Document:

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AMENDMENT NO. 1 TO 

FINANCING AGREEMENT

AMENDMENT NO. 1, dated as of June 1, 2005 (this "Amendment"), to the Financing Agreement, dated as of January 31, 2005 (the "Financing Agreement"), by and among Oglebay Norton Company, an Ohio corporation (the "Parent"), each subsidiary of the Parent listed as a "Borrower" on the signature pages to the Financing Agreement (together with the Parent, each a "Borrower" and collectively, the "Borrowers"), each subsidiary of the Parent listed as a "Guarantor" on the signature pages to the Financing Agreement (each a "Guarantor" and collectively the "Guarantors", and together with the Borrowers, each a "Loan Party" and collectively, the "Loan Parties"), the lenders from time to time party thereto (each a "Lender" and collectively, the "Lenders"), Silver Point Finance, LLC, a Delaware limited liability company, as collateral agent and syndication agent for the Lenders and as lead arranger (in such capacities, together with its successors and assigns in such capacities, if any, the "Collateral Agent"), Wells Fargo Foothill, Inc., a California corporation, as administrative agent for the Lenders (in such capacity, together with its successors and assigns in such capacity, if any the "Administrative Agent"), and JPMorgan Chase Bank and Bank of America, N.A, each as a documentation agent for the Lenders (in such capacity, together with their respective successors and assigns in such capacity, if any, each a "Documentation Agent" and collectively, the "Documentation Agents").

Preamble

The Borrowers, the Guarantors, the Lenders and the Agents wish to amend the Financing Agreement.  Accordingly, the parties hereto hereby agree as follows:

	Definitions.  All terms used herein which are defined in the Financing Agreement and not otherwise defined herein shall have the meanings assigned to them in the Financing Agreement.  

	Preamble.  The preamble to the Financing Agreement is hereby amended and restated in its entirety to read as follows: 

"Financing Agreement, dated as of January 31, 2005, by and among Oglebay Norton Company, an Ohio corporation (the "Parent"), Erie Navigation Company, a Pennsylvania corporation ("Erie Navigation"), Erie Sand and Gravel Company, a Pennsylvania corporation ("Erie Sand and Gravel"), Erie Sand Steamship Co., a Delaware corporation ("Erie Steamship"), O-N Minerals (Chemstone) Company (formerly known as Global Stone Chemstone Corporation), a Delaware corporation ("GS Chemstone"), O-N Minerals (Filler Products) Company (formerly known as Global Stone Filler Products, Inc.), a Delaware corporation ("GS Filler"), O-N Minerals (James River) Company (formerly known as Global Stone James River, Inc.), a Delaware corporation ("GS James River"), O-N Minerals (PenRoc) Company LP (formerly known as Global Stone PenRoc LP), a Pennsylvania limited partnership ("GS PenRoc"), O-N Minerals (Portage) Company LLC (formerly known as Global Stone Portage, LLC), an Indiana limited partnership ("GS Portage"), O-N Minerals (St. Clair) Company (formerly known as Global Stone St. Clair Inc.), a Delaware corporation ("GS St. Clair"), O-N Minerals (Luttrell) Company (formerly known as Global Stone Tenn Luttrell Company), a Delaware corporation ("GS Tenn Luttrell"), O-N Minerals (Michigan) Company (formerly known as Michigan Limestone Operations, Inc.), a Michigan corporation ("Michigan Limestone"), O-N Minerals (Erie) Company (formerly known as Mountfort Terminal, Ltd.), a Pennsylvania corporation ("Mountfort"), Oglebay Norton Industrial Sands, Inc., a California corporation ("ON Industrial Sands"), Oglebay Norton Marine Services Company, L.L.C., a Delaware limited liability company ("Marine Services"), Oglebay Norton Specialty Minerals, Inc., an Ohio  corporation ("ON Specialty"), O-N Minerals (Terminals) Company (formerly known as Oglebay Norton Terminals, Inc.), an Ohio corporation ("ON Terminals"), Texas Mining, LP, a Delaware limited partnership ("Texas Mining" and together with the Parent, Erie Navigation, Erie Sand and Gravel, Erie Steamship, GS Chemstone, GS Filler, GS James River, GS PenRoc, GS Portage, GS St. Clair, GS Tenn Luttrell, Michigan Limestone, Mountfort, ON Industrial Sands, Marine Services, ON Specialty and ON Terminals, each a "Borrower" and collectively, the "Borrowers"), each subsidiary of the Parent listed as a "Guarantor" on the signature pages hereto (each a "Guarantor" and collectively, the "Guarantors"), the lenders from time to time party hereto (each a "Lender" and collectively, the "Lenders"), Silver Point Finance, LLC, a Delaware limited liability company ("Silver Point"), as collateral agent and syndication agent for the Lenders and as lead arranger (in such capacities, together with its successors and assigns in such capacities, if any, the "Collateral Agent"), Wells Fargo Foothill, Inc., a California corporation ("Foothill"), as administrative agent for the Lenders (in such capacity, together with its successors and assigns in such capacity, if any, the "Administrative Agent" and together with the Collateral Agent, each an "Agent" and collectively, the "Agents"), and JPMorgan Chase Bank and Bank of America, N.A., each as a documentation agent for the Lenders (in such capacity, together with their respective successors and assigns in such capacity, if any, each a "Documentation Agent" and collectively, the "Documentation Agents")."

	New Definitions.  Section 1.01 of the Financing Agreement is hereby amended by adding the following definitions, in appropriate alphabetical order:

" 'Disposition Reinvestment Proceeds' has the meaning specified therefor in Section 2.05(c)(viii)." 

" 'First Amendment' means Amendment No. 1 to Financing Agreement, dated as of June 1, 2005, among the Loan Parties, the Agents and the Lenders."

" 'First Amendment Effective Date' means the date on which the First Amendment shall become effective in accordance with its terms." 

' "Fixed Charge Coverage Ratio Condition' shall exist if:

(a)all of the following shall occur: (i) the Specified Legislation Enactment Date shall have occurred, (ii) the Parent or any of its Subsidiaries makes any payment to any trust fund or to any Governmental Authority as a result of the implementation of the Specified Legislation (the annual amount of such payment, a "Specified Legislation Payment"), and (iii) the Fixed Charge Coverage Ratio of the Parent and its Subsidiaries as of the end of the mostly recently completed period of four (4) consecutive fiscal quarters ended immediately prior to such Specified Legislation Payment for which there are available financial statements, such ratio calculated on a pro forma basis giving effect to any such Specified Legislation Payment is less than the Fixed Charge Coverage Ratio of the Parent and its Subsidiaries otherwise required to be maintained on such date pursuant to Section 8.03(c) plus .25 or more; or

(b) all of the following shall occur: (i) the Specified Legislation Enactment Date shall have occurred, (ii) the Specified Legislation obligates Parent or any of its Subsidiaries to make a payment, (iii) neither the Parent nor any of its Subsidiaries has made such payment pursuant to the Specified Legislation by reason of either an appeal of, or similar judicial or administrative proceeding with respect to (including, without limitation, any application or petition for adjustment, reduction or elimination of the cash payment due to the applicable governmental trust fund or other Governmental Authority), (A) the Specified Legislation or (B) the obligation of the Parent or any of its Subsidiaries to make such payment under the Specified Legislation, (iv) the earlier of (A) the first anniversary date of the Specified Legislation Enactment Date has occurred, or (B) the date on which such appeal or proceeding specified in clause (iii) above shall have been determined by the applicable Governmental Authority (the earlier of (A) or (B), the "Specified Legislation Appeal Testing Date") and (v) the Fixed Charge Coverage Ratio of the Parent and its Subsidiaries as of the end of the mostly recently completed period of four (4) consecutive fiscal quarters ended immediately prior to the Specified Legislation Appeal Testing Date for which there are available financial statements, such ratio calculated on a pro forma basis giving effect to the amount of any Specified Legislation Payment that is required to be made as of the Specified Legislation Appeal Testing Date, or if any such appeal or proceeding is still pending, the amount of such payment required to be made but for such appeal or proceeding, is less than the Fixed Charge Coverage Ratio of the Parent and its Subsidiaries otherwise required to be maintained on such date pursuant to Section 8.03(c) plus .25 or more.  

For the avoidance of doubt, (x) for illustrative purposes only, the condition described in clauses (a)(iii) and (b)(v) above will have occurred with respect to the testing period ending March 31, 2007 if the Fixed Charge Coverage Ratio of the Parent and its Subsidiaries, calculated as provided in clauses (a)(iii) or (b)(v) above, as the case may be, is less than 1.95 to 1.0 and (y) any additional interest required to be paid as a result of a Fixed Charge Coverage Ratio Condition shall be deemed earned on the applicable Specified Legislation Interest Triggering Date."

" 'Leverage Ratio' means, with respect to any Person for any period, the ratio of (i) the sum of (without duplication) (A) all indebtedness of such Person and its Subsidiaries for borrowed money, (B) all obligations of such Person and its Subsidiaries evidenced by bonds, debentures, notes or other similar instruments or upon which interest payments are customarily made, (C) the principal portion of all Capitalized Lease Obligations of such Person and its Subsidiaries, (D) all Contingent Obligations of such Person and its Subsidiaries (to the extent relating to indebtedness or obligations of the types referred to in clauses (A), (B), or (C) above), and (E) all obligations referred to in clauses (A) through (D) of this clause (i) of another Person secured by (or for which the holder of such obligations has an existing right, contingent or otherwise, to be secured by) a Lien upon property owned by such Person, even though such Person has not assumed or become liable for the payment of such obligations on the last day of such period to (ii) Consolidated EBITDA of such Person and its Subsidiaries for such period.  In determining the Leverage Ratio the indebtedness and obligations of the type referred to in clause (i) above of any Person shall include the indebtedness and obligations of any partnership of or joint venture in which such Person is a general partner or a joint venturer to the extent such Person is liable for such indebtedness and obligations." 

" 'Permitted Vessel Financing Indebtedness' means Indebtedness of a Loan Party that owns one or more Vessels incurred in connection with a financing arrangement made by a Person to such Loan Party, provided that (a) the amount of Indebtedness extended or committed to be extended pursuant to such financing arrangement shall not exceed 75% of the appraised value of such Vessel or Vessels, which appraised value shall be determined based upon the most recent appraisal of such Vessel or Vessels delivered to the Agents, which appraisal shall be in form and substance satisfactory to the Agents and shall be performed by an independent appraiser reasonably satisfactory to the Agents, (b) such Indebtedness may be secured only by a Lien on such Vessel or Vessels subject to such financing arrangement (and the proceeds thereof) and such Lien shall not extend to or cover any other property of any Loan Party or any of its Subsidiaries, and (c) all of the Net Cash Proceeds from such financing arrangement shall be applied to the prepayment of the Term Loans in accordance with Section 2.05(c)(vi) and Section 2.05(d)(iv)." 

" 'Post-Disposition Leverage Ratio' has the meaning specified therefor in Section 2.05(c)(viii)."

" 'Pre-Disposition Leverage Ratio' has the meaning specified therefor in Section 2.05(c)(viii)."

" 'Preferred Stock Buyback Amount' means $5,000,000."

