Exhibit 10.1




AGREEMENT




This

Agreement (as it may be amended, modified or supplemented from time to time in

accordance with the terms hereof, this “Agreement”),

dated as of October 27, 2002, is entered into by and among Cherokee

International, LLC, a California limited liability company (“Cherokee LLC”), Cherokee International

Corporation (formerly, Cherokee International Finance, Inc.), a Delaware

corporation (“Cherokee Corporation,”

and, together with Cherokee LLC, the “Original

Issuers”), each of the persons listed on the signature pages hereto

under the caption “Oaktree Noteholders” (each, an “Oaktree Noteholder”) and each of the persons listed on the

signature pages hereto under the caption “GSC Noteholders” (each, a “GSC Noteholder”; each Oaktree Noteholder or

GSC Noteholder sometimes being referred to herein as a “Consenting Noteholder,” and collectively,

the “Consenting Noteholders”).  Each of the Consenting Noteholders is a

holder of the Original Issuers’ 10 1/2% Senior Subordinated Notes due 2009 (the

“Existing Notes”) issued pursuant

to an Indenture, dated as of April 30, 1999 (the “Existing Indenture”), by and among the Original Issuers and

U.S. Bank, N.A. (f/k/a Firstar Bank of Minnesota, N.A.), as Trustee (the “Existing Trustee”).  Capitalized terms used but not defined

herein shall have the respective meanings ascribed to such terms in the

Existing Indenture.  In connection with

and prior to consummation of the Exchange Offer (defined below), Cherokee LLC intends

to reorganize as a corporation under the laws of the State of Delaware by

merging with and into Cherokee Corporation. 

References herein to Cherokee shall refer (i) collectively to the

Original Issuers so long as they are both in existence and (ii) to Cherokee

Corporation upon consummation of the reorganization.




R 

E  C  I 

T  A  L 

S




WHEREAS,

Cherokee believes it is necessary to reduce the cash flow and covenant burdens

imposed by the Existing Notes and its existing Credit Agreement, dated as of

April 30, 1999, among Cherokee LLC, as borrower, and the agents and lenders

named therein, as amended through the date hereof (the “Credit Agreement”);




WHEREAS,

Cherokee and the Consenting Noteholders have engaged in good faith negotiations

with the objective of reaching a mutually acceptable agreement for the exchange

of the Existing Notes for any one of the following: (i) units (the “Units”), consisting of 5 1/4% Senior Notes

due 2008 to be issued by Cherokee Corporation (the “New Senior Notes”) and warrants (the “Warrants”) to purchase shares of common

stock of Cherokee Corporation (the “Warrant

Shares”) each having terms substantially as set forth on Annex A-1

hereto, which is incorporated into this Agreement as if fully set forth herein,

or (ii) 12% Pay-In-Kind 




 





























 




Senior Convertible Notes due 2008 to be issued by Cherokee

Corporation (the “New Convertible Notes”

and, together with the Units, the New Senior Notes and the Warrants, the “Securities”), which will be convertible

into shares of common stock of Cherokee Corporation (the “Conversion Shares”) having terms

substantially as set forth on Annex A-2 hereto, which is incorporated into this

Agreement as if fully set forth herein, which shall be consummated pursuant to

the Exchange Offer;




WHEREAS, in

connection with the Exchange Offer, Cherokee desires to conduct the Consent

Solicitation (defined below), pursuant to which it will seek to obtain consents

to certain proposed amendments to the Existing Indenture;




WHEREAS, in

connection with and as a condition to the Exchange Offer, Cherokee intends to

(a) amend and restate its Credit Agreement in accordance with terms

substantially as set forth on Annex A-3 hereto, which is incorporated into this

Agreement as if fully set forth herein (the “Amendment”),

and (b) refinance a portion of the indebtedness outstanding under the Credit

Agreement pursuant to a term loan having terms substantially as set forth on

Annex A-4 hereto (the “Term Loan”)

(Annexes A-1, A-2, A-3 and A-4 collectively referred to herein as the “Term Sheet”);




WHEREAS,

the Consenting Noteholders desire to tender their Existing Notes in the

Exchange Offer and consent to the proposed amendments in the Consent

Solicitation (the Exchange Offer and the Consent Solicitation collectively, the

“Exchange Transactions”), on the

terms and subject to the conditions set forth herein;




WHEREAS the

Oaktree Noteholders (the “Equity Holders”)

hold a substantial portion of the outstanding equity interests in Cherokee LLC

and, upon Cherokee LLC’s reorganization as Cherokee Corporation, will hold a

substantial portion of the outstanding shares of common stock of Cherokee

Corporation and desire to have Cherokee effect the Exchange Transactions; and




WHEREAS, to

expedite and implement the Exchange Transactions, (i) Cherokee is prepared to

propose the Exchange Transactions, to seek the necessary approvals for the

Exchange Transactions and the other transactions contemplated thereby as

expeditiously as possible, and to perform its other obligations hereunder, and

(ii) the Consenting Noteholders are prepared to commit, on the terms and

subject to the conditions of this Agreement and applicable law, to exchange

their Existing Notes when solicited to do so and to perform their other

obligations hereunder, including delivering their consent in the Consent

Solicitation.




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NOW,

THEREFORE, in consideration of the foregoing recitals and the terms and

conditions set forth herein, and for other good and valuable consideration, the

receipt and sufficiency of which are hereby acknowledged, Cherokee, Cherokee

Finance and each Consenting Noteholder (each a “Party” and, collectively, the “Parties”), intending to be legally bound, hereby agree as

follows:




1.     Exchange Offer and

Consent Solicitation.




(a)           Exchange Offer.  Cherokee shall conduct an exchange offer in

accordance with the terms hereof, in which Cherokee shall offer to the holders

of the Existing Notes the opportunity to exchange the Existing Notes for (i)

the Units or (ii) the New Convertible Notes, at the election of the holder of

the Existing Notes (the “Exchange Offer”),

each of which shall be delivered to the holders of the Existing Notes on the

Closing Date (as defined below).  The

Securities issued in the Exchange Offer shall have terms substantially as set

forth on Annexes A-1 and A-2 hereto. 

In the Exchange Offer, Cherokee shall offer to exchange, for each $1,000

principal amount of Existing Notes held by a holder thereof, at the option of

that holder, any one of the following (the “Consideration”),

but not a combination thereof:




(i)                    1  Unit, consisting of $1,000 principal amount of New Senior

Notes and 1 Warrant to purchase initially between 119.3995 and 183.7512 Warrant

Shares, determined as provided below; or




(ii)                   $1,000 principal amount of

New Convertible Notes, which will be convertible into a number of Conversion

Shares that will vary depending upon the number of Units issued in the Exchange

Offer (which shall not exceed 30,903,646 shares in the aggregate), determined

as provided below.




