Exhibit
10.22


 


BRIGADE CAPITAL
MANAGEMENT, LLC


SENATOR INVESTMENT GROUP
LP


 


August 2, 2010


 


Aventine
Renewable Energy Holdings, Inc.


120
North Parkway Drive


Pekin, Illinois  61554


 


Re:  $50,000,000 Senior Secured Notes


 


Ladies
and Gentlemen:


 


Reference is made to the
Chapter 11 bankruptcy cases, lead case no. 09-11214 (KG), before the United
States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”),
in which Aventine Renewable Energy Holdings, Inc. (“ARE Holdings” and, in
the case of reorganized ARE Holdings, the “Issuer”) and certain of its affiliates were
debtors and debtors in possession (collectively with ARE Holdings, the “Debtors”).  Reference is further made to: (i) the
Chapter 11 plan of reorganization filed by the Debtors on December 4, 2009
(as modified or amended, the “Plan”), and (ii) the original letter agreement
among Brigade Capital Management, LLC, Nomura Corporate Research &
Asset Management, Inc., Whitebox Advisors LLC, Senator Investment Group LP
and SEACOR Capital Corporation, dated December 3, 2009 (the “First Backstop Commitment Agreement”).
Capitalized terms used in this letter agreement (the “Second Backstop Commitment Agreement”)
and not otherwise defined shall have the meanings provided in the term sheet
relating to the issuance of additional Senior Secured Notes (the “Senior Secured Notes Term Sheet”)
attached hereto as Exhibit A.(1)


 


The Plan proposed that the
Debtors would obtain exit financing required for the emergence of the Debtors
from Chapter 11 of the Bankruptcy Code through the offering and sale (the “First Offering”) of
$105,000,000 in aggregate principal amount (the “First Offering Amount”) of the Issuer’s
13% senior secured notes due 2015 (the “Senior Secured Notes”) on the terms described
in the Plan and the Senior Secured Notes Term Sheet attached as Exhibit A
to the First Backstop Commitment Agreement. 
Pursuant to the Plan, and subject to the terms and conditions of the
First Backstop Commitment Agreement, each holder of a pre-petition claim with
respect to ARE Holdings’ 10% senior notes due 2017 was entitled to purchase its
respective pro rata amount of the First Offering Amount of Senior Secured
Notes.


 






(1) 
The Senior Secured Notes Term Sheet (including all appendices and schedules
attached thereto) is incorporated into and constitutes a part of this Second
Backstop Commitment Agreement as if set forth herein.


 

















 


On
February 24, 2010, the Bankruptcy Court entered an order approving and
confirming the Plan (the “Confirmation
Order”).  Pursuant to the
Plan, the Confirmation Order and the First Backstop Commitment Agreement, on
March 15, 2010, the Issuer issued and sold an aggregate principal amount
of Senior Secured Notes equal to the First Offering Amount.


 


Subject
to the terms and conditions of this Second Backstop Commitment Agreement, the
Issuer may desire to obtain additional financing through the offering and sale
(the “Second Offering”)
of an aggregate principal amount of Senior Secured Notes equal to up to
$50,000,000 (the Second
Offering Amount”). 
Subject to the terms and conditions of this Second Backstop Commitment
Agreement, if the Issuer desires to proceed with the Second Offering, the
Issuer shall use its commercially reasonable efforts to offer and sell the
Senior Secured Notes, in an aggregate principal amount up to the Second
Offering Amount, in a private placement exempt from registration under the
Securities Act of 1933, as amended (the “Securities Act”),
pursuant to Section 4(2) thereunder or other available exemption to (i) qualified
institutional buyers, as that term is defined in Rule 144A under the
Securities Act, (ii) accredited investors, as that term is defined in Rule 501(a) of
Regulation D under the Securities Act, or (iii) a person other than a U.S.
person, as that term is defined in Regulation S under the Securities Act,
located outside the United States (collectively, the “Proposed  Purchasers”).


 


To provide assurance that
the Second Offering will be fully subscribed, subject to the conditions set
forth herein, each of the undersigned (collectively,  the “Backstop
Purchasers”) hereby severally, and not jointly, commits to
purchase its Commitment Percentage, not to exceed its Commitment Amount (as
such terms are defined on Schedule I to the Senior Secured Notes Term
Sheet) of the Senior Secured Notes not purchased by the Proposed Purchasers in
the Second Offering (the “Backstop
Commitment”).


 


In consideration of the
foregoing agreements of the Backstop Purchasers:


 


(a)           in connection with the closing of the Second Offering, each
Backstop Purchaser shall be entitled to purchase Senior Secured Notes issued
to it in the Second Offering at a price per $1,000 aggregate principal
amount of Senior Secured Notes equal to $960,
plus accrued interest from the last interest payment date to the settlement
date; and


 


(b)           subject to satisfying the terms and conditions set forth
herein, the Backstop Purchasers
shall be entitled to a commitment fee (the “Commitment
Fee”) in the amount of $500,000,  payable to the Backstop Purchasers in accordance with their respective
Commitment Percentages, regardless of whether the Second Offering is
consummated; and


 


(c)           each of the Backstop Purchasers
hereby makes the representations, warranties and agreements set forth on Exhibit B
hereto.