" 'Specified Legislation' means the proposed Senate Bill 852, known as the Fairness in Asbestos Injury Resolution (FAIR) Act of 2005, or any other similar statute or legislation that obligates the Parent or any of its Subsidiaries to make a cash payment as designated by such statute or legislation in respect of its asbestos exposure."

" 'Specified Legislation Enactment Date' means the first date upon which both of the following shall have occurred: (a) the Specified Legislation is passed by the requisite vote of the United States Senate and United States House of Representatives and (b) either (i) the President of the United States signs the Specified Legislation or (ii) if the President of the United States vetoes such Specified Legislation, the date on which the requisite vote of the United States Senate and United States House of Representatives overrides such Presidential veto."

	Changes to Definitions.  

	The definition of the term "Applicable Prepayment Premium" in Section 1.01 of the Financing Agreement is hereby amended and restated in its entirety to read as follows:

" 'Applicable Prepayment Premium' means, as of any date of determination, (i) with respect to Revolving Loans, an amount equal to zero, (ii) with respect to the Term Loan A, an amount equal to (a) during the period of time from and after the First Amendment Effective Date up to the date that is the first anniversary of the First Amendment Effective Date, 1.0% times the portion of the Term Loan A that is prepaid, and (b) at all times thereafter, zero, and (iii) with respect to the Term Loan B, an amount equal to (a) during the period of time from and after the First Amendment Effective Date up to the date that is the first anniversary of the First Amendment Effective Date, 3.0% times the portion of the Term Loan B that is prepaid, (b) during the period of time from and after the date that is the first anniversary of the First Amendment Effective Date up to the date that is the second anniversary of the First Amendment Effective Date, 2.0% times the portion of the Term Loan B that is prepaid, (c) during the period of time from and after the date that is the second anniversary of the First Amendment Effective Date up to the date that is the third anniversary of the Effective Date, 1.0% times the portion of the Term Loan B that is prepaid, and (d) at all times thereafter, zero."

	Paragraph (a) in the proviso of the definition of the term "Capital Expenditures" in Section 1.01 of the Financing Agreement is hereby amended by deleting clause (ii) in its entirety and substituting the following in lieu thereof: 

"(ii) to the extent made with Disposition Reinvestment Proceeds, or" 

	The definition of the term Consolidated EBITDA in Section 1.01 of the Financing Agreement is hereby amended by inserting the following new sentence at the end thereof:

"For the avoidance of doubt, any Specified Legislation Payment shall be deemed an expense for purposes of the income statement in the calculation of net income (loss) of such Person and its Subsidiaries."

	Paragraph (n) of the definition of the term "Permitted Acquisition" in Section 1.01 of the Financing Agreement is hereby amended by deleting "$15,000,000" therein and substituting "$25,000,000" in lieu thereof. 
	The definition of the term "Permitted Dispositions" in Section 1.01 of the Financing Agreement is hereby amended and restated in its entirety to read as follows:

" 'Permitted Dispositions' has the meaning set forth in Section 8.02(c)(i)(C)." 

	The definition of the term "Permitted Indebtedness" in Section 1.01 of the Financing Agreement is hereby amended by (i) deleting "$15,000,000" in paragraph (c) thereof and substituting "$25,000,000" in lieu thereof, (ii) deleting the word "and" at the end of paragraph (m) thereof, (iii) deleting the period at the end of paragraph (n) thereof and substituting "; and" in lieu thereof, and (iv) inserting the following new paragraph (o):

"(o)Permitted Vessel Financing Indebtedness."

	The definition of the term "Permitted Liens" in Section 1.01 of the Financing Agreement is hereby amended by (i) deleting "$5,000,000" in paragraph (e) thereof and substituting "$15,000,000" in lieu thereof, and (ii) deleting paragraph (l) thereof in its entirety and substituting the following in lieu thereof:

"(l)Liens securing Permitted Vessel Financing Indebtedness;"

	The definition of the term "Post-Default Rate" in Section 1.01 of the Financing Agreement is hereby amended by deleting "the greater of (i) the Reference Rate plus 11.75% and (ii) 16.25%" therein and substituting "the greater of (i) the Reference Rate plus 8.50% and (ii) 13.00%" in lieu thereof.

	Other Amendments.  

	Section 2.03(b) of the Financing Agreement is hereby amended and restated in its entirety to read as follows:

"(b)The outstanding principal of the Term Loan A shall be repayable in consecutive quarterly installments, on the last day of each calendar quarter, commencing on December 31, 2005 and ending on the Maturity Date, each in an amount equal to $262,500; provided, however, that the last such installment shall be in the amount necessary to repay in full the unpaid principal amount of the Term Loan A." 

	Section 2.04(a) of the Financing Agreement is hereby amended and restated in its entirety to read as follows: 

"(a)Revolving Loans.  Subject to the terms of this Agreement, at the option of the Administrative Borrower, each Revolving Loan shall be either a Reference Rate Loan or a LIBOR Rate Loan.  Each Revolving Loan that is a (i) Reference Rate Loan shall bear interest on the principal amount thereof from time to time outstanding at a rate per annum equal to the greater of (A) the Reference Rate and (B) 4.50% and (ii) LIBOR Rate Loan shall bear interest on the principal amount thereof from time to time outstanding, from the date of such Loan until such principal amount becomes due, at a rate per annum equal to the greater of (A) the LIBOR Rate for the Interest Period in effect for such Revolving Loan plus 2.50% and (B) 4.50%."

	Section 2.04(b) of the Financing Agreement is hereby amended and restated in its entirety to read as follows:

"(b)Term Loan A.  Subject to the terms of this Agreement, at the option of the Administrative Borrower, the Term Loan A shall be either a Reference Rate Loan or a LIBOR Rate Loan.  The Term Loan A shall bear interest on the principal amount thereof from time to time outstanding at a rate per annum equal to (A) in the case of a Reference Rate Loan, the greater of (x) the Reference Rate plus .50% and (y) 5.00% and (B) in the case of a LIBOR Rate Loan, the greater of (x) the LIBOR Rate for the Interest Period in effect for the Term Loan A plus 3.00% and (y) 5.00%."

	Section 2.04(c) of the Financing Agreement is hereby amended and restated in its entirety to read as follows:

"(c)Term Loan B.  Subject to the terms of this Agreement, at the option of the Administrative Borrower, the Term Loan B shall be either a Reference Rate Loan or a LIBOR Rate Loan.  The Term Loan B shall bear interest on the principal amount thereof from time to time outstanding at a rate per annum equal to (A) in the case of a Reference Rate Loan, the greater of (x) the Reference Rate plus 6.50% and (y) 11.00% and (B) in the case of a LIBOR Rate Loan, the greater of (x) the LIBOR Rate for the Interest Period in effect for the Term Loan B plus 7.00% and (y) 9.00%."

	Section 2.04(d) of the Financing Agreement is hereby amended by (i) deleting the heading "Default Interest." therein and substituting the heading "Default Interest; Specified Legislation Interest." in lieu thereof, (ii) designating the existing language set forth therein as clause (i), and (iii) inserting the following new clause (ii):

"(ii)Upon the occurrence of a Fixed Charge Coverage Ratio Condition, and at the request of the Required Term A Lenders with respect to the Term Loan A and at the request of the Required Term B Lenders with respect to the Term Loan B, the principal of, and all accrued interest and unpaid interest on, the applicable Loans, shall bear interest, (a) in the case of a Fixed Charge Coverage Ratio Condition by reason of clause (a) of the definition of such term, from the date of the Specified Legislation Payment, or (b) in the case of a Fixed Charge Coverage Ratio Condition by reason of clause (b) of the definition of such term, on a retroactive basis from the Specified Legislation Enactment Date (the applicable date in clause (a) or (b), the "Specified Legislation Interest Triggering Date") until the date that the Fixed Charge Coverage Ratio Condition no longer exists, at a rate per annum equal at all times to the rate of interest otherwise applicable thereto (whether or not such Obligations bear interest at the Post-Default Rate applicable thereto) plus (x) .50% in the case of the Term Loan A and (y) 2.0% in the case of the Term Loan B."  

	Section 2.05(a)(i)(A) of the Financing Agreement is hereby amended and restated in its entirety to read as follows:

"(i)(A)The Total Revolving Credit Commitment and the Revolving Credit Commitment of each Lender shall terminate on the Maturity Date.  The Borrowers may reduce, without premium or penalty, the Total Revolving Credit Commitment to an amount (which may be zero) not less than the sum of (1) the aggregate unpaid principal amount of all Revolving Loans then outstanding, (2) the aggregate principal amount of all Revolving Loans not yet made as to which a Notice of Borrowing has been given by the Administrative Borrower under Section 2.02, (3) the Letter of Credit Obligations at such time, (4) the stated amount of all Letter of Credit Accommodations not yet issued as to which a request has been made and not withdrawn, and (5) any reserves established pursuant to clause (ii) of the definition of "Availability" and pursuant to the definition of "Borrowing Base"."

	Section 2.05(b)(i) of the Financing Agreement is hereby amended by deleting the last sentence thereof. 
	Section 2.05(c)(vi)(A) of the Financing Agreement is hereby amended and restated in its entirety to read as follows:

"(A) the issuance or incurrence by any Loan Party or any of its Subsidiaries of any Indebtedness (including, without limitation, Permitted Vessel Financing Indebtedness but excluding other Permitted Indebtedness), the Borrowers shall prepay the outstanding amount of the Loans in an amount equal to 100% of the Net Cash Proceeds received by such Person in connection therewith and".

	Section 2.05(c)(vii) of the Financing Agreement is hereby amended by deleting the reference to "clause (viii)" in the first line therein and substituting "clause (ix)" in lieu thereof.  
	Section 2.05(c)(viii) of the Financing Agreement is hereby amended and restated in its entirety to read as follows:

"(viii)Notwithstanding the foregoing, with respect to Net Cash Proceeds that the Borrowers are required to prepay in connection with a Disposition under Section 2.05(c)(v), a percentage of such Net Cash Proceeds as set forth in the following table shall not be required to be applied to the prepayment of the Loans to the extent such proceeds are reinvested in or otherwise used to replace, repair or restore properties or assets used in such Loan Party's business in accordance with the terms of this Section 2.05(c)(viii) set forth below (such applicable portion of the Net Cash Proceeds not required to prepay the Loans on such date, the "Disposition Reinvestment Proceeds"):

	

75% of the Net Cash Proceeds received by such Person in connection with such Disposition to the extent the aggregate amount of Net Cash Proceeds (in excess of the $500,000 annual basket specified in Section 2.05(c)(v)) received by the Loan Parties and their Subsidiaries do not exceed $25,000,000 for all Dispositions since the First Amendment Effective Date;

	

50% of the Net Cash Proceeds received by such Person in connection with such Disposition to the extent the aggregate amount of Net Cash Proceeds (in excess of the $500,000 annual basket specified in Section 2.05(c)(v)) received by the Loan Parties and their Subsidiaries exceed $25,000,000, but do not exceed $50,000,000 for all Dispositions since the First Amendment Effective Date;

	

25% of the Net Cash Proceeds received by such Person in connection with such Disposition to the extent the aggregate amount of Net Cash Proceeds (in excess of the $500,000 annual basket specified in Section 2.05(c)(v)) received by the Loan Parties and their Subsidiaries exceed $50,000,000, but do not exceed $100,000,000 for all Dispositions since the First Amendment Effective Date;

