Document:

Exhibit 10.3

 

Execution
Version

 

 

$250,000,000

SECOND LIEN CREDIT AGREEMENT

 

among

 

SIX FLAGS ENTERTAINMENT
CORPORATION (FORMERLY KNOWN AS SIX FLAGS, INC.),

 

SIX FLAGS OPERATIONS INC.,

 

SIX FLAGS THEME PARKS INC., 

as Borrower,

 

The Several Lenders

from Time to Time Parties Hereto,

 

GOLDMAN SACHS LENDING
PARTNERS LLC,

as Syndication Agent,

 

GOLDMAN SACHS LENDING
PARTNERS LLC,

as Documentation Agent,

 

and

 

GOLDMAN SACHS LENDING
PARTNERS LLC,

as Administrative Agent,

 

Dated as of April 30, 2010

 

 

GOLDMAN SACHS LENDING
PARTNERS LLC,

as Sole Bookrunner and Sole
Lead Arranger

 

 

TABLE
OF CONTENTS

 

	
  SECTION 1.

  	
  DEFINITIONS

  	
  1

  
	
  1.1.

  	
  Defined
  Terms

  	
  1

  
	
  1.2.

  	
  Other
  Definitional Provisions

  	
  33

  
	
   

  	
   

  	
   

  
	
  SECTION 2.

  	
  AMOUNT
  AND TERMS OF COMMITMENTS

  	
  34

  
	
  2.1.

  	
  Commitments

  	
  34

  
	
  2.2.

  	
  Procedure
  for Borrowing

  	
  34

  
	
  2.3.

  	
  Repayment
  of Loans

  	
  34

  
	
   

  	
   

  	
   

  
	
  SECTION 3.

  	
  CERTAIN
  PROVISIONS APPLICABLE TO THE LOANS

  	
  34

  
	
  3.1.

  	
  Repayment
  of Loans; Evidence of Debt

  	
  34

  
	
  3.2.

  	
  Fees

  	
  35

  
	
  3.3.

  	
  Optional
  Prepayments

  	
  35

  
	
  3.4.

  	
  Mandatory
  Prepayments

  	
  35

  
	
  3.5.

  	
  Conversion
  and Continuation Options

  	
  37

  
	
  3.6.

  	
  Minimum
  Amounts and Maximum Number of Eurocurrency Tranches

  	
  37

  
	
  3.7.

  	
  Interest
  Rates; Payment Dates; Prepayment Premium

  	
  38

  
	
  3.8.

  	
  Computation
  of Interest and Fees

  	
  38

  
	
  3.9.

  	
  Inability
  to Determine Interest Rate

  	
  39

  
	
  3.10.

  	
  Pro
  Rata Treatment and Payments

  	
  39

  
	
  3.11.

  	
  Requirements
  of Law

  	
  40

  
	
  3.12.

  	
  Taxes

  	
  42

  
	
  3.13.

  	
  Indemnity

  	
  44

  
	
  3.14.

  	
  Illegality

  	
  44

  
	
  3.15.

  	
  Change
  of Lending Office

  	
  44

  
	
  3.16.

  	
  Replacement
  of Lenders under Certain Circumstances

  	
  45

  
	
  3.17.

  	
  Loan
  Auctions

  	
  45

  
	
  3.18.

  	
  Auction
  Procedures

  	
  46

  
	
   

  	
   

  	
   

  
	
  SECTION 4.

  	
  REPRESENTATIONS
  AND WARRANTIES

  	
  47

  
	
  4.1.

  	
  Financial
  Condition

  	
  47

  
	
  4.2.

  	
  No
  Change

  	
  48

  
	
  4.3.

  	
  Existence;
  Compliance with Law

  	
  48

  
	
  4.4.

  	
  Corporate
  Power; Authorization; Enforceable Obligations

  	
  48

  
	
  4.5.

  	
  No
  Legal Bar

  	
  49

  
	
  4.6.

  	
  Litigation

  	
  49

  
	
  4.7.

  	
  No
  Default

  	
  49

  
	
  4.8.

  	
  Ownership
  of Property; Liens

  	
  49

  
	
  4.9.

  	
  Intellectual
  Property

  	
  50

  
	
  4.10.

  	
  Taxes

  	
  50

  
	
  4.11.

  	
  Federal
  Regulations

  	
  50

  
	
  4.12.

  	
  Labor
  Matters

  	
  50

  
	
  4.13.

  	
  ERISA

  	
  51

  
	
  4.14.

  	
  Investment
  Company Act; Other Regulations

  	
  52

  

 

 

	
  4.15.

  	
  Subsidiaries

  	
  52

  
	
  4.16.

  	
  Use
  of Proceeds

  	
  52

  
	
  4.17.

  	
  Environmental
  Matters

  	
  52

  
	
  4.18.

  	
  Accuracy
  of Information, Etc.

  	
  53

  
	
  4.19.

  	
  Security
  Documents

  	
  54

  
	
  4.20.

  	
  Solvency

  	
  54

  
	
  4.21.

  	
  Regulation
  H

  	
  54

  
	
  4.22.

  	
  Parks

  	
  55

  
	
   

  	
   

  	
   

  
	
  SECTION 5.

  	
  CONDITIONS
  PRECEDENT

  	
  55

  
	
  5.1.

  	
  Conditions
  Precedent to Loans

  	
  55

  
	
   

  	
   

  	
   

  
	
  SECTION 6.

  	
  AFFIRMATIVE
  COVENANTS

  	
  60

  
	
  6.1.

  	
  Financial
  Statements and Other Information

  	
  60

  
	
  6.2.

  	
  Notices
  of Material Events

  	
  63

  
	
  6.3.

  	
  Existence,
  Etc.

  	
  64

  
	
  6.4.

  	
  Insurance

  	
  65

  
	
  6.5.

  	
  Compliance
  with Contractual Obligations and Requirements of Law

  	
  65

  
	
  6.6.

  	
  Additional
  Collateral, Etc.

  	
  65

  
	
  6.7.

  	
  Further
  Assurances

  	
  68

  
	
  6.8.

  	
  Environmental
  Laws

  	
  69

  
	
  6.9.

  	
  Ratings
  by S&P and Moody’s

  	
  69

  
	
   

  	
   

  	
   

  
	
  SECTION 7.

  	
  NEGATIVE
  COVENANTS

  	
  69

  
	
  7.1.

  	
  Senior
  Secured Leverage Ratio

  	
  69

  
	
  7.2.

  	
  Consolidated
  Interest Coverage Ratio

  	
  70

  
	
  7.3.

  	
  Indebtedness

  	
  70

  
	
  7.4.

  	
  Liens

  	
  74

  
	
  7.5.

  	
  Prohibition
  of Fundamental Changes

  	
  77

  
	
  7.6.

  	
  Restricted
  Payments

  	
  82

  
	
  7.7.

  	
  Capital
  Expenditures

  	
  84

  
	
  7.8.

  	
  Investments

  	
  85

  
	
  7.9.

  	
  Prepayment
  of Certain Indebtedness

  	
  87

  
	
  7.10.

  	
  Transactions
  with Affiliates

  	
  88

  
	
  7.11.

  	
  Changes
  in Fiscal Periods

  	
  89

  
	
  7.12.

  	
  Certain
  Restrictions

  	
  89

  
	
  7.13.

  	
  Lines
  of Business

  	
  89

  
	
  7.14.

  	
  Modifications
  of Certain Documents

  	
  90

  
	
  7.15.

  	
  Limitation
  on Activities of Parent and Holdings

  	
  90

  
	
  7.16.

  	
  Limitation
  on Hedging Agreements

  	
  91

  
	
   

  	
   

  	
   

  
	
  SECTION 8.

  	
  EVENTS
  OF DEFAULT

  	
  91

  
	
   

  	
   

  	
   

  
	
  SECTION 9.

  	
  THE
  AGENTS

  	
  95

  
	
  9.1.

  	
  Appointment

  	
  95

  
	
  9.2.

  	
  Delegation
  of Duties

  	
  95

  
	
  9.3.

  	
  Exculpatory
  Provisions

  	
  95

  

 

ii

 

	
  9.4.

  	
  Reliance
  by Agents

  	
  96

  
	
  9.5.

  	
  Notice
  of Default

  	
  96

  
	
  9.6.

  	
  Non-Reliance
  on Agents and Other Lenders

  	
  96

  
	
  9.7.

  	
  Indemnification

  	
  97

  
	
  9.8.

  	
  Agent
  in Its Individual Capacity

  	
  97

  
	
  9.9.

  	
  Successor
  Agents

  	
  98

  
	
  9.10.

  	
  Authorization
  to Release Liens and Guarantees

  	
  98

  
	
  9.11.

  	
  Authorization
  to Enter into Intercreditor Agreement

  	
  98

  
	
  9.12.

  	
  The
  Arranger, Syndication Agent and Documentation Agent

  	
  98

  
	
  9.13.

  	
  Withholding
  Taxes

  	
  98

  
	
   

  	
   

  	
   

  
	
  SECTION 10.

  	
  MISCELLANEOUS

  	
  99

  
	
  10.1.

  	
  Amendments
  and Waivers

  	
  99

  
	
  10.2.

  	
  Notices

  	
  101

  
	
  10.3.

  	
  No
  Waiver; Cumulative Remedies

  	
  102

  
	
  10.4.

  	
  Survival
  of Representations and Warranties

  	
  102

  
	
  10.5.

  	
  Payment
  of Expenses

  	
  102

  
	
  10.6.

  	
  Successors
  and Assigns; Participations and Assignments

  	
  104

  
	
  10.7.

  	
  Adjustments;
  Set-off

  	
  107

  
	
  10.8.

  	
  U.S.A. Patriot Act

  	
  108

  
	
  10.9.

  	
  Counterparts

  	
  108

  
	
  10.10.

  	
  Severability

  	
  108

  
	
  10.11.

  	
  Integration

  	
  108

  
	
  10.12.

  	
  GOVERNING
  LAW

  	
  108

  
	
  10.13.

  	
  Submission
  To Jurisdiction; Waivers

  	
  108

  
	
  10.14.

  	
  Acknowledgments

  	
  109

  
	
  10.15.

  	
  Confidentiality

  	
  109

  
	
  10.16.

  	
  Release
  of Collateral and Guarantee Obligations

  	
  110

  
	
  10.17.

  	
  Accounting
  Changes

  	
  111

  
	
  10.18.

  	
  Delivery
  of Lender Addenda

  	
  111

  
	
  10.19.

  	
  WAIVERS
  OF JURY TRIAL

  	
  111

  
	
  10.20.

  	
  Intercreditor
  Agreement

  	
  111

  

 

iii

 

	
  SCHEDULES:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  1.1(a)

  	
  Mortgaged
  Property

  	
   

  
	
  4.4

  	
  Consents,
  Authorizations, Filings and Notices

  	
   

  
	
  4.8

  	
  Material
  Real Properties

  	
   

  
	
  4.13

  	
  ERISA

  	
   

  
	
  4.15

  	
  Subsidiaries

  	
   

  
	
  4.19(a)-1

  	
  UCC
  Filing Jurisdictions

  	
   

  
	
  4.19(a)-2

  	
  UCC
  Financing Statements to Remain on File

  	
   

  
	
  4.19(a)-3

  	
  UCC
  Financing Statements to be Terminated

  	
   

  
	
  4.19(b)

  	
  Mortgage
  Filing Jurisdictions

  	
   

  
	
  4.21

  	
  Mortgaged
  Properties in Flood Zones

  	
   

  
	
  4.22

  	
  Existing
  Parks

  	
   

  
	
  7.3(b)

  	
  Existing
  Indebtedness

  	
   

  
	
  7.4(b)

  	
  Liens

  	
   

  
	
  7.8(a)

  	
  Existing
  Investments

  	
   

  
	
  7.13

  	
  Business
  Activities

  	
   

  
	
   

  	
   

  	
   

  
	
  EXHIBITS:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  A

  	
  Form of
  Second Lien Guarantee and Collateral Agreement

  	
   

  
	
  B

  	
  Form of
  Compliance Certificate

  	
   

  
	
  C

  	
  Form of
  Closing Certificate

  	
   

  
	
  D

  	
  [Reserved]

  	
   

  
	
  E

  	
  Form of
  Assignment and Acceptance

  	
   

  
	
  F

  	
  Form of
  Legal Opinion of Paul, Hastings,
  Janofsky & Walker LLP

  	
   

  
	
  G

  	
  Form of
  Note

  	
   

  
	
  H

  	
  Form of
  Prepayment Option Notice

  	
   

  
	
  I

  	
  Form of
  Exemption Certificate

  	
   

  
	
  J

  	
  Form of
  Lender Addendum

  	
   

  
	
  K

  	
  Form of
  Borrowing Notice

  	
   

  
	
  L

  	
  Form of
  Auction Notice

  	
   

  
	
  M

  	
  Form of
  Return Bid

  	
   

  
	
  N

  	
  Form of
  Intercompany Subordinated Note

  	
   

  
	
  O

  	
  Form of Intercreditor
  Agreement

  	
   

  

 

iv

 

SECOND LIEN CREDIT AGREEMENT, dated as of April 30,
2010, among SIX FLAGS ENTERTAINMENT CORPORATION (formerly known as SIX FLAGS,
INC.), a Delaware corporation (“Parent”), SIX FLAGS OPERATIONS INC., a
Delaware corporation (“Holdings”), SIX FLAGS THEME PARKS INC., a
Delaware corporation (the “Borrower”), the several banks and other financial
institutions or entities from time to time parties to this Agreement (as
defined below) (the “Lenders”) and GOLDMAN SACHS LENDING PARTNERS LLC,
as administrative agent (in such capacity, the “Administrative Agent”).

 

WHEREAS, on June 13, 2009, Parent, Holdings,
the Borrower and certain of the Borrower’s Domestic Subsidiaries (together with
Parent, Holdings and the Borrower, the “Debtors”) filed a voluntary
petition for relief, Case No. 09-12019, under Chapter 11 of Title 11 of
the Bankruptcy Code in the United States Bankruptcy Court for the District of
Delaware (the “Bankruptcy Court”) and continued in the possession of
their property and in the management of their businesses pursuant to Sections
1107 and 1108 of the Bankruptcy Code;

 

WHEREAS, on April 29, 2010, the Bankruptcy
Court entered the Confirmation Order confirming the Debtors’ Modified Fourth
Amended Joint Plan of Reorganization Under Chapter 11 of the Bankruptcy Code,
dated April 1, 2010 (as in effect on the date of confirmation thereof and as
thereafter may be amended as provided in this Agreement, the “Plan of
Reorganization”); and

 

WHEREAS, in connection with the confirmation and
implementation of the Plan of Reorganization, the reorganized Debtors have
requested the Lenders to make a loan of $250,000,000 to them on the Closing
Date to enable the reorganized Debtors to, among other things, consummate the
transactions contemplated by the Plan of Reorganization, pay related fees and
expenses and finance the working capital needs and general corporate purposes
of the Borrower, and the Lenders have agreed, subject to the terms and
conditions hereof, to enter into this Agreement.

 

Accordingly, the parties hereto hereby agree as
follows:

 

SECTION 1.           DEFINITIONS

 

1.1.          Defined Terms.  As used in this Agreement, the terms listed
in this Section 1.1 shall have the respective meanings set forth in this Section 1.1.

 

“Accepting Lenders”:
as defined in Section 3.10(d).

 

“Accounting Changes”:
as defined in Section 10.17.

 

“Acquisition”:  any acquisition, whether in a single
transaction or series of related transactions, by Parent or any one or more of
its Subsidiaries of (a) all or a substantial part of the assets, or of a
business, unit or division, of any Person, whether through purchase of assets
or securities, by merger or otherwise; or (b) any Person that becomes a
Subsidiary after giving effect to such acquisition.

 

 

“Acquisition Parties”:
SFOG Acquisition A, Inc., a Delaware corporation, SFOG Acquisition B,
L.L.C., a Delaware limited liability company, SFOT Acquisition I, Inc., a
Delaware corporation, and SFOT Acquisition II, Inc., a Delaware
corporation.

 

“Additional Extensions of
Credit”: as defined in Section 10.1.

 

“Administrative Agent”:  as defined in the preamble hereto.

 

“Affiliate”:  any Person that directly or indirectly
controls, or is under common control with, or is controlled by, Parent and, if
such Person is an individual, any member of the immediate family (including
parents, spouse, children) of such individual and any trust whose principal
beneficiary is such individual or one or more members of such immediate family
and any Person who is controlled by any such member or trust. As used in this
definition, “control” (including, with its correlative meanings, “controlled by”
and “under common control with”) means possession, directly or indirectly, of
power to direct or cause the direction of management or policies (whether
through ownership of securities or partnership or other ownership interests, by
contract or otherwise). Notwithstanding the foregoing, (a) no individual
shall be an Affiliate solely by reason of his or her being a director, officer
or employee of Parent, Holdings or any of its Subsidiaries and (b) none of
the Wholly Owned Subsidiaries of Holdings or HWP shall be Affiliates.

 

“Agents”:  the collective reference to the Documentation
Agent, the Syndication Agent and the Administrative Agent.

 

“Agreement”:  this Second Lien Credit Agreement, as
amended, supplemented or otherwise modified from time to time.

 

“Applicable Discount”:
as defined in Section 3.18(c).

 

“Applicable Margin”:  (a) in the case of Loans which are Base
Rate Loans, 6.25% and (b) in the case of Loans which are Eurocurrency
Loans, 7.25%.

 

“Approved Fund”:  as defined in Section 10.6(b).

 

“Arranger”:  Goldman Sachs Lending Partners LLC, in its
capacity as sole lead arranger.

 

“Asset Sale”:  any Disposition of Property or series of
related Dispositions of Property (excluding any such Disposition permitted by
clauses (i) through (vi) and clauses (ix) through (xii) and
clauses (xiv) through (xvii) of Section 7.5(c) except for clause (ii) to
the extent referred to therein) which yields gross proceeds to the Parent, or
any of its Subsidiaries (valued at the initial principal amount thereof in the
case of non-cash proceeds consisting of notes or other debt securities and
valued at fair market value in the case of other non-cash proceeds) in excess
of $2,500,000.

 

“Assignee”:  as defined in Section 10.6(b)(i).

 

2

 

“Assignment and
Acceptance”:  an Assignment and
Acceptance substantially in the form of Exhibit E.

 

“Auction”: a “Dutch”
auction whereby the Borrower offers to purchase Loans pursuant to the auction
procedures set forth in Section 3.18.

 

“Auction Amount”: as
defined in Section 3.18(a).

 

“Auction Notice”: as
defined in Section 3.18(a).

 

“Bankruptcy Code”:  the Federal Bankruptcy Code of 1978, as
amended from time to time.

 

“Bankruptcy Court”:
as defined in the recitals hereto.

 

“Base Capital Expenditure
Amount”:  as defined in Section 7.7.

 

“Base Rate”:  for any day, a rate per annum (rounded
upwards, if necessary, to the next 1/100 of 1%) equal to the greatest of (a) the
Prime Rate in effect on such day, (b) the Federal Funds Effective Rate in
effect on such day plus 1⁄2 of 1% and (c) the Eurocurrency Rate for a one
month Interest Period beginning on such day (or if such day is not a Business
Day, the immediately preceding Business Day) plus 1%, provided
that, for the avoidance of doubt, the Eurocurrency Rate for any day shall be
the greater of (i) 2.0% and (ii) the offered rate which appears on
the page of the Reuters Screen which displays an average British Bankers
Association Interest Settlement Rate (such page currently being LIBOR01
page) for deposits (for delivery on the first day of such period) with a term
equivalent to such period in Dollars, determined as of approximately 11:00 a.m.
(London, England time) on such day.  Any
change in the Base Rate due to a change in the Prime Rate, the Federal Funds
Effective Rate or such Eurocurrency Rate shall be effective as of the opening
of business on the effective day of such change in the Prime Rate, the Federal
Funds Effective Rate or such Eurocurrency Rate, respectively.

 

“Base Rate Loans”:  Loans for which the applicable rate of
interest is based upon the Base Rate.