 


Notwithstanding
the foregoing, the Commitment Fee shall, subject to satisfying the conditions
set forth herein, be (a) deemed fully earned on the date hereof, and (b) payable
in full in cash upon the consummation of the Second Offering or, if earlier, upon termination of this
Second Backstop Commitment Agreement.


 


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The
Commitment Fee, once paid, shall be nonrefundable, paid in immediately
available funds, without setoff or recoupment and shall not be subject to
defense or offset on account of any claim, defense or counterclaim.


 


In
addition to the satisfaction of each of the conditions set forth in the Senior
Secured Notes Term Sheet, this Second Backstop Commitment is subject to the
negotiation, execution and delivery of definitive documentation satisfactory in
form and substance to the Majority Backstop Purchasers and their counsel in
their sole discretion, to be substantially similar in form and substance to
such documentation customarily provided in an offering of a type similar to the
Second Offering and/or no less favorable to the Backstop Purchasers than such
documentation in the First Offering.  The
agreement of the Backstop Purchasers hereunder is further conditioned upon the
Backstop Purchasers not having become aware of any information or other matter
affecting the Issuer or the transactions contemplated hereby that is
inconsistent in a material and adverse manner with any information or other
matter disclosed to the Backstop Purchasers or otherwise known or made available
to any of the Backstop Purchasers prior to the date hereof, or of any material
omissions from the information which has previously been, or may hereafter be,
furnished by the Issuer, or its representatives or advisors, to the Backstop
Purchasers for their review.


 


More
specifically and for purposes of clarity, the commitment of the Backstop
Purchasers to purchase the Senior Secured Notes set forth in this Second
Backstop Commitment Agreement shall terminate and all of the obligations of the
Issuer (other than the obligations of the Issuer to (i) pay the
reimbursable expenses provided for in this Second Backstop Commitment
Agreement,  (ii) satisfy its
indemnification obligations under this Second Backstop Commitment Agreement and
(iii) pay the Commitment Fee) shall be of no further force or effect, upon
the giving of written notice of termination by the  Majority Backstop Purchasers,  in the event that any Backstop Termination Event occurs (as
set forth in the “Termination of Backstop
Commitments” section of the Senior Secured Notes Term Sheet); provided
that each such Backstop Termination Event may be waived in writing by the
Majority Backstop Purchasers:


 


Whether
or not the transactions contemplated hereby are consummated, the Issuer agrees
to: (i) pay within 10 days of demand the reasonable fees, expenses,
disbursements and charges of the Backstop Purchasers incurred previously or in
the future relating to the exploration and discussion of the Backstop
Commitment or to the preparation and negotiation of this Second Backstop
Commitment Agreement, the Senior Secured Notes Term Sheet and the proposed
documentation and the transactions contemplated hereby and thereby, including,
without limitation, the reasonable fees and expenses of counsel to the Backstop
Purchasers, up to an amount not to exceed $30,000
in the aggregate; and (ii) indemnify and hold harmless the Backstop
Purchasers and their affiliates and each of their respective  directors, officers, partners, members,
representatives, employees, agents, attorneys, financial advisors,
restructuring advisors and other professional advisors, each of the foregoing
solely in their capacities as such with respect to the transactions
contemplated by this Second Backstop Commitment Agreement (each an “Indemnified Person”),
and hold each Indemnified Person harmless from and against any and all losses,
claims, damages, liabilities and expenses, joint or several, to which any such
Indemnified Person may incur, have asserted against it or be involved in as a
result of or arising out of or in any way related to this Second Backstop
Commitment Agreement, the Backstop Commitment the Second Offering, the Senior
Secured Notes Term Sheet, the use of proceeds of 


 


3

















 


the
Senior Secured Notes with respect to the Second Offering or any related
transaction or any claim, litigation, investigation or proceeding relating to
any of the foregoing, regardless of whether any of such Indemnified Persons is
a party thereto, and to reimburse each of such Indemnified Persons within 10
days after demand for any reasonable legal or other expenses incurred in
connection with any of the foregoing; provided, however, that the
foregoing indemnity shall not, as to any Indemnified Person, apply to losses,
claims, damages, liabilities or related expenses to the extent they have
resulted from the bad faith, willful misconduct or gross negligence of such
Indemnified Person.


