ex4_3.htm


    
      

    

    Exhibit
      4.3

    


    INTERCREDITOR
      AGREEMENT

    


    dated
      as
      of

    


    November
      29, 2007

    


    among

    


    GASTAR
      EXPLORATION USA, INC.,

    as
      the
      Company

    


    GASTAR
      EXPLORATION LTD.,

    as
      the
      Parent

    


    certain
      Subsidiaries of the Parent party hereto

    


    AMEGY
      BANK NATIONAL ASSOCIATION,

    as
      First
      Priority Agent

    


    and

    


    WELLS
      FARGO BANK, NATIONAL ASSOCIATION,

    as
      Second
      Priority Agent

     

     

    
      
        

      

    

     

    THIS
      IS THE INTERCREDITOR AGREEMENT REFERRED TO IN (A) THE INDENTURE DATED AS OF
      NOVEMBER 29, 2007, AMONG GASTAR EXPLORATION USA, INC., CERTAIN OF ITS
      SUBSIDIARIES FROM TIME TO TIME PARTY THERETO, GASTAR EXPLORATION LTD. AND WELLS
      FARGO BANK, NATIONAL ASSOCIATION, AS TRUSTEE AND COLLATERAL AGENT, (B) THE
      CREDIT AGREEMENT DATED AS OF NOVEMBER 29, 2007, AS AMENDED, SUPPLEMENTED,
      RESTATED OR OTHERWISE MODIFIED FROM TIME TO TIME, AMONG GASTAR EXPLORATION
      USA,
      INC., CERTAIN OF ITS SUBSIDIARIES FROM TIME TO TIME PARTY THERETO, GASTAR
      EXPLORATION LTD., THE LENDERS FROM TIME TO TIME PARTY THERETO AND AMEGY BANK
      NATIONAL ASSOCIATION, AS AGENT, (C) THE OTHER LOAN DOCUMENTS REFERRED TO IN
      SUCH
      CREDIT AGREEMENT AND (D) THE OTHER COLLATERAL AGREEMENTS REFERRED TO IN SUCH
      INDENTURE.

     

    
      
        

      

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    TABLE
      OF CONTENTS

     

    Page

     

    ARTICLE
      I

    


    DEFINITIONS

    


    
      	
              SECTION
                1.01.

            	
              Certain
                Defined Terms

            	
              2

            
	
              SECTION
                1.02.

            	
              Other
                Defined Terms

            	
              2

            
	
              SECTION
                1.03.

            	
              Terms
                Generally

            	
              7

            


    

    


    ARTICLE
      II

    


    LIEN
      PRIORITIES

    


    
      	
              SECTION
                2.01.

            	
              Relative
                Priorities

            	
              8

            
	
              SECTION
                2.02.

            	
              Prohibition
                on Contesting Liens

            	
              8

            
	
              SECTION
                2.03.

            	
              No
                New Liens

            	
              8

            
	
              SECTION
                2.04.

            	
              Similar
                Collateral

            	
              9

            


    

    


    ARTICLE
      III

    


    ENFORCEMENT
      OF RIGHTS; MATTERS RELATING TO COLLATERAL

    


    
      	
              SECTION
                3.01.

            	
              Exercise
                of Rights and Remedies; Option to Purchase

            	
              9

            
	
              SECTION
                3.02.

            	
              No
                Interference

            	
              11

            
	
              SECTION
                3.03.

            	
              Rights
                as Unsecured Creditors

            	
              13

            
	
              SECTION
                3.04.

            	
              Automatic
                Release of Second Priority Liens.

            	
              13

            
	
              SECTION
                3.05.

            	
              Automatic
                Release of First Priority Liens

            	
              14

            
	
              SECTION
                3.06.

            	
              Insurance
                and Condemnation Awards

            	
              14

            
	
              SECTION
                3.07.

            	
              Notification
                of Release of Collateral

            	
              15

            


    

    


    ARTICLE
      IV

    


    PAYMENTS

    


    
      	
              SECTION
                4.01.

            	Application
              of Proceeds	 
	
              SECTION
                4.02.

            	
              Payment
                Over

            	
              15

            
	
              SECTION
                4.03.

            	
              Certain
                Agreements with Respect to Unenforceable Liens

            	
              16

            


    

     

    
      
        
        

      

      
        -i-

        
          

        

      

      
        
        

      

    

    


    ARTICLE
      V

    


    BAILMENT
      FOR PERFECTION OF CERTAIN SECURITY INTERESTS

    


    ARTICLE
      VI

    


    INSOLVENCY
      OR LIQUIDATION PROCEEDINGS

    


    
      	
              SECTION
                6.01.

            	
              Finance
                and Sale Matters

            	
              17

            
	
              SECTION
                6.02.

            	
              Relief
                from the Automatic Stay

            	
              19

            
	
              SECTION
                6.03.

            	
              Reorganization
                Securities

            	
              19

            
	
              SECTION
                6.04.

            	
              Post-Petition
                Interest

            	
              19

            
	
              SECTION
                6.05.

            	
              Certain
                Waivers by the Second Priority Secured Parties

            	
              20

            
	
              SECTION
                6.06.

            	
              Certain
                Voting Matters

            	
              20

            


    

    


    ARTICLE
      VII

    


    OTHER
      AGREEMENTS

    


    
      	
              SECTION
                7.01.

            	
              Matters
                Relating to Debt Documents

            	
              20

            
	
              SECTION
                7.02.

            	
              Effect
                of Refinancing of Indebtedness under First Priority Debt
                Documents

            	
              20

            
	
              SECTION
                7.03.

            	
              No
                Waiver by First Priority Secured Parties

            	
              21

            
	
              SECTION
                7.04.

            	
              Reinstatement

            	
              21

            
	
              SECTION
                7.05.

            	
              Authorization
                of Collateral Agents

            	
              21

            
	
              SECTION
                7.06.

            	
              Further
                Assurances

            	
              22

            


    

    


    ARTICLE
      VIII

    


    REPRESENTATIONS
      AND WARRANTIES

    


    
      	
              SECTION
                8.01.

            	
              Representations
                and Warranties of Each Party

            	
              22

            
	
              SECTION
                8.02.

            	
              Representations
                and Warranties of Each Collateral Agent

            	
              22

            


    

    


    ARTICLE
      IX

    


    NO
      RELIANCE; NO LIABILITY; OBLIGATIONS ABSOLUTE

    


    
      	
              SECTION
                9.01.

            	
              No
                Reliance; Information

            	
              22

            
	
              SECTION
                9.02.

            	
              No
                Warranties or Liability

            	
              23

            
	
              SECTION
                9.03.

            	
              Obligations
                Absolute

            	
              23

            


    

     

    
      
        
        

      

      
        -ii-

        
          

        

      

      
        
        

      

    


    ARTICLE
      X

    


    MISCELLANEOUS

    


    
      	
              SECTION
                10.01.

            	
              Notices

            	
              24

            
	
              SECTION
                10.02.

            	
              Conflicts

            	
              25

            
	
              SECTION
                10.03.

            	
              Effectiveness;
                Survival; Termination

            	
              25

            
	
              SECTION
                10.04.

            	
              Severability

            	
              25

            
	
              SECTION
                10.05.

            	
              Amendments;
                Waivers

            	
              26

            
	
              SECTION
                10.06.

            	
              Postponement
                of Subrogation

            	
              26

            
	
              SECTION
                10.07.

            	
              Applicable
                Law; Jurisdiction; Consent to Service of Process

            	
              26

            
	
              SECTION
                10.08.

            	
              Waiver
                of Jury Trial

            	
              27

            
	
              SECTION
                10.09.

            	
              Parties
                in Interest

            	
              27

            
	
              SECTION
                10.10.

            	
              Specific
                Performance

            	
              27

            
	
              SECTION
                10.11.

            	
              Headings

            	
              27

            
	
              SECTION
                10.12.

            	
              Counterparts

            	
              27

            
	
              SECTION
                10.13.

            	
              Provisions
                Solely to Define Relative Rights

            	
              28

            


    


    
      
        
        

      

      
        -iii-

        
          

        

      

      
        
        

      

    


    INTERCREDITOR
      AGREEMENT dated as of November 29, 2007 (this
“Agreement”) among GASTAR EXPLORATION USA, INC., a
      Michigan corporation (the “Company”), GASTAR
      EXPLORATION LTD., an Alberta, Canada corporation (the
“Parent”), the Subsidiaries of the Parent party
      hereto, AMEGY BANK NATIONAL ASSOCIATION, as agent for the First Priority Secured
      Parties (as defined below) (in such capacity, the “First Priority
      Agent”), and WELLS FARGO BANK, NATIONAL ASSOCIATION, as collateral
      agent for the Second Priority Secured Parties (as defined below) (in such
      capacity, the “Second Priority Agent”).

     

    PRELIMINARY
      STATEMENT

     

    Reference
      is made to (a) the Credit Agreement dated as of November 29, 2007 (as amended,
      supplemented, restated or otherwise modified from time to time in accordance
      with the terms hereof, the “First Priority Debt
      Agreement”) among the Company, the Parent, certain of the
      Company’s subsidiaries, the lenders from time to time party thereto (the
“First Priority Creditors”) and the First Priority
      Agent, (b) the Indenture dated as of November 29, 2007 (as amended,
      supplemented, restated or otherwise modified from time to time in accordance
      with the terms hereof, the “Second Priority Debt
      Agreement” and, together with the First Priority Debt Agreement,
      the “Debt Agreements”) among the Company, the Parent,
      certain of the Company’s subsidiaries, Wells Fargo Bank, National Association,
      as Trustee (in such capacity, the “Second Priority
      Trustee”) and the Second Priority Agent, (c) the First Lien
      Security Agreement dated as of November 29, 2007 (as amended, supplemented,
      restated or otherwise modified from time to time in accordance with the terms
      hereof, the “First Priority Security Agreement”) among
      the Company, certain of the Company’s subsidiaries and the First Priority Agent,
      (d) the Second Lien Security Agreement dated as of November 29, 2007 (as
      amended, supplemented, restated or otherwise modified from time to time in
      accordance with the terms hereof, the “Second Priority Security
      Agreement”) among the Company, certain of the Company’s
      subsidiaries and the Second Priority Agent, (e) the other Loan Documents as
      defined, and referred to, in the First Priority Debt Agreement and (f) the
      other
      Collateral Agreements as defined, and referred to, in the Second Priority Debt
      Agreement.

     

    RECITALS

     

    A.           The
      First Priority Creditors have agreed to make loans and other extensions of
      credit to the Company pursuant to the First Priority Debt Agreement on the
      condition, among others, that the First Priority Claims (such term and each
      other capitalized term used but not defined in the preliminary statement or
      these recitals having the meaning given it in Article I) shall be secured by
      first priority Liens on, and security interests in, the Collateral and the
      Excluded Collateral.

     

    B.           The
      Second Priority Creditors have agreed to purchase and/or hold the Notes issued
      by the Company from time to time pursuant to the Second Priority Debt Agreement
      on the condition, among others, that the Second Priority Claims shall be secured
      by second priority Liens on, and security interests in, the
      Collateral.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    C.           The
      Debt Agreements require, among other things, that the parties thereto set forth
      in this Agreement, among other things, their respective rights, obligations
      and
      remedies with respect to the Collateral.

     

    Accordingly,
      the parties hereto agree as follows:

     

    ARTICLE
      I

     

    Definitions

     

    SECTION
      1.01.  Certain Defined
      Terms.  Capitalized terms used in this Agreement and not
      otherwise defined herein shall, except to the extent the context otherwise
      requires, have the meanings set forth in the Second Priority Debt Agreement
      (as
      in effect on the date hereof) or the Second Priority Security Agreement (as
      in
      effect on the date hereof), as applicable.

     

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

     

    “Bankruptcy
      Code” shall mean Title 11 of the United States Code entitled
“Bankruptcy,” as now and hereinafter in effect, or any successor
      statute.

     

    “Bankruptcy
      Law” shall mean the Bankruptcy Code and any other Federal, state
      or foreign bankruptcy, insolvency, receivership or similar law.

