Document:

exv10w2

Exhibit 10.2

EXECUTION COPY

COMMON STOCK VOTING AGREEMENT

          COMMON STOCK VOTING AGREEMENT, dated as of January 24, 2010 (this “Agreement”), by and
among Critical Homecare Solutions Holdings, Inc., a Delaware corporation (“CHS”), Kohlberg
Investors V, L.P. (“Stockholders’ Representative”), Richard H. Friedman, Barry A. Posner,
Richard M. Smith and Stanley G. Rosenbaum (each a “Principal Stockholder” and collectively,
the “Principal Stockholders”).

          WHEREAS, BioScrip, Inc., a Delaware corporation (the “Company”), CHS, Stockholders’
Representative, the Principal Stockholders, and Camelot Acquisition Corp., a Delaware corporation
and a wholly-owned subsidiary of the Company (“Merger Sub”), are entering into an Agreement
and Plan of Merger, dated as of the date hereof (as amended, supplemented or modified from time to
time in accordance with its terms, the “Merger Agreement”), which provides for the merger
of CHS with and into Merger Sub with Merger Sub surviving as the Surviving Corporation (the
“Merger”);

          WHEREAS, as of the date hereof, each of the Principal Stockholders is the holder of the number
of shares of common stock, par value $0.0001 per share (the “Common Stock”), of the Company
set forth opposite such Principal Stockholder’s name on Schedule 3.3(a) hereto (the shares
of Common Stock held by such Principal Stockholder are referred to herein as the “Owned Common
Stock”); and

          WHEREAS, as a condition to the willingness of CHS and Stockholders’ Representative to enter
into the Merger Agreement, CHS and Stockholders’ Representative have requested that the Principal
Stockholders agree, and each of the Principal Stockholders has agreed, to enter into this Agreement
with respect to all of the Common Stock now owned and which may hereafter be acquired (whether by
means of an exercise of a Common Stock Equivalent, purchase, dividend, distribution or in any other
way) by each such Principal Stockholder (collectively, the “Shares”).

          NOW, THEREFORE, in consideration of the mutual representations, warranties, covenants and
agreements contained in this Agreement, and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties to this Agreement hereby agree as
follows:

ARTICLE I

DEFINITIONS

          Capitalized terms used and not otherwise defined herein shall have the respective meanings
ascribed to them in the Merger Agreement as in effect on the date hereof.

 

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ARTICLE II

AGREEMENT OF PRINCIPAL STOCKHOLDER TO VOTE

          Section 2.1 Agreement to Vote. Each of the Principal Stockholders (severally and not
jointly) hereby agrees:

               (a) that at any time that the Company conducts a meeting of, or otherwise seeks a vote or
consent of, the holders of Common Stock for the purpose of approving and adopting the Merger, the
other transactions contemplated by the Merger Agreement and the actions required in furtherance
thereof, such Principal Stockholder shall vote, or provide a consent with respect to, his Shares
(x) in favor of the Merger, the other transactions contemplated by the Merger Agreement and the
actions required in furtherance thereof and (y) against any action or agreement that would compete
with, impede, delay or interfere with the approval of the Merger and the other transactions
contemplated by the Merger Agreement; and

               (b) that at the first annual meeting of the holders of Common Stock following the Closing (as
defined in the Merger Agreement) for the purpose of the election of directors to the Board of
Directors of the Company, such Principal Stockholder shall vote his Shares in favor of each of the
two individuals designated by Kohlberg Management V, L.L.C. pursuant to the terms of the New Parent
Stockholders Agreement (as defined in the Merger Agreement).

          Section 2.2 Fiduciary Duties. Notwithstanding anything to the contrary in this
Agreement, in the case of any Principal Stockholder who is a director of the Company, the
agreements of such Stockholder contained in this Agreement shall not govern, limit or restrict such
Principal Stockholder’s ability to exercise his or her fiduciary duties to the stockholders of the
Company under applicable laws in his or her capacity as a director of the Company.

ARTICLE III

REPRESENTATIONS AND WARRANTIES

OF EACH PRINCIPAL STOCKHOLDER

          Each Principal Stockholder hereby represents and warrants, severally and not jointly or
jointly and severally, to CHS and Stockholders’ Representative as follows:

          Section 3.1 Authority Relative to This Agreement. Such Principal Stockholder has all
necessary capacity, power and authority to execute and deliver this Agreement, to perform his
obligations hereunder and to consummate the transactions contemplated hereby. The execution and
delivery of this Agreement by such Principal Stockholder and the consummation by such Principal
Stockholder of the transactions contemplated hereby has been duly and validly authorized by such
Principal Stockholder, and no other proceedings on the part of such Principal Stockholder are
necessary to authorize this Agreement or to consummate such transactions. This Agreement has been

 

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duly and validly executed and delivered by such Principal Stockholder and, assuming the due
authorization, execution and delivery by each other party hereto, constitutes a legal, valid and
binding obligation of such Principal Stockholder, enforceable against such Principal Stockholder in
accordance with its terms.

          Section 3.2 No Conflict.

          (a) The execution and delivery of this Agreement by such Principal Stockholder does not, and
the performance of this Agreement by such Principal Stockholder shall not, (i) conflict with or
violate the organizational documents of such Principal Stockholder, if applicable, (ii) conflict
with or violate any Laws applicable to such Principal Stockholder or by which his Owned Common
Stock are bound or affected or (iii) result in any breach of or constitute a default (or an event
that with notice or lapse of time or both would become a default) under, or give to others any
rights of termination, amendment, acceleration or cancellation of, or result in the creation of an
Encumbrance on any of his Owned Common Stock pursuant to, any note, bond, mortgage, indenture,
contract, agreement, lease, license, permit, franchise or other instrument or obligation to which
such Principal Stockholder is a party or by which such Principal Stockholder or his Owned Common
Stock are bound or affected, except, in the case of clauses (ii) and (iii), for any such conflicts,
violations, breaches, defaults or other occurrences which would not prevent or delay the
performance by such Principal Stockholder of his obligations under this Agreement.

          (b) The execution and delivery of this Agreement by such Principal Stockholder does not, and
the performance of this Agreement by such Principal Stockholder shall not, require any consent,
approval, authorization or permit of, or filing with or notification to, any third party, court or
arbitrator or any Governmental Authority except (i) for applicable requirements, if any, of the
Exchange Act and (ii) where the failure to obtain such consents, approvals, authorizations or
permits, or to make such filings or notifications, would not prevent or delay the performance by
such Principal Stockholder of his obligations under this Agreement.

          Section 3.3 Title to the Owned Common Stock.

          (a) As of the date hereof, such Principal Stockholder is the owner of the Owned Common Stock
set forth opposite such Principal Stockholder’s name on Schedule 3.3(a) hereto. Except for
the Common Stock Equivalents (hereinafter defined) held by such Principal Stockholder, such Owned
Common Stock is all of the Common Stock owned, either of record or beneficially, whether held
directly or indirectly, by such Principal Stockholder.

          (b) All rights or interests exercisable for or convertible into Common Stock that are owned,
either of record or beneficially, by such Principal Stockholder are set forth on Schedule
3.3(b) hereto (“Common Stock Equivalents”).

          (c) The Owned Common Stock held by such Principal Stockholder is owned free and clear of all
Encumbrances, rights of first refusal, agreements or

 

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limitations on such Principal Stockholder’s voting rights, charges and other encumbrances of
any nature whatsoever. Such Principal Stockholder has not appointed or granted any proxy, which
appointment or grant is still effective, with respect to his Owned Common Stock.

          Section 3.4 No Finder’s Fee. No broker, investment banker, financial advisor or other
person is entitled to any broker’s, finder’s, financial advisor’s or other similar fee or
commission in connection with the transactions contemplated hereby based upon arrangements made by
or on behalf of the Principal Stockholder.

          Section 3.5 Reliance by CHS and Stockholders’ Representative. Such Principal
Stockholder understands and acknowledges that the CHS and Stockholders’ Representative are entering
into the Merger Agreement in reliance upon such Principal Stockholder’s execution and delivery of
this Agreement.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES

OF CHS AND STOCKHOLDERS’ REPRESENTATIVE

          CHS and Stockholders’ Representative hereby represent and warrant as to itself, severally and
not jointly, to each Principal Stockholder as follows:

          Section 4.1 Authority Relative to This Agreement. CHS and Stockholders’
Representative each have all necessary power and authority to execute and deliver this Agreement,
to perform its obligations hereunder and to consummate the transactions contemplated hereby. The
execution and delivery of this Agreement by CHS and Stockholders’ Representative and the
consummation by CHS and Stockholders’ Representative of the transactions contemplated hereby have
been duly and validly authorized by each of CHS and Stockholders’ Representative, and no other
proceedings on the part of CHS or Stockholders’ Representative are necessary to authorize this
Agreement or to consummate such transactions. This Agreement has been duly and validly executed
and delivered by each of CHS and Stockholders’ Representative and, assuming the due authorization,
execution and delivery by each other party hereto, constitutes a legal, valid and binding
obligation of each of CHS and Stockholders’ Representative, enforceable against each in accordance
with its terms.

          Section 4.2 No Conflict.

          (a) The execution and delivery of this Agreement by CHS and Stockholders’ Representative does
not, and the performance of this Agreement by CHS and Stockholders’ Representative shall not, (i)
conflict with or violate the organizational documents of CHS or Stockholders’ Representative, (ii)
conflict with, violate or require any consent or notice under any Laws applicable to CHS or
Stockholders’ Representative or (iii) result in any breach of or constitute a default (or an event
that with notice or lapse of time or both would become a default) under, or give to others any
rights of termination, amendment, acceleration or cancellation of any material note, bond,

 

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mortgage, indenture, contract, agreement, lease, license, permit, franchise or other
instrument or obligation to which CHS or Stockholders’ Representative is a party or by which CHS or
Stockholders’ Representative is bound or affected, except, in the case of clauses (ii) and (iii),
for any such conflicts, violations, breaches, defaults or other occurrences which would not prevent
or delay the performance by CHS or Stockholders’ Representative of its obligations under this
Agreement.

          (b) The execution and delivery of this Agreement by CHS and Stockholders’ Representative does
not, and the performance of this Agreement by CHS and Stockholders’ Representative shall not,
require any consent, approval, authorization or permit of, or filing with or notification to, any
court or arbitrator or any Governmental Authority except (i) for necessary consents and filings
under the HSR Act or set forth on Schedule 6.6 of the Merger Agreement and (ii)
where the failure to obtain such consents, approvals, authorizations or permits, or to make such
filings or notifications, would not prevent or delay the performance by CHS or Stockholders’
Representative of its obligations under this Agreement.

ARTICLE V

COVENANTS OF THE PRINCIPAL STOCKHOLDERS

          Section 5.1 No Inconsistent Agreements. Each Principal Stockholder hereby covenants
and agrees that, except as contemplated by this Agreement, such Principal Stockholder shall not
enter into any agreement or grant a proxy or power of attorney with respect to its Shares which is
inconsistent with this Agreement.

          Section 5.2 No Encumbrances. Each Principal Stockholder hereby covenants and agrees
that such Principal Stockholder shall not by any action or omission cause any Encumbrances, rights
of first refusal, agreements or limitations on such Principal Stockholder’s Shares or voting rights
with respect to his Shares.

          Section 5.3 No Transfer. Each Principal Stockholder hereby agrees that he or it shall
not, directly or indirectly, so long as this Agreement is in effect, offer for sale, sell,
transfer, give, assign or otherwise dispose of (each, a “Transfer”), or agree to Transfer,
any Shares (except to Transfer his Shares to another Principal Stockholder or to a Person that
agrees to be bound by the provisions of this Agreement with respect to the transferred Shares (such
agreement to be evidenced by a written agreement in form and substance reasonably acceptable to CHS
and Stockholders’ Representative)). Such Principal Stockholder agrees to promptly provide the
Company with the certificates (if such Shares are certificated) representing all of his Shares in
order for the Company to imprint the following legend on such certificates:

THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A VOTING AGREEMENT DATED AS
OF JANUARY 24, 2010, AS MAY BE AMENDED FROM TIME TO TIME. A COPY OF THE VOTING AGREEMENT
MAY BE OBTAINED FROM THE COMPANY WITHOUT CHARGE UPON THE WRITTEN REQUEST OF THE HOLDER
HEREOF.

 

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          Section 5.4 No Groups. Each Principal Stockholder agrees that he or it shall not, and
shall cause each of his Affiliates not to, become a member of a “group” (as that term is used in
Section 13(d) of the Exchange Act) with respect to any Shares or other voting securities of the
Company for the purpose of opposing or competing with the transactions contemplated by the Merger
Agreement.

          Section 5.5 No Public Statements. Each Principal Stockholder agrees that he or it
shall not, and shall cause each of his Affiliates and Representatives (other than the Company and
its Representatives) not to, issue any press releases or make any public statements with respect to
this Agreement, the Merger Agreement or any of the transactions contemplated by the Merger
Agreement without the prior written consent of CHS, Stockholders’ Representative and the Company.

          Section 5.6 Commercially Reasonable Efforts. Each Principal Stockholder shall
promptly consult with the Company and use commercially reasonable efforts to provide any necessary
information and material with respect to all filings made by such Principal Stockholder with any
Governmental Authority in connection with this Agreement and the Merger Agreement and the
transactions contemplated hereby and thereby.

ARTICLE VI

MISCELLANEOUS

          Section 6.1 Termination. This Agreement shall terminate upon the earliest to occur of
(a) the completion of the first annual meeting of the holders of Common Stock following the Closing
and (b) the termination of the Merger Agreement in accordance with its terms. Any such termination
shall be without prejudice to liabilities arising hereunder before such termination.

          Section 6.2 Non-Survival. The representations and warranties made herein shall
terminate upon termination of this Agreement.

          Section 6.3 Specific Performance. The parties hereto agree that irreparable damage
would occur in the event that the provisions of this Agreement are not performed in accordance with
the terms hereof, that money damages would not be sufficient for any breach of this Agreement and
that the parties shall be entitled to specific performance of the terms hereof (without any
requirement for the posting of a bond or other security), in addition to any other remedy at law or
in equity.

          Section 6.4 Headings. The headings contained in this Agreement are for reference
purposes only and shall not in any way affect the meaning or interpretation of this Agreement.

          Section 6.5 Entire Agreement. This Agreement constitutes the entire agreement among
CHS, Stockholders’ Representative and the Principal Stockholders with respect to the subject matter
hereof and supersedes all prior agreements and

 

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understandings, both written and oral, among CHS, Stockholders’ Representative and the
Principal Stockholders with respect to the subject matter hereof.

          Section 6.6 No Third Party Beneficiaries. This Agreement is not intended to be for
the benefit of, and shall not be enforceable by, any Person or entity who or which is not a party
hereto, nor shall it confer upon any other Person any rights or remedies hereunder.

          Section 6.7 Waiver. Any waiver shall be valid only if set forth in writing signed by
the parties hereto. Mere inaction or failure to exercise any right, remedy or option under this
Agreement, or delay in exercising the same, will not operate as, nor shall be construed as, a
waiver, and each such right shall be deemed an ongoing right and may be asserted at any time and
from time to time.

          Section 6.8 Amendment. This Agreement may not be amended except by an instrument in
writing signed by each of the parties hereto.

          Section 6.9 Severability. If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced by any rule or law, or public policy, all other
conditions and provisions of this Agreement shall nevertheless remain in full force and effect so
long as the economic or legal substance of this Agreement is not affected in any manner materially
adverse to any party. Upon such determination that any term or other provision is invalid, illegal
or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the parties as closely as possible to the fullest
extent permitted by applicable law in a mutually acceptable manner in order that the terms of this
Agreement remain as originally contemplated.

          Section 6.10 Governing Law. This Agreement and any claim or controversy hereunder
(whether in contract or tort) shall be governed by and construed in accordance with the laws of the
State of Delaware without giving effect to the principles of conflict of laws thereof.

          Section 6.11 Jurisdiction and Service of Process. Any legal action, suit or
proceeding arising out of or relating to this Agreement or the transactions contemplated hereby may
only be instituted in any state or federal court in the State of Delaware, and each party waives
any objection which such party may now or hereafter have to the laying of the venue of any such
action, suit or proceeding, and irrevocably submits to the jurisdiction of any such court in any
such action, suit or proceeding. Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 6.16. Nothing in this Agreement shall affect
the right of any party to this Agreement to serve process in any other manner permitted by Law.

          Section 6.12 Waiver of Jury Trial. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL
PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS

 

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AGREEMENT OR THE TRANSACTIONS CONTEMPLATED (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER
THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER
PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES
HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS
AND CERTIFICATIONS IN THIS SECTION.

          Section 6.13 Rules of Construction. The parties to this Agreement agree that they
have been represented by counsel during the negotiation and execution of this Agreement and,
therefore, waive the application of any Laws or rule of construction providing that ambiguities in
an agreement or other document will be construed against the party drafting such agreement or
document.

          Section 6.14 Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which when so executed
shall be deemed to be an original and all of which taken together shall constitute one and the same
agreement.

          Section 6.15 Successors and Assigns. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective successors and
assigns, provided that no party may assign, delegate or otherwise transfer any of its rights or
obligations under this Agreement without the consent of the other parties hereto (and which
transfer shall not relieve such Principal Stockholder of his obligations hereunder in the event of
a breach by its transferee).

          Section 6.16 Notices. All notices, requests and other communications to any party
hereunder shall be in writing (including telecopy or similar writing) and shall be given,

if to the Principal Stockholders, to:

c/o BioScrip, Inc.

100 Clearbrook Road

Elmsford, NY 10523

Facsimile: (914) 460-1660

Attention: Barry A. Posner

with a copy to:

King and Spalding LLP

1185 Avenue of the Americas

New York, New York 10036

Facsimile: (212) 556-2222

Attention: E. William Bates, II, Esq.

 

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if to CHS, to:

Kohlberg Investors V, L.P.

c/o Kohlberg & Company

111 Radio Circle

Mount Kisco, New York 10549

Facsimile: (914) 241-1143

Attention: Gordon Woodward

with a copy to:

Paul, Weiss, Rifkind, Wharton & Garrison LLP

1285 Avenue of the Americas

New York, New York 10019

Telephone: (212) 373-3000

Facsimile: (212) 757-3990

Attention: Angelo Bonvino, Esq.

or such other address or facsimile number as such party may hereafter specify for the purpose by
notice to the other parties hereto given in accordance with this Section 6.16. Each such notice,
request or other communication shall be effective when delivered at the address specified in this
Section 6.16.

[Signature Page Follows]

 

     IN WITNESS WHEREOF, CHS, Stockholders’ Representative and each Principal Stockholder has
caused this Agreement to be duly executed as of the date hereof.

	 	 	 	 	 
	 	CRITICAL HOMECARE SOLUTIONS HOLDINGS, INC.

 	 
	 	By:  	/s/ Bob Cucuel
 	 
	 	 	Name:  	Bob Cucuel 	 
	 	 	Title:  	Pres & CEO 	 
	 
	 	KOHLBERG INVESTORS V, L.P. 	 
	 
	 

	By: Kohlberg Management V, L.L.C., its general
partner
	 	 	 
	 	By:  	                                                 /s/ Gordon H. Woodward
 	 
	 	 	Name:  	Gordon H. Woodward 	 
	 	 	Title:  	Authorized Representative 	 

Signature Page — Common Stock Voting Agreement

 

	 	 	 	 	 
	 

	 	THE PRINCIPAL STOCKHOLDERS:	 	 
	 
	 	 	 	 
	 

	 	RICHARD H. FRIEDMAN	 	 
	 
	 	 	 	 
	 

	 	/s/ Richard H. Friedman
 

	 	 
	 
	 	 	 	 
	 

	 	BARRY A. POSNER	 	 
	 
	 	 	 	 
	 

	 	/s/ Barry A. Posner	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	RICHARD M. SMITH	 	 
	 
	 	 	 	 
	 

	 	/s/ Richard M. Smith	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	STANLEY G. ROSENBAUM	 	 
	 
	 	 	 	 
	 

	 	/s/ Stanley G. Rosenbaum	 	 
	 

	 	 	 	 

Signature Page — Common Stock Voting Agreement

 

 

Schedule 3.3(a)

	 	 	 	 	 
	Principal Stockholders	 	Owned Common Stock
	Richard H. Friedman

	 	 	1,016,079	 
	Barry A. Posner

	 	 	50,126	 
	Richard M. Smith

	 	 	120,000	 
	Stanley G. Rosenbaum

	 	 	184,757	 

 

 

Schedule 3.3(b)

	 	 	 	 	 
	 	 	Common Stock
	Principal Stockholders	 	Equivalents
	Richard H. Friedman

	 	 	1,620,865	 
	Barry A. Posner

	 	 	468,012	 
	Richard M. Smith

	 	 	105,000	 
	Stanley G. Rosenbaum

	 	 	340,284exv10w1

Exhibit
10.1

EXECUTION
COPY

THIRD AMENDED AND RESTATED RECEIVABLES PURCHASE AGREEMENT

DATED AS OF JANUARY 25, 2010

BY AND AMONG

P&L RECEIVABLES COMPANY, LLC,

as Seller,

PEABODY ENERGY CORPORATION,

as initial Servicer,

ARCLAR COMPANY, LLC,

PEABODY MIDWEST MINING, LLC,

TWENTYMILE COAL, LLC,

CABALLO COAL, LLC,

COALSALES II, LLC,

PEABODY WESTERN COAL COMPANY,

POWDER RIVER COAL, LLC,

PEABODY HOLDING COMPANY, LLC,

COALTRADE, LLC,

and

COALSALES, LLC,

as Sub-Servicers,

THE VARIOUS CONDUIT PURCHASERS FROM TIME TO TIME PARTY HERETO,

THE VARIOUS RELATED COMMITTED PURCHASERS FROM TIME TO TIME PARTY HERETO,

THE VARIOUS PURCHASER AGENTS FROM TIME TO TIME PARTY HERETO,

THE VARIOUS LC PARTICIPANTS FROM TIME TO TIME PARTY HERETO,

and

PNC BANK, NATIONAL ASSOCIATION,

as Administrator and as LC Bank

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page
	ARTICLE I. AMOUNTS AND TERMS OF THE INVESTMENTS 
	 	 	2	 
	 
	Section 1.1 Investment Facility
	 	 	2	 
	 
	Section 1.2 Making Investments; Initial Investment; Initial Assignment and
Assumption
	 	 	3	 
	 
	Section 1.3 Transfer of Receivables and Other Purchased Assets
	 	 	6	 
	 
	Section 1.4 Terms and Conditions for Sale, Assignment and Transfer
	 	 	6	 
	 
	Section 1.5 Purchased Assets Coverage Percentage Computation
	 	 	9	 
	 
	Section 1.6 Settlement Procedures
	 	 	9	 
	 
	Section 1.7 Fees
	 	 	13	 
	 
	Section 1.8 Payments and Computations, Etc
	 	 	14	 
	 
	Section 1.9 Increased Costs
	 	 	15	 
	 
	Section 1.10 Requirements of Law
	 	 	15	 
	 
	Section 1.11 Inability to Determine Euro-Rate
	 	 	16	 
	 
	Section 1.12 Extension of the Facility Termination Date
	 	 	17	 
	 
	Section 1.13 Letters of Credit
	 	 	18	 
	 
	Section 1.14 Issuance of Letters of Credit
	 	 	18	 
	 
	Section 1.15 Requirements For Issuance of Letters of Credit
	 	 	19	 
	 
	Section 1.16 Disbursements, Reimbursement
	 	 	19	 
	 
	Section 1.17 Repayment of Participation Advances
	 	 	20	 
	 
	Section 1.18 Documentation
	 	 	20	 
	 
	Section 1.19 Determination to Honor Drawing Request
	 	 	21	 
	 
	Section 1.20 Nature of Participation and Reimbursement Obligations
	 	 	21	 
	 
	Section 1.21 Indemnity
	 	 	23	 
	 
	Section 1.22 Liability for Acts and Omissions
	 	 	23	 
	 
	ARTICLE II. REPRESENTATIONS AND WARRANTIES; COVENANTS; TERMINATION EVENTS
	 	 	24	 
	 
	Section 2.1 Representations and Warranties; Covenants
	 	 	24	 
	 
	Section 2.2 Termination Events
	 	 	25	 
	 
	ARTICLE III. INDEMNIFICATION 
	 	 	25	 
	 
	Section 3.1 Indemnities by the Seller
	 	 	25	 

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TABLE OF CONTENTS

(continued)

	 	 	 	 	 
	 	 	 	Page	 	 
	Section 3.2 Indemnities by the Servicer
	 	 	27	 
	 
	ARTICLE IV. ADMINISTRATION AND COLLECTIONS 
	 	 	27	 
	 
	Section 4.1 Appointment of the Servicer
	 	 	27	 
	 
	Section 4.2 Duties of the Servicer
	 	 	28	 
	 
	Section 4.3 Lock-Box Arrangements
	 	 	29	 
	 
	Section 4.4 Enforcement Rights
	 	 	29	 
	 
	Section 4.5 Responsibilities of the Seller
	 	 	30	 
	 
	Section 4.6 Servicing Fee
	 	 	31	 
	 
	Section 4.7 Agents
	 	 	31	 
	 
	ARTICLE V. MISCELLANEOUS 
	 	 	36	 
	 
	Section 5.1 Amendments, Etc
	 	 	36	 
	 
	Section 5.2 Notices, Etc
	 	 	36	 
	 
	Section 5.3 Successors and Assigns; Assignability; Participations
	 	 	37	 
	 
	Section 5.4 Costs, Expenses and Taxes
	 	 	39	 
	 
	Section 5.5 No Proceedings; Limitation on Payments
	 	 	39	 
	 
	Section 5.6 Confidentiality
	 	 	40	 
	 
	Section 5.7 GOVERNING LAW AND JURISDICTION
	 	 	40	 
	 
	Section 5.8 Execution in Counterparts
	 	 	41	 
	 
	Section 5.9 Survival of Termination; Non-Waiver
	 	 	41	 
	 
	Section 5.10 WAIVER OF JURY TRIAL
	 	 	41	 
	 
	Section 5.11 Entire Agreement
	 	 	41	 
	 
	Section 5.12 Headings
	 	 	42	 
	 
	Section 5.13 Sharing of Recoveries
	 	 	42	 
	 
	Section 5.14 Purchaser Groups’ Liabilities
	 	 	42	 
	 
	 
	 	 	 	 
	 
	EXHIBIT I             DEFINITIONS
	 	 	 	 
	EXHIBIT II            CONDITIONS PRECEDENT
	 	 	 	 
	EXHIBIT III           REPRESENTATIONS AND WARRANTIES
	 	 	 	 
	EXHIBIT IV           COVENANTS
	 	 	 	 
	EXHIBIT V            TERMINATION EVENTS
	 	 	 	 
	SCHEDULE I         CREDIT AND COLLECTION POLICY
	 	 	 	 

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TABLE OF CONTENTS

(continued)

	 	 	 	 	 
	 	 	Page	 
	SCHEDULE II              LOCK-BOX BANKS AND LOCK-BOX ACCOUNTS
	 	 	 	 
	SCHEDULE III            TRADE NAMES
	 	 	 	 
	SCHEDULE IV            OFFICE LOCATIONS
	 	 	 	 
	ANNEX A                    FORM OF INFORMATION PACKAGE
	 	 	 	 
	ANNEX B                    FORM OF INVESTMENT NOTICE
	 	 	 	 
	ANNEX C                    FORM OF PAYDOWN NOTICE
	 	 	 	 
	ANNEX D                    FORM OF COMPLIANCE CERTIFICATE
	 	 	 	 
	ANNEX E                     FORM OF LETTER OF CREDIT APPLICATION
	 	 	 	 
	ANNEX F                     FORM OF ASSUMPTION AGREEMENT
	 	 	 	 
	ANNEX G                    FORM OF TRANSFER SUPPLEMENT
	 	 	 	 

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     This THIRD AMENDED AND RESTATED RECEIVABLES PURCHASE AGREEMENT (as amended, supplemented or
otherwise modified from time to time, this “Agreement”) is entered into as of January 25,
2010, by and among P&L RECEIVABLES COMPANY, LLC, a Delaware limited liability company, as seller
(the “Seller”), PEABODY ENERGY CORPORATION, a Delaware corporation (“Peabody”), as
initial servicer (in such capacity, collectively, together with its successors and permitted
assigns in such capacity, the “Servicer”), ARCLAR COMPANY, LLC, an Indiana limited
liability company, PEABODY MIDWEST MINING, LLC, an Indiana limited liability company, TWENTYMILE
COAL, LLC, a Delaware limited liability company, CABALLO COAL, LLC, a Delaware limited liability
company, COALSALES II, LLC, a Delaware limited liability company, PEABODY WESTERN COAL COMPANY, a
Delaware corporation, POWDER RIVER COAL, LLC, a Delaware limited liability company, PEABODY HOLDING
COMPANY, LLC, a Delaware limited liability company, COALTRADE, LLC, a Delaware limited liability
company, COALSALES, LLC, a Delaware limited liability company (each a “Sub-Servicer” and
collectively the “Sub-Servicers”), the various CONDUIT PURCHASERS from time to time party
hereto, the various RELATED COMMITTED PURCHASERS from time to time party hereto, the various LC
PARTICIPANTS from time to time party hereto, the various PURCHASER AGENTS from time to time party
hereto, and PNC BANK, NATIONAL ASSOCIATION, a national banking association (“PNC”), as
administrator (in such capacity, together with its successors and assigns in such capacity, the
“Administrator”) and as issuer of Letters of Credit (in such capacity, together with its
successors and assigns in such capacity, the “LC Bank”).

     PRELIMINARY STATEMENTS. Certain terms that are capitalized and used throughout this Agreement
are defined in Exhibit I. References in the Exhibits hereto to the “Agreement” refer to
this Agreement, as amended, supplemented or otherwise modified from time to time.

     The Seller desires to sell, transfer and assign receivables, and the Purchasers desire to
acquire such receivables from time to time on the terms and subject to the conditions set forth
herein.

     This Agreement amends and restates in its entirety, as of the Closing Date, the Second Amended
and Restated Receivables Purchase Agreement, dated as of December 15, 2009 (as amended, restated,
supplemented or otherwise modified prior to the date hereof, the “Original Agreement”),
among the Seller, the Servicer, the Sub-Servicers, Market Street Funding LLC and the Administrator.
Notwithstanding the amendment and restatement of the Original Agreement by this Agreement, (i) the
Seller and Servicer shall continue to be liable to PNC, Market Street Funding LLC or any other
Indemnified Party or Affected Person (as such terms are defined in the Original Agreement) for fees
and expenses which are accrued and unpaid under the Original Agreement on the date hereof
(collectively, the “Original Agreement Outstanding Amounts”) and all agreements to
indemnify such parties in connection with events or conditions arising or existing prior to the
effective date of this Agreement and (ii) the security interest created under the Original
Agreement shall remain in full force and effect as security for such Original Agreement Outstanding
Amounts until such Original Agreement Outstanding Amounts shall have been paid in full. Upon the
effectiveness of this Agreement, each reference to the Original Agreement in any other document,
instrument or agreement shall mean and be a reference to this Agreement. Nothing contained herein,
unless expressly herein stated to the contrary, is intended

 

 

to amend, modify or otherwise affect any other instrument, document or agreement executed
and/or delivered in connection with the Original Agreement.

     In consideration of the mutual agreements, provisions and covenants contained herein, the
parties hereto agree as follows:

ARTICLE I.

AMOUNTS AND TERMS OF THE INVESTMENTS

     Section 1.1 Investment Facility.

     (a) On the terms and subject to the conditions hereof, the Seller may, from time to time
before the Facility Termination Date, (i) ratably (based on the aggregate Commitments of the
Related Committed Purchasers in their respective Purchaser Groups) request that the Conduit
Purchasers, or, only if a Conduit Purchaser denies such request or is unable to fund (and provides
notice of such denial or inability to the Seller, the Administrator and its Purchaser Agent),
ratably request that the Related Committed Purchasers, make investments (each, an
“Investment”) in the Purchased Assets and (ii) request that the LC Bank issue or cause the
issuance of Letters of Credit. Subject to Section 1.6(b) concerning reinvestments, at no
time will a Conduit Purchaser have any obligation to make an Investment. Each Related Committed
Purchaser severally hereby agrees, on the terms and subject to the conditions hereof, to make
Investments from time to time from the date hereof to the Facility Termination Date, based on the
applicable Purchaser Group’s Percentage of each Investment requested pursuant to Section
1.2(a) (and, in the case of each Related Committed Purchaser, its Commitment Percentage of its
Purchaser Group’s Percentage of such Investment) and, on the terms of and subject to the conditions
of this Agreement, the LC Bank agrees to issue Letters of Credit in return for (and each LC
Participant hereby severally agrees to make participation advances in connection with any draws
under such Letters of Credit equal to such LC Participant’s Pro Rata Share of such draws), the
Purchased Assets from time to time from the date hereof to the Facility Termination Date;
provided, that under no circumstances shall any Purchaser make any Investment (including,
without limitation, any mandatory deemed Investment pursuant to Section 1.1(b)) or issue
any Letters of Credit hereunder, as applicable, if, after giving effect to such Investment or
issuance, the (i) Group Capital of such Purchaser’s Purchaser Group would exceed (A) its Purchaser
Group’s Group Commitment (as the same may be reduced from time to time pursuant to Section
1.1(c)) minus (B) the related LC Participant’s Pro Rata Share of the LC Participation Amount,
(ii) the Aggregate Capital plus the LC Participation Amount would exceed the Purchase Limit, (iii)
the LC Participation Amount would exceed the aggregate of the Commitments of the LC Bank and the
LC Participants or (iv) the Purchased Assets Coverage Percentage would exceed 100%.

     The Seller may, subject to the requirements and conditions set forth herein, use the proceeds
of any Investment or Reinvestment by the Purchasers hereunder, to satisfy its Reimbursement
Obligation to the LC Bank and the LC Participants (ratably, based on the outstanding amounts funded
by the LC Bank and each such LC Participant) pursuant to Section 1.16 below.

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     (b) In addition, in the event the Seller fails to reimburse the LC Bank and each applicable LC
Participant for the full amount of any drawing under any Letter of Credit on the applicable Drawing
Date (out of its own funds available therefor, or otherwise, at such time), pursuant to Section
1.16, then the Seller shall, automatically (and without the requirement of any further action
on the part of any Person hereunder), be deemed to have requested a new Investment from the Conduit
Purchasers or Related Committed Purchasers, as applicable, on such date, pursuant to the terms
hereof, in an amount equal to the amount of such Reimbursement Obligation at such time. Subject to
the limitations on funding set forth in Section 1.1(a) above (and otherwise herein), the
Conduit Purchasers or Related Committed Purchasers, as applicable, shall fund such deemed
Investment request and deliver the proceeds thereof directly to the Administrator to be immediately
distributed (ratably) to the LC Bank and the applicable LC Participants in satisfaction of the
Seller’s Reimbursement Obligation pursuant to Section 1.16 below, to the extent of the
amounts permitted to be funded by the Conduit Purchasers or Related Committed Purchasers, as
applicable, at such time, hereunder.

     (c) The Seller may, upon at least 30 days’ written notice to the Administrator, irrevocably
reduce the unused portion of the Purchase Limit in whole or in part (but not below the amount that
would cause the Aggregate Capital plus the LC Participation Amount to exceed the Purchase Limit or
would cause the Group Capital of any Purchaser Group to exceed its Group Commitment, in each case,
after giving effect to such reduction); provided, that each partial reduction shall be in
the amount of at least $5,000,000, or an integral multiple of $1,000,000 in excess thereof, and
that, unless terminated in whole, the Purchase Limit shall in no event be reduced below
$50,000,000. Each reduction in the Commitments hereunder shall be made ratably among the
Purchasers in accordance with their respective Purchaser Group’s Percentages and their respective
Commitments. The Administrator shall promptly advise the Purchaser Agents of any notice pursuant to
this Section 1.1(c); it being understood that (in addition to and without limiting any
other requirements for termination, prepayment and/or the funding of the LC Collateral Account
hereunder) no such reduction shall be effective unless and until (i) in the case of a reduction of
the Purchase Limit in whole to zero ($0), the amount on deposit in the LC Collateral Account is at
least equal to the then outstanding LC Participation Amount and (ii) in the case of a partial
reduction, the amount on deposit in the LC Collateral Account is at least equal to the difference
between the then outstanding LC Participation Amount and the Purchase Limit as so reduced by such
partial reduction.

     Section 1.2 Making Investments; Initial Investment; Initial Assignment and Assumption.

     (a) Each request for any Investment hereunder may be made on any day upon the Seller’s
irrevocable written notice in the form of Annex B (each, an “Investment Notice”)
delivered to the Administrator and each Purchaser Agent in accordance with Section 5.2
(which notice must be received by the Administrator and each Purchaser Agent before 11:00 a.m., New
York City time) at least two Business Days before the requested Investment Date, which notice shall
specify: (A) the amount requested to be paid to the Seller (such amount, which shall not be less
than $300,000 and shall be in integral multiples of $100,000, with respect to each Purchaser Group,
(B) the requested date of such Investment (which shall be a Business Day) and (C) the

3

 

pro forma calculation of the Purchased Assets Coverage Percentage after giving effect to the increase in the
Capital.