 


Notwithstanding
any other provision to the contrary, no Indemnified Person shall be liable to the Issuer or
its subsidiaries for any special, indirect, consequential or punitive damages
in connection with its activities related to this Second Backstop Commitment
Agreement, the Backstop Commitment, the Second Offering, the Senior Secured Notes
Term Sheet or the use of proceeds of the Senior Secured Notes with respect to
the Second Offering.  The terms set forth
in this indemnification section shall survive termination of this Second
Backstop Commitment Agreement and shall remain in full force and effect
regardless of whether the Second Offering is consummated.


 


This
Second Backstop Commitment Agreement and the rights and obligations hereunder
may not be assigned by the Issuer or its subsidiaries without the prior written
consent of the Majority Backstop Purchasers (and any purported assignment
without such consent shall be null and void). 
This Second Backstop Commitment Agreement is intended to be solely for
the benefit of the parties hereto and is not intended to confer any benefits
upon, or create any rights in favor of, any person other than the parties
hereto and the Indemnified Persons. 
Notwithstanding the foregoing, the Backstop Purchasers may assign all or
any portion of their obligations hereunder to one or more financial institutions
reasonably acceptable to the Issuer; provided, that the Issuer’s consent
shall not be required for such an assignment to a fund affiliated with any
Backstop Purchaser;  provided
further, in the event that a Backstop Purchaser wishes to assign all or
any portion of its obligations hereunder in accordance with the foregoing
provisions (other than to an affiliated fund), the other Backstop Purchaser
shall have a right of first refusal to purchase such obligations in such manner
as they may agree.  Upon any such
assignment (other than an assignment to a fund affiliated with any Backstop
Purchaser without the Issuer’s consent), the obligations of the Backstop
Purchasers in respect of the portion of their obligations so assigned shall
terminate.  In the event that any
Backstop Purchaser fails to meet its obligations under this Second Backstop
Commitment Agreement, the non-breaching Backstop Purchaser shall have the
right, but not the obligation, to assume such obligations.


 


This
Second Backstop Commitment Agreement sets forth the agreement of the Backstop
Purchasers to fund the Backstop Commitment on the terms and subject to the
conditions described herein and in the Senior Secured Notes Term Sheet, and
shall be considered withdrawn if the Backstop Purchasers have not received from
the Issuer and its subsidiaries a fully executed counterpart to this Second
Backstop Commitment Agreement on or before 4:00 p.m. New York City time on
August 2, 2010.


 


This
Second Backstop Commitment Agreement will be governed by, and construed and
interpreted in accordance with, the laws of the State of New York.


 


4

















 


By
accepting delivery of this Backstop Commitment Agreement, the Issuer and its
subsidiaries agree that this Second Backstop Commitment Agreement is
confidential and that neither its existence nor the terms hereof will be
disclosed by such entity to any person other than such entity officers,
directors, employees, accountants, attorneys and other advisors, and then only
on a “need to know” basis in connection with
the transactions contemplated hereby and on a confidential basis.
Notwithstanding the foregoing, following the Issuer’s and its subsidiaries’
acceptance of the provisions hereof and delivery of an executed counterpart of
this Second Backstop Commitment Agreement to the Backstop Purchasers as
provided below, the Issuer may (i) make such public disclosures of the
terms and conditions hereof as required by law, in the opinion of counsel to
the Issuer, to be made and (ii) file a copy of this Second Backstop
Commitment Agreement with the Securities and Exchange Commission or in any
public record in which it is required by law to be filed.


 


This
Second Backstop Commitment Agreement may not be amended or waived except in
writing signed by the Issuer and the Majority Backstop Purchasers.  This Second Backstop Commitment Agreement may
be executed in any number of counterparts, each of which will be an original,
and all of which, when taken together, will constitute one agreement.  Delivery of an executed counterpart of this
Second Backstop Commitment Agreement by email in portable document format (.pdf
format) will be effective as delivery of a manually executed counterpart of
this Second Backstop Commitment Agreement.


 


This
Second Backstop Commitment Agreement shall become effective and binding upon
the mutual exchange of fully executed counterparts.


 


If
the foregoing is in accordance with your understanding of our agreement, please
sign this Backstop Commitment Agreement in the space indicated below and return
it to us.


 


	
   

  	
  Very
  truly yours,

  



 


5

















 


	
   

  	
  BRIGADE
  CAPITAL MANAGEMENT, LLC, as investment manager for and on behalf of certain
  funds

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Carney Hawks

  
	
   

  	
   

  	
  Name:
  Carney Hawks

  
	
   

  	
   

  	
  Title:
  Partner

  
	
   

  	
   

  
	
   

  	
  Dated:
  August 2, 2010

  



 


Signatures continue on following pages


 

















 


	
   

  	
  SENATOR
  INVESTMENT GROUP LP, as investment manager for and on behalf of certain funds

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Edward Larmann

  
	
   

  	
   

  	
  Name:
  Edward Larmann

  
	
   

  	
   

  	
  Title:
  CFO

  
	
   

  	
   

  
	
   

  	
  Dated:
  August 2, 2010

  



 


Signatures continue on following pages


 

