	

0% of the Net Cash Proceeds received by such Person in connection with such Disposition to the extent the aggregate amount of Net Cash Proceeds (in excess of the $500,000 annual basket specified in Section 2.05(c)(v)) received by the Loan Parties and their Subsidiaries for all Dispositions since the First Amendment Effective Date exceed $100,000,000;

provided that, notwithstanding the foregoing, if (A) the Leverage Ratio of the Parent and its Subsidiaries as of the end of the mostly recently completed period of four (4) consecutive fiscal quarters ended immediately prior to such Disposition for which there are available financial statements, such ratio calculated on a pro forma basis giving effect to any such Disposition and the application of the Net Cash Proceeds from such Disposition as required above in Section 2.05(c)(v) and this clause (viii) (it being agreed that, in the case of an asset sale, the Parent and the Agents shall mutually agree on the portion of Parent's Consolidated EBITDA attributable to the assets subject to such Disposition) (such ratio in this clause (A), the "Post-Disposition Leverage Ratio") would be greater than (B) the Leverage Ratio of the Parent and its Subsidiaries as of the end of the most recently completed period of four (4) consecutive fiscal quarters ended immediately prior to such Disposition for which there are available financial statements (as demonstrated in the certificate delivered pursuant to Section 8.01(a)(iv) with respect to the fiscal quarter immediately preceding such date) (such ratio in this clause (B), the "Pre-Disposition Leverage Ratio"), then the Borrowers shall prepay the Loans in accordance with Section 2.05(c)(v) in an amount that will result in the Post-Disposition Leverage Ratio being equal to or less than the Pre-Disposition Leverage Ratio;

provided further that, (w) such Disposition Reinvestment Proceeds shall be used by a Loan Party to reinvest in, or otherwise replace, repair or restore, properties or assets constituting (A) Revolver Priority Collateral if the property or assets disposed constituted Revolver Priority Collateral, (B) Term Priority Collateral if the property or assets disposed constituted Term Priority Collateral, and (C) property, plant or equipment if the receipt of Net Cash Proceeds did not arise from a disposition of any property or assets, (x) no Default or Event of Default has occurred and is continuing on the date such Person receives such Net Cash Proceeds, (y) the Administrative Borrower delivers a certificate to the Agents within 5 days after such Disposition stating that such Disposition Reinvestment Proceeds shall be used to reinvest in, or otherwise replace, repair or restore any such properties or assets to be used in such Loan Party's or any of its Subsidiaries' business within a period specified in such certificate not to exceed 270 days after the receipt of such proceeds (which certificate shall set forth estimates of the proceeds to be so expended), and (z) such Disposition Reinvestment Proceeds are deposited in an account subject to the sole dominion and control of the Administrative Agent; and if all or any portion of such proceeds not so applied to the prepayment of the Loans are not used in accordance with the preceding sentence within the period specified in the relevant certificate furnished pursuant hereto or there shall occur a Default or Event of Default, such remaining portion shall be applied to the Loans as required by Section 2.05(c)(v), on the last day of such specified period or immediately, in the case of a Default or Event of Default.  If the Borrowers are not permitted to reinvest or utilize such Net Cash Proceeds in accordance with this clause (viii) as a result of the existence of a Default, at the election of the Administrative Borrower, such Net Cash Proceeds shall be deposited in an account subject to the sole dominion and control of the Administrative Agent until the earlier of (I) the date on which such Default is cured or waived in writing in accordance with the terms of this Agreement, in which case such amounts may be reinvested or utilized in accordance with this clause (viii) and (II) the date on which an Event of Default shall occur, in which case such Net Cash Proceeds shall be applied to the Loans in accordance with Section 5.04(b) on such date."

	Section 2.05(c) of the Financing Agreement is hereby amended by adding the following new clause (ix) at the end thereof:

"(ix)Notwithstanding the foregoing, with respect to Extraordinary Receipts, net of any reasonable expenses incurred in collecting such Extraordinary Receipts, that the Borrowers are required to prepay in connection with the receipt of Extraordinary Receipts pursuant to Section 2.05(c)(vii), up to (a) $5,000,000 in the aggregate of such Extraordinary Receipts of the type identified in clause (ii) of the definition thereof, and (b) $1,000,000 in the aggregate of all other Extraordinary Receipts, in each case received by any Loan Party or any of its Subsidiaries shall not be required to be applied to the prepayment of the Loans on such date to the extent such proceeds are reinvested in or otherwise used to replace, repair or restore the properties or assets used in such Loan Party's business, provided that, (w) such proceeds shall be used by a Loan Party to reinvest in, or otherwise replace, repair or restore, properties or assets constituting (A) Revolver Priority Collateral if the property or assets subject to casualty or condemnation constituted Revolver Priority Collateral, (B) Term Priority Collateral if the property or assets subject to casualty or condemnation constituted Term Priority Collateral, and (C) property, plant or equipment if the receipt of Extraordinary Receipts did not arise from a casualty or condemnation of any property or assets, (x) no Default or Event of Default has occurred and is continuing on the date such Person receives such Extraordinary Receipts, (y) the Administrative Borrower delivers a certificate to the Agents within 10 days after the date of such loss, destruction or taking, as the case may be, stating that such proceeds shall be used to reinvest in, or otherwise replace, repair or restore any such properties or assets to be used in such Loan Party's or any of its Subsidiaries' business within a period specified in such certificate not to exceed 180 days after the receipt of such proceeds (which certificate shall set forth estimates of the proceeds to be so expended), and (z) such proceeds are deposited in an account subject to the sole dominion and control of the Administrative Agent; and if all or any portion of such proceeds not so applied to the prepayment of the Loans are not used in accordance with the preceding sentence within the period specified in the relevant certificate furnished pursuant hereto or there shall occur a Default or Event of Default, such remaining portion shall be applied to the Loans as required by Section 2.05(c)(vii) on the last day of such specified period or immediately, in the case of a Default or Event of Default.  If the Borrowers are not permitted to reinvest or utilize such Extraordinary Receipts in accordance with this clause (ix) as a result of the existence of a Default, at the election of the Administrative Borrower, such Extraordinary Receipts shall be deposited in an account subject to the sole dominion and control of the Administrative Agent until the earlier of (I) the date on which such Default is cured or waived in writing in accordance with the terms of this Agreement, in which case such amounts may be reinvested or utilized in accordance with this clause (ix) and (II) the date on which an Event of Default shall occur, in which case such Extraordinary Receipts shall be applied to the Loans in accordance with Section 5.04(b) on such date."

	Section 2.05(d)(iv) of the Financing Agreement is hereby amended by deleting the proviso at the end of the first sentence thereof and substituting the following proviso in lieu thereof:

"provided that, notwithstanding the foregoing, (I) in the case of a Warrant Issuance, up to $5,775,000 of the Net Cash Proceeds received by the Parent or any of its Subsidiaries, may be applied solely to the Revolving Loans until paid in full and (II) in the case of an incurrence of Permitted Vessel Financing Indebtedness, the Net Cash Proceeds received by the Parent or any of its Subsidiaries shall not be required to be applied to the prepayment of the Revolving Loans."

	Section 2.05(e) of the Financing Agreement is hereby amended by:

	deleting clause (iii) thereof in its entirety and substituting the following in lieu thereof:

"(iii) in the case of any prepayment made pursuant to Sections 2.05(b)(ii), 2.05(b)(iii), 2.05(c)(iii), 2.05(c)(v) (other than with respect prepayments made solely from Permitted Dispositions) or 2.05(c)(vi) (other than with respect to prepayments of the Term Loans made solely from the incurrence of Permitted Vessel Financing Indebtedness), the Applicable Prepayment Premium, if any.", and  

	deleting the penultimate sentence thereof.
	Section 3.03(b)(i) of the Financing Agreement is hereby amended deleting "3.50%" in each place that it appears and substituting "2.50%" in lieu thereof.  
	Section 8.02(c) of the Financing Agreement is hereby amended by 

	deleting subclause (C) in clause (i) thereof and substituting the following in lieu thereof:

"(C) sell or otherwise dispose of other property or assets in an aggregate amount not less than the fair market value of such property or assets (in each case, for consideration comprised of at least 75% cash), provided that, if the fair market value of such property or assets so sold or otherwise so disposed of in one transaction or a series of related transactions exceeds $10,000,000, such sale or other disposition shall only be permitted if the Agents shall have received a fairness opinion, in form and substance reasonably satisfactory to the Agents and their respective counsel from a third party appraiser reasonably satisfactory to the Agents (such sales or dispositions permitted pursuant to this subclause (C), each a "Permitted Disposition" and collectively, the "Permitted Disposition")," 

	deleting subclause (x) in the proviso of clause (i) thereof and substituting the following in lieu thereof:

"(x) in the case of clause (C) above, does not exceed $100,000,000 in the aggregate since the First Amendment Effective Date," 

	deleting clause (iv) in its entirety and substituting the following in lieu thereof:

"(iv)[Intentionally Omitted]; and"

	Section 8.02(g) of the Financing Agreement is hereby amended by deleting the word "Month" in the table set forth therein and substituting the words "Fiscal Year" in lieu thereof. 
	Clause (z) of Section 8.02(h) of the Financing Agreement is hereby amended and restated in its entirety to read as follows:

"(z)the Parent may repurchase the Preferred Stock in an amount equal to the sum of (1) the unused portion of the Preferred Stock Buyback Amount and (2) the unused portion of the Excluded Equity Proceeds, provided that (A) immediately before and immediately after giving effect to such payment, no Default or Event of Default shall exist, (B) immediately before and immediately after giving effect to such payment, Borrowers shall have Excess Availability of at least $20,000,000, and (C) the Borrowers have first made all prepayments of the Loans required under Section 2.05(c)(vi)(B)."

	Section 8.03(c) of the Financing Agreement is hereby amended and restated in its entirety to read as follows:

"Minimum Fixed Charge Coverage Ratio.  Permit the Fixed Charge Coverage Ratio of the Parent and its Subsidiaries for each period of four (4) consecutive fiscal quarters of the Parent and its Subsidiaries for which the last quarter ends on a date set forth below to be less than the ratio set forth opposite such date: 

	

Fiscal Quarter End
	

Ratio

	June 30, 2005

	1.60 to 1.00

	September 30, 2005

	1.55 to 1.00

	December 31, 2005

	1.45 to 1.00

	March 31, 2006

	1.50 to 1.00

	June 30, 2006

	1.55 to 1.00

	September 30, 2006

	1.60 to 1.00

	December 31, 2006

	1.65 to 1.00

	March 31, 2007

	1.70 to 1.00

	June 30, 2007

	1.75 to 1.00

	September 30, 2007

	1.45 to 1.00

	December 31, 2007

	1.50 to 1.00

	March 31, 2008

	1.55 to 1.00

	June 30, 2008

	1.50 to 1.00

	September 30, 2008, and each fiscal quarter thereafter

	1.90 to 1.00"

	Section 8.03 of the Financing Agreement is hereby amended by adding the following new paragraph (d) at the end thereof: 

"(d)Leverage Ratio.  Permit the Leverage Ratio of the Parent and its Subsidiaries as of the end of each period of four (4) consecutive fiscal quarters for which the last quarter ends on a date set forth below to be greater than the applicable ratio opposite such date:

	

Fiscal Quarter End
	

Ratio

	June 30, 2005

	5.75 to 1.00

	September 30, 2005

	5.75 to 1.00

	December 31, 2005

	5.50 to 1.00

	March 31, 2006

	5.50 to 1.00

	June 30, 2006

	5.75 to 1.00

	September 30, 2006

	5.50 to 1.00

	December 31, 2006

	5.25 to 1.00

	March 31, 2007

	5.35 to 1.00

	June 30, 2007

	5.40 to 1.00

	September 30, 2007

	4.85 to 1.00

	December 31, 2007

	4.60 to 1.00

	March 31, 2008 

	4.90 to 1.00

	June 30, 2008

	4.90 to 1.00

	September 30, 2008

	4.50 to 1.00

	December 31, 2008, and each fiscal quarter thereafter

	4.50 to 1.00"

	Schedules.  