     (b) On the date of each Investment hereunder, each applicable Purchaser (determined in
accordance with Section 1.1(a)) shall, upon satisfaction of the applicable conditions set
forth in Exhibit II, make available to the Seller in same day funds, at Bank of America,
N.A., account number 4426927763, ABA No. 026009593, an amount equal to the Capital of the
Investment being funded by such Purchaser.

     (c) Notwithstanding the otherwise applicable conditions precedent to Investments hereunder,
upon effectiveness of this Agreement in accordance with its terms and immediately prior to giving
effect to Section 1.2(d) below, Market Street Funding LLC, as a Conduit Purchaser, shall be
deemed to have outstanding Capital hereunder equal to its outstanding Capital under the Original
Agreement immediately prior to the effectiveness of this Agreement.

     (d) Immediately upon effectiveness of this Agreement in accordance with its terms and after
giving effect to Section1.2(c) above:

     (i) Market Street Funding LLC, as a Related Committed Purchaser, hereby assigns and
delegates to Calyon New York Branch, as a Related Committed Purchaser, $100,000,000 of
Market Street Funding LLC’s existing $275,000,000 Commitment and the related obligation
hereunder to make Investments and Reinvestments from time to time in accordance with the
terms hereof, and Calyon New York Branch, as a Related Committed Purchaser, hereby assumes
such $100,000,000 Commitment and such obligation hereunder to make Investments and
Reinvestments from time to time in accordance with the terms hereof;

     (ii) Market Street Funding LLC, as a Conduit Purchaser and as a Related Committed
Purchaser, hereby assigns and delegates to Atlantic Asset Securitization LLC, as a Conduit
Purchaser, $70,363,636 of the outstanding Capital funded by Market Street Funding LLC
through the date hereof, and Atlantic Asset Securitization LLC, as a Conduit Purchaser,
hereby accepts such $70,363,636 of outstanding Capital so assigned; provided, that payment by Atlantic Asset Securitization LLC to Market Street
Funding LLC of the amount payable by Atlantic Asset Securitization LLC pursuant to the
following paragraph shall be a condition precedent to the assignment effected by this
clause (ii); and

     (iii) PNC Bank, National Association, as an LC Participant, hereby assigns and
delegates to Calyon New York Branch, as an LC Participant, $100,000,000 of PNC Bank,
National Association’s $275,000,000 Commitment and the related obligation hereunder to make
participation advances to the LC Bank from time to time in accordance with the terms hereof,
and Calyon New York Branch, as an LC Participant, hereby assumes such $100,000,000
Commitment and such obligation hereunder to make participation advances to the LC Bank from
time to time in accordance with the terms hereof.

4

 

     As consideration for the foregoing assignments and assumptions, Atlantic Asset Securitization
LLC shall pay to Market Street Funding LLC by wire transfer of immediately available funds to the
account specified by Market Street Funding LLC (or by its Purchaser Agent on its behalf) on the
date hereof, $70,363,636. After giving effect to the assignments and assumptions described in
this Section 1.2(d) and effective as of the Closing Date:

     (i) there shall be two Purchaser Groups as follows, one of which consists of Market
Street Funding LLC, as a Conduit Purchaser and as a Related Committed Purchaser, and PNC
Bank, National Association, as LC Bank and as an LC Participant, and the other of which
consists of Altantic Asset Securitization LLC, as a Conduit Purchaser, and Calyon New York
Branch, as a Related Committed Purchaser and as an LC Participant;

     (ii) the Group Commitment of Market Street Funding LLC’s Purchaser Group shall be
$175,000,000, and the Group Commitment of Atlantic Asset Securitization LLC’s Purchaser
Group shall be $100,000,000;

     (iii) the Commitment of Market Street Funding LLC, as a Related Committed Purchaser
shall be $175,000,000, and the Commitment of Calyon New York Branch, as a Related Committed
Purchaser shall be $100,000,000;

     (iv) the Commitment of PNC Bank, National Association, as LC Bank and as an LC
Participant shall be $175,000,000, and the Commitment of Calyon New York Branch, as an LC
Participant shall be $100,000,000;

     (v) the Aggregate Capital shall be $193,500,000, the Capital funded by Market Street
Funding LLC shall be $123,136,364, and the Capital funded by Atlantic Asset Securitization
LLC shall be $70,363,636;

     (vi) Atlantic Asset Securitization LLC shall have the rights and obligations of a
Conduit Purchaser hereunder, and Calyon New York Branch shall have the rights and
obligations of a Related Committed Purchaser and LC Participant hereunder, to the extent of
the Commitments so assigned to and assumed by them, respectively; and

     (vii) Market Street Funding LLC and PNC Bank, National Association shall, to the extent
of the assignment by them pursuant to this Section 1.2(d), be released from the
portion of their respective Commitments so assigned.

     The parties hereto acknowledge and agree that the assignments and assumptions effected by this
Section 1.2(d) shall be deemed to satisfy the requirements of Section 1.4(g) and
Section 5.3(c) hereof relating to the execution and delivery of an Assumption Agreement and
a Transfer Supplement and any other requirements hereunder and under the Original Agreement for
assignments of Capital and Commitments.

5

 

     Section 1.3 Transfer of Receivables and Other Purchased Assets.

     (a) Sale of Receivables. In consideration of the Investments, assignments and
assumptions described in Sections 1.2(c) and 1.2(d) above, the entry into this
Agreement by the Administrator, the Purchasers and the Purchaser Agents and the Administrator’s
agreement (on behalf of the applicable Purchasers) to make payments to the Seller from time to time
in accordance with Section 1.4, effective on the Closing Date, the Seller hereby sells,
conveys, transfers and assigns to the Administrator, on behalf of the Purchasers, all of Seller’s
right, title and interest in and to (i) all Pool Receivables existing on the Closing Date or
thereafter arising or acquired by the Seller from time to time prior to the Facility Termination
Date and (ii) all Related Security, whether existing on the Closing Date or thereafter arising at
any time and acquired by the Seller.

     (b) Purchase of Purchased Assets. Subject to the terms and conditions hereof, the
Administrator (on behalf of the Purchasers) hereby purchases and accepts from the Seller the Pool
Receivables and all other Related Security sold, assigned and transferred pursuant to Section
1.3(a) (collectively, the “Purchased Assets”).

     (c) Obligations Not Assumed. The foregoing sale, assignment and transfer does not
constitute and is not intended to result in the creation, or an assumption by the Administrator,
any Purchaser Agent or any Purchaser, of any obligation of the Seller, any Originator or any other
Person under or in connection with the Receivables or any other Related Security, all of which
shall remain the obligations and liabilities of the Seller, the Originator and/or such other
Person, as applicable.

     Section 1.4 Terms and Conditions for Sale, Assignment and Transfer. Subject to the
terms and conditions hereof, including Exhibit II, in consideration for the sale,
assignment and transfer of the Purchased Assets by the Seller to the Administrator (on behalf of the
Purchasers) hereunder:

     (a) Investments. On the Closing Date, and thereafter from time to time prior to the
Facility Termination Date, on request of the Seller for an Investment in accordance with
Section 1.2(a), the applicable Purchasers in each Purchaser Group (determined in accordance
with Section 1.1(a)), in accordance with Section 1.2(b), shall pay to the Seller
the applicable Purchaser Group’s Percentage of the amount requested by the Seller under Section
1.2(a).

     (b) Reinvestments. On each Business Day prior to the Facility Termination Date, the
Servicer, on behalf of the Administrator, shall pay to the Seller, out of Collections of the Pool
Receivables, the amount available for reinvestment in accordance with Section 1.6(b)(ii).
Each such payment is herein referred to as a “Reinvestment”.

     (c) Deferred Purchase Price. The Servicer, on behalf of the Administrator and the
Purchasers, shall pay to the Seller, from Collections, the amounts payable to the Seller from time
to time pursuant to Section 1.6(b)(ii), Section 1.6(b)(iv) and clause sixth
of Section 1.6(d)(ii) (such amounts, the “Deferred Purchase Price” with respect to
the Purchased Assets) at the times specified in such Sections. The parties hereto acknowledge and
agree that the Administrator and

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the Purchasers shall have the right to, and intend to, set off (i)
the Seller’s obligation to pay (or cause to be paid) to the Purchasers (or to the Administrator on
their behalf) all Collections on the portion of the Purchased Assets attributable to the Deferred
Purchase Price against (ii) the Administrator’s and the Purchasers’ obligations to pay (or cause to
be paid) to the Seller the Deferred Purchase Price.

     (d) Seller Payments Limited to Collections. Notwithstanding any provision contained
in this Agreement to the contrary, none of the Administrator, the Purchaser Agents or the
Purchasers shall be obligated to pay any amount to the Seller as the purchase price of the
Purchased Assets pursuant to subsections (b) and (c) above except to the extent of
Collections on Receivables available for distribution to the Seller in accordance with this
Agreement. Any amount that the Administrator, any Purchaser Agent or any Purchaser does not pay
pursuant to the preceding sentence shall not constitute a claim (as defined in § 101 of the
Bankruptcy Code) against or corporate obligation of such Person for any such insufficiency unless
and until such amount becomes available for distribution to the Seller in accordance with
Section 1.6(d)(ii).

     (e) Intent of the Parties. The Seller, the Administrator, the Purchaser Agents and
the Purchasers intend that the sale, assignment and transfer of Purchased Assets to the
Administrator (on behalf of the Purchasers) shall be treated as a sale for all purposes (other than
for federal, state and local income and franchise tax purposes as provided in the following
paragraph of this clause (e)). If notwithstanding the intent of the parties, such sale,
transfer and assignment is not treated as a sale for such purposes, such sale, assignment and
transfer shall be treated as the grant of, and the Seller does hereby grant to the Administrator
(for the benefit of the Purchasers) a security interest in the following property to secure all of
the Seller’s obligations (monetary or otherwise) under this Agreement and the other Transaction Documents to which it is a party,
whether now or hereafter existing or arising, due or to become due, direct or indirect, absolute or
contingent: all of the Seller’s right, title and interest in, to and under all of the following,
whether now or hereafter owned, existing or arising: (i) all Pool Receivables, (ii) all Related
Security with respect to such Pool Receivables, (iii) all Collections with respect to such Pool
Receivables, (iv) the Lock-Box Accounts and all amounts on deposit therein, and all certificates
and instruments, if any, from time to time evidencing such Lock-Box Accounts and amounts on deposit
therein, (v) all rights (but none of the obligations) of the Seller, including any security
interests granted to it, under the Sale Agreement and the Contribution Agreement, (vi) the Servicer
Note and (vii) all proceeds of, and all amounts received or receivable under any or all of, the
foregoing (collectively, the “Pool Assets”). The Seller hereby authorizes the
Administrator to file financing statements describing as the collateral covered thereby as “all
assets of the debtor, whether now owned or hereafter created, acquired or arising, and all proceeds
of the foregoing” or words to that effect, notwithstanding that such wording may be broader in
scope than the collateral described in this Agreement. The Administrator, for the benefit of the
Purchasers, shall have, with respect to the Pool Assets, and in addition to all the other rights
and remedies available to the Administrator and the Purchasers, all the rights and remedies of a
secured party under any applicable UCC.

     Notwithstanding the foregoing paragraph of this clause (e), the Seller, the
Administrator, the Purchaser Agents, the Purchasers and all other parties to this Agreement intend
and agree to treat, for U.S. federal, state and local income and franchise tax (in the nature of
income tax)

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purposes only, the sale, assignment and transfer of the Purchased Assets to the
Administrator (on behalf of the Purchasers) as a loan to the Seller secured by the Pool Assets.
The provisions of this Agreement and all related Transaction Documents shall be construed to
further these intentions of the parties.

     (f) LC Participant Investments. Whenever the LC Bank issues a Letter of Credit
pursuant to Section 1.14 hereof, each LC Participant shall, automatically and without
further action of any kind upon the effective date of issuance of such Letter of Credit, have
irrevocably deemed to make an Investment hereunder in the event that such Letter of Credit is
subsequently drawn and such drawn amount shall not have been reimbursed pursuant to Section
1.16 upon such draw. All such Investments shall comprise Base Rate Portions of Capital in an
amount equal to the amount of such draw (without regard to the numerical requirements set forth in
Section 1.2(a)), shall be made ratably by the LC Participants according to their Pro Rata
Shares and shall accrue Discount. In the event that any Letter of Credit expires or is surrendered
without being drawn (in whole or in part) then, in such event, the foregoing commitment to make
Investments shall expire with respect to such Letter of Credit and the LC Participation Amount
shall automatically reduce by the amount of the Letter of Credit which is no longer outstanding.

     (g) Additional Purchasers or Purchaser Groups. The Seller may, with the written
consent of the Administrator (and, in the case of a new LC Participant, the LC Bank), which
consent may be granted or withheld in their sole discretion, add additional Persons as
Purchasers (either to an existing Purchaser Group or by creating new Purchaser Groups) or cause an
existing Related Committed Purchaser or related LC Participant to increase its Commitment in
connection with a corresponding increase in the Purchase Limit; provided, that the
Commitment of any Related Committed Purchaser or related LC Participant may only be increased with
the prior written consent of such Related Committed Purchaser or related LC Participant. Each new
Conduit Purchaser, Related Committed Purchaser or related LC Participant (or Purchaser Group) shall
become a party hereto, by executing and delivering to the Administrator, each Purchaser Agent and
the Seller, an Assumption Agreement in the form of Annex F hereto (which Assumption
Agreement shall, in the case of any new Conduit Purchaser, Related Committed Purchaser or LC
Participant, be executed by each Person in such new Purchaser’s Purchaser Group).

     (h) Nature of Obligations; Defaulting Purchasers. Each Related Committed Purchaser’s
and related LC Participant’s obligations hereunder shall be several, such that the failure of any
Related Committed Purchaser or related LC Participant to make a payment in connection with any
Investment or drawing under a Letter of Credit hereunder, as the case may be, shall not relieve any
other Related Committed Purchaser or related LC Participant of its obligation hereunder to make
payment for any such Investment or drawing. Further, in the event any Related Committed Purchaser
or related LC Participant fails to satisfy its obligation to make an Investment or payment with
respect to such drawing as required hereunder, upon receipt of notice of such failure from the
Administrator (or any relevant Purchaser Agent), subject to the limitations set forth herein, the
non-defaulting Related Committed Purchasers or related LC Participants in such defaulting Related
Committed Purchaser’s or related LC Participant’s Purchaser Group shall fund the defaulting Related
Committed Purchaser’s or related LC Participant’s Commitment Percentage of the related Investment
or drawing pro rata in proportion

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to their relative Commitment Percentages (determined without regard to the Commitment Percentage of the defaulting Related Committed
Purchaser or related LC Participant; it being understood that a defaulting
Related Committed Purchaser’s or related LC Participant’s Commitment Percentage of any such
Investment or drawing shall be first funded by the Related Committed Purchasers or related LC
Participants in such defaulting Related Committed Purchaser’s or related LC Participant’s Purchaser
Group and thereafter if there are no other Related Committed Purchasers or related LC Participants
in such Purchaser Group or if such other Related Committed Purchasers or related LC Participants
are also defaulting Related Committed Purchasers or related LC Participants, then such defaulting
Related Committed Purchaser’s or related LC Participant’s Commitment Percentage of such Investment
or drawing shall be funded by each other Purchaser Group ratably and applied in accordance with
this Section 1.4(h)). Notwithstanding anything in this Section 1.4(h) to the
contrary, no Related Committed Purchaser or related LC Participant shall be required to make any
Investment or payment with respect to such drawing pursuant to this Section 1.4(h) for an
amount which would cause the aggregate Capital of such Related Committed Purchaser or the related
LC Participant’s Pro Rata Share of the LC Participation Amount (after giving effect to such Investment or
payment with respect to such drawing) to exceed its Commitment.

     Section 1.5 Purchased Assets Coverage Percentage Computation.

          The Purchased Assets Coverage Percentage shall be initially computed on the Closing Date.
Thereafter, until the Facility Termination Date, such Purchased Assets Coverage Percentage shall be
automatically recomputed (or deemed to be recomputed) on each Business Day other than a Termination
Day. From and after the occurrence of any Termination Day, the Purchased Assets Coverage
Percentage shall (until the event(s) giving rise to such Termination Day are satisfied or are
waived in accordance with Section 5.1) be deemed to be 100%. The Purchased Assets Coverage
Percentage shall become zero when the Final Payout Date has occurred and the Servicer shall have
received the accrued Servicing Fee thereon.

     Section 1.6 Settlement Procedures.

     (a) The collection of the Pool Receivables shall be administered by the Servicer in accordance
with this Agreement. The Seller shall provide to the Servicer on a timely basis all information
needed for such administration, including notice of the occurrence of any Termination Day and
current computations of the Purchased Assets Coverage Percentage.

     (b) The Servicer shall, on each day on which Collections of Pool Receivables are received (or
deemed received) by the Seller or the Servicer:

     (i) set aside and hold in trust (and shall, at the request of the Administrator,
segregate in a separate account approved by the Administrator) for the benefit of the
Purchasers, out of such Collections, first, an amount equal to the Aggregate
Discount accrued through such day for each Portion of Capital and not previously set aside,
second, an amount equal to the Fees accrued and unpaid through such day, and
third, to the extent funds are available therefor, an amount equal to the Servicing
Fee accrued through such day and not previously set aside,

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     (ii) subject to Section 1.6(f), if such day is not a Termination Day, remit to
the Seller the remainder of such Collections. Such remainder shall, (x) to the extent
representing a return of the Aggregate Capital, be automatically reinvested (ratably among
the Purchasers according to each Purchaser’s Capital) in Pool Receivables, and in the
Related Security, Collections and other proceeds with respect thereto and (y) to the extent
not representing a return of the Aggregate Capital, be paid to the Seller in respect of the
Deferred Purchase Price for the Purchased Assets; provided, however, that if
the Purchased Assets Coverage Percentage would exceed 100%, then the Servicer shall not
reinvest or remit to the Seller, but shall set aside and hold in trust for the benefit of
the Purchasers (and shall, at the request of the Administrator, segregate in a separate
account approved by the Administrator) a portion of such Collections that, together with the
other Collections set aside pursuant to this paragraph, shall equal the amount necessary to
reduce the Purchased Assets Coverage Percentage to 100% (determined as if such Collections
set aside had been applied to reduce the Aggregate Capital at such time), which amount shall
be deposited to the Administration Account (for the benefit of the Purchasers) on the next
Settlement Date in accordance with Section 1.6(c); provided,
further, that (x) in the case of any Purchaser that is a Conduit Purchaser, if such
Purchaser has provided notice (a “Declining Notice”) to its Purchaser Agent, the
Administrator, and the Servicer that such Purchaser (a “Declining Conduit
Purchaser”) no longer wishes Collections with respect to any Portion of Capital funded
or maintained by such Purchaser to be reinvested pursuant to this clause (ii), and
(y) in the case of any Purchaser that has provided notice (an “Exiting Notice”) to
its Purchaser Agent of its refusal, pursuant to Section 1.12, to extend its
Commitment hereunder (an “Exiting Purchaser”) then in either case (x) or (y), above,
such Purchaser’s ratable share (determined according to outstanding Capital) of such
remaining Collections shall not be reinvested or remitted to the Seller and shall instead be
held in trust for the benefit of such Purchaser and applied in accordance with clause
(iii) below,

     (iii) if such day is a Termination Day (or any day following the provision of a
Declining Notice or an Exiting Notice), set aside, segregate and hold in trust (and shall,
at the request of the Administrator, segregate in a separate account approved by the
Administrator) for the benefit of the Purchasers the entire remainder of such Collections
(or in the case of a Declining Conduit Purchaser or an Exiting Purchaser an amount equal to
such Purchaser’s ratable share (determined according to outstanding Capital) of such
Collections; provided, that solely for the purpose of determining such Purchaser’s
ratable share of such Collections, such Purchaser’s Capital shall be deemed to remain
constant from the date of the provision of a Declining Notice or an Exiting Notice, as the
case may be, until the date such Purchaser’s Capital has been paid in full; it
being understood that if such day is also a Termination Day, such Declining
Conduit Purchaser’s or Exiting Purchaser’s Capital shall be recalculated taking into account
amounts received by such Purchaser in respect of this parenthetical and thereafter
Collections shall be set aside for such Purchaser ratably in respect of its Capital (as
recalculated)); provided, further, that if amounts are set aside and held in
trust on any Termination Day of the type described in clause (a) of the definition
of “Termination Day” (or any day following the provision of a Declining Notice or an Exiting
Notice) and, thereafter, the conditions set forth in Section 2 of Exhibit II
are satisfied or waived by the Administrator and the Majority Purchaser

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Agents (or in the case of a Declining Notice or an Exiting Notice, such Declining Notice or Exiting Notice, as
the case may be, has been revoked by the related Declining Conduit Purchaser or Exiting
Purchaser, respectively and written notice thereof has been provided to the Administrator,
the related Purchaser Agent and the Servicer), such previously set-aside amounts shall, to
the extent representing a return of Aggregate Capital (or the Capital of the Declining
Conduit Purchaser or Exiting Purchaser, as the case may be) and ratably (determined
according to outstanding Capital), be reinvested and/or paid to the
Seller in respect of the Deferred Purchase Price for the Purchased Assets in accordance
with clause (ii) above on the day of such subsequent satisfaction or waiver of
conditions or revocation of Declining Notice or Exiting Notice, as the case may be, and

     (iv) subject to Section 1.6(f), pay to the Seller (on behalf of the
Administrator and the Purchasers) for the Seller’s own account and in payment of the
Deferred Purchase Price for the Purchased Assets any Collections in excess of: (x) amounts
required to be reinvested in accordance with clause (ii) above or the last proviso
to clause (iii) above, plus (y) the amounts that are required to be set
aside pursuant to clause (i) above, the provisos to clause (ii) and
clause (iii) above, plus (z) all reasonable and appropriate out-of-pocket
costs and expenses of the Servicer for servicing, collecting and administering the Pool
Receivables.

     (c) The Servicer shall, in accordance with the priorities set forth in Section 1.6(d),
deposit into the Administration Account (or such other account designated by the Administrator), on
each Settlement Date (or, solely with respect to Collections held for the Purchasers pursuant to
Section 1.6(f)(iii), such other date approved by the Administrator with at least five (5)
Business Days prior written notice to the Administrator of such payment), Collections held for the
Purchasers pursuant to Section 1.6(b)(i) or 1.6(f) plus the amount of Collections
then held for the Purchasers pursuant to clauses (b)(ii) and (iii) of Section
1.6; provided, that if Peabody or an Affiliate thereof is the Servicer, such day is not
a Termination Day and the Administrator has not notified Peabody (or such Affiliate) that the right
to retain the portion of Collections set aside pursuant to Section 1.6(b)(i) that
represents the Servicing Fee is revoked, Peabody (or such Affiliate) may retain the portion of the
Collections set aside pursuant to Section 1.6(b)(i) that represents the Servicing Fee in
payment in full of the accrued Servicing Fees so set aside. On the last day of each Settlement
Period, the Administrator will notify the Servicer by facsimile of the amount of Discount accrued
with respect to each Portion of Capital during such Settlement Period or portion thereof.

     (d) Upon receipt of funds deposited into the Administration Account pursuant to clause
(c) above, the Administrator shall cause such funds to be distributed as follows:

     (i) if such distribution occurs on a day that is not a Termination Day and the
Purchased Assets Coverage Percentage does not exceed 100%, first to the Purchaser
Agents (for the benefit of the Purchasers in their respective Purchaser Groups) in payment
in full of all accrued Discount and Fees with respect to each Portion of Capital, and
second, if the Servicer has set aside amounts in respect of the Servicing Fee
pursuant to clause (b)(i) above and has not retained such amounts pursuant to
clause (c) above, to

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the Servicer (payable in arrears on each Settlement Date) in
payment in full of the accrued Servicing Fees so set aside, and

     (ii) if such distribution occurs on a Termination Day or on a day when the Purchased
Assets Coverage Percentage exceeds 100%, first to the Purchaser Agents (for
the benefit of the Purchasers in their respective Purchaser Groups) in payment in full
of all accrued Discount and Fees with respect to each Portion of Capital, second to
the Purchaser Agents (for the benefit of the Purchasers in their respective Purchaser
Groups) in payment in full of Capital (or, if such day is not a Termination Day, the amount
necessary to reduce the Purchased Assets Coverage Percentage to 100%) (determined as if such
Collections had been applied to reduce the aggregate outstanding Capital), third, to
the LC Collateral Account for the benefit of the LC Bank and the LC Participants, the amount
(if any) necessary to cause the amount of cash collateral held in the LC Collateral Account
to equal the aggregate outstanding amount of the LC Participation Amount (or, if such day is
not a Termination Day, the amount necessary to reduce the Purchased Assets Coverage
Percentage to 100%) (determined as if such Collections had been applied to reduce the
aggregate outstanding amount of the LC Participation Amount), fourth, to the
Servicer in payment in full of all accrued Servicing Fees, fifth, if the Capital and
accrued Discount with respect to each Portion of Capital have been reduced to zero, and all
accrued Servicing Fees payable to the Servicer have been paid in full, to the Purchaser
Agents (for the benefit of such Purchaser Agent and the Purchasers in their respective
Purchaser Groups), the Administrator and any other Indemnified Party or Affected Person in
payment in full of any other amounts owed thereto by the Seller hereunder, and
sixth, after the occurrence of the Final Payout Date, all additional Collections
with respect to the Purchased Assets shall be paid to the Seller for its own account in
payment of the Deferred Purchase Price for such Purchased Assets.

     (e) For the purposes of this Section 1.6:

     (i) if on any day the Outstanding Balance of any Pool Receivable is reduced or adjusted
as a result of any defective, rejected, returned, repossessed or foreclosed goods or
services, or any revision, cancellation, allowance, rebate, discount or other adjustment
made by the Seller or any Affiliate of the Seller, or any setoff or dispute between the
Seller or any Affiliate of the Seller and an Obligor, the Seller shall be deemed to have
received on such day a Collection of such Pool Receivable in the amount of such reduction or
adjustment;

     (ii) if on any day any of the representations or warranties in Section l(g) or
(n) of Exhibit III is not true with respect to any Pool Receivable, the
Seller shall be deemed to have received on such day a Collection of such Pool Receivable in
full;

     (iii) except as provided in clause (i) or (ii) above, or as otherwise
required by applicable law or the relevant Contract, all Collections received from an
Obligor of any Receivable shall be applied to the Receivables of such Obligor in the order
of the age of such Receivables, starting with the oldest such Receivable, unless such
Obligor designates in writing its payment for application to specific Receivables; and

12

 

     (iv) if and to the extent the Administrator, any Purchaser Agent or any Purchaser shall
be required for any reason to pay over to an Obligor (or any trustee, receiver, custodian or
similar official in any Insolvency Proceeding) any amount received by it hereunder, such
amount shall be deemed not to have been so received by the Administrator, such Purchaser
Agent or such Purchaser but rather to have been retained by the Seller and, accordingly, the
Administrator, such Purchaser Agent or such Purchaser, as the case may be, shall have a
claim against the Seller for such amount, payable when and to the extent that any
distribution from or on behalf of such Obligor is made in respect thereof.

     (f) If at any time the Seller shall wish to cause the reduction of Aggregate Capital (but not
to commence the liquidation, or reduction to zero, of the entire Aggregate Capital), the Seller may
do so as follows:

     (i) the Seller shall give the Administrator, each Purchaser Agent and the Servicer
written notice in the form of Annex C (the “Paydown Notice”) (A) at least
two Business Days’ prior to the date of such reduction for any reduction of Aggregate
Capital less than or equal to $20,000,000 and (B) at least five Business Days’ prior to the
date of such reduction for any reduction of Aggregate Capital greater than $20,000,000, in
each case such notice shall include the amount of such reduction and the proposed date on
which such reduction shall commence;

     (ii) on the proposed date of the commencement of such reduction and on each day
thereafter, the Servicer shall cause Collections not to be reinvested until the amount
thereof not so reinvested shall equal the desired amount of reduction; and

     (iii) the Servicer shall hold such Collections in trust for the benefit of the
Administrator (for the benefit of each Purchaser), for payment to the Administrator by
deposit into the Administration Account on the next Settlement Date immediately following
the current Settlement Period or such other date approved by the Administrator and the
Majority Purchaser Agents, and Capital shall be deemed reduced in the amount to be paid to
the Administrator only when in fact finally so paid;

provided, that the amount of any such reduction shall be not less than $300,000 and shall
be an integral multiple of $100,000. Upon receipt by the Administrator in the Administration
Account of any amount paid in reduction of the Aggregate Capital pursuant to sub-clause
(iii) above, the Administrator shall cause such funds to be distributed to the Purchaser Agents
(for the benefit of the Purchasers in their respective Purchaser Groups) in payment of each
Purchaser’s outstanding Capital.

     Section 1.7 Fees.

          The Seller shall pay to the Administrator, the Purchasers and the Purchaser Agents the fees in
the amounts and on the dates set forth in those certain fee letter agreements for each Purchaser
Group, in each case, from time to time entered into among Peabody, the Seller

13

 

and the applicable Purchaser Agent and/or the Administrator (as such letter agreements may be
amended, supplemented or otherwise modified from time to time, the “Fee Letters”).

     Section 1.8 Payments and Computations, Etc.

     (a) All amounts to be paid or deposited by the Seller or the Servicer hereunder shall be made
without reduction for offset or counterclaim and shall be paid or deposited no later than noon (New
York City time) on the day when due in same day funds to the Administration Account. All amounts
received after noon (New York City time) will be deemed to have been received on the next Business
Day. Amounts payable hereunder to or for the benefit of the Administrator, the Purchasers or the
Purchaser Agents (or their related Affected Persons or Indemnified Parties) shall be distributed as
follows:

     (i) Any amounts to be distributed by or on behalf of the Administrator hereunder to any
Purchaser Agent, Purchaser or Purchaser Group shall be distributed to the account specified
in writing from time to time by the applicable Purchaser Agent to the Administrator, and the
Administrator shall have no obligation to distribute any such amounts unless and until it
actually receives payment of such amounts by the Seller or the Servicer, as applicable, in
the Administration Account. Except as expressly set forth herein (including, without
limitation, as set forth in Section 1.6(b)(iii) with respect to Collections held in
trust for Declining Conduit Purchasers and Exiting Purchasers), the Administrator shall
distribute (or cause to be distributed) such amounts to the Purchaser Agents for the
Purchasers within their respective Purchaser Groups ratably (x) in the case of such amounts
paid in respect of Discount and Fees, according to the Discount and Fees payable to the
Purchasers and (y) in the case of such amounts paid in respect of Capital (or in respect of
any other obligations other than Discount and Fees), according to the outstanding Capital
funded by the Purchasers.

     (ii) Except as expressly set forth herein (including, without limitation, as set forth
in Section 1.6(b)(iii) with respect to Collections held in trust for Declining
Conduit Purchasers and Exiting Purchasers), each Purchaser Agent shall distribute the
amounts paid to it hereunder for the benefit of the Purchasers in its Purchaser Group to the
Purchasers within its Purchaser Group ratably (x) in the case of such amounts paid in
respect of Discount and Fees, according to the Discount and Fees payable to such Purchasers
and (y) in the case of such amounts paid in respect of Capital (or in respect of any other
obligations other than Discount and Fees), according to the outstanding Capital funded by
such Purchasers.

     (b) The Seller or the Servicer, as the case may be, shall, to the extent permitted by law, pay
interest on any amount not paid or deposited by the Seller or the Servicer, as the case may be,
when due hereunder, at an interest rate equal to 2.0% per annum above the Base Rate, payable on
demand.

     (c) All computations of interest under clause (b) above and all computations of
Discount, fees and other amounts hereunder shall be made on the basis of a year of 360 (or 365 or
366, as applicable, with respect to Discount or other amounts calculated by reference to the

14

 

Base Rate) days for the actual number of days elapsed. Whenever any payment or deposit to be
made hereunder shall be due on a day other than a Business Day, such payment or deposit shall be
made on the next Business Day and such extension of time shall be included in the computation of
such payment or deposit.

     Section 1.9 Increased Costs.

     (a) If the Administrator, the LC Bank, any Purchaser Agent, any Purchaser, any Liquidity Bank,
any other Program Support Provider or any of their respective Affiliates (each an “Affected
Person”) reasonably determines that the existence of or compliance with: (i) any law or
regulation or any change therein or in the interpretation or application thereof, in each case
adopted, issued or occurring after the date hereof, or (ii) any request, guideline or directive
from any central bank or other Governmental Authority (whether or not having the force of law)
issued or occurring after the date of this Agreement, affects or would affect the amount of capital
required or expected to be maintained by such Affected Person, and such Affected Person determines
that the amount of such capital is increased by or based upon the existence of any commitment to
make Investments in (or otherwise to maintain the Investments in) Pool Receivables or issue any
Letter of Credit related to this Agreement or any related liquidity facility, credit enhancement
facility and other commitments of the same type, then, upon demand by such Affected Person (with a
copy to the Administrator), the Seller shall promptly pay to the Administrator, for the account of
such Affected Person, from time to time as specified by such Affected Person, additional amounts
sufficient to compensate such Affected Person in the light of such circumstances, to the extent
that such Affected Person reasonably determines such increase in capital to be allocable to the
existence of any of such commitments. A certificate as to such amounts submitted to the Seller and
the Administrator by such Affected Person shall be conclusive and binding for all purposes, absent
manifest error.

     (b) If, due to either: (i) the introduction of or any change in or in the interpretation of
any law or regulation or (ii) compliance with any guideline or request from any central bank or
other Governmental Authority (whether or not having the force of law), there shall be any increase
in the cost to any Affected Person of agreeing to purchase or purchasing, or maintaining the
ownership of, the Purchased Assets in respect of which Discount is computed by reference to the
Euro-Rate, then, upon demand by such Affected Person, the Seller shall promptly pay to such
Affected Person, from time to time as specified by such Affected Person, additional amounts
sufficient to compensate such Affected Person for such increased costs. A certificate as to such
amounts submitted to the Seller and the Administrator by such Affected Person shall be conclusive
and binding for all purposes, absent manifest error.

     (c) If such increased costs affect the related Affected Person’s portfolio of financing
transactions, such Affected Person shall use reasonable averaging and attribution methods to
allocate such increased costs to the transactions contemplated by this Agreement.

     Section 1.10 Requirements of Law.

          If any Affected Person reasonably determines that the existence of or compliance with: (a)
any law or regulation or any change therein or in the interpretation or application

15

 

thereof, in each case adopted, issued or occurring after the date hereof, or (b) any request,
guideline or directive from any central bank or other Governmental Authority (whether or not having
the force of law) issued or occurring after the date of this Agreement:

     (i) does or shall subject such Affected Person to any tax of any kind whatsoever with
respect to this Agreement, any purchase of or investment in the Purchased Assets or any
increase in the amount of Capital relating thereto, or does or shall change the basis of
taxation of payments to such Affected Person on account of Collections, Discount or any
other amounts payable hereunder (excluding taxes imposed on the overall or branch pre-tax
net income of such Affected Person, and franchise taxes imposed on such Affected Person, by
the jurisdiction under the laws of which such Affected Person is organized or otherwise is
considered doing business (unless the Affected Person would not be considered doing business
in such jurisdiction, but for having entered into, or engaged in the transactions in
connection with, this Agreement or any other Transaction Document) or a political
subdivision thereof),

     (ii) does or shall impose, modify or hold applicable any reserve, special deposit,
compulsory loan or similar requirement against assets held by, or deposits or other
liabilities in or for the account of, purchases, advances or loans by, or other credit
extended by, or any other acquisition of funds by, any office of such Affected Person that
are not otherwise included in the determination of the Euro-Rate or the Base Rate hereunder,
or

     (iii) does or shall impose on such Affected Person any other condition, and the result
of any of the foregoing is: (A) to increase the cost to such Affected Person of agreeing to
purchase or purchasing or maintaining the ownership of, or issuing any Letter of Credit in
respect of, the Purchased Assets (or interests therein) or any Portion of Capital, or (B) to
reduce any amount receivable hereunder (whether directly or indirectly);

then, in any such case, upon demand by such Affected Person, the Seller shall promptly pay
to such Affected Person additional amounts necessary to compensate such Affected Person for
such additional cost or reduced amount receivable. All such amounts shall be payable as
incurred. A certificate from such Affected Person to the Seller and the Administrator
certifying, in reasonably specific detail, the basis for, calculation of, and amount of such
additional costs or reduced amount receivable shall be conclusive and binding for all
purposes, absent manifest error; provided, however, that no Affected Person
shall be required to disclose any confidential or tax planning information in any such
certificate.

     Section 1.11 Inability to Determine Euro-Rate.

     (a) If the Administrator (or any Purchaser Agent) determines before the first day of any
Settlement Period (which determination shall be final and conclusive) that, by reason of
circumstances affecting the interbank eurodollar market generally, deposits in dollars (in the
relevant amounts for such Settlement Period) are not being offered to banks in the interbank

16

 

eurodollar market for such Settlement Period, or adequate means do not exist for ascertaining
the Euro-Rate for such Settlement Period, then the Administrator or such Purchaser Agent, as
applicable, shall give notice thereof to the Seller. Thereafter, until the Administrator or such
Purchaser Agent notifies the Seller that the circumstances giving rise to such suspension no longer
exist, (i) no Portion of Capital shall be funded at the Alternate Rate determined by reference to
the Euro-Rate and (ii) the Discount for any outstanding Portions of Capital then funded at the
Alternate Rate determined by reference to the Euro-Rate shall, on the last day of the then current
Settlement Period, be converted to the Alternate Rate determined by reference to the Base Rate.

