CREDIT AGREEMENT
Dated as of June 30, 2015

among
HORSEHEAD CORPORATION,
and
THE INTERNATIONAL METALS RECLAMATION COMPANY, LLC
and
HORSEHEAD METAL PRODUCTS, LLC
as Borrowers,

THE LENDERS FROM TIME TO TIME PARTY HERETO,
as Lenders,

and
MACQUARIE BANK LIMITED,
as Administrative Agent and Sole Arranger
                                                    

     
   
  

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TABLE OF CONTENTS
Page

INTRODUCTION1
ARTICLE I DEFINITIONS AND ACCOUNTING TERMS1
Section 1.01Certain Defined Terms1
Section 1.02Computation of Time Periods28
Section 1.03Accounting Terms.28
Section 1.04Miscellaneous28
ARTICLE II THE CREDIT FACILITIES29
Section 2.01The Advances29
Section 2.02Method of Borrowing.29
Section 2.03Fees.31
Section 2.04Repayment31
Section 2.05Interest31
Section 2.06Prepayments.32
Section 2.07Increased Costs.33
Section 2.08Payments and Computations.34
Section 2.09Taxes.35
Section 2.10Sharing of Payments, Etc37
Section 2.11Applicable Lending Offices37
Section 2.12Intentionally Omitted.37
Section 2.13Mitigation Obligations; Replacement of Lenders.37
Section 2.14Termination of Commitments and Facilities.38
Section 2.15Extension of Maturity Date39
Section 2.16Defaulting Lenders.39
ARTICLE III CONDITIONS OF LENDING40
Section 3.01Initial Conditions Precedent40
Section 3.02Conditions Precedent to Each Borrowing43
Section 3.03Determinations Under Sections 3.01 and 3.0243
ARTICLE IV REPRESENTATIONS AND WARRANTIES44
Section 4.01Formation and Existence44
Section 4.02Power and Authority44
Section 4.03Authorization and Approvals44
Section 4.04Enforceable Obligations44

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Section 4.05Financial Statements; No Material Adverse Effect.45
Section 4.06True and Complete Disclosure45
Section 4.07Litigation45
Section 4.08Compliance with Laws45
Section 4.09No Default46
Section 4.10Properties and Contracts.46
Section 4.11Environmental Condition.46
Section 4.12Insurance.47
Section 4.13Taxes47
Section 4.14ERISA Compliance.48
Section 4.15Security Interests.48
Section 4.16Labor Relations49
Section 4.17Solvency49
Section 4.18Margin Regulations49
Section 4.19Investment Company50
Section 4.20OFAC Restrictions50
ARTICLE V AFFIRMATIVE COVENANTS50
Section 5.01Preservation of Existence50
Section 5.02Compliance with Laws50
Section 5.03Maintenance of Property50
Section 5.04Maintenance of Insurance.50
Section 5.05Payment of Taxes, Etc51
Section 5.06Reporting Requirements51
Section 5.07Other Notices53
Section 5.08Books and Records; Inspection54
Section 5.09Use of Proceeds54
Section 5.10Nature of Business55
Section 5.11Further Assurances in General55
Section 5.12Cash Management55
Section 5.13Risk Management Policy55
Section 5.14Collateral55
Section 5.15Compliance with Anti-Money Laundering and OFAC Laws.56

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Section 5.16Maintenance of Liens57
Section 5.17Creditors57
Section 5.18Commodity Exchange Act Keepwell Provisions.57
ARTICLE VI NEGATIVE COVENANTS57
Section 6.01Liens, Etc57
Section 6.02Debts, Guaranties and Other Obligations58
Section 6.03Merger or Consolidation59
Section 6.04Asset Sales59
Section 6.05Capital Expenditures and Investments60
Section 6.06Restricted Payments62
Section 6.07Change in Nature of Business62
Section 6.08Transactions With Affiliates62
Section 6.09Agreements Restricting Liens and Distributions62
Section 6.10Limitation on Accounting Changes or Changes in Fiscal Periods62
Section 6.11Sale and Leaseback Transactions62
Section 6.12Other Debt63
Section 6.13Legal Status; Amendment of Organizational Documents63
Section 6.14Trading Limitations63
Section 6.15Additional Subsidiaries63
Section 6.16Accounts63
Section 6.17Intentionally Omitted63
Section 6.18Information64
Section 6.19Intentionally Omitted64
Section 6.20Financial Covenants.64
Section 6.21Post-Closing Obligations64
ARTICLE VII EVENTS OF DEFAULT64
Section 7.01Events of Default64
Section 7.02Optional Acceleration of Maturity67
Section 7.03Automatic Acceleration of Maturity67
Section 7.04Non-exclusivity of Remedies67
Section 7.05Right of Set-off67

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Section 7.06Application of Proceeds68
ARTICLE VIII THE ADMINISTRATIVE AGENT69
Section 8.01Appointment and Authority69
Section 8.02Rights as a Lender69
Section 8.03Exculpatory Provisions69
Section 8.04Reliance by Administrative Agent70
Section 8.05Delegation of Duties70
Section 8.06Resignation of Administrative Agent70
Section 8.07Non-Reliance on Administrative Agent and Other Lenders71
Section 8.08Indemnification71
Section 8.09Collateral Matters.72
Section 8.10No Other Duties, Etc73
ARTICLE IX MISCELLANEOUS73
Section 9.01Amendments, Etc73
Section 9.02Notices, Etc.74
Section 9.03No Waiver; Cumulative Remedies76
Section 9.04Costs and Expenses76
Section 9.05Indemnification76
Section 9.06Joint and Several Liability78
Section 9.07Successors and Assigns.79
Section 9.08Confidentiality.81
Section 9.09Execution in Counterparts82
Section 9.10Survival of Representations, etc82
Section 9.11Severability82
Section 9.12Governing Law82
Section 9.13Submission to Jurisdiction.82
Section 9.14Waiver of Jury Trial83
Section 9.15USA PATRIOT Act Notification83
Section 9.16Notice to Debtor; Entire Agreement.83

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EXHIBITS:
Exhibit A        -    Form of Assignment and Acceptance Agreement
Exhibit B        -    Form of Borrowing Base Certificate
Exhibit C        -    Form of Borrowing Request
Exhibit D        -    Form of Compliance Certificate
Exhibit E        -    Form of Guaranty
Exhibit F        -    Form of Intercreditor Agreement - 2015
Exhibit G        -    Form of Note

SCHEDULES:
Schedule 1.01(a)    -    Applicable Index Price
Schedule 1.01(b)    -    Mortgaged Properties
Schedule 1.01(c)    -    Permitted Disclosed Liens
Schedule 1.01(d)    -    Real Property
Schedule 2.01        -    Commitments of the Lenders
Schedule 4.01        -    Equity Interests
Schedule 4.09        -    Known Defaults
Schedule 4.10(b)    -    Material Intellectual Property
Schedule 4.10(c)    -    Certain Contracts
Schedule 4.10(e)    -    Accounts
Schedule 4.11        -    Environmental Matters
Schedule 4.12        -    Insurance
Schedule 6.01(b)    -    Existing Debt
Schedule 6.05        -    Existing Investments
Schedule 9.02        -    Addresses for Notice

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CREDIT AGREEMENT
This Credit Agreement, dated as of June 30, 2015 (the “Effective Date”), is
entered into by and between HORSEHEAD CORPORATION, company organized under the
laws of the State of Delaware (“Horsehead”), and THE INTERNATIONAL METALS
RECLAMATION COMPANY, LLC, a limited liability company organized under the laws
of the State of Delaware (“INMETCO”), and HORSEHEAD METAL PRODUCTS, LLC, a
limited liability company organized under the laws of the State of North
Carolina (“HMP” and, together with Horsehead and INMETCO, each a “Borrower” and,
collectively, the “Borrowers”), and MACQUARIE BANK LIMITED, a company with
limited liability organized under the laws of Australia, as Administrative Agent
and a Lender (each term as defined below).

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INTRODUCTION
A.    The Borrowers have requested that one or more of the Lenders provide
certain loans to and extensions of credit on behalf of the Borrowers.
B.    In consideration of the mutual covenants and agreements herein contained
and of the loans, extensions of credit and commitments hereinafter referred to,
the parties hereto agree as follows:
Article I
DEFINITIONS AND ACCOUNTING TERMS
Section 1.01    Certain Defined Terms. Any capitalized terms used in this
Agreement that are not otherwise defined herein and are defined in Article 9 of
the UCC shall have the meanings assigned to those terms by the UCC as of the
date of this Agreement. As used in this Agreement, the following terms shall
have the following meanings (unless otherwise indicated, such meanings to be
equally applicable to both the singular and plural forms of the terms defined):
“Acceptable Credit Support” means (i) approved credit insurance and/or letters
of credit in form reasonably acceptable to Administrative Agent issued by a
financial institution that has an “’A’ Equivalent Rating and (ii) a guarantee,
credit default swap, credit insurance or other customary credit support, in each
case, provided by any Person who has an “’A’ Equivalent Rating or is otherwise
reasonably acceptable to Administrative Agent. For purposes herein, “Equivalent
Rating” shall mean such rating by two or more of Moody’s, S&P or other
nationally recognized rating services or the equivalent rating for such service.
“Acceptable Lien” means, with respect to any Property of any Person, any Lien on
such Property which (a) with respect to any Collateral exists in favor of the
Collateral Agent for the benefit of the Secured Parties; (b) secures the payment
and performance of the Obligations; and (c) is perfected and valid and
enforceable against the Borrower Party that created such Lien in preference to,
and has priority over, any Liens or other rights of any Person therein, except
for Permitted Liens and except as expressly provided in the Intercreditor
Agreement - 2015.
“Account Control Agreement” shall have the meaning set forth in Section
3.01(a)(viii).
“Account Debtor” means any Person who is or may become obligated with respect
to, or on account of, an Account.
“Adjusted EBITDA” means EBITDA as calculated from financial statements prepared
in accordance with GAAP, adjusted for unrealized hedge gains/losses, non-cash
compensation expenses, and one-time charges of Horsehead Holdings and its
Subsidiaries on a consolidated basis,.
“Administrative Agent” means MBL in its capacity as administrative agent for the
Lenders under the Credit Facility Documents and any successor in such capacity
appointed pursuant to Section 8.06.
“Administrative Office” means the office of the Administrative Agent at the
address specified on Schedule 9.02 or such other office, branch, subsidiary,
affiliate or correspondent bank as the Administrative Agent may from time to
time specify to the Borrower.
“Administrative Questionnaire” means an administrative questionnaire in a form
supplied by the Administrative Agent.

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“Advance” means an advance in Dollars by a Lender to any Borrower as part of a
Borrowing.
“Advance Limit” means, as of any date, the lesser of (a) the Borrowing Base on
such date and (b) the aggregate Commitments, as such amounts may be increased or
decreased in accordance with the terms and provisions of this Agreement.
“Affiliate” of any Person, means any other Person that, directly or indirectly,
through one or more intermediaries, controls, is controlled by, or is under
common control with, such Person or any Subsidiary of such Person. The term
“control” (including the terms “controlled by” or “under common control with”)
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of a Person, whether through the
ability to exercise voting power, by contract or otherwise.
“Agreement” means this Credit Agreement dated as of June 30, 2015, among the
Borrowers, the Lenders and the Administrative Agent, as it may be amended or
modified and in effect from time to time.
“Anti-Money Laundering Laws” means any laws or regulations relating to money
laundering or terrorist financing, including, without limitation, the Bank
Secrecy Act, 31 U.S.C. sections 5301 et seq.; the Uniting and Strengthening
America by Providing Appropriate Tools Required to Intercept and Obstruct
Terrorism Act of 2001, Pub. L. 107-56 (a/k/a the USA Patriot Act); Laundering of
Monetary Instruments, 18 U.S.C. Section 1956; Engaging in Monetary Transactions
in Property Derived from Specified Unlawful Activity, 18 U.S.C. Section 1957;
the Financial Recordkeeping and Reporting of Currency and Foreign Transactions
Regulations, 31 C.F.R. Part 103; and any similar laws or regulations currently
in force or hereafter enacted.
“Annual Financials” has the meaning set forth in Section 5.06(a).
“Applicable Index Price” means for any Eligible Inventory as of any day, the
applicable index price for such specific Eligible Inventory set forth on
Schedule 1.01(a) attached hereto as of the last Business Day of the week
immediately preceding such day.
“Applicable Lending Office” means (a) with respect to any Lender, the office,
branch, subsidiary, affiliate or correspondent bank of such Lender specified in
its Administrative Questionnaire or such other office, branch, subsidiary,
affiliate or correspondent bank as such Lender may from time to time specify to
the Borrowers and the Administrative Agent from time to time and (b) with
respect to the Administrative Agent, the address specified for such Person on
Schedule 9.02 or such other address or correspondent bank as shall be designated
by such party in a notice to the other parties to this Agreement.
“Applicable Margin” means with respect to the Contract Rate, 4.10 percent per
annum.
“Approval” and “Consent” mean, with respect to any consent or approval sought by
Borrowers and given by the Administrative Agent, the Collateral Agent or a
Lender, the writings executed by such Person that (a) authorize Borrowers to
take the action for which the consent or approval is sought and (b) set forth
the conditions, if any, upon which the consent or approval is given by such
Person. “Approve” and “Approved” have the correlative meanings.
“Approved Bailee Letter” means a letter or waiver from a third party holding or
carrying Inventory in which such Person acknowledges the Acceptable Lien of
Collateral Agent for the benefit of the Secured Party in such Inventory, waives
or subordinates any Lien in such Inventory and otherwise agrees to customary
secured creditor rights in such Inventory, in form and substance reasonably
acceptable to Collateral Agent.

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“Approved Fund” means any Fund that is administered or managed by (a) a Lender,
(b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that
administers or manages a Lender.
“Asset Disposition” means the disposition, whether by sale, lease, license,
transfer, loss, damage, destruction, condemnation or otherwise, of any or all of
the Property of any Borrower Party.
“Assignment and Acceptance” 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 9.06), and accepted by the Administrative Agent,
in substantially the form of Exhibit A.
“Availability” means the Advance Limit minus the sum of all Lenders' Extensions
of Credit.
“Availability Period” means the period from and including the Closing Date to
but excluding the earlier of the Maturity Date and the date of termination of
the Commitments.
“Bartlesville Facility” means Horsehead Holding’s former zinc processing
facility located in Bartlesville, Oklahoma.
“Beaumont Facility” means the Horsehead Holding’s former zinc recycling facility
located in Beaumont, Texas.
“Borrower” and “Borrowers” are each defined in the first paragraph of this
Agreement.
“Borrower Party” means each Borrower and Guarantor, and “Borrower Parties” means
all such Persons.
“Borrower Insurance Policies” has the meaning set forth in Section 3.01(a)(xv).
“Borrowers’ Agent” has the meaning set forth in Section 9.02(g).
“Borrowers Current Assets” means the current assets of the Borrowers, determined
in accordance with GAAP.
“Borrowers Current Liabilities” means the current liabilities (excluding notes
payable and current maturities of long term indebtedness) of the Borrowers,
determined in accordance with GAAP.
“Borrowers Net Working Capital” means, at any date, an amount equal to (a) the
Borrowers Current Assets, minus (b) Borrowers Current Liabilities.
“Borrowing” means a borrowing consisting of simultaneous Advances made by each
Lender pursuant to Section 2.01.
“Borrowing Base” means, without duplication, the sum of the following based on
the assets of the Borrowers, minus the Exposure minus such reserves as the
Administrative Agent may reasonably deem proper and necessary from time to time:
(a)    100% of Cash Collateral and cash maintained in a deposit account that is
subject to an Account Control Agreement pursuant to which the Collateral Agent
has an Acceptable Lien; provided that the amount included in the Borrowing Base
under this clause (a) shall not exceed $30,000,000;

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(b)    The value of Eligible Receivables multiplied by the Applicable Advance
Rate, as follows:
Form of accounts receivable
Applicable Advance Rate
Eligible Receivables payable by a Lender or its Affiliate
100%
Eligible Receivables supported by Acceptable Credit Support
90%
Eligible Receivables payable by counterparties with an Investment Grade Rating
not disapproved by the Administrative Agent
90%
All other forms of Eligible Receivables
85%

(c)    The value of Eligible Inventory based upon basis and reference,
multiplied by the Applicable Advance Rate, as follows, as adjusted by the
Administrative Agent in its discretion for appropriate market premium or
discount based upon quality of Eligible Inventory versus Applicable Index Price
referenced quality inventory:
Form of Eligible Inventory
Applicable Advance Rate
Basis
Reference
Hedged zinc-containing inventory, including Waelz oxide and calcine, but not
including WIP, powers, dross/skims, EAF or zinc dust
90%
Market
Applicable Index Price
Unhedged zinc containing inventory, including Waelz oxide and calcine, but not
including WIP, powers, dross/skims, EAF or zinc dust
70%
Market
Applicable Index Price
Lead/Silver Concentrates
60%
Market
Applicable Index Price
Hedged Nickel remelt and pigs
90%
Market
Applicable Index Price
Unhedged Nickel remelt and pigs
70%
Market
Applicable Index Price
Metallurgical Coke
60%
Cost
 

(d)    Net Fixed Asset Liquidation Value.
(e)    75% of the INMETCO Projected Gross Margin for the following six (6)
months, subject to a cap which is the lesser of (i) $9,000,000 and (ii) (A) 120%
of (B) six (6) times the actual average monthly INMETCO Gross Margin achieved by
INMETCO over the last twelve (12) month period.
An example of a calculation of the Borrowing Base is attached hereto as Exhibit
B.

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Any assets which would violate the Risk Management Policy will be excluded from
the Borrowing Base. Any change in the Borrowing Base due to a change in the
Collateral shall be effective on the effective date of such change in the
Collateral.
The value of the Borrowing Base shall be determined by reference to the most
recently dated Borrowing Base Certificate or update thereof prepared by the
Borrowers pursuant to Section 5.06(e) and (f) absent any error in such Borrowing
Base Certificate or update thereof as of the date delivered, provided, however,
that if Borrowers fail to deliver a Borrowing Base Certificate or update thereof
or supporting information as and when required pursuant to Section 5.06(e), the
Administrative Agent has the right to reduce the Borrowing Base in effect to
zero until such Borrowing Base Certificate or update or supporting information
is delivered in compliance with this Agreement. The Administrative Agent may
recalculate the Borrowing Base on any Business Day based on information with
respect to the Borrowing Base then known to the Administrative Agent. The value
of each item (a) through (e) above shall be computed in accordance with the
provisions of the respective definitions provided in this Agreement.
Notwithstanding any other provision of the Credit Facility Documents, (1) no
asset shall be included in the Borrowing Base unless the Collateral Agent has
been granted, for the benefit of the Secured Parties, an Acceptable Lien and, in
any event, the Lien evidenced thereby has been perfected under applicable law,
and (2) no asset shall be included in the Borrowing Base in duplicate categories
such that it would be counted toward the Borrowing Base more than once.
In the event that at any time the Administrative Agent reasonably determines
that the most recently delivered Borrowing Base Report overstates the amount of
any of items (a) through (e) above or understates the amount of Exposure above,
the Administrative Agent will give written notice of such determination to
Borrowers, so that Borrowers may promptly correct such overstatement.
“Borrowing Base Certificate” means a certificate, signed and certified as
accurate and complete by a Financial Officer of a Borrower, in substantially the
form of Exhibit B or another form which is acceptable to the Administrative
Agent, together with supporting information thereto.
“Borrowing Date” means the date on which any Advance is made hereunder.
“Borrowing Request” means a borrowing request in the form of the attached
Exhibit C signed by a Responsible Officer.
“Business Day” means any day other than a Saturday, Sunday or other day on which
commercial banks are authorized to close under the laws of, or are in fact
closed in, New York, New York.
“CAA” means that certain Collateral Agency and Intercreditor Agreement, dated as
of the date of this Agreement, by and among MBL, as collateral agent, the
Administrative Agent, on behalf of the Lenders and each other Secured Party from
time to time a party thereto, as amended from time to time.
“Capital Expenditures” means all expenditures in respect of the purchase or
other acquisition of any fixed or capital asset including, without limitation,
land, buildings and equipment, but excluding any such expenditure made in
connection with the replacement or restoration of fixed or capital assets to the
extent financed with insurance proceeds paid on account of the loss of or damage
to, with awards of compensation arising from the taking by condemnation or
eminent domain of, or with the proceeds of any other disposition of (to the
extent permitted under this Agreement), such fixed or capital assets.
“Capital Lease” of a Person means any lease of any Property by such Person as
lessee that would, in accordance with GAAP, be required to be classified and
accounted for as a capital lease on the balance sheet of such Person.

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“Capital Stock” of any Person means any and all shares, interests, rights to
purchase, warrants, options, participations or other equivalents of or interests
in (however designated) equity of such Person, including any preferred stock,
but excluding any debt securities convertible into such equity.
"Capitalized Lease Obligation" shall mean any obligations of any Borrower Party
under a Capital Lease that is required to be capitalized for financial reporting
purposes in accordance with GAAP.
“Cash Collateral” “ means (a) Dollars which have been deposited with the
Collateral Agent as Collateral for all Obligations, and held in the Cash
Collateral Account; and (b) Dollars which have been deposited at another
financial institution as Collateral for any Obligations, provided that such cash
collateral is subject to an Account Control Agreement pursuant to which the
Collateral Agent has an Acceptable Lien, in each case including Dollars in a
Cash Collateral Account or account controlled by Collateral Agent that arise
from prepayments of accounts.
“Cash Collateralize” means to deposit and pledge Cash Collateral as collateral
for the Obligations, it being acknowledged by the parties hereto that the pledge
contained within the Security Agreement is sufficient for the requirement to
pledge Cash Collateral hereunder.
“Cash Collateral Account” means a special cash collateral account pledged by the
applicable Borrower Party to the Collateral Agent for the ratable benefit of the
Secured Parties containing cash deposited pursuant to this Agreement.
“Cash Equivalents” means (a) securities with maturities of 180 days or less from
the date of acquisition insured or fully guaranteed or insured by the United
States Government or any agency thereof, and (b) overnight deposits in money
market accounts held in the United States with any Lender or with any commercial
bank domiciled in the United States having capital and surplus in excess of
$500,000,000.
“Change in Law” means the occurrence, after the date of this Agreement, of any
of the following: (a) the adoption of, or taking effect of, any law, rule,
regulation or treaty, (b) any change in any law, rule, regulation or treaty or
in the administration, interpretation or application thereof by any Governmental
Authority or (c) the making or issuance of any 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 rules, guidelines or directives
thereunder or issued in connection therewith and (y) all 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.
“Change of Control” means the occurrence of any of the following: (a) one
hundred percent (100%) of the Equity Interests of any Borrower is no longer
owned or controlled by Horsehead Holding, (b) one hundred percent (100%) of the
Equity Interests of any Subsidiary of a Borrower (other than Horsehead Zinc
Recycling, LLC, a South Carolina limited liability company (“Horsehead Zinc”))
is no longer owned or controlled by a Borrower, (c) ninety-nine percent (99%) of
the Equity Interests of Horsehead Zinc is no longer owned or controlled by a
Borrower, (d) any merger, consolidation or sale of substantially all of the
property or assets of any Borrower Party, or (e) with respect to Horsehead
Holding:
(a)    any Person or related group of Persons (other than such Person or an
Affiliate of such Person) directly or indirectly acquires beneficial ownership
(within the meaning of Rule 13d‑3 under the Securities Exchange Act of 1934, as
amended) of (i) securities possessing more than fifty

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percent (50%) of the total combined voting power of Horsehead Holding's
outstanding securities; or
(b)    there is a change in the composition of Horsehead Holding's Board of
Directors over a period of twelve (12) consecutive months (or less) such that a
majority of Board members (rounded up to the nearest whole number) ceases, by
reason of one or more proxy contests for the election of Board members, to be
comprised of individuals who either (i) have been Board members continuously
since the beginning of such period or (ii) have been elected or nominated for
election as Board members during such period by at least a majority of the Board
members described in clause (i) who were still in office at the time such
election or nomination was approved by the Board.
For purposes of this definition, “controlled by” shall mean the power of any
person, direct or indirect (i) to vote one hundred percent (100%) or more of the
Equity Interests having ordinary voting power for the election of directors (or
the individuals performing similar functions) of any Person or (ii) to direct or
cause the direction of the management and policies of any Person by contract or
otherwise.
“Closing Date” means July 6, 2015.
“Code” means the United States Internal Revenue Code of 1986, as amended,
reformed or otherwise modified from time to time, and any successor statute and
all rules and regulations promulgated thereunder.
“Collateral” means, collectively, all Property (other than Excluded Assets)
pledged, mortgaged, assigned, granted or otherwise subjected to a Lien under any
of the Security Documents, and any proceeds therefrom.
“Collateral Agent” means MBL in its capacity as collateral agent for the Lenders
under the CAA and any successor in such capacity appointed pursuant to the CAA.
“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et
seq.), as amended from time to time, and any successor statute or any
regulations promulgated thereunder.
“Contract Rate” means a rate per annum equal to the lesser of (a) the sum of the
Applicable Margin plus the Designated LIBOR Rate, and (b) the Highest Lawful
Rate.
“Commitment” means, as to each Lender, its obligation to (a) make Advances to
the Borrowers pursuant to Section 2.01, in an aggregate principal amount at any
one time outstanding not to exceed the amount set forth opposite such Lender's
name on Schedule 2.01 under the caption “Commitment” or in the Assignment and
Acceptance pursuant to which such Lender becomes a party hereto opposite the
caption “Commitment”, as such amount may be adjusted from time to time in
accordance with this Agreement, including pursuant to Section 2.18. The
aggregate amount of the Commitments as of the Closing Date is $80,000,000.
“Commitment Fee” has the meaning set forth in Section 2.03(a).
“Competing Guaranty” has the meaning set forth in Section 9.06(b).
“Compliance Certificate” means a Compliance Certificate signed by a Financial
Officer of the Borrowers in substantially the form of the attached Exhibit D.

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“Cost of Funds Rate” means the rate per annum quoted by the Administrative Agent
to the Borrowers at or about the commencement of any Advance as the cost of
funds for the Advance, as determined by the Administrative Agent in its sole
discretion which determination may include, without limitation, such factors as
the Administrative Agent shall deem appropriate from time to time, including
without limitation, market, regulatory and liquidity conditions; provided that
such rate is not necessarily the cost to any Lender of funding the specific
Advance, and may exceed a Lender’s actual cost of borrowing in the interbank
market or other markets in which a Lender may obtain funds from time to time for
amounts similar to the amount of the Advance.
“Credit Facility Documents” means this Agreement, any Notes issued pursuant to
Section 2.02(g), the Guaranties, the Security Documents, the Intercreditor
Agreement - 2015, the Fee Letter and each other agreement, instrument or
document executed by any Borrower Party or any of their respective officers at
any time in connection with this Agreement, all as amended, restated,
supplemented or modified from time to time.
“Credit Facility Obligations” means all advances to, and debts, liabilities,
obligations, covenants and duties of, any Borrower Party arising under any
Credit Facility Document or otherwise with respect to any Advance, whether
direct or indirect (including those acquired by assumption), absolute or
contingent, due or to become due, now existing or hereafter arising and
including interest and fees that accrue after the commencement by or against any
Borrower Party or any Affiliate thereof of any proceeding under any law relating
to bankruptcy, insolvency or reorganization or relief of debtors naming such
Person as the debtor in such proceeding, regardless of whether such interest and
fees are allowed claims in such proceeding.
“Current Assets” means the current assets of the Horsehead Holdings and its
Subsidiaries on a consolidated basis, determined in accordance with GAAP.
“Current Liabilities” means the current liabilities (excluding notes payable and
current maturities of long term indebtedness) of the Horsehead Holdings and its
Subsidiaries on a consolidated basis, determined in accordance with GAAP.
“Debt,” means, for any Person, without duplication, all of the following,
whether or not included as indebtedness or liabilities in accordance with GAAP:
(a) all obligations of such Person for borrowed money; (b) amount raised under
or liabilities in respect of any note purchase or acceptance credit facility;
(c) reimbursement obligations under any letter of credit agreement; (d)
obligations under any Hedge Agreement; (e) Capitalized Lease Obligations; (f)
any other transaction (including forward sale or purchase agreements, and
conditional sales agreements) having the commercial effect of a borrowing of
money entered into by such Person to finance its operations or capital
requirements (but not including trade payables and accrued expenses incurred in
the Ordinary Course of Business which are not represented by a promissory note
or other evidence of indebtedness and which are not more than thirty (30) days
past due), including prepayments received for the sale of Inventory or the
providing of services by a Borrower Party for which the delivery of Inventory or
the providing of services is more than two (2) months after the date of
prepayment; (g) Debt of others secured by a Lien on Property now or hereafter
owned or acquired by such Person (including indebtedness arising under
conditional sales or other title retention agreements), whether or not such Debt
shall have been assumed by such Person or is limited in recourse; and (h) all
Guarantees of such Person in respect of any of the foregoing. The amount of any
Debt under any Hedge Agreement on any date shall be deemed to be the Termination
Value thereof as of such date.
“Debtor Relief Laws” means the Bankruptcy Code of the United States or Canada,
and all other liquidation, conservatorship, bankruptcy, assignment for the
benefit of creditors, moratorium, rearrangement,

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receivership, insolvency, reorganization, or similar debtor relief Legal
Requirements of the United States or Canada or other applicable jurisdictions
from time to time in effect and affecting the rights of creditors generally.
“Default” means (a) an Event of Default or (b) any event or condition which with
notice or lapse of time or both would, unless cured or waived, become an Event
of Default.
“Defaulting Lender” means, subject to Section 2.16(b), any Lender that (a) has
failed to (i) fund all or any portion of its Advances within two Business Days
of the date such Advances were required to be funded hereunder unless such
Lender notifies the Administrative Agent and the Borrowers in writing prior to
the Borrowing Date that such failure is the result of such Lender’s
determination that one or more conditions precedent to funding (each of which
conditions precedent, together with any applicable default, shall be
specifically identified in such writing) has not been satisfied, or (ii) pay to
the Administrative Agent or any other Lender any other amount required to be
paid by it hereunder within two Business Days of the date when due, (b) has
notified the Borrowers, the Administrative Agent in writing that it does not
intend to comply with its funding obligations hereunder, or has made a public
statement to that effect (unless such writing or public statement relates to
such Lender’s obligation to fund an Advance hereunder and states that such
position is based on such Lender’s determination that a condition precedent to
funding (which condition precedent, together with any applicable default, shall
be specifically identified in such writing or public statement) cannot be
satisfied), (c) has failed, within three Business Days after written request by
the Administrative Agent or the Borrowers, to confirm in writing to the
Administrative Agent and the Borrowers that it will comply with its prospective
funding obligations hereunder (provided that such Lender shall cease to be a
Defaulting Lender pursuant to this clause (c) upon receipt of such written
confirmation by the Administrative Agent and the Borrowers), or (d) has, or has
a direct or indirect parent company that has, (i) become the subject of a
proceeding under any Debtor Relief Law, or (ii) 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 under any one or more of clauses (a)
through (d) above shall be conclusive and binding absent manifest error, and
such Lender shall be deemed to be a Defaulting Lender (subject to Section
2.16(b)) upon delivery of written notice of such determination to the Borrowers
and each Lender.
“Deposit Accounts” has the meaning set forth in Section 5.12.
“Depository Banks” has the meaning set forth in Section 5.12.
“Designated LIBOR Rate” means a rate per annum (on the basis of a year of three
hundred sixty (360) days and rounded upward, if necessary, to the nearest 1/16th
of 1%) equal to the rate obtained by dividing (i) a rate per annum quoted on the
Reuters page LIBOR03 for the purpose of displaying London interbank offered rate
administered by ICE Benchmark Administration Limited (or any other Person which
takes over the administration of that rate) in U.S. Dollars as the three month
London Interbank Offered Rate in the London interbank market at approximately
11:00 a.m. London, England time (or as soon thereafter as practicable) each day
(or if such day is not a London Business Day, as fixed in the same manner on the