	Schedule 8.02(c) to the Financing Agreement is hereby deleted in its entirety.  Any references to Schedule 8.02(c) in the Financing Agreement are hereby deleted in their entirety. 
	Schedule 7.01(i) of the Financing Agreement is hereby amended and restated in its entirety to read as set forth on Annex I attached hereto.  

	Representations and Warranties.  Each Loan Party hereby jointly and severally represent and warrant to the Agents and the Lenders as follows:

	Each Loan Party (i) is a corporation, limited liability company or limited partnership duly organized, validly existing and in good standing under the laws of the state of its organization and (ii) has all requisite power and authority to execute, deliver and perform this Amendment and to perform the Financing Agreement, as amended hereby.
	The execution, delivery and performance by each Loan Party of this Amendment and the performance by each Loan Party of the Financing Agreement, as amended hereby (i) have been duly authorized by all necessary corporate, limited liability company or limited partnership action, (ii) do not and will not contravene its charter or by-laws, its limited liability company or operating agreement or its certificate of partnership or partnership agreement, as applicable, any applicable law or any contractual restriction binding on or otherwise affecting such Loan Party or any of such Loan Party's properties, or any order or decree of any court or Governmental Authority and (iii) do not and will not result in or require the creation of any Lien upon or with respect to such Loan Party's material properties.
	No authorization or approval or other action by, and no notice to or filing with, any Governmental Authority is required in connection with the due execution, delivery and performance by any Loan Party of this Amendment or the performance by any Loan Party of the Financing Agreement, as amended hereby.
	This Amendment and the Financing Agreement, as amended hereby, constitute the legal, valid and binding obligations of each Loan Party, enforceable against such Loan Party in accordance with their terms.
	The representations and warranties contained in Article VII of the Financing Agreement are correct on and as of the date hereof as though made on and as of the date hereof (except to the extent such representations and warranties expressly relate to an earlier date in which case such representations and warranties shall be true and correct as of such earlier date), and no Default or Event of Default has occurred and is continuing on and as of the date hereof.

	Conditions to Effectiveness.  This Amendment shall become effective (the "Amendment Effective Date") upon satisfaction in full of the following conditions precedent:

	The Collateral Agent shall have received counterparts of this Amendment that bear the signatures of each Borrower, each Guarantor, each Agent and each Lender.
	The representations and warranties contained in this Amendment and in Article VII of the Financing Agreement and each other Loan Document shall be correct on and as of the Amendment Effective Date as though made on and as of such date (except to the extent such representations and warranties expressly relate to an earlier date in which case such representations and warranties shall be true and correct as of such earlier date).
	No Default or Event of Default shall have occurred and be continuing on the Amendment Effective Date or result from the Amendment becoming effective in accordance with its terms.
	All legal matters incident to this Amendment shall be satisfactory to the Agents and their respective counsel.

	Continued Effectiveness of the Financing Agreement and Other Loan Documents.  

	Each Loan Party hereby (i) acknowledges and consents to this Amendment, (ii) confirms and agrees that the Financing Agreement and each other Loan Document to which it is a party is, and shall continue to be, in full force and effect and is hereby ratified and confirmed in all respects except that on and after the Effective Date all references in any such Loan Document to "the Financing Agreement", the "Agreement", "thereto", "thereof", "thereunder" or words of like import referring to the Financing Agreement shall mean the Financing Agreement as amended by this Amendment, and (iii) confirms and agrees that to the extent that any such Loan Document purports to assign or pledge to the Collateral Agent for the benefit of the Agents and the Lenders, or to grant to the Collateral Agent for the benefit of the Agents and the Lenders a security interest in or Lien on, any Collateral as security for the Obligations or Guaranteed Obligations, as the case may be, of any Loan Party from time to time existing in respect of the Financing Agreement and the other Loan Documents, such pledge, assignment and/or grant of the security interest or Lien is hereby ratified and confirmed in all respects.  This Agreement does not and shall not affect any of the obligations of any Loan Party, other than as expressly provided herein, including, without limitation, the Borrowers' obligation to repay the Loans in accordance with the terms of Financing Agreement, or the obligations of any other Loan Party under any Loan Document to which it is a party, all of which obligations shall remain in full force and effect.  Except as expressly provided herein, the execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of the Agents or any Lender under the Financing Agreement or any other Loan Document, nor constitute a waiver of any provision of the Financing Agreement or any other Loan Document.
	This Amendment shall constitute a Loan Document for all purposes of the Financing Agreement and the other Loan Documents.

	Miscellaneous.

	This Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which shall be deemed to be an original but all of which taken together shall constitute one and the same agreement.  Delivery of an executed counterpart of this Amendment by facsimile or electronic mail shall be equally effective as delivery of an original executed counterpart of this Amendment.  
	Section and paragraph headings herein are included for convenience of reference only and shall not constitute a part of this Amendment for any other purpose.
	THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED IN THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES. 
	Any provision of this Amendment that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining portions hereof or affecting the validity or enforceability of such provision in any other jurisdiction.
	Borrowers will pay on demand all reasonable fees, costs and expenses of the Agents in connection with the preparation, execution and delivery of this Amendment or otherwise payable under the Financing Agreement, including, without limitation, reasonable fees, disbursements and other charges of counsel to the Agents. 

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed and delivered as of the date set forth on the first page hereof.
BORROWERS: 

ERIE NAVIGATION COMPANY

ERIE SAND AND GRAVEL COMPANY

ERIE SAND STEAMSHIP CO.

O-N MINERALS (CHEMSTONE) COMPANY (formerly known as Global Stone Chemstone Corporation)

O-N MINERALS (ERIE) COMPANY (formerly known as Mountfort Terminal, Ltd.)

O-N MINERALS (FILLER PRODUCTS) COMPANY (formerly known as Global Stone Filler Products, Inc.)

O-N MINERALS (JAMES RIVER) COMPANY (formerly known as Global Stone James River, Inc.)

O-N MINERALS (LUTTRELL) COMPANY (formerly known as Global Stone Tenn Luttrell Company)

O-N MINERALS (MICHIGAN) COMPANY (formerly known as Michigan Limestone Operations, Inc.)

O-N MINERALS (PORTAGE) COMPANY LLC (formerly known as Global Stone Portage, LLC)

O-N MINERALS (ST. CLAIR) COMPANY (formerly known as Global Stone St. Clair Inc.)

O-N MINERALS (TERMINALS) COMPANY (formerly known as Oglebay Norton Terminals, Inc.)
OGLEBAY NORTON COMPANY

OGLEBAY NORTON INDUSTRIAL SANDS, INC.

OGLEBAY NORTON MARINE SERVICES

COMPANY, L.L.C.

OGLEBAY NORTON SPECIALTY MINERALS, INC.

By:  /s/ J. A. Boland

   Name: J. A. Boland

   Title:  VP and Treasurer

O-N MINERALS (PENROC) COMPANY LP (formerly known as Global Stone PenRoc, LP)

By:O-N Minerals (GSPC) Company,

its general partner
          By:  /s/ J. A. Boland

              Name: J. A. Boland

              Title:  VP and Treasurer

 

TEXAS MINING, LP

By:ONTEX, Inc.

its general partner
         By:  /s/ J. A. Boland

             Name: J. A. Boland

             Title:  VP and Treasurer

GUARANTORS: 

O-N MINERALS COMPANY (formerly known as Global Stone Corporation)

O-N MINERALS (GEORGIA) COMPANY (formerly known as Global Stone Management Company)

O-N MINERALS (GSPC) COMPANY (formerly known as GS PC Inc.)

O-N MINERALS (LIME) COMPANY (formerly known as GS Lime Company)
OGLEBAY NORTON ENGINEERED MATERIALS, INC.

OGLEBAY NORTON MANAGEMENT COMPANY

OGLEBAY NORTON MARINE MANAGEMENT COMPANY, L.L.C.
OGLEBAY NORTON MINERALS, INC.

ON COAST PETROLEUM COMPANY

ON MARINE SERVICES COMPANY

ONCO INVESTMENT COMPANY

ONCO WVA, INC.

ONMS MANAGEMENT COMPANY, LLC

ONTEX, INC.

SAGINAW MINING COMPANY

By:  /s/ J. A. Boland

   Name: J. A. Boland

   Title:  VP and Treasurer

 

 
COLLATERAL AGENT:

SILVER POINT FINANCE, LLC

By: /s/ Jeffery A. Gelfand
Name: Jeffery A. Gelfand

Title:   Authorized Signatory

 

 
ADMINISTRATIVE AGENT AND LENDER:

WELLS FARGO FOOTHILL, INC.

By:/s/ David Sanchez
Name: David Sanchez

Title:   V.P.

LENDER:

BANK OF AMERICA, N.A.

By:/s/ Jang S. Kim

Name: Jang S. Kim

Title:   V.P.

 

LENDER:

BDC FINANCE, L.L.C.

By:/s/ James J. Zenni, Jr.

Name: James J. Zenni, Jr.

Title:   Director

LENDER:

BEAR STEARNS INVESTMENT PRODUCTS, INC.

By:/s/ Jonathan Weiss

Name: Jonathan Weiss

Title:   Authorized Signatory

LENDER:

BLACK DIAMOND INTERNATIONAL 

FUNDING, LTD

By:/s/ Alan Corkish

Name: Alan Corkish

Title:   Director

LENDER:

COOKSMILL

By:/s/ John R. H. Campbell

Name: John R. H. Campbell

Title:   Authorized Signatory

LENDER:

FIELD POINT I, LTD.

By: /s/ Jeffery A. Gelfand
Name: Jeffery A. Gelfand

Title:   Authorized Signatory

 

 
LENDER:

FIELD POINT II, LTD.

By: /s/ Jeffery A. Gelfand
Name: Jeffery A. Gelfand

Title:   Authorized Signatory

 
LENDER:

GOLDMAN SACHS CREDIT PARTNERS L.P.

By: /s/ Pedro Ramirez
Name: Pedro Ramirez

Title:   Authorized Signatory

 
LENDER:

JP MORGAN CHASE BANK, N.A.

By: /s/ John P. Freeman
Name: John P. Freeman

Title:   Director

 
LENDER:

LIMESTONE INVESTORS, L.L.C.

By: Farallon Capital Management, L.L.C               its General Manager

By: /s/ Rajiv Patel

Name: Rajiv Patel

Title:   Managing Member

 

 
LENDER:

MORGAN STANLEY FUNDING, INC.