     (b) If, on or before the first day of any Settlement Period, the Administrator shall have been
notified by any Affected Person that, such Affected Person has determined (which determination
shall be final and conclusive) that, any enactment, promulgation or adoption of or any change in
any applicable law, rule or regulation, or any change in the interpretation or administration
thereof by a governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by such Affected Person with any guideline,
request or directive (whether or not having the force of law) of any such authority, central bank
or comparable agency shall make it unlawful or impossible for such Affected Person to fund or
maintain any Portion of Capital at the Alternate Rate and based upon the Euro-Rate, the
Administrator shall notify the Seller thereof. Upon receipt of such notice, until the
Administrator notifies the Seller that the circumstances giving rise to such determination no
longer apply, (i) no Portion of Capital shall be funded at the Alternate Rate determined by
reference to the Euro-Rate and (ii) the Discount for any outstanding Portions of Capital then
funded at the Alternate Rate determined by reference to the Euro-Rate shall be converted to the
Alternate Rate determined by reference to the Base Rate either (A) on the last day of the then
current Settlement Period if such Affected Person may lawfully continue to maintain such Portion of
Capital at the Alternate Rate determined by reference to the Euro-Rate to such day, or (B)
immediately, if such Affected Person may not lawfully continue to maintain such Portion of Capital
at the Alternate Rate determined by reference to the Euro-Rate to such day.

     Section 1.12 Extension of the Facility Termination Date.

          Provided that no Termination Event or Unmatured Termination Event exists and is continuing,
the Seller may request the extension of the Facility Termination Date set forth in clause
(a) of the definition thereof or determined pursuant to clause (d) of the definition
thereof, in either case, by providing written notice to the Administrator and each Purchaser Agent;
provided such request is made not more than 120 days prior to, and not less than 60 days
prior to, the then current Facility Termination Date; and provided, further, that
no extension of the Facility Termination Date determined pursuant to clause (d) of the
definition thereof with respect to any Purchaser Group shall be for period of more than 364 days
after the then scheduled date on which the Facility Termination Date will occur with respect to
such Purchaser Group pursuant to such clause (d). In the event that the Purchasers are all
agreeable to such extension, the Administrator shall so notify the Seller and the Servicer in
writing (it being understood that the Purchasers may accept or decline such a request in
their sole discretion and on such terms as they may elect) not less than 30 days prior to the then
current Facility Termination Date and the Seller, the Servicer, the Sub-Servicers, the
Administrator, the Purchaser Agents and the

17

 

Purchasers shall enter into such documents as the Administrator, the Purchaser Agents and the
Purchasers may deem necessary or appropriate to reflect such extension, and all reasonable costs
and expenses incurred by the Purchasers, the Purchaser Agents and the Administrator in connection
therewith (including reasonable Attorney Costs) shall be paid by the Seller. In the event any
Purchaser declines the request for such extension, such Purchaser (or its Purchaser Agent) shall so
notify the Administrator and the Administrator shall so notify the Seller of such determination;
provided, that the failure of the Administrator to notify the Seller of the determination
to decline such extension shall not affect the understanding and agreement that the applicable
Purchasers shall be deemed to have refused to grant the requested extension in the event the
Administrator fails to affirmatively notify the Seller, in writing, of their agreement to accept
the requested extension. If the Facility Termination Date is extended with respect to one or more,
but less than all Purchasers, then the Purchase Limit shall be reduced ratably with respect to the
Purchasers in each Purchaser Group by an amount equal to the Commitment(s) of the Exiting
Purchaser(s) and the Commitment Percentages and Group Commitments of the Purchasers within each
Purchaser Group shall be appropriately adjusted.

     Section 1.13 Letters of Credit.

          Subject to the terms and conditions hereof, the LC Bank shall issue or cause the issuance of
standby Letters of Credit (“Letters of Credit”) on behalf of the Seller (and, if
applicable, on behalf of, or for the account of, the Servicer or any Sub-Servicer);
provided, however, that the LC Bank will not be required to issue or cause to be
issued any Letters of Credit to the extent that the issuance of such Letters of Credit would then
cause (a) the sum of (i) the Aggregate Capital plus (ii) the LC Participation Amount to exceed the
Purchase Limit or (b) the LC Participation Amount to exceed the aggregate of the Commitments of the
LC Bank and the LC Participants. All amounts drawn upon Letters of Credit shall accrue Discount.
Letters of Credit that have not been drawn upon shall not accrue Discount.

     Section 1.14 Issuance of Letters of Credit.

     (a) The Seller may request the LC Bank, upon two (2) Business Days’ prior written notice
submitted on or before 11:00 a.m., New York time, to issue a Letter of Credit by delivering to the
Administrator an Investment Notice substantially in the form of Annex B attached hereto and
the LC Bank’s form of Letter of Credit Application (the “Letter of Credit Application”),
substantially in the form of Annex E attached hereto completed to the satisfaction of the
Administrator and the LC Bank; and, such other certificates, documents and other papers and
information as the Administrator may reasonably request. The Seller also has the right to give
instructions and make agreements with respect to any Letter of Credit Application and the
disposition of documents, and to agree with the Administrator upon any amendment, extension or
renewal of any Letter of Credit.

     (b) Each Letter of Credit shall, among other things, (i) provide for the payment of sight
drafts or other written demands for payment when presented for honor thereunder in accordance with
the terms thereof and when accompanied by the documents described therein and (ii) have an expiry
date not later than twelve (12) months after such Letter of Credit’s date of issuance, extension or
renewal, as the case may be, and in no event later than twelve (12) months

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after the Facility Termination Date. Each Letter of Credit shall be subject either to the
Uniform Customs and Practice for Documentary Credits (2007 Revision), International Chamber of
Commerce Publication No. 600, and any amendments or revisions thereof adhered to by the LC Bank
(“UCP 600”) or the International Standby Practices (ISP98-International Chamber of Commerce
Publication Number 590), and any amendments or revisions thereof adhered to by the LC Bank (the
“ISP98 Rules”), as determined by the LC Bank.

     (c) The Administrator shall promptly notify the LC Bank and the LC Participants, at such
Person’s address for notices hereunder, of the request by the Seller for a Letter of Credit
hereunder, and shall provide the LC Bank and the LC Participants with the Letter of Credit
Application delivered to the Administrator by the Seller pursuant to paragraph (a), above,
by the close of business on the day received or if received on a day that is not a Business Day or
on any Business Day after 11:00 a.m. New York time on such day, on the next Business Day.

     Section 1.15 Requirements For Issuance of Letters of Credit.

     The Seller shall authorize and direct the LC Bank to name the Seller as the “Applicant” or
“Account Party” of each Letter of Credit.

     Section 1.16 Disbursements, Reimbursement.

     (a) Immediately upon the issuance of each Letter of Credit, each LC Participant shall be
deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the LC Bank a
participation in such Letter of Credit and each drawing thereunder in an amount equal to such LC
Participant’s Pro Rata Share of the face amount of such Letter of Credit and the amount of such
drawing, respectively.

     (b) In the event of any request for a drawing under a Letter of Credit by the beneficiary or
transferee thereof, the LC Bank will promptly notify the Administrator and the Seller of such
request. Provided that it shall have received such notice, the Seller shall reimburse (such
obligation to reimburse the LC Bank shall sometimes be referred to as a “Reimbursement
Obligation”) the LC Bank prior to 12:00 p.m., New York time on each date that an amount is paid
by the LC Bank under any Letter of Credit (each such date, a “Drawing Date”) in an amount
equal to the amount so paid by the LC Bank. In the event the Seller fails to reimburse the LC Bank
for the full amount of any drawing under any Letter of Credit by 12:00 p.m., New York time, on the
Drawing Date, the LC Bank will promptly notify each LC Participant thereof, and the Seller shall be
deemed to have requested that an Investment be made by the Purchasers in the Purchaser Groups for
the LC Bank and the LC Participants to be disbursed on the Drawing Date under such Letter of Credit
in accordance with Section 1.1(b), subject to the amount of the unutilized portion of the
Purchase Limit. Any notice given by the LC Bank pursuant to this Section may be oral if
immediately confirmed in writing; provided that the lack of such an immediate confirmation
shall not affect the conclusiveness or binding effect of such oral notice.

     (c) Each LC Participant shall upon any notice pursuant to clause (b) above make
available to the LC Bank an amount in immediately available funds equal to its Pro Rata Share of
the amount of the drawing, whereupon the LC Participants shall each be deemed to have

19

 

made an Investment in that amount. If any LC Participant so notified fails to make available
to the LC Bank the amount of such LC Participant’s Pro Rata Share of such amount by no later than
2:00 p.m., New York time on the Drawing Date, then interest shall accrue on such LC Participant’s
obligation to make such payment, from the Drawing Date to the date on which such LC Participant
makes such payment (i) at a rate per annum equal to the Federal Funds Rate during the first three
days following the Drawing Date and (ii) at a rate per annum equal to the rate applicable to
Capital on and after the fourth day following the Drawing Date. The LC Bank will promptly give
notice of the occurrence of the Drawing Date, but failure of the LC Bank to give any such notice on
the Drawing Date or in sufficient time to enable any LC Participant to effect such payment on such
date shall not relieve such LC Participant from its obligation under this clause (c),
provided that such LC Participant shall not be obligated to pay interest as provided in
subclauses (i) and (ii) above until and commencing from the date of receipt of
notice from the LC Bank or the Administrator of a drawing. Each LC Participant’s Commitment shall
continue until the last to occur of any of the following events: (A) the LC Bank ceases to be
obligated to issue or cause to be issued Letters of Credit hereunder; (B) no Letter of Credit
issued hereunder remains outstanding and uncancelled or (C) all Persons (other than the Seller)
have been fully reimbursed for all payments made under or relating to Letters of Credit.

     Section 1.17 Repayment of Participation Advances.

     (a) Upon (and only upon) receipt by the LC Bank for its account of immediately available funds
from the Seller (i) in reimbursement of any payment made by the LC Bank under a Letter of Credit
with respect to which any LC Participant has made a participation advance to the LC Bank, or (ii)
in payment of Discount on the Investments made or deemed to have been made in connection with any
such draw, the LC Bank will pay to each LC Participant, ratably (based on the outstanding drawn
amounts funded by each such LC Participant in respect of such Letter of Credit), in the same funds
as those received by the LC Bank; it being understood, that the LC Bank
shall retain a ratable amount of such funds that were not the subject of any payment in respect of
such Letter of Credit by any LC Participant.

     (b) If the LC Bank is required at any time to return to the Seller, or to a trustee, receiver,
liquidator, custodian, or any official in any insolvency proceeding, any portion of the payments
made by the Seller to the LC Bank pursuant to this Agreement in reimbursement of a payment made
under the Letter of Credit or interest or fee thereon, each LC Participant shall, on demand of the
LC Bank, forthwith return to the LC Bank the amount of its Pro Rata Share of any amounts so
returned by the LC Bank plus interest at the Federal Funds Rate from the date the payment was first
made to such LC Participant through, but not including, the date the payment is returned by such LC
Participant.

     Section 1.18 Documentation.

          The Seller agrees to be bound by the terms of the Letter of Credit Application and by the LC
Bank’s interpretations of any Letter of Credit issued for the Seller and by the LC Bank’s written
regulations and customary practices relating to letters of credit, though the LC Bank’s
interpretation of such regulations and practices may be different from the Seller’s own. In the
event of a conflict between the Letter of Credit Application and this Agreement, this

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Agreement shall govern. It is understood and agreed that, except in the case of gross
negligence or willful misconduct by the LC Bank, the LC Bank shall not be liable for any error,
negligence and/or mistakes, whether of omission or commission, in following the Seller’s
instructions or those contained in the Letters of Credit or any modifications, amendments or
supplements thereto.

     Section 1.19 Determination to Honor Drawing Request.

          In determining whether to honor any request for drawing under any Letter of Credit by the
beneficiary thereof, the LC Bank shall be responsible only to determine that the documents and
certificates required to be delivered under such Letter of Credit have been delivered and that they
comply on their face with the requirements of such Letter of Credit and that any other drawing
condition appearing on the face of such Letter of Credit has been satisfied in the manner so set
forth.

     Section 1.20 Nature of Participation and Reimbursement Obligations.

          Each LC Participant’s obligation in accordance with this Agreement to make participation
advances as a result of a drawing under a Letter of Credit, and the obligations of the Seller to
reimburse the LC Bank upon a draw under a Letter of Credit, shall be absolute, unconditional and
irrevocable, and shall be performed strictly in accordance with the terms of this Article I
under all circumstances, including the following circumstances:

     (i) any set-off, counterclaim, recoupment, defense or other right which such LC
Participant may have against the LC Bank, the Administrator, any Purchaser Agent, any
Purchaser, the Seller or any other Person for any reason whatsoever;

     (ii) the failure of the Seller or any other Person to comply with the conditions set
forth in this Agreement for the making of an Investment, Reinvestments, requests for Letters
of Credit or otherwise, it being acknowledged that such conditions are not required for the
making of participation advances hereunder;

     (iii) any lack of validity or enforceability of any Letter of Credit;

     (iv) any claim of breach of warranty that might be made by the Seller, the LC Bank or
any LC Participant against the beneficiary of a Letter of Credit, or the existence of any
claim, set-off, defense or other right which the Seller, the LC Bank or any LC Participant
may have at any time against a beneficiary, any successor beneficiary or any transferee of
any Letter of Credit or the proceeds thereof (or any Persons for whom any such transferee
may be acting), the LC Bank, any LC Participant, any Purchaser Agent, any Purchaser or any
other Person, whether in connection with this Agreement, the transactions contemplated
herein or any unrelated transaction (including any underlying transaction between the Seller
or any Subsidiaries of the Seller or any Affiliates of the Seller and the beneficiary for
which any Letter of Credit was procured);

     (v) the lack of power or authority of any signer of, or lack of validity, sufficiency,
accuracy, enforceability or genuineness of, any draft, demand, instrument,

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certificate or other document presented under any Letter of Credit, or any such draft,
demand, instrument, certificate or other document proving to be forged, fraudulent, invalid,
defective or insufficient in any respect or any statement therein being untrue or inaccurate
in any respect, even if the Administrator or the LC Bank has been notified thereof;

     (vi) payment by the LC Bank under any Letter of Credit against presentation of a
demand, draft or certificate or other document which does not comply with the terms of such
Letter of Credit other than as a result of the gross negligence or willful misconduct of the
LC Bank;

     (vii) the solvency of, or any acts or omissions by, any beneficiary of any Letter of
Credit, or any other Person having a role in any transaction or obligation relating to a
Letter of Credit, or the existence, nature, quality, quantity, condition, value or other
characteristic of any property or services relating to a Letter of Credit;

     (viii) any failure by the LC Bank or any of the LC Bank’s Affiliates to issue any
Letter of Credit in the form requested by the Seller, unless the LC Bank has received
written notice from the Seller of such failure within three Business Days after the LC Bank
shall have furnished the Seller a copy of such Letter of Credit and such error is material
and no drawing has been made thereon prior to receipt of such notice;

     (ix) any Material Adverse Effect on the Seller, any Originator or any Affiliates
thereof;

     (x) any breach of this Agreement or any Transaction Document by any party thereto;

     (xi) the occurrence or continuance of an Insolvency Proceeding with respect to the
Seller, any Originator or any Affiliate thereof;

     (xii) the fact that a Termination Event or an Unmatured Termination Event shall have
occurred and be continuing;

     (xiii) the fact that this Agreement or the obligations of Seller or Servicer hereunder
shall have been terminated; and

     (xiv) any other circumstance or happening whatsoever, whether or not similar to any of
the foregoing.

     Nothing in this Section 1.20 shall relieve the LC Bank from liability for its gross
negligence or willful misconduct, as determined by a final non-appealable judgment of a court of
competent jurisdiction.

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     Section 1.21 Indemnity.

          In addition to other amounts payable hereunder, the Seller hereby agrees to protect,
indemnify, pay and save harmless the Administrator, the LC Bank, each LC Participant and any of the
LC Bank’s Affiliates that have issued a Letter of Credit from and against any and all claims,
demands, liabilities, damages, taxes, penalties, interest, judgments, losses, costs, charges and
expenses (including Attorney Costs) which the Administrator, the LC Bank, any LC Participant or any
of their respective Affiliates may incur or be subject to as a consequence, direct or indirect, of
the issuance of any Letter of Credit, other than as a result of (a) the gross negligence or willful
misconduct of the party to be indemnified as determined by a final judgment of a court of competent
jurisdiction or (b) the wrongful dishonor by the LC Bank of a proper demand for payment made under
any Letter of Credit, except if such dishonor resulted from any act or omission, whether rightful
or wrongful, of any present or future de jure or de facto Governmental Authority (all such acts or
omissions herein called “Governmental Acts”).

     Section 1.22 Liability for Acts and Omissions.

          As between the Seller, on the one hand, and the Administrator, the LC Bank, the LC
Participants, the Purchaser Agents and the Purchasers, on the other, the Seller assumes all risks
of the acts and omissions of, or misuse of the Letters of Credit by, the respective beneficiaries
of such Letters of Credit. In furtherance and not in limitation of the respective foregoing, none
of the Administrator, the LC Bank, the LC Participants, the Purchaser Agents or the Purchasers
shall be responsible for: (i) the form, validity, sufficiency, accuracy, genuineness or legal
effect of any document submitted by any party in connection with the application for an issuance of
any such Letter of Credit, even if it should in fact prove to be in any or all respects invalid,
insufficient, inaccurate, fraudulent or forged (even if the LC Bank shall have been notified
thereof); (ii) the validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign any such Letter of Credit or the rights or benefits thereunder or
proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason;
(iii) the failure of the beneficiary of any such Letter of Credit, or any other party to which such
Letter of Credit may be transferred, to comply fully with any conditions required in order to draw
upon such Letter of Credit or any other claim of the Seller against any beneficiary of such Letter
of Credit, or any such transferee, or any dispute between or among the Seller and any beneficiary
of any Letter of Credit or any such transferee; (iv) errors, omissions, interruptions or delays in
transmission or delivery of any messages, by mail, cable, telegraph, telex or otherwise, whether or
not they be in cipher; (v) errors in interpretation of technical terms; (vi) any loss or delay in
the transmission or otherwise of any document required in order to make a drawing under any such
Letter of Credit or of the proceeds thereof; (vii) the misapplication by the beneficiary of any
such Letter of Credit of the proceeds of any drawing under such Letter of Credit; or (viii) any
consequences arising from causes beyond the control of the Administrator, the LC Bank, the LC
Participants, the Purchaser Agents and the Purchasers, including any Governmental Acts, and none of
the above shall affect or impair, or prevent the vesting of, any of the LC Bank’s rights or powers
hereunder. Nothing in the preceding sentence shall relieve the LC Bank from liability for its gross
negligence or willful misconduct, as determined by a final non-appealable judgment of a

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court of competent jurisdiction, in connection with actions or omissions described in such clauses (i)
through (viii) of such sentence. In no event shall the Administrator, the LC Bank, the LC
Participants, the Purchaser Agents, the Purchasers or their respective Affiliates, be liable to the
Seller or any other Person for any indirect, consequential, incidental, punitive, exemplary or
special damages or expenses (including without limitation attorneys’ fees), or for any damages
resulting from any change in the value of any property relating to a Letter of Credit.

          Without limiting the generality of the foregoing, the Administrator, the LC Bank, the LC
Participants, the Purchaser Agents, the Purchasers and each of their respective Affiliates (i) may
rely on any written communication believed in good faith by such Person to have been authorized or
given by or on behalf of
the applicant for a Letter of Credit; (ii) may honor any presentation if the documents
presented appear on their face to comply with the terms and conditions of the relevant Letter of
Credit; (iii) may honor a previously dishonored presentation under a Letter of Credit, whether such
dishonor was pursuant to a court order, to settle or compromise any claim of wrongful dishonor, or
otherwise, and shall be entitled to reimbursement to the same extent as if such presentation had
initially been honored, together with any interest paid by the LC Bank or its Affiliates; (iv) may
honor any drawing that is payable upon presentation of a statement advising negotiation or payment,
upon receipt of such statement (even if such statement indicates that a draft or other document is
being delivered separately), and shall not be liable for any failure of any such draft or other
document to arrive, or to conform in any way with the relevant Letter of Credit; (v) may pay any
paying or negotiating bank claiming that it rightfully honored under the laws or practices of the
place where such bank is located; and (vi) may settle or adjust any claim or demand made on the
Administrator, the LC Bank, the LC Participants, the Purchaser Agents, the Purchasers or their
respective Affiliates, in any way related to any order issued at the applicant’s request to an air
carrier, a letter of guarantee or of indemnity issued to a carrier or any similar document (each an
“Order”) and honor any drawing in connection with any Letter of Credit that is the subject
of such Order, notwithstanding that any drafts or other documents presented in connection with such
Letter of Credit fail to conform in any way with such Letter of Credit.

          In furtherance and extension and not in limitation of the specific provisions set forth above,
any action taken or omitted by the LC Bank under or in connection with the Letters of Credit issued
by it or any documents and certificates delivered thereunder, if taken or omitted in good faith and
without gross negligence or willful misconduct, as determined by a final non-appealable judgment of
a court of competent jurisdiction, shall not put the LC Bank under any resulting liability to the
Seller, any LC Participant or any other Person.

ARTICLE II.

REPRESENTATIONS AND WARRANTIES; COVENANTS; TERMINATION EVENTS

     Section 2.1 Representations and Warranties; Covenants.

          Each of the Seller, Peabody and the Servicer hereby makes the representations and warranties,
and hereby agrees to perform and observe the covenants, applicable to it set forth in Exhibits
III and IV, respectively.

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     Section 2.2 Termination Events.

          If any of the Termination Events set forth in Exhibit V shall occur, the Administrator
may (with the consent of the Majority Purchasers) or shall (at the direction of the Majority
Purchasers), by notice to the Seller, declare the Facility Termination Date to have occurred (in
which case the Facility Termination Date shall be deemed to have occurred); provided, that
automatically upon the occurrence of any event (without any requirement for the passage of time or
the giving of notice) described in paragraph (f) of Exhibit V, the Facility
Termination Date shall occur. Upon any such declaration, occurrence or deemed occurrence of the
Facility Termination Date, the Administrator, the Purchaser Agents and the Purchasers shall have,
in addition to the rights and remedies that they may have under this Agreement, all other rights
and remedies provided after default under the Illinois UCC and under other applicable law, which
rights and remedies shall be cumulative.

ARTICLE III.

INDEMNIFICATION

     Section 3.1 Indemnities by the Seller.

          Without limiting any other rights that the Administrator, the Purchaser Agents, the
Purchasers, the Liquidity Banks, any Program Support Provider or any of their respective
Affiliates, employees, officers, directors, agents, counsel, successors, transferees or permitted
assigns (each, an “Indemnified Party”) may have hereunder or under applicable law, the
Seller hereby agrees to indemnify each Indemnified Party from and against any and all claims,
damages, expenses, costs, losses and liabilities (including Attorney Costs) (all of the foregoing
being collectively referred to as “Indemnified Amounts”) arising out of or resulting from
this Agreement (whether directly
or indirectly), the use of proceeds of Investments or Reinvestments, the ownership of any
portion of the Purchased Assets, or any interest therein, or in respect of any Receivable, Related
Security or Contract, excluding, however: (a) Indemnified Amounts to the extent resulting from
gross negligence or willful misconduct on the part of such Indemnified Party or its employees,
officers, directors, agents, counsel, successors, transferees or permitted assigns, (b) any
indemnification which has the effect of recourse for the non-payment of the Receivables to any
indemnitor (except as otherwise specifically provided in this Agreement), or (c) overall net income
taxes or franchise taxes imposed on such Indemnified Party by the jurisdiction under the laws of
which such Indemnified Party is organized or any political subdivision thereof. Without limiting
or being limited by the foregoing, and subject to the exclusions set forth in the preceding
sentence, the Seller shall pay on demand (which demand shall be accompanied by documentation of the
Indemnified Amounts, in reasonable detail) to each Indemnified Party any and all amounts necessary
to indemnify such Indemnified Party from and against any and all Indemnified Amounts relating to or
resulting from any of the following:

               (i) the failure of any Receivable included in the calculation of the Net Receivables Pool
Balance as an Eligible Receivable to be an Eligible Receivable, the failure of any information
contained in an Information Package to be true and correct on the date thereof (or, if such
information is stated therein to be as of a different date, on such different date), or the failure
of any other information provided to any Purchaser or the Administrator with respect to

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Receivables or this Agreement to be true and correct on the date so provided (or, if such information is stated
therein to be as of a different date, on such different date),

               (ii) the failure of any representation, warranty or statement made or deemed made by the
Seller (or any of its officers) under or in connection with this Agreement to have been true and
correct as of the date made or deemed made in all respects when made,

               (iii) the failure by the Seller to comply with any applicable law, rule or regulation with
respect to any Pool Receivable or the related Contract, or the failure of any Pool Receivable or
the related Contract to conform to any such applicable law, rule or regulation,

               (iv) the failure to vest in the Administrator (on behalf of the Purchasers) a valid and
enforceable first priority perfected ownership or security interest in the Pool Assets, free and
clear of any Adverse Claim,

               (v) the failure to have filed, or any delay in filing, financing statements or other similar
instruments or documents under the UCC of any applicable jurisdiction or other applicable laws with
respect to any Receivables in, or purporting to be in, the Receivables Pool and the other Pool
Assets, whether at the time of any Investment or Reinvestment or at any subsequent time,

               (vi) any dispute, claim, offset or defense (other than discharge in bankruptcy of the Obligor)
of the Obligor to the payment of any Receivable in, or purporting to be in, the Receivables Pool
(including a defense based on such Receivable or the related Contract not being a legal, valid and
binding obligation of such Obligor enforceable against it in accordance with its terms), or any
other claim resulting from the sale of the goods or services related to such Receivable or the
furnishing or failure to furnish such goods or services or relating to collection activities with
respect to such Receivable (if such collection activities were performed by the Seller or any of
its Affiliates acting as Servicer or by any agent or independent contractor retained by the Seller
or any of its Affiliates),

               (vii) any failure of the Seller (or any of its Affiliates acting as the Servicer) to perform
its duties or obligations in accordance with the provisions hereof or under the Contracts,

               (viii) any products liability or other claim, investigation, litigation or proceeding arising
out of or in connection with merchandise, insurance or services that are the subject of any
Contract,

               (ix) the commingling of Collections at any time with other funds,

               (x) the use of proceeds of Investments or Reinvestments, or

               (xi) any reduction in Capital as a result of the distribution of Collections pursuant to
Section 1.6(d), if all or a portion of such distributions shall thereafter be rescinded or
otherwise must be returned for any reason.

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     Section 3.2 Indemnities by the Servicer.

          Without limiting any other rights that any Indemnified Party may have hereunder or under
applicable law, the Servicer hereby agrees to indemnify each Indemnified Party from and against any
and all Indemnified Amounts arising out of or resulting from (whether directly or indirectly): (a)
the failure of any information contained in an Information Package to be true and correct on the
date thereof (or, if such information is stated therein to be as of a different date, on such
different date), or the failure of any other information provided to any such Indemnified Party by,
or on behalf of, the Servicer to be true and correct on the date so provided (or, if such
information is stated therein to be as of a different date, on such different date), (b) the
failure of any representation, warranty or statement made or deemed made by the Servicer (or any of
its officers) under or in connection with this Agreement to have been true and correct as of the
date made or deemed made in all respects when made, (c) the failure by the Servicer to comply with
any applicable law, rule or regulation with respect to any Pool Receivable or the related Contract,
(d) any dispute, claim, offset or defense of the Obligor to the payment of any Receivable in, or
purporting to be in, the Receivables Pool resulting from or related to the collection activities
with respect to such Receivable, or (e) any failure of the Servicer to perform its duties or
obligations in accordance with the provisions hereof.

ARTICLE IV.

ADMINISTRATION AND COLLECTIONS

     Section 4.1 Appointment of the Servicer.

     (a) The servicing, administering and collection of the Pool Receivables shall be conducted by
the Person so designated from time to time as the Servicer in accordance with this Section. Until
the Administrator gives notice to Peabody (in accordance with this Section) of the designation of a
new Servicer, Peabody is hereby designated as, and hereby agrees to perform the duties and
obligations of, the Servicer pursuant to the terms hereof. Upon the occurrence of a Termination
Event, the Administrator may designate as Servicer any Person (including itself) to succeed Peabody
or any successor Servicer, on the condition in each case that any such Person so designated shall
agree to perform the duties and obligations of the Servicer pursuant to the terms hereof.

     (b) Upon the designation of a successor Servicer as set forth in clause (a) above,
Peabody agrees that it will terminate its activities as Servicer hereunder in a manner that the
Administrator determines will facilitate the transition of the performance of such activities to
the new Servicer, and Peabody shall cooperate with and assist such new Servicer. Such cooperation
shall include access to and transfer of related records and use by the new Servicer of all
licenses, hardware or software necessary or desirable to collect the Pool Receivables and the
Related Security.

     (c) Peabody acknowledges that, in making their decision to execute and deliver this Agreement,
the Administrator and the Purchasers have relied on Peabody’s agreement to act as Servicer
hereunder. Accordingly, Peabody agrees that it will not voluntarily resign as Servicer.

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     (d) The Servicer may and hereby does delegate its duties and obligations hereunder to the
Originators as subservicer (each a “Sub-Servicer”); provided, that, in such
delegation: (i) each such Sub-Servicer shall and hereby does agree in writing to perform the
duties and obligations of the Servicer pursuant to the terms hereof, (ii) the Servicer shall remain
primarily liable for the performance of the duties and obligations so delegated, (iii) the Seller,
the Administrator, the Purchaser Agents and the Purchasers shall have the right to look solely to
the Servicer for performance, and (iv) the terms of any agreement with any Sub-Servicer shall and
hereby do provide that the Administrator may terminate such agreement upon the termination of the
Servicer hereunder by giving notice of its desire to terminate such agreement to the Servicer (and
the Servicer shall provide appropriate notice to each such
Sub-Servicer); provided, however, that if any such delegation is to any Person
other than Arclar Company, LLC, Peabody Midwest Mining, LLC, Twentymile Coal, LLC, Caballo Coal,
LLC, COALSALES II, LLC, Peabody Western Coal Company, Powder River Coal, LLC, Peabody Holding
Company, LLC, COALTRADE, LLC or COALSALES, LLC, the Administrator shall have consented in writing
in advance to such delegation.

     Section 4.2 Duties of the Servicer.

     (a) The Servicer shall take or cause to be taken all such action as may be necessary or
advisable to administer and collect each Pool Receivable from time to time, all in accordance with
this Agreement and all applicable laws, rules and regulations, with reasonable care and diligence,
and in accordance with the Credit and Collection Policy. The Servicer shall set aside, for the
accounts of the Seller, the Administrator, the Purchaser Agents and the Purchasers, the amount of
the Collections to which each is entitled in accordance with Article I. The Servicer may,
in accordance with the applicable Credit and Collection Policy, extend the maturity of any Pool
Receivable and extend the maturity or adjust the Outstanding Balance of any Defaulted Receivable as
the Servicer may determine to be appropriate to maximize Collections thereof; provided,
however, that: for the purposes of this Agreement, (i) such extension shall not change the
number of days such Pool Receivable has remained unpaid from the date of the invoice date related
to such Pool Receivable, (ii) such extension or adjustment shall not alter the status of such Pool
Receivable as a Delinquent Receivable or a Defaulted Receivable or limit the rights of any of the
Purchasers, the Purchaser Agents or the Administrator under this Agreement and (iii) if a
Termination Event has occurred and is continuing and Peabody or an Affiliate thereof is serving as
the Servicer, Peabody or such Affiliate may make such extension or adjustment only upon the prior
approval of the Administrator. The Seller shall deliver to the Servicer and the Servicer shall
hold for the benefit of the Seller and the Administrator (individually and for the benefit of the
Purchasers), in accordance with their respective interests, all records and documents (including
computer tapes or disks) with respect to each Pool Receivable. Notwithstanding anything to the
contrary contained herein, the Administrator may direct the Servicer (whether the Servicer is
Peabody or any other Person) to commence or settle any legal action to enforce collection of any
Pool Receivable or to foreclose upon or repossess any Related Security.

     (b) The Servicer shall, as soon as practicable following actual receipt of collected funds,
turn over to the Seller the collections of any indebtedness that is not a Pool Receivable, less, if
Peabody or an Affiliate thereof is not the Servicer, all reasonable and appropriate out-of-

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pocket costs and expenses of such Servicer of servicing, collecting and administering such collections.
The Servicer, if other than Peabody or an Affiliate thereof, shall, as soon as practicable upon
demand, deliver to the Seller all records in its possession that evidence or relate to any
indebtedness that is not a Pool Receivable, and copies of records in its possession that evidence
or relate to any indebtedness that is a Pool Receivable.

     (c) The Servicer’s obligations hereunder shall terminate on the Final Payout Date.

     After such termination, if Peabody or an Affiliate thereof was not the Servicer on the date of
such termination, the Servicer shall promptly deliver to the Seller all books, records and related
materials that the Seller previously provided to the Servicer, or that have been obtained by the
Servicer, in connection with this Agreement.

     Section 4.3 Lock-Box Arrangements.

          Prior to the Closing Date, the Seller shall enter into Lock-Box Agreements with all of the
Lock-Box Banks and deliver original counterparts thereof to the Administrator. Upon the occurrence
of a Termination Event, the Administrator may at any time thereafter give notice to each Lock-Box
Bank that the Administrator is exercising its rights under the Lock-Box Agreements to do any or all
of the following: (a) to have the exclusive ownership and control of the Lock-Box Accounts
transferred to the Administrator (for the benefit of the Purchasers) and to exercise exclusive
dominion and control over the funds deposited therein, (b) to have the proceeds that are sent to
the respective Lock-Box Accounts redirected pursuant to the Administrator’s instructions rather
than deposited in the applicable Lock-Box Account, and (c) to take any or all other actions
permitted under the applicable Lock-Box Agreement. The Seller hereby agrees that if the
Administrator at any time takes any action set forth in the preceding sentence, the Administrator
shall have exclusive control (for the benefit of the Purchasers) of the proceeds (including
Collections) of all Pool Receivables and the Seller hereby further agrees to take any other action
that the
Administrator may reasonably request to transfer such control. Any proceeds of Pool
Receivables received by the Seller or the Servicer thereafter shall be sent immediately to the
Administrator. The parties hereto hereby acknowledge that if at any time the Administrator takes
control of any Lock-Box Account, the Administrator shall not have any rights to the funds therein
in excess of the unpaid amounts due to the Administrator, the Purchaser Agents, the Purchasers or
any other Person hereunder, and the Administrator shall distribute or cause to be distributed such
funds in accordance with Section 4.2(b) and Article I (in each case as if such
funds were held by the Servicer thereunder).

     Section 4.4 Enforcement Rights.

     (a) At any time following the occurrence and during the continuation of a Termination Event:

     (i) the Administrator may direct the Obligors that payment of all amounts payable under
any Pool Receivable is to be made directly to the Administrator or its designee (on behalf
of the Purchasers),

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     (ii) the Administrator may instruct the Seller or the Servicer to give notice of the
Purchasers’ interest in Pool Receivables to each Obligor, which notice shall direct that
payments be made directly to the Administrator or its designee (on behalf of the
Purchasers), and the Seller or the Servicer, as the case may be, shall give such notice at
the expense of the Seller or the Servicer, as the case may be; provided, that if the
Seller or the Servicer, as the case may be, fails to so notify each Obligor, the
Administrator (at the Seller’s or the Servicer’s, as the case may be, expense) may so notify
the Obligors, and

     (iii) the Administrator may request the Servicer to, and upon such request the Servicer
shall: (A) assemble all of the records necessary or desirable to collect the Pool
Receivables and the Related Security, and transfer or license to a successor Servicer the
use of all software necessary or desirable to collect the Pool Receivables and the Related
Security, and make the same available to the Administrator or its designee (for the benefit
of the Purchasers) at a place selected by the Administrator, and (B) segregate all cash,
checks and other instruments received by it from time to time constituting Collections in a
manner acceptable to the Administrator and, promptly upon receipt, remit all such cash,
checks and instruments, duly endorsed or with duly executed instruments of transfer, to the
Administrator or its designee (on behalf of the Purchasers).

     (b) The Seller hereby authorizes the Administrator, and irrevocably appoints the Administrator
as its attorney-in-fact with full power of substitution and with full authority in the place and
stead of the Seller, which appointment is coupled with an interest, to take any and all steps in
the name of the Seller and on behalf of the Seller necessary or desirable following the occurrence
and during the continuation of a Termination Event, in the determination of the Administrator, to
collect any and all amounts or portions thereof due under any and all Pool Assets, including
endorsing the name of the Seller on checks and other instruments representing Collections and
enforcing such Pool Assets. Notwithstanding anything to the contrary contained in this subsection,
none of the powers conferred upon such attorney-in-fact pursuant to the preceding sentence shall
subject such attorney-in-fact to any liability if any action taken by it shall prove to be
inadequate or invalid, nor shall they confer any obligations upon such attorney-in-fact in any
manner whatsoever.