 

“Beneficial Share
Assignment Agreement”: the Beneficial Share Assignment Agreement, dated as
of April 1, 1998, by and between TW-SPV Co., GP Holdings, Inc. and
Parent (as successor Premier Parks Inc.), as the same may be amended on or
prior to the Closing Date and as the same may be further modified or amended at
any time from time to time, provided such modification or amendment does not
violate Section 7.14.

 

“Benefited Lender”:  as defined in Section 10.7(a).

 

“Board”:  the Board of Governors of the Federal Reserve
System of the United States (or any successor).

 

“Borrower”:  as defined in the preamble hereto.

 

3

 

“Borrower Consolidated
Adjusted EBITDA”: for any period, for the Borrower and its Subsidiaries
(determined on a consolidated basis without duplication in accordance with
GAAP) means Parent Consolidated Adjusted EBITDA plus (a) administrative
and other corporate charges of Parent that are not allocated to or paid by the
Borrower or its Subsidiaries and excluding (b) any portion of
Parent Consolidated Adjusted EBITDA (calculated on a net basis, taking into
account positive and negative items) attributable to any Person (other than the
Borrower or its Subsidiaries) to the extent that the Borrower or any of its
Subsidiaries is not the owner of the interests in, or recipients of the cash
received from, such Person.  The parties
hereby agree that the Borrower Consolidated Adjusted EBITDA for the fiscal quarter
ending (a) June 30, 2009 was $47,603,000, (b) September 30,
2009 was $190,348,000 and (c) December 31, 2009 was ($15,780,000).

 

“Business”:  as defined in Section 4.17(b).

 

“Business Day”:  (a) for all purposes other than as
covered by clause (b) below, a day other than a Saturday, Sunday or other
day on which commercial banks in New York City are authorized or required by
law to close and (b) with respect to all notices and determinations in
connection with, and payments of principal and interest on, Eurocurrency Loans,
any day which is a Business Day described in clause (a) and which is also
a day for trading by and between banks for deposits in Dollars in the London
Interbank Eurocurrency market.

 

“Cap Amount”:  $1.03 billion in the aggregate less all
mandatory payments of the principal of the First Lien Tranche B Term Loans and
any permanent reductions of the First Lien Revolving Credit Commitments
(specifically excluding, however, any such repayments and commitment reductions
occurring solely as a result of any Permitted First Lien Refinancing
Indebtedness permitted hereunder).

 

“Capex Stub Amount”:
as defined in the definition of “Excess Cash Flow”.

 

“Capital Expenditures”:  for any period, expenditures made in cash by
Parent or any of its Subsidiaries or any of the Partnership Park Entities (or,
for purposes of the definition of “Excess Cash Flow”, by the Borrower or any of
its Subsidiaries) to acquire or construct fixed assets, plant and equipment
(including renewals, improvements and replacements) during such period,
computed in accordance with GAAP, but excluding (a) repairs or
restorations in respect of any such assets paid in cash, (b) the amount of
cash expended (i) with, or in an amount equal to, the Net Cash Proceeds of
(A) Recovery Events or (B) awards of compensation arising from the
taking by eminent domain or condemnation of assets being replaced, (ii) as
part of an Acquisition permitted hereunder (other than an Acquisition permitted
by Section 7.5(b)(iii)), or (c) expenditures that are accounted for
as capital expenditures made in cash by Parent or any of its Subsidiaries
or any of the Partnership Park Entities (or, for purposes of the definition of “Excess
Cash Flow”, by the Borrower or any of its Subsidiaries) and that actually are
paid for by a Person other than Parent or any Subsidiary or any
Partnership Park Entity and (d) any non-cash compensation or other
non-cash costs reflected as additions to property, plant or equipment in the
consolidated balance sheet of Parent and its Subsidiaries or in the 

 

4

 

balance sheet of any
Partnership Park Entity (or, for purposes of the definition of “Excess Cash
Flow” in the consolidated balance sheet of the Borrower and its Subsidiaries).

 

“Capital Lease
Obligations”:  for any Person, all
obligations of such Person to pay rent or other amounts under a lease of (or
other agreement conveying the right to use) Property to the extent such
obligations are required to be classified and accounted for as a capital lease
on a balance sheet of such Person under GAAP, and, for purposes of this
Agreement, the amount of such obligations shall be the capitalized amount
thereof, determined in accordance with GAAP.

 

“Capital Stock”:  any and all shares, interests, participations
or other equivalents (however designated) of capital stock of a corporation,
any and all equivalent ownership interests in a Person (other than a
corporation) and any and all warrants, rights or options to purchase any of the
foregoing.

 

“Cases”: the cases of
the Debtors before the Bankruptcy Court.

 

“Change in Law”: (a) the
adoption of any law, rule or regulation, (b) the issuance of any
administrative guidance, or (c) any change in any law, rule or
regulation or in the interpretation or application thereof by any Governmental
Authority.

 

“Closing Date”:  the date on which the conditions precedent
set forth in Section 5.1 shall have been satisfied, which date shall be no
later than May 28, 2010.

 

“Code”:  the Internal Revenue Code of 1986, as amended
from time to time.

 

“Collateral”:  all Property of the Loan Parties, now owned
or hereafter acquired, upon which a Lien is purported to be created by any
Security Document.

 

“Commitment”:  as to any Lender, the obligation of such
Lender, if any, to make a Loan to the Borrower hereunder in a principal amount
not to exceed the amount set forth under the heading “Commitment” opposite such
Lender’s name on Schedule 1 to the Lender Addendum delivered by such
Lender.  The aggregate amount of the
Commitments on the Closing Date is $250,000,000.

 

“Compliance Certificate”:  a certificate duly executed by a Responsible
Officer substantially in the form of Exhibit B.

 

“Confidential Information
Memorandum”:  the Confidential
Information Memorandum dated January, 2010, as supplemented by the Lenders
Update Materials, dated April 8, 2010 and furnished to the Lenders prior
to the Closing Date.

 

“Confirmation Order”:
as defined in Section 5.1(b).

 

“Consolidated Current
Assets”:  at any date, all amounts
(other than cash and Permitted Investments) that would, in conformity with
GAAP, be set forth opposite the caption “total current assets” (or any like
caption) on a consolidated balance sheet of the Borrower and its Subsidiaries
at such date.

 

5

 

“Consolidated Current Liabilities”:  at any date, all amounts that would, in
conformity with GAAP, be set forth opposite the caption “total current
liabilities” (or any like caption) on a consolidated balance sheet of the
Borrower and its Subsidiaries at such date, but excluding (a) the current
portion of interest, income taxes or any Funded Debt of the Borrower and its
Subsidiaries and (b), without duplication, all Indebtedness consisting of First
Lien Revolver Indebtedness, to the extent otherwise included therein.

 

“Consolidated Interest Coverage Ratio”:  as at any date, the ratio of (a) Parent
Consolidated Adjusted EBITDA for such Measurement Period to (b) Consolidated
Interest Expense for such Measurement Period.

 

“Consolidated Interest Expense”:  for any Measurement Period, total interest
expense that has been paid in cash during such period (including that
attributable to Capital Lease Obligations) of Parent and its Subsidiaries for
such period with respect to all outstanding Indebtedness of Parent and its
Subsidiaries (including all commissions, discounts and other fees and charges
owed with respect to letters of credit and bankers’ acceptance financing and
net costs under Hedging Agreements in respect of interest rates to the extent
such net costs have been or are required to be paid in cash during such
period), minus cash interest income for such Measurement Period.

 

“Consolidated Leverage Ratio”: as at
any date, the ratio of (a) Consolidated Total Debt as at such date to (b) Parent
Consolidated Adjusted EBITDA for such Measurement Period.

 

“Consolidated Net Income”:  of any Person for any period, the
consolidated net income (or loss) of such Person and its Subsidiaries for such
period, determined on a consolidated basis in accordance with GAAP; provided,
that in calculating Consolidated Net Income for any period, there shall be
excluded (a) the income (or deficit) of any Person accrued prior to the
date it becomes a Subsidiary of Parent or is merged into or consolidated with
Parent or any of its Subsidiaries, (b) the income (or deficit) of any
Person (other than a Subsidiary of Parent) in which Parent or any of its
Subsidiaries has an ownership interest accounted for under the equity method, (c) the
cumulative effect of a change in accounting principle and changes as a result
of the adoption or modification of accounting policies during such period, (d) any
effect of income (loss) from the early extinguishment of (i) Indebtedness
and (ii) obligations under any Hedging Agreement or other derivative instruments,
(e) the effects of non-cash acquisition accounting adjustments and
non-cash adjustments from the application of fresh start reporting, (f) any
net gains, losses, income or expense attributable to non-controlling interests
and (g) the undistributed earnings of any Subsidiary of Parent to the
extent that the declaration or payment of dividends or similar distributions by
such Subsidiary is not at the time permitted by the terms of any Contractual
Obligation (other than under any Loan Document) or Requirement of Law
applicable to such Subsidiary.

 

“Consolidated Total
Debt”:  as at the last day of any
fiscal quarter, the sum of (a) the aggregate outstanding principal amount
of all Indebtedness (other than First Lien Revolver Indebtedness and the
undrawn portion of any outstanding letters of credit) of Parent and its
Subsidiaries that would, in conformity with GAAP, be set forth on the 

 

6

 

balance sheet of
Parent and its Subsidiaries on such date (determined on a consolidated basis
without duplication in accordance with GAAP), plus (b) the average
of the amounts of First Lien Revolver Indebtedness outstanding on such last day
and on the last day of each of the three immediately preceding fiscal
quarters.  For purposes of computing
clause (b) above, the parties agree that the First Lien Revolver
Indebtedness as of each of September 30, 2009, December 31, 2009 and March 31,
2010 was $0.

 

“Consolidated Working Capital”:  at any date, the difference of (a) Consolidated
Current Assets on such date less (b) Consolidated Current Liabilities on
such date.

 

“Contractual Obligation”:  as to any Person, any provision of any
security issued by such Person or of any material agreement, lease, instrument
or other undertaking to which such Person is a party or by which it or any of
its Property is bound.

 

“Debtors”: as defined in the recitals
hereto.

 

“Default”:  any of the events specified in Section 8,
whether or not any requirement for the giving of notice, the lapse of time, or
both, has been satisfied.

 

“Delayed Draw Equity Commitment”: the
commitment of Pentwater Capital Management LP or its Affiliates (or any
assignee or transferee thereof or successor thereto permitted under the Delayed
Draw Equity Commitment Agreement dated as of April 15, 2010 among Parent
and certain Pentwater Capital Management LP affiliated funds party thereto, as
in effect on such date) to Parent to purchase additional shares of common stock
of Parent after the Closing Date pursuant to Section 5.2 of the Plan of
Reorganization.

 

“Dick Clark”: dick clark productions,
inc., a Delaware corporation.

 

“Discount Range”: as defined in Section 3.18(a).

 

“Disposition”:  with respect to any Property, any sale,
lease, sale and leaseback, assignment, conveyance, transfer or other
disposition thereof, but excluding any termination of the economic and voting
rights of GP Holdings Inc. pursuant to the Beneficial Share Assignment
Agreement; and the terms “Dispose” and “Disposed of” shall have correlative
meanings.

 

“Disqualified Capital Stock” shall
mean any Capital Stock of Parent that, by its terms (or by the terms of any
security or other Capital Stock into which it is convertible or for which it is
putable or exchangeable) or upon the happening of any event or condition, (a) matures
or is mandatorily redeemable (other than solely for Qualified Capital Stock of
Parent), pursuant to a sinking fund or otherwise, (b) is redeemable or
exchangeable, in whole or in part, at the option of the holder thereof (other
than solely for Qualified Capital Stock of Parent), or (c) provides for
the scheduled payment of dividends in cash, in each case prior to the date that
is one year after the Maturity Date; provided that (i) if such
Capital Stock is issued pursuant to any plan for the benefit of employees of
Parent or any of its Subsidiaries or by any such plan to such employees, such
Capital Stock shall not constitute Disqualified Capital Stock solely because it
may 

 

7

 

be required to be
repurchased by Parent or any of its Subsidiaries in order to satisfy applicable
statutory or regulatory obligations and (ii) any Capital Stock that would
not constitute Disqualified Capital Stock but for the provisions thereof giving
holders thereof the right to require Parent to purchase or redeem such Capital
Stock upon the occurrence of an “asset sale” or “change of control” prior to
the date that is one year after the Maturity Date shall not constitute
Disqualified Capital Stock so long as the terms of such Capital Stock provide
that the Loans and all other Obligations (other than obligations under “Specified
Hedging Agreements” and “Specified Cash Management Agreements” (as each such
term is defined in the First Lien Credit Agreement)) are repaid in full prior
to such purchase or redemption.

 

“Documentation Agent”:  Goldman Sachs Lending Partners LLC.

 

“Dollars” and “$”:  lawful currency of the United States of
America.

 

“Domestic Subsidiary”:  any Subsidiary of Parent organized under the
laws of any jurisdiction within the United States of America.

 

“Environmental Claim”:  with respect to any Person, any written
notice, claim, demand or other communication (collectively, a “claim”)
by any other Person alleging or asserting such Person’s liability for
investigatory costs, cleanup costs, governmental response costs, damages to
natural resources or other Property, personal injuries, fines or penalties
arising out of, based on or resulting from (a) the presence, or Release
into the environment, of any Materials of Environmental Concern at any
location, whether or not owned by such Person, or (b) circumstances
forming the basis of any violation, or alleged violation, of any Environmental
Law.  The term “Environmental Claim”
shall include, without limitation, any claim by any Governmental Authority for
enforcement, cleanup, removal, response, remedial or other actions or damages
pursuant to any applicable Environmental Law, and any claim by any third party
seeking damages, contribution, indemnification, cost recovery, compensation or
injunctive relief resulting from the presence of Materials of Environmental
Concern or arising from alleged injury or threat of injury to health, safety or
the environment, as a result of any of the foregoing.

 

“Environmental Laws”:  any and all present and future Federal,
state, local and foreign laws, rules or regulations, and any orders or
decrees, in each case as now or hereafter in effect, relating to the regulation
or protection of human health, safety or the environment or to emissions,
discharges, releases or threatened releases of pollutants, contaminants,
chemicals or toxic or hazardous substances or wastes into the indoor or outdoor
environment, including, without limitation, ambient air, soil, surface water,
ground water, wetlands, land or subsurface strata, or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of pollutants, contaminants, chemicals or toxic or
hazardous substances or wastes.

 

“Environmental Permits”:  any and all permits, licenses, approvals,
registrations, notifications, exemptions and other authorizations required
under any Environmental Law.

 

8

 

“ERISA”:  the Employee Retirement Income Security Act
of 1974, as amended from time to time.

 

“ERISA Affiliate”:  any corporation or trade or business that is
a member of any group of organizations (a) described in Section 414(b) or
(c) of the Code of which Parent is a member and (b) solely for
purposes of potential liability under Section 302(c)(11) of ERISA and Section 412(c)(11)
of the Code and the lien created under Section 302(f) of ERISA and Section 412(n) of
the Code, described in Section 414(m) or (o) of the Code of
which Parent is a member.

 

“ERISA Event”:  any of the following events or conditions:

 

(a)   any Reportable Event;

 

(b)   any failure by any Single
Employer Plan to satisfy the minimum funding standards (within the meaning of
Sections 412 or 430 of the Code or Section 302 of ERISA) applicable to
such Single Employer Plan, whether or not waived, the filing pursuant to
section 412(c) of the Code of any request for a waiver of the funding
standard with respect with respect to any Plan, or any failure to make by its
due date a required installment under Section 430(j) of the Code with
respect to any Single Employer Plan;

 

(c)   the distribution under Section 4041
of ERISA of a notice of intent to terminate any Plan or any action taken by
Parent or an ERISA Affiliate to terminate any Plan, or the incurrence by Parent
or an ERISA Affiliate of any liability under Title IV of ERISA with respect to
the termination of any Single Employer Plan;

 

(d)   the institution by the PBGC
of proceedings under Section 4042 of ERISA for the termination of, or the
appointment of a trustee to administer, any Single Employer Plan, or the
receipt by Parent or any ERISA Affiliate of a notice from a Multiemployer Plan
that such action has been taken by the PBGC with respect to such Multiemployer
Plan;

 

(e)   the complete or partial
withdrawal from a Multiemployer Plan by Parent or any ERISA Affiliate that
results in any Withdrawal Liability (including the obligation to satisfy
secondary liability as a result of a purchaser default) or the receipt by
Parent or any ERISA Affiliate of notice from a Multiemployer Plan that it is,
or is expected to be, in Reorganization, Insolvent or in “endangered” or “critical”
status, within the meaning of Section 432 of the Code or Section 305
or Title IV of ERISA or that it intends to terminate or has terminated under Section 4041-A
of ERISA;

 

(f)    the institution of a
proceeding by a fiduciary of any Multiemployer Plan against Parent or any ERISA
Affiliate to enforce Section 515 of ERISA, which proceeding is not
dismissed within 60 days;

 

(g)   the adoption of an amendment
to any Plan that, pursuant to Section 401(a)(29) of the Code or Section 307
of ERISA, would result in the loss of tax-exempt status of the trust of which
such Plan is a part if Parent or an ERISA Affiliate fails to timely provide
security to the Plan in accordance with the provisions of such Sections; or

 

9

 

(h)   a determination that any
Single Employer Plan is, or is expected to be, in “at risk” status (within the
meaning of Title IV of ERISA).

 

“Eurocurrency Loans”:  Loans for which the applicable rate of
interest is based upon the Eurocurrency Rate.

 

“Eurocurrency
Rate” : for any
Interest Rate Determination Date with respect to an Interest Period for a
Eurocurrency Loan, the rate per annum obtained by dividing (and rounding upward
to the next whole multiple of 1/100 of 1%) (i) (a) the rate per annum
(rounded to the nearest 1/100 of 1%) equal to the rate determined by the
Administrative Agent to be the offered rate which appears on the page of
the Reuters Screen which displays an average British Bankers Association
Interest Settlement Rate (such page currently being LIBOR01 page) for
deposits (for delivery on the first day of such period) with a term equivalent
to such period in Dollars, determined as of approximately 11:00 a.m.
(London, England time) on such Interest Rate Determination Date, or (b) in
the event the rate referenced in the preceding clause (a) does not appear
on such page or service or if such page or service shall cease to be
available, the rate per annum (rounded to the nearest 1/100 of 1%) equal to the
rate determined by the Administrative Agent to be the offered rate on such
other page or other service which displays an average British Bankers
Association Interest Settlement Rate for deposits (for delivery on the first
day of such period) with a term equivalent to such period in Dollars,
determined as of approximately 11:00 a.m. (London, England time) on such
Interest Rate Determination Date, or (c) in the event the rates referenced
in the preceding clauses (a) and (b) are not available, the rate per
annum (rounded to the nearest 1/100 of 1%) equal to the offered quotation rate
to first class banks in the London interbank market by Goldman Sachs Lending
Partners LLC for deposits (for delivery on the first day of the relevant
period) in Dollars of amounts in same day funds comparable to the principal
amount of the applicable Loan of the Administrative Agent, in its capacity as a
Lender, for which the Eurocurrency Rate is then being determined with
maturities comparable to such period as of approximately 11:00 a.m.
(London, England time) on such Interest Rate Determination Date, by (ii) an
amount equal to (a) one minus (b) the Eurocurrency Reserve
Requirement; provided, however, that notwithstanding the foregoing, the
Eurocurrency Rate shall at no time be less than 2.00% per annum.

 

“Eurocurrency Reserve Requirements”:
at any time, for any Eurocurrency Loan, the maximum rate, expressed as a
decimal, at which reserves (including any basic marginal, special,
supplemental, emergency or other reserves) are required to be maintained with
respect thereto against “Eurocurrency liabilities” (as such term is defined in
Regulation D) under regulations issued from time to time by the Board of
Governors or other applicable banking regulator.  Without limiting the effect of the foregoing,
the Eurocurrency Reserve Requirement shall reflect any other reserves required
to be maintained by such member banks with respect to (i) any category of
liabilities which includes deposits by reference to which the applicable
Eurocurrency Rate or any other interest rate of a Loan is to be determined, or (ii) any
category of extensions of credit or other assets which include Eurocurrency
Loans.  A Eurocurrency Loan shall be
deemed to constitute Eurocurrency liabilities and as such shall be deemed
subject to reserve requirements without benefits of credit for proration,
exceptions or 

 

10

 

offsets that may be available from time to
time to the applicable Lender.  The rate
of interest on Eurocurrency Loans shall be adjusted automatically on and as of
the effective date of any change in the Eurocurrency Reserve Requirement.