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immediately preceding London Business Day, which day's rate shall, unless
otherwise provided for, apply to the immediately succeeding non-London Business
Days), as determined by the Administrative Agent from any broker, quoting
service or commonly available source utilized by the Administrative Agent, by
(ii) a percentage equal to 100% minus the stated maximum rate of all reserves
required to be maintained against “Eurocurrency Liabilities” as specified in
Regulation D (or against any other category of liabilities, which includes
deposits by reference to which the interest rate on London Interbank Offered
Rate loans is determined, or any category of extensions of credit or other
assets which includes loans by a non-United States' office of a bank to United
States' residents) on such date to any member bank of the Federal Reserve
System. Notwithstanding any provision above, the practice of rounding to
determine LIBOR may be discontinued at any time in the Administrative Agent's
sole discretion. If such rate does not appear on Reuters page LIBOR03 (or
otherwise on such successor page), the Designated LIBOR Rate for the relevant
Interest Period shall instead be the rate determined by the Administrative Agent
to be the rate at which MBL offers to place deposits in Dollars with first class
banks in the London interbank market at approximately 11:00 a.m. (London time)
two (2) Business Days prior to the first Business Day of such calendar month, in
the approximate amount of the relevant Advance and having a three month
maturity. Notwithstanding the foregoing, in the following circumstances and for
so long as such circumstances persist, the Designated LIBOR Rate shall be the
Cost of Funds Rate for all purposes of this Agreement:
(a)     if the Administrative Agent is unable to determine the London Interbank
Offered Rate for loans in a principal amount of at least U.S. $1,000,000 having
a three-month maturity in accordance with the foregoing procedures;
(b)    if the Administrative Agent determine that any Change in Law makes it
unlawful for any Lender to perform their obligations under this Agreement to
make, fund or maintain Advances that bear interest at the London Interbank
Offered Rate;
(c)    if the Administrative Agent determines that the London Interbank Offered
Rate for loans in a principal amount of at least U.S. $1,000,000 having a
three-month maturity will not adequately reflect the cost to such Lenders of
making or funding Advances at such rate; or
(d)    at the election of the Administrative Agent 3 Business Days after receipt
by Borrowers of a written notice thereof, at any time when and so long as an
Event of Default has occurred and is continuing.
“Dispose” means to transfer in an Asset Disposition.
“Disqualified Stock” means any Capital Stock of a Person or any of its
Subsidiaries that by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable, in either case at the option of the
holder thereof) or otherwise (a) matures or is mandatorily redeemable pursuant
to a sinking fund obligation or otherwise, (b) is or may become redeemable or
repurchaseable at the option of the holder thereof, in whole or in part or (c)
is convertible or exchangeable at the option of the holder thereof for Debt or
Disqualified Stock, on or prior to, in the case of clause (a), (b) or (c), 91
days after the Scheduled Maturity Date.
Notwithstanding the preceding sentence:
(1)    any Capital Stock that would constitute Disqualified Stock solely because
the holders thereof have the right to require Horsehead Holdings to repurchase
such Capital Stock upon the occurrence of a Change of Control or an asset sale
will not constitute Disqualified Stock so long as the right to have such Capital
Stock repurchased upon a Change of Control or asset sale are no more favorable
to the holders thereof than the requirements set forth;

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(2)    any Capital Stock issued to any plan for the benefit of employees of
Horsehead Holdings or its Subsidiaries or by any such plan to such employees,
such Capital Stock shall not constitute Disqualified Stock solely because it may
be required to be repurchased by Horsehead Holdings or its Subsidiaries in order
to satisfy applicable statutory or regulatory obligations; and
(3)    any Capital Stock held by any future, current or former employee,
director, manager or consultant (or their respective trusts, estates, investment
funds, investment vehicles or immediate family members) of Horsehead Holdings,
any of its Subsidiaries or any parent in each case upon the termination of
employment or death of such person pursuant to any stock option plan or any
other management or employee benefit plan or agreement shall not constitute
Disqualified Stock solely because it may be required to be repurchased by
Horsehead Holdings or its Subsidiaries.
“Dollars” and “$” means the lawful money of the United States of America.
“EBITDA” for any period means an amount equal to (a) Net Income of Horsehead
Holdings and its Subsidiaries on a consolidated basis, calculated from financial
statements prepared in accordance with GAAP plus (b) to the extent deducted in
determining Net Income, the sum of (i) Interest Expense of Horsehead Holdings
and its Subsidiaries, (ii) provision for income taxes of Horsehead Holdings and
its Subsidiaries, (iii) depreciation and amortization of Horsehead Holdings and
its Subsidiaries, and (iv) unrealized gains and losses on hedge transaction
positions, non-cash compensation expenses, one-time charges to Net Income and
all other non-cash charges, in each case of Horsehead Holdings and its
Subsidiaries.
“Eligible Assignee” means (a) a Lender or Affiliate of a Lender, (b) a fund or
funding vehicle either managed by, serviced by or associated with a Lender or a
Lender’s Affiliate, and (c) any other Person (other than a natural person)
approved by the Administrative Agent, and, as long as no Event of Default
exists, by the Borrower, in either such case such approval not to be
unreasonably withheld or delayed; provided that notwithstanding the foregoing,
“Eligible Assignee” shall not include any Borrower Party, any Borrower Party's
Affiliates or Subsidiaries or any of Borrower Party’s competitors that are
notified by the Borrowers to the Administrative Agent in writing prior to the
Closing Date (such list to be approved by the Administrative Agent in its sole
discretion).
“Eligible Inventory” means, at any time, a Borrower’s Inventory:
(a)    to which any of the Borrowers has title;
(b)    which is located in the United States or Canada; and
(c)    in which the Collateral Agent has an Acceptable Lien.
In the event that Inventory which was previously Eligible Inventory ceases to be
Eligible Inventory hereunder, the Borrowers shall notify the Administrative
Agent thereof on and at the time of submission to the Administrative Agent of
the next Borrowing Base Certificate.
“Eligible Receivable” means accounts receivable arising from the sale by the
Borrowers to customers in the Ordinary Course of Business of eligible products
on ordinary course terms and conditions that are (a) net of third party
payables, unless such payable is subject to subordination reasonably acceptable
to Administrative Agent; (b) not past due more than 30 days after the due date
of the relevant invoice; and (c) subject to an Acceptable Lien; provided that if
the amount of Eligible Receivables payable by one counterparty and its
Affiliates exceed 30% of the total amounts of Eligible Receivables, then only
the amount of such Eligible Receivable up to such 30% of total shall be counted
in the Borrowing Base.

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“Environmental Event” means the existence of an Environmental Liability of any
Borrower Party that could reasonably be expected to have a Material Adverse
Effect.
“Environmental Law” means all applicable federal, provincial, state, local and
foreign laws (including common law), treaties, regulations, rules, ordinances,
codes, decrees, judgments, directives, and orders (including consent orders), in
each case, relating to protection of the environment, natural resources, human
health and safety 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) compliance or 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.
“Environmental Permit” means any Permit under any Environmental Law.
“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, or any obligations convertible
into or exchangeable for, or giving any person a right, option or warrant to
acquire, such equity interests or such convertible or exchangeable obligations.
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time, and any successor statute and all rules and regulations
promulgated thereunder.
“ERISA Affiliate” means any trade or business (whether or not incorporated)
under common control with any Borrower Party within the meaning of Section
414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes
of provisions relating to Section 412 of the Code).
“ERISA Event” means (a) a Reportable Event with respect to a Pension Plan; (b) a
withdrawal by the Borrowers or any ERISA Affiliate from a Pension Plan subject
to Section 4063 of ERISA during a plan year in which it was a substantial
employer (as defined in Section 4001(a)(2) of ERISA) or a cessation of
operations that is treated as such a withdrawal under Section 4062(e) of ERISA;
(c) a complete or partial withdrawal by the Borrowers or any ERISA Affiliate
from a Multiemployer Plan or notification that a Multiemployer Plan is in
reorganization; (d) the filing of a notice of intent to terminate, the treatment
of a Plan amendment as a termination under Sections 4041 or 4041A of ERISA, or
the commencement of proceedings by the PBGC to terminate a Pension Plan or
Multiemployer Plan; (e) an event or condition which constitutes grounds under
Section 4042 of ERISA for the termination of, or the appointment of a trustee to
administer, any Pension Plan or Multiemployer Plan; (f) the imposition of any
liability under Title IV of ERISA, other than for PBGC premiums due but not
delinquent under Section 4007 of ERISA, upon any Borrower or any ERISA
Affiliate; or (g) an event or condition with respect to any Pension Plan that
has resulted or could reasonably be expected to result in any Pension Plan
having its registration revoked or refused for the purposes of any
administration of any relevant pension benefits regulatory authority or being
required to pay any Taxes under any Legal Requirements.
“Events of Default” has the meaning set forth in Section 7.01.

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“Excluded Assets” means:
(1)    vehicles and other property covered by certificates of title or ownership
to the extent that a security interest therein cannot be perfected solely by
filing a UCC-1 financing statement in the jurisdiction of organization of the
owner thereof;
(2)    fee interests in Non-Material Real Property and leasehold interests in
real property with respect to which the any Borrower Party is a tenant or
subtenant;
(3)    any asset or property right of any nature if the grant of such security
interest shall constitute or result in (A) the abandonment, invalidation or
unenforceability of such asset or property right or the loss of use of such
asset or property right or (B) a breach, termination or default under any lease,
license, contract or agreement, other than to the extent that any such term
would be rendered ineffective pursuant to Sections 9-406, 9-407, 9-408 or 9-409
of the Uniform Commercial Code (or any successor provision or provisions) of any
relevant jurisdiction or any other applicable law (including any Debtor Relief
Law) or principles of equity, to which any Borrower Party is party; provided
that the foregoing exclusions of this clause (3) shall in no way be construed to
limit, impair, or otherwise affect any of the Collateral Agent’s security
interests in and Liens upon any rights or interests of any Borrower Party in or
to (A) monies due or to become due under or in connection with any described
asset, property right, lease, license, contract or agreement, or (B) any
proceeds from the sale, license, lease, or other dispositions of any such asset,
property right, lease, license, contract or agreement;
(4)    any asset or property right of any nature to the extent that any
applicable law or regulation prohibits or restricts (including any requirements
to obtain the consent of any Governmental Authority) the creation of a security
interest thereon (other than to the extent that any such term would be rendered
ineffective pursuant to Sections 9-406, 9-407, 9¬408 or 9-409 of the Uniform
Commercial Code (or any successor provision or provisions) of any relevant
jurisdiction or any other applicable law or principles of equity); provided that
the foregoing exclusions of this clause (4) shall in no way be construed to
limit, impair, or otherwise affect any of the Collateral Agent’s continuing
security interests in and Liens upon any rights or interests of any Borrower
Party in or to (A) monies due or to become due under or in connection with any
described asset or property right, or (B) any proceeds from the sale, license,
lease, or other dispositions of any such asset or property right;
(5)    Equity Interests of (i) any Person (other than any Borrower Party), to
the extent, and for so long as, such pledge is not permitted or is restricted by
the terms of such Person’s organizational or joint venture documents or other
agreements with holders of such Capital Stock and (ii) Horsehead Zinc Recycling,
LLC, a Delaware limited liability company, or any successor thereof and (iii)
Zochem, Inc.; provided that the foregoing exclusions of this clause (5) shall in
no way be construed to limit, impair, or otherwise affect any of the Collateral
Agent’s continuing security interests in and Liens upon any rights or interests
of any Borrower Party in or to (A) monies due or to become due under or in
connection with any such Equity Interests described in clause (i) hereof, or (B)
any proceeds from the sale, license, lease, or other dispositions of any such
Equity Interests described in clause (i) hereof;
(6)    any commercial tort claims, whether now owned or hereafter acquired, if
the amount of such commercial tort claim does not exceed $2,500,000;
(7)    any intent-to-use trademark applications filed in the United States
Patent and Trademark Office to the extent that, and solely during the period in
which the grant of a security interest therein would impair the validity or
enforceability of such intent-to-use trademark applications under applicable
law; provided that, upon submission and acceptance by the United States Patent
and Trademark Office of an

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amendment to allege use pursuant to 15 U.S.C. Section 1060(a) (or any successor
provision), such intent-to-use trademark application shall cease to be
considered an Excluded Asset;
(8)    the voting Equity Interests of any Foreign Subsidiary;
(9)    property and assets owned by any Borrower Party that are the subject of
Permitted Liens described in Section 6.01(c) for so long as such Permitted Liens
are in effect and the Debt secured thereby otherwise prohibits any other Liens
thereon or creates a right of termination in favor of any party (other than any
Borrower Party);
(10)    (i) deposit and securities accounts the balance of which consists
exclusively of (a) withheld income taxes and Federal, state or local employment
taxes in such amounts as are required to be paid to the Internal Revenue Service
or state or local government agencies within the following two months with
respect to employees of any Borrower Party, and (b) amounts required to be paid
over to an employee benefit plan pursuant to DOL Reg. Sec. 2510.3-102 on behalf
of or for the benefit of employees of Horsehead Holdings or any Borrower Party,
and (ii) all segregated deposit accounts constituting (and the balance of which
consists solely of funds set aside in connection with) tax accounts and trust
accounts; and
(11)    those assets with less than $1,000,000 in value as to which the
Administrative Agent and the Borrowers mutually determine in writing that the
cost, time, or difficulty of obtaining such a security interest or perfection
thereof is excessive in relation to the benefit to the Lenders of the security
afforded thereby.
“Excluded Hedge Obligation” means, with respect to any Borrower Party
individually determined on a Borrower Party by Borrower Party basis, any
Obligation in respect of any Hedge Agreement or Physical Purchase Transaction
if, and solely to the extent that, all or a portion of the guarantee of such
Borrower Party of, or the grant by such Borrower Party of a security interest to
secure, such Obligation in respect of any Hedge Agreement or Physical Purchase
Transaction (or any guarantee thereof) is or becomes illegal under the Commodity
Exchange Act or any rule, regulation or order of the Commodity Futures Trading
Commission (or the application or official interpretation of any thereof) by
virtue of such Borrower Party’s failure for any reason to constitute an
“eligible contract participant” as defined in the Commodity Exchange Act.
“Excluded Taxes” means, 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 any Borrower hereunder, (a) taxes imposed on or measured by its overall net
income (however denominated), and franchise taxes imposed on it (in lieu of net
income taxes), by any jurisdiction (or any political subdivision thereof) under
the laws of which such recipient is organized or in which its principal office
is located or, in the case of any Lender, in which its Applicable Lending Office
is located, (b) any branch profits taxes imposed by the United States of America
or any similar tax imposed by any other jurisdiction in which any Borrower is
located and (c) in the case of a Foreign Lender (other than an assignee pursuant
to a request by any Borrower under Section 2.14), any withholding tax that is
imposed on amounts payable to such Foreign Lender at the time such Foreign
Lender becomes a party hereto (or designates a new lending office) or is
attributable to such Foreign Lender's failure or inability (other than as a
result of a Change in Law) to comply with Section 2.10(e), except to the extent
that such Foreign Lender (or its assignor, if any) was entitled, at the time of
designation of a new lending office (or assignment), to receive additional
amounts from any Borrower with respect to such withholding tax pursuant to
Section 2.10(c) and (d) any United States Federal withholding Taxes imposed
under FATCA. Notwithstanding anything to the contrary contained in this
definition, “Excluded Taxes” shall not include any withholding tax imposed at
any time on payments made by or on behalf of any Borrower if the Borrower is not
a resident of the United States for tax purposes to any Lender or Administrative
Agent hereunder or

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under any other Credit Facility Document, provided that such Lender, such
Administrative Agent shall have complied with Section 2.10(e).
“Exposure” means, as of any date, the sum of the Termination Values under any
Hedge Agreements , if any, payable by a Borrower Party to the applicable
counterparty (other than any Person party to a Hedge Agreement with a Borrower
Party if either (i) at the time such Hedge Agreement was entered into, such
Person was a Lender or Affiliate of a Lender hereunder or (ii) at any time after
such Hedge Agreement was entered into, such Person was a Lender or Affiliate of
a Lender hereunder).
“Extensions of Credit” means, as to any Lender at any time, an amount equal to
the sum of the aggregate principal amount of all Advances made or deemed made by
such Lender then outstanding.
“Facility” means the credit facility described in Section 2.01,.
“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this
Agreement (or any amended or successor version that is substantively comparable
and not materially more onerous to comply with), any current or future
regulations or official interpretations thereof and any agreements entered into
pursuant to Section 1471(b)(1) of the Code.
“Federal Funds Effective Rate” means, for any day, a fluctuating interest rate
per annum equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published for such day (or, if such day is not a
Business Day, for the immediately preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations at approximately 10:00 a.m. (New
York time) on such day on such transactions received by the Administrative Agent
from three Federal funds brokers of recognized standing selected by it.
“Federal Reserve Board” means the Board of Governors of the Federal Reserve
System or any of its successors.
“Fee Letter” means a letter dated as of even date hereof between the Borrower
Parties and MBL.
“Financial Officer” means the Vice President – Finance and/or Corporate
Controller of Borrower.
“Fiscal Year” means an accounting period beginning on January 1st and ending on
December 31st] of each year.
“Foreclosure Sale” has the meaning set forth in Section 7.06.
“Foreign Lender” means any Lender that is organized under the laws of a
jurisdiction other than that in which any Borrower is resident for tax purposes.
For purposes of this definition, the United States of America, each State
thereof and the District of Columbia shall be deemed to constitute a single
jurisdiction.
“Fraudulent Transfer Laws” has the meaning set forth in Section 9.06(b).
“Fund” means any Person (other than a natural Person) that is, or will be,
engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the Ordinary Course of Business.
“GAAP” means United States generally accepted accounting principles applied on a
consistent basis.

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“Governmental Authority” means 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).
“Guarantee” means, as to any Person, any (a) any obligation, contingent or
otherwise, of such Person guaranteeing or having the economic effect of
guaranteeing any Debt or other obligation payable or performable by another
Person (the “primary obligor”) in any manner, whether directly or indirectly,
and including any obligation of such Person, direct or indirect, (i) to purchase
or pay (or advance or supply funds for the purchase or payment of) such Debt or
other obligation or to purchase (or to advance or supply funds for the purchase
of) any security for the payment of such Debt or other obligation, (ii) to
purchase or lease property, securities or services for the purpose of assuring
the owner of such Debt or other obligation of the payment or performance of such
Debt or other obligation, (iii) to maintain working capital, equity capital or
any other financial statement condition or liquidity or level of income or cash
flow of the primary obligor so as to enable the primary obligor to pay such Debt
or other obligation, or (iv) entered into for the purpose of assuring in any
other manner the owner of such Debt or other obligation of the payment or
performance thereof or to protect such owner against loss in respect thereof (in
whole or in part), or (b) any Lien on any assets of such Person securing any
Debt or other obligation of any other Person, whether or not such Debt or other
obligation is assumed by such Person; provided, however, that the term
“Guarantee” shall not include endorsements for collection or deposit in the
Ordinary Course of Business. The amount of any Guarantee shall be deemed to be
an amount equal to the least of (x) the stated or determinable amount of the
related primary obligation, or portion thereof, in respect of which such
Guarantee is made or, (y) if not stated or determinable, the maximum reasonably
anticipated liability in respect thereof as determined by the guaranteeing
Person in good faith or (z) the fair market value of the property subject to the
relevant Lien to the extent the obligations secured by such property are
otherwise non-recourse to such Person. The term “Guarantee” as a verb has a
corresponding meaning.
“Guarantors” means the Borrowers, Horsehead Holding and Chestnut Ridge Railroad
Corp., company organized under the laws of the State of Delaware.
“Guaranty” means a Guaranty among one or more of the Guarantors and the
Administrative Agent for the benefit of the Secured Parties, in the form of the
attached Exhibit E, as amended, supplemented, and otherwise modified from time
to time.
“Hazardous Material” means (a) any petroleum products or byproducts, coal ash,
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 by or pursuant to any Environmental Law.
“Hedge Agreement” means (a) any and all rate swap transactions, basis swaps,
credit derivative transactions, forward rate transactions, commodity swaps,
commodity options, forward commodity contracts, equity or equity index swaps or
options, bond or bond price or bond index swaps or options or forward bond or
forward bond price or forward bond index transactions, interest rate options,
forward foreign exchange transactions, cap transactions, floor transactions,
collar transactions, currency swap transactions, cross-currency rate swap
transactions, currency options, spot contracts, whether on a spot basis or
otherwise, or any other similar transactions or any combination of any of the
foregoing (including any options to enter into any of the foregoing), whether or
not any such transaction is governed by or subject to any master agreement, (b)
any and all transactions of any kind, and the related confirmations, which are
subject to the

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terms and conditions of, or governed by, any form of master agreement published
by the International Hedges and Derivatives Association, Inc., any International
Foreign Exchange Master Agreement, or any other master agreement, and (c) any
other derivative agreement or other similar agreement or arrangement (including
any agreement, contract or transaction that constitutes a “swap” within the
meaning of section 1a(47) of the Commodity Exchange Act) (any such master
agreement, together with any schedules, exhibits, confirmations, addenda and
annexes thereto, a “Master Agreement”), including any such obligations or
liabilities under any Master Agreement.
“Hedge Transaction” means a Hedge Agreement that meets all of the following
requirements: (i) the purpose of such Hedge Agreement is to protect Counterparty
against commodity price, commodity availability or similar risks in respect of
Inventory, in each case, reasonably expected to arise in Counterparty’s Ordinary
Course, (ii) such Hedge Agreement (when aggregated with all other Hedge
Transactions under which Counterparty is obligated) does not result in
Counterparty being exposed to commodity prices or commodity volumes other than
with respect to commodities and volumes of such commodities reasonably expected
to be utilized or produced (as applicable) in Counterparty’s Ordinary Course
over the term of such Hedge Agreement, and (iii) such transaction is entered
into in Counterparty’s Ordinary Course.
“HMP” is defined in the first paragraph of this Agreement.
“Horsehead” is defined in the first paragraph of this Agreement.
“Horsehead Holding” means Horsehead Holding Corp., a company organized under the
laws of the State of Delaware.
“Indemnified Liabilities” shall have the meaning set forth in Section 9.05
hereof.
“Indemnified Taxes” means any Taxes other than Excluded Taxes.
“Indenture - 2011” shall mean that certain Indenture, dated the July 27, 2011,
by and among Horsehead Holding and the Indenture - 2011 Trustee.
“Indenture - 2011 Trustee” shall mean U.S. Bank, as trustee under the Indenture
- 2011, and any successor trustee thereunder.
“Indenture - 2012” shall mean that certain Indenture, dated the July 26, 2012,
by and among Horsehead Holding, the other Grantors (as defined therein) party
thereto, the Indenture - 2012 Trustee and the Indenture - 2012 Collateral Agent.
“Indenture - 2012 Collateral Agent” shall mean the Collateral Agent (as defined
in the Intercreditor Agreement - 2015).
“Indenture - 2012 Collateral Documents” shall mean the Indenture Collateral
Documents (as defined in the Intercreditor Agreement - 2015).
“Indenture - 2012 Trustee” shall mean U.S. Bank, as trustee under the Indenture
- 2012, and any successor trustee thereunder.
“Independent Auditor” means Grant Thornton LLP or any other independent auditor
registered with the Public Company Account Oversight Board that the Borrowers or
Horsehead Holding may appoint.

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“Initial Financial Statements” means (a) the audited combined balance sheets and
related statements of income or operations, shareholders' equity and cash flows
of Horsehead Holding and its consolidated Subsidiaries, on a consolidated basis,
for the Fiscal Year ended December 31, 2014, including the notes thereto, (b)
the unaudited combined balance sheets and related statements of income or
operations of Horsehead Holding and its consolidated Subsidiaries, on a
consolidated and consolidating basis, for the quarter ended March 31, 2015, (c)
the unaudited combined monthly balance sheets and related statements of income
or operations of Horsehead Holding and its consolidated Subsidiaries for the
months ended April 30, 2015 and May 31, 2015.
“INMETCO” is defined in the first paragraph of this Agreement.
“INMETCO Eligible Projected Sales Revenue” means for any month INMETCO’s
anticipated revenues from sales of goods or services under fixed prices or for
which the sale price is hedged (and taking into account such hedge) for such
month.
“INMETCO Projected Gross Margin” means for any month INMETCO Eligible Projected
Sales Revenue for such month less the anticipated cost of the goods to be sold
or services provided in connection therewith.
“INMETCO Gross Margin” means for any month the amount of revenues for sales or
services for fixed prices or with which the sales price was hedged in accordance
with the Risk Management Policy, less the cost of such goods sold or services
provided.
“Intellectual Property” shall mean property constituting under any applicable
Legal Requirement a patent, patent application, copyright, trademark, service
mark, trade name, mask work, trade secret or license or other right to use any
of the foregoing.
“Intercreditor Agreement – 2015” means an intercreditor agreement, between the
Indenture - 2012 Collateral Agent, the Indenture - 2012 Trustee, and the
Collateral Agent on behalf of the Secured Parties, in the form of the attached
Exhibit F, as amended, restated, amended and restated, or otherwise modified
from time to time.
“Interest Expense” means, for any Person, the sum of all interest charges
(including under Capital Leases and all amortization of debt discount and
expense and other deferred financing charges) of such Person and its
Subsidiaries for such period determined on a consolidated basis in accordance
with GAAP plus all fees payable in respect of the issuance of standby letters of
credit for the account of such Person and its consolidated Subsidiaries
determined on a consolidated basis in accordance with GAAP.
“Inventory” means has the meaning given to such term in the UCC plus Waelz
oxide, calcine and zinc owned by a Borrower Party.
“Investment” of any Person means any (a) loan, advance (other than commission,
travel and similar advances to officers, representatives and employees, drawing
accounts and similar expenditures or prepayments or deposits made in the
Ordinary Course of Business) to, or guarantee or assumption of Debt of a
purchase or other acquisition of any other debt or interest in, another Person,
or extension of credit that constitutes Debt of the Person to whom it is
extended; (b) contribution of capital by such Person; (c) stocks, bonds, mutual
funds, partnership interests, notes (including structured notes), debentures or
other securities owned by such Person; (d) any deposit accounts; and (e)
certificates of deposit owned by such Person (but excluding capital expenditures
of such Person determined in accordance with GAAP).

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“Investment Grade Rating” of a Person means that such Person has a minimum
investment grade rating on its senior unsecured debt securities of at least BBB-
as determined by S&P and Baa3 as determined by Moody's.
“IRS” means the United States Internal Revenue Service.
“Legal Requirement” means, as to any Person, any law, statute, ordinance,
decree, award, order, writ, judgment, injunction, rule, regulation (or official
interpretation of any of the foregoing) of, and the terms of any license or
permit issued by, any Governmental Authority which is binding on such Person.
“Lenders” means the lenders listed on the signature pages of this Agreement and
any other person that has become a party hereto pursuant to an Assignment and
Acceptance; provided that, the term “Lenders” shall not include any such person
that has ceased to be a party hereto pursuant to an Assignment and Acceptance.
“Lien” shall mean, with respect to any asset, (a) any mortgage, deed of trust,
lien (statutory or other), pledge, assignment, preference, deposit arrangement,
encumbrance, charge, security interest, priority or other security or
preferential arrangement of any kind or nature whatsoever, whether voluntary or
involuntary in or on such asset, (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 and (c) in the case of securities, any
purchase option, call or similar right of a third party with respect to such
securities.
“Market Value” means (a) with respect to the Borrowers’ Inventory in respect of
which the Borrowers have existing firm contracts to sell such Inventory, the
specified price to be paid for such Inventory under such contracts and (b) as to
other Inventory, the market value thereof determined on a basis reasonably
acceptable to the Administrative Agent.
“Material Adverse Effect” shall mean a material adverse effect upon (a) the
business, operations, Properties, financial condition, assets or liabilities of
the Borrower Parties and their Subsidiaries, taken as a whole, (b) the ability
of any Borrower Party to perform its obligations under any Credit Facility
Document to which it is a party, (c) the Collateral, or the Administrative
Agent's Liens (on behalf of itself and the Secured Parties) on the Collateral or
the priority of such Liens, (d) the legality, validity or enforceability against
any Borrower Party of any of the Credit Facility Documents or the rights or
remedies of the Administrative Agent or the Secured Parties thereunder, or (e)
the existence of any Borrower or Horsehead Holding.
“Maturity Date” means the earlier of (a) the Scheduled Maturity Date, and (b)
the acceleration of all Credit Facility Obligations pursuant to Article VII.
“Maximum Rate” means the maximum nonusurious interest rate under applicable law
(determined under such laws after giving effect to any items which are required
by such laws to be construed as interest in making such determination, including
without limitation if required by such laws, certain fees and other costs).
“MBL” means Macquarie Bank Limited, a company with limited liability organized
under the laws of Australia.
“Monaca Facility” means the Horsehead Corporation’s former zinc smelter and
refinery facility located in Monaca, Pennsylvania.