     Section 4.5 Responsibilities of the Seller.

     (a) Anything herein to the contrary notwithstanding, the Seller shall: (i) perform all of its
obligations, if any, under the Contracts related to the Pool Receivables to the same extent as if
such Pool Receivables had not been transferred hereunder, and the exercise by the Administrator,
any Purchaser Agent or any Purchaser of their respective rights hereunder shall not relieve the
Seller from such obligations, and (ii) pay when due any taxes, including any sales taxes payable in
connection with the Pool Receivables and their creation and satisfaction. Neither the
Administrator nor any Purchaser Agent nor any Purchaser shall have any obligation or liability with
respect to any Pool Asset, nor shall any of them be obligated to perform any of the obligations of
the Seller, Peabody or any Originator thereunder.

     (b) Peabody hereby irrevocably agrees that if at any time it shall cease to be the Servicer
hereunder, it shall act (if the then-current Servicer so requests) as the data-processing

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agent of the Servicer and, in such capacity, Peabody shall conduct the data-processing functions of the
administration of the Receivables and the Collections thereon in substantially the same way that
Peabody conducted such data-processing functions while it acted as the Servicer.

     Section 4.6 Servicing Fee.

     (a) Subject to clause (b), the Servicer shall be paid a fee equal to 1.00% per
annum(the “Servicing Fee Rate”) of the daily average aggregate Outstanding Balance of
the Pool Receivables. Such fee shall be paid through the distributions contemplated by Section
1.6(d).

     (b) If the Servicer ceases to be Peabody or an Affiliate thereof, the servicing fee shall be
the greater of: (i) the amount calculated pursuant to clause (a), and (ii) an alternative
amount specified by the successor Servicer not to exceed 110% of the aggregate reasonable costs and
expenses incurred by such successor Servicer in connection with the performance of its obligations
as Servicer.

     Section 4.7 Agents.

     (a) Appointment and Authorization.

     (i) Each Purchaser and Purchaser Agent hereby irrevocably designates and appoints PNC
Bank, National Association, as the “Administrator” hereunder and authorizes the
Administrator to take such actions and to exercise such powers as are delegated to the
Administrator hereby and to exercise such other powers as are reasonably incidental thereto.
The Administrator shall hold, in its name, for the benefit of each Purchaser, ratably, the
Purchased Assets. The Administrator shall not have any duties other than those expressly
set forth herein or any fiduciary relationship with any Purchaser or Purchaser Agent, and no
implied obligations or liabilities shall be read into this Agreement, or otherwise exist,
against the Administrator. The Administrator does not assume, nor shall it be deemed to
have assumed, any obligation to, or relationship of trust or agency with, the Seller, the
Servicer or any Sub-Servicer. Notwithstanding any provision of this Agreement or any other
Transaction Document to the contrary, in no event shall the Administrator ever be required
to take any action which exposes the Administrator to personal liability or which is
contrary to the provision of any Transaction Document or applicable law.

     (ii) Each Purchaser hereby irrevocably designates and appoints the respective
institution identified as the Purchaser Agent for such Purchaser’s Purchaser Group on the
signature pages hereto or in the Assumption Agreement or Transfer Supplement pursuant to
which such Purchaser becomes a party hereto, and each authorizes such Purchaser Agent to
take such action on its behalf under the provisions of this Agreement and to exercise such
powers and perform such duties as are expressly delegated to such Purchaser Agent by the
terms of this Agreement, if any, together with such other powers as are reasonably
incidental thereto. Notwithstanding any provision to the contrary elsewhere in this
Agreement, no Purchaser Agent shall have any duties or responsibilities, except those
expressly set forth herein, or any fiduciary relationship with

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any Purchaser or other
Purchaser Agent or the Administrator, and no implied covenants, functions, responsibilities,
duties, obligations or liabilities on the part of such Purchaser Agent shall be read into
this Agreement or otherwise exist against such Purchaser Agent.

     (iii) Except as otherwise specifically provided in this Agreement, the provisions of
this Section 4.7 are solely for the benefit of the Purchaser Agents, the
Administrator and the Purchasers, and none of the Seller, the Servicer or any Sub-Servicer
shall have any rights as a third-party beneficiary or otherwise under any of the provisions
of this Section 4.7, except that this Section 4.7 shall not affect any
obligations which any Purchaser Agent, the Administrator or any Purchaser may have to the
Seller, the Servicer or any Sub-Servicer under the other provisions of this Agreement.
Furthermore, no Purchaser shall have any rights as a third-party beneficiary or otherwise
under any of the provisions hereof in respect of a Purchaser Agent which is not the
Purchaser Agent for such Purchaser.

     (iv) In performing its functions and duties hereunder, the Administrator shall act
solely as the agent of the Purchasers and the Purchaser Agents and does not assume nor shall
be deemed to have assumed any obligation or relationship of trust or agency with or for the
Seller, the Servicer or any Sub-Servicer or any of their successors and assigns. In
performing its functions and duties hereunder, each Purchaser Agent shall act solely as the
agent of its respective Purchaser and does not assume nor shall be deemed to have assumed
any obligation or relationship of trust or agency with or for the Seller, the Servicer, any
Sub-Servicer any other Purchaser, any other Purchaser Agent or the Administrator, or any of
their respective successors and assigns.

     (b) Delegation of Duties. The Administrator may execute any of its duties through
agents or attorneys-in-fact and shall be entitled to advice of counsel concerning all matters
pertaining to such duties. The Administrator shall not be responsible for the negligence or
misconduct of any agents or attorneys-in-fact selected by it with reasonable care.

     (c) Exculpatory Provisions. None of the Purchaser Agents, the Administrator or any of
their respective directors, officers, agents or employees shall be liable for any action taken or
omitted (i) with the consent or at the direction of the Majority Purchaser Agents (or in the case
of any Purchaser Agent, the Purchasers within its Purchaser Group that have a majority of the
aggregate Commitment of such Purchaser Group) or (ii) in the absence of such Person’s gross
negligence or willful misconduct. The Administrator shall not be responsible to any Purchaser,
Purchaser Agent or other Person for (i) any recitals, representations, warranties or other
statements made by the Seller, the Servicer, any Sub-Servicer, any Originator or any of their
Affiliates, (ii) the value, validity, effectiveness, genuineness, enforceability or sufficiency of
any Transaction Document, (iii) any failure of the Seller, the Servicer, any Sub-Servicer, any
Originator or any of their Affiliates to perform any obligation hereunder or under the other
Transaction Documents to which it is a party (or under any Contract), or (iv) the satisfaction of
any condition specified in Exhibit II. The Administrator shall not have any obligation to
any Purchaser or Purchaser Agent to ascertain or inquire about the observance or performance of any
agreement contained in any Transaction Document or to inspect the properties, books or records of
the Seller, the Servicer, any Sub-Servicer, any Originator or any of their respective Affiliates.

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     (d) Reliance by Agents.

     (i) Each Purchaser Agent and the Administrator shall in all cases be entitled to rely,
and shall be fully protected in relying, upon any document or other writing or conversation
believed by it to be genuine and correct and to have been signed, sent or made by the proper
Person and upon advice and statements of legal counsel (including counsel to the Seller or
the Servicer), independent accountants and other experts selected by the Administrator.
Each Purchaser Agent and the Administrator shall in all cases be fully justified in failing
or refusing to take any action under any Transaction Document unless it shall first receive
such advice or concurrence of the Majority Purchaser Agents (or in the case of any Purchaser
Agent, the Purchasers within its Purchaser Group that have a majority of the aggregate
Commitment of such Purchaser Group), and assurance of its indemnification, as it deems
appropriate.

     (ii) The Administrator shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement in accordance with a request of the Majority
Purchaser Agents or the Purchaser Agents, and such request and any action taken or failure
to act pursuant thereto shall be binding upon all Purchasers, the Administrator and
Purchaser Agents.

     (iii) The Purchasers within each Purchaser Group with a majority of the Commitment of
such Purchaser Group shall be entitled to request or direct the related Purchaser Agent to
take action, or refrain from taking action, under this Agreement on behalf of all of the
Purchasers within such Purchaser Group. Each Purchaser Agent also shall in all cases be
fully protected in acting, or in refraining from acting, under this Agreement in accordance
with a request of the Majority Purchaser Agents, and such request and any action taken or
failure to act pursuant thereto shall be binding upon all of such Purchaser Agent’s
Purchasers.

     (iv) Unless otherwise advised in writing by a Purchaser Agent or by any Purchaser on
whose behalf such Purchaser Agent is purportedly acting, each party to this Agreement may
assume that (i) such Purchaser Agent is acting for the benefit of each of the Purchasers in
respect of which such Purchaser Agent is identified as being the “Purchaser Agent” in the
definition of “Purchaser Agent” hereto, as well as for the benefit of each assignee or other
transferee from any such Person, and (ii) each action taken by such Purchaser Agent has been
duly authorized and approved by all necessary action on the part of the Purchasers on whose
behalf it is purportedly acting. Each Purchaser Agent and its Purchaser(s) shall agree
amongst themselves as to the circumstances and procedures for removal, resignation and
replacement of such Purchaser Agent. Each Purchaser shall promptly notify the Seller, the
Servicer and the Administrator in writing of any removal, resignation or replacement of such
Purchaser’s Purchaser Agent.

     (e) Notice of Termination Events. Neither any Purchaser Agent nor the Administrator
shall be deemed to have knowledge or notice of the occurrence of any Termination Event or Unmatured
Termination Event unless such Purchaser Agent or the

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Administrator, as applicable, has received notice from any Purchaser, Purchaser Agent, the
Servicer, any Sub-Servicer or the Seller stating that a Termination Event or an Unmatured
Termination Event has occurred hereunder and describing such Termination Event or Unmatured
Termination Event. In the event that the Administrator receives such a notice, it shall promptly
give notice thereof to each Purchaser Agent whereupon each such Purchaser Agent shall promptly give
notice thereof to its related Purchasers. In the event that a Purchaser Agent receives such a
notice (other than from the Administrator), it shall promptly give notice thereof to the
Administrator. The Administrator shall take such action concerning a Termination Event or an
Unmatured Termination Event as may be directed by the Majority Purchaser Agents (unless such action
otherwise requires the consent of all Purchasers, the LC Bank and/or the Required LC Participants),
but until the Administrator receives such directions, the Administrator may (but shall not be
obligated to) take such action, or refrain from taking such action, as the Administrator deems
advisable and in the best interests of the Purchasers and the Purchaser Agents.

     (f) Non-Reliance on Administrator, Purchaser Agents and Other Purchasers. Each
Purchaser expressly acknowledges that none of the Administrator, the Purchaser Agents nor any of
their respective officers, directors, employees, agents, attorneys-in-fact or Affiliates has made
any representations or warranties to it and that no act by the Administrator, or any Purchaser
Agent hereafter taken, including any review of the affairs of the Seller, the Servicer, any
Sub-Servicer, any Originator or any of their respective Affiliates, shall be deemed to constitute
any representation or warranty by the Administrator or such Purchaser Agent, as applicable. Each
Purchaser represents and warrants to the Administrator and the Purchaser Agents that, independently
and without reliance upon the Administrator, Purchaser Agents or any other Purchaser and based on
such documents and information as it has deemed appropriate, it has made and will continue to make
its own appraisal of and investigation into the business, operations, property, prospects,
financial and other conditions and creditworthiness of the Seller, the Servicer, the Sub-Servicers,
the Originators and the Receivables and its own decision to enter into this Agreement and to take,
or omit, action under any Transaction Document. Except for items specifically required to be
delivered hereunder, the Administrator shall not have any duty or responsibility to provide any
Purchaser Agent or any Purchaser with any information concerning the Seller, the Servicer, the
Sub-Servicers, the Originators or any of their Affiliates that comes into the possession of the
Administrator or any of its officers, directors, employees, agents, attorneys-in-fact or
Affiliates.

     (g) Administrators and Affiliates. Each of the Purchasers, the Purchaser Agents and
the Administrator and any of their respective Affiliates may extend credit to, accept deposits from
and generally engage in any kind of banking, trust, debt, entity or other business with the Seller,
the Servicer, any Sub-Servicer, any Originator or any of their Affiliates. With respect to the
acquisition of the Eligible Receivables pursuant to this Agreement, each of the Purchaser Agents
and the Administrator shall have the same rights and powers under this Agreement as any Purchaser
and may exercise the same as though it were not such an agent, and the terms “Purchaser” and
“Purchasers” shall include, to the extent applicable, each of the Purchaser Agents and the
Administrator in their individual capacities.

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     (h) Indemnification. Each LC Participant and Related Committed Purchaser shall
indemnify and hold harmless the Administrator (solely in its capacity as Administrator) and the LC
Bank (solely in its capacity as LC Bank) and their respective officers, directors, employees,
representatives and agents (to the extent not reimbursed by the Seller, the Servicer, any
Sub-Servicer or any Originator and without limiting the obligation of the Seller, the Servicer, any
Sub-Servicer or any Originator to do so), ratably (based on its Commitment) from and against any
and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
settlements, costs, expenses or disbursements of any kind or nature whatsoever (including in
connection with any investigative or threatened proceeding, whether or not the Administrator, the
LC Bank or such Person shall be designated a party thereto) that may at any time be imposed on,
incurred by or asserted against the Administrator, the LC Bank or such Person as a result of, or
related to, any action taken or omitted by the Administrator or the LC Bank under the Transaction
Documents, any of the transactions contemplated by the Transaction Documents or the execution,
delivery or performance of the Transaction Documents or any other document furnished in connection
therewith (but excluding any such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, settlements, costs, expenses or disbursements resulting solely from the gross
negligence or willful misconduct of the Administrator, the LC Bank or such Person as determined by
a final non-appealable judgment of a court of competent jurisdiction). Without limiting the
generality of the foregoing, each LC Participant agrees to reimburse the Administrator and the LC
Bank, ratably according to its Pro Rata Share, promptly upon demand, for any out of pocket expenses
(including reasonable counsel fees) incurred by the Administrator or the LC Bank in connection with
the administration, modification, amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of, its rights and responsibilities under
this Agreement.

     (i) Successor Administrator. The Administrator may, upon at least thirty (30) days’
notice to the Seller, the Servicer and each Purchaser Agent, resign as Administrator. Such
resignation shall not become effective until a successor Administrator is appointed by the Majority
Purchaser Agents, with the consent of the Seller (which consent shall not be unreasonably withheld
or delayed and which consent shall not be required if a Termination Event shall have occurred and
is continuing), and has accepted such appointment. Upon such acceptance of its appointment as
Administrator hereunder by a successor Administrator, such successor Administrator shall succeed to
and become vested with all the rights and duties of the retiring Administrator, and the retiring
Administrator shall be discharged from its duties and obligations under the Transaction Documents.
After any retiring Administrator’s resignation hereunder, the provisions of Sections 3.1
and 3.2 and this Section 4.7 shall inure to its benefit as to any actions taken or
omitted to be taken by it while it was the Administrator.

     (j) UCC Filings. Each of the Seller, the Purchaser Agents and the Purchasers
expressly recognizes and agrees that the Administrator may be listed as the assignee or secured
party of record on the various UCC filings required to be made hereunder in order to perfect the
sale of the Purchased Assets from the Seller to the Purchasers, that such listing shall be for
administrative convenience only in creating a record or nominee owner to take certain actions
hereunder on behalf of the Purchasers and that such listing will not affect in any way the status
of the Purchasers as the owners of the Purchased Assets. In addition, such listing shall impose no

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duties on the Administrator other than those expressly and specifically undertaken in
accordance with this clause (j).

ARTICLE V.

MISCELLANEOUS

     Section 5.1 Amendments, Etc.

          No amendment or waiver of any provision of this Agreement or any other Transaction Document,
or consent to any departure by the Seller, the Servicer or any Sub-Servicer therefrom, shall be
effective unless in a writing signed by the Administrator, the LC Bank, the Majority Purchaser
Agents and the Majority LC Participants; provided, however, that no such amendment
shall (i) decrease the outstanding amount of, or extend the repayment of or any scheduled payment
date for the payment of, any Discount in respect of any Portion of Capital or any Fees owed to a
Purchaser without the prior written consent of such Purchaser; (ii) forgive or waive or otherwise
excuse any repayment of Capital without the prior written consent of each Purchaser affected
thereby; (iii) increase the Commitment of any Purchaser without its prior written consent; (iv)
amend or modify the Pro Rata Share of any LC Participant without its prior written consent; (v)
amend or modify the provisions of this Section 5.1 or the definition of “Majority Purchaser
Agents”, “Majority LC Participants” or “Required LC Participants” without the prior written consent
of all Purchaser Agents, the LC Bank and all LC Participants; (vi) waive any Termination Event
arising from an Event of Bankruptcy with respect to Seller, the Servicer, any Sub-Servicer or any
Originator; (vii) without the prior written consent of all Purchasers affected thereby, extend the
Facility Termination Date or waive, amend or otherwise modify the definition of Facility
Termination Date; (viii) amend, modify or otherwise affect the rights or duties of the
Administrator, any Purchaser Agent or the LC Bank hereunder without the prior written consent of
the Administrator, such Purchaser Agent or the LC Bank, as the case may be; and (ix) amend, waive
or modify any definition or provision expressly requiring the consent of the Required LC
Participants without the prior written consent of the LC Bank and the Required LC Participants,
and, in the case of any amendment, by the other parties thereto; and then such amendment, waiver or
consent shall be effective only in the specific instance and for the specific purpose for which
given. No failure on the part of the Administrator, any Purchaser Agent or any Purchaser to
exercise, and no delay in exercising any right hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any right hereunder preclude any other or further exercise
thereof or the exercise of any other right.

     Section 5.2 Notices, Etc.

          All notices and other communications hereunder shall, unless otherwise stated herein, be in
writing (which shall include facsimile communication) and be sent or delivered to each party hereto
at its address set forth under its name on the signature pages hereof or at such other address as
shall be designated by such party in a written notice to the other parties hereto. Notices and
communications by facsimile shall be effective when sent (and shall be followed by hard copy sent
by first class mail), and notices and communications sent by other means shall be effective when
received.

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     Section 5.3 Successors and Assigns; Assignability; Participations.

     (a) Successors and Assigns. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns. Except as otherwise
provided in Section 4.1(d), neither the Seller nor the Servicer may assign or transfer any
of its rights or delegate any of its duties hereunder or under any Transaction Document without the
prior consent of the Administrator, the LC Bank, the Required LC Participants and the Purchaser
Agents.

     (b) Participations. (i) Except as otherwise specifically provided herein, any
Purchaser may sell to one or more Persons (each a “Participant”) participating interests in
the interests of such Purchaser hereunder. Such Purchaser shall remain solely responsible for
performing its obligations hereunder, and the Seller, the Servicer, each Purchaser Agent and the
Administrator shall continue to deal solely and directly with such Purchaser in connection with
such Purchaser’s rights and obligations hereunder. A Purchaser shall not agree with a Participant
to restrict such Purchaser’s right to agree to any amendment or waiver of this Agreement or any
other Transaction Document, except such amendments or waivers that require the consent of all
Purchasers; provided, that no such agreement between any Purchaser and any such Participant
shall be binding upon the other parties hereto. (ii) Notwithstanding anything contained in
paragraph (a) or clause (i) of paragraph (b) of this Section 5.3,
each of the LC Bank and each LC Participant may sell participations in all or any part of any
Investment made by such LC Participant to another bank or other entity so long as (i) no such sale
of a participation shall, without the consent of the Seller, require the Seller to file a
registration statement with the SEC and (ii) no holder of any such participation shall be entitled
to require such LC Participant to take or omit to take any action hereunder except that such LC
Participant may agree with such participant that, without such Participant’s consent, such LC
Participant will not consent to an amendment, modification or waiver referred to in Section
5.1. Any such Participant shall not have any rights hereunder or under the Transaction
Documents.

     (c) Assignments by Certain Related Committed Purchasers. Any Related Committed
Purchaser may assign to one or more Persons (each a “Purchasing Related Committed
Purchaser”), reasonably acceptable to the Administrator, the LC Bank and the related Purchaser
Agent in its sole discretion, any portion of its Commitment (which shall be inclusive of its
Commitment as an LC Participant) pursuant to a supplement hereto, substantially in the form of
Annex G with any changes as are reasonably acceptable to the Administrator (each, a
“Transfer Supplement”), executed by each such Purchasing Related Committed Purchaser, such
selling Related Committed Purchaser, such related Purchaser Agent and the Administrator and with
the consent of the Seller (provided, that the consent of the Seller shall not be
unreasonably withheld or delayed and that no such consent shall be required if a Termination Event
or Unmatured Termination Event has occurred and is continuing; provided, further,
that no consent of the Seller shall be required if the assignment is made by any Related Committed
Purchaser to the Administrator, to any Purchaser Agent, to any other Related Committed Purchaser,
to any Affiliate of the Administrator or any Related Committed Purchaser, to any Program Support
Provider or any Person which (i) is in the business of issuing commercial paper notes and (ii) is
associated with or administered by the Administrator or any Affiliate of the Administrator). Any
such assignment by Related Committed Purchaser may not be for an amount less than

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$10,000,000. Upon (i) the execution of the Transfer Supplement, (ii) delivery of an executed
copy thereof to the Seller, the Servicer, such related Purchaser Agent and the Administrator and
(iii) payment by the Purchasing Related Committed Purchaser to the selling Related Committed
Purchaser of the agreed purchase price, if any, such selling Related Committed Purchaser shall be
released from its obligations hereunder to the extent of such assignment and such Purchasing
Related Committed Purchaser shall for all purposes be a Related Committed Purchaser party hereto
and shall have all the rights and obligations of a Related Committed Purchaser hereunder to the
same extent as if it were an original party hereto. The amount of the Commitment of the selling
Related Committed Purchaser allocable to such Purchasing Related Committed Purchaser shall be equal
to the amount of the Commitment of the selling Related Committed Purchaser transferred regardless
of the purchase price, if any, paid therefor.

     (d) Assignments to Liquidity Banks and other Program Support Providers. Any Conduit
Purchaser may at any time grant to one or more of its Liquidity Banks or other Program Support
Providers, interests in its portion of the Purchased Assets. In the event of any such grant by
such Conduit Purchaser of an interest to a Liquidity Bank or other Program Support Provider, such
Conduit Purchaser shall remain responsible for the performance of its obligations hereunder. The
Seller agrees that each Liquidity Bank and Program Support Provider of any Conduit Purchaser
hereunder shall be entitled to the benefits of Sections 1.9 and 1.10.

     (e) Other Assignment by Conduit Purchasers. Each party hereto agrees and consents (i)
to any Conduit Purchaser’s assignment, grant of security interests in or other transfers of any
portion of its interest in the Purchased Assets, including without limitation to any collateral
agent in connection with its commercial paper program and (ii) to the complete assignment by any
Conduit Purchaser of all of its rights and obligations hereunder to any other Person, and upon such
assignment such Conduit Purchaser shall be released from all obligations and duties, if any,
hereunder; provided, that such Conduit Purchaser may not, without the prior consent of its
Related Committed Purchasers, make any such transfer of its rights hereunder unless the assignee
(i) is principally engaged in the purchase of assets similar to the assets being purchased
hereunder, (ii) has as its Purchaser Agent the Purchaser Agent of the assigning Conduit Purchaser
and (iii) issues commercial paper or other Notes with credit ratings substantially comparable to
the ratings of the assigning Conduit Purchaser. Any assigning Conduit Purchaser shall deliver to
any assignee a Transfer Supplement with any changes as have been approved by the parties thereto,
duly executed by such Conduit Purchaser, assigning any portion of its interest in the Purchased
Assets to its assignee. Such Conduit Purchaser shall promptly (i) notify each of the other parties
hereto of such assignment and (ii) take all further action that the assignee reasonably requests in
order to evidence the assignee’s right, title and interest in such interest in the Purchased Assets
and to enable the assignee to exercise or enforce any rights of such Conduit Purchaser hereunder.
Upon the assignment of any portion of its interest in the Purchased Assets, the assignee shall have
all of the rights hereunder with respect to such interest (except that the Discount therefor shall
thereafter accrue at the rates determined with respect to the assigning Conduit Purchaser unless
the Seller, the related Purchaser Agent and the assignee shall have agreed upon a different
Discount).

     (f) Opinions of Counsel. If required by the Administrator or the applicable Purchaser
Agent or to maintain the ratings of the Notes of any Conduit Purchaser, each Transfer

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Supplement or other assignment and acceptance agreement must be accompanied by an opinion of
counsel of the assignee as to such matters as the Administrator or such Purchaser Agent may
reasonably request.

     Section 5.4 Costs, Expenses and Taxes.

     (a) In addition to the rights of indemnification granted under Sections 1.18
and 3.1, the Seller agrees to pay on demand (which demand shall be accompanied by
documentation thereof in reasonable detail) all reasonable costs and expenses in connection with
the preparation, execution, delivery and administration (including periodic internal audits by the
Administrator of Pool Receivables, provided that at any time when no Termination Event
exists and is continuing, the Seller shall not be required to pay the costs and expenses of more
than one such audit per year) of this Agreement, the other Transaction Documents and the other
documents and agreements to be delivered hereunder (and all reasonable costs and expenses in
connection with any amendment, waiver or modification of any thereof), including: (i) Attorney
Costs for the Administrator, the Purchaser Agents, the Purchasers and their respective Affiliates
and agents with respect thereto and with respect to advising the Administrator, the Purchaser
Agents, the Purchasers and their respective Affiliates and agents as to their rights and remedies
under this Agreement and the other Transaction Documents, (ii) fees, costs and expenses payable by
the Conduit Purchasers or their Affiliates to any nationally recognized statistical rating agency
in connection with the transactions contemplated by the Transaction Documents and obtaining or
maintaining the credit ratings of the Notes issued by such Conduit Purchaser to fund or maintain
its Capital, and (iii) all reasonable costs and expenses (including Attorney Costs), if any, of the
Administrator, the Purchaser Agents, the Purchasers and their respective Affiliates and agents in
connection with the enforcement of this Agreement and the other Transaction Documents.

     (b) In addition, the Seller shall pay on demand any and all stamp and other taxes and fees
payable in connection with the execution, delivery, filing and recording of this Agreement or the
other documents or agreements to be delivered hereunder, and shall save each Indemnified Party
harmless from and against any liabilities with respect to or resulting from any delay in paying or
omission to pay such taxes and fees.

     Section 5.5 No Proceedings; Limitation on Payments.

          Each of the Seller, Peabody, the Servicer, the Administrator, each Purchaser Agent, the
Purchasers and each assignee of the Purchased Assets or any interest therein, and each Person that
enters into a commitment to purchase or make Investments in the Purchased Assets or any interest
therein, hereby covenants and agrees that it will not institute against, or join any other Person
in instituting against, any Conduit Purchaser any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceeding, or other proceeding under any federal or state bankruptcy or
similar law, for one year and one day after the latest maturing Note issued by such Conduit
Purchaser is paid in full. The provision of this Section 5.5 shall survive any termination
of this Agreement.

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     Section 5.6 Confidentiality.

          Each of the Seller and the Servicer agrees to maintain the confidentiality of this Agreement
and the other Transaction Documents (and all drafts thereof) in communications with third parties
and otherwise; provided, that this Agreement and the other Transaction Documents may be
disclosed to: (a) third parties to the extent such disclosure is made pursuant to a written
agreement of confidentiality in form and substance reasonably satisfactory to the Administrator,
(b) the Seller’s legal counsel and auditors if they agree to hold it confidential, and (c) as
otherwise required by applicable law (including applicable SEC requirements); and provided,
further, however, that the Seller and the Servicer may disclose this Agreement and
the other Transaction Documents (other than the Fee Letters or any such Transaction Document that
discloses the Fees) to other financial institutions and their affiliates in connection with a
replacement of the receivables securitization facility represented by this Agreement and the other
Transaction Documents with a new receivables securitization facility. The Seller and the Servicer
shall cause any financial institution and its affiliates described in the foregoing proviso to
maintain the confidentiality of the Transaction Documents in accordance with the Seller’s and the
Servicer’s obligations under this Section 5.6; provided, however, that any such financial
institution and its affiliates may disclose this Agreement and the other Transaction Documents it
receives in accordance with the immediately preceding sentence to their legal counsel and auditors
if they agree to hold them confidential and to any regulatory authorities having jurisdiction over
such financial institution or its affiliates. Unless otherwise required by applicable law, each of
the Administrator, the Purchaser Agents and the Purchasers agrees to maintain the confidentiality
of non-public financial information regarding Peabody and its Subsidiaries and Affiliates;
provided, that such information may be disclosed to: (i) third parties to the extent such
disclosure is made pursuant to a written agreement of confidentiality in form and substance
reasonably satisfactory to Peabody, (ii) legal counsel and auditors of the Administrator, the
Purchaser Agents and the Purchasers if they agree to hold it confidential, (iii) the rating
agencies rating the Notes, (iv) any Program Support Provider or potential Program Support Provider
(if they agree to hold it confidential), (v) any placement agent placing the Notes (if they agree
to hold it confidential) and (vi) any regulatory authorities having jurisdiction over PNC, any
Purchaser Agent, any Purchaser or any Program Support Provider.

     Section 5.7 GOVERNING LAW AND JURISDICTION.

     (a) THIS AGREEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL
LAWS OF THE STATE OF ILLINOIS EXCEPT TO THE EXTENT THAT THE VALIDITY OR PERFECTION OF A SECURITY
INTEREST OR REMEDIES HEREUNDER IN RESPECT OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY THE LAWS OF
A JURISDICTION OTHER THAN THE STATE OF ILLINOIS.

     (b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT MAY BE BROUGHT IN THE COURTS
OF THE STATE OF ILLINOIS OR OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF ILLINOIS; AND, BY
EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF THE PARTIES HERETO CONSENTS, FOR ITSELF AND IN
RESPECT OF ITS PROPERTY, TO THE

40

 

NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES, TO
THE MAXIMUM EXTENT PERMITTED BY LAW, ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE
OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, THAT IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING
OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT
RELATED HERETO. EACH OF THE PARTIES HERETO WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR
OTHER PROCESS, WHICH SERVICE MAY BE MADE BY ANY OTHER MEANS PERMITTED BY ILLINOIS LAW.

     Section 5.8 Execution in Counterparts.

          This Agreement may be executed in any number of counterparts, each of which, when so executed,
shall be deemed to be an original, and all of which, when taken together, shall constitute one and
the same agreement.

     Section 5.9 Survival of Termination; Non-Waiver.

          The provisions of Sections 1.9, 1.10, 1.21, 1.22, 3.1,
3.2, 4.7, 5.4, 5.5, 5.6, 5.7, 5.10 and
5.14 shall survive any termination of this Agreement. Neither the Servicer nor any other
Person may waive a breach of Exhibit III, Section 1(g) of this Agreement for so
long as the Notes are outstanding.

     Section 5.10 WAIVER OF JURY TRIAL.

          EACH OF THE PARTIES HERETO WAIVES THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR
CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE
PARTIES AGAINST ANY OTHER PARTY OR PARTIES, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS OR
OTHERWISE. EACH OF THE PARTIES HERETO AGREES THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED
BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, EACH OF THE PARTIES HERETO
FURTHER AGREES THAT ITS RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION
AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING THAT SEEKS, IN WHOLE OR IN PART, TO CHALLENGE
THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR ANY PROVISION HEREOF. THIS WAIVER SHALL APPLY
TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT.

     Section 5.11 Entire Agreement.

          This Agreement and the other Transaction Documents embody the entire agreement and
understanding between the parties hereto, and supersede all prior or contemporaneous agreements and
understandings of such Persons, verbal or written, relating to the subject matter hereof and
thereof.

41

 

     Section 5.12 Headings.

          The captions and headings of this Agreement and any Exhibit, Schedule or Annex hereto are for
convenience of reference only and shall not affect the interpretation hereof or thereof.

     Section 5.13 Sharing of Recoveries.

          Each Purchaser agrees that if it receives any recovery, through set-off, judicial action or
otherwise, on any amount payable or recoverable hereunder in a greater proportion than should have
been received hereunder or otherwise inconsistent with the provisions hereof (including, without
limitation, Section 1.8(a) hereof), then the recipient of such recovery shall purchase for
cash an interest in amounts owing to the other Purchasers (as return of Capital or otherwise),
without representation or warranty except for the representation and warranty that such interest is
being sold by each such other Purchaser free and clear of any Adverse Claim created or granted by
such other Purchaser, in the amount necessary to create proportional participation by the Purchaser
in such recovery. If all or any portion of such amount is thereafter recovered from the recipient,
such purchase shall be rescinded and the purchase price restored to the extent of such recovery,
but without interest.

     Section 5.14 Purchaser Groups’ Liabilities.

          The obligations of each Purchaser Agent and each Purchaser under the Transaction Documents are
solely the corporate obligations of such Person. Except with respect to any claim arising out of
the willful misconduct or gross negligence of the Administrator, any Purchaser Agent or any
Purchaser, no claim may be made by the Seller or the Servicer or any other Person against the
Administrator, any Purchaser Agent or any Purchaser or their respective Affiliates, directors,
officers, employees, attorneys or agents for any special, indirect, consequential or punitive
damages in respect of any claim for breach of contract or any other theory of liability arising out
of or related to the transactions contemplated by this Agreement or any other Transaction Document
or any act, omission or event occurring in connection therewith; and each of Seller and Servicer
hereby waives, releases, and agrees not to sue upon any claim for any such damages, whether or not
accrued and whether or not known or suspected to exist in its favor.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

42

 

     IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their respective
officers thereunto duly authorized, as of the date first above written.

THE SELLER:

	 	 	 	 	 
	 	P&L RECEIVABLES COMPANY, LLC,

as Seller
 	 
	 
	 	By:  	/s/ Walter L. Hawkins, Jr.
 	 
	 	 	Name:  	Walter L. Hawkins, Jr. 	 
	 	 	Title:  	Senior Vice President and Treasurer 	 

	 	 	 	 	 
	 

	 	Address:
	 	701 Market Street
	 

	 	 	 	St. Louis, MO 63101
	 

	 	Attention:
	 	Treasurer
	 

	 	Telephone:
	 	314-342-3400
	 

	 	Facsimile:
	 	314-342-7740

THE SERVICER:

	 	 	 	 	 
	 	PEABODY ENERGY CORPORATION,

as initial Servicer
 	 
	 
	 	By:  	/s/ Walter L. Hawkins, Jr.
 	 
	 	 	Name:  	Walter L. Hawkins, Jr. 	 
	 	 	Title:  	Senior Vice President and Treasurer 	 

	 	 	 	 	 
	 

	 	Address:
	 	701 Market Street
	 

	 	 	 	St. Louis, MO 63101
	 

	 	Attention:
	 	Treasurer
	 

	 	Telephone:
	 	314-342-3400
	 

	 	Facsimile:
	 	314-342-7740

Amended and Restated

Receivables Purchase Agreement

S-1

 

THE SUB-SERVICERS:

	 	 	 	 	 
	 	ARCLAR COMPANY, LLC,

as Sub-Servicer
 	 
	 
	 	By:  	/s/ Walter L. Hawkins, Jr.
 	 
	 	 	Name:  	Walter L. Hawkins, Jr. 	 
	 	 	Title:  	Senior Vice President and Treasurer 	 

	 	 	 	 	 
	 

	 	Address:
	 	701 Market Street
	 

	 	 	 	St. Louis, MO 63101
	 

	 	Attention:
	 	Treasurer
	 

	 	Telephone:
	 	314-342-3400
	 

	 	Facsimile:
	 	341-342-7740

	 	 	 	 	 
	 	PEABODY MIDWEST MINING, LLC,

as Sub-Servicer

 	 
	 
	 	By:  	/s/ Walter L. Hawkins, Jr.
 	 
	 	 	Name:  	Walter L. Hawkins, Jr. 	 
	 	 	Title:  	Senior Vice President and Treasurer 	 

	 	 	 	 	 
	 

	 	Address:
	 	701 Market Street
	 

	 	 	 	St. Louis, MO 63101
	 

	 	Attention:
	 	Treasurer
	 

	 	Telephone:
	 	314-342-3400
	 

	 	Facsimile:
	 	341-342-7740

Amended and Restated

Receivables Purchase Agreement

S-2

 

	 	 	 	 	 
	 	TWENTYMILE COAL, LLC,

as Sub-Servicer
 	 
	 
	 	By:  	/s/ Walter L. Hawkins, Jr.
 	 
	 	 	Name:  	Walter L. Hawkins, Jr. 	 
	 	 	Title:  	Senior Vice President and Treasurer 	 

	 	 	 	 	 
	 

	 	Address:
	 	701 Market Street
	 

	 	 	 	St. Louis, MO 63101
	 

	 	Attention:
	 	Treasurer
	 

	 	Telephone:
	 	314-342-3400
	 

	 	Facsimile:
	 	341-342-7740

	 	 	 	 	 
	 	CABALLO COAL, LLC,

as Sub-Servicer
 	 
	 
	 	By:  	/s/ Walter L. Hawkins, Jr.
 	 