 

“Eurocurrency Tranche”:  the collective reference to Eurocurrency
Loans, the then current Interest Periods with respect to all of which begin on
the same date and end on the same later date (whether or not such Loans shall
originally have been made on the same day).

 

“Event of Default”:  any of the events specified in Section 8,
provided that any requirement for the giving of notice, the lapse of
time, or both, has been satisfied.

 

“Excess Cash Flow”:  for any fiscal year of Parent, the
difference, if any, of (a) the sum, without duplication, of (i) Borrower
Consolidated Adjusted EBITDA less the sum of (1) Consolidated
Interest Expense (provided that, for purposes of calculating Excess Cash
Flow, Consolidated Interest Expense shall be calculated for the Borrower and
its Subsidiaries) and (2) any cash expenditures made during such period on
account of any loss, expense or charge, and any cash received during such
period on account of any gain, included in the calculation of Consolidated Net
Income but excluded in the determination of Parent Consolidated Adjusted EBITDA
pursuant to clauses (a)(iv), (v) and (vi) of the definition thereof,
in each case for such fiscal year, (ii) the amount of the decrease, if
any, in Consolidated Working Capital for such fiscal year (other than any
decrease arising from acquisitions by Parent or its Subsidiaries completed
during such period or the application of acquisition accounting or fresh start
reporting adjustments) and (iii) total pension expenses for such period minus
(b) the sum, without duplication, of (i) the aggregate amount actually paid by the Borrower and its Subsidiaries in
cash during such fiscal year on account of (A) (1) Capital
Expenditures and (2) the amount of Capital Expenditures included as part
of the “capital expenditures” budget for such fiscal year in the budget
delivered pursuant to Section 6.1(g) and certified by a Responsible
Officer at or about the end of such fiscal year as being expected to be made in
cash on or prior to March 31 of the immediately following fiscal year and
made on or prior to such date (such amount under this subclause (b)(i)(A)(2) being
the “Capex Stub Amount”) (minus the principal amount of Indebtedness
(other than First Lien Revolving Credit Loans) incurred to finance such Capital
Expenditures, and excluding any such Capital Expenditures financed with the
proceeds of any Reinvestment Deferred Amount and the Capex Stub Amount deducted
in determining Excess Cash Flow for the prior fiscal year of Parent) and (B) cash
acquisitions of intellectual property, (ii) the aggregate
amount of all optional and regularly scheduled principal payments of the Loans
and other Funded Debt of the Borrower and its Subsidiaries made during such
fiscal year (other than in respect of any revolving credit facility to the
extent there is not an equivalent permanent reduction in commitments
thereunder), (iii) the aggregate amount of all prepayments or repayments
of First Lien Revolver Indebtedness during such fiscal year to the extent
accompanying permanent reductions (to the extent not replaced) of the First
Lien Revolving Credit Commitments, (iv) the amount of the increase, if
any, in Consolidated Working Capital for such fiscal year (other than any
increase arising from acquisitions by the Borrower or its Subsidiaries
completed during such period or the application of acquisition accounting), (v) the
aggregate amount of expenditures actually made by the 

 

11

 

Borrower and its
Subsidiaries in cash during such period (including expenditures for the payment
of financing, letter of credit and annual agency fees but excluding
expenditures on account of pensions) to the extent that such expenditures are
not expensed during such period (with such expenditures to be excluded in the
fiscal period when they are expensed), (vi) the amount of cash taxes paid
or tax reserves set aside or payable (without duplication) in such period, (vii) the
amount of cash payments made on account of pensions in such period, and (viii) the
aggregate amount of Restricted Payments made in cash during such fiscal year
(to the extent permitted under Section 7.6).

 

“Excess Cash Flow Application Date”:
as defined in Section 3.4(c).

 

“Excluded Foreign Subsidiaries”:  any Foreign Subsidiary in respect of which
either (a) the pledge of all of the Capital Stock of, or any Property of,
such Subsidiary as Collateral or (b) the guaranteeing by such Subsidiary
of the Obligations, would, in the good faith judgment of Parent, result in
adverse tax consequences to Parent, Holdings or the Borrower.  Any Subsidiary that Guarantees Indebtedness
under any Indenture shall not be an Excluded Foreign Subsidiary.

 

“Excluded Taxes”:  with respect to any Agent, any Lender or
Transferee (a) net income taxes and franchise taxes (imposed in lieu of
net income taxes) imposed on any Agent, Lender or Transferee as a result of a
present or former connection between such Agent, Lender or Transferee and the
jurisdiction of the Governmental Authority imposing such tax or any political
subdivision or taxing authority thereof or therein (other than any such
connection arising solely from such Agent’s, Lender’s or Transferee’s having
executed, delivered or performed its obligations or received a payment under,
or enforced, this Agreement or any other Loan Document), (b) branch
profits taxes imposed on any Agent, Lender or Transferee by the United States
of America, (c) any withholding taxes to the extent attributable to a
failure to comply with Section 3.12(e), (d) any backup withholding
tax to the extent attributable to a “Notified Payee Underreporting” as
described in Section 3406(c) or a notification by the US Internal
Revenue Service that the “Taxpayer Identification Number” furnished by such
Agent, Lender or Transferee is incorrect, (e) United States withholding
taxes that are imposed on amounts payable to such Agent, Lender or Transferee
(and in the case of a Participant, the Lender selling the participation to such
Participant), except to the extent that such withholding taxes are imposed (i) as
a result of a Change in Law after the date the Agent, Lender or Transferee
becomes a party to this Agreement,  (ii) as
a result of a change in fact after the date the Agent, Lender or Transferee
becomes a party to this Agreement that is attributable to the Borrower or other
Loan Party (or any Person related to a Borrower or Loan Party), (iii) on
such Agent’s, Lender’s or Transferee’s assignor (if any) (or, in the case of a
Participant, the Lender selling participations to such Participant) and such
Agent’s, Lender’s or Transferee’s assignor was entitled, at the time of
assignment (or the sale of the participations), to receive additional amounts
from the Borrower with respect to such withholding Taxes pursuant to Section 3.12,
or (iv) on an Agent, Lender or Transferee following an assignment,
designation of a new lending office, acquisition or the appointment of a
successor Agent pursuant to Sections 3.15 or 3.16.

 

12

 

“Existing Credit Agreement”:  the Second Amended and Restated Credit
Agreement, dated as of May 25, 2007, among Parent, Holdings, the Borrower,
JPMorgan Chase Bank, N.A., as the administrative agent, and the lenders and
other agents party thereto.

 

“Existing Parks”:  as defined in Section 4.22.

 

“Existing Time Warner Facility”:  the loan facility provided by TW to the
Acquisition Parties (and guaranteed by the Borrower, Holdings and Parent) as
evidenced by (i) that certain Promissory Note, dated as of May 15,
2009, by and among TW and the Acquisition Parties, in the original principal
amount of $52,507,000, and each other loan document entered in connection
therewith and (ii) that certain Guarantee Agreement, dated as of May 15,
2009, made by Parent, Holdings and Borrower in favor of TW.

 

“Facility”:  the Commitments and the Loans made
thereunder.

 

“Federal Funds Effective
Rate”:  for any day, the weighted
average of the rates on overnight federal funds transactions with members of
the Federal Reserve System arranged by federal funds brokers, as published on
the next succeeding Business Day by the Federal Reserve Bank of New York,
or, if such rate is not so published for any day that is a Business Day, the
average of the quotations for the day of such transactions received by JPMorgan
Chase Bank, N.A. from three federal funds brokers of recognized standing
selected by it.

 

“First Lien
Administrative Agent”:  JPMorgan
Chase Bank, N.A., in its capacity as administrative agent under and as defined
in the First Lien Credit Documents, or any successor administrative agent in
accordance with the terms thereof and any administrative agent in respect of
Permitted First Lien Refinancing Indebtedness.

 

“First Lien Auction”:  the “Auction” under and as defined in the
First Lien Credit Agreement (and
the corresponding term in any Permitted First Lien
Refinancing Indebtedness).

 

“First Lien Commitments”: the “Commitments”
under and as defined in the First Lien Credit Agreement (and the corresponding term in any Permitted First
Lien Refinancing Indebtedness).

 

“First Lien Credit Agreement”:  the First Lien Credit Agreement dated as of
the date hereof among Parent, Holdings, the Borrower, the Subsidiary
Guarantors, the lenders thereunder and the First Lien Administrative Agent, as
the same may be amended (including any amendment and restatement thereof),
supplemented or otherwise modified from time to time, and including any
agreement, instrument or other document extending the maturity of, refinancing,
replacing, renewing, refunding or otherwise restructuring all or a portion of
the Indebtedness under such agreement or any successor or replacement agreement
and whether by the same or any other agent, lender or group of lenders.

 

“First Lien Credit Documents”:  the First Lien Credit Agreement and all
agreements, instruments and documents executed and delivered pursuant to or in 

 

13

 

connection with any of the
foregoing (including indentures, notes, guarantees, security agreements,
mortgages and other collateral documents), in each case, as such agreements,
instruments or other documents may be amended, amended and restated,
supplemented, modified, refunded, renewed or extended, refinanced, replaced or
otherwise restructured as permitted under this Agreement and the Intercreditor
Agreement, in whole or in part from time to time with respect to all or any
portion of the Indebtedness under such agreement or agreements or any successor
replacement agreement or agreements and whether by the same or any other agent,
lender or group of lenders.

 

“First Lien Letters of Credit”:  the “Letters of Credit” under and as defined
in the First Lien Credit Agreement (and
the corresponding term in any Permitted First Lien
Refinancing Indebtedness).

 

“First
Lien Obligations”:  the “Obligations”
under and as defined in the First Lien Credit Agreement (and the corresponding
term in any Permitted First Lien Refinancing Indebtedness).

 

“First Lien Revolver Indebtedness”:  the “Revolver Indebtedness” under and as
defined in the First Lien Credit Agreement as of the date hereof (and the corresponding term in any Permitted First
Lien Refinancing Indebtedness).

 

“First Lien Revolving Credit Commitments”:  the “Revolving Credit Commitments” under and
as defined in the First Lien Credit Agreement (and the corresponding term in any Permitted First Lien
Refinancing Indebtedness).

 

“First Lien Revolving Credit Loans”:  the “Revolving Credit Loans” under and as
defined in the First Lien Credit Agreement (and the corresponding term in any Permitted First Lien
Refinancing Indebtedness).

 

“First Lien Swing Line Loans”:  the “Swingline Loans” under and as defined in
the First Lien Credit Agreement (and
the corresponding term in any Permitted First Lien
Refinancing Indebtedness).

 

“First Lien Tranche B Term Loans”:  the “Tranche B Term Loans” under and as
defined in the First Lien Credit Agreement (and the corresponding term in any Permitted First Lien
Refinancing Indebtedness).

 

“First
Priority Lien”:  as defined in
the Intercreditor Agreement.

 

“Fixed-to-Floating Swap”:  as defined in Section 7.16.

 

“Foreign Benefit Arrangement”: as
defined in Section 4.13(b).

 

“Foreign Plan”: as defined in Section 4.13(b).

 

“Foreign Subsidiary”:  any Subsidiary of Parent that is not a
Domestic Subsidiary.

 

14

 

“Funded Debt”:  with respect to any Person at any date of
determination, all Indebtedness of such Person of the types described in
clauses (a) through (e) of the definition of “Indebtedness” in this Section that
matures more than one year from such date of determination.

 

“Funding Office”:  the office specified from time to time by the
Administrative Agent as its funding office by notice to the Borrower and the
Lenders.

 

“GAAP”:  generally accepted accounting principles in
the United States of America as in effect from time to time.

 

“Governmental Authority”:  any nation or government, any state or other
political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, central bank or other entity exercising executive,
legislative, judicial, taxing, regulatory or administrative functions of or
pertaining to government, any securities exchange and any self-regulatory
organization (including the National Association of Insurance Commissioners)
having jurisdiction over the Business or the Property of Parent and its
Subsidiaries.

 

“Great Escape Agreements”:  collectively, (a) that certain Second
Amended and Restated Operating Agreement of HWP dated as of October 29,
2007 among HWP Management, Inc., HWP Development Holdings LLC, BBL HWP
LLC, DACWP LLC and Leisure Water LLC, as members, and the following as
guarantors or pledgors with respect to certain obligations:  Parent, Donald R. Led Duke, DACWP, LLC and
Leisure Water, LLC (as may, subject to Section 7.14, be modified, amended,
restated and/or substituted), (b) any and all agreements delivered
pursuant thereto or in connection therewith or with the development and
operation of the Property described therein, including the financing and
refinancing thereof and (c) any and all agreements, documents or
instruments entered into in connection with any expansion or development of the
Great Escape’s lodge or any hotel or timeshare arrangements located on or
adjacent to it.

 

“Guarantee”:  a guarantee, an indorsement, a contingent
agreement to purchase or to furnish funds for the payment or maintenance of, or
otherwise to be or become contingently liable under or with respect to, the
Indebtedness, other obligations, net worth, working capital or earnings of any
Person, or a guarantee of the payment of dividends or other distributions upon
the stock or equity interests of any Person, or an agreement to purchase, sell
or lease (as lessee or lessor) Property, products, materials, supplies or
services primarily for the purpose of enabling a debtor to make payment of such
debtor’s obligations or an agreement to assure a creditor against loss, and
including, without limitation, causing a bank or other financial institution to
issue a letter of credit or other similar instrument for the benefit of another
Person, but excluding endorsements for collection or deposit in the ordinary
course of business. The terms “Guarantee” and “Guaranteed” used as verbs have
the correlative meanings.

 

“Guarantee and Collateral Agreement”:  the Second Lien Guarantee and Collateral
Agreement to be executed and delivered by Parent, Holdings, the Borrower 

 

15

 

and each Subsidiary
Guarantor in favor of the Administrative Agent, substantially in the form of Exhibit A
as the same may be amended, supplemented or otherwise modified from time to
time.

 

“Guarantors”:  the collective reference to Parent, Holdings
and the Subsidiary Guarantors.

 

“Hedging Agreement”:  all interest rate or currency swaps, caps or
collar agreements, foreign exchange agreements, commodity contracts or similar
arrangements entered into by Parent or any of its Subsidiaries providing for
protection against fluctuations in interest rates, currency exchange rates,
commodity prices or the exchange of nominal interest obligations, either
generally or under specific contingencies. 
For avoidance of doubt, Hedging Agreements shall include any interest
rate swap or similar agreement that provides for the payment by Parent or any
of its Subsidiaries of amounts based upon a floating rate in exchange for
receipt by Parent or such Subsidiary of amounts based upon a fixed rate.

 

“Holdings”:  as defined in the preamble hereto.

 

“HWP”: 
HWP Development LLC, a New York limited liability company.

 

“Inactive Subsidiary”:  any Subsidiary of Parent that (a) has
aggregate assets with a value not in excess of $100,000, (b) conducts no
Business and (c) does not Guarantee any Indebtedness of Parent or any of
its Subsidiaries.

 

“Indebtedness”:  for any Person, without duplication:  (a) obligations created, issued or
incurred by such Person for borrowed money (whether by loan, the issuance and
sale of debt securities or the sale of Property to another Person subject to an
understanding or agreement, contingent or otherwise, to repurchase such
Property from such Person); (b) obligations of such Person to pay the
deferred purchase or acquisition price of Property or services, other than (i) trade
accounts payable (other than for borrowed money) arising, and accrued expenses
incurred, in the ordinary course of business so long as such trade accounts
payable are payable within 180 days (365 days in the case of payables arising
out of the purchase of inventory or Capital Expenditures determined without
regard to the exclusion contained in the definition of Capital Expenditures in
this Section 1.1) of the date the respective goods are delivered or the
respective services are rendered and (ii) any earn-out obligation until
such obligation becomes a liability on the balance sheet of such Person in accordance
with GAAP and is not paid after becoming due and payable; (c) Indebtedness
of others secured by a Lien on the Property of such Person, whether or not the
respective indebtedness so secured has been assumed by such Person; (d) obligations
of such Person in respect of letters of credit or similar instruments
(including negotiable instruments) issued or accepted by banks and other
financial institutions for account of such Person; (e) Capital Lease
Obligations of such Person; (f) the liquidation value of all redeemable
preferred Capital Stock of such Person to the extent redeemable prior to the
date which is 91 days after the Maturity Date, and (g) Indebtedness of
others Guaranteed by such Person; provided, however, that the
provision by Parent or any of its Subsidiaries of covenants, Guarantees and 

 

16

 

indemnities that are
customary for non-recourse financings (as determined by Parent in good faith)
with respect to Indebtedness incurred by a Person that is not a Subsidiary of
Parent and that is otherwise non-recourse to Parent and its Subsidiaries shall
not be deemed to be Indebtedness.  The
Indebtedness of any Person shall include the Indebtedness of any partnership in
which such Person is a general partner to the extent such Indebtedness is
recourse, provided that if such Person’s liability for such Indebtedness
is contractually limited, only such Person’s share thereof shall be so
included.  The amount of Indebtedness for
any Person for purposes of clause (c) above shall be deemed equal to the
lesser of (i) the aggregate unpaid amount of such Indebtedness, and (ii) the
fair market value of the Property encumbered thereby as determined in good
faith by such Person.  Anything herein to
the contrary notwithstanding, the following shall not constitute Indebtedness: (i) obligations
under Hedging Agreements, (ii) obligations in respect of any Indebtedness
that has been defeased (either covenant or legal) pursuant to the terms of the
instrument creating or governing such Indebtedness and (iii) obligations
under the Partnership Parks Agreements; provided, that obligations
described in the foregoing clause (iii) shall constitute Indebtedness for
purposes of Section 8(e).

 

“Indemnified Liabilities”:  as defined in Section 10.5.

 

“Indemnified Taxes”:  all Taxes (other than Excluded Taxes) and
Other Taxes.

 

“Indemnitee”:  as defined in Section 10.5.

 

“Indentures”:  collectively, any indenture or other
agreement pursuant to which Indebtedness of Parent, Holdings or the Borrower
may be outstanding at any time, in each case as amended as permitted by this
Agreement.

 

“Insolvent”:  with respect to any Multiemployer Plan, the
condition that such Plan is insolvent within the meaning of Section 4245
of ERISA.

 

“Intellectual Property”:  the collective reference to all rights,
priorities and privileges relating to intellectual property, whether arising
under United States, multinational or foreign laws or otherwise, including,
without limitation, copyrights and copyrightable works, copyright licenses,
patents, inventions, discoveries and developments, patent licenses, trademarks,
service marks, trade names, brand names, corporate names, domain names, logos,
trade dress and other source indicators and the goodwill of any business
symbolized thereby, trademark licenses, technology, know-how, processes, trade
secrets and confidential or proprietary business information, all registrations
and applications related thereto, the right to obtain renewals, extensions,
substitutions, continuations, continuations-in-part, divisions, reissues,
re-examinations or similar legal protections related thereto, and all rights to
sue at law or in equity for any infringement or other impairment thereof,
including the right to receive all proceeds and damages therefrom.

 

“Intercreditor Agreement”: the
Intercreditor Agreement, dated as of the date hereof, among the Administrative
Agent, the First Lien Administrative Agent, and 

 

17

 

acknowledged and agreed to
by Parent, Holdings, the Borrower and the Subsidiary Guarantors.

 

“Interest Payment Date”:  (a) as to any Base Rate Loan, the last
day of each March, June, September and December to occur while such
Loan is outstanding and the Maturity Date, (b) as to any Eurocurrency Loan
having an Interest Period of three months or shorter, the last day of such
Interest Period, (c) as to any Eurocurrency Loan having an Interest Period
longer than three months, each day that is three months, or a whole multiple
thereof, after the first day of such Interest Period and the last day of such
Interest Period and (d) as to any Loan, the date of any repayment or
prepayment made in respect thereof.