The number of Warrant Shares

initially issuable upon exercise of each Warrant will vary depending upon the

aggregate principal amount of Existing Notes tendered and accepted in exchange

for Units in the Exchange Offer, and no more than 11,939,951 Warrant Shares

will be initially issuable in the aggregate. 

Accordingly, if $22  million

or less in aggregate principal amount of Existing Notes is tendered and

accepted in exchange for Units, 183.7512 Warrant Shares will be initially

issuable upon exercise of each Warrant. 

If $79 million or more in aggregate principal amount of Existing Notes

is tendered and accepted in exchange for Units, 119.3995 Warrant Shares will be

initially issuable upon exercise of each Warrant, and if between $22 million

and $79 million in aggregate principal amount of Existing Notes is tendered and

accepted in exchange for Units, the number of Warrant Shares initially issuable

upon exercise of each Warrant shall be adjusted pro




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 rata between

183.7512 and 119.3995 Warrant Shares. 

The number of Warrant Shares issuable upon exercise will be adjusted for

certain dilutive events.




Similarly, the number of

Conversion Shares initially issuable upon conversion of each $1,000 principal

amount of New Convertible Notes also will vary depending upon the aggregate

principal amount of Existing Notes tendered and accepted in exchange for Units

in the Exchange Offer, and no more than 30,903,646 Conversion Shares will be

initially issuable in the aggregate. 

Accordingly, if all holders of Existing Notes exchange their Existing

Notes for an aggregate of $100,000,000 principal amount of New Convertible

Notes, 309.0365 Conversion Shares will be initially issuable upon conversion of

each $1,000 principal amount of New Convertible Notes.  The number of Conversion Shares initially

issuable upon conversion of each $1,000 principal amount of New Convertible

Notes will increase pro rata as

the aggregate principal amount of New Convertible Notes issued in the Exchange

Offer decreases.  Accordingly, if, as

assumed herein, $43,550,000 aggregate principal amount New Convertible Notes

and $56,450,000 aggregate principal amount of New Senior Notes are issued in

exchange for Existing Notes, then 541.9853 Conversion Shares will be initially

issuable upon conversion of each $1,000 principal amount of New Convertible

Notes, or an aggregate of 23,603,458 Conversion Shares.  The number of Conversion Shares issuable

upon conversion will be adjusted for certain dilutive events.




In addition, on the Closing

Date, Cherokee will pay interest, in cash, to holders of Existing Notes

tendered and accepted for exchange in the Exchange Offer that was due to such

holders on November 1, 2002.  Payment of

any interest that has accrued since November 1, 2002 on Existing Notes tendered

and accepted in exchange for New Senior Notes or New Convertible Notes, as

applicable, will be paid on the next regularly scheduled interest payment date,

which is May 1, 2003 for the New Senior Notes and November 1, 2003 for the New

Convertible Notes, at the rate applicable to the New Senior Notes and New

Convertible Notes, respectively. 

Cherokee also will pay, on the Closing Date, interest, in cash, on

Existing Notes not tendered or accepted for exchange in the Exchange Offer that

was due to such holders on November 1, 2002. 

Payment of any interest that has accrued since November 1, 2002 on such

non-tendered or non-accepted Existing Notes will be paid on the next regularly

scheduled interest payment date, which is May 1, 2003, at the rate applicable

to the Existing Notes.




(b)           Consent Solicitation; Supplemental

Indenture.  As part of the Exchange

Offer, Cherokee shall solicit the consent (the “Consent Solicitation”) of the holders of record or beneficial

owners of Existing Notes as of the close of business on September 12, 2002 (the

“Record Date”) to amendments to

certain 




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provisions

of the Existing Indenture (the “Proposals”),

which Proposals are set forth in, and shall be effected by, a supplemental

indenture (the “Supplemental Indenture”),

substantially in the form attached hereto as Annex B.  In the Exchange Offer, exchanging holders of

Existing Notes shall be required, as a condition to Cherokee’s acceptance of

such holders’ tender of Existing Notes in the Exchange Offer, to consent to

each of the Proposals or, if such holders were not holders of record or

beneficial owners of such Existing Notes as of the Record Date, to deliver a

consent to the Proposals with respect to such tendered Existing Notes from the

holder of record or beneficial owner thereof as of Record Date.




(c)           Preparation of Exchange Offer

Documents; Commencement of Exchange Offer. 

Promptly upon execution of this Agreement, Cherokee shall prepare all

documents necessary to commence, effect and consummate the Exchange

Transactions as contemplated by this Agreement (collectively, the “Exchange Offer Documents”).  As soon as reasonably practicable after

preparation of the Exchange Offer Documents, Cherokee shall commence the

Exchange Offer and the Consent Solicitation.




(d)           Cooperation.  Cherokee, on the one hand, and each of the

Consenting Noteholders, on the other hand, shall cooperate with each other and

use (and Cherokee shall cause its subsidiaries to use) its respective reasonable

efforts to take or cause to be taken all actions, and do or cause to be done

all things, necessary, proper or advisable on its part to consummate and make

effective the Exchange Transactions and the other transactions contemplated

thereby, including preparing and filing as promptly as practicable all

documentation to effect all necessary notices, reports and other filings and to

obtain as promptly as practicable all consents, registrations, approvals,

permits and authorizations necessary or advisable to be obtained from any third

party and/or any federal, state or other government, governmental or regulatory

agency or body, court or self-regulatory organization, domestic or foreign

(each, a “Governmental Entity”) in

order to consummate the Exchange Transactions or any of the other transactions

contemplated by the Exchange Offer Documents.




(e)           Support of Equity Holders.  The Equity Holders hereby agree to (i) use

their reasonable efforts to cause Cherokee to comply with its obligations under

this Agreement and (ii) to the extent the Equity Holders’ approval or consent

of the Exchange Transactions is required, grant such approval or consent in a

timely manner.




(f)            Compliance with Securities Laws.  Cherokee and the Consenting Noteholders

agree that the Exchange Offer is intended to conform with the 




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requirements

of Section 3(a)(9) of the Securities Act of 1933, as amended (the “Securities

Act”), and Rule 150 adopted thereunder, and the applicable provisions of

Section 14(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Regulation 14E adopted

thereunder, and all other applicable federal and state securities laws.