By: /s/ Daniel Allen
Name: Daniel Allen

Title:   Vice President

 
LENDER:

OAK HILL CREDIT ALPHA FUND (OFFSHORE), LTD.

By: /s/ Scott D. Krase
Name: Scott D. Krase

Title:  Authorized Signatory

 
LENDER:

OAK HILL CREDIT ALPHA FUND, LP

By: Oak Hill Credit Alpha GenPar, L.P.,                its General Partner

By: Oak Hill Credit Alpha MGP, LLC,                   its General Partner

By: /s/ Scott D. Krase
Name: Scott D. Krase

Title:   Authorized Signatory

 
LENDER:

OAK HILL SECURITIES FUND, L.P.

By: Oak Hill Credit Alpha GenPar, L.P.,                its General Partner

By: Oak Hill Credit Alpha MGP, LLC,                   its General Partner

By: /s/ Scott D. Krase
Name: Scott D. Krase

Title:   Authorized Signatory

 
LENDER:

OAK HILL SECURITIES FUND II, L.P.

By: Oak Hill Credit Alpha GenPar, L.P.,                its General Partner

By: Oak Hill Credit Alpha MGP, LLC,                   its General Partner

By: /s/ Scott D. Krase
Name: Scott D. Krase

Title:   Authorized Signatory

 
LENDER:

QP SFM CAPITAL HOLDINGS LIMITED

By: /s/ Richard D. Holahan, Jr.
Name: Richard D. Holahan, Jr.

Title:  Attorney-in-Fact

 
LENDER:

ROYAL BANK OF CANADA

By: /s/ Stephen R. Levitan
Name: Stephen R. Levitan

Title:  Authorized Signatory

 
LENDER:

SHEPERD INVESTMENTS INTERNATIONAL, LTD.

By: /s/ Michael A. Roth 
Name: Michael A. Roth

Title:  Managing Member of Stark Offshore Management, LLC, Investment Manager

 
LENDER:

SPF CDO I

By: /s/ Jeffery A. Gelfand
Name: Jeffery A. Gelfand

Title:  Authorized Signatory

 
LENDER:

SPIRET IV LOAN TRUST 2003-A
By: WILMINGTON TRUST COMPANY, not in its individual  capacity but solely as trustee       

By: /s/ Mary Kay Pupillo

Name: Mary Kay Pupillo

Title:   Assistant Vice President

 
LENDER:

STARK TRADING

By: /s/ Michael A. Roth 
Name: Michael A. Roth

Title:  Managing Member of Stark Offshore Management, LLC, Investment Manager

 
LENDER:

TRS THEBE LLC

By: /s/ Alice L. Wagner 
Name: Alice L. Wagner

Title:  Vice President

ANNEX I

Schedule 7.01(i)

ERISA

Welfare Benefits for Retired or Former Employees

1.  Employee Benefit Plan for Oglebay Norton Company and Certain Associated Companies.

2.  Oglebay Norton Company Welfare Benefits Plan.

3.  Oglebay Norton Severance Guidelines.

4.  Change in Control Severance Plan. 

5.  Michigan Limestone Operations Limited Partnership Supplement Unemployment Benefit Plan.

6.  Oglebay Norton Company Management Incentive Plan.

7.  Employment Agreements between Global Stone Corporation and William Vest, Conrad Eiben, Joe Ferrell, Mark Yeary, and R. Harbold.

8.  Change in Control and Employment Agreements between Oglebay Norton Company and Michael D. Lundin, Julie A. Boland, Sylvie A. Bon, Michael J. Minkel, and Rochelle F. Walk.

9.  Any and All Severance Agreements or Similar Arrangements with Employees  

	Agreements with John Lauer, Stewart Theis, Richard Kessler and Mrs. Jean Benson (surviving spouse of Keith Benson) for supplemental retirement benefits in addition to the Defined Benefit plan & SERP.

10.  Irrevocable Trust II.

11.  Oglebay Norton Company Assurance Trust.

12.  Oglebay Norton Flexible Benefits Plan<PAGE>

                                                                     EXHIBIT 4.1

                   ABLE ENERGY, INC. 2005 INCENTIVE STOCK PLAN

================================================================================

        THIS ABLE ENERGY, INC. 2005 INCENTIVE STOCK PLAN (the "PLAN") is
designed to retain directors, executives and selected employees and consultants
and reward them for making major contributions to the success of the Company.
These objectives are accomplished by making long-term incentive awards under the
Plan thereby providing Participants with a proprietary interest in the growth
and performance of the Company.

1.      Definitions.

        (a)     "BOARD" - The Board of Directors of the Company.

        (b)     "CODE" - The Internal Revenue Code of 1986, as amended from time
                to time.

        (c)     "COMMITTEE" - The Compensation Committee of the Company's Board,
                or such other committee of the Board that is designated by the
                Board to administer the Plan, composed of not less than two
                members of the Board all of whom are disinterested persons, as
                contemplated by Rule 16b-3 ("RULE 16B-3") promulgated under the
                Securities Exchange Act of 1934, as amended (the "EXCHANGE
                ACT").

        (d)     "COMPANY" - Able Energy, Inc. and its subsidiaries including
                subsidiaries of subsidiaries.

        (e)     "EXCHANGE ACT" - The Securities Exchange Act of 1934, as amended
                from time to time.

        (f)     "FAIR MARKET VALUE" - The fair market value of the Company's
                issued and outstanding Stock as determined in good faith by the
                Board or Committee.

        (g)     "DELAWARE SECURITIES RULES" - Delaware General Corporation Law.

        (h)     "GRANT" - The grant of any form of stock option, stock award, or
                stock purchase offer, whether granted singly, in combination or
                in tandem, to a Participant pursuant to such terms, conditions
                and limitations as the Committee may establish in order to
                fulfill the objectives of the Plan.

        (i)     "GRANT AGREEMENT" - An agreement between the Company and a
                Participant that sets forth the terms, conditions and
                limitations applicable to a Grant.

        (j)     "OPTION" - Either an Incentive Stock Option, in accordance with
                Section 422 of Code, or a Nonstatutory Option, to purchase the
                Company's Stock that may be awarded to a Participant under the
                Plan. A Participant who receives an award of an Option shall be
                referred to as an "OPTIONEE."

<PAGE>

        (k)     "PARTICIPANT" - A director, officer, employee or consultant of
                the Company to whom an Award has been made under the Plan.

        (l)     "RESTRICTED STOCK PURCHASE OFFER" - A Grant of the right to
                purchase a specified number of shares of Stock pursuant to a
                written agreement issued under the Plan.

        (m)     "SECURITIES ACT" - The Securities Act of 1933, as amended from
                time to time.

        (n)     "STOCK" - Authorized and issued or unissued shares of common
                stock of the Company.

        (o)     "STOCK AWARD" - A Grant made under the Plan in stock or
                denominated in units of stock for which the Participant is not
                obligated to pay additional consideration.

2.      Administration. The Plan shall be administered by the Board, provided
        however, that the Board may delegate such administration to the
        Committee. Subject to the provisions of the Plan, the Board and/or the
        Committee shall have authority to (a) grant, in its discretion,
        Incentive Stock Options in accordance with Section 422 of the Code, or
        Nonstatutory Options, Stock Awards or Restricted Stock Purchase Offers;
        (b) determine in good faith the fair market value of the Stock covered
        by any Grant; (c) determine which eligible persons shall receive Grants
        and the number of shares, restrictions, terms and conditions to be
        included in such Grants; (d) construe and interpret the Plan; (e)
        promulgate, amend and rescind rules and regulations relating to its
        administration, and correct defects, omissions and inconsistencies in
        the Plan or any Grant; (f) consistent with the Plan and with the consent
        of the Participant, as appropriate, amend any outstanding Grant or amend
        the exercise date or dates thereof; (g) determine the duration and
        purpose of leaves of absence which may be granted to Participants
        without constituting termination of their employment for the purpose of
        the Plan or any Grant; and (h) make all other determinations necessary
        or advisable for the Plan's administration. The interpretation and
        construction by the Board of any provisions of the Plan or selection of
        Participants shall be conclusive and final. No member of the Board or
        the Committee shall be liable for any action or determination made in
        good faith with respect to the Plan or any Grant made thereunder.

3.      Eligibility.

        (a)     GENERAL: The persons who shall be eligible to receive Grants
                shall be directors, officers, employees or consultants to the
                Company. The term consultant shall mean any person, other than
                an employee, who is engaged by the Company to render services
                and is compensated for such services. An Optionee may hold more
                than one Option. Any issuance of a Grant to an officer or
                director of the Company subsequent to the first registration of
                any of the securities of the Company under the Exchange Act
                shall comply with the requirements of Rule 16b-3.

<PAGE>

        (b)     INCENTIVE STOCK OPTIONS: Incentive Stock Options may only be
                issued to employees of the Company. Incentive Stock Options may
                be granted to officers or directors, provided they are also
                employees of the Company. Payment of a director's fee shall not
                be sufficient to constitute employment by the Company.

                        The Company shall not grant an Incentive Stock Option
                under the Plan to any employee if such Grant would result in
                such employee holding the right to exercise for the first time
                in any one calendar year, under all Incentive Stock Options
                granted under the Plan or any other plan maintained by the
                Company, with respect to shares of Stock having an aggregate
                fair market value, determined as of the date of the Option is
                granted, in excess of $100,000. Should it be determined that an
                Incentive Stock Option granted under the Plan exceeds such
                maximum for any reason other than a failure in good faith to
                value the Stock subject to such option, the excess portion of
                such option shall be considered a Nonstatutory Option. To the
                extent the employee holds two (2) or more such Options which
                become exercisable for the first time in the same calendar year,
                the foregoing limitation on the exercisability of such Option as
                Incentive Stock Options under the Federal tax laws shall be
                applied on the basis of the order in which such Options are
                granted. If, for any reason, an entire Option does not qualify
                as an Incentive Stock Option by reason of exceeding such
                maximum, such Option shall be considered a Nonstatutory Option.

        (c)     NONSTATUTORY OPTION: The provisions of the foregoing Section
                3(b) shall not apply to any Option designated as a "NONSTATUTORY
                OPTION" or which sets forth the intention of the parties that
                the Option be a Nonstatutory Option.

        (d)     STOCK AWARDS AND RESTRICTED STOCK PURCHASE OFFERS: The
                provisions of this Section 3 shall not apply to any Stock Award
                or Restricted Stock Purchase Offer under the Plan.

4.      Stock.

        (a)     AUTHORIZED STOCK: Stock subject to Grants may be either unissued
                or reacquired Stock.

        (b)     NUMBER OF SHARES: Subject to adjustment as provided in Section
                5(i) of the Plan, the total number of shares of Stock which may
                be purchased or granted directly by Options, Stock Awards or
                Restricted Stock Purchase Offers, or purchased indirectly
                through exercise of Options granted under the Plan shall not
                exceed _______________________ (__________). If any Grant shall
                for any reason terminate or expire, any shares allocated thereto
                but remaining unpurchased upon such expiration or termination
                shall again be available for Grants with respect thereto under
                the Plan as though no Grant had previously occurred with respect
                to such shares. Any shares of Stock issued pursuant to a Grant
                and repurchased pursuant to the terms thereof shall be available
                for future Grants as though not previously covered by a Grant.