 


	
  The
  foregoing is hereby agreed to and accepted:

  	
   

  
	
   

  	
   

  
	
  AVENTINE
  RENEWABLE ENERGY HOLDINGS, INC.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/
  John W. Castle

  	
   

  
	
   

  	
  Name:
  John W. Castle

  	
   

  
	
   

  	
  Title:
  CFO

  	
   

  
	
   

  	
   

  
	
  Dated:
  August 2, 2010

  	
   

  



 


 


	
  AVENTINE
  RENEWABLE ENERGY, INC.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/
  John W. Castle

  	
   

  
	
   

  	
  Name:
  John W. Castle

  	
   

  
	
   

  	
  Title:
  CFO

  	
   

  
	
   

  	
   

  
	
  Dated:
  August 2, 2010

  	
   

  



 


 


	
  AVENTINE
  RENEWABLE ENERGY – MT VERNON, LLC

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/
  John W. Castle

  	
   

  
	
   

  	
  Name:
  John W. Castle

  	
   

  
	
   

  	
  Title:
  CFO

  	
   

  
	
   

  	
   

  
	
  Dated:
  August 2, 2010

  	
   

  



 

















 


	
  AVENTINE
  RENEWABLE ENERGY – AURORA WEST LLC

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/
  John W. Castle

  	
   

  
	
   

  	
  Name:
  John W. Castle

  	
   

  
	
   

  	
  Title:
  CFO

  	
   

  
	
   

  	
   

  
	
  Dated:
  August 2, 2010

  	
   

  



 


 


	
  AVENTINE
  POWER, LLC

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/
  John W. Castle

  	
   

  
	
   

  	
  Name:
  John W. Castle

  	
   

  
	
   

  	
  Title:
  CFO

  	
   

  
	
   

  	
   

  
	
  Dated:
  August 2, 2010

  	
   

  



 


 


	
  NEBRASKA
  ENERGY, LLC

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/
  John W. Castle

  	
   

  
	
   

  	
  Name:
  John W. Castle

  	
   

  
	
   

  	
  Title:
  CFO

  	
   

  
	
   

  	
   

  
	
  Dated:
  August 2, 2010

  	
   

  



 






 










 


EXHIBIT A


 


Senior Secured Notes Term Sheet


 


AVENTINE RENEWABLE ENERGY HOLDINGS, INC.


 


$50,000,000 13% Senior Secured Notes due 2015


 


Summary of Principal Terms


 


The
following Summary of Principal Terms (this “Senior
Secured Notes Term Sheet”) provides an outline of a proposed notes
offering by the issuer identified below. 
This Senior Secured Notes Term Sheet is an expression of interest only
and is not meant to be binding on the parties and is meant only as a negotiation
aid to be used by the issuer, any Backstop
Purchaser (defined below) or other person or entity to provide any financing or
to enter into any agreement or contract or any other financing
arrangement.  Accordingly, the parties do
not intend to be bound unless and until they enter into definitive
documentation regarding the subject matter of this Senior Secured Notes Term
Sheet.  The actual terms and conditions
upon which any purchaser might purchase the notes are subject to internal
approvals, execution and delivery of definitive legal documentation by all
required parties and such other terms and conditions as are determined by the
parties; provided that such other terms and conditions are consistent
with the terms of this Senior Secured Notes Term Sheet.  Until disclosed by the issuer, with the prior
written consent of the Majority
Backstop Purchasers  or as permitted by the Backstop Commitment
Agreement (defined below), this Senior Secured Notes Term Sheet and the
information contained herein is strictly confidential and may not be shared with
any person or entity.  Unless otherwise
defined herein, each capitalized term used in this Senior Secured Notes Term
Sheet shall have the same meaning ascribed to such term in the Backstop
Commitment Agreement to which this Senior Secured Notes Term Sheet is attached.


 


	
  Issuer:

  	
   

  	
  Aventine
  Renewable Energy Holdings, Inc. (the “Issuer”).

  
	
   

  	
   

  	
   

  
	
  Securities
  Offered:

  	
   

  	
  Up
  to $50,000,000 in aggregate principal amount (the “Offering
  Amount”) of 13% senior secured notes due 2015 (the “Notes”) issued pursuant to the Indenture,
  dated as of March 15, 2010, among the Issuer, the guarantors named
  therein, as guarantors, and Wilmington Trust, FSB, as trustee and collateral
  agent (the “Indenture”).  Each $1,000 in principal amount of Notes
  will be issued and sold (other than as set forth under “Backstop Purchaser
  Discount”) at an offering price equal to 100%, plus accrued interest from the last interest payment date
  to the settlement date.  