(g)           Closing.  The closing of the Exchange Offer and

Consent Solicitation (the “Closing”)

shall take place (i) at the offices of Skadden, Arps, Slate, Meagher & Flom

LLP, New York, New York at 10:00 A.M. on the first business day on which the

last to be fulfilled or waived of the conditions to the Exchange Transactions

set forth in Section 2 (other than in each case those conditions that by their

nature are to be satisfied at the Closing, but subject to the fulfillment or

waiver of those conditions) shall be satisfied or waived in accordance with

this Agreement or (ii) at such other place and time and/or on such other date

as Cherokee and the Consenting Holders may agree in writing (either such time,

the “Closing Date”).




2.     Conditions to the

Exchange Transactions.  The

obligations of the Parties to consummate the Exchange Transactions are subject

to satisfaction or waiver of the following conditions:




(a)           Requisite Consents Condition.  Cherokee shall have timely received validly

delivered consents to the Proposals from holders of not less than a majority in

aggregate principal amount of Existing Notes outstanding on the Record Date

(other than Existing Notes held on the Record Date by Cherokee or its

Affiliates).




(b)           Minimum Tender Condition.  Not less than 51% in aggregate outstanding

principal amount of Existing Notes shall have been validly and timely tendered

and not properly withdrawn in the Exchange Offer.




(c)           Credit Agreement Amendment.  The Amendment shall have been executed and

delivered by the lenders party thereto.




(d)           Term Loan.  The Term Loan shall have been executed and

delivered by the lenders party thereto.




(e)           Outside Closing Date.  The Exchange Offer shall have been

consummated on or prior to December 31, 2002 (the “Outside Closing Date”).




(f)            Blue Sky.  Cherokee shall have received all state

securities and “blue sky” permits and approvals, if any, necessary to

consummate the Exchange Transactions.




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(g)           No Restrictions.  No Governmental Entity of competent

jurisdiction shall have enacted, issued, promulgated, enforced or entered any

statute, law, ordinance, rule, regulation, judgment, decree, injunction or

other order (whether temporary, preliminary or permanent) that is in effect and

restrains, enjoins or otherwise prohibits consummation of the Exchange

Transactions.




3.     Agreements of Consenting

Noteholders in Connection With the Exchange Transactions. 




(a)           Each of the Consenting Noteholders

hereby agrees, subject to the conditions that, and only for so long as, (i) the

material terms of the Exchange Offer Documents are substantially identical to

the terms set forth in this Agreement and the Term Sheet, and (ii) no

Noteholders Termination Event (as defined below) shall have occurred with

respect to it and not have been waived in accordance herewith:




(i)                    it shall validly and timely

tender all of its Existing Notes held of record or beneficially owned by it as

of the date of this Agreement, and any Existing Notes acquired by such

Consenting Noteholder after the date of this Agreement, for exchange pursuant

to the Exchange Offer, and accept in exchange therefor Units, New Convertible

Notes or the Cash Election, as set forth opposite such Consenting Noteholder’s

name on Schedule I hereto;




(ii)                   it shall validly and timely

deliver consents to (and, upon request of Cherokee shall cause its nominee to

consent to) the Proposals with respect to all of its Existing Notes held of

record or beneficially owned by it as of the Record Date, and, with respect to

any Existing Notes held of record or beneficially owned by it as of the date of

this Agreement or acquired by such Consenting Noteholder after the date of this

Agreement that were not so held or owned as of the Record Date, it shall

validly and timely deliver the consent of the record or beneficial owner of

such Existing Notes as of the Record Date, pursuant to the Consent Solicitation

and in accordance with the terms hereof;




(iii)                  it shall not object to the

consummation of the Exchange Transactions or otherwise commence any proceeding

to oppose, or that could materially adversely affect or materially delay, the

Exchange Transactions or the use of any of the Exchange Offer Documents in

connection therewith;




(iv)                  it shall agree to and shall

execute execution versions of the Exchange Offer Documents to which it is party

and containing terms and conditions substantially identical to those contained

in this Agreement and the Term Sheet;




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(v)                   it shall execute agreements

setting forth the stockholder arrangements contained in the Term Sheet




(vi)                  it shall not vote for, consent

to, or directly or indirectly seek, solicit, support, participate in or

encourage any other exchange of the Existing Notes, or any restructuring or

recapitalization of Cherokee, or any plan of reorganization or liquidation

under applicable bankruptcy or insolvency laws, whether domestic or foreign, in

respect of Cherokee, or any plan, proposal or offer of dissolution, winding up,

liquidation, reorganization, merger, recapitalization or restructuring of

Cherokee (other than as described in the Exchange Offer Documents (including

Cherokee LLC’s reorganization into a Delaware corporation), in connection with

the amendment or refinancing of the Credit Agreement on terms acceptable to

Cherokee or one agreed to in writing by Cherokee and each of the Consenting

Noteholders); and




(vii)                 it shall not take any other

action (and shall prevent its nominee from taking any action on its behalf),

including but not limited to initiating any legal proceeding, that is

materially inconsistent with, or that could materially delay consummation of,

any of the Exchange Transactions.




(b)           Upon request of Cherokee, each

Consenting Noteholder agrees:




(i)                    to the extent permitted

under the Existing Indenture, to waive (and, upon request of Cherokee, shall

cause its nominee to waive) any Default or Event of Default arising after the

date of this Agreement under the Existing Indenture through the earlier of

consummation of the Exchange Offer or termination of this Agreement in

accordance with the provisions hereof; or




(ii)                   in the event that any

acceleration of the Existing Notes is effected pursuant to Section 6.02 of the

Existing Indenture as a result of any Event of Default, to vote (and, upon

request of Cherokee, shall cause its nominee to vote) pursuant to Section 6.02

of the Existing Indenture to rescind such acceleration and its consequences and

that all such rescissions of acceleration shall include instructions to the

Existing Trustee under the Existing Indenture to such effect.




4.     Agreements of Cherokee

in Connection with the Exchange Transactions.




(a)           Cherokee hereby agrees that (i)

promptly upon execution of this Agreement by all Parties, to prepare all of the

Exchange Offer Documents in a timely fashion in accordance with the terms of

this Agreement, (ii) to ensure that all of the Exchange Offer Documents contain

terms and conditions substantially identical to 




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those

contained in this Agreement and the Term Sheet, (iii) to use its reasonable

efforts to obtain any and all requisite material regulatory and/or material

third party approvals for the Exchange Transactions and (iv) to execute and

deliver any documents, agreements or instruments necessary to effectuate the

Exchange Transactions.