<PAGE>

        (c)     RESERVATION OF SHARES: The Company shall reserve and keep
                available at all times during the term of the Plan such number
                of shares as shall be sufficient to satisfy the requirements of
                the Plan. If, after reasonable efforts, which efforts shall not
                include the registration of the Plan or Grants under the
                Securities Act, the Company is unable to obtain authority from
                any applicable regulatory body, which authorization is deemed
                necessary by legal counsel for the Company for the lawful
                issuance of shares hereunder, the Company shall be relieved of
                any liability with respect to its failure to issue and sell the
                shares for which such requisite authority was so deemed
                necessary unless and until such authority is obtained.

        (d)     APPLICATION OF FUNDS: The proceeds received by the Company from
                the sale of Stock pursuant to the exercise of Options or rights
                under Stock Purchase Agreements will be used for general
                corporate purposes.

        (e)     NO OBLIGATION TO EXERCISE: The issuance of a Grant shall impose
                no obligation upon the Participant to exercise any rights under
                such Grant.

5.      Terms and Conditions of Options. Options granted hereunder shall be
        evidenced by agreements between the Company and the respective
        Optionees, in such form and substance as the Board or Committee shall
        from time to time approve. The form of Incentive Stock Option Agreement
        attached hereto as EXHIBIT A and the three forms of a Nonstatutory Stock
        Option Agreement for employees, for directors and for consultants,
        attached hereto as EXHIBIT B-1, EXHIBIT B-2 and EXHIBIT B-3,
        respectively, shall be deemed to be approved by the Board. Option
        agreements need not be identical, and in each case may include such
        provisions as the Board or Committee may determine, but all such
        agreements shall be subject to and limited by the following terms and
        conditions:

        (a)     NUMBER OF SHARES: Each Option shall state the number of shares
                to which it pertains.

        (b)     EXERCISE PRICE: Each Option shall state the exercise price,
                which shall be determined as follows:

                (i)     Any Incentive Stock Option granted to a person who at
                        the time the Option is granted owns (or is deemed to own
                        pursuant to Section 424(d) of the Code) stock possessing
                        more than ten percent (10%) of the total combined voting
                        power or value of all classes of stock of the Company
                        ("TEN PERCENT HOLDER") shall have an exercise price of
                        no less than 110% of the Fair Market Value of the Stock
                        as of the date of grant; and

                (ii)    Incentive Stock Options granted to a person who at the
                        time the Option is granted is not a Ten Percent Holder
                        shall have an exercise price of no less than 100% of the
                        Fair Market Value of the Stock as of the date of grant.

<PAGE>

                        For the purposes of this Section 5(b), the Fair Market
                Value shall be as determined by the Board in good faith, which
                determination shall be conclusive and binding; provided however,
                that if there is a public market for such Stock, the Fair Market
                Value per share shall be the average of the bid and asked prices
                (or the closing price if such stock is listed on the NASDAQ
                National Market System or Small Cap Issue Market) on the date of
                grant of the Option, or if listed on a stock exchange, the
                closing price on such exchange on such date of grant.

        (c)     MEDIUM AND TIME OF PAYMENT: The exercise price shall become
                immediately due upon exercise of the Option and shall be paid in
                cash or check made payable to the Company. Should the Company's
                outstanding Stock be registered under Section 12(g) of the
                Exchange Act at the time the Option is exercised, then the
                exercise price may also be paid as follows:

                (i)     in shares of Stock held by the Optionee for the
                        requisite period necessary to avoid a charge to the
                        Company's earnings for financial reporting purposes and
                        valued at Fair Market Value on the exercise date, or

                (ii)    through a special sale and remittance procedure pursuant
                        to which the Optionee shall concurrently provide
                        irrevocable written instructions (a) to a Company
                        designated brokerage firm to effect the immediate sale
                        of the purchased shares and remit to the Company, out of
                        the sale proceeds available on the settlement date,
                        sufficient funds to cover the aggregate exercise price
                        payable for the purchased shares plus all applicable
                        Federal, state and local income and employment taxes
                        required to be withheld by the Company by reason of such
                        purchase and (b) to the Company to deliver the
                        certificates for the purchased shares directly to such
                        brokerage firm in order to complete the sale
                        transaction.

                        At the discretion of the Board, exercisable either at
                the time of Option grant or of Option exercise, the exercise
                price may also be paid (i) by Optionee's delivery of a
                promissory note in form and substance satisfactory to the
                Company and permissible under the Securities Rules of the State
                of Delaware and bearing interest at a rate determined by the
                Board in its sole discretion, but in no event less than the
                minimum rate of interest required to avoid the imputation of
                compensation income to the Optionee under the Federal tax laws,
                or (ii) in such other form of consideration permitted by the
                Delaware corporations law as may be acceptable to the Board.

        (d)     TERM AND EXERCISE OF OPTIONS: Any Option granted to an employee
                of the Company shall become exercisable over a period of no
                longer than ten (10) years, and no less than twenty percent
                (20%) of the shares covered thereby shall become exercisable
                annually. No Option shall be exercisable, in whole or in part,
                prior to one (1) year from the date it is granted unless the
                Board shall specifically determine otherwise, as provided
                herein. In no event shall any Option be exercisable after the
                expiration of ten (10) years from the date it is granted, and no
                Incentive Stock Option granted to a

<PAGE>

                Ten Percent Holder shall, by its terms, be exercisable after the
                expiration of five (5) years from the date of the Option. Unless
                otherwise specified by the Board or the Committee in the
                resolution authorizing such Option, the date of grant of an
                Option shall be deemed to be the date upon which the Board or
                the Committee authorizes the granting of such Option.

                        Each Option shall be exercisable to the nearest whole
                share, in installments or otherwise, as the respective Option
                agreements may provide. During the lifetime of an Optionee, the
                Option shall be exercisable only by the Optionee and shall not
                be assignable or transferable by the Optionee, and no other
                person shall acquire any rights therein. To the extent not
                exercised, installments (if more than one) shall accumulate, but
                shall be exercisable, in whole or in part, only during the
                period for exercise as stated in the Option agreement, whether
                or not other installments are then exercisable.

        (e)     TERMINATION OF STATUS AS EMPLOYEE, CONSULTANT OR DIRECTOR: If
                Optionee's status as an employee shall terminate for any reason
                other than Optionee's disability or death, then Optionee (or if
                the Optionee shall die after such termination, but prior to
                exercise, Optionee's personal representative or the person
                entitled to succeed to the Option) shall have the right to
                exercise the portions of any of Optionee's Incentive Stock
                Options which were exercisable as of the date of such
                termination, in whole or in part, not less than 30 days nor more
                than three (3) months after such termination (or, in the event
                of "TERMINATION FOR GOOD CAUSE" as that term is defined in
                Delaware case law related thereto, or by the terms of the Plan
                or the Option Agreement or an employment agreement, the Option
                shall automatically terminate as of the termination of
                employment as to all shares covered by the Option).

                        With respect to Nonstatutory Options granted to
                employees, directors or consultants, the Board may specify such
                period for exercise, not less than 30 days (except that in the
                case of "TERMINATION FOR CAUSE" or removal of a director, the
                Option shall automatically terminate as of the termination of
                employment or services as to shares covered by the Option,
                following termination of employment or services as the Board
                deems reasonable and appropriate. The Option may be exercised
                only with respect to installments that the Optionee could have
                exercised at the date of termination of employment or services.
                Nothing contained herein or in any Option granted pursuant
                hereto shall be construed to affect or restrict in any way the
                right of the Company to terminate the employment or services of
                an Optionee with or without cause.

        (f)     DISABILITY OF OPTIONEE: If an Optionee is disabled (within the
                meaning of Section 22(e)(3) of the Code) at the time of
                termination, the three (3) month period set forth in Section
                5(e) shall be a period, as determined by the Board and set forth
                in the Option, of not less than six months nor more than one
                year after such termination.

        (g)     DEATH OF OPTIONEE: If an Optionee dies while employed by,
                engaged as a consultant to, or serving as a Director of the
                Company, the portion of such Optionee's Option

<PAGE>

                which was exercisable at the date of death may be exercised, in
                whole or in part, by the estate of the decedent or by a person
                succeeding to the right to exercise such Option at any time
                within (i) a period, as determined by the Board and set forth in
                the Option, of not less than six (6) months nor more than one
                (1) year after Optionee's death, which period shall not be more,
                in the case of a Nonstatutory Option, than the period for
                exercise following termination of employment or services, or
                (ii) during the remaining term of the Option, whichever is the
                lesser. The Option may be so exercised only with respect to
                installments exercisable at the time of Optionee's death and not
                previously exercised by the Optionee.

        (h)     NONTRANSFERABILITY OF OPTION: No Option shall be transferable by
                the Optionee, except by will or by the laws of descent and
                distribution.

        (i)     RECAPITALIZATION: Subject to any required action of
                shareholders, the number of shares of Stock covered by each
                outstanding Option, and the exercise price per share thereof set
                forth in each such Option, shall be proportionately adjusted for
                any increase or decrease in the number of issued shares of Stock
                of the Company resulting from a stock split, stock dividend,
                combination, subdivision or reclassification of shares, or the
                payment of a stock dividend, or any other increase or decrease
                in the number of such shares affected without receipt of
                consideration by the Company; provided, however, the conversion
                of any convertible securities of the Company shall not be deemed
                to have been "EFFECTED WITHOUT RECEIPT OF CONSIDERATION" by the
                Company.

                        In the event of a proposed dissolution or liquidation of
                the Company, a merger or consolidation in which the Company is
                not the surviving entity, or a sale of all or substantially all
                of the assets or capital stock of the Company (collectively, a
                "REORGANIZATION"), unless otherwise provided by the Board, this
                Option shall terminate immediately prior to such date as is
                determined by the Board, which date shall be no later than the
                consummation of such Reorganization. In such event, if the
                entity which shall be the surviving entity does not tender to
                Optionee an offer, for which it has no obligation to do so, to
                substitute for any unexercised Option a stock option or capital
                stock of such surviving of such surviving entity, as applicable,
                which on an equitable basis shall provide the Optionee with
                substantially the same economic benefit as such unexercised
                Option, then the Board may grant to such Optionee, in its sole
                and absolute discretion and without obligation, the right for a
                period commencing thirty (30) days prior to and ending
                immediately prior to the date determined by the Board pursuant
                hereto for termination of the Option or during the remaining
                term of the Option, whichever is the lesser, to exercise any
                unexpired Option or Options without regard to the installment
                provisions of Paragraph 6(d) of the Plan; provided, that any
                such right granted shall be granted to all Optionees not
                receiving an offer to receive substitute options on a consistent
                basis, and provided further, that any such exercise shall be
                subject to the consummation of such Reorganization.

<PAGE>

                        Subject to any required action of shareholders, if the
                Company shall be the surviving entity in any merger or
                consolidation, each outstanding Option thereafter shall pertain
                to and apply to the securities to which a holder of shares of
                Stock equal to the shares subject to the Option would have been
                entitled by reason of such merger or consolidation.

                        In the event of a change in the Stock of the Company as
                presently constituted, which is limited to a change of all of
                its authorized shares without par value into the same number of
                shares with a par value, the shares resulting from any such
                change shall be deemed to be the Stock within the meaning of the
                Plan.