  
	
   

  	
   

  	
   

  
	
  Offering:

  	
   

  	
  The
  Issuer will use its  commercially
  reasonably  efforts to offer and
  sell the Notes, in an aggregate principal amount up to the Offering Amount
  (the “Offering”), in a private
  placement exempt from registration under the Securities Act of 1933, as
  amended (the “Securities Act”), pursuant
  to Section 4(2) thereunder or other available exemption to (i) qualified
  institutional buyers, as that term is defined in Rule 144A under the
  Securities Act, (ii) accredited investors, as that term is defined in
  Rule 501(a) of Regulation D under the Securities Act, or (iii) a
  person other than a U.S. person, as that term is defined in Regulation S
  under the Securities Act, located outside the United States (collectively,
  the “Purchasers”).  To the extent less than all of the Notes
  are issued to the Purchasers, the
  entities which agree to backstop the Offering pursuant to the Backstop
  Commitment Agreement (defined below), the initial list of which is set forth
  on Schedule I hereto (the parties listed on Schedule I, the “Backstop Purchasers” and
  each a “Backstop Purchaser”).
  For the avoidance of doubt, the Backstop Purchasers shall be entitled to 

  



 

















 


	
   

  	
   

  	
  participate
  in the Offering in their capacity as
  Purchasers.

   

  On
  the terms and subject to the conditions set forth in that certain commitment
  letter agreement, dated as of August 2, 2010 (the “Backstop
  Commitment Agreement”), each Backstop Purchaser will severally commit to purchase its respective
  Commitment Percentage (defined below) of Notes up to an aggregate
  principal amount equal to the Offering Amount on or after August 15,
  2010.  For purposes hereof, (i) a Backstop Purchaser’s “Commitment Percentage” is the percentage for such purchaser set
  forth on Schedule I hereto and (ii) “Majority
  Backstop Purchasers”
  shall mean the Backstop Purchasers having at least a majority of the
  aggregate Commitment Percentages.

  
	
   

  	
   

  	
   

  
	
  Registered Exchange
  Offer; Registration Rights:

   

  	
   

  	
  In
  connection with the closing of the Offering, the Issuer and the guarantors of
  the Notes shall enter into a registration rights agreement (the “Registration Rights Agreement”) in
  form and substance acceptable to the Majority
  Backstop Purchasers in their sole discretion.  The Registration Rights Agreement shall
  provide, among other things, for the registered exchange of the Notes for a
  new issue of substantially identical debt securities (the “Exchange Registration”).

   

  With
  respect to the Exchange Registration, the Registration Rights Agreement will
  obligate the Issuer and guarantors of the Notes to:

   

  ·      file a
  registration statement with the Securities and Exchange Commission enabling
  the holders of the Notes to exchange the privately issued Notes for publicly
  registered notes with substantially identical terms within 180 days after the
  closing of the Offering;

   

  ·      cause
  such registration statement to become effective within 365 days after the
  closing of the Offering and to complete the exchange offer within 50 days
  after the effective date of such registration statement; and

   

  ·      file a
  shelf registration statement for the resale of the Notes if the Issuer and
  the guarantors of the Notes cannot effect an exchange offer within the time
  periods listed above and in certain other circumstances.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  The
  failure of the Issuer and the guarantors of the Notes to meet any of the
  obligations describe above with respect to the Exchange Registration shall
  result in additional interest becoming payable with respect to the Notes
  (including the notes issued in the Exchange Registration) in the amount of
  2.0%.

  
	
   

  	
   

  	
   

  
	
  Use of
  Proceeds:

  	
   

  	
  The
  gross proceeds of the Offering will be used for transaction expenses and
  either applied to replenish funds previously used to construct or acquire
  equipment and real estate pledged to secure the Notes (which replenished
  funds may be used to acquire additional equipment and real estate or for
  other general corporate purposes) or deposited at closing with the collateral
  agent pending use to construct or acquire equipment and real estate pledged
  to secure the Notes. 

  



 


2

















 


	
  Backstop Purchaser Discount:

  	
   

  	
  In
  consideration of the agreements of the Backstop Purchasers set forth in the
  Backstop Commitment Agreement, each Backstop Purchaser shall be entitled to
  purchase Notes issued to it in the Offering at a price per $1,000
  aggregate principal amount of Notes equal to $960, plus accrued interest from
  the last interest payment date to the settlement date.  

  
	
   

  	
   

  	
   

  
	
  Commitment Fee:

  	
   

  	
  Subject to satisfying the
  terms and conditions of the Backstop Commitment Agreement, the Backstop Purchasers shall be entitled to a
  commitment fee (the “Commitment Fee”)
  in the amount of $500,000, payable to the Backstop Purchasers in
  accordance with their respective Commitment Percentages, regardless of
  whether the Offering is consummated. 
  The Commitment Fee will be paid at the consummation of the Offering or, if earlier, upon termination of the
  Backstop Commitment Agreement.

  
	
   

  	
   

  	
   

  
	
  Ratings:

  	
   

  	
  If
  not obtained prior to the issue date, the Issuer will use its commercially
  reasonable efforts to obtain ratings for the Notes by either Standard &
  Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc.,
  or Moody’s Investors Service, Inc. 
  

