses; Indemnity    118 SECTION 9.06.   Right
of Setoff    121 SECTION 9.07.   Applicable Law    121 SECTION 9.08.   Waivers;
Amendment    121 SECTION 9.09.   Interest Rate Limitation    123 SECTION 9.10.  
Entire Agreement    123 SECTION 9.11.   WAIVER OF JURY TRIAL    124 SECTION
9.12.   Severability    124 SECTION 9.13.   Counterparts; Effectiveness;
Electronic Execution    124 SECTION 9.14.   Headings    125 SECTION 9.15.  
Jurisdiction; Consent to Service of Process    125 SECTION 9.16.  
Confidentiality    125 SECTION 9.17.   Lender Action    126 SECTION 9.18.   USA
PATRIOT Act Notice    126

 

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Table of Contents

SCHEDULES

 

Schedule 1.01(a)   -    Subsidiary Guarantors Schedule 1.01(b)   -    Mortgaged
Property Schedule 1.01(c)   -    Excluded Obligations Schedule 2.01   -   
Lenders and Term Loan Commitments Schedule 3.07   -    Rights of First Refusal
and Options with Respect to Mortgaged Properties Schedule 3.08   -   
Subsidiaries Schedule 3.09   -    Litigation Schedule 3.17   -    Environmental
Matters Schedule 3.18   -    Insurance Schedule 3.19(a)   -    UCC Filing
Offices Schedule 3.19(c)   -    Mortgage Filing Offices Schedule 3.20(a)   -   
Real Property Schedule 3.28   -    Deposit Accounts and Securities Accounts
Schedule 3.30   -    Permits Schedule 4(a)   -    Local Counsel Schedule 6.01  
-    Existing Indebtedness Schedule 6.02   -    Existing Liens Schedule 6.10(a)
  -    Permitted Capital Expenditures Schedule 6.10(d)   -    Environmental
Capital Expenditures and Proposed Legislation

EXHIBITS

 

Exhibit A   -    Form of Administrative Questionnaire Exhibit B   -    Form of
Assignment and Assumption Exhibit C   -    Form of Borrowing Request Exhibit D  
-    Form of Guarantee and Collateral Agreement Exhibit E   -    Form of
Mortgage Exhibit F   -    Form of Affiliate Subordination Agreement Exhibit G  
-    Form of Local Counsel Opinion Exhibit H   -    Form of Compliance
Certificate Exhibit I-1   -    Form of U.S. Tax Compliance Certificate Exhibit
I-2   -    Form of U.S. Tax Compliance Certificate Exhibit I-3   -    Form of
U.S. Tax Compliance Certificate Exhibit I-4   -    Form of U.S. Tax Compliance
Certificate Exhibit J   -    Form of Pledge Agreement Exhibit K   -    Form of
Intercreditor Agreement Exhibit L   -    Form of Solvency Certificate Exhibit M
  -    Form of Holdings Separateness Letter Exhibit N   -    Form of Parent
Separateness Letter Exhibit O   -    Form of Dynegy Power Marketing, LLC
Representation Letter Exhibit P   -    Form of Opinion Assumption Certificate

 

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CREDIT AGREEMENT (this “Agreement”) dated as of August 5, 2011, among DYNEGY
MIDWEST GENERATION, LLC, a Delaware limited liability company (the “Borrower”),
DYNEGY COAL INVESTMENTS HOLDINGS, LLC, a Delaware limited liability company
(“Intermediate Holdings”), the Lenders (such term and each other capitalized
term used but not defined in this introductory statement having the meaning
given it in Article I), CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH (“Credit
Suisse”) as administrative agent (in such capacity, including any successor
thereto, the “Administrative Agent”) and as collateral trustee (in such
capacity, including any successor thereto, the “Collateral Trustee”) for the
Lenders, CREDIT SUISSE SECURITIES (USA) LLC and GOLDMAN SACHS LENDING PARTNERS
LLC, as Joint Bookrunners and Joint Lead Arrangers (collectively, the “Joint
Lead Arrangers”), CREDIT SUISSE SECURITIES (USA) LLC and GOLDMAN SACHS LENDING
PARTNERS LLC, as Joint Syndication Agents (the “Joint Syndication Agents”),
CREDIT SUISSE SECURITIES (USA) LLC and GOLDMAN SACHS LENDING PARTNERS LLC, as
Co-Documentation Agents (the “Co-Documentation Agents”), and BARCLAYS CAPITAL,
the investment banking division of BARCLAYS BANK PLC, as Co-Manager (the
“Co-Manager”).

The Borrower has requested the Lenders to extend credit in the form of Term
Loans on the Closing Date, in an aggregate principal amount not in excess of
$600,000,000.

The proceeds of the Term Loans will be used by the Borrower on the Closing Date
(a) to cash collateralize letters of credit, whether existing on the Closing
Date or issued thereafter, (b) to make a $200,000,000 Restricted Payment to
Intermediate Holdings (which will make a Restricted Payment in an equal amount
to Holdings) within five Business Days following the Closing Date, (c) for
general corporate purposes and to pay transaction fees and expenses (including
amounts required to repay the Existing Credit Facility) and (d) for the other
purposes on the Closing Date set forth in the statement of sources and uses of
funds delivered pursuant to paragraph (n) of Article IV. Proceeds of Term Loans,
to the extent in excess of the immediate needs described in the preceding
sentence, may be held as cash or Permitted Investments until used by the
Borrower for the purposes described above, the making of Restricted Payments on
the terms and conditions contained herein and other general corporate purposes.

The Lenders are willing to extend such credit to the Borrower on the terms and
subject to the conditions set forth herein. Accordingly, the parties hereto
agree as follows:

ARTICLE I

Definitions

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

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

“Acceptable Commodity Counterparty” shall mean any Person who, at the time the
applicable Eligible Commodity Hedging Agreement is entered into, (i) in the
ordinary course purchases or sells power or enters into commodity transactions
and (ii)(A) has a corporate rating of BBB- or higher by S&P and a corporate
family rating of Baa3 or higher by Moody’s (or an equivalent rating by another
nationally recognized statistical rating organization of similar standing if
either of such ratings agencies is not then in the business of providing such
ratings), or (B) whose obligations are supported by collateral, guarantees or
letters of credit in a manner consistent with the then prevailing industry
practice for similarly situated Persons from Persons that have the ratings
described in clause (A) above.

“Acceptable Financial Counterparty” shall mean any Person who, at the time the
applicable Eligible Commodity Hedging Agreement, Interest Rate/Currency Hedging
Agreement or Treasury Services Agreement is entered into, (a) in the ordinary
course enters into financial derivative transactions (including rate swaps,
commodity hedges, swaps, futures or options) or commodity transactions
(including power purchase or sale or gas purchase or sale and tolling
agreements) or provides treasury services or cash management services and (b)(i)
has a corporate rating of A- or higher by S&P and a corporate family rating of
A3 or higher by Moody’s (or an equivalent rating by another nationally
recognized statistical rating organization of similar standing if either of such
rating agencies is not then in the business of providing such ratings), or
(ii) whose obligations are supported by collateral, guarantees or letters of
credit in a manner consistent with the then prevailing industry practice for
similarly situated Persons from Persons that have the ratings described in
clause (i) above.

“Adjusted LIBO Rate” shall mean, with respect to any Eurodollar Borrowing for
any Interest Period, an interest rate per annum equal to the greater of
(a) 1.50% per annum and (b) the product of (i) the LIBO Rate in effect for such
Interest Period and (ii) Statutory Reserves.

“Administrative Agent” shall have the meaning assigned to such term in the
introductory statement to this Agreement and shall include the Administrative
Agent in its capacity as Auction Manager.

“Administrative Agent Fees” shall have the meaning assigned to such term in
Section 2.05.

“Administrative Questionnaire” shall mean an Administrative Questionnaire in the
form of Exhibit A, or such other form as may be supplied from time to time by
the Administrative Agent.

“Affiliate” shall mean, with respect to a specified Person, another Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or

 

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is under common Control with the Person specified; provided, however, that, for
purposes of the definition of “Eligible Assignee”, Section 2.12(e), Section 6.07
and 9.04(b)(except in determining Qualified Debt Investors as used therein) the
term “Affiliate” shall also include any Person that directly or indirectly owns
10% or more of any class of Equity Interests, including for the purposes of this
definition, any total return swap in respect thereof or similar instrument, of
the Person specified or that is an officer or director of the Person specified
or an officer or director of the parent of the Person specified.

“Affiliate Subordination Agreement” shall mean an Affiliate Subordination
Agreement in the form of Exhibit F pursuant to which intercompany obligations
and advances owed by any Loan Party are subordinated to the Obligations.

“Affiliated Lenders” shall have the meaning assigned to such term in
Section 2.12(e).

“Agents” shall have the meaning assigned to such term in Article VIII.

“Agreement Value” shall mean, in respect of Hedging Obligations, on any date of
determination, the maximum aggregate amount (giving effect to any netting
agreements) that Intermediate Holdings, the Borrower or such Subsidiary would be
required to pay if the agreements governing such Hedging Obligations were
terminated on such date.

“Alternate Base Rate” shall mean, for any day, a rate per annum equal to the
greatest of (a) the Prime Rate in effect on such day, (b) the Federal Funds
Effective Rate in effect on such day plus 1/2 of 1% and (c) the sum of (i) the
Adjusted LIBO Rate (after giving effect to any Adjusted LIBO Rate “floor”) that
would be payable on such day (or if such day is not a Business Day, the
immediately preceding Business Day) for a Eurodollar Term Loan with a one-month
interest period plus (ii) 1.00% per annum; provided that, for the avoidance of
doubt, the Adjusted LIBO Rate for any day shall be based on the rate determined
on such day at approximately 11:00 a.m. (London time) by reference to the
British Bankers’ Association Interest Settlement Rates for deposits in Dollars
(as set forth by any service selected by the Administrative Agent that has been
nominated by the British Bankers’ Association as an authorized vendor for the
purpose of displaying such rates). If the Administrative Agent shall have
determined (which determination shall be conclusive absent manifest error) that
it is unable to ascertain the Federal Funds Effective Rate for any reason,
including the inability or failure of the Administrative Agent to obtain
sufficient quotations in accordance with the terms of the definition thereof,
the Alternate Base Rate shall be determined without regard to clause (b) of the
preceding sentence until the circumstances giving rise to such inability no
longer exist. Any change in the Alternate Base Rate due to a change in the Prime
Rate or the Federal Funds Effective Rate or the Adjusted LIBO Rate shall be
effective on the effective date of such change in the Prime Rate, the Federal
Funds Effective Rate or the Adjusted LIBO Rate, as the case may be.

 

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“Applicable Margin” shall mean, for any day (a) with respect to any Eurodollar
Term Loan, 7.75% per annum and (b) with respect to any ABR Term Loan, 6.75% per
annum, subject to the provisions of Section 2.06(d).

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

“Asset Sale” shall mean the sale, lease, conveyance, transfer or other
disposition (by way of merger, or otherwise, but excluding Extraordinary
Receipts), including without limitation pursuant to a transaction described in
Section 6.03, by the Borrower or any of the Subsidiaries to any Person (provided
that the sale, lease, conveyance, transfer or other disposition of all or
substantially all of the assets of the Borrower and its Subsidiaries taken as a
whole shall be governed by Section 6.05(a)) other than the Borrower or any
Subsidiary Guarantor of (a) any Equity Interests of any of the Subsidiaries
(other than directors’ qualifying shares) or (b) any other assets of the
Borrower or any of the Subsidiaries; provided that none of the following items
shall be deemed to be an Asset Sale:

(i) investments disposed of in the ordinary course of business;

(ii) (A) the sale or lease of products, services or accounts receivable in the
ordinary course of business, (B) any sale or other disposition of surplus,
damaged, worn-out or obsolete assets or property (including, without limitation,
inventory, immaterial assets and property no longer commercially viable to
maintain and operate) in the ordinary course of business, (C) the granting of
any option or other right to purchase, or otherwise acquire property in the
ordinary course of business, (D) the sale, transfer or other disposition of
power, capacity, energy, ancillary services, and other products or services, or
the sale of any other inventory or contracts related to any of the foregoing,
(E) the sale, lease, conveyance or other disposition for value by the Borrower
or any Subsidiary of fuel or emission credits in the ordinary course of business
and (F) the licensing of intellectual property in the ordinary course of
business;

(iii) dispositions of property subject to a Lien permitted pursuant to
Section 6.02 that is transferred to the lienholder or its designee in
satisfaction or settlement of such lienholder’s claim or a realization upon such
Lien (other than any such property that constitutes Collateral and in respect of
which the Lien in respect thereof securing the Obligations is prior to such
other Lien);

(iv) sales or dispositions resulting from the exercise by a Governmental
Authority of its claimed or actual power of eminent domain or dispositions
otherwise required by applicable law;

(v) any sale, transfer or other disposition of property or assets related to the
decommissioning or demolition of the Havana 1-5 Units, the Wood River 1-3 Units
or the Vermillion Facility;

 

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(vi) investments and Restricted Payments made as permitted by this Agreement;

(vii) sales, transfers or other dispositions (A) between or amongst Intermediate
Holdings, the Borrower and the Subsidiary Guarantors or (B) between or amongst
Subsidiaries of the Borrower that are not Loan Parties, in each case as
permitted by this Agreement; and

(viii) any sale, transfer or other disposition or series of related sales,
transfers or other dispositions having a Fair Market Value not in excess of
$5,000,000.

“Assignment and Assumption” shall mean an assignment and assumption entered into
by a Lender and an Eligible Assignee (with the consent of any party whose
consent is required by Section 9.04), and accepted by the Administrative Agent,
in substantially the form of Exhibit B or such other form as shall be approved
by the Administrative Agent.

“Auction” shall have the meaning assigned to such term in Section 2.12(e).

“Auction Manager” shall have the meaning assigned to such term in
Section 2.12(e).

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

“Borrowed Postings” shall have the meaning assigned to such term in
Section 5.18.

“Borrower” shall have the meaning assigned to such term in the introductory
statement to this Agreement.

“Borrower Materials” shall have the meaning assigned to such term in
Section 9.01.

“Borrowing” shall mean Term Loans of the same Class and Type made, converted or
continued on the same date and, in the case of Eurodollar Term Loans, as to
which a single Interest Period is in effect.

“Borrowing Request” shall mean the request by the Borrower in accordance with
the terms of Section 2.03 and substantially in the form of Exhibit C, or such
other form as shall be approved by the Administrative Agent.

“Breakage Event” shall have the meaning assigned to such term in Section 2.16.

“Business Day” shall mean any day other than a Saturday, Sunday or day on which
banks in New York City are authorized or required by law to close; provided,
however, that when used in connection with a Eurodollar Term Loan, the term
“Business

 

5

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Day” shall also exclude any day on which banks are not open for dealings in
Dollar deposits in the London interbank market.

“CapEx Pullback Amount” shall have the meaning assigned to such term in
Section 6.10(c).

“Capital Expenditures” shall mean, for any period, (a) the additions to
property, plant and equipment and other capital expenditures of the Borrower and
its consolidated Subsidiaries that are (or should be) set forth in a
consolidated statement of cash flows of the Borrower for such period prepared in
accordance with GAAP and (b) Capital Lease Obligations or Synthetic Lease
Obligations incurred by the Borrower and its consolidated Subsidiaries during
such period, but excluding in each case any such expenditure made to restore,
replace or rebuild property to the condition of such property immediately prior
to any damage, loss, destruction or condemnation of such property, to the extent
such expenditure is made with insurance proceeds, condemnation awards or damage
recovery proceeds relating to any such damage, loss, destruction or condemnation
provided that: (a) the purchase price of equipment or property that is
(i) purchased substantially simultaneously with the trade-in of existing
equipment or property, (ii) exchanged in connection with a swap of existing
equipment or property or (iii) purchased or repaired with insurance proceeds
and/or deductibles (promptly following receipt thereof on account of such
property or equipment being replaced or repaired) shall be included in Capital
Expenditures only to the extent of the gross amount by which such purchase price
exceeds the credit granted by the seller of such equipment or property for the
equipment or property being so repaired, traded in or exchanged or the amount of
such insurance proceeds and/or deductibles, as the case may be and (b) any
expenditure funded with warranty proceeds, proceeds from an indemnity claim,
settlement payments or any other payments made to compensate such Person for any
damage, defect, delay or loss relating to the expenditure being made shall not
be included in Capital Expenditures to the extent such expenditure does not
exceed the applicable proceeds or payments.

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

“Cash Collateralized Letter of Credit and Reimbursement Agreement” shall mean
any letter of credit and reimbursement agreement executed by the Borrower with
Credit Suisse and Barclays Bank PLC on the date of this Agreement or such other
form as is proposed by the Borrower and reasonably acceptable to the
Administrative Agent.

“Cash Collateralized Letters of Credit” shall mean the letters of credit issued
pursuant to any Cash Collateralized Letter of Credit and Reimbursement
Agreement.

 

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“Cash Management Agreement” shall mean the Cash Management Agreement dated as of
August 5, 2011 among Dynegy Administrative Services Company, the Borrower and
certain of the Borrower’s Affiliates.

A “Change in Control” shall be deemed to have occurred if (a) the Parent shall
cease to directly or indirectly own beneficially and of record, 50.1% of the
issued and outstanding Equity Interests having ordinary voting power of the
Borrower, (b) Intermediate Holdings shall cease to directly or indirectly own,
beneficially and of record, at least 100% of the issued and outstanding Equity
Interests of the Borrower or (c) direct or indirect ownership of the Borrower
shall have been transferred directly or indirectly from DHI and its Wholly Owned
Subsidiaries to any direct or indirect subsidiary of the Parent other than DHI
and its Wholly Owned Subsidiaries; provided, that such transfer shall not be
deemed to be a “Change of Control” to the extent it is duly authorized as lawful
by the board of directors of the Parent.

“Change in Law” shall mean the occurrence, after the date of this Agreement, of
any of the following: (a) the adoption or taking effect of any law, rule,
regulation or treaty, (b) any change in any law, rule, regulation or treaty or
in the administration, interpretation, implementation or application thereof by
any Governmental Authority or (c) the making or issuance of any request, rule,
guideline or directive (whether or not having the force of law) by any
Governmental Authority; provided that notwithstanding anything herein to the
contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and
all requests, rules, guidelines or directives thereunder or issued in connection
therewith and (y) all requests, rules, guidelines or directives promulgated by
the Bank for International Settlements, the Basel Committee on Banking
Supervision (or any successor or similar authority) or the United States or
foreign regulatory authorities, in each case pursuant to Basel III, shall in
each case be deemed to be a “Change in Law”, regardless of the date enacted,
adopted or issued.

“Charges” shall have the meaning assigned to such term in Section 9.09.

“Class”, when used in reference to any Term Loan or Borrowing, refers to whether
such Term Loan, or the Term Loans comprising such Borrowing, are Term Loans of
the same or differing maturities or economic terms.

“Closing Date” shall mean the date each of the conditions set forth in Article
IV are satisfied (or waived in accordance with the terms hereof), which date is
August 5, 2011.

“Co-Documentation Agents” shall have the meaning assigned to such term in the
introductory statement to this Agreement.

“Co-Manager” shall have the meaning assigned to such term in the introductory
statement to this Agreement.

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

 

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“Collateral” shall mean all the “Collateral” as defined in any Security Document
and shall also include the Mortgaged Properties.

“Collateral Posting Account” shall have the meaning set forth in Section 5.18.

“Collateral Posting Amount” shall mean, at any time, the sum of
(x) $118,000,000, as such amount is reduced from time to time in accordance with
Section 2.13(f), plus (y) any amount deducted from Excess Cash Flow pursuant to
clause (b)(xi) of the definition thereof.

“Collateral Trustee” shall have the meaning assigned to such term in the
introductory statement to this Agreement.

“Commodity Collateral Amounts” shall mean at any time, (i) cash and Permitted
Investments pledged or deposited as collateral to or for the benefit of (x) a
contract counterparty or (y) a letter of credit provider in connection with a
Cash Collateralized Letter of Credit and Reimbursement Agreement in respect of a
letter of credit issued to any contract counterparty, in each case by the
Borrower or any Subsidiary Guarantor and (ii) letters of credit issued under the
Indebtedness permitted by Section 6.01(i), in each case as security for any of
its respective obligations under any contract for commercial and trading
activities and contracts (including physical delivery, option (whether cash or
financial), exchange, swap and futures contracts) for the purchase,
transmission, transportation, distribution, sale, lease or hedge of any
fuel-related or power-related commodity or service.

“Commodity Hedging Agreements” shall mean any agreement (including each
confirmation entered into pursuant to any master agreement) providing for swaps,
caps, collars, puts, calls, floors, futures, options, spots, forwards, power
purchase or sale agreements, fuel purchase or sale agreements, tolling
agreements, emissions credit purchase or sales agreements, power transmission
agreements, fuel transportation agreements, fuel storage agreements, netting
agreements, commercial or trading agreements, weather derivatives agreements,
each with respect to, or involving the purchase, transmission, distribution,
sale, lease or hedge of, any energy, generation capacity or fuel, or any other
energy or weather related commodity, service or risk, price or price indices for
any such commodities, services or risks or any other similar derivative
agreements, any renewable energy credits, carbon emission credits and any other
“cap and trade” related credits, assets or attributes with an economic value and
any other similar agreements, entered into by the Borrower or any Subsidiary, in
each case under this definition, (i) in the ordinary course of business, or
(ii) otherwise consistent with Prudent Industry Practice in order to manage
fluctuations in the price or availability to the Borrower or any Subsidiary of
any commodity and/or manage the risk of adverse or unexpected weather
conditions.

“Commodity Hedging Obligations” shall mean, with respect to any specified
Person, the obligations of such Person under a Commodity Hedging Agreement.

“Communications” shall have the meaning assigned to such term in Section 9.01.

 

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“Confidential Information Memorandum” shall mean the Confidential Information
Memorandum of the Borrower dated July 11, 2011.

“Consolidated EBITDA” shall mean, for any period, Consolidated Net Income for
such period plus (a) without duplication and to the extent deducted in
determining such Consolidated Net Income, the sum of (i) Consolidated Interest
Expense for such period, (ii) consolidated income tax expense for such period,
(iii) all amounts attributable to depreciation and amortization for such period,
(iv) any non-cash charges and adjustments (other than the write-down of current
assets) for such period to the extent deducted from such Consolidated Net
Income, and (v) fees and expenses payable in cash on or prior to the Closing
Date with respect to the Reorganization, and minus (b) without duplication
(i) all cash payments made during such period and any non-cash charges and
adjustments added to Consolidated Net Income pursuant to clause (a)(iv) above in
a previous period and (ii) to the extent included in determining such
Consolidated Net Income, any extraordinary gains and all non-cash items of
income for such period, all determined on a consolidated basis in accordance
with GAAP.

“Consolidated Interest Expense” shall mean, for any period, the sum of (a) the
interest expense (including imputed interest expense in respect of Capital Lease
Obligations and Synthetic Lease Obligations) of the Borrower and the
Subsidiaries for such period (including all commissions, discounts and other
fees and charges owed by the Borrower and its Subsidiaries with respect to
letters of credit and bankers acceptance financing), determined on a
consolidated basis in accordance with GAAP, plus (b) any interest accrued during
such period in respect of Indebtedness of the Borrower or any Subsidiary that is
required to be capitalized rather than included in consolidated interest expense
for such period in accordance with GAAP. For purposes of the foregoing, interest
expense shall be determined after giving effect to any net payments made or
received by the Borrower or any Subsidiary with respect to Interest
Rate/Currency Hedging Agreements.

“Consolidated Net Income” shall mean, for any period, the net income or loss of
the Borrower and the Subsidiaries for such period determined on a consolidated
basis in accordance with GAAP (adjusted to reflect any charge, tax or expense
incurred or accrued by Intermediate Holdings, or any direct holding company
thereof, during such period as though such charge, tax or expense had been
incurred by the Borrower, to the extent that the Borrower has made or would be
entitled under Section 6.06(a)(iii)(A) to make any payment to or for the account
of Intermediate Holdings in respect thereof); provided that there shall be
excluded (a) the income of any Subsidiary to the extent that the declaration or
payment of dividends or similar distributions by the Subsidiary of that income
is not at the time permitted by operation of the terms of its charter or any
agreement, instrument, judgment, decree, statute, rule or governmental
regulation applicable to such Subsidiary, (b) the income or loss of any Person
accrued prior to the date it becomes a Subsidiary or is merged into or
consolidated with the Borrower or any Subsidiary on the date that such Person’s
assets are acquired by the Borrower or any Subsidiary, (c) the income of any
Person in which any other Person (other than the Borrower or a Wholly Owned
Subsidiary or any director holding qualifying shares in accordance with
applicable law) has a joint interest, except to the extent of the amount of

 

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dividends or other distributions actually paid to the Borrower or a Wholly Owned
Subsidiary by such Person during such period, and (d) any gains attributable to
Asset Sales or other sales of assets out of the ordinary course of business.

“Control” 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 ability to exercise voting power, by contract or otherwise.
“Controlling” and “Controlled” have meanings correlative thereto.

“Control Agreement” shall mean a customary account control agreement in form and
substance reasonably satisfactory to the Collateral Trustee pursuant to which
the depositary institution maintaining the relevant account agrees that the
Collateral Trustee to have “control” (as defined in Section 8-106 of the UCC, as
such term relates to investment property (other than certificated securities or
commodity contracts), or as used in Section 9-106 of the UCC, as such term
relates to commodity contracts, or as used in Section 9-104(a) of the UCC, as
such term relates to deposit accounts) and pursuant to which such depositary
institution shall agree to comply solely with the Collateral Trustee’s
instructions with respect to the disposition of funds in such account upon the
occurrence and continuance of an Event of Default and without the consent of any
other Person.

“Credit Facilities” shall mean the term loan facilities provided for by this
Agreement.

“Credit Suisse” shall have the meaning assigned to such term in the introductory
statement to this Agreement.

“Current Assets” shall mean, at any time, the consolidated current assets (other
than cash, Permitted Investments and Commodity Collateral Amounts and any asset
associated therewith) of the Borrower and the Subsidiaries.

“Current Extension Loans” shall have the meaning assigned to such term in
Section 2.22(c).

“Current Liabilities” shall mean, at any time, the consolidated current
liabilities of the Borrower and the Subsidiaries at such time, but excluding,
without duplication, the current portion of any long-term Indebtedness and any
Commodity Collateral Amounts and any liabilities associated therewith.

“Debtor Relief Laws” shall mean the Bankruptcy Code of the United States of
America, and all other liquidation, conservatorship, bankruptcy, assignment for
the benefit of creditors, moratorium, rearrangement, receivership, insolvency,
reorganization, or similar debtor relief Laws of the United States or other
applicable jurisdictions from time to time in effect.

“Default” shall mean any event or condition which upon notice, lapse of time or
both would constitute an Event of Default.

 

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“Defaulting Lender” shall mean any Lender that has, or has a direct or indirect
parent company that has, (a) become the subject of a proceeding under any Debtor
Relief Law or (b) had appointed for it a receiver, custodian, conservator,
trustee, administrator, assignee for the benefit of creditors or similar Person
charged with reorganization or liquidation of its business or assets, including
the Federal Deposit Insurance Corporation or any other state or federal
regulatory authority acting in such a capacity; provided that a Lender shall not
be a Defaulting Lender solely by virtue of the ownership or acquisition of any
equity interest in that Lender or any direct or indirect parent company thereof
by a Governmental Authority so long as such ownership interest does not result
in or provide such Lender with immunity from the jurisdiction of courts within
the United States or from the enforcement of judgments or writs of attachment on
its assets or permit such Lender (or such Governmental Authority) to reject,
repudiate, disavow or disaffirm any contracts or agreements made with such
Lender. Any determination by the Administrative Agent that a Lender is a
Defaulting Lender as described above shall be conclusive and binding absent
manifest error, and such Lender shall be deemed to be a Defaulting Lender upon
delivery of written notice of such determination to the Borrower and each
Lender.

“DHI” shall mean Dynegy Holdings, Inc., a Delaware corporation.

“Disqualified Lender” shall mean (a) any competitor of the Parent or its
subsidiaries that owns and operates independent power plants (a “Competitor”)
and (b) any Person (other than any Person that is primarily a financial
investor) who directly or indirectly owns a majority of the Equity Interests of
a Competitor or is a direct or indirect subsidiary of a Competitor, in the case
of the foregoing clauses (a) and (b), designated in writing by the Borrower in
consultation with and reasonably acceptable to the Joint Lead Arrangers;
provided that no Person shall be a “Disqualified Lender” unless such Person is
specifically identified in writing by the Parent to the Joint Lead Arrangers
prior to July 11, 2011 (such list, the “Disqualified Lender List”), which list
may be distributed to each Lender; provided that following the Closing Date the
Borrower may update the entities described in clauses (a) and (b) above not more
than four times each year, with the consent of the Administrative Agent, not to
be unreasonably withheld, with such new Disqualified Lender List becoming
effective 10 days after approval of such list by the Administrative Agent.

“Disqualified Stock” shall mean any Equity Interest that, by its terms (or by
the terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, (a) matures (excluding any
maturity as the result of an optional redemption by the issuer thereof) or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or
is redeemable at the option of the holder thereof, in whole or in part, or
requires the payment of any cash dividend or any other scheduled payment
constituting a return of capital, in each case at any time on or prior to the
first anniversary of the Term Loan Maturity Date, or (b) is convertible into or
exchangeable (unless at the sole option of the issuer thereof) for (i) debt
securities or (ii) any Equity Interest referred to in clause (a) above, in each
case at any time prior to the first anniversary of the Term Loan Maturity Date.

 

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“Dollars” or “$” shall mean lawful money of the United States of America.

“Domestic Subsidiaries” shall mean all Subsidiaries incorporated or organized
under the laws of the United States of America, any State thereof or the
District of Columbia.

“DPM” shall mean Dynegy Power Marketing, LLC, a Delaware limited liability
company.

“Eligible Assignee” shall mean any Person (other than a natural Person) that
meets the requirements to be an assignee under Sections 9.04(b)(iii), (v) and
(vi) (subject to such consents, if any, as may be required under
Section 9.04(b)(iii)).

“Eligible Commodity Hedging Agreement” shall mean any Commodity Hedging
Agreement entered into by the Borrower or any Subsidiary Guarantor with an
Eligible Commodity Hedging Counterparty, which, individually or together with
other Commodity Hedging Agreements (other than Commodity Hedging Agreements that
are either unsecured, are supported by letters of credit or Guarantees from
Persons that are not Loan Parties (but, in each case, not secured by all or
substantially all of the assets of any Loan Party)) entered into or being
entered into with such counterparty or its affiliates, is at the time entered
into reasonably expected to hedge the anticipated exposure of the Borrower or
the relevant Subsidiary Guarantor(s) to one or more commodity price risks
relating to the business and operations of the Borrower or the relevant
Subsidiary Guarantor; provided that any Commodity Hedging Agreement that is
entered into to offset all or any portion of an outstanding Eligible Commodity
Hedging Agreement shall constitute an Eligible Commodity Hedging Agreement so
long as, at the time entered into, such offsetting Commodity Hedging Agreement,
together with all other outstanding Eligible Commodity Hedging Agreements, in
the aggregate, are reasonably expected to hedge the anticipated exposure of the
Borrower or the relevant Subsidiary Guarantor(s) to one or more commodity price
risks relating to the business and operations of the Borrower or the relevant
Subsidiary Guarantor. “Eligible Commodity Hedging Counterparty” shall mean a
counterparty to an Eligible Commodity Hedging Agreement that, at the time the
relevant Eligible Commodity Hedging Agreement is entered into, is either an
Acceptable Commodity Counterparty or an Acceptable Financial Counterparty.

“Eligible Commodity Hedging Counterparty” shall mean a counterparty to an
Eligible Commodity Hedging Agreement that, at the time the relevant Eligible
Commodity Hedging Agreement is entered into, is either an Acceptable Commodity
Counterparty or an Acceptable Financial Counterparty.

“Eligible Commodity Hedging Obligations” shall mean, with respect to any
specified Person, the obligations of such Person under an Eligible Commodity
Hedging Agreement.

 

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“Energy Management Agreement” shall mean any of the Energy Management Services
Agreements dated as of August 5, 2011 among DPM and the Borrower or any of its
Subsidiaries.

“Engagement Letter” shall mean the Engagement Letter dated July 7, 2011, between
the Borrower and the Joint Lead Arrangers.

“Environmental Laws” shall mean all Federal, state, local and foreign laws
(including common law), treaties, regulations, rules, ordinances, codes,
decrees, judgments, directives, orders (including consent orders), and
agreements relating to either the protection of the environment or natural
resources, the protection of human health and safety (as such relate to the
exposure to Hazardous Materials), or the presence, Release of, or exposure to,
Hazardous Materials, or the generation, manufacture, processing, distribution,
use, treatment, storage, transport, recycling or handling of, or the arrangement
for such activities with respect to, Hazardous Materials.

“Environmental Liability” shall mean all liabilities, obligations, damages,
losses, claims, actions, suits, judgments, orders, fines, penalties, fees,
expenses and costs (including administrative oversight costs, natural resource
damages and remediation costs), whether contingent or otherwise, arising out of
or relating to (a) non-compliance with any Environmental Law, (b) the
generation, use, handling, transportation, storage, treatment or disposal of any
Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the Release of
any Hazardous Materials or (e) any contract, agreement or other consensual
arrangement pursuant to which liability is assumed or imposed with respect to
any of the foregoing.

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

“Equity Issuance” shall mean any issuance or sale by the Borrower or any
Subsidiary of any Equity Interests of the Borrower or any Subsidiary, as
applicable, except in each case for (a) any issuance or sale to the Borrower or
any Subsidiary, (b) any issuance of directors’ qualifying shares and (c) sales
or issuances of common stock of the Borrower or any Subsidiary to management or
employees of the Borrower or such Subsidiary under any employee stock option or
stock purchase plan or employee benefit plan in existence from time to time.

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time, the regulation promulgated thereunder and any
successor statute.

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

 

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“ERISA Event” shall mean (a) any “reportable event”, as defined in Section 4043
of ERISA or the regulations issued thereunder, with respect to a Plan (other
than an event for which the 30-day notice period is waived), (b) the existence
with respect to any Plan of a failure to satisfy the minimum funding standard
(as set forth in Sections 412 and 430 of the Code or Sections 302 and 303 of
ERISA), in each case, whether or not waived, (c) the filing pursuant to
Section 412(c) of the Code or Section 302(c) of ERISA of an application for a
waiver of the minimum funding standard with respect to any Plan, (d) a
determination that any Plan is, or is reasonably expected to be, in “at risk”
status (as defined in Section 430 of the Code or Section 303 of ERISA); (e) the
incurrence by the Borrower or any of its ERISA Affiliates of any liability under
Title IV of ERISA with respect to the termination of any Plan or the withdrawal
or partial withdrawal of the Borrower or any of its ERISA Affiliates from any
Multiemployer Plan, (f) the receipt by the Borrower or any of its ERISA
Affiliates from the PBGC or a plan administrator of any notice relating to the
intention to terminate any Plan or Plans or to appoint a trustee to administer
any Plan pursuant to Section 4042 of ERISA, (g) the adoption of any amendment to
a Plan that would require the provision of security pursuant to Section 436(f)
of the Code, (h) the receipt by the Borrower or any of its ERISA Affiliates of
any notice imposing Withdrawal Liability or that a Multiemployer Plan is, or is
reasonably expected to be, in “critical” or “endangered” status under
Section 432 of the Code or Section 305 of ERISA; (i) the occurrence of a
non-exempt “prohibited transaction” within the meaning of Section 4975 of the
Code or Section 406 of ERISA with respect to a Plan and with respect to which
the Borrower or any Subsidiary incurs liability, (j) the imposition of a Lien
pursuant to Section 430(k) of the Code or pursuant to Section 303(k) of ERISA,
or a violation of Section 436 of the Code, with respect to any Plan or (k) any
other event or condition with respect to a Plan or Multiemployer Plan that would
reasonably be expected to result in liability of the Borrower or any Subsidiary
under Title IV of ERISA (other than contributions to a Plan or premiums to the
PBGC in the ordinary course).

“Eurodollar”, when used in reference to any Term Loan or Borrowing, refers to
whether such Term Loan, or the Terms Loans comprising such Borrowing, are
bearing interest at a rate determined by reference to the Adjusted LIBO Rate.

“Events of Default” shall have the meaning assigned to such term in Article VII.

“Excess Cash Flow” shall mean, for any fiscal year of the Borrower, commencing
with the fiscal year ending December 31, 2012, the excess of (a) the sum,
without duplication, of (i) Consolidated EBITDA for such fiscal year,
(ii) reductions to noncash working capital of the Borrower and the Subsidiaries
for such fiscal year (i.e., the decrease, if any, in Current Assets minus
Current Liabilities from the beginning to the end of such fiscal year) and
(iii) to the extent not included in the determination of Consolidated Net
Income, any termination payments or similar payments received by the Borrower or
any Subsidiaries during such fiscal year in connection with the termination,
partial termination or other reduction of any Hedging Obligations over (b) the
sum, without duplication, of (i) the maximum amounts of payments permitted to be
made pursuant to Section 6.06(a)(ii) and Section 6.06(a)(iii)(B) and (C) (and
for the avoidance of doubt, Section 6.06(a)(iv) to the extent such amounts are
included in Consolidated

 

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EBITDA) with respect to such fiscal year, (ii) Consolidated Interest Expense for
such fiscal year, (iii) Capital Expenditures made in cash in accordance with
Section 6.10 during such fiscal year, except to the extent financed with the
proceeds of Indebtedness, equity issuances, casualty proceeds, condemnation
proceeds or proceeds of Asset Sales, (iv) permanent repayments of the Term Loans
(other than mandatory prepayments of Terms Loans under Section 2.13) made in
cash by the Borrower and the Subsidiaries during such fiscal year (v) additions
to noncash working capital for such fiscal year (i.e., the increase, if any, in
Current Assets minus Current Liabilities from the beginning to the end of such
fiscal year), (vi) repayments of principal by the Borrower and its Subsidiaries
during such fiscal year in respect of principal amount of Indebtedness (other
than repayments of Term Loans), but only to the extent that the Indebtedness so
prepaid by its terms cannot be reborrowed or redrawn, (vii) the aggregate amount
of expenditures (including without limitation cash payments made in advance of
an expense set forth in this clause (b) and upfront payments for insurance)
actually made by the Borrower and its Subsidiaries in cash during such fiscal
year (including expenditures for the payment of financing fees) to the extent
that such expenditures are not expensed during such period, (viii) the aggregate
amount of any premium, make-whole or penalty payments actually paid in cash by
the Borrower and its Subsidiaries during such fiscal year that are required to
be made in connection with any prepayment of Indebtedness, (ix) to the extent
not included in the determination of Consolidated Net Income, any termination
payments or similar payments made by the Borrower or any of its Subsidiaries
during such fiscal year in connection with the termination, partial termination
or other reduction of any Hedging Obligations, (x) $5,000,000 per annum unless
at the end of such fiscal year the Borrower has in effect any revolving credit
or similar facilities in an aggregate principal (or available) amount of at
least $10,000,000, (xi) at the Borrower’s option, amounts for such fiscal year
not to exceed, in the aggregate for all fiscal years, the sum of
(A) $100,000,000 plus (B) the amount of the Term Loans previously prepaid
pursuant to Section 2.13(f); provided that the amount of any reduction pursuant
to this clause (xi) shall increase the Collateral Posting Amount in accordance
with the definition thereof, and (xii) the repurchase and cancellation of any
Term Loans by the Borrower pursuant to Section 2.12(e)(iii) and
Section 2.12(e)(iv). For the avoidance of doubt, changes in the Commodity
Collateral Amounts shall be excluded from Excess Cash Flow.

“Excluded Assets” shall have the meaning assigned to such term in the Guarantee
and Collateral Agreement.

“Excluded Obligations” shall mean obligations existing as of the Closing Date
and set forth on Schedule 1.01(c) to the extent such obligations (a) were not
included on the balance sheet of the Borrower and its Subsidiaries as
indebtedness at the time such other obligation was entered into and (b) were
subsequently recharacterized for accounting purposes as indebtedness.

“Excluded Taxes” shall mean, with respect to the Administrative Agent, any
Lender or any other recipient of any payment to be made by or on account of any
obligation of the Borrower hereunder or pursuant to any Loan Document,
(a) income or franchise taxes imposed on or measured by its net income or net
profits, however denominated, by the jurisdiction under the laws of which such
recipient is organized or in

 

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which its principal office is located or, in the case of any Lender, in which
its applicable lending office is located, or that are imposed by reason of any
connection between the Administrative Agent, Lender or other recipient and any
taxing jurisdiction other than a connection arising solely by executing or
entering into any Loan Document, receiving payments thereunder or having been a
party to, performed its obligations under, or enforced, any Loan Documents,
(b) any branch profits taxes imposed by the United States of America or any
similar tax imposed by any other jurisdiction described in clause (a) above,
(c) in the case of a Foreign Lender (other than an assignee pursuant to a
request by the Borrower under Section 2.21(a)), any U.S. federal withholding tax
or backup withholding that is imposed pursuant to laws in effect at the time
such Foreign Lender becomes a party to this Agreement (or designates a new
lending office), except to the extent that such Foreign Lender (or its assignor,
if any) was entitled, at the time of designation of a new lending office (or
assignment), to receive additional amounts with respect to such withholding tax
pursuant to Section 2.20(a), (d) in the case of a Foreign Lender any U.S.
federal withholding tax or backup withholding that is attributable to such
Foreign Lender’s failure to comply with Sections 2.20(e) or (f), (e) any U.S
federal withholding tax imposed pursuant to FATCA and (f) all penalties and
interest on the foregoing amounts.

“Existing Credit Facility” shall mean the Fifth Amended and Restated Credit
Agreement dated as of April 2, 2007 among DHI, as the borrower, Dynegy Inc., as
the parent, Dynegy Illinois Inc., as the intermediate parent, the other
guarantors party thereto, the lenders party thereto, Citicorp USA, Inc. and
JPMorgan Chase Bank, N.A., as administrative agents, Citicorp USA, Inc., as
payment agent, JPMorgan Chase Bank, N.A., as collateral agent, and JPMorgan
Chase Bank, N.A. and Citibank, N.A., as revolving l/c issuers and term l/c
issuers.

“Extended Maturity Date” shall have the meaning assigned to such term in
Section 2.22(a).

“Extension” shall have the meaning assigned to such term in Section 2.22(a).

“Extension Amendments” shall have the meaning assigned to such term in
Section 2.22(e).

“Extension Offer” shall have the meaning assigned to such term in
Section 2.22(a).

“Extraordinary Receipt” shall mean any cash received by or paid to or for the
account of any Loan Party not in the ordinary course of business, representing
proceeds of casualty insurance (excluding proceeds of business interruption
insurance) or condemnation awards (and payments in lieu thereof) in excess of
$10,000,000 in respect of any such loss or series of events giving rise to such
proceeds.

“Fair Market Value” shall mean the value that would be paid by a willing buyer
to an unaffiliated willing seller in a transaction not involving distress or
necessity of

 

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either party, determined by or on behalf of, in good faith, an appropriate
officer or Board of Directors of the Person required to make such determination.

“FATCA” shall mean Sections 1471 through 1474 of the Code (as of the date hereof
or any amended or successor provision that is substantially comparable and not
materially more onerous to comply with) and any regulations or other official
interpretations thereof.

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

“FERC” shall mean the Federal Energy Regulatory Commission.

“Financial Officer” of any Person shall mean the chief financial officer of such
Person.

“Financial Statement Delivery Failure” shall mean the failure of the Borrower to
deliver (a) for the fiscal year ending December 31, 2011, any of the information
described in 5.04(a) on or prior to April 15, 2012, (b) for the fiscal quarter
ending September 30, 2011, any of the information described in 5.04(b) on or
prior to November 30, 2011, (c) for the fiscal quarter ending March 31, 2012,
any of the information described in 5.04(b) on or prior to May 30, 2012 or
(d) for the fiscal quarter ending June 30, 2012, any of the information
described in 5.04(b) on or prior to August 30, 2012.

“Financial Statement Margin Increase” shall mean, for any day, on or prior to
April 15, 2012, 0.25% per annum, for any day after April 15, 2012, and on or
prior to June 1, 2012, 0.50% per annum and for any day after June 1, 2012, 0,75%
per annum.

“Flood Certificate” shall mean a “Standard Flood Hazard Determination Form” of
the Federal Emergency Management Agency and any successor Governmental Authority
performing a similar function.

“Flood Program” shall mean the National Flood Insurance Program created by the
U.S. Congress pursuant to the National Flood Insurance Act of 1968, the Flood
Disaster Protection Act of 1973, the National Flood Insurance Reform Act of 1994
and the Flood Insurance Reform Act of 2004, in each case as amended from time to
time, and any successor statutes.

“Flood Zone” shall mean areas having special flood hazards as described in the
National Flood Insurance Act of 1968, as amended from time to time, and any
successor statute.

 

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“Foreign Lender” shall mean any Lender that is not a “United States person” as
defined in Section 7701(a)(30) of the Code.

“FPA” shall mean the Federal Power Act.

“GAAP” shall mean United States generally accepted accounting principles as in
effect from time to time.

“GasCo” shall mean Dynegy Power, LLC, a Delaware limited liability company.

“GasCo Transactions” shall mean, collectively, (a) the execution, delivery and
performance by Dynegy Gas Investments Holdings, LLC, GasCo and its subsidiaries
of the Reorganization Documents and the consummation of the transactions
contemplated thereby, (b) the execution, delivery and performance by them of the
loan documentation in respect of the term loan facilities described in paragraph
(s) of Article IV and the extensions of credit thereunder, (c) the repayment of
all amounts due or outstanding under or in respect of, and the termination of,
the Existing Credit Facility and (d) the payment of related fees and expenses.

“Governmental Authority” shall mean the government of the United States of
America or any other nation, or of any political subdivision thereof, whether
state or local, and any agency, authority, instrumentality, regulatory body,
court, central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government (including any supra-national bodies such as the European Union or
the European Central Bank).

“Granting Lender” shall have the meaning assigned to such term in
Section 9.04(i).

“Group Member” shall mean, collectively, the Parent, Holdings, Intermediate
Holdings and each of their respective subsidiaries.

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

 

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“Guarantee and Collateral Agreement” shall mean the Guarantee and Collateral
Agreement, substantially in the form of Exhibit D, among the Borrower, the
Subsidiaries party thereto and the Collateral Trustee for the benefit of the
Secured Parties.

“Havana 1-5 Units” shall mean the decommissioned units 1 through 5 located at
the power generation facility owned by the Borrower and located in Mason County,
Illinois.

“Hazardous Materials” shall mean (a) any petroleum products or byproducts and
all other hydrocarbons, radon gas, asbestos, urea formaldehyde foam insulation,
polychlorinated biphenyls, chlorofluorocarbons and all other ozone-depleting
substances and (b) any chemical, material, substance or waste that is
prohibited, limited or regulated as a pollutant, contaminant, or as “hazardous,”
or “toxic” (or terms of similar intent or meaning), by or pursuant to any
Environmental Law.

“Hedging Obligations” shall mean, with respect to any specified Person, the
obligations of such Person under (a) interest rate swap agreements (whether from
fixed to floating or from floating to fixed), interest rate cap agreements and
interest rate collar agreements, (b) other agreements or arrangements designed
to manage interest rates or interest rate risk, (c) other agreements or
arrangements designed to protect such Person against fluctuations in currency
exchange rates and (d) agreements (including each confirmation entered into
pursuant to any master agreement) providing for swaps, caps, collars, puts,
calls, floors, futures, options, spots, forwards, power purchase or sale
agreements, fuel purchase or sale agreements, emissions credit purchase or sales
agreements, power transmission agreements, fuel transportation agreements, fuel
storage agreements, netting agreements, tolling agreements, commercial or
trading agreements, each with respect to, or involving the purchase,
transmission, distribution, sale, lease or hedge of, any energy, generation
capacity or fuel, or any other energy related commodity or service, price or
price indices for any such commodities or services or any other similar
derivative agreements, and any other similar agreements, in each case under
clauses (a), (b), (c) and (d), entered into by such Person, including Commodity
Hedging Obligations, Eligible Commodity Hedging Obligations and Interest
Rate/Currency Hedging Obligations.

“Holdings” shall mean Dynegy Coal Holdco, LLC, a Delaware limited liability
company and the parent of Intermediate Holdings.

“Immaterial Subsidiary” shall mean any Subsidiary that has assets with a book
value not in excess of $50,000,000 in the aggregate for all Immaterial
Subsidiaries.

“Indebtedness” of any Person shall mean, without duplication, (a) all
obligations of such Person for borrowed money or with respect to deposits or
advances of any kind, (b) all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments, (c) all obligations of such Person
upon which interest charges are customarily paid (excluding trade accounts
payable and accrued obligations incurred in the ordinary course of business and
tax liabilities), (d) all obligations of such Person under conditional sale or
other title retention agreements relating to property or assets

 

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purchased by such Person, (e) all obligations of such Person issued or assumed
as the deferred purchase price of property or services (excluding trade accounts
payable and accrued obligations incurred in the ordinary course of business),
(f) all Indebtedness of others secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be secured by)
any Lien on property owned or acquired by such Person, whether or not the
obligations secured thereby have been assumed, (g) all Guarantees by such Person
of Indebtedness of others, (h) all Capital Lease Obligations of such Person,
(i) all Synthetic Lease Obligations of such Person, (j) net obligations of such
Person in respect of its Hedging Obligations, valued at the Agreement Value
thereof, (k) all obligations of such Person to purchase, redeem, retire, defease
or otherwise make any payment in respect of any Equity Interests of such Person
or any other Person or any warrants, rights or options to acquire such equity
interests, valued, in the case of redeemable preferred interests, at the greater
of its voluntary or involuntary liquidation preference plus accrued and unpaid
dividends, (l) all obligations of such Person as an account party in respect of
letters of credit, (m) all obligations of such Person in respect of bankers’
acceptances, (n) net cash payment obligations of such Person with respect to any
forward sale, prepayment or similar contract or Hedging Obligations in each case
pursuant to which the Borrower or any of its Subsidiaries has received a
prepayment by a counterparty thereto and (o) other transactions entered into by
such Person that are not otherwise addressed in the definition of “Indebtedness”
that are intended to function primarily as a borrowing of funds (including any
minority interest transactions that function primarily as a borrowing); provided
that “Indebtedness” shall exclude (i) in the case of clause (n) of this
definition, spot and forward purchase and sales contracts that are entered into
in the ordinary course of the Borrower’s or any of its Subsidiaries’ trading or
power generation businesses and not intended to function primarily as a
borrowing of funds and (ii) all Excluded Obligations. The Indebtedness of any
Person shall include the Indebtedness of any partnership in which such Person is
a general partner except to the extent expressly non-recourse to such Person.

“Indemnified Taxes” shall mean (a) Taxes other than Excluded Taxes, imposed on
or with respect to any payment made by or on account of any obligation of the
Borrower hereunder or under any other Loan Document or any other Loan Party
hereunder or under any other Loan Document and (b) to the extent not otherwise
described in (a), Other Taxes.

“Indemnitee” shall have the meaning assigned to such term in Section 9.05(b).

“Independent Manager” (a) with respect to the Borrower, shall have the meaning
set forth in its Limited Liability Company Operating Agreement, (b) with respect
to Intermediate Holdings, shall have the meaning set forth in its Limited
Liability Company Operating Agreement and (c) with respect to Holdings, shall
have the meaning set forth in its Limited Liability Company Operating Agreement.

“Information” shall have the meaning assigned to such term in Section 9.16.

“Intercreditor Agreement” shall mean that certain Collateral Trust and
Intercreditor Agreement dated as the date hereof among the Borrower,
Intermediate

 

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Holdings, the Subsidiary Guarantors, the Collateral Trustee and each other
Person from time to time party thereto.

“Interest Payment Date” shall mean (a) with respect to any ABR Term Loan, the
last Business Day of each March, June, September and December, and (b) with
respect to any Eurodollar Term Loan, the last day of the Interest Period
applicable to the Borrowing of which such Term Loan is a part and, in the case
of a Eurodollar Borrowing with an Interest Period of more than three months’
duration, each day that would have been an Interest Payment Date had successive
Interest Periods of three months’ duration been applicable to such Borrowing.

“Interest Period” shall mean, with respect to any Eurodollar Borrowing, the
period commencing on the date of such Borrowing and ending on the numerically
corresponding day (or, if there is no numerically corresponding day, on the last
day) in the calendar month that is 1, 2, 3 or 6 months, or, to the extent agreed
by each Lender of such Eurodollar Borrowing, 9 or 12 months or less than one
month thereafter, as the Borrower may elect; provided, however, that (a) if any
Interest Period would end on a day other than a Business Day, such Interest
Period shall be extended to the next succeeding Business Day unless such next
succeeding Business Day would fall in the next calendar month, in which case
such Interest Period shall end on the next preceding Business Day, (b) any
Interest Period that begins on the last Business Day of a calendar month (or on
a day for which there is no numerically corresponding day in the calendar month
at the end of such Interest Period) shall end on the last Business Day of the
calendar month at the end of such Interest Period and (c) no Interest Period for
any Term Loan shall extend beyond the maturity date of such Term Loan. Interest
shall accrue from and including the first day of an Interest Period to but
excluding the last day of such Interest Period. For purposes hereof, the date of
a Borrowing initially shall be the date on which such Borrowing is made and
thereafter shall be the effective date of the most recent conversion or
continuation of such Borrowing.

“Interest Rate/Currency Hedging Agreement” shall mean any agreement of the type
described in clauses (a), (b) or (c) of the definition of “Interest
Rate/Currency Hedging Obligations”.

“Interest Rate/Currency Hedging Obligations” shall mean, with respect to any
specified Person, the obligations of such Person under (a) interest rate swap
agreements (whether from fixed to floating or from floating to fixed), interest
rate cap agreements and interest rate collar agreements, (b) other agreements or
arrangements designed to manage interest rates or interest rate risk and
(c) other agreements or arrangements designed to protect such Person against
fluctuations in currency exchange rates, in each case under clauses (a), (b) and
(c), entered into by such Person in the ordinary course of business and not for
speculative purposes.

“Intermediate Holdings” shall have the meaning assigned to such term in the
introductory statement to this Agreement.

“IP Rights” shall have the meaning assigned to such term in Section 3.25.

 

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“IRS” shall mean the United States Internal Revenue Service.

“Joint Lead Arrangers” shall have the meaning assigned to such term in the
introductory statement to this Agreement.

“Joint Syndication Agents” shall have the meaning assigned to such term in the
introductory statement to this Agreement.

“Lender Parties” shall have the meaning assigned to such term in Section 9.06.

“Lenders” shall mean (a) the Persons listed on Schedule 2.01 and (b) any other
Person that shall have become party hereto pursuant to an Assignment and
Assumption, other than any such Person that ceases to be a party hereto pursuant
to an Assignment and Assumption.

“LIBO Rate” shall mean, with respect to any Eurodollar Borrowing for any
Interest Period, the rate per annum determined by the Administrative Agent at
approximately 11:00 a.m. (London time) on the date that is two Business Days
prior to the commencement of such Interest Period by reference to the British
Bankers’ Association Interest Settlement Rates for deposits in Dollars (as set
forth by any service selected by the Administrative Agent that has been
nominated by the British Bankers’ Association as an authorized information
vendor for the purpose of displaying such rates) for a period equal to such
Interest Period; provided that to the extent that an interest rate is not
ascertainable pursuant to the foregoing provisions of this definition, the “LIBO
Rate” shall be the interest rate per annum determined by the Administrative
Agent to be the average of the rates per annum at which deposits in Dollars are
offered for such relevant Interest Period to major banks in the London interbank
market in London, England by the Administrative Agent at approximately
11:00 a.m. (London time) on the date that is two Business Days prior to the
beginning of such Interest Period.

“Lien” shall mean, with respect to any asset, (a) any mortgage, deed of trust,
lien, pledge, encumbrance, charge or security interest in or on such asset and
(b) the interest of a vendor or a lessor under any conditional sale agreement,
capital lease or title retention agreement (or any financing lease having
substantially the same economic effect as any of the foregoing) relating to such
asset.

“Limited Liability Company Operating Agreement” shall mean (a) with respect to
the Borrower, the limited liability company operating agreement, dated August 5,
2011 of Dynegy Midwest Generation, LLC, (b) with respect to Intermediate
Holdings, the limited liability company operating agreement, dated August 5,
2011 of Dynegy Coal Investments Holdings, LLC and (c) with respect to Holdings,
the limited liability company operating agreement, dated August 5, 2011 of
Dynegy Coal Holdco, LLC.

“Loan Documents” shall mean this Agreement, the Security Documents, the
Intercreditor Agreement, the promissory notes, if any, executed and delivered
pursuant to Section 2.04(e) and any other document executed in connection with
the foregoing.

 

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“Loan Parties” shall mean Intermediate Holdings, the Borrower and the Subsidiary
Guarantors.

“Margin Stock” shall have the meaning assigned to such term in Regulation U.

“Material Adverse Effect” shall mean (a) a materially adverse effect on the
business, assets, liabilities, operations, condition (financial or otherwise) or
operating results of the Borrower and the Subsidiaries, taken as a whole, (b) a
materially adverse effect on the Collateral, taken as a whole, (c) a material
impairment of the ability of the Borrower or the Loan Parties to perform any of
their material obligations under any Loan Document or (d) a material impairment
of the rights and remedies of or benefits available to the Lenders under any
Loan Document.

“Material Indebtedness” shall mean Indebtedness (other than the Term Loans), or
obligations in respect of Hedging Obligations, of any one or more of
Intermediate Holdings, the Borrower or any Subsidiary in an aggregate principal
amount exceeding $50,000,000. For purposes of determining Material Indebtedness,
the “principal amount” of the obligations of Intermediate Holdings, the Borrower
or any Subsidiary in respect of any of Hedging Obligations at any time shall be
the Agreement Value of such Hedging Obligations at such time.

“Material Project Documents” shall mean (a) any Cash Management Agreement,
Energy Management Agreement and Services Agreement, in each case including any
subsequent amendments, and (b) any Replacement Project Document entered into in
replacement thereof in accordance with the terms hereof.

“Material Subsidiary” shall mean, at any date of determination, any Domestic
Subsidiary of the Borrower acquired or organized after the Closing Date
(a) whose gross revenues as of the most recent available and delivered quarterly
or year-end financial statements of such Subsidiary and its subsidiaries were
equal to or greater than 3% of the consolidated gross revenues of the Borrower
and its Subsidiaries for the four-quarter period immediately prior to such date
or (b) whose total assets as of the most recent available quarterly or year-end
financial statements were equal to or greater than 3% of the total assets of the
Borrower and its Subsidiaries at such date, in each case determined in
accordance with GAAP.

“Maximum Rate” shall have the meaning assigned to such term in Section 9.09.

“Minimum Extension Condition” shall have the meaning assigned to such term in
Section 2.22(d).

“Minority Investment” shall have the meaning assigned to such term in
Section 6.04(h).

“Moody’s” shall mean Moody’s Investors Service, Inc., or any successor thereto.

“Mortgaged Properties” shall mean, the real properties owned in fee by the Loan
Parties specified on Schedule 1.01(b), and shall include each other parcel of
real property

 

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and improvements thereto (inclusive of any Project thereon) with respect to
which a Mortgage is granted pursuant to Section 5.12, in each case with a value
(determined in good faith by the Borrower) in excess of $25,000,000; provided
that notwithstanding the foregoing, each of the Loan Parties’ Projects owned in
fee by the Loan Parties, whether or not in operation as of the Closing Date,
shall be “Mortgaged Properties”.

“Mortgages” shall mean the mortgages, deeds of trust, deeds to secure debt,
assignments of leases and rents, to the extent required by applicable law,
modifications and other similar security documents, each delivered pursuant to
paragraph (g)(i) of Article IV or pursuant to Section 5.12 and substantially in
the form of Exhibit E.

“Multiemployer Plan” shall mean a multiemployer plan as defined in
Section 4001(a)(3) of ERISA subject to the provisions of Title IV of ERISA,
contributed to or required to be contributed to by the Borrower or any ERISA
Affiliate.

“Net Cash Proceeds” shall mean (a) with respect to any Asset Sale, the cash
proceeds (including cash proceeds subsequently received (as and when received)
in respect of noncash consideration initially received), net of (i) selling
expenses (including broker’s fees or commissions, legal fees, transfer and
similar taxes and the Borrower’s good faith estimate of income taxes paid or
payable in connection with such sale), (ii) amounts provided as a reserve, in
accordance with GAAP, against any liabilities indemnification obligations or
purchase price adjustment associated with such Asset Sale (provided that to the
extent and at the time any such amounts are released from such reserve, such
amounts shall constitute Net Cash Proceeds) and (iii) the principal amount,
premium or penalty, if any, interest and other amounts on any Indebtedness which
is secured by the asset sold in such Asset Sale and which is required to be
repaid with such proceeds (other than any such Indebtedness assumed by the
purchaser of such asset), (b) with respect to any issuance or incurrence of
Indebtedness or any Equity Issuance, the cash proceeds thereof, net of all taxes
and fees, discounts, commissions, costs and other expenses incurred in
connection therewith and (c) with respect to any Extraordinary Receipt, the cash
proceeds (net of (i) expenses (including legal fees, transfer and similar taxes
and the Borrower’s good faith estimate of income taxes paid or payable in
connection with such Extraordinary Receipt)) received by or paid to or for the
account of any Loan Party to the extent not used to restore or repair any
Project in respect of which such proceeds were received; provided, however,
that, in the case of the proceeds described in clause (a) and (c) of this
definition, if (x) the Borrower shall deliver a certificate of a Financial
Officer to the Administrative Agent at the time of receipt thereof (or promptly
thereafter) setting forth the Borrower’s intent to reinvest such proceeds in
productive assets of a kind then used or usable in the business of the Borrower
and its Subsidiaries within 12 months of receipt of such proceeds and (y) no
Event of Default shall have occurred and shall be continuing at the time of such
certificate or at the proposed time of the application of such proceeds, such
proceeds shall not constitute Net Cash Proceeds except to the extent not so
reinvested or contractually committed to be so reinvested by the end of such
12 month period, at which time such proceeds shall be deemed to be Net Cash
Proceeds; provided further that (x) if any portion of such proceeds are not so
used within such 12 month period but within such 12-month period are
contractually committed to be used, then upon the termination of such contract
(or if

 

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any such Net Cash Proceeds are not so used within 18 months of initial receipt),
such remaining portion shall constitute Net Cash Proceeds as of the earlier of
the date of such termination or expiry of such 18-month period and (y) such
proceeds shall constitute Net Cash Proceeds notwithstanding any reinvestment
notice if there is an Event of Default at the time of a proposed reinvestment
unless such proposed reinvestment is made pursuant to a binding commitment
entered into at a time when no Event of Default was continuing.

“Netting Agreement” shall mean a netting agreement, master netting agreement or
other similar document having the same effect as a netting agreement or master
netting agreement and, as applicable, any collateral annex, security agreement,
or other similar document related to any master netting agreement (in each case
in connection with contracts or transactions entered into in the ordinary course
of business).

“Non-Consenting Lender” shall mean any Lender that does not approve any consent,
waiver or amendment that (i) requires the approval of all affected Lenders in
accordance with the terms of Section 9.08(b) and (ii) has been approved by the
Required Lenders.

“Obligations” shall mean all obligations defined as “Obligations” in the
Guarantee and Collateral Agreement and the other Security Documents.

“OFAC” shall have the meaning assigned to such term in Section 3.24.

“Offer Loans” shall have the meaning assigned to such term in Section 2.12(e).

“Other Taxes” shall mean any and all present or future stamp or documentary
Taxes or any other excise or property Taxes, charges or similar levies arising
from any payment made under any Loan Document or from the execution, delivery or
enforcement of, or otherwise with respect to, any Loan Document (except any such
Taxes imposed with respect to an assignment of Loans (other than an assignment
of Loans made (i) in connection with the primary syndication or (ii) at the
Borrower’s request)).

“Parent” shall mean Dynegy Inc., a Delaware corporation and the ultimate parent
company of the Borrower and its Subsidiaries.

“Participant” has the meaning assigned to such term in Section 9.04(f).

“Participant Register” has the meaning assigned to such term in Section 9.04(f).

“PBGC” shall mean the Pension Benefit Guaranty Corporation referred to and
defined in ERISA or any successor statute.

“Perfection Certificate” shall mean (a) for the purposes of the definition of
“Reorganization” and paragraph (f) of Article IV, the agreed form of perfection
certificate signed by the Borrower and delivered to the Administrative Agent on
or prior to the date hereof and (b) for the purposes of Section 5.06(b), a
certificate substantially in the form of Exhibit B to the Guarantee and
Collateral Agreement.

 

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“Permit” shall mean any permit, authorization, registration, consent, approval,
waiver, exception, variance, order, judgment, written interpretation, decree,
license, exemption, publication, filing, notice to and declaration of or with,
or required by, any Governmental Authority, and shall include any environmental
or operating permit or license that is required for the full use, occupancy,
zoning and operation of an electric power generating facility.

“Permitted Contracts” shall have the meaning assigned to such term in
Section 6.02(r).

“Permitted Contracts Counterparty” shall have the meaning assigned to such term
in Section 6.02(s).

“Permitted Investments” shall mean:

(a) Dollars;

(b) (i) securities issued or directly and fully guaranteed or insured by the
United States government or any agency or instrumentality of the United States
government (provided that the full faith and credit of the United States is
pledged in support of those securities) and (ii) debt obligations issued by the
Government National Mortgage Association, Farm Credit System, Federal Home Loan
Banks, Federal Home Loan Mortgage Corporation, Financing Corporation and
Resolution Funding Corporation, in the case of each of clause (i) and
(ii) above, having maturities of not more than 270 days from the date of
acquisition;

(c) certificates of deposit, demand deposits, and time deposits with maturities
of not more than 270 days from the date of acquisition, bankers’ acceptances
with maturities of not more than 270 days from the date of acquisition and
overnight bank deposits, in each case, with any domestic branch of a commercial
bank having capital and surplus in excess of $500,000,000 and whose short-term
debt, or whose parent company’s short-term debt, has the highest rating
obtainable from Moody’s or S&P;

(d) repurchase obligations (including under tri-party repurchase agreements)
with a term of not more than 30 days from the date of acquisition for underlying
securities of the types described in clauses (b) and (c) above entered into with
any financial institution meeting the qualifications specified in clause
(c) above;

(e) commercial paper, notes and bonds having the highest ratings obtainable from
Moody’s or S&P and in each case maturing within 270 days from the date of
acquisition; and

(f) investments in “money market funds” that primarily invest in investments of
the type described in clauses (a) through (e) above.

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

 

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“Plan” shall mean any employee pension benefit plan (other than a Multiemployer
Plan) subject to the provisions of Title IV of ERISA or Sections 412 or 430 of
the Code or Section 302 of ERISA, and in respect of which the Borrower or any
ERISA Affiliate is (or, if such plan were terminated, would under Section 4069
of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.

“Platform” shall have the meaning assigned to such term in Section 9.01.

“Pledge Agreement” shall mean the Pledge Agreement, substantially in the form of
Exhibit J, between Intermediate Holdings and the Collateral Trustee for the
benefit of the Secured Parties.

“Prime Rate” shall mean the rate of interest per annum determined from time to
time by Credit Suisse as its prime rate in effect at its principal office in
New York City and notified to the Borrower; the prime rate is a rate set by
Credit Suisse based upon various factors including Credit Suisse’s costs and
desired return, general economic conditions and other factors, and is used as a
reference point for pricing some loans, which may be priced at, above, or below
such rate; provided that if Credit Suisse is replaced by a successor
administrative agent pursuant to Article VIII, “Prime Rate” shall be as
determined by such successor; provided, further that if such successor does not
calculate a prime rate, “Prime Rate” shall mean the rate of interest quoted in
the print edition of The Wall Street Journal, Money Rates Section as the “Prime
Rate” (currently defined as the base rate on corporate loans posted by at least
75% of the nation’s thirty (30) largest banks), as in effect from time to time;
such “Prime Rate” shall be a reference rate and shall not necessarily represent
the lowest or best rate actually charged to any customer.

“Project” shall mean any (a) electrical generation plant, (b) cogeneration
plant, (c) facility for the development, storage, transport or transmission of,
electricity, steam, fuel, syngas or other resources for the generation of
electricity or (d) facility engaged in another line of business in which the
Borrower and its Subsidiaries are permitted to be engaged hereunder, in each
case for which a Subsidiary or Subsidiaries of the Borrower was, is or will be
(as the case may be) an owner, lessee, operator, manager or developer and shall
also mean any two or more of such plants or facilities in which an interest has
been acquired in a single transaction; provided that a Project shall cease to be
a Project of the Borrower and its Subsidiaries at such time that the Borrower or
any of its Subsidiaries ceases to have any existing or future rights or
obligations (whether direct or indirect, contingent or matured) associated
therewith.

“Prudent Industry Practice” shall mean those practices or methods as are
commonly used or adopted by Persons in the independent power generation industry
in the United States, in connection with the conduct of such industry, in each
case as such practices or methods may evolve from time to time, consistent with
all applicable requirements of law.

“Public Disclosure” shall mean the Parent’s most recent annual report, Form 10-K
for the most recently completed fiscal year, each quarterly report on Form 10-Q
or any

 

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current reports on Form 8-K (or similar reports filed on successor forms) filed
since the initial filing date of such Form 10-K, in each case filed prior to
July 7, 2011.