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“Moody's” means Moody's Investors Service, Inc.
“Mortgage” means a mortgage or deed of trust, as applicable, substantially in
the form agreed upon by the Borrowers and the Collateral Agent, granting an
Acceptable Lien in the Mortgaged Properties to the Collateral Agent for the
benefit of the Secured Parties subject only to the Permitted Encumbrances.
“Mortgaged Properties” means the facilities set forth on Schedule 1.01(b)
attached hereto.
“Multiemployer Plan” means any employee benefit plan of the type described in
Section 4001(a)(3) of ERISA, to which any Borrower or any ERISA Affiliate makes
or is obligated to make contributions, or during the preceding five plan years,
has made or been obligated to make contributions.
“Net Cash Proceeds” with respect to any issuance or sale of Capital Stock, means
the cash proceeds of such issuance or sale net of attorneys’ fees, accountants’
fees, initial purchasers’ or placement agents’ fees, discounts or commissions
and brokerage, consultant and other fees actually incurred in connection with
such issuance or sale and net of taxes paid or payable as a result thereof.
“Net Fixed Asset Liquidation Value” means, as of any date, the amount agreed
upon by the Administrative and the Borrowers as the deemed fixed assets
liquidation value on such date, which shall initially be $20,000,000, as such
amount shall be determined and adjusted by the Administrative Agreement from
time to time in its discretion.
“Net Income” means for any period and with respect to any Person, the net income
for such period for such Person after taxes as determined in accordance with
GAAP, excluding however, (a) extraordinary items, including (i) any net non-cash
gain or loss during such period arising from the sale, exchange, retirement or
other disposition of capital assets (such term to include all fixed assets and
securities) other than in the Ordinary Course of Business, and (ii) any write-up
or write-down of assets, (b) the cumulative effect of any change in GAAP, (c)
any equity interest in unremitted earnings of any Person that is not a
Subsidiary, and (d) income of any Person accrued prior to the date such Person
becomes a Subsidiary or is merged into or consolidated with any Borrower or any
Subsidiary on the date such Person’s assets are acquired by any Borrower or a
Subsidiary.
“Net Working Capital” means, at any date, an amount equal to (a) the Current
Assets, minus (b) Current Liabilities.
“Non-Material Real Property” means (a) the Monaca Facility, (b) the Bartlesville
Facility, (c) the Beaumont Facility and (d) any other real property with a fair
market value, including any improvements thereon before or after the acquisition
thereof, of less than $2.0 million.
“Note” has the meaning given to such term in Section 2.02(g).
“Obligations” has the meaning given such term in the CAA; provided that solely
with respect to any Transaction Party that is not an “eligible contract
participant” under the Commodity Exchange Act, Excluded Hedge Obligations of
such Transaction Party, as applicable, shall in any event be excluded from
“Obligations” owing by such Transaction Party.
“OFAC” means the United States Department of Treasury Office of Foreign Assets
Control.
“OFAC Laws” means any laws, regulations, and executive orders relating to the
economic sanctions programs administered by OFAC, including without limitation,
the International Emergency Economic

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Powers Act, 50 U.S.C. sections 1701 et seq.; the Trading with the Enemy Act, 50
App. U.S.C. sections 1 et seq.; and the Office of Foreign Assets Control,
Department of the Treasury Regulations, 31 C.F.R. Parts 500 et seq.
(implementing the economic sanctions programs administered by OFAC).
“OFAC SDN List” means the list of “Specially Designated Nationals and Blocked
Persons” maintained by OFAC.
“OFAC Violation” has the meaning assigned to such term in Section 5.15 of this
Agreement.
“Ordinary Course of Business” shall mean with respect to any Borrower Party,
operations in connection with environmental services, metals processing and
metals reclamation and all related activities incidental thereto entered into in
the ordinary course of business.
“Other Taxes” means all present or future stamp or documentary taxes or any
other excise or property taxes, charges or similar levies arising from any
payment made hereunder or under any other Credit Facility Document or from the
execution, delivery or enforcement of, or otherwise with respect to, this
Agreement or any other Credit Facility Document.
“Payment Date” means the first (1st) Business Day of each month during the term
of this Agreement, commencing on the first (1st) Business Day in the month
following the Closing Date.
“PBGC” means the Pension Benefit Guaranty Corporation or any entity succeeding
to any or all of its functions under ERISA.
“Participant” has the meaning set forth in Section 9.06(f).
“Pension Plan” means (i) any “employee pension benefit plan” (as such term is
defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
subject to Title IV of ERISA and is sponsored or maintained by any Borrower or
any ERISA Affiliate or to which any Borrower or any ERISA Affiliate contributes
or has an obligation to contribute, or in the case of a multiple employer or
other plan described in Section 4064(a) of ERISA, has made contributions at any
time during the immediately preceding five plan years, or (ii) any other pension
benefit plan or similar arrangement applicable to employees of a Borrower Party.
“Permit” means any permit, license, order, approval or other authorization under
any Legal Requirement.
“Permitted Additional Unsecured Debt” means unsecured Debt of Horsehead Holdings
which does not:
(a)exceed the sum of (x) $40.0 million plus (y) 75% of the Net Cash Proceeds
received by Horsehead Holdings since July 26, 2012 from the issue or sale of
Capital Stock of Horsehead Holdings or cash contributed to the capital of
Horsehead Holdings (in each case other than proceeds of Disqualified Stock or
sales of Capital Stock to, or contributions received from, Horsehead Holdings or
any of its Subsidiaries), to the extent such Net Cash Proceeds or cash have not
been applied to make Restricted Payments or (B) redeem Debt; or
(b)cause the ratio of (a) the aggregate Debt of Horsehead Holding and its
Subsidiaries on a consolidated basis to (b) Equity to exceed 1.2 to 1.0. For
purposes of this definition, "Debt" shall mean the aggregate, on a consolidated
basis, of all outstanding obligations (whether present

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or future, or actual or contingent, including reclamation obligations from the
operation of the zinc facility) for the payment or repayment of moneys which
have been borrowed or raised (including money raised by acceptances or leasing)
incurred by the Guarantor, as reflected on the Guarantor's financial statements
prepared in accordance with GAAP and “Equity” shall mean the sum of the issued
paid up ordinary shares of Horsehead Holding (including any share premium
account) plus (or minus) the Horsehead Holding’s retained earnings (or
accumulated deficit), as reflected on Horsehead Holdings’ financial statements
prepared in accordance with GAAP.
“Permitted Encumbrances” shall mean:
(a)    Liens in favor of the Collateral Agent for the benefit of the Secured
Parties;
(b)    Liens for taxes, assessments or other governmental charges not delinquent
or being Properly Contested;
(c)    deposits or pledges to secure obligations under worker’s compensation,
social security or similar laws, or under unemployment insurance;
(d)    deposits or pledges to secure bids, tenders, contracts (other than
contracts for the payment of money), leases, statutory obligations, surety and
appeal bonds, letters of credit, reimbursement obligations and other obligations
of like nature arising in the Ordinary Course of Business;
(e)    Liens arising by virtue of the rendition, entry or issuance against any
Borrower Party or any Subsidiary, or any property of any Borrower Party or any
Subsidiary, of any judgment, writ, order, or decree for so long as each such
Lien (i) would not constitute an Event of Default under Section 7.01(j) or is
being Properly Contested and (ii) is at all times junior in priority to any
Liens in favor of the Collateral Agent or less than $500,000;
(f)    Carriers' warehousemen's, mechanics’, workers’, materialmen’s or other
like Liens arising in the Ordinary Course of Business with respect to
obligations which are not overdue by more than 45 days or which are being
Properly Contested;
(g)    Liens placed upon fixed assets hereafter acquired to secure a portion of
the purchase price thereof, provided that (i) any such lien shall not encumber
any other property of any Borrower Party and (ii) the aggregate amount of
Indebtedness secured by such Liens incurred as a result of such purchases during
any fiscal year shall not exceed the amount provided for in Section 6.02(i);
(h)    easements (including, without limitation, reciprocal easement agreements
and utility agreements), encroachments, rights-of-way, covenants, consents,
reservations, defects or irregularities in title, variations, zoning, and other
restrictions, charges or encumbrances (whether or not recorded) affecting the
Real Property, if applicable, and which do not, individually or in the aggregate
(i) materially interfere with the occupation, use or enjoyment by the applicable
Borrower Party of its business or property so encumbered and (ii) do not
materially and adversely affect the value of such Real Property;
(i)    Liens arising from the precautionary UCC financing statements filed under
any lease or license permitted by this Agreement;

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(j)    Liens of local or state authorities for franchise or other like Taxes,
provided that such liens do not exceed One Hundred Thousand and 00/100 Dollars
($100,000.00) in the aggregate at any time for the Borrowers;
(k)    Liens on insurance policies and the proceeds thereof securing the
financing of the premiums with respect thereto;
(l)    customary rights of set-off, revocation, refund or chargeback under
deposit agreements or under the Uniform Commercial Code of banks or other
financial institutions where any Borrower Party maintains deposits (other than
deposits intended as cash collateral) in the Ordinary Course of Business;
(m)    Liens disclosed on Schedule 1.01(c);
(n)    Liens in favor of the Indenture - 2012 Collateral Agent pursuant to the
Indenture - 2012 Collateral Documents or granted in connection with a
refinancing of the Debt issued under the Indenture – 2012 permitted by the
provisions of Section 6.02(b); provided that such Liens are subject to, or
provided pursuant to the terms of, the Intercreditor Agreement – 2015 or a
replacement intercreditor agreement which is in form and substance substantially
equivalent to the Intercreditor Agreement - 2015;
(o)    judgment liens in respect of judgments that do not constitute an Event of
Default hereunder;
(p)    netting and other offset rights granted by a Borrower Party to customers
and suppliers in the Ordinary Course of Business on or with respect to payment
and other obligations owed by such Borrower Party to such customers or
suppliers;
(q)    Liens on currency, cash, cash equivalents, short term investments,
commodities deposited by a Borrower Party as collateral under any Hedge
Agreements with the counterparty thereto; provided that any such Property
subject to such Lien shall not be eligible to be in the Borrowing Base;
(r)    Liens on commodity accounts, deposit accounts and securities accounts
which are granted to a broker, bank, clearing house, exchange or other financial
institution securing obligations to such Person as a matter of Law pursuant to
applicable clearing house or exchange rules, or under any required account
agreement between a Borrower Party and such Person including (i) Liens in
respect of fees, expenses, returned items, service charges or margin
requirements relating to any such account, and (ii) Liens arising as a matter of
Law in connection with amounts owing to any such account arising from the
liquidation or close-out of such account or any contracts or transactions
relating to or contained in such account; provided that to the extent any such
Lien secures more than customary fees, expenses, returned items or service
charges, then any Property subject to such Lien shall not be eligible to be in
the Borrowing Base.
(s)    Liens (i) incurred in the ordinary course of business in connection with
the storage or shipping of goods or assets (or related assets and proceeds
thereof) which Liens are in favor of the warehouse holding or shipper of such
goods or assets and only attach to such goods or assets and (ii) in favor of
customs and revenue authorities arising as a matter of Law to secure payment of
any duties payable by any Borrower Party in connection with the importation of
goods;

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(t)    Liens arising out of conditional sale, title retention, consignment or
similar arrangements for the sale of goods entered into in the ordinary course
of business to the extent such Liens do not attach to any assets other than the
goods subject to such arrangements; provided that any such Property subject to
such Lien shall not be eligible to be in the Borrowing Base;
(u)    any interest or title of a lessor or sublessor under any lease or
sublease or license or sublicense in the ordinary course of business covering
only the assets so leased, subleased, licensed or sub-licensed;
(v)    other Liens on assets securing Debt not exceeding Two Million Five
Hundred Thousand and 00/100 Dollars ($2,500,000.00) in the aggregate at any time
for all Borrower Parties; and
(w)    any extension, renewal or replacement (or successive extensions, renewals
or replacements), in whole or in part, of any Lien referred to in the foregoing
clauses (a) through (n), provided that any such extension, renewal or
replacement Lien shall be limited to all or a part of the property that was the
subject to the Lien so extended, renewed or replaced (plus any improvements on
such property) and provided that any such extension, renewal or replacement Lien
shall not secure an amount (i.e., outstanding principal plus accrued and unpaid
interest and fees and expenses in the case of Debt permitted pursuant to this
Agreement) greater than the amount outstanding immediately prior to such
extension, renewal or replacement Lien.
“Permitted Liens” has the meaning set forth in Section 6.01.
“Person” means and includes natural persons, corporations, limited partnerships,
general partnerships, limited liability companies, limited liability
partnerships, joint stock companies, joint ventures, associations, companies,
trusts, banks, trust companies, land trusts, business trusts or other
organizations, whether or not legal entities, and governments and agencies and
political subdivisions thereof.
“Physical Purchase Transaction” means a transaction for the physical purchase or
sale of Inventory by a Borrower Party.
“Plan” means either a Pension Plan or a Multiemployer Plan.
“Pledge Agreement” means the Pledge Agreement among one or more of the Borrower
Parties and the Collateral Agent for the benefit of the Secured Parties, in a
form agreed upon by the Borrowers and the Collateral Agent, as amended,
supplemented, and otherwise modified from time to time.
“PNC Bank” means PNC Bank, National Association.
“PNC Bank Agreement” means the Revolving Credit and Security Agreement dated
September 28, 2011, among Horsehead and PNC Bank, as agent for the lenders
thereunder.
“PNC Bank Agreement Accounts” means those certain account of the Borrowers with
PNC Bank and Huntington Bank in existence pursuant to the PNC Bank Agreement.
“Pro Rata Share” means (a) before the Commitments terminate, the ratio
(expressed as a percentage) of such Lender's Commitment at such time to the
aggregate Commitments at such time and (b) thereafter, the ratio (expressed as a
percentage) of such Lender's aggregate outstanding Advances at such time to the
aggregate outstanding Advances of all the Lenders at such time. As used in
relation to any specific Advance,

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the “Pro Rata Share” shall be determined as of the date of the Advance and shall
be adjusted to reflect any assignments under Section 9.06.
“Properly Contested” shall mean, in the case of any Debt or Lien, as applicable,
of any Person (including any taxes) that is not paid as and when due or payable
by reason of such Person's bona fide dispute concerning its liability to pay
same or concerning the amount thereof, (i) such Debt or Lien, as applicable, is
being properly contested in good faith by appropriate proceedings promptly
instituted and diligently conducted; (ii) such Person has established
appropriate reserves as shall be required in conformity with GAAP; (iii) the
non-payment of such Debt will not have a Material Adverse Effect; (iv) no Lien
is imposed upon any of such Person's assets with respect to such Debt unless
such Lien is at all times junior and subordinate in priority to the Liens in
favor of the Collateral Agent (except only with respect to property taxes that
have priority as a matter of applicable state law) and enforcement of such Lien
is stayed during the period prior to the final resolution or disposition of such
dispute; (v) if such Debt or Lien, as applicable, results from, or is determined
by the entry, rendition or issuance against a Person or any of its assets of a
judgment, writ, order or decree, enforcement of such judgment, writ, order or
decree is stayed pending a timely appeal or other judicial review; and (vi) if
such contest is abandoned, settled or determined adversely (in whole or in part)
to such Person, such Person forthwith pays such Debt and all penalties, interest
and other amounts due in connection therewith.
“Property” of any Person means any interest of such Person in any property or
asset (whether real, personal or mixed, tangible or intangible).
“Qualified ECP Guarantor” means, in respect of any Hedge Agreement or Physical
Purchase Transaction, each Borrower Party that (a) has total assets exceeding
$10,000,000 at the time any guaranty of obligations under such Hedge Agreement
or Physical Purchase Transaction becomes effective or (b) otherwise constitutes
an “eligible contract participant” under the Commodity Exchange Act.
“Real Property” shall mean all of each Borrower Party's right, title and
interest in and to the owned and leased premises identified on Schedule 1.01(d)
hereto or which is hereafter owned or leased by any Borrower Party.
“Regulation T, U or X “ means Regulation T, U or X of the Federal Reserve Board,
as the same is from time to time in effect, and all official rulings and
interpretations thereunder or thereof.
“Related Parties” means, with respect to any Person, such Person's Affiliates
and the partners, directors, officers, employees, agents, representatives and
advisors of such Person and of such Person's Affiliates.
“Release” means 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.
“Reportable Event” means any of the events set forth in Section 4043(c) of
ERISA.
“Reported Week” has the meaning set forth in Section 5.06(e).
“Requested Maturity Date” has the meaning set forth in Section 2.15.
“Required Lenders” means, as of any date of determination (a) before the
Commitments terminate or expire, one or more Lenders holding more than 50% of
the Commitments and (b) thereafter, one or more

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Lenders holding more than 50% of the aggregate unpaid principal amount of
Advances at such time; provided that under clause (a), the Commitment of any
Defaulting Lender shall be excluded for purposes of making a determination of
Required Lenders and that under clause (b), the Advances held by any Defaulting
Lender shall be excluded for purposes of making a determination of Required
Lenders.
“Responsible Officer” means the President, Chief Financial Officer or General
Counsel of Borrower.
“Restricted Payment” means: (a) the declaration or making by any Borrower Party
or any of its Subsidiaries of any dividend or other distribution (whether in
cash, securities or other Property) with respect to any Equity Interest of such
Person; (b) 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 such Borrower Party or any Subsidiary thereof or any option,
warrant or other right to acquire any such Equity Interests in any Borrower
Party of any Subsidiary thereof; (c) any payment or prepayment (scheduled or
otherwise) of principal of, premium, if any, or interest on, any subordinated
debt, or the issuance of a notice of an intention to do any of the foregoing;
and (d) any payment by such Borrower Party or any Subsidiary thereof of any
management, consulting or similar fees to any Affiliate, whether pursuant to a
management agreement or otherwise.
“Risk Management Policy” means the risk management policy of the Borrower
Parties.
“Rolling Period” means, as of any date, the six (6) calendar months ending
immediately preceding such date.
“S&P” means Standard & Poor's Ratings Services, a division of The Mc-Graw Hill
Companies, Inc., or any successor that is a national credit rating organization.
“Sale and Leaseback Transaction” means any sale or other transfer of Property by
any Person with the intent to lease such Property as lessee.
“Scheduled Maturity Date” means May 15, 2017, as such date may be extended in
accordance with Section 2.15.
“Secured Parties” means the Administrative Agent, the Collateral Agent, the
Lenders any other Persons who from time to time are a Secured Party under the
CAA, and their Related Parties.
“Security Agreement” means the Security Agreement in substantially the form
agreed upon by the Borrowers and the Collateral Agent among one or more of the
Borrower Parties and the Collateral Agent for the benefit of the Secured
Parties, as amended, supplemented, and otherwise modified from time to time.
“Security Documents” means the Mortgages, the Security Agreement, any
supplemental security agreements, the Pledge Agreement, the Account Control
Agreements, and each other document, instrument or agreement executed in
connection therewith or otherwise executed in order to secure all or a portion
of the Obligations.
“Subsidiary” of a Person means any corporation, association, partnership or
other business entity of which more than 50% of the outstanding Equity Interests
having by the terms thereof ordinary voting power under ordinary circumstances
to elect a majority of the board of directors or Persons performing similar
functions (or, if there are no such directors or Persons, having general voting
power) of such entity (irrespective of whether at the time Equity Interests of
any other class or classes of such entity shall or might have voting power upon
the occurrence of any contingency) is at the time directly or indirectly owned
or

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controlled by such Person, by such Person and one or more Subsidiaries of such
Person or by one or more Subsidiaries of such Person.
“Tangible Net Worth” means, with respect to a Horsehead Holdings and its
Subsidiaries and as of the date of its determination, (a) consolidated assets of
Horsehead Holdings and its Subsidiaries, less (b) the sum of, without
duplication, (i) the consolidated liabilities of such Horsehead Holdings and its
Subsidiaries on a consolidated basis, and (ii) to the extent included in such
consolidated assets, the amount of intangible assets of Horsehead Holdings and
its Subsidiaries on a consolidated basis, all as determined in accordance with
GAAP.
“Taxes” means 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.
“Termination Date” means the date all of the following have occurred:
indefeasible repayment of all Credit Facility Obligations in full and in cash
and the complete performance of all other Credit Facility Obligations (other
than inchoate indemnity obligations and similar obligations that survive the
termination of this Agreement), the termination of the Commitments and the
Facilities, the indefeasible payment of all other Obligations and the
termination or expiration of other commitments of, and transactions and
agreements with, all Secured Parties.
“Termination Value” means, in respect of any one or more Hedge Agreements, after
taking into account the effect of any legally enforceable netting agreement
relating to such agreements or transactions and any cash collateral held by the
counterparty thereto, (a) for any date on or after the date such agreements or
transactions have been closed out and termination value(s) determined in
accordance therewith, such termination value(s), and (b) for any date prior to
the date referenced in clause (a), the amount(s) determined as the
mark-to-market value(s) for such agreements or transactions, as determined based
upon one or more mid-market or other readily available quotations provided by
any recognized dealer in such agreements or transactions (which may include a
Lender or any Affiliate of a Lender).
“UCC” means the Uniform Commercial Code as in effect on the date hereof in the
State of New York, as amended from time to time, and any successor statute.
“Unauthorized Capital Expenditures” has the meaning set forth in Section 6.05.
“Unfunded Pension Liability” means the excess of the benefit liabilities of a
Pension Plan under Section 4001(a)(16) of ERISA, over the current value of that
Pension Plan's assets, determined in accordance with the assumptions used for
funding the Pension Plan pursuant to Section 412 of the Code for the applicable
plan year.
“U.S. Bank” means U.S. Bank National Association.
“Wells Fargo Bank” means Wells Fargo Bank, National Association.
“Wells Fargo Bank Agreement” means the Credit Agreement dated June 24, 2013,
among INMETCO and Wells Fargo Bank.
“Wells Fargo Bank Agreement Accounts” means those certain account of the
Borrowers with PNC Bank and Huntington Bank in existence pursuant to the PNC
Bank Agreement.

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Section 1.02    Computation of Time Periods. In this Agreement in the
computation of periods of time from a specified date to a later specified date,
the word “from” means “from and including” and the words “to” and “until” each
means “to but excluding”.
Section 1.03    Accounting Terms.
(a)    For purposes of this Agreement, all accounting terms not otherwise
defined herein shall be construed in conformity with, and all financial data
(including financial ratios and other financial calculations) required to be
submitted pursuant to this Agreement shall be prepared in conformity with, GAAP
applied on a consistent basis, as in effect from time to time, applied in a
manner consistent with that used in preparing the Initial Financial Statements.
(b)    If at any time any Accounting Change (as defined below) would affect the
computation of any financial ratio or requirement set forth in any Credit
Facility Document, and either any Borrower or the Required Lenders shall so
request, the Administrative Agent, the Lenders and the Borrowers shall negotiate
in good faith to amend such ratio or requirement to preserve the original intent
thereof in light of such change in GAAP (subject to the approval of the Required
Lenders); provided that, until so amended, (i) such ratio or requirement shall
continue to be computed in accordance with GAAP prior to such Accounting Change
and (ii) the Borrowers shall provide to the Administrative Agent and the Lenders
financial statements and other documents required under this Agreement or as
reasonably requested hereunder setting forth a reconciliation between
calculations of such ratio or requirement made before and after giving effect to
such Accounting Change. “Accounting Changes” means: (A) changes in accounting
principles required by GAAP and implemented by the Borrowers; and (B) changes in
accounting principles recommended by the Borrowers’ accountants.
(c)    In addition, all calculations and defined accounting terms used herein
shall, unless expressly provided otherwise, when referring to any Person, refer
to such Person on a consolidated basis and mean such Person and its consolidated
subsidiaries.
Section 1.04    Miscellaneous. The definitions of terms herein shall apply
equally to the singular and plural forms of the terms defined. Whenever the
context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words “include,” “includes” and “including” shall
be deemed to be followed by the phrase “without limitation.” The word “will”
shall be construed to have the same meaning and effect as the word “shall.”
Unless the context requires otherwise (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 and (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.
ARTICLE II    
THE CREDIT FACILITIES

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Section 2.01    The Advances. Each Lender severally agrees, on the terms and
conditions set forth in this Agreement, to make Advances to the Borrowers from
time to time on any Business Day during the Availability Period in an aggregate
amount up to but not to exceed at any time outstanding its Pro Rata Share of the
Advance Limit. Each Borrowing shall be in an aggregate amount of not less than
$500,000 and shall consist of Advances made on the same day by the Lenders
ratably according to their respective Commitments. Within the limits of each
Lender's Commitment and subject to the terms hereof, the Borrowers may from time
to time borrow, prepay pursuant to Section 2.06 and reborrow under this
Section 2.01.
Section 2.02    Method of Borrowing.  
(d)    Procedure for Borrowing. Each Borrowing shall be made pursuant to a
Borrowing Request, given not later than 1:00 P.M. (New York time) on the
requested Borrowing Date, to the Administrative Agent at the Administrative
Office. The Administrative Agent shall give to each Lender prompt notice on the
day of receipt of a timely Borrowing Request. The Borrowing Request shall be in
writing specifying (A) the Borrowing Date (which shall be a Business Day), and
(B) the aggregate amount of such Borrowing. Each Lender shall make available its
Pro Rata Share of such Borrowing before 3:00 P.M. (New York time) on the
Borrowing Date in immediately available funds to the Administrative Agent at its
Applicable Lending Office or such other location as the Administrative Agent may
specify by notice to the Lenders. Except as otherwise permitted by subsection
(c) hereof, after the Administrative Agent's receipt of such funds and upon
fulfillment or waiver of the applicable conditions set forth in Article III, the
Administrative Agent will promptly make such funds available to the applicable
Borrower not later than 4:00 p.m. (New York time) on the Borrowing Date at such
account as the applicable Borrower shall specify in writing to the
Administrative Agent. In addition to the applicable conditions set forth in
Article III unless waived by the Administrative Agent, each request for a
Borrowing shall be a representation by the Borrowers that, after giving effect
to such requested Borrowing on the applicable Borrowing Date, the Borrowers are
in compliance with Section 3.02 hereof.
(e)    Notices Irrevocable. Each Borrowing Request delivered by a Borrower shall
be irrevocable and binding on the Borrowers. In the case of the initial
Borrowing, the Borrowers shall indemnify each Lender against any loss and
reasonable out of pocket cost or expense actually incurred by such Lender as a
result of any failure to fulfill on or before the Borrowing Date for such
initial Borrowing the applicable conditions set forth in Article III, including,
without limitation, any such loss, cost or expense actually incurred by reason
of the liquidation or reemployment of deposits or other funds acquired by such
Lender to fund the Advance to be made by such Lender as part of such Borrowing
when such Advance, as a result of such failure, is not made on such date.
(f)    Administrative Agent Reliance. If the Administrative Agent shall not have
received notice from a Lender before the Borrowing Date that such Lender will
not make available to the Administrative Agent such Lender's Pro Rata Share of
the Borrowing, the Administrative Agent may assume that such Lender has made its
Pro Rata Share of such Borrowing available to the Administrative Agent on the
Borrowing Date in accordance with paragraph (a) of this Section 2.02, and the
Administrative Agent may, in reliance upon such assumption, make available to
the applicable Borrower on the Borrowing Date a corresponding amount. If and to
the extent that such Lender shall not have so made its Pro Rata Share of such
Borrowing available to the Administrative Agent, such Lender and the Borrowers
severally agree to immediately repay to the Administrative Agent on demand such
corresponding amount,

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together with interest on such amount, for each day from the date such amount is
made available to a Borrower until the date such amount is repaid to the
Administrative Agent, at (i) in the case of the Borrowers, the interest rate
applicable on such day to Advances and (ii) in the case of 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. If such Lender shall repay to the Administrative Agent such
corresponding amount and interest as provided above, such corresponding amount
so repaid shall constitute such Lender's Advance as part of such Borrowing for
purposes of this Agreement even though not made on the same day as the other
Advances comprising such Borrowing. The Borrowers agree that if such Lender's
Advance as part of such Borrowing is not made available by such Lender within
three Business Days of the Borrowing Date, the Borrowers shall repay such
Lender's share of such Borrowing (together with interest thereon for each day
from the date such amount is made available to the Borrowers until such amount
is paid to the Administrative Agent, at the interest rate applicable during such
period to Advances) to the Administrative Agent not later than three Business
Days after receipt of written notice from the Administrative Agent specifying
such Lender's share of such Borrowing that was not made available to the
Administrative Agent. If the Administrative Agent shall have received notice
from a Lender before the Borrowing Date that such Lender will not make available
to the Administrative Agent such Lender's Pro Rata Share of the Borrowing, the
Administrative Agent need not make available to the applicable Borrower on the
Borrowing Date a corresponding amount.
(g)    Lender Obligations Several. The failure of any Lender to make an Advance
to be made by it as part of any Borrowing shall not relieve any other Lender of
its obligation, if any, to make its Advance on the applicable Borrowing Date. No
Lender shall be responsible for the failure of any other Lender to make an
Advance to be made by such other Lender on any applicable Borrowing Date.
(h)    Noteless Agreement; Evidence of Indebtedness.
(i)    Each Lender shall maintain in accordance with its usual practice an
account or accounts evidencing the indebtedness of the Borrowers to such Lender
resulting from the Advances 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 hereunder.
(ii)    The Administrative Agent shall maintain accounts in which it will record
(A) the amount of each Advance made hereunder, (B) the amount of any principal
or interest due and payable or to become due and payable from the Borrowers to
each Lender hereunder and (C) the amount of any sum received by the
Administrative Agent hereunder from the Borrowers and each Lender's share
thereof.
(iii)    The entries maintained in the accounts maintained pursuant to
paragraphs (i) and (ii) above shall be prima facie evidence of the existence and
amounts of the Credit Facility Obligations therein recorded; provided, however,
that the failure of the Administrative Agent or any Lender to maintain such
accounts or any error therein shall not in any manner affect the obligation of
the Borrowers to repay the Credit Facility Obligations in accordance with their
terms.
(iv)    Any Lender may request that the Advances owing to such Lender be
evidenced by a promissory note (a “Note”) in substantially the form of Exhibit
G. In such event, the Borrowers

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shall execute and deliver to such Lender such Notes payable to the order of such
Lender and its registered assigns and in substantially the form of Exhibit G.
Thereafter, the Advances evidenced by such Notes and interest thereon shall at
all times (including after any assignment pursuant to Section 9.06) be
represented by one or more Notes payable to the order of the payee named therein
or any assignee pursuant to Section 9.06, except to the extent that any such
Lender or assignee subsequently returns any such Notes for cancellation and
requests that such Advances once again be evidenced as described in paragraphs
(i) and (ii) above.
Section 2.03    Fees.
(a)    Commitment Fees. Borrowers agree to pay to the Administrative Agent for
the account of each Lender other than a Defaulting Lender a commitment fee (a
“Commitment Fee”) on the average daily amount by which such Lender's Commitment
exceeds the aggregate principal amount of such Lender's outstanding Advances
from the Closing Date until the Maturity Date (or earlier termination of the
Commitments), calculated at a rate per annum equal to 1.50%. The Commitment Fees
payable pursuant to this clause (a) are due monthly in arrears on the Payment
Date of each calendar month commencing with the first Payment Date following the
Closing Date and on the Maturity Date (or earlier termination of the
Commitments).
(b)    Agent's and Lenders’ Fees. Borrowers agree to pay to the Administrative
Agent and each Lender such fees as may have been separately agreed to between
the Borrowers and the Administrative Agent and the Borrowers and such Lender,
including without limitation those fees set forth in the Fee Letter.
(c)    Generally. All such fees shall be paid on the dates due, in immediately
available Dollars to the Administrative Agent for distribution promptly, if and
as appropriate, among the Lenders. Once paid, absent manifest error, none of
these fees shall be refundable under any circumstances.
Section 2.04    Repayment. The Borrowers hereby unconditionally promise to pay
to the Administrative Agent for the account of and ratable benefit of each
Lender the outstanding principal amount of the Advances on or before the earlier
of the Maturity Date and any date on which the Facility is terminated pursuant
to Section 2.15.
Section 2.05    Interest. The Borrowers hereby unconditionally promise to pay
interest on the unpaid principal amount of each Advance made by each Lender to
it from the date of such Advance until such principal amount shall be paid in
full, a rate per annum equal to the Contract Rate in effect from time to time,
payable in arrears on the Payment Date of each calendar month and on the
Maturity Date.
(a)    Interest Rate Limitation and Usury Recapture.
(i)    Notwithstanding anything to the contrary contained in any Credit Facility
Document, the interest paid or agreed to be paid under the Credit Facility
Documents shall not exceed the Maximum Rate. If the Administrative Agent or any
Lender shall receive interest in an amount that exceeds the Maximum Rate, the
excess interest shall be applied to prepay the principal of the Advances or, if
it exceeds such unpaid principal, refunded to the Borrowers. In determining
whether the interest contracted for, charged, or received by the Administrative
Agent or a Lender exceeds the Maximum Rate, such Person may, to the extent
permitted by applicable law, (a) characterize any payment that is not principal
as an expense, fee, or premium rather

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than interest, (b) exclude voluntary prepayments and the effects thereof, and
(c) amortize, prorate, allocate, and spread in equal or unequal parts the total
amount of interest throughout the contemplated term of the Credit Facility
Obligations hereunder.
(ii)    In the event the rate of interest chargeable under this Agreement at any
time (calculated after giving effect to all items charged which constitute
“interest” under applicable laws, including fees and margin amounts, if
applicable) is greater than the Maximum Rate, the unpaid principal amount of the
Advances shall bear interest at the Maximum Rate until the total amount of
interest paid or accrued on the Advances equals the amount of interest which
would have been paid or accrued on the Advances if the stated rates of interest
set forth in this Agreement had at all times been in effect.
(iii)    In the event, upon payment in full of the Advances and termination of
the Commitments and the Facilities, the total amount of interest paid or accrued
under the terms of this Agreement and the Advances is less than the total amount
of interest which would have been paid or accrued if the rates of interest set
forth in this Agreement had, at all times, been in effect, then the Borrowers
shall, to the extent permitted by applicable law, pay the Administrative Agent
for the account of the Lenders an amount equal to the difference between (i) the
lesser of (A) the amount of interest which would have been charged on its
Advances if the Maximum Rate had, at all times, been in effect and (B) the
amount of interest which would have accrued on its Advances if the rates of
interest set forth in this Agreement had at all times been in effect and
(ii) the amount of interest actually paid under this Agreement on its Advances.
(b)    Default Interest. Upon the occurrence and during the continuance of any
Event of Default, the Borrowers shall on demand of the Administrative Agent from
time to time pay interest, to the extent permitted by law, on the outstanding
Advances to but excluding the date of actual payment of such overdue principal,
interest or other amount (after as well as before judgment) at the rate
otherwise applicable to Advances pursuant to Section 2.05(a) plus 2% per annum.
Section 2.06    Prepayments.
(a)    Optional. The Borrowers may elect to prepay, in whole or in part, without
penalty or premium (except as otherwise provided in Section 2.07) any of the
Advances owing by it to the Lenders, after giving prior written notice of such
election, by 3:00 p.m. (New York time) on or before the Business Day of such
prepayment, to the Administrative Agent stating the proposed date and aggregate
principal amount of such prepayment. If any such notice is given, the
Administrative Agent shall give prompt notice thereof to each Lender and the
Borrowers shall prepay Advances comprising part of the same Borrowing in whole
or ratably in part in an aggregate principal amount equal to the amount
specified in such notice, together with accrued interest to the date of such
prepayment on the principal amount prepaid and amounts, if any, required to be
paid pursuant to Section 2.07 as a result of such prepayment being made on such
date; provided, however, that each partial prepayment shall be in an aggregate
principal amount not less than $1,000,000 (or such lesser amount as may then be
outstanding). Any amounts required to be paid pursuant to Section 2.07 in
connection with such prepayment shall be due and payable on the date such
prepayment is made.
(b)    Mandatory Prepayments of Advances.