(b)           Cherokee also shall keep the

Consenting Noteholders apprised of the status of matters relating to completion

of the Exchange Transactions and the other transactions contemplated thereby,

including promptly furnishing the Consenting Noteholders with copies of (i) any

amendments or supplements to any of the Exchange Offer Documents in advance of

any mailing to holders of Existing Notes and (ii) any notice or other material

communications received by Cherokee from any Governmental Entity with respect

to the Exchange Transactions and the other transactions contemplated thereby.




5.     Termination.




(a)           Termination of the Obligations of

the Consenting Noteholders.  Upon

the occurrence of any of the events set forth below (each, a “Noteholder Termination Event”), each of the

Consenting Noteholders may terminate its obligations hereunder and rescind its

acceptance of the Exchange Offer by giving written notice of such termination

to the other Consenting Noteholders, if any, and Cherokee:




(i)                    the Exchange Offer Documents

provide or are modified to provide for any terms that are materially adverse to

the Consenting Noteholders or materially inconsistent with any of the material

terms or conditions of this Agreement or the Term Sheet;




(ii)                   Cherokee materially breaches

this Agreement or fails to satisfy in any material respect any of the terms or

conditions of this Agreement or the Term Sheet;




(iii)                  the Exchange Offer has not

been consummated on or prior to the Outside Closing Date;




(iv)                  Cherokee shall file a petition

or commence a proceeding under any provision of any applicable bankruptcy or

insolvency laws, whether state, federal or foreign (collectively, “Bankruptcy

Laws”);




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(v)                   any person shall file a

petition or commence a proceeding against Cherokee under any provision of any

applicable Bankruptcy Law;




(vi)                  Cherokee shall withdraw or

revoke the Exchange Offer, or Cherokee shall publicly announce its intention

not to pursue the Exchange Offer; or




(vii)                 any other Consenting Noteholder

shall have materially breached this Agreement or failed to satisfy in any

material respect any of the terms or conditions of this Agreement, which breach

shall not have been cured within 3 days after receiving notice thereof;




(viii)                any order permanently

restraining, enjoining or otherwise prohibiting consummation of any of the

Exchange Transactions shall become final and non-appealable;




(ix)                   there shall exist any action,

proceeding, claim or counterclaim by any Governmental Entity (other than any action,

proceeding, claim or counterclaim by the Party seeking to terminate its

obligations hereunder), before any court, authority, agency or tribunal that

challenges the Exchange Offer or the Consent Solicitation or any related

transactions contemplated hereby which, if decided adversely to Cherokee or any

other Party, would reasonably be expected to prohibit, prevent, restrict, limit

or delay consummation of the Exchange Offer, the Consent Solicitation or any

such related transactions; or




(x)                    any of the representations

and warranties of Cherokee contained herein that are qualified as to

materiality shall not be true and correct, and any representations and

warranties that are not so qualified shall not be true and correct in all

material respects, in each case on and as of the Closing Date, except that

those representations and warranties that speak only as of a specific date need

only be true as of such specified date;




provided, that the

right to terminate this Agreement pursuant to this Section 5(a) shall not be

available (1) to any party if it or any Noteholder Affiliate (as defined below)

of such party has breached in any material respect its obligations under this

Agreement in any manner, which breach shall have proximately contributed to the

occurrence of the failure of the Exchange Transactions to be consummated, or

(2) to any Oaktree Noteholder based on a Noteholder Termination Event described

in clause (ii), (vi) or (x) above.  For

purposes hereof, a “Noteholder Affiliate” of (x) any GSC Noteholder shall be

any other GSC Noteholder and of (y) any Oaktree Noteholder shall be Cherokee or

any other Oaktree Noteholder.




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(b)           Termination of the Cherokee’s

Obligations. Upon the occurrence of any of the events set forth below,

Cherokee shall have the right to terminate this Agreement by the giving of

written notice of such termination to each of the Consenting Noteholders:




(i)                    any GSC Noteholder

materially breaches this Agreement or fails to satisfy in any material respect

any of the terms or conditions of this Agreement;




(ii)                   the Exchange Offer has not

been consummated on or prior to the Outside Closing Date;




(iii)                  any order permanently

restraining, enjoining or otherwise prohibiting consummation of any of the

Exchange Transactions shall become final and non-appealable;




(iv)                  there shall exist any action,

proceeding, claim or counterclaim by any Governmental Entity (other than any

action, proceeding, claim or counterclaim by the Party seeking to terminate its

obligations hereunder), before any court, authority, agency or tribunal that

challenges the Exchange Offer or the Consent Solicitation or any related

transactions contemplated hereby which, if decided adversely to Cherokee or any

other Party, would reasonably be expected to prohibit, prevent, restrict, limit

or delay consummation of the Exchange Offer, the Consent Solicitation or any

such related transactions; or




(v)                   any of the representations

and warranties of any Consenting Noteholder contained herein that are qualified

as to materiality shall not be true and correct, and any representations and

warranties that are not so qualified shall not be true and correct in all

material respects, in each case on and as of the Closing Date, except that

those representations and warranties that speak only as of a specific date need

only be true as of such specified date;




provided, that the right to

terminate this Agreement pursuant to this Section 5(b) shall not be available

to Cherokee if it or any Oaktree Noteholder has breached in any material

respect its obligations under this Agreement in any manner which breach shall

have proximately contributed to the occurrence of the failure of the Exchange

Transactions to be consummated.




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(c)           Mutual Termination.  This Agreement may be terminated by mutual

written agreement of Cherokee and the Consenting Noteholders.




(d)           Effects of Termination.  Except for clauses (f) and (p) of Section 11

hereof, upon the termination of the obligations of a Consenting Noteholder

pursuant to Section 5(a) hereof (such Consenting Noteholder whose obligations

have been so terminated, an “Excluded

Noteholder”), this Agreement shall terminate with respect to such

Excluded Noteholder and all of the rights and obligations under this Agreement

of such Excluded Noteholder and of all of the other Parties in respect of such

Excluded Noteholder shall become null and void and of no further force or

effect, and there shall be no liability or obligation hereunder of such

Excluded Noteholder or of any of the other Parties in respect of any such

Excluded Noteholder.  Except for clauses

(f) and (p) of Section 11 hereof, upon the termination of this Agreement

pursuant to Section 5(b) or 5(c) hereof, this Agreement shall become null and

void and of no further force or effect, and there shall be no liability or

obligation hereunder of any nonbreaching Party in respect of any of the other

Parties.  It is expressly understood and

agreed that if this Agreement is terminated pursuant to Section 5(b) or 5(c)

hereof, Cherokee shall have no obligation to commence, effect or consummate the

Exchange Offer or the Consent Solicitation, and none of the Parties shall have

any obligation to consummate any of the Exchange Transactions or any of the

transactions contemplated thereby.  In

the event of a termination of the obligations of a Consenting Noteholder

pursuant to Section 5(a) hereof or a termination of this Agreement pursuant to

Section 5(b) or 5(c) hereof, each Party shall have all of the rights and

remedies available to it under applicable law and/or the Existing Indenture,

and any ancillary documents or agreements thereto, including under this

Agreement.  Notwithstanding anything in

this Section 5(d), no such termination of the obligations of a Consenting

Noteholder pursuant to Section 5(a) hereof or termination of this Agreement

pursuant to Section 5(b) or 5(c) hereof shall relieve any Party from liability

for any breach or non-performance of its obligations hereunder prior to the

date of such termination.