     

    “Capital
      Stock” shall mean:

     

    (1)           in
      the case of a corporation, corporate stock;

     

    (2)           in
      the case of an association or business entity, any and all shares, interests,
      participations, rights or other equivalents (however designated) of corporate
      stock;

     

    (3)           in
      the case of a partnership or limited liability company, partnership or
      membership interests (whether general or limited); and

     

    (4)           any
      other interest or participation that confers on a person or entity the right
      to
      receive a share of the profits and losses of, or distributions of assets of,
      another person or entity that has issued such interest or
      participation.

     

    “Collateral”
      shall mean, collectively, all “Collateral”, as defined in each of the First
      Priority Debt Agreement or any other First Priority Debt Document and the Second
      Priority Debt Agreement or any other Second Priority Debt Document.

     

    “Collateral
      Agents” shall mean the First Priority Agent and the Second
      Priority Agent.

     

    “Company”
      shall have the meaning assigned to such term in the preliminary statement to
      this Agreement.

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    


    “Debt
      Agreements” shall have the meaning assigned to such term in the
      preliminary statement of this Agreement.

     

    “Debt
      Documents” shall mean the First Priority Debt Documents and the
      Second Priority Debt Documents.

     

    “DIP
      Financing” shall have the meaning assigned to such term in Section
      6.01(a).

     

    “DIP
      Financing Liens” shall have the meaning assigned to such term in
      Section 6.01(a).

     

    “Discharge
      of First Priority Claims” shall mean, subject to Sections 7.02 and
      7.04(a), (a) payment in full in cash of the principal of and interest (including
      interest accruing during the pendency of any Insolvency or Liquidation
      Proceeding, regardless of whether allowed or allowable in such Insolvency or
      Liquidation Proceeding) and premium, if any, on all Indebtedness outstanding
      under the First Priority Debt Documents to the extent constituting First
      Priority Claims, (b) cancellation of or the entry into arrangements satisfactory
      to the First Priority Agent and the Issuing Bank with respect to all Letters
      of
      Credit issued and outstanding under the First Priority Debt Agreement and (c)
      termination or expiration of all commitments to lend and all obligations to
      issue or extend Letters of Credit under the First Priority Debt
      Agreement.

     

    “Discharge
      of Second Priority Claims” shall mean, subject to Section 7.04(b),
      (a) payment in full in cash of the principal of and interest (including interest
      accruing during the pendency of any Insolvency or Liquidation Proceeding,
      regardless of whether allowed or allowable in such Insolvency or Liquidation
      Proceeding) and premium, if any, on all Indebtedness outstanding under the
      Second Priority Debt Documents to the extent constituting Second Priority Claims
      and (b) payment in full of all First Priority Claims acquired by the Second
      Priority Agent and/or any of the Second Priority Secured Parties as contemplated
      by Section 10.06 hereof.

     

    “Disposition”
      shall mean any sale, lease, exchange, transfer or other
      disposition.  “Dispose” shall have a
      correlative meaning.

     

    “Excluded
      Collateral” shall mean any Capital Stock of Subsidiaries, whether
      or not such Capital Stock is pledged to secure any First Priority
      Claims.

     

    “First
      Priority Agent” shall have the meaning assigned to such term in
      the preamble to this Agreement.

     

    “First
      Priority Claims” shall mean, at any time, (i) all Indebtedness
      under the First Priority Debt Agreement permitted pursuant to clause (1) of
      the
      definition of “Permitted Debt” in Section 4.09(b) of the Second Priority Debt
      Agreement, and all Obligations (other than principal) related to such
      Indebtedness and owing under the documents relating to such Indebtedness and
      (ii) all Hedging Obligations permitted under such First Priority Debt Agreement
      and secured by the First Priority Liens.

     

    “First
      Priority Collateral” shall mean all “Collateral”, as defined in
      the First Priority Debt Agreement or any other First Priority Debt Document,
      and
      any other assets of any Grantor now or at any time hereafter subject to Liens
      which secure, but only to the extent securing, any First Priority
      Claims.

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    


    “First
      Priority Creditors” shall have the meaning assigned to such term
      in the preliminary statement of this Agreement.

     

    “First
      Priority Debt Agreement” shall have the meaning assigned to such
      term in the preliminary statement of this Agreement.

     

    “First
      Priority Debt Documents” shall mean the “Loan Documents”, as
      defined in the First Priority Debt Agreement.

     

    “First
      Priority Liens” shall mean all Liens on the First Priority
      Collateral to the extent such Liens secure the First Priority Claims, whether
      created under the First Priority Security Documents or acquired by possession,
      statute (including any judgment lien), operation of law, subrogation or
      otherwise.

     

    “First
      Priority Mortgages” shall mean, collectively, each mortgage, deed
      of trust, leasehold mortgage, assignment of leases and rents, modifications
      and
      any other agreement, document or instrument pursuant to which a Lien on real
      property is granted by any Grantor to secure any First Priority Claims or under
      which rights or remedies with respect to any such Lien are
      governed.

     

    “First
      Priority Secured Parties” shall mean, at any time, (a) the First
      Priority Creditors, (b) the First Priority Agent, (c) each other Person to
      whom
      any of the First Priority Claims is owed (including any Affiliate of a First
      Priority Creditor to whom any First Priority Claims of the type described in
      clause (ii) of the definition thereof is owed) and (d) the successors and
      assigns of each of the foregoing.

     

    “First
      Priority Security Agreement” shall have the meaning assigned to
      such term in the preliminary statement of this Agreement.

     

    “First
      Priority Security Documents” shall mean the First Priority Debt
      Agreement, the First Priority Mortgages, the First Priority Security Agreement
      and any other agreement, document or instrument pursuant to which a Lien is
      granted by any Grantor to secure any First Priority Claims or under which rights
      or remedies with respect to any such Lien are governed.

     

    “Grantors”
      shall mean the Company, the Parent and each Subsidiary that shall have created
      or purported to create any First Priority Lien or Second Priority Lien on all
      or
      any part of its assets to secure any First Priority Claims or any Second
      Priority Claims.

     

    “Guarantors”
      shall mean, collectively, the Parent and each Subsidiary that shall have
      guaranteed any First Priority Claims or any Second Priority Claims, whether
      by
      executing and delivering the applicable Debt Agreement, or a separate guaranty
      thereof, or a supplement thereto, or otherwise.

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    


    “Indebtedness”
      shall mean and includes all obligations that constitute “Indebtedness”, as
      defined in the First Priority Debt Agreement or the Second Priority Debt
      Agreement, as applicable.

     

    “Insolvency
      or Liquidation Proceeding” shall mean (a) any voluntary or
      involuntary proceeding under the Bankruptcy Code or any other Bankruptcy Law
      with respect to any Grantor, (b) any voluntary or involuntary appointment of
      a
      receiver, trustee, custodian, sequestrator, conservator or similar official
      for
      any Grantor or for a substantial part of the property or assets of any Grantor,
      (c) any voluntary or involuntary winding-up or liquidation of any Grantor,
      or
      (d) a general assignment for the benefit of creditors by any
      Grantor.

     

    “Inventory”
      means, with respect to any Grantor, all of such Grantor’s now owned or hereafter
      acquired right, title, and interest with respect to inventory, including goods
      held for sale or lease or to be furnished under a contract of service, goods
      that are leased by such Grantor as lessor, goods that are furnished by such
      Grantor under a contract of service, and raw materials, work in process, or
      materials used or consumed in such Grantor’s business.

     

    “Letter
      of Credit” shall have the meaning assigned to such term in the
      First Priority Debt Agreement.

     

    “Lien”
      shall mean, with respect to any asset, any mortgage, lien, pledge, charge,
      security interest or encumbrance of any kind in respect of such asset, whether
      or not filed, recorded or otherwise perfected under applicable law, including
      any conditional sale or other title retention agreement, any lease in the nature
      thereof, any option or other agreement to sell or give a security interest
      in
      and any filing of or agreement to give any financing statement under the Uniform
      Commercial Code (or equivalent statutes) of any jurisdiction other than a
      precautionary financing statement not intended as a security
      agreement.

     

    “Liquidation
      Sale” shall mean a so-called bulk sale, liquidation sale or “going
      out of business sale” conducted either by any Secured Party or a Grantor in
      respect to all or a substantial portion of such Grantor’s Collateral following
      the occurrence and during the continuance of an Event of Default under, and
      as
      defined in, either the First Priority Debt Documents or Second Priority Debt
      Documents.

     

    “New
      First Priority Agent” shall have the meaning assigned to such term
      in Section 7.02.

     

    “New
      First Priority Claims” shall have the meaning assigned to such
      term in Section 7.02.

     

    “New
      First Priority Debt Documents” shall have the meaning assigned to
      such term in Section 7.02.

     

    “Pledged
      or Controlled Collateral” shall have the meaning assigned to such
      term in Article V.

     

    “Refinance”
      shall mean, in respect of any Indebtedness, to refinance, extend, renew,
      restructure (including by the amendment and restatement of any instrument or
      agreement evidencing such Indebtedness) or replace or to issue other
      Indebtedness in exchange or replacement for, such Indebtedness, in whole or
      in
      part.  “Refinanced” and
“Refinancing” shall have correlative
      meanings.

     

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    


    “Refinancing
      Notice” shall have the meaning assigned to such term in Section
      7.02.

     

    “Release”
      shall have the meaning assigned to such term in Section 3.04.

     

    “Second
      Priority Agent” shall have the meaning assigned to such term in
      the preamble to this Agreement.

     

    “Second
      Priority Claims” shall mean the obligations of the Company and the
      Guarantors under or with respect to (i) the Second Priority Debt Agreement,
      (ii)
      the promissory notes from time to time issued under the Second Priority Debt
      Agreement, (iii) any guaranty by a Guarantor of the Second Priority Debt
      Agreement or such promissory notes, or (iv) any other Second Priority Debt
      Document.

     

    “Second
      Priority Collateral” shall mean all “Collateral”, as defined in
      any Second Priority Debt Document, and any other assets of any Grantor now
      or at
      any time hereafter subject to Liens which secure, but only to the extent
      securing, any Second Priority Claims.

     

    “Second
      Priority Creditors” shall mean the “Holders”, as defined in the
      Second Priority Debt Agreement.

     

    “Second
      Priority Debt Agreement” shall have the meaning assigned to such
      term in the preliminary statement of this Agreement.

     

    “Second
      Priority Debt Documents” shall mean the “Indenture Documents”, as
      defined in the Second Priority Debt Agreement.

     

    “Second
      Priority Liens” shall mean all Liens on the Second Priority
      Collateral securing the Second Priority Claims, whether created under the Second
      Priority Security Documents or acquired by possession, statute (including any
      judgment lien), operation of law, subrogation or otherwise.

     

    “Second
      Priority Mortgages” shall mean, collectively, each mortgage, deed
      of trust, leasehold mortgage, assignment of leases and rents, modifications
      and
      any other agreement, document or instrument pursuant to which any Lien on real
      property is granted by any Grantor to secure any Second Priority Claims or
      under
      which rights or remedies with respect to any such Lien are
      governed.

     

    “Second
      Priority Permitted Actions” shall have the meaning assigned to
      such term in Section 3.01(a).

     

    “Second
      Priority Secured Parties” shall mean, at any time, (a) the Second
      Priority Creditors, (b) the Second Priority Trustee, (c) the Second Priority
      Agent, (d) each other Person to whom any of the Second Priority Claims
      (including indemnification obligations) is owed and (e) the successors and
      assigns of each of the foregoing.

     

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    


    “Second
      Priority Security Agreement” shall have the meaning assigned to
      such term in the preliminary statement of this Agreement.

     

    “Second
      Priority Security Documents” shall mean the “Collateral
      Agreements”, as defined in the Second Priority Debt Agreement, including the
      Second Priority Mortgages and the Second Priority Security Agreement, and any
      other agreement, document or instrument pursuant to which a Lien is granted
      by
      any Grantor to secure any Second Priority Claims or under which rights or
      remedies with respect to any such Lien are governed.

     

    “Secured
      Parties” shall mean, as the context may require, the First
      Priority Secured Parties and/or the Second Priority Secured
      Parties.