“Public Lender” shall have the meaning assigned to such term in Section 9.01.

“PUHCA” shall mean the Public Utility Holding Company Act of 2005.

“PURPA” shall mean Public Utility Regulatory Policies Act of 1978.

“Qualified Capital Stock” of any Person shall mean any Equity Interest of such
Person that is not Disqualified Stock.

“Qualified Debt Investor” shall mean any commercial bank, insurance company,
investment or mutual fund or other fund or entity that is an “accredited
investor” (as defined in Regulation D under the Securities Act of 1933 (as
amended from time to time and any successor statute)) and which is a bona fide
diversified investment fund that extends credit, buys or invests in loans,
securities or other financial assets in the ordinary course of its business;
provided that:

(a) the Qualified Debt Investor or any of its Affiliates (other than Parent or
its subsidiaries) does not possess, directly or indirectly, the power to direct
or cause the direction of the management or policies of the Parent or its
subsidiaries as a result of (i) its or any of its Affiliates (other than the
Parent or its subsidiaries) membership on the board of directors (or similar
governing body) of Parent or its subsidiaries or (ii) its or any of its
Affiliates (other than Parent or its subsidiaries) ownership of 10% or more of
the voting equity in Parent or any of its subsidiaries; and

(b) neither the Parent or its subsidiaries possesses, directly or indirectly,
the power to direct or cause the direction of the investment policies of the
Qualified Debt Investor or any of its Affiliates (other than Parent or its
subsidiaries).

“Register” shall have the meaning assigned to such term in Section 9.04(d).

“Regulation T” shall mean Regulation T of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.

“Regulation U” shall mean Regulation U of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.

“Regulation X” shall mean Regulation X of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.

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

“Related Parties” shall mean, with respect to any Person, such Person’s
Affiliates, such Person’s successors and assigns and the partners, directors,
officers,

 

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employees, agents, members, Controlling Persons, trustees, administrators,
managers and representatives of such Person and of such Person’s Affiliates.

“Release” shall mean any release, spill, emission, leaking, dumping, injection,
pouring, deposit, disposal, discharge, dispersal, leaching or migration into or
through the environment or within or upon any building, structure, facility or
fixture.

“Remedial Action” shall mean all actions required by applicable Environmental
Law to (a) clean up, remove, treat or in any other way remediate any Release of
Hazardous Materials; (b) prevent the Release of Hazardous Materials so that they
do not migrate or endanger or threaten to endanger public health or welfare or
the environment; or (c) perform studies, investigations and monitoring related
to any such Release of Hazardous Materials.

“Removal Effective Date” shall have the meaning assigned to such term in
Article VIII.

“Reorganization” shall mean the series of transactions to be consummated by
Parent and its subsidiaries on or prior to the Closing Date and prior to the
consummation of the transactions contemplated under this Agreement, in order to,
directly or indirectly, pursue a reorganization of Parent and its subsidiaries,
following which transactions, the corporate organization of Parent and its
subsidiaries shall be as set forth in the organization chart attached to the
Perfection Certificate.

“Reorganization Documents” shall mean such organization and other corporate
documents required to affect the Reorganization, including the certificate of
formation of the limited liability companies formed in connection with the
Reorganization, the certificates of conversion filed in order to effect the
conversions contemplated in connection with the Reorganization, the limited
liability company operating agreements of the Borrower and the other limited
liability companies formed in connection with the Reorganization, the board,
manager, shareholder, member, and similar resolutions adopted in connection with
the Reorganization, the articles of merger and the certificate of merger filed
to effect the merger of Dynegy Midwest Generation, Inc. with Dynegy Midwest
Generation, LLC in which the Borrower is the surviving entity, the agreement and
plan of merger entered into in connection with such merger, the contribution
agreements entered into in order to effect the contributions contemplated in
connection with the Reorganization, the stock or other transfer powers executed
and delivered in connection with the Reorganization and any material
intellectual property licensing agreement.

“Replacement Project Document” shall mean any contract entered into in
replacement of an existing Material Project Document.

“Required Lenders” shall mean, at any time, Lenders having Term Loans
representing more than 50% of the sum of all Term Loans outstanding at such
time; provided that the Term Loans of any Defaulting Lender shall be disregarded
in the determination of the Required Lenders at any time.

 

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“Resignation Effective Date” shall have the meaning assigned to such term in
Article VIII.

“Responsible Officer” of any Person shall mean any executive officer or
Financial Officer of such Person and any other officer or similar official
thereof responsible for the administration of the obligations of such Person in
respect of this Agreement.

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

“S&P” shall mean Standard & Poor’s Ratings Service, or any successor thereto.

“Secured Parties” shall have the meaning assigned to such term in the
Intercreditor Agreement.

“Security Documents” shall mean the Intercreditor Agreement, the Control
Agreements, the Mortgages, the Pledge Agreement, the Guarantee and Collateral
Agreement and each of the security agreements, mortgages and other instruments
and documents executed and delivered pursuant to any of the foregoing or
pursuant to Section 5.12.

“Services Agreement” shall mean any of the Services Agreements dated as of
August 5, 2011 among the Parent and Intermediate Holdings or its subsidiaries.

“Specified Hedging Agreement” shall mean any Interest Rate/Currency Hedging
Agreement entered into with an Acceptable Financial Counterparty.

“SPV” shall have the meaning assigned to such term in Section 9.04(i).

“Statutory Reserves” shall mean a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
one minus the aggregate of the maximum reserve percentages (including any
marginal, special, emergency or supplemental reserves) expressed as a decimal
established by the Board. Eurodollar Term Loans shall be deemed to constitute
Eurocurrency Liabilities (as defined in Regulation D of the Board) and to be
subject to such reserve requirements without benefit of or credit for proration,
exemptions or offsets that may be available from time to time to any Lender
under such Regulation D. Statutory Reserves shall be adjusted automatically on
and as of the effective date of any change in any reserve percentage.

“subsidiary” shall mean, with respect to any Person (herein referred to as the
“parent”), any corporation, partnership, limited liability company, association
or other business entity (a) of which securities or other ownership interests
representing more than

 

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50% of the equity or more than 50% of the ordinary voting power or more than 50%
of the general partnership interests are, at the time any determination is being
made, owned or held (directly or indirectly through one or more subsidiaries) or
(b) which is a partnership with respect to which such parent is the sole general
partner of and Controls such partnership.

“Subsidiary” shall mean any direct or indirect subsidiary of the Borrower.

“Subsidiary Guarantor” shall mean each Subsidiary listed on Schedule 1.01(a),
and each other Subsidiary that is or becomes a party to the Guarantee and
Collateral Agreement.

“Supermajority Lenders” shall mean, at any time, Lenders having Term Loans
representing more than 66 2/3% of the sum of all Term Loans outstanding at such
time; provided that the Term Loans of any Defaulting Lender shall be disregarded
in the determination of the Supermajority Lenders at any time.

“Synthetic Lease” shall mean, as to any Person, any lease (including leases that
may be terminated by the lessee at any time) of any property (whether real,
personal or mixed) (a) that is accounted for as an operating lease under GAAP,
for the purposes of this definition as in effect and consistently applied by the
Borrower on the Closing Date, and (b) in respect of which the lessee retains or
obtains ownership of the property so leased for U.S. federal income tax
purposes, other than any such lease under which such Person is the lessor.

“Synthetic Lease Obligations” shall mean, as to any Person, an amount equal to
the capitalized amount of the remaining lease payments under any Synthetic Lease
that would appear on a balance sheet of such person in accordance with GAAP if
such obligations were accounted for as Capital Lease Obligations.

“Synthetic Purchase Agreement” shall mean any swap, derivative or other
agreement or combination of agreements pursuant to which the Borrower or any
Subsidiary is or may become obligated to make (a) any payment in connection with
a purchase by any third party from a Person other than the Borrower or any
Subsidiary of any Equity Interest or (b) any payment (other than on account of a
permitted purchase by it of any Equity Interest) the amount of which is
determined by reference to the price or value at any time of any Equity
Interest; provided that no phantom stock or similar plan providing for payments
only to current or former directors, officers or employees of the Borrower or
the Subsidiaries (or to their heirs or estates) shall be deemed to be a
Synthetic Purchase Agreement.

“Tax Sharing Agreement” shall mean that certain Tax Sharing Agreement dated as
of August 4, 2011 among Parent, Dynegy Gas Holdco, LLC, a Delaware limited
liability company, Dynegy Gas Investments Holdings, LLC, a Delaware limited
liability company, GasCo, Holdings, Intermediate Holdings, and the Borrower, as
in effect as of the date hereof without giving effect to any amendment that is
adverse to the Lenders in any material respects.

 

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“Taxes” shall mean any and all present or future taxes, levies, imposts, duties,
deductions, withholdings, assessments, fees or other charges imposed by any
Governmental Authority, including any interest, additions to tax or penalties
applicable thereto.

“Term Borrowing” shall mean a Borrowing comprised of Term Loans.

“Term Loan Commitment” shall mean, with respect to each Lender, the commitment
of such Lender to make Term Loans hereunder as set forth on Schedule 2.01, or in
the Assignment and Assumption pursuant to which such Lender assumed its Term
Loan Commitment, as applicable, as the same may be (a) reduced from time to time
pursuant to Section 2.09 and (b) reduced or increased from time to time pursuant
to assignments by or to such Lender pursuant to Section 9.04. The aggregate
amount of the Term Loan Commitment is $600,000,000 as of the Closing Date.

“Term Loan Maturity Date” shall mean the fifth annual anniversary of the date
hereof.

“Term Loan Repayment Date” shall have the meaning given such term in
Section 2.11(a).

“Term Loans” shall mean the term loans made by the Lenders to the Borrower
pursuant to Section 2.01.

“Trade Date” shall have the meaning assigned to such term in Section 9.04(b)(i).

“Transactions” shall mean, collectively, (a) the execution, delivery and
performance by certain direct or indirect subsidiaries of the Parent of the
Reorganization Documents and the consummation of the transactions contemplated
thereby, (b) the execution, delivery and performance by the Loan Parties of the
Loan Documents to which they are a party and the making of the Borrowings
hereunder, (c) the repayment of all amounts due or outstanding under or in
respect of, and the termination of, the Existing Credit Facility and (d) the
payment of related fees and expenses.

“Treasury Rate” shall mean, as of any date of voluntary or mandatory prepayment
of the Term Loans, the yield to maturity as of such date of the United States
Treasury securities with a constant maturity (as compiled and published in the
most recent Federal Reserve Statistical Release H.15 (519) that has become
publicly available at least two business days prior to such date (or, if such
Statistical Release is no longer published, any publicly available source of
similar market data)) most nearly equal to the period from such date to the
second anniversary of the Closing Date; provided, however, that if the period
from such date to the second anniversary of the Closing Date is less than one
year, the weekly average yield on actually traded United States Treasury
securities adjusted to a constant maturity of one year will be used.

 

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“Treasury Services Agreement” shall mean any agreement between the Borrower or
any Subsidiary and any Acceptable Financial Counterparty relating to treasury,
depository, credit card, debit card, stored value cards, purchasing or
procurement cards and cash management services or automated clearinghouse
transfer of funds or any similar services.

“Type”, when used in respect of any Term Loan or Borrowing, shall refer to the
Rate by reference to which interest on such Term Loan or on the Term Loans
comprising such Borrowing is determined. For purposes hereof, the term “Rate”
shall mean the Adjusted LIBO Rate and the Alternate Base Rate.

“USA PATRIOT Act” shall mean The Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001
(Title III of Pub. L. No. 107-56 (signed into law October 26, 2001)).

“Vermillion Facility” shall mean the decommissioned power generation facility
owned by the Borrower and located in Vermillion County, Illinois.

“Weighted Average Yield” shall mean with respect to any Term Loan, on any date
of determination, the weighted average yield to maturity, in each case, based on
the interest rate applicable to such Term Loan on such date and giving effect to
all upfront or similar fees or original issue discount payable with respect to
such Term Loan (excluding any upfront, arrangement or structuring fee that is
not owed generally to any Lenders making such Term Loan) and taking into account
any interest rate floor.

“Wholly Owned Subsidiary” of any Person shall mean a subsidiary of such Person
of which securities (except for directors’ qualifying shares) or other ownership
interests representing 100% of the Equity Interests are, at the time any
determination is being made, owned or held by such Person or one or more wholly
owned subsidiaries of such Person or by such Person and one or more wholly owned
subsidiaries of such Person.

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

“Wood River 1-3 Units” shall mean the decommissioned units 1 through 3 located
at the power generation facility owned by the Borrower and located in Madison
County, Illinois.

“Yield Maintenance Amount” shall have the meaning assigned to such term in
Section 2.12(d).

SECTION 1.02. Terms Generally. The definitions of terms herein shall apply
equally to the singular and plural forms of the terms defined. Whenever the
context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words “include,” “includes” and “including” shall
be deemed to be followed

 

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by the phrase “without limitation.” The word “will” shall be construed to have
the same meaning and effect as the word “shall.” Unless the context requires
otherwise (a) any definition of or reference to any agreement, instrument or
other document herein shall be construed as referring to such agreement,
instrument or other document as from time to time amended, supplemented or
otherwise modified (subject to any restrictions on such amendments, supplements
or modifications set forth herein), (b) any reference herein to any Person shall
be construed to include such Person’s successors and assigns, (c) the words
“herein,” “hereof” and “hereunder,” and words of similar import, shall be
construed to refer to this Agreement in its entirety and not to any particular
provision hereof, (d) all references herein to Articles, Sections, Exhibits and
Schedules shall be construed to refer to Articles and Sections of, and Exhibits
and Schedules to, this Agreement, (e) any reference to any law or regulation
herein shall, unless otherwise specified, refer to such law or regulation as
amended, modified or supplemented from time to time, (f) the words “asset” and
“property” shall be construed to have the same meaning and effect and to refer
to any and all tangible and intangible assets and properties, including cash,
securities, accounts and contract rights and (g) all terms of an accounting
nature or financial nature shall construed in accordance with GAAP.

Notwithstanding anything to the contrary contained herein, if at any time any
change in GAAP would affect any computation or defined term set forth in any
Loan Document, and the Borrower shall at such time or thereafter so request, the
Administrative Agent and the Borrower shall negotiate in good faith to amend the
relevant provisions of the Loan Documents to preserve the original intent
thereof in light of such change in GAAP (subject to the approval of Required
Lenders), provided that, until so amended, such computation or defined term
shall continue to be computed in conformity with GAAP but without giving effect
to such identified changes to GAAP.

SECTION 1.03. Classification of Term Loans and Borrowings. For purposes of this
Agreement, Term Loans may be classified and referred to by Class (e.g., a “Term
Loan”) or by Type (e.g., a “Eurodollar Borrowing”). Borrowings also may be
classified and referred to by Class and Type (e.g., a “Eurodollar Term Loan”).

ARTICLE II

The Credits

SECTION 2.01. Term Loans. Subject to the terms and conditions and relying upon
the representations and warranties herein set forth, each Lender agrees,
severally and not jointly, to make a Term Loan to the Borrower on the Closing
Date in a principal amount not to exceed its Term Loan Commitment. Amounts paid
or prepaid in respect of Term Loans may not be reborrowed.

SECTION 2.02. Term Loans. (a) Each Term Loan shall be made as part of a
Borrowing consisting of Term Loans made by the Lenders ratably in accordance
with their Term Loan Commitments; provided, however, that the failure of any
Lender to make any Term Loan shall not in itself relieve any other Lender of its
obligation to lend hereunder (it being understood, however, that no Lender shall
be responsible for the

 

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failure of any other Lender to make any Term Loan required to be made by such
other Lender).

(b) Subject to Sections 2.08 and 2.15, each Borrowing shall be comprised
entirely of ABR Term Loans or Eurodollar Term Loans as the Borrower may request
pursuant to Section 2.03. Each Lender may at its option make any Eurodollar Term
Loan by causing any domestic or foreign branch or Affiliate of such Lender to
make such Term Loan; provided that any exercise of such option shall not affect
the obligation of the Borrower to repay such Term Loan in accordance with the
terms of this Agreement. Borrowings of more than one Type may be outstanding at
the same time; provided, however, that the Term Loans comprising any Borrowing
shall be in an aggregate principal amount that is (i) an integral multiple of
$500,000 and (ii) not less than $5,000,000; provided, further, that the Borrower
shall not be entitled to request any Borrowing that, if made, would result
in more than ten Eurodollar Borrowings outstanding hereunder at any time. For
purposes of the foregoing, Borrowings having different Interest Periods,
regardless of whether they commence on the same date, shall be considered
separate Borrowings.

(c) Each Lender shall make each Term Loan to be made by it hereunder on the
proposed date thereof by wire transfer of immediately available funds to such
account in New York City as the Administrative Agent may designate not later
than 1:00 p.m., New York City time, and the Administrative Agent shall promptly
credit the amounts so received to an account designated by the Borrower in the
applicable Borrowing Request or, if a Borrowing shall not occur on such date
because any condition precedent herein specified shall not have been met, return
the amounts so received to the respective Lenders.

(d) Unless the Administrative Agent shall have received notice from a Lender,
prior to the proposed date of any Borrowing that such Lender will not make
available to the Administrative Agent such Lender’s share of such Borrowing, the
Administrative Agent may assume that such Lender has made such share available
on such date in accordance with Section 2.03 and may, in reliance upon such
assumption, make available to the Borrower a corresponding amount. In such
event, if a Lender has not in fact made its share of the applicable Borrowing
available to the Administrative Agent, then the applicable Lender and the
Borrower severally agree to pay to the Administrative Agent forthwith on demand
such corresponding amount with interest thereon, for each day from and including
the date such amount is made available to the Borrower to but excluding the date
of payment to the Administrative Agent, at (i) in the case of a payment to be
made by such Lender, the greater of the Federal Funds Effective Rate and a rate
determined by the Administrative Agent in accordance with banking industry rules
on interbank compensation, and (ii) in the case of a payment to be made by the
Borrower, the interest rate applicable to ABR Term Loans. If the Borrower and
such Lender shall pay such interest to the Administrative Agent for the same or
an overlapping period, the Administrative Agent shall promptly remit to the
Borrower the amount of such interest paid by the Borrower for such period. If
such Lender

 

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pays its share of the applicable Borrowing to the Administrative Agent, then the
amount so paid shall constitute such Lender’s Term Loan included in such
Borrowing. Any payment by the Borrower shall be without prejudice to any claim
the Borrower may have against a Lender that shall have failed to make such
payment to the Administrative Agent.

SECTION 2.03. Borrowing Procedure. In order to request a Borrowing, the Borrower
shall notify the Administrative Agent of such request by telephone (a) in the
case of a Eurodollar Borrowing, not later than 1:00 p.m., New York City time,
three Business Days before a proposed Borrowing, and (b) in the case of an ABR
Borrowing, not later than 1:00 p.m., New York City time, one Business Day before
a proposed Borrowing or such other prior notice reasonably acceptable to the
Administrative Agent. Each such telephonic Borrowing Request shall be
irrevocable, and shall be confirmed promptly by hand delivery or fax to the
Administrative Agent of a written Borrowing Request and shall specify the
following information: (i) whether the Borrowing then being requested is to be a
Eurodollar Borrowing or an ABR Borrowing; (ii) the date of such Borrowing (which
shall be a Business Day); (iii) the number and location of the account to which
funds are to be disbursed; (iv) the amount of such Borrowing; and (v) if such
Borrowing is to be a Eurodollar Borrowing, the Interest Period with respect
thereto; provided, however, that, notwithstanding any contrary specification in
any Borrowing Request, each requested Borrowing shall comply with the
requirements set forth in Section 2.02. If no election as to the Type of
Borrowing is specified in any such notice, then the requested Borrowing shall be
an ABR Borrowing. If no Interest Period with respect to any Eurodollar Borrowing
is specified in any such notice, then the Borrower shall be deemed to have
selected an Interest Period of one month’s duration. The Administrative Agent
shall promptly advise the applicable Lenders of any notice given pursuant to
this Section 2.03 (and the contents thereof), and of each Lender’s portion of
the requested Borrowing.

SECTION 2.04. Evidence of Debt; Repayment of Term Loans. (a) The Borrower hereby
unconditionally promises to pay to the Administrative Agent for the account of
each Lender the principal amount of each Term Loan of such Lender as provided in
Section 2.11.

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

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

 

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(d) The entries made in the accounts maintained pursuant to paragraphs (b)
and (c) above shall be prima facie evidence of the existence and amounts of the
obligations therein recorded; provided, however, that the failure of any Lender
or the Administrative Agent to maintain such accounts or any error therein shall
not in any manner affect the obligations of the Borrower to repay the Term Loans
in accordance with their terms; provided, further, in the event of a conflict
between the accounts maintained pursuant to paragraphs (b) and (c) above, the
accounts maintained pursuant to paragraph (c) above shall govern.

(e) Any Lender may request that Term Loans made by it hereunder be evidenced by
a promissory note. In such event, the Borrower shall execute and deliver to such
Lender a promissory note payable to such Lender and its registered assigns and
in a form and substance reasonably acceptable to the Administrative Agent and
the Borrower. Notwithstanding any other provision of this Agreement, in the
event any Lender shall request and receive such a promissory note, the interests
represented by such note shall at all times (including after any assignment of
all or part of such interests pursuant to Section 9.04) be represented by one or
more promissory notes payable to the payee named therein or its registered
assigns.

SECTION 2.05. Fees. (a) The Borrower agrees to pay to the Administrative Agent,
for its own account, the administrative fees set forth in the Engagement Letter
(the “Administrative Agent Fees”).

(b) All Administrative Agent Fees shall be paid on the dates due, in immediately
available funds, to the Administrative Agent. Once paid, none of the
Administrative Agent Fees shall be refundable under any circumstances.

(c) In addition, the Borrower agrees to pay on the Closing Date to each Lender
that is party to this Agreement as a Lender on the Closing Date, as fee
compensation for the funding of such Lender’s Term Loan, a closing fee in an
amount equal to 2.00% of the stated principal amount of such Lender’s Term Loan,
payable to such Lender from the proceeds of its Term Loan as and when funded on
the Closing Date (including any payment of such fees in the form the making of
such Term Loans net of any such fees by such Lender). Such closing fee will be
in all respects fully earned, due and payable on the Closing Date and shall not
be refundable under any circumstances.

SECTION 2.06. Interest on Term Loans. (a) Subject to the provisions of
Section 2.07, the Term Loans comprising each ABR Borrowing shall bear interest
(computed on the basis of the actual number of days elapsed over a year of 365
or 366 days, as the case may be, when the Alternate Base Rate is determined by
reference to the Prime Rate and over a year of 360 days at all other times and
calculated from and including the date of such Borrowing to but excluding the
date of repayment thereof) at a rate per annum equal to the Alternate Base Rate
plus the Applicable Margin.

(b) Subject to the provisions of Section 2.06(d) and Section 2.07, the Term
Loans comprising each Eurodollar Borrowing shall bear interest (computed on the

 

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basis of the actual number of days elapsed over a year of 360 days) at a rate
per annum equal to the Adjusted LIBO Rate for the Interest Period in effect for
such Borrowing plus the Applicable Margin.

(c) Interest on each Term Loan shall be payable on the Interest Payment Dates
applicable to such Term Loan except as otherwise provided in this Agreement. The
applicable Alternate Base Rate or Adjusted LIBO Rate for each Interest Period or
day within an Interest Period, as the case may be, shall be determined by the
Administrative Agent, and such determination shall be conclusive absent manifest
error.

(d) If any Financial Statement Delivery Failure has occurred and is continuing,
then, for so long as such Financial Statement Delivery Failure is continuing,
the Applicable Margin applicable to any Term Loan shall be increased by an
amount equal to the Financial Statement Margin Increase.

SECTION 2.07. Default Interest. All past due amounts owing under this Agreement
and the other Loan Documents shall bear interest (after as well as before
judgment) for all past-due periods, payable on demand, (a) in the case of
principal, at the rate otherwise applicable to such Term Loan pursuant to
Section 2.06 plus 2.00% per annum and (b) in all other cases, at a rate per
annum (computed on the basis of the actual number of days elapsed over a year of
365 or 366 days, as the case may be, when determined by reference to the Prime
Rate and over a year of 360 days at all other times) equal to the rate that
would be applicable to an ABR Term Loan plus 2.00% per annum.

SECTION 2.08. Alternate Rate of Interest. In the event, and on each occasion,
that on the day two Business Days prior to the commencement of any Interest
Period for a Eurodollar Borrowing the Administrative Agent shall have determined
that Dollar deposits in the principal amounts of the Term Loans comprising such
Borrowing are not generally available in the London interbank market, or that
the rates at which such Dollar deposits are being offered will not adequately
and fairly reflect the cost to the majority of Lenders of making or maintaining
Eurodollar Term Loans during such Interest Period, or that reasonable means do
not exist for ascertaining the Adjusted LIBO Rate, the Administrative Agent
shall, as soon as practicable thereafter, give written or fax notice of such
determination to the Borrower and the Lenders. In the event of any such
determination, until the Administrative Agent shall have advised the Borrower
and the Lenders that the circumstances giving rise to such notice no longer
exist, any request by the Borrower for a Eurodollar Borrowing pursuant to
Section 2.03 or 2.10 shall be deemed to be a request for an ABR Borrowing. Each
determination by the Administrative Agent under this Section 2.08 shall be
conclusive absent manifest error.

SECTION 2.09. Termination of Term Loan Commitments. The Term Loan Commitments
shall automatically terminate upon the making of the Term Loans on the Closing
Date. Notwithstanding the foregoing, all the Term Loan Commitments shall
automatically terminate at 5:00 p.m., New York City time, on August 5, 2011, if
the initial Borrowing shall not have occurred by such time.

 

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SECTION 2.10. Conversion and Continuation of Borrowings. The Borrower shall have
the right at any time upon prior irrevocable written notice to the
Administrative Agent (a) not later than 1:00 p.m., New York City time, one
Business Day prior to conversion, to convert any Eurodollar Borrowing into an
ABR Borrowing, (b) not later than 1:00 p.m., New York City time, three Business
Days prior to conversion or continuation, to convert any ABR Borrowing into a
Eurodollar Borrowing or to continue any Eurodollar Borrowing as a Eurodollar
Borrowing for an additional Interest Period, and (c) not later than 1:00 p.m.,
New York City time, three Business Days prior to conversion, to convert the
Interest Period with respect to any Eurodollar Borrowing to another permissible
Interest Period, subject in each case to the following:

(i) Reserved;

(ii) each conversion or continuation shall be made pro rata among the Lenders in
accordance with the respective principal amounts of the Term Loans comprising
the converted or continued Borrowing;

(iii) if less than all the outstanding principal amount of any Borrowing shall
be converted or continued, then each resulting Borrowing shall satisfy the
limitations specified in Sections 2.02(a) and 2.02(b) regarding the principal
amount and maximum number of Borrowings of the relevant Type;

(iv) each conversion shall be effected by each Lender and the Administrative
Agent by recording for the account of such Lender the new Term Loan of such
Lender resulting from such conversion and reducing the Term Loan (or portion
thereof) of such Lender being converted by an equivalent principal amount;
accrued interest on any Eurodollar Term Loan (or portion thereof) being
converted shall be paid by the Borrower at the time of conversion;

(v) if any Eurodollar Borrowing is converted at a time other than the end of the
Interest Period applicable thereto, the Borrower shall pay, upon demand, any
amounts due to the Lenders pursuant to Section 2.16;

(vi) any portion of a Borrowing maturing or required to be repaid in less than
one month may not be converted into or continued as a Eurodollar Borrowing;

(vii) any portion of a Eurodollar Borrowing that cannot be converted into or
continued as a Eurodollar Borrowing by reason of the immediately preceding
clause shall be automatically converted at the end of the Interest Period in
effect for such Borrowing into an ABR Borrowing;

(viii) no Interest Period may be selected for any Eurodollar Term Borrowing that
would end later than a Term Loan Repayment Date occurring on or after the first
day of such Interest Period if, after giving effect to such selection, the
aggregate outstanding amount of (A) the Eurodollar Term Borrowings comprised of
Term Loans with Interest Periods ending on or prior to such Term Loan Repayment
Date and (B) the ABR Term Borrowings comprised of Term

 

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Loans would not be at least equal to the principal amount of Term Borrowings to
be paid on such Term Loan Repayment Date; and

(ix) upon notice to the Borrower from the Administrative Agent given at the
request of the Required Lenders, after the occurrence and during the continuance
of an Event of Default, no outstanding Term Loan may be converted into, or
continued as, a Eurodollar Term Loan.

Each notice pursuant to this Section 2.10 shall be in writing and irrevocable
and shall refer to this Agreement and specify (i) the identity and amount of the
Borrowing that the Borrower requests be converted or continued, (ii) whether
such Borrowing is to be converted to or continued as a Eurodollar Borrowing or
an ABR Borrowing, (iii) if such notice requests a conversion, the date of such
conversion (which shall be a Business Day) and (iv) if such Borrowing is to be
converted to or continued as a Eurodollar Borrowing, the Interest Period with
respect thereto. If no Interest Period is specified in any such notice with
respect to any conversion to or continuation as a Eurodollar Borrowing, the
Borrower shall be deemed to have selected an Interest Period of one month’s
duration. The Administrative Agent shall promptly advise the Lenders of any
notice given pursuant to this Section 2.10 and of each Lender’s portion of any
converted or continued Borrowing. If the Borrower shall not have given notice in
accordance with this Section 2.10 to continue any Borrowing into a subsequent
Interest Period (and shall not otherwise have given notice in accordance with
this Section 2.10 to convert such Borrowing), such Borrowing shall, at the end
of the Interest Period applicable thereto (unless repaid pursuant to the terms
hereof), automatically be converted into an ABR Borrowing.

SECTION 2.11. Repayment of Term Borrowings. (a) The Borrower shall pay to the
Administrative Agent, for the account of the Lenders, on the last Business Day
of each March, June, September and December commencing with the quarter ending
December 31, 2011 (each such date being called a “Term Loan Repayment Date”), a
principal amount of the Term Loans (as adjusted from time to time pursuant to
Sections 2.12 and 2.13(g)) equal to 0.25% of the aggregate principal amount of
all Term Loans outstanding on the Closing Date, together in each case with
accrued and unpaid interest on the principal amount to be paid to but excluding
the date of such payment.

(b) To the extent not previously paid, all Term Loans shall be due and payable
on the Term Loan Maturity Date, or, if any such day is not a Business Day, on
the next preceding Business Day, respectively, together with accrued and unpaid
interest on the principal amount to be paid to but excluding the date of
payment.

(c) All repayments pursuant to this Section 2.11 shall be subject to
Section 2.16, but shall otherwise be without premium or penalty.

(d) Unless the Administrative Agent shall have received notice from the Borrower
prior to the date on which any payment is due to the Administrative Agent for
the account of the Lenders hereunder that the Borrower will not make

 

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such payment, the Administrative Agent may assume that the Borrower has made
such payment on such date in accordance herewith and may, in reliance upon such
assumption, distribute to the Lenders the amount due. In such event, if the
Borrower has not in fact made such payment, then each of the Lenders severally
agrees to repay to the Administrative Agent forthwith on demand the amount so
distributed to such Lender, with interest thereon, for each day from and
including the date such amount is distributed to it to but excluding the date of
payment to the Administrative Agent, at the greater of the Federal Funds
Effective Rate and a rate determined by the Administrative Agent in accordance
with banking industry rules on interbank compensation.

SECTION 2.12. Voluntary Prepayment. (a) The Borrower shall have the right at any
time and from time to time to prepay any Borrowing, in whole or in part, upon at
least three Business Days’ prior written or fax notice (or telephone notice
promptly confirmed by written or fax notice) in the case of Eurodollar Term
Loans, or written or fax notice (or telephone notice promptly confirmed by
written or fax notice) at least one Business Day prior to the date of prepayment
in the case of ABR Term Loans, to the Administrative Agent before 1:00 p.m.,
New York City time; provided, however, that each partial prepayment shall be in
an amount that is not less than $5,000,000.

(b) Except as otherwise expressly provided in a notice of prepayment delivered
by the Borrower pursuant to Section 2.12(a), voluntary prepayments of Term Loans
shall be applied in direct order of maturity against the remaining scheduled
installments of principal due in respect of the Term Loans under Section 2.11.

(c) Each notice of prepayment shall specify the prepayment date, the principal
amount of each Borrowing (or portion thereof) to be prepaid and the manner in
which such prepayment shall be applied, shall be irrevocable and shall commit
the Borrower to prepay such Borrowing by the amount stated therein on the date
stated therein; provided, however, that if such prepayment is for all of the
then outstanding Term Loans, then the Borrower may revoke such notice and/or
extend the prepayment date by not more than five Business Days; provided
further, however, that the provisions of Section 2.16 shall apply with respect
to any such revocation or extension. All prepayments under this Section 2.12
shall be subject to Section 2.12(d) and Section 2.16 but otherwise without
premium or penalty. All prepayments under this Section 2.12 shall be accompanied
by accrued and unpaid interest on the principal amount to be prepaid to but
excluding the date of payment.

(d) In the event all or any portion of the Term Loans are (i) repaid through any
voluntary repayments, (ii) repriced (or effectively refinanced) through any
amendment of this Agreement (and such amendment results in a reduction of the
interest rates on such Term Loans) or (iii) prepaid pursuant to Section 2.13(a),
(b), (d), (e) or (f) (but solely in the case of Section 2.13(f) in any principal
amounts prepaid in excess of $100,000,000 in the aggregate), in each case (A) on
or prior to the second anniversary of the Closing Date, such repayments or
repricings will be made with a prepayment premium in an amount (the “Yield
Maintenance

 

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Amount”) equal to the present value of the sum of (I) the Applicable Margin that
would have been payable for Eurodollar Term Loans plus (II) the greater of
(1) the Adjusted LIBO Rate “floor” (i.e. 1.50%) and (2) the Adjusted LIBO Rate
(assuming an Interest Period of three months in effect on the date on which the
applicable notice of repayment or repricing is given), in each case calculated
as a rate per annum on the amount of the principal of such Term Loans repaid or
repriced from the date of such repayment or repricing until the second
anniversary of the Closing Date plus (III) the call premium on the amount of the
principal of such Term Loans repaid or repriced that would have been payable on
such Term Loans had such repayment or repricing been made after the second
anniversary of the Closing Date but on or prior to the third anniversary of the
Closing Date (in each case, computed on the basis of actual days elapsed over a
year of 360 days and using a discount rate equal to the Treasury Rate as of such
prepayment date plus 50 basis points) or (B) after the second anniversary of the
Closing Date but prior to the fourth anniversary of the Closing Date, such
repayments or repricings will be made with a prepayment premium equal to
(x) 2.0% of the principal amount repaid or repriced if such repayment or
repricing occurs after the second anniversary of the Closing Date, but on or
prior to the third anniversary of the Closing Date and (y) 1.0% of the principal
amount repaid or repriced if such repayment or repricing occurs after the third
anniversary of the Closing Date but on or prior to the fourth anniversary of the
Closing Date.

(e) Notwithstanding anything to the contrary contained in this Agreement, so
long as no Default or Event of Default has occurred and is continuing or would
result therefrom, the Borrower or its Affiliates may repurchase outstanding Term
Loans on the following basis (or as otherwise permitted pursuant to
Section 9.04):

(i) at any time when no Default or Event of Default shall have occurred and be
continuing, Affiliates of the Borrower (other than Intermediate Holdings and its
subsidiaries) may purchase all or any portion of the Term Loans of one or more
Lenders pursuant to an Assignment and Assumption between such Affiliate and such
Lender or Lenders in an aggregate principal amount not to exceed (when combined
with all prior purchases pursuant to this clause (i)), 25% of the Term Loans
then outstanding (such purchasing Affiliate, an “Affiliated Lender”); provided
that, with respect to such repurchases, (A) the Borrower shall simultaneously
cause such Affiliated Lender to provide a copy of such Assignment and Assumption
and any other agreements between such Affiliated Lender and such Lender with
respect to such purchase to the Administrative Agent, (B) such Affiliated Lender
shall represent that, as of the date of such purchase, it is not in possession
of any information regarding the Borrower or its Subsidiaries, or the assets of
the Borrower or any Subsidiary, the ability of the Borrower or any Subsidiary to
perform its Obligations or any other matter that may be material to a decision
by any Lender to sell its Term Loans to such Affiliate or to enter into any
Assignment and Assumption or any of the transactions contemplated thereby that
has not previously been disclosed to the Administrative Agent and the Lenders
(other than Lenders that have declined to receive “private-side” information
posted for Lenders who elect to receive the

 

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same), (C) such Affiliated Lender shall agree and acknowledge that it shall not
be permitted to attend any meeting (live, by any electronic means or
otherwise) with the Administrative Agent or any other Lender or receive any
information from the Administrative Agent or any other Lender or provided to the
Administrative Agent or any other Lender by the Borrower (other than the right
to receive notices of prepayments and other administrative notices in respect of
its Term Loans required to be delivered to the Lenders pursuant to Article II)
and shall not have access to any Platform established for the Credit Facilities
or any Communications, (D) notwithstanding anything to the contrary, any
Affiliated Lender may at any time forgive (without any direct or indirect
consideration from Intermediate Holdings or any of its subsidiaries (other than
Equity Interests of Intermediate Holdings)) or contribute (as consideration for
additional Equity Interests of Intermediate Holdings or as an additional
contribution to the capital of Intermediate Holdings together with the
substantially concurrent cancellation by the Borrower of all Indebtedness
represented by such Term Loans) any or all of the Indebtedness represented by
such Term Loans as evidenced by a written instrument delivered to the
Administrative Agent and (E) notwithstanding anything contained herein or in any
other Loan Document to the contrary, no Affiliated Lender shall be permitted to
make or bring any claim, in its capacity as a Lender, against any Agent or any
other Lender with respect to the rights and duties of such Person under the Loan
Documents; for the avoidance of doubt, the limitations set forth in this
Section 2.12(e) shall not apply to Qualified Debt Investors;

(ii) in addition, at any time when no Default or Event of Default shall have
occurred and be continuing, the Borrower may conduct one or more modified Dutch
auctions (each, an “Auction”) to repurchase all or any portion of the Term Loans
(such Term Loans, the “Offer Loans”) of Lenders managed exclusively by the
Administrative Agent or another investment bank or commercial bank of recognized
standing selected by the Borrower (in such capacity, the “Auction Manager”);
provided that, (A) the Borrower delivers a notice of the Term Loans that will be
subject to such Auction to the Administrative Agent (for distribution to the
Lenders) no later than 1:00 p.m. (New York City time) at least five Business
Days in advance of a proposed consummation date of such Auction indicating
(1) the date on which the Auction will conclude, (2) the maximum principal
amount of Term Loans the Borrower is willing to purchase in the Auction and
(3) the range of discounts or premiums to par at which the Borrower would be
willing to repurchase the Offer Loans; (B) the maximum dollar amount of the
Auction shall be no less than an aggregate $10,000,000 or an integral multiple
of $1,000,000 in excess thereof; (C) the Borrower shall hold the Auction open
for a minimum period of two Business Days; (D) a Lender who elects to
participate in the Auction may choose to tender all or part of such Lender’s
Offer Loans; (E) the Auction shall be made to Lenders holding the Offer Loans on
a pro rata basis in proportion to their Term Loans; and (F) the Auction shall be
conducted pursuant to such procedures as the Auction Manager may establish,
which are consistent with this Section 2.12(e) and are reasonably acceptable to
the

 

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Borrower and the Administrative Agent, that a Lender must follow in order to
have its Offer Loans repurchased;

(iii) with respect to all repurchases made by the Borrower pursuant to this
Section 2.12(e), (A) as of the date of such repurchase of Term Loans, the
aggregate of all unrestricted cash and unrestricted Permitted Investments of the
Borrower and the Subsidiaries is at least $50,000,000, (B) the Borrower shall
pay to the applicable assigning Lender all accrued and unpaid interest, if any,
on the repurchased Term Loans to the date of repurchase of such Term Loans,
(C) the repurchase of such Term Loans by the Borrower shall be deducted from the
calculation of Excess Cash Flow to the extent provided in the definition
thereof, (D) the Borrower shall represent that, as of the launch date of the
related Auction and the effective date of any Assignment and Assumption, it is
not in possession of any information regarding the Borrower, its Subsidiaries or
its Affiliates, or the assets of the Borrower or any Subsidiary, the ability of
the Borrower or any Subsidiary to perform its Obligations or any other matter
that may be material to a decision by any Lender to participate in any Auction
or enter into any Assignment and Assumption or any of the transactions
contemplated thereby and that has not previously been disclosed to the
Administrative Agent and the Lenders (other than Lenders that have declined to
receive “private-side” information posted for Lenders who elect to receive the
same) and (E) such repurchases shall not be deemed to be voluntary prepayments
pursuant to this Section 2.12, Section 2.17 or Section 2.19 except that the
amount of the Term Loans so repurchased shall be applied on a pro rata basis to
reduce the scheduled remaining installments of principal on such Term Loan; and

(iv) following any repurchase by the Borrower (but not any Affiliated Lender)
pursuant to this Section 2.12(e), the Term Loans so repurchased shall, without
further action by any Person, be deemed cancelled for all purposes and no longer
outstanding (and may not be resold by the Borrower), for all purposes of this
Agreement and all other Loan Documents, including, but not limited to (A) the
making of, or the application of, any payments to the Lenders under this
Agreement or any other Loan Document, (B) the making of any request, demand,
authorization, direction, notice, consent or waiver under this Agreement or any
other Loan Document or (C) the determination of Required Lenders, or for any
similar or related purpose, under this Agreement or any other Loan Document. In
connection with any Term Loans repurchased and cancelled pursuant to this
Section 2.12(e), the Administrative Agent is authorized to make appropriate
entries in the Register to reflect any such cancellation. Any payment made by
the Borrower in connection with a repurchase permitted by this Section 2.12(e)
shall not be subject to the provisions of either Section 2.19(a) or
Section 2.17. Failure by the Borrower to make any payment to a Lender required
by an agreement permitted by this Section 2.12(e) shall not constitute an Event
of Default under Article VII(b).

SECTION 2.13. Mandatory Prepayments. (a) Not later than the fifth Business Day
following the receipt of Net Cash Proceeds in respect of any Asset Sale, the

 

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Borrower shall apply 100% of the Net Cash Proceeds received with respect thereto
to prepay outstanding Term Loans in accordance with Section 2.13(g).

(b) In the event and on each occasion that any Equity Issuance (other than any
Equity Issuances to the extent the Net Cash Proceeds of the same are used to
make permanent repayments or repurchases of Term Loans by the Borrower), occurs,
the Borrower shall, substantially simultaneously with (and in any event not
later than the third Business Day next following), apply an amount equal to 50%
of the Net Cash Proceeds therefrom to prepay outstanding Term Loans in
accordance with Section 2.13(g) provided, that, with respect to the Net Cash
Proceeds of any Equity Issuances, if (x) the Borrower shall deliver a
certificate of a Financial Officer to the Administrative Agent at the time of
receipt thereof (or promptly thereafter) setting forth the Borrower’s intent to
invest such proceeds in Capital Expenditures permitted herein within 6 months of
receipt of such proceeds and (y) no Event of Default shall have occurred and
shall be continuing at the time of such certificate, the Borrower shall not be
required to apply such amounts to the prepayment of the outstanding Term Loans
pursuant to this clause (b) except to the extent such proceeds are not so
invested or contractually committed to be so invested by the end of such 6 month
period, at which time such proceeds shall be applied to the prepayment of the
outstanding Term Loans pursuant to this clause (b); provided further that (x) if
any portion of such proceeds are not so used within such 6 month period but
within such 6-month period are contractually committed to be used, then upon the
termination of such contract (or if any such proceeds are not so used within 18
months of initial receipt), such remaining portion shall be applied to the
prepayment of the outstanding Term Loans pursuant to this clause (b) as of the
earlier of the date of such termination or expiry of such 18-month period and
(y) such proceeds shall be applied to the prepayment of the outstanding Term
Loans pursuant to this clause (b) notwithstanding any investment notice if there
is an Event of Default at the time of a proposed investment unless such proposed
investment is made pursuant to a binding commitment entered into at a time when
no Event of Default was continuing.

(c) No later than the earlier of (i) 90 days after the end of each fiscal year
of the Borrower, commencing with the fiscal year ending on December 31, 2012,
and (ii) the date on which the financial statements with respect to such period
are delivered pursuant to Section 5.04(a), the Borrower shall apply an amount
equal to 100% of Excess Cash Flow for the fiscal year then ended to prepay
outstanding Term Loans in accordance with Section 2.13(g).

(d) In the event that any Loan Party or any subsidiary of a Loan Party shall
receive Net Cash Proceeds from the issuance or incurrence of Indebtedness for
money borrowed of any Loan Party or any subsidiary of a Loan Party (other than
any cash proceeds from the issuance of Indebtedness for money borrowed permitted
pursuant to Section 6.01), the Borrower shall, substantially simultaneously with
(and in any event not later than the Business Day next following) the receipt of
such Net Cash Proceeds by such Loan Party or such

 

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subsidiary, apply an amount equal to 100% of such Net Cash Proceeds to prepay
outstanding Term Loans in accordance with Section 2.13(g).

(e) In the event that any Loan Party shall receive Net Cash Proceeds from any
Extraordinary Receipt, such Loan Party shall, substantially simultaneously with
(and in any event not later than the Business Day next following) the receipt of
such Net Cash Proceeds by such Loan Party, apply an amount equal to 100% of such
Net Cash Proceeds to prepay outstanding Term Loans in accordance with
Section 2.13(g).

(f) In the event that the Borrower, in its sole discretion, determines to
permanently reduce the Collateral Posting Amount other than in connection with
the reduction of the commitments under or termination of the Indebtedness
incurred pursuant to, Sections 6.01(h) and (i), the Borrower shall, not later
than the third Business Day following such determination, apply 100% of the
amount of such reduction to the prepayment of the outstanding Term Loans in
accordance with Section 2.13(g).

(g) Mandatory prepayments of outstanding Term Loans under this Agreement shall
be applied (i) in direct order of maturity with respect to the next four
remaining scheduled installments of principal due in respect of the Term Loans
under Section 2.11(a) and (ii) pro rata thereafter.

(h) The Borrower shall deliver to the Administrative Agent, at the time of each
prepayment required under this Section 2.13, (i) a certificate signed by a
Financial Officer of the Borrower setting forth in reasonable detail the
calculation of the amount of such prepayment and (ii) to the extent practicable,
at least three Business Days prior written notice of such prepayment. Each
notice of prepayment shall specify the prepayment date, the Type of each Term
Loan being prepaid and the principal amount of each Term Loan (or portion
thereof) to be prepaid. All prepayments of Borrowings under this Section 2.13
shall be subject to Section 2.16, but shall otherwise be without premium or
penalty (except as provided in Section 2.12(d)), and shall be accompanied by
accrued and unpaid interest on the principal amount to be prepaid to but
excluding the date of payment.

SECTION 2.14. Reserve Requirements; Change in Circumstances. (a) Notwithstanding
any other provision of this Agreement, if any Change in Law shall:

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

(ii) subject any Lender to any Tax of any kind whatsoever with respect to this
Agreement or any Eurodollar Term Loan made by it, or change the basis of
taxation of payments in respect thereof (except for Indemnified Taxes or Other

 

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Taxes indemnified pursuant to Section 2.20 and the imposition of any Excluded
Tax payable by such Lender); or

(iii) impose on any Lender or the London interbank market any other condition,
cost or expense affecting this Agreement or Eurodollar Term Loans made by such
Lender;

and the result of any of the foregoing shall be to increase the cost to such
Lender of making, converting to, continuing or maintaining any Eurodollar Term
Loan or of maintaining its obligation to make any such Term Loan, or to increase
the cost to such Lender, or to reduce the amount of any sum received or
receivable by such Lender hereunder (whether of principal, interest or any other
amount) then, upon request of such Lender, the Borrower will pay to such Lender,
as the case may be, such additional amount or amounts as will compensate such
Lender, as the case may be, for such additional costs incurred or reduction
suffered.

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

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

(d) Failure or delay on the part of any Lender to demand compensation pursuant
to this Section shall not constitute a waiver of such Lender’s right to demand
such compensation; provided that the Borrower shall not be required to
compensate a Lender pursuant to this Section for any increased costs incurred or
reductions suffered more than three months prior to the date that such Lender
notifies the Borrower of the Change in Law giving rise to such increased costs
or reductions, and of such Lender’s intention to claim compensation therefor
(except that, if the Change in Law giving rise to such increased costs or
reductions is retroactive, then the three-month period referred to above shall
be extended to include the period of retroactive effect thereof). The protection
of this Section shall be available to each Lender regardless of any possible
contention of the invalidity or inapplicability of the Change in Law that shall
have occurred or been imposed.

 

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SECTION 2.15. Change in Legality. (a) Notwithstanding any other provision of
this Agreement, if any Change in Law shall make it unlawful for any Lender to
make or maintain any Eurodollar Term Loan or to give effect to its obligations
as contemplated hereby with respect to any Eurodollar Term Loan, then, by
written notice to the Borrower and to the Administrative Agent:

(i) such Lender may declare that Eurodollar Term Loans will not thereafter (for
the duration of such unlawfulness) be made by such Lender hereunder (or be
continued for additional Interest Periods) and ABR Term Loans will not
thereafter (for such duration) be converted into Eurodollar Term Loans,
whereupon any request for a Eurodollar Borrowing (or to convert an ABR Borrowing
to a Eurodollar Borrowing or to continue a Eurodollar Borrowing for an
additional Interest Period) shall, as to such Lender only, be deemed a request
for an ABR Term Loan (or a request to continue an ABR Term Loan as such for an
additional Interest Period or to convert a Eurodollar Term Loan into an ABR Term
Loan, as the case may be), unless such declaration shall be subsequently
withdrawn; and

(ii) such Lender may require that all outstanding Eurodollar Term Loans made by
it be converted to ABR Term Loans, in which event all such Eurodollar Term Loans
shall be automatically converted to ABR Term Loans as of the effective date of
such notice as provided in paragraph (b) below.

In the event any Lender shall exercise its rights under (i) or (ii) above, all
payments and prepayments of principal that would otherwise have been applied to
repay the Eurodollar Term Loans that would have been made by such Lender or the
converted Eurodollar Term Loans of such Lender shall instead be applied to repay
the ABR Term Loans made by such Lender in lieu of, or resulting from the
conversion of, such Eurodollar Term Loans.

(b) For purposes of this Section 2.15, a notice to the Borrower by any Lender
shall be effective as to each Eurodollar Term Loan made by such Lender, if
lawful, on the last day of the Interest Period then applicable to such
Eurodollar Term Loan; in all other cases such notice shall be effective on the
date of receipt by the Borrower.

SECTION 2.16. Breakage. The Borrower shall indemnify each Lender against any
loss or expense (but not loss of profits) that such Lender may sustain or incur
as a consequence of (a) any event, other than a default by such Lender in the
performance of its obligations hereunder, which results in (i) such Lender
receiving or being deemed to receive any amount on account of the principal of
any Eurodollar Term Loan prior to the end of the Interest Period in effect
therefor, (ii) the conversion of any Eurodollar Term Loan to an ABR Term Loan,
or the conversion of the Interest Period with respect to any Eurodollar Term
Loan, in each case other than on the last day of the Interest Period in effect
therefor, or (iii) any Eurodollar Term Loan to be made by such Lender (including
any Eurodollar Term Loan to be made pursuant to a conversion or continuation
under Section 2.10) not being made after notice of such Term Loan shall have
been given by

 

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the Borrower hereunder (any of the events referred to in this clause (a) being
called a “Breakage Event”) or (b) any default in the making of any prepayment
required to be made hereunder after notice of such prepayment has been delivered
by the Borrower. A certificate of any Lender setting forth any amount or amounts
which such Lender is entitled to receive pursuant to this Section 2.16 shall be
delivered to the Borrower and shall be conclusive absent manifest error.

SECTION 2.17. Pro Rata Treatment. Except as required under Sections 2.12(e),
2.15 and 2.22, each Borrowing, each payment or prepayment of principal of any
Borrowing, each payment of interest on the Term Loans, each reduction of the
Term Loan Commitments and each conversion of any Borrowing to or continuation of
any Borrowing as a Borrowing of any Type shall be allocated pro rata among the
Lenders in accordance with their respective Term Loan Commitments (or, if such
Term Loan Commitments shall have expired or been terminated, in accordance with
the respective principal amounts of their outstanding Term Loans). Each Lender
agrees that in computing such Lender’s portion of any Borrowing to be made
hereunder, the Administrative Agent may, in its discretion, round each Lender’s
percentage of such Borrowing to the next higher or lower whole Dollar amount.

SECTION 2.18. Sharing of Setoffs. If any Lender shall, by exercising any right
of setoff or counterclaim or otherwise, obtain payment in respect of any
principal of or interest on any of its Term Loans or other obligations hereunder
resulting in such Lender receiving payment of a proportion of the aggregate
amount of its Term Loans and accrued interest thereon or other such obligations
greater than its pro rata share thereof as provided herein, then the Lender
receiving such greater proportion shall (a) notify the Administrative Agent of
such fact, and (b) purchase (for cash at face value) participations in the Term
Loans and such other obligations of the other Lenders, or make such other
adjustments as shall be equitable, so that the benefit of all such payments
shall be shared by the Lenders ratably in accordance with the aggregate amount
of principal of and accrued interest on their respective Term Loans and other
amounts owing them; provided that, (i) if any such participations are purchased
and all or any portion of the payment giving rise thereto is recovered, such
participations shall be rescinded and the purchase price restored to the extent
of such recovery, without interest and (ii) the provisions of this paragraph
shall not be construed to apply to (x) any payment made by the Borrower pursuant
to and in accordance with the express terms of this Agreement, or (y) any
payment obtained by a Lender as consideration for the assignment of or sale of a
participation in any of its Term Loans to any assignee or participant, other
than Intermediate Holdings or any subsidiary thereof, unless permitted pursuant
to Section 2.12(e), (as to which the provisions of this paragraph shall apply).
Each Loan Party consents to the foregoing and agrees, to the extent it may
effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against each
Loan Party rights of setoff and counterclaim with respect to such participation
as fully as if such Lender were a direct creditor of each Loan Party in the
amount of such participation.

SECTION 2.19. Payments. (a) The Borrower shall make each payment (including
principal of or interest on any Borrowing or any Administrative Agent Fees or

 

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other amounts) hereunder and under any other Loan Document not later than
1:00 p.m., New York City time, on the date when due in immediately available
Dollars, without setoff, defense or counterclaim. Any amounts received after
such time on any date may, in the discretion of the Administrative Agent, be
deemed to have been received on the next succeeding Business Day for purposes of
calculating interest thereon. Each such payment shall be made to the
Administrative Agent at its offices at Eleven Madison Avenue, New York, NY
10010. The Administrative Agent shall promptly distribute to each Lender any
payments received by the Administrative Agent on behalf of such Lender.

(b) Except as otherwise expressly provided herein, whenever any payment
(including principal of or interest on any Borrowing or any Administrative Agent
Fees or other amounts) hereunder or under any other Loan Document shall become
due, or otherwise would occur, on a day that is not a Business Day, such payment
may be made on the next succeeding Business Day, and such extension of time
shall in such case be included in the computation of interest or Administrative
Agent Fees, if applicable.

SECTION 2.20. Taxes. (a) Any and all payments by or on account of any obligation
of the Borrower or any other Loan Party hereunder or under any other Loan
Document shall be made free and clear of and without deduction or withholding
for any Taxes; provided that, if any Indemnified Taxes (including any Other
Taxes) shall be required to be deducted or withheld from such payments, then
(i) the sum payable by the Borrower or any other Loan Party shall be increased
as necessary so that after making all required deductions or withholdings
(including deductions or withholdings applicable to additional sums payable
under this Section) the Administrative Agent, each Lender or other recipient of
such payment, as the case may be, receives an amount equal to the sum it would
have received had no such deductions or withholdings been made, (ii) the
Borrower or such Loan Party shall make such deductions or withholdings and
(iii) the Borrower or such Loan Party shall pay the full amount deducted to the
relevant Governmental Authority in accordance with applicable law.

(b) Without limiting the provisions of paragraph (a) above, the Borrower shall
timely pay any Other Taxes to the relevant Governmental Authority in accordance
with applicable law.

(c) The Loan Parties shall jointly and severally indemnify the Administrative
Agent and each Lender, within 10 days after written demand therefor, for the
full amount of any Indemnified Taxes or Other Taxes by or on account of any
obligation of the Borrower or any other Loan Party hereunder or under any other
Loan Document (including Indemnified Taxes or Other Taxes imposed or asserted on
or attributable to amounts payable under this Section) paid by the
Administrative Agent or such Lender, as the case may be, and any penalties,
interest and reasonable expenses arising therefrom or with respect thereto,
whether or not such Indemnified Taxes or Other Taxes were correctly or legally
imposed or asserted by the relevant Governmental Authority. A certificate as to
the amount of such payment or

 

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liability delivered to the Borrower by a Lender, or by the Administrative Agent
on behalf of itself or a Lender, shall be conclusive absent manifest error.

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

(e) Any Foreign Lender that is entitled to an exemption from or reduction of
withholding tax with respect to payments under any Loan Document shall deliver
to the Borrower and the Administrative Agent, at the time or times prescribed by
applicable law, such properly completed and executed documentation prescribed by
applicable law and reasonably requested by the Borrower or the Administrative
Agent as will permit such payments to be made without or at a reduced rate of
withholding. In addition, any Foreign Lender, if reasonably requested by the
Borrower or the Administrative Agent, shall deliver such other documentation
prescribed by applicable law or reasonably requested by the Borrower or the
Administrative Agent as will enable the Borrower or the Administrative Agent to
determine whether or not such Lender is subject to backup withholding or
information reporting requirements. Without limiting the generality of the
foregoing, any Foreign Lender shall deliver to the Borrower and the
Administrative Agent (in such number of copies as shall be requested by the
recipient) on or prior to the date on which such Foreign Lender becomes a Lender
under this Agreement (and from time to time thereafter promptly upon the
expiration, obsolescence or invalidity of any previously delivered form or
information or upon the request of the Borrower or the Administrative Agent, but
in each case only if such Foreign Lender is legally entitled to do so),
whichever of the following is applicable:

(i) duly completed copies of IRS Form W-8BEN claiming eligibility for benefits
of an income tax treaty to which the United States of America is a party and
such W-8BEN shall establish (x) with respect to payments of interest under any
Loan Document an exemption from, or reduction of, U.S. federal withholding Tax
pursuant to the “interest” article of such tax treaty and (y) with respect to
any other applicable payments under any Loan Document, an exemption from, or
reduction of, U.S. federal withholding Tax pursuant to the “business profits” or
“other income” article of such tax treaty,

(ii) duly completed copies of IRS Form W-8ECI,

(iii) duly completed copies of IRS Form W-8EXP,

 

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(iv) duly completed copies of IRS Form W-IMY, together with any required
attachments,

(v) in the case of a Foreign Lender claiming the benefits of the exemption for
portfolio interest under section 871(h) or section 881(c) of the Code, (x) a
certificate substantially in the form of Exhibit I-1 to the effect that such
Foreign Lender is not a “bank” within the meaning of Section 881(c)(3)(A) of the
Code, a “10-percent shareholder” of the Borrower within the meaning of
Section 881(c)(3)(B) of the Code, or a “controlled foreign corporation”
described in Section 881(c)(3)(C) of the Code (a “U.S. Tax Compliance
Certificate”), and (y) duly completed copies of IRS Form W-8BEN,

(vi) to the extent a Foreign Lender is not the beneficial owner, executed
originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN, a
U.S. Tax Compliance Certificate substantially in the form of Exhibit I-2 or
Exhibit I-3, IRS Form W-9, and/or other certification documents from each
beneficial owner, as applicable; provided that if the Foreign Lender is a
partnership and one or more direct or indirect partners of such Foreign Lender
are claiming the portfolio interest exemption, such Foreign Lender may provide a
U.S. Tax Compliance Certificate substantially in the form of Exhibit I-4 on
behalf of each such direct or indirect partner, or

(vii) any other form prescribed by applicable law as a basis for claiming
exemption from or a reduction in United States Federal withholding tax duly
completed together with such supplementary documentation or information
necessary to permit the Borrower or the Administrative Agent to determine the
withholding or deduction required to be made.

(f) Any Lender that is not a Foreign Lender shall deliver to the Borrower and
the Administrative Agent (in such number of copies as shall be requested by the
recipient) on or prior to the date on which such Lender becomes a Lender under
this Agreement (and from time to time thereafter promptly upon the expiration,
obsolescence or invalidity of any previously delivered form or information or
upon the request of the Borrower or the Administrative Agent, but in each case
only if such Lender is legally entitled to do so) duly completed copies of IRS
Form W-9 or other forms or information establishing an exemption from U.S.
backup withholding.

(g) If a payment made to a Lender under any Loan Document hereunder may be
subject to U.S. federal withholding tax under FATCA, such Lender shall deliver
to Borrower and the Administrative Agent, at the time or times prescribed by law
and at such time or times reasonably requested by Borrower or the Administrative
Agent, such documentation prescribed by applicable law and such additional
documentation reasonably requested by Borrower or the Administrative Agent to
comply with its withholding obligations, to determine that such Lender has
complied with such Lender’s obligations under FATCA or to determine the amount
to deduct and withhold

 

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from such payment. Solely for purposes of this Section 2.20(g), the term “FATCA”
shall include any amendments to FATCA after the date hereof.

(h) If a Lender determines, in its sole discretion, that it has received a
refund of any Indemnified Taxes or Other Taxes as to which it has been
indemnified by a Loan Party or with respect to which a Loan Party has paid
additional amounts pursuant to this Section 2.20, it shall pay to the relevant
Loan Party an amount equal to such refund (but only to the extent of indemnity
payments made, or additional amounts paid, by a Loan Party under this Section
with respect to the Indemnified Taxes or Other Taxes giving rise to such
refund), net of all out-of-pocket expenses of such Lender and without interest
(other than any interest paid by the relevant Governmental Authority with
respect to such refund); provided that the relevant Loan Party, upon the request
of the Administrative Agent or such Lender, agrees to repay the amount paid over
to the relevant Loan Party (plus any penalties, interest or other charges
imposed by the relevant Governmental Authority) to such Lender in the event the
such Lender is required to repay such refund to such Governmental Authority.
This paragraph shall not be construed to require the Administrative Agent or any
Lender to make available its Tax returns (or any other information relating to
its Taxes that it deems confidential) to the Borrower or any other Person.

SECTION 2.21. Assignment of Term Loans Under Certain Circumstances; Duty to
Mitigate. (a) If any Lender delivers a certificate requesting compensation
pursuant to Section 2.14 or any Lender delivers a notice described in
Section 2.15, the Borrower is required to pay any additional amount to any
Lender or any Governmental Authority on account of any Lender pursuant to
Section 2.20, and, in each case, such Lender has declined or is unable to
designate a different lending office in accordance with Section 2.21(b), or if
any Lender is a Defaulting Lender or a Non-Consenting Lender, then the Borrower
may, at its sole expense and effort, upon notice to such Lender and the
Administrative Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in
Section 9.04), all of its interests, rights and obligations under this Agreement
and the related Loan Documents to an Eligible Assignee that shall assume such
obligations (which assignee may be another Lender, if a Lender accepts such
assignment); provided that:

(i) the Borrower shall have paid to the Administrative Agent the assignment fee
(if any) specified in Section 9.04;

(ii) such Lender shall have received payment of an amount equal to the
outstanding principal of its Term Loans, accrued interest thereon, accrued fees
and all other amounts payable to it hereunder and under the other Loan Documents
(including any amounts under Sections 2.14 and 2.16 and, if applicable, the
prepayment fee pursuant to Section 2.12(d) (with such assignment being deemed to
be an voluntary prepayment for purposes of determining the applicability of
Section 2.12(d), such amount to be payable by the Borrower)) from the assignee
(to the extent of such outstanding principal and accrued interest and fees) or
the Borrower (in the case of all other amounts);

 

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(iii) in the case of any such assignment resulting in such Lender’s claim for
compensation under Section 2.14, notice under Section 2.15 or the amounts paid
pursuant to Section 2.20, as the case may be, such assignment will result in a
reduction in such compensation, consequences or payments thereafter;

(iv) such assignment does not conflict with applicable law; and

(v) in the case of any assignment resulting from a Lender becoming a
Non-Consenting Lender, the applicable assignee shall have consented to the
applicable amendment, waiver or consent.

A Lender shall not be required to make any such assignment or delegation if,
prior thereto, as a result of a waiver by such Lender or otherwise, the
circumstances entitling the Borrower to require such assignment and delegation
cease to apply.

(b) If any Lender shall request compensation under Section 2.14, any Lender
delivers a notice described in Section 2.15 or the Borrower is required to pay
any additional amount to any Lender or any Governmental Authority on account of
any Lender pursuant to Section 2.20, then such Lender shall (at the request of
the Borrower) use reasonable efforts to designate a different lending office for
funding or booking its Term Loans hereunder or to assign its rights and
obligations hereunder to another of its offices, branches or affiliates, if, in
the judgment of such Lender, such designation or assignment (i) would reduce its
claims for compensation under Section 2.14 or enable it to withdraw its notice
pursuant to Section 2.15 or would reduce amounts payable pursuant to
Section 2.20, as the case may be, in the future, and (ii) would not subject such
Lender to any unreimbursed cost or expense and would not otherwise be
disadvantageous to such Lender. The Borrower hereby agrees to pay all reasonable
costs and expenses incurred by any Lender in connection with any such
designation or assignment.

SECTION 2.22. Extensions of Term Loans.

(a) The Borrower may from time to time, pursuant to the provisions of this
Section 2.22, agree with one or more Lenders holding Term Loans of any Class to
extend the maturity date, and otherwise modify the economic terms of any such
Class or any portion thereof (including, without limitation, by increasing the
interest rate or fees payable and/or modifying the amortization schedule in
respect of any Term Loans of such Class or any portion thereof (each such
modification an “Extension”) pursuant to one or more written offers (each an
“Extension Offer”) made from time to time by the Borrower to all Lenders under
any Class that is proposed to be extended under this Section 2.22), in each case
on a pro rata basis (based on the relative principal amounts of the outstanding
Term Loans of each Lender in such Class) and on the same terms to each such
Lender. In connection with each Extension, the Borrower will provide
notification to the Administrative Agent (for distribution to the Lenders of the
applicable Class), no later than 30 days prior to the maturity of the applicable
Class or Classes to be extended of

 

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the requested new maturity date for the extended Term Loans of each such Class
(each an “Extended Maturity Date”) and the due date for Lender responses. In
connection with any Extension, each Lender of the applicable Class wishing to
participate in such Extension shall, prior to such due date, provide the
Administrative Agent with a written notice thereof in a form reasonably
satisfactory to the Administrative Agent. Any Lender that does not respond to an
Extension Offer by the applicable due date shall be deemed to have rejected such
Extension. After giving effect to any Extension, the Term Loans so extended
shall cease to be a part of the Class they were a part of immediately prior to
the Extension and shall be a new Class hereunder.

(b) Each Extension shall be subject to the following:

(i) no Default or Event of Default shall have occurred and be continuing at the
time any Extension Offer is delivered to the Lenders or at the time of such
Extension;

(ii) except as to interest rates, fees, scheduled amortization and final
maturity date (which shall, subject to clause (iii) below, be determined by the
Borrower and set forth in the relevant Extension Offer), the Term Loans of any
Lender extended pursuant to any Extension shall have the same terms as the Class
of Term Loans subject to the related Extension Offer; provided that at no time
shall there be more than three different Classes of Term Loans;

(iii) the final maturity date of any Term Loans of a Class to be extended
pursuant to an Extension shall be later than the final maturity date of such
Class, and the weighted average life to maturity of any Term Loans of a Class to
be extended pursuant to an Extension shall be no shorter than the weighted
average life to maturity of such Class;

(iv) if the aggregate principal amount of Term Loans of a Class in respect of
which Lenders shall have accepted an Extension Offer exceeds the maximum
aggregate principal amount of Term Loans of such Class offered to be extended by
the Borrower pursuant to the relevant Extension Offer, then such Term Loans of
such Class shall be extended ratably up to such maximum amount based on the
relative principal amounts thereof (not to exceed any Lender’s actual holdings
of record) with respect to which such Lenders accepted such Extension Offer;

(v) all documentation in respect of such Extension shall be consistent with the
foregoing, and all written communications by the Borrower generally directed to
the applicable Lenders under the applicable Class in connection therewith shall
be in form and substance consistent with the foregoing and otherwise reasonably
satisfactory to the Administrative Agent; and

(vi) any applicable Minimum Extension Condition (as defined below) shall be
satisfied;

 

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(c) If at the time any Extension of Term Loans (as so extended, “Current
Extension Loans”) becomes effective, any other Class remains outstanding, then,
if the Weighted Average Yield applicable to any such Current Extension Loans
exceeds the Weighted Average Yield applicable to such other Class by more than
0.50%, then the Weighted Average Yield applicable to such other Class shall be
increased so that it equals the Weighted Average Yield applicable to the Current
Extension Loans (calculated as provided above) less 0.50%.

(d) The consummation and effectiveness of any Extension will be subject to a
condition set forth in the relevant Extension Offer (a “Minimum Extension
Condition”) with respect to a minimum amount (to be determined in the Borrower’s
discretion and specified in the relevant Extension Offer, but in no event less
than $25,000,000, unless another amount is agreed to by the Administrative
Agent). For the avoidance of doubt, it is understood and agreed that the
provisions of Section 2.18 and Section 9.06 will not apply to Extensions of Term
Loans pursuant to Extension Offers made pursuant to and in accordance with the
provisions of this Section 2.22, including to any payment of interest or fees in
respect of any Term Loans that have been extended pursuant to an Extension at a
rate or rates different from those paid or payable in respect of Terms Loans of
any other Class, in each case as is set forth in the relevant Extension Offer.