6.     Forbearance;

Restrictions on Transfers and Liens. 

Each Consenting Noteholder, so long as the obligations of such

Consenting Noteholder have not been terminated pursuant to Section 5 hereof,

agrees that:




(a)           it shall not file a notice of default

or sale or take any other action to collect on the Existing Notes, including,

without limitation, instructing the Existing Trustee on how to proceed in the

exercise of any and all remedies;




(b)           it shall give instructions to the

Existing Trustee, if and when reasonably appropriate, to desist from taking

action that is inconsistent with this 




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Agreement

or the Exchange Transactions, so long as no indemnity of such Consenting

Noteholder is required for such action to be taken by the Existing Trustee;




(c)           it shall not, directly or indirectly,

sell, assign, transfer, hypothecate or otherwise dispose of (1) any of the

Existing Notes owned beneficially or of record by such Consenting Noteholder or

as to which such Consenting Noteholder has investment authority or discretion

(including any of the Existing Notes acquired after the date hereof), or grant

any proxies to any person in connection with such Existing Notes, (2) any claim

(as that term is defined in Section 101(5) of the Bankruptcy Law) arising from,

based on or related to the Existing Notes, or (3) any option, interest in, or

right to acquire any of the Existing Notes or claim referred to in clauses (1)

and (2) above, unless (x) the transferee thereof agrees in writing for the

benefit of the other Parties to be bound by all of the terms of this Agreement

and executes a counterpart signature page of this Agreement and the transferor

provides Cherokee with a copy thereof, and (y) the transferor delivers to such

transferee at the time of such transfer a consent to the Proposals with respect

to the Existing Notes so transferred that were held of record or beneficially

owned by the transferor as of the Record Date, in which event each Party shall

be deemed to have acknowledged that its obligations to the Consenting

Noteholders hereunder shall be deemed to constitute obligations in favor of

such transferee and shall be deemed to have made the representations and

warranties contained in Section 7 hereof; and




(d)           shall not encumber any Existing Notes

with any Lien.




7.     Representations and

Warranties of the Parties.  Each of

the Parties represents and warrants to each of the other Parties, as of the

date hereof, as follows:




(a)           Power, Authority and Authorization.  Such Party has all requisite power and

authority to execute and deliver this Agreement, to perform its obligations

under this Agreement and to consummate the Exchange Transactions. The

execution, delivery and performance of this Agreement and the consummation of

the Exchange Transactions have been duly authorized by all necessary action

(corporate or other) on the part of such Party, and the person executing this

Agreement on behalf of such Party is duly authorized to do so.




(b)           Binding Obligation.  This Agreement has been validly executed and

delivered by such Party and is the legal, valid and binding obligation of such

Party, enforceable against such Party in accordance with its terms, except as

enforcement may be limited by bankruptcy, insolvency or other similar laws,

both foreign and 




13





























 




domestic,

relating to or limiting creditors’ rights generally or by equitable principles

relating to enforceability.




(c)           No Conflicts.  None of the execution, delivery or

performance of this Agreement, nor the compliance with the terms and provisions

hereof, nor the consummation of any of the Exchange Transactions, shall

conflict with, violate, or constitute a breach of or a default (with the

passage of time or otherwise) under, (i) any law, statute, rule, regulation,

ordinance, judgment, decree or order applicable to such Party or any of its

subsidiaries or any of their respective businesses or properties, (ii) such

Party’s organizational documents or those of any of its subsidiaries or (iii)

except to the extent the consummation of the Exchange Transactions require the

approval of the lenders under the Credit Agreement, any contractual obligations

to which such Party or any of its subsidiaries is a party or by which such

Party, any of its subsidiaries or any of their respective properties are bound,

except in each case, for such conflicts, violations, breaches or defaults that

would not reasonably be expected to have, individually or in the aggregate, a material

adverse effect on the business, assets, operations, property or financial

condition of such Party and its subsidiaries.




(d)           Governmental Consents.  No permit, certificate, authorization,

approval, consent, license or order of, or filing, registration, declaration or

qualification with, or notice to, any Governmental Entity or arbitrator is

required in connection with, or as a condition to, the execution, delivery and

performance of this Agreement, the compliance with any of the terms and

provisions hereof or the consummation of any of the Exchange Transactions,

except for (i) such filings as may be required by the Securities and Exchange

Commission or pursuant to state securities or “blue sky” laws, (ii) the

qualification of the indentures governing the New Senior Notes, the New

Convertible Notes and the Existing Notes under the Trust Indenture Act of 1939,

as amended, and (iii) such permits, certificates, authorizations, approvals,

consents, licenses or orders of, or filings, registrations, declarations or

qualifications with, or notices that would not reasonably be expected to have,

individually or in the aggregate, a material adverse effect on the business,

assets, operations, property or financial condition of such Party and its

subsidiaries.




(e)           No Proceedings.  There is no action, claim, suit, demand,

hearing, notice of violation or deficiency, or proceeding (including, without

limitation, any investigation or partial proceeding, such as a deposition),

domestic or foreign, pending, or to the knowledge of such Party threatened,

against or that affects such Party that would reasonably be expected to prevent

the consummation of or materially impair or materially delay any of the

Exchange Transactions.




14





























 




(f)            Representation by Counsel.  Each Party acknowledges that it has been

represented by counsel (or had the opportunity to be represented by counsel and

waived its right to such representation) in connection with this Agreement,

including the negotiation of this Agreement, and the Exchange Transactions,

including with respect to tax matters. 

Accordingly, any rule of law or any legal decision that would provide

any Party with a defense to the enforcement of the terms of this Agreement

against such Party based upon lack of legal counsel shall have no application

and is expressly waived by such Party.