  
	
   

  	
   

  	
   

  
	
  Conditions
  Precedent To the Closing:

  	
   

  	
  The
  obligation of the Backstop Purchasers
  to purchase the Notes as set forth in the Backstop Commitment Agreement will
  be conditioned upon satisfaction of each of the following conditions; provided,
  that each of the following conditions may be waived by the Majority Backstop Purchasers in their sole
  discretion:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·      The
  Notes and all documents, instruments and other agreements executed and
  delivered in connection with any of the foregoing (collectively, the “Notes Documents”) shall be in form
  and substance satisfactory to the Majority
  Backstop Purchasers in their
  sole discretion;

   

  ·      All
  reasonable out-of-pocket fees and expenses (including reasonable fees and
  expenses of counsel) required to be paid to each of the Backstop Purchasers
  (in an amount not to exceed $30,000), the trustee and the collateral agent
  for the Notes on or before the closing of the Offering have been paid in full
  in cash;

   

  ·      There
  shall have occurred no material adverse effect on any of (i) the
  operations, performance, prospects, business, assets, properties, or
  condition (financial or otherwise) of the Issuer and its subsidiaries, taken
  as a whole, based on publicly available information and other information
  provided by the Issuer to the Backstop Purchasers since August 2, 2010, (ii) the ability of
  the Issuer and its subsidiaries to perform their respective obligations under
  the Notes Documents and the Indenture or (iii) the ability of the
  noteholders to enforce their rights under the Notes Documents and the
  Indenture (each of the foregoing, a “Material Adverse Change”);
  and

   

  ·      Any and
  all governmental and third party consents and approvals necessary in
  connection with the offer and sale of the Notes, the 

  



 


3

















 


	
   

  	
   

  	
  execution
  of the Notes Documents and the transactions contemplated hereby and thereby
  shall have been obtained and shall remain in effect.

  
	
   

  	
   

  	
   

  
	
  Termination of Backstop Commitments:

  	
   

  	
  The
  commitment of the Backstop Purchasers
  to purchase the Notes set forth in the Backstop Commitment Agreement (the “Backstop Commitment”) shall
  terminate and all of the obligations of the Issuer and its subsidiaries
  (other than the obligations of the Issuer and its subsidiaries to (i) pay
  the reimbursable expenses under the Backstop Commitment Agreement, (ii) satisfy
  their indemnification obligations under the Backstop Commitment Agreement and
  (iii) pay the Commitment Fee) shall be of no further force or effect,
  upon the giving of written notice of termination by the Majority Backstop
  Purchasers, in the event that any of the following occurs (each, a “Backstop Termination Event”), each
  of which may be waived in writing by the Majority Backstop Purchasers.

   

  ·     the closing of the Offering does not
  occur on or before September 15, 2010; provided, that that the Majority Backstop Purchasers have not
  acted (or failed to act) in a manner materially inconsistent with this Senior
  Secured Notes Term Sheet;

   

  ·     an action (or failure to act) by the
  Issuer or any of its subsidiaries that is materially inconsistent with this
  Senior Secured Notes Term Sheet, unless such action (or inaction) is cured
  within five business days of receiving written notice thereof from the Majority Backstop Purchasers;

   

  ·     any court of competent jurisdiction or
  other competent governmental or regulatory authority issues an order making
  illegal or otherwise restricting, preventing, or prohibiting the Offering as
  set forth in this Senior Secured Notes Term Sheet in a manner that cannot be
  reasonably and promptly remedied by the Issuer or the Backstop Purchasers;

   

  ·     one or more of the conditions precedent
  to the consummation of the transactions set forth in this Senior Secured
  Notes Term Sheet or to the obligations of the Backstop Purchasers set forth in the  Backstop Commitment Agreement is not
  satisfied or, in the judgment of the Majority Backstop Purchasers,
  becomes impossible to satisfy on or before the closing of the Offering; or

   

  ·     at any time from and after the occurrence
  of a Material Adverse Change.

  
	
   

  	
   

  	
   

  
	
  Closing
  Date:

  	
   

  	
  On
  or after August 15, 2010, but no later than September 15, 2010, as
  specified at least five business days in advance of the closing in a written
  notice delivered by the Issuer to the Backstop Purchasers.

  
	
   

  	
   

  	
   

  
	
  Expenses:

  	
   

  	
  The
  Issuer shall pay all out of pocket costs and expenses of each of the Backstop Purchasers (to the extent required
  hereunder) and the trustee and collateral agent for the Notes (including all
  reasonable fees and expenses of counsel and consultants) in connection with
  the negotiation, preparation, execution and delivery of the Notes Documents,
  any 

  



 


4

















 


	
   

  	
   

  	
  amendment or waiver of any provision of the Notes
  Documents and in connection with the enforcement or protection of any of
  their rights and remedies under the Notes Documents, and the issuance of the
  Notes issued to the Backstop Purchasers  and the
  Purchasers.