 

“Interest Period”:  as to any Eurocurrency Loan, (a) initially,
the period commencing on the borrowing or conversion date, as the case may be,
with respect to such Eurocurrency Loan and ending one, two, three or six months
(or, to the extent available to all applicable Lenders, nine or twelve months)
thereafter, as selected by the Borrower in its notice of borrowing or notice of
conversion, as the case may be, given with respect thereto; and (b) thereafter,
each period commencing on the last day of the next preceding Interest Period
applicable to such Eurocurrency Loan and ending one, two, three or six months
(or, to the extent available to all applicable Lenders, nine or twelve months)
thereafter, as selected by the Borrower by irrevocable notice to the
Administrative Agent not less than three Business Days prior to the last day of
the then current Interest Period with respect thereto; provided that,
all of the foregoing provisions relating to Interest Periods are subject to the
following:

 

(i)            if any Interest
Period would otherwise end on a day that is not a Business Day, such Interest
Period shall be extended to the next succeeding Business Day unless the result
of such extension would be to carry such Interest Period into another calendar
month in which event such Interest Period shall end on the immediately
preceding Business Day;

 

(ii)           any Interest Period
that would otherwise extend beyond the Maturity Date shall end on the Maturity
Date; and

 

(iii)          any Interest Period
that begins on the last Business Day of a calendar month (or on a day for which
there is no numerically corresponding day in the calendar month at the end of
such Interest Period) shall end on the last Business Day of the calendar month
at the end of such Interest Period.

 

“Interest Rate
Determination Date”:
with respect to any Interest Period, the date that is two Business Days prior
to the first day of such Interest Period.

 

“Investment”:  for any Person: (a) the acquisition
(whether for cash, Property, services or securities or otherwise) of capital
stock, bonds, notes, debentures, partnership or other ownership interests or
other securities of any other Person or any agreement to make any such
acquisition (including, without limitation, any “short sale” or any sale of any
securities at a time when such securities are not owned by the Person entering
into 

 

18

 

such sale); (b) the
making of any deposit with, or advance, loan or other extension of credit to,
any other Person (including the purchase of Property from another Person
subject to an understanding or agreement, contingent or otherwise, to resell
such Property to such Person), but excluding any such advance, loan or
extension of credit having a stated term not exceeding 360 days arising in
connection with the sale of inventory, supplies or patron services by such Person
in the ordinary course of business, and excluding also any deposit made by such
Person in the ordinary course of business of such Person or as an advance
payment in respect of a Capital Expenditure (to the extent the making of such
Capital Expenditure will not result in a violation of any of the provisions of Section 7.7);
(c) the entering into of any Guarantee of, or other contingent obligation
with respect to, Indebtedness or other liability of any other Person and
(without duplication) any amount committed to be advanced, lent or extended to
such Person, other than any Guarantee under the Partnership Parks Agreements; provided,
however, that the provision by Parent or any of its Subsidiaries of
covenants, Guarantees and indemnities that are customary for non-recourse
financings (as determined by Parent in good faith) with respect to Indebtedness
incurred by a Person that is not a Subsidiary of Parent and that is otherwise
non-recourse to Parent and its Subsidiaries shall not be deemed an Investment; or
(d) the entering into of any Hedging Agreement.  For purposes of covenant compliance, the
amount of any Investment shall be the amount actually invested, without
adjustment for subsequent increases or decreases in the value of such
Investment and shall include any and all fees, expenses, commission costs and
charges related to such Investment.

 

“Investment Grade Rating”:  a rating equal to or higher than Baa3 (or the
equivalent) by Moody’s and BBB- (or the equivalent) by S&P.

 

“IP Percentage”: (a) with respect
to Indebtedness incurred by the Borrower or any of its Subsidiaries, 100% and (b) with
respect to Indebtedness incurred by Parent or Holdings, 25% if (for purposes of
this clause (b)) on the applicable date of determination the Senior Secured
Leverage Ratio is greater than 4.5 to 1.00 and 0% otherwise.

 

“Lender Addendum”:  with respect to any Lender, a Lender
Addendum, substantially in the form of Exhibit J, to be executed
and delivered by such Lender on the Closing Date as provided in Section 10.18.

 

“Lenders”:  as defined in the preamble hereto.

 

“Lien”:  with respect to any Property, any mortgage,
lien, pledge, charge, security interest or encumbrance having the effect of
security in respect of such Property. 
For purposes of this Agreement and the other Loan Documents, a Person
shall be deemed to own subject to a Lien any Property that it has acquired or
holds subject to the interest of a vendor or lessor under any conditional sale
agreement, capital lease or other title retention agreement (other than an
operating lease) relating to such Property.

 

“Liquidity”: the sum of (a) Unrestricted
Cash and Permitted Investments held by the Loan Parties and their consolidated
Subsidiaries, (b) the Available Revolving Commitments (as defined in the
First Lien Credit Agreement as of the date hereof) on 

 

19

 

such date (with satisfaction
of the applicable conditions precedent to Revolving Extensions of Credit (as
defined in the First Lien Credit Agreement as of the date hereof) to be tested
as of such date) and (c) cash proceeds available to be received by the
Loan Parties in exchange for the issuance of shares of Parent common stock
pursuant to the Delayed Draw Equity Commitment.

 

“Liquidity Put Threshold Amount”: as
defined in the New Time Warner Facility as in effect on the Closing Date or as
the same may be modified or amended at any time from time to time, provided
such modification or amendment does not violate Section 7.14.

 

“Loan”:  as defined in Section 2.1.

 

“Loan Documents”:  this Agreement, the Security Documents and
the Notes.

 

“Loan Parties”:  Parent, Holdings, the Borrower and each
Subsidiary of the Borrower that is a party to a Loan Document.

 

“Margin Stock”:  “margin stock” within the meaning of Regulations
T, U and X of the Board.

 

“Material Adverse Effect”:  a material adverse effect on (a) the
Loans, (b) the Business, Property or financial condition of Parent and its
Subsidiaries taken as a whole or (c) the validity or enforceability of
this Agreement or any of the other Loan Documents or the rights or remedies of
the Administrative Agent or the Lenders hereunder or thereunder.

 

“Materials of Environmental Concern”:  any gasoline or petroleum (including crude
oil or any fraction thereof) or petroleum products or any hazardous or toxic
substances, materials or wastes, defined or regulated as such in or under any
Environmental Law, including asbestos, polychlorinated biphenyls and
urea-formaldehyde insulation.

 

“Maturity Date”:  December 31, 2016.

 

“Measurement Period”:  for any determination under this Agreement,
the four consecutive fiscal quarters of Parent or Borrower, as applicable, then
last ended for which financial statements are required to be delivered pursuant
to Section 6.1(a) or (d).

 

“Moody’s”:  Moody’s Investors Service, Inc. and any
successor thereto.

 

“Mortgaged Properties”:  the Real Properties listed on Schedule
1.1(a), as to which the Administrative Agent for the benefit of the Lenders has
been granted a Lien pursuant to the Mortgages.

 

“Mortgages”:  each of the mortgages and deeds of trust
encumbering the Mortgaged Properties made by the Loan Party party thereto in
favor of, or for the benefit of, the Administrative Agent for the benefit of
the Lenders, as delivered on the Closing 

 

20

 

Date in form and substance
reasonably satisfactory to the Administrative Agent, together with any other
mortgages and deeds of trust made by any Loan Party in accordance with Section 6.6(b) in
favor of, or for the benefit of, the Administrative Agent for the benefit of
the Lenders, substantially in the form of the mortgages and deeds of trust
delivered on the Closing Date (with such changes thereto as shall be reasonably
advisable under the law of the jurisdiction in which such mortgage or deed of
trust is to be recorded), in each case as the same may be amended,
supplemented, substituted or otherwise modified from time to time.

 

“Multiemployer Plan”:  a Plan that is a multiemployer plan as
defined in Section 4001(a)(3) of ERISA.

 

“Net Cash Proceeds”:  (a)  in connection with any Asset Sale
or any Recovery Event, the proceeds thereof received by Parent or any
Subsidiary in the form of cash and Permitted Investments (including any such
proceeds received in such form by way of deferred payment of principal pursuant
to a note or installment receivable or purchase price adjustment receivable or
otherwise, but only as and when received) of such Asset Sale or Recovery Event,
net of attorneys’ fees, accountants’ fees, investment banking fees, amounts
required to be applied to the repayment of Indebtedness and other obligations
secured by a Lien expressly permitted hereunder on, or amount required to be
paid under Capital Lease Obligations relating to, any asset which is the
subject of such Asset Sale or Recovery Event (other than any Lien pursuant to a
Security Document) and other customary fees and expenses actually incurred in
connection therewith and net of (i) taxes paid or reasonably estimated to
be payable as a result thereof (after taking into account any available tax
credits or deductions and any tax sharing arrangements applicable to the
transactions) and (ii) any reserve for adjustment in respect of (A) the
sale price of such asset or assets established in accordance with GAAP and (B) any
liabilities associated with such asset or assets retained by Parent or any of
its Subsidiaries after such sale or other disposition thereof and (b) in
connection with any issuance or sale of debt securities or instruments or the
incurrence of loans or other Indebtedness, the cash proceeds received from such
issuance or incurrence, net of attorneys’ fees, investment banking fees,
accountants’ fees, underwriting discounts and commissions and other customary
fees and expenses actually incurred in connection therewith.

 

“New Time Warner Facility”: the loan
facility provided by TW to the Acquisition Parties (and guaranteed by Parent,
Holdings, the Borrower and each other of Parent’s Subsidiaries that are or
become Subsidiary Guarantors pursuant to, or otherwise guarantee obligations
under, this Agreement and the other Loan Documents), evidenced by (i) that
certain Loan Agreement, dated as of the date hereof, by and among TW and the
Acquisition Parties, in the original principal amount of $150,000,000, and each
other loan document entered in connection therewith, and (ii) that certain
Guarantee Agreement, dated as of the date hereof, made by the Guarantors in
favor of TW, in each case, as the same may be refinanced, refunded, replaced or
renewed in accordance with Section 7.3(c) and as may be amended,
restated, supplemented or otherwise modified from time to time, provided such
amendment, restatement, supplement or other modification does not violate Section 7.14.

 

21

 

“Non-Consenting Lender”:  in the event that (i) the Borrower or
the Administrative Agent has requested the Lenders to consent to a departure or
waiver of any provisions of the Loan Documents or to agree to any amendment
thereto, (ii) the consent, waiver or amendment in question requires the
agreement of all Lenders or all affected Lenders in accordance with the terms
of Section 10.1 or all the Lenders with respect to a certain class of
Loans or Commitments and (iii) the Required Lenders have agreed to such
consent, waiver or amendment, then any Lender who does not agree to such
consent, waiver or amendment shall be deemed a “Non-Consenting Lender”.

 

“Non-Guarantor Subsidiary”:  any Subsidiary of the Borrower that is not a
Subsidiary Guarantor.

 

“Non-U.S. Lender”:  as defined in Section 3.12(e).

 

“Note”:  any promissory note evidencing any Loan.

 

“Obligations”:  the unpaid principal of and interest on
(including, without limitation, interest accruing after the maturity of the
Loans and interest accruing after the filing of any petition in bankruptcy, or
the commencement of any insolvency, reorganization or like proceeding, relating
to the Borrower, whether or not a claim for post-filing or post-petition
interest is allowed in such proceeding) the Loans and all other obligations and
liabilities of the Borrower to the Administrative Agent or to any Lender,
whether direct or indirect, absolute or contingent, due or to become due, or
now existing or hereafter incurred, which may arise under, out of, or in
connection with, this Agreement, any other Loan Document or any other document
made, delivered or given by any Loan Party in connection herewith or therewith,
whether on account of principal, interest, reimbursement obligations, fees, indemnities,
costs, expenses (including, without limitation, all fees, charges and
disbursements of counsel to the Administrative Agent or to any Lender that are
required to be paid by the Borrower pursuant hereto) or otherwise.

 

“Operated Properties”:  as defined in Section 4.17(a).

 

“Other Taxes”:  any and all present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies arising from any payment made hereunder or from the execution, delivery
or enforcement of, or otherwise with respect to, this Agreement or any other
Loan Document.

 

“Parent”:  as defined in the preamble hereto.

 

“Parent Backstop Group”:  as defined in Section 5.1(t).

 

“Parent Consolidated Adjusted EBITDA”:  for any period, the sum, for Parent and its
Subsidiaries (determined on a consolidated basis without duplication in
accordance with GAAP), of the following:

 

(a)           Consolidated
Net Income of Parent and its Subsidiaries for such period excluding those
amounts which, in the determination of Consolidated Net Income for such period,
have been added or deducted for (i) total interest expense and, to the
extent 

 

22

 

not reflected in such total
interest expense, any losses on hedging or other derivative instruments, net of
interest income and gains on such hedging obligations, (ii) provisions for
federal, state, local and foreign income tax, franchise taxes and similar taxes
imposed in lieu of income tax, (iii) depreciation and amortization expense
(including, without limitation, amortization of goodwill and other intangible
assets) and any impairment of property, equipment, goodwill or other intangible
assets, (iv) any effect of extraordinary, non-recurring or unusual gains
or losses or expenses and curtailments or modifications to pension and
post-retirement employee benefit plans, provided that the amount of cash
expenditures added back as a result of this clause (iv) shall not exceed
$15,000,000 in any twelve-month period, (v) any net gains or losses of
disposed, abandoned or discontinued assets or operations except for income and
expenses prior to disposition, (vi) any fees, expenses, commissions, costs
or other charges related to (A) any securities offering, Investment,
acquisition, disposition or other similar transaction permitted hereunder or
the incurrence of Indebtedness permitted to be incurred hereunder (including
any extension, renewal, refinancing or replacement thereof), in each case
whether or not successful and whether or not consummated prior to, on, or after
the Closing Date, (B) the Cases, the Plan of Reorganization and the
transactions contemplated by the Cases and the Plan of Reorganization, and (C) emergence
compensation, the termination or settlement of leases and executory contracts,
litigation costs and settlements, asset write-ups or write-downs, income and
gains recorded in connection with the corporate reorganization effected in
connection with the administration of the Debtors’ Cases, (vii)(A) any net
unrealized gain or loss (after any offset) resulting in such period from
obligations under any hedging obligations or other derivative instruments and
the application of Statement of Financial Accounting Standards No. 133 and
(B) any net unrealized gain or loss (after any offset) resulting in such
period from currency translation, in each case to the extent not incurred in
cash and (viii) the Consolidated Net Income of any Person (adjusted for
items (i) through (vii) of this paragraph (a)) to the extent (A) attributable
to interests held by third parties in Subsidiaries of Parent that are not
wholly-owned by Parent or (B) attributable to interests in Persons
accounted for under the equity method except to the extent of the cash received
by Parent or any of its Subsidiaries from such Person, net of the Investments
therein, in respect of such period, plus

 

(b)           any
non-cash or stock-based compensation costs or expenses incurred by Parent or
any of its Subsidiaries pursuant to any management equity plan or stock option
plan or any other management or employee benefit plan or agreement or any stock
subscription or shareholder agreement, less any cash costs of such plans
or agreements incurred during such period.

 

Calculations of Parent Consolidated Adjusted
EBITDA shall be as set forth on Exhibit B attached hereto.

 

Notwithstanding the foregoing if, during any
period for which Parent Consolidated Adjusted EBITDA is being determined,
Parent or any of its Subsidiaries shall have consummated any Acquisition or
Disposition then, for all purposes of this Agreement, Parent Consolidated
Adjusted EBITDA shall be determined on a pro forma basis as if such Acquisition
or Disposition had been made or consummated on the first day of such 

 

23

 

period. 
The parties hereby agree that Parent Consolidated Adjusted EBITDA for
the fiscal quarter ending (a) June 30, 2009 was $53,241,000, (b) September 30,
2009 was $205,755,000 and (c) December 31, 2009 was ($16,926,000).

 

“Park”:  collectively, the Existing Parks and any
other amusement or attraction park acquired by any of Parent and its
Subsidiaries after the date hereof.

 

“Participant”:  as defined in Section 10.6(c).

 

“Participant Register”: as defined in Section 10.6(b)(iv).

 

“Partnership Parks Agreements”:  (a) the Overall Agreement, dated as of February 15,
1997, among Six Flags Fund, Ltd. (L.P.), Salkin Family Trust, SFG, Inc.,
SFG-I, LLC, SFG-II, LLC, Six Flags Over Georgia, Ltd., SFOG II, Inc., SFOG
II Employee, Inc., SFOG Acquisition A, Inc., SFOG Acquisition B,
L.L.C., Six Flags Over Georgia, Inc., Six Flags Services of Georgia, Inc.,
the Borrower and Six Flags Entertainment Corporation and the Related Agreements
(as defined therein), (b) the Overall Agreement dated as of November 24,
1997 among Six Flags Over Texas Fund, Ltd., Flags’ Directors, L.L.C., FD-II,
L.L.C., Texas Flags, Ltd., SFOT Employee, Inc., SFOT Acquisition I, Inc.,
SFOT Acquisition II, Inc., Six Flags Over Texas, Inc., the Borrower
and Six Flags Entertainment Corporation, as amended by the Agreement dated as
of December 6, 1999 between and among the foregoing parties and Six Flags
Fund II, Ltd., and the Related Agreements (as defined therein), and (c) the
Subordinated Indemnity Agreement, and each related agreement entered into in
connection therewith (including, without limitation, the Beneficial Share
Assignment Agreement, the Subordinated Indemnity Escrow Agreement, dated as of September 28,
2006, by and among Parent, Warner Bros. Entertainment Inc. (as successor to
Time Warner Entertainment Company, L.P.), Historic TW Inc. (formerly known as
Time Warner Inc.) and the Bank of New York, as the same has been amended,
supplemented, waived or otherwise modified on or prior to the Closing Date, and
the Acquisition Company Liquidity Agreement dated as of December 8, 2006
by and among Parent, Holdings, Borrower, GP Holdings, Inc., SFOG II, Inc.,
SFT Holdings, Inc., Time Warner Inc., TW-SPV Co., Warner Bros.
Entertainment Inc. (as successor to Time Warner Entertainment Company, L.P.),
the Acquisition Parties, SFOG Acquisition A Holdings, Inc., SFOG
Acquisition B Holdings, Inc., SFOT Acquisition I Holdings, Inc. and
SFOT Acquisition II Holdings, Inc.), in each case, as the same may be
modified or amended at any time from time to time, provided such modification
or amendment does not violate Section 7.14.

 

“Partnership Parks Entities”: (i) Six
Flags Over Georgia II, L.P., a Delaware limited partnership, Texas Flags, Ltd.,
a Texas limited partnership, GP Holdings Inc., a Delaware corporation, SFOT
Acquisition I Holdings, Inc., a Delaware corporation, SFOT Acquisition II
Holdings, Inc., a Delaware corporation, SFOG Acquisition A Holdings, Inc.,
a Delaware corporation, SFOG Acquisition B Holdings, Inc., a Delaware
corporation, Six Flags Over Georgia, Inc., a Delaware corporation, and the
Acquisition Parties and (ii) any of their respective Subsidiaries.

 

24

 

“Payment Office”:  the office specified from time to time by the
Administrative Agent as its payment office by notice to the Borrower and the
Lenders.

 

“PBGC”:  the Pension Benefit Guaranty Corporation
established pursuant to Subtitle A of Title IV of ERISA (or any successor).

 

“Permitted Acquisition”: as defined in
Section 7.5(e)(i).

 

“Permitted First Lien Refinancing
Indebtedness”:  as defined in Section 7.3(i).

 

“Permitted Holders”:  Any fund affiliated with Stark
Investments, CQS, Tricadia Capital Management, LLC, 1798 Global Partners,
Capital Ventures International, Altai Capital Management, H Partners Management
LLC, Bay Harbour Management, Pentwater Capital Management LP, Fortelus Capital
Management LLP, Credit Suisse Securities (USA) LLC and Candlewood
Special Situations Master Fund Ltd.