	 	 	Name:  	Walter L. Hawkins, Jr. 	 
	 	 	Title:  	Senior Vice President and Treasurer 	 

	 	 	 	 	 
	 

	 	Address:
	 	701 Market St.
	 

	 	 	 	St. Louis, MO 63101-1826
	 

	 	Attention:
	 	Treasurer
	 

	 	Telephone:
	 	314-342-3400
	 

	 	Facsimile:
	 	314-342-7740

Amended and Restated

Receivables Purchase Agreement

S-3

 

	 	 	 	 	 
	 	COALSALES II, LLC,

as Sub-Servicer
 	 
	 
	 	By:  	/s/ Walter L. Hawkins, Jr.
 	 
	 	 	Name:  	Walter L. Hawkins, Jr. 	 
	 	 	Title:  	Senior Vice President and Treasurer 	 

	 	 	 	 	 
	 

	 	Address:
	 	701 Market St.
	 

	 	 	 	St. Louis, MO 63101-1826
	 

	 	Attention:
	 	Treasurer
	 

	 	Telephone:
	 	314-342-3400
	 

	 	Facsimile:
	 	314-342-7740

	 	 	 	 	 
	 	PEABODY WESTERN COAL COMPANY,

as Sub-Servicer
 	 
	 
	 	By:  	/s/ Walter L. Hawkins, Jr.
 	 
	 	 	Name:  	Walter L. Hawkins, Jr. 	 
	 	 	Title:  	Senior Vice President and Treasurer 	 

	 	 	 	 	 
	 

	 	Address:
	 	701 Market St.
	 

	 	 	 	St. Louis, MO 63101-1826
	 

	 	Attention:
	 	Treasurer
	 

	 	Telephone:
	 	314-342-3400
	 

	 	Facsimile:
	 	314-342-7740

Amended and Restated

Receivables Purchase Agreement

S-4

 

	 	 	 	 	 
	 	POWDER RIVER COAL, LLC,

as Sub-Servicer
 	 
	 
	 	By:  	/s/ Walter L. Hawkins, Jr.
 	 
	 	 	Name:  	Walter L. Hawkins, Jr. 	 
	 	 	Title:  	Senior Vice President and Treasurer 	 
	 

	 	 	 	 	 
	 

	 	Address:
	 	701 Market St.

St. Louis, MO 63101-1826
	 

	 	Attention:
	 	Treasurer
	 

	 	Telephone: 
	 	314-342-3400
	 

	 	Facsimile:
	 	314-342-7740

	 	 	 	 	 
	 	PEABODY HOLDING COMPANY, LLC,

as Sub-Servicer

 	 
	 
	 	By:  	/s/ Walter L. Hawkins, Jr.
 	 
	 	 	Name:  	Walter L. Hawkins, Jr. 	 
	 	 	Title:  	Senior Vice President and Treasurer 	 
	 

	 	 	 	 	 
	 

	 	Address:
	 	701 Market St.

St. Louis, MO 63101-1825
	 

	 	Attention:
	 	Treasurer
	 

	 	Telephone: 
	 	314-342-3400
	 

	 	Facsimile:
	 	314-342-7740

Amended and Restated

Receivables Purchase Agreement

S-5

 

	 	 	 	 	 
	 	COALTRADE, LLC,

as Sub-Servicer

 	 
	 	 	 
	 	By:  	/s/ Walter L. Hawkins, Jr.
 	 
	 	 	Name:  	Walter L. Hawkins, Jr. 	 
	 	 	Title:  	Senior Vice President and Treasurer 	 
	 

	 	 	 	 	 
	 

	 	Address:
	 	701 Market St.

St. Louis, MO 63101-1825
	 

	 	Attention:
	 	Treasurer
	 

	 	Telephone:
	 	314-342-3400
	 

	 	Facsimile:
	 	314-342-7740

	 	 	 	 	 
	 	COALSALES, LLC,

as Sub-Servicer

 	 
	 	 	 
	 	By:  	/s/ Walter L. Hawkins, Jr.
 	 
	 	 	Name:  	Walter L. Hawkins, Jr. 	 
	 	 	Title:  	Senior Vice President and Treasurer 	 
	 

	 	 	 	 	 
	 

	 	Address:
	 	701 Market St.

St. Louis, MO 63101-1825
	 

	 	Attention:
	 	Treasurer
	 

	 	Telephone:
	 	314-342-3400
	 

	 	Facsimile:
	 	314-342-7740

Amended and Restated

Receivables Purchase Agreement

S-6

 

                    
   MARKET STREET FUNDING LLC’S
 PURCHASER GROUP:

	 	 	 	 	 
	 	PNC BANK, NATIONAL ASSOCIATION,

as Purchaser Agent for the Market Street Purchaser

Group

 	 
	 
	 	By:  	/s/ William Falcon
 	 
	 	 	Name:  	William Falcon 	 
	 	 	Title:  	Vice President 	 
	 

	 	 	 	 	 
	 

	 	Address:
	 	PNC Bank, National Association

One PNC Plaza, 26th Floor

249 Fifth Avenue

Pittsburgh, PA 15222-2707
	 

	 	Attention:
	 	William Falcon
	 

	 	Telephone:
	 	412-762-5442
	 

	 	Facsimile:
	 	412-762-9184
	 
	 	 	 	 
	 	 	Group Commitment: $175,000,000

Amended and Restated

Receivables Purchase Agreement

S-7

 

	 	 	 	 	 
	 	MARKET STREET FUNDING LLC,

as Related Committed Purchaser

 	 
	 	 	 
	 	By:  	/s/ Doris J. Hearn
 	 
	 	 	Name:  	Doris J. Hearn 	 
	 	 	Title:  	Vice President 	 
	 

	 	 	 	 	 
	 

	 	Address:
	 	Market Street Funding LLC 

c/o AMACAR Group, LLC 

6525 Morrison Boulevard, Suite 318

Charlotte, NC 28211
	 

	 	Attention:
	 	Doug Johnson
	 

	 	Telephone:
	 	704-365-0569
	 

	 	Facsimile:
	 	704-365-1362
	 
	 	 	 	 
	 	 	With a copy to its Purchaser Agent
	 
	 	 	 	 
	 	 	Commitment: $175,000,000

Amended and Restated

Receivables Purchase Agreement

S-8

 

	 	 	 	 	 
	 	MARKET STREET FUNDING LLC,

as Conduit Purchaser

 	 
	 	By:  	/s/ Doris J. Hearn
 	 
	 	 	Name:  	Doris J. Hearn 	 
	 	 	Title:  	Vice President 	 
	 

	 	 	 	 	 
	 

	 	Address:
	 	Market Street Funding LLC
	 

	 	 	 	c/o AMACAR Group, LLC
	 

	 	 	 	6525 Morrison Boulevard, Suite 318
	 

	 	 	 	Charlotte, NC 28211
	 

	 	Attention:
	 	Doug Johnson
	 

	 	Telephone:
	 	704-365-0569
	 

	 	Facsimile:
	 	704-365-1362
	 
	 	 	 	 
	 	 	With a copy to its Purchaser Agent

Amended and Restated

Receivables Purchase Agreement

S-9

 

	 	 	 	 	 
	 	PNC BANK, NATIONAL ASSOCIATION,

as the LC Bank and as an LC Participant

 	 
	 	By:  	/s/ Richard Munsick
 	 
	 	 	Name:  	Richard Munsick 	 
	 	 	Title:  	Senior Vice President 	 
	 

	 	 	 	 	 
	 

	 	Address:
	 	PNC Bank, National Association
	 

	 	 	 	500 First Avenue
	 

	 	 	 	Third Floor
	 

	 	 	 	Pittsburgh, PA 15219
	 

	 	Attention:
	 	Richard Munsick
	 

	 	Telephone:
	 	412-762-4299
	 

	 	Facsimile:
	 	412-762-9184
	 
	 	 	 	 
	 	 	Commitment: $175,000,000
	 	 	Pro-Rata Share: 63.64%

Amended and Restated

Receivables Purchase Agreement

S-10

 

ATLANTIC ASSET SECURITIZATION LLC’S

      PURCHASER GROUP:

	 	 	 	 	 
	 	CALYON NEW YORK BRANCH,

as Purchaser Agent for the Atlantic Purchaser 

Group

 	 
	 	By:  	/s/ Kostantina Kourmpetis
 	 
	 	 	Name:  	Kostantina Kourmpetis 	 
	 	 	Title:  	Managing Director 	 
	 
	 	 	 
	 	By:  	                                              /s/ Blake Wright
 	 
	 	 	Name:  	Blake Wright 	 
	 	 	Title:  	Managing Director 	 
	 

	 	 	 	 	 
	 

	 	Address:
	 	Calyon New York Branch
	 

	 	 	 	1301 Avenue of the Americas
	 

	 	 	 	New York, NY 10019
	 

	 	Attention:
	 	Debt Capital Markets-Securitization
	 

	 	Telephone:
	 	212-261-3894
	 

	 	Facsimile:
	 	212-459-3528
	 

	 	 
	 	 
	 	 	Group Commitment: $100,000,000

Amended and Restated

Receivables Purchase Agreement

S-11

 

	 	 	 	 	 
	 	CALYON NEW YORK BRANCH,

as Related Committed Purchaser
 	 
	 
	 	By:  	/s/ Kostantina Kourmpetis
 	 
	 	 	Name:  	Kostantina Kourmpetis 	 
	 	 	Title:  	Managing Director 	 
	 
	 	 	 
	 	By:  	                                              /s/ Blake Wright
 	 
	 	 	Name:  	Blake Wright 	 
	 	 	Title:  	Managing Director 	 
	 

	 	 	 	 	 	 	 
	 

	 	Address:
	 	Calyon New York Branch	 	 
	 

	 	 	 	1301 Avenue of the Americas	 	 
	 

	 	 	 	New York, NY 10019	 	 
	 

	 	Attention:
	 	Debt Capital Markets-Securitization	 	 
	 

	 	Telephone:
	 	212-261-3894	 	 
	 

	 	Facsimile:
	 	212-459-3528	 	 
	 
	 	 	 	 	 	 
	 	 	With a copy to its Purchaser Agent
	 
	 	 	 	 	 	 
	 	 	Commitment: $100,000,000

Amended and Restated

Receivables Purchase Agreement

S-12

 

	 	 	 	 	 
	 	ATLANTIC ASSET SECURITIZATION LLC,

as Conduit Purchaser
 	 
	 
	 	By:  	/s/ Kostantina Kourmpetis
 	 
	 	 	Name:  	Kostantina Kourmpetis 	 
	 	 	Title:  	Managing Director 	 
	 
	 	 	 
	 	By:  	                                              /s/ Blake Wright
 	 
	 	 	Name:  	Blake Wright 	 
	 	 	Title:  	Managing Director 	 
	 

	 	 	 	 	 	 	 
	 

	 	Address:
	 	Atlantic Asset Securitization	 	 
	 

	 	 	 	c/o Calyon New York Branch	 	 
	 

	 	 	 	1301 Avenue of the Americas	 	 
	 

	 	 	 	New York, NY 10019	 	 
	 

	 	Attention:
	 	Debt Capital Markets-Securitization	 	 
	 

	 	Telephone:
	 	212-261-3894	 	 
	 

	 	Facsimile:
	 	212-459-3528	 	 
	 
	 	 	 	 	 	 
	 	 	With a copy to its Purchaser Agent

Amended and Restated

Receivables Purchase Agreement

S-13

 

	 	 	 	 	 
	 	CALYON NEW YORK BRANCH,

as an LC Participant
 	 
	 
	 	By:  	/s/ Kostantina Kourmpetis
 	 
	 	 	Name:  	Kostantina Kourmpetis 	 
	 	 	Title:  	Managing Director 	 
	 
	 	 	 
	 	By:  	                                              /s/ Blake Wright
 	 
	 	 	Name:  	Blake Wright 	 
	 	 	Title:  	Managing Director 	 
	 

	 	 	 	 	 	 	 
	 

	 	Address:
	 	Calyon New York Branch	 	 
	 

	 	 	 	1301 Avenue of the Americas	 	 
	 

	 	 	 	New York, NY 10019	 	 
	 

	 	Attention:
	 	Debt Capital Markets-Securitization	 	 
	 

	 	Telephone:
	 	212-261-3894	 	 
	 

	 	Facsimile:
	 	212-459-3528	 	 
	 
	 	 	 	 	 	 
	 	 	Commitment: $100,000,000
	 	 	Pro-Rata Share: 36.36%

Amended and Restated

Receivables Purchase Agreement

S-14

 

THE ADMINISTRATOR:

	 	 	 	 	 
	 	PNC BANK, NATIONAL ASSOCIATION,

as Administrator
 	 
	 
	 	By:  	/s/ William Falcon
 	 
	 	 	Name:  	William Falcon 	 
	 	 	Title:  	Vice President 	 
	 

	 	 	 	 	 	 	 
	 

	 	Address:
	 	PNC Bank, National Association
	 

	 	 	 	One PNC Plaza, 26th Floor
	 

	 	 	 	249 Fifth Avenue
	 

	 	 	 	Pittsburgh, PA 15222-2707
	 

	 	Attention:
	 	William Falcon
	 

	 	Telephone:
	 	412-762-5442
	 

	 	Facsimile:
	 	412-762-9184

Amended and Restated

Receivables Purchase Agreement

S-15

 

EXHIBIT I

DEFINITIONS

     As used in the Agreement (including its Exhibits, Schedules and Annexes), the following terms
shall have the following meanings (such meanings to be equally applicable to both the singular and
plural forms of the terms defined). Unless otherwise indicated, all Section, Annex, Exhibit and
Schedule references in this Exhibit are to Sections of and Annexes, Exhibits and Schedules to the
Agreement.

     “Adjusted LC Participation Amount” means, at any time, the LC Participation Amount
less the amount of cash collateral held in the LC Collateral Account at such time.

     “Administration Account” means the account number 1002422076 of the Administrator
maintained at the office of PNC at One PNC Plaza, 249 Fifth Avenue, Pittsburgh, Pennsylvania
15222-2707, or such other account as may be so designated in writing by the Administrator to the
Servicer.

     “Administrator” has the meaning set forth in the preamble to the Agreement.

     “Adverse Claim” means a lien, security interest or other charge or encumbrance, or any
other type of preferential arrangement; it being understood that any thereof in favor of, or
assigned to, the Administrator (for the benefit of the Purchasers) shall not constitute an Adverse
Claim.

     “Affected Person” has the meaning set forth in Section 1.9 of the Agreement.

     “Affiliate” means, as to any Person: (a) any Person that, directly or indirectly, is
in control of, is controlled by or is under common control with such Person, or (b) who is a
director or officer: (i) of such Person or (ii) of any Person described in clause (a),
except that, with respect to each Conduit Purchaser, Affiliate shall mean the holder(s) of its
capital stock or membership interests, as the case may be. For purposes of this definition,
control of a Person shall mean the power, direct or indirect: (x) to vote 25% or more of the
securities having ordinary voting power for the election of directors or managers of such Person,
or (y) to direct or cause the direction of the management and policies of such Person, in either
case whether by ownership of securities, contract, proxy or otherwise.

     “Aggregate Capital” means at any time the aggregate outstanding Capital of all
Purchasers at such time.

     “Aggregate Discount” at any time, means the sum of the aggregate for each Purchaser of
the accrued and unpaid Discount with respect to each such Purchaser’s Capital at such time.

     “Agreement” has the meaning set forth in the preamble to the Agreement.

     “Alternate Rate” for any Settlement Period for any Portion of Capital means an
interest rate per annum equal to: (a) 3.25% per annum above the Euro-Rate for such Settlement
Period or, in the sole discretion of the applicable Purchaser, (b) the Base Rate for such
Settlement Period; provided, that the “Alternate Rate” for any day while a Termination
Event exists shall be

I-1

 

an interest rate equal to the greater of (i) 3.00% per annum above the Base Rate in effect on
such day and (ii) the “Alternate Rate” as calculated in clause (a) above.

     “Assumption Agreement” means an agreement substantially in the form set forth in
Annex F to this Agreement.

     “Attorney Costs” means and includes all reasonable fees and disbursements of any law
firm or other external counsel.

     “Bankruptcy Code” means the United States Bankruptcy Reform Act of 1978 (11 U.S.C. §
101, et seq.), as amended from time to time.

     “Base Rate” means, for any day, a fluctuating interest rate per annum as shall be in
effect from time to time, which rate shall be at all times equal to the higher of:

     (a) the rate of interest in effect for such day as publicly announced from time to time
by the applicable Purchaser Agent (or the applicable Related Committed Purchaser or, in the
case of determining the Base Rate for purposes of calculating the Yield Reserve, the
Administrator) as its “reference rate” or “prime rate”, as applicable. Such “reference
rate” (or “prime rate”, as applicable) is set by the applicable Purchaser Agent (or the
applicable Related Committed Purchaser or the Administrator) based upon various factors,
including the applicable Purchaser Agent’s (or the applicable Related Committed Purchaser’s
or the Administrator’s) costs and desired return, general economic conditions and other
factors, and is used as a reference point for pricing some loans, which may be priced at,
above or below such announced rate; and

     (b) 0.50% per annum above the latest Federal Funds Rate.

     “Base Rate Portion of Capital” shall mean a Portion of Capital, the Discount with
respect to which is calculated at a per annum rate based on the interest rate
determined by reference to the Base Rate.

     “BBA” means the British Bankers’ Association.

     “Benefit Plan” means any employee benefit pension plan as defined in Section 3(2) of
ERISA in respect of which the Seller, any Originator, Peabody or any ERISA Affiliate is, or at any
time during the immediately preceding six years was, an “employer” as defined in Section 3(5) of
ERISA.

     “Business Day” means any day (other than a Saturday or Sunday) on which: (a) banks
are not authorized or required to close in New York City, New York, or Pittsburgh, Pennsylvania and
(b) if this definition of “Business Day” is utilized in connection with the Euro-Rate, dealings are
carried out in the London interbank market.

     “Capital” means, with respect to any Purchaser, the aggregate amount paid to (or for
the benefit of) the Seller in respect of Investments by such Purchaser (including, without
limitation, pursuant to Section 1.4(f)), as reduced from time to time by Collections
distributed and applied on account of such Capital pursuant to Section 1.6(d) of the
Agreement; provided, that if such

I-2

 

Capital shall have been reduced by any distribution and thereafter all or a portion of such
distribution is rescinded or must otherwise be returned for any reason, such Capital shall be
increased by the amount of such rescinded or returned distribution as though it had not been made.

     “Change in Control” means (a) Peabody ceases to own, directly or indirectly, 100% of
the membership interests of the Seller free and clear of all Adverse Claims; (b) a “Change in
Control” (as defined in the Senior Notes Indenture as in effect on September 30, 2005); (c) with
respect to any Material Originator, Peabody ceases to be the beneficial owner (as defined in Rules
13(d)-3 and 13(d)-5 under the Securities Exchange Act of 1934, as amended), directly or indirectly,
of at least 75% of the outstanding shares of voting securities of such Material Originator without
the prior written consent of the Administrator, such consent not to be unreasonably withheld; or
(d) Peabody ceases to have beneficial ownership (as defined in clause (c)), directly or indirectly,
of 100% of the outstanding shares of voting securities of Peabody Holding Company, LLC.

     “Closing Date” means January 25, 2010.

     “Collateral” shall have the meaning set forth in Section 1.1 of the Sale
Agreement.

     “Collections” means, with respect to any Pool Receivable: (a) all funds that are
received by any Originator, Peabody, the Seller or the Servicer in payment of any amounts owed in
respect of such Receivable (including purchase price, finance charges, interest and all other
charges), or applied to amounts owed in respect of such Receivable (including insurance payments
and net proceeds of the sale or other disposition of repossessed goods or other collateral or
property of the related Obligor or any other Person directly or indirectly liable for the payment
of such Pool Receivable and available to be applied thereon), (b) all amounts deemed to have been
received pursuant to Section 1.6(e) of the Agreement and (c) all other proceeds of such
Pool Receivable.

     “Commitment” means, with respect to any Related Committed Purchaser, LC Participant or
LC Bank, as applicable, the maximum aggregate amount which such Purchaser is obligated to pay
hereunder on account of all Investments and all drawings under all Letters of Credit, on a combined
basis, as set forth below its signature to this Agreement or in the Assumption Agreement or other
agreement pursuant to which it became a Purchaser, as such amount may be modified in connection
with any subsequent assignment pursuant to Section 5.3(c) or in connection with a change in
the Purchase Limit pursuant to Section 1.1(c). As the context so requires, “Commitment”
with respect to any Related Committed Purchaser, LC Participant or LC Bank, as applicable, shall
also be deemed to include such Related Committed Purchaser’s, LC Participant’s or LC Bank’s
obligation hereunder to make Investments, Reinvestments or participation advances to the LC Bank
or, in the case of the LC Bank, to issue Letters of Credit, as applicable, on the terms and subject
to the conditions set forth herein.

     “Commitment Percentage” means, for each Related Committed Purchaser or related LC
Participant in a Purchaser Group, the Commitment of such Related Committed Purchaser or related LC
Participant, as the case may be, divided by the total of all Commitments of all Related Committed
Purchasers or related LC Participants, as the case may be, in such Purchaser Group.

I-3

 

     “Company Note” has the meaning set forth in Section 3.1 of the Sale Agreement.

     “Concentration Percentage” means: (a) for any Group A Obligor, 15%, (b) for any
Group B Obligor, 7.5%, (c) for any Group C Obligor, 5.0% and (d) for any Group D Obligor, 3.0%.

     “Concentration Reserve” means the product of (a) the Aggregate Capital plus the LC
Participation Amount, and (b)(i) the Concentration Reserve Percentage divided by (ii) 1 minus the
Concentration Reserve Percentage.

     “Concentration Reserve Percentage” means the (a) largest of the following (i) the sum
of the five (5) largest Group D Obligor Receivables balances (up to the Concentration Percentage
for each Obligor), (ii) the sum of the three (3) largest Group C Obligor Receivables balances (up
to the Concentration Percentage for each Obligor), (iii) the sum of the two (2) largest Group B
Obligor Receivables balances (up to the Concentration Percentage for each Obligor), and (iv) the
one (1) largest Group A Obligor Receivables balance (up to the Concentration Percentage for such
Obligor), divided by (b) the Eligible Receivables.

     “Conduit Purchaser” means each commercial paper conduit that is a party to this
Agreement, as a purchaser, or that becomes a party to this Agreement, as a purchaser pursuant to an
Assumption Agreement or otherwise.

     “Contract” means, with respect to any Receivable, any and all contracts, instruments,
agreements, leases, invoices, notes or other writings pursuant to which such Receivable arises or
that evidence such Receivable or under which an Obligor becomes or is obligated to make payment in
respect of such Receivable.

     “Contributed Assets” has the meaning set forth in Section 1.1 of the
Contribution Agreement.

     “Contribution Agreement” means that certain Contribution Agreement dated as of
February 20, 2002 by and between the Contributor and the Seller, as the same may be amended from
time to time.

     “Contribution Indemnified Amounts” has the meaning set forth in Section 7.1 of
the Contribution Agreement.

     “Contribution Indemnified Party” has the meaning set forth in Section 7.1 of
the Contribution Agreement.

     “Contribution Termination Date” has the meaning set forth in Section 1.3 of
the Contribution Agreement.

     “Contribution Termination Event” has the meaning set forth in Section 6.1 of
the Contribution Agreement.

     “Contributor” means Peabody Energy Corporation, a Delaware corporation.

I-4

 

     “CP Rate” means, for any Conduit Purchaser and for any Settlement Period for any
Portion of Capital, (a) the per annum rate equivalent to the weighted average cost
(as determined by the applicable Purchaser Agent and which shall include commissions of placement
agents and dealers, incremental carrying costs incurred with respect to Notes of such Person
maturing on dates other than those on which corresponding funds are received by such Conduit
Purchaser, other borrowings by such Conduit Purchaser (other than under any Program Support
Agreement) and any other costs associated with the issuance of Notes) of or related to the issuance
of Notes that are allocated, in whole or in part, by the applicable Purchaser Agent to fund or
maintain such Portion of Capital (and which may be also allocated in part to the funding of other
assets of such Conduit Purchaser); provided, that if any component of such rate is a
discount rate, in calculating the “CP Rate” for such Portion of Capital for such Settlement
Period, the applicable Purchaser Agent shall for such component use the rate resulting from
converting such discount rate to an interest bearing equivalent rate per annum;
provided, further, that notwithstanding anything in the Agreement or the other
Transaction Documents to the contrary, the Seller agrees that any amounts payable to the Purchasers
in respect of Discount for any Settlement Period with respect to any Portion of Capital funded by
such Purchaser at the CP Rate shall include an amount equal to the portion of the face amount of
the outstanding Notes issued to fund or maintain such Portion of Capital that corresponds to the
portion of the proceeds of such Notes that was used to pay the interest component of maturing Notes
issued to fund or maintain such Portion of Capital, to the extent that such Purchaser had not
received payments of interest in respect of such interest component prior to the maturity date of
such maturing Notes (for purposes of the foregoing, the “interest component” of Notes equals the
excess of the face amount thereof over the net proceeds received by such Purchaser from the
issuance of Notes, except that if such Notes are issued on an interest-bearing basis its “interest
component” will equal the amount of interest accruing on such Notes through maturity) or (b) any
other rate designated as the “CP Rate” for such Conduit Purchaser in an Assumption Agreement or
Transfer Supplement pursuant to which such Person becomes a party as a Conduit Purchaser to this
Agreement, or any other writing or agreement provided by such Conduit Purchaser to the Seller, the
Servicer and the applicable Purchaser Agent from time to time. Notwithstanding the foregoing, the
“CP Rate” for any day while a Termination Event exists shall be an interest rate equal to the
greater of (i) 3.00% above the Base Rate in effect on such day and (ii) the Alternate Rate as
calculated in the definition thereof.

     “Credit Agreement” means that certain Third Amended and Restated Credit Agreement,
dated as of September 15, 2006, among Peabody, as borrower, the several lenders from time to time
parties thereto, Bank of America Securities, LLC and Citigroup Global Markets, Inc., as arrangers,
the various other parties thereto, and Bank of America, N.A., as administrative agent, and shall
include, except as otherwise expressly provided herein, such agreement as amended, restated and/or
otherwise modified from time to time in accordance with the terms thereof, and any extension,
replacement, substitution, and/or refinancing thereof.

     “Credit and Collection Policy” means, as the context may require, those receivables
credit and collection policies and practices of the Originators in effect on the date of the
Agreement and described in Schedule I to the Agreement, as modified in compliance with the
Agreement.

     “Cut-off Date” has the meaning set forth in the Sale Agreement.

I-5

 

     “Days’ Sales Outstanding” means, at any time, an amount computed as of the last day of
each calendar month equal to: (a) the average of the Outstanding Balance of all Pool Receivables
as of the last day of each of the three most recent calendar months ended on the last day of such
calendar month divided by (b) (i) the aggregate credit sales made by the Originators during the
three calendar months ended on or before the last day of such calendar month divided by (ii) 90.

     “Debt” means: (a) indebtedness for borrowed money, (b) obligations evidenced by
bonds, debentures, notes or other similar instruments, (c) obligations to pay the deferred purchase
price of property or services, (d) obligations as lessee under leases that shall have been or
should be, in accordance with generally accepted accounting principles, recorded as capital leases,
and (e) obligations under direct or indirect guaranties in respect of, and obligations (contingent
or otherwise) to purchase or otherwise acquire, or otherwise to assure a creditor against loss in
respect of, indebtedness or obligations of others of the kinds referred to in clauses (a)
through (d) above.

     “Declining Conduit Purchaser” has the meaning set forth in Section 1.6(b)(ii)
of the Agreement.

     “Declining Notice” has the meaning set forth in Section 1.6(b)(ii) of the
Agreement.

     “Defaulted Receivable” means a Receivable:

     (a) as to which any payment, or part thereof, remains unpaid for more than 60
days from the due date for such payment (which shall be determined without regard to
any credit memos or credit balances available to the Obligor); provided,
that, any Receivable the related Obligor of which is TVA that would
otherwise have become a Defaulted Receivable pursuant to this clause (a)
during the calendar month of March 2007 shall not be deemed a Defaulted Receivable,
or

     (b) without duplication (i) as to which an Insolvency Proceeding shall have
occurred with respect to the Obligor thereof or any other Person obligated thereon
or owning any Related Security with respect thereto, or (ii) that has been written
off the Seller’s books as uncollectible.

     “Default Ratio” means the ratio (expressed as a percentage and rounded to the nearest
1/100 of 1%, with 5/1000th of 1% rounded upward) computed as of the last day of each calendar month
by dividing: (a) the aggregate Outstanding Balance of all Pool Receivables that became Defaulted
Receivables during such month (other than Receivables that became Defaulted Receivables as a result
of an Event of Bankruptcy with respect to the Obligor thereof during such month), by (b) the
aggregate credit sales made by the Originators during the month that is three calendar months
before such month.

     “Deferred Purchase Price” has the meaning set forth in Section 1.4(c) of the
Agreement.

     “Delinquency Ratio” means the ratio (expressed as a percentage and rounded to the
nearest 1/100 of 1%, with 5/1000th of 1% rounded upward) computed as of the last day of each
calendar month by dividing: (a) the aggregate Outstanding Balance of all Pool Receivables that

I-6

 

were Delinquent Receivables on such day by (b) the aggregate Outstanding Balance of all Pool
Receivables on such day.

     “Delinquent Receivable” means a Receivable as to which any payment, or part thereof,
remains unpaid for more than 60 days from the due date for such payment.

     “Dilution Horizon” means, for any calendar month, the ratio (expressed as a percentage
and rounded to the nearest 1/100th of 1%, with 5/l000th of 1% rounded upward) computed as of the
last day of such calendar month of: (a) the aggregate credit sales made by the Originators during
the two most recent calendar months to (b) the Net Receivables Pool Balance at the last day of the
most recent calendar month.

     “Dilution Ratio” means the ratio (expressed as a percentage and rounded to the nearest
1/100th of 1%, with 5/1000th of 1% rounded upward), computed as of the last day of each calendar
month by dividing: (a) the aggregate amount of payments required to be made by the Seller pursuant
to Section 1.6(e)(i) of the Agreement during such calendar month by (b) the aggregate
credit sales made by the Originators during the month that is one month prior to the current month.

     “Dilution Reserve” means, on any date, an amount equal to: (a) the sum of the
Aggregate Capital plus the LC Participation Amount at the close of business of the Seller on such
date multiplied by (b) (i) the Dilution Reserve Percentage on such date, divided by
(ii) 100% minus the Dilution Reserve Percentage on such date.

     “Dilution Reserve Percentage” means on any date, the product of (i) the Dilution
Horizon multiplied by (ii) the sum of (x) 2.25 times the average of the Dilution
Ratio for the twelve most recent calendar months and (y) the Spike Factor.

     “Discount” means, with respect to any Purchaser:

     (a) for any Portion of Capital of such Purchaser for any Settlement Period to the
extent such Purchaser will be funding such Portion of Capital during such Settlement Period
through the issuance of Notes:

CPR x C x ED/360

     (b) for any Portion of Capital of such Purchaser for any Settlement Period to the
extent such Purchaser will not be funding such Portion of Capital during such Settlement
Period through the issuance of Notes or, to the extent the LC Bank and/or any LC Participant
has made an Investment in connection with any drawing under a Letter of Credit, which
Investment accrues Discount pursuant to Section 1.4(f) of the Agreement:

AR x C x ED/Year + TF

     where:

	 	 	 	 	 	 	 
	 

	 	AR
	 	=
	 	the Alternate Rate for such Portion of Capital for such
Settlement Period,

I-7

 

	 	 	 	 	 	 	 
	 

	 	C
	 	=
	 	such Portion of Capital during such Settlement Period,
	 

	 	 
	 	 
	 	 
	 

	 	CPR
	 	=
	 	the CP Rate for such Portion of Capital for such Settlement
Period,
	 

	 	 
	 	 
	 	 
	 

	 	ED
	 	=
	 	the actual number of days during such Settlement Period,
	 

	 	 
	 	 
	 	 
	 

	 	Year
	 	=
	 	if such Portion of Capital is funded based upon: (i) the
Euro-Rate, 360 days, and (ii) the Base Rate, 365 or 366 days, as applicable,
and
	 

	 	 
	 	 
	 	 
	 

	 	TF
	 	=
	 	the Termination Fee, if any, for the Portion of Capital for
such Settlement Period;

provided, that no provision of the Agreement shall require the payment or permit the
collection of Discount in excess of the maximum permitted by applicable law; and provided
further, that Discount for any Portion of Capital shall not be considered paid by any
distribution to the extent that at any time all or a portion of such distribution is rescinded or
must otherwise be returned for any reason.

     “Drawing Date” has the meaning set forth in Section 1.16 of the Agreement.

     “Eligible Assignee” means any bank or financial institution acceptable to the LC Bank
and the Administrator.

     “Eligible Receivable” means, at any time, a Pool Receivable:

     (a) the Obligor of which is (i) a United States resident or if such Obligor is not a
United States resident: (A) such Pool Receivable must result from goods sold and shipped
from the Originator in the United States and payment for such goods must be denominated and
payable only in U.S. dollars and payable to an Originator at a Lock-Box Account, (B) if such
Obligor is a resident of Canada, the total of all Eligible Receivables the Obligors of which
are Canadian residents does not exceed 3% (or, if at any time the foreign currency rating of
Canada falls below A by Standard & Poor’s or A2 by Moody’s, 2%) of all Eligible Receivables
and (C) if such Obligor is neither a U.S. nor a Canadian resident, the total of all Eligible
Receivables the Obligors of which are both non-U.S. and non-Canadian residents does not
exceed 5% of all Eligible Receivables, (ii) not a government or a governmental subdivision,
affiliate or agency, except that up to 3% of all Eligible Receivables may consist of
Receivables the Obligors of which are governments, governmental subdivisions, affiliates or
agencies, provided, however, that TVA shall not be subject to the
restrictions of this subsection (ii), (iii) not subject to any action of the type described
in paragraph (f) of Exhibit V to the Agreement, (iv) not an Affiliate of Peabody or
any other Originator, and (v) not an Obligor as to which the Administrator, in its
reasonable business judgment, has notified the Seller that such Obligor is not acceptable,

     (b) that is denominated and payable only in U.S. dollars in the United States to the
Originator at a Lockbox Account,

I-8

 

     (c) that does not have a stated maturity which is more than 60 days after the original
invoice date of such Receivable,

     (d) that arises under a duly authorized Contract for the sale and delivery of goods or
services in the ordinary course of the Originator’s business,

     (e) that arises under a duly authorized Contract that is in full force and effect and
that is a legal, valid and binding obligation of the related Obligor, enforceable against
such Obligor in accordance with its terms,

     (f) that conforms in all material respects with all applicable laws, rulings and
regulations in effect,

     (g) that is not the subject of any asserted dispute, offset, hold back defense, Adverse
Claim or other claim, provided, that, with respect to any Receivable which is subject to any
such a claim, the amount of such Receivable which shall be treated as an Eligible Receivable
shall equal the excess of the amount of such Receivable over the amount of such claim
asserted by or available to the account party or other obligor,

     (h) that satisfies all applicable requirements of the applicable Credit and Collection
Policy,

     (i) that has not been modified, waived or restructured since its creation, except as
permitted pursuant to Section 4.2 of the Agreement,

     (j) in which the Seller owns good and marketable title, free and clear of any Adverse
Claims, and that is freely assignable by the Seller (including without any consent of the
related Obligor),

     (k) for which the Administrator (on behalf of the Purchasers) shall have a valid and
enforceable ownership or security interest and a valid and enforceable first priority
perfected ownership or security interest therein and in the Related Security and Collections
with respect thereto, in each case free and clear of any Adverse Claim,

     (l) that constitutes an account as defined in the UCC, and that is not evidenced by
instruments or chattel paper,

     (m) that is neither a Defaulted Receivable nor a Delinquent Receivable,

     (n) for which neither the Originator thereof, the Seller nor the Servicer has
established any offset arrangements with the related Obligor,

     (o) for which Defaulted Receivables of the related Obligor do not exceed 25% of the
Outstanding Balance of all such Obligor’s Receivables,

     (p) that represents amounts earned and payable by the Obligor that are not subject to
the performance of additional services by the Originator thereof,

I-9

 

          (q) that is not a Receivable considered to be a “quality accrual” (as reported on the
monthly Information Package), except that up to 5% of Eligible Receivables may be “quality
accruals”, and

          (r) the Obligor of which is not the Mohave Project.

     “ERISA” means the Employee Retirement Income Security Act of 1974, as amended from
time to time, and any successor statute of similar import, together with the regulations
thereunder, in each case as in effect from time to time. References to sections of ERISA also
refer to any successor sections.

     “ERISA Affiliate” means: (a) any corporation that is a member of the same controlled
group of corporations (within the meaning of Section 414(b) of the Internal Revenue Code) as the
Seller, any Originator or Peabody, (b) a trade or business (whether or not incorporated) under
common control (within the meaning of Section 414(c) of the Internal Revenue Code) with the Seller,
any Originator or Peabody, or (c) a member of the same affiliated service group (within the meaning
of Section 414(m) of the Internal Revenue Code) as the Seller, any Originator, any corporation
described in clause (a) or any trade or business described in clause (b).