     

    “Security
      Documents” shall mean the First Priority Security Documents and
      the Second Priority Security Documents.

     

    “Standstill
      Period” shall have the meaning assigned to such term in Section
      3.02(a).

     

    “Subsidiary”
      means:

     

    (1)           any
      corporation, association or other business entity (other than a partnership)
      of
      which more than 50% of the total voting power (without regard to the occurrence
      of any contingency) of Capital Stock is at the time owned or controlled,
      directly or through another Subsidiary, by Parent or one or more of the other
      Subsidiaries of Parent (or a combination thereof); and

     

    (2)           any
      partnership (a) the sole general partner or the managing general partner of
      which is Parent or a Subsidiary of Parent, (b) the only general partners of
      which are Parent or one or more Subsidiaries of Parent (or any combination
      thereof), or (c) as to which Parent and its Subsidiaries are entitled to receive
      more than 50% of the assets of such partnership upon its
      dissolution.

     

    “Uniform
      Commercial Code” or “UCC” shall mean the
      Uniform Commercial Code (or any similar or equivalent legislation) as in effect
      from time to time in any applicable jurisdiction.

     

    SECTION
      1.03.  Terms
      Generally.  The definitions of terms herein shall apply
      equally to the singular and plural forms of the terms
      defined.  Whenever the context may require, any pronoun shall include
      the corresponding masculine, feminine and neuter forms.  The words
“include”, “includes” and “including” shall be deemed to be followed by the
      phrase “without limitation.”  The word “will” shall be construed to
      have the same meaning and effect as the word “shall”.  Unless the
      context requires otherwise (a) any definition of or reference to any agreement,
      instrument or other document herein shall be construed as referring to such
      agreement, instrument or other document as from time to time amended, restated,
      supplemented or otherwise modified, (b) any reference herein (i) to any Person
      shall be construed to include such Person’s successors and assigns and (ii) to
      the Company or any other Grantor shall be construed to include the Company
      or
      such Grantor as debtor and debtor-in-possession and any receiver or trustee
      for
      the Company or any other Grantor, as the case may be, in any Insolvency or
      Liquidation Proceeding or Liquidation Sale, (c) the words “herein”, “hereof” and
“hereunder”, and words of similar import, shall be construed to refer to this
      Agreement in its entirety and not to any particular provision hereof, (d) all
      references herein to Articles or Sections shall be construed to refer to
      Articles or Sections of this Agreement and (e) the words “asset” and “property”
shall be construed to have the same meaning and effect and to refer to any
      and
      all tangible and intangible assets and properties, including cash, securities,
      accounts and contract rights.

     

    
      
        
        

      

      
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    ARTICLE
      II

     

    Lien
      Priorities

     

    SECTION
      2.01.  Relative
      Priorities.  Notwithstanding the date, manner or order
      of grant, attachment or perfection of any Second Priority Lien or any First
      Priority Lien, and notwithstanding any provision of the UCC or any other
      applicable law or the provisions of any Security Document or any other Debt
      Document or any other circumstance whatsoever, each Collateral Agent, for itself
      and on behalf of the Secured Parties on whose behalf it acts in such capacity
      therefor, hereby agrees that so long as the Discharge of First Priority Claims
      has not occurred, (i) any First Priority Lien on any Collateral now or hereafter
      held by or for the benefit of any First Priority Secured Party shall be senior
      in right, priority, operation, effect and all other respects to any and all
      Second Priority Liens on any Collateral and (ii) any Second Priority Lien on
      any
      Collateral now or hereafter held by or for the benefit of any Second Priority
      Secured Party shall be junior and subordinate in right, priority, operation,
      effect and all other respects to any and all First Priority Liens on any
      Collateral.

     

    SECTION
      2.02.  Prohibition on Contesting
      Liens.  Each Collateral Agent, for itself and on behalf
      of the other Secured Parties on whose behalf it acts in such capacity therefor,
      agrees that it will not, and hereby waives any right to, contest or support
      any
      other Person in contesting, in any proceeding (including any Insolvency or
      Liquidation Proceeding), the priority, validity or enforceability of any Second
      Priority Lien or any First Priority Lien, as the case may be; provided that
      nothing in this Agreement shall be construed to prevent or impair the rights
      of
      any Collateral Agent or any other Secured Party to enforce this Agreement to
      the
      extent provided hereby.

     

    SECTION
      2.03.  No New Liens.  The
      parties hereto agree that, so long as the Discharge of First Priority Claims
      has
      not occurred, none of the Grantors shall, nor shall any Grantor permit any
      of
      its subsidiaries to, (i) grant or permit any additional Liens on any asset
      of a
      Grantor to secure any Second Priority Claim unless it has granted, or
      substantially concurrently therewith grants, a Lien on such asset of such
      Grantor to secure the First Priority Claims or (ii) grant or permit any
      additional Liens on any asset of a Grantor (other than Excluded Collateral)
      to
      secure any First Priority Claims unless it has granted, or substantially
      concurrently therewith grants, a Lien on such asset of a Grantor to secure
      the
      Second Priority Claims, with each such Lien to be subject to the provisions
      of
      this Agreement.  To the extent that the provisions of the immediately
      preceding sentence are not complied with for any reason, without limiting any
      other right or remedy available to the First Priority Agent or the other First
      Priority Secured Parties, the Second Priority Agent agrees, for itself and
      on
      behalf of the other Second Priority Secured Parties, that any amounts received
      by or distributed to any Second Priority Secured Party pursuant to or as a
      result of any Lien granted in contravention of this Section 2.03 shall be
      subject to Section 4.02.

     

    
      
        
        

      

      
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    SECTION
      2.04.  Similar
      Collateral.  The parties hereto acknowledge and agree
      that it is their intention that the First Priority Collateral and the Second
      Priority Collateral be identical, except that only the First Priority Collateral
      will include the Excluded Collateral.  In furtherance of the
      foregoing, the parties hereto agree to cooperate in good faith in order to
      determine, upon any reasonable request by the First Priority Agent or the Second
      Priority Agent, the specific assets included in the First Priority Collateral
      and the Second Priority Collateral, the steps taken to perfect the First
      Priority Liens and the Second Priority Liens thereon and the identity of the
      respective parties obligated under the First Priority Debt Documents and the
      Second Priority Debt Documents in respect of the First Priority Claims and
      the
      Second Priority Claims, respectively.

     

    ARTICLE
      III

     

    Enforcement
      of Rights; Matters Relating to Collateral

     

    SECTION
      3.01.  Exercise of Rights and Remedies; Option to
      Purchase.  (a) So long as the Discharge of First
      Priority Claims has not occurred, whether or not any Insolvency or Liquidation
      Proceeding or Liquidation Sale has been commenced, the First Priority Agent
      and
      the other First Priority Secured Parties shall have the exclusive right to
      enforce rights and exercise remedies (including any right of setoff) with
      respect to the Collateral (including making determinations regarding the
      release, Disposition or restrictions with respect to the Collateral), or to
      commence or seek to commence any action or proceeding with respect to such
      rights or remedies (including any foreclosure action or proceeding or any
      Insolvency or Liquidation Proceeding or Liquidation Sale), in each case, without
      any consultation with or the consent of the Second Priority Agent or any other
      Second Priority Secured Party; provided that, notwithstanding the
      foregoing, (i) in any Insolvency or Liquidation Proceeding, the Second Priority
      Agent may file a proof of claim or statement of interest with respect to the
      Second Priority Claims; (ii) the Second Priority Agent may take any action
      to
      preserve or protect the validity and enforceability of the Second Priority
      Liens, provided that no such action is (A) adverse to the First Priority Liens
      or the rights of the First Priority Agent or any other First Priority Secured
      Party to exercise remedies in respect thereof or (B) otherwise inconsistent
      with
      the terms of this Agreement, including the automatic release of Second Priority
      Liens provided in Section 3.04; (iii) the Second Priority Secured
      Parties may file any responsive or defensive pleadings in opposition to any
      motion, claim, adversary proceeding or other pleading made by any Person
      objecting to or otherwise seeking the disallowance of the claims of the Second
      Priority Secured Parties, including any claims secured by the Collateral or
      otherwise make any agreements or file any motions pertaining to the Second
      Priority Claims, in each case, to the extent not inconsistent with the terms
      of
      this Agreement; (iv) the Second Priority Secured Parties may exercise rights
      and
      remedies as unsecured creditors, as provided in Section 3.03(a); and (v) subject
      to Section 3.02, the Second Priority Agent and the other Second Priority Secured
      Parties may enforce any of their rights and exercise any of their remedies
      with
      respect to the Collateral after the termination of the Standstill Period (the
      actions described in this proviso being referred to herein as the
“Second Priority Permitted
      Actions”).  Except for the Second Priority Permitted
      Actions, unless and until the Discharge of First Priority Claims has occurred,
      the sole right of the Second Priority Agent and the other Second Priority
      Secured Parties with respect to the Collateral shall be to receive the proceeds
      of the Collateral, if any, remaining after the Discharge of First Priority
      Claims has occurred and in accordance with the Second Priority Debt Documents
      and applicable law.

     

    
      
        
        

      

      
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    (b)           In
      exercising rights and remedies with respect to the Collateral, the First
      Priority Agent and the other First Priority Secured Parties may enforce the
      provisions of the First Priority Debt Documents and exercise remedies
      thereunder, all in such order and in such manner as they may determine in their
      sole discretion.  Such exercise and enforcement shall include the
      rights of an agent appointed by them to Dispose of Collateral upon foreclosure,
      to incur expenses in connection with any such Disposition and to exercise all
      the rights and remedies of a secured creditor under the Uniform Commercial
      Code,
      the Bankruptcy Code or any other Bankruptcy Law.  The First Priority
      Agent agrees to provide at least ten Business Days’ prior written notice to the
      Second Priority Agent of its intention to foreclose upon or Dispose of any
      Collateral; provided, however, that the failure to give any such notice
      shall not in any way limit its ability to foreclose upon or Dispose of any
      Collateral.

     

    (c)           The
      Second Priority Agent, for itself and on behalf of the other Second Priority
      Secured Parties, hereby acknowledges and agrees that no covenant, agreement
      or
      restriction contained in any Second Priority Security Document or any other
      Second Priority Debt Document shall be deemed to restrict in any way the rights
      and remedies of the First Priority Agent or the other First Priority Secured
      Parties with respect to the Collateral as set forth in this Agreement and the
      other First Priority Debt Documents.

     

    (d)           Notwithstanding
      anything in this Agreement to the contrary, following the acceleration of the
      Indebtedness then outstanding under the First Priority Debt Agreement, the
      Second Priority Secured Parties may (but shall not be obligated to), at their
      sole expense and effort, upon notice to the Company and the First Priority
      Agent, require the First Priority Secured Parties to transfer and assign to
      the
      Second Priority Secured Parties, without warranty or representation or recourse,
      all (but not less than all) of the First Priority Claims; provided that
      (x) such assignment shall not conflict with any law, rule or regulation or
      order
      of any court or other Governmental Authority having jurisdiction, and (y) the
      Second Priority Secured Parties shall have paid to the First Priority Agent,
      for
      the account of the First Priority Secured Parties, in immediately available
      funds, an amount equal to 100% of the principal of such Indebtedness
plus all accrued and unpaid interest thereon plus all accrued
      and unpaid fees plus all the other First Priority Claims then
      outstanding (which shall include, with respect to (i) the aggregate face amount
      of the Letters of Credit outstanding under the First Priority Debt Documents,
      posting cash collateral in an amount equal to 105% thereof, and (ii) each
      commodity or interest rate hedging, cap, collar, swap or other similar agreement
      that evidences any Hedging Obligations included in such First Priority Claims,
      100% of the aggregate amount of such First Priority Claims, after giving effect
      to any netting arrangements, that the applicable Grantor would be required
      to
      pay if such commodity or interest rate hedging, cap, collar, swap or other
      similar agreements were terminated at such time, calculated using the market
      quotation method.  In order to effectuate the foregoing, the First
      Priority Agent shall calculate, upon the written request of the Second Priority
      Agent from time to time, the amount in cash that would be necessary so to
      purchase the First Priority Claims.  If the right set forth in this
      Section 3.01(d) is exercised, the parties shall endeavor to close promptly
      thereafter but in any event within ten Business Days of the request set forth
      in
      the first sentence of this Section 3.01(d).  If the Second Priority
      Secured Parties exercise the right set forth in this Section 3.01(d), it shall
      be exercised pursuant to documentation mutually acceptable to each of the First
      Priority Agent and the Second Priority Agent.