8.     Additional

Representations and Warranties of the Consenting Noteholders.  Each Consenting Noteholder represents and

warrants to the other Parties as follows:




(a)           Such Consenting Noteholder is

acquiring the Securities it elects to receive in the Exchange Offer (the “Applicable Securities”) for its own account

for investment only and not with a view to, or for resale in connection with,

any public sale or distribution thereof. 

Such Consenting Noteholder is (A) a “qualified institutional buyer” as

defined in Rule 144A under the Securities Act, or (B) an institutional “accred­it­ed

inves­tor” as defined in sub­para­graph (1), (2), (3) or (7) of Rule 501(a)

under the Securities Act.  Such

Consenting Noteholder has not ac­quired the Existing Notes on behalf, or at the

request, of Cherokee or any of its Affiliates.




(b)           As of the date hereof, such

Consenting Noteholder owns of record and/or beneficially, and/or has investment

authority or discretion with respect to, the aggregate principal amount of

Existing Notes set forth next to such Consenting Noteholder’s name on the

signature pages hereto, and such aggregate principal amount of Existing Notes

constitutes all of the Existing Notes so owned or controlled by such holder and

such Affiliates as of the date hereof, and such Consenting Noteholder or such

Affiliate, as applicable, so owned or controlled such Existing Notes as of the

Record Date and, if not so owned or controlled as of the Record Date, has

received or will obtain prior to the expiration of the Exchange Offer a consent

to the Proposals from the holder who so owned or controlled such Existing Notes

as of the Record Date.




(c)           Such Consenting Noteholder owns the

Existing Notes free and clear of all Liens.




(d)           Such Consenting Noteholder has

adequate informa­tion concerning the businesses, finances and operations, condi­tion

(finan­cial and otherwise), re­sults of opera­tions, prop­er­ties, plans and

pros­pects of Cherokee to make an in­formed decision regarding the sale of the

Existing Notes in exchange for the Applicable Securities and the purchase of

the Applicable Securities in exchange for the Existing 




15





























 




Notes

and has independently and without reliance upon Cherokee made its own analysis

and decision to sell the Existing Notes and purchase the Applicable

Securities.  Such Consenting Noteholder

and its advisors have such knowledge and experience in financial and business

matters that they are capable of evaluating the merits and risks of an

investment in the Applicable Securities, have all information deemed by them to

be necessary or appropriate to evaluate the risks and merits of an investment

in the Applicable Securities, and have received all information requested by

them from Cherokee.  Such Consenting

Noteholder has been afforded the opportunity to ask questions of Cherokee and

has received satisfactory answers to any such inquiries.  Such Consenting Noteholder understands that

its investment in the Applicable Securities involves a high degree of risk.




(e)           The proposed sale of the Existing

Notes in exchange for the Applicable Securities by such Consenting Noteholder

was privately negotiat­ed in an independent transac­tion and was not solicit­ed

by or on behalf of Cherokee or any of its Affiliates.  The terms of this Agreement were the result of negotiations

between such Consenting Noteholder and Cherokee, and such Consenting Noteholder

was given the opportunity to review and comment upon the proposed terms of this

Agreement.




9.     Notices.  All notices and other communications

hereunder shall be in writing and shall be deemed sufficiently given and served

for all purposes when personally delivered or given by telex or

machine-confirmed facsimile or one business day after a writing is delivered to

a national overnight courier service or three business days after a writing is

deposited in the United States mail, first class postage or other charges

prepaid and registered, return receipt requested, addressed as follows (or at

such other address for a Party as shall be specified by like notice):




If to Cherokee, to:




 




Cherokee

International LLC




2841

Dow Avenue




Tustin

, CA 92780




Attention:

Chief Financial Officer




Telephone:

(714) 544-6665




Facsimile: (714) 838-4742




With a copy (which shall not

constitute notice) to:




Jeffrey

H. Cohen, Esq.




Skadden,

Arps, Slate, Meagher & Flom LLP




 




16





























 




 




300

South Grand Avenue, 34th Floor




Los

Angeles, California  90071




Telephone:

(213) 687-5000




Facsimile: (213) 687-5600




If to the Consenting

Noteholders, as specified on Schedule I hereto.




10.   Acknowledgment. This

Agreement and the terms of the Exchange Transactions are the product of private

negotiations between Cherokee and the Consenting Noteholders. This Agreement is

not and shall not be deemed to be a solicitation of consents to amendments to

the Existing Indenture, or waivers of any provision thereof, or a solicitation

to tender or exchange Existing Notes. 

Neither tenders of Existing Notes in the Exchange Offer nor delivery of

consents in the Consent Solicitation will be solicited from any holder of

Existing Notes until such holder has received the Exchange Offer Documents and

any other disclosures required under applicable law.  Notwithstanding anything contained herein to the contrary, the

Consenting Noteholders shall be under no requirement to consent to amendments

to the Existing Indenture or to exchange their Existing Notes, if the Exchange

Offer Documents presented to the Consenting Noteholders provide for any terms

that are materially inconsistent with this Agreement, including, not limited

to, the provisions of the Term Sheet. 

Cherokee acknowledges and agrees that the Existing Indenture and all

instruments and documents executed in connection therewith constitute valid and

binding agreements of Cherokee. 

Cherokee further acknowledges that it is not currently aware of any

claim, counterclaim, setoff or defense of any kind or nature that would in any

way affect the validity or enforceability of any claim of any Consenting

Noteholder arising from the Existing Notes or that would in any way reduce or

affect the absolute and unconditional obligation of Cherokee to pay all of the

obligations arising from the Existing Notes.




11.   Miscellaneous.  




(a)           Further Assurances.  Each of the Parties hereby further covenants

and agrees that it shall take all such further actions as may be reasonably

necessary to carry out the purposes and intent of this Agreement and shall

refrain from taking any action which would frustrate the purposes and intent of

this Agreement.




(b)           Effectiveness; Counterparts.  This Agreement shall not become effective

and binding on the Parties unless and until counterpart signature pages hereto

shall have been executed and delivered by each of the Parties hereto.  This Agreement may be executed by one of

more of the Parties in any number of counterparts, each of which shall be

deemed to be an original, but all such 




17





























 




counterparts

when taken together shall constitute one and the same instrument.  The agreements, representations and

obligations of the Consenting Noteholders under this Agreement are, in all

respects, several and not joint.




(c)           Entire Agreement. This

Agreement constitutes the entire agreement among the Parties with respect to

the subject matter hereof and supersedes all prior negotiations and all prior

agreements and understandings, both written and oral, among the Parties with

respect to the subject matter hereof; provided

that any confidentiality agreement heretofore executed between

Cherokee and any Consenting Noteholder shall continue in full force and effect

(each, a “Confidentiality Agreement”).