     “Euro-Rate” means with respect to any Settlement Period the interest rate per annum
determined by the applicable Purchaser Agent by dividing (the resulting quotient rounded upwards,
if necessary, to the nearest 1/100th of 1% per annum) (i) the rate of interest determined by such
Purchaser Agent in accordance with its usual procedures (which determination shall be conclusive
absent manifest error) to be the average of the London interbank market offered rates for U.S.
dollars quoted by the BBA as set forth on Dow Jones Markets Service (formerly known as Telerate)
(or appropriate successor or, if the BBA or its successor ceases to provide display page 3750 (or
such other display page on the Dow Jones Markets Service system as may replace display page 3750)
at or about 11:00 a.m. (London time) on the Business Day which is two (2) Business Days prior to
the first day of such Settlement Period for an amount comparable to the Portion of Capital to be
funded at the Alternate Rate and based upon the Euro-Rate during such Settlement Period by (ii) a
number equal to 1.00 minus the Euro-Rate Reserve Percentage. The Euro-Rate may also be expressed
by the following formula:

	 	 	 	 	 
	 

	 	Euro-Rate =
	 	Average of London interbank offered rates quoted
by BBA as shown on Dow Jones Markets Service
display page 3750 or appropriate successor
	 

	 	 
	 	 
	 

	 	 
	 	1.00 — Euro-Rate
Reserve Percentage

where “Euro-Rate Reserve Percentage” means, the maximum effective percentage in effect on
such day as prescribed by the Board of Governors of the Federal Reserve System (or any successor)
for determining the reserve requirements (including without limitation, supplemental, marginal, and
emergency reserve requirements) with respect to eurocurrency funding (currently referred to as
“Eurocurrency Liabilities”). The Euro-Rate shall be adjusted with respect to any Portion
of Capital funded at the Alternate Rate and based upon the Euro-Rate that is outstanding on the
effective date of any change in the Euro-Rate Reserve Percentage as of such effective date. The
applicable Purchaser Agent shall give prompt notice to the Seller of the Euro-Rate as

I-10

 

determined or adjusted in accordance herewith (which determination shall be conclusive absent
manifest error).

     “Event of Bankruptcy” means (a) any case, action or proceeding before any court or
other governmental authority relating to bankruptcy, reorganization, insolvency, liquidation,
receivership, dissolution, winding-up or relief of debtors or (b) any general assignment for the
benefit of creditors of a Person or any composition, marshalling of assets for creditors of a
Person, or other similar arrangement in respect of its creditors generally or any substantial
portion of its creditors; in each of cases (a) and (b) undertaken under U.S. Federal, state or
foreign law, including the Bankruptcy Code.

     “Excess Concentration” means the sum of the amounts by which the Outstanding Balance
of Eligible Receivables of each Obligor then in the Receivables Pool exceeds an amount equal to:
(a) the Concentration Percentage for such Obligor multiplied by (b) the Outstanding Balance of all
Eligible Receivables then in the Receivables Pool.

     “Exiting Notice” has the meaning set forth in Section 1.6(b)(ii) of the
Agreement.

     “Exiting Purchaser” has the meaning set forth in Section 1.6(b)(ii) of the
Agreement.

     “Facility Termination Date” means the earliest to occur of: (a) with respect to each
Purchaser, May 12, 2012, subject to any extension thereof pursuant to Section 1.12, (b) the
date determined pursuant to Section 2.2 of the Agreement, (c) the date the Purchase Limit
reduces to zero pursuant to Section 1.1(c) of the Agreement, (d) with respect to each
Purchaser Group, the date on which the commitments of the Liquidity Banks under the related
Liquidity Agreement terminate, it being understood that, as of the Closing Date, the termination
date of such commitments for Market Street Funding LLC’s and Atlantic Asset Securitization LLC’s
Purchaser Groups are scheduled to occur on May 11, 2010, subject to any extension thereof pursuant
to Section 1.12, (e) with respect to each Purchaser Group, the date that the commitment of
all of the Related Committed Purchasers of such Purchaser Group terminate pursuant to Section
1.12 and (f) the Seller shall fail to cause the amendment or modification of any Transaction
Document or related opinion as required by Moody’s or Standard & Poor’s, and such failure shall
continue for 30 days after such amendment is initially requested.

     “Federal Funds Rate” means, for any day, the per annum rate set forth in the weekly
statistical release designated as H.15(519), or any successor publication, published by the Federal
Reserve Board (including any such successor, “H.15(519)”) for such day opposite the caption
“Federal Funds (Effective).” If on any relevant day such rate is not yet published in H. 15(519),
the rate for such day will be the rate set forth in the daily statistical release designated as the
Composite 3:30 p.m. Quotations for U.S. Government Securities, or any successor publication,
published by the Federal Reserve Bank of New York (including any such successor, the “Composite
3:30 p.m. Quotations”) for such day under the caption “Federal Funds Effective Rate.” If on any
relevant day the appropriate rate is not yet published in either H.15(519) or the Composite 3:30
p.m. Quotations, the rate for such day will be the arithmetic mean as determined by the
Administrator of the rates for the last transaction in overnight Federal funds arranged before 9:00
a.m. (New York time) on that day by each of three leading brokers of Federal funds transactions in
New York City selected by the Administrator.

I-11

 

     “Federal Reserve Board” means the Board of Governors of the Federal Reserve System, or
any entity succeeding to any of its principal functions.

     “Fee Letters” has the meaning set forth in Section 1.7 of the Agreement.

     “Fees” means the fees payable by the Seller pursuant to the Fee Letters. For the
avoidance of doubt, “Fees” excludes any Servicing Fees.

     “Final Payout Date” means the date on or after the Facility Termination Date on which
(i) the Purchase Limit and all Commitments have been reduced to zero ($0), (ii) the Aggregate
Capital has been reduced to zero ($0), (iii) the Aggregate Discount has been paid in full, (iv) all
accrued Fees have been paid in full, (v) the Adjusted LC Participation Amount has been reduced to
zero ($0) and (vi) all other amounts owing by the Seller and the Servicer to the Administrator, the
Purchaser Agents, the Purchasers, the Indemnified Parties and the other Affected Persons hereunder
and under the other Transaction Documents have been paid in full.

     “Governmental Authority” means any nation or government, any state or other political
subdivision thereof, any central bank (or similar monetary or regulatory authority) thereof, any
body or entity exercising executive, legislative, judicial, regulatory or administrative functions
of or pertaining to government, including any court, and any Person owned or controlled, through
stock or capital ownership or otherwise, by any of the foregoing.

     “Group A Obligor” means any Obligor with a short-term rating of at least: (a) “A1” by
Standard & Poor’s, or if such Obligor does not have a short-term rating from Standard & Poor’s, a
rating of “A+” or better by Standard & Poor’s on its long-term senior unsecured and
uncredit-enhanced debt securities, and (b) “P-1” by Moody’s, or if such Obligor does not
have a short-term rating from Moody’s, “Al” or better by Moody’s on its long-term senior unsecured
and uncredit-enhanced debt securities, and any Special Group A Obligor.

     “Group B Obligor” means an Obligor, not a Group A Obligor, with a short-term rating of
at least: (a) “A-2” by Standard & Poor’s, or if such Obligor does not have a short-term rating
from Standard & Poor’s, a rating of “BBB+” to “A” by Standard & Poor’s on its long-term senior
unsecured and uncredit-enhanced debt securities, and (b) “P-2” by Moody’s, or if such
Obligor does not have a short-term rating from Moody’s, “Baal” to “A2” by Moody’s on its long-term
senior unsecured and uncredit-enhanced debt securities, and any Special Group B Obligor.

     “Group C Obligor” means an Obligor, not a Group A Obligor or a Group B Obligor, with a
short-term rating of at least: (a) “A-3” by Standard & Poor’s, or if such Obligor does not have a
short-term rating from Standard & Poor’s, a rating of “BBB-” to “BBB” by Standard & Poor’s on its
long-term senior unsecured and uncredit-enhanced debt securities, and (b) “P-3” by Moody’s,
or if such Obligor does not have a short-term rating from Moody’s, “Baa3” to “Baa2” by Moody’s on
its long-term senior unsecured and uncredit-enhanced debt securities, and any Special Group C
Obligor.

     “Group Capital” means with respect to any Purchaser Group, an amount equal to the
aggregate of all Capital of the Purchasers within such Purchaser Group.

I-12

 

     “Group Commitment” means with respect to any Purchaser Group the aggregate of the
Commitments of each Purchaser within such Purchaser Group, which amount is set forth on the related
Purchaser Agent’s signature page hereto; it being understood that any such Group Commitment may be
less than the sum of the Commitments of the Purchasers within the relevant Purchaser Group.

     “Group D Obligor” means any Obligor that is not a Group A Obligor, Group B Obligor or
Group C Obligor, and any Special Group D Obligor.

     “Indemnified Amounts” has the meaning set forth in Section 3.1 of the
Agreement.

     “Indemnified Party” has the meaning set forth in Section 3.1 of the Agreement.

     “Independent Director” has the meaning set forth in paragraph 3(c) of
Exhibit IV to the Agreement.

     “Information Package” means a report, in substantially the form of Annex A to
the Agreement, furnished to the Administrator and each Purchaser Agent pursuant to the Agreement.

     “Insolvency Proceeding” means: (a) any case, action or proceeding before any court or
other Governmental Authority relating to bankruptcy, reorganization, insolvency, liquidation,
receivership, dissolution, winding-up or relief of debtors, or (b) any general assignment for the
benefit of creditors of a Person, composition, marshaling of assets for creditors of a Person, or
other, similar arrangement in respect of its creditors generally or any substantial portion of its
creditors, in each of cases (a) and (b) undertaken under U.S. Federal, state or foreign law,
including the Bankruptcy Code.

     “Intercreditor Agreement” means that certain Intercreditor Agreement dated as of
February 20, 2002, by and between the Administrator and Bank One, NA, in its capacity as
administrative agent under the Credit Agreement, as such Intercreditor Agreement may be amended,
restated and/or otherwise modified from time to time in accordance with the terms thereof.

     “Internal Revenue Code” means the Internal Revenue Code of 1986, as amended from time
to time, and any successor statute of similar import, together with the regulations thereunder, in
each case as in effect from time to time. References to sections of the Internal Revenue Code also
refer to any successor sections.

     “Investment” has the meaning set forth in Section 1.1(a) of the Agreement.

     “Investment Date” means the date on which an Investment or a Reinvestment is made
pursuant to this Agreement.

     “Investment Notice” has the meaning set forth in Section 1.2(a) of this
Agreement.

     “ISP98 Rules” has the meaning set forth in Section 1.14 of the Agreement.

     “LC Bank” has the meaning set forth in the preamble to the Agreement.

I-13

 

     “LC Collateral Account” means the account designated as the LC Collateral Account
established and maintained by the Administrator (for the benefit of the LC Bank and the LC
Participants), or such other account as may be so designated as such by the Administrator.

     “LC Commitment” means the “Commitment” of each LC Participant party hereto as set
forth under its name on the signature pages to the Agreement or as set forth in any Assumption
Agreement pursuant to which it became a party hereto.

     “LC Participant” means each Person listed as such (and its respective Commitment) for
each Purchaser Group as set forth on the signature pages of this Agreement or in any Assumption
Agreement or Transfer Supplement.

     “LC Participation Amount” shall mean, at any time, the then aggregate face amount of
the outstanding Letters of Credit.

     “Letter of Credit” shall mean any stand-by letter of credit issued by the LC Bank for
the account of the Seller pursuant to the Agreement.

     “Letter of Credit Application” has the meaning set forth in Section 1.14 of
the Agreement.

     “Liquidity Agreement” means any agreement entered into in connection with this
Agreement pursuant to which a Liquidity Bank agrees to make purchases or advances to, or purchase
assets from, any Conduit Purchaser in order to provide liquidity for such Conduit Purchaser’s
Investments.

     “Liquidity Bank” means each bank or other financial institution that provides
liquidity support to any Conduit Purchaser pursuant to the terms of a Liquidity Agreement.

     “LLC Agreement” means the Second Amended and Restated Limited Liability Company
Agreement of P&L Receivables Company, LLC.

     “Lock-Box Account” means an account in the name of the Seller and maintained by the
Seller at a bank or other financial institution for the purpose of receiving Collections.

     “Lock-Box Agreement” means an agreement, in form and substance satisfactory to the
Administrator, among the Seller, the Servicer, the Administrator and a Lock-Box Bank.

     “Lock-Box Bank” means any of the banks or other financial institutions holding one or
more Lock-Box Accounts.

     “Loss Reserve” means, on any date, an amount equal to: (a) the sum of the Aggregate
Capital plus the LC Participation Amount at the close of business of the Seller on such date
multiplied by (b) (i) the Loss Reserve Percentage on such date divided by (ii) 100% minus the Loss
Reserve Percentage on such date.

     “Loss Reserve Percentage” means, on any date, the product of (i) 2.25 times (ii) the
highest average of the Default Ratios for any three consecutive calendar months during the

I-14

 

twelve most recent calendar months and (iii) (A) the aggregate credit sales made by the
Originators during the four most recent calendar months divided by (B) the Net Receivables Pool
Balance as of such date.

     “Majority LC Participants” means, at any time, LC Participants whose Pro Rata Shares
aggregate 51% or more.

     “Majority Purchaser Agents” means, at any time, the Purchaser Agents which in their
related Purchaser Group have Related Committed Purchasers whose Commitments aggregate more than 50%
of the aggregate of the Commitments of all Related Committed Purchasers in all Purchaser Groups;
provided, that so long as any one Related Committed Purchaser’s Commitment is greater than
50% of the aggregate Commitments and there is more than one Purchaser Group, then “Majority
Purchaser Agents” shall mean a minimum of two Purchaser Agents which in their related Purchaser
Group have Related Committed Purchasers whose Commitments aggregate more than 50% of the aggregate
Commitment of all Related Committed Purchasers in all Purchaser Groups.

     “Material Adverse Effect” means with respect to any event or circumstance, a material
adverse effect on:

     (a) the assets, operations, business or financial condition of (i) the Seller, or (ii)
Peabody and its Subsidiaries taken as a whole,

     (b) the ability of any of the Originators, the Contributor, the Servicer, any of the
Sub-Servicers, the Transferee or the Seller to perform its obligations under the Agreement
or any other Transaction Document to which it is a party,

     (c) the validity or enforceability of the Agreement or any other Transaction Document,
or the validity, enforceability or collectibility of a material portion of the Pool
Receivables, or

     (d) the status, perfection, enforceability or priority of the Administrator’s, the
Purchasers’ or the Seller’s interest in the Pool Assets.

     “Material Originator” means any of the following at any time, so long as such Person
is an Originator: (i) COALSALES II, LLC, a Delaware limited liability company, (ii) Powder River
Coal, LLC, a Delaware limited liability company, (iii) Peabody Western Coal Company, a Delaware
corporation, (iv) Peabody Midwest Mining, LLC, an Indiana limited liability company and (v) any
other Originator now or hereafter party to the Sale Agreement whose Receivables represent 15% or
more of the aggregate Receivables originated by the Originators in any calendar month during the
immediately preceding 12 Settlement Periods.

     “Member” shall have the meaning set forth in Schedule A to the LLC Agreement.

     “Mohave Project” means that certain joint venture that developed, built and operates
the Mohave Generating Station located in Laughlin, Nevada, which joint venture is owned by Southern
California Edison (56%), Nevada Power Company (14%), Salt River Project

I-15

 

Agricultural Improvement and Power District (10%), and Department of Water and Power of Los
Angeles (20%).

     “Monthly Settlement Date” means the twenty-third day of each calendar month (or the
next succeeding Business Day if such day is not a Business Day), beginning May 23, 2008.

     “Moody’s” means Moody’s Investors Service, Inc.

     “Navajo Project” means that certain joint venture that developed, built and operates
the Navajo Electric Generating Station located in Page, Arizona, which joint venture is owned by
Nevada Power Company, Salt River Project Agricultural Improvement and Power District, Department of
Water and Power of Los Angeles, Arizona Public Service Co., and Tucson Gas and Electric Co.

     “Net Receivables Pool Balance” means, at anytime: (a) the Outstanding Balance of
Eligible Receivables then in the Receivables Pool minus (b) Excess Concentration.

     “Notes” means short-term promissory notes issued, or to be issued, by any Conduit
Purchaser to fund its investments in accounts receivable or other financial assets.

     “Obligor” means, with respect to any Receivable, the Person obligated to make payments
pursuant to the Contract relating to such Receivable.

     “Obligor Group” means any of the following: Group A Obligor, Group B Obligor, Group C
Obligor or Group D Obligor.

     “Order” has the meaning set forth in Section 1.22 of the Agreement.

     “Original Agreement” has the meaning set forth in the preliminary statements of the
Agreement.

     “Original Agreement Outstanding Amounts” has the meaning set forth in the preliminary
statements of the Agreement.

     “Originator” and “Originators” have the meaning set forth in the Sale
Agreement, as the same may be modified from time to time by adding new Originators or removing
Originators, in each case with the prior written consent of the Administrator.

     “Originator Assignment Certificate” means the assignment by each Originator to the
Contributor, and subsequently to the Seller, in substantially the form of Exhibit C to the
Sale Agreement, evidencing Seller’s ownership of the Receivables generated by the Originators, as
the same may be amended, supplemented, amended and restated, or otherwise modified from time to
time in accordance with the Sale Agreement.

     “Other Material Financing Agreement” has the meaning set forth in paragraph
(j) of Exhibit V of the Agreement.

I-16

 

     “Outstanding Balance” of any Receivable at any time means the then outstanding
principal balance thereof.

     “Participant” has the meaning set forth in Section 5.3(b) of this Agreement.

     “Paydown Notice” has the meaning set forth in Section 1.6(f)(i) of the
Agreement.

     “Payment Date” has the meaning set forth in Section 2.1 of the Sale Agreement.

     “Peabody” has the meaning set forth in the preamble to the Agreement.

     “Percentage” means, for each Purchaser Group, a fraction (expressed as a percentage),
(a) the numerator of which is such Purchaser Group’s Group Commitment and (b) the denominator of
which is the aggregate Group Commitments of all Purchaser Groups.

     “Performance Reserve” means the sum of the Loss Reserve and the Dilution Reserve.

     “Permitted Lock-Box Bank” means a bank or other financial institution with minimum
capital of at least $250,000.

     “Person” means an individual, partnership, corporation (including a business trust),
joint stock company, trust, unincorporated association, joint venture, limited liability company or
other entity, or a government or any political subdivision or agency thereof.

     “PNC” has the meaning set forth in the preamble to the Agreement.

     “Pool Assets” has the meaning set forth in Section 1.4(e) of the Agreement.

     “Pool Receivable” means a Receivable in the Receivables Pool.

     “Portion of Capital” means, with respect to any Purchaser and its Capital, any
separate portion of such Capital being funded or maintained by such Purchaser (or its successors or
permitted assigns) by reference to a particular interest rate basis. In addition, at any time when
such Capital is not divided into two or more such portions, “Portion of Capital” means 100% of such
Capital.

     “Program Support Agreement” means and includes any Liquidity Agreement and any other
agreement entered into by any Program Support Provider providing for: (a) the issuance of one or
more letters of credit for the account of any Conduit Purchaser, (b) the issuance of one or more
surety bonds for which any Conduit Purchaser is obligated to reimburse the applicable Program
Support Provider for any drawings thereunder, (c) the sale by any Conduit Purchaser to any Program
Support Provider of the Purchased Assets (or portions thereof) and/or (d) the making of loans
and/or other extensions of credit to any Conduit Purchaser in connection with such Conduit
Purchaser’s securitization program contemplated in the Agreement, together with any letter of
credit, surety bond or other instrument issued thereunder.

     “Program Support Provider” means and includes, with respect to any Conduit Purchaser,
any Liquidity Bank and any other Person (other than any customer of such Conduit Purchaser)

I-17

 

now or hereafter extending credit or having a commitment to extend credit to or for the
account of, or to make purchases from, such Conduit Purchaser pursuant to any Program Support
Agreement.

     “Pro Rata Share” means, as to any LC Participant, a fraction, the numerator of which
equals the Commitment of such LC Participant at such time and the denominator of which equals the
aggregate of the Commitments of all LC Participants at such time.

     “Purchase and Sale Indemnified Amounts” has the meaning set forth in Section
9.1 of the Sale Agreement.

     “Purchase and Sale Indemnified Party” has the meaning set forth in Section 9.1
of the Sale Agreement.

     “Purchase and Sale Termination Date” has the meaning set forth in Section 1.4
of the Sale Agreement.

     “Purchase and Sale Termination Event” has the meaning set forth in Section 8.1
of the Sale Agreement.

     “Purchased Assets” has the meaning set forth in Section 1.3(b) of the
Agreement.

     “Purchased Assets Coverage Percentage” means, at any time and subject to Section
1.5 of the Agreement, the percentage computed as:

	 	 	 	 	 
	 

	 	Aggregate Capital + Adjusted LC Participation Amount + Total Reserves
 

Net Receivables Pool Balance
	 	 

The Purchased Assets Coverage Percentage shall be determined from time to time in accordance with
Section 1.5 of the Agreement.

     “Purchase Limit” means $275,000,000, as such amount may be reduced pursuant to
Sections 1.1(c) or 1.12 of the Agreement. References to the unused portion of the
Purchase Limit shall mean, at any time, the Purchase Limit minus the sum of the Aggregate Capital
plus the LC Participation Amount.

     “Purchase Price” has the meaning set forth in Section 2.1 of the Sale
Agreement.

     “Purchase Report” has the meaning set forth in Section 2.1 of the Sale
Agreement.

     “Purchasers” means each Conduit Purchaser, each Related Committed Purchaser, the LC
Bank and each LC Participant.

     “Purchaser Agent” means each Person acting as agent on behalf of a Purchaser Group and
designated as a Purchaser Agent for such Purchaser Group on the signature pages to this Agreement
or any other Person who becomes a party to this Agreement as a Purchaser Agent pursuant to an
Assumption Agreement or a Transfer Supplement.

I-18

 

     “Purchaser Group” means, for any Conduit Purchaser, such Conduit Purchaser, its
Related Committed Purchaser, related Purchaser Agent, related LC Participants and, in the case of
Market Street Funding LLC as a Conduit Purchaser, the LC Bank.

     “Purchasing Related Committed Purchaser” has the meaning set forth in Section
5.3(c) of the Agreement.

     “Receivable” means any indebtedness and other obligations owed to the Seller (as
assignee of the Contributor and each Originator), the Contributor or any Originator by, or any
right of the Seller, the Contributor or any Originator to payment from or on behalf of, an Obligor,
whether constituting an account, chattel paper, instrument or general intangible, arising in
connection with the sale of goods or the rendering of services by any Originator, and includes the
obligation to pay any finance charges, fees and other charges with respect thereto. Indebtedness
and other obligations arising from any one transaction, including indebtedness and other
obligations represented by an individual invoice or agreement, shall constitute a Receivable
separate from a Receivable consisting of the indebtedness and other obligations arising from any
other transaction.

     “Receivables Pool” means, at any time, all of the then outstanding Receivables
purchased by the Contributor pursuant to the Sale Agreement prior to the Facility Termination Date.

     “Reimbursement Obligation” has the meaning set forth in Section 1.16 of the
Agreement.

     “Reinvestment” has the meaning set forth in Section 1.4(b) of the Agreement.

     “Related Committed Purchaser” means each Person listed as such (and its respective
Commitment) for each Conduit Purchaser as set forth on the signature pages of the Agreement or in
any Assumption Agreement or Transfer Supplement.

     “Related Rights” has the meaning set forth in Section 1.1 of the Sale
Agreement.

     “Related Security” means, with respect to any Receivable:

     (a) all of the Seller’s, the Contributor’s and each Originator’s interest in any goods
(including returned goods), and documentation of title evidencing the shipment or storage of
any goods (including returned goods), relating to any sale giving rise to such Receivable,

     (b) all instruments and chattel paper that may evidence such Receivable,

     (c) all other security interests or liens and property subject thereto from time to
time purporting to secure payment of such Receivable, whether pursuant to the Contract
related to such Receivable or otherwise, together with all UCC financing statements or
similar filings relating thereto, and

     (d) all of the Seller’s, the Contributor’s and each Originator’s rights, interests and
claims under the Contracts and all guaranties, indemnities, insurance and other agreements
(including the related Contract) or arrangements of whatever character from

I-19

 

time to time supporting or securing payment of such Receivable or otherwise relating to
such Receivable, whether pursuant to the Contract related to such Receivable or otherwise.

     “Required LC Participants” means, at any time, the LC Participants whose Pro Rata
Shares aggregate 662⁄3% or more.

     “Responsible Officer” means, with respect to each Originator, the Contributor, the
Servicer, the Transferee and the Seller, any president, vice president, treasurer, assistant
treasurer, secretary, assistant secretary, chief financial officer, controller or any other officer
of any such Person charged with the responsibility for administration of any Transaction Document.

     “Restricted Payments” has the meaning set forth in Section 1(n) of Exhibit
IV of the Agreement.

     “Sale Agreement” means the Purchase and Sale Agreement, dated as of February 20, 2002,
between the Contributor and the Originators as such agreement may be amended, amended and restated,
supplemented or otherwise modified from time to time.

     “Seller” has the meaning set forth in the preamble to the Agreement.

     “Senior Notes Indenture” means that certain Indenture, dated as of March 21, 2003,
among Peabody, the guarantors named therein, and U.S. Bank National Association, as trustee.

     “Servicer” has the meaning set forth in the preamble to the Agreement.

     “Servicer Note” means that certain Amended and Restated Promissory Note, dated as of
the Closing Date, made by Peabody in favor of the Seller, as the same may be amended from time to
time.

     “Servicing Fee” means the fee referred to in Section 4.6 of the Agreement.

     “Servicing Fee Rate” means the rate referred to in Section 4.6 of the
Agreement.

     “Settlement Date” means with respect to any Portion of Capital for any Settlement
Period, (i) prior to the Facility Termination Date, the Monthly Settlement Date and (ii) on and
after the Facility Termination Date, each day selected from time to time by the Administrator (with
the consent or at the direction of the Majority Purchaser Agents); it being understood that the
Administrator may select such Settlement Date to occur as frequently as daily, or, in the absence
of such selection, the Monthly Settlement Date.

     “Settlement Period” means: (a) before the Facility Termination Date, each period
commencing on the second Business Day prior to each Monthly Settlement Date and ending on (but not
including) the second Business Day prior to the next Monthly Settlement Date, and (b) on and after
the Facility Termination Date, such period (including a period of one day) as shall be selected
from time to time by the Administrator or, in the absence of any such selection, each period of 30
days from the last day of the preceding Settlement Period.

I-20

 

     “Similar Businesses” means coal production, coal mining, coal brokering, coal
transportation, mine development, power marketing, electricity generation, power/ energy sales and
trading, energy transactions/ asset restructurings, risk management products associated with
energy, fuel/ power integration and other energy related businesses, ash disposal, environmental
remediation, coal, natural gas, petroleum or other fossil fuel exploration, production, marketing,
transportation and distribution and other related businesses, and activities of Peabody and its
Subsidiaries as of the Closing Date and any business or activity that is reasonably similar thereto
or a reasonable extension, development or expansion thereof or ancillary thereto.

     “Solvent” means, with respect to any Person at any time, a condition under which:

     (i) the fair value and present fair saleable value of such Person’s total assets is, on
the date of determination, greater than such Person’s total liabilities (including
contingent and unliquidated liabilities) at such time;

     (ii) the fair value and present fair saleable value of such Person’s assets is greater
than the amount that will be required to pay such Person’s probable liability on its
existing debts as they become absolute and matured (“debts,” for this purpose, includes all
legal liabilities, whether matured or unmatured, liquidated or unliquidated, absolute,
fixed, or contingent);

     (iii) such Person is and shall continue to be able to pay all of its liabilities as
such liabilities mature; and

     (iv) such Person does not have unreasonably small capital with which to engage in its
current and in its anticipated business.

For
purposes of this definition:

     (A) the amount of a Person’s contingent or unliquidated liabilities at any time shall
be that amount which, in light of all the facts and circumstances then existing, represents
the amount which can reasonably be expected to become an actual or
matured liability;

     (B) the “fair value” of an asset shall be the amount which may be realized within a
reasonable time either through collection or sale of such asset at its regular market value;

     (C) the “regular market value” of an asset shall be the amount which a capable and
diligent business person could obtain for such asset from an interested buyer who is willing
to Purchase such asset under ordinary selling conditions; and

     (D) the “present fair saleable value” of an asset means the amount which can be
obtained if such asset is sold with reasonable promptness in an arm’s-length transaction in
an existing and not theoretical market.

     “Special Member” has the meaning set forth in Schedule A to the LLC Agreement.

I-21

 

     “Special Obligor” means the Navajo Project, for so long as, with respect to such
Navajo Project, (a) the agreement among the project participants requires that upon the default of
any participant, the non-defaulting participants are required to cure any such default, and (b)
Peabody represents and warrants that, to its knowledge, the statement set forth in subsection (a)
above is true, complete and correct. The Navajo Project shall be deemed to be a “Special
Group A Obligor” hereunder for so long as such Navajo Project has at least one project
participant with the rating of a Group A Obligor; the Navajo Project shall be deemed to be a
“Special Group B Obligor” hereunder for so long as such Navajo Project has at least one
project participant with the rating of a Group B Obligor (but no project participants with the
rating of a Group A Obligor); the Navajo Project shall be deemed to be a “Special Group C
Obligor” hereunder for so long as such Navajo Project has at least one project participant with
the rating of a Group C Obligor (but no project participants with the rating of a Group A Obligor
or a Group B Obligor); and the Navajo Project shall be deemed to be a “Special Group D
Obligor” hereunder for so long as such Navajo Project has no project participants with the
rating of a Group A Obligor, a Group B Obligor or a Group C Obligor.

     “Special Obligor Group” means any one of the following: Special Group A Obligor,
Special Group B Obligor, Special Group C Obligor, or Special Group D Obligor.

     “Spike Factor” means, for any calendar month, (a) the positive difference, if any,
between: (i) the highest Dilution Ratio for any one calendar month during the twelve most recent
calendar months and (ii) the arithmetic average of the Dilution Ratios for such twelve months
times (b) (i) the highest Dilution Ratio for any one calendar month during the twelve most
recent calendar months divided by (ii) the arithmetic average of the Dilution Ratios for
such twelve months.

     “Standard & Poor’s” means Standard & Poor’s Ratings Services, a Standard and Poor’s
Financial Services LLC business.

     “Sub-Servicer” has the meaning set forth in Section 4.1 of the Agreement.

     “Subsidiary” means, as to any Person, a corporation, partnership, limited liability
company or other entity of which shares of stock of each class or other interests having ordinary
voting power (other than stock or other interests having such power only by reason of the happening
of a contingency) to elect a majority of the Board of Directors or other managers of such entity
are at the time owned, or management of which is otherwise controlled: (a) by such Person, (b) by
one or more Subsidiaries of such Person or (c) by such Person and one or more Subsidiaries of such
Person.

     “Termination Day” means: (a) each day on which the conditions set forth in
Section 2 of Exhibit II to the Agreement are not satisfied or (b) each day that
occurs on or after the Facility Termination Date.

     “Termination Event” has the meaning specified in Exhibit V to the Agreement.

     “Termination Fee” means, for any Settlement Period during which a Termination Day
occurs, the amount, if any, by which: (a) the additional Discount (calculated without taking into
account any Termination Fee or any shortened duration of such Settlement Period pursuant to the

I-22

 

definition thereof) that would have accrued during such Settlement Period on the reductions of
Capital relating to such Settlement Period had such reductions not been made, exceeds (b) the
income, if any, received by the applicable Purchaser from investing the proceeds of such reductions
of Capital, as determined by the applicable Purchaser Agent, which determination shall be binding
and conclusive for all purposes, absent manifest error.

     “Total Reserves” means, at any time the sum of: (a) the Yield Reserve, plus the
greater of (b) (i) the Performance Reserve, or (ii) the Concentration Reserve.

     “Transaction Documents” means the Agreement, the Lock-Box Agreements, the Fee Letters,
the Sale Agreement, the Contribution Agreement, the Intercreditor Agreement, the Servicer Note, and
all other certificates, instruments, UCC financing statements, reports, notices, agreements and
documents executed or delivered under or in connection with the Agreement, in each case as the same
may be amended, supplemented or otherwise modified from time to time in accordance with the
Agreement.

     “Transfer Supplement” has the meaning set forth in Section 5.3(c) of the
Agreement.

     “TVA” means Tennessee Valley Authority, an Obligor of the Originators.

     “UCC” means the Uniform Commercial Code as from time to time in effect in the
applicable jurisdiction.

     “UCP 600” has the meaning set forth in Section 1.14 of the Agreement.

     “Unmatured Contribution Termination Event” means any event which, with the giving of
notice or lapse of time, or both, would become a Contribution Termination Event.

     “Unmatured Purchase and Sale Termination Event” means any event which, with the giving
of notice or lapse of time, or both, would become a Purchase and Sale Termination Event.

     “Unmatured Termination Event” means an event that, with the giving of notice or lapse
of time, or both, would constitute a Termination Event.

     “Yield Reserve” means, on any date, an amount equal to: (a) the sum of the Aggregate
Capital plus the LC Participation Amount at the close of business of the Seller on such date
multiplied by (b) (i) the Yield Reserve Percentage on such date divided by (ii) 100% minus the
Yield Reserve Percentage on such date.

     “Yield Reserve Percentage” means at any time:

(BR+SFR) x l.5 x DSO

     360

     where:

	 	 	 	 	 
	BR

	 	=
	 	the Base Rate computed for the most recent Settlement Period,

I-23

 

	 	 	 	 	 
	DSO 

SFR

	 	=

=
	 	Days’ Sales Outstanding, and 

the Servicing Fee Rate

     Other Terms. All accounting terms not specifically defined herein shall be construed
in accordance with generally accepted accounting principles. All terms used in Article 9 of the
UCC in the State of Illinois, and not specifically defined herein, are used herein as defined in
such Article 9. Unless the context otherwise requires, “or” means “and/or,” and “including” (and
with correlative meaning “include” and “includes”) means including without limiting the generality
of any description preceding such term.

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EXHIBIT II

CONDITIONS PRECEDENT

     1. Conditions Precedent to Effectiveness of this Agreement. The effectiveness of
this Agreement is subject to the following conditions precedent that the Administrator shall have
received on or before the Closing Date, each in form and substance (including the date thereof)
satisfactory to the Administrator:

     (a) Counterparts of this Agreement executed by each of the parties hereto.

     (b) Counterparts of the Fee Letters executed by the parties thereto and confirmation by the
applicable Purchaser Agent that any fees payable thereunder by the Seller on the Closing Date have
been paid in full.

     (c) Counterparts of that certain third amendment to the Lock-Box Agreement with PNC Bank,
National Association, dated as of the Closing Date, executed by the parties thereto as the
Administrator may reasonably request in order to give effect to the transactions contemplated by
this Agreement.

     (d) Counterparts of that certain Originator Release, dated as of the date hereof, regarding
the removal of Peabody Coaltrade International (CTI), LLC as an Originator and a Sub-Servicer
executed by each of the parties thereto.

     (e) Counterparts of that certain eighth amendment to the Sale Agreement, dated as of the
Closing Date, executed by the Contributor and the Originators (for the avoidance of doubt, other
than Peabody Coaltrade International (CTI), LLC).

     (f) Counterparts of that certain first amendment to the Contribution Agreement, dated as of
the Closing Date, executed by the Seller and the Contributor.

     (g) The executed Servicer Note (as defined in the Agreement) and an allonge thereto executed
by the Seller endorsing the Servicer Note in blank.

     (h) Copies of the resolutions of the Board of Directors of each of the Seller, the
Sub-Servicers and Peabody authorizing the execution, delivery and performance by the Seller, the
Sub-Servicers and Peabody of the Agreement and the other Transaction Documents to which they are
parties.

     (i) A certificate of the Secretary or Assistant Secretary of each of the Seller, the
Sub-Servicers and Peabody certifying the names and true signatures of its officers who are
authorized to sign the Agreement and the other Transaction Documents to which they are parties.
Until the Administrator receives a subsequent incumbency certificate from the Seller, the
Sub-Servicers or Peabody, as the case may be, the Administrator shall be entitled to rely on the
last such certificate delivered to it by the Seller, the Sub-Servicers or Peabody, as the case may
be.

     (j) A copy of the Seller’s certificate of formation, certified as of a recent date by the
Delaware Secretary of State and the Seller’s LLC Agreement.

II-1

 

     (k) Good standing certificates with respect to each of the Seller, the Originators, and
Peabody issued by the Secretary of State (or similar official) of the state of each such Person’s
organization or formation and principal place of business.