(e) The Lenders hereby irrevocably authorize the Administrative Agent to enter
into amendments (collectively, “Extension Amendments”) to this Agreement and the
other Loan Documents as may be necessary in order establish new Classes of Term
Loans created pursuant to an Extension, in each case on terms consistent with
this Section 2.22. Notwithstanding the foregoing, the Administrative Agent shall
have the right (but not the obligation) to seek the advice or concurrence of the
Required Lenders with respect to any matter contemplated by this Section 2.22
and, if the Administrative Agent seeks such advice or concurrence, the
Administrative Agent shall be permitted to enter into such amendments with the
Borrower in accordance with any instructions received from such Required Lenders
and shall also be entitled to refrain from entering into such amendments with
the Borrower unless and until it shall have received such advice or concurrence;
provided, however, that whether or not there has been a request by the
Administrative Agent for any such advice or concurrence, all such Extension
Amendments entered into with the Borrower by the Administrative Agent hereunder
shall be binding on the Lenders. Without limiting the foregoing, in connection
with any Extensions, the appropriate Loan Parties shall (at their expense) amend
(and the Administrative Agent is hereby directed to amend) any Mortgage (or any
other Loan Document that Administrative Agent or Collateral Trustee reasonably
requests to be amended to reflect an Extension) that has a maturity date prior
to the latest Extended Maturity Date so that such maturity date is extended to
the then latest Extended Maturity Date (or such later date as may be advised by
local counsel to the Administrative Agent).

(f) In connection with any Extension, the Borrower shall provide the
Administrative Agent at least ten Business Days’ (or such shorter period as may
be

 

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agreed by the Administrative Agent) prior written notice thereof, and shall
agree to such procedures, if any, as may be reasonably established by, or
acceptable to, the Administrative Agent to accomplish the purposes of this
Section 2.22.

ARTICLE III

Representations and Warranties

Each of Intermediate Holdings and the Borrower represents and warrants to the
Administrative Agent, the Collateral Trustee and each of the Lenders that, as of
the Closing Date:

SECTION 3.01. Organization; Powers. Intermediate Holdings, the Borrower and each
of the Subsidiaries (a) is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its organization, (b) has all requisite
power and authority to own its property and assets and to carry on its business
as now conducted and as proposed to be conducted except where the failure to
have such power and authority would not reasonably be expected to have a
Material Adverse Effect, (c) is qualified to do business in, and is in good
standing in, every jurisdiction where such qualification is required, except
where the failure so to qualify or be in good standing would not reasonably be
expected to result in a Material Adverse Effect, and (d) has the power and
authority to execute, deliver and perform its obligations under each of the Loan
Documents to which it is or will be a party and, in the case of the Borrower, to
borrow hereunder.

SECTION 3.02. Authorization. The Transactions (a) have been duly authorized by
all requisite corporate and, if required, stockholder action and (b) will not
(i) violate (A) any provision of law, statute, rule or regulation (except to the
extent that the violation of any provision of law, statute, rule or regulation
would not reasonably be expected to result in a Material Adverse Effect), or of
the certificate or articles of incorporation or other constitutive documents or
by-laws of any Loan Party, (B) any material order of any Governmental Authority
or (C) any provision of any material indenture, agreement or other instrument to
which such Loan Party is a party or by which any of them or any of their
property is or may be bound, (ii) be in conflict with, result in a breach of or
constitute (alone or with notice or lapse of time or both) a default under, or
give rise to any right to accelerate or to require the prepayment, repurchase or
redemption of any obligation under any such indenture, agreement or other
instrument or (iii) result in the creation or imposition of any Lien upon or
with respect to any property or assets now owned or hereafter acquired by any
Loan Party (other than any Lien created hereunder or under the Security
Documents).

SECTION 3.03. Enforceability. This Agreement has been duly executed and
delivered by Intermediate Holdings and the Borrower and constitutes, and each
other Loan Document when executed and delivered by each Loan Party party thereto
will constitute, a legal, valid and binding obligation of such Loan Party
enforceable against such Loan Party in accordance with its terms, except to the
extent that the enforceability thereof may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium

 

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or other similar laws generally affecting creditors’ rights and by equitable
principles (regardless of whether enforcement is sought in equity or at law).

SECTION 3.04. Governmental Approvals. No action, consent or approval of,
registration or filing with or any other action by any Governmental Authority is
or will be required in connection with the Loan Documents or the Reorganization,
except for (a) the filing of Uniform Commercial Code financing statements and,
to the extent they are necessary, filings with the United States Patent and
Trademark Office and the United States Copyright Office, as applicable,
(b) recordation of the Mortgages and (c) such as have been made or obtained and
are in full force and effect.

SECTION 3.05. Financial Statements. (a) The Borrower has heretofore furnished to
the Lenders (i) consolidated balance sheets and related statements of income,
stockholders’ equity and cash flows of the Parent as of and for the fiscal year
ended December 31, 2010, audited by and accompanied by the opinion of Ernst &
Young LLP, independent public accountants and (ii) consolidated balance sheets
and related statements of income and cash flows of the Parent as of and for the
fiscal quarter and the portion of the fiscal year ended March 31, 2011,
certified by its chief financial officer. Such financial statements present
fairly the financial condition and results of operations and cash flows of the
Parent and its consolidated subsidiaries as of such dates and for such periods.
Such balance sheets and the notes thereto disclose all material liabilities,
direct or contingent, of the Parent and its consolidated subsidiaries as of the
dates thereof. Such financial statements were prepared in accordance with GAAP
applied on a consistent basis, subject, in the case of unaudited financial
statements, to year-end audit adjustments and the absence of footnotes.

(b) As of the Closing Date, internally generated unaudited operating information
comprised of adjusted EBITDA, gross margin, operating and maintenance expenses,
and capital expenditures for the Borrower and its Subsidiaries for the preceding
three years delivered to the Joint Lead Arrangers pursuant to paragraph (m)(v)
of Article IV were prepared by the Borrower in good faith on the basis of
assumptions which the Borrower believed were reasonable in light of the
conditions existing at the time of delivery.

(c) As of the Closing Date, the pro forma consolidated balance sheet and related
pro forma consolidated statements of income of the Parent and its subsidiaries
as of, and for the twelve-month period ending on, March 31, 2011, prepared after
giving effect to the Transactions, the GasCo Transactions and the Reorganization
undertaken by the Parent prior to the Closing Date, as if the Transactions and
such Reorganization had occurred as of such date (in the case of such balance
sheet) or at the beginning of such period (in the case of such other statements
of income) delivered to the Joint Lead Arrangers pursuant to paragraph (m)(iii)
of Article IV were, to the knowledge of the Borrower, prepared by the Parent in
good faith on the basis of assumptions which the Borrower believed were
reasonable in light of the conditions existing at the time of delivery.

 

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(d) As of the Closing Date, the projections delivered to the Joint Lead
Arrangers pursuant to paragraph (m)(iv) of Article IV were prepared by the
Parent in good faith on the basis of assumptions which the Borrower believed
were reasonable in light of the conditions existing at the time of delivery,
provided, each of the Borrower and Intermediate Holdings represents only, with
respect to the projections in this clause (iii), that it acted in good faith and
utilized reasonable assumptions (based substantially upon accounting principles
consistent with the historical audited financial statements of the Parent in all
material respects other than (i) the Vermillion Facility shutdown costs and
(ii) other material items identified in writing to the Joint Lead Arrangers
prior to July 11, 2011) in the preparation of such projected financial
statements.

SECTION 3.06. No Material Adverse Change. No event, change or condition has
occurred that has had, or would reasonably be expected to have, a material
adverse effect on the business, assets, liabilities, operations, condition
(financial or otherwise) or operating results of Intermediate Holdings, the
Borrower and the Subsidiaries, taken as a whole, since December 31, 2010 (after
giving effect to the Transactions, as if such Transaction had occurred as of
December 31, 2010).

SECTION 3.07. Title to Properties; Possession Under Leases. (a) As of the
Closing Date, each of Intermediate Holdings, the Borrower and the Subsidiaries
has good and marketable title to, or valid leasehold interests in, all its
material properties and assets (including all Mortgaged Property), except for
defects in title that do not materially interfere with its ability to conduct
its business as currently conducted or to utilize such properties and assets for
their intended purposes. All such material properties and assets are free and
clear of Liens, other than Liens expressly permitted by Section 6.02.

(b) As of the Closing Date, each Loan Party has complied with all obligations
under all leases to which it is a party and all such leases are in full force
and effect other than such non-compliance or breach which would not reasonably
be expected to have a Material Adverse Effect. Each Loan Party enjoys peaceful
and undisturbed possession under all such leases other than such non-compliance
or breach which would not reasonably be expected to have a Material Adverse
Effect.

(c) As of the Closing Date, neither Intermediate Holdings nor the Borrower has
received any notice of, nor has any knowledge of, any pending or contemplated
condemnation proceeding affecting the Mortgaged Properties or any sale or
disposition thereof in lieu of condemnation.

(d) As of the Closing Date, except as set forth on Schedule 3.07, no Loan Party
is obligated under any right of first refusal, option or other contractual right
to sell, assign or otherwise dispose of any Mortgaged Property or any interest
therein.

SECTION 3.08. Subsidiaries. Schedule 3.08 sets forth as of the Closing Date a
list of all Subsidiaries and the percentage ownership interest of Intermediate
Holdings or

 

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the Borrower therein. The shares of capital stock or other ownership interests
so indicated on Schedule 3.08 are fully paid and non-assessable and are owned by
Intermediate Holdings, the Borrower or a Subsidiary, directly or indirectly,
free and clear of all Liens (other than Liens created under the Security
Documents) and the non-consensual liens expressly permitted by Section 6.02.

SECTION 3.09. Litigation; Compliance with Laws. (a) Except as set forth on
Schedule 3.09, there are no actions, suits or proceedings at law or in equity or
by or before any Governmental Authority now pending against or affecting
Intermediate Holdings or the Borrower or any Subsidiary or any business,
property or rights of any such Person (i) that involve any Loan Document or the
Transactions or (ii) as to which there is a reasonable probability of an adverse
determination and that, if adversely determined, would reasonably be expected,
individually or in the aggregate, to result in a Material Adverse Effect.

(b) As of the Closing Date, none of Intermediate Holdings, the Borrower or any
of the Subsidiaries or any of their respective material properties or assets is
in violation of, nor will the continued operation of their material properties
and assets as currently conducted violate, any law, rule or regulation
(including any zoning, building, ordinance, code or approval or any building
permits) or any restrictions of record or agreements affecting the Mortgaged
Property, or is in default with respect to any judgment, writ, injunction,
decree or order of any Governmental Authority, where such violation or default
would reasonably be expected to result in a Material Adverse Effect.

SECTION 3.10. Agreements. (a) None of Intermediate Holdings, the Borrower or any
of the Subsidiaries is a party to any agreement or instrument or subject to any
corporate restriction that has resulted or would reasonably be expected to
result in a Material Adverse Effect.

(b) None of Intermediate Holdings, the Borrower or any of the Subsidiaries is in
default in any manner under any provision of any indenture or other agreement or
instrument evidencing Indebtedness, or any other material agreement or
instrument to which it is a party or by which it or any of its properties or
assets are or may be bound, where such default would reasonably be expected to
result in a Material Adverse Effect.

SECTION 3.11. Federal Reserve Regulations. (a) No Loan Party is engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose of buying or carrying Margin Stock.

(b) No part of the proceeds of any Term Loan will be used, whether directly or
indirectly, and whether immediately, incidentally or ultimately, for any purpose
that entails a violation of, or that is inconsistent with, the provisions of the
Regulations of the Board, including Regulation T, U or X.

 

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SECTION 3.12. Investment Company Act. No Loan Party is an “investment company”
as defined in, or subject to regulation under, the Investment Company Act of
1940.

SECTION 3.13. Use of Proceeds. The proceeds of the Term Loans will be used by
the Borrower on the Closing Date (a) to cash collateralize letters of credit,
whether existing on the Closing Date or issued thereafter for the account of the
Borrower or any of its Subsidiaries, (b) to make a $200,000,000 Restricted
Payment to Intermediate Holdings (which will make a Restricted Payment in an
equal amount to Holdings) within five Business Days following the Closing Date,
(c) to pay transaction fees and expenses, (d) for general corporate purposes
(including amounts required to repay the Existing Credit Facility) and (e) for
the other purposes on the Closing Date set forth in the statement of sources and
uses of funds delivered pursuant to paragraph (n) of Article IV. Proceeds of
Term Loans, to the extent in excess of the immediate needs described in the
preceding sentence, may be held as cash or Permitted Investments until used by
the Borrower for the purposes described above, the making of Restricted Payments
on the terms and conditions contained herein and other general corporate
purposes.

SECTION 3.14. Tax Returns. Each of the material Federal, state, local and
foreign Tax returns required to have been filed by or on behalf of Intermediate
Holdings, the Borrower and the Subsidiaries have been timely filed and all
material Taxes due and payable with respect thereto have been timely paid,
except Taxes that are being contested in good faith by appropriate proceedings
and for which Intermediate Holdings, the Borrower or such Subsidiary, as
applicable, shall have set aside on its books adequate reserves in accordance
with GAAP.

SECTION 3.15. No Material Misstatements. None of (a) the Confidential
Information Memorandum or (b) any other information, report, financial
statement, exhibit or schedule (when taken as a whole) furnished by or on behalf
of Intermediate Holdings or the Borrower to the Administrative Agent or any
Lender on or prior to the Closing Date in connection with the negotiation of any
Loan Document or included therein or delivered pursuant thereto contained,
contains or will contain on the date on which such information is furnished any
untrue statement of material fact or omitted, omits or will omit to state any
material fact necessary to make the statements therein, in the light of the
circumstances under which they were, are or will be made, not misleading;
provided that to the extent any such information, report, financial statement,
exhibit or schedule was based upon or constitutes a forecast or projection, each
of Intermediate Holdings and the Borrower represents only that it acted in good
faith and utilized reasonable assumptions (based substantially upon accounting
principles consistent with the historical audited financial statements of the
Parent in all material respects other than (i) the Vermillion Facility shutdown
costs and (ii) other material items identified in writing to the Joint Lead
Arrangers on or prior to July 11, 2011) in the preparation of such financial
statements in all material respects in light of the conditions existing at the
time of delivery thereof in the preparation of such information, report,
financial statement, exhibit or schedule, it being recognized by the Lenders,
that forecasts or projections as to future events are not to be viewed as facts
or a guarantee of future performance and that the actual results during the
period or periods covered by the

 

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forecasts or projections may differ from the projected results included in such
forecasts or projections, which differences may be material. Notwithstanding
anything to the contrary in the preceding sentence, no representation, warranty
or covenant is made with respect to information of general economic or general
industry nature or for which the source is any separately identified (i) third
party source or (ii) other person or entity not affiliated with or acting as
agent or representative for Intermediate Holdings, the Borrower or any of the
Subsidiaries, and, in each case such information was not provided to such
source, other person or entity by the Borrower or its Subsidiaries.

SECTION 3.16. Employee Benefit Plans. Except as disclosed in any Public
Disclosure, each of the Borrower and its ERISA Affiliates is in compliance with
the applicable provisions of ERISA and the Code and the regulations and
published interpretations thereunder with respect to each Plan and has performed
all of its obligations under each Plan, except in each such case where any
failure to so comply or perform would not result in a Material Adverse Effect.
Each Plan which is intended to qualify under Section 401(a) of the Code has
received a favorable determination letter from the Internal Revenue Service
indicating that such Plan is so qualified or is comprised of a master or
prototype plan that has received a favorable opinion letter from the Internal
Revenue Service, and to the knowledge of the Borrower, nothing has occurred
subsequent to the issuance of such determination letter which would cause such
Plan to lose its qualified status. Except as would not reasonably be expected to
result in a Material Adverse Effect, no liability to the PBGC (other than
required premium payments), the Internal Revenue Service, or, except in the
ordinary course, any Plan or any trust established thereunder has been or is
reasonably expected to be incurred by the Borrower or any of their respective
ERISA Affiliates with respect to any Plan. No ERISA Event has occurred or is
reasonably expected to occur that, when taken together with all other such ERISA
Events, would reasonably be expected to result in a Material Adverse Effect. The
present value of all benefit liabilities under each Plan (based on the
assumptions used for purposes of Statement of Financial Accounting Standards
No. 87) did not, as of the last annual valuation date applicable thereto
occurring prior to the Closing Date, exceed by more than $45,000,000 the Fair
Market Value of the assets of such Plan, and the present value of all benefit
liabilities of all underfunded Plans (based on the assumptions used for purposes
of Statement of Financial Accounting Standards No. 87) did not, as of the last
annual valuation dates applicable thereto occurring prior to the Closing Date,
exceed by more than $60,000,000 the Fair Market Value of the assets of all such
underfunded Plans.

SECTION 3.17. Environmental Matters. Except as set forth in Schedule 3.17 (or as
expressly disclosed in any Public Disclosure) and except with respect to any
other matters that, individually or in the aggregate, would not reasonably be
expected to result in a Material Adverse Effect, none of Intermediate Holdings,
the Borrower or any of the Subsidiaries (i) has failed to comply with any
applicable Environmental Law or to obtain, maintain or comply with any permit,
license or other approval required under any applicable Environmental Law,
(ii) has become subject to any Environmental Liability, (iii) has received
notice of any claim or investigation with respect to any Environmental Liability
(including, but not limited to, any notice of potential liability or request for
information under Section 104(e) of the federal Comprehensive Environmental
Response,

 

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Compensation, and Liability Act (CERCLA), Section 114 of the federal Clean Air
Act or other similar statutory provisions) that has not been resolved,
(iv) knows of any basis for any Environmental Liability (including any Release
or threatened Release of Hazardous Materials at, on, in or under any of the real
property currently or formerly owned, leased or operated by Intermediate
Holdings, the Borrower or any of the Subsidiaries), or (v) knows of any facts or
circumstances that would reasonably be expected to materially interfere with or
prevent continued compliance with applicable Environmental Laws as presently in
effect.

SECTION 3.18. Insurance. The properties of Intermediate Holdings and its
subsidiaries are insured with financially sound and reputable insurance
companies in such amounts with such deductibles and covering such risks as are
customarily carried by companies engaged in similar businesses and owning
similar properties in localities where Intermediate Holdings and the applicable
subsidiaries operates.

SECTION 3.19. Security Documents. (a) The Guarantee and Collateral Agreement,
upon execution and delivery thereof by the parties thereto, will create in favor
of the Collateral Trustee, for the ratable benefit of the Secured Parties, a
legal, valid and enforceable security interest in the Collateral (as defined in
the Guarantee and Collateral Agreement) and the proceeds thereof and (i) when
the Pledged Collateral (as defined in the Guarantee and Collateral Agreement) is
delivered to the Collateral Trustee, the Lien created under Guarantee and
Collateral Agreement shall constitute a fully perfected first priority Lien on,
and security interest in, all right, title and interest of the Loan Parties in
such Pledged Collateral, in each case prior and superior in right to any other
Person, and (ii) when financing statements in appropriate form are filed in the
offices specified on Schedule 3.19(a), the Lien created under the Guarantee and
Collateral Agreement will constitute a fully perfected Lien on, and security
interest in, all right, title and interest of the Loan Parties in such
Collateral with respect to which security interests may be perfected by filing
UCC financing statements, in each case prior and superior in right to any other
Person, other than with respect to Liens expressly permitted by Section 6.02.

(b) Upon the recordation of the Guarantee and Collateral Agreement (or a
short-form security agreement in form and substance reasonably satisfactory to
the Borrower and the Collateral Trustee) with the United States Patent and
Trademark Office and the United States Copyright Office, as applicable, together
with the financing statements in appropriate form filed in the offices specified
on Schedule 3.19(a), Lien created under the Guarantee and Collateral Agreement
shall constitute a fully perfected Lien on, and security interest in, all right,
title and interest of the Loan Parties in the Intellectual Property (as defined
in the Guarantee and Collateral Agreement) in which a security interest may be
perfected by such filing in the United States and its territories and
possessions, in each case prior and superior in right to any other Person, other
than with respect to Liens expressly permitted by Section 6.02 (it being
understood that subsequent recordings in the United States Patent and Trademark
Office and the United States Copyright Office may be necessary to perfect a Lien
on registered trademarks and patents, trademark

 

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and patent applications and registered copyrights acquired by the Loan Parties
after the Closing Date).

(c) The Mortgages are effective to create in favor of the Collateral Trustee,
for the ratable benefit of the Secured Parties, a legal, valid and enforceable
Lien on all of the applicable Loan Parties’ right, title and interest in and to
the Mortgaged Property thereunder and the proceeds thereof, and when the
Mortgages are recorded or filed, as applicable, in the offices specified on
Schedule 3.19(c), the Mortgages shall constitute a fully perfected Lien on, and
security interest in, all right, title and interest of the applicable Loan
Parties in such Mortgaged Property and the proceeds thereof, in each case prior
and superior in right to any other Person, other than with respect to the rights
of Persons pursuant to Liens expressly permitted by Section 6.02.

SECTION 3.20. Location of Real Property and Leased Premises. Schedule 3.20 lists
completely and correctly as of the Closing Date all the locations where any Loan
Party (a) owns real property (i) subject to a Mortgage or (ii) with a Fair
Market Value in excess of (A) $25,000,000 for each property that is used in
connection with a power generation facility (inclusive of such facility) and
(B) $25,000,000 for each property that is otherwise used in the business of any
Loan Party or (b) leases real property for which the annual rent costs is in
excess of $10,000,000 per lease, in each case exclusive of taxes, insurance
premiums and other operating expenses, excluding office leases.

SECTION 3.21. Labor Matters. As of the date hereof and the Closing Date,
(i) there are no strikes, lockouts or slowdowns against Intermediate Holdings,
the Borrower or any Subsidiary pending or, to the knowledge of Intermediate
Holdings or the Borrower, threatened, (ii) the hours worked by and payments made
to employees of Intermediate Holdings, the Borrower and the Subsidiaries have
not been in violation of the Fair Labor Standards Act or any other applicable
Federal, state, local or foreign law dealing with such matters, (iii) all
payments due from Intermediate Holdings, the Borrower or any Subsidiary, or for
which any claim may be made against Intermediate Holdings, the Borrower or any
Subsidiary, on account of wages and employee health and welfare insurance and
other benefits, have been paid or accrued as a liability on the books of
Intermediate Holdings, the Borrower or such Subsidiary and (iv) the consummation
of the Transactions will not give rise to any right of termination or right of
renegotiation on the part of any union under any collective bargaining agreement
to which Intermediate Holdings, the Borrower or any Subsidiary is bound; in each
case referred to in this Section 3.21, to the extent that failure to do so would
not reasonably be expected to result in a Material Adverse Effect.

SECTION 3.22. Solvency. On and as of the Closing Date, immediately after the
consummation of the Transactions to occur on the Closing Date and immediately
following the making of each Term Loan on the Closing Date and after giving
effect to the application of the proceeds of each such Term Loan, (a) the fair
value of the assets of each of the (i) Borrower individually and (ii) Loan
Parties on a consolidated basis, at a fair valuation, will exceed their
respective debts and liabilities, subordinated, contingent

 

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or otherwise; (b) the present fair saleable value of the property of each of the
(i) Borrower individually and (ii) Loan Parties on a consolidated basis will be
greater than the amount that will be required to pay the probable liability of
their respective debts and other liabilities, subordinated, contingent or
otherwise, as such debts and other liabilities become absolute and matured;
(c) each of the (i) Borrower individually and (ii) Loan Parties on a
consolidated basis will be able to pay their respective debts and liabilities,
subordinated, contingent or otherwise, as such debts and liabilities become
absolute and matured; and (d) each of the (i) Borrower individually and
(ii) Loan Parties on a consolidated basis will not have unreasonably small
capital with which to conduct the respective businesses in which they are
engaged as such business is now conducted and is proposed to be conducted
following the Closing Date.

SECTION 3.23. Transaction Documents and Material Project Documents. Intermediate
Holdings and the Borrower have (a) made available to the Administrative Agent
and its counsel for their review a complete and correct copy of the material
Reorganization Documents (including all schedules, exhibits, amendments,
supplements and modifications thereto) as in effect on the Closing Date, and (b)
delivered to the Administrative Agent a complete and correct copy of the
Material Project Documents as in effect on the Closing Date, and counsel to
Intermediate Holdings and the Borrower has provided to counsel for the
Administrative Agent a summary of the transactions comprising the Reorganization
that is true, accurate and complete in all material respects. No Loan Party or,
to the knowledge of any Loan Party, any other Person party thereto is in default
in the performance or compliance with any material provisions thereof.

SECTION 3.24. Sanctioned Persons. No Loan Party or, to the knowledge of the
Borrower, any director, officer, agent, employee or Affiliate of Intermediate
Holdings, the Borrower or any Subsidiary is currently subject to any U.S.
sanctions administered by the Office of Foreign Assets Control of the U.S.
Treasury Department (“OFAC”); and the Borrower will not directly or indirectly
use the proceeds of the Term Loans or otherwise make available such proceeds to
any Person, for the purpose of financing the activities of any Person currently
subject to any U.S. sanctions administered by OFAC.

SECTION 3.25. Intellectual Property; Licenses, Etc. Each of Intermediate
Holdings, the Borrower and each Subsidiary owns, possesses through ownership or
pursuant to a binding written agreement the right to use, all of the trademarks,
service marks, trade names, Internet domain names, copyrights, patents, patent
rights, proprietary information, trade secrets, franchises, licenses and other
intellectual property rights (collectively, “IP Rights”) that are used in or
reasonably necessary for the operation of its respective businesses, without
conflict with the rights of any other Person, except where the failure to so own
or possess, or such conflict, would not reasonably be expected to have a
Material Adverse Effect. To the knowledge of Intermediate Holdings and the
Borrower, no IP Rights, slogan or other advertising device, product, service,
process, method, substance, part or other material now employed, sold or offered
for sale by any Loan Party or any other Subsidiary infringes upon, violates,
misuses, dilutes or misappropriates any IP Rights held by any other Person,
except for any such infringement, violation, misuse, dilution or
misappropriation that would not reasonably be expected to have a Material
Adverse Effect. None of Intermediate Holdings, the

 

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Borrower or any Subsidiary have received any unresolved or otherwise outstanding
written claim from any Person alleging that any Loan Party or any other
Subsidiary has infringed upon, violated, misused, diluted or misappropriated any
IP Rights held by any other Person, except as would not reasonably be expected
to have a Material Adverse Effect.

SECTION 3.26. Energy Regulation. (a) Except for regulation by FERC under FPA,
PUHCA (as an exempt holding company) and PURPA, none of Intermediate Holdings,
the Borrower or any Subsidiary is subject to regulation as a public utility
holding company, public utility or public service company (or similar
designation) by any Governmental Authority.

(b) Each Loan Party and each other subsidiary that makes sales of electric
energy, capacity or ancillary services (other than any subsidiary that is the
owner of a “qualifying facility” as such term is defined under PURPA and that is
exempt from regulation under Sections 205 and 206 of the FPA pursuant to
18 C.F.R. § 292.601) has received an order from FERC granting it
(i) authorization to make wholesale sales of electric energy, capacity and
ancillary services at market-based rates and (ii) such waivers and blanket
authorizations as are customarily granted to entities with market-based rate
authority, including blanket authorization to issue securities and assume
liabilities pursuant to Section 204 of the FPA, which order is not subject to
any pending challenge, investigation, complaint, or other proceeding, except as
would not reasonably be expected to result in a Material Adverse Effect and
other than generic proceedings generally applicable in the industry, and FERC
has not imposed any rate caps, mitigation measures, potential refunds or other
limits on such market-based rate sales, other than (x) rate caps and mitigation
measures generally applicable to similarly situated marketers or generators
selling electricity, capacity, or ancillary services at market-based rates in
the relevant geographic markets or (y) restrictions imposed through
“reliability-must-run” agreements or similar agreements with independent system
operators or regional transmission organizations.

(c) All “qualifying facilities” (if any) owned by any Loan Party or any other
subsidiary continue to meet the eligibility requirements for “qualifying
facilities” under PURPA and related regulations, except where failure to meet
such eligibility requirements would not reasonably be expected to have a
Material Adverse Effect. All “exempt wholesale generators” and “foreign utility
companies” (if any) owned by any Loan Party or any other subsidiary continue to
meet the requirements for “exempt wholesale generators” and “foreign utility
companies” under PUHCA and related regulations, except where failure to meet
such requirements could not reasonably be expected to have a Material Adverse
Effect.

SECTION 3.27. Sole Purpose of Intermediate Holdings. Intermediate Holdings has
been formed solely for the purpose of owning Equity Interests in the Borrower
and engaging in transactions contemplated by this Agreement, and, as of the
Closing Date, has not engaged in any business activity other than the
negotiation,

 

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execution and to the extent applicable, performance of this Agreement and the
transactions contemplated by the Loan Documents and the Reorganization
Documents. As of the Closing Date, Intermediate Holdings is not party to any
agreements other than the Reorganization Documents to which it is a party and
the Loan Documents.

SECTION 3.28. Deposit Accounts and Securities Accounts. Other than the deposit
accounts and securities accounts set forth on Schedule 3.28, neither the
Borrower nor the Subsidiary Guarantors has any deposit accounts and securities
accounts other than the accounts permitted pursuant to Section 6.16(b).

SECTION 3.29. Easements; Utilities; Services. As of the Closing Date, and except
as would not reasonably be expected to result in a Material Adverse Effect, all
easements, leasehold and other similar property interests, and all utility and
other services (including, to the extent applicable, gas, electrical, water and
sewage services and facilities), means of transportation, facilities, other
materials and other rights, that are necessary for the operation and maintenance
of the Borrower’s or its Subsidiaries’ Projects in accordance in all material
respects with all applicable law and regulations and the Loan Documents are
available to the Borrower or the applicable Subsidiary.

SECTION 3.30. Permits. As of the Closing Date, except as disclosed in
Schedule 3.30 or as would not reasonably be expected to result in a Material
Adverse Effect, all material Permits with respect to the ownership, leasing,
use, operation and maintenance of each Project that are currently required to be
obtained have been issued and are in full force and effect and not subject to
legal proceedings or to any unsatisfied conditions that would reasonably be
expected to result in a material modification or revocation, and all applicable
cure and appeal periods, as applicable, with respect thereto have expired.

SECTION 3.31. Property Rights. The Borrower and its Subsidiaries own, or have
the right to use, all property, and have agreements in place (including pursuant
to any Material Project Documents), as are reasonably necessary for the
operation of their businesses, in each case except as would not reasonably be
expected to have a Material Adverse Effect.

ARTICLE IV

Conditions of Lending

The obligations of the Lenders to make Term Loans on the Closing Date are
subject to the satisfaction of the following conditions:

(a) The Administrative Agent shall have received, on behalf of itself and the
Lenders, a written opinion of (i) White & Case LLP, counsel for Intermediate
Holdings and the Borrower, in form and substance reasonably satisfactory to the
Joint Lead Arrangers and provided to the Lenders, (ii) White & Case LLP, counsel
for Intermediate Holdings and the Borrower, addressing bankruptcy
non-consolidation issues in form and substance reasonably satisfactory to the
Joint Lead

 

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Arrangers and provided to the Lenders, (iii) Richards, Layton & Finger, a
Professional Association, special Delaware counsel for Intermediate Holdings and
the Borrower, addressing Independent Manager provisions of the limited liability
company agreements of Intermediate Holdings and the Borrower and (iv) each local
counsel listed on Schedule 4(a), substantially to the effect set forth in
Exhibit G-3, in each case (A) dated the Closing Date, (B) addressed to the
Administrative Agent, the Collateral Trustee and the Lenders and (C) covering
such other matters relating to the Loan Documents and the Transactions as the
Administrative Agent shall reasonably request, and Intermediate Holdings and the
Borrower hereby request such counsel to deliver such opinions.

(b) The Administrative Agent shall have received (i) a copy of the certificate
or articles of incorporation, including all amendments thereto, of each Loan
Party, certified as of a recent date by the Secretary of State of the state of
its organization, and a certificate as to the good standing of each Loan Party
as of a recent date, from such Secretary of State; (ii) a certificate of the
Secretary or Assistant Secretary of each Loan Party dated the Closing Date and
certifying (A) that attached thereto is a true and complete copy of the by-laws
of such Loan Party as in effect on the Closing Date and at all times since a
date prior to the date of the resolutions described in clause (B) below,
(B) that attached thereto is a true and complete copy of resolutions duly
adopted by the board of directors of such Loan Party authorizing the execution,
delivery and performance of the Loan Documents to which such Person is a party
and, in the case of the Borrower, the borrowings hereunder, and that such
resolutions have not been modified, rescinded or amended and are in full force
and effect, (C) that the certificate or articles of incorporation of such Loan
Party have not been amended since the date of the last amendment thereto shown
on the certificate of good standing furnished pursuant to clause (i) above, and
(D) as to the incumbency and specimen signature of each officer executing any
Loan Document or any other document delivered in connection herewith on behalf
of such Loan Party; (iii) a certificate of another officer as to the incumbency
and specimen signature of the Secretary or Assistant Secretary executing the
certificate pursuant to clause (ii) above; and (iv) such other documents as the
Lenders or the Administrative Agent may reasonably request.

(c) The Administrative Agent shall have received a certificate, dated the
Closing Date and signed by a Financial Officer of the Borrower, confirming
compliance with the conditions precedent set forth in paragraphs (y) and (z) of
Article IV.

(d) The Administrative Agent shall have received all Administrative Agent Fees
and all other costs, fees, expenses (including legal fees and expenses, title
premiums, survey charges and recording taxes and fees) and other compensation
contemplated by the Transactions payable to the Administrative Agent or the
Joint Lead Arrangers, the Co-Manager or the Lenders to the extent due and to the
extent a reasonably detailed invoice has been delivered to the Borrower at least
three business days prior to the Closing Date.

 

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(e) The Security Documents shall have been duly executed by each Loan Party that
is to be a party thereto and shall be in full force and effect on the Closing
Date. The Collateral Trustee on behalf of the Secured Parties shall have a
security interest in the Collateral of the type and priority described in each
Security Document.

(f) The Collateral Trustee shall have received a Perfection Certificate with
respect to the Loan Parties dated the Closing Date and duly executed by a
Responsible Officer of Intermediate Holdings and the Borrower, and shall have
received the results of (i) a search of the Uniform Commercial Code filings (or
equivalent filings) made with respect to the Loan Parties in the states (or
other jurisdictions) of formation of such Persons, in which the chief executive
office of each such Person is located and in the other jurisdictions in which
such Persons maintain property, in each case as indicated on such Perfection
Certificate; and (ii) a search of the title records of the United States Patent
and Trademark Office and the United States Copyright Office or agencies with
respect to IP Rights indicated as registered or issued therefrom on such
Perfection Certificate, together with copies of the financing statements (or
similar documents) disclosed by such search, and accompanied by evidence
satisfactory to the Collateral Trustee that the Liens indicated in any such
financing statement (or similar document) would be permitted under Section 6.02
or have been or will be contemporaneously released or terminated.

(g) (i) Each of the Mortgages relating to each Mortgaged Property set forth on
Schedule 1.01(c) shall have been duly executed by the applicable Loan Party
thereto and delivered to the Collateral Trustee and shall be in full force and
effect, (ii) each of such Mortgaged Properties shall not be subject to any Lien
other than those permitted under Section 6.02, (iii) each of such Mortgages
shall have been filed and recorded in the recording office as specified on
Schedule 3.19(c) (or a lender’s title insurance policy, in form and substance
acceptable to the Collateral Trustee, insuring such Mortgages as a first Lien on
such Mortgaged Property, subject to any Lien permitted by Section 6.02, shall
have been received by the Collateral Trustee) and, in connection therewith, the
Collateral Trustee shall have received evidence satisfactory to it of each such
filing and recordation and (iv) the Collateral Trustee shall have received such
other documents, including a policy or policies of title insurance issued by a
nationally recognized title insurance company, together with such endorsements
to the extent applicable and available in the jurisdiction, and, to the extent
necessary, coinsurance and reinsurance with respect to the foregoing items in
this clause (iv) as may be requested by the Collateral Trustee and the Lenders
to insure the Mortgages as valid first liens on the Mortgaged Properties, free
of Liens other than those permitted under Section 6.02, together with such legal
opinions required to be furnished pursuant to the terms of the Mortgages or as
reasonably requested by the Collateral Trustee or the Lenders. In addition, the
Borrower shall have delivered to Administrative Agent a completed Flood
Certificate with respect to each Mortgaged Property to the extent required by
the Flood Program, which Flood Certificate shall: (A) be addressed to the
Administrative Agent; (B) otherwise comply with the Flood

 

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Program; (C) if the Flood Certificate states that the Mortgaged Property is
located in a Flood Zone, the Borrower’s written acknowledgement of receipt of
written notification from the Administrative Agent and (D) if the Mortgaged
Property is located in a Flood Zone and is located in a community that
participates in the Flood Program, evidence that the Borrower has obtained a
policy of flood insurance that is in compliance with all applicable regulations
promulgated under the Flood Program.

(h) The Joint Lead Arrangers shall have received a copy of, or a certificate as
to coverage under, the insurance policies required by Section 5.02 and the
applicable provisions of the Security Documents, each of which shall be endorsed
or otherwise amended to include a customary lender’s loss payable endorsement
and to name the Collateral Trustee as additional insured, in form and substance
satisfactory to the Joint Lead Arrangers.

(i) [Reserved].

(j) Each Joint Lead Arranger shall have received evidence reasonably
satisfactory to it that (i) all amounts outstanding under the Existing Credit
Facility shall have been repaid (or will be repaid upon the receipt by the
Borrower or the proceeds of the Term Loans) and all commitments in respect
thereof shall have been terminated and all Liens securing (x) the Existing
Credit Facility and (y) all other secured interest rate, commodity or other
hedging agreements or arrangements secured by the collateral securing the
Existing Credit Facility (including all Liens granted by Gen Finance (as defined
in the Existing Credit Facility) and its subsidiaries) shall have been released
and all guarantees in respect thereof shall be terminated and released (other
than Liens permitted by Section 6.02) and (ii) Intermediate Holdings, the
Borrower and the Subsidiaries shall have outstanding no Indebtedness or
preferred stock other than (x) the Term Loans and (y) Indebtedness permitted by
Section 6.01.

(k) The Reorganization and the other Transactions contemplated to occur on or
prior to the Closing Date shall be consummated in accordance with applicable law
and on the terms described in the Reorganization Documents and otherwise on
terms and conditions reasonably acceptable to the Joint Lead Arrangers (without
any amendment, modification or waiver thereof or any consent thereunder which is
materially adverse to the Borrower, the Lenders or the Joint Lead Arrangers
without the prior written consent of the Joint Lead Arrangers).

(l) The Joint Lead Arrangers shall have received copies of a report of PA
Consulting Group.

(m) The Joint Lead Arrangers shall have received (i) audited consolidated
balance sheets and related statements of income, stockholders’ equity and cash
flows related to the Parent and its subsidiaries for the three most recently
completed fiscal years ended December 31, 2010, (ii) unaudited consolidated
balance sheets and related statements of income and cash flows related to the

 

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Parent and its subsidiaries, for the fiscal quarter ended March 31, 2011,
(iii) a pro forma consolidated balance sheet and related pro forma consolidated
statements of income of the Parent and its subsidiaries as of, and for the
twelve-month period ending on, March 31, 2011, prepared after giving effect to
the Transactions and the GasCo Transactions as if the Transactions and the GasCo
Transactions had occurred as of such date (in the case of such balance sheet) or
at the beginning of such period (in the case of such other statements of
income), (iv) the projections set forth in the Private Side Supplement dated as
of July 11, 2011 to the Confidential Information Memorandum reflect the
forecasted financial condition of the Borrower and its Subsidiaries after giving
effect to the Transactions, (v) operating information comprised of adjusted
EBITDA, gross margin, operating and maintenance expenses, and capital
expenditures for the Borrower and its Subsidiaries for the three fiscal years
ending December 31, 2010 and each subsequent fiscal quarter ended on March 31,
2011 as provided in the Parent’s Form 8-K filed on July 11, 2011 and (vi) a
statement of sources and uses of the Borrower and the Parent with respect to the
Credit Facilities and the Transactions in form and substance reasonably
satisfactory to the Joint Lead Arrangers.

(n) The Joint Lead Arrangers shall have received (a) a certificate from the
chief financial officer of the Borrower, substantially in the form of Exhibit L,
certifying that the Borrower and its Subsidiaries, on a consolidated basis after
giving effect to the Transactions, the Reorganization and the other transactions
contemplated hereby, are solvent and with supporting documentation reasonably
requested by the Joint Lead Arrangers and (b) a solvency opinion for the
Borrower, in form and substance reasonably satisfactory to the Joint Lead
Arrangers, from Duff & Phelps.

(o) The Joint Lead Arrangers shall be reasonably satisfied in all respects with
the Tax Sharing Agreement among Parent, Intermediate Holdings and its
subsidiaries after giving effect to the Transactions.

(p) The Administrative Agent shall have received a certificate of a Responsible
Officer of the Borrower that all requisite Governmental Authorities and material
third parties shall have approved or consented to the Transactions and the other
transactions contemplated hereby to the extent material and required, all appeal
periods shall have expired and there shall be no governmental, administrative or
judicial action in connection with such approval or consent that would
reasonably be expected to restrain, prevent or impose burdensome conditions on
the Transactions.

(q) The Lenders shall have received, to the extent requested at least five days
prior to the Closing Date, all documentation and other information required by
regulatory authorities under applicable “know your customer” and anti-money
laundering rules and regulations, including the USA PATRIOT Act.

(r) The Joint Lead Arrangers shall have received a certificate of a Responsible
Officer of the Borrower certifying that there shall not have occurred

 

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any event, change or condition since December 31, 2010 (except, in the case of
the Parent and its subsidiaries (other than (x) GasCo and its subsidiaries and
(y) the Borrower and its subsidiaries), as disclosed in writing prior July 7,
2011) that, individually or in the aggregate, has had, or would reasonably be
expected to have, a material adverse effect on the business, assets,
liabilities, operations, condition (financial or otherwise), or operating
results of the Parent and its subsidiaries or of the Borrower and its
Subsidiaries or of GasCo and its subsidiaries, in each case, taken as a whole.

(s) The Joint Lead Arrangers shall have received a certificate of a Responsible
Officer of the Borrower certifying that (x) $1,100,000,000 term loan facilities
of GasCo shall have closed and become effective contemporaneously with the
closing of the Credit Facilities on the Closing Date and (y) on the Closing
Date, GasCo shall have received gross cash proceeds (prior to any reduction for
original issue discount) of not less than $1,100,000,000 from such term loan
facilities.

(t) (i) Intermediate Holdings shall be a newly formed special-purpose,
bankruptcy-remote Delaware limited liability company wholly owned and
controlled, directly or indirectly, by the Parent, (ii) each of Intermediate
Holdings and the Borrower shall have at least one Independent Manager and
(iii) each of Intermediate Holdings and the Borrower shall have customary rating
agency “separateness” provisions reasonably satisfactory to the Administrative
Agent in their respective limited liability company agreements.

(u) (i) Holdings shall be a newly formed special-purpose purpose, bankruptcy
remote entity wholly owned and controlled, directly or indirectly, by the
Parent, (ii) Holdings shall be a corporation or limited liability company
organized under the laws of Delaware and shall hold 100% of the Equity Interests
of Intermediate Holdings and (iii) the Joint Lead Arrangers shall have received
a letter agreement substantially in the form of Exhibit M duly executed and
delivered by Holdings for the benefit of the Agents and the Lenders pursuant to
which Holdings agrees to (A) have at least one Independent Manager, (B) maintain
its books, records and financial statements separate and apart from its
subsidiaries and (C) provide a statement in or with any financial statements it
prepares and distributes that makes clear in its financial statements (in
conformity with GAAP and the rules and regulations of the Securities and
Exchange Commission and acceptable to it and its independent public accountants
that audit its financial statements) that the assets of Intermediate Holdings
and its subsidiaries are not available to the creditors of Holdings or the other
Group Members (other than Intermediate Holdings and its subsidiaries) (or,
alternatively, that such assets are only available for the creditors of
Intermediate Holdings and its subsidiaries).

(v) The Joint Lead Arrangers shall have received a letter agreement
substantially in the form of Exhibit N duly executed and delivered by the Parent
for the benefit of the Agents and the Lenders pursuant to which the Parent will
agree to provide a statement in or with its financial statements that makes
clear in the Parent’s financial statements (in conformity with GAAP and the
rules and

 

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regulations of the Securities and Exchange Commission and acceptable to it and
its independent public accountants that audit its financial statements) that the
assets of Intermediate Holdings and its subsidiaries are not available to the
creditors of the Parent or the other Group Members (other than Intermediate
Holdings and its subsidiaries) (or, alternatively, that such assets are only
available for the creditors of Intermediate Holdings and its subsidiaries).

(w) The Joint Lead Arrangers shall have received a certificate of an Responsible
Officer of DPM substantially in the form of Exhibit O that, after giving effect
to the Reorganization and the other Transactions contemplated to occur on or
prior to the Closing Date (i) DPM’s liabilities to unaffiliated third parties
are in an aggregate amount that does not materially exceed the sum of (x) the
aggregate amount owed to DPM by GasCo and its subsidiaries or the Borrower and
its Subsidiaries under back-to-back arrangements with respect to such
third-party obligations and (y) the amount of letters of credit and cash posted
to secure performance of DPM’s obligations under its agreements with third
parties, (ii) each letter of credit issued under the Existing Credit Facility as
credit support for the obligations of DPM and its subsidiaries has been replaced
with a letter of credit issued under letter of credit facilities of GasCo or the
Borrower and (iii) each of DPM and its material subsidiaries has sufficient
liquidity to pay its debts as such debts come due in the ordinary course of its
business.

(x) The Administrative Agent shall have received a notice of such Borrowing as
required by Section 2.03 (or such notice shall have been deemed given in
accordance with Section 2.02).

(y) The representations and warranties set forth in Article III and in each
other Loan Document shall be true and correct on and as of the Closing Date with
the same effect as though made on and as of such date, except to the extent such
representations and warranties expressly relate to an earlier date.

(z) At the time of and immediately after such Borrowing, no Default or Event of
Default shall have occurred and be continuing.

(aa) The Joint Lead Arrangers shall have received a certificate of a Responsible
Officer of the Borrower substantially in the form of Exhibit P with respect to
the facts and assumptions set forth in the opinion issued by White & Case LLP,
as counsel for Intermediate Holdings, the Borrower and its Subsidiaries in
connection with the Closing Date (and relating to substantive consolidation
issues) provided pursuant to paragraph (a) of this Article IV.

ARTICLE V

Affirmative Covenants

Each of Intermediate Holdings and the Borrower covenants and agrees with each
Lender that so long as this Agreement shall remain in effect and the principal
of and

 

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interest on each Term Loan and all Administrative Agent Fees and all other
expenses or amounts payable under any Loan Document shall have been paid in
full, unless the Required Lenders shall otherwise consent in writing, each of
Intermediate Holdings and the Borrower will, and will cause each of the
Subsidiaries to:

SECTION 5.01. Existence; Compliance with Laws; Businesses and Properties.
(a) Maintain and do or cause to be done all things necessary to preserve, renew
and keep in full force and effect its legal existence except as otherwise
expressly permitted under Section 6.05 or where, in the case of the
Subsidiaries, failure to do so would not reasonably be expected to have a
Material Adverse Effect.

(b) Do or cause to be done all things within its control necessary to:
(i) obtain, preserve, renew, extend and keep in full force and effect the
rights, licenses, permits, franchises, authorizations, patents, copyrights,
trademarks, trade names and other IP Rights material to the conduct of its
business; (ii) maintain and operate such business in substantially the manner in
which it is presently conducted and operated; and (iii) comply in all material
respects with all applicable laws, rules, regulations and decrees and orders of
any Governmental Authority, whether now in effect or hereafter enacted; and at
all times maintain and preserve all property material to the conduct of such
business and keep such property in good repair, working order and condition and
from time to time make, or cause to be made, all needful and proper repairs,
renewals, additions, improvements and replacements thereto necessary in order
that the business carried on in connection therewith may be properly conducted
at all times, in each case to the extent that failure to do, when taken together
with all such failures to comply with this Section 5.01(b), results in or would
reasonably be expected to result in a Material Adverse Effect.

SECTION 5.02. Insurance. (a) Keep its insurable properties adequately insured at
all times by financially sound and reputable insurers (provided, however, that
there shall be no breach of this Section 5.02 if any such insurer becomes
financially unsound and the applicable Loan Party obtains reasonably promptly
insurance coverage from a different financially sound and reputable insurer);
maintain such other insurance with respect to its properties and business
against loss or damage of the kinds customarily insured against by Persons
engaged in the same or similar business, of such types and in such amounts with
reasonable deductibles, limits, retentions and self-insurance (including captive
insurance arrangements consistent with past practices) as are customarily
carried under similar circumstances by such other Persons and providing for not
less than 10 days’ prior notice to the Administrative Agent of termination,
lapse or cancellation of such insurance (other than as a result of non-payment
of premiums) or 10 days’ prior notice to the Administrative Agent of
termination, lapse or cancellation of such insurance as a result of non-payment
of premiums with respect to such insurance; cause all such policies covering any
Collateral to be endorsed or otherwise amended to include a customary lender’s
loss payable endorsement, in form and substance reasonably satisfactory to the
Administrative Agent and the Collateral Trustee; provided that the Collateral
Trustee acknowledges and agrees that it is reasonably satisfied with the
endorsement provided as of the Closing Date; provided further that the Parent
shall be

 

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permitted to comply with the Borrower’s obligations under this Section 5.02 in
lieu of the Borrower so doing.

(b) If at any time the area in which the Premises (as defined in the Mortgages)
are located in a “flood hazard area” in any Flood Insurance Rate Map published
by the Federal Emergency Management Agency (or any successor agency) obtain
flood insurance in such total amount as required pursuant to, and otherwise
comply with, the Flood Program.

SECTION 5.03. Taxes. Pay and discharge promptly when due all Taxes, assessments
and governmental charges or levies imposed upon it or in respect of its income,
profits or property, before the same shall become delinquent or in default,
provided, however, that such payment and discharge shall not be required with
respect to any such Tax, assessment, charge, levy or claim so long as (x) the
validity or amount thereof shall be contested in good faith by appropriate
proceedings and Intermediate Holdings, the Borrower or the relevant Subsidiary
shall have set aside on its books adequate reserves with respect thereto in
accordance with GAAP and such contest operates to suspend collection of the
contested obligation, tax, assessment or charge and, in the case of a Mortgaged
Property, there is no risk of forfeiture of such property or (y) such failure to
pay or discharge would not reasonably be expected to result in a Material
Adverse Effect.

SECTION 5.04. Financial Statements, Reports, etc. In the case of the Borrower,
furnish to the Administrative Agent, which shall furnish to each Lender:

(a) (i) subject to any Financial Statement Margin Increases required pursuant to
Section 2.06(d), for the fiscal year ending December 31, 2011, on or prior to
September 30, 2012 and (ii) for each fiscal year thereafter, by April 15 of the
following fiscal year, its consolidated balance sheet and related statements of
income, stockholders’ equity and cash flows showing the financial condition of
the Borrower and its consolidated Subsidiaries as of the close of such fiscal
year and the results of its operations and the operations of such Subsidiaries
during such fiscal year, together with comparative figures for the immediately
preceding fiscal year commencing with the fiscal year ended December 31, 2013,
all audited by Ernst & Young LLP or other independent public accountants of
recognized national standing and accompanied by an opinion of such accountants
(which opinion shall be without a “going concern” or like qualification or
exception and without any qualification or exception as to the scope of such
audit (other than a “going concern” explanatory note or similar qualification or
exception solely with respect to, or resulting from, the fact that the final
maturity date of any of the Term Loans hereunder is less than one year after the
date of such opinion)) to the effect that such consolidated financial statements
fairly present the financial condition and results of operations of the Borrower
and its consolidated Subsidiaries on a consolidated basis in accordance with
GAAP consistently applied, together with a discussion provision reasonably
acceptable to the Administrative Agent;

 

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(b) (i) subject to any Financial Statement Margin Increases required pursuant to
Section 2.06(d), for each of the fiscal quarters ending September 30, 2011,
March 31, 2012 and June 30, 2012, on or prior to September 30, 2012 and (ii) for
each of the first three fiscal quarters of each fiscal year thereafter, within
60 days after the end of each of the first three fiscal quarters of each fiscal
year, its consolidated balance sheet and related statements of income, and cash
flows showing the financial condition of the Borrower and its consolidated
Subsidiaries as of the close of such fiscal quarter and the results of its
operations and the operations of such Subsidiaries during such fiscal quarter
and the then elapsed portion of the fiscal year, and comparative figures for the
same periods in the immediately preceding fiscal year commencing with the fiscal
year ended December 31, 2013 (or earlier if available), all certified by one of
its Financial Officers as fairly presenting the financial condition and results
of operations of the Borrower and its consolidated Subsidiaries on a
consolidated basis in accordance with GAAP consistently applied, subject to
normal year-end audit adjustments, together with a discussion provision
reasonably acceptable to the Administrative Agent and absence of footnotes;

(c) concurrently with any delivery of financial statements under paragraph (a)
or (b) above, a certificate of a Financial Officer in the form of Exhibit H
(i) certifying that no Event of Default or Default has occurred or, if such an
Event of Default or Default has occurred, specifying the nature and extent
thereof and any corrective action taken or proposed to be taken with respect
thereto, (ii) setting forth computations in reasonable detail reasonably
satisfactory to the Administrative Agent demonstrating compliance with the
covenant contained in Section 6.10 and, in the case of a certificate delivered
with the financial statements required by paragraph (a) above, setting forth the
Borrower’s calculation of Excess Cash Flow and (iii) setting forth the net
mark-to-market position for the Interest Rate/Currency Hedging Agreements and
Eligible Commodity Hedging Agreements, in each case secured by Liens permitted
pursuant to Section 6.02(k), respectively, then outstanding for each
counterparty, as reasonably determined by the Borrower;

(d) if, as a result of any change in accounting principles and policies from
those used in the preparation of the financial statements delivered pursuant to
Section 3.05(a), the consolidated financial statements of the Borrower and its
Subsidiaries delivered pursuant to Section 5.04(a) or 5.04(b) will differ in any
material respect from the consolidated financial statements that would have been
delivered pursuant to such subdivisions had no such change in accounting
principles and policies been made and if (and only if) the Borrower has made a
request as described in the last paragraph of Section 1.02 with respect to one
or more such changes (unless and until an amendment as contemplated by such last
paragraph of Section 1.02 has been approved by the Required Lenders), then,
together with the first delivery of such financial statements after such change,
one or more statements of reconciliation in form and substance reasonably
satisfactory to Administrative Agent;

 

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(e) within 30 days after the beginning of each fiscal year of the Borrower, a
detailed consolidated budget for such fiscal year (including a projected
consolidated balance sheet and related statements of projected operations and
cash flows as of the end of and for such fiscal year and setting forth the
assumptions used for purposes of preparing such budget) and, promptly when
available, any significant revisions of such budget;

(f) promptly after the same become publicly available, copies of all periodic
and other reports, proxy statements and other materials filed by Intermediate
Holdings, the Borrower or any Subsidiary with the Securities and Exchange
Commission, or any Governmental Authority succeeding to any or all of the
functions of said Commission, or with any national securities exchange, or
distributed to its shareholders, as the case may be;

(g) promptly after the receipt thereof by Intermediate Holdings or the Borrower
or any of their respective subsidiaries, a copy of any “management letter”
received by any such Person from its certified public accountants and the
management’s response thereto;

(h) promptly after the request by any Lender, all documentation and other
information that such Lender reasonably requests in order to comply with its
ongoing obligations under applicable “know your customer” and anti-money
laundering rules and regulations, including the USA PATRIOT Act; and

(i) promptly, from time to time, such other information regarding the
operations, business affairs and financial condition of Intermediate Holdings,
the Borrower or any Subsidiary, or compliance with the terms of any Loan
Document, as the Administrative Agent may reasonably request.

Documents required to be delivered pursuant to Section 5.04(a), (b) or (f) (to
the extent any such documents are filed with the Securities and Exchange
Commission) may be delivered electronically and if so delivered, shall be deemed
to have been delivered on the date on which such documents are posted on the
publicly available website of the Securities and Exchange Commission.

SECTION 5.05. Litigation and Other Notices. Furnish to the Administrative Agent
and each Lender prompt written notice of the following promptly after any
Responsible Officer of any Loan Party obtains knowledge thereof:

(a) any Event of Default or Default, specifying the nature and extent thereof
and the corrective action (if any) taken or proposed to be taken with respect
thereto;

(b) the filing or commencement of any action, suit or proceeding, whether at law
or in equity or by or before any Governmental Authority, against the Borrower or
any Affiliate thereof that would reasonably be expected to result in a Material
Adverse Effect; and

 

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(c) any development that has resulted in, or would reasonably be expected to
result in, a Material Adverse Effect;

SECTION 5.06. Information Regarding Collateral. (a) Furnish to the
Administrative Agent prompt written notice of any change (i) in any Loan Party’s
legal name, (ii) in the jurisdiction of organization or formation of any Loan
Party, (iii) in any Loan Party’s identity or legal existence or (iv) in any Loan
Party’s Federal Taxpayer Identification Number. Intermediate Holdings and the
Borrower agree not to effect or permit any change referred to in the preceding
sentence unless all filings have been made under the Uniform Commercial Code or
otherwise that are required in order for the Collateral Trustee to continue at
all times following such change to have a valid, legal and perfected security
interest in all the Collateral. Intermediate Holdings and the Borrower also
agree promptly to notify the Administrative Agent and the Collateral Trustee if
any material portion of the Collateral is damaged or destroyed.

(b) In the case of the Borrower, each year, at the time of delivery of the
annual financial statements with respect to the preceding fiscal year pursuant
to Section 5.04(a), deliver to the Administrative Agent and the Collateral
Trustee a certificate of a Financial Officer setting forth the information
required pursuant to Section 2 of the Perfection Certificate or confirming that
there has been no change in such information, or if there has been any change,
specifying such change, since the date of the Perfection Certificate delivered
on the Closing Date or the date of the most recent certificate delivered
pursuant to this Section 5.06.

(c) Each year at the time of delivery of the annual financial statements with
respect to the preceding fiscal year pursuant to Section 5.04(a), deliver to the
Administrative Agent and the Collateral Trustee a title search by a nationally
recognized title insurance company dated not earlier than December 1 of such
preceding fiscal year for each Mortgaged Property showing no Liens other than
Liens permitted pursuant to Section 6.02.

SECTION 5.07. Maintaining Records; Access to Properties and Inspections. Keep
proper books of record and account in which full, true and correct entries in
conformity with GAAP and all requirements of law are made of all financial
operations. Each Loan Party will permit any representatives designated by the
Administrative Agent to visit and inspect the financial records and the
properties of the Borrower or any other Loan Party at reasonable times, but no
more than twice annually, or, if an Event of Default has occurred and is
continuing, as often as reasonably requested and to make extracts from and
copies of such financial records, and permit any representatives designated by
the Administrative Agent to discuss the affairs, finances and condition of the
Borrower or any other Loan Party with the officers thereof and independent
accountants therefor all at such reasonable times as may be requested; it being
understood, for the avoidance of doubt, that disclosure of any information that
the Borrower reasonably considers to be a trade secret or similar confidential
information is subject to the provisions of Section 9.16.

 

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SECTION 5.08. Use of Proceeds. Use the proceeds of the Term Loans only for the
purposes set forth in Section 3.13.

SECTION 5.09. Employee Benefits. (a) Comply with the applicable provisions of
ERISA and the Code with respect to any Plan, except where failure to so comply
would not reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect and (b) furnish to the Administrative Agent as soon as
possible, and in any event within ten days after the occurrence of any
Responsible Officer of Intermediate Holdings, the Borrower or any ERISA
Affiliate knowing or having reason to know of the forthcoming occurrence of, any
ERISA Event reasonably likely to occur that, alone or together with any other
ERISA Event would reasonably be expected to result in liability of Intermediate
Holdings, the Borrower or any ERISA Affiliate in an aggregate amount exceeding
$35,000,000, a statement of a Financial Officer of Intermediate Holdings or the
Borrower setting forth details as to such ERISA Event the action, if any, that
Intermediate Holdings, the Borrower or the ERISA Affiliate proposes to take with
respect thereto and, when known, any action taken or threatened by the Internal
Revenue Service, the Department of Labor or the PBGC with respect thereto.

SECTION 5.10. Compliance with Environmental Laws. Promptly take any and all
actions within its control necessary to: (a) Comply, and cause all lessees and
other Person occupying its properties to comply, in all material respects with
all Environmental Laws applicable to its operations and properties; (b) obtain
and renew all material environmental permits necessary for its operations and
properties; (c) and conduct any Remedial Action in accordance with Environmental
Laws; (d) promptly take any and all actions necessary to cure any violation of
Environmental Laws; and (e) to make an appropriate response to any claim or
assertion of Environmental Liability against Intermediate Holdings, the Borrower
or any Subsidiary, in each case where failure to comply or take such other
actions would reasonably be expected to have, individually or in the aggregate,
a Material Adverse Effect; provided, however, that none of Intermediate
Holdings, the Borrower or any Subsidiary shall be required to undertake any such
action to the extent that its obligation to do so is being contested in good
faith and by proper proceedings and appropriate reserves are being maintained
with respect to such circumstances in accordance with GAAP.

SECTION 5.11. Environmental Disclosure, Preparation of Environmental Reports and
Access.

(a) Promptly upon the occurrence thereof, provide to the Administrative Agent,
written notice describing in reasonable detail each of the following matters:
(1) any Release that would reasonably be expected to require a Remedial Action
under applicable Environmental Laws or give rise to actual or asserted
Environmental Liability of Intermediate Holdings, the Borrower or any Subsidiary
in excess of $35,000,000, (2) any Remedial Action taken by Intermediate
Holdings, the Borrower or any Subsidiary or any other Person which has a
reasonable possibility of resulting Environmental Liability to Intermediate
Holdings, the Borrower or any Subsidiary in excess of $35,000,000, (3) any
claims or assertions of Environmental Liability against Intermediate Holdings,
the

 

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Borrower or any Subsidiary in excess of $35,000,000, or (4) Intermediate
Holding’s, the Borrower’s or any Subsidiaries’ discovery of any occurrence or
condition on any real property adjoining or in the vicinity of any Project
(including all Mortgaged Property, if any, with respect thereto) that would
cause such Project (including all Mortgaged Property, if any, with respect
thereto) or any part thereof to be subject to any material restrictions on the
ownership, occupancy, transferability or use thereof under any Environmental
Laws, except for any such restriction as would not reasonably be expected to
result in a Material Adverse Effect;

(b) submit to the Administrative Agent an annual written report on the status of
(A) any matter for which written notice was provided pursuant to Section 5.11(a)
and (B) if reasonably requested by the Administrative Agent, other matters
related to non-compliance with Environmental Law, pending or threatened claims
of Environmental Liability, or Remedial Actions that would reasonably be
expected to give rise to liability of or expenditures by Intermediate Holdings,
the Borrower or any Subsidiary in excess of $35,000,000. Such report shall
specify in reasonable detail (1) the status of the matter including any
significant developments since the date of the prior report, (2) any technical
reports or material correspondence prepared or received relating to the matter,
(3) the proposed plan for resolution or completion of the matter, and (4) the
anticipated cost to achieve such resolution or completion of the matter. Reports
shall be submitted annually until such matters have been resolved or determined
no longer to be reasonably expected to give rise to liability of or expenditures
by Intermediate Holdings, the Borrower or any Subsidiary in excess of
$35,000,000 or, in aggregate, result in a Material Adverse Effect;

(c) deliver to Administrative Agent with reasonable promptness, such other
documents and information as may be reasonably requested from time to time by
the Administrative Agent in relation to any matters addressed by Section 5.10 or
this Section 5.11; provided that no Loan Party or its Subsidiaries shall be
obligated to deliver (i) any information and documentation which is subject to
the attorney-client privilege or with respect to which the attorney-client
privilege would be waived if such information or documentation were disclosed to
the Administrative Agent or any Lender, (ii) any information that is subject to
a confidentiality agreement that restricts its disclosure or (iii) any
information that can otherwise not be disclosed due to legal or contractual
restrictions, provided that, to the extent the same will not (as determined by
the Borrower) waive such privilege or breach any such obligations, such Loan
Party or Subsidiary shall provide the Administrative Agent with a notice
generally identifying the nature of the information withheld and shall take all
reasonable steps necessary to provide Administrative Agent with the factual
information contained in any such privileged document; and

(d) with respect to any event described in Section 5.11(a), or if an Event of
Default has occurred and is continuing, or if Administrative Agent reasonably
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any representation, warranty or covenant contained in Sections 3.17 or 5.10 (or
Sections 3.09 or 3.30, in each case, to the extent related to environmental
matters):

(i) allow the Administrative Agent and its representatives to enter any Project
(including all Mortgaged Property, if any, with respect thereto) at reasonable
times and after reasonable notice for the purposes of observing the condition
and operation of such Project (including all Mortgaged Property, if any, with
respect thereto). Such access shall include, at the reasonable request of
Administrative Agent, access to relevant documents and employees of Intermediate
Holdings, the Borrower or any Subsidiary and to their outside representatives,
to the extent necessary to obtain necessary information related to the event at
issue;

(ii) if a Default caused by reason of a breach of Sections 3.17 or 5.10 (or
Sections 3.09 or 3.30, in each case, to the extent related to environmental
matters) shall have occurred and be continuing for more than 20 days without
Intermediate Holdings, the Borrower or any Subsidiary commencing activities
reasonably likely to cure such Default, at the written request of the Required
Lenders through the Administrative Agent, provide to the Lenders within 45 days
after such request, at the expense of the Loan Parties, an environmental
assessment report regarding the matters which are the subject of such Default
prepared by an environmental consulting firm (the firm and the scope of such
investigation to be reasonably acceptable to the Administrative Agent) and
indicating, as relevant, the past or current presence or absence of Hazardous
Materials or the existence of any non-compliance with Environmental Laws,
together with the estimated cost of any compliance or remedial action in
connection with such Default. If an Event of Default has occurred and is
continuing, and if a Loan Party does not undertake such tests and investigations
in a reasonably timely manner following the request of Administrative Agent,
Administrative Agent may, after reasonable advance notice, hire an environmental
consultant, at the Loan Parties’ expense, to conduct such tests and
investigations; and

(iii) any observations, tests or investigations of any Project (including all
Mortgaged Property, if any, with respect thereto) by or on behalf of
Administrative Agent shall be solely for the purpose of protecting the Lenders’
security interests and rights under the Loan Documents. The exercise of
Administrative Agent’s rights under this subsection (d) shall not constitute a
waiver of any default of any Loan Party or impose any liability on
Administrative Agent or any of the Lenders. In no event will any observation,
test or investigation by or on behalf of Administrative Agent be a
representation that Hazardous Materials are or are not present in, on or under
any Project (including all Mortgaged Property, if any, with respect thereto), or
that there has been or will be compliance with any Environmental Law and
Administrative Agent shall not be deemed to have made any representation or
warranty to any party regarding the truth, accuracy or completeness of any
report or findings with regard thereto. Neither any Loan Party nor any other
party is entitled to rely on any observation, test or investigation by or on
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Agent and the Lenders owe no duty of care to protect any Loan Party or any other
party against, or to inform any Loan Party or any other party of, any Hazardous
Materials or any other adverse condition affecting any Project (including all
Mortgaged Property, if any, with respect thereto). Administrative Agent may, in
its sole discretion, disclose to the applicable Loan Party, or to any other
party if so required by law, any report or findings made as a result of, or in
connection with, its observations, tests or investigations. Each Loan Party
acknowledges that it may be obligated to notify relevant Governmental
Authorities regarding the results of any observation, test or investigation
disclosed to such Loan Party, and that such reporting requirements are site and
fact-specific and are to be evaluated by such Loan Party without advice or
assistance from Administrative Agent.