 

“Permitted Investments”:  (a) Dollars; (b)(i) Pounds Sterling
or Euros or (ii) in the case of any Foreign Subsidiary, such local
currencies held by it from time to time in the ordinary course of business; (c) securities
issued or directly and fully and unconditionally guaranteed or insured by the
United States government or any agency or instrumentality thereof the
securities of which are unconditionally guaranteed as a full faith and credit
obligation of such government with maturities of 24 months or less from the
date of acquisition; (d) certificates of deposit, time deposits and
eurodollar time deposits with maturities of one year or less from the date of
acquisition, bankers’ acceptances with maturities not exceeding one year and
overnight bank deposits, in each case with any domestic or foreign commercial
bank having capital and surplus of not less than $500,000,000 in the case of
U.S. banks and $100,000,000 (or the Dollar equivalent as of the date of
determination) in the case of non-U.S. banks; (e) repurchase obligations
for underlying securities of the types described in clauses (c), (d) and (h) entered
into with any financial institution meeting the qualifications specified in
clause (d) above; (f) commercial paper rated at least P-1 by Moody’s
or at least A-1 by S&P and in each case maturing within 24 months after the
date of creation thereof and Indebtedness or preferred stock issued by Persons
with a rating of “A” or higher from S&P or “A2” or higher from Moody’s with
maturities of 24 months or less from the date of acquisition; (g) marketable
short-term money market and similar securities having a rating of at least P-2
or A-2 from either Moody’s or S&P, respectively (or, if at any time neither
Moody’s nor S&P shall be rating such obligations, an equivalent rating from
another nationally recognized statistical rating agency selected by the
Borrower) and in each case maturing within 24 months after the date of creation
or acquisition thereof; (h) readily marketable direct obligations issued
by any state, commonwealth or territory of the United States or any political
subdivision or taxing authority thereof having an Investment Grade Rating from
either Moody’s or S&P with maturities of 24 months or less from the date of
acquisition; (i) readily marketable direct obligations issued by any
foreign government or any political subdivision or public instrumentality
thereof, in each case having an Investment Grade Rating from either Moody’s or
S&P with maturities of 24 months or less from the date of acquisition; (j) Investments
with average maturities of 12 months or less from the date of acquisition in
money market funds; (k) investment funds investing 

 

25

 

90% of their assets in
securities of the types described in clauses (a) through (j) above;
and (l) in the case of Foreign Subsidiaries, substantially similar
investments to those set forth in clauses (a) through (k) above
denominated in foreign currencies, provided that references to the
United States of America (or any agency or instrumentality thereof) shall be
deemed to mean foreign countries having a sovereign rating of “A” or better
from either S&P or Moody’s (or another nationally recognized statistical
rating agency selected by the Borrower and reasonably acceptable to the
Administrative Agent).

 

“Permitted Liens”:  as defined in Section 7.4.

 

“Person”:  an individual, partnership, corporation,
limited liability company, business trust, joint stock company, trust,
unincorporated association, joint venture, Governmental Authority or other
entity of whatever nature.

 

“Plan”:  an employee benefit plan (within the meaning
of Section 3(3) of ERISA) and in respect of which Parent or any ERISA
Affiliate is (or if such Plan were terminated, would under Section 4062 or
Section 4069 of ERISA be deemed to be) an employer as defined in Section 305
of ERISA.

 

“Plan of Reorganization”: as defined
in the recitals hereto.

 

“Platform”: as defined in Section 5.1(f).

 

“Prepayment Amount”: as defined in Section 3.10(d).

 

“Prepayment Date”: as defined in Section 3.10(d).

 

“Prepayment Option Notice”: as defined
in Section 3.10(d).

 

“Prime Rate”:  the rate of interest per annum publicly
announced from time to time by JPMorgan Chase Bank, N.A. as its prime rate in
effect at its principal office in New York City (the Prime Rate not being
intended to be the lowest rate of interest charged JPMorgan Chase Bank, N.A. in
connection with extensions of credit to borrowers).

 

“Pro Forma Balance Sheet”: 
as defined in Section 4.1.

 

“Property”:  any right or interest in or to property of
any kind whatsoever, whether Real Property, personal or mixed and whether
tangible or intangible, including, without limitation, Capital Stock.

 

“Purchase Money Indebtedness”:  (a) Indebtedness consisting of the
deferred purchase price of Property, conditional sale or other obligations
under any title retention agreement, installment sales and other purchase money
obligations, in each case where the maturity of such Indebtedness does not
exceed the anticipated useful life of the Property being financed, and (b) Indebtedness
incurred to finance the acquisition of Property (including Acquisitions),
including additions and improvements; provided, however, that any
Lien arising in connection with any such Indebtedness shall be limited 

 

26

 

to the specified asset being
financed (or replacement items) or, in the case of Real Property, the Real
Property on which such asset is attached; and provided  further,
that such Indebtedness is incurred within 180 days after such acquisition,
addition or improvement by the Borrower or a Subsidiary of such asset.

 

“Purchase Price”:  with respect to any Acquisition, the sum
(without duplication) of (a) the amount of cash paid by Parent and its
Subsidiaries in connection with such Acquisition, (b) the value (as
determined for purposes of such Acquisition in accordance with the applicable
acquisition agreement) of all Capital Stock of Parent or any of its
Subsidiaries issued or given as consideration in connection with such
Acquisition (other than Qualified Net Cash Equity Proceeds applied to finance
such Acquisition within 180 days of such Acquisition or Capital Stock of Parent
that is issued in connection with and as consideration for an Acquisition), (c) the
principal amount (or, if less, the accreted value) at the time of such
Acquisition of all Indebtedness incurred, assumed or acquired by Parent and its
Subsidiaries in connection with such Acquisition, (d) all additional
purchase price amounts in connection with such Acquisition in the form of
earnouts, deferred purchase price and other contingent obligations that are
required to be recorded as a liability on the balance sheet of Parent and its
Subsidiaries in accordance with GAAP, Regulation S-X under the Securities Act
of 1933, as amended, or any other rule or regulation of the SEC, (e) all
amounts paid by Parent and its Subsidiaries in respect of covenants not to
compete, consulting agreements and other affiliated contracts in connection
with such Acquisition, and (f) the aggregate fair market value of all
other consideration given by Parent and its Subsidiaries in connection with
such Acquisition.

 

“Qualified Capital Stock” shall mean
any Capital Stock that is not Disqualified Capital Stock.

 

“Qualified Net Cash Equity Proceeds”:  the Net Cash Proceeds of any offering of
Capital Stock of Parent so long as (a) such offering was made in express
contemplation of an Acquisition or an Investment, as the case may be, (b) such
Capital Stock is not mandatorily redeemable prior to the date that is one year
after the Maturity Date and (c) such Acquisition or Investment, as the
case may be, is consummated within 180 days after receipt by Parent of such Net
Cash Proceeds.

 

“Qualifying Bids” as defined in Section 3.18(c).

 

“Qualifying Lender” as defined in Section 3.18(d).

 

“Real Properties”:  all real property, including the improvements
thereon, owned by, or leased by, Parent, Holdings, the Borrower or its
Subsidiaries.

 

“Recovery Event”:  any settlement of or payment in excess of
$2,500,000 in respect of any Property or casualty insurance claim or any
condemnation proceeding relating to any Property of Borrower or any of its
Subsidiaries.

 

“Refinancing Expenses”:  with respect to any refinancing, refunding,
replacement or renewal of any Indebtedness, accrued and unpaid interest (or
dividends) and premium 

 

27

 

thereon plus other
reasonable amounts paid and fees and expenses incurred in connection therewith.

 

“Register”:  as defined in Section 10.6(b)(iv).

 

“Regulation H”:  Regulation H of the Board as in effect from
time to time.

 

“Regulation U”:  Regulation U of the Board as in effect from
time to time.

 

“Reinvestment Deferred Amount”:  with respect to any Reinvestment Event, the
aggregate Net Cash Proceeds received by the Borrower or any of its Subsidiaries
in connection therewith that, as a result of the delivery of a Reinvestment
Notice, are not applied to repay the Loans pursuant to Section 5.5(b).

 

“Reinvestment Event”:  any Asset Sale or Recovery Event in respect
of which the Borrower has delivered a Reinvestment Notice.

 

“Reinvestment Notice”:  a written notice executed by a Responsible
Officer of Holdings or the Borrower stating that no Default or Event of Default
has occurred and is continuing and that the Borrower (directly or indirectly
through a Subsidiary) intends and expects to use all or a specified portion of
the Net Cash Proceeds of an Asset Sale or Recovery Event to acquire, restore or
reconstruct assets useful in its business (including for Permitted
Acquisitions).

 

“Reinvestment Prepayment Amount”:  with respect to any Reinvestment Event, the
Reinvestment Deferred Amount relating thereto less any amount expended prior to
the relevant Reinvestment Prepayment Date to acquire, restore, or reconstruct
assets useful in business of the Borrower and its Subsidiaries (including for
Permitted Acquisitions).

 

“Reinvestment Prepayment Date”:  with respect to any Reinvestment Event, the
earlier of (a) the date occurring one year after such Reinvestment Event
and (b) the date on which the Borrower shall have determined not to, or
shall have otherwise ceased to, acquire, restore or reconstruct assets useful
in the business of Parent and its Subsidiaries (including for Permitted
Acquisitions) with all or any portion of the relevant Reinvestment Deferred
Amount.

 

“Related Transactions”: the execution,
delivery and performance of the New Time Warner Facility by the parties
thereto, the repayment in full of the Existing Time Warner Facility, the
amendment to, or amendment and restatement of, supplement or other modification
to certain Partnership Parks Agreement or other Contractual Obligations of the
Partnership Parks Entities in connection with the Plan of Reorganization and
any other transactions consummated in connection with the Plan of
Reorganization, including the contemplated rights offering to purchase common
stock of Parent.

 

“Release”:  any release, threatened release, spill,
emission, leaking, pumping, injection, deposit, disposal, discharge, dispersal,
leaching or migration into the indoor or 

 

28

 

outdoor environment,
including, without limitation, the movement of Materials of Environmental
Concern through ambient air, soil, surface water, ground water, wetlands, land
or subsurface strata that violates or creates any liability under any
Environmental Law.

 

“Reorganization”:  with respect to any Multiemployer Plan, the
condition that such plan is in reorganization within the meaning of Section 4241
of ERISA.

 

“Reply Amount”: as defined in Section 3.18(b).

 

“Reply Discount”: as defined in Section 3.18(b).

 

“Reportable Event”:  any of the events set forth in Section 4043(c) of
ERISA and the regulations issued thereunder, with respect to a Single Employer
Plan, as to which the PBGC has not by regulation waived the requirement of Section 4043(a) of
ERISA that it be notified within 30 days of the occurrence of such event (provided
that a failure of any Single Employer Plan to meet the minimum funding
standards of Section 412 or 430 of the Code or Section 302 of ERISA,
including, without limitation, the failure to make on or before its due date a
required installment under Section 430(j) of the Code, shall be a
reportable event).

 

“Required Lenders”:  at any time, the holders of more than (i) 50%
of the Commitments or (ii) following the making of the Loans hereunder,
50% of the sum of the aggregate unpaid principal amount of the Loans then
outstanding.

 

“Requirement of Law”:  as to any Person, the Certificate of
Incorporation and By-Laws or other organizational or governing documents of
such Person, and any law, treaty, rule or regulation or determination of
an arbitrator or a court or other Governmental Authority, in each case
applicable to or binding upon such Person or any of its Property or to which
such Person or any of its Property is subject.

 

“Responsible Officer”:  as to any Person, the chief executive officer,
president, chief financial officer, senior vice president or treasurer of such
Person, but in any event, with respect to financial matters, the chief
financial officer, senior vice president-finance or treasurer of such Person.

 

“Restricted Payment”:  dividends (in cash, Property or obligations)
on, or other payments or distributions on account of, or the setting apart of
money for a sinking or other analogous fund for, or the purchase, redemption,
retirement or other acquisition of, any shares of any Capital Stock of Parent,
Holdings or the Borrower or of any warrants, options or other rights to acquire
the same (or to make any payments to any Person (except “earn-out” payments or
similar payments in connection with an Acquisition or pursuant to any agreement
entered into in connection therewith, in each case where such obligation does
not constitute Indebtedness) such as “phantom stock” payments, where the amount
thereof is calculated with reference to the fair market or equity value of
Parent, Holdings or the Borrower), but excluding dividends payable solely in
shares of common stock of Parent, Holdings or the Borrower.

 

29

 

“Return Bid”: as defined in Section 3.18(b).

 

“RP Eligible Proceeds”: Net Cash Proceeds
from Dispositions permitted under Sections 7.5(c)(ii), 7.5(c)(vi), 7.5(c)(vii),
7.5(c)(viii) and 7.5(c)(xiii).

 

“S&P”:  Standard & Poor’s Ratings Services,
a subsidiary of The McGraw-Hill Companies, Inc., and any successor
thereto.

 

“SEC”: 
the Securities and Exchange Commission (or successors thereto or an
analogous federal Governmental Authority).

 

“Security Documents”:  the collective reference to the Guarantee and
Collateral Agreement (and all assumptions thereof), the Mortgages and all other
security documents which shall have been delivered on or prior to the Closing
Date, or are hereafter delivered to the Administrative Agent granting a Lien on
any Property of any Person to secure the obligations and liabilities of any
Loan Party under any Loan Document, as the same have been, and on and after the
Closing Date shall be modified, amended, amended and restated, restated or
supplemented in accordance herewith.

 

“Senior Secured Debt”:  as at the last day of any Measurement Period,
the sum of (a) the aggregate outstanding principal amount of all
Indebtedness (other than First Lien Revolver Indebtedness and the undrawn
portion of any outstanding letters of credit) of the Borrower and its
Subsidiaries hereunder and under the First Lien Credit Agreement or that
otherwise is secured by property or assets of the Borrower and its Subsidiaries
and that would, in conformity with GAAP, be set forth on the balance sheet of
the Borrower and its Subsidiaries on such date (determined on a consolidated
basis without duplication in accordance with GAAP), plus (b) the
average of the amount of First Lien Revolver Indebtedness outstanding on such
last day and on the last day of each of the three immediately preceding fiscal
quarters.  For purposes of computing
clause (b) above, the parties agree that the First Lien Revolver
Indebtedness as of each of September 30, 2009, December 31, 2009 and March 31,
2010 was $0.

 

“Senior Secured Leverage Ratio”:  as at any date, the ratio of (a) Senior
Secured Debt as at such date to (b) Borrower Consolidated Adjusted EBITDA
for the Measurement Period most recently ended prior to such date.

 

“SFO Notes”:  as defined in Section 5.1(t).

 

“Shared Services Agreement”:  the Amended and Restated Shared Services
Agreement, dated as of January 1, 2006, among Parent, Holdings, the
Borrower and PP Data Services Inc., a Subsidiary of Holdings, as the same may
be amended in a manner not materially adverse to the interests of the Lenders.

 

“Single Employer Plan”:  any Plan that is covered by Title IV of
ERISA, but which is not a Multiemployer Plan.

 

“Solvent”:  with respect to any Person, as of any date of
determination, (a) the amount of the “present fair saleable value” of the
assets of such Person will, as of such 

 

30

 

date, exceed the amount of
all “liabilities of such Person, contingent or otherwise”, as of such date, as
such quoted terms are determined in accordance with applicable federal and
state laws governing determinations of the insolvency of debtors, (b) the
present fair saleable value of the assets of such Person will, as of such date,
be greater than the amount that will be required to pay the liability of such
Person on its debts as such debts become absolute and matured, (c) such
Person will not have, as of such date, an unreasonably small amount of capital
with which to conduct its business, and (d) such Person will be able to
pay its debts as they mature.  For
purposes of this definition, (i) “debt” means liability on a “claim”, (ii) “claim”
means any (x) right to payment, whether or not such a right is reduced to
judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured,
disputed, undisputed, legal, equitable, secured or unsecured or (y) right
to an equitable remedy for breach of performance if such breach gives rise to a
right to payment, whether or not such right to an equitable remedy is reduced
to judgment, fixed, contingent, matured or unmatured, disputed, undisputed,
secured or unsecured and (iii) assets shall include insurance coverage
and/or indemnification available with respect to any liability.

 

“Subordinated Indemnity Agreement”:  the Subordinated Indemnity Agreement, dated
as of April 1, 1998, among Parent, GP Holdings Inc., Time Warner Inc.,
Warner Bros. Entertainment Inc. (as successor to Time Warner Entertainment
Company, L.P.), TW-SPV Co., Holdings, the Borrower, SFOG II, Inc. and SFT
Holdings, Inc., as the same may be modified or amended at any time from
time to time, provided such modification or amendment does not violate Section 7.14.

 

“Subsidiary”:  as to any Person, a corporation, partnership,
limited liability company or other entity of which shares of stock or other
ownership interests having ordinary voting power (other than stock or such
other ownership 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 corporation, partnership, limited liability company or other entity are
at the time owned, or the management of which is otherwise controlled, directly
or indirectly through one or more intermediaries, or both, by such Person; provided
that, notwithstanding the foregoing, each of the Partnership Parks Entities
will be deemed to be a Subsidiary of Parent for all purposes under this
Agreement, provided  further that none of the joint ventures
established pursuant to the Great Escape Agreements, any Inactive Subsidiary,
Six Flags Over Texas Fund, Ltd. or Six Flags Fund, Ltd. will be deemed to be a
Subsidiary of Parent for any purpose under this Agreement.  Unless otherwise qualified, all references to
a “Subsidiary” or to “Subsidiaries” in this Agreement shall refer to a
Subsidiary or Subsidiaries of Parent.

 

“Subsidiary Guarantor”:  each Subsidiary of the Borrower other than (a) any
Excluded Foreign Subsidiary, (b) Flags Beverages, Inc., Fiesta Texas
Hospitality LLC and any other Subsidiary whose only material asset is a liquor
license, (c) HWP, (d) HWP Development Holdings LLC, (e) SFRCC
Corp., (f) any Inactive Subsidiary and (g) after the Closing Date,
any non-Wholly Owned Subsidiary that does not execute the Guarantee and
Collateral Agreement as permitted by Section 6.6.

 

“Syndication Agent”:  Goldman Sachs Lending Partners LLC.

 

31

 

“Tax Sharing Agreement”:  that certain Tax Sharing Agreement, effective
as of January 1, 1999 and as amended on or prior to the Closing Date,
among Parent, Holdings, and those Subsidiaries which are parties thereto, as
the same may be modified or amended at any time from time to time, provided
such modification or amendment does not violate Section 7.14.

 

“Taxes”:  any present or future income, stamp or other
taxes, levies, imposts, duties, charges, fees, deductions or withholdings, now
or hereafter imposed, levied, collected, withheld or assessed by any
Governmental Authority.

 

“Time Warner”:  Historic TW Inc. and/or its affiliates.

 

“Transactions”:  (a) the execution, delivery and
performance by each Loan Party of the Loan Documents to which it is or is to be
a party, the borrowing of Loans, and the use of the proceeds thereof, (b) the
execution, delivery and performance by each Loan Party of the First Lien Loan
Documents to which it is or is to be a party, the borrowings under the First
Lien Loan Documents, the use of the proceeds thereof and the issuance of
letters of credit thereunder, and (c) the transactions consummated in
connection with the Plan of Reorganization.

 

“Transferee”:  as defined in Section 10.15.

 

“TW”: 
TW-SF LLC, a Delaware limited liability company or its permitted
successors and assigns.

 

“Type”:  as to any Loan, its nature as a Base Rate
Loan or a Eurocurrency Loan.

 

“Uniform Commercial Code”:  the Uniform Commercial Code as the same may,
from time to time, be in effect in the State of New York; provided, however,
that in the event that, by reason of mandatory provisions of law, any or all of
the perfection or priority of the security interest in any Collateral is
governed by the Uniform Commercial Code as in effect in a jurisdiction other
than the State of New York, the term “Uniform Commercial Code” shall mean the
Uniform Commercial Code as in effect in such other jurisdiction for purposes of
the provisions hereof relating to such perfection or priority (but not attachment)
and for purposes of definitions related to such provisions.