     

    
      
        
        

      

      
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    (e)           In
      exercising rights and remedies with respect to the Collateral, the Second
      Priority Agent may enforce the provisions of the Second Priority Debt Documents
      and exercise remedies thereunder, all in such order and in such manner as it
      may
      determine in its sole discretion, in each case, to the extent that such
      enforcement or exercise is not otherwise prohibited by clauses (a) through
      (d)
      of this Section 3.01.  Such exercise and enforcement shall, in each
      case, to the extent that such enforcement or exercise is not otherwise
      prohibited by clauses (a) through (d) of this Section 3.01, include the rights
      of an agent appointed by it to Dispose of Collateral upon foreclosure, to incur
      expenses in connection with any such Disposition and to exercise all the rights
      and remedies of a secured creditor under the Uniform Commercial Code, the
      Bankruptcy Code or any other Bankruptcy Law.  The Second Priority
      Agent agrees to provide at least ten Business Days’ prior written notice to the
      First Priority Agent of its intention to foreclose upon or Dispose of any
      Collateral; provided, however, that the failure to give any such notice shall
      not in any way limit its ability to foreclose upon or Dispose of any Collateral
      to the extent that such foreclosure is not otherwise prohibited by clauses
      (a)
      through (d) of this Section 3.01.

     

    SECTION
      3.02.  No
      Interference.  The Second Priority Agent, for itself and
      on behalf of the other Second Priority Secured Parties, agrees that, whether
      or
      not any Insolvency or Liquidation Proceeding or Liquidation Sale has been
      commenced, the Second Priority Secured Parties:

     

    (a)           except
      for Second Priority Permitted Actions, will not, so long as the Discharge of
      First Priority Claims has not occurred, (A) enforce or exercise, or seek to
      enforce or exercise, any rights or remedies (including any right of setoff)
      with
      respect to any Collateral (including the enforcement of any right under any
      account control agreement, landlord waiver or bailee’s letter or any similar
      agreement or arrangement to which the Second Priority Agent or any other Second
      Priority Secured Party is a party) or (B) commence or join with any Person
      (other than the First Priority Agent) in commencing, or petition for or vote
      in
      favor of any resolution for, any action or proceeding with respect to such
      rights or remedies (including any foreclosure action); provided,
      however, that the Second Priority Agent may enforce or exercise any or all
      such rights and remedies, or commence, join with any Person in commencing,
      or
      petition for or vote in favor of any resolution for, any such action or
      proceeding, after a period of 90 days has elapsed (which period shall be tolled
      during any period in which the First Priority Agent shall not be entitled to
      enforce or exercise any rights or remedies with respect to any Collateral as
      a
      result of (x) any injunction issued by a court of competent jurisdiction or
      (y)
      the automatic stay or any other stay in any Insolvency or Liquidation
      Proceeding) since the date on which the Second Priority Agent has delivered
      to
      the First Priority Agent written notice of the acceleration of the Indebtedness
      then outstanding under the Second Priority Debt Agreement (the
“Standstill Period”); provided further,
      however, that (1) notwithstanding the expiration of the Standstill Period
      or anything herein to the contrary, in no event shall the Second Priority Agent
      or any other Second Priority Secured Party enforce or exercise any rights or
      remedies with respect to any Collateral, or commence, join with any Person
      at
      any time in commencing, or petition for or vote in favor of any resolution
      for,
      any such action or proceeding, if the First Priority Agent or any other First
      Priority Secured Party shall have commenced, and shall be diligently pursuing
      (or shall have sought or requested relief from or modification of the automatic
      stay or any other stay in any Insolvency or Liquidation Proceeding to enable
      the
      commencement and pursuit thereof), the enforcement or exercise of any rights
      or
      remedies with respect to any material portion of the Collateral or any such
      action or proceeding (prompt written notice thereof to be given to the Second
      Priority Agent by the First Priority Agent) and (2) after the expiration of
      the
      Standstill Period, so long as neither the First Priority Agent nor the First
      Priority Secured Parties have commenced any action to enforce their Lien on
      any
      material portion of the Collateral, in the event that and for so long as the
      Second Priority Secured Parties (or the Second Priority Agent on their behalf)
      have commenced any actions to enforce their Liens with respect to any material
      portion of the Collateral to the extent permitted hereunder and are diligently
      pursuing such actions, neither the First Priority Secured Parties nor the First
      Priority Agent shall take any action of a similar nature with respect to such
      Collateral; provided that all other provisions of this Intercreditor
      Agreement (including the turnover provisions of Article IV) are complied
      with;

     

    
      
        
        

      

      
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    (b)           will
      not contest, protest or object to any foreclosure action or proceeding brought
      by the First Priority Agent or any other First Priority Secured Party, or any
      other enforcement or exercise by any First Priority Secured Party of any rights
      or remedies relating to the Collateral under the First Priority Debt Documents
      or an Insolvency or Liquidation Proceeding or in connection with a Liquidation
      Sale or otherwise, so long as Second Priority Liens attach to the proceeds
      thereof subject to the relative priorities set forth in Section
      2.01(a);

     

    (c)           subject
      to the rights of the Second Priority Secured Parties under clause (i) above,
      will not object to the forbearance by the First Priority Agent or any other
      First Priority Secured Party from commencing or pursuing any foreclosure action
      or proceeding or any other enforcement or exercise of any rights or remedies
      with respect to the Collateral;

     

    (d)           will
      not, so long as the Discharge of First Priority Claims has not occurred and
      except for Second Priority Permitted Actions, take or receive any Collateral,
      or
      any proceeds thereof or payment with respect thereto, in connection with the
      exercise of any right or enforcement of any remedy (including any right of
      setoff) with respect to any Collateral or in connection with any insurance
      policy award under a policy of insurance relating to any Collateral or any
      condemnation award (or deed in lieu of condemnation) relating to any
      Collateral;

     

    (e)           will
      not, except for Second Priority Permitted Actions, take any action that would,
      or could reasonably be expected to, hinder, in any manner, any exercise of
      remedies under the First Priority Debt Documents, including any Disposition
      of
      any Collateral, whether by foreclosure or otherwise;

     

    (f)           will
      not, except for Second Priority Permitted Actions, object to the manner in
      which
      the First Priority Agent or any other First Priority Secured Party may seek
      to
      enforce or collect the First Priority Claims or the First Priority Liens,
      regardless of whether any action or failure to act by or on behalf of the First
      Priority Agent or any other First Priority Secured Party is, or could be,
      adverse to the interests of the Second Priority Secured Parties, and will not
      assert, and hereby waive, to the fullest extent permitted by law, any right
      to
      demand, request, plead or otherwise assert or claim the benefit of any
      marshalling, appraisal, valuation or other similar right that may be available
      under applicable law with respect to the Collateral or any similar rights a
      junior secured creditor may have under applicable law; and

     

    
      
        
        

      

      
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    (g)           will
      not attempt, directly or indirectly, whether by judicial proceeding or
      otherwise, to challenge or question the validity or enforceability of any First
      Priority Claim or any First Priority Security Document, including this
      Agreement, or the validity or enforceability of the priorities, rights or
      obligations established by this Agreement.

     

    SECTION
      3.03.  Rights as Unsecured
      Creditors.  The Second Priority Agent and the other
      Second Priority Secured Parties may, in accordance with the terms of the Second
      Priority Debt Documents and applicable law, enforce rights and exercise remedies
      against any Grantor as unsecured creditors; provided that no such
      action is otherwise inconsistent with the terms of this
      Agreement.  Without limiting the generality of the foregoing sentence,
      the Second Priority Secured Parties shall be entitled to prosecute litigation
      against any Grantor or any other Person liable in respect of the Second Priority
      Claims, notwithstanding whether any Standstill Period is then in effect, but
      shall be prohibited from taking any action to enforce any judgment until the
      lapse of any applicable Standstill Period.  Nothing in this Agreement
      shall prohibit the receipt by the Second Priority Agent or any other Second
      Priority Secured Party of the required payments of principal, premium, interest,
      fees and other amounts due under the Second Priority Debt Documents so long
      as
      such receipt is not the direct or indirect result of the enforcement or exercise
      by the Second Priority Agent or any other Second Priority Secured Party of
      rights or remedies in contravention of this Agreement as a secured creditor
      (including any right of setoff) against Collateral or enforcement in
      contravention of this Agreement of any Second Priority Lien against Collateral
      (including any judgment lien resulting from the exercise of remedies available
      to an unsecured creditor).

     

    SECTION
      3.04.  Automatic Release of Second Priority
      Liens.

     

    (a)           
      If, in connection with (i) any Disposition of any Collateral permitted under
      the
      terms of the First Priority Debt Documents or (ii) the enforcement or exercise
      of any rights or remedies with respect to the Collateral, including any
      Disposition of Collateral, the First Priority Agent, for itself and on behalf
      of
      the other First Priority Secured Parties, (x) releases any of the First Priority
      Liens, or (y) releases any Guarantor (other than the Parent) from its
      obligations under its guarantee of the First Priority Claims (in each case,
      a
“Release”), other than any such Release granted
      following (and not as a condition to) the Discharge of First Priority Claims,
      then the Second Priority Liens on such Collateral, and the obligations of such
      Guarantor under its guarantee of the Second Priority Claims, shall be
      automatically, unconditionally and simultaneously released, and the Second
      Priority Agent shall, for itself and on behalf of the other Second Priority
      Secured Parties, promptly execute and deliver to the First Priority Agent,
      the
      relevant Grantor or such Guarantor such termination statements, releases and
      other documents as the First Priority Agent or the relevant Grantor or Guarantor
      may reasonably request to effectively confirm such Release.

     

    (b)           Until
      the Discharge of First Priority Claims occurs, the Second Priority Agent, for
      itself and on behalf of each other Second Priority Secured Party, hereby
      appoints the First Priority Agent, and any officer or agent of the First
      Priority Agent, with full power of substitution, as the attorney-in-fact of
      each
      Second Priority Secured Party for the purpose of carrying out the provisions
      of
      this Section 3.04 and taking any action and executing any instrument that the
      First Priority Agent may deem necessary or advisable to accomplish the purposes
      of this Section 3.04 (including any endorsements or other instruments of
      transfer or release), which appointment is irrevocable and coupled with an
      interest but may only be exercised if the First Priority Agent requests that
      the
      Second Priority Agent (or applicable Second Priority Secured Party) execute
      such
      instrument and such request is declined.

     

    
      
        
        

      

      
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    SECTION
      3.05.  Automatic Release of First Priority
      Liens.  If, in connection with the enforcement or
      exercise of any rights or remedies with respect to the Collateral after the
      expiration of the Standstill Period that is permitted in accordance with clause
      (2) of the second proviso to Section 3.02(a), including any Disposition of
      Collateral, the Second Priority Agent, for itself and on behalf of the other
      Second Priority Secured Parties, (x) releases any of the Second Priority Liens,
      or (y) releases any Guarantor from its obligations under its guarantee of the
      Second Priority Claims (in each case, a “Second Priority
      Release”), then the First Priority Liens on such Collateral, and
      the obligations of such Guarantor under its guarantee of the First Priority
      Claims, shall be automatically, unconditionally and simultaneously released,
      and
      the First Priority Agent shall, for itself and on behalf of the other First
      Priority Secured Parties, promptly execute and deliver to the Second Priority
      Agent, the relevant Grantor or such Guarantor such termination statements,
      releases and other documents as the Second Priority Agent or the relevant
      Grantor or Guarantor may reasonably request to effectively confirm such release;
      provided that so long as the Discharge of First Priority Claims has not
      occurred, the proceeds of, or payments with respect to, any Second Priority
      Release that are received by the Second Priority Agent or any other Second
      Priority Secured Party, shall be segregated and held in trust and forthwith
      transferred or paid over to the First Priority Agent for the benefit of the
      First Priority Secured Parties in accordance with Section 4.02; provided
      further, however, that the First Priority Lender shall not be obligated to
      release the First Priority Liens on any Collateral in connection with any sale
      or other Disposition of Collateral to a Second Priority Secured Party or an
      affiliate thereof or any other transaction other than a sale of such Collateral
      to a third Person with respect to which at least 75% of the consideration
      therefor consists of cash and cash equivalents.