SECTION 5.12. Further Assurances. Execute any and all further documents,
financing statements, agreements and instruments, and take all further action
(including filing Uniform Commercial Code and other financing statements,
mortgages and deeds of trust) that may be required under applicable law in the
United States, or that the Required Lenders, the Administrative Agent or the
Collateral Trustee may reasonably request, in order to effectuate the
transactions contemplated by the Loan Documents and in order to grant, preserve,
protect and perfect under the laws of the United States the validity and
priority of the security interests created or intended to be created by the
Security Documents. The Borrower will cause any subsequently acquired or
organized Material Subsidiary (or any existing Material Subsidiary to the extent
not subject to (x) the restrictions on granting security interests of the type
described in the definition of Excluded Assets or (y) contractual or legal
restrictions under applicable law which at such time would be contravened by its
becoming a Loan Party pursuant to the Guarantee and Collateral Agreement) to
become a Loan Party by executing the Guarantee and Collateral Agreement and each
applicable Security Document in favor of the Collateral Trustee. In addition,
from time to time, the Borrower will, at its cost and expense, promptly secure
the Obligations by pledging or creating, or causing to be pledged or created,
perfected security interests with respect to such of the Loan Parties’ assets
and properties as the Administrative Agent or the Required Lenders shall
reasonably request (it being understood that it is the intent of the parties
that the Obligations shall be secured by substantially all the assets of the
Borrower and the Subsidiary Guarantors (including real and other properties
purchased or otherwise acquired subsequent to the Closing Date, but subject to
the exclusions in the last sentence of this Section 5.12)). Such security
interests and Liens will be created under the Security Documents and other
security agreements, mortgages, deeds of trust and other instruments and
documents reasonably satisfactory to the Collateral Trustee, and the Borrower
shall deliver or cause to be delivered to the Lenders all such customary
instruments and documents (including legal opinions, title insurance policies,
surveys, flood certificates, and Lien searches) as the Collateral Trustee shall
reasonably request in connection with the execution of any Security Documents
(and consistent with the requirements with respect to such Security Documents)
to evidence compliance with this Section; it being understood that instruments
and documents of the type delivered in connection with the initial Mortgaged
Properties shall also be delivered in connection with Mortgaged Properties
designated pursuant to this Section. The Borrower agrees to provide such
evidence as the Collateral Trustee shall reasonably request as to the perfection
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security interest and Lien. Notwithstanding the foregoing, this Section 5.12
shall not apply to (and the applicable Loan Parties shall not be required to
grant security interests in or provide Liens on or provide any of the related
documents set forth herein with respect to) (x) any owned real property
(inclusive of any Project thereon) the value (determined in good faith by the
Borrower) of which is equal to or less than $25,000,000 and any other real
property interest that is not owned or (y) any Excluded Assets, and the Loan
Parties shall not be required to take any action with respect to any thereof.

SECTION 5.13. Interest Rate Protection. No later than the 120th day after the
Closing Date, the Borrower shall enter into, and for a minimum of 2 years
thereafter maintain, Interest Rate/Currency Hedging Agreements acceptable to the
Administrative Agent that result in at least 50% of the aggregate principal
amount of the Term Loans being effectively subject to a fixed or maximum
interest rate reasonably acceptable to the Administrative Agent.

SECTION 5.14. Performance of Material Project Documents. Each Loan Party shall
perform and observe all of the terms and provisions of each Material Project
Document to be performed or observed by it, maintain each such Material Project
Document to which it is a party in full force and effect, and enforce such
Material Project Document in accordance with its material terms, except to the
extent such failure would not reasonably be expected to cause a Material Adverse
Effect, or to the extent a Replacement Project Document is entered into by the
Borrower or any other Loan Party in replacement of such Material Project
Document within a reasonable period of time (as reasonably determined by the
Administrative Agent) following such party’s failure to perform or observe any
such material term, covenant or agreement.

SECTION 5.15. Separateness. Each of Intermediate Holdings and the Borrower
acknowledges that the Agents and the Lenders are entering into this Agreement
and the other Loan Documents in reliance upon the identity of each of
Intermediate Holdings, the Borrower and its Subsidiaries, as legal entities that
are separate from any other Group Member. Therefore, from and after the Closing
Date, Intermediate Holdings and the Borrower shall take (and the Borrower shall
cause each of its Subsidiaries to take) all reasonable steps, to maintain their
identities as a separate legal entities, and to make it manifest to third
parties that they are entities with assets and liabilities distinct from those
of any other Group Member and any Affiliates thereof (other than Intermediate
Holdings and its subsidiaries) and that it is not just a division of any other
Group Member or of any such Affiliate. Without limiting the generality of the
foregoing and in addition to the other covenants set forth herein, each of
Intermediate Holdings and the Borrower shall (and the Borrower shall cause each
of its Subsidiaries to) conduct all of their respective activities in compliance
with, and shall not permit any non-compliance with or waiver of or any amendment
or modification of, Sections 8 or 9 of its Limited Liability Company Operating
Agreement, in each case, regardless of whether any of the Managers (as defined
in such Limited Liability Company Operating Agreement), including the
Independent Manager, have consented thereto or approved such waiver, amendment
or modification.

 

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SECTION 5.16. Subordination. At all times, to the extent applicable, the Term
Loans or obligations of the respective Loan Party under the Loan Documents will
be designated as senior debt under each agreement of Intermediate Holdings, the
Borrower or any of the Subsidiary Guarantors governing Indebtedness that is
expressly subordinated in right of payment to the prior payment in full of the
Obligations.

SECTION 5.17. Post-Closing Covenant. Deliver to the Administrative Agent:

(a) within 45 days following the Closing Date (or such longer period of time
granted by the Collateral Trustee in its sole discretion), Control Agreements
for each deposit account and each securities account of the Borrower and the
Subsidiary Guarantors other than the accounts permitted pursuant to
Section 6.16(b), (c) and (d);

(b) within 45 days following the Closing Date (or such longer period of time
granted by the Collateral Trustee in its sole discretion), a lender’s title
insurance policy, in form and substance reasonably acceptable to the Collateral
Trustee, insuring the Mortgage delivered by Havana Dock Enterprises, LLC in
favor of the Collateral Trustee;

(c) within 180 days following the Closing Date (or such longer period of time
granted by the Collateral Trustee in its sole discretion), deliver to the
Collateral Trustee surveys of the initial Mortgaged Properties (and all
improvements thereon) which are or will be (a)(i) prepared by a surveyor or
engineer licensed to perform surveys in the jurisdiction where such Mortgaged
Property is located, (ii) dated (or redated) not earlier than six months prior
to the date of delivery thereof unless there shall have occurred within six
months prior to such date of delivery any exterior construction on the site of
such Mortgaged Property or any easement, right of way or other interest in the
Mortgaged Property has been granted or become effective through operation of law
or otherwise with respect to such Mortgaged Property which, in either case, can
be depicted on a survey, in which events, as applicable, such survey shall be
dated (or redated) after the completion of such construction or if such
construction shall not have been completed as of such date of delivery, not
earlier than 20 days prior to such date of delivery, or after the grant or
effectiveness of any such easement, right of way or other interest in the
Mortgaged Property, (iii) certified by the surveyor (in a manner reasonably
acceptable to the Administrative Agent) to the Administrative Agent, the
Collateral Trustee and the title insurance company issuing the title insurance
policy in connection with such Mortgaged Property, (iv) complying in all
material respects with the minimum detail requirements of the American Land
Title Association as such requirements are in effect on the date of preparation
of such survey and to the extent obtainable indicating the flood zone
designation (with proper annotation based on federal flood insurance rate maps
or the state or local equivalent) and (v) sufficient for the title insurance
company issuing the title insurance policy in connection with such Mortgaged
Property to remove all standard survey exceptions from the title insurance
policy (or commitment) relating to such Mortgaged Property and issue the
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requested by the Collateral Trustee to the extent applicable and available in
the jurisdiction or (b) otherwise reasonably acceptable to the Collateral
Trustee;

The foregoing shall not require the obtaining of certain surveys if in the
reasonable discretion of the Administrative Agent after consultation with the
Borrower on a case by case basis, it determines that the cost of producing such
surveys shall be excessive in view of the benefits to be obtained by the Lenders
therefrom; and

(d) on the six-month anniversary of the Closing Date (provided that, at the
prior written request of the Borrower, such six month period shall be
automatically extended by two additional extensions of no more than three months
each) (or if such day is not a Business Day, the Business Day next following), a
certificate of a Responsible Officer of the Borrower certifying that:

(i) as of the date of such certificate, no less than 80% of the notional value
as of the Closing Date of all Hedging Obligations in respect of Commodity
Hedging Agreements between Affiliates of the Borrower (other than Intermediate
Holdings and its subsidiaries) and each counterparty thereto that have
corresponding back-to-back Hedging Obligations between such Affiliate and the
Borrower or its Subsidiaries (as extended) shall have either expired,
terminated, been novated from such Affiliate to, or otherwise reside with, the
Borrower or a Subsidiary since the Closing Date; and

(ii) from and after the date of such certificate no more than 20% of the fair
market value (determined initially as of a date within 10 days of delivery of
such certificate and determined in all cases in good faith by the Borrower using
commercially reasonable procedures and, for the avoidance of doubt, taking into
consideration in such determination the notional volumes and values (whether
physical or financial) and giving effect to the tenor thereof and the scheduled
dates for delivery thereof) of Hedging Obligations for the direct or indirect
respective benefits of the Borrower and its Subsidiaries shall be set forth
under Commodity Hedging Agreements between one or more Affiliates of the
Borrower that are not the Borrower or its Subsidiaries.

All conditions precedent and representations contained in this Agreement and the
other Loan Documents shall be deemed modified to the extent necessary to effect
the foregoing (and to permit the taking of the actions described above within
the time periods required above, rather than as elsewhere provided in the Loan
Documents), provided that (x) to the extent any representation and warranty
would not be true because the foregoing actions were not taken on the Closing
Date, the respective representation and warranty shall be required to be true
and correct in all material respects at the time the respective action is taken
(or was required to be taken) in accordance with the foregoing provisions of
this Section 5.17 and (y) all representations and warranties relating to the
Security Documents shall be required to be true immediately after the actions
required to be taken by Section 5.17 have been taken (or were required to be
taken).

 

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SECTION 5.18. Unused Collateral Postings Account. (a) The Borrower shall, within
30 days of the Closing Date, establish a segregated account (the “Collateral
Posting Account”), subject to a Control Agreement (or with the Collateral
Trustee in accordance with the Security Documents), into which the Borrower
shall deposit, and/or cause Subsidiary Guarantors to deposit that portion of the
Collateral Posting Amount that is not at any time pledged or deposited as
collateral. Amounts may be withdrawn from such account by the Borrower or any
Subsidiary Guarantor solely for the purposes of (i) pledging or depositing
Commodity Collateral Amounts, (ii) repaying the Term Loans in accordance with
Section 2.13(f), (iii) to the extent any portion of the Collateral Posting
Amount consists of Indebtedness incurred pursuant to Section 6.01(h) (such
amount, “Borrowed Postings”), repaying the Indebtedness incurred pursuant to
Section 6.01(h) in an amount not to exceed the amount of Borrowed Postings and
(iv) in the event the amount on deposit in the Collateral Posting Account
exceeds the remainder of (x) the Collateral Posting Amount less (y) amounts then
pledged or deposited as Commodity Collateral Amounts, withdrawing any amount up
to such excess.

(b) The Borrower shall calculate the amount required hereunder to be on deposit
in the Collateral Posting Account at least monthly.

(c) Any deposits withdrawn from the Collateral Posting Account as permitted by
Section 5.18(a) that are returned or refunded to the Borrower or any Subsidiary
shall be redeposited into the Collateral Posting Account unless the amount on
deposit in the Collateral Posting Account equals or exceeds the Collateral
Posting Amount less amounts then pledged or deposited as Commodity Collateral
Amounts.

ARTICLE VI

Negative Covenants

Each of Intermediate Holdings and the Borrower covenants and agrees with each
Lender that, so long as this Agreement shall remain in effect until the
principal of and interest on each Term Loan and all Administrative Agent Fees
and all other expenses or amounts payable under any Loan Document have been paid
in full, unless the Required Lenders or the Supermajority Lenders, as
applicable, shall otherwise consent in writing, neither Intermediate Holdings
nor the Borrower will, nor will they cause or permit any of the Subsidiaries to:

SECTION 6.01. Indebtedness. Incur, create, assume or permit to exist any
Indebtedness, except:

(a) Indebtedness existing on the date hereof and set forth in Schedule 6.01;

(b) Indebtedness created hereunder and under the other Loan Documents;

(c) intercompany Indebtedness of the Borrower and the Subsidiaries to the extent
permitted by Section 6.04(c);

 

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(d) Indebtedness of the Borrower or any Subsidiary incurred to finance the
acquisition, construction or improvement of any fixed or capital assets or
equipment of the Borrower or its Subsidiaries, and extensions, renewals and
replacements of any such Indebtedness that do not increase the outstanding
principal amount thereof; provided that (i) such Indebtedness is incurred prior
to or within 180 days after such acquisition or the completion of such
construction or improvement and (ii) the aggregate principal amount of
Indebtedness permitted by this Section 6.01(d) shall not exceed $50,000,000 at
any time outstanding; provided further that that the aggregate principal amount
of Indebtedness permitted by this Section 6.01(d), when combined with the
aggregate principal amount of all Indebtedness incurred pursuant to
Sections 6.01(e), (h), (i) and (q), shall not exceed $200,000,000 at any time
outstanding;

(e) Capital Lease Obligations in an aggregate principal amount not in excess of
$50,000,000 at any time outstanding; provided that that the aggregate principal
amount of Indebtedness permitted by this Section 6.01(e), when combined with the
aggregate principal amount of all Indebtedness incurred pursuant to
Sections 6.01(d), (h), (i) and (q), shall not exceed $200,000,000 at any time
outstanding;

(f) Indebtedness under performance bonds, surety bonds, appeal bonds, custom
bonds or similar bonds and obligations or with respect to workers’ compensation
claims or insurance premium financing (to the extent not for borrowed money), in
each case incurred in the ordinary course of business or in connection with the
enforcement of rights or claims of any Loan Party in connection with judgments
that do not result in an Event of Default;

(g) Indebtedness in respect of Commodity Hedging Obligations, Eligible Commodity
Hedging Obligations and Interest Rate/Currency Hedging Obligations of the
Borrower and the Subsidiaries;

(h) Indebtedness of the Loan Parties under one or more pari passu revolving
credit facilities in an aggregate principal amount that, when combined with the
aggregate principal amount of all Indebtedness incurred under a pari passu
secured letter of credit facility pursuant to Section 6.01(i), shall not exceed
$200,000,000 at any time outstanding; provided, that such pari passu revolving
credit facility shall not have negative covenants that are more restrictive in
any material respect than the negative covenants set forth in this Agreement
(provided, however, that such pari passu revolving credit facility may contain
one or more financial covenants); provided further that that the aggregate
principal amount of Indebtedness permitted by this Section 6.01(h), when
combined with the aggregate principal amount of all Indebtedness incurred
pursuant to Sections 6.01(d), (e), (i) and (q), shall not exceed $200,000,000 at
any time outstanding;

(i) Indebtedness of the Loan Parties under one or more pari passu letter of
credit facilities in an aggregate principal amount that, when combined with the
aggregate principal amount of all Indebtedness incurred under a pari passu

 

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revolving credit facility pursuant to Section 6.01(h) shall not exceed
$200,000,000 at any time outstanding; provided that that the aggregate principal
amount of Indebtedness permitted by this Section 6.01(i), when combined with the
aggregate principal amount of all Indebtedness incurred pursuant to
Sections 6.01(d), (e), (h) and (q), shall not exceed $200,000,000 at any time
outstanding;

(j) Indebtedness arising from obligations of the Borrower or any Subsidiary to
pay the deferred purchase price of goods or services, or progress payments in
connection with such goods and services, including turbines, transformers and
similar equipment, so long as such obligations are incurred in the ordinary
course of business;

(k) Indebtedness in respect of (i) letters of credit or bank guaranties
(including reimbursement obligations with respect thereto) secured by cash and
Permitted Investments or are unsecured and incurred in the ordinary course of
business and, for the avoidance of doubt, not supporting Indebtedness for
borrowed money, and (ii) surety bonds issued in the ordinary course of business;

(l) the incurrence by the Borrower or Subsidiary of Indebtedness consisting of
(i) financing of insurance premiums or (ii) take-or-pay obligations contained in
supply agreements, in each case arising in the ordinary course of business and
not in connection with the borrowing of money and not in connection with any
Hedging Obligations;

(m) indebtedness in respect of netting services, overdraft protection and
otherwise in connection with deposit accounts in the ordinary course of
business;

(n) Indebtedness arising from agreements for indemnification, adjustment of
purchase price or similar obligations, in each case incurred in connection with
the disposition of any business or assets of the Borrower or any Subsidiary
permitted hereunder; provided that the maximum aggregate liability in respect of
all such Indebtedness shall at no time exceed the gross proceeds actually
received by the applicable Person in connection with such disposition;

(o) any Guarantee of Indebtedness, which Indebtedness is otherwise permitted
pursuant to this Section 6.01;

(p) any extensions, renewals or replacements of Indebtedness permitted in the
foregoing clauses (a) and this clause (p) to the extent the principal amount of
such Indebtedness is not increased, neither the final maturity nor the weighted
average life to maturity of such Indebtedness is decreased, such Indebtedness,
if subordinated to the Obligations, remains so subordinated on terms no less
favorable to the Lenders, and the original obligors in respect of such
Indebtedness remain the only obligors thereon;

(q) other secured or unsecured Indebtedness of the Borrower or the Subsidiaries
in an aggregate principal amount not exceeding $25,000,000 at any time
outstanding; provided that that the aggregate principal amount of Indebtedness

 

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permitted by this Section 6.01(q), when combined with the aggregate principal
amount of all Indebtedness incurred pursuant to Sections 6.01(d), (e), (h) and
(i), shall not exceed $200,000,000 at any time outstanding; and

(r) Indebtedness in respect of Material Project Documents.

SECTION 6.02. Liens. Create, incur, assume or permit to exist any Lien on any
property or assets (including Equity Interests or other securities of any
Person, including the Borrower or any Subsidiary) now owned or hereafter
acquired by it or on any income or revenues or rights in respect of any thereof,
except:

(a) Liens on property or assets of the Borrower and its Subsidiaries existing on
the date hereof and set forth in Schedule 6.02; provided that such Liens shall
secure only those obligations which they secure on the date hereof;

(b) any Lien created under the Loan Documents;

(c) Liens for taxes, assessments or other governmental charges or levies not yet
due or which are being contested in compliance with Section 5.03;

(d) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s, vendor’s
or other like Liens arising in the ordinary course of business and securing
obligations that are not delinquent or which are being contested in compliance
with Section 5.03;

(e) Liens incurred in the ordinary course of business in compliance with
workmen’s compensation, unemployment insurance and other social security laws or
regulations;

(f) Liens or deposits incurred to secure the performance of bids, trade
contracts (other than for Indebtedness), leases (other than Capital Lease
Obligations), statutory obligations, surety and appeal bonds, insurance,
performance bonds and other obligations of a like nature incurred in the
ordinary course of business;

(g) zoning restrictions, easements, licenses, rights-of-way, provisions,
covenants, minor irregularities of title (and with respect to leasehold
interests, mortgages, obligations, Liens and other encumbrances incurred,
created, assumed or permitted to exist and arising by, through or under a
landlord, ground lessor or owner of the leased property, with or without consent
of the lessee) restrictions on use of real property and other similar
encumbrances incurred in the ordinary course of business which, in the
aggregate, do not materially detract from the value of the property subject
thereto or interfere with the ordinary conduct of the business of the Borrower
or any of its Subsidiaries;

(h) purchase money security interests in real property, improvements thereto or
fixed or capital assets or equipment hereafter acquired (or, in the case of
improvements, constructed) by the Borrower or any Subsidiary; provided that

 

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(i) such security interests secure Indebtedness permitted by Section 6.01,
(ii) such security interests are incurred, and the Indebtedness secured thereby
is created, within 180 days after such acquisition (or construction) and
(iii) such security interests do not apply to any other property or assets of
the Borrower or any Subsidiary;

(i) judgment Liens securing judgments, decrees or orders of any court not
constituting an Event of Default under Article VII;

(j) Liens arising under any obligations or duties affecting any of the property
of any Person to any municipality or public authority with respect to any
franchise, grant, license or permit which do not materially impair the use of
such property for the purposes for which it is held;

(k) Liens securing Eligible Commodity Hedging Agreements, Specified Hedging
Agreements of the Loan Parties or Treasury Services Agreements of the Loan
Parties that are pari passu with the Liens securing the Obligations so long as
the Acceptable Commodity Counterparty or Acceptable Financial Counterparty party
thereto joins the Intercreditor Agreement pursuant to the terms thereof or in a
manner reasonably satisfactory to the Administrative Agent and the Collateral
Trustee and such Lien is granted in compliance with the terms and provisions of
the Intercreditor Agreement, including Section 5.6 of the Intercreditor
Agreement;

(l) Liens securing the pari passu (i) revolving credit facility permitted
pursuant to Section 6.01(h) or (ii) letter of credit facility permitted pursuant
to Section 6.01(i), in each case, that are pari passu with the Liens securing
the Obligations so long as any secured party thereunder joins the Intercreditor
Agreement pursuant to the terms thereof or in a manner reasonably satisfactory
to the Administrative Agent and such Lien is granted in compliance with the
terms and provisions of the Intercreditor Agreement, including Section 5.5 of
the Intercreditor Agreement;

(m) Liens granted by the Borrower or any of its Subsidiaries on its or their
rights under any insurance policy, but only to the extent that such Lien is
granted to the insurers under such insurance policies or any insurance premium
finance company to secure payment of the premiums and other amounts owed to the
insurers or such premium finance company with respect to such insurance policy;

(n) Liens (i) securing reimbursement obligations with respect to letters of
credit that encumber documents and other property relating to such letters of
credit and the proceeds and products thereof or (ii) on deposits and Permitted
Investments securing reimbursement obligations with respect to any Cash
Collateralized Letter of Credit and Reimbursement Agreement;

(o) Liens on cash deposits in the nature of a right of setoff, banker’s lien,
counterclaim or netting of cash amounts owed arising in the ordinary course of
business on deposit accounts;

 

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(p) Liens in respect of “true leases”, and not in respect of Indebtedness,
arising from Uniform Commercial Code financing statements filed for information
purposes with respect to leases incurred in the ordinary course of business and
not otherwise prohibited by this Agreement;

(q) inchoate statutory Liens arising under ERISA;

(r) Liens on cash and short-term investments deposited by the Borrower or any of
its Subsidiaries with or on behalf of brokers, credit clearing organizations,
independent system operators, regional transmission organizations, pipelines,
state agencies, federal agencies, futures contract brokers, customers, trading
counterparties, or any other parties or pledged by the Borrower or any of its
Subsidiaries to secure its obligations and/or the obligations of any Subsidiary
and/or the Borrower with respect to: (i) any contracts and transactions for the
purchase, sale, exchange of, or the option (whether physical or financial) to
purchase, sell or exchange (a) natural gas, (b) electricity, (c) coal,
(d) petroleum-based liquids, (e) oil, (f) emissions, (g) waste byproducts,
(h) weather or (i) any other energy-related commodity or derivative; (ii) any
contracts or transactions for the processing, transmission, transportation, or
storage of, or any other services related to any commodity identified in
subparts (a) - (i) above, including any capacity agreement; (iii) any financial
derivative agreement (including but not limited to swaps, options or swaptions)
related to any commodity identified in subparts (a) - (i) above, or to any
interest rate or currency rate management activities; (iv) any agreement for
membership or participation in an organization that facilitates or permits the
entering into or clearing of any agreement described in this Section 6.02(r),
including Netting Agreements in respect thereof; (v) any agreement combining
part or all of any of the agreements described in this Section 6.02(r) including
Netting Agreements in respect thereof; (vi) any document relating to any
agreement described in this Section 6.02(r) that is filed with a governmental
body and any related service agreements; or (vii) any commercial or trading
agreements, each with respect to, or involving the purchase, transmission,
distribution, sale, lease or hedge of, any energy, generation capacity or fuel,
or any other energy related commodity or service, price or price indices for any
such commodities or services or any other similar derivative agreements, and any
other similar agreements (such agreements, including Netting Agreements in
respect thereof, described in clauses (i) through (vii) of this Section 6.02(r)
being collectively, “Permitted Contracts”), and letters of credit supporting
Permitted Contracts (including any reimbursement obligations with respect to
such letters of credit);

(s) Liens granted by the Borrower or any of its Subsidiaries to a counterparty
and/or to Affiliates of such counterparty (each, a “Permitted Contracts
Counterparty”) on accounts receivable and other obligations owed to, and other
rights of the Borrower or any of its Subsidiaries under, Permitted Contracts to
secure the Borrower’s or such Subsidiary’s obligations under such Permitted
Contract, and any netting, setoff or similar rights granted by the

 

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Borrower or any of its Subsidiaries to a Permitted Contracts Counterparty
pursuant to a Permitted Contract;

(t) extensions, renewals or replacements of any of the Liens permitted in
clauses (a) and (h) so long as (i) the principal amount of the Indebtedness or
obligation secured thereby is no greater than the principal amount of such
Indebtedness or obligation at the time such Lien was permitted hereunder except
for increases in an amount equal to a reasonable premium or other reasonable
amount paid, and fees and expenses reasonably incurred, in connection with such
extension, renewal, refinancing, or replacement and in an amount equal to any
existing commitments unutilized thereunder, (ii) any such extension, renewal or
replacement Lien is limited to the property originally encumbered thereby, and
(iii) any renewal or extension of the Indebtedness or obligations secured or
benefited thereby is permitted by Section 6.01;

(u) Liens with respect to the Mortgaged Properties that are exceptions as set
forth in the title insurance policies (or commitments) issued in connection with
the Mortgages, all of which exceptions must be acceptable to the Collateral
Trustee in its reasonable discretion;

(v) Any interest or title of a lessor or sublessor under any lease entered into
by the Borrower or any Subsidiary in the ordinary course of business and
covering only the assets so leased;

(w) Statutory and common law landlords’ liens under leases to which the Borrower
or any Subsidiary is a party;

(x) any Lien existing on any property or asset prior to the acquisition thereof
by the Borrower or any Subsidiary or existing on any property or assets of any
Person that becomes a Subsidiary after the date hereof prior to the time such
Person becomes a Subsidiary, as the case may be; provided that (i) such Lien is
not created in contemplation of or in connection with such acquisition or such
Person becoming a Subsidiary, (ii) such Lien does not apply to any other
property or assets of Intermediate Holdings, the Borrower or any Subsidiary,
(iii) such Lien secures only those obligations which it secures on the date of
such acquisition or the date such Person becomes a Subsidiary, as the case may
be, and (iv) the amount of such Indebtedness and other obligations shall not be
permitted to be increased under this clause (x) other than, in the case of
obligations other than such Indebtedness, as a result of changes in the
underlying market prices and rates relevant to such obligations and otherwise by
operation of the terms of such obligations;

(y) pledges and deposits made in connection with Material Project Documents; and

(z) other Liens securing liabilities hereunder in an aggregate amount not to
exceed $25,000,000 at any time outstanding.

 

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SECTION 6.03. Sale and Lease-Back Transactions. Enter into any arrangement,
directly or indirectly, with any Person whereby it shall sell or transfer any
property, real or personal, used or useful in its business, whether now owned or
hereafter acquired, and thereafter rent or lease such property or other property
which it intends to use for substantially the same purpose or purposes as the
property being sold or transferred unless (a) the sale or transfer of such
property is permitted by Section 6.05(b) and (b) any Capital Lease Obligations
or Liens arising in connection therewith are permitted by Sections 6.01 and
6.02, as the case may be.

SECTION 6.04. Investments, Loans and Advances. Purchase, hold or acquire any
Equity Interests, evidences of indebtedness or other securities of, make or
permit to exist any loans or advances to, or make or permit to exist any
investment or any other interest in, any other Person, except:

(a) (i) investments by Intermediate Holdings, the Borrower and the Subsidiaries
existing on the date hereof, (ii) investments by Intermediate Holdings, the
Borrower and the Subsidiaries in the Equity Interests of the Borrower and the
Subsidiaries and (iii) additional investments by Intermediate Holdings, the
Borrower and the Subsidiaries in the Equity Interests of the Borrower and the
Subsidiaries; provided that (A) any such Equity Interests held by a Loan Party
shall be pledged, to the extent required by, and pursuant to this Agreement, the
Guarantee and Collateral Agreement and the Pledge Agreement and (B) the
aggregate amount of investments made after the Closing Date by Loan Parties in,
and loans and advances made after the Closing Date by Loan Parties to,
Subsidiaries that are not Loan Parties (determined without regard to any
write-downs or write-offs of such investments, loans and advances) shall not
exceed, when combined with the Equity Interests in Subsidiaries that may be
sold, transferred, leased or disposed of pursuant to 6.05(a), $10,000,000 at any
time outstanding;

(b) Permitted Investments;

(c) loans or advances made by the Borrower to any Subsidiary and made by any
Subsidiary to the Borrower or any other Subsidiary; provided that (i) any such
loans and advances made by a Loan Party to a Subsidiary that is not a Loan Party
shall be pledged to the Collateral Trustee for the ratable benefit of the
Secured Parties pursuant to (and with any promissory note evidencing the same
delivered to the Collateral Trustee to the extent required by) the Guarantee and
Collateral Agreement, (ii) such loans and advances shall be unsecured and
subordinated to the Obligations pursuant to an Affiliate Subordination Agreement
and (iii) the amount of such loans and advances made by Loan Parties to
Subsidiaries that are not Loan Parties shall be subject to the limitation set
forth in clause (a) above;

(d) any investments received (i) in compromise or resolution of obligations of
trade creditors or customers that were incurred in the ordinary course of
business of the Borrower or any of its Subsidiaries, including (A) obligations
of

 

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financially troubled account debtors to the extent reasonably necessary in order
to prevent or limit loss and (B) pursuant to any plan of reorganization or
similar arrangement upon the bankruptcy or insolvency of any trade creditor or
customer, (ii) in compromise or resolution of litigation, arbitration or other
disputes or (iii) on account of any claim against, or an interest in, any other
Person (A) acquired in good faith in connection with or as a result of a
bankruptcy, workout, reorganization or recapitalization of such other Person or
(B) as a result of a bona fide foreclosure by the Borrower or any of its
Subsidiaries with respect to any claim against any other Person;

(e) any investment consisting of extensions of credit including, without
limitation, accounts receivables or notes receivables arising from the grant of
trade credit or prepayments or similar transactions, if created or acquired in
the ordinary course of business;

(f) investments in Hedging Obligations to the extent not prohibited by
Section 6.01;

(g) investments (i) by the Borrower or Subsidiary Guarantors resulting from the
drawings under, or renewals or extensions of, letters of credit, surety bonds,
guarantees, or performance bonds supporting obligations of the Borrower or such
Subsidiary Guarantors, and investments in the Borrower or the Subsidiary
Guarantors to cash collateralize obligations supported by such letters of
credit, bonds or guarantees if they expire or are cancelled undrawn to be made
by the Borrower or any of the Subsidiary Guarantors in order to avoid a default
pursuant to contracts or agreements entered into in the ordinary course of
business and (ii) by Subsidiaries of the Borrower that are not Loan Parties
resulting from the drawings under, or renewals or extensions of, letters of
credit, surety bonds, guarantees, or performance bonds supporting obligations of
such non-Loan Party Subsidiaries, and investments by Subsidiaries of the
Borrower that are not Loan Parties in such non-Loan Party Subsidiaries to cash
collateralize obligations supported by such letters of credit, bonds or
guarantees if they expire or are cancelled undrawn to be made by such non-Loan
Party Subsidiaries in order to avoid a default pursuant to contracts or
agreements entered into in the ordinary course of business;

(h) any investment existing on the Closing Date in any Person in which the
Borrower or any Subsidiary owns capital stock (each such Person, a “Minority
Investment”); provided that no increase of any such investment shall be
permitted under this clause (h) (it being understood that the acquisition of a
Subsidiary, Minority Investment or any other investment in connection with and
as part of purchase of capital stock or of any asset that does not become
Collateral shall be deemed to be an investment made in reliance on a provision
of this Section 6.04 other than this clause (h));

(i) to the extent not prohibited by Law, loans and advances to officers,
directors, and employees of Intermediate Holdings, the Borrower and/or any of
the

 

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Subsidiaries in an aggregate amount not to exceed $500,000 at any time
outstanding made in the ordinary course of business;

(j) investments paid for solely with Equity Interests (other than Disqualified
Stock) of Intermediate Holdings;

(k) any Loan Party may receive and hold promissory notes and other non-cash
consideration from a sale, transfer or other disposition of any asset in
compliance with Section 6.05;

(l) any Loan Party may make advances in the form of a prepayment of expenses to
vendors, suppliers and trade creditors, so long as such expenses were incurred
in the ordinary course of business and are being paid in accordance with
customary trade terms of such Loan Party;

(m) any Loan Party may acquire and hold accounts receivables owing to any of
them, if created or acquired in the ordinary course of business and payable or
dischargeable in accordance with customary trade terms of such Loan Party;

(n) any Loan Party may acquire and hold obligations of their officers and
employees in connection with such officers’ and employees’ acquisition of Equity
Interest in Intermediate Holdings (so long as no cash is actually advanced by
Intermediate Holdings or any of its subsidiaries in connection with the
acquisition of such obligations);

(o) any Guarantees permitted to be incurred pursuant to Section 6.01;

(p) any investment in Holdings to the extent the same would be permitted to be
made as a Restricted Payment pursuant to Section 6.06;

(q) [reserved];

(r) Cash Collateralized Letters of Credit issued to support Indebtedness or
other obligations of any Subsidiary Guarantor;

(s) any Loan Party may enter into transactions contemplated under the Material
Project Documents that constitute investments (including investments in
Affiliates of the Borrower as required under the Material Project Documents);

(t) additional investments, loans and advances by the Loan Parties with amounts
that would otherwise have been permitted to be used to make Restricted Payments
pursuant to Section 6.06(a)(ii), so long as the amount so invested shall reduce
the amount otherwise permitted to be used to make Restricted Payments pursuant
to said Section 6.06(a)(ii) in the fiscal year in which the respective
investment is made; provided that any returns on investments made pursuant to
this clause (t) may, at the option of the Borrower be used to make further
investments pursuant to this clause (t) or be deemed to increase the amount of
Restricted Payments permitted pursuant to said Section 6.06(a)(ii);

 

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(u) any letters of credit or other credit support issued to support the trading
activities of the Borrower and the Subsidiary Guarantors pursuant to any Energy
Management Agreement; and

(v) in addition to investments permitted by paragraphs (a) through (t) above,
additional investments, loans and advances by the Borrower and the Subsidiaries
so long as the aggregate amount invested, loaned or advanced pursuant to this
paragraph (s) (determined without regard to any write-downs or write-offs of
such investments, loans and advances) does not exceed $25,000,000 in the
aggregate at any time outstanding.

SECTION 6.05. Mergers, Consolidations, Sales of Assets and Acquisitions.
(a) Merge into or consolidate with any other Person, or permit any other Person
to merge into or consolidate with it, or sell, transfer, lease or otherwise
dispose of (in one transaction or in a series of transactions) all or
substantially all the assets (whether now owned or hereafter acquired) of the
Borrower or less than all the Equity Interests of any Subsidiary (if the Fair
Market Value of the Equity Interests so disposed of, when combined with all the
investments permitted pursuant to 6.04(a)(i)(B) and then outstanding, exceed
$10,000,000 at any time), or purchase, lease or otherwise acquire (in one
transaction or a series of transactions) all or any substantial part of the
assets of any other Person (unless permitted pursuant to Section 6.10,
constituting a contribution of assets of such Person to the Borrower or having a
Fair Market Value not in excess of $5,000,000), except that (i) the Borrower and
any Subsidiary may purchase and sell inventory and capacity energy and ancillary
services in the ordinary course of business, (ii) any Loan Party may make
investments permitted under Section 6.04 and Restricted Payments permitted under
Section 6.06, (iii) if at the time thereof and immediately after giving effect
thereto no Event of Default or Default shall have occurred and be continuing
(y) any Subsidiary may merge or dissolve into the Borrower in a transaction in
which the Borrower is the surviving entity and (z) any Subsidiary may merge or
dissolve into or consolidate with any other Subsidiary (provided that if any
party to any such transaction is a Loan Party, the surviving entity of such
transaction shall be a Loan Party), (iv) in connection with any Asset Sale
permitted under clause (b) below, any Subsidiary of the Borrower may dissolve,
liquidate, consolidate or merge with or into any other Person or permit any
other Person to merge into or consolidate with it, (v) so long as no Event of
Default exists or would result therefrom, in connection with any investment
permitted under Section 6.04, any Subsidiary may merge or dissolve into or
consolidate with any other Person or permit any other Person to merge or
dissolve into or consolidate with it; provided that the Person surviving such
merger, dissolution or consolidation shall be a Subsidiary Guarantor and
(vi) any Immaterial Subsidiary may dissolve, liquidate, wind up, consolidate or
merge with or into any other Subsidiary.

(b) Make any Asset Sale (including those otherwise permitted under paragraph (a)
above) unless (i) such Asset Sale is for consideration at least 75% of which is
cash, (ii) such consideration is at least equal to the Fair Market Value of the
assets being sold, transferred, leased or disposed of, (iii) the Fair Market
Value of all assets sold, transferred, leased or disposed of pursuant to this
paragraph (b) shall not exceed in the aggregate 15% of the value of the total
net assets of

 

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Intermediate Holdings, the Borrower and the Subsidiaries as of the Closing Date
and (iv) any Net Cash Proceeds from such Asset Sale shall be applied as required
by Section 2.13.

SECTION 6.06. Restricted Payments; Restrictive Agreements. (a) Declare or make,
or agree to declare or make, directly or indirectly, any Restricted Payment
(including pursuant to any Synthetic Purchase Agreement), or incur any
obligation (contingent or otherwise) to do so; provided, however, that

(i) (A) any Subsidiary may declare and pay dividends or make other distributions
ratably to its equity holders (taking into account the rights and preferences of
the various Equity Interests) and (B) Intermediate Holdings and the Borrower may
declare and pay dividends solely in the common Equity Interests of such Person;

(ii) so long as (A) no Event of Default or Default shall have occurred and be
continuing or would result therefrom and (B) as of the date of such proposed
distribution, all unrestricted cash and unrestricted Permitted Investments of
the Borrower and the Subsidiaries is at least $50,000,000, then Intermediate
Holdings may make, and the Borrower may make to Intermediate Holdings,
distributions in an aggregate amount not to exceed $90,000,000 in any fiscal
year; provided that the proceeds of the Indebtedness permitted to be incurred
pursuant to Section 6.01(h) shall not be used to make any such distributions;

(iii) (A) the Borrower may make Restricted Payments to Intermediate Holdings to
the extent necessary to pay general corporate and overhead expenses incurred by
Intermediate Holdings and Holdings pursuant to the Services Agreement in an
aggregate amount not to exceed $1,000,000 in any fiscal year, (B) the Borrower
may make Restricted Payments to Intermediate Holdings so that Intermediate
Holdings may, repurchase, retire or redeem its Equity Interests owned by
directors, officers or employees of Intermediate Holdings, the Borrower or any
Subsidiary or make payments to employees of Intermediate Holdings, the Borrower
or any Subsidiary upon termination of employment in connection with the exercise
of stock options, stock appreciation rights or similar equity incentives or
equity based incentives pursuant to management incentive plans or in connection
with the death or disability of such employees in an aggregate amount not to
exceed in any fiscal year an amount equal to $1,000,000 for such fiscal year,
and (C) so long as the Borrower is treated as a partnership or disregarded
entity for U.S. federal income Tax purposes or is properly treated as a member
of a group filing consolidated returns for U.S. federal income tax purposes with
its direct or indirect parent as the common parent of such group, the Borrower
and Intermediate Holdings may make Restricted Payments at times and in amounts
necessary to make all required payments pursuant to the Tax Sharing Agreement;
provided that in no event shall the amount of any such payments pursuant to the
Tax Sharing Agreement for any year (or a portion thereof) which involves an
Asset Sale by the Borrower or any of its Subsidiaries, in so far as such
payments relate to the relevant income tax with respect to such sale, exceed the
amount of

 

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U.S. federal net income tax (and, if applicable, the relevant state income tax)
that the common parent actually owes to the relevant taxing authority that is
attributable to such sale; and

(iv) the Borrower may make a Restricted Payment of up to $200,000,000 from the
proceeds of the Term Loans within five Business Days of the Closing Date and
Intermediate Holdings may make a Restricted Payment to Holdings in an identical
amount.

(b) Enter into, incur or permit to exist any agreement or other arrangement that
prohibits, restricts or imposes any condition upon (i) the ability of
Intermediate Holdings, the Borrower or any Subsidiary to create, incur or permit
to exist any Lien upon any of its property or assets, or (ii) the ability of any
Subsidiary to pay dividends or other distributions with respect to any of its
Equity Interests or to make or repay loans or advances to the Borrower or any
other Subsidiary or to Guarantee Indebtedness of the Borrower or any other
Subsidiary; provided that (A) the foregoing shall not apply to restrictions and
conditions imposed by law or by any Loan Document, (B) the foregoing shall not
apply to customary restrictions and conditions contained in agreements relating
to the sale of a Subsidiary pending such sale, provided such restrictions and
conditions apply only to the Subsidiary that is to be sold and such sale is
permitted hereunder, (C) clause (i) of the foregoing shall not apply to
restrictions or conditions imposed by any agreement relating to secured
Indebtedness permitted by this Agreement if such restrictions or conditions
apply only to the property or assets securing such Indebtedness, (D) clause (i)
of the foregoing shall not apply to customary provisions in leases, licenses or
other contracts restricting the assignment thereof, (E) clause (i) of the
forgoing shall not apply to (1) purchase money obligations that impose
restrictions of the nature described in clause (i) above on the property so
acquired; (2) customary provisions limiting the disposition or distribution of
assets or property in partnership, joint venture, asset sale agreements, stock
sale agreements and other similar agreements entered into in the ordinary course
of business, which limitation is applicable only to the assets that are the
subject of such agreements; and (3) restrictions on cash or other deposits or
net worth imposed by customers under contracts entered into in the ordinary
course of business, (F) the foregoing shall not apply to restrictions on the
transfer of assets pursuant to executory contracts for the sale, lease or other
transfer thereof to the extent such sale, lease or other transfer is otherwise
permitted under this Agreement; (G) clause (i) of the foregoing shall not apply
to restrictions or conditions imposed by any agreement so long as such
restrictions and conditions are with respect to property or assets that do not
constitute Collateral, (H) this clause (b) shall not apply to restrictions or
conditions as in effect on the Closing Date, as same may be amended or modified
from time to time, or contained in any Indebtedness which refinances
Indebtedness subject to such restrictions, in each case so long as the
respective restrictions are not made materially more restrictive and (I) the
foregoing shall not apply to restrictions and conditions imposed on Intermediate
Holdings, the Borrower or any Subsidiary by the terms of any Indebtedness of
Intermediate Holdings, the Borrower or any Subsidiary permitted to be incurred
hereunder, so long as the restrictions and

 

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conditions are customary and not materially less favorable, taken as a whole, to
the Lenders than such encumbrances or restrictions hereunder.

SECTION 6.07. Transactions with Affiliates. Except for transactions between or
among Loan Parties, sell or transfer any property or assets to, or purchase or
acquire any property or assets from, or otherwise engage in any other
transactions with, any of its Affiliates, except that (a) Intermediate Holdings,
the Borrower or any Subsidiary Guarantor (i) may engage in any of the foregoing
transactions in the ordinary course of business at prices and on terms and
conditions not less favorable to Intermediate Holdings, the Borrower or such
Subsidiary Guarantor (as reasonably determined by Intermediate Holdings, the
Borrower or such Subsidiary Guarantor, as the case may be) than could be
obtained on an arm’s-length basis from unrelated third parties, (ii) may engage
in any of the transactions contemplated by the Reorganization, the
Reorganization Documents and the Material Project Documents, (iii) may engage in
transactions solely between or amongst one or more Loan Parties, (iv) make the
Restricted Payments permitted under Section 6.06, (v) may make investments
permitted by Section 6.04, (vi) may make, in the case of the Borrower and
Intermediate Holdings, payments, perform services and engage in other
transactions pursuant to the Material Project Documents and the Tax Sharing
Agreement and (vii) may engage in any non-ordinary course transactions that are
(x) on terms and conditions not less favorable to Intermediate Holdings, the
Borrower or such Subsidiary Guarantor (as reasonably determined by the Borrower)
than could be obtained on an arm’s-length basis from unrelated third parties and
(y) of a Fair Market Value less than $10,000,000 and (b) any Subsidiary of the
Borrower that is not a Loan Party (i) may engage in any of the foregoing
transactions in the ordinary course of business at prices and on terms and
conditions not less favorable to such non-Loan Party Subsidiary (as reasonably
determined by such non-Loan Party Subsidiary) than could be obtained on an
arm’s-length basis from unrelated third parties, (ii) may engage in any of the
transactions contemplated by the Reorganization, the Reorganization Documents
and the Material Project Documents and (iii) may engage in transactions between
one or more Subsidiaries that are not Loan Parties.

SECTION 6.08. Business of Borrower and Subsidiaries. With respect to the
Borrower and its Subsidiaries, engage at any time in any business or business
activity other than the business currently conducted by it and business
activities reasonably incidental thereto.

SECTION 6.09. Other Indebtedness and Agreements. (a) Permit (i) any waiver,
supplement, modification or amendment of its certificate of incorporation,
by-laws, operating, management or partnership agreement or other organizational
documents, to the extent any such waiver, supplement, modification or amendment
would be adverse to the Lenders in any material respect or (ii) amend any of the
Independent Manager or separateness provisions set forth in Sections 6, 8, 9, 20
or 21 of each of the Limited Liability Company Operating Agreement as such
separateness provisions relate to Independent Approval Matters (as defined in
each Limited Liability Company Operating Agreement); provided, that technical
amendments to such provisions shall be permitted solely to permit the admission
of additional Members (as defined in such

 

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Limited Liability Company Operating Agreements) in connection with any sale of
Intermediate Holdings’ Equity Interests as permitted pursuant to the Loan
Documents.

(b) [Reserved].

(c) Except to the extent any of the following actions, either individually or in
the aggregate, could not reasonably be expected to cause a Material Adverse
Effect (taken as a whole after giving effect to all applicable amendments,
modifications, changes, consents, waivers and approvals and after giving effect
to any Replacement Project Document), neither the Borrower nor any other Loan
Party will cancel or terminate any Material Project Documents or consent to or
accept any cancellation or termination thereof, or amend, modify or change any
term or condition of any Material Project Document or give any consent, waiver
or approval thereunder, waive any default under or any breach of any term or
condition of any Material Project Document or cause or allow the assignment of
the rights or obligations of any Loan Party to any Material Project Document
other than pursuant to the Loan Documents.

SECTION 6.10. Capital Expenditures.

(a) Subject to following the clauses (b) through (e), permit the aggregate
amount of Capital Expenditures made by the Borrower and the Subsidiaries in any
period set forth on Schedule 6.10(a) to exceed the amount set forth on Schedule
6.10(a) for such period.

(b) The amount of permitted Capital Expenditures set forth on Schedule 6.10(a)
in respect of any fiscal year commencing with the fiscal year ending on
December 31, 2012, shall be increased (but not decreased) by the amount of
unused permitted Capital Expenditures for the immediately preceding fiscal year
(after utilization of any carry-forward into such fiscal year); provided that
the amount of such carry-forward shall not exceed the amount of Capital
Expenditures set forth on Schedule 6.10(a) for such preceding fiscal year.

(c) In addition to the foregoing, in the event the amount of Capital
Expenditures made by the Borrower and its Subsidiaries in any fiscal year
exceeds (or is expected to exceed) the amount that would be permitted above,
Borrower may elect by written notice to the Administrative Agent to increase the
amount so permitted by an amount up to the Capital Expenditures permitted under
clause (a) above for the immediately succeeding fiscal year (such amount so
elected by the Borrower being the “CapEx Pullback Amount”). The actual amount of
the CapEx Pullback Amount expended by Borrower and its Subsidiaries in such
fiscal year shall reduce, on a dollar for dollar basis, the amount of Capital
Expenditures permitted above for the immediately succeeding fiscal year.

(d) In addition to the foregoing, the Borrower and its Subsidiaries may make
Capital Expenditures required by any legislation or regulation identified on

 

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Schedule 6.10(d) that becomes any Environmental Law up to an aggregate amount
not to exceed $50,000,000.

(e) In addition to the foregoing, the Borrower and its Subsidiaries may make
Capital Expenditures from any Net Cash Proceeds of issuances of Equity Interests
of the Borrower made during any fiscal year.

SECTION 6.11. Fiscal Year. With respect to Intermediate Holdings and the
Borrower, change their fiscal year-end to a date other than December 31.

SECTION 6.12. Certain Equity Securities. Issue any Equity Interest that is not
Qualified Capital Stock unless treated as Indebtedness for purposes of
Section 6.01 and incurred in compliance therewith.

SECTION 6.13. Permitted Activities of Intermediate Holdings. Solely in the case
of Intermediate Holdings, (a) incur, directly or indirectly, any Indebtedness or
any other obligation or liability whatsoever other than the Indebtedness and
obligations under this Agreement and the other Loan Documents, (b) create or
suffer to exist any Lien upon any property or assets now owned or hereafter
acquired, leased or licensed by it other than the Liens created under the
Security Documents to which it is a party, (c) engage in any business or
activity or own any assets other than (i) holding 100% of the Equity Interests
of the Borrower, (ii) performing its obligations and activities incidental
thereto under the Loan Documents, the Material Project Documents and the Tax
Sharing Agreement and (iii) making Restricted Payments, payments, redemptions,
repurchases or retirings of Indebtedness and investments to the extent permitted
by this Agreement, (d) consolidate with or merge with or into, or convey,
transfer, lease or license all or substantially all its assets to, any Person or
(e) fail to hold itself out to the public as a legal entity separate and
distinct from all other Persons (other than its subsidiaries).

SECTION 6.14. Foreign Subsidiaries. Organize, create, form or acquire any
subsidiary other than a Domestic Subsidiary.

SECTION 6.15. Formation of Subsidiaries. Directly or indirectly, organize or
invest in or permit any of its subsidiaries to directly or indirectly organize
or invest in any new subsidiary unless the amounts invested therein are
permitted under Section 6.04 and such subsidiary complies with the requirement
of Section 5.12 applicable to it.

SECTION 6.16. Limitations on Deposit Accounts and Securities Accounts. Establish
or maintain any deposit account or securities account, other than (a) except as,
and for the period permitted, pursuant to Section 5.17(a), deposit accounts or
securities accounts subject to Control Agreements, (b) accounts holding no more
than $10,000,000 in the aggregate for any five consecutive Business Days,
(c) accounts of the Borrower or any Subsidiary on which a Lien is permitted
pursuant to Section 6.02 or (d) any other payroll account, trust account, escrow
account, zero balance account or substantially similar account, in each case to
the extent remaining such type of account.

 

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ARTICLE VII

Events of Default

In case of the happening of any of the following events (“Events of Default”):

(a) any representation or warranty made or deemed made in or in connection with
any Loan Document or the borrowings hereunder, or any representation, warranty,
statement or information contained in any report, certificate, financial
statement or other instrument furnished in connection with or pursuant to any
Loan Document, shall prove to have been false or misleading in any material
respect when so made, deemed made or furnished;

(b) default shall be made in the payment of any principal of any Term Loan when
and as the same shall become due and payable, whether at the due date thereof or
at a date fixed for prepayment thereof or by acceleration thereof or otherwise;

(c) default shall be made in the payment of any interest on any Term Loan or any
Administrative Agent Fee or any other amount (other than an amount referred to
in (b) above) due under any Loan Document, when and as the same shall become due
and payable, and such default shall continue unremedied for a period of three
Business Days;

(d) default shall be made in the due observance or performance by Intermediate
Holdings, the Borrower or any Subsidiary of any covenant, condition or agreement
contained in Section 5.01(a) (in the case of Intermediate Holdings and Borrower
only), 5.05(a) or 5.08 or in Article VI;

(e) default shall be made in the due observance or performance by Intermediate
Holdings, the Borrower or any Subsidiary of any covenant, condition or agreement
contained in any Loan Document (other than those specified in (b), (c) or
(d) above) and such default shall continue (x) in the case of Section 5.02
unremedied for a period of five Business Days and (y) in the case of all other
defaults set forth in this clause (e), unremedied for a period of 30 days, in
each case, after the earlier of (i) notice thereof from the Administrative Agent
to the Borrower (which notice shall also be given at the request of any Lender)
or (ii) knowledge thereof of Intermediate Holdings or the Borrower;

(f) (i) Intermediate Holdings, the Borrower or any Subsidiary shall fail to pay
any principal, interest or any other amount, regardless of amount (beyond the
period of grace, if any, provided therein), due in respect of any Material
Indebtedness, when and as the same shall become due and payable, or (ii) any
other event or condition occurs, in any such case, that results in any Material
Indebtedness becoming due prior to its scheduled maturity or that enables or
permits (with or without the giving of notice, but after giving effect to any
required lapse of time) the holder or holders of any Material Indebtedness or
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agent on its or their behalf to cause any Material Indebtedness to become due,
or to require the prepayment, repurchase, redemption or defeasance thereof,
prior to its scheduled maturity; provided that this clause (ii) shall not apply
to secured Indebtedness that becomes due as a result of the voluntary sale or
transfer of the property or assets securing such Indebtedness if such sale or
transfer is permitted under the documentation providing for such Indebtedness;

(g) an involuntary proceeding shall be commenced or an involuntary petition
shall be filed in a court of competent jurisdiction seeking (i) relief in
respect of Intermediate Holdings, the Borrower or any Subsidiary (other than an
Immaterial Subsidiary), or of a substantial part of the property or assets of
Intermediate Holdings, the Borrower or a Subsidiary (other than an Immaterial
Subsidiary), under any Debtor Relief Law, (ii) the appointment of a receiver,
trustee, custodian, sequestrator, conservator or similar official for
Intermediate Holdings, the Borrower or any Subsidiary (other than an Immaterial
Subsidiary) or for a substantial part of the property or assets of Intermediate
Holdings, the Borrower or a Subsidiary or (iii) the winding-up or liquidation of
Intermediate Holdings, the Borrower or any Subsidiary (other than an Immaterial
Subsidiary); and such proceeding or petition shall continue undismissed for
60 days or an order or decree approving or ordering any of the foregoing shall
be entered;

(h) Intermediate Holdings, the Borrower or any Subsidiary (other than an
Immaterial Subsidiary) shall (i) voluntarily commence any proceeding or file any
petition seeking relief under any Debtor Relief Law, (ii) consent to the
institution of, or fail to contest in a timely and appropriate manner, any
proceeding or the filing of any petition described in (g) above, (iii) apply for
or consent to the appointment of a receiver, trustee, custodian, sequestrator,
conservator or similar official for Intermediate Holdings, the Borrower or any
Subsidiary (other than an Immaterial Subsidiary) or for a substantial part of
the property or assets of Intermediate Holdings, the Borrower or any Subsidiary
(other than an Immaterial Subsidiary), (iv) file an answer admitting the
material allegations of a petition filed against it in any such proceeding,
(v) make a general assignment for the benefit of creditors, (vi) become unable,
admit in writing its inability or fail generally to pay its debts as they become
due or (vii) take any action for the purpose of effecting any of the foregoing;

(i) one or more judgments, decrees or orders of any court for, except in the
case of clause (ii) below, the payment of money (excluding any amount paid or
covered by insurance of a reputable and solvent insurance company that has not
denied or disputed such coverage) shall be rendered against Intermediate
Holdings, the Borrower, any Subsidiary (other than any Immaterial Subsidiary) or
any combination thereof and the same shall remain undischarged for a period of
30 consecutive days during which execution shall not be effectively stayed or
bonded, or any action shall be legally taken by a judgment creditor to levy upon
assets or properties of Intermediate Holdings, the Borrower or any Subsidiary to
enforce any such judgment and such judgment either (i) is for the payment of

 

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money in an aggregate amount in excess of $50,000,000 or (ii) is for injunctive
relief and has resulted in a Material Adverse Effect;

(j) an ERISA Event shall have occurred that, when taken together with all other
such ERISA Events of the Borrower and its ERISA Affiliates, results in or would
reasonably be expected to result in a Material Adverse Effect;

(k) any Guarantee under the Guarantee and Collateral Agreement for any reason
shall cease to be in full force and effect (other than in accordance with its
terms), or any Subsidiary Guarantor shall deny in writing that it has any
further liability under the Guarantee and Collateral Agreement (other than as a
result of the discharge of such Subsidiary Guarantor in accordance with the
terms of the Loan Documents);

(l) any security interest on any material portion of the Collateral purported to
be created by any Security Document shall cease to be, or shall be asserted by
the Borrower or any other Loan Party not to be, a valid, perfected, first
priority (except as otherwise expressly provided in this Agreement or such
Security Document) security interest in any collateral covered thereby;

(m) any Indebtedness of Intermediate Holdings and its Subsidiaries constituting
Material Indebtedness and which by its terms purports to be subordinated in
right of payment to the Obligations shall cease (or any relevant Loan Party
shall so assert), for any reason, to be validly subordinated to the Obligations
as, and to the extent, provided in the agreements evidencing such other
subordinated Indebtedness;

(n) there shall have occurred a Change in Control; or

(o) (i) the Borrower or any other Loan Party shall fail to perform or observe
any term, covenant or agreement contained in any Material Project Document on
its part to be performed or observed if such failure has caused a Material
Adverse Effect; (ii) any party (other than the Borrower or any other Loan Party)
to any of the Material Project Documents shall fail to perform or observe any
term, covenant or agreement contained in such agreement on its part to be
performed or observed if such failure shall remain unremedied for 60 days, such
failure has caused a Material Adverse Effect, and the Borrower or the applicable
Loan Party shall not have entered into a Replacement Project Document within
such period; or (iii) (A) any provision of any Material Project Document after
delivery thereof shall for any reason cease to be valid and binding on or
enforceable against any party thereto (except upon fulfillment of such party’s
obligations thereunder), or any such party shall so state in writing, and such
event has caused a Material Adverse Effect, or (B) any Material Project Document
shall be terminated prior to its stated maturity and such termination has caused
a Material Adverse Effect, and, in each such case, the Borrower or the
applicable Loan Party shall not have entered into a Replacement Project
Document;

 

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then, and in every such event (other than an event described in paragraph (g) or
(h) above), and at any time thereafter during the continuance of such event, the
Administrative Agent may, and at the request of the Required Lenders shall, by
notice to the Borrower, take the following actions, at the same or different
times: declare the Term Loans then outstanding to be forthwith due and payable
in whole or in part, whereupon the principal of the Term Loans so declared to be
due and payable, together with accrued interest thereon and any unpaid accrued
Administrative Agent Fees and all other liabilities of the Borrower accrued
hereunder and under any other Loan Document, shall become forthwith due and
payable, without presentment, demand, protest or any other notice of any kind,
all of which are hereby expressly waived by the Borrower, anything contained
herein or in any other Loan Document to the contrary notwithstanding; and in any
event described in paragraph (g) or (h) above, the principal of the Term Loans
then outstanding, together with accrued interest thereon and any unpaid accrued
Administrative Agent Fees and all other liabilities of the Borrower accrued
hereunder and under any other Loan Document, shall automatically become due and
payable, without presentment, demand, protest or any other notice of any kind,
all of which are hereby expressly waived by the Borrower, anything contained
herein or in any other Loan Document to the contrary notwithstanding.

ARTICLE VIII

The Administrative Agent and the Collateral Trustee; Etc.

Each Lender hereby irrevocably appoints the Administrative Agent and the
Collateral Trustee (for purposes of this Article VIII, the Administrative Agent
and the Collateral Trustee are referred to collectively as the “Agents”) to act
on its behalf as the Agents hereunder and under the Loan Documents and
authorizes the Agents to take such actions on its behalf and to exercise such
powers as are delegated to such Agent by the terms hereof and thereof, together
with such actions and powers as are reasonably incidental thereto. The
provisions of this Article are solely for the benefit of the Agents and the
Lenders, and neither the Borrower nor any other Loan Party shall have rights as
a third-party beneficiary of any of such provisions. It is understood and agreed
that the use of the term “agent” herein or in any other Loan Documents (or any
other similar term) with reference to the Administrative Agent or Collateral
Trustee, as applicable, 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 as a matter of market custom, and is intended to
create or reflect only an administrative relationship between contracting
parties. Without limiting the generality of the foregoing, the Agents are hereby
expressly authorized to (i) execute any and all documents (including releases)
with respect to the Collateral and the rights of the Secured Parties with
respect thereto, as contemplated by and in accordance with the provisions of
this Agreement and the Security Documents and (ii) negotiate, enforce or the
settle any claim, action or proceeding affecting the Lenders in their capacity
as such, at the direction of the Required Lenders, which negotiation,
enforcement or settlement will be binding upon each Lender.

 

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The Person serving as the Administrative Agent and/or the Collateral Trustee
hereunder shall have the same rights and powers in its capacity as a Lender as
any other Lender and may exercise the same as though it were not an Agent, and
the term “Lender” or “Lenders” shall, unless otherwise expressly indicated or
unless the context otherwise requires, include the Person serving as an Agent
hereunder in its individual capacity. Such Person and its Affiliates may accept
deposits from, lend money to, own securities of, act as the financial advisor or
in any other advisory capacity for, and generally engage in any kind of business
with Intermediate Holdings, the Borrower or any Subsidiary or other Affiliate
thereof as if it were not an Agent hereunder and without any duty to account
therefor to the Lenders.

Neither Agent shall have any duties or obligations except those expressly set
forth herein and in the Loan Documents, and its duties hereunder shall be
administrative in nature. Without limiting the generality of the foregoing,
(a) neither Agent shall be subject to any fiduciary or other implied duties,
regardless of whether a Default has occurred and is continuing, (b) neither
Agent shall have any duty to take any discretionary action or exercise any
discretionary powers, except discretionary rights and powers expressly
contemplated hereby that such Agent is instructed in writing to exercise by the
Required Lenders (or such other number or percentage of the Lenders as shall be
necessary under the circumstances as provided for herein or in the other Loan
Documents); provided that neither Agent shall be required to take any action
that, in its opinion or the opinion of its counsel, may expose such Agent to
liability or that is contrary to any Loan Document or applicable law, including
for the avoidance of doubt any action that may be in violation of the automatic
stay under any Debtor Relief Law or that may effect a forfeiture, modification
or termination of property of a Defaulting Lender in violation of any Debtor
Relief Law, and (c) except as expressly set forth herein and in the other Loan
Documents, neither Agent shall have any duty to disclose, nor shall it be liable
for the failure to disclose, any information relating to Intermediate Holdings,
the Borrower or any of the Subsidiaries that is communicated to or obtained by
the Person serving as Administrative Agent and/or Collateral Trustee or any of
its Affiliates in any capacity. Neither Agent shall be liable for any action
taken or not taken by it with the consent or at the request of the Required
Lenders (or such other number or percentage of the Lenders as shall be
necessary, or as such Agent shall believe in good faith shall be necessary ,
under the circumstances as provided in Article VII or Section 9.08) or in the
absence of its own gross negligence or willful misconduct as determined by a
court of competent jurisdiction by a final non-appealable judgment. Neither
Agent shall be deemed to have knowledge of any Default unless and until written
notice thereof is given to such Agent by Intermediate Holdings, the Borrower or
a Lender. Neither Agent shall be responsible for or have any duty to ascertain
or inquire into (i) any statement, warranty or representation made in or in
connection with this Agreement or any other Loan Document, (ii) the contents of
any certificate, report or other document delivered thereunder or in connection
therewith, (iii) the performance or observance of any of the covenants,
agreements or other terms or conditions set forth herein and therein or the
occurrence of any Default, (iv) the validity, enforceability, effectiveness or
genuineness of this Agreement, any Loan Document or any other agreement,
instrument or document, or (v) the satisfaction of any condition set forth in
Article IV or elsewhere in any Loan

 

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Document, other than to confirm receipt of items expressly required to be
delivered to such Agent.

Each Agent shall be entitled to rely upon, and shall not incur any liability for
relying upon, any notice, request, certificate, consent, statement, instrument,
document or other writing (including any electronic message, Internet or
intranet website posting or other distribution) believed by it to be genuine and
to have been signed, sent or otherwise authenticated by the proper Person. Each
Agent may also rely upon any statement made to it orally or by telephone and
believed by it to have been made by the proper Person, and shall not incur any
liability for relying thereon. In determining compliance with any condition
hereunder to the making of a Term Loan that by its terms must be fulfilled to
the reasonable satisfaction of a Lender, each Agent may presume that such
condition is reasonably satisfactory to such Lender unless such Administrative
Agent shall have received notice to the contrary from such Lender prior to the
making of such Term Loan. Each Agent may consult with legal counsel (who may be
counsel for the Borrower), independent accountants and other experts selected by
it, and shall not be liable for any action taken or not taken by it in
accordance with the advice of any such counsel, accountants or experts.

Each Agent may perform any and all its duties and exercise its rights and powers
hereunder or under any other Loan Document by or through any one or more
sub-agents appointed by it. Each Agent and any such sub-agent may perform any
and all its duties and exercise its rights and powers by or through their
respective Related Parties. The exculpatory provisions of the preceding
paragraphs shall apply to any such sub-agent and to the Related Parties of each
Agent and any such sub-agent, and shall apply to their respective activities in
connection with the syndication of the Credit Facilities as well as activities
as Agent. Neither Agent shall be responsible for the negligence or misconduct of
any sub-agents except to the extent that a court of competent jurisdiction
determines in a final and non-appealable judgment that such Agent acted with
gross negligence or willful misconduct in the selection of such sub-agents.

Each Agent may at any time give notice of its resignation to the Lenders and the
Borrower. Upon receipt of any such notice of resignation, the Required Lenders
shall have the right, in consultation with the Borrower, to appoint a successor
Administrative Agent or Collateral Trustee, as the case may be, which shall be a
bank with an office in New York, New York, or an Affiliate of any such bank with
an office in New York, New York. If no such successor shall have been so
appointed by the Required Lenders and shall have accepted such appointment
within 30 days after the retiring Administrative Agent gives notice of its
resignation (or such earlier day as shall be agreed by the Required Lenders)
(the “Resignation Effective Date”), then the retiring Agent may (but shall not
be obligated to), on behalf of the Lenders, appoint a successor Agent meeting
the qualifications set forth above. Whether or not a successor has been
appointed, such resignation shall become effective in accordance with such
notice on the Resignation Effective Date. If the Person serving as Agent is a
Defaulting Lender, the Required Lenders may, to the extent permitted by
applicable law, by notice in writing to the Borrower and such Person remove such
Person as Agent and, in consultation with the Borrower, appoint a successor
Administrative Agent or Collateral Trustee, as the case

 

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may be. If no such successor shall have been so appointed by the Required
Lenders and shall have accepted such appointment within 30 days (or such earlier
day as shall be agreed by the Required Lenders) (the “Removal Effective Date”),
then such removal shall nonetheless become effective in accordance with such
notice on the Removal Effective Date. With effect from the Resignation Effective
Date or the Removal Effective Date (as applicable) (a) the retiring or removed
Agent shall be discharged from its duties and obligations hereunder and under
the other Loan Documents (except that in the case of any collateral security
held by such Agent on behalf of the Lenders under any of the Loan Documents, the
retiring or removed Agent shall continue to hold such collateral security until
such time as a successor Agent is appointed) and (b) all payments,
communications and determinations provided to be made by, to or through such
Agent shall instead be made by or to each Lender directly, until such time, if
any, as the Required Lenders appoint a successor Agent as provided for above.
Upon the acceptance of a successor’s appointment as an Agent hereunder, such
successor shall succeed to and become vested with all of the rights, powers,
privileges and duties of the retiring or removed Agent, and the retiring or
removed Agent shall be discharged from all of its duties and obligations
hereunder or under the other Loan Documents. The fees payable by the Borrower to
a successor Agent shall be the same as those payable to its predecessor unless
otherwise agreed between the Borrower and such successor. After the retiring or
removed Administrative Agent’s resignation or removal hereunder and under the
other Loan Documents, the provisions of this Article and Section 9.05 shall
continue in effect for the benefit of such retiring or removed Agent, its
sub-agents and their respective Related Parties in respect of any actions taken
or omitted to be taken by any of them while the retiring or removed Agent was
acting as Agent.

Each Lender acknowledges that it has, independently and without reliance upon
the Agents or any other Lender or any of their Related Parties and based on such
documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement. Each Lender also
acknowledges that it will, independently and without reliance upon the Agents or
any other Lender or any of their Related Parties and based on such documents and
information as it shall from time to time deem appropriate, continue to make its
own decisions in taking or not taking action under or based upon this Agreement,
any other Loan Document, any related agreement or any document furnished
hereunder or thereunder.

Notwithstanding any other provision of this Agreement or any provision of any
other Loan Document, each of the Joint Lead Arrangers, the Joint Syndication
Agents, the Co-Documentation Agents and the Co-Manager listed on the cover page
hereof shall not have any powers, duties or responsibilities under this
Agreement or any of the other Loan Documents, except in its capacity, as
applicable, as the Administrative Agent, the Collateral Trustee or a Lender
hereunder; it being understood and agreed that each of the Joint Lead Arrangers,
the Joint Syndication Agents, the Co-Documentation Agents and the Co-Manager
shall be entitled to all indemnification and reimbursement rights in favor of
the Agents provided herein and in the other Loan Documents. Without limitation
of the foregoing, neither the Joint Lead Arrangers, the Joint Syndication
Agents, the Co-Documentation Agents nor the Co-Manager in their respective
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by reason of this Agreement or any other Loan Document, have any fiduciary
relationship in respect of any Lender, Loan Party or any other Person.

In case of the pendency of any proceeding under any Debtor Relief Law or any
other judicial proceeding relative to any Loan Party, each Agent (irrespective
of whether the principal of any Term Loan shall then be due and payable as
herein expressed or by declaration or otherwise and irrespective of whether such
Agent shall have made any demand on the Borrower) shall be entitled and
empowered (but not obligated) by intervention in such proceeding or otherwise
(a) to file and prove a claim for the whole amount of the principal and interest
owing and unpaid in respect of the Term Loans and all other Obligations that are
owing and unpaid and to file such other documents as may be necessary or
advisable in order to have the claims of the Lenders and the Agents (including
any claim for the reasonable compensation, expenses, disbursements and advances
of the Lenders and the Agents and their respective agents and counsel and all
other amounts due the Lenders and Agents under Section 9.05) allowed in such
judicial proceeding and (b) to collect and receive any monies or other property
payable or deliverable on any such claims and to distribute the same and, in
either case, any custodian, receiver, assignee, trustee, liquidator,
sequestrator or other similar official in any such judicial proceeding is hereby
authorized by each Lender to make such payments to such Agent and, in the event
that such Agent shall consent to the making of such payments directly to the
Lenders, to pay to such Agent any amount due for the reasonable compensation,
expenses, disbursements and advances of such Agent and its agents and counsel,
and any other amounts due such Agent under Sections 9.05.