 

“Unrestricted Cash”:  all cash that is not restricted cash, as
determined in accordance with GAAP.

 

“U.S.A. PATRIOT
Act”:  (a) the Trading with the
Enemy Act, as amended, and each of the foreign asset control regulations of the
United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended)
and any other enabling legislation or executive order relating thereto, and (b) the
Uniting and Strengthening America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism (USA PATRIOT) Act of 2001, as amended or
modified from time to time.

 

“Wholly Owned Non-Guarantor Foreign
Subsidiary”: as defined in Section 7.3(f).

 

32

 

“Wholly Owned Subsidiary”:  with respect to any Person, any corporation,
partnership, limited liability company or other entity of which all of the
equity securities or other ownership interests (other than, in the case of a
corporation, directors’ qualifying shares or equity interests held by foreign
nationals, in each case to the extent mandated by applicable law) are directly
or indirectly owned or controlled by such Person or one or more Wholly Owned
Subsidiaries of such Person.

 

“Withdrawal Liability”:  liability to a Multiemployer Plan as a result
of a complete or partial withdrawal from such Multiemployer Plan, as such terms
are defined in Part 1 of Subtitle E of Title IV of ERISA.

 

1.2.          Other Definitional Provisions.  (a) Unless
otherwise specified therein, all terms defined in this Agreement shall have the
defined meanings when used in the other Loan Documents or any certificate or
other document made or delivered pursuant hereto or thereto.

 

(b)   As used herein and in the
other Loan Documents, and any certificate or other document made or delivered
pursuant hereto or thereto, accounting terms relating to Parent, Holdings and
its Subsidiaries not defined in Section 1.1 and accounting terms partly
defined in Section 1.1, to the extent not defined, shall have the
respective meanings given to them under GAAP; provided that to the
extent any Person does not constitute a Subsidiary of the Parent and the Parent
and its Subsidiaries do not own more than a majority of the Capital Stock of
such Person, such Person shall not be required to be consolidated with the
Parent or any of its Subsidiaries for any purposes of the Loan Documents
regardless of the requirements of GAAP.

 

(c)   The words “hereof”, “herein”
and “hereunder” and words of similar import when used in this Agreement shall
refer to this Agreement as a whole and not to any particular provision of this
Agreement, and Section, Schedule and Exhibit references are to this
Agreement unless otherwise specified.

 

(d)   Except as specifically
provided herein, the meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.

 

(e)   Each reference to the “Credit
Agreement” in any Loan Document shall be deemed to be a reference to this
Agreement, as amended, restated and supplemented from time to time after the
date hereof.

 

(f)    When the payment of any
obligation or the performance of any covenant, duty or obligation is stated to
be due or performance required on a day which is not a Business Day, the date
of such payment (other than as described in the definition of Interest Period)
or performance shall extend to the immediately succeeding Business Day.

 

(g)   Notwithstanding any other
provision contained herein, all computations of amounts and ratios referred to
in this Agreement shall be made without giving effect to any election under
FASB ASC Topic 825 “Financial Instruments” (or any other financial accounting
standard having a similar result or effect) to value any Indebtedness or other
liabilities of the Borrower at “fair value” as defined therein.

 

33

 

SECTION 2.           AMOUNT
AND TERMS OF COMMITMENTS

 

2.1.          Commitments.  Subject to the terms and conditions hereof, the
Lenders severally agree to make term loans denominated in Dollars (each, a “Loan”)
to the Borrower on the Closing Date in an amount for each Lender not to exceed
the Commitment of such Lender.  The Loans
may from time to time be Eurocurrency Loans or Base Rate Loans, as determined
by the Borrower and notified to the Administrative Agent in accordance with Sections 2.2
and 3.5.

 

2.2.          Procedure for Borrowing.  The Borrower
shall deliver to the Administrative Agent irrevocable notice in the form of Exhibit K
(which notice must be received by the Administrative Agent prior to 12:00 Noon,
New York City time, (i) three Business Days prior to the anticipated
Closing Date, in the case of Eurocurrency Loans and (ii) one Business Day
prior to the anticipated Closing Date, in the case of Base Rate Loans)
requesting that the Lenders make the Loans on the Closing Date and specifying
the amount to be borrowed; provided, that until the date that is 30 days
from the Closing Date (unless the primary syndication of the Loans has been
completed on or prior to the Closing Date), the Loans shall be maintained as
either (1) Eurocurrency Loans having an Interest Period of no longer than
one month or (2) Base Rate Loans. 
Upon receipt of such notice the Administrative Agent shall promptly
notify each Lender thereof.  Not later
than 12:00 Noon, New York City time, on the Closing Date each Lender shall make
available to the Administrative Agent at the Funding Office an amount in
immediately available funds equal to the Loan to be made by such Lender.

 

2.3.          Repayment of
Loans.  The Borrower shall repay all outstanding
Loans, together with all other amounts owed hereunder with respect thereto, in
full on the Maturity Date.

 

SECTION 3.           CERTAIN
PROVISIONS APPLICABLE TO THE LOANS

 

3.1.          Repayment of Loans; Evidence of Debt.  (a) The
Borrower hereby unconditionally promises to pay to the Administrative Agent for
the account of the appropriate Lender the principal amount of the Loan made by
such Lender to the Borrower on the Maturity Date (or on such earlier date on
which the Loans become due and payable pursuant to Section 8).  The Borrower hereby further agrees to pay
interest on the unpaid principal amount of the Loans until payment in full
thereof at the rates per annum, and on the dates, set forth in Section 3.7.

 

(b)   Each Lender shall maintain
in accordance with its usual practice an account or accounts evidencing
indebtedness of the Borrower to such Lender resulting from the Loan of such
Lender to the Borrower, including the amounts of principal and interest payable
and paid to such Lender from time to time under this Agreement.

 

(c)   The Administrative Agent, on
behalf of the Borrower, shall maintain the Register pursuant to Section 10.6(b)(iv), and
a subaccount therein for each Lender, in which shall be recorded (i) the
amount of each Loan made or continued hereunder and any Note evidencing such
Loan, the Type of such Loan and each Interest Period applicable thereto, (ii) the
amount of any principal or interest due and payable or to become due and
payable from the Borrower to each Lender hereunder and (iii) both the
amount of any sum received by the Administrative Agent hereunder from the
Borrower and each Lender’s share thereof.

 

34

 

(d)   The entries made in the
Register and the accounts of each Lender maintained pursuant to Section 3.1(b) shall,
to the extent permitted by applicable law, be prima  facie
evidence of the existence and amounts of the obligations of the Borrower
therein recorded; provided, however, that the failure of any
Lender or the Administrative Agent to maintain the Register or any such
account, or any error therein, shall not in any manner affect the obligation of
the Borrower to repay (with applicable interest) the Loan made to the Borrower
by such Lender in accordance with the terms of this Agreement.

 

(e)   The Borrower agrees that,
upon the request to the Administrative Agent by any Lender, the Borrower will
execute and deliver to such Lender a promissory note of the Borrower evidencing
the Loan of such Lender, substantially in the form of Exhibit G,
with appropriate insertions as to date and principal amount.

 

3.2.          Fees.

 

(a)   The Borrower agrees to pay
to the Administrative Agent the fees in the amounts and on the dates from time
to time agreed to in writing by the Borrower and the Administrative Agent.

 

(b)   The Borrower agrees to pay
on the Closing Date to each Lender party to this Agreement as a Lender on the
Closing Date, as fee compensation for the funding of such Lender’s Loan, a
closing fee in an amount equal to 1.5% of the stated principal amount of such
Lender’s Loan, payable to such Lender from the proceeds of its Loan as and when
funded on the Closing Date.  Such closing
fee will be in all respects fully earned, due and payable on the Closing Date
and non-refundable and non-creditable thereafter.

 

3.3.          Optional Prepayments.  Subject to the terms of the First Lien Loan Documents
and the Intercreditor Agreement, and to Section 3.7(e), the Borrower may
at any time and from time to time prepay the Loans made to it, in whole or in
part, without premium or penalty (except as set forth in Section 3.7(e)),
upon irrevocable notice delivered to the Administrative Agent at least three
Business Days prior thereto in the case of Eurocurrency Loans and at least one
Business Day prior thereto in the case of Base Rate Loans, which notice shall
specify the date and amount of prepayment and whether the prepayment is of
Eurocurrency Loans or Base Rate Loans; provided, that if a Eurocurrency
Loan is prepaid on any day other than the last day of the Interest Period
applicable thereto, the Borrower shall also pay any amounts owing pursuant to Section 3.13.  Upon receipt of any such notice the
Administrative Agent shall promptly notify each relevant Lender thereof.  If any such notice is given, the amount
specified in such notice shall be due and payable on the date specified
therein, together with accrued interest to such date on the amount prepaid and
any additional amounts required pursuant to Section 3.7(e).  Partial prepayments of Loans shall be in an
aggregate principal amount of $1,000,000 or a whole multiple thereof.

 

3.4.          Mandatory
Prepayments.  So long as (x) the First Lien
Obligations have been paid in full and all commitments thereunder have been
terminated and all letters of credit issued thereunder have been terminated or
fully cash collateralized in accordance with the terms of the First Lien Credit
Documents, or (y) expressly permitted under the First Lien Credit 

 

35

 

Agreement or (z) due
to a rejection of a mandatory prepayment of First Lien Tranche B Term Loans
pursuant to Section 5.11(d) of the First Lien Credit Agreement:

 

(a)   If any Indebtedness shall be
incurred by Parent, Holdings or the Borrower or any of its Subsidiaries
(excluding any Indebtedness permitted by Section 7.3 other than (i) Section 7.3(a) (to
the extent pertaining to any refinancing, refund, replacement or renewal of
Indebtedness pursuant to the Loan Documents), (ii) Section 7.3(n)(i) (to
the extent the Net Cash Proceeds of such Indebtedness are not applied by the
Borrower to purchase First Lien Tranche B Term Loans pursuant to a First Lien
Auction or Loans pursuant to an Auction as set forth in Section 3.18) and (iii) subclauses
(ii) and (iii) of 7.3(n)), then, on the date of such incurrence the
Loans shall be prepaid, by an amount equal to the IP Percentage (or as set
forth in Section 7.3(n)(ii)) of the Net Cash Proceeds of such incurrence,
as set forth in Section 3.4(d).

 

(b)   If on any date the Borrower
or any of its Subsidiaries shall receive Net Cash Proceeds from any Asset Sale
or Recovery Event, the Loans shall be prepaid, on or before the date which is
five days following the date of receipt of such Net Cash Proceeds, by an amount
equal to the amount of such Net Cash Proceeds, as set forth in Section 3.4(d);
provided that, notwithstanding the foregoing, no prepayment of the Loans
shall be required to be made under this Section 3.4(b) in respect of (i) the
Net Cash Proceeds received by the Borrower or any of its Subsidiaries from any
Asset Sale or Recovery Event in respect of which a Reinvestment Notice has been
delivered (or is delivered within 30 days), so long as, on each Reinvestment
Prepayment Date, the Loans shall be prepaid by an amount equal to the
Reinvestment Prepayment Amount with respect to the relevant Asset Sale or
Recovery Event, as set forth in Section 3.4(d) and (ii) RP
Eligible Proceeds, to the extent such RP Eligible Proceeds are used within 90
days of the Disposition which is the source of such RP Eligible Proceeds to
make a Restricted Payment permitted to be made under Section 7.6(h), in an
aggregate amount not to exceed $300,000,000.

 

(c)   Subject to the last sentence
of this paragraph, if, for any fiscal year of the Borrower commencing with the
fiscal year ending December 31, 2011, there shall be Excess Cash Flow,
then, on the relevant Excess Cash Flow Application Date, the Loans shall be
prepaid by an amount equal to 50% of such Excess Cash Flow during such fiscal
year as set forth in Section 3.4(d).  Each such prepayment shall be made on July 15
of the following fiscal year, beginning on July 15, 2012 (an “Excess
Cash Flow Application Date”).

 

(d)   The application of any
prepayment of Loans pursuant to this Section shall be made, first,
to Base Rate Loans and, second, to Eurocurrency Loans.  Each prepayment of the Loans under this Section shall
be accompanied by accrued interest to the date of such prepayment on the amount
prepaid.   Pending the final application
of Net Cash Proceeds, the Borrower may temporarily prepay outstanding First
Lien Revolving Credit Loans and/or First Lien Swing Line Loans or otherwise
make Permitted Investments.

 

Notwithstanding
any of the other provisions of this Section 3.4, so long as no Event of
Default shall have occurred and be continuing, if any prepayment of
Eurocurrency Loans is required to be made under this Section 3.4 prior to
the last day of the Interest Period therefor and less than three months are
remaining in such Interest Period, in lieu of making any payment pursuant to
this Section 3.4 in respect of any such Eurocurrency Loan prior to the
last 

 

36

 

day of
the Interest Period therefor, the Borrower may, in its sole discretion, deposit
the amount of any such prepayment otherwise required to be made into a cash
collateral account maintained with the Administrative Agent until the last day
of such Interest Period, at which time the Administrative Agent shall be
authorized (without any further action by or notice to or from the Borrower or
any other Loan Party) to apply such amount to the prepayment of such Loans in
accordance with this Section 3.4. 
Upon the occurrence and during the continuance of any Event of Default,
the Administrative Agent shall also be authorized (without any further action
by or notice to or from the Borrower or any other Loan Party) to apply such
amount to the prepayment of the outstanding Loans in accordance with the relevant
provisions of this Section 3.4.

 

3.5.          Conversion and Continuation Options.  (a) The
Borrower may elect from time to time to convert Eurocurrency Loans of the
Borrower to Base Rate Loans by giving the Administrative Agent at least two
Business Days’ prior irrevocable notice of such election, provided that
any such conversion of Eurocurrency Loans may be made only on the last day of
an Interest Period with respect thereto. 
The Borrower may elect from time to time to convert Base Rate Loans to
Eurocurrency Loans by giving the Administrative Agent at least three Business
Days’ prior irrevocable notice of such election (which notice shall specify the
length of the initial Interest Period therefor), provided that no Base
Rate Loan may be converted into a Eurocurrency Loan (i) when any Event of
Default has occurred and is continuing and the Administrative Agent has, or the
Required Lenders have determined in its or their sole discretion not to permit
such conversions or (ii) after the date that is one month prior to the
Maturity Date.  Upon receipt of any such
notice the Administrative Agent shall promptly notify each relevant Lender
thereof.

 

(b)   The Borrower may elect to
continue any Eurocurrency Loan as Eurocurrency Loans upon the expiration of the
then current Interest Period with respect thereto by giving irrevocable notice
to the Administrative Agent, in accordance with the applicable provisions of
the term “Interest Period” set forth in Section 1.1, of the length
of the next Interest Period to be applicable to such Loans, provided
that no Eurocurrency Loan may be continued as such (i) when any Event of
Default has occurred and is continuing and the Administrative Agent has, or the
Required Lenders have determined in its or their sole discretion not to permit
such continuations or (ii) after the date that is one month prior to the
Maturity Date, and provided, further, that if the Borrower shall
fail to give any required notice as described above in this paragraph or if
such continuation is not permitted pursuant to the preceding proviso, such
Loans shall be converted automatically to Base Rate Loans on the last day of
such then expiring Interest Period.  Upon
receipt of any such notice the Administrative Agent shall promptly notify each
relevant Lender thereof.

 

3.6.          Minimum Amounts and Maximum Number of
Eurocurrency Tranches.  Notwithstanding anything to
the contrary in this Agreement, all borrowings, conversions, continuations and
optional prepayments of Eurocurrency Loans and all selections of Interest Periods
shall be in such amounts and be made pursuant to such elections so that, (a) after
giving effect thereto, the aggregate principal amount of the Eurocurrency Loans
comprising each Eurocurrency Tranche shall be equal to $5,000,000 or a whole
multiple of $1,000,000 in excess thereof and (b) no more than 12
Eurocurrency Tranches shall be outstanding at any one time.

 

37

 

3.7.          Interest Rates; Payment Dates; Prepayment
Premium.  (a) Each Eurocurrency Loan shall bear
interest for each day during each Interest Period with respect thereto at a
rate per annum equal to the Eurocurrency Rate determined for such day plus the
Applicable Margin.

 

(b)   Each Base Rate Loan shall
bear interest at a rate per annum equal to the Base Rate plus the
Applicable Margin.

 

(c)   (i) If all or a portion
of the principal amount of any Loan shall not be paid when due (whether at the
stated maturity, by acceleration or otherwise), all outstanding Loans (whether
or not overdue) shall bear interest at a rate per annum that is equal to the
rate that would otherwise be applicable thereto pursuant to the foregoing
provisions of this Section plus 2%, and (ii) if all or a
portion of any interest payable on any Loan or other amount payable hereunder
shall not be paid when due (whether at the stated maturity, by acceleration or
otherwise), such overdue amount shall bear interest at a rate per annum equal
to the rate then applicable to Base Rate Loans plus 2%, in each case,
with respect to clauses (i) and (ii) above, from the date of such
non-payment until such amount is paid in full (after as well as before
judgment).

 

(d)   Interest shall be payable in
arrears on each Interest Payment Date, provided that interest accruing
pursuant to paragraph (c) of this Section shall be payable from time
to time on demand.

 

(e)   In the event that all or any
portion of the Loans are repaid, either pursuant to Section 3.3 or Section 3.4,
or repriced in a manner that results in the interest rate payable on the Loans
being lower than the interest rate in effect immediately prior to such
refinancing or effectively refinanced through any amendment of this Agreement,
(other than as a result of the lenders under the First Lien Credit Agreement
exercising their right to reject mandatory prepayments pursuant to Section 5.11(d) thereof)
prior to the third anniversary of the Closing Date, the Borrower shall pay
Lenders a prepayment premium in an amount equal to (i) 3.0% of the
principal amount of Loans being prepaid or repriced if such prepayment or
repricing occurs prior to the first anniversary of the Closing Date, (ii) 2.0%
of the principal amount of Loans being prepaid or repriced if such prepayment
or repricing occurs after the first anniversary of the Closing Date, but on or
prior to the second anniversary of the Closing Date or (iii) 1.0% of the
principal amount of Loans being prepaid or repriced if such prepayment or
repricing occurs after the second anniversary of the Closing Date, but on or
prior to the third anniversary of the Closing Date.

 

3.8.          Computation of Interest and Fees.  (a) Interest,
fees and commissions payable pursuant hereto shall be calculated on the basis
of a 360-day year for the actual days elapsed, except that, with respect to
Base Rate Loans on which interest is calculated on the basis of the Prime Rate,
the interest thereon shall be calculated on the basis of a 365- (or 366-, as
the case may be) day year for the actual days elapsed.  The Administrative Agent shall as soon as
practicable notify the Borrower and the relevant Lenders of each determination
of a Eurocurrency Rate.  Any change in
the interest rate on a Loan resulting from a change in the Base Rate or the
Eurocurrency Reserve Requirements shall become effective as of the opening of
business on the day on which such change becomes effective.  The Administrative Agent shall as 

 

38

 

soon as practicable
notify the Borrower and the relevant Lenders of the effective date and the
amount of each such change in interest rate.

 

(b)   Each determination of an
interest rate by the Administrative Agent pursuant to any provision of this
Agreement shall be conclusive and binding on the Borrower and the Lenders in
the absence of manifest error.  The Administrative
Agent shall, at the request of the Borrower, deliver to the Borrower a
statement showing the quotations used by the Administrative Agent in
determining any interest rate pursuant to Section 3.7(a).