     

    SECTION
      3.06.  Insurance and Condemnation
      Awards.  So long as the Discharge of First Priority
      Claims has not occurred, the First Priority Agent and the other First Priority
      Secured Parties shall have the exclusive right, subject to the rights of the
      Grantors under the First Priority Debt Documents, to settle and adjust claims
      in
      respect of Collateral under policies of insurance covering Collateral and to
      approve any award granted in any condemnation or similar proceeding, or any
      deed
      in lieu of condemnation, in respect of the Collateral.  All proceeds
      of any such policy and any such award, or any payments with respect to a deed
      in
      lieu of condemnation, shall (a) first, prior to the Discharge of First Priority
      Claims and subject to the rights of the Grantors under the First Priority Debt
      Documents, be paid to the First Priority Agent for the benefit of First Priority
      Secured Parties pursuant to the terms of the First Priority Debt Documents,
      (b)
      second, after the Discharge of First Priority Claims and subject to the rights
      of the Grantors under the Second Priority Debt Documents, be paid to the Second
      Priority Agent for the benefit of the Second Priority Secured Parties pursuant
      to the terms of the Second Priority Debt Documents, and (c) third, be paid
      to
      the owner of the subject property or as a court of competent jurisdiction may
      otherwise direct.  Until the Discharge of First Priority Claims has
      occurred, if the Second Priority Agent or any other Second Priority Secured
      Party shall, at any time, receive any proceeds of any such insurance policy
      or
      any such award or payment, it shall transfer and pay over such proceeds to
      the
      First Priority Agent in accordance with Section 4.02.

     

    
      
        
        

      

      
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    SECTION
      3.07.  Notification of Release of
      Collateral.  Each of the First Priority Agent and the
      Second Priority Agent shall give the other prompt written notice of the
      Disposition by it of, and Release by it of the Lien on, any
      Collateral.  Such notice shall describe in reasonable detail the
      subject Collateral, the parties involved in such Disposition or Release, the
      place, time manner and method thereof, and the consideration, if any, received
      therefor; provided, however, that the failure to give any such notice
      shall not in and of itself in any way impair the effectiveness of any such
      Disposition or Release.

     

    ARTICLE
      IV

     

    Payments

     

    SECTION
      4.01.  Application of
      Proceeds.  Any Collateral or proceeds thereof received
      by any Secured Party in connection with any Disposition of, or collection on,
      such Collateral upon the enforcement or exercise of any right or remedy
      (including any right of setoff) will be applied as follows:

     

    first,
      to
      the payment of costs and expenses of the applicable Secured Party in connection
      with such enforcement or exercise;

     

    second,
      after all such costs and expenses have been paid in full in cash, to the payment
      of the First Priority Claims in accordance with the First Priority Debt
      Documents;

     

    third,
      after all such costs and expenses have been paid in full in cash and the
      Discharge of First Priority Claims has occurred, to the payment of the Second
      Priority Claims, and

     

    fourth,
      after all such costs and expenses have been paid in full in cash, the Discharge
      of First Priority Claims has occurred, and the Discharge of Second Priority
      Claims has occurred, any surplus Collateral or proceeds then remaining will
      be
      returned to the Company, the applicable Guarantor or to whosoever may be
      lawfully entitled to receive the same or as a court of competent jurisdiction
      may direct.

     

    SECTION
      4.02.  Payment Over.  So
      long as the Discharge of First Priority Claims has not occurred, any Collateral
      or any proceeds thereof (together with assets or proceeds subject to Liens
      referred to in the final sentence of Section 2.03) received by the Second
      Priority Agent or any other Second Priority Secured Party in connection with
      any
      Disposition of, or collection on, such Collateral upon the enforcement or the
      exercise of any right or remedy (including any right of setoff) with respect
      to
      the Collateral, or in connection with any insurance policy claim or any
      condemnation award (or deed in lieu of condemnation) with respect to the
      Collateral, shall be segregated and held in trust and forthwith transferred
      or
      paid over to the First Priority Agent for the benefit of the First Priority
      Secured Parties in the same form as received, together with any necessary
      endorsements, or as a court of competent jurisdiction may otherwise
      direct.  Until the Discharge of First Priority Claims occurs, the
      Second Priority Agent, for itself and on behalf of each other Second Priority
      Secured Party, hereby appoints the First Priority Agent, and any officer or
      agent of the First Priority Agent, with full power of substitution, the
      attorney-in-fact of each Second Priority Secured Party for the purpose of
      carrying out the provisions of this Section 4.02 and taking any action and
      executing any instrument that the First Priority Agent may deem necessary or
      advisable to accomplish the purposes of this Section 4.02, which appointment
      is
      irrevocable and coupled with an interest.

     

    
      
        
        

      

      
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    SECTION
      4.03.  Certain Agreements with Respect to
      Unenforceable Liens.  Notwithstanding anything to the
      contrary contained herein, if in any Insolvency or Liquidation Proceeding a
      determination is made that any Lien encumbering any Collateral is not
      enforceable for any reason, then the Second Priority Agent and the Second
      Priority Secured Parties agree that, any distribution or recovery they may
      receive with respect to, or allocable to, the value of the assets constituting
      Collateral subject to an enforceable Lien in favor of the Second Priority
      Secured Parties or any proceeds thereof shall (for so long as the Discharge
      of
      First Priority Claims has not occurred) be segregated and held in trust and
      forthwith paid over to the First Priority Agent for the benefit of the First
      Priority Secured Parties in the same form as received without recourse,
      representation or warranty (other than a representation of the Second Priority
      Agent that it has not otherwise sold, assigned, transferred or pledged any
      right, title or interest in and to such distribution or recovery) but with
      any
      necessary endorsements or as a court of competent jurisdiction may otherwise
      direct.  Until the Discharge of First Priority Claims occurs, the
      Second Priority Agent, for itself and on behalf of each other Second Priority
      Secured Party, hereby appoints the First Priority Agent, and any officer or
      agent of the First Priority Agent, with full power of substitution, the
      attorney-in-fact of each Second Priority Secured Party for the limited purpose
      of carrying out the provisions of this Section 4.03 and taking any action and
      executing any instrument that the First Priority Agent may deem necessary or
      advisable to accomplish the purposes of this Section 4.03, which appointment
      is
      irrevocable and coupled with an interest.

     

    ARTICLE
      V

     

    Bailment
      for Perfection of Certain Security Interests

     

    (a)           The
      parties agree that if the First Priority Agent shall at any time hold a First
      Priority Lien on any Collateral that can be perfected or the priority of which
      can be enhanced by the possession or control of such Collateral or of any
      account in which such Collateral is held, and if such Collateral or any such
      account is in fact in the possession or under the control of the First Priority
      Agent, or of agents or bailees of the First Priority Agent (such Collateral
      being referred to herein as the “Pledged or Controlled
      Collateral”), the First Priority Agent shall, solely for the
      purpose of perfecting the Second Priority Liens granted under the Second
      Priority Debt Documents and subject to the terms and conditions of this Article
      V, also (i) hold and/or maintain control of such Pledged or Controlled
      Collateral as gratuitous bailee for and representative (as defined in Section
      1-201(35) of the Uniform Commercial Code as in effect in the State of New York)
      of, or as agent for, the Second Priority Agent, (ii) with respect to any
      securities accounts included in the Collateral, have “control” (within the
      meaning of Section 8-106(d)(3) of the UCC) of such securities accounts on behalf
      of the Second Priority Agent and (iii) with respect to any deposit accounts
      included in the Collateral, act as agent for the Second Priority Agent and
      any
      assignee.

     

    
      
        
        

      

      
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    (b)           So
      long as the Discharge of First Priority Claims has not occurred, the First
      Priority Agent shall be entitled to deal with the Pledged or Controlled
      Collateral in accordance with the terms of this Agreement and the other First
      Priority Debt Documents as if the Second Priority Liens did not
      exist.  The obligations and responsibilities of the First Priority
      Agent to the Second Priority Agent and the other Second Priority Secured Parties
      under this Article V shall be limited solely to holding or controlling the
      Pledged or Controlled Collateral as gratuitous bailee and representative (as
      defined in Section 1 201(35) of the Uniform Commercial Code as in effect in
      the
      State of New York)  in accordance with this Article
      V.  Without limiting the foregoing, the First Priority Agent shall
      have no obligation or responsibility to ensure that any Pledged or Controlled
      Collateral is genuine or owned by any of the Grantors.  The First
      Priority Agent acting pursuant to this Article V shall not, by reason of this
      Agreement, any other Security Document or any other document, have a fiduciary
      relationship in respect of any other First Priority Secured Party, the Second
      Priority Agent or any other Second Priority Secured Party.

     

    (c)           Upon
      the Discharge of First Priority Claims, the First Priority Agent shall transfer
      the possession and control of the Pledged or Controlled Collateral, together
      with any necessary endorsements but without recourse or warranty, to the Second
      Priority Agent, and if no Second Priority Claims are outstanding at such time,
      to the applicable Grantor, in each case so as to allow such Person to obtain
      possession and control of such Pledged or Controlled Collateral.  In
      connection with any transfer under the immediately preceding sentence, the
      First
      Priority Agent agrees, at the expense of the Grantors, to take all actions
      in
      its power as shall be reasonably requested by the Second Priority Agent to
      permit the Second Priority Agent to obtain, for the benefit of the Second
      Priority Secured Parties, a first priority security interest in the Pledged
      or
      Controlled Collateral.

     

    (d)           After
      the Discharge of First Priority Claims and upon the Discharge of Second Priority
      Claims, the Second Priority Agent shall transfer the possession and control
      of
      the Pledged or Controlled Collateral, together with any necessary endorsements
      but without recourse or warranty, to the applicable Grantor, in each case so
      as
      to allow such Person to obtain possession and control of such Pledged or
      Controlled Collateral.

     

    ARTICLE
      VI

     

    Insolvency
      or Liquidation Proceedings

     

    SECTION
      6.01.  Finance and Sale
      Matters.  (a) Until the Discharge of First Priority
      Claims has occurred, the Second Priority Agent, for itself and on behalf of
      the
      other Second Priority Secured Parties, and subject to the provisions of Section
      6.01(c), agrees that, in the event of any Insolvency or Liquidation Proceeding,
      the Second Priority Secured Parties:

     

    (i)           will
      not oppose or object to the use of any Collateral constituting cash collateral
      under Section 363 of the Bankruptcy Code, or any comparable provision of any
      other Bankruptcy Law, unless the First Priority Secured Parties, or a
      representative authorized by the First Priority Secured Parties, shall oppose
      or
      object to such use of cash collateral;

     

    
      
        
        

      

      
        -17-

        
          

        

      

      
        
        

      

    

     

    (ii)           will
      not oppose or object to any post-petition financing provided to any Grantor,
      whether provided by the First Priority Secured Parties or any other Person,
      under Section 364 of the Bankruptcy Code, or any comparable provision of any
      other Bankruptcy Law (a “DIP Financing”), or the Liens
      securing any DIP Financing (“DIP Financing Liens”),
      unless the First Priority Secured Parties, or a representative authorized by
      the
      First Priority Secured Parties, shall then oppose or object to such DIP
      Financing or such DIP Financing Liens, and, to the extent that such DIP
      Financing Liens are senior to, or rank pari passu with, the First
      Priority Liens on the Collateral, the Second Priority Agent will, for itself
      and
      on behalf of the other Second Priority Secured Parties, subordinate the Second
      Priority Liens on the Collateral to the First Priority Liens on the Collateral,
      if applicable, and the DIP Financing Liens on the terms of this Agreement;
      provided that, notwithstanding anything herein to the contrary, the
      Second Priority Secured Parties retain their rights under the Bankruptcy Code
      to
      make post-petition financing proposals and such proposals shall not be deemed
      to
      be an objection to any other DIP Financing proposals so long as (x) any court
      order approving such post-petition financing requires that the First Priority
      Claims be paid in full in cash as a condition to such post-petition financing,
      and (y) the First Priority Claims are paid in full in cash on the date of such
      post-petition financing, which date shall be no later than 10 days after the
      date on which such post-petition financing is approved by the court in which
      such Insolvency or Liquidation Proceeding is pending;

     

    (iii)           except
      to the extent permitted by paragraph (b) of this Section 6.01, in connection
      with the use of cash collateral as described in clause (i) above or a DIP
      Financing, will not request adequate protection with respect to any Collateral
      or any other relief in connection with such use of cash collateral, DIP
      Financing or DIP Financing Liens; and

     

    (iv)           will
      not oppose or object to any Disposition of any Collateral free and clear of
      the
      Second Priority Liens or other claims under Section 363 of the Bankruptcy Code,
      or any comparable provision of any other Bankruptcy Law, if the First Priority
      Secured Parties, or a representative authorized by the First Priority Secured
      Parties, shall consent to such Disposition free and clear of First Priority
      Liens.