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(i)    Borrowing Base Deficiency. If the aggregate Extensions of Credit exceed
the Borrowing Base, the Borrowers agree to make a mandatory prepayment of
Advances, in the amount of such excess, together with accrued interest to the
date of such prepayment on the principal amount prepaid. If the aggregate
Extensions of Credit continue to exceed the Borrowing Base after all Advances
have been repaid under the preceding sentence, the Borrowers agree to deposit
Cash Collateral in the Cash Collateral Account in an amount equal to such
excess.
(ii)    Casualty. In connection with any casualty for any Collateral for which
the casualty proceeds are not used or will not be used to restore or repair the
affected Collateral, unless an Intercreditor Agreement requires that such
proceeds be used otherwise, Borrowers agree to promptly use such proceeds to (A)
purchase tangible assets to be used in the Ordinary Course of Business, that are
made subject to the same security of the Collateral under the Security
Documents, and do not in the aggregate exceed $5,000,000, and (B) for any
insurance proceeds not used in accordance with the foregoing clause (A), make a
mandatory prepayment of the Advances with such proceeds of such casualty within
two (2) Business Days of receipt of any proceeds thereof.
(iii)    Interest and Costs of Prepayments. Each prepayment pursuant to this
Section 2.06 shall be accompanied by accrued interest on the amount prepaid to
the date of such prepayment and amounts, if any, required to be paid pursuant to
Section 2.07 as a result of such prepayment being made on such date.
(c)    Ratable Payments; Effect of Notice. Each payment of any Advance pursuant
to this Section 2.06 or any other provision of this Agreement shall be made in a
manner such that all Advances comprising part of the same Borrowing are paid in
whole or ratably in part. All notices given pursuant to this Section 2.06 shall
be irrevocable and binding upon the Borrowers.
Section 2.07    Increased Costs.
(a)    Increased Costs Generally. If any Change in Law shall:
(iv)    impose, modify or deem applicable any reserve, special deposit,
compulsory loan, insurance charge or similar requirement against assets of,
deposits with or for the account of, or credit extended or participated in by,
any Lender (except any reserve requirement reflected in the additional interest
payable under Section 2.05(c));
(v)    subject any Lender to any tax of any kind whatsoever with respect to this
Agreement, or change the basis of taxation of payments to such Lender in respect
thereof (except for Indemnified Taxes or Other Taxes covered by Section 2.10 and
the imposition of, or any change in the rate of, any Excluded Tax payable by
such Lender); or
(vi)    impose on any Lender or the London interbank market any other condition,
cost or expense affecting this Agreement;
and the result of any of the foregoing shall be 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 Borrowers 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.

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(b)    Capital Requirements. 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 Commitment of such Lender or the Advances 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 Borrowers 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)    Certificates for Reimbursement. 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) of this
Section and delivered to the Borrowers shall be conclusive absent manifest
error. The Borrowers will pay such Lender, as the case may be, the amount shown
as due on any such certificate within 10 days after receipt thereof.
(d)    Delay in Requests. 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 Borrowers shall
not be required to compensate a Lender pursuant to this Section for any
increased costs incurred or reductions suffered more than 360 days prior to the
date that such Lender, as the case may be, notifies the Borrowers 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 360
day period referred to above shall be extended to include the period of
retroactive effect thereof).
Section 2.08    Payments and Computations.
(a)    Payment Procedures. The Borrowers shall make each payment under this
Agreement not later than 12:00 Noon (New York time) on the day when due to the
Administrative Agent at the Administrative Agent's Applicable Lending Office in
immediately available funds. Each Advance shall be repaid and each payment of
interest thereon and fees shall be paid in Dollars. All payments shall be made
without setoff, deduction, or counterclaim. The Administrative Agent will
promptly thereafter, and in any event prior to the close of business on the day
any timely payment is made, cause to be distributed like funds relating to the
payment of principal, interest or fees ratably (other than amounts payable
solely to the Administrative Agent, or a specific Lender pursuant to
Section 2.03, 2.05, 2.06, 2.07, 2.08, 2.10 or 2.11, but after taking into
account payments effected pursuant to Section 9.04), in accordance with each
Lender's Pro Rata Share of the Borrowing to the Lenders for the account of their
respective Applicable Lending Offices, and like funds relating to the payment of
any other amount payable to any Lender to such Lender for the account of its
Applicable Lending Offices, in each case to be applied in accordance with the
terms of this Agreement.
(b)    Computations. All computations of interest and fees shall be made by the
Administrative Agent on the basis of a year of 360 days, in each case for the
actual number of days (including the first day, but excluding the last day)
occurring in the period for which such interest or fees are payable. Each
determination by the Administrative Agent of an interest rate shall be
conclusive and binding for all purposes, absent manifest error.

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(c)    Non-Business Day Payments. Whenever any payment shall be stated to be due
on a day other than a Business Day, such payment shall be made on the next
succeeding Business Day, and such extension of time shall in such case be
included in the computation of payment of interest or fees, as the case may be,
except as otherwise provided in the definition of Interest Period.
(d)    Agent Reliance. Unless the Administrative Agent shall have received
written notice from the Borrowers prior to the date on which any payment is due
to the Lenders that the Borrowers will not make such payment in full, the
Administrative Agent may assume that the Borrowers have made such payment in
full to the Administrative Agent on such date and the Administrative Agent may,
in reliance upon such assumption, cause to be distributed to each Lender on such
date an amount equal to the amount then due to such Lender. If and to the extent
the Borrowers shall not have so made such payment in full to the Administrative
Agent, each Lender shall repay to the Administrative Agent forthwith on demand
such amount distributed to such Lender, together with interest thereon, for each
day from the date such amount is distributed to such Lender until the date such
Lender repays such amount to the Administrative Agent, at the greater of the
Contract Rate for such day and a rate determined by the Administrative Agent in
accordance with banking industry rules on interbank compensation.
Section 2.09    Taxes.
(a)    Payments Free of Taxes. Any and all payments by or on account of any
obligation of any Borrower Party hereunder or under any other Credit Facility
Document shall be made free and clear of and without reduction or withholding
for any Indemnified Taxes or Other Taxes, provided that if any Borrower Party
shall be required by any Legal Requirement to deduct any Indemnified Taxes
(including any Other Taxes) from such payments, then (i) the sum payable shall
be increased as necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section)
the Administrative Agent, or Lender, as the case may be, receives an amount
equal to the sum it would have received had no such deductions been made, (ii)
such Borrower Party shall make such deductions and (iii) such Borrower Party
shall timely pay the full amount deducted to the relevant Governmental Authority
in accordance with Legal Requirements.
(b)    Payment of Other Taxes by the Borrowers. Without limiting the provisions
of paragraph (a) above, the Borrowers shall timely pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.
(c)    Indemnification by the Borrowers. The Borrowers shall, and do hereby,
indemnify the Administrative Agent and each Lender, within 10 days after demand
therefor, for the full amount of any Indemnified Taxes or Other Taxes (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
liability delivered to any Borrower by a Lender (with a copy to the
Administrative Agent), or by the Administrative Agent on its own behalf or on
behalf of a Lender, shall be conclusive absent manifest error.

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(d)    Evidence of Payments. As soon as practicable after any payment of
Indemnified Taxes or Other Taxes by a Borrower Party to a Governmental
Authority, such Borrower Party 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)    Status of Lenders. Any Foreign Lender that is entitled to an exemption
from or reduction of withholding tax under the law of the jurisdiction in which
the Borrowers are resident for tax purposes, or any treaty to which such
jurisdiction is a party, with respect to payments hereunder or under any other
Credit Facility Document shall deliver to the Borrowers (with a copy to the
Administrative Agent), at the time or times prescribed by applicable law or
reasonably requested by the Borrowers or the Administrative Agent, such properly
completed and executed documentation prescribed by applicable law as will permit
such payments to be made without withholding or at a reduced rate of
withholding. In addition, any Lender, if requested by the Borrowers or the
Administrative Agent, shall deliver such other documentation prescribed by
applicable law or reasonably requested by the Borrowers or the Administrative
Agent as will enable the Borrowers 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, in the event that the
Borrowers are resident for tax purposes in the United States of America, and
upon the Borrowers’ reasonable request, any Foreign Lender shall deliver to the
Borrowers 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 upon the
request of the Borrowers or the Administrative Agent, but only if such Foreign
Lender is legally entitled to do so), whichever of the following is applicable:
(i)    duly completed copies of Internal Revenue Service Form W-8BEN claiming
eligibility for benefits of an income tax treaty to which the United States of
America is a party,
(ii)    duly completed copies of Internal Revenue Service Form W-8ECI,
(iii)    in the case of a Foreign Lender claiming the benefits of the exemption
for portfolio interest under section 881(c) of the Code, (x) a certificate to
the effect that such Foreign Lender is not (A) a “bank” within the meaning of
section 881(c)(3)(A) of the Code, (B) a “10 percent shareholder” of any Borrower
within the meaning of section 881(c)(3)(B) of the Code, or (C) a “controlled
foreign corporation” described in section 881(c)(3)(C) of the Code and (y) duly
completed copies of Internal Revenue Service Form W-8BEN, or
(iv)    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 as may be prescribed by
applicable law to permit the Borrowers to determine the withholding or deduction
required to be made.
If a payment made to a Lender under any Credit Facility Document would be
subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to
fail to comply with the applicable reporting requirements of FATCA (including
those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such
Lender shall deliver to the Borrowers and the Administrative Agent at the time
or times prescribed by law and at such time or times reasonably requested by the
Borrowers

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or the Administrative Agent such documentation prescribed by applicable law
(including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such
additional documentation reasonably requested by the Borrowers or the
Administrative Agent as may be necessary for the Borrowers and the
Administrative Agent to comply with their obligations under FATCA and to
determine that such Lender has complied with such Lender’s obligations under
FATCA or to determine the amount to deduct and withhold from such payment.
Solely for purposes of this paragraph, “FATCA” shall include any amendments made
to FATCA after the date of this Agreement.
(f)    Treatment of Certain Refunds. If the Administrative Agent or a Lender
determines in its discretion that it has received a refund of any Taxes or Other
Taxes as to which it has been indemnified by the Borrowers or with respect to
which the Borrowers have paid additional amounts pursuant to this Section, it
shall pay to the Borrowers an amount equal to such refund (but only to the
extent of indemnity payments made, or additional amounts paid, by the Borrowers
under this Section with respect to the Taxes or Other Taxes giving rise to such
refund), net of all out of pocket expenses of the Administrative Agent or such
Lender, as the case may be, and without interest (other than any interest paid
by the relevant Governmental Authority with respect to such refund), provided
that the Borrowers, upon the request of the Administrative Agent or such Lender,
agree to repay the amount paid over to the Borrowers (plus any penalties,
interest or other charges imposed by the relevant Governmental Authority) to the
Administrative Agent or such Lender in the event the Administrative Agent, such
Lender is required to repay such refund to such Governmental Authority. This
paragraph shall not be construed to require the Administrative Agent, any Lender
to make available its tax returns (or any other information relating to its
taxes that it deems confidential) to the Borrowers or any other Person.
Section 2.10    Sharing of Payments, Etc. 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 Advances or other obligations hereunder
resulting in such Lender's receiving payment of a proportion of the aggregate
amount of its Advances and accrued interest thereon or other such obligations
greater than its Pro Rata Share, 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 Advances 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 Advances 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 any Borrower pursuant to and in
accordance with the express terms of this Agreement (including the application
of funds arising from the existence of a Defaulting Lender), or (y) any payment
obtained by a Lender as consideration for the assignment of or sale of a
participation in any of its Advances to any assignee or participant, other than
to a Borrower Party (as to which the provisions of this paragraph shall apply).
Each Borrower 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
Borrower Party rights of setoff and counterclaim with respect to such
participation as fully as if such Lender were a direct creditor of each Borrower
Party in the amount of such participation.
Section 2.11    Applicable Lending Offices. Each Lender may book its Advances at
the Applicable Lending Office selected by such Lender and may change its
Applicable Lending Office from time to time. All terms of this Agreement shall
apply to such Applicable Lending Office and the Advances shall be deemed

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held by each Lender for the benefit of such Applicable Lending Office. Each
Lender may, by written notice to the Administrative Agent and the Borrowers,
designate replacement or additional Applicable Lending Offices through which
Advances will be made by it and for whose account repayments are to be made.
Section 2.12    Intentionally Omitted.
Section 2.13    Mitigation Obligations; Replacement of Lenders.
(a)    Designation of a Different Lending Office. If any Lender requests
compensation under Section 2.08, or requires the Borrowers to pay any additional
amount to any Lender or any Governmental Authority for the account of any Lender
pursuant to Section 2.10, then such Lender shall use reasonable efforts to
designate a different lending office for funding or booking its 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 eliminate or reduce amounts payable pursuant to Section
2.08 or 2.10, 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. Borrower will pay all reasonable costs and
expenses incurred by any Lender in connection with any such designation or
assignment.
(b)    Replacement of Lenders. If any Lender requests compensation under Section
2.08, or if any Borrower is required to pay any additional amount to any Lender
or any Governmental Authority for the account of any Lender pursuant to Section
2.10, or if any Lender is a Defaulting Lender, then such Borrower may, at its
sole expense and effort, upon notice to such Lender and the Administrative Agent
and with the consent of the Administrative Agent (which consent shall not be
unreasonably withheld), require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in, and
consents required by, Section 9.06), all of its interests, rights and
obligations under this Agreement and the related Credit Facility 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) a
Borrower shall have paid to the Administrative Agent the assignment fee
specified in Section 9.06; (ii) such Lender shall have received payment of an
amount equal to the outstanding principal of its Advances, accrued interest
thereon, accrued fees and all other amounts payable to it hereunder and under
the other Loan from the assignee (to the extent of such outstanding principal
and accrued interest and fees) or any Borrower (in the case of all other amounts
Documents including any amounts under Section 2.07); (iii) in the case of any
such assignment resulting from a claim for compensation under Section 2.08 or
payments required to be made pursuant to Section 2.10, such assignment will
result in a reduction in such compensation or payments thereafter; and (iv) such
assignment does not conflict with Legal Requirements. 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 any
Borrower to require such assignment and delegation cease to apply.
(c)    Return of Payments. If after receipt of any payment which is applied to
the payment of all or any part of the Credit Facility Obligations, the
Administrative Agent, the Collateral Agent, or any Lender is for any reason
compelled to surrender such payment or proceeds to any Person because such
payment or application of proceeds is invalidated, declared fraudulent, set
aside, determined to be void or voidable as a preference, impermissible setoff,
or a diversion of trust funds, or for any other reason, then the Credit Facility
Obligations or part

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thereof intended to be satisfied shall be revived and continued and this
Agreement shall continue in full force as if such payment or proceeds had not
been received by the Administrative Agent, or such Lender.
Section 2.14    Termination of Commitments and Facilities.
(a)    The Commitment of each Lender shall terminate on the Maturity Date unless
previously terminated. The Borrower shall have the right, upon at least sixty
(60) days' irrevocable notice to the Administrative Agent, to terminate in whole
the Commitments and the Facility.
(b)    Any termination of the Commitments pursuant to this Section 2.15 shall be
permanent, with no obligation of the Lenders to reinstate such Commitments.
(c)    Upon the Termination Date, the Administrative Agent, Collateral Agent and
the Lenders each agree that they shall cooperate with the Borrower Parties and
any replacing financier in the prompt release, assignment or termination of any
Liens, security interests or Security Documents, all as reasonably requested by
the Borrower Parties, including (i) the Administrative Agent providing the
Collateral Agent with written notice that the Termination Date has occurred with
respect to the Credit Facility Obligations and requesting that the Collateral
Agent release (or if requested by Borrowers, assign, at Borrowers expense) any
Liens on any property granted to or held by the Collateral Agent under any
Security Document and cooperate with Borrower Parties and any replacing
financier in the release, assignment or termination of Liens.
Section 2.15    Extension of Maturity Date. Provided there exists no Default or
Event of Default, upon written notice to the Administrative Agent (which shall
promptly notify the Lenders), the Borrowers may at any time no later than 60
days prior to the Scheduled Maturity Date, request that the Scheduled Maturity
Date be extended for an additional period of 12 months (such extended date, the
“Requested Maturity Date”); provided that the Borrowers may make no more than
two requests pursuant to this Section 2.15. At the time of sending such notice,
the Borrowers (in consultation with the Administrative Agent) shall specify the
time period within which each Lender is requested to respond (which shall in no
event be less than 15 days from the date of delivery of such notice to the
Lenders). Each Lender shall notify the Administrative Agent within such time
period whether or not it agrees to extend the Scheduled Maturity Date to the
Requested Maturity Date. Any Lender not responding within such time period shall
be deemed to have declined to extend the Maturity Date to the Requested Maturity
Date. The Administrative Agent shall notify the Borrowers and each Lender of the
Lenders' responses to each request made hereunder. If Administrative Agent and
each of the Lenders consent to the extension of the Scheduled Maturity Date to
the Requested Maturity Date, the Scheduled Maturity Date shall automatically,
without the need for further action on the part of the Administrative Agent, the
Borrowers or the Lenders, be extended to the Requested Maturity Date.
Section 2.16    Defaulting Lenders.
(a)    Adjustments. Notwithstanding anything to the contrary contained in this
Agreement, if any Lender becomes a Defaulting Lender, then, until such time as
that Lender is no longer a Defaulting Lender, to the extent permitted by
applicable Legal Requirements:

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(i)    Waivers and Amendments. Such Defaulting Lender's right to approve or
disapprove any amendment, waiver or consent with respect to this Agreement shall
be restricted as set forth in Section 9.01.
(ii)    Reallocation of Payments. Any payment of principal, interest, fees or
other amounts received by the Administrative Agent for the account of such
Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to
Article VII or otherwise, and including any amounts made available to the
Administrative Agent by that Defaulting Lender pursuant to Section 7.05), shall
be applied at such time or times as may be determined by the Administrative
Agent as follows: first, to the payment of any amounts owing by that Defaulting
Lender to the Administrative Agent hereunder; second, to the payment of any
amounts owing to the Lenders as a result of any judgment of a court of competent
jurisdiction obtained by any Lender against that Defaulting Lender as a result
of that Defaulting Lender's breach of its obligations under this Agreement;
fifth, so long as no Default or Event of Default exists, to the payment of any
amounts owing to the Borrowers as a result of any judgment of a court of
competent jurisdiction obtained by any Borrower against that Defaulting Lender
as a result of that Defaulting Lender's breach of its obligations under this
Agreement; and sixth, to that Defaulting Lender or as otherwise directed by a
court of competent jurisdiction. Any payments, prepayments or other amounts paid
or payable to a Defaulting Lender that are applied (or held) to pay amounts owed
by a Defaulting Lender or to post Cash Collateral pursuant to this Section
2.16(a)(ii) shall be deemed paid to and redirected by that Defaulting Lender,
and each Lender irrevocably consents hereto.
(b)    Defaulting Lender Cure. If the Borrowers and the Administrative Agent
agree in writing that a Defaulting Lender is no longer a Defaulting Lender, the
Administrative Agent will so notify the parties hereto, whereupon as of the
effective date specified in such notice and subject to any conditions set forth
therein (which may include arrangements with respect to any Cash Collateral),
that Lender will, to the extent applicable, purchase that portion of outstanding
Advances of the other Lenders or take such other actions as the Administrative
Agent may determine to be necessary to cause the Advances to be held on a pro
rata basis by the Lenders in accordance with their Pro Rata Share, whereupon
that Lender will cease to be a Defaulting Lender; provided that no adjustments
will be made retroactively with respect to fees accrued or payments made by or
on behalf of the Borrowers while that Lender was a Defaulting Lender; and
provided, further, that except to the extent otherwise expressly agreed by the
affected parties, no change hereunder from Defaulting Lender to Lender will
constitute a waiver or release of any claim of any party hereunder arising from
that Lender's having been a Defaulting Lender.
.
ARTICLE III    
CONDITIONS OF LENDING
Section 3.01    Initial Conditions Precedent. The obligation of each Lender to
make an Advance requested to be made by it on the Closing Date, in accordance
with the terms hereof is subject to the satisfaction, negotiation of a
post-closing letter among the Administrative Agent and Borrowers or due waiver
in accordance with Section 9.01 of each of the following conditions precedent:
(i)    Documentation. On or before the Closing Date, the Administrative Agent
and the Lenders shall have received the following, each dated on or before such
day, duly executed

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by all the parties thereto, each in form and substance reasonably satisfactory
to the Administrative Agent and the Lenders:
(i)    this Agreement and all attached Exhibits and Schedules;
(ii)    a Note, if requested by any Lender pursuant to Section 2.02(g) payable
to the order of such requesting Lender in the amount of its Commitment;
(iii)    the Security Agreement, together with (A) supplemental security
agreements with respect to Intellectual Property that are necessary to create an
Acceptable Lien in the applicable Borrower’s Party’s interest in such
Intellectual Property, (B) UCC financing statements and any other documents,
agreements or instruments (including lien releases with respect to any
Collateral currently subject to a Lien other than Permitted Liens) necessary to
create an Acceptable Lien in the Collateral described therein to the extent
described therein, and (C) lien, judgment, and, where customarily conducted, tax
searches conducted on the Borrower Parties reflecting no Liens other than
Permitted Liens against any of the Collateral;
(iv)    a Mortgage on each Mortgaged Property, fully notarized, together with
(A) evidence that the Mortgage has been recorded (or will be recorded with
assurance from the Title Company that it will provide affirmative coverage from
the Closing Date) in all places to the extent necessary, to create an Acceptable
Lien in the applicable Borrower Party’s interest in the Real Property described
therein to the extent described therein, (B) UCC fixture financings statements,
as applicable, (C) a commitment from a title company reasonably acceptable to
the Collateral Agent, in its sole discretion, to issue a title insurance policy
assuring the Collateral Agent, on behalf of the Secured Parties, that such
Mortgage creates an Acceptable Lien in the applicable Borrower’s Party’s
interest in the Real Property described therein, (D) copies of existing surveys
and maps or plans of the real estate described in the Mortgage;
(v)    the Pledge Agreement;
(vi)    the Intercreditor Agreement - 2015;
(vii)    the CAA;
(viii)    if any deposit account of any Borrower Party is held with a financial
institution that is not the Administrative Agent, an agreement or agreements in
form and substance reasonably acceptable to the Administrative Agent between the
Administrative Agent, the applicable Borrower Party and such other financial
institution governing any such deposit accounts (an “Account Control Agreement”)
subject to Account Control Agreements pursuant to which the Administrative Agent
has an Acceptable Lien;
(ix)    a certificate from the Borrowers, signed by a Responsible Officer,
stating that (A) all representations and warranties of the Borrower Parties set
forth in this Agreement and in the other Credit Facility Documents are or were
true and correct in all material respects as of the specified date of such
representation or warranty (provided that such materiality qualifier shall not
apply if such representation or warranty is already subject to a materiality
qualifier); (B) no Default has occurred and is continuing; and (C) subject to a
post-closing letter or waiver thereof, the conditions in this Section 3.01 have
been met;

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(x)    copies of the certificate or articles of incorporation, certificate of
formation or other equivalent organizational documents, including all amendments
thereto, of each Borrower Party, certified as of a recent date by the Secretary
of State of the state of its organization;
(xi)    a certificate of the Secretary or Assistant Secretary or other officer
of the Borrowers certifying (A) that attached thereto is a true and complete
copy of the by-laws, limited liability company agreement or other equivalent
organizational documents of each Borrower 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 members, Board of Directors or applicable
governing body of each Borrower Party authorizing the execution, delivery and
performance by each Borrower Party of the Credit Facility Documents to which
such Borrower Party is a party and, in the case of the Borrowers, 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 of formation
or articles of incorporation or other equivalent organizational documents of
each Borrower Party have not been amended since the date of the last amendment
thereto shown on the certificate of good standing furnished pursuant to clause
(xi) below, and (D) as to the incumbency and specimen signature of each officer
executing any Credit Facility Document, Borrowing Request or any other document
delivered in connection herewith on behalf of a Borrower;
(xii)    certificates from the appropriate Governmental Authority certifying as
to the good standing, status, existence and authority of each of the Borrower
Parties their respective jurisdictions;
(xiii)    such customary favorable opinions of counsel to the Borrowers and the
other Borrower Parties, addressed to the Administrative Agent and the Lenders
and concerning such matters as the Administrative Agent may reasonably request;
(xiv)    a certificate from the Borrowers, signed on its behalf by the Financial
Officer of the Borrowers, addressed to the Administrative Agent and each of the
Lenders regarding the matters set forth in Section 4.17;
(xv)    a copy of, or a certificate as to coverage under, the insurance policies
(“Borrower Insurance Policies”) required by Section 5.04 and the applicable
provisions of the Security Documents;
(xvi)    a Borrowing Base Certificate dated as of June 26, 2015;
(xvii)    IRS form W-9 of Borrower;
(xviii)    the Fee Letter in form and substance reasonably satisfactory to the
parties thereto; and
(xix)    duly executed Approved Bailee Letters with respect to all Inventory of
the Borrower Parties located at locations not owned by a Borrower Party in fee
simple, if any;
(xx)    the Initial Financial Statements; and
(xxi)    such other documents, governmental certificates and agreements as the
Administrative Agent or any Lender may reasonably request.