(d)           Interpretation.  When a reference is made in this Agreement

to Sections, paragraphs, clauses or Annexes, such reference shall be to a

Section, paragraph or clause of or Annex to this Agreement unless otherwise

indicated.  The words “include”, “includes”, and “including”

when used herein shall be deemed in each case to be followed by the words “without limitation.”  The words “hereof,”

“herein,” “herewith,” “hereby” and “hereunder”

and words of similar import shall, unless otherwise stated, be construed to

refer to this Agreement as a whole and not to any particular provision of this

Agreement.  Unless the context otherwise

requires, defined terms shall include the singular and plural and the

conjunctive and disjunctive forms of the terms defined.  None of the Parties shall have any term or

provision construed against such Party solely by reason of such Party having

drafted the same.




(e)           Specific Performance.  Each of the Parties recognizes and agrees

that if for any reason any of the provisions of this Agreement are not performed

by such Party in accordance with their specific terms or are otherwise

breached, immediate and irreparable harm or injury would be caused to the other

Parties for which money damages would not be an adequate remedy.  Accordingly, each Party agrees that, in

addition to any other available remedies, the Parties shall be entitled to an

injunction restraining any violation or threatened violation of the provisions

of this Agreement without the necessity of any Party posting a bond or other

form of security.  In the event that any

action should be brought in equity to enforce the provisions of this Agreement,

each Party agrees that it will not allege, and each other Party hereby waives

the defense, that there is an adequate remedy at law.




(f)            Indemnification.  Cherokee hereby agrees to indemnify and hold

harmless each Consenting Noteholder, each person, if any, who controls (within

the meaning of Section 15 of the Securities Act or Section 20(a) of the

Exchange Act) any Consenting Noteholder (each, a “controlling person”) and the respective 




18





























 




officers,

directors, partners, employees, representatives and agents of each Consenting

Noteholder and any such controlling person from and against any and all losses,

claims, damages, liabilities and expenses (including, without limitation, costs

and expenses incurred in connection with investigating, preparing, pursuing or

defending against any of the foregoing) actually incurred by such Consenting

Noteholder as a result of any claim, suit, action, proceeding, investigation or

inquiry brought or asserted by any third party against the Consenting

Noteholder arising out of (A) such Consenting Noteholder’s compliance with

Section 3(b)(ii) hereof or (B) any untrue statement or alleged untrue statement

of any material fact contained in any Exchange Offer Document, or any amendment

or supplement thereto, or as a result of the omission or alleged omission to

state therein a material fact necessary in order to make the statements therein,

in the light of the circumstances under which they were made, not misleading; provided, however,

that Cherokee will not be liable in any such case to the extent that any such

loss, claim, damage, liability or expense arises out of or is based upon (x)

with respect to clause (A) above, the gross negligence or willful misconduct of

such Consenting Noteholder and (y) with respect to clause (B) above, any untrue

statement or alleged untrue statement in, or omission or alleged omission from,

any Exchange Offer Document in reliance upon and in conformity with written

information relating to such person furnished to Cherokee by such person

specifically for use therein.




(g)           Assignment; Successors and Assigns.  Neither this Agreement nor any of the

rights, interests or obligations of the Consenting Noteholders under this

Agreement shall be assigned or delegated, in whole or in part, by operation of

law or otherwise by any of the Consenting Noteholders without the prior written

consent of Cherokee.  Neither this

Agreement nor any of the rights, interests or obligations of Cherokee under

this Agreement shall be assigned or delegated, in whole or in part, by

operation of law or otherwise by Cherokee without the prior written consent of

each of the Consenting Noteholders. 

This Agreement has been and is made solely for the benefit of and shall

be binding upon each of the Parties and, to the extent provided in Section

11(f) hereof, the controlling persons, officers, directors, partners,

employees, representatives and agents referred to in such Section 11(f), and

their respective heirs, executors, administrators, successors and assigns, all

as and to the extent provided in this Agreement, and no other person shall

acquire or have any right under or by virtue of this Agreement; provided, however,

that nothing contained in this Section 11(g) shall be deemed to permit sales,

assignments or transfers other than in accordance with Section 6(c) hereof.




(h)           Fees and Expenses.  Except as otherwise provided herein,

Cherokee shall pay all fees, costs and expenses incurred by it on its behalf

and by the Consenting Noteholders in connection with the Exchange Transactions

and the other 




19





























 




transactions

contemplated thereby, including, without limiting the generality of the

foregoing, reasonable fees, costs and expenses of the financial consultants,

accountants and counsel of each of the Consenting Noteholders.  Such fees include the fees of Milbank,

Tweed, Hadley & McCloy LLP and Stroock & Stroock & Lavan LLP.




(i)            No Third Party Beneficiaries.

Unless expressly stated herein, this Agreement shall be solely for the benefit

of the Parties and no other person or entity and is not intended to, and shall

not, confer upon any other person any rights or remedies hereunder.




(j)            Headings.  The headings of the sections, paragraphs and

subsections of this Agreement are inserted for convenience only and shall not

affect the meaning or interpretation of such section, paragraph or subsection

or of this Agreement.




(k)           Further Acquisition of Existing

Notes. Any Consenting Noteholder may acquire additional Existing Notes to

the extent permitted by applicable law; provided,

however, that any such additional

Existing Notes shall be subject to the terms hereof, and each such Consenting

Noteholder shall exchange any such additional Existing Notes, and deliver a

consent to the Proposals from the record holder or beneficial owner as of the

Record Date with respect thereto, in accordance with the terms hereof and for

so long as such Consenting Noteholder is obligated to exchange Existing Notes

in accordance with the terms hereof.




(l)            Amendments and Waivers.  This Agreement may not be modified, amended

or supplemented except in writing signed by Cherokee, not less than a majority

of the then outstanding aggregate principal amount of the Existing Notes held

by the GSC Noteholders and not less than a majority of the then outstanding

aggregate principal amount of the Existing Notes held by the Oaktree

Noteholders.




(m)          GOVERNING LAW.  THIS AGREEMENT SHALL BE CONSTRUED AND

INTERPRETED, AND THE RIGHTS OF THE PARTIES SHALL BE DETERMINED IN ACCORDANCE

WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING WITHOUT LIMITATION, SECTIONS

5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAWS AND RULE 327(b) OF

THE NEW YORK CIVIL PRACTICE LAWS AND RULES. 