The Lenders irrevocably authorize the Administrative Agent, at its option and in
its discretion, to instruct Collateral Trustee, in accordance with the
Intercreditor Agreement, (a) to release any Lien on any property granted to or
held by the Collateral Trustee under any Loan Document (i) upon payment in full
of all Obligations (other than contingent indemnification obligations),
(ii) that is sold or otherwise disposed of or to be sold or otherwise disposed
of as part of or in connection with any sale or other disposition permitted
under the Loan Documents, or (iii) subject to Section 9.08, if approved,
authorized or ratified in writing by the Required Lenders, (b) to subordinate
any Lien on any property granted to or held by the Collateral Trustee under any
Loan Document to the holder of any Lien on such property that is permitted by
Sections 6.02(a), (h), (r), (s) and (t), and (c) to release any Subsidiary
Guarantor from its obligations under the Guarantee and Collateral Agreement if
such Person ceases to be a Subsidiary as a result of a transaction permitted
under the Loan Documents. Upon request by the Collateral Trustee at any time,
the Required Lenders will confirm in writing the Collateral Trustee’s authority
to release or subordinate its interest in particular types or items of property,
or to release any Subsidiary Guarantor from its obligations under the Guarantee
and Collateral Agreement pursuant to this Article VIII. The Collateral Trustee
shall not be responsible for or have a duty to ascertain or inquire into any
representation or warranty regarding the existence, value or collectability of
the Collateral, the existence, priority or perfection of the Collateral
Trustee’s Lien thereon, or any certificate prepared by any Loan Party in
connection therewith, nor shall the Collateral Trustee be responsible or liable
to the Lenders for any failure to monitor or maintain any portion of the
Collateral.

 

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To the extent required by any applicable law, the Administrative Agent may
withhold from any payment to any Lender an amount equivalent to any applicable
withholding Tax. If any payment has been made to any Lender by the
Administrative Agent without the applicable withholding Tax being withheld from
such payment and the Administrative Agent has paid over the applicable
withholding Tax to the Internal Revenue Service or any other Governmental
Authority, or the Internal Revenue Service or any other Governmental Authority
asserts a claim that the Administrative Agent did not properly withhold Tax from
amounts paid to or for the account of any Lender because the appropriate form
was not delivered or was not properly executed or because such Lender failed to
notify the Administrative Agent of a change in circumstance which rendered the
exemption from, or reduction of, withholding Tax ineffective or for any other
reason, such Lender shall indemnify the Administrative Agent fully for all
amounts paid, directly or indirectly, by the Administrative Agent as Tax or
otherwise, including any penalties or interest and together with all expenses
(including legal expenses, allocated internal costs and out-of-pocket expenses)
incurred.

ARTICLE IX

Miscellaneous

SECTION 9.01. Notices; Electronic Communications. Except in the case of notices
and other communications expressly permitted to be given by telephone (and
except for electronic communication provided below), all notices and other
communications provided for herein shall be in writing and shall be delivered by
hand or overnight courier service, mailed by certified or registered mail or
sent by facsimile as follows:

(a) if to the Borrower or if to Intermediate Holdings, to:

1000 Louisiana Street, Suite 5800

Houston, Texas 77002-5050

Attn: General Counsel

Telecopy: (713) 356-2200

Telephone: (713) 507-6400

(b) if to the Administrative Agent or the Collateral Trustee, to:

Credit Suisse, Agency Manager,

One Madison Avenue,

New York, NY 10010

Fax No. 212-322-2291

Email: agency.loanops@credit-suisse.com

(c) if to a Lender, to it at its address (or facsimile number) set forth in its
Administrative Questionnaire.

 

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Notices sent by hand or overnight courier service, or mailed by certified or
registered mail, shall be deemed to have been given when received; notices sent
by facsimile shall be deemed to have been given when sent (except that, if not
given during normal business hours for the recipient, shall be deemed to have
been given at the opening of business on the next Business Day for the
recipient). Notices delivered through electronic communications, to the extent
provided in the immediately succeeding paragraph below, shall be effective as
provided in said paragraph.

Notices and other communications to the Lenders hereunder may be delivered or
furnished by electronic communication (including e-mail and Internet or intranet
websites) pursuant to procedures approved by the Administrative Agent; provided
that the foregoing shall not apply to notices to any Lender pursuant to Article
II if such Lender has notified the Administrative Agent that it is incapable of
receiving notices under such Article by electronic communication. The
Administrative Agent or the Borrower may, in its discretion, agree to accept
notices and other communications to it hereunder by electronic communications
pursuant to procedures approved by it; provided that approval of such procedures
may be limited to particular notices or communications. Unless the
Administrative Agent otherwise prescribes, (i) notices and other communications
sent to an e-mail address shall be deemed received upon the sender’s receipt of
an acknowledgement from the intended recipient (such as by the “return receipt
requested” function, as available, return e-mail or other written
acknowledgement), and (ii) notices or communications posted to an Internet or
intranet website shall be deemed received upon the deemed receipt by the
intended recipient, at its e-mail address as described in the foregoing
clause (i), of notification that such notice or communication is available and
identifying the website address therefor; provided that, for both clauses (i)
and (ii) above, if such notice, email or other communication is not sent during
the normal business hours of the recipient, such notice or communication shall
be deemed to have been sent at the opening of business on the next Business Day
for the recipient.

Any party hereto may change its address or facsimile number for notices and
other communications hereunder by notice to the other parties hereto.

Each Loan Party agrees that the Administrative Agent may, but shall not be
obligated to, make the Communications (as defined below) available to the
Lenders by posting the Communications on Debt Domain, Intralinks, Syndtrak or a
substantially similar electronic transmission system (the “Platform”). The
Platform is provided “as is” and “as available.” The Administrative Agent or any
of its Related Parties do not warrant the adequacy of the Platform and expressly
disclaim liability for errors or omissions in the Communications. No warranty of
any kind, express, implied or statutory, including, without limitation, any
warranty of merchantability, fitness for a particular purpose, non-infringement
of third-party rights or freedom from viruses or other code defects, is made by
Administrative Agent or any of its Related Parties in connection with the
Communications or the Platform. In no event shall the Administrative Agent or
any of its Related Parties have any liability to the Borrower or the other Loan
Parties, any Lender or any other Person or entity for damages of any kind,
including, without limitation, direct or indirect, special, incidental or
consequential damages, losses or expenses (whether in tort, contract or
otherwise) arising out of the Borrower’s, any Loan Party’s or

 

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the Administrative Agent’s transmission of communications through the Platform.
“Communications” means, collectively, any notice, demand, communication,
information, document or other material that any Loan Party provides to the
Administrative Agent pursuant to any Loan Document or the transactions
contemplated therein which is distributed to the Administrative Agent or any
Lender by means of electronic communications pursuant to this Section, including
through the Platform.

The Borrower hereby acknowledges that (a) the Administrative Agent will make
available to the Lenders materials and/or information provided by or on behalf
of the Borrower hereunder (collectively, the “Borrower Materials”) by posting
the Borrower Materials on the Platform and (b) certain of the Lenders may be
“public-side” Lenders (i.e., Lenders that do not wish to receive material
non-public information with respect to the Borrower or its securities) (each, a
“Public Lender”). The Borrower hereby agrees that (w) all Borrower Materials
that are to be made available to Public Lenders shall be clearly and
conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word
“PUBLIC” shall appear prominently on the first page thereof; (x) by marking
Borrower Materials “PUBLIC,” the Borrower shall be deemed to have authorized the
Administrative Agent and the Lenders to treat such Borrower Materials as not
containing any material non-public information with respect to the Borrower or
its securities for purposes of United States federal and state securities laws
(provided, however, that to the extent such Borrower Materials constitute
Information, they shall be treated as set forth in Section 9.16); (y) all
Borrower Materials marked “PUBLIC” are permitted to be made available through a
portion of the Platform designated as “Public Investor;” and (z) the
Administrative Agent shall be entitled to treat any Borrower Materials that are
not marked “PUBLIC” as being suitable only for posting on a portion of the
Platform not marked as “Public Investor.” Notwithstanding the foregoing, the
following Borrower Materials shall be marked “PUBLIC”, unless the Borrower
notifies the Administrative Agent promptly that any such document contains
material non-public information: (1) the Loan Documents and (2) notification of
changes in the terms of the Credit Facilities.

Each Public Lender agrees to cause at least one individual at or on behalf of
such Public Lender to at all times have selected the “Private Side Information”
or similar designation on the content declaration screen of the Platform in
order to enable such Public Lender or its delegate, in accordance with such
Public Lender’s compliance procedures and applicable law, including United
States Federal and state securities laws, to make reference to Communications
that are not made available through the “Public Side Information” portion of the
Platform and that may contain material non-public information with respect to
the Borrower or its securities for purposes of United States Federal or state
securities laws.

Nothing herein shall prejudice the right of the Administrative Agent or any
Lender to give any notice or other communication pursuant to any Loan Document
in any other manner specified in such Loan Document.

 

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SECTION 9.02. Survival of Agreement. All covenants, agreements, representations
and warranties made by the Borrower or Intermediate Holdings herein and in the
certificates or other instruments prepared or delivered in connection with or
pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the Lenders and shall survive the making by the Lenders
of the Term Loans, regardless of any investigation made by the Lenders or on
their behalf, and shall continue in full force and effect as long as the
principal of or any accrued interest on any Term Loan or any Administrative
Agent Fee or any other amount payable under this Agreement or any other Loan
Document is outstanding and unpaid. The provisions of Sections 2.14, 2.16, 2.20,
9.05 and 9.16 shall remain operative and in full force and effect regardless of
the expiration of the term of this Agreement, the consummation of the
transactions contemplated hereby, the repayment of any of the Term Loans, the
invalidity or unenforceability of any term or provision of this Agreement or any
other Loan Document, or any investigation made by or on behalf of the
Administrative Agent, the Collateral Trustee or any Lender; provided that, with
respect to any Lender or any Participant, Section 9.16 shall remain operative
and in full force and effect for a period one year following the repayment in
full of such Person’s Term Loans.

SECTION 9.03. Binding Effect. Except as provided in Article IV, this Agreement
shall become effective when it shall have been executed by the Administrative
Agent and when the Administrative Agent shall have received counterparts hereof
that, when taken together, bear the signatures of each of the other parties
hereto.

SECTION 9.04. Successors and Assigns. (a) The provisions of this Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby, except that the Borrower may
not assign or otherwise transfer any of its rights or obligations hereunder
without the prior written consent of each Agent and each Lender and any such
attempted transfer or assignment shall be null and void, and no Lender may
assign or otherwise transfer any of its rights or obligations hereunder except
(i) to an assignee in accordance with the provisions of paragraph (b) of this
Section, (ii) by way of participation in accordance with the provisions of
paragraph (d) of this Section, or (iii) by way of pledge or assignment of a
security interest subject to the restrictions of paragraph (f) of this Section
(and any other attempted assignment or transfer by any party hereto shall be
null and void). Nothing in this Agreement, expressed or implied, shall be
construed to confer upon any Person (other than the parties hereto, their
respective successors and assigns permitted hereby, Participants to the extent
provided in paragraph (d) of this Section and, to the extent expressly
contemplated hereby, the Related Parties of each of the Administrative Agent,
Joint Lead Arrangers, the Co-Manager and the Lenders) any legal or equitable
right, remedy or claim under or by reason of this Agreement.

(b) Any Lender may at any time assign to one or more assignees all or a portion
of its rights and obligations under this Agreement (including all or a portion
of its Term Loans at the time owing to it); provided that any such assignment
shall be subject to the following conditions:

 

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(i) (A) in the case of an assignment of the entire remaining amount of the
assigning Lender’s principal outstanding balance of the Term Loans or
contemporaneous assignments to related Approved Funds that equal at least the
amount specified in paragraph (b)(i)(B) of this Section in the aggregate or in
the case of an assignment to a Lender, an Affiliate of a Lender or an Approved
Fund, no minimum amount need be assigned and (B) in any case not described in
paragraph (b)(i)(A) of this Section, the principal outstanding balance of the
Term Loans of the assigning Lender subject to each such assignment (determined
as of the date the Assignment and Assumption with respect to such assignment is
delivered to the Administrative Agent or, if “Trade Date” is specified in the
Assignment and Assumption, as of the Trade Date) shall not be less than
$1,000,000, in the case of any assignment in respect of Term Loans, unless each
of the Administrative Agent and, so long as no Event of Default has occurred and
is continuing, the Borrower otherwise consents (each such consent not to be
unreasonably withheld or delayed); provided that the consent of the Borrower
pursuant to this clause (i)(B) shall be deemed to be given if the Borrower does
not consent to or reject such assignment within 10 days of receipt of notice
thereof.

(ii) Each partial assignment shall be made as an assignment of a proportionate
part of all the assigning Lender’s rights and obligations under this Agreement
with respect to the Term Loans assigned, except that this clause (ii) shall not
prohibit any Lender from assigning all or a portion of its rights and
obligations among separate Credit Facilities on a non-pro rata basis.

(iii) No consent shall be required for any assignment except to the extent
required by paragraph (b)(i)(B) of this Section and, in addition, the consent of
the Administrative Agent (such consent not to be unreasonably withheld, delayed
or conditioned) shall be required for assignments in respect of any Term Loans
to a Person who is not a Lender, an Affiliate of a Lender or an Approved Fund.

(iv) The parties to each assignment shall (A) execute and deliver to the
Administrative Agent an Assignment and Assumption, via an electronic settlement
system acceptable to the Administrative Agent or (B) if previously agreed with
the Administrative Agent, manually execute and deliver to the Administrative
Agent an Assignment and Assumption, in each case, together with a processing and
recordation fee of $3,500; provided that the Administrative Agent may, in its
sole discretion, elect to waive or reduce such processing and recordation fee in
the case of any assignment. The assignee, if it is not a Lender, shall deliver
to the Administrative Agent an Administrative Questionnaire and all applicable
tax forms.

(v) No such assignment shall be made to any Disqualified Lender; provided that
no Agent shall have any liability or responsibility to monitor, police or
control any assignments to Disqualified Lenders.

(vi) No such assignment shall be made to (A) a natural Person, or (B) the
Borrower or any of its Affiliates; provided that this clause (B) shall not apply
with

 

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respect to any Affiliate of the Borrower for assignments (I) permitted pursuant
to Section 2.12(e), (II) to a Qualified Debt Investor or (III) in connection
with the primary syndication of the Term Loans.

Subject to acceptance and recording thereof by the Administrative Agent pursuant
to paragraph (c) of this Section, from and after the effective date specified in
each Assignment and Assumption, the assignee thereunder shall be a party to this
Agreement and, to the extent of the interest assigned by such Assignment and
Assumption, have the rights and obligations of a Lender under this Agreement,
and the assigning Lender thereunder shall, to the extent of the interest
assigned by such Assignment and Assumption, be released from its obligations
under this Agreement (and, in the case of an Assignment and Assumption covering
all of the assigning Lender’s rights and obligations under this Agreement, such
Lender shall cease to be a party hereto) but shall continue to be entitled to
the benefits of Sections Sections 2.14, 2.16, 2.20 and 9.05 with respect to
facts and circumstances occurring prior to the effective date of such
assignment; provided that except to the extent otherwise expressly agreed by the
affected parties, no assignment by a Defaulting Lender will constitute a waiver
or release of any claim of any party hereunder arising from that Lender’s having
been a Defaulting Lender. Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this paragraph shall
be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with paragraph (f) of
this Section.

(c) By executing and delivering an Assignment and Assumption, the assigning
Lender thereunder and the assignee thereunder shall be deemed to confirm to and
agree with each other and the other parties hereto as follows: (i) such
assigning Lender warrants that it is the legal and beneficial owner of the
interest being assigned thereby free and clear of any adverse claim and that the
outstanding balances of its Term Loans without giving effect to assignments
thereof which have not become effective, are as set forth in such Assignment and
Assumption, (ii) except as set forth in (i) above, such assigning Lender makes
no representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement, or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement, any other Loan Document or any other
instrument or document furnished pursuant hereto, or the financial condition of
the Borrower or any Subsidiary or the performance or observance by the Borrower
or any Subsidiary of any of its obligations under this Agreement, any other Loan
Document or any other instrument or document furnished pursuant hereto,
(iii) such assignee represents and warrants that it is an Eligible Assignee
legally authorized to enter into such Assignment and Assumption, (iv) such
assignee confirms that it has received a copy of this Agreement, together with
copies of the most recent financial statements referred to in Section 3.05(a) or
delivered pursuant to Section 5.04 and such other documents and information as
it has deemed appropriate to make its own credit analysis and decision to enter
into such Assignment and Assumption, (v) such assignee will independently and
without reliance upon the Administrative Agent, the Collateral Trustee, such
assigning

 

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Lender 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 this Agreement, (vi) such assignee appoints
and authorizes the Administrative Agent and the Collateral Trustee to take such
action as agent on its behalf and to exercise such powers under this Agreement
as are delegated to the Administrative Agent and the Collateral Trustee,
respectively, by the terms hereof, together with such powers as are reasonably
incidental thereto and (vii) such assignee agrees that it will perform in
accordance with their terms all the obligations which by the terms of this
Agreement are required to be performed by it as a Lender.

(d) The Administrative Agent, acting solely for this purpose as an agent of the
Borrower, shall maintain at one of its offices in The City of New York a copy of
each Assignment and Assumption delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the principal amounts
of and stated interest on the Term Loans owing to, each Lender pursuant to the
terms hereof from time to time (the “Register”). The entries in the Register
shall be conclusive absent manifest error, and the Borrower, the Administrative
Agent and the Lenders shall treat each Person whose name is recorded in the
Register pursuant to the terms hereof as a Lender hereunder for all purposes of
this Agreement. The Register shall be available for inspection by the Borrower
and any Lender, at any reasonable time and from time to time upon reasonable
prior notice.

(e) Upon its receipt of, and consent to, a duly completed Assignment and
Assumption executed by an assigning Lender and an assignee, an Administrative
Questionnaire completed in respect of the assignee (unless the assignee shall
already be a Lender hereunder), the processing and recordation fee referred to
in paragraph (b) above, if applicable, and the written consent of the
Administrative Agent to such assignment and any applicable tax forms or other
documentation, the Administrative Agent shall (i) accept such Assignment and
Assumption and (ii) promptly record the information contained therein in the
Register. No assignment shall be effective unless it has been recorded in the
Register as provided in this paragraph (e).

(f) Any Lender may at any time, without the consent of, or notice to, the
Borrower or the Administrative Agent, sell participations to any Person (other
than a natural Person) (each, a “Participant”) in all or a portion of such
Lender’s rights and/or obligations under this Agreement (including all or a
portion of the Term Loans owing to it); provided that (i) such Lender’s
obligations under this Agreement shall remain unchanged, (ii) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations, and (iii) the Borrower, the Agents and Lenders shall continue
to deal solely and directly with such Lender in connection with such Lender’s
rights and obligations under this Agreement. For the avoidance of doubt, each
Lender shall be responsible for the indemnity under Section 9.05(c) with respect
to any payments made by such Lender to its Participant(s). Any agreement or
instrument pursuant to which a Lender sells such a participation shall provide
that such Lender shall retain the sole

 

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right to enforce this Agreement and to approve any amendment, modification or
waiver of any provision of this Agreement; provided that such agreement or
instrument may provide that such Lender will not, without the consent of the
Participant, agree to any amendment, modification or waiver decreasing any fees
payable to such Participant or the amount of principal of or the rate at which
interest is payable on the Term Loans in which such Participant has an interest,
extending any scheduled principal payment date or date fixed for the payment of
interest on the Term Loans in which such Participant has an interest or
releasing all or substantially all of the value of the Guarantees provided by
the Subsidiary Guarantors (other than in connection with the sale of the
respective Subsidiary Guarantors in a transaction permitted by Section 6.05) or
releasing all or substantially all of the Collateral. The Borrower agrees that
each Participant shall, subject to the last sentence of this clause (f), be
entitled to the benefits of Sections 2.14, 2.16 and 2.20 to the same extent as
if it were a Lender and had acquired its interest by assignment pursuant to
paragraph (b) of this Section; provided that such Participant agrees to be
subject to the provisions of Section 2.21 as if it were an assignee under
paragraph (b) of this Section. To the extent permitted by law, each Participant
also shall be entitled to the benefits of Section 9.06 as though it were a
Lender; provided that such Participant agrees to be subject to Sections 2.18 and
9.17 as though it were a Lender. Each Lender that sells a participation shall,
acting solely for this purpose as an agent of the Borrower, maintain a register
on which it enters the name and address of each Participant and the principal
amounts (and stated interest) of each Participant’s interest in the Term Loans
or other rights or obligations under the Loan Documents (each such register, a
“Participant Register”); provided that no Lender shall have any obligation to
disclose all or any portion of any Participant Register to any Person (including
the identity of any Participant or any information relating to a Participant’s
interest in any Term Loans or other rights or obligations under any Loan
Document) except to the extent that such disclosure is necessary to establish
that such Term Loan or other right or obligation is in registered form under
Section 5f.103-1(c) of the U.S. Treasury Regulations. The entries in a
Participant Register shall be conclusive absent manifest error, and such Lender
shall treat each Person whose name is recorded in the Participant Register as
the owner of such participation for all purposes of this Agreement
notwithstanding any notice to the contrary. A Participant shall not be entitled
to receive any greater payment under Sections 2.14, 2.16 and 2.20 than the
applicable Lender would have been entitled to receive with respect to the
participation sold to such Participant, unless the sale of the participation to
such Participant is made with the Borrower’s prior written consent. A
Participant that would be a Foreign Lender if it were a Lender shall not be
entitled to the benefits of Section 2.20 to the extent such Participant fails to
comply with Section 2.20(e) and (f) as though it were a Lender.

(g) Any Lender or participant may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this
Section 9.04, disclose to the respective permitted assignee or participant or
proposed permitted assignee or participant any information relating to the
Borrower furnished to such Lender by or on behalf of the Borrower; provided
that, prior to any such disclosure

 

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of information designated by the Borrower as confidential, each such assignee or
participant or proposed assignee or participant shall execute an agreement
whereby such assignee or participant shall agree (subject to customary
exceptions) to preserve the confidentiality of such confidential information on
terms no less restrictive than those applicable to the Lenders pursuant to
Section 9.16.

(h) Any Lender may at any time pledge or assign a security interest in all or
any portion of its rights under this Agreement to secure obligations of such
Lender, including any pledge or assignment to secure obligations to a Federal
Reserve Bank; provided that no such pledge or assignment shall release such
Lender from any of its obligations hereunder or substitute any such pledgee or
assignee for such Lender as a party hereto.

(i) Notwithstanding anything to the contrary contained herein, any Lender (a
“Granting Lender”) may grant to a special purpose funding vehicle (an “SPV”),
identified as such in writing from time to time by the Granting Lender to the
Administrative Agent and the Borrower, the option to provide to the Borrower all
or any part of any Term Loan that such Granting Lender would otherwise be
obligated to make to the Borrower pursuant to this Agreement; provided
that (i) nothing herein shall constitute a commitment by any SPV to make any
Term Loan and (ii) if an SPV elects not to exercise such option or otherwise
fails to provide all or any part of such Term Loan, the Granting Lender shall be
obligated to make such Term Loan pursuant to the terms hereof. Each party hereto
hereby agrees that no SPV shall be liable for any indemnity or similar payment
obligation under this Agreement (all liability for which shall remain with the
Granting Lender). In furtherance of the foregoing, each party hereto hereby
agrees (which agreement shall survive the termination of this Agreement) that,
prior to the date that is one year and one day after the payment in full of all
outstanding commercial paper or other senior indebtedness of any SPV, it will
not institute against, or join any other Person in instituting against, such SPV
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings under Debtor Relief Law. In addition, notwithstanding anything to
the contrary contained in this Section 9.04, any SPV may (i) with notice to, but
without the prior written consent of, the Administrative Agent and without
paying any processing fee therefor, assign all or a portion of its interests in
any Term Loans to the Granting Lender or to any financial institutions
(consented to by the Borrower and Administrative Agent) providing liquidity
and/or credit support to or for the account of such SPV to support the funding
or maintenance of Term Loans and (ii) disclose on a confidential basis any
non-public information relating to its Term Loans to any rating agency,
commercial paper dealer or provider of any surety, guarantee or credit or
liquidity enhancement to such SPV.

SECTION 9.05. Expenses; Indemnity. (a) The Borrower and Intermediate Holdings
shall pay, jointly and severally, (i) all reasonable and documented
out-of-pocket expenses incurred by the Agents, the Joint Lead Arrangers, the
Co-Manager and their Affiliates (including the reasonable fees, charges and
disbursements of counsel for the Agents and of a single local counsel in each
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syndication of the Credit Facilities, the preparation, negotiation, execution,
delivery and administration of this Agreement and the other Loan Documents, or
any amendments, modifications or waivers of the provisions hereof or thereof
(whether or not the transactions contemplated hereby or thereby shall be
consummated) and (ii) all reasonable and documented out-of-pocket expenses
incurred by the Agents and any Lender (including the reasonable fees, charges
and disbursements of any counsel for any Agents, the Joint Lead Arrangers, the
Co-Manager or any Lender) in connection with the enforcement or protection of
its rights (A) in connection with this Agreement and the other Loan Documents,
including its rights under this Section, or (B) in connection with the Term
Loans made hereunder, including all such reasonable and documented out-of-pocket
expenses incurred during any workout, restructuring or negotiations in respect
of such Term Loans.

(b) The Borrower and Intermediate Holdings shall indemnify, jointly and
severally, each Agent (and any sub-agent thereof), each Joint Lead Arranger, the
Co-Manager, each Lender, and each Related Party of any of the foregoing Persons
(each such Person being called an “Indemnitee”) against, and hold each
Indemnitee harmless from, any and all losses, claims, damages, liabilities and
related expenses (including the reasonable fees, charges and disbursements of
one firm of counsel for any Indemnitee and, if necessary, one firm of local
counsel in each appropriate jurisdiction), and shall indemnify and hold harmless
each Indemnitee from all fees and time charges and disbursements, incurred by
any Indemnitee or asserted against any Indemnitee by any Person (including the
Borrower or any other Loan Party) arising out of, in connection with, or as a
result of (i) the execution or delivery of this Agreement, any other Loan
Document or any agreement or instrument contemplated hereby or thereby, the
performance by the parties hereto of their respective obligations hereunder or
thereunder or the consummation of the transactions contemplated hereby or
thereby, (ii) any Term Loan or the use or proposed use of the proceeds
therefrom, (iii) any actual or alleged presence or Release of Hazardous
Materials on or from any property owned or operated by the Borrower or any of
its Subsidiaries (except to the extent such Release occurs solely following
foreclosure upon such property and is not caused by or does not otherwise arise
out of any action or inaction by any Loan Party), or any Environmental Liability
related in any way to the Borrower or any of its Subsidiaries, or (iv) any
actual or prospective claim, litigation, investigation or proceeding relating to
any of the foregoing, whether based on contract, tort or any other theory,
whether brought by a third party or by the Borrower or any other Loan Party, and
regardless of whether any Indemnitee is a party thereto; provided that such
indemnity shall not, as to any Indemnitee, be available to the extent that such
losses, claims, damages, liabilities or related expenses (x) are determined by a
court of competent jurisdiction by final and non-appealable judgment to have
resulted from the gross negligence, bad faith or willful misconduct of such
Indemnitee or (y) are owed with respect to disputes between and among
Indemnitees (other than disputes against any Indemnitee in its capacity, or in
fulfilling its role as, an administrative agent or arranger (or against any
other Indemnitee acting in its capacity as affiliate, officer, director or
employee for such

 

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administrative agent or arranger acting in such capacity or role), or any
similar role under the Credit Facility).

If for any reason the foregoing indemnification is unavailable to an Indemnitee
or insufficient to hold it harmless, then the Borrower and Intermediate Holdings
will contribute to the amount paid or payable by such Indemnitee as a result of
such loss, claim, damage or liability in such proportion as is appropriate to
reflect the relative economic interests of (i) the Borrower and Intermediate
Holdings and their respective Subsidiaries, Affiliates, shareholders, partners,
members or other equity holders on the one hand and (ii) the Indemnitee on the
other hand in the matters contemplated by the Transactions as well as the
relative fault of (x) the Borrower and Intermediate Holdings and their
respective Subsidiaries, Affiliates, shareholders, partners, members or other
equity holders on the one hand and (y) the Indemnitee with respect to such loss,
claim, damage or liability and any other relevant equitable considerations. The
indemnity and contribution obligations of the Borrower and Intermediate Holdings
under this paragraph will be in addition to any liability which the Borrower and
Intermediate Holdings may otherwise have and will be binding upon and inure to
the benefit of any successors and assigns of the Borrower and Intermediate
Holdings, the Indemnitees, any such Subsidiaries and any such Affiliates.

(c) To the extent that Intermediate Holdings and the Borrower for any reason
fails to indefeasibly pay any amount required under paragraph (a) or (b) of this
Section to be paid by it to any Agent (or any sub-agent thereof), any Joint Lead
Arranger, the Co-Manager or any Related Party of any of the foregoing, each
Lender severally agrees to pay to such Agent (or any such sub-agent) such Joint
Lead Arranger, the Co-Manager or such Related Party, as the case may be, such
Lender’s pro rata share (determined as of the time that the applicable
unreimbursed expense or indemnity payment is sought based on each Lender’s share
of the Term Loans at such time) of such unpaid amount (including any such unpaid
amount in respect of a claim asserted by such Lender); provided that the
unreimbursed expense or indemnified loss, claim, damage, liability or related
expense, as the case may be, was incurred by or asserted against such Agent (or
any such sub-agent) such Joint Lead Arranger or the Co-Manager in its respective
capacity as such, or against any Related Party of any of the foregoing acting
for such Agent (or any such sub-agent) such Joint Lead Arranger or the
Co-Manager in connection with such capacity. For purposes hereof, a Lender’s
“pro rata share” shall be determined based upon its share of the outstanding
Term Loans at the time.

(d) To the fullest extent permitted by applicable law, no party hereto shall
assert, and each party hereto hereby waives, any claim against any Indemnitee or
Loan Party, on any theory of liability, for special, indirect, consequential or
punitive damages (as opposed to direct or actual damages) arising out of, in
connection with, or as a result of, this Agreement, any other Loan Document or
any agreement or instrument contemplated hereby, the transactions contemplated
hereby or thereby, any Term Loan, or the use of the proceeds thereof; provided
that such waiver shall not include or affect in any way the obligations of the
Borrower and Intermediate Holdings to indemnify the Indemnitees as set forth in
this Section

 

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9.05. No Indemnitee referred to in paragraph (b) above shall be liable for any
damages arising from the use by unintended recipients of any information or
other materials distributed by it through telecommunications, electronic or
other information transmission systems in connection with this Agreement or the
other Loan Documents or the transactions contemplated hereby or thereby.

(e) Each party’s obligations under this Section shall survive the termination of
the Loan Documents and payment of the obligations hereunder. All amounts due
under this Section shall be payable within 10 Business Days after demand
therefor.

SECTION 9.06. Right of Setoff. If an Event of Default shall have occurred and be
continuing, each Lender, each Person of which such Lender is a subsidiary, each
Person which is a subsidiary of such Lender and such Person and its subsidiaries
(collectively, the “Lender Party”) are, in each case, hereby authorized at any
time and from time to time, to the fullest extent permitted by applicable law,
to set off and apply any and all deposits (general or special, time or demand,
provisional or final, in whatever currency) at any time held, and other
obligations (in whatever currency) at any time owing, by such Lender Party, to
or for the credit or the account of the Borrower or Intermediate Holdings
against any and all of the obligations of the Borrower or Intermediate Holdings
now or hereafter existing under this Agreement or any other Loan Document to
such Lender Party, irrespective of whether or not such Lender Party shall have
made any demand under this Agreement or any other Loan Document and although
such obligations of the Borrower or Intermediate Holdings may be contingent or
unmatured or are owed to a branch or office of such Lender Party different from
the branch or office holding such deposit or obligated on such indebtedness. The
rights of each Lender Party under this Section are in addition to other rights
and remedies (including other rights of setoff) that such Lender Party may have.
Each Lender Party agrees to notify the Borrower and the Administrative Agent
promptly after any such setoff and application; provided that the failure to
give such notice shall not affect the validity of such setoff and application.

SECTION 9.07. Applicable Law. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS AND
ANY CLAIMS, CONTROVERSY, DISPUTE OR CAUSE OF ACTION (WHETHER IN CONTRACT OR TORT
OR OTHERWISE) BASED UPON, ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT (EXCEPT, AS TO ANY OTHER LOAN DOCUMENT, AS EXPRESSLY SET
FORTH THEREIN) AND THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

SECTION 9.08. Waivers; Amendment. (a) No failure or delay of the Administrative
Agent, the Collateral Trustee or any Lender in exercising any power or right
hereunder or under any other Loan Document shall operate as a waiver thereof,
nor shall any single or partial exercise of any such right or power, or any
abandonment or discontinuance of steps to enforce such a right or power,
preclude any other or further

 

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exercise thereof or the exercise of any other right or power. The rights and
remedies of the Administrative Agent, the Collateral Trustee and the Lenders
hereunder and under the other Loan Documents are cumulative and are not
exclusive of any rights or remedies that they would otherwise have. No waiver of
any provision of this Agreement or any other Loan Document or consent to any
departure by the Borrower or any other Loan Party therefrom shall in any event
be effective unless the same shall be permitted by paragraph (b) below, and then
such waiver or consent shall be effective only in the specific instance and for
the purpose for which given. No notice or demand on the Borrower or Intermediate
Holdings in any case shall entitle the Borrower or Intermediate Holdings to any
other or further notice or demand in similar or other circumstances.

(b) Neither this Agreement nor any provision hereof may be waived, amended or
modified except pursuant to an agreement or agreements in writing entered into
by the Borrower, Intermediate Holdings and the Required Lenders; provided,
however, that no such agreement shall (i) decrease the principal amount of, or
extend the maturity of or any scheduled principal payment date or date for the
payment of any interest on any Term Loan, or waive or excuse any such payment or
any part thereof, or decrease the rate of interest on any Term Loan, without the
prior written consent of each Lender directly adversely affected
thereby, (ii) increase or extend the Term Loans or decrease or extend the date
for payment of any fees of any Lender without the prior written consent of such
Lender, (iii) amend or modify the pro rata requirements of Section 2.17, the
provisions of Section 9.04(a) or the provisions of this Section or release all
or substantially all of the value of the Guarantees provided by the Subsidiary
Guarantor (other than in connection with the sale of such Subsidiary Guarantor
in a transaction permitted by Section 6.05) or releasing all or substantially
all of the Collateral, without the prior written consent of each
Lender, (iv) change the provisions of any Loan Document in a manner that by its
terms adversely affects the rights of Lenders holding Loans of one Class
differently from the rights of Lenders holding Loans of any other Class without
the prior written consent of Lenders holding a majority in interest of the
outstanding Loans of each adversely affected Class, (v) modify the protections
afforded to an SPV pursuant to the provisions of Section 9.04(i) without the
written consent of such SPV or (vi) amend or modify the definition of the terms
“Required Lenders” or “Supermajority Lenders” without the prior written consent
of each Lender (it being understood that with the consent of the Required
Lenders, additional extensions of credit pursuant to this Agreement may be
included in the determination of the Required Lenders on substantially the same
basis as the Term Loan Commitments on the date hereof); provided, further,
however, that no such agreement shall (w) amend, modify or otherwise affect the
rights or duties of the Administrative Agent or the Collateral Trustee or
hereunder or under any other Loan Document without the prior written consent of
the Administrative Agent or the Collateral Trustee, (x) waive, amend or modify
the provisions of Sections 6.01, 6.02, 6.06, 6.07 or 6.09(a)(ii), (y) amend or
modify the provisions of paragraph (n) of Article VII or the definitions of
“Change of Control”, “Equity Interests”, “Parent”, “Pledge Agreement” or
“Intercreditor Agreement” or (z) amend or modify the first priority ranking
(subject to Liens permitted by Section 6.02) of the Liens on, and security

 

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interest in, the Collateral, in the case of clauses (x), (y) and (z), without
the prior written consent of the Supermajority Lenders.

Notwithstanding anything to the contrary herein, no Affiliated Lender shall have
any right to approve or disapprove any amendment, waiver or consent hereunder or
any plan of reorganization, and all such Term Loans held by such Affiliated
Lender for purposes hereof shall be automatically deemed to be voted pro rata
according to the Term Loans of all other Lenders in the aggregate (other than
any Affiliated Lenders) ; provided, however, that Affiliated Lenders shall have
the right to approve or disapprove any amendment, waiver or consent hereunder or
any plan or reorganization that in either case adversely affects the rights or
obligations of such Affiliated Lender hereunder or under any other Loan Document
in any material respect as compared to other Lenders.

(c) The Administrative Agent and the Borrower may amend any Loan Document to
correct administrative errors or omissions, or to effect administrative changes
that are not adverse to any Lender. Notwithstanding anything to the contrary
contained herein, such amendment shall become effective without any further
consent of any other party to such Loan Document.

SECTION 9.09. Interest Rate Limitation. Notwithstanding anything herein to the
contrary, if at any time the interest rate applicable to any Term Loan, together
with all fees, charges and other amounts which are treated as interest on such
Term Loan under applicable law (collectively the “Charges”), shall exceed the
maximum lawful rate (the “Maximum Rate”) which may be contracted for, charged,
taken, received or reserved by the Lender holding such Term Loan or
participation in accordance with applicable law, the rate of interest payable in
respect of such Term Loan or participation hereunder, together with all Charges
payable in respect thereof, shall be limited to the Maximum Rate and, to the
extent lawful, the interest and Charges that would have been payable in respect
of such Term Loan or participation but were not payable as a result of the
operation of this Section 9.09 shall be cumulated and the interest and Charges
payable to such Lender in respect of other Term Loans or participations or
periods shall be increased (but not above the Maximum Rate therefor) until such
cumulated amount, together with interest thereon at the Federal Funds Effective
Rate to the date of repayment, shall have been received by such Lender.

SECTION 9.10. Entire Agreement. This Agreement and the other Loan Documents, and
any separate letter agreements with respect to fees payable to the
Administrative Agent, constitute the entire contract among the parties relating
to the subject matter hereof and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof. Any
other previous agreement among the parties with respect to the subject matter
hereof is superseded by this Agreement and the other Loan Documents. Nothing in
this Agreement or in the other Loan Documents, expressed or implied, is intended
to confer upon any Person (other than the parties hereto and thereto, their
respective successors and assigns permitted hereunder and, to the extent
expressly contemplated hereby, the Related Parties of each of the Administrative
Agent, the Collateral Trustee and the Lenders) any rights, remedies,

 

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obligations or liabilities under or by reason of this Agreement or the other
Loan Documents.

SECTION 9.11. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER
THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE
BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG
OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.11.

SECTION 9.12. Severability. In the event any one or more of the provisions
contained in this Agreement or in any other Loan Document should be held
invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein and therein shall
not in any way be affected or impaired thereby (it being understood that the
invalidity of a particular provision in a particular jurisdiction shall not in
and of itself affect the validity of such provision in any other jurisdiction).
The parties shall endeavor in good-faith negotiations to replace the invalid,
illegal or unenforceable provisions with valid provisions the economic effect of
which comes as close as possible to that of the invalid, illegal or
unenforceable provisions.

SECTION 9.13. Counterparts; Effectiveness; Electronic Execution. (a) This
Agreement may be executed in counterparts (and by different parties hereto in
different counterparts), each of which shall constitute an original, but all of
which when taken together shall constitute a single contract. Delivery of an
executed counterpart of a signature page of this Agreement by facsimile or in
electronic (i.e., “pdf” or “tif”) format shall be effective as delivery of a
manually executed counterpart of this Agreement.

(b) The words “execution,” “signed,” “signature,” and words of like import in
any Assignment and Assumption shall be deemed to include electronic signatures
or the keeping of records in electronic form, each of which shall be of the same
legal effect, validity or enforceability as a manually executed signature or the
use of a paper-based recordkeeping system, as the case may be, to the extent and
as provided for in any applicable law, including the Federal Electronic
Signatures in Global and National Commerce Act, the New York State Electronic
Signatures and Records Act, or any other similar state laws based on the Uniform
Electronic Transactions Act.

 

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SECTION 9.14. Headings. Article and Section headings and the Table of Contents
used herein are for convenience of reference only, are not part of this
Agreement and are not to affect the construction of, or to be taken into
consideration in interpreting, this Agreement.

SECTION 9.15. Jurisdiction; Consent to Service of Process. (a) Each party hereto
hereby irrevocably and unconditionally submits, for itself and its property, to
the exclusive jurisdiction of any New York State court or Federal court of the
United States of America sitting in New York City, and any appellate court from
any thereof, in any suit, action or proceeding arising out of or relating to
this Agreement, the other Loan Documents or the Transactions, or for recognition
or enforcement of any judgment, and each of the parties hereto hereby
irrevocably and unconditionally agrees that all claims in respect of any such
action, litigation or proceeding may be heard only and determined in such
New York State court or, to the fullest extent permitted by applicable law, in
such Federal court. Each of the parties hereto agrees that a final judgment in
any such action, litigation or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Nothing in this Agreement or in any other Loan Document shall
affect any right that the Administrative Agent or any Lender may otherwise have
to bring any action or proceeding relating to this Agreement or any other Loan
Document against the Borrower or any other Loan Party or its properties in the
courts of any jurisdiction.

(b) The Borrower and each other Loan Party irrevocably and unconditionally
waives, to the fullest extent permitted by applicable law, any objection that it
may now or hereafter have to the laying of venue of any action or proceeding
arising out of or relating to this Agreement or any other Loan Document in any
court referred to in paragraph (a) of this Section. Each of the parties hereto
hereby irrevocably waives, to the fullest extent permitted by applicable law,
the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.

(c) Each party to this Agreement irrevocably consents to service of process in
the manner provided for notices in Section 9.01. Nothing in this Agreement will
affect the right of any party hereto to serve process in any other manner
permitted by applicable law.

SECTION 9.16. Confidentiality. Each of the Agents and the Lenders agrees to
maintain the confidentiality of the Information (as defined below), except that
Information may be disclosed (a) to its Affiliates and to its Related Parties
(it being understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such Information and instructed to keep
such Information confidential); (b) to the extent required or requested by any
regulatory authority purporting to have jurisdiction over such Person or its
Related Parties (including any self-regulatory authority, such as the National
Association of Insurance Commissioners); (c) to the extent required by
applicable laws or regulations or by any subpoena or similar legal process;
(d) to any other party hereto; (e) in connection with the exercise of any
remedies hereunder or under any other Loan Document or any action or proceeding

 

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relating to this Agreement or any other Loan Document or the enforcement of
rights hereunder or thereunder; (f) subject to an agreement containing
provisions substantially the same as (or no less restrictive than) those of this
Section, to (i) any permitted assignee of or Participant in, or any prospective
permitted assignee of or Participant in, any of its rights and obligations under
this Agreement, or (ii) any actual or prospective party (or its Related Parties)
to any swap, derivative or other transaction under which payments are to be made
by reference to the Borrower and its obligations, this Agreement or payments
hereunder; (g) on a confidential basis to (i) any rating agency in connection
with rating the Borrower or its Subsidiaries or the Credit Facilities or
(ii) the CUSIP Service Bureau or any similar agency in connection with the
issuance and monitoring of CUSIP numbers with respect to the Credit Facilities;
(h) with the consent of the Borrower; or (i) to the extent such Information
(x) becomes publicly available other than as a result of a breach of this
Section, or (y) becomes available to any Agent, any Lender, or any of their
respective Affiliates on a nonconfidential basis from a source other than the
Borrower. For the purposes of this Section, “Information” shall mean all
information received from Intermediate Holdings, the Borrower or any of its
Subsidiaries relating to Intermediate Holdings, the Borrower or any of its
Subsidiaries or any of their respective businesses, other than any such
information that is available to the Administrative Agent or any Lender on a
nonconfidential basis prior to disclosure by the Borrower or any of its
Subsidiaries; provided that, in the case of information received from
Intermediate Holdings, the Borrower or any of its Subsidiaries after the date
hereof, such information is clearly identified at the time of delivery as
confidential. Any Person required to maintain the confidentiality of Information
as provided in this Section shall be considered to have complied with its
obligation to do so if such Person has exercised the same degree of care to
maintain the confidentiality of such Information as such Person would accord to
its own confidential information.

SECTION 9.17. Lender Action. Each Lender agrees that it shall not take or
institute any actions or proceedings, judicial or otherwise, for any right or
remedy against any Loan Party or any other obligor under any of the Loan
Documents (including the exercise of any right of setoff, rights on account of
any banker’s lien or similar claim or other rights of self-help), or institute
any actions or proceedings, or otherwise commence any remedial procedures, with
respect to any Collateral or any other property of any such Loan Party, unless
expressly provided for herein or in any other Loan Document, without the prior
written consent of the Administrative Agent. The provisions of this Section 9.17
are for the sole benefit of the Lenders and shall not afford any right to, or
constitute a defense available to, any Loan Party.

SECTION 9.18. USA PATRIOT Act Notice. Each Lender and the Administrative Agent
(for itself and not on behalf of any Lender) hereby notifies Intermediate
Holdings and the Borrower that pursuant to the requirements of the USA PATRIOT
Act, it is required to obtain, verify and record information that identifies the
Borrower and the other Loan Parties, which information includes the name and
address of the Borrower and the other Loan Parties and other information that
will allow such Lender or the Administrative Agent, as applicable, to identify
the Borrower and the other Loan Parties in accordance with the USA PATRIOT Act.

(signature pages follow)

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective authorized officers as of the day and year first
above written.

 

DYNEGY MIDWEST GENERATION, LLC,

as Borrower

By  

/s/ Clint C. Freeland

  Name: Clint C. Freeland  

Title: Executive Vice President and

Chief Financial Officer

DYNEGY COAL INVESTMENTS HOLDINGS, LLC,

as Intermediate Holdings

By  

/s/ Clint S. Freeland

  Name: Clint C. Freeland  

Title: Executive Vice President and

Chief Financial Officer

 

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CREDIT SUISSE AG, Cayman Islands

Branch, individually as Lender and as

Administrative Agent and Collateral Trustee

by  

/s/ James Moran

  Name: James Moran   Title: Managing Director by  

/s/ Nupur Kumar

  Name: Nupur Kumar   Title: Vice President

 

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CREDIT SUISSE SECURITIES (USA) LLC,

as a Joint Lead Arranger

by  

/s/ James S. Finch

  Name: James S. Finch   Title: Managing Director

 

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GOLDMAN SACHS LENDING PARTNERS LLC,

as a Joint Lead Arranger

by  

/s/ Sridharan Kannan

  Name: Sridharan Kannan   Title: Authorized Signatory

 

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BARCLAYS CAPITAL, the Investment

Banking Division of Barclays Bank PLC,

as Co-Manager

by  

/s/ Ann E. Sutton

  Name: Ann E. Sutton   Title: Director

 

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SCHEDULE 1.01(A)

SUBSIDIARY GUARANTORS

 

1. HAVANA DOCK ENTERPRISES, LLC

 

SCHEDULE 1.01(a)

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

SCHEDULE 1.01(B)

MORTGAGED PROPERTY

 

    

Property

  

State

  

Mortgagor

1.

  

BALDWIN

10901 Baldwin Road,

Baldwin, IL 62217

   IL    Dynegy Midwest Generation, LLC    Randolph County and St. Clair County,
Illinois      

2.

  

HAVANA

15260 State Route 78,

Havana, IL 62644

   IL    Dynegy Midwest Generation, LLC    Mason County, IL      

3.

  

HENNEPIN

13498 E 800th St,

Hennepin, IL 61327

   IL    Dynegy Midwest Generation, LLC    Putnam County, IL      

4.

  

OGLESBY

Illinois Highway 351 and 71 a/k/a

445 S. Columbia

   IL    Dynegy Midwest Generation, LLC

 

SCHEDULE 1.01(b)

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

    

Property

  

State

  

Mortgagor

  

Oglesby, IL 61348

LaSalle County

     

5.

  

STALLINGS

4601 State Route 162,

Granite City, IL 62040

 

WOOD RIVER

1 Chessen Lane,

Alton, IL 62002

 

Madison County, IL

   IL    Dynegy Midwest Generation, LLC

6.

  

HAVANA DOCK

17819 Manito Road

Havana, IL 62644

 

Mason County, IL

   IL    Havana Dock Enterprises, LLC

7.

  

VERMILION

10188 East 2150 North Rd.,

Oakwood, IL 61858

 

Vermilion County, Illinois

   IL    Dynegy Midwest Generation, LLC

 

SCHEDULE 1.01(b)

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

SCHEDULE 1.01(C)

EXCLUDED OBLIGATIONS

None.

 

SCHEDULE 1.01(c)

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

SCHEDULE 2.01

LENDERS AND TERM LOAN COMMITMENTS

 

Lender

 

Term Loan Commitment

Credit Suisse, Cayman Islands Branch

  $276,000,000

Goldman Sachs Lending Partners LLC

  $264,000,000

Barclays Bank PLC

  $60,000,000

Total:

  $600,000,000

 

SCHEDULE 2.01

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

SCHEDULE 3.07

RIGHTS OF FIRST REFUSAL AND OPTIONS WITH

RESPECT TO MORTGAGED PROPERTIES

 

1. RIGHT OF FIRST REFUSAL ALLEGED BY MR. DON KOSTELLIC TO PURCHASE WEST 40 ACRES
OF THE EAST HALF OF THE SOUTHEAST QUARTER OF SECTION 11, T32N, R2W, PUTNAM
COUNTY, ILLINOIS (HENNEPIN CLAY PIT).

 

SCHEDULE 3.07

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

SCHEDULE 3.08

SUBSIDIARIES

 

Subsidiaries

  

Entity Interest Held By

   Percentage
of Equity Held   Havana Dock Enterprises, LLC (Delaware LLC)   

Dynegy Midwest Generation,

LLC (Delaware LLC)

     100 %

 

SCHEDULE 3.08

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

SCHEDULE 3.09

LITIGATION

 

1. Prairie State Arbitration/KRPD Litigation – Dynegy Midwest Generation, LLC is
a respondent in arbitration filed by Randolph Land Holdings Co., LLC and Prairie
State Generation Co., Inc. Randolph and Prairie State claim they are entitled to
access Dynegy Midwest Generation, LLC’s private rail line servicing the Baldwin
Energy Complex under a Trackage Rights Agreement assigned to Randolph by Peabody
Coal Company. Similarly, the Kaskaskia Port River Dock claims rights to access
Dynegy Midwest Generation, LLC’s private line and filed litigation against
Dynegy Midwest Generation, LLC in St. Clair County, Illinois to declare those
rights. An adverse decision could lead to operational difficulties related to
the future use of the rail line, but we are not able to predict the magnitude of
any such difficulties or their financial impact, if any.

 

2. Libertyview/PSEG Litigation – On July 21, 2011, the following two lawsuits
were filed against Dynegy Holdings Inc. (“DHI”) challenging the proposed
reorganization: (i) Libertyview Credit Opportunities Fund, L.P. et al v. Dynegy
Holdings, Inc., (Index No. 651998/11) in Supreme Court of the State of New York
(the “New York Action”) and (ii) Roseton OL, LLC and Danskammer OL, LLC v.
Dynegy Holdings, Inc., (C.A. No. 6689-VCP) in the Court of Chancery of the State
of Delaware (the “Delaware Action”). Both lawsuits seek to enjoin the proposed
reorganization based on purported breaches of guarantees issued by DHI in
connection with two sale lease back transactions in which DHI’s subsidiaries,
Dynegy Roseton, L.L.C. and Dynegy Danskammer, L.L.C., leased certain
power-generating facilities located in Newburgh, New York. The New York Action
was stayed in favor of the Delaware Action. The plaintiffs in the Delaware
Action filed a motion for a temporary restraining order (“TRO”) to enjoin the
Reorganization on July 21, 2011. DHI opposed the motion by arguing, among other
things, that the unambiguous language of the Guaranties expressly permits the
reorganization. On July 29, 2011, the Delaware court denied the TRO in the
Delaware Action, finding that plaintiffs had failed to show a likelihood of
success on the merits, irreparable harm or that the balancing of the equities
favored them. On July 31, 2011, plaintiffs in the Delaware Action filed an
application for certification of an interlocutory appeal of the court’s order,
as well as a motion for an injunction pending appeal and a motion to expedite
the proceedings, and on August 1, 2011, the court entered an order expediting
DHI’s response to the plaintiffs’ application for a certification of the
interlocutory order. On August 4, 2011, the Court of Chancery denied plaintiffs’
application to certify an interlocutory appeal and motion for an injunction
pending appeal. The Delaware plaintiffs made an application to the Supreme Court
of Delaware for certification of an interlocutory appeal and for an injunction
pending appeal. DHI’s response is due August 5, 2011.

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

SCHEDULE 3.17

ENVIRONMENTAL MATTERS

1. In March and April 2009, the Illinois Environmental Protection Agency
(“IEPA”) initiated groundwater investigations at Baldwin, Havana, Hennepin,
Vermilion and Wood River related to potential groundwater contamination from ash
management facilities. The investigations involve assessing groundwater
hydrology at the facilities, conducting water supply well surveys within 2,500
feet of the ash ponds, evaluation of the monitoring well systems being used, and
evaluation of groundwater sampling results. Based on the investigations, IEPA
has determined that Havana, Hennepin and Wood River do not appear to pose a
threat to groundwater use offsite. The investigations at Baldwin and Vermilion
are ongoing.

 

SCHEDULE 3.17

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

SCHEDULE 3.19(A)

UCC FILING OFFICES

 

1. DELAWARE SECRETARY OF STATE.

 

2. ILLINOIS SECRETARY OF STATE.

 

SCHEDULE 3.19(a)

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

SCHEDULE 3.19(C)

MORTGAGE FILING OFFICES

 

        

Property

  

Filing Office

      

1.

  

BALDWIN

10901 Baldwin Road,

Baldwin, IL 62217

  

County Clerk and Recorder,

Randolph County

 

St. Clair County Recorder

       

Randolph County and St. Clair

County, Illinois

       

2.

   HAVANA    Mason County Recorder        

15260 State Route 78, Havana,

IL 62644

           Mason County, IL        

3.

  

HAVANA DOCK

17819 Manito Road

Havana, IL 62644

   Mason County Recorder         Mason County, IL        

4.

  

HENNEPIN

13498 E 800th St, Hennepin,

IL 61327

   Putnam County Recorder         Putnam County, IL        

5.

  

OGLESBY

Illinois Highway 351 and 71

   LaSalle County Recorder   

 

SCHEDULE 3.19(c)

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

        

Property

  

Filing Office

         

a/k/a

445 S. Columbia

Oglesby, IL 61348

LaSalle County

       

6.

  

STALLINGS

4601 State Route 162,

Granite City, IL 62040

   Madison County Recorder        

WOOD RIVER

1 Chessen Lane

Alton, IL 62002

 

Madison County, IL

       

7.

  

VERMILION

10188 East 2150 North Rd.,

Oakwood, IL 61858,

 

Vermilion County

   Vermilion County Recorder   

 

SCHEDULE 3.19(c)

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

SCHEDULE 3.20

PART A – OWNED REAL PROPERTY

1. BALDWIN: Dynegy Midwest Generation, LLC, a Delaware limited liability
company – Randolph County and St. Clair County, Illinois

2. HAVANA: Dynegy Midwest Generation, LLC, a Delaware limited liability
company – Mason County, Illinois

3. HAVANA DOCK: Havana Dock Enterprises, LLC, a Delaware limited liability
company – Mason County, Illinois

4. HENNEPIN: Dynegy Midwest Generation, LLC, a Delaware limited liability
company – Putnam County, Illinois

5. OGLESBY: Dynegy Midwest Generation, LLC, a Delaware limited liability company
– LaSalle County, Illinois

6. STALLINGS: Dynegy Midwest Generation, LLC, a Delaware limited liability
company – Madison County, Illinois

7. VERMILION: Dynegy Midwest Generation, LLC, a Delaware limited liability
company – Vermilion County, Illinois

8. WOOD RIVER: Dynegy Midwest Generation, LLC, a Delaware limited liability
company – Madison County, Illinois

PART B – LEASED REAL PROPERTY

None.

 

SCHEDULE 3.20

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

SCHEDULE 3.28

DEPOSIT ACCOUNTS AND SECURITIES ACCOUNTS

Deposit Accounts:

 

Grantor/ Holder

  

Depositary Institution and Address

   Account
Number
Dynegy Coal
Investments Holdings,
LLC       Dynegy Midwest
Generation, LLC      

SECURITY ACCOUNTS:

None.

 

SCHEDULE 3.28

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

SCHEDULE 3.30

PERMITS

1. Dynegy Midwest Generation, LLC Appeal of Title V Permits and Construction
Permits – The Illinois Environmental Protection Agency (“IEPA”) issued operating
permits under Title V of the Clean Air Act Amendments of 1990 to all Illinois
coal-fired power plants, including Baldwin, Havana, Hennepin, Vermilion and Wood
River, in 2005. The owners/operators of the affected coal-fired power plants,
including Dynegy Midwest Generation, LLC, appealed their respective Title V
permits to the Illinois Pollution Control Board (“IPCB”). The IPCB has stayed
each of the Dynegy Midwest Generation, LLC’s permits in their entirety. No
significant activity on these appeals has occurred since they were filed. In
late 2009 the Illinois Attorney General assumed the defense of the Title V
permits. Since 2005, the IEPA has also issued several construction permits for
installation of various emission control equipment required to be installed at
Dynegy Midwest Generation, LLC’s plants under the Consent Decree or the IEPA
Multi-Pollutant Standards. Dynegy Midwest Generation, LLC appealed several of
these construction permits to the IPCB and the IPCB has stayed various
provisions of each of these appealed permits. No significant action has occurred
since the appeals were filed. The appeals are:

 

  •  

Dynegy Midwest Generation, Inc. (Baldwin Energy Complex) v. Illinois
Environmental Protection Agency, PCB 06-063

 

  •  

Dynegy Midwest Generation, Inc. (Baldwin Energy Complex) v. Illinois
Environmental Protection Agency, PCB 08-066

 

  •  

Dynegy Midwest Generation, Inc. (Baldwin Energy Complex) v. Illinois
Environmental Protection Agency, PCB 09-009

 

  •  

Dynegy Midwest Generation, Inc. (Havana Power Station) v. Illinois Environmental
Protection Agency, PCB 07-115

 

  •  

Dynegy Midwest Generation, Inc. (Havana Power Station) v. Illinois Environmental
Protection Agency, PCB 06-071

 

  •  

Dynegy Midwest Generation, Inc. (Hennepin Power Station) v. Illinois
Environmental Protection Agency, PCB 07-123

 

  •  

Dynegy Midwest Generation, Inc. (Vermilion Power Station) v. Illinois
Environmental Protection Agency, PCB 06-194

 

  •  

Dynegy Midwest Generation, Inc. (Vermilion Power Station) v. Illinois
Environmental Protection Agency, PCB 06-073

 

  •  

Dynegy Midwest Generation, Inc. (Wood River Power Station) v. Illinois
Environmental Protection Agency, PCB 09-006

 

  •  

Dynegy Midwest Generation, Inc. (Wood River Power Station) v. Illinois
Environmental Protection Agency, PCB 07-074

 

  •  

Dynegy Midwest Generation, Inc. (Wood River Power Station) v. Illinois
Environmental Protection Agency, PCB 06-072

 

SCHEDULE 3.30

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

SCHEDULE 4(A)

LOCAL COUNSEL

PART (A) (CORPORATE)

DELAWARE

Richards, Layton & Finger

ILLINOIS

Shiff Hardin LLP

PART (B) (REAL ESTATE)

ILLINOIS

Vedder, Price, Kaufman & Kammholz

 

SCHEDULE 4.20(a)

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

SCHEDULE 6.01

EXISTING INDEBTEDNESS

None.

 

SCHEDULE 6.01

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

SCHEDULE 6.02

EXISTING LIENS

 

Entity

 

Jurisdiction

 

UCCs

   

Secured Party

 

Description of UCC Financing Statement

 

File number and date

Dynegy Coal Investments Holdings, LLC   DE – SOS   Clear     Dynegy Midwest
Generation, LLC (fka Dynegy Midwest Generation, Inc.)   IL – UCC  
PNC Bank, National Association HeadCo Industries, Inc.  
Bearing & Power transmission products held by Debtor in inventory as consignee
from Secured Party, as consignor.   12344406 FS 07-27-07     Interstate Bank  

Equipment

Assignment from Industrial Water Solutions, Inc.

Assignment from Leasing Innovations, Incorporated

 

15135638 FS 03-29-10

09054787 AS 07-21-10

 

09061437 AS 08-17-10

Havana Dock Enterprises, LLC   DE – SOS   Clear    

 

SCHEDULE 6.02

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

SCHEDULE 6.10(A)

PERMITTED CAPITAL EXPENDITURES

Capital Expenditures in (i) any fiscal year, commencing from the Closing Date,
in an amount not to exceed $65,000,000 plus (ii) an additional amount made in
connection with the Consent Decree, dated May 27, 2005 regarding Civil Action
No. 99-833-MJR, the United States of America v. Illinois Power Company and
Dynegy Midwest Generation, Inc. in the United States District Court for the
Southern District of Illinois, which shall not exceed, at any time during the
term of this Agreement, an aggregate amount of $175,000,000.

 

SCHEDULE 6.10(a)

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

SCHEDULE 6.10(D)

ENVIRONMENTAL CAPITAL EXPENDITURES

AND PROPOSED LEGISLATION

 

1. Greenhouse Gases (“GHG”)

 

  A. Federal

a. Federal Legislation regarding GHG. Since 2003 several bills have been
introduced in Congress that, if passed, would compel reductions in CO2 (and/or
GHG) emissions from power plants. Future enactment of federal legislation
requiring GHG emission reductions from power plants remains possible.

b. Federal Regulation of GHG.

(i) Prevention of Significant Deterioration (“PSD”). On June 3, 2010 (75 Fed.
Reg. 31514), the U.S. Environmental Protection Agency (“EPA”) issued a rule to
“phase in” new GHG emissions applicability thresholds for the PSD permit program
and the Title V operating permit program (the “GHG Tailoring Rule”). Application
of the PSD program to GHG emissions will require implementation of best
available control technology (“BACT”) for new and modified sources of GHG.
States also have taken, are taking, or may take regulatory action to incorporate
the federal GHG Tailoring Rule requirements into state air permit programs.

(ii) GHG NSPS/Emission Guidelines. On December 30, 2010, the EPA published a
Notice of Proposed Settlement Agreement of a CAA citizen suit in New York, et
al. v. EPA, a challenge to its 2006 final new source performance standards
(“NSPS”) for electric utility steam generating units (“EGUs”), which did not
establish standards of performance for GHG emissions. The settlement, as
subsequently modified, requires the EPA to issue a proposed NSPS for control of
GHG emissions from new and modified EGUs, as well as proposed emission
guidelines for control of GHG emissions from existing EGUs, by September 30,
2011 and to finalize the standards by May 26, 2012.

 

  B. State

Many states have considered, will consider, are considering, or are in some
stage of implementing state-only (including regional) requirements intended to
reduce emissions of GHGs from stationary sources, including power plants, as a
means of addressing climate change. Any state in which one of our electric
generating facilities operates may in the future impose GHG emission reduction
requirements. Examples of state GHG regulatory efforts affecting our generating
facilities include, but are not limited, to the following.

a. Regional Greenhouse Gas Initiative (“RGGI”). On January 1, 2009, our assets
in New York and Maine became subject to a state-driven GHG emission control
program known as RGGI. RGGI was developed and implemented by ten New England and
Mid-Atlantic states to reduce CO2 emissions from power plants. The participating
RGGI

 

SCHEDULE 6.10(d)

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

states implemented rules regulating GHG emissions using a cap-and-trade program
to reduce CO2 emissions by at least 10 percent of 2009 emission levels by the
year 2018. Compliance is measured across a three-year control period. The first
control period is for the 2009-2011 timeframe.

b. Midwest Greenhouse Gas Accord (“MGGA”). Our assets in Illinois may become
subject to a regional GHG cap and trade program being developed under the MGGA,
an agreement among six states and one Canadian province to create the Midwestern
Greenhouse Reduction Program to establish GHG reduction targets and timeframes
consistent with member states’ targets and to develop a market-based and
multi-sector cap and trade mechanism to achieve the GHG reduction targets.
Illinois has set a goal of reducing GHG emissions to 1990 levels by the year
2020, and to 60 percent below 1990 levels by 2050.

2. Cross-State Air Pollution Rule. On July 6, 2011, the EPA issued its final
rule on Federal Implementation Plans (“FIPs”) to Reduce Interstate Transport of
Fine Particulate Matter and Ozone (the “Cross-State Air Pollution Rule”,
formerly known as the Transport Rule). The rule imposes cap and trade programs
within each affected state (including Illinois, New York and Pennsylvania) that
cap emissions of SO2 (annual) and NOx (annual and ozone season) at levels to
eliminate that state’s contribution to nonattainment in, or interference with
maintenance of attainment status by, down-wind areas with respect to the
National Ambient Air Quality Standards (“NAAQS”) for particulate matter (PM2.5)
and ozone. The rule will be implemented initially through FIPs that are
effective in each affected state 60 days after the rule is published in the
Federal Register. States have the option of developing SIPs to implement CSAPR.
Requirements applicable to NOx emissions require compliance with the annual NOx
reductions beginning January 1, 2012 and ozone season NOx reductions beginning
May 1, 2012. The requirements applicable to SO2 emissions from electric
generating units in Illinois, New York and Pennsylvania will be implemented in
two stages with compliance dates of January 1, 2012 and January 1, 2014.

3. Transport Rule to Address 2011 Ozone Standards. The EPA intends to develop an
additional cross-state air pollution/interstate transport rule to require
further emission reductions as related to the upcoming revised ozone NAAQS. On
January 19, 2010 (75 Fed. Reg. 2938), the EPA proposed revisions to the ozone
NAAQS, which are expected to be finalized in 2011. Additional reductions and/or
transport rules to address the particulate matter NAAQS may also be imposed in
this or other rulemakings.

4. Mercury/Hazardous Air Pollutants (“HAPs”). In December 2006, the Illinois
Pollution Control Board approved a state rule for the control of mercury
emissions from coal-fired power plants beginning in 2009. On May 3, 2011 (76
Fed. Reg. 24976), the EPA issued a proposed rule to establish maximum achievable
control technology (“MACT”) emission standards for HAPs (including but not
limited to mercury) at coal- and oil-fired electric generating units. Compliance
would be required within three years after the effective date of the final rule,
unless an extension is granted in accordance with the Clean Air Act. Under a
consent decree, the EPA is required to issue final standards by November 16,
2011.

 

SCHEDULE 6.10(d)

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

5. Coal Combustion Residuals. On June 21, 2010 (75 Fed. Reg. 35128), the EPA
proposed two alternative rules under the Resource Conservation and Recovery Act
(“RCRA”) for federal regulation of the management and disposal of Coal
Combustion Residuals (“CCR”) from electric utilities and independent power
producers. One proposal would regulate CCR as a special waste under RCRA
subtitle C rules when those wastes are destined for disposal in a landfill or
surface impoundment. The subtitle C proposal would subject persons who generate,
transport, treat, store or dispose of such CCR to many of the existing RCRA
regulations applicable to hazardous waste. Certain types of beneficial use of
CCR would be exempt from regulation under the subtitle C proposal. Regulation
under subtitle C would effectively phase out the use of ash ponds for disposal
of CCR. The second alternative proposal would regulate CCR disposed in landfills
or surface impoundments as a solid waste under subtitle D of RCRA. The subtitle
D proposal would establish national criteria for disposal of CCR in landfills
and surface impoundments, requiring new units to install composite liners. The
subtitle D proposal might also require existing surface impoundments without
liners to close or be retrofitted with composite liners within five years.
Federal legislation to address CCR also has been introduced in Congress. For
example, on July 13, 2011, the House Energy and Commerce Committee approved H.R.
2273, the Coal Residuals Reuse and Management Act, which would authorize the
states to implement a RCRA subtitle D permit program for CCR disposal units,
including requirements for, among other things, certain elements of the subtitle
D criteria for municipal solid waste landfills (e.g., design standards, closure
and post-closure care).

6. Steam Electric Power Generating Effluent Guidelines. Under a settlement
agreement, the EPA would be required to propose revisions to the Effluent
Guidelines for steam electric units (40 C.F.R. Part 423) by July 23, 2012 and to
take final action on the proposal by January 31, 2014.

7. Cooling Water Intake Structures. On April 20, 2011 (76 Fed. Reg. 22174), the
EPA issued a proposed rule under CWA section 316(b) for cooling water intake
structures at existing facilities. The proposed rule would establish impingement
mortality and entrainment standards and related requirements. Under a settlement
agreement, the EPA will finalize the rule in July 2012.