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(j)    Minimum Net Working Capital. As of Closing Date, Net Working Capital was
no less than $10,000,000, as certified by the Borrowers, signed on its behalf by
the Financial Officer.
(k)    Payment of Fees. On the Closing Date, the Borrowers shall have paid the
fees required to be paid to the Administrative Agent on the Closing Date and all
other costs and expenses which have been invoiced and are payable pursuant to
Section 9.04.
(l)    Due Diligence. The Administrative Agent and the Lenders shall have
completed reasonable, satisfactory due diligence review of the assets,
liabilities, business, operations and condition (financial or otherwise) of the
Borrower Parties, and all legal, financial, accounting, environmental,
governmental, commercial, title, tax and regulatory matters, and fiduciary
aspects of the proposed financing.
(m)    Authorizations and Approvals. All Governmental Authorities and Persons
shall have approved or consented to the transactions contemplated hereby, to the
extent required, and such approvals shall be in full force and effect, and all
applicable waiting periods shall have expired without any action being taken or
threatened that would restrain, prevent or otherwise impose adverse conditions
on this Agreement and the transactions contemplated hereby and thereby.
(n)    Risk Management Policy. The Administrative Agent and the Lenders shall
have received final copies of the Risk Management Policy, which will be in full
force and effect.
(o)    Environmental. The Administrative Agent and the Lenders shall have
received Public data base searches on each Mortgaged Property.
(p)    Credit Approvals. The Administrative Agent and the Lenders shall have
received all requisite management and internal risk approvals in connection with
the Credit Facility Documents and the Commitments.
(q)    Flood Hazard. To the extent the surveys do not provide evidence that the
Mortgaged Properties are not in any flood hazard area, Borrowers shall provide
Administrative Agent with a flood certification satisfactory to Lender which
certifies that the real estate comprising the Mortgaged Properties is not
situated within a special flood hazard area for which Lender would require flood
insurance under applicable laws, rules and regulations.
(r)    Title Insurance. The Collateral Agent shall have received Title Insurance
covering each Mortgaged Premises in amounts and with coverages agreed upon by
Borrowers and the Administrative Agent
(s)    Existing Credit Facilities. Borrowers shall provide evidence to the
Administrative Agent that (i) the PNC Bank Agreement and all transactions
entered into in connection with such agreement have been terminated, and all
Liens granted in connection therewith have been or will be released and (ii) the
Wells Fargo Bank Agreement and all transactions entered into in connection with
such agreement have been terminated, and all Liens granted in connection
therewith have been or will be released.

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Section 3.02    Conditions Precedent to Each Borrowing. The obligation of each
Lender to make an Advance on the occasion of each Borrowing and on the Closing
Date shall be subject to the delivery of a Borrowing Request as provided in
Section 2.02(a) and the further conditions precedent that on the Borrowing Date,
the following statements shall be true (and each of the giving of the applicable
Borrowing Request and the acceptance by any Borrower of the proceeds of such
Advance shall constitute a representation and warranty by the Borrowers that on
the date of such Advance, or the date of such issuance or increase such
statements are true):
(d)    the representations and warranties contained in Article IV and in each
other Credit Facility Document are correct in all material respects (provided
that such materiality qualifier shall not apply if such representation or
warranty is already subject to a materiality qualifier in Article IV or such
other Credit Facility Document) on and as of the date of such Advance before and
after giving effect to such Advance and to the application of the proceeds from
such Advance, as though made on, and as of such date (except to the extent such
representations or warranties relate to a specific earlier date, in which case
such representations or warranties shall be correct in all material respects
(provided that such materiality qualifier shall not apply if such representation
or warranty is already subject to a materiality qualifier in Article IV or such
other Credit Facility Document) as of such earlier date);
(e)    no Default or Event of Default has occurred and is continuing or would
result from such Advance or from the application of the proceeds therefrom;
(f)    no event or events that, individually or in the aggregate, has had, or is
reasonably likely to have a Material Adverse Effect has occurred and is
continuing; and
(g)    in the case of the first Advance after the Closing Date, a Borrowing Base
Certificate dated within one week of such Advance.
Section 3.03    Determinations Under Sections 3.01 and 3.02. For purposes of
determining compliance with the conditions specified in Sections 3.01 and 3.02,
each Lender shall be deemed to have consented to, approved or accepted or to be
satisfied with each document or other matter required thereunder to be consented
to or approved by or acceptable or satisfactory to the Lenders unless an officer
of the Administrative Agent responsible for the transactions contemplated by the
Credit Facility Documents shall have received written notice from such Lender
prior to the Borrowings hereunder specifying its objection thereto and such
Lender shall not have made available to the Administrative Agent such Lender's
ratable portion of such Borrowings.
ARTICLE IV    
REPRESENTATIONS AND WARRANTIES
Each Borrower represents and warrants each of the following to the
Administrative Agent, the Lenders, on and as of the Closing Date and immediately
after giving effect to the making of the Advances and the other financial
accommodations on the Closing Date and on and as of each date as required by
Section 3.02(a):
Section 4.01    Formation and Existence. Each of the Borrower Parties is duly
formed, validly existing, and in good standing under the laws of the
jurisdiction of its formation and in good standing and qualified to do business
in each jurisdiction where its ownership or lease of Property or conduct of its
business requires such qualification and where a failure to be so qualified
could reasonably be expected to have a

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Material Adverse Effect. No Borrower Party owns, directly or indirectly, any
Equity Interests, except as set forth on Schedule 4.01.
Section 4.02    Power and Authority. Each of the Borrower Parties has the
requisite power and authority to own its assets and carry on its business and
execute and deliver the Credit Facility Documents to which it is a party and to
perform its obligations thereunder. The execution, delivery, and performance by
each Borrower Party of this Agreement and the other Credit Facility Documents to
which it is a party and the consummation of the transactions contemplated hereby
(a) to the extent applicable, have been duly authorized by all necessary
organizational action, (b) do not and will not (i) to the extent applicable,
contravene the terms of any such Person's organizational documents, (ii) violate
any Legal Requirement, or (iii) conflict with or result in any breach or
contravention of, or the creation of any Lien (except Liens arising under the
Credit Facility Documents and Permitted Liens) under (A) the provisions of any
indenture, material instrument or material agreement to which such Borrower
Party is a party or is subject, or by which it, or its Property, is bound or (B)
any order, injunction, writ or decree of any Governmental Authority or any
arbitral award to which such Person or its property is subject.
Section 4.03    Authorization and Approvals. No authorization, approval,
consent, exemption, or other action by, or notice to or filing with, any
Governmental Authority or any other Person is necessary or required on the part
of any Borrower Party in connection with the execution, delivery and performance
by, or enforcement against, any Borrower Party of this Agreement and the other
Credit Facility Documents to which it is a party or the consummation of the
transactions contemplated hereby or thereby, except actions by, and notices to
or filings with, Governmental Authorities that may be required in the Ordinary
Course of Business from time to time, that may be required to comply with the
express requirements of the Credit Facility Documents (including, without
limitation, to release existing Liens on the Collateral or to comply with
requirements to perfect, and/or maintain the perfection of, Liens created for
the benefit of the Secured Parties) or that have already been obtained.
Section 4.04    Enforceable Obligations. This Agreement has been, and each other
Credit Facility Document, when delivered hereunder, will have been, duly
executed and delivered by each Borrower Party that is a party thereto. This
Agreement constitutes, and each other Credit Facility Document when so delivered
will constitute, a legal, valid and binding obligation of each Borrower Party
that is a party thereto, enforceable against such Borrower Party in accordance
with its terms, except as such enforceability may be limited by any applicable
bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium, or
similar law affecting creditors' rights generally or general principles of
equity.
Section 4.05    Financial Statements; No Material Adverse Effect.
(e)    The Initial Financial Statements and each of the financial statements
delivered pursuant to Section 5.06(a), (b) and (c), were prepared in accordance
with GAAP consistently applied throughout the period covered thereby, except as
otherwise expressly noted therein; (ii) fairly present the consolidated
financial condition of Horsehead Holding and its Subsidiaries as of the date
thereof and their consolidated results of operations for the period covered
thereby in accordance with GAAP consistently applied throughout the period
covered thereby, except as otherwise expressly noted therein; and (iii) to the
extent required by GAAP, show all material Debt and other liabilities, direct or
contingent, of each Borrower Party as of the date thereof, including liabilities
for taxes, material commitments and Debt.

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(f)    Since December 31, 2014, there has been no event or circumstance, either
individually or in the aggregate, that has had or could reasonably be expected
to have a Material Adverse Effect.
(g)    With respect to the representation and warranty made on the Closing Date
only, none of the Borrower Parties has any Debt other than that reflected on
Schedule 6.02(b) attached hereto.
Section 4.06    True and Complete Disclosure. Each of the Borrower Parties has
disclosed to the Administrative Agent and the Lenders all agreements,
instruments and corporate or other restrictions to which it or any of its
Subsidiaries is subject, and all other matters known to it, that, individually
or in the aggregate, could reasonably be expected to result in a Material
Adverse Effect. No written information, report, financial statement, exhibit or
schedule (excluding projections, estimates, and pro forma financial information)
furnished by or, to the knowledge of any Borrower Party, on behalf of any
Borrower Party to the Administrative Agent or any Lender in connection with the
negotiation of any Credit Facility Document or included therein or delivered
pursuant thereto contained, contains or will contain, as of the date furnished,
any material misstatement of fact or omitted, omits or will omit, as of the date
furnished, to state any material fact necessary to make the statements therein,
taken as a whole, in the light of the circumstances under which they were, are
or will be made, not misleading. No representation or warranty is made with
respect to any projections, estimates and pro forma financial information
provided by or on behalf of any Borrower Party except that such projections,
estimates, and pro forma financial information furnished by any Borrower Party
were prepared in good faith on the basis of assumptions, data information, tests
or conditions believed to be reasonable at the time such projections, estimates,
and pro forma financial information were furnished. No facts are known to the
Borrower Parties that have not been disclosed to the Administrative Agent and
the Lenders in writing which could reasonably be expected to have a Material
Adverse Effect.
Section 4.07    Litigation. There are no actions, suits, proceedings, claims or
disputes pending or, to the knowledge of any Responsible Officer after
reasonable inquiry, threatened in writing, at law, in equity, in arbitration or
before any Governmental Authority, by or against any Borrower Party, or any of
their properties or revenues that (a) purport to affect or pertain to this
Agreement or any other Credit Facility Document, or the transactions
contemplated hereby or thereby, or (b) either individually or in the aggregate,
if determined adversely, could reasonably be expected to have a Material Adverse
Effect.
Section 4.08    Compliance with Laws. None of the Borrower Parties, their
respective Subsidiaries or any of their respective properties is in violation
of, nor will the continued operation of their properties as currently conducted
violate, any Legal Requirement (including any applicable Environmental Law) or
is in default with respect to any judgment, writ, injunction, decree or order of
any Governmental Authority in neither case that would reasonably be expected to
have a Material Adverse Effect.
Section 4.09    No Default. Except as described in Schedule 4.09, none of the
Borrower Parties or any of their Subsidiaries is a party to any agreement or
instrument or subject to any corporate restriction that has resulted or could,
either individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect. Except as described in Schedule 4.09, none of the
Borrower Parties or any of their Subsidiaries is in a material non-payment
default or in a payment default of any indenture or other agreement or
instrument evidencing Debt in excess of $1,000,000, 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. No Default has occurred and is
continuing or would result from the consummation of the transactions
contemplated by this Agreement or any other Credit Facility Document.

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Section 4.10    Properties and Contracts.
(a)    Each of the Borrower Parties and their respective Subsidiaries has good
title to, or valid leasehold interests in, all its real and personal property
material to its business, free and clear of all Liens, except for Permitted
Liens and other minor defects in title that do not interfere with its ability to
conduct its business as currently conducted or to utilize such properties for
their intended purposes.
(b)    Each of the Borrower Parties and their respective Subsidiaries owns, or
is licensed to use, all trademarks, tradenames, copyrights, patents and other
Intellectual Property material to its business, and the use thereof by such
Borrower Party or Subsidiary does not to such Borrower Party's knowledge
infringe upon the rights of any other Person. The nature and ownership or
licensing of all Intellectual Property material to any Borrower Party on the
Closing Date is set forth on Schedule 4.10(b).
(c)    A true and complete list of all consignment agreements to which any
Borrower Party is a party on the Closing Date are set forth on Schedule 4.10(c),
such contracts have not been amended or modified except as set forth on Schedule
4.10(c), and no default exists thereunder except as set forth on Schedule
4.10(c).
(d)    No Borrower Party is a party to any Hedge Agreement other than with
Persons disclosed to the Administrative Agent.
(e)    Except as set forth on Schedule 4.10(e), no Borrower maintains any
deposit accounts (as defined in the UCC), securities entitlement accounts (as
defined in the UCC), commodities accounts, or postal boxes as of the Closing
Date.
Section 4.11    Environmental Condition.
(d)    Except as set forth on Schedule 4.11, and, with respect to
representations and warranties made on the Closing Date, each of the Borrower
Parties and their respective Subsidiaries (i) have obtained all material
Environmental Permits necessary for the ownership and operation of their
respective material Properties and the conduct of their respective businesses;
(ii) have been and are in compliance with all material terms and conditions of
such Environmental Permits and with all other material requirements of
applicable Environmental Laws; (iii) have not received written notice of any
material violation or alleged material violation of any Environmental Law or
such Environmental Permits; and (iv) are not subject to any material actual or
contingent action (including by governmental agencies and employees), lawsuit,
claim, demand, regulatory action or proceeding, order, decree, consent agreement
or written notice of potential or actual responsibility or violation (including
laws or requirements relating to health or safety of employees) which seeks to
impose liability under any Environmental Law. With respect to representations or
warranties made after the Closing Date, each of the Borrower Parties and their
respective Subsidiaries (i) have obtained all material Environmental Permits
necessary for the ownership and operation of their respective material
Properties and the conduct of their respective businesses; (ii) have been and
are in compliance with all material terms and conditions of such Environmental
Permits and with all other material requirements of applicable Environmental
Laws; (iii) have not received written notice of any material violation or
alleged material violation of any Environmental Law or such Environmental
Permits; and (iv) are not subject to any material actual or contingent action
(including by

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governmental agencies and employees), lawsuit, claim, demand, regulatory action
or proceeding, order, decree, consent agreement or written notice of potential
or actual responsibility or violation (including laws or requirements relating
to health or safety of employees) which seeks to impose liability under any
Environmental Law, except, in any such case where the resulting Environmental
Liability from a breach of the same would not reasonably be expected to exceed
$5,000,000.
(e)    Except as set forth on Schedule 4.11, none of the present or, to the
knowledge of the Borrower Parties, previously owned or operated Properties of
the Borrower Parties or any of their respective present or former Subsidiaries,
wherever located, (i) has been placed on or proposed to be placed on the
National Priorities List, CERCLIS, or their state or local analogs, nor has any
Borrower Party or any of its Subsidiaries received written notification of the
designation, listing or identification of any Property of any Borrower Party or
any of its present or former Subsidiaries as a potential site for removal,
remediation, cleanup, closure, restoration, reclamation, or other response
activity under any Environmental Laws (except as such activities may be required
by permit conditions) by the Borrower Parties; (ii) is subject to a Lien,
arising under or in connection with any applicable Environmental Laws, that
attaches to any revenues or to any Property owned or operated by any Borrower
Party or any of its present Subsidiaries, wherever located; or (iii) has been
the site of any Release of Hazardous Materials from present or past operations
which has caused at the site or at any third‑party site any condition that has
resulted in or could reasonably be expected to result in the need for Response
(as defined under any applicable Environmental Law) by the Borrower Parties and
none of the Borrower Parties or, to the knowledge of the Borrower Parties, any
of their present or former Subsidiaries has generated or transported or has
caused to be generated or transported Hazardous Materials to any third party
site which could reasonably be expected to result in the need for Response by
the Borrower Parties.
(f)    Except as set forth on Schedule 4.11, there are no existing requirements
under applicable Environmental Laws under which any Borrower Party or any of its
Subsidiaries has material liabilities.
Section 4.12    Insurance.
(d)    Schedule 4.12 sets forth a true, complete and correct list of all
insurance maintained by the Borrower Parties or by the Borrower Parties for
their respective Subsidiaries as of the Closing Date. As of such date, such
insurance is in full force and effect and all premiums have been duly paid.
(e)    The properties of each Borrower Party and its respective Subsidiaries are
insured with, to the knowledge of the Borrower Parties, financially sound and
reputable insurance companies not Affiliates of any Borrower Party, 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 such Borrower Party or Subsidiary operates.
Section 4.13    Taxes. The Borrower Parties and their Subsidiaries have filed
all Federal, state and other tax returns and reports required to be filed, and
have paid all Federal, state and other taxes, assessments, fees and other
governmental charges levied or imposed upon them or their properties, income or
assets otherwise due and payable, except those which are being Properly
Contested. There is no proposed tax

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assessment against any Borrower Party or any Subsidiary thereof other than those
for taxes not yet payable or being contested in accordance with the foregoing
sentence.
Section 4.14    ERISA Compliance.
(c)    Each of the Borrower Parties and their ERISA Affiliates is in material
compliance with the applicable provisions of ERISA and the Code and the
regulations and published interpretations thereunder to the extent of the
applicability of such laws, regulations and interpretations to any Borrower
Party or any ERISA Affiliate of a Borrower Party.
(d)    Each Pension Plan is in material compliance with the applicable
provisions of ERISA, the Code or other Federal or state laws. Each Pension Plan
that is intended to qualify under Section 401(a) of the Code has received a
favorable determination letter from the IRS or an application for such a letter
is currently being processed by the IRS with respect thereto, or such plan is
maintained on a prototype document for which a favorable opinion letter has been
issued by the IRS, and, to the best knowledge of any Borrower Party, nothing has
occurred which would prevent, or cause the loss of, such qualification. Each
Borrower Party and each ERISA Affiliate have made all required contributions to
each Multiemployer Plan, and no application for a funding waiver or an extension
of any amortization period pursuant to Section 412 of the Code has been made
with respect to any Pension Plan. All liabilities under each such Pension Plan
are funded, on a going concern and solvency basis, in accordance with the terms
of the respective Pension Plans and the most recent actuarial report filed with
respect to the Pension Plan. As of the Closing Date no Borrower Party is a party
or participant in any Pension Plan or Multiemployer Plan except a 401(k) plan.
(e)    (i) No ERISA Event has occurred or is reasonably expected to occur that,
when taken together with all other such ERISA Events, could reasonably be
expected to result in liability of any Borrower Party or any of its ERISA
Affiliates in excess of $500,000; (ii) no Pension Plan has any Unfunded Pension
Liability; (iii) neither any Borrower Party nor any ERISA Affiliate has
incurred, or reasonably expects to incur, any material liability under Title IV
of ERISA with respect to any Pension Plan other than premiums due and not
delinquent under Section 4007 of ERISA; (iv) neither any Borrower Party nor any
ERISA Affiliate has incurred, or reasonably expects to incur, any material
liability (and no event has occurred which, with the giving of notice under
Section 4219 of ERISA, would result in such liability) under Sections 4201 or
4243 of ERISA with respect to a Multiemployer Plan; and (v) neither any Borrower
Party nor any ERISA Affiliate has engaged in a transaction that could be subject
to Sections 4069 or 4212(c) of ERISA.
(f)    No condition exists and no event or transaction has occurred with respect
to any Pension Plan that could reasonably be expected to result in any Borrower
Party incurring any liability, fine or penalty which could be expected to have a
Material Adverse Effect.
Section 4.15    Security Interests.
(a)    The Security Documents other than the Mortgages are effective to create
in favor of the Collateral Agent, for the ratable benefit of the Secured
Parties, legal, valid and enforceable security interests in the Collateral
described in such Security Documents and when financing statements in
appropriate form are filed in the offices specified on Schedule I to the
Security Agreement, such Security Documents shall constitute a fully perfected
Acceptable Lien

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on and in all right, title and interest of the grantors thereunder in such
portion of the Collateral in which a security interest may be perfected by the
filing of a financing statement or by control under the applicable UCC, as
security for the Obligations, prior and superior in right to any other person,
other than Permitted Liens.
(b)    The Mortgages are effective to create in favor of the Collateral Agent,
for the ratable benefit of the Secured Parties, legal, valid and enforceable
security interest on the real property described therein and when the Mortgages
are filed in the registry offices specified in the Mortgages or in the registry
office designated by the Borrowers, such Mortgages shall constitute an
Acceptable Lien on and in, all right, title and interest of the Borrower Parties
in the real property described therein and the proceeds thereof, as security for
the Obligations, prior and superior in right to any other person, other than
Permitted Liens.
Section 4.16    Labor Relations. There (a) is no unfair labor practice complaint
pending against any Borrower Party or any of their respective Subsidiaries or,
to the knowledge of any Responsible Officer, threatened in writing against any
of them, before any Governmental Authority, and no grievance or arbitration
proceeding arising out of or under any collective bargaining agreement is so
pending against any Borrower Party or, to the knowledge of any Responsible
Officer, threatened in writing against any of them, (b) are no strikes,
lockouts, slowdowns or stoppage against any Borrower Party or any of their
respective Subsidiaries pending or, to the best of the knowledge of any Borrower
Party or any Subsidiary, threatened and (c) is no union certification
application or representation petition existing with respect to the employees of
any Borrower Party or any of their respective Subsidiaries, no union organizing
activities are taking place. No grievance or arbitration arising out of or under
any collective bargaining agreement is pending against any of the Borrower
Parties or any of their respective Subsidiaries or, to the knowledge of any
Responsible Officer, threatened in writing against any of them. The hours worked
by and payments made to employees of the Borrower Parties and their respective
Subsidiaries have not been in violation of the Fair Labor Standards Act, the
Employment Standards Act, or any other applicable federal, state, provincial,
local or foreign law dealing with such matters, except where such violation,
either individually or in the aggregate, could not reasonably be expected to
have a Material Adverse Effect. All payments due from any Borrower Party or any
Subsidiary thereof, or for which any claim may be made against any Borrower
Party or any Subsidiary thereof, 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 such Borrower Party or such Subsidiary, except where the failure
to do the same, either individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect. The consummation of the transactions
contemplated hereby 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 any Borrower Party or any Subsidiary thereof is bound.
Section 4.17    Solvency. Immediately following the making of each Advance and
after giving effect to the application of the proceeds of each Advance, (a) the
fair value of the assets of each Borrower Party will exceed its Debts; (b) the
present fair saleable value of the property of each Borrower Party will be
greater than the amount that will be required to pay the probable liability of
its Debts, as such Debts and other liabilities become absolute and matured; (c)
each Borrower Party will be able to pay its Debts as such Debts become absolute
and matured; and (d) no Borrower Party will have unreasonably small capital with
which to conduct the business in which it is engaged as such business is now
conducted and is proposed to be conducted following the Closing Date.
Section 4.18    Margin Regulations. None of the Borrower Parties is engaged and
will engage, principally or as one of its important activities, in the business
of purchasing or carrying margin stock (within the meaning of Regulation U), or
extending credit for the purpose of purchasing or carrying margin stock.

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No part of the proceeds of any Advance will be used, whether directly or
indirectly, and whether immediately, incidentally or ultimately, to purchase or
carry any margin stock (within the meaning of Regulation U) or to refinance any
Debt originally incurred for such purpose, or for any other purpose that entails
a violation of, or that is inconsistent with, the provisions of the Regulations
of the Board, including Regulation T, U and X..
Section 4.19    Investment Company. None of the Borrower Parties, any Person
controlling the Borrower Parties, or any Subsidiary thereof is or is required to
be registered as an “investment company” under the Investment Company Act of
1940.
Section 4.20    OFAC Restrictions. No Borrower Party, nor Subsidiary of a
Borrower Party, (a) appear on the OFAC SDN List; (b) are included in, owned by,
controlled by, acting for or on behalf of, providing assistance, support,
sponsorship, or services of any kind to, or otherwise associated with any of the
persons or entities referred to or described in the OFAC SDN List; or (c) have
conducted business with or engaged in any transaction with any person or entity
named on any of the OFAC SDN List or any person or entity included in, owned by,
controlled by, acting for or on behalf of, providing assistance, support,
sponsorship, or services of any kind to, or otherwise associated with any of the
persons or entities referred to or described in the OFAC SDN List.
ARTICLE V    
AFFIRMATIVE COVENANTS
Until the Termination Date, each Borrower shall, and shall cause each of its
Subsidiaries and any other Borrower Party to:
Section 5.01    Preservation of Existence. Except as permitted by Section 6.03,
(a) preserve, renew and maintain in full force and effect its legal existence
and good standing under the Legal Requirements of the jurisdiction of its
formation, (b) take all reasonable action to obtain, preserve, renew, extend,
maintain and keep in full force and effect all rights, privileges, permits,
licenses, authorizations, privileges, patents, copyrights, trademarks, trade
names and franchises necessary to the conduct of its business, except for any
such actions which, if not taken, could not reasonably be expected, individually
or in the aggregate, to have a Material Adverse Effect and (c) qualify and
remain qualified as a foreign entity in each jurisdiction in which qualification
is necessary in view of its business and operations or the ownership of its
Properties to the extent the failure to qualify could reasonably be expected to
have a Material Adverse Effect.
Section 5.02    Compliance with Laws. Except as expressly permitted by any
applicable Governmental Authority, comply with all material Legal Requirements
(including, without limitation, applicable Environmental Laws and ERISA)
applicable to it or to its business or property except in such instances in
which such Legal Requirement is being contested in good faith by appropriate
proceedings or where the failure to comply with such Legal Requirement would not
reasonably be expected to result in Environmental Liability or other costs or
expenses in excess of $5,000,000.
Section 5.03    Maintenance of Property. (a) Maintain and preserve all Property
material to the conduct of its business and keep such Property in good repair,
working order and condition, (b) 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, and (c) use the
standard of care typical in the industry in the operation and maintenance of its
facilities. The Property of each Borrower Party at all times shall be maintained
in accordance with the

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requirements of all insurance carriers which provide insurance with respect to
the Property of such Borrower Party so that such insurance shall remain in full
force and effect.
Section 5.04    Maintenance of Insurance.
(h)    Maintain with insurance companies not Affiliates of any Borrower Party or
their respective Subsidiaries, insurance with respect to its Properties and
business of such types and in such amounts as are set forth in Schedule 4.12.
Such insurance companies shall, to the knowledge of the Borrower Parties, be
financially sound and reputable and have Best ratings at least as good as those
reflected on Schedule 4.12. Unless a Borrower provides Lender with appropriate
evidence of the insurance coverage required by this Agreement, the
Administrative Agent or the Collateral Agent may upon five (5) Business Days’
prior written notice to the Borrowers purchase insurance at Borrowers’ expense
to protect such agent’s and the Lenders interests in the Collateral and to
maintain the insurance required by this Agreement. This insurance may, but need
not, protect Borrower Parties’ interests. The coverage purchased by such agent
may not pay any claim made by a Borrower Party or any claim that is made against
a Borrower Party in connection with a Borrower Party’s Property or any required
insurance policy.
(i)    (i) Cause all such policies covering any Collateral to be endorsed or
otherwise amended to include a customary lender's loss payable and mortgagee
endorsement in favor of the Collateral Agent; (ii) cause all such policies
covering liability to be endorsed or otherwise amended to include a customary
loss payee or additional insured endorsement in favor of the Secured Parties;
(iii) deliver copies of insurance certificates to the Collateral Agent as of the
Closing Date; cause each such policy to provide that it shall not be canceled,
modified or not renewed upon not less than 30 days' (10 days' for non-payment of
premium) prior written notice thereof by the insurer to the Collateral Agent;
and (iv) deliver to the Collateral Agent, prior to the cancellation,
modification or nonrenewal of any such policy of insurance, a copy of an
insurance certificate evidencing such renewal or replacement policy (or other
evidence of renewal of a policy previously delivered to the Collateral Agent)
together with evidence reasonably satisfactory to the Collateral Agent of
payment of the premium therefor and insurance certificates and endorsements for
such renewal or replacement policy, meeting the requirements above.
Section 5.05    Payment of Taxes, Etc. Pay and discharge as the same shall
become due and payable all of its obligations and liabilities in accordance with
their terms, including (a) all taxes, assessments and governmental charges or
levies imposed upon it or upon its income or profits or in respect of its
Property, unless the same are being Properly Contested, (b) all lawful claims
which, if unpaid, might by law become a Lien upon its Property, and (c) all
Debt, as and when due and payable, but subject to any subordination provisions
contained in any instrument or agreement evidencing such Debt.
Section 5.06    Reporting Requirements. Deliver to the Administrative Agent and
each Lender, in form and detail reasonably satisfactory to the Administrative
Agent and the Required Lenders:
(g)    Annual Financials. Not later than 90 days after the end of each Fiscal
Year of Horsehead Holding, the audited consolidated balance sheet and related
statements of operations, statements of income, members’ or shareholders' equity
and cash flows of the Horsehead Holding and its Subsidiaries with consolidating
schedules (the “Annual Financials”) as of the end of and for such year, setting
forth in each case in comparative form the figures for the previous Fiscal

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Year, all reported on by the Independent Auditor with a statement to the effect
that such consolidated financial statements present fairly in all material
respects the financial condition and results of operations of Horsehead Holding
and its consolidated Subsidiaries on a consolidated basis in accordance with
GAAP consistently applied;
(h)    Monthly Financials. As soon as available and in any event not later than
15 days after the end of each month of each Fiscal Year of Horsehead Holding (A)
the consolidated and consolidating balance sheets of Horsehead Holding and its
Subsidiaries as at the end of such month and (B) the consolidated balance sheet
of Horsehead Holding and its Subsidiaries as at the end of such month, in each
case with the related statements of income or operations and members’ or
shareholders' equity for such month and for the portion of such Fiscal Year then
ended, setting forth in comparative form for each fiscal month beginning with
the first month following the Closing Date, the figures for the corresponding
month of the previous Fiscal Year and the corresponding portion of the previous
Fiscal Year, all in reasonable detail and certified by a Responsible Officer of
the Borrowers as fairly presenting in all material respects the financial
condition, results of operations and shareholders' equity of the Borrower
Parties and their consolidated Subsidiaries on a consolidated and consolidating
basis in accordance with GAAP consistently applied;
(i)    Compliance Certificates. (i) Concurrently with the delivery of the
financial statements referred to in Sections 5.06(a), and (b), a duly completed
Compliance Certificate signed by a Responsible Officer of Borrower, setting
forth the calculations used to demonstrate compliance with the financial
covenants set forth in Section 6.20 and stating whether any change in GAAP or in
the application thereof, as it applies to the Borrower Parties, has occurred
and, if any such change has occurred, specifying the effect of such change on
the financial statements accompanying such certificate (it being understood that
the Borrowers shall demonstrate such compliance using the actual financials
referred to in Sections 5.06(a), (b) and (c));
(j)    Weekly Borrowing Base Certificates. On or prior to 5:00pm Eastern
Standard Time on Wednesday following each calendar week (such week being the
“Reported Week”), a Borrowing Base Certificate computed as of the last Business
Day of such Reported Week (other than with respect to the INMETCO Projected
Gross Margin and the cost based inventory portions of such calculation, which
will only be updated on a monthly basis), in each case signed by a Responsible
Officer of a Borrower together with supporting information in a format
reasonably acceptable to the Administrative Agent as follows:
(i)    a detailed calculation of the Borrowing Base;
(ii)    a schedule of Account Debtors of the Borrower Parties indicating which
Account Debtors are investment grade, with separate columns broken down
separately for Eligible Receivables and non-Eligible Receivables showing (A) the
owner of such Receivable, (B) the gross receivables per Account Debtor; less the
reduction of Accounts due to: (i) accounts payables which can be set-off; (ii)
accounts that are Past Due; and (iii) all other amounts that should be set-off,
including financial trading exposures that can be set-off; (C) with column
showing the net obligation of each individual Account Debtor; and (D) the credit
limits applicable to each Account Debtor, or as otherwise required by the
Administrative Agent from time to time;
(iii)    a schedule detailing the Inventory of the Borrower Parties broken down
separately for Eligible Inventory and non-Eligible Inventory and showing (A) the
owner of such Inventory,