  



 


5

















 


Schedule I


 


Backstop Purchasers


 


	
  Backstop
  Purchasers

  	
   

  	
  Commitment 

  Percentage

  	
   

  	
  Commitment 

  Amount

  	
   

  
	
  Brigade Capital Management, LLC, as investment manager, for and on
  behalf of certain funds  

  	
   

  	
  66.67

  	
  %

  	
  $

  	
  33,335,000

  	
  *

  
	
  Senator Investment Group LP, as investment manager, for and on behalf of
  certain funds  

  	
   

  	
  33.33

  	
  %

  	
  $

  	
  16,665,000

  	
  *

  
	
  TOTAL  

  	
   

  	
  100

  	
  %

  	
  $

  	
  50,000,000

  	
  *

  



 






*  Excluding accrued interest from the last
interest payment date to the settlement date.


 

















 


EXHIBIT B


 


Agreement, Representations and Warranties


 


(1)           such Backstop Purchaser acknowledges
that the new Senior Secured Notes subscribed for will not be offered pursuant
to an effective registration statement and will be subject to restrictions on
resale and transfer and may not be sold except as permitted below;


 


(2)           such Backstop Purchaser (or such
account for which such Backstop Purchaser is purchasing Senior Secured Notes)
is acquiring the new Senior Secured Notes for its own account and not with a
view to any distribution of the new Senior Secured Notes in violation of the
Securities Act subject, nevertheless, to the understanding that the disposition
of its property will at all times remain within its control;


 


(3)           such Backstop Purchaser acknowledges
that it is purchasing the new Senior Secured Notes for its own account or for
an account with respect to which it exercises sole investment discretion and
has full power to make these acknowledgments, representations, warranties and
agreements and that it and any such account is either (A) an “Accredited
Investor” (as defined in Rule 501(a) of Regulation D under the
Securities Act) or a “Qualified Institutional Buyer” (as defined in Rule 144A
under the Securities Act) and is aware, and each beneficial owner of such new
Senior Secured Notes has been advised, that the sale of such new Senior Secured
Notes to it is being made in a transaction exempt from registration under the
Securities Act or (B) not a “U.S. person” acquiring any new Senior Secured
Notes in an offshore transaction within the meaning of Regulation S;


 


(4)           such Backstop Purchaser understands
and agrees on its own behalf and on behalf of any accounts for which it is
acting as hereinafter stated that (1) such new Senior Secured Notes are
being offered only in a transaction not involving any public offering within
the meaning of the Securities Act, and (2) that if within at least one
year after the later of (A) the date of original issuance of the new
Senior Secured Notes and (B) the last date in which the Company or any of
its affiliates, within the meaning of Rule 144 under the Securities Act,
was the owner of the new Senior Secured Notes, it decides to resell, pledge or
otherwise transfer such new Senior Secured Notes on which the legend set forth
below appears, such new Senior Secured Notes may be resold, pledged or
transferred only (I) to the Issuer, (II) pursuant to an effective
registration statement under the Securities Act, (III) for so long as the
Senior Secured Notes are eligible for resale pursuant to Rule 144A, to a
person it reasonably believes is a Qualified Institutional Buyer that purchases
for its own account or for the account of a Qualified Institutional Buyer to
whom notice is given that the transfer is being made in reliance on Rule 144A,
(IV) pursuant to offers and sales to non-U.S. persons that occur outside the
United States within the meaning of Regulation S under the Securities Act, (V) to
an Accredited Investor that is acquiring the security for its own account, or
for the account of such an Accredited Investor, for investment purposes and not
with a view to, or for offer or sale in connection with, any distribution in
violation of the Securities Act, or (VI) pursuant to another available
exemption from the registration requirements of the Securities Act, and (3) the
purchaser will, and each subsequent holder is required to, notify any purchaser
of new Senior Secured Notes from it of the resale restrictions referred to in
clause (2) of this paragraph, if then applicable;


 

















 


(5)           such Backstop Purchaser understands
that each new Senior Secured Note will contain the following legend, unless
otherwise agreed by the Issuer:


 