8. On June 2, 2011, the Illinois Environmental Protection Agency (“IEPA”) sent
its area designation recommendations to the EPA for the new 1-hour SO2
NAAQS. The areas proposed as nonattainment include the township where the Wood
River power station is located. The EPA has not yet concurred with the proposed
nonattainment recommendation and the IEPA has not yet determined what SO2
control measures would be required to achieve attainment or which sources would
need to implement them.

9. On June 24, 2011, the IEPA submitted its Regional Haze and Best Available
Retrofit Technology (“BART”) SIP to the EPA for approval. The only Dynegy
Midwest Generation, Inc. units subject to the BART review were Baldwin Unit 3
and Wood River Unit 5. Because those units are covered by the Illinois
multi-pollutant standards rule, no additional emission reductions are expected
to be required.

 

SCHEDULE 6.10(d)

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

10. The EPA has proposed “Guidance Regarding Identification of Waters Protected
by the Clean Water Act”, 76 Fed. Reg. 24479 (May 2, 2011). While adoption of the
guidance would not itself impose any new material environmental burdens on
facilities of Dynegy Coal Investments Holdings, LLC and its subsidiaries, it may
result in our facilities becoming subject to Corps of Engineers and Illinois
Department of Natural Resources regulatory requirements.

11. Without limitation, any state, local or regional legislation or regulation
related to or arising out of any one of items 1-10 above that becomes any
Environmental Law.

 

SCHEDULE 6.10(d)

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

Exhibit A

to the Credit Agreement

ADMINISTRATIVE QUESTIONNAIRE

 

I. Borrower Name:    DYNEGY MIDWEST GENERATION, LLC II. Legal Name of Lender for
Signature Page:    III. Name of Lender for any eventual tombstone:    IV. Legal
Address:   

V. Contact Information:

 

   

Credit Contact

 

Operations
Contact

 

Legal Counsel

Name:

       

 

 

 

 

 

Title:

       

 

 

 

 

 

Address:

       

 

 

 

 

 

       

 

 

 

 

 

Telephone:

       

 

 

 

 

 

Facsimile:

       

 

 

 

 

 

Email: Address:

       

 

 

 

 

 

VI. Lender’s Wire Payment Instructions:

 

Pay to:

        

 

  

(Name of Lender)

 

     

 

  

(ABA#)

 

  

(City/State)

 

  

 

   (Account #)    (Account Name)

Please return this form, by fax, to the attention of Administrative Agent, fax
(212) 322-2291, no later than 5:00 p.m. New York City time, on
[                    ], 2011.

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

Exhibit A

to the Credit Agreement

Administrative Questionnaire

 

Borrower Name:   DYNEGY MIDWEST GENERATION, LLC VII. Organizational Structure:  
Foreign Branch, organized under which laws etc.  

 

Lender’s Tax ID:  

 

Tax withholding Form Attached (For Foreign Buyers)

 

[___]

   Form W-9

[___]

   Form W-8BEN/W-8ECI

[___]

   Form 4224 effective: ____________________

[___]

   Form 1001

[___]

   W/Hold         % Effective ________________

[___]

   Form 4224 on file with Administrative Agent from previous year’s transaction
___________

VIII. Payment Instructions:

Servicing Site:

Pay To:

 

IX. Name of Authorized Officer:  

 

 

Name:

 

 

 

Signature:

 

 

 

Date:

 

 

 

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

Exhibit A

to the Credit Agreement

Administrative Questionnaire

 

X. Institutional Investor Sub-Allocations Institution Legal Name:   

 

Fund Manager:   

 

Sub-Allocations:            

Exact Legal
Name

(for
documentation
purposes)

  

Sub-
Allocation
(Indicate
US$)

  

Direct Signer to
Credit
Agreement

(Yes / No)

  

Purchase by
Assignment
(Yes / No)

  

Date of Post
Closing
Assignment

1.

           

 

  

 

  

 

  

 

  

 

2.

           

 

  

 

  

 

  

 

  

 

3.

           

 

  

 

  

 

  

 

  

 

4.

           

 

  

 

  

 

  

 

  

 

5.

           

 

  

 

  

 

  

 

  

 

6.

           

 

  

 

  

 

  

 

  

 

7.

           

 

  

 

  

 

  

 

  

 

Total

           

Special Instructions

 

 

 

 

 

 

 

 

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

Exhibit B

to the Credit Agreement

FORM OF ASSIGNMENT AND ASSUMPTION

This Assignment and Assumption Agreement (the “Assignment”) is dated as of the
Effective Date set forth below and is entered into by and between [Insert name
of Assignor] (the “Assignor”) and [Insert name of Assignee] (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 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
Administrative Agent as contemplated below, the interest in and to all of the
Assignor’s rights and obligations under the Credit Agreement and any other
documents or instruments delivered pursuant thereto that represents the amount
and percentage interest identified below of all of the Assignor’s outstanding
rights and obligations under the respective facilities identified below (the
“Assigned Interest”). Such sale and assignment is without recourse to the
Assignor and, except as expressly provided in this Assignment, without
representation or warranty by the Assignor.

 

1.

   Assignor:   

2.

   Assignee:                                                              is
a[n] [Affiliate/Eligible Assignee/Related Fund]1

3.

   Borrower:    Dynegy Midwest Generation, LLC, a Delaware limited liability
company

4.

   Administrative Agent:    Credit Suisse AG, Cayman Islands Branch, as
Administrative Agent under the Credit Agreement

5.

   Credit Agreement    The Credit Agreement dated as of August 5, 2011, among
the Borrower, Dynegy Coal Investments Holdings, LLC, a Delaware limited
liability company, the Lenders, the Administrative Agent, Credit Suisse AG,
Cayman Islands Branch as collateral trustee for the Secured Parties, Credit
Suisse Securities (USA) LLC and Goldman Sachs Lending Partners LLC, as Joint
Bookrunners and Joint Lead Arrangers, and Credit Suisse Securities (USA) LLC and
Goldman Sachs Lending Partners LLC, as Joint Syndication Agents and
Co-Documentation Agents.

 

1 

Select as applicable.

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

Exhibit B

to the Credit Agreement

 

6. Assigned Interest:

 

Aggregate
Amount of Loans for all
Lenders

  

Amount of Loans

Assigned

  

Percentage
Assigned of Loans2

$            

   $                                            %

(Signature page follows)

 

 

2 

Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans of
all Lenders thereunder.

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

Exhibit B

to the Credit Agreement

Effective Date:                      , 20     [TO BE INSERTED BY ADMINISTRATIVE
AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE
REGISTER THEREFOR.]

The terms set forth in this Assignment are hereby agreed to:

 

ASSIGNOR [NAME OF ASSIGNOR] By:  

 

  Name:   Title:

 

ASSIGNEE [NAME OF ASSIGNEE] By:  

 

  Name:   Title:

Consented to and Accepted:

CREDIT SUISSE AG,

CAYMAN ISLANDS BRANCH,

as Administrative Agent

 

By:  

 

  Name:   Title:

 

By:  

 

  Name:   Title:

[Consented to:

DYNEGY MIDWEST GENERATION, LLC

 

By:  

 

  Name:   Title:]3

 

3 

If required pursuant to Section 9.04(b) of the Credit Agreement

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

Exhibit B

to the Credit Agreement

ANNEX 1

DYNEGY MIDWEST GENERATION, LLC

TERM LOAN CREDIT AGREEMENT

STANDARD TERMS AND CONDITIONS FOR ASSIGNMENT

AND ACCEPTANCE AGREEMENT

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 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 any Loan Document, (ii) the
execution, legality, validity, enforceability, genuineness, sufficiency or value
of the Credit Agreement or any other instrument or document delivered pursuant
thereto, other than this Assignment (herein collectively the “Loan Documents”),
or any collateral thereunder, (iii) the financial condition of 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 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 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, (iii) from and after the Effective
Date, it shall be bound by the provisions of the Credit Agreement 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 5.04 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 to purchase the Assigned Interest on the basis of which
it has made such analysis and decision, (v) if it is a Foreign Lender, attached
to the Assignment 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 (vi) if it is an Affiliated Lender, has complied with the
provisions of Section 2.12(e)(ii) applicable to it; and (b) agrees that (i) it
will, independently and without reliance on Administrative 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.

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

Exhibit B

to the Credit Agreement

 

2. Payments. From and after the Effective Date, Administrative Agent shall make
all payments in respect of the Assigned Interest (including payments of
principal, 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 shall be binding upon, and inure to the
benefit of, the parties hereto and their respective successors and assigns. This
Assignment 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 by telecopy shall be effective as delivery of a manually
executed counterpart of this Assignment. THIS AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND
GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.

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

Exhibit C

to the Credit Agreement

 

FORM OF BORROWING REQUEST

of

DYNEGY MIDWEST GENERATION, LLC

Credit Suisse AG, Cayman Islands Branch, as

Administrative Agent for the Lenders

referred to below,

Eleven Madison Avenue

New York, NY 10010

Attention of [            ]

[Date]            

Ladies and Gentlemen:

The undersigned, Dynegy Midwest Generation, LLC, a Delaware limited liability
company (the “Borrower”), refers to that certain Credit Agreement, dated as of
August 5, 2011, among the Borrower, DYNEGY COAL INVESTMENTS HOLDINGS, LLC, a
Delaware limited liability company (“Intermediate Holdings”), the lenders from
time to time party thereto (the “Lenders”), CREDIT SUISSE AG, CAYMAN ISLANDS
BRANCH as administrative agent (in such capacity, including any successor
thereto, the “Administrative Agent”) and as collateral trustee (in such
capacity, including any successor thereto, the “Collateral Trustee”) for the
Lenders, CREDIT SUISSE SECURITIES (USA) LLC and GOLDMAN SACHS LENDING PARTNERS
LLC, as Joint Bookrunners and Joint Lead Arrangers (collectively, the “Joint
Lead Arrangers”) and CREDIT SUISSE SECURITIES (USA) LLC and GOLDMAN SACHS
LENDING PARTNERS, LLC, as Joint Syndication Agents and Co-Documentation Agents.
Capitalized terms used herein and not otherwise defined herein shall have the
meanings assigned to such terms in the Credit Agreement. The Borrower hereby
gives you notice pursuant to Section 2.03 of the Credit Agreement that it
requests a Borrowing under the Credit Agreement, and in connection therewith
sets forth below the terms on which such Borrowing is requested to be made:

 

(A)  

Date of Borrowing

(which is a Business Day)

  

 

(B)   Principal Amount of Borrowing   

 

(C)   Type of Borrowing1   

 

(D)   Interest Period and the last day   

 

1 

Specify Eurodollar Borrowing or ABR Borrowing. If no election is specified, the
Borrowing shall be an ABR Borrowing.

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

Exhibit C

to the Credit Agreement

 

thereof2

     

 

  

 

(E) Funds are requested to be disbursed to the Borrower’s account with
                    

   (Account No.                     ).

The Borrower hereby represents and warrants to the Administrative Agent and the
Lenders that, on the date of this Borrowing Request and on the date of the
related Borrowing, the conditions to lending specified in paragraphs (y) and
(z) of Article IV of the Credit Agreement have been satisfied.

(Signature page follows)

 

2 

Applicable only for Eurodollar Borrowings and shall be subject to the definition
of “Interest Period” and Section 2.02 of the Credit Agreement and end not later
than the Maturity Date. If no election is specified for Eurodollar Borrowings,
the Interest Period shall be one month.

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

Exhibit C

to the Credit Agreement

 

DYNEGY MIDWEST GENERATION, LLC By:  

 

  Name:   Title:

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

Exhibit D

to the Credit Agreement

FORM OF GUARANTEE AND COLLATERAL AGREEMENT

(See Exhibit 10.3 of Dynegy’s Current Report on Form 8-K, filed August 8, 2011)

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

Exhibit E

to the Credit Agreement

MORTGAGE, SECURITY AGREEMENT, ASSIGNMENT OF RENTS AND LEASES,

FINANCING STATEMENT AND FIXTURE FILING

by and from

[                    ], “Mortgagor”

to

CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH,

as Collateral Trustee, as “Mortgagee”,

Dated as of August     , 2011

County: [                    ]

State: [                    ]

THE SECURED PARTY (MORTGAGEE) DESIRES THIS FIXTURE FILING

TO BE INDEXED AGAINST THE RECORD OWNER OF THE REAL ESTATE

DESCRIBED HEREIN

PREPARED BY, RECORDING REQUESTED BY,

AND WHEN RECORDED MAIL TO:

Latham & Watkins LLP

885 Third Avenue

New York, NY 10022

Attention: Delilah Iovino

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

Exhibit E

to Credit Agreement

 

MORTGAGE, SECURITY AGREEMENT, ASSIGNMENT OF RENTS AND LEASES, FINANCING
STATEMENT AND FIXTURE FILING

THIS MORTGAGE, SECURITY AGREEMENT, ASSIGNMENT OF RENTS AND LEASES, FINANCING
STATEMENT AND FIXTURE FILING (this “Mortgage”) is dated as of August     , 2011,
by and from [                    ], a [                    ] (“Mortgagor”),
whose address is c/o [                    ] to Credit Suisse AG, Cayman Islands
Branch, the Cayman Islands Branch of a bank organized and existing under the
laws of Switzerland, not in its individual capacity but solely as Collateral
Trustee (in such capacity, “Collateral Trustee”) for the benefit of the Secured
Parties, each as defined in the Intercreditor Agreement referenced below, having
an address at 11 Madison Avenue, New York New York 10010 (Collateral Trustee,
together with its successors and assigns in such capacity, “Mortgagee”).

ARTICLE I

DEFINITIONS

Section 1.1 Definitions. All capitalized terms used herein without definition
shall have the respective meanings ascribed to them in the Intercreditor
Agreement. As used herein, the following terms shall have the following
meanings:

(a) “Intercreditor Agreement”: That certain Collateral Trust and Intercreditor
Agreement, dated as of August     , 2011, as the same may be amended, amended
and restated, supplemented or otherwise modified from time to time, by and among
Dynegy Midwest Generation, LLC, a Delaware limited liability company (the
“Borrower”), Dynegy Coal Investments Holdings, LLC, a Delaware limited liability
company (“Investments Holdings”), the Subsidiary Guarantors party thereto from
time to time and Credit Suisse AG, Cayman Islands Branch, as administrative
agent (“Administrative Agent”) and as Collateral Trustee for the Secured
Parties.

(b) “Credit Agreement”: That certain Credit Agreement, dated as of August     ,
2011, as the same may be amended, amended and restated, supplemented or
otherwise modified from time to time, by and among the Borrower, Investments
Holdings, the Lenders, Credit Suisse AG, Cayman Islands Branch, as
Administrative Agent and as Collateral Agent for the Lenders, Credit Suisse
Securities (USA) LLC and Goldman Sachs Lending Partners LLC, as Joint
Bookrunners and Joint Lead Arrangers, Barclays Capital, as Co-Manager and the
other parties thereto from time to time.

(c) “Event of Default”: The occurrence of an Event of Default under and as
defined in the Credit Agreement.

(d) “Guarantee and Collateral Agreement”: That certain Guarantee and Collateral
Agreement, dated as of August     , 2011, by and among the Borrower, Investments
Holdings, the Subsidiaries party thereto and the Collateral Trustee for the
benefit of the Secured Parties as the same may be amended, amended and restated,
supplemented or otherwise modified or replaced from time to time.

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

Exhibit E

to Credit Agreement

 

(e) “Mortgaged Property”: All of Mortgagor’s right title and interest in the
real property described in Exhibit A attached hereto and incorporated herein by
this reference, together with any greater estate in such real property as
hereafter may be acquired by Mortgagor (the “Land”), and all of Mortgagor’s
right, title and interest now or hereafter acquired in and to (1) 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”), (2) all fixtures
(within the meaning provided in the UCC, defined below), and all appurtenances
and additions thereto and substitutions or replacements thereof in which
Mortgagor has an interest and now or hereafter attached to the Premises,
including, without limitation, all cribhouses, pump bays, stop logs, traveling
water screens, water pumps and motor drives, drain pumps and motor drives,
valves, expansion joints, cranes, screen wash pumps, pipe branches, settling
basins, clarifiers, storage basins, piping, tanks, fire pumps and motor drives,
hydrants, fire loop supply mains, pump houses, head tanks, domestic water pumps
and motor drives, foam systems, filters, suction pumps and motor drives,
forwarding pumps and motor drives, septic tanks, industrial water affluant
piping systems, oil transfer systems, disconnect switches, grounding, line
traps, coupling capacitor potential devices, switchyard buses, circuit breakers,
steel towers, transformers, cables, lighting arrestors, relay and control
panels, telephone systems, carrier signal systems, microwave systems,
desuperheating stations, heaters, condensate collection systems, auxiliary
boilers, condensers, steam turbines, generators, non-condensable gas extraction
systems, abatement plants and cooling towers (the “Fixtures”), (3) all goods,
accounts, inventory, general intangibles, instruments, documents, contract
rights and chattel paper, including all such items as defined in the UCC, now
owned or hereafter acquired by Mortgagor and now or hereafter affixed to, placed
upon, used in connection with, arising from or otherwise related to the Premises
(the “Personalty”), (4) all reserves, escrows or impounds required under the
Financing Documents and all deposit accounts maintained by Mortgagor with
respect to the Mortgaged Property (the “Deposit Accounts”), (5) all leases,
licenses, concessions, occupancy agreements or other agreements (written or
oral, now or at any time in effect) which grant to any Person 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”), (6) all of
the rents, revenues, royalties, income, proceeds, profits, accounts receivable,
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”),
(7) all other agreements, such as construction contracts, architects’
agreements, engineers’ contracts, utility contracts, maintenance agreements,
management agreements, service contracts, listing agreements, guaranties,
warranties, permits, licenses, certificates and entitlements in any way relating
to the construction, use, occupancy, operation, maintenance, enjoyment or
ownership of the Mortgaged Property (the “Property Agreements”), (8) all rights,
privileges, tenements, hereditaments, rights-of-way, easements, appendages and
appurtenances appertaining to the foregoing, (9) all property tax refunds
payable with respect to the Mortgaged Property (the “Tax Refunds”), (10) all
accessions, replacements and substitutions for any of the foregoing and all
proceeds thereof (the “Proceeds”), (11) all insurance policies, unearned
premiums therefor and proceeds from such policies covering any of the above
property

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

Exhibit E

to Credit Agreement

 

now or hereafter acquired by Mortgagor (the “Insurance”), and (12) 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 Land, Improvements, Fixtures or Personalty (the “Condemnation
Awards”), excluding Excluded Assets. 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.

(f) “Obligations” has the meaning ascribed to such term in the Intercreditor
Agreement.

(g) “UCC”: The Uniform Commercial Code of the State of [                    ]
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
[                    ], then, as to the matter in question, the Uniform
Commercial Code in effect in that state.

ARTICLE II

GRANT

Section 2.1 Grant. To secure the full and timely payment and performance of the
Obligations, Mortgagor MORTGAGES, GRANTS, BARGAINS, ASSIGNS, SELLS, CONVEYS and
CONFIRMS, to Mortgagee the Mortgaged Property, subject, however, only to the
liens and matters permitted under Section 6.02 of the Credit Agreement and those
that are set forth on Exhibit B attached hereto (collectively, the “Permitted
Encumbrances”), TO HAVE AND TO HOLD the Mortgaged Property to Mortgagee, and
Mortgagor does hereby bind itself, its successors and assigns to WARRANT AND
FOREVER DEFEND the title to the Mortgaged Property (subject to Permitted
Encumbrances) unto Mortgagee.

Section 2.2 Intercreditor Agreement. Each Person that is secured hereunder, by
accepting the benefits of the security provided hereby, to the extent such
Person is governed by the terms and conditions of the Intercreditor Agreement,
(i) authorizes (or is deemed to authorize) Collateral Trustee on behalf of such
Person to enter into, and perform under, the Intercreditor Agreement and
(ii) acknowledges (or is deemed to acknowledge) that a copy of the Intercreditor
Agreement was delivered, or made available, to such Person.

ARTICLE III

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. Mortgagor
owns, or has a valid easement interest in, that portion of the Mortgaged
Property that constitutes real

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

Exhibit E

to Credit Agreement

 

property, including Fixtures, to the extent they constitute real property (but
excluding, for purposes of this representation and warranty, any after-acquired
title), free and clear of any liens, claims or interests, except the Permitted
Encumbrances. This Mortgage creates valid, enforceable first priority liens and
security interests against that portion of the Mortgaged Property that
constitutes real property, including Fixtures, to the extent they constitute
real property, subject to Permitted Encumbrances, except as the enforceability
thereof may be limited by the effect of any applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors’ rights generally
and by general principles of equity and except with respect to real property
interests acquired after the date hereof. By acceptance of this Mortgage,
Mortgagee agrees for the purposes of this Mortgage and the Credit Agreement that
any breach of the representations, warranties and covenants of this Section 3.1,
or the obligation to warrant and defend title as a result thereof, will not
constitute a representation, warranty, certification or statement of fact
“incorrect or misleading in any material respect when made or deemed made,”
except in the event that any such breach, whether alone or together with any
similar breach of the warranties of title made by Mortgagor in any other
Financing Document with respect to the real property that is the subject
thereof, constitutes or results in a Material Adverse Effect.

Section 3.2 Lien Status. Mortgagor shall preserve and protect the lien and
security interest priority of this Mortgage and the other Security Documents. If
any lien or security interest other than a Permitted Encumbrance 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 (including the requirement, if any, of providing
a bond or other security satisfactory to Mortgagee) so as to cause it to be
released or contest or cause to be contested the same in accordance with
Section 5.03 of the Credit Agreement.

Section 3.3 Payment and Performance. Mortgagor shall pay and perform the
Obligations when due and required under the Financing Documents.

Section 3.4 Replacement of Fixtures and Personalty. Mortgagor shall not, without
the prior written consent of Mortgagee, permit any of the Fixtures or Personalty
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 or
repair or is permitted to be removed or disposed of by any Financing Document.

Section 3.5 Inspection. Without limiting Mortgagee’s rights pursuant to the
Financing Documents, Mortgagor shall permit Mortgagee and the other Secured
Parties, and their respective agents, representatives and employees, to inspect
the Mortgaged Property and all books and records of Mortgagor located thereon in
accordance with Section 5.07 of the Credit Agreement.

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

Exhibit E

to Credit Agreement

 

Section 3.6 Other Covenants. All of the covenants in the Financing Documents are
incorporated herein by reference and, together with covenants in this Article
III, shall be covenants running with the Land.

Section 3.7 Insurance; Condemnation Awards and Insurance Proceeds.

(a) Insurance. Mortgagor shall maintain or cause to be maintained insurance,
including flood insurance, with respect to the Mortgaged Property pursuant to
and in accordance with the Credit Agreement.

(b) Condemnation Awards. 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
Financing Documents.

(c) Insurance Proceeds. Mortgagor assigns to Mortgagee all proceeds of any
Insurance (whether or not the Mortgagee is the loss payee thereof) payable by
reason of loss of or damage to or otherwise with respect to the Mortgaged
Property. Mortgagor authorizes Mortgagee to collect, receive and apply such
proceeds as provided in the Financing Documents.

ARTICLE IV

DEFAULT AND FORECLOSURE

Section 4.1 Remedies. Upon the occurrence and during the continuance of an Event
of Default, Mortgagee may, at Mortgagee’s election, exercise any or all of the
following rights, remedies and recourses:

(a) Acceleration. Subject to any provisions of the Financing Documents providing
for the automatic acceleration of the Obligations upon the occurrence of certain
Events of Default, declare the Obligations 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 to the fullest extent permitted by law),
whereupon the same shall become immediately due and payable.

(b) Entry on Mortgaged Property. 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 Event of Default and
without Mortgagee’s prior written consent, Mortgagee may invoke any legal
remedies to dispossess Mortgagor.

(c) Operation of Mortgaged Property. Hold, lease, develop, manage, operate or
otherwise use the Mortgaged Property upon such terms and conditions as Mortgagee
may deem reasonable under the circumstances (making such repairs, alterations,
additions and improvements and taking other actions, from time to time, as
Mortgagee deems necessary or desirable), and apply all Rents and other amounts
collected by

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

Exhibit E

to Credit Agreement

 

Mortgagee in connection therewith in accordance with the provisions of
Section 4.7 herein.

(d) Foreclosure and Sale. Institute proceedings for the complete foreclosure of
this Mortgage by judicial action or, to the extent permitted under applicable
law, by power of sale, in which case the Mortgaged Property may be sold for cash
or credit in one or more parcels. 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, power of sale (to the extent permitted under
applicable law) 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 or
any of the other Secured Parties may be a purchaser at such sale. If Mortgagee
or any other Secured Party is the highest bidder, Mortgagee or such other
Secured Party may credit the portion of the purchase price that would be
distributed to Mortgagee or such other Secured Party against the Obligations in
lieu of paying cash. In the event this Mortgage is foreclosed by judicial
action, appraisement of the Mortgaged Property is waived to the fullest extent
permitted by law.

(e) Receiver. 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 Obligations, 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 cases, including the
full power to rent, maintain and otherwise operate the Mortgaged Property upon
such terms as may be approved by the court, and shall apply such Rents in
accordance with the provisions of Section 4.7 herein.

(f) Other. Exercise all other rights, remedies and recourses granted under the
Financing Documents or otherwise available at law or in equity.

Section 4.2 Separate Sales. The Mortgaged Property may be sold in one or more
parcels and in such manner and order as Mortgagee in its sole discretion may
elect. The right of sale arising out of any Event of Default shall not be
exhausted by any one or more sales.

Section 4.3 Remedies Cumulative, Concurrent and Nonexclusive. Mortgagee and the
other Secured Parties shall have all rights, remedies and recourses granted in
the Financing 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
under any of the Financing Documents, or

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

Exhibit E

to Credit Agreement

 

against the Mortgaged Property, or against any one or more of them, at the sole
discretion of Mortgagee or the other Secured Parties, as the case may be, (c)
may be exercised as often as occasion therefor 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 or any other Secured Party in
the enforcement of any rights, remedies or recourses under the Financing
Documents or otherwise at law or equity shall be deemed to cure any Event of
Default.

Section 4.4 Release of and Resort to Collateral. Subject to the terms of the
Financing Documents, 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 the other Security Documents or their priority with respect to the Mortgaged
Property. For payment and performance of the Obligations, Mortgagee may resort
to any other security in such order and manner as Mortgagee may elect.

Section 4.5 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
Event of Default or of Mortgagee’s election to exercise or the actual exercise
of any right, remedy or recourse provided for under the Financing Documents, and
(c) any right to a marshalling of assets or a sale in inverse order of
alienation.

Section 4.6 Discontinuance of Proceedings. If Mortgagee or any other Secured
Party shall have proceeded to invoke any right, remedy or recourse permitted
under the Financing Documents and shall thereafter elect to discontinue or
abandon it for any reason, Mortgagee or such other Secured Party, as the case
may be, shall have the unqualified right to do so and, in such an event,
Mortgagor, Mortgagee and the other Secured Parties shall be restored to their
former positions with respect to the Obligations, the Financing Documents, the
Mortgaged Property and otherwise, and the rights, remedies, recourses and powers
of Mortgagee and the other Secured Parties shall continue as if the right,
remedy or recourse had never been invoked, but no such discontinuance or
abandonment shall waive any Event of Default which may then exist or the right
of Mortgagee or any other Secured Party thereafter to exercise any right, remedy
or recourse under any of the Financing Documents for such Event of Default.

Section 4.7 Application of Proceeds. The proceeds of any sale of, and the Rents
and other amounts generated by the holding, leasing, management, operation or
other use of the Mortgaged Property, shall be applied by

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

Exhibit E

to Credit Agreement

 

Mortgagee (or the receiver, if one is appointed) in the following order unless
otherwise required by applicable law, and subject to the terms of the Financing
Documents:

(a) to the payment of the costs and expenses of taking possession of the
Mortgaged Property and of holding, using, leasing, maintaining, repairing 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) reasonable attorneys’ and accountants’ fees
and expenses, and (4) costs of advertisement;

(b) to the payment and performance of the Obligations as provided in the
Financing Documents; and

(c) the balance, if any, to the Persons legally entitled thereto.

Section 4.8 Occupancy After Foreclosure. Any sale of the Mortgaged Property or
any part thereof in accordance with Section 4.1(d) herein will divest all right,
title and interest of Mortgagor in and to the property sold. Subject to
applicable law, 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 4.9 Additional Advances and Disbursements; Costs of Enforcement.

(a) Upon the occurrence and during the continuance of an Event of Default,
Mortgagee and each of the other Secured Parties shall have the right, but not
the obligation, to cure such Event of Default in the name and on behalf of
Mortgagor. All sums advanced and expenses incurred at any time by Mortgagee or
any other Secured Party under this Section 4.9, or otherwise under this Mortgage
or any of the other Financing 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 Default Rate, 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 other Financing Documents, or the enforcement, compromise or settlement
of the Obligations or any claim under this Mortgage and the other Financing
Documents, and for the curing thereof, or for defending or asserting the rights
and claims of Mortgagee in respect thereof, by litigation or otherwise.

Section 4.10 No Mortgagee in Possession. Neither the enforcement of any of the
remedies under this Article IV, the assignment of the Rents and Leases under
Article V herein, the security interests under Article VI herein, nor any other
remedies afforded to Mortgagee under the Financing Documents, at law or in
equity

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

Exhibit E

to Credit Agreement

 

shall cause Mortgagee or any other Secured Party to be deemed or construed to be
a mortgagee in possession of the Mortgaged Property, to obligate Mortgagee or
any other Secured Party 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 prior to
taking possession directly or through an agent.

Section 4.11 WAIVER OF JURY TRIAL. MORTGAGEE AND MORTGAGOR HEREBY KNOWINGLY,
INTENTIONALLY AND VOLUNTARILY EXPRESSLY WAIVE ANY RIGHT TO TRIAL BY JURY OF ANY
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER THIS MORTGAGE OR ANY
OTHER FINANCING DOCUMENT OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL
TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO ANY
FINANCING DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER
NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR
OTHERWISE; AND MORTGAGEE AND MORTGAGOR HEREBY AGREE AND CONSENT THAT ANY SUCH
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT
A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR
A COPY OF THIS SECTION 4.11 WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF
MORTGAGEE AND MORTGAGOR TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

ARTICLE V

ASSIGNMENT OF RENTS AND LEASES

Section 5.1 Assignment. In furtherance of and in addition to the assignment made
by Mortgagor in Section 2.1 herein, 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 Event of Default shall have occurred and
be continuing, Mortgagor shall have a license (revocable as hereinafter
provided) 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 Obligations and to
otherwise use the same. The foregoing license is granted subject to the
conditional limitation that no Event of Default shall have occurred and be
continuing. Upon the occurrence and during the continuance of an Event of
Default, whether or not legal proceedings have commenced, and without regard to
waste, adequacy of security for the Obligations 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).

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

Exhibit E

to Credit Agreement

 

Section 5.2 Perfection Upon Recordation. Mortgagor covenants 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 subject
to the Permitted Encumbrances. Mortgagor acknowledges and agrees that upon
recordation of this 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. For purposes of this Section 5.2, “possession” shall mean any one of the
following to the extent permitted by applicable law: (a) actual possession of
the Mortgaged Property or (b) taking affirmative actions to gain possession of
the Mortgaged Property that would constitute constructive possession of the
Mortgaged Property such as court authorization to collect Rents without taking
possession of the Mortgage Property. To the extent permitted by applicable law
and subject to the license granted to Mortgagor pursuant to Section 5.1 herein,
Mortgagee shall have the right to collect Rents without taking possession of the
Mortgaged Property.

Section 5.3 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 5.4 No Merger of Estates. So long as part of the Obligations secured
hereby 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 VI

SECURITY AGREEMENT

Section 6.1 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 Personalty, Fixtures, Leases, Rents, Deposit Accounts,
Property Agreements, Tax Refunds, Proceeds, Insurance and Condemnation Awards.
To this end, Mortgagor grants to Mortgagee a security interest in the
Personalty, Fixtures, Leases, Rents, Deposit Accounts, Property Agreements, Tax
Refunds, Proceeds, Insurance, Condemnation Awards and all other Mortgaged
Property which is personal property to secure the payment and performance of the
Obligations, and agrees that Mortgagee shall have all the rights and remedies of
a secured party under the UCC with respect to such

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Exhibit E

to Credit Agreement

 

property. Any notice of sale, disposition or other intended action by Mortgagee
with respect to the Personalty, Fixtures, Leases, Rents, Deposit Accounts,
Property Agreements, Tax Refunds, Proceeds, Insurance and Condemnation Awards
sent to Mortgagor at least ten (10) days prior to any action under the UCC shall
constitute reasonable notice to Mortgagor.

Section 6.2 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 reasonably 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. Such financing
statements may describe the collateral in the same manner as described in the
Guarantee and Collateral Agreement. Mortgagor represents and warrants to
Mortgagee that Mortgagor’s jurisdiction of organization is the State of
Delaware. 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 6.3 Fixture Filing. This Mortgage shall also constitute a “fixture
filing” for the purposes of the UCC against all of the Mortgaged Property that
is or is to become Fixtures. The information provided in this Section 6.3 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 I. 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 Article I. A statement describing the
portion of the Mortgaged Property comprising the Fixtures hereby secured is set
forth in Section 1.1 (e) herein. Mortgagor represents and warrants to Mortgagee
that Mortgagor is the record owner or holder of a valid easement, as the case
may be, of the Mortgaged Property and that its organizational identification
number is 2961927.

ARTICLE VII

MISCELLANEOUS

Section 7.1 Notices. Any notice required or permitted to be given under this
Mortgage shall be given in accordance with Section 9.7 of the Intercreditor
Agreement.

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Exhibit E

to Credit Agreement

 

Section 7.2 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 Land. 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 the Financing Documents; provided, however,
that no such party shall be entitled to any rights thereunder without the prior
written consent of Mortgagee.

Section 7.3 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, 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 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 Event of 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 Obligations
and shall bear interest at the highest rate at which interest is then computed
on any portion of the Obligations; (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 7.3.

Section 7.4 Successors and Assigns. This Mortgage shall be binding upon and
inure to the benefit of Mortgagee, the other Secured Parties, 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 7.5 No Waiver. Any failure by Mortgagee or any of the other Secured
Parties to insist upon strict performance of any of the terms, provisions or
conditions of any of the Financing Documents shall not be deemed to be a waiver
of same, and Mortgagee and the other Secured Parties shall have the right at any
time to insist upon strict performance of all of such terms, provisions and
conditions.

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Exhibit E

to Credit Agreement

 

Section 7.6 Release or Reconveyance. On the terms and subject to the conditions
set forth in Section 5.1 of the Intercreditor Agreement or upon a sale or other
disposition of the Mortgaged Property permitted by the Credit Agreement and not
prohibited by the other Security Documents, 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 7.7 Inconsistencies. If any conflict or inconsistency exists between
this Mortgage and the Credit Agreement, the Guarantee and Collateral Agreement
or the Intercreditor Agreement, the terms of the Credit Agreement, the Guarantee
and Collateral Agreement or the Intercreditor Agreement, as applicable, shall
govern to the extent of such inconsistency, including, without limitation, with
respect to the Collateral covered under this Mortgage.

Section 7.8 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 Obligations secured hereby, or any agreement between Mortgagor and Mortgagee
or any rights or remedies of Mortgagee or any other Secured Party.

Section 7.9 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 State of New York (including, without limitation,
Section 5-1401 of the General Obligations Law of the State of New York).

Section 7.10 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 7.11 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 and to any extent, such provision shall be deemed severable from and
shall in no way affect the enforceability and validity of the remaining
provisions of this Mortgage.

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

Exhibit E

to Credit Agreement

 

Section 7.12 Entire Agreement. This Mortgage and the other Financing Documents
embody the entire agreement and understanding between Mortgagor and Mortgagee
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 7.13 Amendments. This Mortgage may be amended, supplemented or otherwise
modified only by an instrument in writing signed by Mortgagor and Mortgagee.

Section 7.14 Renewal, Etc.. Mortgagee may at any time and from time to time
renew or extend this Mortgage, or alter or modify the same in any way, or waive
any of the terms, covenants or conditions hereof in whole or in part and may
release any portion of the Mortgaged Property or any other security, and grant
such extensions and indulgences in relation to the Obligations as Mortgagee may
determine, without the consent of any junior lienor or encumbrancer and without
any obligation to give notice of any kind thereto and without in any manner
affecting the priority of the lien and security interest hereof on any part of
the Mortgaged Property; provided that nothing in this Section 7.14 shall grant
Mortgagee the right to alter or modify the Mortgage without the consent of
Mortgagor.

Section 7.15 Future Advances. This Mortgage is executed and delivered to secure,
among other things, Mortgagor’s guaranty of future advances under the Credit
Agreement and the other Financing Documents. It is understood and agreed that
this Mortgage secures Mortgagor’s guaranty of present and future advances made
pursuant to the Credit Agreement or the other Financing Documents and that the
lien of such future advances shall relate to the date of this Mortgage to the
extent permitted under applicable laws.

Section 7.16 Time of the Essence. Mortgagor acknowledges that time is of the
essence in performing all of Mortgagor’s obligations set forth herein.

Section 7.17 Mortgagee as Collateral Trustee under the Intercreditor Agreement;
Successor Collateral Trustees.

(a) Collateral Trustee been appointed to act as Collateral Trustee hereunder
pursuant to the Intercreditor Agreement. Collateral Trustee 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 Credit Agreement, the Guarantee and Collateral
Agreement, the Intercreditor Agreement or any related agency agreement among
Collateral Trustee and the other Secured Parties and this

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

Exhibit E

to Credit Agreement

 

Mortgage. Mortgagor and all other Persons shall be entitled to rely on releases,
waivers, consents, approvals, notifications and other acts of Collateral
Trustee, without inquiry into the existence of required consents or approvals of
the other Secured Parties therefor.

(b) Mortgagee shall at all times be the same Person that comprises the
Collateral Trustee under the Intercreditor Agreement. Written notice of
resignation by any Collateral Trustee pursuant to the Intercreditor Agreement
shall also constitute notice of resignation as Collateral Trustee under this
Mortgage. Removal of Collateral Trustee pursuant to Article VII of the
Intercreditor Agreement shall also constitute removal as Collateral Trustee
under this Mortgage. Appointment of a successor Collateral Trustee pursuant to
Article VII of the Intercreditor 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 the
Intercreditor 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, the Guarantee and Collateral Agreement and the Intercreditor 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.

ARTICLE VIII

LOCAL LAW PROVISIONS

Section 8.1 Inconsistencies. In the event of any inconsistencies between the
terms and conditions of this Article 8 and the other provisions of this
Mortgage, the terms and conditions of this Article 8 shall control and be
binding.

[To be inserted as applicable]

[THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK]

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Exhibit E

to Credit Agreement

 

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:

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Exhibit E

to Credit Agreement

 

STATE OF                       :       : SS. COUNTY OF                       :  

BE IT REMEMBERED, that on this      of August , 2011, before me, the subscriber,
personally appeared Kent R. Stephenson who I am satisfied is the person who
executed the within instrument as the Executive Vice President and General
Counsel of [                    ], a [                    ], and this person
thereupon acknowledged that the said instrument made by the corporation and
delivered by him as such corporate officer, is the voluntary act and deed of the
corporation, made by virtue of authority from said limited liability company’s
                    .

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Exhibit E

to Credit Agreement

 

EXHIBIT A

Legal Description

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

Exhibit E

to Credit Agreement

 

EXHIBIT B

Permitted Encumbrances

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

Exhibit F

to Credit Agreement

FORM OF AFFILIATE SUBORDINATION AGREEMENT

of

DYNEGY MIDWEST GENERATION, LLC

AFFILIATE SUBORDINATION AGREEMENT, dated as of [                    ], 20[    ]
(this “Agreement”), among the subordinated lenders listed on Schedule 1 hereto
(each a “Subordinated Lender” and collectively, the “Subordinated Lenders”),
DYNEGY MIDWEST GENERATION, LLC, a Delaware limited liability company (the
“Borrower”), and each Subsidiary listed on Schedule 2 hereto (together with the
Borrower, each a “Subordinated Borrower” and collectively, the “Subordinated
Borrowers”) and CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, in its capacity as
Administrative Agent under the Credit Agreement for the benefit of the Lenders
(each as defined below).

Reference is made to the Credit Agreement dated as of August 5, 2011 (as may be
amended, restated, replaced, refinanced, supplemented or otherwise modified from
time to time, the “Credit Agreement”; capitalized terms used herein and not
otherwise defined herein shall have the meanings assigned to such terms in the
Credit Agreement), among the Borrower, DYNEGY COAL INVESTMENTS HOLDINGS, LLC, a
Delaware limited liability company, the lenders from time to time party thereto
(the “Lenders”) and CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, as administrative
agent for the Lenders (in such capacity, including any successor thereto, the
“Administrative Agent”) and as Collateral Trustee for the Secured Parties, and
the other banks, other financial institutions and entities party thereto from
time to time.

All references to articles, sections, exhibits and schedules shall be deemed
references to articles and sections of, and exhibits and schedules to, this
Agreement, unless the context shall otherwise require. Notwithstanding the
foregoing, no Lender or Secured Party shall

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Exhibit F

to Credit Agreement

 

be deemed to be an “Affiliate” of any Credit Party or of any Subsidiary of any
Credit Party solely by reason of the provisions of the Loan Documents.

The ability under the Credit Agreement of any Subordinated Borrower to incur
Indebtedness to any Subordinated Lender is conditioned upon the execution and
delivery by such Subordinated Lender and each Subordinated Borrower of an
agreement in the form hereof pursuant to which such Subordinated Lender agrees
to subordinate its rights with respect to the Subordinated Obligations (as
defined below) to the rights of the Senior Lenders (as defined below) under the
Credit Agreement, all on the terms set forth herein.

Accordingly, each Subordinated Lender, each Subordinated Borrower and the
Administrative Agent, on behalf of itself and each other Secured Party (each, as
defined in the Credit Agreement and together with each of their respective
successors or assigns, collectively, the “Senior Lenders”), hereby agrees as
follows:

SECTION 1. SUBORDINATION. (A) EACH SUBORDINATED LENDER HEREBY AGREES THAT ALL
ITS RIGHT, TITLE AND INTEREST IN AND TO THE SUBORDINATED OBLIGATIONS SHALL BE
SUBORDINATE AND JUNIOR IN RIGHT OF PAYMENT TO THE RIGHTS OF THE LENDERS, THE
ADMINISTRATIVE AGENT, THE COLLATERAL TRUSTEE, THE ARRANGERS, THE SYNDICATION
AGENT, THE DOCUMENTATION AGENT AND EACH OTHER SENIOR LENDER IN RESPECT OF THE
OBLIGATIONS (AS DEFINED IN THE CREDIT AGREEMENT, THE “SENIOR OBLIGATIONS”). FOR
PURPOSES HEREOF, “SUBORDINATED OBLIGATIONS” MEANS ALL OBLIGATIONS OF EACH
SUBORDINATED BORROWER TO EACH SUBORDINATED LENDER IN RESPECT OF LOANS, ADVANCES,
EXTENSIONS OF CREDIT OR OTHER INDEBTEDNESS, INCLUDING IN RESPECT OF PRINCIPAL,
PREMIUM (IF ANY), INTEREST (INCLUDING INTEREST ACCRUING AFTER THE MATURITY OF
THE TERM LOANS AND INTEREST ACCRUING AFTER THE FILING OF ANY PETITION IN
BANKRUPTCY, OR THE COMMENCEMENT OF ANY INSOLVENCY, REORGANIZATION OR LIKE
PROCEEDING, WHETHER OR NOT A CLAIM FOR POST-FILING OR POST-PETITION INTEREST IS
ALLOWED IN SUCH PROCEEDING), FEES, CHARGES, EXPENSES, INDEMNITIES, REIMBURSEMENT
OBLIGATIONS AND OTHER AMOUNTS PAYABLE IN RESPECT THEREOF.

(B) EACH SUBORDINATED BORROWER AND EACH SUBORDINATED LENDER AGREES (IN EACH CASE
SOLELY WITH RESPECT TO THE SUBORDINATED OBLIGATIONS IN RESPECT OF WHICH IT IS
THE OBLIGOR OR OBLIGEE, AS THE CASE

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

Exhibit F

to Credit Agreement

 

MAY BE, AND SOLELY WITH RESPECT TO EACH SUBORDINATED BORROWER OR SUBORDINATED
LENDER THAT IS ITS COUNTERPARTY ON SUCH SUBORDINATED OBLIGATIONS) THAT NO
PAYMENT (WHETHER DIRECTLY, BY PURCHASE, REDEMPTION, EXERCISE OF ANY RIGHT OF
SETOFF OR OTHERWISE) IN RESPECT OF THE SUBORDINATED OBLIGATIONS, WHETHER AS
PRINCIPAL, INTEREST OR OTHERWISE, AND WHETHER IN CASH, SECURITIES OR OTHER
PROPERTY, SHALL BE MADE BY OR ON BEHALF OF ANY SUBORDINATED BORROWER TO ANY
SUBORDINATED LENDER NOT A LOAN PARTY OR RECEIVED, ACCEPTED OR DEMANDED, DIRECTLY
OR INDIRECTLY, BY OR ON BEHALF OF ANY SUBORDINATED LENDER NOT A LOAN PARTY AT
ANY TIME UPON THE OCCURRENCE AND DURING THE CONTINUATION OF AN EVENT OF DEFAULT.

(c) Upon any distribution of the assets of any Subordinated Borrower or upon any
dissolution, winding up, liquidation or reorganization of any Subordinated
Borrower, whether in bankruptcy, insolvency, reorganization, arrangement or
receivership proceedings or otherwise, or upon any assignment for the benefit of
creditors or any other marshalling of the assets and liabilities of any
Subordinated Borrower, or otherwise (in each case except as permitted by the
Credit Agreement):

(i) the Senior Lenders shall first be entitled to receive unconditional, final
and irrevocable payment in full in cash of the Senior Obligations (whenever
arising) before any Subordinated Lender shall be entitled to receive any payment
on account of the Subordinated Obligations of such Subordinated Borrower,
whether of principal, interest, fees or otherwise; and

(ii) any payment by, or on behalf of, or distribution of the assets of, such
Subordinated Borrower of any kind or character on account of the Subordinated
Obligations, whether in cash, securities, property or otherwise, to which any
Subordinated Lender would be entitled except for the provisions of this
Section 1 shall be paid or delivered by the Person making such payment or
distribution (whether a trustee in bankruptcy, a receiver, custodian,
liquidating trustee or any other Person) directly to the Administrative Agent,
for the benefit of the Senior Lenders, payable in accordance with the terms of
the Credit Agreement, until the unconditional, final and irrevocable payment in
full of all Senior Obligations.

(d) Upon the occurrence and during the continuance of an Event of Default, each
Subordinated Lender (if not a Loan Party) agrees not to ask, demand, sue for or
take or receive from any Subordinated Borrower, in cash, securities, property or
otherwise, or by setoff, purchase, redemption (including, without limitation,
from or by way of collateral) or otherwise, payment of all or any part of the
Subordinated Obligations and agrees, upon the occurrence and during the
continuance of an Event of Default, that in connection with any proceeding
involving

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

Exhibit F

to Credit Agreement

 

any Subordinated Borrower under any bankruptcy, insolvency, reorganization,
arrangement, receivership or similar law (i) the Administrative Agent is
irrevocably authorized and empowered (in its own name or in the name of such
Subordinated Lender or otherwise), but shall have no obligation, to demand, sue
for, collect and receive every payment or distribution referred to in the
preceding sentence and give acquittance therefor and to file claims and proofs
of claim and take such other action (including, without limitation, voting the
applicable Subordinated Obligations and enforcing any security interest or other
Lien securing payment of such Subordinated Obligations) as the Administrative
Agent may deem reasonably necessary or advisable for the exercise or enforcement
of any of the rights, remedies, benefits or interests of the Senior Lenders and
(ii) such Subordinated Lender shall duly and promptly take such action as the
Administrative Agent may reasonably request to (A) collect amounts in respect of
the applicable Subordinated Obligations for the account of the Senior Lenders
and to file appropriate claims or proofs of claim in respect of such
Subordinated Obligations, (B) execute and deliver to the Administrative Agent
such irrevocable powers of attorney, assignments or other instruments as the
Administrative Agent may reasonably request in order to enable the
Administrative Agent to enforce any and all claims with respect to, and any
security interests and other Liens securing payment of, the applicable
Subordinated Obligations and (C) collect and receive any and all payments or
distributions which may be payable or deliverable upon or with respect to the
applicable Subordinated Obligations. A copy of this Agreement may be filed with
any court as evidence of each Senior Lender’s right, power and authority
hereunder.

(e) In the event that any payment by, or on behalf of, or distribution of the
assets of, any Subordinated Borrower of any kind or character, whether in cash,
securities, property or otherwise, and whether directly, by purchase,
redemption, exercise of any right of setoff or otherwise, shall be received by
or on behalf of any Subordinated Lender or any Affiliate thereof at a time when
such payment is prohibited by this Agreement, such payment or distribution shall
be held by such Subordinated Lender or Affiliate in trust (segregated from other
property of such Subordinated Lender or Affiliate) for the benefit of, and shall
forthwith be paid over to, the Administrative Agent, for the benefit of the
Senior Lenders, payable in accordance with the terms of the Credit Agreement,
until the unconditional, final and irrevocable payment in full of all Senior
Obligations.

(f) Subject to the prior unconditional, final and irrevocable payment in full of
all Senior Obligations, each applicable Subordinated Lender shall be subrogated
to the rights of the Senior Lenders to receive payments or distributions in
cash, securities, property or otherwise

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

Exhibit F

to Credit Agreement

 

of each applicable Subordinated Borrower applicable to the Senior Obligations,
and, as between and among a Subordinated Borrower, its creditors (other than the
Senior Lenders) and the applicable Subordinated Lenders, no such payment or
distribution made to the Senior Lenders by virtue of this Agreement that
otherwise would have been made to any applicable Subordinated Lender shall be
deemed to be a payment by the applicable Subordinated Borrower on account of the
Subordinated Obligations, it being understood that the provisions of this
Section 1(f) are intended solely for the purpose of defining the relative rights
of the Subordinated Lenders and the Senior Lenders.

(g) Without the prior written consent of the Administrative Agent, no
Subordinated Borrower shall give, or permit to be given, and shall cause each of
its subsidiaries not to give or permit to be given, and no Subordinated Lender
shall receive, accept or demand, (i) any security of any nature whatsoever for
any Subordinated Obligations on any cash, securities, property or other assets,
whether now existing or hereafter acquired, of any Subordinated Borrower or any
subsidiary of any Subordinated Borrower, unless such security shall by its terms
be subject to enforcement and collection by the Administrative Agent or the
Collateral Trustee, as the case may be, in connection with any action in respect
of enforcement or collection taken under Section 1(c) above or (ii) any
Guarantee, of any nature whatsoever, by any Subordinated Borrower or any
subsidiary of any Subordinated Borrower, of any Subordinated Obligations other
than any Guarantee subordinated to the Senior Obligations on terms substantially
identical to (and no less favorable in any significant respect to the Senior
Lenders than) those hereof. Each Subordinated Lender agrees that all the
proceeds of any such security or Guarantee shall be subject to the provisions
hereof with respect to payments and other distributions in respect of the
Subordinated Obligations.

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

Exhibit F

to Credit Agreement

 

(h) Each Subordinated Lender and each Subordinated Borrower agrees that all
Subordinated Obligations, if evidenced by a promissory note, will be evidenced
solely by a single promissory note in the form attached hereto as Annex 1
(unless and to the extent otherwise agreed by the Administrative Agent), and
that such promissory note and any and all instruments now or hereafter creating
or evidencing the Subordinated Obligations, whether upon refunding, extension,
renewal, refinancing, replacement or otherwise, shall contain the following
legend:

“Notwithstanding anything contained herein to the contrary, neither the
principal of nor the interest on, nor any other amounts payable in respect of,
the indebtedness created or evidenced by this instrument or record shall become
due or be paid or payable, except to the extent permitted under the Affiliate
Subordination Agreement, dated as of [            ], 20[    ], among the
Subordinated Lenders, the Subordinated Borrowers and Credit Suisse AG, Cayman
Islands Branch, in its capacity as Administrative Agent under the Credit
Agreement, which Affiliate Subordination Agreement is incorporated herein with
the same effect as if fully set forth herein.”

(i) Each Subordinated Lender agrees that, except for claims submitted in any
proceeding contemplated by Section 1(c), it will not take any action to cause
any Subordinated Obligations to become payable prior to their scheduled maturity
(which, in the case of any demand notes, shall be the date demand is made
thereunder) or exercise any remedies or take any action or proceeding to enforce
any Subordinated Obligation if the payment of such Subordinated Obligation is
then prohibited by this Agreement, and each Subordinated Lender further agrees
not to file, or to join with any other creditors of any Subordinated Borrower in
filing, any petition commencing any bankruptcy, insolvency, reorganization,
arrangement or receivership proceeding or any assignment for the benefit of
creditors against or in respect of such Subordinated Borrower or any other
marshalling of the assets and liabilities of such Subordinated Borrower
(provided that this prohibition shall in no event be construed so as to limit
(x) any Subordinated Lender’s right to cause any Subordinated Obligations to
become payable prior to their scheduled maturity if all the outstanding Term
Loans under the Credit

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

Exhibit F

to Credit Agreement

 

Agreement have been declared forthwith due and payable prior to their scheduled
maturity date) or (y) any Subordinated Borrower’s right to prepay any
Subordinated Obligation if the respective prepayment is not otherwise prohibited
at such time hereunder or under the Credit Agreement. Each Subordinated Lender
further agrees, to the fullest extent permitted under applicable law, that it
will not cause any Subordinated Borrower to file any such petition, commence any
such proceeding or make any such assignment referred to above until all Senior
Obligations have been unconditionally and irrevocably paid in cash.

SECTION 2. WAIVERS AND CONSENTS. (A) EACH SUBORDINATED LENDER WAIVES THE RIGHT
TO COMPEL THAT THE COLLATERAL OR ANY OTHER ASSETS OR PROPERTY OF ANY
SUBORDINATED BORROWER OR ANY OF ITS SUBSIDIARIES OR THE ASSETS OR PROPERTY OF
ANY GUARANTOR OF THE SENIOR OBLIGATIONS OR ANY OTHER PERSON BE APPLIED IN ANY
PARTICULAR ORDER TO DISCHARGE THE SENIOR OBLIGATIONS. EACH SUBORDINATED LENDER
EXPRESSLY WAIVES THE RIGHT TO REQUIRE THE SENIOR LENDERS TO PROCEED AGAINST ANY
SUBORDINATED BORROWER, ANY OF ITS SUBSIDIARIES, THE COLLATERAL, ANY OTHER ASSETS
OR PROPERTY OF ANY SUBORDINATED BORROWER OR ANY OF ITS SUBSIDIARIES OR ANY
GUARANTOR OF THE SENIOR OBLIGATIONS OR ANY OTHER PERSON, OR TO PURSUE ANY OTHER
REMEDY IN ANY SENIOR LENDER’S POWER WHICH SUCH SUBORDINATED LENDER CANNOT PURSUE
AND WHICH WOULD LIGHTEN SUCH SUBORDINATED LENDER’S BURDEN, NOTWITHSTANDING THAT
THE FAILURE OF ANY SENIOR LENDER TO DO SO MAY THEREBY PREJUDICE SUCH
SUBORDINATED LENDER. EACH SUBORDINATED LENDER AGREES THAT IT SHALL NOT BE
DISCHARGED, EXONERATED OR HAVE ITS OBLIGATIONS HEREUNDER TO THE SENIOR LENDERS
REDUCED BY (I) ANY SENIOR LENDER’S DELAY IN PROCEEDING AGAINST OR ENFORCING ANY
REMEDY AGAINST ANY SUBORDINATED BORROWER, ANY OF ITS SUBSIDIARIES, THE
COLLATERAL OR ANY OTHER ASSET OR PROPERTY OF ANY SUBORDINATED BORROWER OR ANY OF
ITS SUBSIDIARIES OR ANY GUARANTOR OF THE SENIOR OBLIGATIONS OR ANY OTHER PERSON,
(II) ANY SENIOR LENDER RELEASING ANY SUBORDINATED BORROWER, ANY OF ITS
SUBSIDIARIES, THE COLLATERAL OR ANY OTHER ASSET OR PROPERTY OF ANY SUBORDINATED
BORROWER OR ANY OF ITS SUBSIDIARIES OR ANY OTHER GUARANTOR OF THE SENIOR
OBLIGATIONS OR ANY OTHER PERSON FROM ALL OR ANY PART OF THE SENIOR OBLIGATIONS
OR (III) THE DISCHARGE OF ANY SUBORDINATED BORROWER, ANY OF ITS SUBSIDIARIES,
THE COLLATERAL OR ANY OTHER ASSET OR PROPERTY OF ANY SUBORDINATED BORROWER OR
ANY OF ITS SUBSIDIARIES OR ANY GUARANTOR OF THE SENIOR OBLIGATIONS OR ANY OTHER
PERSON BY AN OPERATION OF LAW OR OTHERWISE, WITH OR WITHOUT THE INTERVENTION OR
OMISSION OF A SENIOR LENDER. ANY SENIOR LENDER’S VOTE TO ACCEPT OR REJECT ANY
PLAN OF REORGANIZATION RELATING TO ANY SUBORDINATED BORROWER, ANY OF ITS

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

Exhibit F

to Credit Agreement

 

SUBSIDIARIES, THE COLLATERAL OR ANY OTHER ASSET OR PROPERTY OF ANY SUBORDINATED
BORROWER OR ANY OF ITS SUBSIDIARIES OR ANY GUARANTOR OF THE SENIOR OBLIGATIONS
OR ANY OTHER PERSON, OR ANY SENIOR LENDER’S RECEIPT ON ACCOUNT OF THE SENIOR
OBLIGATIONS, OTHER THAN THE UNCONDITIONAL, FINAL AND IRREVOCABLE PAYMENT IN FULL
IN CASH THEREOF, OF ANY CASH, SECURITIES, PROPERTY OR OTHER ASSETS DISTRIBUTED
IN ANY BANKRUPTCY, REORGANIZATION, INSOLVENCY OR SIMILAR PROCEEDING, SHALL NOT
DISCHARGE, EXONERATE, OR REDUCE THE OBLIGATIONS OF ANY SUBORDINATED LENDER
HEREUNDER TO THE SENIOR LENDERS.

(b) Each Subordinated Lender waives all rights and defenses arising out of an
election of remedies by the Senior Lenders, even though that election of
remedies, including, without limitation, any non-judicial foreclosure with
respect to security for the Senior Obligations, has impaired the value of such
Subordinated Lender’s rights of subrogation, reimbursement or contribution
against any Subordinated Borrower or any other guarantor of the Senior
Obligations or any other Person. To the extent permitted by applicable law, each
Subordinated Lender expressly waives any rights or defenses it may have by
reason of protection afforded to any Subordinated Borrower or any other
guarantor of the Senior Obligations or any other Person with respect to the
Senior Obligations pursuant to any anti-deficiency laws or other laws of similar
import which limit or discharge the principal debtor’s indebtedness upon
judicial or non-judicial foreclosure of real property or personal property
Collateral for the Senior Obligations.

(c) Each Subordinated Lender agrees that, without the necessity of any
reservation of rights against it, and without notice to or further assent by it,
any demand for payment of any Senior Obligations made by any Senior Lender may
be rescinded in whole or in part by such Senior Lender, and any Senior
Obligation may be continued, and the Senior Obligations, or the liability of the
applicable Subordinated Borrower, any of its subsidiaries or any other guarantor
or any other party upon or for any part thereof, or any Collateral or

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

Exhibit F

to Credit Agreement

 

Guarantee therefor or right of offset with respect thereto, may, from time to
time, in whole or in part, be renewed, replaced, extended, modified,
accelerated, compromised, waived, surrendered, or released by the Senior
Lenders, in each case without notice to or further assent by any Subordinated
Lender, which will remain bound under this Agreement and without impairing,
abridging, releasing or affecting the subordination and other agreements of the
Subordinated Lenders provided for herein.

(d) Each Subordinated Lender waives any and all notice of the creation, renewal,
extension or accrual of any of the Senior Obligations and notice of or proof of
reliance by the Senior Lenders upon this Agreement. The Senior Obligations, and
any of them, shall be deemed conclusively to have been created, contracted or
incurred and the consent given to create the obligations of each Subordinated
Borrower in respect of the Subordinated Obligations in reliance upon this
Agreement, and all dealings between each Subordinated Borrower and the Senior
Lenders shall be deemed to have been consummated in reliance upon this
Agreement. Each Subordinated Lender acknowledges and agrees that the Senior
Lenders have relied upon the subordination and other agreements provided for
herein in consenting to the Subordinated Obligations. Each Subordinated Lender
waives notice of or proof of reliance on this Agreement and protest, demand for
payment and notice of default.

SECTION 3. TRANSFERS. EACH SUBORDINATED LENDER SHALL NOT SELL, ASSIGN OR
OTHERWISE TRANSFER OR DISPOSE OF, IN WHOLE OR IN PART, ALL OR ANY PART OF THE
SUBORDINATED OBLIGATIONS OR ANY INTEREST THEREIN TO ANY OTHER PERSON (A
“TRANSFEREE”), OTHER THAN ANOTHER SUBORDINATED LENDER BOUND BY THE PROVISIONS OF
THIS AGREEMENT, OR CREATE, INCUR OR SUFFER TO EXIST ANY SECURITY INTEREST, LIEN,
CHARGE OR OTHER ENCUMBRANCE WHATSOEVER UPON ALL OR ANY PART OF THE SUBORDINATED
OBLIGATIONS OR ANY INTEREST THEREIN IN FAVOR OF ANY TRANSFEREE (OTHER THAN
PERMITTED LIENS) UNLESS (A) SUCH ACTION IS MADE EXPRESSLY SUBJECT TO THIS
AGREEMENT AND (B) THE TRANSFEREE, EXPRESSLY ACKNOWLEDGES TO THE ADMINISTRATIVE
AGENT, BY A WRITING IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE
ADMINISTRATIVE AGENT, THE SUBORDINATION AND OTHER

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

Exhibit F

to Credit Agreement

 

AGREEMENTS PROVIDED FOR HEREIN AND IN SUCH WRITING AGREES TO BE BOUND BY ALL OF
THE TERMS OF THIS AGREEMENT, INCLUDING, WITHOUT LIMITATION, THIS SECTION 3, AS
IF SUCH PERSON WERE A SUBORDINATED LENDER.

SECTION 4. SENIOR OBLIGATIONS UNCONDITIONAL. ALL RIGHTS AND INTERESTS OF THE
SENIOR LENDERS HEREUNDER, AND ALL AGREEMENTS AND OBLIGATIONS OF THE SUBORDINATED
LENDERS AND THE SUBORDINATED BORROWERS HEREUNDER, SHALL REMAIN IN FULL FORCE AND
EFFECT IRRESPECTIVE OF:

(a) any lack of validity or enforceability of the Credit Agreement or any other
Loan Document;

(b) any change in the time, manner or place of payment of, or in any other term
of, all or any of the Senior Obligations, or any amendment or waiver or other
modification, whether by course of conduct or otherwise, of, or consent to
departure from, the Credit Agreement or any other Loan Document;

(c) any exchange, release or non-perfection of any Lien in any Collateral, or
any release, amendment, waiver or other modification, whether in writing or by
course of conduct or otherwise, of, or consent to departure from, any Guarantee
of any of the Senior Obligations; or

(d) any other circumstances that might otherwise constitute a defense available
to, or a discharge of, any Subordinated Borrower, any of its subsidiaries, any
guarantor of the Senior Obligations or any other Person in respect of the Senior
Obligations, or of the Subordinated Lender, any Subordinated Borrower, any of
its subsidiaries, any guarantor of the Senior Obligations or any other Person in
respect of this Agreement (other than payment).

SECTION 5. REPRESENTATIONS AND WARRANTIES. EACH SUBORDINATED LENDER REPRESENTS
AND WARRANTS TO THE ADMINISTRATIVE AGENT, FOR THE BENEFIT OF THE SENIOR LENDERS,
THAT:

(a) It has the power and authority to execute and deliver and to perform its
obligations under this Agreement and has taken all necessary action to authorize
its execution, delivery and performance of this Agreement.

(b) This Agreement has been duly executed and delivered by such Subordinated
Lender and constitutes a legal, valid and binding obligation of such
Subordinated Lender, enforceable against it in accordance with its terms, except
as enforceability may be limited by applicable bankruptcy, insolvency or similar
laws affecting the enforcement of creditors’ rights generally or by equitable
principles relating to enforceability.

(c) The execution, delivery and performance of this Agreement will not violate
any provision of any material requirement of law applicable to such Subordinated
Lender or of any material contractual obligation of such Subordinated Lender.

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

Exhibit F

to Credit Agreement

 

(d) No consent or authorization of filing with, or other act by or in respect
of, any Governmental Authority, is required in connection with the execution,
delivery or performance of this Agreement, except for (i) such as have been
obtained and are in full force and effect and (ii) such filings which the
failure to obtain could not reasonably be expected to have a Material Adverse
Effect.

SECTION 6. WAIVER OF CLAIMS. (A) TO THE MAXIMUM EXTENT PERMITTED BY LAW, EACH
SUBORDINATED LENDER (IN ITS CAPACITY AS SUCH) WAIVES ANY CLAIM IT MIGHT HAVE
AGAINST ANY SENIOR LENDER WITH RESPECT TO, OR ARISING OUT OF, ANY ACTION OR
FAILURE TO ACT OR ANY ERROR OF JUDGMENT, NEGLIGENCE, OR MISTAKE OR OVERSIGHT
WHATSOEVER ON THE PART OF ANY SENIOR LENDER OR ITS DIRECTORS, OFFICERS,
EMPLOYEES, AGENTS OR AFFILIATES WITH RESPECT TO ANY EXERCISE OF RIGHTS OR
REMEDIES UNDER THE LOAN DOCUMENTS OR ANY TRANSACTION RELATING TO THE COLLATERAL,
EXCEPT TO THE EXTENT (X) DETERMINED BY A COURT OF COMPETENT JURISDICTION BY A
FINAL AND NON-APPEALABLE JUDGMENT TO HAVE RESULTED FROM THE GROSS NEGLIGENCE,
BAD FAITH OR WILLFUL MISCONDUCT OF SUCH SENIOR LENDER OR (Y) MADE WITH RESPECT
TO DISPUTES BETWEEN AND AMONG SENIOR LENDERS (OTHER THAN DISPUTES AGAINST ANY
SENIOR LENDER IN ITS CAPACITY, OR FULFILLING ITS ROLE AS, AN ADMINISTRATIVE
AGENT OR ARRANGER (OR AGAINST ANY OTHER SENIOR LENDER ACTING IN ITS CAPACITY AS
AFFILIATE, OFFICER, DIRECTOR OR EMPLOYEE FOR SUCH ADMINISTRATIVE AGENT OR
ARRANGER ACTING IN SUCH CAPACITY OR ROLE), OR ANY SIMILAR ROLE UNDER THE LOAN
DOCUMENTS). NONE OF THE SENIOR LENDERS NOR ANY OF THEIR RESPECTIVE DIRECTORS,
OFFICERS, EMPLOYEES, AGENTS OR AFFILIATES SHALL BE LIABLE TO ANY SUBORDINATED
LENDER (IN ITS CAPACITY AS SUCH) FOR FAILURE TO DEMAND, COLLECT OR REALIZE UPON
ANY OF THE COLLATERAL OR ANY GUARANTEE OR FOR ANY DELAY IN DOING SO OR SHALL BE
UNDER ANY OBLIGATION TO SELL OR OTHERWISE DISPOSE OF ANY COLLATERAL UPON THE
REQUEST OF ANY SUBORDINATED BORROWER, ANY OF ITS SUBSIDIARIES, ANY GUARANTOR OF
THE SENIOR OBLIGATIONS, ANY SUBORDINATED LENDER OR ANY OTHER PERSON OR TO TAKE
ANY OTHER ACTION WHATSOEVER WITH REGARD TO THE SECURITY DOCUMENTS, INCLUDING,
WITHOUT LIMITATION, THE GUARANTEE AND SECURITY AGREEMENT, OR ANY PART THEREOF.

(b) To the extent permitted by applicable law, each Subordinated Lender, for
itself and on behalf of its successors and assigns, hereby waives any and all
now existing or hereafter arising rights it may have to require the Senior
Lenders to marshal assets for the benefit of such Subordinated Lender, or to
otherwise direct the timing, order or manner of any sale, collection or other
enforcement of the Collateral or enforcement of the Loan Documents. The Senior
Lenders are under no duty or obligation, and each Subordinated Lender hereby
waives, to

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

Exhibit F

to Credit Agreement

 

the extent permitted by applicable law, any right it may have to compel the
Senior Lenders, to pursue any Subordinated Borrower, any of its subsidiaries,
any guarantor or other person who may be liable for the Senior Obligations, or
to enforce any Lien or security interest in any Collateral.

(c) Each Subordinated Lender hereby waives, to the extent permitted by
applicable law, any duty on the part of the Senior Lenders to disclose to it any
fact known or hereafter known by the Senior Lenders relating to the operation or
financial condition of any Subordinated Borrower, any of its subsidiaries or any
guarantor of the Senior Obligations, or their respective businesses. Each
Subordinated Lender enters into this Agreement based solely upon its independent
knowledge of the applicable Subordinated Borrower’s results of operations,
condition (financial or otherwise) and business and the Subordinated Lender
assumes full responsibility for obtaining any further or future information with
respect to the applicable Subordinated Borrower, any of its subsidiaries, any
guarantor of the Senior Obligations or their respective results of operations,
condition (financial or otherwise) or business.