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(B) the location, (C) product type and quality, (D) volume on hand, and (E)
Market Value,; provided that the location, product type and volume information
set forth on such schedule shall be verified in a written record from the
relevant third party facility operator or inventory holder (as the case may be)
to any Borrower and forwarded by such Borrower to the Administrative Agent;
(iv)    the INMETCO Projected Gross Margin and the actual INMETCO Gross Margin
achieved for the last twelve (12) month period;
(v)    copies of all deposit, security, commodity and futures broker account
statements showing available cash;
(vi)    a position report and a marked to market report; and
(vii)    any additional reports with respect to the Borrowing Base as the
Administrative Agent may reasonably request;
(k)    USA Patriot Act and Anti-Money Laundering laws. Promptly, following a
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 Laws;
(l)    Periodic Reports. Promptly after the same become available, copies of all
periodic reports distributed by Horsehead Holding to any national securities
exchange, as applicable;
(m)    Other Information. Such other information respecting the business or
Properties, or the condition or operations, financial or otherwise, of the
Borrower Parties and their respective Subsidiaries as the Administrative Agent
or any Lender may from time to time reasonably request.
Section 5.07    Other Notices. Deliver to the Administrative Agent and each
Lender prompt written notice of the following:
(a)    Defaults. The occurrence of any Default or Event of Default;
(b)    Litigation. The filing or commencement of, or any threat or notice of
intention of any person to file or commence, any action, suit or proceeding,
whether at law or in equity or by or before any Governmental Authority, against
any Borrower Party or any Subsidiary or Affiliate thereof that could reasonably
be expected to result in liability of any Borrower Party or any Subsidiary
thereof in an aggregate amount exceeding $500,000;
(c)    ERISA Events. The occurrence of any ERISA Event that, alone or together
with any other ERISA Events that have occurred, could reasonably be expected to
result in liability of any Borrower Party in an aggregate amount exceeding
$500,000;
(d)    Environmental Notices. (i) any Environmental Liability that could
reasonably be expected to exceed $5,000,000, and (ii) a copy of any form of
notice, summons or citation received from any Governmental Authority or any
other Person, concerning (A) material

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violations or alleged violations of Environmental Laws, which seeks to impose
material Environmental Liabilities therefor, (B) any notice of potential
responsibility under any Environmental Law which could reasonably be expected to
result in Environmental Liabilities in excess of $5,000,000, or (C) the filing
of a Lien other than a Permitted Lien upon, against or in connection with any
Borrower Party or any of its Subsidiaries, or any of their leased or owned
material Property, wherever located, due to a violation or alleged violation of
an Environmental Law;
(e)    Collateral. Furnish to the Administrative Agent and each Lender, (i) not
less than 5 Business Days prior to any such event, written notice of (A) any
change in any Borrower Party's corporate name, (B) any change in any Borrower
Party's identity, corporate structure or jurisdiction of formation, and (C) any
change in any Borrower Party's Federal Taxpayer Identification Number or
organizational identification number, and (ii) within 5 Business Days of
occurrence of any such event, written notice of (A) any loss, damage, or
destruction to the Collateral in the amount of $2,500,000 or more, not covered
by insurance, and (B) any and all default notices received under or with respect
to any leased location or public warehouse where Collateral is located;
(f)    Material Changes. Any development that has resulted in, or could
reasonably be expected to result in, a Material Adverse Effect;
(g)    Debt. The incurrence of any Debt, other than Debt permitted under this
Agreement;
(h)    Material Adverse Effect. Any other development that results in, or could
reasonably be expected to result in, a Material Adverse Effect;
(i)    Governmental Disputes. Any material dispute that arises between any
Borrower Party or an Affiliate and any Governmental Authority;
(j)    Risk Management Policy Violations or Changes. Any material violations of
or changes to the Risk Management Policy or the entering of any fixed price
Physical Purchase Transaction in excess of one year or any fixed price Physical
Purchase Transaction for a volume in excess of 100 metric tons per month;
(k)    Permits. The revocation, suspension, forfeiture, or expiration of any
material Permit of any Borrower Party.
Each notice pursuant to this Section shall be accompanied by a statement of a
Responsible Officer setting forth details of the occurrence referred to therein
and stating what action such Person has taken and proposes to take with respect
thereto.
Section 5.08    Books and Records; Inspection. (a) Keep proper records and books
of account in which full, true and correct entries will be made in accordance
with GAAP and in material conformity with all Legal Requirements, reflecting all
financial transactions and matters involving the assets and business of the
Borrower Parties and their respective Subsidiaries; (b) maintain such books of
record and account in material conformity with all applicable requirements of
any Governmental Authority having regulatory jurisdiction over such Borrower
Party or any of its Subsidiaries, as the case may be; (c) from time to time
during regular business hours upon reasonable prior notice, permit
representatives and independent

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contractors of the Administrative Agent and each Lender (i) to visit and inspect
any of its Properties, including a collateral audit and field exam of the
Accounts, Inventory and other components comprising the Borrowing Base and
Collateral by Lenders’ independent engineer or consultant at Borrowers’ expense,
including an inspection and review of the books and records of the Borrower
Parties, a review of all proprietary trading activity, and a systems review,
including, without limitation, to assess the quality, level and risks associated
with the Collateral comprising the Borrowing Base; provided that unless an Event
of Default exists Borrower shall not have to pay for such Lenders’ independent
engineer or consultant more than once in any twelve (12) month period, (ii) to
examine its corporate, financial and operating records, and make copies thereof
or abstracts therefrom and (iii) to discuss its affairs, finances and accounts
with its directors, officers, independent public accountants, brokers,
representatives, creditors (including term lenders), counterparties to Hedge
Agreements and auditors, all at the expense of the Borrowers and at such
reasonable times during normal business hours and as often as may be reasonably
desired, upon reasonable advance notice to Borrower (provided that, during the
existence of a Default or Event of Default, no prior notice will be required);
and (d) instruct its brokers, creditors (including term lenders) and auditors to
provide information requested by Administrative Agent.
Section 5.09    Use of Proceeds. Use the proceeds of the Advances for the
Borrowers’ working capital and general corporate purposes. No part of the
proceeds of any Advance will be used, whether directly or indirectly, and
whether immediately, incidentally or ultimately, to purchase or carry any margin
stock (within the meaning of Regulation U) or to refinance any Debt originally
incurred for such purpose, or for any other purpose that entails a violation of,
or that is inconsistent with, the provisions of the Regulations of the Board,
including Regulation T, U and X.
Section 5.10    Nature of Business. Maintain and operate its business including
any business incidental thereto in substantially the manner in which it is
conducted and operated on the Closing Date.
Section 5.11    Further Assurances in General. Execute any and all further
documents, financing statements, agreements and instruments, and take all such
further actions (including the filing and recording of financing statements,
fixture filings, mortgages, deeds of trust and other documents), which may be
required under any Legal Requirement, or which the Administrative Agent,
Collateral Agent or the Required Lenders may reasonably request, all at the
expense of the Borrower Parties, including all such actions to establish,
create, preserve, protect and perfect an Acceptable Lien on and in the
Collateral in favor of the Collateral Agent for the benefit of the Secured
Parties on substantially all of the assets of each Borrower Party other than the
Excluded Assets, whether now owned or hereafter acquired. Each Borrower Party
also agrees to provide to the Collateral Agent, from time to time upon
reasonable request, evidence reasonably satisfactory to the Collateral Agent as
to the perfection and priority of the Liens created or intended to be created by
the Security Documents. No Borrower Party shall effect or permit any change
referred to in Section 5.07(e) unless all filings have been made under the
Uniform Commercial Code or otherwise that are required in order for the
Collateral Agent to continue at all times following such change to have, and
each Borrower Party agrees to take all necessary action to ensure that the
Collateral Agent does continue at all times to have, a valid, legal and
perfected security interest in all the Collateral. Each Borrower Party also
agrees promptly to notify the Administrative Agent and the Collateral Agreement
if any material portion of the Collateral is damaged or destroyed.
Notwithstanding anything to the contrary contained in any of the Credit Facility
Documents, the Borrower Parties shall not be required and the Collateral Agent
shall not be permitted to take any perfection steps with respect to Collateral
which is located outside the United States or Canada except to the extent that
such Collateral has been moved outside the United States and Canada to hinder or
prevent the exercise of remedies against such Collateral.

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Section 5.12    Cash Management. Establish deposit accounts (collectively,
“Deposit Accounts”) with such banks selected by the Borrower Parties
(collectively, the “Depository Banks”) and all invoices evidencing Accounts
payable directly to a Borrower Party shall bear a notice that such invoices are
payable to such Deposit Accounts and in which the Borrower Parties will promptly
deposit all payments made for Inventory or other payments constituting proceeds
of Collateral in the identical form in which such payment was made, whether by
cash or check. Each such Deposit Account shall be subject to an Account Control
Agreement, pursuant to which the relevant Depository Bank shall acknowledge and
agree, that the Deposit Accounts are subject to an Acceptable Lien for the
benefit of the Collateral Agent and the Secured Parties, that it will comply
with any instructions originated by the Collateral Agent directing the
disposition of the funds in the respective Deposit Accounts maintained by any
Borrower Party with such Depository Bank without further consent of such
Borrower Party, and unless otherwise agreed by the Collateral Agent, that
Depository Bank has no right to setoff against the Deposit Accounts, other than
for customary charges of the Depository Bank for depositary services, for
returned checks, and for other obligations agreed to by the Collateral Agent. If
any Borrower Party shall receive any monies, checks, notes, drafts or any other
payments relating to and/or proceeds of Accounts or other Collateral, such
Person shall hold such instrument or funds in trust for the Collateral Agent,
and, immediately upon receipt thereof, shall remit the same or cause the same to
be remitted, in kind, to the Deposit Accounts or to the account of the
Collateral Agent.
Section 5.13    Risk Management Policy. Comply in all material respects with the
Risk Management Policy.
Section 5.14    Collateral.
(a)    Maintenance of Collateral. Continuously maintain the Mortgaged Properties
and other material Collateral in good working condition (ordinary wear and tear
excepted) and in accordance in all material respects with customary industry
standards considering the business needs of the Borrower Parties from time to
time.
(b)    Location of Collateral. Except for Inventories not included in the
Borrowing Base, keep all Inventory not in transit only in the United States and
Canada at location(s) for which the Collateral Agent has an Acceptable Lien on
such Inventory.
(c)    Collateral Records. Use commercially reasonable efforts to maintain
accurate and complete records of the Collateral (including, to the extent such
information is reasonably available, its description, location, age, condition,
cost and accumulated depreciation) used in connection with the conduct of
Borrower’s business or the operation of Borrower’s Property.
(d)    Sale or Disposal of Collateral. When Borrower is permitted to dispose of
any Collateral under the Security Documents, it shall do so in good faith in the
Ordinary Course of Business, as permitted by the provisions of the Credit
Agreement; provided that when a disposition of Collateral is permitted under the
Credit Agreement, it shall automatically be permitted under each such Security
Document notwithstanding anything to the contrary in any such Security Document
except to the extent the terms of the Intercreditor Agreement – 2015 prohibit
such disposition.
(e)    CAA. Borrowers on behalf of themselves and the other Borrower Parties
hereby acknowledge and agree to the terms of the CAA.
Section 5.15    Compliance with Anti-Money Laundering and OFAC Laws.

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(a)    comply at all times with the requirements of all Anti-Money Laundering
Laws;
(b)    provide each Lender any information regarding any Borrower Party, its
Affiliates, and its Subsidiaries necessary for such Lender to comply with all
Anti-Money Laundering Laws;
(c)    comply at all times with the requirements of all OFAC Laws;
(d)    not, and shall cause its Subsidiaries not to, conduct business with or
engage in any transaction with any person or entity that is (i) named in the
OFAC SDN List, or (ii) included in, owned by, controlled by, acting for or on
behalf of, providing assistance, support, sponsorship, or services of any kind
to, or otherwise associated with any of the persons or entities referred to or
described in the OFAC SDN List;
(e)    if it obtains knowledge or receives any written notice that any Borrower
Party or Subsidiary is named on the OFAC SDN List (such occurrence, an “OFAC
Violation”), immediately (i) give written notice to the Administrative Agent and
each Lender of such OFAC Violation, and (ii) comply with all applicable laws
with respect to such OFAC Violation (regardless of whether the party included on
the OFAC SDN List is located within the jurisdiction of the United States of
America), including the OFAC Laws, and the Borrowers hereby authorize and
consent to the Administrative Agent and each Lender's taking any and all steps
the Administrative Agent or such Lender deems necessary, in its sole discretion,
to comply with all applicable laws with respect to any such OFAC Violation,
including the requirements of the OFAC Laws (including the “freezing” and/or
“blocking” of assets and reporting such action to OFAC); and
(f)    upon the Administrative Agent or any Lender's reasonable request from
time to time, deliver a certification confirming its compliance with the
covenants set forth in this Section 5.15.
Section 5.16    Maintenance of Liens. Subject to the last sentence of Section
5.11, cause all Collateral to be subject at all times to an Acceptable Lien in
favor of the Collateral Agent. If a Borrower Party acquires additional Property
after the Closing Date, it shall promptly notify the Collateral Agent of the
acquisition and execute and deliver amendments to the Security Documents or new
Security Documents as requested by the Collateral Agent to grant to the
Collateral Agent, an Acceptable Lien over that additional Property.
Section 5.17    Creditors. A Borrower shall notify the Administrative Agent
promptly if any Borrower Party fails to make any payment (except for payments
Properly Contested) to any Person in accordance with required terms where such
non-payment would reasonably be expected to result in the imposition of a Lien
on any material portion of the Collateral (other than a Permitted Encumbrance)
or could reasonably be expected to have a Material Adverse Effect. If the
Administrative Agent receives notice that Borrower has failed to make any
required payment when due, the Administrative Agent may, but will have no
obligation to, make payment directly to the creditor if necessary, in the
opinion of the Administrative Agent, to protect the Collateral or the Collateral
Agent’s interest in the Collateral. If the Administrative Agent makes payments
to any creditor under this Section 5.17, Borrower shall reimburse the
Administrative Agent upon demand and, if not promptly reimbursed, those amounts
will become part of the Credit Facility Obligations and will be secured by the
Collateral Agent’s Liens on the Collateral.

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Section 5.18    Commodity Exchange Act Keepwell Provisions. Each Qualified ECP
Guarantor hereby guarantees the payment and performance of all Obligations of
each Borrower Party (other than itself) and absolutely, unconditionally and
irrevocably undertakes to provide such funds or other support as may be needed
from time to time by any other Borrower Party that is not a Qualified ECP
Guarantor in order for such other Borrower Party to honor its Obligations
(provided, however, that each Qualified ECP Guarantor shall only be liable under
this Section 5.18 for the maximum amount of such liability that can be hereby
incurred without rendering its obligations under this Section 5.18, or otherwise
under this Agreement or any Document executed or delivered in connection with
the Obligations voidable under applicable law relating to fraudulent conveyance
or fraudulent transfer, and not for any greater amount). The obligations of each
Qualified ECP Guarantor under this Section 5.18 shall remain in full force and
effect until the Termination Date. Each Qualified ECP Guarantor intends that
this Section 5.18 constitute, and this Section 5.18 shall be deemed to
constitute, a “keepwell, support, or other agreement” for the benefit of each
other Borrower Party that is not a Qualified ECP Guarantor for all purposes of
Section 1a(18)(A)(v)(II) of the Commodity Exchange Act. The provisions of this
Section 5.18 shall supercede and control over any contrary provision of the
Guaranty.”

ARTICLE VI    
NEGATIVE COVENANTS
Until the Termination Date, no Borrower Party shall, and shall not permit any of
its Subsidiaries to:
Section 6.01    Liens, Etc. Create, assume, incur or suffer to exist, any Lien
on or in respect of any of its Property whether now owned or hereafter acquired,
or assign or sell any income or revenues (including accounts receivable) or
rights in respect thereof, other than the following (“Permitted Liens”):
(c)    Liens created pursuant to any Credit Facility Document;
(d)    Permitted Encumbrances; and
(e)    Liens securing Capital Leases permitted by Section 6.02(d).
Section 6.02    Debts, Guaranties and Other Obligations. Create, assume, suffer
to exist or in any manner become or be liable, in respect of any Debt except:
(d)    Obligations;
(e)    Debt outstanding on the date hereof and listed on Schedule 6.02(b)
excluding the ABL Facility and Wells Fargo credit agreement listed on Schedule
6.02(b) and any refinancings, refundings, renewals or extensions thereof;
provided that the amount of such Debt is not increased at the time of such
refinancing, refunding, renewal or extension except by an amount equal to a
reasonable premium or other reasonable amount paid, and fees and expenses
reasonably incurred, in connection with such refinancing (which may include a
premium required for a private or public tender offer for some or all of such
outstanding debt instruments, and underwriting fees and attorneys’ fees and
expenses and other related costs incurred in connection therewith); and by an
amount equal to any existing commitments unutilized thereunder and the direct or
any contingent obligor with respect thereto is not changed (provided that such
obligor is still in existence), as a result of or in connection with such
refinancing, refunding, renewal or extension; provided that with respect to the
refinancing of the Debt issued under the 2012

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Indenture the resulting aggregate Debt issued in connection with such
refinancing shall not exceed $230,000,000; and provided, still further, that the
terms relating to principal amount, amortization, maturity, collateral (if any)
and subordination (if any), and other material terms taken as a whole, of any
such refinancing, refunding, renewing or extending Debt, and of any agreement
entered into and of any instrument issued in connection therewith, are no less
favorable in any material respect to the Borrowers or the Lenders than the terms
of any agreement or instrument governing the Debt being refinanced, refunded,
renewed or extended and the interest rate applicable to any such refinancing,
refunding, renewing or extending Debt does not materially exceed the then
applicable market interest rate;
(f)    Debt in respect of the Hedge Agreements which either (i) are with a
Lender or its Affiliate or (ii) are not prohibited under Section 6.14 and do not
exceed $15,000,000 in the aggregate;
(g)    Capital Leases that do not exceed $2,000,000 in the aggregate;
(h)    Debt in respect of letters of credit and reimbursement obligations in
connection therewith at any time outstanding that do not exceed $20,000,000 in
the aggregate and for which not more than $10,000,000 in the aggregate is not
cash collateralized;
(i)    Debt secured by Non-Material Real Property, not to exceed $5,000,000 in
aggregate at any time outstanding;
(j)    Debt arising from the honoring by a bank or other financial institution
of a check, draft or similar instrument drawn against insufficient funds in the
ordinary course of business or other cash management services in the ordinary
course of business;
(k)    Guarantees of any Borrower Party in respect of Debt otherwise permitted
hereunder;
(l)    Debt in respect of purchase money obligations for fixed or capital assets
which are not incurred in connection with Capital Expenditures which are
reasonably likely to cause a violation of Section 6.05;
(m)    Debt in respect of insurance premium financing for insurance being
acquired by any Borrower Party or any Subsidiary under customary terms and
conditions;
(n)    Debt incurred in the Ordinary Course Of Business in connection with
employee credit card and expense reimbursement programs;
(o)    Debt arising as a direct result of judgments, orders, awards or decrees
against any Borrower Party, in each case not constituting an Event of Default;
(p)    to the extent any such items constitute Debt, Debt arising from
agreements providing for indemnification, contribution, adjustment of purchase
price or similar obligations, in each case incurred or assumed in connection
with any acquisition or disposition otherwise permitted under this Agreement;
(q)    Permitted Additional Unsecured Debt; and

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(r)    Debt otherwise not permitted hereunder, in a total aggregate amount of
$500,000.
Section 6.03    Merger or Consolidation. Merge, amalgamate, dissolve, liquidate
or consolidate with or into another Person, or Dispose of (whether in one
transaction or in a series of transactions) all or substantially all of the
consolidated assets of any Borrower Party (whether now owned or hereafter
acquired) to or in favor of any Person, except that, so long as no Default
exists or would result therefrom:
(j)    any Borrower Party (other than a Borrower) may merge or amalgamate with
another Borrower Party;
(k)    any Subsidiary of a Borrower may effect Asset Dispositions of all or
substantially all of its assets (upon voluntary liquidation or otherwise) to a
Borrower Party; and
(l)    a Borrower Party that is not a Borrower may merge or amalgamate with
another Person; provided that (i) such Borrower Party is the surviving Person,
(ii) such transaction will not result in a Change of Control, (iii) the other
Person is in the same line of business as the Borrower Parties, and (iv) the
transaction will not and is not reasonably likely to result in a Default or
Event of Default.
Section 6.04    Asset Sales. Make any Asset Disposition or enter into any
agreement to make any Asset Disposition, except:
(e)    Asset Dispositions used, obsolete, worn out or surplus equipment or
property in the Ordinary Course of Business; and
(f)    sales of Inventory in the Ordinary Course of Business;
(g)    Asset Dispositions by one Borrower Party (except INMETCO) to another
Borrower Party;
(h)    Asset Dispositions resulting from any casualty or other insured damage
to, or any taking under power of eminent domain or by condemnation or similar
proceeding of, any property or asset of any Borrower Party
(i)    Ordinary Course of Business dispositions of (i) inventory (or other
similar transactions having substantially the same economic effect); (ii) cash
equivalents; (iii) overdue accounts receivable in connection with the compromise
or collection thereof; and (iv) leases, subleases, rights of way, easements,
licenses, and sublicenses being sold in the Ordinary Course of Business that,
individually and in the aggregate, do not materially interfere with the ordinary
conduct of the business of the Borrower Parties and do not materially detract
from the value or the use of the property which they affect;
(j)     dispositions with respect to sales or transfers of accounts which are
not Borrowing Base Collateral;
(k)    other dispositions of assets not in the Ordinary Course of Business in an
amount not exceeding $2,000,000.00 in the aggregate in any fiscal year of the
Borrower Parties and provided that, in the case of any assets constituting
Borrowing Base Collateral that are disposed

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of pursuant to this clause (g), all proceeds of such disposition shall be in
cash and shall have been paid directly by the Person acquiring such assets into
a Deposit Account subject to an Account Control Agreement;
(l)    dispositions of equipment to the extent that (i) such property is
exchanged for credit against the purchase price of similar replacement property
or (ii) the proceeds of such disposition are reasonably promptly applied to the
purchase price of such replacement property;
(m)    dispositions of assets of any Borrower Party other than Mortgaged
Properties that (i) are ineligible for inclusion in the Borrowing Base, (ii)
satisfy eligibility criteria for the Borrowing Base, but has not previously been
included in the Borrowing Base Certificate delivered by such Borrower, or (iii)
satisfy eligibility criteria for the Borrowing Base and have previously been
included in the Borrowing Base Certificate of such Borrower, if in case of
dispositions described in clause (iii), (A) such Borrower Party notifies the
Administrative Agent not less than five Business Days prior to such disposition
of the details of such disposition and (B) all net proceeds of such disposition
shall have been paid directly into a Deposit Account subject to an Account
Control Agreement; and
(n)    dispositions of Excluded Assets.
Section 6.05    Capital Expenditures and Investments. If at the end of any
calendar month the cash and Cash Equivalents of the Borrower Parties shall in
the aggregate be less than $25,000,000, make or become legally obligated to make
without the prior written consent of the Administrative Agent Unauthorized
Capital Expenditures in excess of $5,000,000 in the aggregate until such time at
as either (a) the cash and Cash Equivalents of the Borrower Parties shall in the
aggregate exceed $35,000,000 as shown in the Borrower’s weekly  Borrowing Base
Certificate for four consecutive weeks, or (b) the Borrowing Parties and the
Administrative Agent shall have agreed on a new limitation after reviewing the
Borrowing Parties’ Capital Expenditures projections and milestones, and
financials.  To the extent that the Borrower Parties shall satisfy the condition
precedent to be relieved from the $5,000,000 limit, but the Borrower Parties
shall again fail the $25,000,000 test, the Borrower Parties will again be
subject to the Capital Expenditures limitation.
As used in this Agreement, the term “Unauthorized Capital Expenditures” shall
mean Capital Expenditures for any purpose other than (a) non-discretionary
repairs or maintenance needed to keep the Borrowers’ facilities operating
normally, or that must be made at that time and in such an amount as would be
necessary to comply with Environmental Laws or to protect the health and safety
of individuals at such facilities or (b) Capital Expenditures for repair or
replacement of facilities for which insurance proceeds are reasonably expected
to be made available to pay for such Capital Expenditures. Concurrently with the
delivery of each Borrowing Base Certificate while the restrictions of the first
paragraph of this Section 6.05 are in effect, the Borrowers shall itemize and
describe in reasonable detail each Capital Expenditure during such prior weekly
period described in the previous clauses (a) and (b).
Make or suffer to exist any Investments, or commitments therefor, except:
(n)    Investments held by any Borrower Party or any of its Subsidiaries in
deposit, securities, commodities or futures broker accounts that (i) in the case
of any account maintained by a Borrower Party, are subject to Account Control
Agreements that create and perfect an Acceptable Lien therein in favor of
Administrative Agent and (ii) in the case of any account maintained by a
Subsidiary which is not a Borrower Party, comply with Section 6.16;

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(o)    so long as no Event of Default exists at the time they are made or would
result therefrom, advances to officers, directors and employees of any Borrower
Party in the Ordinary Course of Business consistent with past practices for
travel and entertainment expenses, relocation costs and similar purposes in an
aggregate amount not to exceed $200,000 outstanding at any time;
(p)    so long as no Event of Default then exists or would result therefrom, the
acquisition or creation of a Subsidiary in compliance with Section 6.15; and
(q)    Investments in Cash Equivalents
(r)    extensions of trade credit in the ordinary course of business (including,
for the avoidance of doubt, ordinary course extensions of credit under commodity
contracts and Hedge Agreements);
(s)    Investments by any Borrower Party in any other Borrower Party or any
Subsidiary of any Borrower Party which do not in the aggregate exceed $2,000,000
for a non-Borrower;
(t)    Investments consisting of cash and cash equivalents posted as collateral
to satisfy margin requirements with counterparties of contracts or Hedge
Agreements of any Borrower Party;
(u)    Investments (including debt obligations and equity securities) received
in connection with the bankruptcy, insolvency, arrangement or reorganization of
suppliers and customers and in settlement of delinquent obligations of, and
other disputes with, customer and suppliers arising in the ordinary course of
business;
(v)    Investments in existence on the Closing Date and listed on Schedule 6.05,
together with any renewals and extensions thereof so long as the principal
amount of such renewal or extension does not exceed the original principal
amount of such Investment;
(w)    Investments in promissory notes and other evidence of Debt received as
consideration for any asset sale, such Investments not to exceed $1,000,000 in
the aggregate at any one time outstanding;
(x)     Investments consisting of Guarantees permitted by Section 6.02;
(y)    Investments consisting of debt securities as partial consideration for
the disposition of assets to the extent permitted by Section 6.04;
(z)    Investments to the extent that payment for such Investments is made
solely with equity interests of any Borrower Party to the extent such
transaction would not result in a Change of Control; and
(aa)    Investments to the extent constituting the reinvestment of proceeds
arising from any permitted asset sale or proceeds of insurance to repair,
replace or restore any property in respect of which such proceeds were paid or
to reinvest in other properties or assets that are used or are otherwise useful
in the business of any Borrower Party.