     

    (b)           The
      Second Priority Agent, for itself and on behalf of the other Second Priority
      Secured Parties, agrees that no Second Priority Secured Party shall contest,
      or
      support any other Person in contesting, (i) any request by the First Priority
      Agent or any other First Priority Secured Party for adequate protection in
      respect of any First Priority Claims or (ii) any objection, based on a claim
      of
      a lack of adequate protection with respect of any First Priority Claims, by
      the
      First Priority Agent or any other First Priority Secured Party to any motion,
      relief, action or proceeding.  Notwithstanding the immediately
      preceding sentence, if, in connection with any DIP Financing or use of cash
      collateral, (A) any First Priority Secured Party seeks or requests adequate
      protection in the form of a Lien on additional collateral, the Second Priority
      Agent may, for itself and on behalf of the other Second Priority Secured
      Parties, seek or request adequate protection in the form of a Lien on such
      additional collateral, which Lien will be subordinated to the First Priority
      Liens and DIP Financing Liens on the same basis as the other Second Priority
      Liens are subordinated to the First Priority Liens under this Agreement or
      (B)
      any Second Priority Secured Party is granted adequate protection in the form
      of
      a Lien on additional collateral, the First Priority Agent shall, for itself
      and
      on behalf of the other First Priority Secured Parties, be granted adequate
      protection in the form of a Lien on such additional collateral that is senior
      to
      such Second Priority Lien as security for the First Priority
      Claims.

     

    
      
        
        

      

      
        -18-

        
          

        

      

      
        
        

      

    

     

    (c)           Notwithstanding
      the foregoing, the applicable provisions of Section 6.01(a) and (b) shall only
      be binding on the Second Priority Secured Parties with respect to any DIP
      Financing to the extent the principal amount of such DIP Financing, when taken
      together with the aggregate principal amount of the First Priority Claims
      (which, in each case, for the avoidance of doubt shall not include any First
      Priority Claims of the type described in clause (ii) of the definition thereof),
      does not exceed the sum of (i) the amount of Indebtedness at the time permitted
      to be outstanding pursuant to clause (1) of the definition of “Permitted Debt”
in Section 4.09(b) of the Second Priority Debt Document, and (ii)
      $5,000,000.

     

    SECTION
      6.02.  Relief from the Automatic
      Stay.  The Second Priority Agent, for itself and on
      behalf of the other Second Priority Secured Parties, agrees that, so long as
      the
      Discharge of First Priority Claims has not occurred, no Second Priority Secured
      Party shall, without the prior written consent of the First Priority Agent,
      seek
      or request relief from or modification of the automatic stay or any other stay
      in any Insolvency or Liquidation Proceeding in respect of any part of the
      Collateral, any proceeds thereof or any Second Priority Lien on the
      Collateral.

     

    SECTION
      6.03.  Reorganization
      Securities.  If, in any Insolvency or Liquidation
      Proceeding, debt obligations of the reorganized debtor secured by Liens upon
      any
      property of the reorganized debtor are distributed, pursuant to a plan of
      reorganization or similar dispositive restructuring plan, on account of the
      First Priority Claims and the Second Priority Claims, then, to the extent the
      debt obligations distributed on account of the First Priority Claims, on account
      of the Second Priority Claims are secured by Liens upon the same assets or
      property, the provisions of this Agreement will survive the distribution of
      such
      debt obligations pursuant to such plan and will apply with like effect to the
      Liens securing such debt obligations.

     

    SECTION
      6.04.  Post-Petition
      Interest.  (a) The Second Priority Agent, for itself and
      on behalf of the other Second Priority Secured Parties, agrees that no Second
      Priority Secured Party shall oppose or seek to challenge any claim by the First
      Priority Agent or any other First Priority Secured Party for allowance in any
      Insolvency or Liquidation Proceeding of First Priority Claims consisting of
      post-petition interest, fees or expenses to the extent of the value of the
      First
      Priority Liens (it being understood and agreed that such value shall be
      determined without regard to the existence of the Second Priority Liens on
      the
      Collateral).

     

    (b)           The
      First Priority Agent, for itself and on behalf of the other First Priority
      Secured Parties, agrees that the Second Priority Agent or any other Second
      Priority Secured Party may make a claim for allowance in any Insolvency or
      Liquidation Proceeding of Second Priority Claims consisting of post-petition
      interest, fees or expenses to the extent of the value of the Second Priority
      Liens; provided, however, that if the First Priority Secured Parties
      shall have made any such claim, such claim (A) shall have also have been
      approved or (B) shall have been approved prior to, or will be approved
      contemporaneous with, the approval of any such claim by any Second Priority
      Secured Party.

     

    
      
        
        

      

      
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    SECTION
      6.05.  Certain Waivers by the Second Priority
      Secured Parties.  The Second Priority Agent, for itself
      and on behalf of the other Second Priority Secured Parties, waives any claim
      any
      Second Priority Secured Party may hereafter have against any First Priority
      Secured Party arising out of (a) the election by any First Priority Secured
      Party of the application of Section 1111(b)(2) of the Bankruptcy Code, or any
      comparable provision of any other Bankruptcy Law, or (b) any use of cash
      collateral or financing arrangement, or any grant of a security interest in
      the
      Collateral, in any Insolvency or Liquidation Proceeding.

     

    SECTION
      6.06.  Certain Voting
      Matters.  Each of the First Priority Agent, on behalf of
      the First Priority Secured Parties and the Second Priority Agent on behalf
      of
      the Second Priority Secured Parties, agrees that, without the written consent
      of
      the other, it will not seek to vote with the other as a single class in
      connection with any plan of reorganization in any Insolvency or Liquidation
      Proceeding.  Except as provided in this Section 6.06, nothing in this
      Agreement is intended, or shall be construed, to limit the ability of the Second
      Priority Agent or the Second Priority Secured Parties to vote on any plan of
      reorganization that maintains the lien subordination provisions of this
      Agreement or of either the First Priority Secured Parties or Second Priority
      Secured Parties, to contest any plan of reorganization that does not maintain
      the lien subordination provisions of this Agreement.

     

    ARTICLE
      VII

     

    Other
      Agreements

     

    SECTION
      7.01.  Matters Relating to Debt
      Documents.  (a) Each of the Company and the Second
      Priority Agent agrees that the Second Priority Debt Agreement and each Second
      Priority Security Document shall contain the applicable provisions set forth
      on
      Annex I hereto, or similar provisions approved by the First Priority Agent,
      which approval shall not be unreasonably withheld or delayed.  Each of
      the Company and the Second Priority Agent further agrees that each Second
      Priority Mortgage covering any Collateral shall contain such other language
      as
      the First Priority Agent may reasonably request to reflect the subordination
      of
      such Second Priority Mortgage to the First Priority Security Document covering
      such Collateral pursuant to this Agreement.

     

    SECTION
      7.02.  Effect of Refinancing of Indebtedness under
      First Priority Debt Documents.  If, substantially
      contemporaneously with the Discharge of First Priority Claims, the Grantors
      Refinance Indebtedness outstanding under the First Priority Debt Documents
      and
      provided that (a) such Refinancing is permitted hereby and (b) the Company
      gives
      to the Second Priority Agent written notice (the “Refinancing
      Notice”) electing the application of the provisions of this
      Section 7.02 to such Refinancing Indebtedness, then (i) such Discharge of First
      Priority Claims shall automatically be deemed not to have occurred for all
      purposes of this Agreement, (ii) such Refinancing Indebtedness and all other
      obligations under the documents evidencing such Indebtedness (the
“New First Priority Claims”) shall automatically be
      treated as First Priority Claims for all purposes of this Agreement, including
      for purposes of the Lien priorities and rights in respect of Collateral set
      forth herein, (iii) the Debt Agreement and the other documents evidencing such
      Refinancing Indebtedness (the “New First Priority Debt
      Documents”) shall automatically be treated as the First Priority
      Debt Agreement and the First Priority Debt Documents and, in the case of New
      First Priority Debt Documents that are security documents pursuant to which
      any
      Grantor has granted a Lien to secure any New First Priority Claim, as the First
      Priority Security Documents for all purposes of this Agreement, (iv) the
      collateral agent under the New First Priority Debt Documents (the
“New First Priority Agent”) shall be deemed to be the
      First Priority Agent for all purposes of this Agreement and (v) the lenders
      under the New First Priority Debt Documents shall be deemed to be the First
      Priority Creditors for all purposes of this Agreement.  Upon receipt
      of a Refinancing Notice, which notice shall include the identity of the New
      First Priority Agent, the Second Priority Agent shall promptly enter into such
      documents and agreements (including amendments or supplements to this Agreement)
      as the Company or such New First Priority Agent may reasonably request in order
      to provide to the New First Priority Agent the rights and powers contemplated
      hereby, in each case consistent in all material respects with the terms of
      this
      Agreement.  The Company shall cause the agreement, document or
      instrument pursuant to which the New First Priority Agent is appointed to
      provide that the New First Priority Agent agrees to be bound by the terms of
      this Agreement.  In furtherance of Section 2.03, if the New First
      Priority Claims are secured by assets of the Grantors (other than Excluded
      Collateral) that do not also secure the Second Priority Claims, the applicable
      Grantors shall promptly grant a Second Priority Lien on such assets to secure
      the Second Priority Claims.

     

    
      
        
        

      

      
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    SECTION
      7.03.  No Waiver by First Priority Secured
      Parties.  Other than with respect to the Second Priority
      Permitted Actions, nothing contained herein shall prohibit or in any way limit
      the First Priority Agent or any other First Priority Secured Party from
      opposing, challenging or objecting to, in any Insolvency or Liquidation
      Proceeding or otherwise, any action taken, or any claim made, by the Second
      Priority Agent or any other Second Priority Secured Party, including any request
      by the Second Priority Agent or any other Second Priority Secured Party for
      adequate protection or any exercise by the Second Priority Agent or any other
      Second Priority Secured Party of any of its rights and remedies under the Second
      Priority Debt Documents or otherwise.

     

    SECTION
      7.04.  Reinstatement.  If,
      in any Insolvency or Liquidation Proceeding or otherwise, all or part of any
      payment with respect to the First Priority Claims previously made shall be
      rescinded for any reason whatsoever, then the First Priority Claims shall be
      reinstated to the extent of the amount so rescinded and, if theretofore
      terminated, this Agreement shall be reinstated in full force and effect and
      such
      prior termination shall not diminish, release, discharge, impair or otherwise
      affect the Lien priorities and the relative rights and obligations of the First
      Priority Secured Parties and the Second Priority Secured Parties provided for
      herein.

     

    SECTION
      7.05.  Authorization of Collateral
      Agents.  By accepting the benefits of this Agreement and
      the other First Priority Security Documents, each First Priority Secured Party
      hereby authorizes the First Priority Agent to enter into this Agreement and
      to
      act on its behalf as collateral agent hereunder and in connection
      herewith.  By accepting the benefits of this Agreement and the other
      Second Priority Security Documents, each Second Priority Secured Party hereby
      authorizes the Second Priority Agent to enter into this Agreement and to act
      on
      its behalf as collateral agent hereunder and in connection
      herewith.