     (l) Favorable opinions, in form and substance reasonably satisfactory to the Administrator and
each Purchaser Agent, of: (i) Thompson Coburn, counsel for the Seller, the Originators, and
Peabody, (ii) Ziemer, Stayman, Weitzel & Shoulders, LLP, counsel for Arclar Company, LLC and
Peabody Midwest Mining, LLC, and (iii) Alexander C. Schoch, Executive Vice President Law and Chief
Legal Officer to the Seller, the Originators and Peabody, regarding such corporate, enforceability,
no-conflicts, Investment Company Act, security interest, true sale and non-consolidation matters as
the Administrator and the Purchaser Agents may reasonably request.

     (m) All information with respect to the Receivables as the Administrator or the Purchaser
Agents may reasonably request.

     (n) Such other approvals, opinions or documents as the Administrator or the Purchaser Agents
may reasonably request.

     2. Conditions Precedent to All Investments, Issuances of Letters of Credit and
Reinvestments. Each Investment (including the initial Investment, but excluding the deemed
Investment made pursuant to the first sentence of Section 1.2(c), the assignments and
assumptions made pursuant to Section 1.2(d) and any deemed Investment pursuant to
Section 1.4(f) of the Agreement) and the issuance of any Letters of Credit and each
Reinvestment shall be subject to the further conditions precedent that:

     (a) in the case of each Investment and the issuance of any Letters of Credit, the Servicer
shall have delivered to the Administrator and each Purchaser Agent on or before such Investment or
issuance, as the case may be, in form and substance satisfactory to the Administrator and each
Purchaser Agent, a completed pro forma Information Package to reflect the level of Aggregate
Capital, the LC Participation Amount and related reserves and the calculation of the Purchased
Asset Coverage Percentage after such subsequent Investment or issuance, as the case may be, and a
completed Investment Notice in the form of Annex B; and

     (b) on the date of such Investment, issuance or Reinvestment, as the case may be, the
following statements shall be true (and acceptance of the proceeds of such Investment, issuance or
Reinvestment shall be deemed a representation and warranty by the Seller that such statements are
then true):

     (i) the representations and warranties contained in Exhibit III to the
Agreement are true and correct in all material respects on and as of the date of such
Investment, issuance or Reinvestment as though made on and as of such date (except to the
extent that such representations and warranties expressly relate to an earlier date, and in
which case such representations and warranties shall be true and correct in all material
respects as of such earlier date);

     (ii) no event has occurred and is continuing, or would result from such Investment,
issuance or Reinvestment, that constitutes a Termination Event;

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     (iii) solely in the case of any Investment (but not Reinvestment) or any such issuance,
no Unmatured Termination Event shall exist and be continuing;

     (iv) the sum of the Aggregate Capital plus the LC Participation Amount, after giving
effect to any such Investment, issuance or Reinvestment, as the case may be, shall not
exceed the Purchase Limit;

     (v) after giving effect to any such Investment, issuance or Reinvestment, as the case
may be, the Purchased Assets Coverage Percentage shall not exceed 100%; and

     (vi) the Facility Termination Date shall not have occurred.

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EXHIBIT III

REPRESENTATIONS AND WARRANTIES

     1. Representations and Warranties of the Seller. The Seller represents and warrants
as follows:

     (a) The Seller is a limited liability company duly organized, validly existing and in good
standing under the laws of the State of Delaware, and is duly qualified to do business and is in
good standing as a foreign limited liability company in every jurisdiction where the nature of its
business requires it to be so qualified, except where the failure to be so qualified would not have
a Material Adverse Effect.

     (b) The execution, delivery and performance by the Seller of the Agreement and the other
Transaction Documents to which it is a party, including its use of the proceeds of Investments and
Reinvestments: (i) are within its organizational powers; (ii) have been duly authorized by all
necessary organizational action; (iii) do not contravene or result in a default under or conflict
with: (A) its certificate of formation or any other organizational document of the Seller, (B) any
law, rule or regulation applicable to it, (C) any indenture, loan agreement, mortgage, deed of
trust or other material agreement or instrument to which it is a party or by which it is bound, or
(D) any order, writ, judgment, award, injunction or decree binding on or affecting it or any of its
property; and (iv) do not result in or require the creation of any Adverse Claim upon or with
respect to any of its properties. The Agreement and the other Transaction Documents to which it is
a party have been duly executed and delivered by the Seller.

     (c) No authorization, approval or other action by, and no notice to or filing with, any
Governmental Authority or other Person is required for its due execution, delivery and performance
by the Seller of the Agreement or any other Transaction Document to which it is a party, other than
the Uniform Commercial Code filings referred to in Exhibit II to the Agreement, all of
which shall have been filed on or before the Closing Date.

     (d) Each of the Agreement and the other Transaction Documents to which the Seller is a party
constitutes its legal, valid and binding obligation enforceable against the Seller in accordance
with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization
or other similar laws from time to time in effect affecting the enforcement of creditors’ rights
generally and by general principles of equity, regardless of whether such enforceability is
considered in a proceeding in equity or at law.

     (e) There is no pending or, to Seller’s best knowledge, threatened action or proceeding
affecting Seller or any of its properties before any Governmental Authority or arbitrator.

     (f) No proceeds of any Investment or Reinvestment will be used to acquire any equity security
of a class that is registered pursuant to Section 12 of the Securities Exchange Act of 1934.

     (g) The Seller is the legal and beneficial owner of, and has good and marketable title to, the
Pool Receivables, the Lock-Box Accounts (and related lock-boxes) and Related Security,

III-1

 

free and clear of any Adverse Claim. Upon each Investment or Reinvestment, the Administrator
(on behalf of the Purchasers) shall acquire a valid and enforceable perfected ownership or security
interest in each Pool Receivable then existing or thereafter arising and in the Related Security,
Collections and other proceeds with respect thereto, free and clear of any Adverse Claim. The
Agreement creates a valid and continuing ownership or security interest (as defined in the
applicable UCC) in favor of the Administrator in the Pool Assets and the Lock-Box Accounts (and
related lock-boxes), which ownership or security interest is prior to all other Adverse Claims, and
is enforceable as such against creditors of and purchasers from the Seller. The Pool Assets
constitute “accounts”, “general intangibles” or “tangible chattel paper” within the meaning of the
applicable UCC. Each Lock-Box Account constitutes a “deposit account” within the meaning of the
applicable UCC. The Seller has caused or will have caused, within ten (10) days, the filing of all
appropriate UCC financing statements in the proper filing offices in the appropriate jurisdictions
under applicable laws in order to perfect the ownership or security interest in the Pool Assets and
the Lock-Box Accounts (and related lock-boxes) granted to the Administrator (on behalf of the
Purchasers) hereunder. Other than the ownership or security interest granted to the Administrator
(on behalf of the Purchasers) pursuant to this Agreement, Seller has not pledged, assigned, sold,
granted a security interest in, or otherwise conveyed any of the Pool Assets or the Lock-Box
Accounts (and related lock-boxes). Seller has not authorized the filing of and is not aware of any
UCC financing statements against Seller that include a description of collateral covering the Pool
Assets, other than any UCC financing statement relating to the security interest granted to the
Administrator (on behalf of the Purchasers) hereunder or that has been terminated. Seller is not
aware of any judgment, ERISA or tax lien filings against the Seller. With respect to any Pool
Receivable that constitutes “tangible chattel paper”, the Servicer is in possession of the original
copies of the tangible chattel paper that constitutes or evidences such Pool Receivables, and the
Seller has filed or has caused to be filed within ten (10) days after the date hereof the financing
statements described in this section above, each of which will contain a statement that “A purchase
of or a grant of a security interest in any property described in this financing statement will
violate the rights of the Administrator.” The Pool Receivables to the extent they are evidenced by
“tangible chattel paper” do not have any marks or notations indicating that they have been pledged,
assigned or otherwise conveyed to any Person other than the Seller or the Administrator (on behalf
of the Purchasers).

     (h) Each Information Package (if prepared by the Seller or one of its Affiliates, or to the
extent that information contained therein is supplied by the Seller or one of its Affiliates),
information, exhibit, financial statement, document, book, record or report furnished or to be
furnished at any time by or on behalf of the Seller to the Administrator or any Purchaser Agent in
connection with the Agreement or any other Transaction Document to which it is a party is or will
be complete and accurate in all material respects as of its date or (except as otherwise disclosed
to the Administrator or such Purchaser Agent, as applicable, at such time) as of the date so
furnished.

     (i) The Seller’s principal place of business, chief executive office and state of formation
(as such terms are used in the UCC) and the office where it keeps its records concerning the
Receivables are located at the address referred to in Sections l(b) and 2(b) of
Exhibit IV to the Agreement.

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     (j) The names and addresses of all the Lock-Box Banks, together with the account numbers of
the Lock-Box Accounts at such Lock-Box Banks, are specified in Schedule II to the Agreement
(or at such other Lock-Box Banks and/or with such other Lock-Box Accounts as have been notified to
the Administrator in accordance with the Agreement) and all Lock-Box Accounts are subject to
Lock-Box Agreements. With respect to all Lock-Box Accounts (and related lock-boxes), the Seller
has delivered to the Administrator, on behalf of the Purchasers, a fully executed Lock-Box
Agreement pursuant to which the applicable Lock-Box Bank has agreed, following the occurrence and
continuation of a Termination Event, to comply with all instructions given by the Administrator
with respect to all funds on deposit in such Lock-Box Account (and all funds sent to the respective
lock-box), without further consent by the Seller or the Servicer. None of the Lock-Box Accounts
(and the related lock-boxes) are in the name of any Person other than the Seller or the
Administrator (on behalf of the Purchasers). The Seller has not consented to any Lock-Box Bank’s
complying with instructions of any person other than the Administrator.

     (k) The Seller is not in violation of any order of any court, arbitrator or Governmental
Authority.

     (l) Neither the Seller nor any of its Affiliates has any direct or indirect ownership or other
financial interest in any Conduit Purchaser.

     (m) No proceeds of any Investment or Reinvestment will be used for any purpose that violates
any applicable law, rule or regulation, including Regulations T, U or X of the Federal Reserve
Board.

     (n) Each Pool Receivable included as an Eligible Receivable in the calculation of the Net
Receivables Pool Balance is an Eligible Receivable.

     (o) No event has occurred and is continuing, or would result from an Investment or
Reinvestment or from the application of the proceeds therefrom, that constitutes a Termination
Event or an Unmatured Termination Event.

     (p) The Seller has accounted for each sale of the Receivables and the other Purchased Assets
in its books and financial statements as sales, consistent with generally accepted accounting
principles.

     (q) The Seller has complied in all material respects with the Credit and Collection Policy of
the Originators with regard to each Receivable originated by the Originators.

     (r) The Seller has complied in all material respects with all of the terms, covenants and
agreements contained in the Agreement and the other Transaction Documents that are applicable to
it.

     (s) The Seller’s complete organizational name is set forth in the preamble to the Agreement,
and it does not use and has not during the last six years used any other organizational name, trade
name, doing-business name or fictitious name, except as set forth on Schedule III to the
Agreement and except for names first used after the date of the Agreement and set forth in a

III-3

 

notice delivered to the Administrator pursuant to Section 1(1)(iv) of Exhibit
IV to the Agreement.

     (t) The Seller is not an “investment company,” or a company “controlled” by an “investment
company” within the meaning of the Investment Company Act of 1940, as amended.

     2. Representations and Warranties of Peabody (including in its capacity as the
Servicer). Peabody, individually and in its capacity as the Servicer, represents and warrants
jointly and severally as follows:

     (a) Peabody is a corporation duly formed, validly existing and in good standing under the laws
of the State of Delaware, and is duly qualified to do business and is in good standing as a foreign
corporation in every jurisdiction where the nature of its business requires it to be so qualified,
except where the failure to be so qualified would not have a Material Adverse Effect.

     (b) The execution, delivery and performance by Peabody of the Agreement and the other
Transaction Documents to which it is a party, including the Servicer’s use of the proceeds of
Investments and Reinvestments: (i) are within its organizational powers; (ii) have been duly
authorized by all necessary organizational action; (iii) do not contravene or result in a default
under or conflict with: (A) its certificate of incorporation or any other organizational document
of Peabody, (B) any law, rule or regulation applicable to it, (C) any indenture, loan agreement,
mortgage, deed of trust or other material agreement or instrument to which it is a party or by
which it is bound, or (D) any order, writ, judgment, award, injunction or decree binding on or
affecting it or any of its property; and (iv) do not result in or require the creation of any
Adverse Claim upon or with respect to any of its properties. The Agreement and the other
Transaction Documents to which Peabody is a party have been duly executed and delivered by Peabody.

     (c) No authorization, approval or other action by, and no notice to or filing with any
Governmental Authority or other Person, is required for the due execution, delivery and performance
by Peabody of the Agreement or any other Transaction Document to which it is a party.

     (d) Each of the Agreement and the other Transaction Documents to which Peabody is a party
constitutes the legal, valid and binding obligation of Peabody enforceable against Peabody in
accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency,
reorganization or other similar laws from time to time in effect affecting the enforcement of
creditors’ rights generally and by general principles of equity, regardless of whether such
enforceability is considered in a proceeding in equity or at law.

     (e) The balance sheets of Peabody and its consolidated Subsidiaries as at December 31, 2008,
and the related statements of income and retained earnings for the fiscal year then ended, copies
of which have been furnished to the Administrator, fairly present in all material respects the
financial condition of Peabody and its consolidated Subsidiaries as at such date and the results of
the operations of Peabody and its consolidated Subsidiaries for the period ended on such date, all
in accordance with generally accepted accounting principles consistently applied,

III-4

 

and since December 31, 2008 there has been no event or circumstances which have had a Material
Adverse Effect.

     (f) Except as disclosed in the most recent audited financial statements of Peabody furnished
to the Administrator, there is no pending or, to its best knowledge, threatened action or
proceeding affecting it or any of its Subsidiaries before any Governmental Authority or arbitrator
that is reasonably likely to have a Material Adverse Effect.

     (g) No proceeds of any Investment or Reinvestment will be used to acquire any equity security
of a class that is registered pursuant to Section 12 of the Securities Exchange Act of 1934. No
proceeds of any Investment or Reinvestment will be used for any purpose that violates any
applicable law, rule or regulation, including Regulations T, U or X of the Federal Reserve Board.

     (h) Each Information Package (if prepared by Peabody or one of its Affiliates, or to the
extent that information contained therein is supplied by Peabody or an Affiliate), information,
exhibit, financial statement, document, book, record or report furnished or to be furnished at any
time by or on behalf of the Servicer to the Administrator or any Purchaser Agent in connection with
the Agreement is or will be complete and accurate in all material respects as of its date or
(except as otherwise disclosed to the Administrator or such Purchaser Agent, as applicable, at such
time) as of the date so furnished.

     (i) The principal place of business, chief executive office and state of formation (as such
terms are used in the UCC) of Peabody and the office where it keeps its records concerning the
Receivables are located at the address referred to in Section 2(b) of Exhibit IV to
the Agreement.

     (j) Peabody is not in violation of any order of any court, arbitrator or Governmental
Authority, which is reasonably likely to have a Material Adverse Effect.

     (k) Neither Peabody nor any of its Affiliates has any direct or indirect ownership or other
financial interest in any Conduit Purchaser.

     (l) The Servicer has complied in all material respects with the Credit and Collection Policy
of the Originators with regard to each Receivable originated by the Originators.

     (m) Peabody has complied in all material respects with all of the terms, covenants and
agreements contained in the Agreement and the other Transaction Documents that are applicable to
it.

     (n) Peabody is not an “investment company” or a company “controlled” by an “investment
company” within the meaning of the Investment Company Act of 1940, as amended.

     (o) [Reserved].

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     (p) The agreement among the project participants of the Navajo Project requires that upon the
default of any participant, the non-defaulting participants are required to cure any such default.

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EXHIBIT IV

COVENANTS

     1. Covenants of the Seller. Until the Final Payout Date:

     (a) Compliance with Laws, Etc. The Seller shall comply in all material respects with
all applicable laws, rules, regulations and orders, and preserve and maintain its organizational
existence, rights, franchises, qualifications and privileges, except to the extent that the failure
so to comply with such laws, rules, regulations and orders or the failure so to preserve and
maintain such rights, franchises, qualifications and privileges would not have a Material Adverse
Effect.

     (b) Offices, Records and Books of Account, Etc. The Seller: (i) shall keep its
principal place of business, chief executive office and state of formation (as such terms or
similar terms are used in the UCC) and the office where it keeps its records concerning the
Receivables at the address of the Seller set forth on Schedule IV or, pursuant to
clause (1)(iv) below, at any other locations in jurisdictions where all actions reasonably
requested by the Administrator to protect and perfect the interest of the Administrator in the
Receivables and related items (including the Pool Assets) have been taken and completed and (ii)
shall provide the Administrator with at least 30 days’ written notice before making any change in
the Seller’s name or making any other change in the Seller’s identity or organizational structure
(including a Change in Control) that could render any UCC financing statement filed in connection
with this Agreement “seriously misleading” as such term (or similar term) is used in the UCC; each
notice to the Administrator pursuant to this sentence shall set forth the applicable change and the
effective date thereof. The Seller also will maintain and implement (or cause the Servicer to
maintain and implement) administrative and operating procedures (including an ability to recreate
records evidencing Receivables and related Contracts in the event of the destruction of the
originals thereof), and keep and maintain (or cause the Servicer to keep and maintain) all
documents, books, records, computer tapes and disks and other information reasonably necessary or
advisable for the collection of all Receivables (including records adequate to permit the daily
identification of each Receivable and all Collections of and adjustments to each existing
Receivable). Notwithstanding the above, in no event shall the Seller have or maintain, or be a
partner in any partnership that has or maintains, its jurisdiction of organization, principal place
of business or principal assets in any of the states of Colorado, Kansas, New Mexico, Oklahoma,
Utah or Wyoming.

     (c) Performance and Compliance with Contracts and Credit and Collection Policy. The
Seller shall (and shall cause the Servicer to), at its expense, timely and fully perform and comply
with all material provisions, covenants and other promises required to be observed by it under the
Contracts related to the Receivables, and timely and fully comply in all material respects with the
applicable Credit and Collection Policy with regard to each Receivable and the related Contract.

     (d) Ownership Interest, Etc. The Seller shall (and shall cause the Servicer to), at
its expense, take all action necessary or desirable to establish and maintain a valid and
enforceable ownership or security interest in the Pool Receivables, the Related Security and
Collections with respect thereto, and a first priority perfected ownership or security interest in
the Pool Assets, in

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each case free and clear of any Adverse Claim, in favor of the Administrator (on behalf of the
Purchasers), including taking such action to perfect, protect or more fully evidence the interest
of the Administrator (on behalf of the Purchasers), as the Administrator, may reasonably request.
The Seller shall from time to time and within the time limits established by law prepare and
present to the Administrator for the Administrator’s authorization and approval all financing
statements, amendments, continuations or initial financing statements in lieu of a continuation
statement, or other filings necessary to continue, maintain and perfect the Administrator’s (on
behalf of the Purchasers) ownership or security interest in the Pool Assets as a first-priority
interest. The Administrator’s approval of such filings shall authorize the Seller to file such
financing statements under the UCC without the signature of the Seller, or the Administrator, any
Purchaser Agent or any Purchaser where allowed by applicable law. Notwithstanding anything else in
the Transaction Documents to the contrary, neither the Seller, the Servicer nor any other Person
shall have any authority to file a termination, partial termination, release or partial release or
any amendment that deletes the name of a debtor or excludes collateral of any such financing
statements without the prior written consent of the Administrator.

     (e) Sales, Liens, Etc. The Seller shall not sell, assign (by operation of law or
otherwise) or otherwise dispose of, or create or suffer to exist any Adverse Claim upon or with
respect to, any or all of its right, title or interest in, to or under any Pool Assets (including
the Seller’s interest in any Receivable, Related Security or Collections, or upon or with respect
to any account to which any Collections of any Receivables are sent), or assign any right to
receive income in respect of any items contemplated by this paragraph.

     (f) Extension or Amendment of Receivables. Except as provided in the Agreement, the
Seller shall not, and shall not permit the Servicer to, alter the delinquency status or adjust the
Outstanding Balance or otherwise modify the terms of any Pool Receivable in any material respect,
or amend, modify or waive, in any material respect, any term or condition of any related Contract
(which term or condition relates to payments under, or the enforcement of, such Contract).

     (g) Change in Business or Credit and Collection Policy. Without the prior written
consent of the Administrator and each Purchaser Agent, the Seller shall not make (or permit the
Originators to make) any material change in the character of its business or in any Credit and
Collection Policy, or any change in any Credit and Collection Policy that would have a Material
Adverse Effect with respect to the Receivables. The Seller shall not make (or permit the
Originators to make) any other change in any Credit and Collection Policy without giving 30 days’
prior written notice thereof to the Administrator and each Purchaser Agent.

     (h) Audits. The Seller shall (and shall cause the Originators to), from time to time
during regular business hours as reasonably requested in advance (unless a Termination Event or
Unmatured Termination Event exists) by the Administrator, permit the Administrator or its agents or
representatives: (i) to examine and make copies of and abstracts from all books, records and
documents (including computer tapes and disks) in the possession or under the control of the Seller
(or the Originators) relating to Receivables and the Related Security, including the related
Contracts, (ii) to visit the offices and properties of the Seller and the Originators for the
purpose of examining such materials described in clause (i) above, and to

IV-2

 

discuss matters relating to Receivables and the Related Security or the Seller’s, Peabody’s or
any Originator’s performance under the Transaction Documents or under the Contracts with any of the
officers, employees, agents or contractors of the Seller, Peabody or any Originator having
knowledge of such matters and (iii) without limiting the clauses (i) and (ii)
above, to engage certified public accountants or other auditors acceptable to the Seller and the
Administrator to conduct, at the Seller’s expense, a review of the Seller’s books and records with
respect to such Receivables, provided, that at any time when no Termination Event exists and is
continuing, the Seller shall be required to reimburse the Administrator for only one (1) such audit
per year.

     (i) Change in Lock-Box Banks, Lock-Box Accounts and Payment Instructions to Obligors.
The Seller shall not, and shall not permit the Servicer or any Originator to, add or terminate any
bank as a Lock-Box Bank or any account as a Lock-Box Account from those listed in Schedule
II to the Agreement, or make any change in its instructions to Obligors regarding payments to
be made to the Seller, any Originator, the Servicer or any Lock-Box Account (or related post office
box), unless the Administrator shall have received ten (10) days prior written notice of assignment
to a Permitted Lock-Box Bank and the Administrator shall have received copies of all agreements
and documents (including Lock-Box Agreements) that it may request in connection therewith.

     (j) Deposits to Lock-Box Accounts. The Seller shall (or shall cause the Servicer to):
(i) instruct all Obligors to make payments of all Receivables to one or more Lock-Box Accounts or
to post office boxes to which only Lock-Box Banks have access (and shall instruct the Lock-Box
Banks to cause all items and amounts relating to such Receivables received in such post office
boxes to be removed and deposited into a Lock-Box Account on a daily basis), and (ii) deposit, or
cause to be deposited, any Collections received by it, the Servicer or any Originator into Lock-Box
Accounts not later than two (2) Business Days after receipt thereof. Each Lock-Box Account shall
at all times be subject to a Lock-Box Agreement. The Seller will not (and will not permit the
Servicer to) deposit or otherwise credit, or cause or permit to be so deposited or credited, to any
Lock-Box Account cash or cash proceeds other than Collections.

     (k) Marking of Records. At its expense, the Seller shall: (i) mark (or cause the
Servicer to mark) its master data processing records relating to Pool Receivables and related
Contracts, including with a legend evidencing that the Receivables and related Contracts included
in the Purchased Assets have been sold in accordance with the Agreement, and (ii) cause each
Originator so to mark its master data processing records pursuant to the Sale Agreement.

IV-3

 

     (l) Reporting Requirements. The Seller will provide to the Administrator and each
Purchaser Agent (in multiple copies, if requested by the Administrator or any Purchaser Agent) the
following:

     (i) as soon as available and in any event within 120 days after the end of each fiscal
year of the Seller, a copy of the financial statements for such year for the Seller,
certified as to accuracy by the chief financial officer or treasurer of the Seller;

     (ii) as soon as possible and in any event within five days after the occurrence of each
Termination Event or Unmatured Termination Event, a statement of the chief financial officer
of the Seller setting forth details of such Termination Event or Unmatured Termination Event
and the action that the Seller has taken and proposes to take with respect thereto;

     (iii) promptly after the filing or receiving thereof, copies of all reports and notices
that the Seller or any Affiliate files under ERISA with the Internal Revenue Service, the
Pension Benefit Guaranty Corporation or the U.S. Department of Labor or that the Seller or
any Affiliate receives from any of the foregoing or from any multiemployer plan (within the
meaning of Section 400l(a)(3) of ERISA) to which the Seller or any of its Affiliates is or
was, within the preceding five years, a contributing employer, in each case in respect of
the assessment of withdrawal liability or an event or condition that could, in the
aggregate, result in the imposition of liability on the Seller and/or any such Affiliate;

     (iv) at least thirty days before any change in the Seller’s name or any other change
requiring the amendment of UCC financing statements, a notice setting forth such changes and
the effective date thereof;

     (v) promptly after any Responsible Officer of the Seller obtains knowledge thereof,
notice of any: (A) material litigation, investigation or proceeding that may exist at any
time between the Seller and any Person or (B) material litigation or proceeding relating to
any Transaction Document;

     (vi) promptly after the occurrence thereof, notice of a material adverse change in the
business, operations, property or financial or other condition of the Seller, the Servicer
or the Originator; and

     (vii) such other information respecting the Receivables or the condition or operations,
financial or otherwise, of the Seller or any of its Affiliates as the Administrator or any
Purchaser Agent may from time to time reasonably request.

     (m) Certain Agreements. Without the prior written consent of the Administrator and
the Majority Purchaser Agents, the Seller will not (and will not permit the Originators to) amend,
modify, waive, revoke or terminate any Transaction Document to which it is a party or any provision
of Seller’s certificate of formation or other organizational document of the Seller.

IV-4

 

     (n) Restricted Payments. (i) Except pursuant to clause (ii) below,
the Seller will not: (A) purchase or redeem any shares of its capital stock, (B) declare or pay
any dividend or set aside any funds for any such purpose, (C) prepay, purchase or redeem any Debt,
(D) lend or advance any funds or (E) repay any loans or advances to, for or from any of its
Affiliates (the amounts described in clauses (A) through (E) being referred to as
“Restricted Payments”).

     (ii) Subject to the limitations set forth in clause (iii) below, the Seller may
make Restricted Payments so long as such Restricted Payments are made only in the following
way: the Seller may declare and pay distributions and make loans and advances to Peabody (provided that any such
loans and advances shall be treated as a dividend within no less than 30 days following the
making thereof).

     (iii) The Seller may make Restricted Payments only out of the funds it receives
pursuant to Sections 1.6(b)(ii) and (iv) and 1.6(d) of the
Agreement. Furthermore, the Seller shall not pay, make or declare: (A) any distributions,
loans or advances if, after giving effect thereto, the Seller’s tangible net worth would be
less than $10,000,000, or (B) any Restricted Payment (including any dividend) if, after
giving effect thereto, any Termination Event or Unmatured Termination Event shall have
occurred and be continuing.

     (o) Other Business. The Seller will not: (i) engage in any business other
than the transactions contemplated by the Transaction Documents; (ii) create, incur or permit to
exist any Debt of any kind (or cause or permit to be issued for its account any letters of credit
or bankers’ acceptances) other than pursuant to this Agreement or any Company Note; or (iii) form
any Subsidiary or make any investments in any other Person; provided, however, that
the Seller shall be permitted to incur minimal obligations to the extent necessary for the
day-to-day operations of the Seller (such as expenses for stationery, audits, maintenance of legal
status, etc.).

     (p) Use of Collections. The Seller shall apply the Collections that are
available to the Seller in accordance with the Agreement to make payments in the following order of
priority: (i) the payment of its expenses (including all obligations payable to the Purchasers,
the Purchaser Agents and the Administrator under the Agreement and under the Fee Letters); (ii) the
payment of accrued and unpaid interest on any Company Note; and (iii) other legal and valid
organizational purposes.

     (q) Tangible Net Worth. The Seller will not permit its tangible net worth,
at any time, to be less than $10,000,000.

     2. Covenants of the Servicer and Peabody. Until the Final Payout Date:

     (a) Compliance with Laws, Etc. The Servicer and, to the extent that it
ceases to be the Servicer, Peabody shall comply (and shall cause the Originators to comply) in all
material respects with all applicable laws, rules, regulations and orders, and preserve and
maintain its organizational existence, rights, franchises, qualifications and privileges, except to
the extent that the failure so to comply with such laws, rules and regulations or the failure so to
preserve and

IV-5

 

maintain such existence, rights, franchises, qualifications and privileges would not
have a Material Adverse Effect.

     (b) Offices, Records and Books of Account, Etc. The Servicer and, to the
extent that it ceases to be the Servicer, Peabody, (i) shall keep its principal place of business,
chief executive office and state of formation (as such terms or similar terms are used in the
applicable UCC) and the office where it keeps its records concerning the Receivables at the address
of the Servicer set forth on Schedule IV and (ii) shall cause Peabody Holding Company, LLC
and each Originator to keep its state of formation (as such term is defined in the applicable UCC)
and the office where it keeps its records concerning the Receivables at the applicable address set
forth on Schedule IV, in the case of Peabody Holding Company, LLC, and Exhibit E to
the Sale Agreement, in the case of any Originator or, in the case of either sub-clause (i)
or (ii) of this clause (b), upon at least 30 days’ prior written notice of a
proposed change to the Administrator, at any other locations in jurisdictions where all actions
reasonably requested by the Administrator to protect and perfect the interest of the Administrator
in the Receivables and related items (including the Pool Assets) have been taken and completed.
The Servicer and, to the extent that it ceases to be the Servicer, Peabody, also will (and will
cause the Originators to) maintain and implement administrative and operating procedures (including
an ability to recreate records evidencing Receivables and related Contracts in the event of the
destruction of the originals thereof), and keep and maintain all documents, books, records,
computer tapes and disks and other information reasonably necessary or advisable for the collection
of all Receivables (including records adequate to permit the daily identification of each
Receivable and all Collections of and adjustments to each existing Receivable).

     (c) Performance and Compliance with Contracts and Credit and Collection
Policy. The Servicer and, to the extent that it ceases to be the Servicer, Peabody,
shall (and shall cause the Originators to), at its expense, timely and fully perform and comply
with all material provisions, covenants and other promises required to be observed by it under the
Contracts related to the Receivables, and timely and fully comply in all material respects with the
Credit and Collection Policy with regard to each Receivable and the related Contract.

     (d) Extension or Amendment of Receivables. Except as provided in the
Agreement, the Servicer and, to the extent that it ceases to be the Servicer, Peabody, shall not
alter the delinquency status or adjust the Outstanding Balance or otherwise modify the terms of any
Pool Receivable in any material respect, or amend, modify or waive, in any material respect, any
term or condition of any related Contract (which term or condition relates to payments under, or
the enforcement of, such Contract).

     (e) Change in Business or Credit and Collection Policy. The Servicer and,
to the extent that it ceases to be the Servicer, Peabody, shall not make (and shall not permit the
Originators to make) any material change in the character of its business, other than Similar
Businesses, or any change in any Credit and Collection Policy that would have a Material Adverse
Effect. The Servicer and, to the extent that it ceases to be the Servicer, Peabody, shall not make
(and shall not permit the Originators to make) any other change in any Credit and Collection Policy
without giving prior written notice thereof to the Administrator and each Purchaser Agent.

IV-6

 

     (f) Audits. The Servicer and, to the extent that it ceases to be the
Servicer, Peabody, shall (and shall cause the Originators to), from time to time during regular
business hours as reasonably requested in advance (unless a Termination Event or Unmatured
Termination Event exists) by the Administrator or any Purchaser Agent, permit the Administrator or
its agents or representatives: (i) to examine and make copies of and abstracts from all books,
records and documents (including computer tapes and disks) in its possession or under its control
relating to Receivables and the Related Security, including the related Contracts; (ii) to visit
its offices and properties for the purpose of examining such materials described in clause
(i) above, and to discuss matters relating to Receivables and the Related Security or its
performance hereunder or under the Contracts with any of its officers, employees, agents or
contractors having knowledge of such matters and (iii), without limiting the clauses (i)
and (ii) above, to engage certified public accountants or other auditors acceptable to the
Servicer and the Administrator to conduct, at the Servicer’s expense, a review of the Servicer’s
books and records with respect to such Receivables, provided, that at any time when no Termination
Event exists and is continuing, the Servicer shall be required to reimburse the Administrator for
only one (1) such audit per year.

     (g) Change in Lock-Box Banks, Lock-Box Accounts and Payment Instructions to
Obligors. The Servicer and, to the extent that it ceases to be the Servicer, Peabody, shall
not (and shall not permit the Originators to) add or terminate any bank as a Lock-Box Bank or any
account as a Lock-Box Account from those listed in Schedule II to the Agreement, or make
any change in its instructions to Obligors regarding payments to be made to the Servicer or any
Lock-Box Account (or related post office box), unless the Administrator shall have received ten
(10) days advance written notice of assignment to a Permitted Lock-Box Bank and the Administrator
shall have received copies of all agreements and documents (including Lock-Box Agreements) that it
may request in connection therewith.

     (h) Deposits to Lock-Box Accounts. The Servicer shall: (i) instruct all
Obligors to make payments of all Receivables to one or more Lock-Box Accounts or to post office
boxes to which only Lock-Box Banks have access (and shall instruct the Lock-Box Banks to cause all
items and amounts relating to such Receivables received in such post office boxes to be removed and
deposited into a Lock-Box Account on a daily basis); and (ii) deposit, or cause to be deposited,
any Collections received by it into Lock-Box Accounts not later than two (2) Business Days after
receipt thereof. Each Lock-Box Account shall at all times be subject to a Lock-Box Agreement.

     (i) Preservation of Security Interest. The Servicer shall (and shall cause
the Seller to) take any and all action as the Administrator may require to preserve and maintain
the perfection and priority of the ownership or security interest of the Administrator in the Pool
Assets pursuant to this Agreement.

     (j) Marking of Records. At its expense, the Servicer shall mark its master
data processing records relating to Pool Receivables and related Contracts with a legend evidencing
that such Receivables and related Contracts have been sold in accordance with the Agreement.

     (k) Navajo Project. Peabody shall notify the Administrator and each
Purchaser Agent if a Responsible Officer of Peabody obtains actual knowledge that the documents and

IV-7

 

agreements governing the Navajo Project are amended in any manner which would cause the
representations and warranties set forth in Section 2(p) to be incorrect or untrue in any
respect.

     (l) Reporting Requirements. Peabody shall provide to the Administrator and
each Purchaser Agent (in multiple copies, if requested by the Administrator or any Purchaser Agent)
the following:

     (i) as soon as available and in any event within 60 days after the end of the first
three quarters of each fiscal year of Peabody balance sheets of Peabody and the consolidated
Subsidiaries of Peabody as of the end of such quarter and statements of income, retained
earnings and cash flow of Peabody and the consolidated Subsidiaries of Peabody for the
period commencing at the end of the previous fiscal year and ending with the end of such
quarter, certified by the chief financial officer of Peabody;

     (ii) as soon as available and in any event within 120 days after the end of each fiscal
year of Peabody, a copy of the annual report for such year for Peabody and its consolidated
Subsidiaries, containing financial statements for such year audited by independent certified
public accountants of nationally recognized standing;

     (iii) together with the financial statements required in (i) and (ii) above, a
compliance certificate in substantially the form of Annex D signed by the senior
financial officer of the Seller or Peabody, or such other Person as may be acceptable to the
Administrator;

     (iv) as to the Servicer only, as soon as available and in any event not later than two
Business Days prior to the Monthly Settlement Date, an Information Package as of the most
recently completed calendar month or, if in the opinion of the Administrator reasonable
grounds for insecurity exist with respect to the collectibility of the Pool Receivables or
with respect to the Seller or Servicer’s performance or ability to perform its obligations
under the Agreement, within six Business Days of a request by the Administrator, an
Information Package for such periods as is specified by the Administrator (but in no event
more frequently than weekly);

     (v) as soon as possible and in any event within five days after becoming aware of the
occurrence of each Termination Event or Unmatured Termination Event, a statement of the
chief financial officer of Peabody setting forth details of such Termination Event or
Unmatured Termination Event and the action that such Person has taken and proposes to take
with respect thereto;

     (vi) promptly after the sending or filing thereof, copies of all reports that Peabody
sends to any of its security holders, and copies of all reports and registration statements
that Peabody or any Subsidiary files with the Securities and Exchange Commission or any
national securities exchange; provided, that any filings with the Securities and
Exchange Commission that have been granted “confidential” treatment shall be provided
promptly after such filings have become publicly available;

IV-8

 

     (vii) promptly after the filing or receiving thereof notice of and, upon the request of
the Administrator, copies of all reports and notices that Peabody or any Affiliate of
Peabody files under ERISA with the Internal Revenue Service, the Pension Benefit Guaranty
Corporation or the U.S. Department of Labor or that such Person or any of its Affiliates
receives from any of the foregoing or from any multiemployer plan (within the meaning of
Section 4001(a)(3) of ERISA) to which such Person or any Affiliate of Peabody is or was,
within the preceding five years, a contributing employer, in each case in respect of the
assessment of withdrawal liability or an event or condition that could,
in the aggregate, result in the imposition of liability on Peabody and/or any such
Affiliate;

     (viii) at least thirty days before any change in Peabody or any Originator’s name or
any other change requiring the amendment of UCC financing statements, a notice setting forth
such changes and the effective date thereof;

     (ix) promptly after a Responsible Officer of Peabody obtains knowledge thereof, notice
of any: (A) litigation, investigation or proceeding that may exist at any time between
Peabody or any of its Subsidiaries and any Governmental Authority that is reasonably likely
to have a Material Adverse Effect; (B) litigation or proceeding adversely affecting such
Person or any of its Subsidiaries in which the amount involved is $25,000,000 or more after
deducting (x) the amount with respect to which such Person or any such Subsidiary is insured
and with respect to which the insurer has assumed responsibility in writing, and (y) the
amount for which such Person or any such Subsidiary is otherwise indemnified if the terms of
indemnification are satisfactory to the Administrator or in which injunctive or similar
relief is sought; or (C) litigation or proceeding relating to any Transaction Document;

     (x) promptly after the occurrence thereof, notice of a material adverse change in the
business, operations, property or financial or other condition of Peabody and its
Subsidiaries taken as a whole, or any individual Material Originator;

          (xi) the occurrence of a default or any event of default under any other financing arrangement
evidencing $50,000,000 or more of indebtedness pursuant to which Peabody is a debtor or an obligor;
and

          (xii) such other information respecting the Receivables or the condition or operations,
financial or otherwise, of Peabody or any of its Affiliates as the Administrator or any Purchaser
Agent may from time to time reasonably request.