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Section 6.06    Restricted Payments. Declare or make, directly or indirectly,
any Restricted Payment, or incur any obligation (contingent or otherwise) to do
so, except that so long as no Default exists or would result therefrom, any
Borrower Party may make Restricted Payments to any other Borrower Party except.
(l)    Restricted Payments between or to Borrowers; and
(m)    Restricted Payments to Horsehead Holding for payments of or for (i) debt
service by Horsehead Holding on Debt permitted under this Agreement, (ii) taxes,
and SEC and corporate filing or registration fees of Horsehead Holding, and
(iii) accounting, legal, director fees and expenses, director advisory services
fees and expenses, and other general administrative expenses of Horsehead
Holding not to exceed $2,000,000 per calendar year.
Section 6.07    Change in Nature of Business. Engage in any line of business
substantially different from those lines of business conducted by the Borrower
Parties on the date hereof or any business substantially related or incidental
thereto.
Section 6.08    Transactions With Affiliates. Enter into any transaction of any
kind with any Affiliate of any Borrower Party, whether or not in the Ordinary
Course of Business, other than (a) on fair and reasonable terms substantially as
favorable to such Borrower Party as would be obtainable by such Borrower Party
at the time in a comparable arm's length transaction with a Person other than an
Affiliate, including (i) agreements with owners, directors and officers of any
Borrower Party or any Affiliate of any Borrower Party for services to any Loan
Party for fair and reasonable compensation, (ii) the payment by any Borrower
Party of reasonable customary expenses of such owners, directors and officers,
(b) as disclosed to the Administrative Agent on Schedule 6.05 hereto, and (c)
the payment of Restricted Payments made in accordance with Section 6.06.
Section 6.09    Agreements Restricting Liens and Distributions. Create or
otherwise cause or suffer to exist any prohibition, encumbrance or restriction
which prohibits or otherwise restricts the ability (a) of any Subsidiary of any
Borrower Party to make Restricted Payments to any Borrower Party or to otherwise
transfer property to such Borrower Party, (b) of any Borrower Party to Guarantee
the Obligations of the Borrowers or (c) of any Borrower Party to create, incur,
assume or suffer to exist Liens on property of such Person.
Section 6.10    Limitation on Accounting Changes or Changes in Fiscal Periods.
Permit (a) any change in any of its accounting policies affecting the
presentation of financial statements or reporting practices, except as required
or permitted by GAAP or (b) the fiscal year of any Borrower Party to end on a
day other than December 31 or change any such entity's method of determining
fiscal quarters.
Section 6.11    Sale and Leaseback Transactions. Enter into or suffer to exist
any Sale and Leaseback Transactions.
Section 6.12    Other Debt. Permit any waiver, supplement, modification,
amendment, termination or release of any indenture, instrument or agreement
pursuant to which any of its Debt for borrowed money (other than Debt evidenced
by other Credit Facility Documents) is outstanding if such waiver, supplement,
modification, amendment, termination or release would (i) increase the maximum
principal amount of such Debt except as expressly provided in Section 6.02, or
the ordinary interest rate or the default interest rate on such Debt; (ii)
change the dates upon which payments of principal or interest are due on such
Debt; (iii) change any event of default or change or add any covenant with
respect to such Debt; (iv) change the payment,

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redemption or prepayment provisions of such Debt; or (v) change or amend any
other term if such change or amendment would materially increase the obligations
of the obligor or confer additional material rights on the holder of such Debt
in a manner adverse to any Borrower Party or any Secured Party.
Section 6.13    Legal Status; Amendment of Organizational Documents. (a) Change
its jurisdiction of organization, (b) take or permit any action that would
result in a Borrower Party’s discontinuance as a corporation or limited
liability company in good standing under the jurisdiction of such Borrower
Party’s organization, or (c) amend, modify or supplement any articles or
certificate of incorporation or formation, bylaws or limited liability company
agreement or any other agreement, instrument or document affecting any Borrower
Party's organization, management or governance without the consent of the
Administrative Agent except if (i) such amendment, modification or supplement
does not adversely affect the rights or interests of the Administrative Agent,
the Collateral Agent or the Lenders under the Credit Facility Documents, and
(ii) any Borrower gives the Administrative Agent prior written notice of any
such amendment, modification or supplement.
Section 6.14    Trading Limitations. Create, incur, assume or permit to exist
any obligation under any Hedge Agreement, except those agreements and
transactions entered into in the Borrower Parties’ Ordinary Course of Business
to hedge or mitigate risks to which the Borrower Parties have actual exposure
and not for any speculative purposes or that violate the Risk Management Policy
which are with counterparties that have an investment grade rating.
Section 6.01    Additional Subsidiaries. Create or acquire any additional
Subsidiaries without (a) giving 5 days’ prior written notice to (and, if such
additional Subsidiary is not incorporated or otherwise formed under the laws of
the United States of America or any state thereof, prior written approval of the
Administrative Agent), (b) the equity holder of such Subsidiary executing and
delivering to the Administrative Agent a Pledge Agreement (or supplement to
Pledge Agreement) pledging 100% of the Equity Interests owned by such equity
holder along with the certificates pledged thereby, if any, and appropriately
executed stock powers in blank, if applicable, (c) such new Subsidiary executing
and delivering to the Administrative Agent a Guaranty, Pledge Agreement, and a
Security Agreement, and such other Security Documents as the Administrative
Agent may reasonably request, and (d) the delivery by such Subsidiary and the
applicable Borrower Party any certificates, opinions of counsel, title opinions
or other documents as the Administrative Agent may reasonably request relating
to such Subsidiary, in each case, prior to or simultaneously with the creation
of such Subsidiary.
Section 6.02    Accounts. Subject to Section 5.16, each Borrower Party
(excluding Horsehead Holding) shall not, and shall not permit any of its
Subsidiaries to deposit or maintain funds, investment property or commodities
contracts in any deposit, security, commodities or futures broker account,
unless such account is (a) in connection with a Hedge Agreement not prohibited
by this Agreement or (b) is otherwise subject to an Account Control Agreement
that creates or perfects an Acceptable Lien in such account.
Section 6.03    Intentionally Omitted.
Section 6.04    Information. No Borrower Party shall permit any information,
reports, financial statements, exhibits and schedules furnished by or on behalf
of any Borrower Party to the Administrative Agent, the Collateral Agent and the
Lenders in connection with the negotiation of any Credit Facility Document or
included therein or delivered pursuant thereto (taken as a whole) to contain any
material misstatement of fact or omit to state any material fact necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, provided, that with respect to any projected

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information (including any projected financial information), no Borrower Party
shall permit such information to be prepared other than in good faith based upon
assumptions believed to be reasonable at the time.
Section 6.05    Intentionally Omitted.
Section 6.06    Financial Covenants.
(n)    Minimum Net Working Capital. Permit (i) Net Working Capital to be less
than Ten Million Dollars ($10,000,000) at any time or (ii) Borrowers Net Working
Capital to be less than Ten Million Dollars ($10,000,000) at any time.
(o)    Minimum Consolidated Tangible Net Worth. Permit the Tangible Net Worth to
be less than Four Hundred Million Dollars ($400,000,000) at any time.
(p)    EBITDA. Permit for any Rolling Period the Adjusted EBITDA to be less than
Twenty One Million Dollars ($21,000,000), commencing with the Rolling Period
ending on the last day of the month following the 1st anniversary of the Closing
Date.
(q)    Availability. Permit Availability to be less than or equal to zero at any
time.
Section 6.07    Post-Closing Obligations. Failure to provide:
(a)    Bank Agreements. Within 15 days of the Closing Date, to the
Administrative Agent and each Lender evidence reasonably satisfactory to it
that:
(i)    Any PNC Bank accounts have been closed or are subject to an Account
Control Agreement pursuant to which the Collateral Agent has an Acceptable Lien;
(ii)    Any Wells Fargo Bank accounts have been closed or are subject to an
Account Control Agreement pursuant to which the Collateral Agent has an
Acceptable Lien; and
(iii)    The items set forth on the closing checklist listed as post-closing
items have been satisfied.

ARTICLE VII    
EVENTS OF DEFAULT
Section 7.01    Events of Default. The occurrence of any of the following events
shall constitute an “Event of Default” under any Credit Facility Document:
(s)    Payment. The Borrowers shall fail to pay (i) any interest on the
Advances, any fees, reimbursements, indemnifications, or other amounts payable
in connection with the Credit Facility Obligations arising under this Agreement
or under any other Credit Facility Document within ten Business Day after the
earlier of (A) written notice of such default shall have been given to any
Borrower by the Administrative Agent or (B) any knowledge of such default by a
Responsible Officer of any Borrower, or (ii) any principal of any Advance
(including, without limitation, any mandatory prepayment required by Section
2.06), when the same becomes due and payable;

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(t)    Representation and Warranties. Any representation or statement made or
deemed to be made by any Borrower or any other Borrower Party (or any of their
respective officers or representatives) in this Agreement, in any other Credit
Facility Document, or in connection with this Agreement or any other Credit
Facility Document or in any report or certificate delivered from time to time
hereunder shall prove to have been incorrect in any material respect when made
or deemed to be made;
(u)    Covenant Breaches. The Borrowers or any other Borrower Party shall (i)
fail to perform or observe any covenant contained in Sections 5.01, 5.07(a),
5.09, 5.11, 5.12, and 5.16 and Article VI of this Agreement, or (ii) fail to
perform or observe any other term or covenant set forth in this Agreement or in
any other Credit Facility Document which is not covered by clause (i) above or
any other provision of this Section 7.01 if such failure under this clause (ii)
shall remain unremedied for 30 days (5 days with respect to Section 5.06) after
the earlier of (A) written notice of such default shall have been given to any
Borrower by the Administrative Agent or any Lender or (B) any knowledge of such
default by a Responsible Officer of any Borrower;
(v)    Cross-Default. (i) Any Borrower Party or any of its Subsidiaries shall
fail to pay any principal of or premium or interest on its Debt (but excluding
Debt evidenced by the Advances) when the same becomes due and payable (whether
by scheduled maturity, required prepayment, acceleration, demand or otherwise)
and the effect of such failure to pay is to accelerate the maturity of Debt in
an amount in excess of $2,500,000 (individually or when aggregated with all such
Debt of the Borrower Parties and their Subsidiaries so in default) (“Material
Debt”), (ii) any other event shall occur or condition shall exist under any
agreement or instrument relating to Material Debt of any Borrower Party or any
of its Subsidiaries (but excluding Debt evidenced by the Advances), if the
effect of such event or condition is to accelerate the maturity of such Material
Debt; or (iii) any Material Debt shall be declared to be due and payable, or
required to be prepaid (other than by a regularly scheduled required
prepayment), prior to the stated maturity thereof;
(w)    Insolvency.
(i)    Any Borrower Party or any of its Subsidiaries shall generally not pay its
debts as such debts become due, or shall admit in writing its inability to pay
its debts generally, shall commence negotiations with one or more of its
creditors with a view to rescheduling any of its Debt which it would not
otherwise be able to pay as it falls due or shall make a general assignment for
the benefit of creditors;
(ii)    any proceeding shall be instituted by or against any Borrower Party or
any of its Subsidiaries seeking to adjudicate it as a bankrupt or insolvent, or
seeking liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief, or composition of it or its debts under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors, or seeking the
entry of an order for relief or the appointment of a receiver, trustee or other
similar official for it or for any substantial part of its property and, in the
case of any such proceeding instituted against such Person, either such
proceeding shall remain undismissed for a period of 60 days or any of the
actions sought in such proceeding shall occur; or such Person shall take any
action to authorize any of the actions set forth above in this paragraph (e) or
any analogous procedure or step is taken in any jurisdiction; or

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(iii)    a court of competent jurisdiction enters an order, judgment or decree
approving the reorganization of any Borrower Party or appointing a conservator,
receiver, trustee or liquidator of a Borrower Party or of a substantial part of
its assets, and the order, judgment or decree is not permanently stayed or
reversed within 60 days after its entry.
(x)    Judgments. Any judgment, decree or order for the payment of money shall
be rendered against any Borrower Party or any of its Subsidiaries in an amount
in excess of $2,500,000 (or the equivalent in any other currency) and either (i)
enforcement proceedings shall have been commenced by any creditor upon such
judgment or order or (ii) there shall be any period of 60 consecutive days
during which a stay of enforcement of such judgment or order, by reason of a
pending appeal or otherwise, shall not be in effect (unless such judgment or
order is discharged within such 60 day period);
(y)    ERISA. (i) An ERISA Event occurs with respect to a Pension Plan or
Multiemployer Plan which has resulted or could reasonably be expected to result
in liability of any Borrower Party, under Title IV of ERISA, to the Pension
Plan, Multiemployer Plan or the PBGC or any other applicable Governmental
Authority in excess of $5,000,000, or (ii) any Borrower Party or any ERISA
Affiliate fails to pay when due, after the expiration of any applicable grace
period, any installment payment with respect to its withdrawal liability under
Section 4201 of ERISA under a Multiemployer Plan in an aggregate amount in
excess of $5,000,000;
(z)    Credit Facility Documents. Any Credit Facility Document or any material
provision thereof, at any time after its execution and delivery and for any
reason other than as expressly permitted hereunder or satisfaction in full of
all the Obligations, ceases to be in full force and effect; or any Borrower
Party or any other Person contests in any manner the validity or enforceability
of any Credit Facility Document or any material provision thereof; or any
Borrower Party or any other Person denies that it has any or further liability
or obligation under any Credit Facility Document or any material provision
thereof, or purports to revoke, terminate or rescind any Credit Facility
Document or any material provision thereof;
(aa)    Security Documents. Any Security Document shall for any reason fail to
create an Acceptable Lien in any Collateral purported to be covered thereby, in
each case, except as permitted by the terms of any Security Document, or any
Security Document shall fail to remain in full force or effect or any action
shall be taken to discontinue or to assert the invalidity or unenforceability of
any Security Document, or any Borrower Party shall fail to comply with any of
the terms or provisions of any Security Document or the Collateral Agent shall
otherwise fail to have an Acceptable Lien in and on the Collateral or an Event
of Default shall otherwise exist under any Security Document, except to the
extent otherwise permitted by this Agreement or such Security Document;
(bb)    Change of Control. A Change of Control shall occur;
(cc)    Environmental Event. An Environmental Event shall occur;
(dd)    Borrower Party Cease to Exist. Except as permitted in this Agreement,
any Borrower ceases to exist or any Guarantor ceases to exist;

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(ee)    Liens. Any federal tax Lien or any other Liens (other than Permitted
Encumbrances) totaling $2,500,000 or more arise of record against any Borrower
Party or Borrower Property’s Property and are not fully bonded or discharged
within 60 days after a Borrower Party receives actual or constructive notice of
their filing unless such Lien is Properly Contested; or
(ff)    Material Adverse Effect. At least fifteen (15) days have elapsed since
the date of the occurrence or existence of any event which could reasonably be
expected to result in a Material Adverse Effect and such event remains in effect
until the end of such fifteen (15) day period.
Section 7.02    Optional Acceleration of Maturity. If any Event of Default
(other than an Event of Default pursuant to paragraph (e) of Section 7.01) shall
have occurred and be continuing, then, and in any such event:
(m)    the Administrative Agent (i) shall at the request of the Required
Lenders, by notice to Borrower, declare the Commitments and the obligation of
each Lender to make extensions of credit hereunder, including making Advances,
to be terminated, whereupon the same shall forthwith terminate, and (ii) shall
at the request of the Required Lenders, by notice to Borrower, declare all
principal, interest, fees, reimbursements, indemnifications, and all other
amounts payable under this Agreement and the other Credit Facility Documents to
be forthwith due and payable, whereupon all such amounts shall become and be
forthwith due and payable in full, without notice of intent to demand, demand,
presentment for payment, notice of nonpayment, protest, notice of protest,
grace, notice of dishonor, notice of intent to accelerate, notice of
acceleration, and all other notices, all of which are hereby expressly waived by
each Borrower Party;
(n)    the Administrative Agent shall at the request of the Required Lenders
proceed to enforce its rights and remedies under the Security Documents, this
Agreement, and any other Credit Facility Document for the benefit of the Secured
Parties by appropriate proceedings.
(o)    each of the Administrative Agent and the Collateral Agent may at its
option, and shall at the request of the Required Lenders, make payments in
protecting the Collateral and the Collateral Agent's rights therein, in any case
at Borrower’s expense as provided in Section 9.04.
Section 7.03    Automatic Acceleration of Maturity. If any Event of Default
pursuant to paragraph (e) of Section 7.01 shall occur:
(o)    (i) the Commitments and the obligation of each Lender to make extensions
of credit hereunder, including making Advances shall terminate, and (ii) all
principal, interest, fees, reimbursements, indemnifications, and all other
amounts payable under this Agreement and the other Credit Facility Documents
shall become and be forthwith due and payable in full, without notice of intent
to demand, demand, presentment for payment, notice of nonpayment, protest,
notice of protest, grace, notice of dishonor, notice of intent to accelerate,
notice of acceleration, and all other notices, all of which are hereby expressly
waived by Borrower;

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(p)    the Administrative Agent shall at the request of the Required Lenders,
proceed to enforce its rights and remedies under the Security Documents, this
Agreement, and any other Credit Facility Document for the benefit of the Secured
Parties by appropriate proceedings.
Section 7.04    Non-exclusivity of Remedies. No remedy conferred upon the
Administrative Agent or any Lender is intended to be exclusive of any other
remedy, and each remedy shall be cumulative of all other remedies existing by
contract, at law, in equity, by statute or otherwise.
Section 7.05    Right of Set-off. If an Event of Default shall have occurred and
be continuing, each Lender and each of their respective Affiliates is 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 obligations (in whatever
currency) at any time owing by such Lender or any such Affiliate to or for the
credit or the account of a Borrower or any other Borrower Party against any and
all of the obligations of the Borrowers or such Borrower Party now or hereafter
existing under this Agreement or any other Credit Facility Document to such
Lender, irrespective of whether or not such Lender shall have made any demand
under this Agreement or any other Credit Facility Document and although such
obligations of the Borrowers or such Borrower Party may be contingent or
unmatured or are owed to a branch or office of such Lender different from the
branch or office obligated on such Debt. The rights of each Lender and their
respective Affiliates under this Section are in addition to other rights and
remedies (including other rights of setoff) that such Lender or their respective
Affiliates may have. Each Lender agrees to notify the Borrowers 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 7.06    Application of Proceeds. From and during the continuance of any
Event of Default, any monies or property actually received by the Administrative
Agent pursuant to this Agreement or any other Credit Facility Document, the
exercise of any rights or remedies under any Security Document or any other
agreement with any Borrower Party which secures any of the Obligations, shall be
applied in the following order:
(b)    First, to payment of the expenses, liabilities, losses, costs, duties,
fees, charges or other moneys whatsoever (together with interest payable
thereon) as may have been paid or incurred in, about or incidental to any sale
or other realization of Collateral or otherwise in connection with the Credit
Facility Documents, including reasonable compensation to the Administrative
Agent and its agents and counsel, and to the ratable payment of any other
unreimbursed expenses and indemnities for which the Administrative Agent or any
Secured Party is to be reimbursed pursuant to this Agreement or any other Credit
Facility Document, in each case that are then due and payable;
(c)    Second, to the ratable payment of accrued but unpaid fees of the
Administrative Agent or any Secured Party due under the Credit Facility
Documents, including, without limitation, commitment fees and fronting fees
owing to the Administrative Agent and the Lenders in respect of the Advances
under this Agreement;
(d)    Third, to the ratable payment of accrued but unpaid interest on the
Advances then due and payable under this Agreement;
(e)    Fourth, ratably, according to the then unpaid amounts thereof, without
preference or priority of any kind among them, to the payment of any Obligations
then due and payable;

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(f)    Fifth, to the ratable payment of all other outstanding Obligations then
due and payable; and
(g)    Sixth, any excess after payment in full of all Obligations shall be paid
to the Borrowers or any Borrower Party as appropriate or to such other Person
who may be lawfully entitled to receive such excess.
If payment of all of the Obligations is tendered by the Borrowers or otherwise
recovered by the Collateral Agent following an Event of Default under any
circumstances, such tender or recovery shall be deemed a prepayment by the
Borrowers, and the Borrowers shall pay the fees provided in the Fee Letter in
accordance with the Fee Letter. Such fees shall also become immediately due and
owing in the event of any acceleration of the Obligations whether at the
election of the Administrative Agent or automatically pursuant to the terms of
this Agreement. Such fees shall be secured by all security and Collateral for
the Obligations and shall, after it becomes due and payable, be treated as if it
were added to the Obligations for all purposes including accrual of interest,
foreclosure (whether through power of sale, judicial proceeding, or otherwise)
(“Foreclosure Sale”), redemption, and bankruptcy (including pursuant to Section
506 of the United States Bankruptcy Code or any successor provision); without
limiting the generality of the foregoing, it is understood and agreed that such
fees may be added to the Collateral Agent’s bid at any Foreclosure Sale. If such
fee is due hereunder and pursuant to the Fee Letter, the Administrative Agent
shall deliver to the Borrowers a statement setting forth the amount and
determination of such fee, and, the Borrower shall not have the right to
challenge the calculation or the method of calculation set forth in any such
statement in the absence of manifest error.
ARTICLE VIII    
THE ADMINISTRATIVE AGENT
Section 8.01    Appointment and Authority. Each of the Lenders hereby
irrevocably appoints MBL to act on its behalf as the Administrative Agent
hereunder and under the other Credit Facility Documents and authorizes the
Administrative Agent to take such actions on its behalf and to exercise such
powers as are delegated to it by the terms hereof or thereof, together with such
actions and powers as are reasonably incidental thereto. The provisions of this
Article are solely for the benefit of the Administrative Agent, the Lenders, and
none of the Borrowers nor any other Borrower Party shall have rights as a third
party beneficiary of any of such provisions.
Section 8.02    Rights as a Lender. The Person serving as Administrative Agent
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 Administrative
Agent and the term “Lender” or “Lenders” shall, unless otherwise expressly
indicated or unless the context otherwise requires, include the Person serving
as Administrative Agent hereunder in its individual capacity. Such Person and
its Affiliates may accept deposits from, lend money to, act as the financial
advisor or in any other advisory capacity for and generally engage in any kind
of business with any Borrower Party or Affiliate thereof as if such Person were
not Administrative Agent hereunder and without any duty to account therefor to
the Lenders.
Section 8.03    Exculpatory Provisions. The Administrative Agent shall not have
any duties or obligations except those expressly set forth herein and in the
other Credit Facility Documents. Without limiting the generality of the
foregoing, the Administrative Agent:
(bb)    shall not be subject to any fiduciary or other implied duties,
regardless of whether a Default has occurred and is continuing;

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(cc)    shall not have any duty to take any discretionary action or exercise any
discretionary powers, except discretionary rights and powers expressly
contemplated hereby or by the other Credit Facility Documents that the
Administrative Agent is required to exercise as directed in writing by the
Required Lenders (or such other number or percentage of the Lenders as shall be
expressly provided for herein or in the other Credit Facility Documents),
provided that the Administrative Agent shall not be required to take any action
that, in its opinion or the opinion of its counsel, may expose the
Administrative Agent to liability or that is contrary to any Credit Facility
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 affect a forfeiture, modification or termination of property of a Defaulting
Lender in violation of any Debtor Relief Law; and
(dd)    shall not, except as expressly set forth herein and in the other Credit
Facility Documents, have any duty to disclose, and shall not be liable for the
failure to disclose, any information relating to the Borrowers, any other
Borrower Party or any Affiliate thereof that is communicated to or obtained by
the Person serving as Administrative Agent or any of its Affiliates in any
capacity.
The Administrative Agent shall not be liable for any action taken or not taken
by it (i) 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 the
Administrative Agent shall believe in good faith shall be necessary, under the
circumstances as provided in Section 9.01) or (ii) in the absence of its own
gross negligence or willful misconduct. The Administrative Agent shall be deemed
not to have knowledge of any Default unless and until notice describing such
Default is given to the Administrative Agent by a Borrower or a Lender.
The Administrative Agent shall not be responsible for or have any duty to
ascertain or inquire into (i) any statement, warranty or representation made in
or in connection with this Agreement or any other Credit Facility Document, (ii)
the contents of any certificate, report or other document delivered hereunder or
thereunder or in connection herewith or therewith, (iii) the performance or
observance of any of the covenants, agreements or other terms or conditions set
forth herein or therein or the occurrence of any Default, (iv) the validity,
enforceability, effectiveness or genuineness of this Agreement, any other Credit
Facility Document or any other agreement, instrument or document or (v) the
satisfaction of any condition set forth in Article III or elsewhere herein,
other than to confirm receipt of items expressly required to be delivered to the
Administrative Agent.
Section 8.04    Reliance by Administrative Agent. The Administrative 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. The Administrative
Agent also may 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 an Advance that by its terms must be fulfilled to the
satisfaction of a Lender, the Administrative Agent may presume that such
condition is satisfactory to such Lender unless the Administrative Agent shall
have received notice to the contrary from such Lender prior to the making of
such Advance. The Administrative Agent may consult with legal counsel (who may
be counsel for the Borrowers), independent accountants and other experts

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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.
Section 8.05    Delegation of Duties. The Administrative Agent may perform any
and all of its duties and exercise its rights and powers hereunder or under any
other Credit Facility Document by or through any one or more sub-agents
appointed by the Administrative Agent. The Administrative Agent and any such
sub-agent may perform any and all of its duties and exercise its rights and
powers by or through their respective Related Parties. The exculpatory
provisions of this Article shall apply to any such sub-agent and to the Related
Parties of the Administrative Agent and any such sub-agent, and shall apply to
their respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as the Administrative
Agent.
Section 8.06    Resignation of Administrative Agent. The Administrative Agent
may at any time give notice of its resignation to the Lenders and the Borrowers.
Upon receipt of any such notice of resignation, the Required Lenders shall have
the right, in consultation with the Borrowers, to appoint a successor, which
shall be a Lender. 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, then the
retiring Administrative Agent may on behalf of the Lenders, appoint a successor
Administrative Agent as set forth above provided that if the Administrative
Agent shall notify the Borrowers and the Lenders that no Person has accepted
such appointment, then such resignation shall nonetheless become effective in
accordance with such notice and upon such resignation or any removal, (1) the
retiring Administrative Agent shall be discharged from its duties and
obligations hereunder and under the other Credit Facility Documents (except that
in the case of any collateral security held by the Administrative Agent on
behalf of the Lenders under any of the Credit Facility Documents, the retiring
Administrative Agent shall continue to hold such collateral security until such
time as a successor Administrative Agent is appointed) and (2) except for any
indemnity payments owed to the retiring or removed Administrative Agent, all
payments, communications and determinations provided to be made by, to or
through the Administrative Agent shall instead be made by or to each Lender
directly, until such time as the Required Lenders appoint a successor
Administrative Agent as provided for above in this paragraph, provided that all
payments of Cash Collateral shall continue to be made to the Cash Collateral
Account. Upon the acceptance of a successor's appointment as Administrative
Agent hereunder, such successor shall succeed to and become vested with all of
the rights, powers, privileges and duties of the retiring (or retired)
Administrative Agent (other than any rights to indemnity payments owed to the
retiring Administrative Agent), and the retiring Administrative Agent shall be
discharged from all of its duties and obligations hereunder or under the other
Credit Facility Documents (if not already discharged therefrom as provided above
in this paragraph). The fees payable by the Borrowers to a successor
Administrative Agent shall be the same as those payable to its predecessor
unless otherwise agreed between the Borrowers and such successor. After the
retiring Administrative Agent's resignation hereunder and under the other Credit
Facility Documents, the provisions of this Article, Section 9.04 and Section
9.05 shall continue in effect for the benefit of such retiring Administrative
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
Administrative Agent was acting as Administrative Agent.
Section 8.07    Non-Reliance on Administrative Agent and Other Lenders. Each
Lender acknowledges that it has, independently and without reliance upon the
Administrative Agent 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
Administrative Agent 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

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upon this Agreement, any other Credit Facility Document or any related agreement
or any document furnished hereunder or thereunder.
Section 8.08    Indemnification. The Lenders severally agree to indemnify upon
demand the Administrative Agent, and each Related Party of any of the foregoing
(to the extent not reimbursed by the Borrower Parties), according to their
respective Pro Rata Shares, and hold harmless each Indemnitee (as defined in
Section 9.05) from and against any and all Indemnified Liabilities (as defined
in Section 9.05), including in connection with any Security Documents entered by
MBL in its individual capacity that would create or perfect a security interest
for the benefit of the Secured Parties; provided, however, that no action taken
in accordance with the directions of the Required Lenders shall be deemed to
constitute gross negligence or willful misconduct for purposes of this Section.
Without limitation of the foregoing, each Lender severally agrees to reimburse
the Administrative Agent, promptly upon demand for its ratable share of any out
of pocket expenses (including all fees, expenses and disbursements of any law
firm or other external counsel) incurred by the Administrative Agent in
connection with the preparation, execution, delivery, administration,
modification, amendment, or enforcement (whether through negotiations, legal
proceedings, or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement or any other Credit Facility Document, to
the extent that the Administrative Agent is required to be reimbursed by the
Borrower Parties pursuant to Sections 9.04 or 9.05 and is not reimbursed for
such by the Borrower Parties. The undertaking in this Section shall survive
termination of the Commitments, the payment of all other Obligations and the
resignation of the Administrative Agent.
Section 8.09    Collateral Matters.
(a)    The Lenders irrevocably authorize the Administrative Agent, at its option
and in its discretion, without the necessity of any notice to or further consent
from the Secured Parties:
(i)    to enter into the CAA on behalf of the Administrative Agent and the
Lenders:
(ii)    to take the actions contemplated by Section 2.14;
(iii)    provide the Collateral Agent with written notice that Collateral may be
released from the Liens of the Security Documents (A) that is sold or to be sold
as part of or in connection with any sale permitted hereunder or under any other
Credit Facility Document, or (B) subject to Section 9.01, if approved,
authorized or ratified in writing by the Required Lenders.
(iv)    to take any actions with respect to any Collateral or Security Documents
which may be necessary to perfect and maintain an Acceptable Lien upon the
Collateral granted pursuant to the Security Documents; and
(v)    to take any action in exigent circumstances as may be reasonably
necessary to preserve any rights or privileges of the Secured Parties under the
Credit Facility Documents or applicable Legal Requirements.
(b)    Upon the request of the Administrative Agent at any time, the Lenders
will confirm in writing the Administrative Agent's authority to release
particular types or items of Collateral pursuant to this Section 8.09.