THIS
NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
REGISTRATION. THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF (1) REPRESENTS
THAT (A) IT IS A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT), (B) IT IS A NON-U.S. PURCHASER AND IS ACQUIRING
THIS NOTE IN AN OFFSHORE TRANSACTION WITHIN THE MEANING OF REGULATION S
UNDER THE SECURITIES ACT OR (C) IT IS AN “ACCREDITED INVESTOR” WITHIN THE
MEANING OF SUBPARAGRAPH (a) OF RULE 501 UNDER THE SECURITIES ACT AND (2) AGREES
TO OFFER, SELL OR OTHERWISE TRANSFER THIS NOTE, PRIOR TO THE DATE WHICH IS ONE
YEAR (OR SUCH OTHER PERIOD THAT MAY BE HEREAFTER PROVIDED UNDER RULE 144
UNDER THE SECURITIES ACT PERMITTING RESALES OF RESTRICTED SECURITIES BY
NON-AFFILIATES WITHOUT RESTRICTION) AFTER THE LATER OF THE ORIGINAL ISSUE DATE
HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS
THE OWNER OF THIS NOTE (OR ANY PREDECESSOR OF SUCH NOTE), ONLY (A) TO THE
COMPANY OR ANY OF ITS SUBSIDIARIES, (B) PURSUANT TO A REGISTRATION
STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR
SO LONG AS THE NOTES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON
IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS
AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE
MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN “ACCREDITED
INVESTOR” WITHIN THE MEANING OF SUBPARAGRAPH (a) OF RULE 501 UNDER THE
SECURITIES ACT THAT IS ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT, OR FOR THE
ACCOUNT OF SUCH AN ACCREDITED INVESTOR, FOR INVESTMENT PURPOSES AND NOT WITH A
VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION
OF THE SECURITIES ACT OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY’S
AND THE TRUSTEE’S, OR TRANSFER AGENT’S, AS APPLICABLE, RIGHT PRIOR TO ANY SUCH
OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (D), (E) OR (F) TO
REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER
INFORMATION SATISFACTORY TO EACH OF THEM, AND IN EACH OF THE FOREGOING CASES, A
CERTIFICATE OF 


 

















 


TRANSFER
IN THE FORM APPEARING ON THE OTHER SIDE OF THIS SECURITY IS COMPLETED AND
DELIVERED BY THE TRANSFEROR TO THE TRUSTEE OR TRANSFER AGENT;


 


(6)           such Backstop Purchaser (1) is
able to act on its own behalf for itself (or any such account for which it is purchasing
Senior Secured Notes) in the transactions contemplated by the Second Backstop
Commitment Agreement, (2) has such knowledge and experience in financial
and business matters as to be capable of evaluating the merits and risks of its
prospective investment in the new Senior Secured Notes, and (3) (or the
account for which it is acting) has the ability to bear the economic risks of
its prospective investment in the new Senior Secured Notes and can afford the
complete loss of such investment;


 


(7)           such Backstop Purchaser understands
that the Issuer and the guarantors and others will rely upon the truth and
accuracy of the foregoing acknowledgements, representations, warranties and
agreements and agrees that if any of the acknowledgements, representations,
warranties and agreements made by it by its submission of this Second Backstop
Commitment Agreement are, at any time prior to the consummation of the Second
Offering, no longer accurate, it shall promptly notify the Issuer.  If it is acquiring the new Senior Secured
Notes as a fiduciary or agent for one or more investor accounts, it represents
that it has sole investment discretion with respect to each such account and it
has full power to make the foregoing acknowledgements, representations, warranties
and agreements on behalf of such account;


 


(8)           other than with respect to the
transactions contemplated herein, since the time that such Backstop Purchaser
was first contacted by the Issuer or any other person regarding the
transactions contemplated hereby, neither such Backstop Purchaser nor any
affiliate of such Backstop Purchaser which (1) had knowledge of the
transactions contemplated hereby and (2)(x) has or shares discretion
relating to such Backstop Purchaser’s investments or trading or information
concerning such Backstop Purchaser’s investments, including in respect of the
Senior Secured Notes, or (y) is subject to such Backstop Purchaser’s
review or input concerning such affiliate’s investments or trading
(collectively, “Trading
Affiliates”) has directly or indirectly, nor has any person
acting on behalf of or pursuant to any understanding with such Backstop
Purchaser or Trading Affiliate, effected or agreed to effect any transactions
in the securities of the Issuer (notwithstanding the foregoing, in the case of
a Backstop Purchaser and/or Trading Affiliate that is, individually or
collectively, a multi-managed investment vehicle whereby separate portfolio
managers manage separate portions of such Backstop Purchaser’s or Trading
Affiliate’s assets and the portfolio managers have no direct knowledge of the
investment decisions made by the portfolio managers managing other portions of
such Backstop Purchaser’s or Trading Affiliate’s assets, the representation set
forth above shall apply only with respect to the portion of assets managed by
the portfolio managers that have knowledge about the financing transaction
contemplated by this Second Backstop Commitment Agreement);


 


(9)           other than to other persons party to
this Second Backstop Commitment Agreement and to advisors, such Backstop
Purchaser has maintained the confidentiality of all disclosures made to it in
connection with this transaction (including the existence and terms of this
transaction); and


 

















 


(10)         such Backstop Purchaser is aware that the
anti-manipulation rules of Regulation M under the Securities Exchange Act
of 1934, as amended, may apply to sales of the Issuer’s securities and other
activities with respect to the Issuer’s securities by the Backstop Purchasers.