     

    
      
        
        

      

      
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    SECTION
      7.06.  Further
      Assurances.  Each of the First Priority Agent, for
      itself and on behalf of the other First Priority Secured Parties, and the Second
      Priority Agent, for itself and on behalf of the other Second Priority Secured
      Parties, and each Grantor party hereto, for itself and on behalf of its
      subsidiaries, agrees that it will execute, or will cause to be executed, any
      and
      all further documents, agreements and instruments, and take all such further
      actions, as may be required under any applicable law, or which the First
      Priority Agent or the Second Priority Agent may reasonably request, to
      effectuate the terms of this Agreement, including the relative Lien priorities
      provided for herein.

     

    ARTICLE
      VIII

     

    Representations
      and Warranties

     

    SECTION
      8.01.  Representations and Warranties of Each
      Party.  Each party hereto represents and warrants to the
      other parties hereto as follows:

     

    (a)           Such
      party is duly organized, validly existing and in good standing under the laws
      of
      the jurisdiction of its organization and has all requisite power and authority
      to execute and deliver this Agreement and perform its obligations
      hereunder.

     

    (b)           This
      Agreement has been duly executed and delivered by such party and constitutes
      a
      legal, valid and binding obligation of such party, enforceable in accordance
      with its terms.

     

    (c)           The
      execution, delivery and performance by such party of this Agreement (i) do
      not
      require any consent or approval of, registration or filing with or any other
      action by any governmental authority (except as contemplated hereby) and (ii)
      will not violate any provision of law, statute, rule or regulation, or of the
      certificate or articles of incorporation or other constitutive documents or
      by-laws of such party or any order of any governmental authority or any
      provision of any indenture, agreement or other instrument applicable to or
      binding upon such party.

     

    SECTION
      8.02.  Representations and Warranties of Each
      Collateral Agent.  Each Collateral Agent represents and
      warrants to the other parties hereto that it has been authorized by the Secured
      Parties under and as defined in the First Priority Debt Agreement or the Second
      Priority Security Agreement, as applicable, to enter into this
      Agreement.

     

    ARTICLE
      IX

     

    No
      Reliance; No Liability; Obligations Absolute

     

    SECTION
      9.01.  No Reliance;
      Information.  The First Priority Secured Parties and the
      Second Priority Secured Parties shall have no duty to disclose to any Second
      Priority Secured Party or to any First Priority Secured Party, respectively,
      any
      information relating to the Company or any of the Grantors, or any other
      circumstance bearing upon the risk of nonpayment of any of the First Priority
      Claims or the Second Priority Claims, as the case may be, that is known or
      becomes known to any of them or any of their Affiliates.  In the event
      any First Priority Secured Party or any Second Priority Secured Party, in its
      sole discretion, undertakes at any time or from time to time to provide any
      such
      information to, respectively, any Second Priority Secured Party or any First
      Priority Secured Party, it shall be under no obligation (i) to make, and shall
      not make or be deemed to have made, any express or implied representation or
      warranty, including with respect to the accuracy, completeness, truthfulness
      or
      validity of the information so provided, (ii) to provide any additional
      information or to provide any such information on any subsequent occasion or
      (iii) to undertake any investigation.

     

    
      
        
        

      

      
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    SECTION
      9.02.  No Warranties or
      Liability. (a) The First Priority Agent, for itself and on
      behalf of the other First Priority Secured Parties, acknowledges and agrees
      that, except for the representations and warranties set forth in Article VIII,
      neither the Second Priority Agent nor any other Second Priority Secured Party
      has made any express or implied representation or warranty, including with
      respect to the execution, validity, legality, completeness, collectibility
      or
      enforceability of any of the Second Priority Debt Documents, the ownership
      of
      any Collateral or the perfection or priority of any Liens
      thereon.  The Second Priority Agent, for itself and on behalf of the
      other Second Priority Secured Parties, acknowledges and agrees that, except
      for
      the representations and warranties set forth in Article VIII, neither the First
      Priority Agent nor any other First Priority Secured Party has made any express
      or implied representation or warranty, including with respect to the execution,
      validity, legality, completeness, collectibility or enforceability of any of
      the
      First Priority Debt Documents, the ownership of any Collateral or the perfection
      or priority of any Liens thereon.

     

    (b)           The
      Second Priority Agent and the other Second Priority Secured Parties shall have
      no express or implied duty to the First Priority Agent or any other First
      Priority Secured Party, and the First Priority Agent and the other First
      Priority Secured Parties shall have no express or implied duty to the Second
      Priority Agent or any other Second Priority Secured Party, to act or refrain
      from acting in a manner which allows, or results in, the occurrence or
      continuance of a default or an event of default under any First Priority Debt
      Document and any Second Priority Debt Document (other than, in each case, this
      Agreement), regardless of any knowledge thereof which they may have or be
      charged with.

     

    (c)           The
      Second Priority Agent, for itself and on behalf of the other Second Priority
      Secured Parties, agrees no First Priority Secured Party shall have any liability
      to the Second Priority Agent or any other Second Priority Secured Party, and
      hereby waives any claim against any First Priority Secured Party, arising out
      of
      any and all actions which the First Priority Agent or the other First Priority
      Secured Parties may take or permit or omit to take with respect to (i) the
      First
      Priority Debt Documents (other than this Agreement), (ii) the collection of
      the
      First Priority Claims or (iii) the maintenance of, the preservation of, the
      foreclosure upon or the Disposition of any Collateral.

     

    SECTION
      9.03.  Obligations
      Absolute.  The Lien priorities provided for herein and
      the respective rights, interests, agreements and obligations hereunder of the
      First Priority Agent and the other First Priority Secured Parties and the Second
      Priority Agent and the other Second Priority Secured Parties shall remain in
      full force and effect irrespective of:

     

    (a)           any
      lack of validity or enforceability of any Debt Document;

     

    
      
        
        

      

      
        -23-

        
          

        

      

      
        
        

      

    

     

    (b)           any
      change in the time, place or manner of payment of, or in any other term of
      (including, subject to the limitations set forth in Section 7.01(a), the
      Refinancing of), all or any portion of the First Priority Claims, it being
      specifically acknowledged that a portion of the First Priority Claims consists
      or may consist of Indebtedness that is revolving in nature, and the amount
      thereof that may be outstanding at any time or from time to time may be
      increased or reduced and subsequently reborrowed;

     

    (c)           any
      change in the time, place or manner of payment of, or, subject to the
      limitations set forth in Section 7.01(a), in any other term of, all or any
      portion of the First Priority Claims;

     

    (d)           any
      amendment, waiver or other modification, whether by course of conduct or
      otherwise, of any Debt Document;

     

    (e)           the
      securing of any First Priority Claims or Second Priority Claims with any
      additional collateral or guarantees, or any exchange, release, voiding,
      avoidance or non perfection of any security interest in any Collateral or any
      other collateral or any release of any guarantee securing any First Priority
      Claims or Second Priority Claims;

     

    (f)           the
      commencement of any Insolvency or Liquidation Proceeding or Liquidation Sale
      in
      respect of the Company or any other Grantor; or

     

    (g)           any
      other circumstances that otherwise might constitute a defense available to,
      or a
      discharge of, the Company or any other Grantor in respect of the First Priority
      Claims or this Agreement, or any of the Second Priority Secured Parties in
      respect of this Agreement.

     

    ARTICLE
      X

     

    Miscellaneous

     

    SECTION
      10.01.  Notices.  Notices
      and other communications provided for herein shall be in writing and shall
      be
      delivered by hand or overnight courier service, mailed by certified or
      registered mail or sent by fax, as follows:

     

    (a)           if
      to the Company or any other Grantor, to it, at Gastar Exploration USA, Inc.,
      1331 Lamar Street, Suite 1080, Houston, Texas  77010,
      Attention:  Treasurer, (Fax No. (713) 739-0458);

     

    (b)           if
      to the First Priority Agent, to Amegy Bank National Association, as Agent,
      4400
      Post Oak Parkway, 4th Floor,
      Houston,
      Texas 77027, Attention: Energy Lending Dept. (Fax No. (713) 651-0345);
      and

     

    (c)           if
      to the Second Priority Agent, to Wells Fargo Bank, National Association, as
      Agent, 1445 Ross Avenue, 2nd Floor,
      Dallas,
      Texas 75202-2812, Attention:  Corporate Trust Services (Fax No. (214)
      777-4086).

     

    All
      notices and other communications given to any party hereto in accordance with
      the provisions of this Agreement shall be deemed to have been given on the
      date
      of receipt if delivered by hand or overnight courier service or sent by fax
      or
      on the date five Business Days after dispatch by certified or registered mail
      if
      mailed, in each case delivered, sent or mailed (properly addressed) to such
      party as provided in this Section 10.01 or in accordance with the latest
      unrevoked direction from such party given in accordance with this Section
      10.01.  As agreed to between the Company and any Collateral Agent from
      time to time, notices and other communications may also be delivered by e-mail
      to the e-mail address of a representative of the applicable Person provided
      from
      time to time by such Person.

     


    
      
        
        

      

      
        -24-

        
          

        

      

      
        
        

      

    

     

    The
      First
      Priority Lender and the Second Priority Agent agree to use diligent efforts
      to
      provide each other with copies of any notices of default or acceleration or
      similar notices which they give to the Borrower under the First Priority Debt
      Documents and Second Priority Debt Documents respectively; provided, however,
      that in the event that either of such parties fails to provide the other with
      such notice, such failure shall not affect their respective obligations
      hereunder or the effectiveness of any such notice.

     

    SECTION
      10.02.  Conflicts.  IN
      THE EVENT OF ANY CONFLICT OR INCONSISTENCY BETWEEN THE PROVISIONS OF THIS
      AGREEMENT AND THE PROVISIONS OF THE OTHER DEBT DOCUMENTS, THE PROVISIONS OF
      THIS
      AGREEMENT SHALL CONTROL.

     

    SECTION
      10.03.  Effectiveness; Survival;
      Termination.  This Agreement shall become effective when
      executed and delivered by the parties hereto.  All covenants,
      agreements, representations and warranties made by any party in this Agreement
      shall be considered to have been relied upon by the other parties hereto and
      shall survive the execution and delivery of this Agreement.  The terms
      of this Agreement shall survive, and shall continue in full force and effect,
      in
      any Insolvency or Liquidation Proceeding.  The Second Priority Agent,
      for itself and on behalf of the other Second Priority Secured Parties, hereby
      waives any and all rights the Second Priority Secured Parties may now or
      hereafter have under applicable law to revoke this Agreement or any of the
      provisions of this Agreement.  This Agreement shall terminate and be
      of no further force and effect, (i) subject to compliance with its obligations
      to take certain actions upon Discharge of the Second Priority Claims pursuant
      to
      Article V and Section 3.01(d), with respect to the Second Priority Agent, the
      Second Priority Secured Parties and the Second Priority Claims, upon the later
      of (1) the date upon which the obligations under the Second Priority Debt
      Agreement terminate if there are no other Second Priority Claims outstanding
      on
      such date and (2) if there are other Second Priority Claims outstanding on
      such
      date, the date upon which such Second Priority Claims terminate and (ii) subject
      to Section 7.02 and compliance with its obligations to take certain actions
      upon
      Discharge of the First Priority Claims pursuant to Article V, with respect
      to
      the First Priority Agent, the First Priority Secured Parties and the First
      Priority Claims, the date of Discharge of First Priority Claims, subject to
      the
      rights of the First Priority Secured Parties under Section 7.04.

     

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

     

    
      
        
        

      

      
        -25-

        
          

        

      

      
        
        

      

    

     

    SECTION
      10.05.  Amendments;
      Waivers.  (a) No failure or delay on the part of any
      party hereto in exercising any power or right hereunder shall operate as a
      waiver thereof, nor shall any single or partial exercise of any such right
      or
      power, or any abandonment or discontinuance of steps to enforce such a right
      or
      power, preclude any other or further exercise thereof or the exercise of any
      other right or power.  The rights and remedies of the parties hereto
      are cumulative and are not exclusive of any rights or remedies that they would
      otherwise have.  No waiver of any provision of this Agreement or
      consent to any departure by any party therefrom shall in any event be effective
      unless the same shall be permitted by paragraph (b) of this Section 10.05,
      and
      then such waiver or consent shall be effective only in the specific instance
      and
      for the purpose for which given.