 

3.9.          Inability to Determine Interest Rate. 
If prior to the first day of any Interest Period:

 

(a)   the Administrative Agent
shall have determined (which determination shall be conclusive and binding upon
the Borrower) that, by reason of circumstances affecting the relevant market,
adequate and reasonable means do not exist for ascertaining the Eurocurrency
Rate for such Interest Period, or

 

(b)   the Administrative Agent
shall have received notice from the Required Lenders that the Eurocurrency Rate
to be determined for such Interest Period will not adequately and fairly
reflect the cost to such Lenders (as conclusively certified by such Lenders) of
maintaining their affected Loans during such Interest Period,

 

the Administrative Agent shall give telecopy
or telephonic notice thereof to the Borrower and the relevant Lenders as soon
as practicable thereafter.  If such
notice is given any Loans (x) that were to have been converted on the
first day of such Interest Period to Eurocurrency Loans shall be continued as
Base Rate Loans and (y) any outstanding Eurocurrency Loans shall be
converted, on the last day of the then current Interest Period with respect
thereto, to Base Rate Loans.  Until such
notice has been withdrawn by the Administrative Agent, no further Eurocurrency
Loans shall be made or continued as such, nor shall the Borrower have the right
to convert Loans to Eurocurrency Loans.

 

3.10.        Pro Rata Treatment and Payments.  (a) Except
as otherwise provided in this Agreement, each payment (including each
prepayment) of the Loans shall be allocated among the Lenders pro  rata
based on the principal amount of Loans held by such Lenders.  Amounts prepaid on account of the Loans may
not be reborrowed.

 

(b)   All payments (including
prepayments) to be made by the Borrower hereunder, whether on account of
principal, interest, fees or otherwise, shall be made without setoff or
counterclaim and shall be made prior to 12:00 Noon, New York City time, on the
due date thereof to the Administrative Agent, for the account of the Lenders,
at the Payment Office, in Dollars and in immediately available funds.  Any payment made by the Borrower after 12:00
Noon, New York City time, on any Business Day shall be deemed to have been made
on the next following Business Day.  The
Administrative Agent shall distribute such payments to the Lenders entitled
thereto promptly upon receipt in like funds as received.  If any payment hereunder (other than payments
on the Eurocurrency Loans) becomes due and payable on a day other than a
Business Day, such payment shall be extended to the next succeeding Business
Day.  If any payment on a Eurocurrency
Loan becomes due and payable on a day other than a Business 

 

39

 

Day, the maturity thereof shall be extended
to the next succeeding Business Day unless the result of such extension would
be to extend such payment into another calendar month, in which event such
payment shall be made on the immediately preceding Business Day.  In the case of any extension of any payment
of principal pursuant to the preceding two sentences, interest thereon shall be
payable at the then applicable rate during such extension.

 

(c)   Unless the Administrative
Agent shall have been notified in writing by the Borrower prior to the date of
any payment due to be made by the Borrower hereunder that the Borrower will not
make such payment to the Administrative Agent, the Administrative Agent may
assume that the Borrower is making such payment, and the Administrative Agent
may, but shall not be required to, in reliance upon such assumption, make available
to the Lenders their respective pro  rata shares of a
corresponding amount.  If such payment is
not made to the Administrative Agent by the Borrower within three Business Days
after such due date, the Administrative Agent shall be entitled to recover, on
demand, from each Lender to which any amount was made available pursuant to the
preceding sentence, such amount with interest thereon at the rate per annum
equal to the daily average Federal Funds Effective Rate.  Nothing herein shall be deemed to limit the
rights of the Administrative Agent or any Lender against the Borrower.

 

(d)   Notwithstanding anything to
the contrary in Sections 3.4 or 3.10, each Lender may, at its option, decline
all or any portion of any mandatory payment applicable to the Loan of such
Lender; accordingly, with respect to the amount of any mandatory prepayment
described in Section 3.4 that is allocated to its Loans (such amount, the “Prepayment
Amount”), Parent will, in lieu of applying such amount to the prepayment of
Loans, as provided in Section 3.4(d), on the date specified in Section 3.4
for such prepayment, give the Administrative Agent telephonic notice (promptly
confirmed in writing) requesting that the Administrative Agent prepare and
provide to each Lender a notice (each, a “Prepayment Option Notice”) as
described below.  As promptly as
practicable after receiving such notice from Holdings, the Administrative Agent
will send to each Lender a Prepayment Option Notice, which shall be in the form
of Exhibit H, and shall include an offer by Parent to cause the
Borrower to prepay on the date (each a “Prepayment Date”) that is 2
Business Days after the date of the Prepayment Option Notice, the Loan of such
Lender by an amount equal to the portion of the Prepayment Amount indicated in
such Lender’s Prepayment Option Notice as being applicable to such Lender’s
Loan.  On the Prepayment Date, (i) the
Borrower shall pay to the Administrative Agent the aggregate amount necessary
to prepay that portion of the outstanding Loans in respect of which Lenders
have accepted prepayment as described above (such Lenders, the “Accepting
Lenders”), and such amount shall be applied to reduce the Prepayment
Amounts, as applicable, with respect to each Accepting Lender and (ii) the
Borrower shall retain the remaining portion of the Prepayment Amount not
accepted by the Lenders; provided, however, that if after giving
pro forma effect to the transactions described in clause (ii) the Senior
Secured Leverage Ratio would be greater than 3.00 to 1.00, the Lenders shall
not have the option to decline such mandatory prepayment and all such Net Cash
Proceeds shall be applied toward the Loans.

 

3.11.        Requirements of Law.  (a) If
the adoption of or any change in any Requirement of Law or in the
interpretation or application thereof or compliance by any Lender with any
request or directive (whether or not having the force of law) from any central
bank or other Governmental Authority made subsequent to the date hereof:

 

40

 

(i)            shall impose,
modify or hold applicable any reserve, special deposit, compulsory loan or
similar requirement against assets held by, deposits or other liabilities in or
for the account of, advances, loans or other extensions of credit by, or any
other acquisition of funds by, any office of such Lender that is not otherwise
included in the determination of the Eurocurrency Rate hereunder; or

 

(ii)           shall impose on
such Lender any other condition;

 

and the result of any of the foregoing is to
increase the cost to such Lender, by an amount which such Lender reasonably
deems to be material, of converting into, continuing or maintaining
Eurocurrency Loans, or to reduce any amount receivable hereunder in respect
thereof, then, in any such case, the Borrower shall promptly pay such Lender,
upon its demand, any additional amounts necessary to compensate such Lender for
such increased cost or reduced amount receivable.  If any Lender becomes entitled to claim any
additional amounts pursuant to this Section, it shall promptly notify the
Borrower (with a copy to the Administrative Agent) of the event by reason of
which it has become so entitled.  No
amount shall be payable pursuant to this Section 3.11 with respect to
Taxes, the indemnification of which shall be governed solely and exclusively by
Section 3.12.

 

(b)   If any Lender shall have
determined that the adoption of or any change in any Requirement of Law
regarding capital adequacy or in the interpretation or application thereof or
compliance by such Lender or any corporation controlling such Lender with any
request or directive regarding capital adequacy (whether or not having the
force of law) from any Governmental Authority made subsequent to the date
hereof shall have the effect of reducing the rate of return on such Lender’s or
such corporation’s capital as a consequence of its obligations hereunder to a
level below that which such Lender or such corporation could have achieved but
for such adoption, change or compliance (taking into consideration such Lender’s
or such corporation’s policies with respect to capital adequacy) by an amount
deemed by such Lender to be material, then from time to time, after submission
by such Lender to the Borrower (with a copy to the Administrative Agent) of a
written request therefor, the Borrower shall pay to such Lender such additional
amount or amounts as will compensate such Lender or such corporation for such
reduction.

 

(c)   A certificate as to any
additional amounts payable pursuant to this Section submitted by any Lender
to the Borrower (with a copy to the Administrative Agent) shall be conclusive
in the absence of manifest error.  The
obligations of the Borrower pursuant to this Section shall survive the
termination of this Agreement and the payment of the Loans and all other
amounts payable hereunder.

 

(d)   The Borrower shall not be
required to compensate a Lender pursuant to Section 3.11 for any such
increased cost or reduction incurred more than 180 days prior to the date that
such Lender demands, or notifies the Borrower of its intention to demand,
compensation therefor, provided that, if the circumstance giving rise to such
increased cost or reduction is retroactive, then such 180-day period referred
to above shall be extended to include the period of retroactive effect thereof.

 

41

 

3.12.        Taxes.  (a) All
payments made by or on behalf of the Borrower under this Agreement shall be
made free and clear of, and without deduction or withholding for or on account
of, any Indemnified Taxes.  If any such
Indemnified Taxes are required to be withheld from any amounts payable to any
Agent, Lender or Transferee hereunder, the amounts so payable to such Agent,
Lender or Transferee shall be increased to the extent necessary so that after
making all required deductions and withholdings (including deductions or
withholdings applicable to additional sums payable under this Section 3.12), such Agent, Lender or Transferee receives an amount equal to
the after tax sum it
would have received had no such deductions or withholdings been made.

 

(b)   To the extent not subject to
Section 3.12(a), the Borrower shall pay
any Other Taxes to the relevant Governmental Authority in accordance with
applicable law.

 

(c)   Whenever any Indemnified
Taxes are payable by the Borrower, reasonably promptly thereafter, the Borrower
shall send to the Administrative Agent for the account of the relevant Agent or
Lender, as the case may be, a certified copy of an original official receipt
received by the Borrower showing payment thereof, a copy of the return
reporting such payment or other evidence of such payment reasonably
satisfactory to the Administrative Agent. 
If the Borrower fails to pay any Indemnified Taxes when due to the
appropriate taxing authority or fails to remit to the Administrative Agent the
required receipts or other required documentary evidence, the Borrower shall
indemnify the Agents, the Lenders and Transferees for any incremental Taxes,
interest or penalties that may become payable by any Agent, Lender or
Transferee as a result of any such failure except to the extent any such
penalties, interest or expenses were due to (i) the failure of the Agent,
Lender or Transferee to promptly notify the Borrower of such Indemnified Taxes
after such Agent, Lender or Transferee obtains actual knowledge of such
Indemnified Taxes or (ii)  the gross negligence or willful misconduct of
the Agent, Lender or Transferee.  The
agreements in this Section 3.12 shall survive
the termination of this Agreement and the payment of the Loans and all other
amounts payable hereunder.

 

(d)   The Borrower shall indemnify
and hold harmless, any Agent, each Lender or Transferee to the extent required
by Section 3.12 (a) or (b) within
15 Business Days after written demand therefor, for the full amount of any
Indemnified Taxes imposed on the Agent or such Lender or Transferee, as the
case may be, on or with respect to any payment by or on account of any
obligation of any Borrower hereunder or under any other Loan Document
(including Indemnified Taxes imposed or asserted on or attributable to amounts
payable under this Section 3.12), whether or
not such Indemnified Taxes were correctly or legally imposed or asserted by the
relevant Governmental Authority.

 

(e)   Each Lender, Transferee or
Agent that is not a citizen or resident of the United States of America, a
corporation, partnership or other entity created or organized in or under the
laws of the United States of America (or any jurisdiction thereof), or any
estate or trust that is subject to federal income taxation regardless of the
source of its income (each a “Non-U.S. Lender”) shall deliver to the
Borrower and the Administrative Agent (or, in the case of a Participant, to the
Lender from which the related participation shall have been purchased for
transmittal to the Borrower and the Administrative Agent) two copies of U.S.
Internal Revenue Service Form W-8BEN, Form W-8ECI or Form W-8IMY
(together with all additional documentation required to be transmitted with Form W-8IMY,
including the appropriate forms 

 

42

 

described in this Section), as applicable, or
any subsequent versions thereof or successors thereto properly completed and
duly executed by such Non-U.S. Lender (i) certifying each such Form W-8BEN
or W-8ECI filer’s entitlement to a zero rate of, or a complete exemption from,
or a reduced rate of, U.S. federal withholding tax on all payments by the
Borrower under this Agreement and the other Loan Documents, or (ii) if the
Non-U.S. Lender is claiming exemption from U.S. federal withholding tax under Section 871(h) or
881(c) of the Code with respect to payments of “portfolio interest”,
attaching to such Non-U.S. Lender’s Form W-8BEN a statement substantially
in the form of Exhibit I. 
Such forms shall be true and accurate and shall be delivered by each
Non-U.S. Lender on or before the date it becomes a party to this Agreement (or,
in the case of any Participant, on or before the date such Participant
purchases the related participation) and promptly from time to time thereafter
upon the reasonable request of the Borrower or the Administrative Agent.  In addition, each Non-U.S. Lender shall
deliver such forms promptly upon the obsolescence or invalidity of any form
previously delivered by such Non-U.S. Lender. 
Each Non-U.S. Lender shall promptly notify the Borrower at any time it
determines that it is no longer in a position to provide any previously
delivered certificate to the Borrower (or any other form of certification
adopted by the U.S. taxing authorities for such purpose).  Notwithstanding any other provision of this
paragraph, a Non-U.S. Lender shall not be required to deliver any form pursuant
to this paragraph that such Non-U.S. Lender is not legally able to
deliver.  Each Lender (or Transferee) or
Agent that is not a Non-U.S. Lender shall furnish an accurate and complete U.S.
Internal Revenue Service Form W-9 (or successor form) establishing that
such Lender (or Transferee) or Agent is not subject to U.S. backup withholding,
and to the extent it may lawfully do so at such times, provide a new Form W-9
(or successor form) upon the expiration or obsolescence of any previously
delivered form.

 

(f)    If any Agent, Lender or
Transferee determines, in its sole discretion, exercised in good faith, that it
has received a refund of any Indemnified Taxes as to which it has been
indemnified by the Borrower or with respect to which the Borrower has paid
additional amounts pursuant to this Section 3.12, it shall pay
over any such refund it receives to the Borrower (but only to the extent of
indemnity payments made, or additional amounts paid, by the Borrower under this
Section 3.12 with respect to the
Indemnified Taxes giving rise to such refund), net of all out-of-pocket
expenses of such Agent, Lender or Transferee (as determined in the sole
discretion exercised in good faith,  of
the Agent, Lender or Transferee) and without interest (other than any interest
paid by the relevant Governmental Authority with respect to such refund);
provided, that the Borrower, upon the request of such Agent, Lender or
Transferee, agrees to repay the amount paid over to that Borrower (plus any
penalties, interest or other charges imposed by the relevant Governmental
Authority) to such Agent, Lender or Transferee in the event such Agent, Lender
or Transferee is required to repay such refund to such Governmental
Authority.  This paragraph shall not be
construed to require any Agent, Lender or Transferee to make available its tax
returns (or any other information relating to its taxes which it deems
confidential) to the Borrower or any other Person.

 

(g)   The Agent, Lender or
Transferee shall use commercially reasonable efforts to cooperate with the
Borrower in attempting to recover any Indemnified Taxes which, in the
reasonable discretion of the Borrower, were improperly imposed, provided,
however that the Borrower shall indemnify the Agent, Lender or Transferee for
any costs it incurs in connection with complying with this subsection (g).  The Borrower shall have the right to dispute,
at its own cost, the imposition of any Indemnified Taxes (including interest
and penalties) with the relevant 

 

43

 

Governmental Authority.  This paragraph shall not be construed to
require the Administrative Agent or any Lender or Transferee to make available
its tax returns (or any other information relating to its taxes which it deems
confidential) to the Borrower or any other Person.  In no event will this subsection (g) relieve
the Borrower of its obligation to pay additional amounts to an Administrative
Agent, Lender or Transferee under this Section 3.12.

 

3.13.        Indemnity.  The Borrower agrees to indemnify each Lender
for, and to hold each Lender harmless from, any loss or expense that such
Lender may sustain or incur as a consequence of (a) default by the
Borrower in making a borrowing of, conversion into or continuation of
Eurocurrency Loans after the Borrower has given a notice requesting the same in
accordance with the provisions of this Agreement, (b) default by the
Borrower in making any prepayment after the Borrower has given a notice thereof
in accordance with the provisions of this Agreement or (c) the making by
the Borrower of a prepayment or conversion of Eurocurrency Loans on a day that
is not the last day of an Interest Period with respect thereto.  Such indemnification may include an amount
equal to the excess, if any, of (i) the amount of interest that would have
accrued on the amount so prepaid, or not so borrowed, converted or continued,
for the period from the date of such prepayment or of such failure to borrow,
convert or continue to the last day of such Interest Period (or, in the case of
a failure to borrow, convert or continue, the Interest Period that would have
commenced on the date of such failure) in each case at the applicable rate of
interest for such Loans provided for herein (excluding, however, the Applicable
Margin included therein, if any) over (ii) the amount of interest (as
reasonably determined by such Lender) that would have accrued to such Lender on
such amount by placing such amount on deposit for a comparable period with
leading banks in the interbank Eurocurrency market.  A certificate as to any amounts payable
pursuant to this Section submitted to the Borrower, on behalf of the
Borrower, by any Lender shall be conclusive in the absence of manifest
error.  This covenant shall survive the
termination of this Agreement and the payment of the Loans and all other
amounts payable hereunder.

 

3.14.        Illegality.  Notwithstanding any other provision herein,
if the adoption of or any change after the date hereof in any Requirement of
Law or in the interpretation or application thereof after the date hereof shall
make it unlawful for any Lender to make or maintain Eurocurrency Loans as
contemplated by this Agreement, (a) the commitment of such Lender
hereunder to make Eurocurrency Loans, continue Eurocurrency Loans as such and
convert Base Rate Loans to Eurocurrency Loans shall forthwith be canceled and (b) such
Lender’s Loans then outstanding as Eurocurrency Loans, if any, shall be
converted automatically to Base Rate Loans on the respective last days of the
then current Interest Periods with respect to such Loans or within such earlier
period as required by law.  If any such
conversion of a Eurocurrency Loan occurs on a day which is not the last day of
the then current Interest Period with respect thereto, the Borrower in respect
of such Eurocurrency Loans shall pay to such Lender such amounts, if any, as
may be required pursuant to Section 3.13.

 

3.15.        Change of Lending Office.  Each Lender agrees that, upon the occurrence
of any event giving rise to the operation of Sections 3.11, 3.12 or 3.14 with
respect to such Lender, it will, if requested by the Borrower, use reasonable
efforts (subject to overall policy considerations of such Lender) to designate
another lending office for any Loans affected by such event with the object of
avoiding the consequences of such event; provided, that such designation
is made on terms that, in the sole judgment of such Lender, cause such Lender
and 

 

44

 

its lending office(s) to
suffer no economic, legal or regulatory disadvantage, and provided, further,
that nothing in this Section shall affect or postpone any of the
obligations of the Borrower or the rights of any Lender pursuant to Sections
3.11, 3.12 or 3.14.

 

3.16.        Replacement of Lenders under
Certain Circumstances.  The
Borrower shall be permitted to replace any Lender that requests reimbursement
for amounts owing pursuant to Section 3.11 or 3.12, or gives a notice of
illegality pursuant to Section 3.14 or (b) becomes a Non-Consenting
Lender, with a replacement financial institution; provided that (i) such
replacement does not conflict with any Requirement of Law, (ii) solely
with respect to clause (a) above, no Default or Event of Default shall
have occurred and be continuing at the time of such replacement, (iii) if
applicable, prior to any such replacement, such Lender shall not have taken all
actions under Section 3.15 so as to eliminate the continued need for
payment of amounts owing pursuant to Section 3.11 or 3.12 or to eliminate
any illegality described in a notice of illegality under Section 3.14, (iv) if
applicable, the replacement financial institution shall purchase, at par, all
Loans and other amounts owing to such replaced Lender on or prior to the date
of replacement, (v) if applicable, the Borrower shall be liable to such
replaced Lender under Section 3.13 (as though Section 3.13 were
applicable) if any Eurocurrency Loan owing to such replaced Lender shall be
purchased other than on the last day of the Interest Period relating thereto, (vi) if
applicable, the replacement financial institution, if not already a Lender, an
affiliate of a Lender or an Approved Fund, shall be reasonably satisfactory to
the Administrative Agent, (vii)  if applicable, the replaced Lender shall
be obligated to make such replacement, without such Lender’s consent, in
accordance with the provisions of Section 10.6 (provided that the
Borrower shall be obligated to pay the registration and processing fee referred
to therein), (viii) if applicable, the Borrower shall pay all additional
amounts (if any) required pursuant to Section 3.11 or 3.12, as the case
may be, in respect of any period prior to the date on which such replacement
shall be consummated, and (ix) any such replacement shall not be deemed to
be a waiver of any rights that the Borrower, the Administrative Agent or any
other Lender shall have against the replaced Lender; provided that
in the case of any Assignee in respect of Non-Consenting Lenders, the
replacement Lender shall agree to the consent, waiver or amendment to which the
Non-Consenting Lender did not agree.