                        To the extent that the foregoing adjustments relate to
                stock or securities of the Company, such adjustments shall be
                made by the Board, whose determination in that respect shall be
                final, binding and conclusive. Except as expressly provided in
                this Section 5(i), the Optionee shall have no rights by reason
                of any subdivision or consolidation of shares of stock of any
                class or the payment of any stock dividend or any other increase
                or decrease in the number of shares of stock of any class, and
                the number or price of shares of Stock subject to any Option
                shall not be affected by, and no adjustment shall be made by
                reason of, any dissolution, liquidation, merger, consolidation
                or sale of assets or capital stock, or any issue by the Company
                of shares of stock of any class or securities convertible into
                shares of stock of any class.

                        The Grant of an Option pursuant to the Plan shall not
                affect in any way the right or power of the Company to make any
                adjustments, reclassifications, reorganizations or changes in
                its capital or business structure or to merge, consolidate,
                dissolve, or liquidate or to sell or transfer all or any part of
                its business or assets.

        (j)     RIGHTS AS A SHAREHOLDER: An Optionee shall have no rights as a
                shareholder with respect to any shares covered by an Option
                until the effective date of the issuance of the shares following
                exercise of such Option by Optionee. No adjustment shall be made
                for dividends (ordinary or extraordinary, whether in cash,
                securities or other property) or distributions or other rights
                for which the record date is prior to the date such stock
                certificate is issued, except as expressly provided in Section
                5(i) hereof.

        (k)     MODIFICATION, ACCELERATION, EXTENSION, AND RENEWAL OF OPTIONS:
                Subject to the terms and conditions and within the limitations
                of the Plan, the Board may modify an Option, or, once an Option
                is exercisable, accelerate the rate at which it may be
                exercised, and may extend or renew outstanding Options granted
                under the Plan or accept the surrender of outstanding Options
                (to the extent not theretofore exercised) and authorize the
                granting of new Options in substitution for such Options,
                provided such action is permissible under Section 422 of the
                Code and the Delaware Securities Rules. Notwithstanding the
                provisions of this Section 5(k), however, no modification of an
                Option shall, without the consent of the Optionee, alter to the
                Optionee's detriment or impair any rights or obligations under
                any Option theretofore granted under the Plan.

<PAGE>

        (l)     EXERCISE BEFORE EXERCISE DATE: At the discretion of the Board,
                the Option may, but need not, include a provision whereby the
                Optionee may elect to exercise all or any portion of the Option
                prior to the stated exercise date of the Option or any
                installment thereof. Any shares so purchased prior to the stated
                exercise date shall be subject to repurchase by the Company upon
                termination of Optionee's employment as contemplated by Section
                5(n) hereof prior to the exercise date stated in the Option and
                such other restrictions and conditions as the Board or Committee
                may deem advisable.

        (m)     OTHER PROVISIONS: The Option agreements authorized under the
                Plan shall contain such other provisions, including, without
                limitation, restrictions upon the exercise of the Options, as
                the Board or the Committee shall deem advisable. Shares shall
                not be issued pursuant to the exercise of an Option, if the
                exercise of such Option or the issuance of shares thereunder
                would violate, in the opinion of legal counsel for the Company,
                the provisions of any applicable law or the rules or regulations
                of any applicable governmental or administrative agency or body,
                such as the Code, the Securities Act, the Exchange Act, the
                Delaware Securities Rules, Delaware corporation law, and the
                rules promulgated under the foregoing or the rules and
                regulations of any exchange upon which the shares of the Company
                are listed. Without limiting the generality of the foregoing,
                the exercise of each Option shall be subject to the condition
                that if at any time the Company shall determine that (i) the
                satisfaction of withholding tax or other similar liabilities, or
                (ii) the listing, registration or qualification of any shares
                covered by such exercise upon any securities exchange or under
                any state or federal law, or (iii) the consent or approval of
                any regulatory body, or (iv) the perfection of any exemption
                from any such withholding, listing, registration, qualification,
                consent or approval is necessary or desirable in connection with
                such exercise or the issuance of shares thereunder, then in any
                such event, such exercise shall not be effective unless such
                withholding, listing registration, qualification, consent,
                approval or exemption shall have been effected, obtained or
                perfected free of any conditions not acceptable to the Company.

        (n)     REPURCHASE AGREEMENT: The Board may, in its discretion, require
                as a condition to the Grant of an Option hereunder, that an
                Optionee execute an agreement with the Company, in form and
                substance satisfactory to the Board in its discretion
                ("REPURCHASE AGREEMENT"), (i) restricting the Optionee's right
                to transfer shares purchased under such Option without first
                offering such shares to the Company or another shareholder of
                the Company upon the same terms and conditions as provided
                therein; and (ii) providing that upon termination of Optionee's
                employment with the Company, for any reason, the Company (or
                another shareholder of the Company, as provided in the
                Repurchase Agreement) shall have the right at its discretion (or
                the discretion of such other shareholders) to purchase and/or
                redeem all such shares owned by the Optionee on the date of
                termination of his or her employment at a price equal to: (A)
                the fair value of such shares as of such date of termination; or
                (B) if such repurchase right lapses at 20% of the number of
                shares

<PAGE>

                per year, the original purchase price of such shares, and upon
                terms of payment permissible under the Delaware Securities
                Rules; provided that in the case of Options or Stock Awards
                granted to officers, directors, consultants or affiliates of the
                Company, such repurchase provisions may be subject to additional
                or greater restrictions as determined by the Board or Committee.

6.      Stock Awards and Restricted Stock Purchase Offers.

        (a)     TYPES OF GRANTS.

                (i)     STOCK AWARD. All or part of any Stock Award under the
                        Plan may be subject to conditions established by the
                        Board or the Committee, and set forth in the Stock Award
                        Agreement, which may include, but are not limited to,
                        continuous service with the Company, achievement of
                        specific business objectives, increases in specified
                        indices, attaining growth rates and other comparable
                        measurements of Company performance. Such Awards may be
                        based on Fair Market Value or other specified valuation.
                        All Stock Awards will be made pursuant to the execution
                        of a Stock Award Agreement substantially in the form
                        attached hereto as EXHIBIT C.

                (ii)    RESTRICTED STOCK PURCHASE OFFER. A Grant of a Restricted
                        Stock Purchase Offer under the Plan shall be subject to
                        such (i) vesting contingencies related to the
                        Participant's continued association with the Company for
                        a specified time and (ii) other specified conditions as
                        the Board or Committee shall determine, in their sole
                        discretion, consistent with the provisions of the Plan.
                        All Restricted Stock Purchase Offers shall be made
                        pursuant to a Restricted Stock Purchase Offer
                        substantially in the form attached hereto as EXHIBIT D.

        (b)     CONDITIONS AND RESTRICTIONS. Shares of Stock which Participants
                may receive as a Stock Award under a Stock Award Agreement or
                Restricted Stock Purchase Offer under a Restricted Stock
                Purchase Offer may include such restrictions as the Board or
                Committee, as applicable, shall determine, including
                restrictions on transfer, repurchase rights, right of first
                refusal, and forfeiture provisions. When transfer of Stock is so
                restricted or subject to forfeiture provisions it is referred to
                as "RESTRICTED STOCK". Further, with Board or Committee
                approval, Stock Awards or Restricted Stock Purchase Offers may
                be deferred, either in the form of installments or a future lump
                sum distribution. The Board or Committee may permit selected
                Participants to elect to defer distributions of Stock Awards or
                Restricted Stock Purchase Offers in accordance with procedures
                established by the Board or Committee to assure that such
                deferrals comply with applicable requirements of the Code
                including, at the choice of Participants, the capability to make
                further deferrals for distribution after retirement. Any
                deferred distribution, whether elected by the Participant or
                specified by the Stock Award Agreement, Restricted Stock
                Purchase Offers or by the Board or Committee, may require the
                payment be forfeited in accordance with the provisions of
                Section 6(c). Dividends or dividend equivalent rights may be
                extended to and made part of any Stock Award or Restricted Stock

<PAGE>

                Purchase Offers denominated in Stock or units of Stock, subject
                to such terms, conditions and restrictions as the Board or
                Committee may establish.

        (c)     CANCELLATION AND RESCISSION OF GRANTS. Unless the Stock Award
                Agreement or Restricted Stock Purchase Offer specifies
                otherwise, the Board or Committee, as applicable, may cancel any
                unexpired, unpaid, or deferred Grants at any time if the
                Participant is not in compliance with all other applicable
                provisions of the Stock Award Agreement or Restricted Stock
                Purchase Offer, the Plan and with the following conditions:

                (i)     A Participant shall not render services for any
                        organization or engage directly or indirectly in any
                        business which, in the judgment of the chief executive
                        officer of the Company or other senior officer
                        designated by the Board or Committee, is or becomes
                        competitive with the Company, or which organization or
                        business, or the rendering of services to such
                        organization or business, is or becomes otherwise
                        prejudicial to or in conflict with the interests of the
                        Company. For Participants whose employment has
                        terminated, the judgment of the chief executive officer
                        shall be based on the Participant's position and
                        responsibilities while employed by the Company, the
                        Participant's post-employment responsibilities and
                        position with the other organization or business, the
                        extent of past, current and potential competition or
                        conflict between the Company and the other organization
                        or business, the effect on the Company's customers,
                        suppliers and competitors and such other considerations
                        as are deemed relevant given the applicable facts and
                        circumstances. A Participant who has retired shall be
                        free, however, to purchase as an investment or
                        otherwise, stock or other securities of such
                        organization or business so long as they are listed upon
                        a recognized securities exchange or traded
                        over-the-counter, and such investment does not represent
                        a substantial investment to the Participant or a greater
                        than ten percent (10%) equity interest in the
                        organization or business.

                (ii)    A Participant shall not, without prior written
                        authorization from the Company, disclose to anyone
                        outside the Company, or use in other than the Company's
                        business, any confidential information or material, as
                        defined in the Company's Proprietary Information and
                        Invention Agreement or similar agreement regarding
                        confidential information and intellectual property,
                        relating to the business of the Company, acquired by the
                        Participant either during or after employment with the
                        Company.

                (iii)   A Participant, pursuant to the Company's Proprietary
                        Information and Invention Agreement, shall disclose
                        promptly and assign to the Company all right, title and
                        interest in any invention or idea, patentable or not,
                        made or conceived by the Participant during employment
                        by the Company, relating in any manner to the actual or
                        anticipated business, research or development work of
                        the Company and shall do anything reasonably necessary
                        to enable the Company to secure a patent where
                        appropriate in the United States and in foreign
                        countries.

<PAGE>

                (iv)    Upon exercise, payment or delivery pursuant to a Grant,
                        the Participant shall certify on a form acceptable to
                        the Committee that he or she is in compliance with the
                        terms and conditions of the Plan. Failure to comply with
                        all of the provisions of this Section 6(c) prior to, or
                        during the six months after, any exercise, payment or
                        delivery pursuant to a Grant shall cause such exercise,
                        payment or delivery to be rescinded. The Company shall
                        notify the Participant in writing of any such rescission
                        within two years after such exercise, payment or
                        delivery. Within ten days after receiving such a notice
                        from the Company, the Participant shall pay to the
                        Company the amount of any gain realized or payment
                        received as a result of the rescinded exercise, payment
                        or delivery pursuant to a Grant. Such payment shall be
                        made either in cash or by returning to the Company the
                        number of shares of Stock that the Participant received
                        in connection with the rescinded exercise, payment or
                        delivery.