     3. Separate Existence. Each of the Seller and Peabody hereby acknowledges that the
Purchasers, the Purchaser Agents and the Administrator are entering into the transactions
contemplated by this Agreement and the other Transaction Documents in reliance upon the Seller’s
identity as a legal entity separate from Peabody and its Affiliates. Therefore, from and after the
date hereof, each of the Seller and Peabody shall take all steps specifically required by the
Agreement or reasonably required by the Administrator to continue the Seller’s identity as a

IV-9

 

separate legal entity and to make it apparent to third Persons that the Seller is an entity with
assets and liabilities distinct from those of Peabody and any other Person, and is not a division
of Peabody, its Affiliates or any other Person. Without limiting the generality of the foregoing
and in addition to and consistent with the other covenants set forth herein, each of the Seller and
Peabody shall take such actions as shall be required in order that:

     (a) The Seller will be a limited purpose limited liability company whose activities
are restricted in its certificate of formation to: (i) purchasing or otherwise acquiring from the
Originators or Peabody (or their Affiliates), owning, holding, granting security interests or
selling interests in Pool Assets (or other receivables originated by the Originators or their
Affiliates, and certain related assets), (ii) entering into agreements for the selling and
servicing of the Receivables Pool (or other receivables pools originated by the Originators or
their Affiliates), and (iii) conducting such other activities as are necessary or appropriate to
carry out such activities;

     (b) The Seller shall not engage in any business or activity except as set forth in
this Agreement nor incur any indebtedness or liability, other than as expressly permitted by the
Transaction Documents;

     (c) Not less than one of the Seller’s Directors (the “Independent Director”)
shall be a natural person who (A) for the five-year period prior to his or her appointment as
Independent Director has not been, and during the continuation of his or her service as Independent
Director is not: (i) an employee, director, stockholder, member, manager, partner or officer of the
Seller, Peabody or any of their respective Affiliates (other than his or her service as an
Independent Director of the Seller); (ii) a customer or supplier of the Seller, Peabody or any of
their respective
Affiliates (other than his or her service as an Independent Director of Seller); or (iii) any
member of the immediate family of a person described in clause (i) or (ii) above,
and (B) has, (i) prior experience as an Independent Director for a corporation or limited liability
company whose charter documents required the unanimous consent of all independent directors thereof
before such corporation or limited liability company could consent to the institution of bankruptcy
or insolvency proceedings against it or could file a petition seeking relief under any applicable
federal or state law relating to bankruptcy and (ii) at least three years of employment experience
with one or more entities that provide, in the ordinary course of their respective businesses,
advisory, management or placement services to issuers of securitization or structured finance
instruments, agreements or securities. Such Independent Director of the Seller shall have been
appointed as such in strict compliance with the Seller’s LLC Agreement. The Seller’s LLC Agreement
shall provide that (i) the Seller’s Board of Directors shall not approve, or take any other action
to cause the filing of, or join in any filing of, a voluntary bankruptcy or insolvency petition,
dissolution, liquidation, consolidation, merger, sale of all or substantially all of its assets,
assignment for the benefit of creditors, admit in writing its inability to pay its debts generally
as they become due, or to engage in any other business or activity with respect to the Seller
unless (x) there is at least one Independent Director then serving as a director of the Seller and
appointed pursuant to and in strict compliance with the Seller’s LLC Agreement, and (y) all such
Independent Directors of the Seller shall have approved the taking of such action in writing prior
to the taking of such action and (ii) such provision cannot be amended without the prior written
consent of the Independent Director and the Administrator;

IV-10

 

     (d) Upon the occurrence of any event that causes the Member to cease to be a member
of the Seller (other than (i) upon an assignment by the Member of all of its limited liability
company interest in the Seller and the admission of the transferee pursuant to Sections 21 and 23
of the LLC Agreement, or (ii) the resignation of the Member and the admission of an additional
member of the Seller pursuant to Sections 22 and 23 of the LLC Agreement), each person acting as an
Independent Director pursuant to Section 10 of the LLC Agreement shall, without any action of any
Person and simultaneously with the Member ceasing to be a member of the Seller, automatically be
admitted to the Seller as a Special Member and shall continue the Seller without dissolution. No
Special Member may resign from the Seller or transfer its rights as a Special Member unless (i) a
successor Special Member has been admitted to the Seller as Special Member by executing a
counterpart to the LLC Agreement, and (ii) such successor has also accepted its appointment as
Independent Director pursuant to Section 10 of the LLC Agreement; provided,
however, the Special Members shall automatically cease to be members of the Seller upon the
admission to the Seller of a substitute Member.

     (e) The Independent Director shall not at any time serve as a trustee in bankruptcy
for the Seller, Peabody or any Affiliate thereof;

     (f) Any employee, consultant or agent of the Seller will be compensated from the
Seller’s funds for services provided to the Seller. The Seller will not engage any agents other
than its attorneys, auditors and other professionals, and a servicer and any other agent
contemplated by the Transaction Documents for the Receivables Pool, which servicer will be fully
compensated for its services by payment of the Servicing Fee, and a manager, which manager will be
fully compensated from the Seller’s funds;

     (g) The Seller will contract with the Servicer to perform for the Seller all
operations required on a daily basis to service the Receivables Pool. The Seller will pay the
Servicer the Servicing Fee pursuant hereto. The Seller will not incur any material indirect or
overhead expenses for items shared with Peabody (or any other Affiliate thereof) that are not
reflected in the Servicing Fee. To the extent, if any, that the Seller (or any Affiliate thereof)
shares items of expenses not reflected in the Servicing Fee or the manager’s fee, such as legal,
auditing and other professional services, such expenses will be allocated to the extent practical
on the basis of actual use or the value of services rendered, and otherwise on a basis reasonably
related to the actual use or the value of services rendered; it being understood that Peabody shall
pay all expenses relating to the preparation, negotiation, execution and delivery of the
Transaction Documents, including legal, agency and other fees;

     (h) The Seller’s operating expenses will be paid by the Seller and not by Peabody or
any other Affiliate thereof;

     (i) All of the Seller’s business correspondence and other communications shall be
conducted in the Seller’s own name and on its own separate stationery;

     (j) The Seller’s books and records will be maintained separately from those of
Peabody and any other Affiliate thereof and any other Person;

IV-11

 

     (k) All financial statements of Peabody or any Affiliate thereof that are
consolidated to include Seller will contain detailed notes clearly stating that: (i) a special
purpose limited liability company exists as a Subsidiary of Peabody, and (ii) the Originators have
sold receivables and other related assets to the Contributor, which has contributed such
receivables and other related assets to such special purpose Subsidiary that, in turn, has sold
such receivables and other related assets to certain financial institutions and other entities;

     (l) The Seller’s assets will be maintained in a manner that facilitates their
identification and segregation from those of Peabody or any Affiliate thereof and any other Person;

     (m) The Seller will strictly observe organizational formalities in its dealings with
Peabody or any Affiliate thereof, and funds or other assets of the Seller will not be commingled
with those of Peabody or any Affiliate thereof except as permitted by the Agreement in connection
with servicing the Pool Receivables. The Seller shall not maintain joint bank accounts or other
depository accounts to which Peabody or any Affiliate thereof or any other Person has independent
access, and the Seller shall use separate invoices and checks from any other Person. The Seller is
not named, and has not entered into any agreement to be named, directly or indirectly, as a direct
or contingent beneficiary or loss payee on any insurance policy with respect to any loss relating
to the property of Peabody or any Subsidiary or other Affiliate of Peabody (other than the Seller)
The Seller will pay to the appropriate Affiliate the marginal increase or, in the absence of such
increase, the market amount of its portion of the premium payable with respect to any insurance
policy that covers the Seller and such Affiliate;

     (n) The Seller will maintain arm’s-length relationships with Peabody (and any
Affiliate thereof). Any Person that renders or otherwise furnishes services to the Seller will be
compensated by the Seller at market rates for such services it renders or otherwise furnishes to
the Seller. Neither the Seller nor Peabody will be or will hold itself out to be responsible for
the debts of the other or the decisions or actions respecting the daily business and affairs of the
other. The Seller and Peabody will immediately correct any known misrepresentation with respect to
the foregoing, and they will not operate or purport to operate as an integrated single economic
unit with respect to each other or in their dealing with any other entity;

     (o) Peabody shall not pay the salaries of Seller’s employees, if any;

     (p) The Seller does not and will not hold itself responsible for the obligations of
any other Person, and shall not guarantee or become liable for the debts of any other Person;

     (q) The Seller will conduct its business in its own name and shall hold itself out
as a separate entity from any other Person;

     (r) The Seller shall maintain a sufficient number of employees and adequate capital
in light of its contemplated business activities;

     (s) The Seller shall not acquire the obligations or securities of any of its
members; and

IV-12

 

     (t) The Seller shall not pledge its assets for the benefit of any other Person or
make any loans or advances to any other Person, except pursuant to the Transaction Documents.

IV-13

 

EXHIBIT V

TERMINATION EVENTS

     Each of the following shall be a “Termination Event”:

     (a) (i) the Seller, Peabody, any Originator or the Servicer (if Peabody or any of its
Affiliates) shall fail to perform or observe any term, covenant or agreement under the Agreement
(other than those terms, covenants or agreements contained in Exhibit IV, Sections 1(a),
1(l) (except clause (iv) thereof), 2(a), and 2(l) (except clause
(viii) thereof)) or any other Transaction Document and, except as otherwise provided herein,
such failure shall continue for five consecutive Business Days after knowledge or notice thereof,
(ii) the Seller or the Servicer shall fail to make when due any payment or deposit to be made by it
under the Agreement and such failure shall continue unremedied for one Business Day, (iii) Peabody
shall resign as Servicer, and no successor Servicer reasonably satisfactory to the Administrator
shall have been appointed, or (iv) the Seller, Peabody, any Originator or the Servicer (if Peabody
or any of its Affiliates) shall fail to perform or observe any term covenant or agreement in any of
Exhibit IV, Sections 1(a), 1(l) (except clause (iv) thereof), 2(a),
or 2(l) (except clause (viii) thereof) and, except as otherwise provided herein,
such failure shall continue for thirty days after knowledge or notice thereof;

     (b) Peabody (or any Affiliate thereof) shall fail to transfer to any successor Servicer when
required any rights pursuant to the Agreement that Peabody (or such Affiliate) then has as
Servicer;

     (c) any representation or warranty made or deemed made by the Seller, Peabody or any
Originator (or any of their respective officers) under or in connection with the Agreement or any
other Transaction Document, or any information or report delivered by the Seller, Peabody or any
Originator or the Servicer pursuant to the Agreement or any other Transaction Document, shall prove
to have been incorrect or untrue in any material respect when made or deemed made or delivered, and
shall remain incorrect or untrue for 10 Business Days after notice to the Seller or the Servicer of
such inaccuracy;

     (d) the Seller or the Servicer shall fail to deliver the Information Package pursuant to the
Agreement, and such failure shall remain unremedied for two Business Days;

     (e) the Agreement or any Investment or Reinvestment pursuant to the Agreement shall for any
reason: (i) cease to create a valid and enforceable perfected ownership or security interest in
each Pool Receivable, the Related Security and Collections with respect thereto, free and clear of
any Adverse Claim, or (ii) cease to create with respect to the Pool Assets, or the interest of the
Administrator with respect to such Pool Assets shall cease to be, a valid and enforceable first
priority perfected ownership or security interest, free and clear of any Adverse Claim;

     (f) the Seller, Peabody or any Originator shall generally not pay its debts as such debts
become due, or shall admit in writing its inability to pay its debts generally, or shall make a
general assignment for the benefit of creditors; or any proceeding shall be instituted by or
against the Seller, Peabody or any Originator seeking to adjudicate it as bankrupt or insolvent, or
seeking

V-1

 

liquidation, winding up, reorganization, arrangement, adjustment, protection, relief or
composition of it or its debts under any law relating to bankruptcy, insolvency or reorganization
or relief of debtors, or seeking the entry of an order for relief or the appointment of a receiver,
trustee, custodian or other similar official for it or for any substantial part of its property
and, in the case of any such proceeding instituted against it (but not instituted by it), either
such proceeding shall remain undismissed or unstayed for a period of 60 days, or any of the actions
sought in such proceeding (including the entry of an order for relief against, or the appointment
of a receiver, trustee, custodian or other similar official for, it or for any substantial part of
its property) shall occur; or the Seller, Peabody or any Originator shall take any corporate or
organizational action to authorize any of the actions set forth above in this paragraph;

     (g) (i) the (A) Default Ratio shall exceed 2.25% or (B) the Delinquency Ratio shall exceed
4.50% or (ii) the average for three consecutive calendar months of: (A) the Default Ratio shall
exceed 1.75%, (B) the Delinquency Ratio shall exceed 3.50% or (C) the Dilution Ratio shall exceed
2.50%;

     (h) a Change in Control shall occur;

     (i) at any time the Purchased Assets Coverage Percentage exceeds 100%, and such circumstance
shall not have been cured within two Business Days;

     (j) (i) the occurrence of any Event of Default under and as defined in the Credit Agreement,
provided that if the Credit Agreement is terminated but not replaced, the covenants in effect in
the Credit Agreement immediately prior to termination of the Credit Agreement shall be deemed to be
effective for the purposes of the Agreement; (ii) any other event shall occur or condition shall
exist under the Credit Agreement and shall continue after the applicable grace period, if any,
specified in such Credit Agreement if, in either case: (a) the effect of such non-payment, event
or condition is to give the applicable debtholders the right (whether acted upon or not) to
accelerate the maturity of such Debt, or (b) any such Debt shall be declared to be due and payable,
or required to be prepaid (other than by a regularly scheduled required prepayment), redeemed,
purchased or defeased, or an offer to repay, redeem, purchase or defease such Debt shall be
required to be made, in each case before the stated maturity thereof; (iii) in the event that the
Credit Agreement shall have terminated, and there exists any other financing arrangement evidencing
$25,000,000 or more of indebtedness pursuant to which Peabody is a debtor or an obligor (an
“Other Material Financing Agreement”); either (A) the occurrence of any event of default
under such Other Material Financing Agreement, or (B) any other event shall occur or condition
shall exist under and shall continue after the applicable grace period, if any, specified in such
Other Material Financing Agreement, if, in either case of (A) or (B): (i) the effect of such
non-payment, event or condition is to give the applicable debtholders the right (whether acted upon
or not) to accelerate the maturity of such Other Material Financing Agreement, or (b) any such
Other Material Financing Agreement shall be declared to be due and payable, or required to be
prepaid (other than by a regularly scheduled required prepayment), redeemed, purchased or defeased,
or an offer to repay, redeem, purchase or defease such Debt shall be required to be made, in each
case before the stated maturity thereof;

     (k) except as could not reasonably be expected, individually or in the aggregate, to have a
Material Adverse Effect, either: (i) a contribution failure shall occur with respect to any

V-2

 

Benefit Plan sufficient to give rise to a lien on any of the assets of Seller, any Originator,
Peabody or any ERISA Affiliate under Section 302(f) of ERISA, (ii) the Internal Revenue Service
shall file a notice of lien asserting a claim or claims pursuant to the Internal Revenue Code with
regard to any of the assets of Seller, any Originator, Peabody or any ERISA Affiliate and such lien
shall have been filed and not released within 10 days, or (iii) the Pension Benefit Guaranty
Corporation shall, or shall indicate its intention in writing to the Seller, any Originator,
Peabody or any ERISA Affiliate to, either file a notice of lien asserting a claim pursuant to ERISA
with regard to any assets of the Seller, any Originator, Peabody or any ERISA Affiliate or
terminate any Benefit Plan that has unfunded benefit liabilities, or any steps shall have been
taken to terminate any Benefit Plan subject to Title IV of ERISA so as to result in any liability
and such lien shall have been filed and not released within 10 days;

     (l) the Days’ Sales Outstanding exceed 40.0 days;

     (m) a default shall occur under the Intercreditor Agreement, or any Person shall attempt to
terminate or assert the invalidity or unenforceability of the Intercreditor Agreement or any
provision thereof; or

     (n) any Letter of Credit is drawn upon and, unless as a result of the LC Bank’s failure to
provide the notice required by Section 1.16(b), not fully reimbursed pursuant to
Section 1.16 (including, if applicable, with the proceeds of any funding by any Purchaser)
within two Business Days from the date of such draw.

V-3

 

SCHEDULE I

CREDIT AND COLLECTION POLICY

(Attached)

Schedule I-1

 

SCHEDULE II

LOCK-BOX BANKS AND LOCK-BOX ACCOUNTS

BANK: PNC BANK

               PITTSBURGH, PA

	 	 	 	 	 	 	 	 	 
	NAME OF ORIGINATOR	 	ACCOUNT NUMBER	 	LOCK-BOX NUMBER
	Powder River Coal, LLC

	 	 	1008971367	 	 	 	642396	 
	 
	 	 	 	 	 	 	 	 
	COALSALES II, LLC

	 	 	1008971287	 	 	 	642381	 
	 
	 	 	 	 	 	 	 	 
	COALTRADE, LLC

	 	 	1008971359	 	 	 	642406	 
	 
	 	 	 	 	 	 	 	 
	Peabody Western Coal Company

	 	 	1008971308	 	 	 	N/A   	 
	 
	 	 	 	 	 	 	 	 
	Arclar Company, LLC

	 	 	1017292948	 	 	 	643445	 
	 
	 	 	 	 	 	 	 	 
	Peabody Midwest Mining, LLC

	 	 	1017293238	 	 	 	643461	 
	 
	 	 	 	 	 	 	 	 
	Twentymile Coal, LLC

	 	 	1017307281	 	 	 	643625	 
	 
	 	 	 	 	 	 	 	 
	COALSALES, LLC

	 	 	1019275295	 	 	 	643772	 

Schedule II-1

 

SCHEDULE III

TRADE NAMES

None.

Schedule III-1

 

SCHEDULE IV

OFFICE LOCATIONS

The Principal Place of Business, Chief Executive Office and state of formation of the Seller is:

701 Market Street, St. Louis, Missouri 63101; Seller is a Delaware limited liability company

The Seller maintains its master books and records relating to Receivables at:

701 Market Street, St. Louis, Missouri 63101

The Principal Place of Business, Chief Executive Office and state of formation of Peabody is:

701 Market Street, St. Louis, Missouri 63101; Peabody is a Delaware corporation

Peabody maintains its master books and records relating to the Receivables at:

701 Market Street, St. Louis, Missouri 63101

The Principal Place of Business, Chief Executive Office and state of formation of Peabody Holding
Company, LLC is:

701 Market Street, St. Louis, Missouri 63101; Peabody Holding Company, LLC is a Delaware
limited liability company

Peabody Holding Company, LLC maintains its master books and records relating to the Receivables at:

701 Market Street, St. Louis, Missouri 63101

Schedule IV-1

 

ANNEX A

to Receivables Purchase Agreement

FORM OF INFORMATION PACKAGE

(Attached)

Annex A-1

 

ANNEX B

to Receivables Purchase Agreement

FORM OF INVESTMENT NOTICE

                                        , [20                    ]

PNC Bank, National Association

One PNC Plaza, 26th Floor

249 Fifth Avenue

Pittsburgh, PA 15222-2707

[Each Purchaser Agent]

Ladies and Gentlemen:

     Reference is hereby made to the Third Amended and Restated Receivables Purchase Agreement,
dated as of January 25, 2010 (as heretofore amended or supplemented, the “Receivables Purchase
Agreement”), among P&L Receivables Company, LLC (“Seller”), Peabody Energy Corporation,
as Servicer, the Persons from time to time party thereto as Sub-Servicers, the Persons from time to
time party thereto as Conduit Purchasers, Related Committed Purchasers, Purchaser Agents and LC
Participants, and PNC Bank National Association, as administrator (in such capacity, the
“Administrator”) and as the issuer of letters of credit thereunder (in such capacity, the
“LC Bank”). Capitalized terms used in this Investment Notice and not otherwise defined
herein shall have the meanings assigned thereto in the Receivables Purchase Agreement.

     [This letter constitutes an Investment Notice pursuant to Section 1.2(a) of the
Receivables Purchase Agreement. Seller requests that the Purchasers make an Investment in a pool
of receivables on                                         , [20                    ], in the amount of $          
                              .
Subsequent to this Investment, the Aggregate Capital will be $                                        .]1

     [This letter constitutes a notice pursuant to Section 1.14(a) of the Receivables
Purchase Agreement. Seller desires that LC Bank issue a Letter of Credit with a face amount of
$                    . Subsequent to this issuance, the LC Participation Amount will be $                     and the
Aggregate Capital will be $                    .]2

     Seller hereby represents and warrants as of the date hereof, and as of the date of such
[Investment] [issuance], as follows:

	 	(i)	 	the representations and warranties contained in Exhibit III to the
Receivables Purchase Agreement are true and correct in all material respects (except to
the extent that such representations and warranties expressly relate to an earlier
date,

 

			
	1	 	In the case of a Borrowing Request.
	 
	2	 	In the case of a request for an issuance of a
Letter of Credit. In the event of a request for the issuance of a Letter of
Credit, a Letter of Credit Application in the form of Annex E to the
Receivables Purchase Agreement must also be delivered by the Seller.

Annex B-1

 

	 	 	 	and in which case such representations and warranties are true and correct in all
material respects as of such earlier date);
	 
	 	(ii)	 	no event has occurred and is continuing, or would result from the Investment or
issuance requested hereby that constitutes a Termination Event;
	 
	 	(iii)	 	no Unmatured Termination Event exists and is continuing;
	 
	 	(iv)	 	the sum of the Aggregate Capital plus the LC Participation Amount, after giving
effect to the Investment or issuance requested hereby, will not exceed the Purchase
Limit;
	 
	 	(v)	 	after giving effect to the Investment or issuance requested hereby, the
Purchased Assets Coverage Percentage shall not exceed 100%; and
	 
	 	(vi)	 	the Facility Termination Date has not occurred.

Annex B-2

 

     IN WITNESS WHEREOF, the undersigned has caused this Investment Notice to be executed by its
duly authorized officer as of the date first above written.

	 	 	 	 	 
	 	P&L RECEIVABLES COMPANY, LLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

Annex B-3

 

	 	 	 	 	 

ANNEX C

to Receivables Purchase Agreement

FORM OF PAYDOWN NOTICE

                          , 20                    

PNC Bank, National Association

One PNC Plaza, 26th Floor

249 Fifth Avenue

Pittsburgh, Pennsylvania 15222-2707

[Each Purchaser Agent]

Ladies and Gentlemen:

     Reference is hereby made to the Third Amended and Restated Receivables Purchase Agreement,
dated as of January 25, 2010 (as amended, supplemented or otherwise modified, the “Receivables
Purchase Agreement”), among P&L Receivables Company, LLC, as Seller, Peabody Energy
Corporation, as Servicer, the Persons from time to time party thereto as Sub-Servicers, the Persons
from time to time party thereto as Conduit Purchasers, Related Committed Purchasers, Purchaser
Agents and LC Participants, and PNC Bank, National Association, as Administrator and as the LC
Bank. Capitalized terms used in this paydown notice and not otherwise defined herein shall have
the meanings assigned thereto in the Receivables Purchase Agreement.

     This letter constitutes a paydown notice pursuant to Section 1.6(f)(i) of the
Receivables Purchase Agreement. The Seller desires to reduce the Aggregate Capital on
                                        ,                     3 by the application of
$                                         in cash to
pay Capital and Discount to accrue (until such cash can be used to pay commercial paper notes) with
respect to such Capital, together with all costs related to such reduction of the Aggregate
Capital. Subsequent to this Paydown, the Aggregate Capital will be $                                        .

     IN WITNESS WHEREOF, the undersigned has caused this paydown notice to be executed by its duly
authorized officer as of the date first above written.

	 	 	 	 	 
	 	P&L RECEIVABLES COMPANY, LLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

 

			
	3	 	Notice must be given at least five Business
Days’ prior to the requested paydown date, in the case of reductions in excess
of $20,000,000, or at least two Business Days’ prior to the requested paydown
date, in the case of reductions of $20,000,000 or less.

Annex C-1

 

ANNEX D

to Receivables Purchase Agreement

FORM OF COMPLIANCE CERTIFICATE

To: PNC Bank, National Association, as Administrator, and [each Purchaser Agent]

     This Compliance Certificate is furnished pursuant to that certain Third Amended and Restated
Receivables Purchase Agreement, dated as of January 25, 2010, by and among P&L Receivables Company,
LLC (“Seller”), Peabody Energy Corporation (the “Servicer”), the Persons from time
to time party thereto as Sub-Servicers, the Persons from time to time party thereto as Conduit
Purchasers, Related Committed Purchasers, Purchaser Agents and LC Participants, and PNC Bank,
National Association (the “Administrator”) and as the LC Bank (the “Agreement”).
Capitalized terms used herein and not otherwise defined herein shall have the meanings assigned to
them in the Agreement.

     THE UNDERSIGNED HEREBY CERTIFIES THAT:

     1. I am the duly elected                                          of Seller.

     2. I have reviewed the terms of the Agreement and I have made, or have caused to be made under
my supervision, a detailed review of the transactions and condition of Seller during the accounting
period covered by the attached financial statements.

     3. The examinations described in paragraph 2 did not disclose, and I have no knowledge of, the
existence of any condition or event which constitutes a Termination Event or an Unmatured
Termination Event, as each such term is defined under the Agreement, during or at the end of the
accounting period covered by the attached financial statements or as of the date of this
Certificate, except as set forth in paragraph 5 below.

     4. Schedule I attached hereto sets forth financial data and computations evidencing the
compliance with certain covenants of the Agreement (and the Credit Agreement), all of which data
and computations are true, complete and correct.

     5. Described below are the exceptions, if any, to paragraph 3 by listing, in detail, the
nature of the condition or event, the period during which it has existed and the action which
Seller has taken, is taking, or proposes to take with respect to each such condition or event:

Annex D-1

 

The foregoing certifications, together with the computations set forth in Schedule I hereto and the
financial statements delivered with this Certificate in support hereof, are made and delivered this
                     day of                                         , 20      .

	 	 	 	 	 
	P&L RECEIVABLES COMPANY, LLC

 	 	 
	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 

Annex D-1

 

	 	 	 	 	 

SCHEDULE I TO COMPLIANCE CERTIFICATE

     A. Schedule of Compliance as of                                         , 20          
with Section(s)                      of the
Agreement. Unless otherwise defined herein, the terms used in this Compliance Certificate have the
meanings ascribed thereto in the Agreement.

     This schedule relates to the month ended:                                        

Annex D-1

 

ANNEX E

to Receivables Purchase Agreement

FORM OF LETTER OF CREDIT APPLICATION

(Attached)

Annex E-1

 

ANNEX F

to Receivables Purchase Agreement

FORM OF ASSUMPTION AGREEMENT

Dated as of [__________ __, 20__]

     THIS ASSUMPTION AGREEMENT (this “Agreement”), dated as of [______ ___, ___], is among
P&L RECEIVABLES COMPANY, LLC (the “Seller”), [___], as purchaser (the “[___] Conduit
Purchaser”), [___], as the related committed purchaser (the “[___] Related Committed
Purchaser”), [___], as related lc participant (the “[___] LC Participant” and together with
the Conduit Purchaser and the Related Committed Purchaser, the “[___] Purchasers”), and
[___], as agent for the [___] Purchasers (the “[___] Purchaser Agent” and together with
the [___] Purchasers, the “[___] Purchaser Group”).

BACKGROUND

     The Seller and various others are parties to that certain Third Amended and Restated
Receivables Purchase Agreement dated as of January 25, 2010 (as amended, restated, supplemented or
otherwise modified through the date hereof, the “Receivables Purchase Agreement”).
Capitalized terms used and not otherwise defined herein have the respective meaning assigned to
such terms in the Receivables Purchase Agreement.

     NOW, THEREFORE, the parties hereto hereby agree as follows:

     SECTION 1. This Agreement constitutes an Assumption Agreement pursuant to Section
1.4(g) of the Receivables Purchase Agreement. The Seller desires [the [___] Purchasers] [the
[___] Related Committed Purchaser] [the [___] related LC Participant] to [become Purchasers
under] [increase its existing Commitment under] the Receivables Purchase Agreement and upon the
terms and subject to the conditions set forth in the Receivables Purchase Agreement, the [___]
Purchasers agree to [become Purchasers thereunder] [increase its Commitment in an amount equal to
the amount set forth as the “Commitment” under the signature of such [___] Related Committed
Purchaser hereto] [increase its Commitment in an amount equal to the amount set forth as the
“Commitment” under the signature of such [___] related LC Participant hereto].

     Seller hereby represents and warrants to the [___] Purchasers as of the date hereof, as
follows:

     (i) the representations and warranties of the Seller contained in Exhibit III of the
Receivables Purchase Agreement are true and correct in all material respects on and as the date
hereof as though made on and as of such date (except for representations and warranties which

Annex F-1

 

apply as to an earlier date, in which case such representations and warranties shall be true and correct
as of such earlier date);

     (ii) no event has occurred and is continuing that constitutes a Termination Event or an
Unmatured Termination Event; and

     (iii) the Facility Termination Date has not occurred.

     SECTION 2. Upon execution and delivery of this Agreement by the Seller and each member of the
[___] Purchaser Group, satisfaction of the other conditions to assignment specified in
Section 1.4(g) of the Receivables Purchase Agreement (including the written consent of the
Administrator and each Purchaser Agent) and receipt by the Administrator and Seller of counterparts
of this Agreement (whether by facsimile or otherwise) executed by each of the parties hereto, [the
[___] Purchasers shall become a party to, and have the rights and obligations of Purchasers
under, the Receivables Purchase Agreement][the [___] Related Committed Purchaser
shall increase its Commitment in the amount set forth as the “Commitment” under the signature
of the [___] Related Committed Purchaser hereto][the [___] related LC Participant shall
increase its Commitment in the amount set forth as the “Commitment” under the signature of the
[___] related LC Participant hereto].

     SECTION 3. Each party hereto hereby covenants and agrees that it will not institute against,
or join any other Person in instituting against, any Conduit Purchaser, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceeding, or other proceeding under any
federal or state bankruptcy or similar law, for one year and one day after the latest maturing Note
issued by such Conduit Purchaser is paid in full. The covenant contained in this paragraph shall
survive any termination of the Receivables Purchase Agreement.

     SECTION 4. THIS AGREEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE
INTERNAL LAWS OF THE STATE OF ILLINOIS EXCEPT TO THE EXTENT THAT THE VALIDITY OR PERFECTION OF A
SECURITY INTEREST OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY
THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF ILLINOIS. This Agreement may not be amended,
supplemented or waived except pursuant to a writing signed by the party to be charged. This
Agreement may be executed in counterparts, and by the different parties on different counterparts,
each of which shall constitute an original, but all together shall constitute one and the same
agreement.

(continued on following page)

Annex F-2

 

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement by their duly authorized
officers as of the date first above written.

	 	 	 	 	 	 	 
	 	 	[___________], as a Conduit Purchaser
	 
	 	 	 	 	 	 
	 

	 	By: 

	 

	 	 	 	Name Printed:	 	 
	 

	 	 	Title:	 	 	 
	 
	 	 	 	 	 	 
	 	 	[Address]	 	 
	 
	 	 	 	 	 	 
	 	 	[___________], as a Related Committed Purchaser
	 
	 	 	 	 	 	 
	 

	 	By: 

	 

	 	 	 	Name Printed:	 	 
	 

	 	 	Title:	 	 	 
	 
	 	 	 	 	 	 
	 	 	[Address]	 	 
	 	 	[Commitment]	 	 
	 
	 	 	 	 	 	 
	 	 	[___________], as a related LC Participant
	 
	 	 	 	 	 	 
	 

	 	By: 

	 

	 	 	 	Name Printed:	 	 
	 

	 	 	Title:	 	 	 
	 
	 	 	 	 	 	 
	 	 	[Address]	 	 
	 	 	[Commitment]	 	 
	 
	 	 	 	 	 	 
	 	 	[_____________], as Purchaser Agent for [_________]
	 
	 	 	 	 	 	 
	 

	 	By: 

	 

	 	 	 	Name Printed:	 	 
	 

	 	 	Title:	 	 	 
	 
	 	 	 	 	 	 
	 	 	[Address]	 	 

Annex F-3

 

	 	 	 	 	 	 	 
	P&L RECEIVABLES COMPANY, as Seller
	 
	 	 	 	 	 	 
	By:
	 	 	 	 	 	 
	 	 	 	 
	 	Name Printed:	 	 
	 	Title:
	 	 	 	 	 
	 
	 	 	 	 	 	 
	Consented and Agreed:	 	 
	 
	 	 	 	 	 	 
	PNC BANK, NATIONAL ASSOCIATION, as Administrator
	 
	 	 	 	 	 	 
	By:
	 	 	 	 	 	 
	 	 	 	 
	 	Name Printed:	 	 
	 	Title:
	 	 	 	 	 
	 
	 	 	 	 	 	 
	Address:	 	PNC Bank, National Association

One PNC Plaza

249 Fifth Avenue

Pittsburgh, Pennsylvania 15222-2707
	 
	 	 	 	 	 	 
	PNC BANK, NATIONAL ASSOCIATION, as LC Bank
	 
	 	 	 	 	 	 
	By:
	 	 	 	 	 	 
	 	 	 	 
	 	Name Printed:	 	 
	 	Title:
	 	 	 	 	 
	 
	 	 	 	 	 	 
	Address:	 	PNC Bank, National Association

500 First Avenue

Third Floor

Pittsburgh, Pennsylvania 15219
	 
	 	 	 	 	 	 
	[THE PURCHASER AGENTS]	 	 
	 
	 	 	 	 	 	 
	By:
	 	 	 	 	 	 
	 	 	 	 
	 	Name Printed:	 	 
	 	Title:
	 	 	 	 	 
	 
	 	 	 	 	 	 
	[Address]	 	 	 	 

Annex F-4

 

ANNEX G

to Receivables Purchase Agreement

FORM OF TRANSFER SUPPLEMENT

Dated as of [                             , 20        ]

Section 1.

	 	 	 
	Commitment assigned:

	 	$                    
	Assignor’s remaining Commitment:

	 	$                    
	Capital allocable to Commitment assigned:

	 	$                    
	Assignor’s remaining Capital:

	 	$                    
	Discount (if any) allocable to
Capital assigned:

	 	$                    
	Discount (if any) allocable to Assignor’s
remaining Capital:

	 	$                    

Section 2.

     Effective Date of this Transfer Supplement: [                    ]

     Upon execution and delivery of this Transfer Supplement by transferee and transferor and the
satisfaction of the other conditions to assignment specified in Section 5.3(c) of the
Receivables Purchase Agreement (as defined below), from and after the effective date specified
above, the transferee shall become a party to, and have the rights and obligations of a Related
Committed Purchaser under, the Third Amended and Restated Receivables Purchase Agreement, dated as
of January 25, 2010 (as amended, restated, supplemented or otherwise modified through the date
hereof, the “Receivables Purchase Agreement”), among P&L Receivables Company, LLC, as Seller,
Peabody Energy Corporation, as initial Servicer, the various Sub-Servicers, Purchasers and
Purchaser Agents from time to time party thereto, and PNC Bank, National Association, as
Administrator and as LC Bank.

Annex G-1

 

ASSIGNOR: [                    ], as a Related Committed Purchaser

	 	 	 	 	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

ASSIGNEE: [                    ], as a Purchasing Related Committed Purchaser

	 	 	 	 	 
	 	 	 
	 	By:  	
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	 	[Address]	 
	 

Accepted as of date first above
written:

[                                 ], as Purchaser Agent for

the [                    ] Purchaser Group

	 	 	 	 	 
	 	 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

Annex G-2

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