SECTION 7. FURTHER ASSURANCES. EACH SUBORDINATED LENDER AND EACH SUBORDINATED
BORROWER, AT THEIR OWN EXPENSE AND AT ANY TIME FROM TIME TO TIME, UPON THE
WRITTEN REQUEST OF THE ADMINISTRATIVE AGENT SHALL PROMPTLY AND DULY EXECUTE AND
DELIVER SUCH FURTHER INSTRUMENTS AND DOCUMENTS AND TAKE SUCH FURTHER ACTIONS AS
THE ADMINISTRATIVE AGENT MAY REASONABLY REQUEST FOR THE PURPOSES OF OBTAINING,
PRESERVING OR EXTENDING THE FULL BENEFITS OF THIS AGREEMENT AND OF THE RIGHTS,
POWERS, REMEDIES, BENEFITS AND INTERESTS OF THE SENIOR LENDERS HEREIN GRANTED.

SECTION 8. [RESERVED].

SECTION 9. PROVISIONS DEFINE RELATIVE RIGHTS. THIS AGREEMENT IS INTENDED SOLELY
FOR THE PURPOSE OF DEFINING THE RELATIVE RIGHTS OF THE SENIOR LENDERS, ON THE
ONE HAND, AND THE SUBORDINATED LENDERS AND THE SUBORDINATED BORROWERS, ON THE
OTHER HAND, AND NO OTHER PERSON SHALL HAVE ANY RIGHT, REMEDY, BENEFIT OR OTHER
INTEREST UNDER THIS AGREEMENT.

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

Exhibit F

to Credit Agreement

 

SECTION 10. POWERS COUPLED WITH AN INTEREST. ALL POWERS, AUTHORIZATIONS AND
AGENCIES CONTAINED IN THIS AGREEMENT ARE COUPLED WITH AN INTEREST AND ARE
IRREVOCABLE UNTIL THE SENIOR OBLIGATIONS ARE UNCONDITIONALLY, FINALLY AND
IRREVOCABLY PAID IN FULL IN CASH (OTHER THAN INDEMNIFICATION OBLIGATIONS AND
OTHER CONTINGENT OBLIGATIONS NOT THEN DUE AND PAYABLE).

SECTION 11. NOTICES. ALL NOTICES, REQUESTS AND DEMANDS TO OR UPON ANY PARTY
HERETO SHALL BE IN WRITING AND SHALL BE GIVEN IN THE MANNER PROVIDED IN
SECTION 9.01 OF THE CREDIT AGREEMENT.

SECTION 12. COUNTERPARTS. THIS AGREEMENT MAY BE EXECUTED IN COUNTERPARTS (AND BY
DIFFERENT PARTIES HERETO ON DIFFERENT COUNTERPARTS), EACH OF WHICH SHALL
CONSTITUTE AN ORIGINAL, BUT ALL OF WHICH TAKEN TOGETHER SHALL CONSTITUTE A
SINGLE CONTRACT. DELIVERY OF AN EXECUTED SIGNATURE PAGE TO THIS AGREEMENT BY
FACSIMILE (OR OTHER ELECTRONIC) TRANSMISSION SHALL BE AS EFFECTIVE AS DELIVERY
OF A MANUALLY SIGNED COUNTERPART OF THIS AGREEMENT.

SECTION 13. SEVERABILITY. IN THE EVENT ANY ONE OR MORE OF THE PROVISIONS
CONTAINED IN THIS AGREEMENT SHOULD BE HELD INVALID, ILLEGAL OR UNENFORCEABLE IN
ANY RESPECT, THE VALIDITY, LEGALITY AND ENFORCEABILITY OF THE REMAINING
PROVISIONS CONTAINED HEREIN SHALL NOT IN ANY WAY BE AFFECTED OR IMPAIRED THEREBY
(IT BEING UNDERSTOOD THAT THE INVALIDITY OF A PARTICULAR PROVISION HEREOF IN A
PARTICULAR JURISDICTION SHALL NOT IN AND OF ITSELF AFFECT THE VALIDITY OF SUCH
PROVISION IN ANY OTHER JURISDICTION). THE PARTIES HERETO SHALL ENDEAVOR IN
GOOD-FAITH NEGOTIATIONS TO REPLACE THE INVALID, ILLEGAL OR UNENFORCEABLE
PROVISIONS WITH VALID PROVISIONS THE ECONOMIC EFFECT OF WHICH COMES AS CLOSE AS
POSSIBLE TO THAT OF THE INVALID, ILLEGAL OR UNENFORCEABLE PROVISIONS.

SECTION 14. INTEGRATION. THIS AGREEMENT REPRESENTS THE AGREEMENT OF THE
SUBORDINATED BORROWERS, THE SUBORDINATED LENDERS AND THE SENIOR LENDERS WITH
RESPECT TO THE SUBJECT MATTER HEREOF AND THERE ARE NO PROMISES OR
REPRESENTATIONS BY ANY SUBORDINATED BORROWER, ANY SUBORDINATED LENDER OR THE
SENIOR LENDERS RELATIVE TO THE SUBJECT MATTER HEREOF NOT REFLECTED HEREIN.

SECTION 15. AMENDMENTS IN WRITING; NO WAIVER; CUMULATIVE REMEDIES. (A) NONE OF
THE TERMS OR PROVISIONS OF THIS AGREEMENT MAY BE WAIVED, AMENDED, SUPPLEMENTED
OR OTHERWISE MODIFIED EXCEPT BY A WRITTEN INSTRUMENT EXECUTED BY THE
ADMINISTRATIVE AGENT, EACH AFFECTED SUBORDINATED BORROWER AND EACH AFFECTED
SUBORDINATED LENDER; PROVIDED THAT ANY PROVISION OF THIS AGREEMENT MAY BE WAIVED
BY THE SENIOR LENDERS IN A LETTER OR AGREEMENT EXECUTED BY THE REQUIRED LENDERS,
OR BY THE ADMINISTRATIVE AGENT WITH THE

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

Exhibit F

to Credit Agreement

 

WRITTEN CONSENT OF THE REQUIRED LENDERS, AND EACH AFFECTED SUBORDINATED LENDER.

(b) No failure or delay of the Administrative Agent, the Collateral Trustee or
any other Senior Lender in exercising any right, power, remedy, benefit or
privilege hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right, power, remedy, benefit or privilege, or any
abandonment or discontinuance of steps to enforce such right, power, remedy,
benefit or privilege, preclude any other or further exercise thereof or the
exercise of any other right, power, remedy, benefit or privilege.

(c) The rights and remedies of the Administrative Agent, the Collateral Trustee
and each other Senior Lender herein provided are cumulative, may be exercised
singly or concurrently and are not exclusive of any rights or remedies that any
of them would otherwise have.

SECTION 16. SECTION HEADINGS. THE SECTION HEADINGS USED IN THIS AGREEMENT ARE
FOR CONVENIENCE OF REFERENCE ONLY AND ARE NOT TO AFFECT THE CONSTRUCTION HEREOF
OR BE TAKEN INTO CONSIDERATION IN THE INTERPRETATION HEREOF.

SECTION 17. SUCCESSORS AND ASSIGNS. (A) THIS AGREEMENT SHALL BE BINDING UPON THE
SUCCESSORS AND ASSIGNS OF EACH OF THE SUBORDINATED BORROWERS AND EACH OF THE
SUBORDINATED LENDERS AND SHALL INURE TO THE BENEFIT OF THE ADMINISTRATIVE AGENT,
THE COLLATERAL TRUSTEE AND EACH OTHER SENIOR LENDER AND THEIR RESPECTIVE
SUCCESSORS AND ASSIGNS.

(b) Notwithstanding the provisions of clause (a) above, nothing herein shall be
construed to limit or relieve the obligations of any Subordinated Lender
pursuant to Section 3, and no Subordinated Lender shall assign its obligations
hereunder to any person (except as otherwise specifically permitted under
Section 3); any such assignment other than as specifically permitted under
Section 3 shall be void.

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

Exhibit F

to Credit Agreement

 

SECTION 18. GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE OF PROCESS. (A) THIS
AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH ND GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK.

(b) Each Subordinated Lender hereby irrevocably and unconditionally submits, for
itself and its property, to the exclusive jurisdiction of any New York State
court or Federal court of the United States of America sitting in New York City,
and any appellate court from any thereof, in any action or proceeding arising
out of or relating to this Agreement or the other Loan Documents, or for
recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in such New York State or,
to the extent permitted by law, in such Federal court. Each of the parties
hereto agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this Agreement shall affect any
right that the Administrative Agent, the Collateral Trustee or each other Senior
Lender may otherwise have to bring any action or proceeding relating to this
Agreement against any Subordinated Lender or its respective properties in the
courts of any jurisdiction.

(c) Each Subordinated Lender hereby irrevocably and unconditionally waives, to
the fullest extent it may legally and effectively do so, any objection which it
may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement or the other Loan
Documents in any New York State or Federal court. Each of the parties hereto
hereby irrevocably waives, to the fullest extent permitted by law, the defense
of an inconvenient forum to the maintenance of such action or proceeding in any
such court.

(d) Each Subordinated Lender hereby irrevocably consents to service of process
in the manner provided for notices in Section 11. Nothing in this Agreement, the
Credit

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

Exhibit F

to Credit Agreement

 

Agreement or any other Loan Document will affect the right of any party to this
Agreement to serve process in any other manner permitted by law.

SECTION 19. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER
OR IN CONNECTION WITH THIS AGREEMENT, THE CREDIT AGREEMENT OR ANY OTHER LOAN
DOCUMENT. EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN
INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS, BY, AMONG
OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 19.

SECTION 20. ADDITIONAL SUBORDINATED LENDERS. UPON EXECUTION AND DELIVERY BY THE
ADMINISTRATIVE AGENT AND A SUBSIDIARY OF AN INSTRUMENT SUBSTANTIALLY IN THE FORM
OF ANNEX 2 ATTACHED HERETO, SUCH SUBSIDIARY SHALL BECOME A SUBORDINATED LENDER
AND A SUBORDINATED BORROWER HEREUNDER WITH THE SAME FORCE AND EFFECT AS IF
ORIGINALLY NAMED AS A SUBORDINATED LENDER AND A SUBORDINATED BORROWER HEREIN.
THE EXECUTION AND DELIVERY OF ANY SUCH INSTRUMENT SHALL NOT REQUIRE THE CONSENT
OF ANY OTHER SUBORDINATED LENDER OR SUBORDINATED BORROWER HEREUNDER. THE RIGHTS
AND OBLIGATIONS OF EACH SUBORDINATED BORROWER AND EACH SUBORDINATED LENDER
HEREIN SHALL REMAIN IN FULL FORCE AND EFFECT NOTWITHSTANDING THE ADDITION OF ANY
SUBORDINATED LENDER AND SUBORDINATED BORROWER AS A PARTY TO THIS AGREEMENT.

SECTION 21. TERMINATION OR RELEASE.

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Exhibit F

to Credit Agreement

 

(a) This Agreement and any Subordinated Obligations created hereby shall remain
in full force and effect until payment in full of the Obligations, at which time
this Agreement shall terminate (other than Section 18 and Section 19 hereof,
which Sections shall survive such termination); provided that such termination
shall be subject in all respects to the provisions of Section 22 hereof.

 

  (b) A Subordinated Borrower or Subordinated Lender shall be released from its
obligations hereunder upon both (i) the consummation of any transaction
permitted by the Credit Agreement and permitted (if addressed therein or,
otherwise, not prohibited) by the other applicable Loan Documents as a result of
which such Subordinated Borrower or Subordinated Lender ceases to be a
Subsidiary and (ii) in the case of a Subordinated Borrower, forgiveness or
repayment of all the Subordinated Obligations of such Subordinated Borrower
pursuant to the terms of this Agreement; provided that upon an occurrence
decribed in clause (i) above with respect to a Subordinated Borrower and prior
to the occurrence of the events required by clause (ii) above, only the
Subordinated Obligations that existed on the date that such Subordinated
Borrower ceased to be a Subsidiary of the Borrower shall be subject to the
provisions hereof.

SECTION 22. REINSTATEMENT.

If any Senior Lender is required in any insolvency, dissolution, wind-up,
reorganization, assignment for the benefit of creditors, liquidation or
voluntary or involuntary case or proceeding, similar proceeding under a Debtor
Relief Law or otherwise to turn over or otherwise pay to the estate of any
Subordinated Borrower any amount paid in respect of the Senior Obligations (a
“Recovery”), then such Senior Lender shall be entitled to a reinstatement of
Senior Obligations with respect to all such recovered amounts. In such event, if
the termination referred to in Section 21 hereof shall have occurred prior to
such Recovery, this Agreement shall be reinstated in full force and effect, and
such prior termination shall not diminish, release, discharge, impair or
otherwise affect the obligations of the parties hereto from such date of
reinstatement.

(Signature page follows)

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

Exhibit F

to Credit Agreement

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered as of the day and year first above written.

 

DYNEGY MIDWEST GENERATION, LLC By:  

 

  Name:   Title:

 

HAVANA DOCK ENTERPRISES, LLC By:  

 

  Name:   Title:

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

Exhibit F

to Credit Agreement

 

CREDIT SUISSE AG, CAYMAN ISLANDS

BRANCH, as Administrative Agent

By:

 

 

  Name:   Title:

By:

 

 

  Name:   Title:

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

Exhibit F

to Credit Agreement

 

Schedule 1 to

Affiliate Subordination Agreement

SUBORDINATED LENDERS

Dynegy Midwest Generation, LLC

Havana Dock Enterprises, LLC

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

Exhibit F

to Credit Agreement

 

Schedule 2 to

Affiliate Subordination Agreement

SUBORDINATED BORROWERS

Dynegy Midwest Generation, LLC

Havana Dock Enterprises, LLC

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

Exhibit F

to Credit Agreement

 

Annex 1 to

Affiliate Subordination Agreement

INTERCOMPANY SUBORDINATED DEMAND PROMISSORY NOTE

Note Number: [    ]

Dated: [                    ], 20[    ]

FOR VALUE RECEIVED, DYNEGY MIDWEST GENERATION, LLC, a Delaware limited liability
company (the “Borrower”), and its Subsidiaries (collectively, the “Group
Members” and each, a “Group Member”) which is a party to this intercompany
subordinated demand promissory note (the “Promissory Note”) promises to pay to
the order of such other Group Member as makes loans to such Group Member (each
Group Member which borrows money pursuant to this Promissory Note is referred to
herein as a “Payor” and each Group Member which makes loans and advances
pursuant to this Promissory Note is referred to herein as a “Payee”), on demand,
in lawful money of the United States of America, in immediately available funds
and at the appropriate office of the Payee, the aggregate unpaid principal
amount of all loans and advances heretofore and hereafter made by such Payee to
such Payor and any other indebtedness now or hereafter owing by such Payor to
such Payee as shown either on Schedule A attached hereto (and any continuation
thereof) or in the books and records of such Payee. The failure to show any such
Indebtedness or any error in showing such Indebtedness shall not affect the
obligations of any Payor hereunder. Capitalized terms used herein but not
otherwise defined herein shall have the meanings given such terms in the Credit
Agreement dated as of August 5, 2011 (as may be amended, restated, replaced,
refinanced, supplemented or otherwise modified from time to time, the “Credit
Agreement”; capitalized terms used herein and not otherwise defined herein shall
have the meanings assigned to such terms in the Credit Agreement), among the
Borrower, DYNEGY COAL INVESTMENTS

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

Exhibit F

to Credit Agreement

 

HOLDINGS, LLC, a Delaware limited liability company, the lenders from time to
time party thereto (the “Lenders”) and CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH,
as administrative agent for the Lenders (in such capacity, including any
successor thereto, the “Administrative Agent”) and as Collateral Trustee for the
Secured Parties, and the other banks, other financial institutions and entities
party thereto from time to time.

The unpaid principal amount hereof from time to time outstanding shall bear
interest at a rate equal to the rate as may be agreed upon from time to time by
the relevant Payor and Payee. Interest shall be due and payable on the last day
of each month commencing after the date hereof or at such other times as may be
agreed upon from time to time by the relevant Payor and Payee. Upon demand for
payment of any principal amount hereof, accrued but unpaid interest on such
principal amount shall also be due and payable. Interest shall be paid in lawful
money of the United States of America and in immediately available funds.
Interest shall be computed for the actual number of days elapsed on the basis of
a year consisting of 365 days.

Each Payor and any endorser of this Promissory Note hereby waives presentment,
demand, protest and notice of any kind. No failure to exercise, and no delay in
exercising, any rights hereunder on the part of the holder hereof shall operate
as a waiver of such rights.

This Promissory Note has been pledged by each Payee to the Administrative Agent,
for the benefit of the Secured Parties, as security for such Payee’s
obligations, if any, under the Credit Agreement and each other Loan Document to
which such Payee is a party. Each Payor acknowledges and agrees that the
Administrative Agent and the other Secured Parties may exercise all the rights
of the Payees under this Promissory Note and will not be subject to any
abatement, reduction, recoupment, defense, setoff or counterclaim available to
such Payor.

Notwithstanding anything contained herein to the contrary, neither the principal
of nor the interest on, nor any other amounts payable in respect of, the
indebtedness created or evidenced by this instrument or record shall become due
or be paid or payable, except to the extent permitted under the Affiliate
Subordination Agreement, dated as of [                    ], 20[    ] (as may be
amended, restated, replaced, supplemented or otherwise modified from time to
time, the “Affiliate Subordination Agreement”), among the Subordinated Lenders
(as defined in the Affiliate Subordination Agreement), the Subordinated
Borrowers (as defined in the Affiliate Subordination Agreement) and the
Administrative Agent, which Affiliate Subordination Agreement is incorporated
herein with the same effect as if fully set forth herein.

Notwithstanding anything to the contrary contained herein, in any other
agreement or in any such promissory note or other instrument, this Promissory
Note (i) replaces and supersedes any and all promissory notes or other
instruments which create or evidence any loans or advances made on or before the
date hereof by any Group Member to any other Group Member and (ii) without the
written consent of the Administrative Agent, shall not be deemed replaced,
superseded or in any way modified by any promissory note or other

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

Exhibit F

to Credit Agreement

 

instrument entered into on or after the date hereof which purports to create or
evidence any loan or advance by any Group Member to any other Group Member.

THIS PROMISSORY NOTE AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS
PROMISSORY NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS
OF THE STATE OF NEW YORK.

From time to time after the date hereof, additional subsidiaries of the Group
Members may become parties hereto by executing a counterpart signature page to
this Promissory Note (each additional subsidiary, an “Additional Payor”). Upon
delivery of such counterpart signature page to the Payees, notice of which is
hereby waived by the other Payors, each Additional Payor shall be a Payor and
shall be as fully a party hereto as if such Additional Payor were an original
signatory hereof. Each Payor expressly agrees that its obligations arising
hereunder shall not be affected or diminished by the addition or release of any
other Payor hereunder. This Promissory Note shall be fully effective as to any
Payor that is or becomes a party hereto regardless of whether any other Person
becomes or fails to become or ceases to be a Payor hereunder.

This Promissory Note may be executed in counterparts (and by different parties
hereto on different counterparts), each of which shall constitute an original
but all of which taken together shall constitute a single contract. Delivery of
an executed signature page to this Promissory Note by facsimile (or other
electronic) transmission shall be as effective as delivery of a manually signed
counterpart of this Promissory Note.

(Signature page follows)

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

Exhibit F

to Credit Agreement

 

IN WITNESS WHEREOF, each Payor has caused this Promissory Note to be executed
and delivered by its proper and duly authorized officer as of the date set forth
above.

 

DYNEGY MIDWEST GENERATION, LLC

By:

 

 

 

Name:

Title:

 

HAVANA DOCK ENTERPRISES, LLC

By:

 

 

 

Name:

Title:

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

Exhibit F

to Credit Agreement

 

Schedule A

TRANSACTIONS

ON

INTERCOMPANY SUBORDINATED DEMAND PROMISSORY NOTE

 

Date

   Name of
Payor    Name of
Payee    Amount of
Advance
This Date    Amount of
Principal
Paid on this
Date    Outstanding
Principal
Balance from
Payor to
Payee on
This Date    Notation Made
By

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

Exhibit F

to Credit Agreement

 

ENDORSEMENT

Dated: [                    ], 20[    ]

FOR VALUE RECEIVED, each of the undersigned does hereby sell, assign and
transfer to                      all of its right, title and interest in and to
the Intercompany Subordinated Demand Promissory Note, dated as of
[                    ], 20[    ] (as amended, restated, supplemented or
otherwise modified from time to time, the “Promissory Note”), made by Dynegy
Midwest Generation, LLC, a Delaware limited liability company, and each of its
Subsidiaries or any other person that is or becomes a party thereto, and payable
to the undersigned. This endorsement is intended to be attached to the
Promissory Note and, when so attached, shall constitute an endorsement thereof.

The initial undersigned shall be the Group Members (as defined in the Promissory
Note) party to the Affiliate Subordination Agreement on the date of the
Promissory Note. From time to time after the date thereof, additional
subsidiaries of the Group Members shall become parties to the Promissory Note
(each, an “Additional Payee”) and a signatory to this endorsement by executing a
counterpart signature page to the Promissory Note and to this endorsement. Upon
delivery of such counterpart signature page to the Payors (as defined in the
Promissory Note), notice of which is hereby waived by the other Payees (as
defined in the Promissory Note), each Additional Payee shall be a Payee and
shall be as fully a Payee under the Promissory Note and a signatory to this
endorsement as if such Additional Payee were an original Payee under the
Promissory Note and an original signatory hereof. Each Payee expressly agrees
that its obligations arising under the Promissory Note and hereunder shall not
be affected or diminished by the addition or release of any other Payee under
the Promissory Note or hereunder. This endorsement shall be fully effective as
to any Payee that is or becomes a signatory hereto regardless of whether any
other Person becomes or fails to become or ceases to be a Payee to the
Promissory Note or hereunder.

(Signature page follows)

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

DYNEGY MIDWEST GENERATION, LLC By:  

 

  Name:   Title:

 

HAVANA DOCK ENTERPRISES, LLC By:  

 

  Name:   Title:

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

Exhibit F

to Credit Agreement

 

Annex 2 to the

Affiliate Subordination Agreement

SUPPLEMENT NO. [    ] dated as of [                    ], 20[    ] (this
“Supplement”), to the Affiliate Subordination Agreement dated as of
[                    ], 20[    ] (the “Affiliate Subordination Agreement”),
among the subordinated lenders named therein (the “Subordinated Lenders”), the
subordinated borrowers named therein (the “Subordinated Borrowers”) and Credit
Suisse AG, Cayman Islands Branch, as administrative agent (in such capacity,
including any successor thereto, the “Administrative Agent”) for the Senior
Lenders.

A. Reference is made to the Affiliate Subordination Agreement.

B. Capitalized terms used herein and not otherwise defined herein shall have the
meanings assigned to such terms in the Affiliate Subordination Agreement.

C. Each of the Subordinated Lenders and each of the Subordinated Borrowers have
entered into the Affiliate Subordination Agreement in order to induce the Senior
Lenders to make Term Loans and other extensions of credit under the Credit
Agreement. Section 20 of the Affiliate Subordination Agreement provides that
subsidiaries of the Borrower may become Subordinated Lenders and Subordinated
Borrowers under the Affiliate Subordination Agreement by execution and delivery
of an instrument in the form of this Supplement. The undersigned Subsidiary (the
“New Subordinated Party”) is executing this Supplement to become a Subordinated
Lender and a Subordinated Borrower under the Affiliate Subordination Agreement
in accordance with the terms of the Credit Agreement as consideration for Term
Loans previously made or issued under the Credit Agreement.

Accordingly, the Administrative Agent and the New Subordinated Party agree as
follows:

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

Exhibit F

to Credit Agreement

 

SECTION 1. IN ACCORDANCE WITH SECTION 20 OF THE AFFILIATE SUBORDINATION
AGREEMENT, THE NEW SUBORDINATED PARTY BY ITS SIGNATURE BELOW BECOMES A
SUBORDINATED LENDER AND A SUBORDINATED BORROWER UNDER THE AFFILIATE
SUBORDINATION AGREEMENT WITH THE SAME FORCE AND EFFECT AS IF ORIGINALLY NAMED
THEREIN AS A SUBORDINATED LENDER AND A SUBORDINATED BORROWER AND THE NEW
SUBORDINATED PARTY HEREBY (A) AGREES TO ALL THE TERMS AND PROVISIONS OF THE
AFFILIATE SUBORDINATION AGREEMENT APPLICABLE TO IT AS A SUBORDINATED LENDER AND
A SUBORDINATED BORROWER THEREUNDER AND (B) REPRESENTS AND WARRANTS THAT THE
REPRESENTATIONS AND WARRANTIES MADE BY IT AS A SUBORDINATED LENDER AND A
SUBORDINATED BORROWER THEREUNDER ARE TRUE AND CORRECT IN ALL MATERIAL RESPECTS,
EXCEPT THAT SUCH MATERIALITY QUALIFIER SHALL NOT BE APPLICABLE TO ANY
REPRESENTATION THAT IS ALREADY QUALIFIED BY MATERIALITY, ON AND AS OF THE DATE
HEREOF EXCEPT FOR REPRESENTATIONS AND WARRANTIES WHICH BY THEIR TERMS REFER TO A
SPECIFIC DATE, WHICH REPRESENTATIONS AND WARRANTIES WERE TRUE AND CORRECT ON
SUCH SPECIFIC DATE. EACH REFERENCE TO A “SUBORDINATED LENDER” OR A “SUBORDINATED
BORROWER” IN THE AFFILIATE SUBORDINATION AGREEMENT SHALL BE DEEMED TO INCLUDE
THE NEW SUBORDINATED PARTY. THE AFFILIATE SUBORDINATION AGREEMENT IS HEREBY
INCORPORATED HEREIN BY REFERENCE.

SECTION 2. THE NEW SUBORDINATED PARTY REPRESENTS AND WARRANTS TO THE
ADMINISTRATIVE AGENT AND THE OTHER SENIOR LENDERS THAT THIS SUPPLEMENT HAS BEEN
DULY AUTHORIZED, EXECUTED AND DELIVERED BY IT AND CONSTITUTES ITS LEGAL, VALID
AND BINDING OBLIGATION, ENFORCEABLE AGAINST IT IN ACCORDANCE WITH ITS TERMS,
EXCEPT AS ENFORCEABILITY MAY BE LIMITED BY APPLICABLE BANKRUPTCY, INSOLVENCY OR
SIMILAR LAWS AFFECTING THE ENFORCEMENT OF CREDITORS’ RIGHTS GENERALLY OR BY
EQUITABLE PRINCIPLES RELATING TO ENFORCEABILITY.

SECTION 3. THIS SUPPLEMENT MAY BE EXECUTED IN COUNTERPARTS (AND BY DIFFERENT
PARTIES HERETO ON DIFFERENT COUNTERPARTS), EACH OF WHICH SHALL CONSTITUTE AN
ORIGINAL, BUT ALL OF WHICH WHEN TAKEN TOGETHER SHALL CONSTITUTE A SINGLE
CONTRACT. DELIVERY OF AN EXECUTED SIGNATURE PAGE TO THIS SUPPLEMENT BY FACSIMILE
(OR OTHER ELECTRONIC) TRANSMISSION SHALL BE AS EFFECTIVE AS DELIVERY OF A
MANUALLY SIGNED COUNTERPART OF THIS SUPPLEMENT. THIS SUPPLEMENT SHALL BECOME
EFFECTIVE WHEN THE ADMINISTRATIVE AGENT SHALL HAVE RECEIVED COUNTERPARTS OF THIS
SUPPLEMENT THAT, WHEN TAKEN TOGETHER, BEAR THE SIGNATURES OF THE NEW
SUBORDINATED PARTY AND THE ADMINISTRATIVE AGENT.

SECTION 4. EXCEPT AS EXPRESSLY SUPPLEMENTED HEREBY, THE AFFILIATE SUBORDINATION
AGREEMENT SHALL REMAIN IN FULL FORCE AND EFFECT.

SECTION 5. THIS SUPPLEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY
THE LAWS OF THE STATE OF NEW YORK.

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

Exhibit F

to Credit Agreement

 

SECTION 6. IN THE EVENT THAT ANY ONE OR MORE OF THE PROVISIONS CONTAINED IN THIS
SUPPLEMENT SHOULD BE HELD INVALID, ILLEGAL OR UNENFORCEABLE IN ANY RESPECT, THE
VALIDITY, LEGALITY AND ENFORCEABILITY OF THE REMAINING PROVISIONS CONTAINED
HEREIN AND IN THE AFFILIATE SUBORDINATION AGREEMENT SHALL NOT IN ANY WAY BE
AFFECTED OR IMPAIRED THEREBY (IT BEING UNDERSTOOD THAT THE INVALIDITY OF A
PARTICULAR PROVISION HEREOF IN A PARTICULAR JURISDICTION SHALL NOT IN AND OF
ITSELF AFFECT THE VALIDITY OF SUCH PROVISION IN ANY OTHER JURISDICTION). THE
PARTIES HERETO SHALL ENDEAVOR IN GOOD-FAITH NEGOTIATIONS TO REPLACE THE INVALID,
ILLEGAL OR UNENFORCEABLE PROVISIONS WITH VALID PROVISIONS THE ECONOMIC EFFECT OF
WHICH COMES AS CLOSE AS POSSIBLE TO THAT OF THE INVALID, ILLEGAL OR
UNENFORCEABLE PROVISIONS.

SECTION 7. ALL COMMUNICATIONS AND NOTICES HEREUNDER SHALL BE IN WRITING AND
GIVEN AS PROVIDED IN SECTION 11 OF THE AFFILIATE SUBORDINATION AGREEMENT. ALL
COMMUNICATIONS AND NOTICES HEREUNDER TO THE NEW SUBORDINATED PARTY SHALL BE
GIVEN TO IT AT THE ADDRESS SET FORTH UNDER ITS SIGNATURE BELOW, WITH A COPY TO
THE BORROWER.

SECTION 8. THE NEW SUBORDINATED PARTY SHALL REIMBURSE AND INDEMNIFY THE
ADMINISTRATIVE AGENT, THE COLLATERAL TRUSTEE AND EACH OTHER SENIOR LENDER IN THE
MANNER PROVIDED IN SECTION 9.05 OF THE CREDIT AGREEMENT.

(Signature page follows)

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

Exhibit F

to Credit Agreement

 

IN WITNESS WHEREOF, the New Subordinated Party and the Administrative Agent have
duly executed this Supplement to the Affiliate Subordination Agreement as of the
day and year first above written.

 

[NAME OF NEW SUBORDINATED PARTY],
as New Subordinated Party By:  

 

  Name:   Title: CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, as Administrative
Agent By:  

 

  Name:   Title:

By:

 

 

  Name:   Title:

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

Exhibit G

to Credit Agreement

 

FORM OF LOCAL COUNSEL OPINION

[Counsel Letterhead]

                    , 200    

[INSERT AGENT]

 

 

 

 

 

  Re:

[Loan (the “Loan”), in the original principal amount of up to $             made
by the lenders (the “Lenders”) party from time to time to that certain Credit
Agreement (the “Credit Agreement”), by and among                     , as
Borrower (“Borrower” [or “Mortgagor”]1) , [certain Subsidiaries of the Borrower,
as Guarantors,] the Lenders party thereto from time to time,
                    , as Administrative Agent, (the “Agent”)2,
                    , as sole bookrunner, and                      and
                    , as co-lead arrangers, dated as of                     ,
200    .]

Ladies and Gentlemen:

We have acted as special                      (the “State”) counsel for Borrower
in connection with the Loan. All capitalized terms not otherwise defined herein
shall have the meanings ascribed to them in the Credit Agreement.

In rendering the opinions expressed below, we have examined the original, or
copies certified or otherwise authenticated to our satisfaction, of the
documents set forth below and such other certificates, documents and materials
as we have deemed necessary as a basis for such opinions. Except as otherwise
noted, all of the following documents are dated as of the date hereof.

 

1 

Include or delete depending on whether Mortgagor is Borrower or an affiliate or
subsidiary of Borrower

2 

If necessary, modify defined term Agent to be Collateral Agent or other party to
whom the Mortgage is being delivered.

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

Exhibit G

to Credit Agreement

 

  1. the Credit Agreement;

 

  2. the Promissory Note in the original principal amount of $             made
by Borrower to Lender (the “Note”);

 

  3. the [Mortgage] [Deed of Trust] [Deed to Secure Debt], Security Agreement,
Assignment of Rents and Leases, Security Agreement and Fixture Filing, made by
one or more of Borrower (“Mortgagor”) to the Lender (the “Mortgage”);

 

  4. the [Assignment of Leases and Rents, made by Mortgagor to the Lender]; and

 

  5. certificate of authority to conduct business in the State of
                     issued by                      on                     ,
2010.

 

     [Insert reference to additional Mortgages or security documents as
necessary.]

 

     [Add UCC fixture filings if Mortgage is insufficient alone.]

The documents listed as items 1 through [4] above are sometimes collectively
referred to herein as the “Documents”.3

For purposes of this opinion, we have, with your permission, assumed without
independent investigation that:

(i) the documents submitted to us as originals are authentic and the documents
submitted to us as copies conform to the original documents;

(ii) [other than with respect to Mortgagor,]4 the Documents have been duly
authorized, executed and delivered by each of the parties thereto; and

(iii) [other than with respect to Mortgagor,]5 the persons who executed,
acknowledged and delivered the Documents on behalf of each of the parties
thereto were duly authorized to do so by each such party.

 

 

3 

May be eliminated if only one mortgage is being addressed. Reference to
“Documents” should be changed to “Mortgage” globally.

4 

May be deleted if being addressed by Borrower’s primary counsel.

5 

May be deleted if being addressed by Borrower’s primary counsel.

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

Exhibit G

to Credit Agreement

 

Based upon the foregoing, we are of the opinion that:

1. Except for filings which are necessary to perfect the security interests
granted under the Documents and such other filings, authorizations or approvals
as are specifically contemplated by the Documents, no authorizations or
approvals of, and no filings with, any governmental or regulatory authority or
agency of the United States or the State are necessary for the execution,
delivery or performance of the Documents by the Mortgagor.

2. Each of the Documents constitutes the legal, valid and binding obligation of
Mortgagor, enforceable against Mortgagor in accordance with its terms.

3. The execution and delivery by the Mortgagor of the Documents and the
consummation of the transactions contemplated thereby do not conflict with or
violate any federal or State law, rule, regulation or ordinance applicable to
Mortgagor.

4. The choice of law provisions contained in the Documents will be upheld and
enforced by the courts of the State and Federal courts sitting in and applying
the laws of the State.

5. The Mortgage to be recorded in the State creates valid security interests in
favor of Agent in the Mortgaged Property to the extent the Uniform Commercial
Code as in effect in the State (the “UCC”) is applicable thereto (the “UCC
Collateral”), as security for the payment or performance of the Obligations (as
defined in such Mortgage). The security interests described in this Paragraph 5
are referred to as the “Security Interests.”

6. The Mortgage to be recorded in the State is in form satisfactory for
recording. The recording of the Mortgage in the office of
                                 for the County of                     , [and
the filing and recording of the Financing Statements referred to on Schedule 1
hereto in the offices shown on Schedule 1 hereto,]6 [is][are] the only
recordings or filings necessary to publish notice of and to establish of record
the rights of the parties thereto and to perfect the liens and security
interests granted by Mortgagor pursuant to the Mortgage in the real property
(including that portion of the UCC Collateral constituting fixtures) covered
thereby. [The Financing Statements comply in all respects with applicable
provisions of the UCC and are in appropriate form for filing or recording and
the description therein of the property covered thereby is adequate to permit
the perfection of such security interests.]7 Upon the execution and delivery of
such Mortgage, such liens and security interests shall be created and upon the
recording and filing of the Mortgage [and the Financing Statements]8 as
aforesaid, such liens and security interests shall be perfected. No documents or
instruments other than those referred to in this paragraph need be recorded,
registered or filed in any public office in the

 

 

6 

Include only if separate UCC filings (apart from the Mortgage) are required to
perfect the applicable security interests (such as in GA).

7 

Include only if separate UCC filings (apart from the Mortgage) are required.

8 

Include only if separate UCC filings (apart from the Mortgage) are required.

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

Exhibit G

to Credit Agreement

 

State in order to publish notice of the applicable Mortgage or to perfect such
liens and security interests or for the validity or enforceability of any of the
Documents or to permit Lenders to enforce their rights thereunder in the courts
of the State.

7. Except for                     , no recording, filing, privilege or other tax
must be paid by either the Mortgagor or Lenders in connection with the
execution, delivery, recordation or enforcement of any of the Documents.

8. The Loan, as made, will not violate any applicable usury laws of the State,
or other applicable laws regulating the interest rate, fees and other charges
that may be collected with respect to the Loan.

9. It is not necessary for Lenders to qualify to do business in the State solely
to make the Loan and enforce the provisions of the Documents. The making of the
Loan and enforcement of the provisions of the Documents will not result in the
imposition upon Lenders of any taxes of the State, or any subdivision thereof in
which the applicable Mortgaged Property is located (including, without
limitation, franchise, license, tax on interest received or income taxes), other
than taxes which Lenders, if and when it becomes the actual and record owner of
such Mortgaged Property, by reason of power of sale or foreclosure under the
applicable Mortgage or by deed in lieu of foreclosure, would be required to pay.
Lenders are not in violation of any banking law of the State by carrying out the
transactions contemplated by the Documents.

10. The foreclosure of the Mortgage to be recorded in the State, exercise of
Agent’s power of sale, or exercise of any other remedy provided in the Mortgage
will not in any manner restrict, affect or impair the liability of Mortgagor
with respect to the indebtedness secured thereby or the rights and remedies of
Agent with respect to the foreclosure or enforcement of any other security
interests or liens securing such indebtedness, to the extent any deficiency
remains unpaid after application of the proceeds of the foreclosure of such
Mortgage, exercise of such power of sale or as a result of the exercise of any
other remedy.

11. The Mortgage contains the terms and provisions necessary to enable Agent,
following a default under the Mortgage, to exercise the remedies that are
customarily available to a lienholder under the laws of the State.

12. The priority of the lien of the Mortgage to be recorded in the State in
respect of all advances or extensions of credit made by Lenders under the Credit
Agreement on, before or after the date on which such Mortgage is recorded in the
appropriate recording office referred to in Paragraph 6 above will be determined
by the date of such recording.

13. The priority of the lien of the Mortgage will not be affected by (a) any
prepayment of a portion of the Loan, or (b) any increase in or reduction of the
outstanding amount of the Loan from time to time.

14. Mortgagor is qualified to transact business in the State.

Our opinions expressed above are subject to the following qualifications:

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

Exhibit G

to Credit Agreement

 

(a) We express no opinion as to Mortgagor’s right in or title to any of the
Mortgaged Property.

(b) Such opinion as to perfection of the Security Interests are subject to the
assumption that Agent has not waived, subordinated or agreed with any third
party to any modification of the perfection of any of the Security Interests.

(c) We assume that none of the UCC Collateral consists or will consist of
consumer goods, farm products, crops, timber, minerals and the like or accounts
resulting from the sale thereof.

All of our foregoing opinions are subject to the qualifications that the
enforceability of any of the Documents may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws of general
application affecting the enforcement of creditors’ rights.

This opinion is limited to the laws of the State and the applicable federal
laws.

This opinion and is rendered as of the effective date set forth above, and we
express no opinion as to circumstances or events which may occur subsequent to
such date.

This opinion may only be relied upon by Agent, its successors and/or assigns in
such capacity and the Lenders party to the Credit Agreement from time to time,
their successors, assigns and participants and by no other person or entity. Any
such parties may furnish a copy of this opinion letter: (a) to their accountants
and counsel, (b) to bank or other government regulatory examiners or the NAIC,
(c) to any rating agency participating in a securitization of the Loan, (d) to
any rating agency rating lenders, (e) pursuant to judicial process or government
order or requirement, and (f) to prospective permitted assignees of, and
permitted participants in the interests of the Lenders under the Credit
Agreement or the Mortgage.

Very truly yours,

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

Exhibit H

to Credit Agreement

 

FORM OF COMPLIANCE CERTIFICATE

of

DYNEGY MIDWEST GENERATION, LLC

The undersigned hereby certifies that he or she is the Financial Officer of
Dynegy Midwest Generation, LLC, a Delaware limited liability company (the
“Borrower”), and certifies on behalf of the Borrower, and not in his or her
individual capacity, as follows:

I have reviewed the terms of the Credit Agreement dated as of August 5, 2011 (as
may be amended, restated, replaced, refinanced, supplemented or otherwise
modified from time to time, the “Credit Agreement”; capitalized terms used
herein and not otherwise defined herein shall have the meanings assigned to such
terms in the Credit Agreement), among the Borrower, DYNEGY COAL INVESTMENTS
HOLDINGS, LLC, a Delaware limited liability company, the lenders from time to
time party thereto (the “Lenders”) and CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH,
as administrative agent for the Lenders (in such capacity, including any
successor thereto, the “Administrative Agent”) and as Collateral Trustee for the
Secured Parties, and the other banks, other financial institutions and entities
party thereto from time to time, and I have made, or have caused to be made
under my supervision, a review in reasonable detail of the transactions and
condition of the Borrower and its Subsidiaries during the accounting period
covered by the attached financial statements.

Section references in this Compliance Certificate (this “Compliance
Certificate”) relate to the Credit Agreement unless stated otherwise. In the
event of any conflict between the calculations set forth in this Compliance
Certificate and the manner of calculation required by the Credit Agreement, the
terms of the Credit Agreement shall govern and control.

The examinations described in the second paragraph above did not disclose the
existence of any condition or event which constitutes an Event of Default or
Default as of the date of this Compliance Certificate, except as set forth in a
separate attachment, if any, to this Compliance Certificate, specifying the
nature and extent thereof and the corrective action taken or proposed to be
taken with respect thereto by the Borrower.

This Compliance Certificate is delivered in accordance with Section 5.04(c) of
the Credit Agreement. This Compliance Certificate is delivered for the fiscal
[quarter][year] (the “Test Period”) ended [            ], 20[    ]_(the “Test
Date”). Computations indicating compliance with respect to the covenant in
Sections 6.10 of the Credit Agreement are set forth at Section 1 of Annex A.
[Computations showing the Borrower’s calculation of Excess Cash Flow are set
forth at Section 2 of Annex A.]1 Computations showing the Borrower’s reasonable
determination of

 

 

1 

Delivery of computations on Section 2 of Annex A are required only in connection
with financials statements delivered pursuant to paragraph (a) of Section 5.04
of the Credit Agreement.

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

Exhibit H

to Credit Agreement

 

the net mark-to-market position for the Interest Rate/Currency Hedging Agreement
and Eligible Commodity Hedging Agreements, in each case secured by Liens
permitted pursuant to Section 6.02(k) of the Credit Agreement, then outstanding
for each counterparty are set forth at Section 3 of Annex A.

(Signature page follows)

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

Exhibit H

to Credit Agreement

 

The foregoing certifications, together with the computations set forth in Annex
A hereto and the financial statements delivered with this Compliance Certificate
in support hereof, are made and delivered as of [            ], 20[    ]
pursuant to Section 5.04(c) of the Credit Agreement.

 

DYNEGY MIDWEST GENERATION, LLC By:       Name:   Title: Chief Financial Officer

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

Exhibit H

to Credit Agreement

 

Annex A

to Compliance Certificate

FOR THE FISCAL [QUARTER][YEAR] ENDING [            ], 20[    ].

1. Section 6.10 – Maximum Capital Expenditures. The aggregate amount of Capital
Expenditures made by the Loan Parties for the fiscal year to date is
$                    .

Capital Expenditures for the fiscal year to date were computed as follows:

[Attach detailed calculation]

 

The maximum aggregate Capital Expenditures for

fiscal year 201[—] is:

   $                    

In compliance

   [YES][NO]

2. Excess Cash Flow.1

The Excess Cash Flow as of the Test Date was computed as follows:

[Attach detailed calculation]

 

The Excess Cash Flow as of the Test Date is:

   $            

3. Interest Rate/Currency Hedging Agreements and Eligible Commodity Hedging
Agreements.

[Attach detailed description]

 

1 

Delivery of computations on Section 2 of Annex A are required only in connection
with financials statements delivered pursuant to paragraph (a) of Section 5.04
of the Credit Agreement.

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

Exhibit I-1

to Credit Agreement

 

U.S. TAX COMPLIANCE CERTIFICATE

(For Non-U.S. Lenders That Are Not Partnerships for U.S. Federal Income Tax
Purposes)

[Letterhead of Non-U.S. Lender]

Date: [            ,     ]

Credit Suisse AG, Cayman Islands Branch

as Administrative Agent

 

 

  

 

  

Attention: [                    ]

Phone: [                    ]

Facsimile: [                    ]

Email: [                    ]

Dynegy Midwest Generation, LLC

 

  

 

  

 

  

 

  

 

  

Email:                  

Re:    Dynegy Midwest Generation, LLC – Non-U.S. Lender Certificate

Ladies and Gentlemen:

This U.S. Tax Compliance Certificate is delivered to you pursuant to
Section 2.20(e) of the Credit Agreement, dated as of August 5, 2011 (as amended,
restated, amended and restated, supplemented or otherwise modified from time to
time, the “Credit Agreement”), by and among Dynegy Midwest Generation, LLC, a
Delaware limited liability company (the “Borrower”), Dynegy Coal Investments
Holdings, LLC, a Delaware limited liability company, the Lenders party thereto
from time to time, Credit Suisse AG, Cayman Islands Branch, as administrative
agent and as collateral agent, Credit Suisse Securities (USA) LLC and Goldman
Sachs Lending Partners LLC, as Joint Bookrunners and Joint Lead Arrangers, and
Credit Suisse Securities (USA) LLC and Goldman Sachs Lending Partners LLC, as
Joint Syndication Agents and Co-Documentation Agents. Unless otherwise defined
herein, capitalized terms used herein have the meanings provided in the Credit
Agreement.

 

I-1-1

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

Exhibit I-1

to Credit Agreement

 

[Insert name of applicable Lender] (“Non-U.S. Lender”) is providing this U.S.
Tax Compliance Certificate pursuant to Section 2.20(e) of the Credit Agreement.
Non-U.S. Lender hereby represents and warrants that:

1. Non-U.S. Lender is the sole record and beneficial owner of the Loans in
respect of which it is providing this U.S. Tax Compliance Certificate. Non-U.S.
Lender is not a “bank” for purposes of Section 881(c)(3)(A) of the Internal
Revenue Code of 1986, as amended (the “Code”);

2. Non-U.S. Lender is not a 10-percent shareholder of the Borrower within the
meaning of Section 871(h)(3)(B) or 881(c)(3)(B) of the Code; and

3. Non-U.S. Lender is not a controlled foreign corporation receiving interest
from a related person within the meaning of Section 881(c)(3)(C) of the Code.

The undersigned has furnished the Administrative Agent and the Borrower with a
certificate of its non-U.S. Person status on IRS Form W-8BEN. By executing this
certificate, the undersigned agrees that (1) if the information provided on this
certificate changes, the undersigned shall promptly so inform the Borrower and
the Administrative Agent, and (2) the undersigned shall have at all times
furnished the Borrower and the Administrative Agent with a properly completed
and currently effective certificate in either the calendar year in which each
payment is to be made to the undersigned, or in either of the two calendar years
preceding such payments.

Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

IN WITNESS WHEREOF, the undersigned has duly executed this U.S. Tax Compliance
Certificate as of the date first written above.

 

[INSERT NAME OF NON-U.S. LENDER] By:    

Name:

Title:

 

I-1-2

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

Exhibit I-2

to Credit Agreement

 

U.S. TAX COMPLIANCE CERTIFICATE

(For Non-U.S. Participants That Are Not Partnerships for U.S. Federal Income Tax

Purposes)

[Letterhead of Non-U.S. Participant]

Date: [            ,     ]

Credit Suisse AG, Cayman Islands Branch

as Administrative Agent

 

  

 

  

Attention: [                    ]

Phone: [                    ]

Facsimile: [                    ]

Email: [                    ]

Dynegy Midwest Generation, LLC

 

  

 

  

 

  

 

  

 

  

Email:                   

Re:    Dynegy Midwest Generation, LLC – Non-U.S. Participant Certificate

Ladies and Gentlemen:

This U.S. Tax Compliance Certificate is delivered to you pursuant to
Section 2.20(e) of the Credit Agreement, dated as of August 5, 2011 (as amended,
restated, amended and restated, supplemented or otherwise modified from time to
time, the “Credit Agreement”), by and among Dynegy Midwest Generation, LLC, a
Delaware limited liability company (the “Borrower”), Dynegy Coal Investments
Holdings, LLC, a Delaware limited liability company, the Lenders party thereto
from time to time, Credit Suisse AG, Cayman Islands Branch, as administrative
agent and as collateral trustee, Credit Suisse Securities (USA) LLC and Goldman
Sachs Lending Partners LLC, as Joint Bookrunners and Joint Lead Arrangers, and
Credit Suisse Securities (USA) LLC and Goldman Sachs Lending Partners LLC, as
Joint Syndication Agents and Co-

 

I-2-1

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

Exhibit I-2

to Credit Agreement

 

Documentation Agents. Unless otherwise defined herein, capitalized terms used
herein have the meanings provided in the Credit Agreement.

[Insert name of applicable Participant] (“Non-U.S. Participant”) is providing
this U.S. Tax Compliance Certificate pursuant to Section 2.20(e) of the Credit
Agreement. Non-U.S. Participant hereby represents and warrants that:

1. Non-U.S. Participant is the sole record and beneficial owner of the
participation in respect of which it is providing this U.S. Tax Compliance
Certificate. Non-U.S. Participant is not a “bank” for purposes of
Section 881(c)(3)(A) of the Internal Revenue Code of 1986, as amended (the
“Code”);

2. Non-U.S. Participant is not a 10-percent shareholder of the Borrower within
the meaning of Section 871(h)(3)(B) or 881(c)(3)(B) of the Code; and

3. Non-U.S. Participant is not a controlled foreign corporation receiving
interest from a related person within the meaning of Section 881(c)(3)(C) of the
Code.

The undersigned has furnished the Administrative Agent and the Borrower with a
certificate of its non-U.S. Person status on IRS Form W-8BEN. By executing this
certificate, the undersigned agrees that (1) if the information provided on this
certificate changes, the undersigned shall promptly so inform the Borrower and
the Administrative Agent, and (2) the undersigned shall have at all times
furnished the Borrower and the Administrative Agent with a properly completed
and currently effective certificate in either the calendar year in which each
payment is to be made to the undersigned, or in either of the two calendar years
preceding such payments.

Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

IN WITNESS WHEREOF, the undersigned has duly executed this U.S. Tax Compliance
Certificate as of the date first written above.

 

[INSERT NAME OF NON-U.S.

PARTICIPANT]

By:

 

 

Name: Title:

 

I-2-2

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

Exhibit I-3

to Credit Agreement

 

U.S. TAX COMPLIANCE CERTIFICATE

(For Non-U.S. Participants That Are Partnerships for U.S. Federal Income Tax
Purposes)

[Letterhead of Non-U.S. Participant]

Date: [            ,     ]

Credit Suisse AG, Cayman Islands Branch

as Administrative Agent

 

  

 

  

Attention: [                    ]

Phone: [                    ]

Facsimile: [                    ]

Email: [                    ]

Dynegy Midwest Generation, LLC

 

  

 

  

 

  

 

  

 

  

Email:                   

Re:    Dynegy Midwest Generation, LLC – Non-U.S. Participant Certificate

Ladies and Gentlemen:

This U.S. Tax Compliance Certificate is delivered to you pursuant to
Section 2.20(e) of the Credit Agreement, dated as of August 5, 2011 (as amended,
restated, amended and restated, supplemented or otherwise modified from time to
time, the “Credit Agreement”), by and among Dynegy Midwest Generation, LLC, a
Delaware limited liability company (the “Borrower”), Dynegy Coal Investments
Holdings, LLC, a Delaware limited liability company, the Lenders party thereto
from time to time, Credit Suisse AG, Cayman Islands Branch, as administrative
agent and as collateral trustee, Credit Suisse Securities (USA) LLC and Goldman
Sachs Lending Partners LLC, as Joint Bookrunners and Joint Lead Arrangers, and
Credit Suisse Securities (USA) LLC and Goldman Sachs Lending Partners LLC, as
Joint Syndication Agents and Co-

 

I-3-1

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

Exhibit I-3

to Credit Agreement

 

Documentation Agents. Unless otherwise defined herein, capitalized terms used
herein have the meanings provided in the Credit Agreement.

[Insert name of applicable Participant] (“Non-U.S. Participant”) is providing
this U.S. Tax Compliance Certificate pursuant to Section 2.20(e) of the Credit
Agreement. Non-U.S. Participant hereby represents and warrants that:

1. Non-U.S. Participant is the sole record owner of the participation in respect
of which it is providing this U.S. Tax Compliance Certificate and its
partners/members are the sole beneficial owners of such participation. Neither
Non-U.S. Participant nor any of its partners/members is a “bank” for purposes of
Section 871(h) or 881(c)(3)(A) of the Internal Revenue Code of 1986, as amended
(the “Code”);

2. None of the partners/members of Non-U.S. Participant is a 10-percent
shareholder of the Borrower within the meaning of Section 871(h)(3)(B) or
881(c)(3)(B) of the Code; and

3. None of the partners/members of Non-U.S. Participant is a controlled foreign
corporation receiving interest from a related person within the meaning of
Section 881(c)(3)(C) of the Code.

The undersigned has furnished its participating Lender with IRS Form W-8IMY
accompanied by one of the following forms from each of its partners/members that
is claiming the portfolio interest exemption: (i) an IRS Form W-8BEN or (ii) an
IRS Form W-8IMY accompanied by an IRS Form W-8BEN from each of such
partner’s/member’s beneficial owners that is claiming the portfolio interest
exemption. By executing this certificate, the undersigned agrees that (1) if the
information provided on this certificate changes, the undersigned shall promptly
so inform such Lender and (2) the undersigned shall have at all times furnished
such Lender with a properly completed and currently effective certificate in
either the calendar year in which each payment is to be made to the undersigned,
or in either of the two calendar years preceding such payments.

Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

IN WITNESS WHEREOF, the undersigned has duly executed this U.S. Tax Compliance
Certificate as of the date first written above.

 

[INSERT NAME OF NON-U.S.
PARTICIPANT]

By:                                                             

Name:

 

Title:

 

 

I-3-2

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

Exhibit I-4

to Credit Agreement

 

U.S. TAX COMPLIANCE CERTIFICATE

(For Non-U.S. Lenders That Are Partnerships for U.S. Federal Income Tax
Purposes)

[Letterhead of Non-U.S. Lender]

Date: [            ,     ]

Credit Suisse AG, Cayman Islands Branch

as Administrative Agent

 

  

 

  

Attention: [                    ]

Phone: [                    ]

Facsimile: [                    ]

Email: [                    ]

Dynegy Midwest Generation, LLC

 

  

 

  

 

  

 

  

 

  

Email:                   

Re:    Dynegy Midwest Generation, LLC – Non-U.S. Lender Certificate

Ladies and Gentlemen:

This U.S. Tax Compliance Certificate is delivered to you pursuant to
Section 2.20(e) of the Credit Agreement, dated as of August 5, 2011 (as amended,
restated, amended and restated, supplemented or otherwise modified from time to
time, the “Credit Agreement”), by and among Dynegy Midwest Generation, LLC, a
Delaware limited liability company (the “Borrower”), Dynegy Coal Investments
Holdings, LLC, a Delaware limited liability company, the Lenders party thereto
from time to time, Credit Suisse AG, Cayman Islands Branch, as administrative
agent and as collateral trustee, Credit Suisse Securities (USA) LLC and Goldman
Sachs Lending Partners LLC, as Joint Bookrunners and Joint Lead Arrangers, and
Credit Suisse Securities (USA) LLC and Goldman Sachs Lending Partners LLC, as
Joint Syndication Agents and Co-Documentation Agents. Unless otherwise defined
herein, capitalized terms used herein have the meanings provided in the Credit
Agreement.

 

H-0

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

Exhibit I-4

to Credit Agreement

 

[Insert name of applicable Lender] (“Non-U.S. Lender”) is providing this U.S.
Tax Compliance Certificate pursuant to Section 2.20(e) of the Credit Agreement.
Non-U.S. Lender hereby represents and warrants that:

1. Non-U.S. Lender is the sole record owner of the Loans in respect of which it
is providing this U.S. Tax Compliance Certificate and its partners/members are
the sole beneficial owners of such Loans. Neither Non-U.S. Lender nor any of its
partners/members is a “bank” for purposes of Section 881(c)(3)(A) of the
Internal Revenue Code of 1986, as amended (the “Code”);

2. None of the partners/members of Non-U.S. Lender is a 10-percent shareholder
of the Borrower within the meaning of Section 871(h)(3)(B) or 881(c)(3)(B) of
the Code; and

3. None of the partners/members of Non-U.S. Lender is a controlled foreign
corporation receiving interest from a related person within the meaning of
Section 881(c)(3)(C) of the Code.

The undersigned has furnished the Administrative Agent and the Borrower with IRS
Form W-8IMY accompanied by one of the following forms from each of its
partners/members that is claiming the portfolio interest exemption: (i) an IRS
Form W-8BEN or (ii) an IRS Form W-8IMY accompanied by an IRS Form W-8BEN from
each of such partner’s/member’s beneficial owners that is claiming the portfolio
interest exemption. By executing this certificate, the undersigned agrees that
(1) if the information provided on this certificate changes, the undersigned
shall promptly so inform the Borrower and the Administrative Agent, and (2) the
undersigned shall have at all times furnished the Borrower and the
Administrative Agent with a properly completed and currently effective
certificate in either the calendar year in which each payment is to be made to
the undersigned, or in either of the two calendar years preceding such payments.

Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

IN WITNESS WHEREOF, the undersigned has duly executed this U.S. Tax Compliance
Certificate as of the date first written above.

 

[INSERT NAME OF NON-U.S. LENDER]

By:                                                                    

Name:

Title:

 

I-4-1

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

Exhibit J

to Credit Agreement

 

 

PLEDGE AGREEMENT

dated as of

August 5, 2011

among

DYNEGY COAL INVESTMENTS HOLDINGS, LLC,

as Pledgor

and

CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH,

as Collateral Trustee

 

 

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

Exhibit J

to Credit Agreement

 

TABLE OF CONTENTS

 

     Page   ARTICLE I.    Definitions   

SECTION 1.01. Intercreditor Agreement and Credit Agreement

     4   

SECTION 1.02. Other Defined Terms

     4    ARTICLE II.    Pledge of LLC Interests   

SECTION 2.01. Pledge

     5   

SECTION 2.02. Delivery of the Pledged Collateral

     5   

SECTION 2.03. Representations, Warranties and Covenants

     6   

SECTION 2.04. Registration in Nominee Name; Denominations

     7   

SECTION 2.05. Voting Rights; Dividends and Interest, Etc.

     8    ARTICLE III.    Remedies   

SECTION 3.01. Remedies Upon Default

     10   

SECTION 3.02. Application of Proceeds

     11   

SECTION 3.03. Securities Act, Etc.

     11    ARTICLE IV.    Reinstatement; Waiver of Suretyship   

SECTION 4.01.

     12   

SECTION 4.02.

     13   

SECTION 4.03.

     13    ARTICLE V.    Miscellaneous   

SECTION 5.01. Notices

     13   

SECTION 5.02. Security Interest Absolute

     13   

SECTION 5.03. Survival of Agreement

     13   

SECTION 5.04. Binding Effect; Several Agreement

     14   

SECTION 5.05. Successors and Assigns

     14   

SECTION 5.06. Collateral Trustee’s Fees and Expenses; Indemnification

     14   

SECTION 5.07. Collateral Trustee Appointed Attorney-in-Fact

     16   

 

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

Exhibit J

to Credit Agreement

 

SECTION 5.08. Applicable Law

     16   

SECTION 5.09. Waivers; Amendment

     17   

SECTION 5.10. WAIVER OF JURY TRIAL

     17   

SECTION 5.11. Severability

     17   

SECTION 5.12. Counterparts

     18   

SECTION 5.13. Headings

     18   

SECTION 5.14. Jurisdiction; Consent to Service of Process

     18   

SECTION 5.15. Termination or Release

     19   

SECTION 5.16. Intercreditor Agreement Controls

     19   

Schedule I – Pledged Membership Interests

  

 

2

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

Exhibit J

to Credit Agreement

 

This PLEDGE AGREEMENT is dated as of August 5, 2011 (this “Agreement”), among
DYNEGY COAL INVESTMENTS HOLDINGS, LLC, a Delaware limited liability company
(“Pledgor”), as the grantor and CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH (“Credit
Suisse”), as collateral trustee (in such capacity, the “Collateral Trustee”).

PRELIMINARY STATEMENT

Reference is made to (i) the Credit Agreement dated as of August 5, 2011 (as
amended, amended and restated, replaced, supplemented or otherwise modified from
time to time, the “Credit Agreement”), among Dynegy Midwest Generation, LLC, a
Delaware limited liability company (the “Borrower”), Pledgor, the lenders from
time to time party thereto (the “Lenders”) and Credit Suisse, as administrative
agent (in such capacity, the “Administrative Agent”) and the Collateral Trustee,
which sets forth the terms and conditions under which the Lenders (such term and
each other capitalized term used but not defined in this preliminary statement
having the meaning given or ascribed to it in Article I) have agreed to extend
credit to the Borrower and (ii) the Collateral Trust and Intercreditor Agreement
dated as of August 5, 2011 (as amended, amended and restated, supplemented or
otherwise modified from time to time, the “Intercreditor Agreement”), among the
Borrower, the Administrative Agent, Pledgor, the Subsidiaries of the Borrower
from time to time party thereto and certain other Persons from time to time
party thereto, which, among other things, appoints the Collateral Trustee as
collateral agent thereunder, and sets forth the interests, rights, powers and
remedies of the Secured Parties in respect of the Collateral.

The obligations of the Lenders to extend credit to the Borrower under the Credit
Agreement are conditioned upon, among other things, the execution and delivery
of this Agreement by Pledgor to the Collateral Trustee for the ratable benefit
of the Secured Parties. The Borrower or any Subsidiary Guarantor may from time
to time enter into Secured Commodity Hedges, Secured Interest Rate Hedges,
Secured Treasury Services Agreements or one or more Secured Credit Facilities in
accordance with, and subject to the terms and conditions of, the Intercreditor
Agreement to the extent permitted (if addressed therein, or, otherwise, not
prohibited) under the terms of the applicable Financing Documents, in each case
that may be secured on a first priority basis by the Pledged Collateral pursuant
to the terms of this Agreement and the other Security Documents for the ratable
benefit of the Secured Parties.

On the date hereof, Pledgor is the record and beneficial owner of 100% of the
limited liability company membership interests of the Borrower as further
described in Schedule I (the “Initial Pledged LLC Interests”), will derive
substantial benefits from the extension of credit to the Borrower pursuant to
the Credit Agreement and the other extensions of credit and accommodations of
the Secured Parties under the Financing Documents and is willing to execute and
deliver this Agreement in order to induce the Lenders to extend such credit.
Accordingly, the parties hereto agree as follows:

ARTICLE I.

Definitions

 

3

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

Exhibit J

to Credit Agreement

 

SECTION 1.01. Intercreditor Agreement and Credit Agreement. (a) Capitalized
terms used in this Agreement and not otherwise defined herein have the meanings
set forth in the Intercreditor Agreement, or, if not defined therein, in the
Credit Agreement as originally in effect on the date hereof. All capitalized
terms defined in the New York UCC (as such term is defined herein) and not
defined in this Agreement have the meanings specified therein. Except as
expressly set forth in Section 2.03(i), Section 5.08 or otherwise required by
applicable law, all references to the Uniform Commercial Code shall mean the New
York UCC.

(b) The rules of construction specified in the Intercreditor Agreement also
apply to this Agreement as if incorporated herein mutatis mutandis.

SECTION 1.02. Other Defined Terms. As used in this Agreement, the following
terms have the meanings specified below:

“Administrative Agent” shall have the meaning assigned to such term in the
preliminary statement to this Agreement.

“Borrower” shall have the meaning assigned to such term in the preliminary
statement to this Agreement.

“Collateral Trustee” shall have the meaning assigned to such term in the
preliminary statement to this Agreement.

“Discharge of Obligations” shall have the meaning assigned to such term in the
Intercreditor Agreement.

“Federal Securities Laws” shall have the meaning assigned to such term in
Section 3.03.

“Financing Documents” shall have the meaning assigned to such term in the
Intercreditor Agreement.

“Initial Pledged LLC Interests” shall have the meaning assigned to such term in
the preliminary statement to this Agreement.

“Intercreditor Agreement” shall have the meaning assigned to such term in the
preliminary statement to this Agreement.

“Limited Liability Company Operating Agreement” shall mean the limited liability
operating company agreement of the Borrower dated August 5, 2011.

“New York UCC” shall mean the Uniform Commercial Code as from time to time in
effect in the State of New York.

“Obligations” shall have the meaning assigned to such term in the Intercreditor
Agreement.

 

4

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

Exhibit J

to Credit Agreement

 

“Pledged Collateral” shall have the meaning assigned to such term in
Section 2.01.

“Pledged LLC Interests” means collectively, at any time, the Initial Pledged LLC
Interests and any additional limited liability company membership interests in
the Borrower.

“Pledgor” shall have the meaning assigned to such term in the preliminary
statement to this Agreement.

“Secured Parties” shall have the meaning assigned to such term in the
Intercreditor Agreement.

“Security Interest” shall mean the security interest in respect of the Pledged
Collateral created or purported to be created by this Agreement.

ARTICLE II.

Pledged LLC Interests

SECTION 2.01. Pledge. As security for the payment or performance, as the case
may be, in full of the Obligations, Pledgor hereby assigns and pledges to the
Collateral Trustee, its successors and assigns, for the ratable benefit of the
Secured Parties, and hereby grants to the Collateral Trustee, its successors and
assigns, for the ratable benefit of the Secured Parties, a security interest in
and a continuing Lien on, all of Pledgor’s right, title and interest in, to and
under (a) the Pledged LLC Interests and the certificates representing the
Pledged LLC Interests, if any, any securities entitlements relating thereto and
all dividends, cash, instruments and other property from time to time received,
receivable or otherwise distributed in respect of or in exchange for any or all
of the Pledged LLC Interests, (b) all options, rights or other agreements
relating to the Pledged LLC Interests or the Borrower, (c) all management and
other rights of Pledgor under the Limited Liability Company Operating Agreement,
(d) all rights of Pledgor under any shareholder or voting trust agreement or
similar agreement, and (e) all Proceeds of any of the foregoing (the items
referred to in clauses (a) through (e) above being collectively referred to as
the “Pledged Collateral”).

TO HAVE AND TO HOLD the Pledged Collateral, together with all right, title,
interest, powers, privileges and preferences pertaining or incidental thereto,
unto the Collateral Trustee, its successors and assigns, for the ratable benefit
of the Secured Parties, forever; subject, however, to the terms, covenants and
conditions hereinafter set forth.

SECTION 2.02. Delivery of the Pledged Collateral. (a) Pledgor agrees promptly to
deliver or cause to be delivered to the Collateral Trustee any and all
certificates, instruments or other documents representing or evidencing Pledged
Collateral.

 

5

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

Exhibit J

to Credit Agreement

 

(b) Upon delivery to the Collateral Trustee, (i) any certificate, instrument or
document representing or evidencing Pledged Collateral shall be accompanied by
undated transfer powers duly executed in blank or other undated instruments of
transfer reasonably satisfactory to the Collateral Trustee and duly executed in
blank and by such other instruments and documents as the Collateral Trustee may
reasonably request and (ii) all other property comprising part of the Pledged
Collateral shall be accompanied by proper instruments of assignment duly
executed by Pledgor and such other instruments or documents as the Collateral
Trustee may reasonably request.