        (d)     NONASSIGNABILITY.

                (i)     Except pursuant to Section 6(e)(iii) and except as set
                        forth in Section 6(d)(ii), no Grant or any other benefit
                        under the Plan shall be assignable or transferable, or
                        payable to or exercisable by, anyone other than the
                        Participant to whom it was granted.

                (ii)    Where a Participant terminates employment and retains a
                        Grant pursuant to Section 6(e)(ii) in order to assume a
                        position with a governmental, charitable or educational
                        institution, the Board or Committee, in its discretion
                        and to the extent permitted by law, may authorize a
                        third party (including but not limited to the trustee of
                        a "blind" trust), acceptable to the applicable
                        governmental or institutional authorities, the
                        Participant and the Board or Committee, to act on behalf
                        of the Participant with regard to such Awards.

        (e)     TERMINATION OF EMPLOYMENT. If the employment or service to the
                Company of a Participant terminates, other than pursuant to any
                of the following provisions under this Section 6(e), all
                unexercised, deferred and unpaid Stock Awards or Restricted
                Stock Purchase Offers shall be cancelled immediately, unless the
                Stock Award Agreement or Restricted Stock Purchase Offer
                provides otherwise:

                (i)     RETIREMENT UNDER A COMPANY RETIREMENT PLAN. When a
                        Participant's employment terminates as a result of
                        retirement in accordance with the terms of a Company
                        retirement plan, the Board or Committee may permit Stock
                        Awards or Restricted Stock Purchase Offers to continue
                        in effect beyond the date of retirement in accordance
                        with the applicable Grant Agreement and the
                        exercisability and vesting of any such Grants may be
                        accelerated.

                (ii)    RIGHTS IN THE BEST INTERESTS OF THE COMPANY. When a
                        Participant resigns from the Company and, in the
                        judgment of the Board or Committee, the

<PAGE>

                        acceleration and/or continuation of outstanding Stock
                        Awards or Restricted Stock Purchase Offers would be in
                        the best interests of the Company, the Board or
                        Committee may (i) authorize, where appropriate, the
                        acceleration and/or continuation of all or any part of
                        Grants issued prior to such termination and (ii) permit
                        the exercise, vesting and payment of such Grants for
                        such period as may be set forth in the applicable Grant
                        Agreement, subject to earlier cancellation pursuant to
                        Section 9 or at such time as the Board or Committee
                        shall deem the continuation of all or any part of the
                        Participant's Grants are not in the Company's best
                        interest.

                (iii)   DEATH OR DISABILITY OF A PARTICIPANT.

                        (1)     In the event of a Participant's death, the
                                Participant's estate or beneficiaries shall have
                                a period up to the expiration date specified in
                                the Grant Agreement within which to receive or
                                exercise any outstanding Grant held by the
                                Participant under such terms as may be specified
                                in the applicable Grant Agreement. Rights to any
                                such outstanding Grants shall pass by will or
                                the laws of descent and distribution in the
                                following order: (a) to beneficiaries so
                                designated by the Participant; if none, then (b)
                                to a legal representative of the Participant; if
                                none, then (c) to the persons entitled thereto
                                as determined by a court of competent
                                jurisdiction. Grants so passing shall be made at
                                such times and in such manner as if the
                                Participant were living.

                        (2)     In the event a Participant is deemed by the
                                Board or Committee to be unable to perform his
                                or her usual duties by reason of mental disorder
                                or medical condition which does not result from
                                facts which would be grounds for termination for
                                cause, Grants and rights to any such Grants may
                                be paid to or exercised by the Participant, if
                                legally competent, or a committee or other
                                legally designated guardian or representative if
                                the Participant is legally incompetent by virtue
                                of such disability.

                        (3)     After the death or disability of a Participant,
                                the Board or Committee may in its sole
                                discretion at any time (1) terminate
                                restrictions in Grant Agreements; (2) accelerate
                                any or all installments and rights; and (3)
                                instruct the Company to pay the total of any
                                accelerated payments in a lump sum to the
                                Participant, the Participant's estate,
                                beneficiaries or representative; notwithstanding
                                that, in the absence of such termination of
                                restrictions or acceleration of payments, any or
                                all of the payments due under the Grant might
                                ultimately have become payable to other
                                beneficiaries.

                        (4)     In the event of uncertainty as to interpretation
                                of or controversies concerning this Section 6,
                                the determinations of the Board or Committee, as
                                applicable, shall be binding and conclusive.

<PAGE>

7.      Investment Intent. All Grants under the Plan are intended to be exempt
        from registration under the Securities Act provided by Section 4(2)
        thereunder. Unless and until the granting of Options or sale and
        issuance of Stock subject to the Plan are registered under the
        Securities Act or shall be exempt pursuant to the rules promulgated
        thereunder, each Grant under the Plan shall provide that the purchases
        or other acquisitions of Stock thereunder shall be for investment
        purposes and not with a view to, or for resale in connection with, any
        distribution thereof. Further, unless the issuance and sale of the Stock
        have been registered under the Securities Act, each Grant shall provide
        that no shares shall be purchased upon the exercise of the rights under
        such Grant unless and until (i) all then applicable requirements of
        state and federal laws and regulatory agencies shall have been fully
        complied with to the satisfaction of the Company and its counsel, and
        (ii) if requested to do so by the Company, the person exercising the
        rights under the Grant shall (i) give written assurances as to knowledge
        and experience of such person (or a representative employed by such
        person) in financial and business matters and the ability of such person
        (or representative) to evaluate the merits and risks of exercising the
        Option, and (ii) execute and deliver to the Company a letter of
        investment intent and/or such other form related to applicable
        exemptions from registration, all in such form and substance as the
        Company may require. If shares are issued upon exercise of any rights
        under a Grant without registration under the Securities Act, subsequent
        registration of such shares shall relieve the purchaser thereof of any
        investment restrictions or representations made upon the exercise of
        such rights.

8.      Amendment, Modification, Suspension or Discontinuance of the Plan. The
        Board may, insofar as permitted by law, from time to time, with respect
        to any shares at the time not subject to outstanding Grants, suspend or
        terminate the Plan or revise or amend it in any respect whatsoever,
        except that without the approval of the shareholders of the Company, no
        such revision or amendment shall (i) increase the number of shares
        subject to the Plan, (ii) decrease the price at which Grants may be
        granted, (iii) materially increase the benefits to Participants, or (iv)
        change the class of persons eligible to receive Grants under the Plan;
        provided, however, no such action shall alter or impair the rights and
        obligations under any Option, or Stock Award, or Restricted Stock
        Purchase Offer outstanding as of the date thereof without the written
        consent of the Participant thereunder. No Grant may be issued while the
        Plan is suspended or after it is terminated, but the rights and
        obligations under any Grant issued while the Plan is in effect shall not
        be impaired by suspension or termination of the Plan.

                In the event of any change in the outstanding Stock by reason of
        a stock split, stock dividend, combination or reclassification of
        shares, recapitalization, merger, or similar event, the Board or the
        Committee may adjust proportionally (a) the number of shares of Stock
        (i) reserved under the Plan, (ii) available for Incentive Stock Options
        and Nonstatutory Options and (iii) covered by outstanding Stock Awards
        or Restricted Stock Purchase Offers; (b) the Stock prices related to
        outstanding Grants; and (c) the appropriate Fair Market Value and other
        price determinations for such Grants. In the event of any other change
        affecting the Stock or any distribution (other than normal cash
        dividends) to holders of Stock, such adjustments as may be deemed
        equitable by the Board or the Committee, including adjustments to avoid
        fractional shares, shall be made

<PAGE>

        to give proper effect to such event. In the event of a corporate merger,
        consolidation, acquisition of property or stock, separation,
        reorganization or liquidation, the Board or the Committee shall be
        authorized to issue or assume stock options, whether or not in a
        transaction to which Section 424(a) of the Code applies, and other
        Grants by means of substitution of new Grant Agreements for previously
        issued Grants or an assumption of previously issued Grants.

9.      Tax Withholding. The Company shall have the right to deduct applicable
        taxes from any Grant payment and withhold, at the time of delivery or
        exercise of Options, Stock Awards or Restricted Stock Purchase Offers or
        vesting of shares under such Grants, an appropriate number of shares for
        payment of taxes required by law or to take such other action as may be
        necessary in the opinion of the Company to satisfy all obligations for
        withholding of such taxes. If Stock is used to satisfy tax withholding,
        such stock shall be valued based on the Fair Market Value when the tax
        withholding is required to be made.

10.     Availability of Information. During the term of the Plan and any
        additional period during which a Grant granted pursuant to the Plan
        shall be exercisable, the Company shall make available, not later than
        one hundred and twenty (120) days following the close of each of its
        fiscal years, such financial and other information regarding the Company
        as is required by the bylaws of the Company and applicable law to be
        furnished in an annual report to the shareholders of the Company.

11.     Notice. Any written notice to the Company required by any of the
        provisions of the Plan shall be addressed to the chief personnel officer
        or to the chief executive officer of the Company, and shall become
        effective when it is received by the office of the chief personnel
        officer or the chief executive officer.

12.     Indemnification of Board. In addition to such other rights or
        indemnifications as they may have as directors or otherwise, and to the
        extent allowed by applicable law, the members of the Board and the
        Committee shall be indemnified by the Company against the reasonable
        expenses, including attorneys' fees, actually and necessarily incurred
        in connection with the defense of any claim, action, suit or proceeding,
        or in connection with any appeal thereof, to which they or any of them
        may be a party by reason of any action taken, or failure to act, under
        or in connection with the Plan or any Grant granted thereunder, and
        against all amounts paid by them in settlement thereof (provided such
        settlement is approved by independent legal counsel selected by the
        Company) or paid by them in satisfaction of a judgment in any such
        claim, action, suit or proceeding, except in any case in relation to
        matters as to which it shall be adjudged in such claim, action, suit or
        proceeding that such Board or Committee member is liable for negligence
        or misconduct in the performance of his or her duties; provided that
        within sixty (60) days after institution of any such action, suit or
        Board proceeding the member involved shall offer the Company, in
        writing, the opportunity, at its own expense, to handle and defend the
        same.

13.     Governing Law. The Plan and all determinations made and actions taken
        pursuant hereto, to the extent not otherwise governed by the Code or the
        securities laws of the

<PAGE>

        United States, shall be governed by the law of the State of Delaware and
        construed accordingly.

14.     Effective and Termination Dates. The Plan shall become effective on the
        date it is approved by the holders of a majority of the shares of Stock
        then outstanding. The Plan shall terminate ten years later, subject to
        earlier termination by the Board pursuant to Section 8.

        The foregoing 2005 Incentive Stock Plan (consisting of 14 pages,
including this page) was duly adopted and approved by the Board of Directors on
April __, 2005 and subject to the approval of the shareholders of the
Corporation on or before May 25, 2005.

                                        ABLE ENERGY, INC.,
                                        a Delaware corporation

                                        By:     _____________________________
                                                Christopher Westad
                                        Its:    President

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