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(c)    Each Borrower Party hereby irrevocably appoints the Administrative Agent
as such Borrower Party's attorney-in-fact, with full authority, to act for such
Borrower Party and in the name of such Borrower Party to, in the Administrative
Agent's discretion upon the occurrence and during the continuation of an Event
of Default, file one or more financing or continuation statements, and
amendments thereto, relative to all or any part of the Collateral, to receive,
endorse, and collect any accounts, drafts or other instruments, documents, and
chattel paper which are part of the Collateral, and to ask, demand, collect, sue
for, recover, compromise, receive, and give acquittance and receipts for moneys
due and to become due under or in respect of any of the Collateral and to file
any claims or take any action or institute any proceedings which the
Administrative Agent may reasonably deem necessary or desirable for the
collection of any of the Collateral or otherwise to enforce the rights of the
Administrative Agent with respect to any of the Collateral. The power of
attorney granted hereby is coupled with an interest and is irrevocable.
(d)    If any Borrower Party fails to perform any covenant contained in this
Agreement or the other Security Documents, the Administrative Agent may (but
shall not be obligated to) itself perform, or cause performance of, such
covenant, and such Borrower Party shall pay for the expenses of the
Administrative Agent incurred in connection therewith in accordance with Section
9.04.
(e)    The powers conferred on the Administrative Agent under this Agreement and
the Security Documents are solely to protect its interest in the Collateral and
shall not impose any duty upon it to exercise any such powers. Beyond the safe
custody thereof, the Administrative Agent and each Lender shall have no duty
with respect to any Collateral in its possession or control (or in the
possession or control of any agent or bailee) or with respect to any income
thereon or the preservation of rights against prior parties or any other rights
pertaining thereto. The Administrative Agent shall be deemed to have exercised
reasonable care in the custody and preservation of the Collateral in its
possession if the Collateral is accorded treatment substantially equal to that
which the Administrative Agent accords its own property. Neither the
Administrative Agent nor any Lender shall be liable or responsible for any loss
or damage to any of the Collateral, or for any diminution in the value thereof,
by reason of the act or omission of any warehouseman, carrier, forwarding
agency, consignee, broker or other agent or bailee selected by Borrower or
selected by the Administrative Agent in good faith.
Section 8.10    No Other Duties, Etc. Anything herein to the contrary
notwithstanding, none of the Bookrunners or Arrangers listed on the cover page
hereof shall have any powers, duties or responsibilities under this Agreement or
any of the other Credit Facility Documents, except in its capacity, as
applicable, as the Administrative Agent or a Lender hereunder.
ARTICLE IX    
MISCELLANEOUS
Section 9.01    Amendments, Etc. No amendment or waiver of any provision of this
Agreement or any other Credit Facility Document (other than as to Fee Letter and
any fee letters, if any, between the Borrowers and the Administrative Agent),
and no consent to any departure by any Borrower or any other Borrower Party
therefrom, shall in any event be effective unless the same shall be in writing
and signed by the Required Lenders and the Borrowers, and then such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given; provided, however, that no amendment, waiver or consent
shall:

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(q)    extend or increase the Commitment of any Lender (or reinstate any
Commitment terminated pursuant to Section 7.02) without the written consent of
such Lender;
(r)    postpone any date fixed by this Agreement or any other Credit Facility
Document for any payment or mandatory prepayment of principal, interest, fees or
other amounts due to the Lenders (or any of them) hereunder or under any other
Credit Facility Document without the written consent of each Lender directly
affected thereby;
(s)    reduce the principal of, or the rate of interest specified herein on, any
Advance, or (subject to clause (iii) of the proviso to this Section 9.01) any
fees or other amounts payable hereunder or under any other Credit Facility
Document, without the written consent of each Lender directly affected thereby;
provided, however, that only the consent of the Required Lenders shall be
necessary to amend Section 2.05(e) or to waive any obligation of the Borrowers
to pay interest at the default rate specified therein;
(t)    change Section 2.11 or any other provision of this Agreement in a manner
that would alter the pro rata sharing of payments or the pro rata allocation of
disbursements required thereby without the written consent of each Lender;
(u)    change any provision of this Section or the definition of “Required
Lenders” or any other provision hereof specifying the number or percentage of
Lenders required to amend, waive or otherwise modify any rights hereunder or
make any determination or grant any consent hereunder, without the written
consent of each Lender;
(v)    except as otherwise provided in Section 8.09, release any Guarantor from
the Guaranty or all or substantially all of the Collateral or such Collateral as
would cause Availability to be less than zero, without the written consent of
each Lender;
(w)    change Section 7.06 or any other provision of this Agreement in a manner
that would alter the order of application of proceeds set forth in Section 7.06
without the written consent of each Lender directly affected thereby;
(x)    change or waive the application of Section 2.06(c)(i) without the written
consent of each Lender;
(y)    change the definition of “Borrowing Base” or any of the defined terms
used therein without the written consent of each Lender;
(z)    change or waive the application of Section 2.06(c)(i) without the written
consent of each Lender;
and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the Administrative Agent in addition to the Lenders
required above, affect the rights or duties of the Administrative Agent under
this Agreement or any other Credit Facility Document; and (ii) the Fee Letter
and any fee letters, if any, between the Administrative Agent and the Borrowers
may be amended, or rights or privileges thereunder waived, in a writing executed
only by the parties thereto. Notwithstanding anything to the contrary herein, no
Defaulting Lender shall have any right to approve or disapprove any amendment,
waiver, or

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consent hereunder, except that the Commitment of such Lender may not be
increased or extended without the consent of such Lender.
Section 9.02    Notices, Etc.
(ee)    General. Except in the case of notices and other communications
expressly permitted to be given by telephone (and except as provided in
paragraph (c) 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, sent by facsimile or (subject to
subsection (d) below) electronic mail address as follows:
(i)    if to the Borrowers or any other Borrower Party, to the address,
facsimile number, electronic mail address or telephone number specified for such
Person on Schedule 9.02 or to such other address, facsimile number, electronic
mail address or telephone number as shall be designated by such party in a
notice to the other parties;
(ii)    if to the Administrative Agent, (x) in relation to notices which are
specifically required pursuant to the terms of this Agreement to be delivered to
the Administrative Office, to the address, facsimile number, electronic mail
address or telephone number of the Administrative Office on Schedule 9.02 and
(y) in relation to all other notices, to the address, facsimile number,
electronic mail address or telephone number set forth as the Applicable Lending
Office on Schedule 9.02, or in each case to such other address as shall be
designated by such party in a notice to the other parties from time to time; and
(iii)    if to any other Lender, to the address, facsimile number, electronic
mail address or telephone number specified in its Administrative Questionnaire
or to such other address, facsimile number, electronic mail address or telephone
number as shall be designated by such party in a notice to the Administrative
Agent.
(ff)    Effectiveness in General. 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 telecopier 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 paragraph (d) below, shall be effective
as provided in said paragraph (d). In no event shall a voicemail message be
effective as a notice, communication or confirmation hereunder.
(gg)    Effectiveness of Facsimile Documents and Signatures. Credit Facility
Documents may be transmitted and/or signed by facsimile. The effectiveness of
any such documents and signatures shall, subject to applicable Legal
Requirements, have the same force and effect as manually-signed originals and
shall be binding on all Borrower Parties, the Administrative Agent and the
Lenders. The Administrative Agent may also require that any such documents and
signatures be confirmed by a manually-signed original thereof; provided,
however, that the failure to request or deliver the same shall not limit the
effectiveness of any facsimile document or signature.
(hh)    Limited Use of Electronic Mail. Notices and other communications to the
Lenders hereunder may be delivered or furnished by electronic communication
(including e-

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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, as applicable, has notified
the Administrative Agent that it is incapable of receiving notices under such
Article by electronic communication. The Administrative Agent or the Borrowers
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), provided that if such notice 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, 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.
(ii)    Reliance by Administrative Agent and Lenders. The Administrative Agent
and the Lenders shall be entitled to rely and act upon any notices (including
telephonic Borrowing Requests) purportedly given by or on behalf of the
Borrowers even if (i) such notices were not made in a manner specified herein,
were incomplete or were not preceded or followed by any other form of notice
specified herein, or (ii) the terms thereof, as understood by the recipient,
varied from any confirmation thereof. THE BORROWERS SHALL INDEMNIFY THE
ADMINISTRATIVE AGENT, EACH LENDER AND THEIR RELATED PARTIES FROM ALL LOSSES,
COSTS, EXPENSES AND LIABILITIES RESULTING FROM THE RELIANCE BY SUCH PERSON ON
EACH NOTICE PURPORTEDLY GIVEN BY OR ON BEHALF OF THE BORROWERS. All telephonic
notices to and other communications with the Administrative Agent may be
recorded by the Administrative Agent, and each of the parties hereto hereby
consents to such recording.
(jj)    Recordation. It is understood and agreed by Borrowers that the
Administrative Agent reserves the right to record all telephone conversations
between any Borrower and the Administrative Agent and to retain tapes of such
conversations for such periods of time as Lender deems advisable from time to
time.
(kk)    Borrower Agent. Each Borrower hereby designates Horsehead Corporation as
its representative and agent (in such capacity, “Borrowers’ Agent”) for all
purposes under this Agreement and the other Credit Facility Documents, including
requests for Advances, delivery or receipt of communications with any Secured
Party, preparation and delivery of Borrowing Base Certificates and financial
reports, receipt and payment of Obligations, requests for waivers, amendments or
other accommodations, actions under this Agreement or the other Credit Facility
Documents (including in respect of compliance with covenants), and all other
dealings with any Secured Party. Such Person hereby accepts such appointment.
Each Secured Party shall be entitled to rely upon, and shall be fully protected
in relying upon, any notice or communication (including any notice of borrowing)
delivered by Borrowers’ Agent on behalf of any Borrower. Each Secured Party may
give any notice or communication with a Borrower hereunder to Borrower’ Agent on
behalf of such Borrower. Each Secured Party shall have the right, in its
discretion, to deal exclusively with Borrowers’ Agent for any or all purposes
under the Credit

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Facility Documents. Each Borrower agrees that any notice, election,
communication, representation, agreement or undertaking made on its behalf by
Borrowers’ Agent shall be binding upon and enforceable against it.
Section 9.03    No Waiver; Cumulative Remedies. No failure on the part of any
Lender or the Administrative Agent to exercise, and no delay by any such Person
in exercising, any right, remedy, power or privilege hereunder shall operate as
a waiver thereof; nor shall any single or partial exercise of any such right
preclude any other or further exercise thereof or the exercise of any other
right, remedy, power or privilege. The rights, remedies, powers and privileges
herein provided in this Agreement are cumulative and not exclusive of any
rights, remedies, powers and privileges provided by law.
Section 9.04    Costs and Expenses. The Borrowers shall pay (i) all expenses
incurred by the Administrative Agent and its Affiliates (including the fees,
charges and disbursements of counsel for the Administrative Agent) in connection
with the preparation, negotiation, execution, delivery and administration of
this Agreement and the other Credit Facility Documents or any amendments,
modifications or waivers (whether or not the transactions contemplated hereby or
thereby shall be consummated), (ii) all third party expenses incurred by the
Collateral Agent, the Administrative Agent or any Lender (including the
documented fees, charges and disbursements of any counsel for the Collateral
Agent, the Administrative Agent or any Lender, including the third party
expenses of executing, recording, filing and perfecting the Security Documents
and the costs of any title policy in connection with the Mortgages, including
all endorsements, and any updated survey required by the Administrative Agent or
the Collateral Agent in connection therewith), provided that the Administrative
Agent and the Lenders shall endeavor to use the same single counsel in
connection with the enforcement or protection of its rights (A) in connection
with this Agreement and the other Credit Facility Documents, including its
rights under this Section, or (B) in connection with the Advances made
hereunder, including all such third party expenses incurred during any workout,
restructuring or negotiations in respect of such Advances, provided that the
Administrative Agent and the Lenders shall endeavor to use the same single
counsel. The foregoing costs and expenses shall include all search, filing,
recording, appraisal charges and fees and taxes related thereto, and other third
party expenses incurred by the Administrative Agent and the cost of independent
public accountants and other outside experts retained by the Administrative
Agent. All amounts due under this Section 9.04 shall be payable within ten
Business Days after demand therefor. The agreements in this Section shall
survive the termination of the Commitments and repayment of all other
Obligations.
Section 9.05    Indemnification. Each Borrower Party shall indemnify the
Collateral Agent, the Administrative Agent, 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 liabilities,
obligations, losses, damages, penalties, claims, demands, actions, judgments,
suits, costs, expenses, or disbursements (including all fees, expenses and
disbursements of any law firm or other external counsel) of any kind or nature
whatsoever which may be imposed on, incurred by, or asserted against any
Indemnitee in any way relating to or arising out of or in connection with (a)
the execution, delivery, enforcement, performance, or administration of this
Agreement, any Credit Facility Document, or any other agreement, letter or
instrument delivered in connection with the transactions contemplated thereby or
the consummation of the transactions contemplated thereby, (b) any Commitment,
Advance or the use or proposed use of the proceeds therefrom, (c) any action
taken or omitted by the Collateral Agent, the Administrative under this
Agreement or any other Credit Facility Document (including the Collateral
Agent’s, the Administrative Agent's own negligence), (d) any actual or alleged
presence or release of Hazardous Materials on or from any property currently or
formerly owned or operated by the Borrowers or any other Borrower Party, or any
Environmental Liability related in any way to the Borrowers or any other
Borrower Party, (e) any actual or prospective claim, litigation, investigation
or proceeding relating to any of the foregoing, whether based on

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contract, tort or any other theory (including any investigation of, preparation
for, or defense of any pending or threatened claim, investigation, litigation or
proceeding) and regardless of whether any Indemnitee is a party thereto, in all
cases, whether or not caused by or arising, in whole or in part, out of the
negligence of any Indemnitee, (f) the failure of any Borrower Party or any
Affiliate to comply with any Legal Requirement, including any Environmental Law,
including with respect to the presence, generation, storage, Release, threatened
Release, use, transportation, disposal or arranging for the disposal or
treatment of any solid waste or Hazardous Materials on, under, or from any
Borrower Party’s or any Affiliate’s Property, (g) creating, perfecting,
maintaining, or enforcing any Lien, (h) taking possession of, protecting,
preserving and preparing for sale any of the Collateral as permitted by this
Agreement and the Credit Facility Documents when an Event of Default exists, and
(i) the acquisition, ownership or operation of any of the Collateral or any
other Property by any Borrower Party or any other Person; provided that such
indemnity shall not, as to any Indemnitee, be available to the extent that such
liabilities, obligations, losses, damages, penalties, claims, demands, actions,
judgments, suits, costs, expenses or disbursements are determined by a court of
competent jurisdiction by final and nonappealable judgment to have resulted from
the gross negligence or willful misconduct of such Indemnitee except as may
expressly be provided under this Agreement (all the foregoing, collectively, the
“Indemnified Liabilities”).
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, EACH BORROWER PARTY SHALL NOT
ASSERT, AND HEREBY WAIVES, ANY CLAIM AGAINST ANY INDEMNITEE, AND EACH INDEMNITEE
SHALL NOT ASSERT, AND HEREBY WAIVES, ANY CLAIM AGAINST ANY BORROWER 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 CREDIT FACILITY DOCUMENT OR
ANY AGREEMENT OR INSTRUMENT CONTEMPLATED HEREBY, THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY, ANY LOAN OR THE USE OF THE PROCEEDS THEREOF; PROVIDED THAT
NOTHING HEREIN SHALL RELIEVE ANY BORROWER PARTY OF ANY OBLIGATION IT MAY HAVE TO
INDEMNIFY ANY INDEMNITEE AGAINST SPECIAL, INDIRECT, CONSEQUENTIAL OR PUNITIVE
DAMAGES ASSERTED AGAINST SUCH INDEMNITEE BY A THIRD PARTY. NO INDEMNITEE 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 CREDIT FACILITY DOCUMENTS OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY OTHER THAN DIRECT OR ACTUAL DAMAGES RESULTING
FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH INDEMNITEE AS DETERMINED
BY A FINAL AND NONAPPEALABLE JUDGMENT OF A COURT OF COMPETENT JURISDICTION. ALL
AMOUNTS DUE UNDER THIS SECTION 9.05 SHALL BE PAYABLE WITHIN TEN BUSINESS DAYS
AFTER WRITTEN DEMAND THEREFOR SETTING FORTH IN REASONABLE DETAIL THE BASIS FOR
THE AMOUNT CLAIMED. THE AGREEMENTS IN THIS SECTION SHALL SURVIVE THE RESIGNATION
OF THE ADMINISTRATIVE AGENT, THE REPLACEMENT OF ANY LENDER, THE TERMINATION OF
THE COMMITMENTS AND THE REPAYMENT, SATISFACTION OR DISCHARGE OF ALL THE OTHER
OBLIGATIONS.
Section 9.06    Joint and Several Liability. .
(g)    NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, EACH BORROWER HEREBY
EXPRESSLY AGREES FOR THE BENEFIT OF THE SECURED

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PARTIES THAT ALL OBLIGATIONS UNDER THIS AGREEMENT AND THE OTHER CREDIT FACILITY
DOCUMENTS HEREUNDER ARE THE JOINT AND SEVERAL OBLIGATIONS OF ALL BORROWERS
REGARDLESS OF WHICH BORROWER REQUESTS OR RECEIVES ANY ADVANCE CONTEMPLATED BY
THIS AGREEMENT. EACH BORROWER CONFIRMS THAT IT WILL DERIVE SUBSTANTIAL DIRECT
AND INDIRECT BENEFIT FROM THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT AND
THE OTHER CREDIT FACILITY DOCUMENTS AND SUCH TRANSACTIONS ARE NECESSARY OR
CONVENIENT TO THE CONDUCT, PROMOTION OR ATTAINMENT OF THE BUSINESS, PURPOSES OR
ACTIVITIES OF SUCH BORROWER.
(h)    Anything contained in this Agreement or any other Credit Facility
Document to the contrary notwithstanding, the obligations of each Borrower under
the Credit Facility Documents on any date shall be limited to a maximum
aggregate amount equal to the largest amount that would not, on such date,
render its obligations hereunder subject to avoidance as a fraudulent transfer
or conveyance under Section 548 of the Bankruptcy Code of the United States or
any applicable provisions of comparable laws relating to bankruptcy, insolvency,
or reorganization, or relief of debtors (collectively, the “Fraudulent Transfer
Laws”), but only to the extent that any Fraudulent Transfer Law has been found
in a final non-appealable judgment of a court of competent jurisdiction to be
applicable to such obligations as of such date, in each case (i) after giving
effect to all liabilities of such Borrower, contingent or otherwise, that are
relevant under the Fraudulent Transfer Laws, but specifically excluding (x) any
liabilities of such Borrower in respect of intercompany indebtedness to the
other Borrower or other affiliates of such Borrower or the other Borrower to the
extent that such indebtedness would be discharged in an amount equal to the
amount paid by such Borrower hereunder; (y) any liabilities of such Borrower
under the Credit Facility Documents; and (z) any liabilities of such Borrower
under other guarantees of and joint and several co-borrowings of indebtedness,
entered into on the date the Credit Facility Documents becomes effective, which
contain a limitation as to maximum amount substantially similar to that set
forth in this Section 9.06(b) (each such other guarantee and joint and several
co-borrowing entered into on the date the Credit Facility Documents becomes
effective, a “Competing Guaranty”) to the extent such Borrower’s liabilities
under such Competing Guaranty exceed an amount equal to (1) the aggregate
principal amount of such Borrower’s obligations under such Competing Guaranty
(notwithstanding the operation of that limitation contained in such Competing
Guaranty that is substantially similar to this Section 9.06(b)), multiplied by
(2) a fraction (I) the numerator of which is the aggregate principal amount of
such Borrower’s obligations under such Competing Guaranty (notwithstanding the
operation of that limitation contained in such Competing Guaranty that is
substantially similar to this Section 9.06(b)), and (II) the denominator of
which is the sum of (A) the aggregate principal amount of the obligations of
such Borrower under all other Competing Guaranties (notwithstanding the
operation of those limitations contained in such other Competing Guaranties that
are substantially similar to this Section 9.06(b)), (B) the aggregate principal
amount of the obligations of such Borrower under the Credit Facility Documents
(notwithstanding the operation of this Section 9.06(b)), and (C) the aggregate
principal amount of the obligations of such Borrower under such Competing
Guaranty (notwithstanding the operation of that limitation contained in such
Competing Guaranty that is substantially similar to this Section 9.06(b)); and
(ii) after giving effect as assets to the value (as determined under the
applicable provisions of the Fraudulent Transfer Laws) of any rights to
subrogation, reimbursement, indemnification or contribution of such Borrower
pursuant to applicable law or

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pursuant to the terms of any agreement (including any such right of contribution
under Section 9.06(b)).
(i)    Each Borrower hereby subordinates any claims, including any rights at law
or in equity to payment, subrogation, reimbursement, exoneration, contribution,
indemnification or set off, as well as all defenses available to a surety,
guarantor or accommodation co-obligor, that it may have at any time against the
other Borrower or any other Borrower Party, and any successor or assign of any
such Person, including any creditor representative or debtor in possession,
howsoever arising, due or owing or whether heretofore, now or hereafter
existing, to the irrevocable and indefeasible payment in full of all
Obligations.
Section 9.07    Successors and Assigns.
(f)    Generally. The terms and provisions of this Agreement and the other
Credit Facility Documents shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns permitted hereby,
except that the neither the Borrowers nor any other Borrower Party may assign or
otherwise transfer any of its rights or obligations hereunder without the prior
written consent of each Lender and no Lender may assign or otherwise transfer
any of its rights or obligations hereunder except (i) to an Eligible Assignee in
accordance with the provisions of subsection (b) of this Section, (ii) by way of
participation in accordance with the provisions of subsection (f) of this
Section, or (iii) by way of pledge or assignment of a security interest subject
to the restrictions of subsection (d) 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 and, to the extent expressly contemplated hereby, the
Indemnitees) any legal or equitable right, remedy or claim under or by reason of
this Agreement.
(g)    Assignments by Lenders. Any Lender may assign to one or more Eligible
Assignees all or any portion of its rights and obligations under this Agreement
(including, without limitation, all or a portion of its Commitments, the
Advances owing to); provided, however, that
(i)    except (A) in the case of an assignment of the entire remaining amount of
the assigning Lender's Commitment and the Advances being assigned at the time
owing to it or (B) in the case of an assignment to a Lender or an Affiliate of a
Lender or Approved Fund with respect to such Lender, the aggregate amount of the
Commitments and Advances, of such Lender being assigned pursuant to each such
assignment (determined as of the date of the Assignment and Acceptance with
respect to such assignment) shall not be less than $20,000,000;
(ii)    the parties to each such assignment shall execute and deliver to the
Administrative Agent, for its acceptance and recording in the Register, an
Assignment and Acceptance; and
(iii)    each Eligible Assignee (other than an Eligible Assignee that is a
Lender or an Affiliate of a Lender) shall pay to the Administrative Agent a
$5,000 processing and recording fee.
Upon such execution, delivery, 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 Acceptance, (A) the Eligible
Assignee thereunder shall be a party hereto for all

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purposes and, to the extent that rights and obligations hereunder have been
assigned to it pursuant to such Assignment and Acceptance, have the rights and
obligations of a Lender hereunder and (B) such assigning Lender thereunder
shall, to the extent that rights and obligations hereunder have been assigned by
it pursuant to such Assignment and Acceptance, relinquish its rights and be
released from its obligations under this Agreement (and, in the case of an
Assignment and Acceptance covering all or the remaining portion of such 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
2.07, 2.09, 9.04 and 9.05 with respect to facts and circumstances occurring
prior to the effective date of such assignment).
(h)    Register. The Administrative Agent shall maintain a copy of each
Assignment and Acceptance delivered to and accepted by it and a register for the
recordation of the names and addresses of the Lenders and the Commitments of,
and principal amount of the Advances owing to, each Lender from time to time
(the “Register”). The entries in the Register shall be conclusive and binding
for all purposes, absent manifest error, and each of the Borrower Parties, the
Administrative Agent, and the Lenders may treat each Person whose name is
recorded in the Register as a Lender hereunder for all purposes of this
Agreement. The Register shall be available for inspection by the Borrowers or
any Lender at any reasonable time and from time to time upon reasonable prior
notice.
(i)    Pledge of Lender's Interest. 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 or other central 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.
(j)    Participations. Any Lender may at any time, without the consent of, or
notice to, the Borrowers or the Administrative Agent, sell participations to any
Person (other than a natural Person, a Defaulting Lender or any of the Borrowers
or the Borrower’s Subsidiaries or Affiliates) (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 its Commitment and/or the Advances 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 Borrowers, the
Administrative Agent, the 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 8.08 with respect to any payments made by such
Lender to its Participants. Any agreement or instrument pursuant to which a
Lender sells such a participation shall provide that such Lender shall retain
the sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any provision of this Agreement. Subject to subsection
(e) of this Section, the Borrowers agree that each Participant shall be entitled
to the benefits of Sections 2.07, 2.08 and 2.10 to the same extent as if it were
a Lender and had acquired its interest by assignment pursuant to subsection (b)
of this Section. To the extent permitted by law, each Participant also shall be
entitled to the benefits of Section 7.05 as though it were a Lender, provided
such Participant agrees to be subject to Section 2.11 as though it were a
Lender. Each Lender that sells a participation shall, acting solely for this
purpose as an agent of the Borrowers, 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 Loans or other

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obligations under the Credit Facility Documents (the “Participant Register”);
provided that no Lender shall have any obligation to disclose all or any portion
of the Participant Register (including the identity of any Participant or any
information relating to a Participant's interest in any commitments, loans,
letters of credit or its other obligations under any Credit Facility Document)
to any Person except to the extent that such disclosure is necessary to
establish that such commitment, loan, letter of credit or other obligation is in
registered form under Section 5f.103-1(c) of the United States Treasury
Regulations. The entries in the 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. For the avoidance
of doubt, the Administrative Agent (in its capacity as Administrative Agent)
shall have no responsibility for maintaining a Participant Register.
(k)    Limitations upon Participant Rights. A Participant shall not be entitled
to receive any greater payment under Section 2.08 or 2.10 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 Borrowers’ 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 2.10 unless the Borrowers are notified of the participation
sold to such Participant and such Participant agrees, for the benefit of the
Borrowers, to comply with Section 2.13(a) as though it were a Lender.
Section 9.08    Confidentiality.
(f)    Each of the Administrative Agent and the Lenders agrees to maintain the
confidentiality of the Information (as defined below), except that Information
may be disclosed (a) to its and its Affiliates' directors, officers, employees
and agents, including accountants, legal counsel and other advisors (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 requested by any judicial,
legislative, or regulatory authority (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 Credit Facility Document or any action
or proceeding relating to this Agreement or any other Credit Facility Document
or the enforcement of rights hereunder or thereunder, (f) subject to an
agreement containing provisions substantially the same as those of this Section
9.08(a), (i) to any assignee of or Participant in, or any prospective assignee
of or Participant in, any of its rights and obligations under this Agreement,
(ii) to any actual or prospective counterparty to any derivative or
securitization transaction related to the Credit Facility Obligations under this
Agreement, and (iii) to any credit insurance provider relating to the Borrowers
or any of its Subsidiaries, (g) with the consent of the Borrowers or (h) to the
extent such Information (x) becomes publicly available other than as a result of
a breach of this Section 9.08(a) or (y) becomes available to the Administrative
Agent or any Lender on a nonconfidential basis from a source other than a
Borrower Party. For purposes of this Section, “Information” means all
information received from any Borrower Party relating to any Borrower Party 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 any Borrower Party; provided
that, in the case of information received from a Borrower Party after the date
hereof, such information is clearly

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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 in
accordance with safe and sound banking practices.
(g)    Each Borrower Party agrees to maintain the confidentiality of the terms
of this Agreement, provided that such Borrower Party may disclose such terms (i)
to its Affiliates, direct or indirect equity holders and underwriters, and its
or any such Person's directors, officers, employees and agents, including
accountants, legal counsel and other advisors (it being understood that the
Persons to whom such disclosure is made will be informed of the confidential
nature of such terms and the Borrowers will procure such Person's compliance
with this Section 9.08(b)), (ii) in SEC securities filings or to the extent
otherwise required by applicable Legal Requirements or by any subpoena or
similar legal process, (iii) to any other party hereto, (iv) in connection with
any action or proceeding related to this Agreement or any other Credit Facility
Document or the enforcement of rights hereunder or thereunder, (v) with the
consent of the Administrative Agent, (vi) to the extent such terms become
publicly available other than as a result of a breach by any Borrower Party of
this Section 9.08(b), and (vii) to any potential Lender, other potential
provider of Debt permitted under Section 6.02 or potential purchaser of all or
any substantial part of the business of the Borrower Parties and their
Subsidiaries which agrees (subject to customary time limitations) to hold such
terms subject to a duty of confidentiality materially similar to the terms of
this Section 9.08(b).
(h)    The obligations under this Section 9.08 shall survive the termination of
the Commitments and repayment of the Obligations for a period of one (1) year.
Section 9.09    Execution in Counterparts. This Agreement may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and all of
which taken together shall constitute one and the same agreement.
Section 9.10    Survival of Representations, etc. All representations and
warranties made hereunder and in any other Credit Facility Document or other
document delivered pursuant hereto or thereto or in connection herewith or
therewith shall survive the execution and delivery hereof and thereof. Such
representations and warranties have been or will be relied upon by the
Administrative Agent and each Lender, regardless of any investigation made by
the Administrative Agent or any Lender or on their behalf and notwithstanding
that the Administrative Agent or any Lender may have had notice or knowledge of
any Default at the time of any Advance, and shall continue in full force and
effect as long as any Advance or any other Obligation hereunder shall remain
unpaid or unsatisfied.
Section 9.11    Severability. If any provision of this Agreement or the other
Credit Facility Documents is held to be illegal, invalid or unenforceable, (a)
the legality, validity and enforceability of the remaining provisions of this
Agreement and the other Credit Facility Documents shall not be affected or
impaired thereby and (b) the parties shall endeavor in good faith negotiations
to replace the illegal, invalid or unenforceable provisions with valid
provisions the economic effect of which comes as close as possible to that of
the illegal, invalid or unenforceable provisions. The invalidity of a provision
in a particular jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction.

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Section 9.12    Governing Law. This Agreement and each of the other Credit
Facility Documents shall be governed by and construed in accordance with the
laws of the State of New York and the applicable laws of the United States of
America.
Section 9.13    SUBMISSION TO JURISDICTION.
(a)    ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY
OTHER CREDIT FACILITY DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW
YORK SITTING IN NEW YORK CITY OR THE COURTS OF THE UNITED STATES FOR THE
SOUTHERN DISTRICT OF NEW YORK, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT,
EACH BORROWER PARTY, THE ADMINISTRATIVE AGENT AND EACH LENDER CONSENTS, FOR
ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE EXCLUSIVE JURISDICTION OF THOSE
COURTS. EACH BORROWER PARTY, THE ADMINISTRATIVE AGENT AND EACH LENDER
IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE
OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT
OF ANY CREDIT FACILITY DOCUMENT OR OTHER DOCUMENT RELATED THERETO. EACH BORROWER
PARTY, THE ADMINISTRATIVE AGENT AND EACH LENDER WAIVES PERSONAL SERVICE OF ANY
SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS
PERMITTED BY THE LAW OF SUCH STATE.
(b)    Nothing in this Section 9.12 shall affect the right of the Administrative
Agent or any other Lender to serve legal process in any other manner permitted
by law or affect the right of the Administrative Agent or any Lender to bring
any action or proceeding against any Borrower Party (as a Borrower or as a
Guarantor) in the courts of any other jurisdiction.
Section 9.14    WAIVER OF JURY TRIAL. The Borrowers hereby expressly and
irrevocably waives any right to trial by jury of any claim, demand, action or
cause of action arising under any Credit Facility 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 Credit Facility 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 each Borrower hereby
agrees and consents 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 with any court as
written evidence of the consent of the signatories hereto to the waiver of their
right to trial by jury.
Section 9.15    USA PATRIOT Act Notification. Administrative Agent (for itself
and not on behalf of any Lender) and each Lender hereby notifies Borrower that
pursuant to the requirements of the USA PATRIOT Act, it is required to obtain,
verify and record certain information and documentation that identifies each
Borrower Party, which information includes the name and address of such Borrower
Party and such other information that will allow Administrative Agent or such
Lender, as applicable, to identify Borrower in accordance with the USA PATRIOT
Act.
Section 9.16    Notice to Debtor; Entire Agreement.

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(a)    THIS WRITTEN AGREEMENT AND THE OTHER CREDIT DOCUMENTS ARE THE FINAL
EXPRESSION OF THE AGREEMENT BETWEEN THE PARTIES. THIS WRITTEN AGREEMENT AND THE
OTHER CREDIT DOCUMENTS MAY NOT BE CONTRADICTED BY EVIDENCE OF ANY PRIOR ORAL
AGREEMENT OR OF ANY CONTEMPORANEOUS ORAL AGREEMENT BETWEEN THE PARTIES. ANY AND
ALL SUCH PRIOR OR CONTEMPORANEOUS ORAL AGREEMENTS ARE EXPRESSLY SUPERSEDED BY
THIS WRITTEN AGREEMENT AND THE OTHER CREDIT DOCUMENTS.
(b)    THE PARTIES TO THIS AGREEMENT HEREBY ACKNOWLEDGE AND AFFIRM THAT NO
UNWRITTEN ORAL AGREEMENT BETWEEN THE PARTIES EXISTS.
[Remainder of this page intentionally left blank. Signature pages to follow.]

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.
BORROWER:
HORSEHEAD CORPORATION
                    

By:    /s/ James S. Hensler
Name:    James S. Hensler
Title:    President & CEO

THE INTERNATIONAL METALS RECLAMATION COMPANY, LLC
                    

By:    /s/ James S. Hensler
Name:    James S. Hensler
Title:    President & CEO

HORSEHEAD METAL PRODUCTS, LLC
                    
By:    /s/ James S. Hensler
Name:    James S. Hensler
Title:    President & CEO

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MACQUARIE BANK LIMITED,
as Administrative Agent, and as a Lender

By:    /s/ Patrick Murphy
Name:    Patrick Murphy
Title:    Division Director MacQuarie Bank Limited

By:    /s/ Andrew Douglas Harding
Name:    Andrew Douglas Harding
Title:    Executive Director

[SIGNATURE PAGE TO CREDIT AGREEMENT]
     
   
  

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