EACH OF THE PARTIES HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF

ANY NEW YORK STATE COURT SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW

YORK OR ANY FEDERAL COURT SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF

NEW YORK IN RESPECT OF ANY SUIT, ACTION OR 




20





























 




PROCEEDING

ARISING OUT OF OR RELATING TO THIS AGREEMENT, AND IRREVOCABLY ACCEPTS FOR

ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY,

JURISDICTION OF THE AFORESAID COURTS. 

EACH OF THE PARTIES IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT MAY

EFFECTIVELY DO SO UNDER APPLICABLE LAW, TRIAL BY JURY AND ANY OBJECTION THAT IT

MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH SUIT, ACTION

OR PROCEEDING BROUGHT IN ANY SUCH COURT AND ANY CLAIM THAT ANY SUCH SUIT,

ACTION OR PROCEEDING BROUGHT IN SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT

FORUM.  EACH OF PARTIES IRREVOCABLY

CONSENTS, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW,

TO THE SERVICE OF PROCESS OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH

ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR

CERTIFIED MAIL, POSTAGE PREPAID, AT THE ADDRESS SET FORTH HEREIN, SUCH SERVICE

TO BECOME EFFECTIVE 30 DAYS AFTER SUCH MAILING.  NOTHING HEREIN SHALL AFFECT THE RIGHT OF CHEROKEE TO SERVE

PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS

OR OTHERWISE PROCEED AGAINST ANY OF THE CONSENTING NOTEHOLDERS IN ANY OTHER

JURISDICTION.




(n)           Consideration.  Each of the Parties acknowledges and agrees

that no consideration shall be due, payable or paid to any of the Consenting

Noteholders for their agreement to participate in the Exchange Transactions,

other than the performance by Cherokee of the contractual obligations imposed

upon Cherokee by this Agreement.




(o)           Severability.  If any term, provision, covenant or

restriction of this Agreement is held by a court of competent jurisdiction to

be invalid, illegal, void or unenforceable, the remainder of the terms,

provisions, covenants and restrictions set forth herein shall remain in full

force and effect and shall in no way be affected, impaired or invalidated, and

the Parties shall use their best efforts to find and employ an alternative

means to achieve the same or substantially the same result as that contemplated

by such term, provision, covenant or restriction.  It is hereby stipulated and declared to be the intention of the

Parties that they would have executed the remaining terms, provisions,

covenants and restrictions without including any of such that may be hereafter

declared invalid, illegal, void or unenforceable.




(p)           Confidentiality.  Each Party agrees that this Agreement, the Term

Sheet and the other attachments hereto shall constitute “Confidential

Information” 




21





























 




for

purposes of the Confidentiality Agreements binding on such Party with respect

to information of Cherokee.




[signature pages

follow]




22





























 




                IN WITNESS WHEREOF, each of the Parties has executed

this Agreement as of the date and year first above written.




	

  CHEROKEE INTERNATIONAL, LLC


  
	

   


  
	

  By:


  	

  /s/

  R.V. Holland, Jr.


  
	

   


  	

  Name:


  	

  R.V.

  Holland, Jr.


  
	

   


  	

  Title:


  	

  V.P.

  Finance, CFO


  





 




 




	

  CHEROKEE INTERNATIONAL CORPORATION


  
	

   


  
	

  By:


  	

  /s/

  Ian Schapiro


  
	

   


  	

  Name:


  	

  Ian

  Schapiro


  
	

   


  	

  Title:


  	

  Vice

  President


  





 





























 




	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

  GSC NOTEHOLDERS:.


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

  GSC RECOVERY II, L.P.


  
	

   


  	

   


  
	

   


  	

  By:


  	

  GSC Recovery II GP,

  L.P.,


  its general partner


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

  By:


  	

  GSC RII, LLC,


  its general partner


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

  By:


  	

  GSCP (NJ) Holdings,

  L.P.,


  its sole member


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

  By:


  	

  GSCP (NJ), Inc.,


  its general partner


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

  By:


  	

  /s/

  Robert Hamwee


  
	

   


  	

   


  	

  Name:


  	

  Robert

  Hamwee


  
	

   


  	

   


  	

  Title:


  	

  Managing

  Director


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

  GSC

  RECOVERY IIA, L.P.


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

  By:


  	

  GSC Recovery IIA GP,

  L.P.,


  its general partner


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

  By:


  	

  GSC RIIA, LLC,


  its general partner


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

  By:


  	

  GSCP (NJ) Holdings,

  L.P.,


  its sole member


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

  By:


  	

  GSCP (NJ), Inc.,


  its general partner


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

  By:


  	

  /s/

  Robert Hamwee


  
	

   


  	

   


  	

  Name:


  	

  Robert

  Hamwee


  
	

   


  	

   


  	

  Title:


  	

  Managing

  Director


  
									





 




 





























 




	

  GSC PARTNERS CDO FUND, LIMITED


  
	

   


  	

   


  
	

   


  	

   


  
	

   


  	

   


  
	

  By:


  	

  /s/

  Thomas Libassi


  
	

   


  	

  Name:

  Thomas Libassi


  
	

   


  	

  Title:

  Managing Director


  
	

  


  


  GSC PARTNERS CDO FUND II, LIMITED


  




  
	

  By:


  	

  /s/

  Thomas Libassi


  
	

   


  	

  Name:  Thomas Libassi


  
	

   


  	

  Title:

  Managing Director


  
	

  


  


  OAKTREE NOTEHOLDERS


  
	

  


  OCM/GFI POWER OPPORTUNITIES FUND, L.P.


  




  
	

  By:


  	

  GFI

  Energy Ventures LLC


  
	

   


  	

  its

  General Partner


  
	

   


  	

   


  
	

   


  	

   


  
	

  By:


  	

  /s/

  Ian Shapiro


  
	

   


  	

  Name:

  Ian Schapiro


  
	

   


  	

  Title:

  Chief Financial Officer


  
	

  


  


  OCM PRINCIPAL OPPORTUNITIES FUND, L.P.


  




  
	

  By:


  	

  Oaktree

  Capital Management, LLC


  
	

   


  	

  its

  General Partner


  
	

   


  	

   


  
	

   


  	

   


  
	

  By:


  	

  /s/

  Christopher S. Brothers


  
	

   


  	

  Name:Christopher

  S. Brothers


  
	

   


  	

  Title:

  Managing Director


  
	

   


  	

   


  
	

   


  	

   


  
	

  By:


  	

  /s/

  Michael P. Harmon


  
	

   


  	

  Name:

  Michael P. Harmon


  
	

   


  	

  Title:

  Senior Vice President