     

    (b)           Neither
      this Agreement nor any provision hereof may be waived, amended or modified
      except pursuant to an agreement or agreements in writing entered into by the
      First Priority Agent and the Second Priority Agent; provided that no such
      agreement shall amend, modify or otherwise affect the rights or obligations
      of
      any Grantor without such Person’s prior written consent.

     

    SECTION
      10.06.  Postponement of
      Subrogation.  The Second Priority Agent agrees that no
      payment or distribution to any First Priority Secured Party pursuant to the
      provisions of this Agreement shall entitle any Second Priority Secured Party
      to
      exercise any rights of subrogation in respect thereof until the Discharge of
      First Priority Claims shall have occurred.  Following the Discharge of
      First Priority Claims, each First Priority Secured Party agrees to execute
      such
      documents, agreements, and instruments as any Second Priority Secured Party
      may
      reasonably request to evidence the transfer by subrogation to any such Person
      of
      an interest in the First Priority Claims resulting from payments or
      distributions to such First Priority Secured Party by such Person, so long
      as
      all costs and expenses (including all reasonable legal fees and disbursements)
      incurred in connection therewith by such First Priority Secured Party are paid
      by such Person upon request for payment thereof.

     

    SECTION
      10.07.  Applicable Law; Jurisdiction; Consent to
      Service of Process.  (a) THIS AGREEMENT SHALL BE
      CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK,
      WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THAT WOULD REQUIRE THE APPLICATION
      OF THE LAWS OF ANOTHER JURISDICTION.

     

    (b)           Each
      party hereto hereby irrevocably and unconditionally submits, for itself and
      its
      property, to the non-exclusive jurisdiction of any Supreme Court for New York
      County, New York or in The United States District Court for the Southern
      District of New York, and any appellate court from any thereof, in any action
      or
      proceeding arising out of or relating to this Agreement, or for recognition
      or
      enforcement of any judgment, and each of the parties hereto hereby irrevocably
      and unconditionally agrees that all claims in respect of any such action or
      proceeding may be heard and determined only in such New York court or, to the
      extent permitted by law, in such Federal court.  Each party hereto
      agrees that a final judgment in any such action or proceeding shall be
      conclusive and may be enforced in other jurisdictions by suit on the judgment
      or
      in any other manner provided by law.

     

    
      
        
        

      

      
        -26-

        
          

        

      

      
        
        

      

    

     

    (c)           Each
      party hereto hereby irrevocably and unconditionally waives, to the fullest
      extent it may legally and effectively do so, any objection which it may now
      or
      hereafter have to the laying of venue of any suit, action or proceeding arising
      out of or relating to this Agreement in any New York court or in any such
      Federal court.  Each party hereto hereby irrevocably waives, to the
      fullest extent permitted by law, the defense of an inconvenient forum to the
      maintenance of such action or proceeding in any such court.

     

    (d)           Each
      party to this Agreement irrevocably consents to service of process in the manner
      provided for notices in Section 10.01.  Nothing in this Agreement will
      affect the right of any party to this Agreement to serve process in any other
      manner permitted by law.

     

    SECTION
      10.08.  Waiver of Jury
      Trial.  EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST
      EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY
      IN
      RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN
      CONNECTION WITH THIS AGREEMENT.  EACH PARTY HERETO (A) CERTIFIES THAT
      NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
      EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
      LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT
      IT
      AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT,
      BY,
      AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION
      10.08.

     

    SECTION
      10.09.  Parties in
      Interest.  The provisions of this Agreement shall be
      binding upon and inure to the benefit of the parties hereto and their respective
      successors and assigns, as well as the other First Priority Secured Parties
      and
      Second Priority Secured Parties, all of whom are intended to be bound by, and
      to
      be third party beneficiaries of, this Agreement.  No other Person
      shall have or be entitled to assert rights or benefits hereunder.

     

    SECTION
      10.10.  Specific
      Performance.  Each Collateral Agent may demand specific
      performance of this Agreement and, on behalf of itself and the respective other
      Secured Parties, hereby irrevocably waives any defense based on the adequacy
      of
      a remedy at law and any other defense that might be asserted to bar the remedy
      of specific performance in any action which may be brought by the respective
      Secured Parties.

     

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

     

    SECTION
      10.12.  Counterparts.  This
      Agreement may be executed in counterparts (and by different parties hereto
      on
      different counterparts), each of which shall constitute an original but all
      of
      which when taken together shall constitute a single contract, and shall become
      effective as provided in Section 10.03.  Delivery of an executed
      signature page to this Agreement by facsimile transmission shall be as effective
      as delivery of a manually signed counterpart of this Agreement.

     

    
      
        
        

      

      
        -27-

        
          

        

      

      
        
        

      

    

     

    SECTION
      10.13.  Provisions Solely to Define Relative
      Rights.  The provisions of this Agreement are and are
      intended solely for the purpose of defining the relative rights of the First
      Priority Secured Parties, on the one hand, and the Second Priority Secured
      Parties, on the other hand.  None of the Company, any other Grantor,
      any Guarantor or any other creditor thereof shall have any rights or
      obligations, except as expressly provided in this Agreement hereunder and none
      of the Company, any other Grantor or any Guarantor may rely on the terms
      hereof.  Nothing in this Agreement is intended to or shall impair the
      obligations of the Company or any other Grantor or any Guarantor, which are
      absolute and unconditional, to pay the First Priority Claims and the Second
      Priority Claims as and when the same shall become due and payable in accordance
      with their terms.

     

    (Signatures
      appear on following pages)

     

    
      
        
        

      

      
        -28-

        
          

        

      

      
        
        

      

    


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

     

    
      	 	
              COMPANY: 

            
	 	 	 
	 	 GASTAR
              EXPLORATION USA, INC., a Michigan corporation
	 	 	 
	 	 	 
	 	
              By:

            	
              /s/
                MICHAEL A. GERLICH

            
	 	 	
              Michael
                A. Gerlich

            
	 	 	
              Secretary
                and Treasurer

            
	 	 	 
	 	 	 
	 	GUARANTORS:
	 	 	 
	 	GASTAR
              EXPLORATION LTD., an Alberta, Canada corporation
	 	 	 
	 	 	 
	 	
              By:

            	
              /s/
                MICHAEL A. GERLICH

            
	 	 	
              Michael
                A. Gerlich

            
	 	 	
              Vice
                President and

            
	 	 	
              Chief
                Financial Officer

            
	 	 	 
	 	 	 
	 	GASTAR
              EXPLORATION NEW SOUTH WALES, INC. a Michigan corporation
	 	 	 
	 	 	 
	 	
              By:

            	
              /s/
                MICHAEL A. GERLICH

            
	 	 	
              Michael
                A. Gerlich

            
	 	 	
              Secretary
                and Treasurer

            
	 	 	 
	 	 	 
	 	GASTAR
              EXPLORATION VICTORIA, INC. a Michigan corporation
	 	 	 
	 	 	 
	 	
              By:

            	
              /s/
                MICHAEL A. GERLICH

            
	 	 	
              Michael
                A. Gerlich

            
	 	 	
              Secretary
                and Treasurer

            


    

     

    (Signatures
      continue on following pages)

     

    
      
        
        

      

      
        -29-

        
          

        

      

      
        
        

      

    

    


    
      	 	GASTAR
              EXPLORATION TEXAS, INC., a Michigan corporation
	 	 	 
	 	 	 
	 	
              By:

            	
              /s/
                MICHAEL A. GERLICH

            
	 	 	
              Michael
                A. Gerlich

            
	 	 	
              Secretary
                and Treasurer

            
	 	 	 
	 	 	 
	 	GASTAR
              EXPLORATION TEXAS, LLC, a Delaware limited liability company
	 	 	 
	 	 	 
	 	
              By:

            	
              /s/
                MICHAEL A. GERLICH

            
	 	 	
              Michael
                A. Gerlich

            
	 	 	
              Secretary
                and Treasurer

            
	 	 	 
	 	 	 
	 	GASTAR
              EXPLORATION TEXAS, LP,
	 	 	 
	 	
              By:

            	
              GASTAR
                EXPLORATION TEXAS LLC, its General Partner

            
	 	 	 
	 	 	 
	 	
               

            	
              By:

            	/s/
              MICHAEL A. GERLICH
	 	 	
               

            	Michael
              A. Gerlich
	 	 	
               

            	Secretary
              and Treasurer


    

     

    (Signatures
      continue on following pages)

     

    
      
        
        

      

      
        -30-

        
          

        

      

      
        
        

      

    

    


    
      	 	FIRST
              PRIORITY AGENT:
	 	 	 
	 	AMEGY
              BANK NATIONAL ASSOCIATION, as First Priority Agent
	 	 	 
	 	 	 
	 	
              By:

            	
              /s/
                W. BRYAN CHAPMAN

            
	 	 	
              W.
                Bryan Chapman

            
	 	 	
              Senior
                Vice President

            


    

     

    (Signature
      continues on following page)

     

    
      
        
        

      

      
        -31-

        
          

        

      

      
        
        

      

    

    


    
      	 	SECOND
              PRIORITY AGENT
	 	 	 
	 	WELLS
              FARGO BANK, NATIONAL ASSOCIATION, as Second Priority Agent
	 	 	 
	 	
              By:

            	
              /s/
                PATRICK GIORDANO

            
	 	 	
              Patrick
                Giordano

            
	 	 	
              Vice
                President

            


    


    
      
        
        

      

      
        -32-

        
          

        

      

      
        
        

      

    


    Provision
      for the Second Priority Debt Agreement

     

    THIS
      INDENTURE AND THE COLLATERAL AGREEMENTS ARE SUBJECT TO THE TERMS, LIMITATIONS
      AND CONDITIONS SET FORTH IN THE INTERCREDITOR AGREEMENT.  THE TRUSTEE,
      THE COMPANY AND EACH HOLDER OF A NOTE, BY ITS ACCPETANCE THEREOF, IS DEEMED
      TO
      HAVE AUTHORIZED AND INSTRUCTED THE COLLATERAL AGENT TO ENTER INTO THE
      INTERCREDITOR AGREEMENT ON ITS BEHALF.

     

    Provision
      for the Second Priority Security Documents

     

    “REFERENCE
      IS MADE TO THE INTERCREDITOR AGREEMENT DATED AS OF NOVEMBER 29, 2007 (AS
      AMENDED, SUPPLEMENTED, RESTATED OR OTHERWISE MODIFIED FROM TIME TO TIME, THE
      “INTERCREDITOR AGREEMENT”), AMONG THE COMPANY, THE SUBSIDIARIES OF THE
      COMPANY FROM TIME TO TIME PARTY THERETO, AMEGY BANK NATIONAL ASSOCIATION, AS
      FIRST PRIORITY AGENT (AS DEFINED THEREIN), AND WELLS FARGO BANK, NATIONAL
      ASSOCIATION, AS SECOND PRIORITY AGENT (AS DEFINED
      THEREIN).  NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, THE LIEN
      AND SECURITY INTEREST GRANTED TO THE COLLATERAL AGENT, FOR THE BENEFIT OF THE
      SECURED PARTIES, PURSUANT TO THIS AGREEMENT AND THE EXERCISE OF ANY RIGHT OR
      REMEDY BY THE COLLATERAL AGENT AND THE OTHER SECURED PARTIES HEREUNDER ARE
      SUBJECT TO THE PROVISIONS OF THE INTERCREDITOR AGREEMENT.  IN THE
      EVENT OF ANY CONFLICT OR INCONSISTENCY BETWEEN THE PROVISIONS OF THE
      INTERCREDITOR AGREEMENT AND THE PROVISIONS OF THIS AGREEMENT OR THE OTHER
      INDENTURE DOCUMENTS, THE PROVISIONS OF THE INTERCREDITOR AGREEMENT SHALL
      CONTROL.”

     

     

     -33-