SECTION 2.03. Representations, Warranties and Covenants. To induce the Secured
Parties to enter into the applicable Financing Documents and to make their
respective extensions of credit to the applicable Loan Parties thereunder,
Pledgor represents and warrants to, and solely with respect to
Section 2.03(c)(iii), 2.03(c)(iv), Section 2.03(d), Section 2.03(e)(ii),
Section 2.03(g) and Section 2.03(j) covenants with, the Collateral Trustee, for
the benefit of the Secured Parties, that:

(a) Schedule I hereto sets forth the percentage of the Initial Pledged LLC
Interests owned by the Pledgor and the certificates, if any, representing such
Pledged LLC Interests;

(b)(i) as of the Closing Date, the Pledgor is (and at the time of delivery of
the Pledged LLC Interests to the Collateral Trustee will be) the sole holder of
record and the sole beneficial owner of the Pledged LLC Interests and (ii) the
Pledged LLC Interests have been duly and validly authorized and issued by the
Borrower and are fully paid and nonassessable;

(c) except for the security interests granted hereunder (or otherwise permitted
under the Credit Agreement and permitted (if addressed therein or, otherwise,
not prohibited) by the other applicable Financing Documents), Pledgor (i) is
and, subject to any transfers made in compliance with the Credit Agreement and
the other applicable Financing Documents, will continue to be the direct owner,
beneficially and of record, of the Pledged Collateral, (ii) holds the same free
and clear of all Liens, (iii) will make no assignment, pledge, hypothecation or
transfer of, or create or permit to exist any security interest in or other Lien
on, the Pledged Collateral, other than in compliance with the Credit Agreement
and the other applicable Financing Documents, and (iv) subject to Section 2.05,
will cause any and all Pledged Collateral, whether for value paid by Pledgor or
otherwise, to be forthwith deposited with the Collateral Trustee and pledged or
assigned hereunder;

(d) except for restrictions and limitations imposed by the Financing Documents
or securities laws generally and as do not violate the requirements of the
applicable Financing Documents, the Pledged Collateral is and will continue to
be freely transferable and assignable, and none of the Pledged Collateral is or
will be subject to any option, right of first refusal, shareholders agreement,
charter or by-law provisions or contractual restriction of any nature that might
prohibit, impair, delay or otherwise affect

 

6

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the pledge of such Pledged Collateral hereunder, the sale or disposition thereof
pursuant hereto or the exercise by the Collateral Trustee of rights and remedies
hereunder;

(e) Pledgor (i) has the power and authority to pledge the Pledged Collateral
pledged by it hereunder in the manner hereby done or contemplated and (ii) will
defend its title or interest thereto or therein against any and all Liens (other
than any Lien created or permitted by the Financing Documents), however arising,
of all persons whomsoever;

(f) no consent or approval of any Governmental Authority, any securities
exchange or any other person was or is necessary to the validity of the pledge
effected hereby (other than such as have been obtained and are in full force and
effect);

(g) by virtue of the execution and delivery by Pledgor of this Agreement, when
any Pledged Collateral is delivered to the Collateral Trustee in accordance with
this Agreement, the Collateral Trustee will obtain a legal, valid and perfected
first priority lien upon and security interest in such Pledged Collateral as
security for the payment and performance of the Obligations;

(h) the pledge effected hereby is effective to vest in the Collateral Trustee,
for the ratable benefit of the Secured Parties, the rights of the Collateral
Trustee in the Pledged Collateral as set forth herein and all action by Pledgor
necessary or desirable to protect and perfect the Lien on the Pledged Collateral
has been duly taken;

(i) the Pledged LLC Interests held by the Pledgor are represented by a
certificate and are “Securities” within the meaning of, and are governed by,
Article 8 of the Uniform Commercial Code of the State of Delaware and any other
applicable jurisdiction;

(j) Pledgor agrees, at its own expense, promptly to execute, acknowledge,
deliver and cause to be duly filed all such further instruments and documents
and take all such actions as the Collateral Agent may from time to time
reasonably request to better assure, obtain, preserve, protect and perfect the
Security Interest and the rights and remedies created hereby, including the
payment of any fees and Taxes required in connection with the execution and
delivery of this Agreement, the granting of the Security Interest and the filing
of any financing or continuation statements or other documents in connection
herewith or therewith; and

(k) will at all times hold 100% of the Equity Interests (including 100% of the
limited liability company membership interests) in the Borrower.

SECTION 2.04. Registration in Nominee Name; Denominations. The Collateral
Trustee, on behalf of the Secured Parties, shall have the right (in its sole and
absolute discretion) to hold the Pledged Collateral in its own name as pledgee,
the name of its nominee (as pledgee or as sub-agent) or the name of the Pledgor,
endorsed or assigned in blank or in favor of the Collateral Trustee. Pledgor
will promptly give to the Collateral Trustee copies of any notices or other
communications received by it with respect to Pledged LLC Interests in its
capacity as the registered owner thereof. After the occurrence and

 

7

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Exhibit J

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during the continuance of an Event of Default, the Collateral Trustee shall at
all times have the right to exchange the certificates representing Pledged LLC
Interests for certificates of smaller or larger denominations for any purpose
consistent with this Agreement.

SECTION 2.05. Voting Rights; Dividends and Interest, Etc. (a) Unless and until
an Event of Default shall have occurred and be continuing and the Collateral
Trustee shall have given Pledgor notice of its intent to exercise its rights
under this Agreement (which notice shall be deemed to have been given
immediately upon the occurrence of an Insolvency or Liquidation Proceeding which
gives rise to an Event of Default):

(i) Pledgor shall be entitled to exercise any and all voting and/or other
consensual rights and powers inuring to an owner of Pledged LLC Interests or any
part thereof for any purpose consistent with the terms of this Agreement, the
Credit Agreement and the other Financing Documents; provided, however, that such
rights and powers shall not be exercised in any manner that could materially and
adversely affect the rights inuring to a holder of any Pledged LLC Interests or
the rights and remedies of any of the Collateral Trustee or the other Secured
Parties under this Agreement, the Credit Agreement or any other Financing
Document or the ability of the Secured Parties to exercise the same;

(ii) The Collateral Trustee shall execute and deliver to Pledgor, or cause to be
executed and delivered to Pledgor, all such proxies, powers of attorney and
other instruments as Pledgor may reasonably request for the purpose of enabling
Pledgor to exercise the voting and/or consensual rights and powers it is
entitled to exercise pursuant to paragraph (i) above; and

(iii) Pledgor shall be entitled to receive and retain any and all dividends,
interest, principal and other distributions paid on or distributed in respect of
the Pledged LLC Interests to the extent and only to the extent that such
dividends, interest, principal and other distributions are permitted by, and
otherwise paid or distributed in accordance with, the terms and conditions of
the Credit Agreement, the other Financing Documents and applicable law;
provided, however, that any noncash dividends, interest, principal or other
distributions that would constitute Pledged LLC Interests, whether resulting
from a subdivision, combination or reclassification of the outstanding
membership interests of the Borrower or received in exchange for Pledged LLC
Interests or any part thereof, or in redemption thereof, or as a result of any
merger, consolidation, acquisition or other exchange of assets to which such
issuer may be a party or otherwise, shall be and become part of the Pledged
Collateral, and, if received by Pledgor, shall not be commingled by Pledgor with
any of its other funds or property but shall be held separate and apart
therefrom, shall be held in trust for the ratable benefit of the Secured Parties
and shall be forthwith delivered to the Collateral Trustee in the same form as
so received (with any necessary endorsement or instrument of assignment).

 

8

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Exhibit J

to Credit Agreement

 

(b) Upon the occurrence and during the continuance of an Event of Default, after
the Collateral Trustee shall have notified (or shall be deemed to have notified
pursuant to Section 2.05(a)) Pledgor of the suspension of their rights under
paragraph (a)(iii) of this Section 2.05, then all rights of Pledgor to
dividends, interest, principal or other distributions that Pledgor is authorized
to receive pursuant to paragraph (a)(iii) of this Section 2.05 shall cease, and
all such rights shall thereupon become vested in the Collateral Trustee, which
shall have the sole and exclusive right and authority to receive and retain such
dividends, interest, principal or other distributions. All dividends, interest,
principal or other distributions received by Pledgor contrary to the provisions
of this Section 2.05 shall be held in trust for the benefit of the Collateral
Trustee, shall be segregated from other property or funds of Pledgor and shall
be forthwith delivered to the Collateral Trustee upon demand in the same form as
so received (with any necessary endorsement or instrument of assignment). Any
and all money and other property paid over to or received by the Collateral
Trustee pursuant to the provisions of this paragraph (b) shall be retained by
the Collateral Trustee in an account to be established by the Collateral Trustee
upon receipt of such money or other property and shall be applied in accordance
with the provisions of Section 3.02. After all Events of Default have been cured
or waived and Pledgor has delivered to the Administrative Agent certificates to
that effect, the Collateral Trustee shall, promptly after all such Events of
Default have been cured or waived, repay to Pledgor (without interest) all
dividends, interest, principal or other distributions that Pledgor would
otherwise be permitted to retain pursuant to the terms of paragraph (a)(iii) of
this Section 2.05 and that remain in such account.

(c) Upon the occurrence and during the continuance of an Event of Default, after
the Collateral Trustee shall have notified (or shall be deemed to have notified
pursuant to Section 2.05(a)) Pledgor of the suspension of their rights under
paragraph (a)(i) of this Section 2.05, then all rights of Pledgor to exercise
the voting and consensual rights and powers it is entitled to exercise pursuant
to paragraph (a)(i) of this Section 2.05, and the obligations of the Collateral
Trustee under paragraph (a)(ii) of this Section 2.05, shall cease, and all such
rights shall thereupon become vested in the Collateral Trustee, which shall have
the sole and exclusive right and authority to exercise such voting and
consensual rights and powers; provided that, unless otherwise directed by the
Required Secured Parties, the Collateral Trustee shall have the right from time
to time following and during the continuance of an Event of Default to permit
Pledgor to exercise such rights.

(d) Any notice given by the Collateral Trustee to Pledgor exercising its rights
under paragraph (a) of this Section 2.05(i) must be given in writing and
(ii) may suspend the rights of Pledgor under paragraph (a)(i) or paragraph
(a)(iii) in part without suspending all such rights (as specified by the
Collateral Trustee in its sole and absolute discretion) and without waiving or
otherwise affecting the Collateral Trustee’s rights to give additional notices
from time to time suspending other rights so long as an Event of Default has
occurred and is continuing.

ARTICLE III.

Remedies

 

9

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Exhibit J

to Credit Agreement

 

SECTION 3.01. Remedies Upon Default. Upon the occurrence and during the
continuance of an Event of Default, Pledgor agrees to deliver each item of
Pledged Collateral to the Collateral Trustee on demand, and it is agreed that
the Collateral Trustee shall have the right to take any of or all the following
actions at the same or different times: with or without legal process and with
or without prior notice or demand for performance, to take possession of the
Pledged Collateral and without liability for trespass to enter any premises
where the Pledged Collateral may be located for the purpose of taking possession
of or removing the Pledged Collateral and, generally, to exercise any and all
rights afforded to a secured party under the Uniform Commercial Code or other
applicable law. Without limiting the generality of the foregoing, Pledgor agrees
that the Collateral Trustee shall have the right, subject to the mandatory
requirements of applicable law, to sell or otherwise dispose of all or any part
of the Collateral at a public or private sale or at any broker’s board or on any
securities exchange, for cash, upon credit or for future delivery as the
Collateral Trustee shall deem appropriate. The Collateral Trustee shall be
authorized at any such sale (if it deems it advisable to do so) to restrict the
prospective bidders or purchasers to persons who will represent and agree that
they are purchasing the Pledged Collateral for their own account for investment
and not with a view to the distribution or sale thereof, and upon consummation
of any such sale the Collateral Trustee shall have the right to assign, transfer
and deliver to the purchaser or purchasers thereof the Pledged Collateral so
sold. Each such purchaser at any such sale shall hold the property sold
absolutely, free from any claim or right on the part of Pledgor, and Pledgor
hereby waives (to the extent permitted by law) all rights of redemption, stay
and appraisal which Pledgor now has or may at any time in the future have under
any rule of law or statute now existing or hereafter enacted.

The Collateral Trustee shall give Pledgor 10 days’ prior written notice (which
Pledgor agrees is reasonable notice within the meaning of Section 9-611 of the
New York UCC or its equivalent in other jurisdictions) of the Collateral
Trustee’s intention to make any sale of Pledged Collateral. Such notice, in the
case of a public sale, shall state the time and place for such sale and, in the
case of a sale at a broker’s board or on a securities exchange, shall state the
board or exchange at which such sale is to be made and the day on which the
Pledged Collateral, or portion thereof, will first be offered for sale at such
board or exchange. Any such public sale shall be held at such time or times
within ordinary business hours and at such place or places as the Collateral
Trustee may fix and state in the notice (if any) of such sale. At any such sale,
the Pledged Collateral, or portion thereof, to be sold may be sold in one lot as
an entirety or in separate parcels, as the Collateral Trustee may reasonably
determine. The Collateral Trustee shall not be obligated to make any sale of any
Pledged Collateral if it shall determine not to do so, regardless of the fact
that notice of sale of such Pledged Collateral shall have been given. The
Collateral Trustee may, without notice or publication, adjourn any public or
private sale or cause the same to be adjourned from time to time by announcement
at the time and place fixed for sale, and such sale may, without further notice,
be made at the time and place to which the same was so adjourned. In case any
sale of all or any part of the Pledged Collateral is made on credit or for
future delivery, the Pledged Collateral so sold may be retained by the
Collateral Trustee until the sale price is paid by the purchaser or purchasers
thereof, but the Collateral Trustee shall not incur any liability in case any
such purchaser or purchasers shall fail to take up and pay for the Pledged
Collateral so sold and, in case of any such failure, such Pledged Collateral may
be sold again upon like notice. At any public (or, to the extent permitted by
law, private) sale made pursuant to this Agreement, any Secured Party may bid
for or purchase, free (to the extent permitted by applicable law) from any right
of redemption, stay, valuation or

 

10

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Exhibit J

to Credit Agreement

 

appraisal on the part of Pledgor (all said rights being also hereby waived and
released to the extent permitted by applicable law), the Pledged Collateral or
any part thereof offered for sale and may make payment on account thereof by
using any claim then due and payable to such Secured Party from Pledgor as a
credit against the purchase price, and such Secured Party may, upon compliance
with the terms of sale, hold, retain and dispose of such property to the fullest
extent permitted by applicable law. As an alternative to exercising the power of
sale herein conferred upon it, the Collateral Trustee may proceed by a suit or
suits at law or in equity to foreclose this Agreement and to sell the Pledged
Collateral or any portion thereof pursuant to a judgment or decree of a court or
courts having competent jurisdiction or pursuant to a proceeding by a
court-appointed receiver. Any sale pursuant to the provisions of this
Section 3.01 shall be deemed to conform to the commercially reasonable standards
as provided in Section 9-610(b) of the New York UCC or its equivalent in other
jurisdictions.

SECTION 3.02. Application of Proceeds. The Collateral Trustee shall apply the
proceeds of any collection, sale, foreclosure or other realization upon any
Pledged Collateral, including any Pledged Collateral consisting of cash, in
accordance with Section 4 of the Intercreditor Agreement.

SECTION 3.03. Securities Act, Etc. In view of the position of Pledgor in
relation to the Pledged Collateral, or because of other current or future
circumstances, a question may arise under the U.S. Securities Act of 1933, as
now or hereafter in effect, or any similar statute hereafter enacted analogous
in purpose or effect (such Act and any such similar statute as from time to time
in effect being called the “Federal Securities Laws”) with respect to any
disposition of the Pledged Collateral permitted hereunder. Pledgor understands
that compliance with the Federal Securities Laws might very strictly limit the
course of conduct of the Collateral Trustee if the Collateral Trustee were to
attempt to dispose of all or any part of the Pledged Collateral, and might also
limit the extent to which or the manner in which any subsequent transferee of
any Pledged Collateral could dispose of the same. Similarly, there may be other
legal restrictions or limitations affecting the Collateral Trustee in any
attempt to dispose of all or part of the Pledged Collateral under applicable
“blue sky” or other state securities laws or similar laws analogous in purpose
or effect. Pledgor recognizes that in light of such restrictions and limitations
the Collateral Trustee may, with respect to any sale of the Pledged Collateral,
limit the purchasers to those who will agree, among other things, to acquire
such Pledged Collateral for their own account, for investment, and not with a
view to the distribution or resale thereof. Pledgor acknowledges and agrees that
in light of such restrictions and limitations, the Collateral Trustee, in its
reasonable discretion (a) may proceed to make such a sale whether or not a
registration statement for the purpose of registering such Pledged Collateral or
part thereof shall have been filed under the Federal Securities Laws and (b) may
approach and negotiate with a limited number of potential purchasers (including
a single potential purchaser) to effect such sale. Pledgor acknowledges and
agrees that any such sale might result in prices and other terms less favorable
to the seller than if such sale were a public sale without such restrictions. In
the event of any such sale, the Collateral Trustee shall incur no responsibility
or liability for selling all or any part of the Pledged Collateral at a price
that the Collateral Trustee may in good faith deem reasonable under the
circumstances, notwithstanding the possibility that a substantially higher price
might have

 

11

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Exhibit J

to Credit Agreement

 

been realized if the sale were deferred until after registration as aforesaid or
if more than a limited number of purchasers (or a single purchaser) were
approached. The provisions of this Section 3.03 will apply notwithstanding the
existence of a public or private market upon which the quotations or sales
prices may exceed substantially the price at which the Collateral Trustee sells.

ARTICLE IV.

Reinstatement; Waiver of Suretyship

SECTION 4.01. No Limitations, Etc. (a) Except for termination of the Pledgor’s
obligations hereunder as expressly provided in Section 5.15, the obligations of
the Pledgor hereunder shall not be subject to any reduction, limitation,
impairment or termination for any reason, including any claim of waiver,
release, surrender, alteration or compromise, and shall not be subject to any
defense or setoff, counterclaim, recoupment or termination whatsoever by reason
of the invalidity, illegality or unenforceability of the Obligations or
otherwise. Without limiting the generality of the foregoing, the obligations of
the Pledgor hereunder shall not be discharged or impaired or otherwise affected
by (i) the failure of the Collateral Trustee or any other Secured Party to
assert any claim or demand or to enforce any right or remedy under the
provisions of any Financing Document or otherwise, (ii) any rescission, waiver,
amendment or modification of, or any release from any of the terms or provisions
of, any Financing Document or any other agreement, including with respect to the
Pledgor under this Agreement, (iii) the release of, or any impairment of or
failure to perfect any Lien on or security interest in, any security held by the
Collateral Trustee or any other Secured Party for the Obligations or any of
them, (iv) any default, failure or delay, wilful or otherwise, in the
performance of the Obligations, or (v) any other act or omission that may or
might in any manner or to any extent vary the risk of the Pledgor or otherwise
operate as a discharge of the Pledgor as a matter of law or equity (other than
the Discharge of Obligations in accordance with the Intercreditor Agreement).
The Pledgor expressly authorizes the Collateral Trustee to take and hold
security for the payment and performance of the Obligations, to exchange, waive
or release any or all such security (with or without consideration), to enforce
or apply such security and direct the order and manner of any sale thereof in
its sole discretion or to release or substitute any one or more other guarantors
or obligors upon or in respect of the Obligations in accordance with the terms
of the Credit Agreement and the other Financing Documents, all without affecting
the obligations of the Pledgor hereunder.

(b) To the fullest extent permitted by applicable law, the Pledgor waives any
defense based on or arising out of any defense of the Borrower or any other Loan
Party or the unenforceability of the Obligations or any part thereof from any
cause, or the cessation from any cause of the liability of the Borrower or any
other Loan Party, other than the Discharge of Obligations in accordance with the
Intercreditor Agreement. The Collateral Trustee and the other Secured Parties
may, at their election, foreclose on any security held by one or more of them by
one or more judicial or nonjudicial sales, accept an assignment of any such
security in lieu of foreclosure, compromise or adjust any part of the
Obligations, make any other accommodation with the Borrower or any other Loan
Party or exercise any other right or remedy available to them against the
Borrower or any other Loan Party, without affecting or impairing in any way the
liability of the Pledgor hereunder except to the extent of a Discharge of
Obligations

 

12

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Exhibit J

to Credit Agreement

 

in accordance with the Intercreditor Agreement. To the fullest extent permitted
by applicable law, the Pledgor waives any defense arising out of any such
election even though such election operates, pursuant to applicable law, to
impair or to extinguish any right of reimbursement or subrogation or other right
or remedy of the Pledgor against the Borrower or any other Loan Party, as the
case may be, or any security.

SECTION 4.02. Reinstatement. The Pledgor agrees its obligations and the Security
Interest hereunder shall continue to be effective or be reinstated, as the case
may be, if at any time payment, or any part thereof, of any Obligation is
rescinded or must otherwise be restored by the Collateral Trustee or any other
Secured Party upon the bankruptcy or reorganization of the Borrower, any other
Loan Party or otherwise.

SECTION 4.03. Subordination; Subrogation. Upon payment by the Pledgor of any
sums to the Collateral Trustee under this Agreement, all rights against the
Borrower or any other Person arising as a result thereof by way of right of
subrogation, contribution, reimbursement, indemnity or otherwise shall in all
respects shall be fully subordinated and subrogated to the Discharge of
Obligations in accordance with the Intercreditor Agreement.

ARTICLE V.

Miscellaneous

SECTION 5.01. Notices. All communications and notices hereunder shall (except as
otherwise expressly permitted herein) be in writing and given as provided in
Section 9.7 of the Intercreditor Agreement.

SECTION 5.02. Security Interest Absolute. All rights of the Collateral Trustee
hereunder, the Security Interest, the grant of a security interest in the
Pledged Collateral and all obligations of Pledgor hereunder shall be absolute
and unconditional irrespective of (a) any lack of validity or enforceability of
the Credit Agreement, any other Financing Document, any agreement with respect
to any of the Obligations or any other agreement or instrument relating to any
of the foregoing, (b) any change in the time, manner or place of payment of, or
in any other term of, all or any of the Obligations, or any other amendment or
waiver of or any consent to any departure from the Credit Agreement, any other
Financing Document or any other agreement or instrument relating to the
foregoing, (c) any exchange, release or non-perfection of any Lien on Collateral
or any other collateral, or any release or amendment or waiver of or consent
under or departure from any guarantee, securing or guaranteeing all or any of
the Obligations, or (d) any other circumstance that might otherwise constitute a
defense available to, or a discharge of, Pledgor in respect of the Obligations
or this Agreement.

SECTION 5.03. Survival of Agreement. All covenants, agreements, representations
and warranties made by the Loan Parties in the Financing Documents and in the
certificates or other instruments prepared or

 

13

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Exhibit J

to Credit Agreement

 

delivered in connection with or pursuant to this Agreement or any other
Financing Document shall be considered to have been relied upon by the other
Secured Parties and shall survive the execution and delivery of the Financing
Documents and the making of any loans, extensions of credit, hedging
arrangements or other financial accommodations, regardless of any investigation
made by any other Secured Parties on its behalf and notwithstanding that the
Collateral Trustee or any other Secured Parties may have had notice or knowledge
of any Default under any Financing Document, Event of Default or incorrect
representation or warranty at the time any loans, extensions of credit, hedging
arrangements or financial accommodations are extended under any Financing
Document, and shall continue in full force and effect as long as any Obligations
are outstanding and unpaid.

SECTION 5.04. Binding Effect; Several Agreement. This Agreement shall become
effective as to Pledgor when a counterpart hereof executed on behalf of Pledgor
shall have been delivered to the Collateral Trustee and a counterpart hereof
shall have been executed on behalf of the Collateral Trustee, and thereafter
shall be binding upon Pledgor and the Collateral Trustee and their respective
permitted successors and assigns, and shall inure to the benefit of Pledgor, the
Collateral Trustee and the other Secured Parties and their respective successors
and assigns, except that Pledgor shall not have the right to assign or transfer
its rights or obligations hereunder or any interest herein or in the Collateral
(and any such assignment or transfer shall be void) except as expressly
contemplated or permitted by this Agreement, the Credit Agreement and permitted
(if addressed therein or, otherwise, not prohibited) by the other applicable
Financing Documents.

SECTION 5.05. Successors and Assigns. Whenever in this Agreement any of the
parties hereto is referred to, such reference shall be deemed to include the
permitted successors and assigns of such party; and all covenants, promises and
agreements by or on behalf of Pledgor or the Collateral Trustee that are
contained in this Agreement shall bind and inure to the benefit of their
respective successors and assigns.

SECTION 5.06. Collateral Trustee’s Fees and Expenses; Indemnification. (a) The
Pledgor agrees to pay or reimburse (as applicable) the Collateral Trustee for
all its reasonable and documented out-of-pocket expenses (including the
reasonable fees, charges and disbursements of counsel for the Collateral Trustee
and of a single local counsel in each relevant jurisdiction) incurred in
collecting against the Pledgor under this Agreement or otherwise enforcing or
protecting any rights of the Collateral Trustee under this Agreement including
all reasonable and documented out-of-pocket expenses incurred during any
workout, restructuring or negotiations in respect of the Obligations.

(b) Without limitation of its indemnification obligations under the other
Financing Documents, the Pledgor jointly and severally agrees to indemnify the
Collateral Trustee and its respective Related Parties (each such Person being
called an “Indemnitee”) against, and hold each Indemnitee harmless from any and
all losses, claims, damages, liabilities and related expenses (including the
reasonable fees, charges and disbursements of counsel for the

 

14

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Exhibit J

to Credit Agreement

 

Collateral Trustee and of a single local counsel in each relevant jurisdiction),
and shall indemnify and hold harmless each Indemnitee from all fees and time
charges and disbursements, incurred by any Indemnitee or asserted against any
Indemnitee by any Person (including the Borrower or any other Loan Party)
arising out of, or in connection with, or as a result of (i) the execution or
delivery of this Agreement or any agreement or instrument contemplated hereby,
the performance by the parties hereto of their respective obligations hereunder
or the consummation of the transactions contemplated hereby or (ii) any actual
or prospective claim, litigation, investigation or proceeding relating to any of
the foregoing, whether based on contract, tort or any other theory, whether
brought by a third party or by the Pledgor, and regardless of whether any
Indemnitee is a party thereto; provided that such indemnity shall not, as to any
Indemnitee, be available to the extent that such losses, claims, damages,
liabilities or reasonable expenses (x) are determined by a court of competent
jurisdiction by final and non-appealable judgment to have resulted from the
gross negligence, bad faith or willful misconduct of such Indemnitee or (y) are
owed with respect to disputes between and among Indemnitees (other than disputes
against any Indemnitee in its capacity as Collateral Trustee or any other Agent
or Secured Debt Representative). To the extent permitted by applicable law, no
party hereto shall assert, and each party hereto hereby waives any claim against
the Pledgor or Indemnitee, on any theory of liability, for special, indirect,
consequential or punitive damages (as opposed to direct or actual damages)
arising out of, in connection with, or as a result of, this Agreement or any
agreement or instrument contemplated hereby, the Transaction, any Loan or use of
proceeds; provided that such waiver shall not include or affect in any way the
obligations of the Pledgor to indemnify the Indemnitees as set forth in this
Section 5.06.

If for any reason the foregoing indemnification is unavailable to an Indemnitee
or insufficient to hold it harmless, then Pledgor will contribute to the amount
paid or payable by such Indemnitee as a result of such loss, claim, damage or
liability in such proportion as is appropriate to reflect the relative economic
interests of (i) Pledgor and its Subsidiaries, Affiliates, shareholders,
partners, members or other equity holders on the one hand and (ii) the
Indemnitee on the other hand in the matters contemplated by the indemnities set
forth in the preceding paragraph as well as the relative fault of (x) Pledgor
and its Subsidiaries, Affiliates, shareholders, partners, members or other
equity holders on the one hand and (y) the Indemnitee with respect to such loss,
claim, damage or liability and any other relevant equitable considerations. The
indemnity and contribution obligations of Pledgor under this paragraph will be
in addition to any liability which Pledgor may otherwise have and will be
binding upon and inure to the benefit of any successors and assigns of Pledgor,
the Indemnitees, any such Subsidiaries and any such Affiliates.

(c) Any such amounts payable as provided hereunder shall be additional
Obligations secured hereby and by the other Security Documents. The provisions
of this Section 5.06 shall remain operative and in full force and effect
regardless of the termination of this Agreement or any other Financing Document,
the consummation of the transactions contemplated hereby, the repayment of any
of the Obligations or the invalidity or unenforceability of any term or
provision of this Agreement or any other Financing Document. All amounts due
under this Section 5.06 shall be payable on written demand therefor and shall
bear interest, on and from the date of demand, at the rate specified in the
Credit Agreement.

 

15

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Exhibit J

to Credit Agreement

 

SECTION 5.07. Collateral Trustee Appointed Attorney-in-Fact. Pledgor hereby
appoints the Collateral Trustee as the attorney-in-fact of Pledgor for the
purpose of carrying out the provisions of this Agreement and taking any action
and executing any instrument that the Collateral Trustee may deem reasonably
necessary or advisable to accomplish the purposes hereof, which appointment is
irrevocable and coupled with an interest (provided that in no such event shall
such appointment extend beyond the termination of this Agreement). Without
limiting the generality of the foregoing, the Collateral Trustee shall have the
right, upon the occurrence and during the continuance of an Event of Default,
with full power of substitution either in the Collateral Trustee’s name or in
the name of Pledgor (a) to receive, endorse, assign and/or deliver any and all
notes, acceptances, checks, drafts, money orders or other evidences of payment
relating to the Pledged Collateral or any part thereof, (b) to demand, collect,
receive payment of, give receipt for and give discharges and releases of all or
any of the Pledged Collateral, (c) to sign the name of Pledgor on any invoice or
bill of lading relating to any of the Pledged Collateral, (d) to commence and
prosecute any and all suits, actions or proceedings at law or in equity in any
court of competent jurisdiction to collect or otherwise realize on all or any of
the Pledged Collateral or to enforce any rights in respect of any Pledged
Collateral, (e) to settle, compromise, compound, adjust or defend any actions,
suits or proceedings relating to all or any of the Pledged Collateral, (f) to
notify, or to require Pledgor to notify, Account Debtors to make payment
directly to the Collateral Trustee, and (g) to use, sell, assign, transfer,
pledge, make any agreement with respect to or otherwise deal with all or any of
the Pledged Collateral, and to do all other acts and things necessary to carry
out the purposes of this Agreement in accordance with its terms, as fully and
completely as though the Collateral Trustee were the absolute owner of the
Pledged Collateral for all purposes; provided, however, that nothing herein
contained shall be construed as requiring or obligating the Collateral Trustee
to make any commitment or to make any inquiry as to the nature or sufficiency of
any payment received by the Collateral Trustee, or to present or file any claim
or notice, or to take any action with respect to the Pledged Collateral or any
part thereof or the moneys due or to become due in respect thereof or any
property covered thereby. The Collateral Trustee and the other Secured Parties
shall be accountable only for amounts actually received as a result of the
exercise of the powers granted to them herein, and neither they nor their
officers, directors, employees or agents shall be responsible to Pledgor for any
act or failure to act hereunder, except for their own gross negligence, willful
misconduct or bad faith.

SECTION 5.08. Applicable Law. THIS AGREEMENT AND THE OTHER FINANCING DOCUMENTS
AND ANY CLAIMS, CONTROVERSY, DISPUTE OR CAUSE OF ACTION (WHETHER IN CONTRACT OR
TORT OR OTHERWISE) BASED UPON, ARISING OUT OF OR RELATING TO THIS AGREEMENT OR
ANY OTHER FINANCING DOCUMENT (EXCEPT, AS TO ANY OTHER FINANCING DOCUMENT, AS
EXPRESSLY SET FORTH THEREIN) AND THE TRANSACTIONS CONTEMPLATED HEREBY AND
THEREBY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE
STATE OF NEW YORK (OTHER THAN MANDATORY PROVISIONS OF THE UNIFORM COMMERCIAL
CODE RELATING TO THE LAW GOVERNING PERFECTION AND THE EFFECT OF PERFECTION OF A
SECURITY INTEREST).

 

16

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

Exhibit J

to Credit Agreement

 

SECTION 5.09. Waivers; Amendment. (a) No failure or delay by the Collateral
Trustee, the Administrative Agent or any other Secured Party in exercising any
right or power hereunder or under any other Financing Document shall operate as
a waiver hereof or thereof, nor shall any single or partial exercise of any such
right or power, or any abandonment or discontinuance of steps to enforce such a
right or power, preclude any other or further exercise thereof or the exercise
of any other right or power. The rights and remedies of the Collateral Trustee
and the other Secured Parties hereunder and under the other Financing Documents
are cumulative and are not exclusive of any rights or remedies that they would
otherwise have. No waiver of any provision of any Financing Document or consent
to any departure by Pledgor therefrom shall in any event be effective unless the
same shall be permitted by paragraph (b) of this Section 5.09, and then such
waiver or consent shall be effective only in the specific instance and for the
purpose for which given. Without limiting the generality of the foregoing, the
making of loans, extensions of credit, hedging arrangements or financial
accommodations shall not be construed as a waiver of any Default under any
Financing Document or Event of Default, regardless of whether the Collateral
Trustee or any other Secured Party may have had notice or knowledge of such
Default under any Financing Document or Event of Default at the time. No notice
or demand on Pledgor in any case shall entitle Pledgor to any other or further
notice or demand in similar or other circumstances.

(b) Neither this Agreement nor any provision hereof may be waived, amended or
modified except pursuant to an agreement or agreements in writing entered into
by the Collateral Trustee and Pledgor with respect to which such waiver,
amendment or modification is to apply, subject to any consent required in
accordance with Section 5.2 of the Intercreditor Agreement.

SECTION 5.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY OTHER FINANCING DOCUMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER
THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE
BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER FINANCING DOCUMENTS BY,
AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 5.10.

SECTION 5.11. Severability. In the event any one or more of the provisions
contained in this Agreement or in any other Financing Document should be held
invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein and therein shall
not in any way be affected or impaired thereby (it being understood that the
invalidity of a

 

17

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

Exhibit J

to Credit Agreement

 

particular provision in a particular jurisdiction shall not in and of itself
affect the validity of such provision in any other jurisdiction). The parties
shall endeavor in good-faith negotiations to replace the invalid, illegal or
unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the invalid, illegal or unenforceable
provisions.

SECTION 5.12. Counterparts. This Agreement may be executed in counterparts (and
by different parties hereto on different counterparts), each of which shall
constitute an original but all of which when taken together shall constitute a
single contract, and shall become effective as provided in Section 5.04.
Delivery of an executed signature page to this Agreement by facsimile
transmission or pdf shall be as effective as delivery of a manually signed
counterpart of this Agreement.

SECTION 5.13. Headings. Article and Section headings and the Table of Contents
used herein are for convenience of reference only, are not part of this
Agreement and are not to affect the construction of, or to be taken into
consideration in interpreting, this Agreement.

SECTION 5.14. Jurisdiction; Consent to Service of Process. (a) Pledgor hereby
irrevocably and unconditionally agrees that it will not commence any suit,
action, litigation or proceeding of any kind or description, whether in law or
equity, whether in contract or in tort or otherwise, against any of the Secured
Parties or any Related Party of the foregoing in any way relating to this
Agreement or any other Financing Document or the transactions relating hereto or
thereto, in any forum other than the courts of the State of New York sitting in
New York County, and of the United States District Court of the Southern
District of New York, and any appellate court from any thereof, and each of the
parties hereto irrevocably and unconditionally submits to the exclusive
jurisdiction of such courts and agrees that all claims in respect of any such
action, litigation or proceeding may be heard and determined in such New York
State court or, to the fullest extent permitted by applicable law, in such
federal court. Each of the parties hereto agrees that a final judgment in any
such action, litigation or proceeding shall be conclusive and may be enforced in
other jurisdictions by suit on the judgment or in any other manner provided by
law. Nothing in this Agreement or in any other Financing Document shall affect
any right that the Administrative Agent, the Collateral Trustee or any other
Secured Party may otherwise have to bring any action or proceeding relating to
this Agreement or any other Financing Document against Pledgor or its properties
in the courts of any jurisdiction.

(b) Pledgor irrevocably and unconditionally waives, to the fullest extent
permitted by applicable law, any objection that it may now or hereafter have to
the laying of venue of any action or proceeding arising out of or relating to
this Agreement or any other Financing Document in any court referred to in
paragraph (a) of this Section 5.14. Each of the parties hereto hereby
irrevocably waives, to the fullest extent permitted by applicable law, the
defense of an inconvenient forum to the maintenance of such action or proceeding
in any such court.

 

18

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

Exhibit J

to Credit Agreement

 

(c) Pledgor hereby irrevocably consents to service of process in the manner
provided for notices in Section 5.01. Nothing in this Agreement or any other
Financing Document will affect the right of the Collateral Trustee to serve
process in any other manner permitted by law.

SECTION 5.15. Termination or Release. (a) This Agreement, the Security Interest
and all other security interests granted hereby shall not terminate until the
receipt of notice by the Collateral Trustee of the Discharge of Obligations in
accordance with the Intercreditor Agreement.

(b) The Pledged Collateral will be released in accordance with Section 5.1 of
the Intercreditor Agreement.

(c) In connection with any termination or release pursuant to paragraph (a) or
(b) above, the Collateral Trustee shall promptly execute and deliver to Pledgor,
at Pledgor’s expense, all Uniform Commercial Code termination statements and
similar documents that the Pledgor shall reasonably request to evidence such
termination or release. Any execution and delivery of documents pursuant to this
Section 5.15 shall be without recourse to or representation or warranty by the
Collateral Trustee or any Secured Party. Without limiting the provisions of
Section 5.06, the Borrower shall reimburse the Collateral Trustee upon demand
for all costs and out of pocket expenses, including the fees, charges and
expenses of counsel, incurred by it in connection with any action contemplated
by this Section 5.15.

SECTION 5.16. Intercreditor Agreement Controls. Notwithstanding anything herein
to the contrary, (a) the Lien and security interests granted pursuant to this
Agreement and the exercise of any right or remedy hereunder are subject to the
terms of the Intercreditor Agreement and (b) in the event of any conflict
between the terms hereof and the terms of the Intercreditor Agreement, the
Intercreditor Agreement shall govern and control; provided that, for the
avoidance of doubt, any provisions in this Agreement governing the creation and
perfection of a security interest in, or otherwise establishing the Collateral
Trustee’s or Secured Parties’ rights in, the Collateral shall govern and be of
full force and effect, notwithstanding any provision to the contrary in the
Intercreditor Agreement.

[Remainder of page intentionally left blank]

 

19

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

Exhibit J

to Credit Agreement

 

IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of
the day and year first above written.

 

DYNEGY COAL INVESTMENTS

HOLDINGS, LLC, as Pledgor

        by    

 

  Name:   Title:

[Signature page to Pledge Agreement]

 

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

Exhibit J

to Credit Agreement

 

CREDIT SUISSE AG, CAYMAN ISLANDS

BRANCH, as Collateral Trustee,

        by    

 

  Name:   Title:         by    

 

  Name:   Title:

[Signature page to Pledge Agreement]

 

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

Exhibit J

to Credit Agreement

 

SCHEDULE I

INITIAL PLEDGED LLC INTERESTS

 

Pledgor

 

Issuer

 

Type of

Organization

 

# of Shares

Owned

 

Total Shares
Outstanding

 

% of

Interest

Pledged

 

Certificate No.

(if uncertificated,
please indicate so)

Dynegy Coal Investments Holdings, LLC

  Dynegy Midwest Generation, LLC   Limited Liability Company   N/A   N/A   100%
  1

 

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

Exhibit K

to Credit Agreement

 

FORM OF INTERCREDITOR AGREEMENT

(See Exhibit 10.7 to Dynegy’s Current Report on Form 8-K filed August 8, 2011)

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

Exhibit L

to Credit Agreement

 

SOLVENCY CERTIFICATE

of

DYNEGY MIDWEST GENERATION, LLC

This solvency certificate (this “Solvency Certificate”) is dated as of August
    , 2011, and is provided pursuant to paragraph (n) of Article IV of the
Credit Agreement, dated as of August     , 2011, among Dynegy Midwest
Generation, LLC, a Delaware limited liability company (the “Borrower”), Dynegy
Coal Investments Holdings, LLC, a Delaware limited liability company, the
lenders from time to time party thereto and Credit Suisse AG, Cayman Islands
Branch, as administrative agent (in such capacity, the “Administrative Agent”)
and collateral trustee (as amended, restated, replaced, refinanced, supplemented
or otherwise modified or waived from time to time, the “Credit Agreement;”
capitalized terms used but not otherwise defined herein shall have the
respective meanings assigned to them in the Credit Agreement). The undersigned
hereby certifies, to the best of his knowledge, as follows:

 

  1. I am the Financial Officer of the Borrower;

 

  2. for purposes of this certificate, the terms below shall have the following
definitions:

 

  a. “Contingent Liabilities” means, with respect to any Loan Party, liabilities
of such Loan Party arising from foreseeable events that might occur while such
Loan Party remains a going concern; for purposes of this definition, the amount
of any Contingent Liabilities at any time shall be computed as the amount that,
in light of all of the facts and circumstances existing at such time, can
reasonably be expected to become an actual or matured liability (irrespective of
whether such Contingent Liabilities meet the criteria for accrual under
Statement of Financial Accounting Standard No. 5);

 

  b. “Fair Valuation” means, with respect to any assets, the fair market price
of such assets that could be obtained if sold in a prudent manner within a
reasonable period of time;

 

  c. “Present Fair Salable Value” means, with respect to the assets of any Loan
Party, the amount that could be obtained if all such assets are sold with
reasonable promptness in an existing (not theoretical) market;

 

  d. “Unreasonably Small Capital” means, with respect to any Loan Party, the
inability to generate sufficient cash or obtain sufficient cash from reasonably
anticipated sources of operating funds to enable such Loan Party to continue to
operate its business as a going concern, including a reasonable cushion of cash
(or cash from reasonably anticipated sources of operating funds) to enable such
Loan Party to continue to operate its business as a going concern (as such term
is determined in accordance with GAAP) in the event of adverse changes in
macroeconomic conditions or conditions in such Loan Party’s industry that could
reasonably be expected to occur in the course of the business cycle;

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

Exhibit L

to Credit Agreement

 

  3. I acknowledge that the Administrative Agent and the Lenders are relying on
the truth and accuracy of this Solvency Certificate in connection with the
making of Term Loans under the Credit Agreement;

 

  4. I have reviewed the terms of Articles III and IV of the Credit Agreement
and the definitions and provisions contained in the Credit Agreement relating
thereto, together with each of the Reorganization Documents applicable to the
transactions contemplated by the Loan Documents, a solvency opinion dated as of
August     , 2011 for the Borrower from Duff & Phelps, LLC, such other documents
as I have deemed relevant and the contents of this Solvency Certificate, and, in
my opinion, have made, or have caused to be made under my supervision, such
examination or investigation as is necessary to enable me to express an informed
opinion as to the matters referred to herein;

 

  5. neither the Borrower nor any other Loan Party intends, in consummating the
Transactions, to delay, hinder or defraud either its present or future
creditors;

 

  6. based upon my review and examination described in paragraph 3 above, I
certify that and as of the date hereof, immediately after the consummation of
the Transactions to occur on the Closing Date and immediately following the
making of each Term Loan on the Closing Date and after giving effect to the
application of the proceeds of each such Term Loan:

 

  a. the Fair Valuation of the assets of each of the (i) Borrower individually
and (ii) Loan Parties on a consolidated basis, at a Fair Valuation, will exceed
their respective debts and liabilities, whether subordinated, Contingent
Liabilities or otherwise;

 

  b. the Present Fair Saleable Value of the property of each of the (i) Borrower
individually and (ii) Loan Parties on a consolidated basis will be greater than
the amount that will be required to pay the probable liability of their
respective debts and other liabilities, whether subordinated, Contingent
Liabilities or otherwise, as such debts and other liabilities become absolute
and matured;

 

  c. each of the (i) Borrower individually and (ii) Loan Parties on a
consolidated basis will be able to pay their respective debts and liabilities,
whether subordinated, Contingent Liabilities or otherwise, as such debts and
liabilities become absolute and matured;

 

  d. each of the (i) Borrower individually and (ii) Loan Parties on a
consolidated basis will not have Unreasonably Small Capital with which to
conduct the respective businesses in which they are engaged as such business is
now conducted and is proposed to be conducted following the Closing Date;

 

  e. each of the (i) Borrower individually and (ii) Loan Parties on a
consolidated basis has generally been paying their respective debts and
liabilities, whether subordinated, Contingent Liabilities or otherwise, as such
debts and liabilities become due; and

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

Exhibit L

to Credit Agreement

 

  f. each of the (i) Borrower individually and (ii) Loan Parties on a
consolidated basis is not “insolvent” within the meaning given that term and
similar terms under applicable Debtor Relief Laws and other applicable laws
relating to fraudulent transfers and conveyances.

(Signature page follows)

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

IN WITNESS WHEREOF, the undersigned has executed this Solvency Certificate as of
the date first stated above.

 

DYNEGY MIDWEST GENERATION, LLC

By:

      Name:   Title: Chief Financial Officer

 

L-4

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

Exhibit M

to Credit Agreement

Dynegy Coal Holdco, LLC

1000 Louisiana, Suite 5800

Houston, Texas 77002-5050

August 5, 2011

Credit Suisse AG, Cayman Islands Branch,

as Administrative Agent for the Lenders

under the Credit Agreement referred to below

and as Collateral Trustee

One Madison Avenue,

New York, NY 10010

 

  Re: LETTER OF UNDERTAKING AND SEPARATENESS

This letter agreement is provided pursuant to paragraph (u) of Article IV of the
Credit Agreement, dated as of August 5, 2011, among Dynegy Midwest Generation,
LLC, a Delaware limited liability company (the “Borrower”), Dynegy Coal
Investments Holdings, LLC, a Delaware limited liability company (“Intermediate
Holdings”), the lenders from time to time party thereto and Credit Suisse AG,
Cayman Islands Branch, as administrative agent (in such capacity, the
“Administrative Agent”) and collateral agent (as amended, restated, replaced,
refinanced, supplemented or otherwise modified or waived from time to time, the
“Credit Agreement;” capitalized terms used but not otherwise defined herein
shall have the respective meanings assigned to them in the Credit Agreement).

In order to induce the Lenders to enter into the transactions contemplated by
the Credit Agreement and the other Loan Documents, and for other good and
valuable consideration, the sufficiency and receipt of which are hereby
acknowledged, Dynegy Coal Holdco, LLC, a Delaware limited liability company
(“Holdings”), intending to be legally bound, hereby covenants with the
Administrative Agent on behalf of the Lenders and the Collateral Trustee and
undertakes to take the following measures to maintain the bankruptcy remoteness
of the Borrower, the other Loan Parties and their respective subsidiaries:

 

  1. While the Credit Agreement remains in effect, Holdings will take all
reasonable steps to maintain the identity of Intermediate Holdings and its
subsidiaries (collectively, the “Ring-Fenced Entities”) as legal entities that
are separate and distinct from Holdings and all Affiliates of Holdings other
than the Ring-Fenced Entities. Without limiting the generality of the foregoing
and in addition to the other covenants set forth herein, Holdings agrees that:

 

  a. it will at all times have at least one Independent Manager;

 

  b. it will cause Intermediate Holdings to have at all times at least one
Independent Manager;

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

  c. the annual financial statements of Holdings that it prepares, if any, and
distributes shall include a statement that makes clear in such financial
statements (in conformity with GAAP and the rules and regulations of the
Securities and Exchange Commission and acceptable to it and its independent
public accountants that audit its financial statements) that the assets of
Intermediate Holdings and its subsidiaries are not available to the creditors of
Holdings or the other Group Members (other than Intermediate Holdings and its
subsidiaries) (or, alternatively, that such assets are only available for the
creditors of Intermediate Holdings and its subsidiaries);

 

  d. Holdings will not cause any Ring-Fenced Entities to violate the
separateness criteria and restrictions set forth in such entity’s Limited
Liability Company Operating Agreement and in the Credit Agreement;

 

  e. Holdings shall maintain corporate records and books of account separate
from those of the Ring-Fenced Entities;

 

  f. the resolutions, agreements and other instruments underlying the
transaction described in Article IV of the Credit Agreement shall be
continuously maintained by Holdings as official records;

 

  g. Holdings will not hold itself out as being liable for the debts of the
Ring-Fenced Entities;

 

  h. Holdings shall keep its assets and its liabilities wholly separate from
those of each of the Ring-Fenced Entities; and

 

  i. upon the receipt of any proceeds of Insurance (as defined in the Guarantee
and Collateral Agreement) or any other insurance (whether casualty, business
interruption, liability, title or otherwise) by Holdings arising, to Holdings’
knowledge, from any event or occurrence at, of, or related to, any Ring-Fenced
Entity, Holdings shall hold such proceeds separate and apart therefrom,
segregated from other property or funds of Holdings and not commingled by
Holdings with any of its other funds or property, and hold such proceeds in
trust for the Ring-Fenced Entities, and promptly upon obtaining such knowledge
deliver such proceeds to the Ring-Fenced Entities in the same form as so
received (with any necessary endorsement or instrument of assignment).

 

2

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

THIS LETTER AGREEMENT AND ANY CLAIMS, CONTROVERSY, DISPUTE OR CAUSE OF ACTION
(WHETHER IN CONTRACT OR TORT OR OTHERWISE) BASED UPON, ARISING OUT OF OR
RELATING TO THIS LETTER AGREEMENT) AND THE TRANSACTIONS CONTEMPLATED HEREBY
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF
NEW YORK.

 

BY:

 

Name: Title: Date:

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

Exhibit N

to Credit Agreement

Dynegy Inc.

1000 Louisiana, Suite 5800

Houston, Texas 77002-5050

August 5, 2011

Credit Suisse AG, Cayman Islands Branch,

as Administrative Agent for the Lenders

under the Credit Agreement referred to below

and as Collateral Trustee

One Madison Avenue,

New York, NY 10010

 

  Re: LETTER OF UNDERTAKING AND SEPARATENESS

This letter agreement is provided pursuant to paragraph (v) of Article IV of the
Credit Agreement, dated as of August 5, 2011, among Dynegy Midwest Generation,
LLC, a Delaware limited liability company (the “Borrower”), Dynegy Coal
Investments Holdings, LLC, a Delaware limited liability company (“Intermediate
Holdings”), the lenders from time to time party thereto and Credit Suisse AG,
Cayman Islands Branch, as administrative agent (in such capacity, the
“Administrative Agent”) and collateral agent (as amended, restated, replaced,
refinanced, supplemented or otherwise modified or waived from time to time, the
“Credit Agreement;” capitalized terms used but not otherwise defined herein
shall have the respective meanings assigned to them in the Credit Agreement).

In order to induce the Lenders to enter into the transactions contemplated by
the Credit Agreement and the other Loan Documents, and for other good and
valuable consideration, the sufficiency and receipt of which are hereby
acknowledged, Dynegy Inc. (the “Parent”), intending to be legally bound, hereby
covenants with the Administrative Agent on behalf of the Lenders and the
Collateral Trustee and undertakes to take the following measures to maintain the
bankruptcy remoteness of the Borrower, the other Loan Parties and their
respective subsidiaries:

 

  2. While the Credit Agreement remains in effect, the Parent will take all
reasonable steps to maintain the identity of Intermediate Holdings and its
subsidiaries (collectively, the “Ring-Fenced Entities”) as legal entities that
are separate and distinct from the Parent and all Affiliates of the Parent other
than the Ring-Fenced Entities. Without limiting the generality of the foregoing
and in addition to the other covenants set forth herein, the Parent agrees that:

 

  a.

the annual financial statements of the Parent that it prepares and distributes
shall include a statement that makes clear in its financial statements (in
conformity with GAAP and the rules and regulations of the Securities and
Exchange Commission and acceptable to it and its independent public accountants
that audit its financial statements) that the assets of Intermediate Holdings
and its subsidiaries are not available to the creditors of Parent or the

 

4

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

Exhibit N

to Credit Agreement

 

  other Group Members (other than Intermediate Holdings and its subsidiaries)
(or, alternatively, that such assets are only available for the creditors of
Intermediate Holdings and its subsidiaries);

 

  b. the Parent will not cause any Ring-Fenced Entities to violate the
separateness criteria and restrictions set forth in such entity’s Limited
Liability Company Operating Agreement and in the Credit Agreement;

 

  c. the Parent shall maintain corporate records and books of account separate
from those of the Ring-Fenced Entities;

 

  d. the resolutions, agreements and other instruments underlying the
transaction described in Article IV of the Credit Agreement shall be
continuously maintained by the Parent as official records;

 

  e. the Parent will not hold itself out as being liable for the debts of the
Ring-Fenced Entities;

 

  f. the Parent shall keep its assets and its liabilities wholly separate from
those of each of the Ring-Fenced Entities, except as permitted in the applicable
Limited Liability Company Operating Agreements or the Credit Agreement; and

 

  g. upon the receipt of any proceeds of Insurance (as defined in the Guarantee
and Collateral Agreement) or any other insurance (whether casualty, business
interruption, liability, title or otherwise) by the Parent or any Group Member
(other than the Ring-Fenced Entities) arising, to the Parent’s or such Group
Member’s knowledge, from any event or occurrence at, of, or related to, any
Ring-Fenced Entity, the Parent shall, and shall cause each other Group Member
(other than the Ring-Fenced Entities) to hold such proceeds separate and apart
therefrom, segregated from other property or funds of such Person and not
commingled by such Person with any of its other funds or property, and hold such
proceeds in trust for the Ring-Fenced Entities and promptly upon obtaining such
knowledge deliver such proceeds to the Ring-Fenced Entities in the same form as
so received (with any necessary endorsement or instrument of assignment).

 

5

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

THIS LETTER AGREEMENT AND ANY CLAIMS, CONTROVERSY, DISPUTE OR CAUSE OF ACTION
(WHETHER IN CONTRACT OR TORT OR OTHERWISE) BASED UPON, ARISING OUT OF OR
RELATING TO THIS LETTER AGREEMENT) AND THE TRANSACTIONS CONTEMPLATED HEREBY
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF
NEW YORK.

 

BY:

 

Name: Title: Date:

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

Exhibit O

to Credit Agreement

CERTIFICATE

of

DYNEGY POWER MARKETING, LLC (the “Company”)

This certificate (this “Certificate”) is dated as of August 5, 2011, and is
provided pursuant to clause (w) of Article IV of the Credit Agreement, dated as
of August 5, 2011, among Dynegy Midwest Generation, LLC, a Delaware limited
liability company (the “Borrower”), Dynegy Coal Investments Holdings, LLC, a
Delaware limited liability company, the lenders from time to time party thereto
and Credit Suisse AG, Cayman Islands Branch, as administrative agent (in such
capacity, the “Administrative Agent”) and collateral trustee (as amended,
restated, replaced, refinanced, supplemented or otherwise modified or waived
from time to time, the “Credit Agreement;” capitalized terms used but not
otherwise defined herein shall have the respective meanings assigned to them in
the Credit Agreement). The undersigned hereby certifies, to the best of his
knowledge, as follows:

 

  1. I am the Financial Officer of the Company;

 

  2. I certify that and as of the date hereof, immediately after the
consummation of the Transactions to occur on the Closing Date:

 

  a. the Company’s liabilities to unaffiliated third parties are in an aggregate
amount that does not materially exceed the sum of (x) the aggregate amount owed
to the Company by GasCo and its subsidiaries or the Borrower and its
Subsidiaries under back-to-back arrangements with respect to such third-party
obligations and (y) the amount of letters of credit and cash posted to secure
performance of the Company’s obligations under its agreements with third
parties;

 

  b. each letter of credit issued under the Existing Credit Facility as credit
support for the obligations of the Company and its subsidiaries has been
replaced with a letter of credit issued under letter of credit facilities of
GasCo or the Borrower; and

 

  c. each of the Company and its material subsidiaries has sufficient liquidity
to pay its debts as such debts come due in the ordinary course of its business.

(Signature page follows)

 

7

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

Exhibit O

to Credit Agreement

IN WITNESS WHEREOF, the undersigned has executed this Certificate as of the date
first stated above.

 

DYNEGY POWER MARKETING, LLC By:  

 

  Name: Clint Freeland   Title: Chief Financial Officer

 

8

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

Exhibit P

to Credit Agreement

CERTIFICATE OF AUTHORIZED OFFICER

This certificate (this “Certificate of Authorized Officer”) is dated as of
August     , 2011, and is provided in support of the opinion of White & Case LLP
dated August     , 2011 (the “Opinion”) as to whether, in a case under title 11
of the United States Code, 11 U.S.C. §101 et seq. (the “Bankruptcy Code”) in
which any of the Non-Ringfenced Entities (defined below) was a debtor, a
bankruptcy court would substantively consolidate the assets and liabilities of
one or more of the Ringfenced Entities (defined below) with the assets and
liabilities of one or more Non-Ringfenced Entities, whether or not the
Ringfenced Entities are also debtors under the Bankruptcy Code. Capitalized
terms used but not otherwise defined herein shall have the respective meanings
assigned to them in the Opinion.

The undersigned hereby certifies, to the best of his knowledge, as follows:

1. I am and since July 5, 2011 have been the duly qualified and acting Executive
Vice President and Chief Financial Officer of Dynegy Inc. and will be appointed
the Executive Vice President and Chief Financial Officer of Dynegy Midwest
Generation, LLC (“DMG” or “CoalCo”, or the “Company”) and in such capacity have
responsibility for the management of the financial affairs of the Company.

2. I have personal knowledge of the matters set forth in this Certificate, or I
have inquired of others with personal knowledge of the matters set forth herein.

 

  A. Parties

3. Dynegy Inc. (“DI”) is a holding company that conducts substantially all of
its business operations through subsidiaries. Through certain of its
subsidiaries, DI sells electric energy, capacity and ancillary services on a
wholesale basis from power generation facilities.

4. Dynegy Holdings Inc. (“DHI”) is a holding company that conducts substantially
all of its business operations through subsidiaries.

5. Dynegy Administrative Services Company (“DAS”) manages the cash systems for
DI and its subsidiaries (the entities listed on Schedule 1 to the Opinion, and
together with DI, the “Dynegy Entities”).

6. Dynegy Operating Company (“DOC”) manages the operations and employs certain
of the employees of the Dynegy Entities.

7. Dynegy Coal Investments Holdings, LLC (“DCIH”) and its direct subsidiary DMG
(together with DCIH, and any existing or future subsidiaries of DCIH or DMG, the
“Ringfenced Entities”) engage primarily in the business of generating electric
power from primarily coal–fired baseload power generation facilities located
across the Midwest region of the United States. Except for two plants which are
leased by Dynegy Danskammer, LLC and Dynegy Roseton, LLC, the Non-Ringfenced
Entities do not engage in such business in any material

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respect and do not directly own any assets capable of permitting them to engage
in such business.

8. The Ringfenced Entities will own and/or operate the following power
generation facilities and their power capacity: Baldwin (1,800 MW), Havana (441
MW), Hennepin (293 MW), Oglesby (63 MW), Stallings (89 MW), Wood River (446 MW)
and Vermilion (176 MW) (owned, but not operated).

9. All Dynegy Entities that are not Ringfenced Entities are the “Non-Ringfenced
Entities.”

 

  B. Description of the Transaction

10. DI is undergoing a reorganization and restructuring (the “Reorganization”)
to facilitate, among other things, the CoalCo Credit Facility, align its asset
base and maximize its flexibility to address additional potential debt
restructuring activities.

11. As part of the Reorganization, DHI and its subsidiaries effected
transactions to cause, inter alia, (x) substantially all of DI’s coal-fired
power generation facilities to continue to be held by DMG, (y) substantially all
of DI’s gas-fired power generation facilities to be held by Dynegy Power, LLC
(“DP”) and (z) 100% of the ownership interests of Dynegy Northeast Generation,
Inc. (“DNE”), the entity that indirectly holds the equity interests in the
subsidiaries that operate the Roseton and Danskammer power generation
facilities, to be held directly by DHI.

 

  C. Corporate Formalities and Separateness

12. Prior to the date hereof, and since being formed as or acquired by Dynegy
Entities, the Non-Ringfenced Entities and the Ringfenced Entities have conducted
all statutorily required shareholder, member and board meetings, have maintained
minutes thereof and have otherwise complied in all material respects with the
governance formalities required by their articles of incorporation or other
organizational documents, bylaws, limited liability company operating agreements
and applicable law. Without limiting the generality of the foregoing, all
transactions involving any Non-Ringfenced Entity or Ringfenced Entity that
require board approval under its articles of incorporation, bylaws, limited
liability company operating agreements or other organizational documents or
applicable law are submitted to the board of directors, or equivalent, of such
entity for approval.

13. Except as otherwise set forth herein, since being formed as or acquired by
Dynegy Entities, all Dynegy Entities have maintained proper books and records,
allocating assets and liabilities to specific entities, and currently segregate,
and have segregated, their material assets so that they are readily identifiable
as assets of a specific Dynegy Entity.

14. All Ringfenced Entities are, as of the date hereof, adequately capitalized
to conduct their respective businesses and have sufficient employees or service
providers to conduct their respective businesses.

 

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15. The Non-Ringfenced Entities and the Ringfenced Entities have separately
appointed officers, directors and/or managers. Certain individuals serve as
officers of both Non-Ringfenced Entities and Ringfenced Entities. Any such
individuals act solely on behalf of or for the benefit of the specific entity
when acting in their capacity as an officer, director or manager of such entity.

16. In the past, it has not been the Dynegy Entities’ practice for the
management of the Ringfenced Entities to determine, before a Ringfenced Entity
has taken any action or engaged in transactions with a Non-Ringfenced Entity,
that such actions, or transactions, were in such Ringfenced Entity’s best
interests. Typically, officers, managers and directors acted in the interest of
the enterprise as a whole.

17. All distributions made by any Ringfenced Entity to a Non-Ringfenced Entity
have been made and paid, and will continue to be made and paid in accordance
with such Ringfenced Entity’s organizational documents and applicable law. No
undocumented dividend payments or distributions have been or will be made by a
Ringfenced Entity to a Non-Ringfenced Entity. In the ordinary course of
business, certain distributions made by Ringfenced Entities to Non-Ringfenced
Entities giving rise to intercompany obligations have been documented by book
entries, and all other dividend payments and/or distributions made by Ringfenced
Entities to Non–Ringfenced Entities have been properly declared and documented
in all material respects.

18. Many Dynegy entities have “doing business as” names (“DBAs”). Some are
registered DBAs; some are not. Many are the old names of the entities prior to
being merged into another entity.

19. For a period of time in the past, at least one of the plants that Dynegy
acquired used letterhead that identified such plant as “a division of Dynegy
Inc.” Additionally, personnel at some of the power plants have Dynegy business
cards and refer to themselves as “Dynegy” employees, and employees of the
various Ringfenced Entities have sometimes represented themselves as
representing Dynegy Inc.

20. The Ringfenced Entities and Non-Ringfenced Entities are participating
employers under a number of employee benefit plans in common, including (but not
limited to) pension plans.

 

  D. Transactions with Third Parties

 

  i. Credit Facilities

21. The Non-Ringfenced Entities and the Ringfenced Entities will finance their
business activities through separate credit facilities. Previously, certain of
the Ringfenced Entities provided guarantees and pledged assets to support a
first lien credit facility of DHI, which facility will be repaid. Following the
Reorganization, all of the obligations owed to the lenders under the DHI first
lien credit facility are being simultaneously repaid and the facility is being
terminated. There will be no upstream or downstream guarantees between
Ringfenced Entities and the Non-Ringfenced Entities with respect to any credit
facilities. Following the Reorganization, there will be no Non-Ringfenced Entity
that guarantees any indebtedness or

 

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other obligations of a Ringfenced Entity and no Ringfenced Entity will guarantee
any indebtedness or other obligations of a Non-Ringfenced Entity.

22. In order to obtain credit on a stand-alone basis, the Non-Ringfenced
Entities and the Ringfenced Entities maintain, and will maintain separate credit
ratings as well as separate financial books and records sufficient both in their
nature and scope to enable third parties to assess the creditworthiness of
Non-Ringfenced Entities and the Ringfenced Entities as stand alone entities.

23. DHI will include a note to its financial statements stating that the assets
of DCIH and its subsidiaries will not be available to DHI’s creditors, and DHI
will separately contract not to hold itself out as liable for the obligations of
the Ringfenced Entities.

 

  ii. Relationships with Vendors and Customers

24. In order to procure the best terms of purchase for all Dynegy Entities,
Non-Ringfenced Entities have in the past purchased, and may in the future
purchase, goods and services on behalf of Dynegy Entities, including the
Ringfenced Entities, and Ringfenced Entities have in the past purchased, and may
in the future purchase, goods and services on behalf of Dynegy Entities,
including the Non-Ringfenced Entities. Each such purchase is referred to herein
as a “Joint Purchase.” An example of a Joint Purchase includes insurance, which
is not segregated between Ringfenced Entities and Non-Ringfenced Entities. Going
forward, the cost of insurance will be allocated among the Ringfenced Entities
and Non-Ringfenced Entities on an arm’s length basis, and any proceeds of
insurance will be paid to, or for the benefit of, the owner of the insured
property – notwithstanding the identity of another entity as a loss payee.

25. Historically, the Joint Purchases have been made through a procurement
process. Going forward, the Joint Purchases will predominantly be made through
the Dynegy Entities’ centralized procurement process, resulting in certain
master contracts for goods and services received by the Ringfenced Entities
being entered into in the name of DAS.

26. Actual purchase orders for the purchase of specific goods and services which
use the master contracts as terms and conditions are usually entered into in the
name of the Dynegy Entity receiving the goods or services. Failure to contract
in the name of the receiving Dynegy Entity is infrequent.

27. In the past, not all of the cost of the transaction has been directly
charged to the beneficiary of such Joint Purchase, and, in many cases,
intercompany accounts were maintained for Joint Purchases with no intention of
payment. The Dynegy Entities have, from time to time, and may, in connection
with the Reorganization, forgive certain intercompany payables. Many, but not
all, of those intercompany payables relate to Joint Purchases.

28. In the future, in the event that a Ringfenced Entity or a Non-Ringfenced
Entity makes a Joint Purchase, such Ringfenced Entity or Non-Ringfenced Entity
will charge (through invoice or other record) the Non-Ringfenced Entity or the
Ringfenced Entity, as the case may be, for such Joint Purchase and the
Non-Ringfenced Entity will reimburse the Ringfenced Entity or the Ringfenced
Entity will reimburse the Non-Ringfenced Entity in the ordinary course of
business.

 

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29. Each Ringfenced Entity will bill its customers on invoices clearly
referencing solely such Ringfenced Entity. Other than in the limited context of
services to be provided under a Service Agreement between DI and DCIH, when
transacting business with third parties, including vendors and customers,
employees of the Ringfenced Entities will not hold themselves out as agents or
representatives of Non-Ringfenced Entities.

30. In the past, when dealing with vendors and customers, employees of some of
the Ringfenced Entities were publicly identified as employees of the
Non-Ringfenced Entities. On and after the Reorganization, however, other than in
the limited context of Services, when transacting business with third parties,
employees of Non-Ringfenced Entities will not hold themselves out as agents or
representatives of Ringfenced Entities.

31. Dynegy Marketing and Trade, LLC (“DMT”) has in the past sold emissions
credits to third-parties but did not own such credits. The emissions credits are
owned at the facility level by the Ringfenced Entities. In the future, any such
sales will be done with the consent of the Ringfenced Entities, and all proceeds
of the emissions credits will be properly delivered to those Ringfenced Entities
selling them.

 

  F. Intercompany Transactions

 

  i. The Tax Sharing Agreement

32. Under the United States federal income tax law, DI is responsible for the
tax liabilities of Dynegy Coal Holdco, LLC, DCIH, Dynegy GasCo Holdings, LLC,
Dynegy Gas Holdco, LLC, Dynegy Gas Investments Holdings, LLC, DMG, Dynegy Power
Company (the “Combined Entities”) and the other Ringfenced Entities because DI
will file consolidated income tax returns which will necessarily include the
income and business activities of the Combined Entities, the other Ringfenced
Entities and DI’s other affiliates. In order to properly allocate taxes among DI
and each of the Combined Entities and the other Ringfenced Entities, DI and each
of the Combined Entities have entered into a Tax Sharing Agreement (the “Tax
Sharing Agreement”).

 

  ii. Cash Management

33. Not every Dynegy Entity, whether or not such entity is ringfenced, maintains
its own separate cash account. Historically, cash at Dynegy has been run through
accounts at DAS, and typically, Ringfenced Entities owning power plants have had
their own bank accounts. Currently, DAS handles all cash management for the
Dynegy Entities. Payments are made by DAS and are recorded to the appropriate
entity as an intercompany balance.

 

  iii. Financial Arrangement and Other Intercompany Matters

34. In the past, there was no consistently used mechanism for charging general
and administrative (“G&A”) type costs to the entities. Some G&A expenses
incurred for the benefit of one entity were recorded on the books and records of
another entity. Numerous services including accounting, operations support, etc.
were provided on a verbal basis to the plants without charge. Corporate level
transactions and services were provided at cost. For certain employees, the
payroll entity and the entity for which direct services were performed have not

 

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been exactly allocated. Financing activities occurred at the DHI level for the
benefit of some Ringfenced Entities, and the Ringfenced Entities were not
charged interest on any intercompany advances. In the past, some Non-Ringfenced
Entities have entered into gas purchases on behalf of some of the Ringfenced
Entities.

35. Many Ringfenced Entities were guarantors of the DHI’s credit facility,
pursuant to agreements executed in the ordinary course by the Ringfenced
Entities. In addition to the guarantees, mortgages and security interests were
granted by the Ringfenced Entities in support of the DHI credit agreement. All
of those existing guarantees, mortgages and security interests will be
terminated simultaneously with the incurrence of the loans under the GasCo
Credit Facility. Through the evolution of the Dynegy Entities’ business, many
intercompany debts have been formally transferred or assumed by entities that
were not a party initially the obligor on such debt. Prior to the
Reorganization, there were numerous intercompany accounts that were substantial;
those intercompany debts consolidate to zero in the Dynegy Entities’ public
financial statements. The intercompany accounts have not been made available or
otherwise disclosed to the public. All intercompany accounts between Ringfenced
Entities and Non-Ringfenced Entities will be reduced to zero substantially
simultaneously with the incurrence of loans under the GasCo Credit Facility.

36. The Dynegy Entities’ historical energy management agreements (the
“Historical EMAs”) were likely not arm’s length agreements. The Historical EMAs
essentially allowed some of the Ringfenced Entities to conduct commodity
transactions, both financial and physical, through DMT, Dynegy Power Marketing,
LLC, and Dynegy Coal Trading & Transportation, LLC without containing specific
fee provisions.

(Signature page follows)

 

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IN WITNESS WHEREOF, the undersigned has executed this Certificate of Authorized
Officer as of the date first stated above.

 

DYNEGY MIDWEST GENERATION, LLC

By:

 

 

  Clint C. Freeland   Executive Vice President and   Chief Financial Officer

 

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