 

3.17.        Loan Auctions.  (a) Notwithstanding any provision in this
Agreement or the other Loan Documents to the contrary, the Borrower shall be
permitted to enter into an Auction so long as each of the Lenders hereunder
shall be offered an opportunity to ratably participate in the applicable
Auction, provided, that (i) the Borrower shall be in compliance
with Sections 7.1 and 7.2 immediately before and immediately after giving
effect to such Auction on a pro  forma basis and (ii) Liquidity
shall be no less than (x) $75,000,000, if the Auction is scheduled during
the months of March, April and May of any given year, (y) $250,000,000,
if the Auction is scheduled during the months of August, September, October and
November of any given year, and (z) $150,000,000, if the Auction is
scheduled during any other month of any given year, each on a pro  forma
basis immediately after giving effect to such Auction (assuming maximum
participation therein).

 

(b)   Concurrently with the
effectiveness of any Assignment and Acceptance pursuant to which the Borrower
becomes a Lender hereunder, any Loans held by the Borrower shall be
automatically cancelled (and may not be resold by the Borrower) and no interest
shall accrue on such Loans after such date. 
Upon the automatic cancellation of any Loans held by the 

 

45

 

Borrower, the Borrower shall no longer be a
Lender hereunder and such Loans shall be no longer outstanding for all purposes
of this Agreement and all other Loan Documents, including, but not limited to (i) the
making of, or the application of, any payments to the Lenders pursuant to this
Agreement or any other Loan Document, (ii) the making of any request,
demand, authorization, direction, notice, consent or waiver pursuant to this
Agreement or any other Loan Document, (iii) the calculation of financial
covenants, (iv) the determination of Required Lenders, or (v) for any
similar or related purpose, pursuant to this Agreement or any other Loan
Document.

 

(c)   The parties hereto hereby
agree that any Auction and cancellation of Loans will not constitute a
voluntary prepayment made by the Borrower for any purpose under this Agreement
and the other Loan Documents and shall not be subject to Sections 3.3, 3.4,
3.10 or 10.7.

 

3.18.        Auction Procedures.  (a) In
connection with an Auction, the Borrower will provide notification to the
Administrative Agent (for distribution to the Lenders) of the Auction (an “Auction
Notice”), which shall be substantially in the form of Exhibit L.  Each Auction Notice shall contain (i) the
total cash value of the bid, in a minimum amount of $5,000,000 with minimum
increments of $1,000,000 (the “Auction Amount”), and (ii) the
discount to par, which shall be a range (the “Discount Range”) of
percentages of the par principal amount of the Loans that represents the range
of purchase prices that could be paid in the Auction.

 

(b)   In connection with any
Auction, each Lender may, in its sole discretion, participate in such Auction
and may provide the Administrative Agent with a notice of participation (the “Return
Bid”), substantially in the form of Exhibit M, which shall
specify (i) a discount to par that must be expressed as a price (the “Reply
Discount”), which must be within the Discount Range, and (ii) a
principal amount of Loans that such Lender is willing to offer for sale at its
Reply Discount which must be in increments of $500,000 (the “Reply Amount”).   A Lender may avoid the minimum increment
amount condition solely when submitting a Reply Amount equal to the Lender’s
entire remaining amount of such Loans. 
Lenders may only submit one Return Bid per Auction but each Return Bid
may contain up to three component bids only one of which can result in a
Qualifying Bid (as defined below).  In
addition to the Return Bid, the participating Lender must execute and deliver,
to be held in escrow by the Administrative Agent, an Assignment and Acceptance.
The Borrower will not have any obligation to purchase any Loans at a price that
is outside the applicable Discount Range. The processing and recordation fees
as set forth in Section 10.6 hereof shall not be applicable to any
Auctions (it being understood and agreed that other fees may be applicable in
connection with any Auction).

 

(c)   Based on the Reply Discounts
and Reply Amounts received by the Administrative Agent, the Administrative
Agent, in consultation with the Borrower, will calculate the lowest applicable
discount (the “Applicable Discount”) for the Auction, which will be the
lower of (i) the lowest Reply Discount for which the Borrower can complete
the Auction at the Auction Amount and (ii) in the event that the Reply
Amounts are insufficient to allow the Borrower to complete a purchase of the
entire Auction Amount, the highest Reply Discount that is within the Discount
Range.  The Borrower shall purchase Loans
(or the respective portions thereof) from each Lender with a Reply Discount
that is equal to or less than the Applicable Discount (“Qualifying Bids”)
at the Applicable Discount; provided that if the aggregate proceeds required to
purchase all Loans subject to Qualifying Bids would exceed the Auction Amount
for 

 

46

 

such Auction, the Borrower shall purchase
such Loans at the Applicable Discount ratably based on the principal amounts of
such Qualifying Bids (subject to rounding requirements specified by the
Administrative Agent).  If a Lender has
submitted a Return Bid containing multiple bids at different Reply Discounts,
only the bid with the highest Reply Discount that is equal to or less than the
Applicable Discount will be deemed the Qualifying Bid of such Lender.  Each participating Lender will receive notice
of a Qualifying Bid as soon as reasonably practicable but in no case later than
five business days from the date the Return Bid was due.

 

(d)   Once initiated by an Auction
Notice, the Borrower may withdraw an Auction only in the event that, as of such
time, no Return Bid has been received by the Administrative Agent.  Furthermore, in connection with any Auction,
upon submission by a Lender of a Return Bid, such Lender (each, a “Qualifying
Lender”) will be obligated to sell the entirety or its allocable portion of
the Reply Amount, as the case may be, at the Applicable Discount.

 

(e) Notwithstanding the provisions of this Section 3.18, the Administrative Agent in consultation
with the Borrower, may amend or modify the procedures, notices, bids and
Assignment and Acceptance Agreement in connection with any Auction (including,
solely with Borrower’s consent), (i) any term to the extent Borrower’s
commercial interests will be materially adversely affected by such amendment or
modification and (ii) the economic terms to the extent no Lenders have
validly tendered Loans requested in an offer, but excluding economic terms of
an auction after any Lender has validly tendered Loans requested in an offer,
other than to increase the Auction Amount or raise the Discount Range; provided
that no such amendments or modifications may be implemented after 24 hours
prior to the date and time return bids are due.

 

(f)  By providing an Auction Notice or purchasing any Loans (or any
portions of any thereof) in the Auction initiated thereby, the Borrower shall
be deemed to represent and warrant as of the date of such notice or purchase as
the case may be that the Borrower is not in possession of any information regarding
any Loan Party; its assets, its ability perform its Obligations or any other
matter that may be material to a decision by any Lender to participate in such
Auction or participate in any of the transactions contemplated thereby, that
has not previously been disclosed to the Administrative Agent and the Lenders.

 

SECTION 4.           REPRESENTATIONS AND WARRANTIES

 

To induce the Agents and the Lenders to enter into
this Agreement and to make the Loans, Parent, Holdings and the Borrower hereby
jointly and severally represent and warrant to each Agent and each Lender that:

 

4.1.          Financial Condition.  (a) The
unaudited pro  forma consolidated balance sheet of Parent and its
consolidated Subsidiaries as at December 31, 2009 (the “Pro Forma
Balance Sheet”), copies of which have heretofore been furnished to each
Lender, has been prepared giving effect (as if such events had occurred on such
date) to (i) the Loans to be made on the Closing Date and the use of
proceeds thereof and (ii) the payment of fees and expenses in connection
with the foregoing.  The Pro Forma
Balance Sheet has been prepared in good faith based on assumptions believed by
Parent to be reasonable and as of the date of delivery thereof, and presents
fairly in all material respects on a pro  forma basis the estimated
financial position of 

 

47

 

Parent and its
consolidated Subsidiaries as at December 31, 2009, assuming that the
events specified in the preceding sentence had actually occurred at such date
and giving effect to the other assumptions set forth therein.

 

(b)   The audited consolidated
balance sheets of Parent as at December 31, 2009 and December 31,
2008, and the related consolidated statements of income and of cash flows for
the fiscal years ended on December 31, 2009, December 31, 2008 and December 31,
2007, reported on by and accompanied by a report from KPMG LLP, present fairly
in all material respects the consolidated financial condition of Parent as at
such dates, and the consolidated results of its operations and its consolidated
cash flows for the respective fiscal years then ended.

 

(c)   Parent and its Subsidiaries
do not have any material Guarantee, contingent liabilities and liabilities for
taxes, or any long-term leases or unusual forward or long-term commitments,
including any interest rate or foreign currency swap or exchange transaction or
other obligation in respect of derivatives, that are not reflected or disclosed
in the notes in the most recent financial statements of Parent referred to in this
paragraph or otherwise permitted by this Agreement and disclosed to the Lenders
in writing.  During the period from December 18,
2009 to  and including the date
hereof there has been no Disposition by Parent or any of its Subsidiaries of
any material part of its Business or Property.

 

4.2.          No Change. 
Since December 31, 2009, except as otherwise described in the
Confidential Information Memorandum and the Plan of Reorganization, there has
been no development or event that has had or could reasonably be expected to
have a Material Adverse Effect.

 

4.3.          Existence;
Compliance with Law.  Each of Parent, Holdings and its Subsidiaries
(other than the Inactive Subsidiaries) (a) is duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization, (b) has the corporate (or equivalent) power and authority,
and the legal right, to own and operate its Property, to lease the Property it
operates as lessee and to conduct the Business in which it is currently
engaged, (c) is duly qualified as a foreign entity and in good standing
under the laws of each jurisdiction where its ownership, lease or operation of
Property or the conduct of its Business requires such qualification and (d) is
in compliance with all Requirements of Law except in each case referred to in
clauses (b), (c) or (d), to the extent that the failure to comply
therewith could not, in the aggregate, reasonably be expected to have a
Material Adverse Effect.

 

4.4.          Corporate
Power; Authorization; Enforceable Obligations.  Upon entry by
the Bankruptcy Court of the Confirmation Order, each Loan Party has the
corporate (or equivalent) power and authority, and the legal right, to make,
deliver and perform the Loan Documents (as well as the corporate (or
equivalent) power and authority, and the legal right, to make and deliver the
Intercreditor Agreement) to which it is a party and to consummate the
Transactions and, in the case of the Borrower, to borrow hereunder.  Each Loan Party has taken all necessary
corporate (or equivalent) action to authorize the execution, delivery and
performance of the Loan Documents to which it is a party (as well as the
Intercreditor Agreement) and the consummation of the Transactions and, in the
case of the Borrower, to authorize the borrowings on the terms and conditions
of this Agreement.  No consent or
authorization of, filing with, notice to or other act by or in respect of, any
Governmental 

 

48

 

Authority or any other
Person is required to be obtained by any Loan Party in connection with the
Transactions and the borrowings hereunder or with the execution, delivery,
performance, validity or enforceability of this Agreement or any of the Loan
Documents, except (i) consents, authorizations, filings and notices
described in Schedule 4.4 and Schedule 4.19(b), which consents, authorizations,
filings and notices have been obtained or made and are in full force and
effect, (ii) the filings referred to in Schedule 4.19(a)-1 and Schedule
4.19(a)-2 and (iii) those approvals, consents, exemptions, authorizations
or other actions, notices or filings, the failure of which to obtain or make
could not reasonably be expected to have a Material Adverse Effect.  Each Loan Document and the Intercreditor
Agreement has been duly executed and delivered on behalf of each Loan Party
that is a party thereto.  This Agreement
constitutes, and each other Loan Document upon execution will constitute, a
legal, valid and binding obligation of each Loan Party that is a party thereto,
enforceable against each such Loan Party in accordance with its terms, except
as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors’ rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).

 

4.5.          No Legal Bar.  The execution, delivery and performance of
this Agreement and the other Loan Documents by the Loan Parties, the borrowings
hereunder, the use of the proceeds thereof and the consummation of the
Transactions will not violate any Requirement of Law applicable to, or any
Contractual Obligation of, Parent, Holdings or any of its Subsidiaries except
to the extent such violation could not reasonably be expected to have a
Material Adverse Effect and will not result in, or require, the creation or
imposition of any Lien on any of their respective Properties or revenues
pursuant to any such Requirement of Law or any such Contractual Obligation (other
than the Liens created by the Security Documents and the Liens created under
the First Lien Credit Documents).

 

4.6.          Litigation.  No litigation, investigation or proceeding of
or before any arbitrator or Governmental Authority is pending or, to the knowledge
of Parent, Holdings or the Borrower, threatened by or against Parent, Holdings
or any of its Subsidiaries or against any of their respective Properties or
revenues (a) with respect to any of the Loan Documents or any of the
transactions contemplated hereby or thereby, or (b) that, if adversely
determined, could reasonably be expected to have a Material Adverse Effect.

 

4.7.          No Default.  Neither Parent, Holdings, nor any of its
Subsidiaries is in default under or with respect to any of its Contractual
Obligations in any respect that could reasonably be expected to have a Material
Adverse Effect.  No Default or Event of
Default has occurred and is continuing.

 

4.8.          Ownership of Property; Liens.  Each of Holdings and its Subsidiaries has
title in fee simple to, or a valid leasehold interest in, all its material Real
Property, and good title to, or a valid leasehold interest in, all its other
material Property, and none of such Property (including the Real Property) is
subject to any Lien except a Permitted Lien. 
Attached as Schedule 4.8 is a list of all Real Property and Operated
Property which are material to the operation of the Business of Holdings or its
Subsidiaries as of the Closing Date.

 

49

 

4.9.          Intellectual Property.  Holdings and each of its Subsidiaries owns,
or is licensed to use, all Intellectual Property material to the conduct of its
business as currently conducted, free and clear of all Liens other than
Permitted Liens, and
takes reasonable actions to protect, preserve and maintain such Intellectual
Property.  Except as could not reasonably
be expected to have a Material Adverse Effect, all such Intellectual Property
is valid and enforceable and all registrations and applications for such Intellectual
Property have not expired or been abandoned. 
No action or proceeding is pending by any Person or, to the knowledge of Holdings or the
Borrower, threatened, or imminent, on the date hereof, and no holding, decision
or judgment has been rendered by any Governmental Authority or arbitrator which
may limit, cancel or challenge the validity, enforceability, ownership or use
of, such Intellectual Property which could reasonably be expected to have a
Material Adverse Effect, nor does Holdings or the Borrower know of any
valid basis for any such claim except for claims, actions, proceedings,
holdings, decisions or judgments which, individually or in the aggregate, could
not reasonably be expected to have a Material Adverse Effect.  The operation of the Business of Holdings and
its Subsidiaries does not infringe, impair, misappropriate or otherwise violate
the rights of any Person to an extent which could reasonably be expected to
have a Material Adverse Effect, and to the knowledge of Holdings or the Borrower,
no Person is infringing, impairing, misappropriating or otherwise violating any
Intellectual Property owned by any of Holdings or its Subsidiaries to an extent
which could reasonably be expected to have a Material Adverse Effect.

 

4.10.        Taxes.  Each of Parent, Holdings and each of its
Subsidiaries has filed or caused to be filed all Federal, state and other
material tax returns that are required to be filed and has paid all taxes shown
to be due and payable on said returns or on any assessments made against it or
any of its Property and all other material taxes, fees or other charges imposed
on it or any of its Property by any Governmental Authority (in each case other
than any taxes, fees or charges the amount or validity of which are currently
being contested in good faith by appropriate proceedings and with respect to
which reserves (to the extent required by GAAP) have been provided on the books
of Parent, Holdings or its Subsidiaries, as the case may be, and those which,
with respect to taxes or other assessments on Real Properties, can be contested
without payment under applicable law); no material tax Lien has been filed,
and, to the  knowledge of Parent,
Holdings and the Borrower, no claim is being asserted with respect to any such
tax, fee or other charge except claims that individually or in the aggregate
could not reasonably be expected to have a Material Adverse Effect.

 

4.11.        Federal Regulations.  No part of the proceeds of any Loans will be
used for “buying” or “carrying” any Margin Stock within the respective meanings
of each of the quoted terms under Regulation U as now and from time to time
hereafter in effect or for any purpose that violates the provisions of the
Regulations of the Board.  If requested
by the Administrative Agent, the Borrower will furnish to the Administrative
Agent a statement to the foregoing effect in conformity with the requirements
of FR Form G-3 or FR Form U-1, as applicable, referred to in
Regulation U.

 

4.12.        Labor Matters.  Except as, in the aggregate, could not
reasonably be expected to have a Material Adverse Effect:  (a) there are no strikes or other labor
disputes against Holdings or any of its Subsidiaries pending or, to the  knowledge of Holdings or the Borrower,
threatened; (b) hours worked by and payment made to employees of Holdings
and its 

 

50

 

Subsidiaries have not been
in violation of the Fair Labor Standards Act or any other applicable
Requirement of Law dealing with such matters; and (c) all payments due
from Holdings or any of its Subsidiaries on account of employee health and
welfare insurance have been paid or accrued as a liability on the books of
Holdings or the relevant Subsidiary.

 

4.13.        ERISA.  (a) Except
as, in the aggregate, could not reasonably be expected to have a Material
Adverse Effect, (i) no ERISA Event has occurred during the three-year
period prior to the date on which this representation is made or deemed made
with respect to any Plan, and each Plan has complied, and is in compliance,
with its terms and the applicable provisions of ERISA and the Code; (ii) no
termination of a Single Employer Plan has occurred, and no Lien in favor of the
PBGC or a Plan has arisen, during such three-year period, (iii) the
present value of all accrued benefits under each Single Employer Plan (based on
those assumptions used to fund such Plans) did not, as of the last annual
valuation date prior to the date on which this representation is made or deemed
made, exceed the value of the assets of such Plan allocable to such accrued
benefits resulting in an “at risk” status for the Single Employer Plan; and,
except as described in Schedule 4.13, the present value of all accrued benefit
obligations of all underfunded Plans (based on the assumptions used for purposes
of Statement of Financial Accounting Standards No. 87) does not exceed the
value of the assets of all such underfunded Plans; (iv) neither Parent,
Holdings, nor any ERISA Affiliate would become subject to any Withdrawal
Liability if Parent, Holdings, or any ERISA Affiliate were to withdraw
completely from all Multiemployer Plans as of the valuation date most closely
preceding the date on which this representation is made or deemed made; and (v) none
of Parent, Holdings, the Subsidiaries and the ERISA Affiliates has received any
written notification that any Multiemployer Plan is Insolvent, in
Reorganization, in “endangered” or “critical” status, or has been terminated
(all within the meaning of Title IV of ERISA), or has knowledge that any
Multiemployer Plan is reasonably expected to be Insolvent, in Reorganization,
in “endangered” or “critical” status, or terminated.

 

(b)  With respect to each employee benefit arrangement mandated by
non-U.S. law (a “Foreign Benefit Arrangement”) and with respect to each
employee benefit plan (within the meaning of Section 3(3) of ERISA,
whether or not subject to ERISA) maintained or contributed by any of Parent,
Holdings, the Subsidiaries or any ERISA Affiliate that is not subject to U.S.
law (a “Foreign Plan”), except as, in the aggregate, could not
reasonably be expected to have a Material Adverse Effect, (i) any employer
and employer contributions required by applicable law or by the terms of such
Foreign Benefit Arrangement or Foreign Plan have been made, or, if applicable,
accrued in accordance with normal accounting practices; (ii) the accrued
benefit obligations of each Foreign Plan (based on those assumptions used to
fund such Foreign Plan) with respect to all current and former participants do
not exceed the assets of such Foreign Plan; (iii) each Foreign Plan that
is required to be registered has been registered and has been maintained in
good standing with applicable regulatory authorities; and (iv) each such
Foreign Benefit Arrangement and Foreign Plan is in compliance (A) with all
applicable provisions of law and all applicable regulations and published
interpretations thereunder with respect to such Foreign Plan or Foreign Benefit
Arrangement and (B) with the terms of such plan, except, in each case, for
such noncompliance that could not reasonably be expected to have a Material
Adverse Effect.

 

51

 

4.14.        Investment Company Act; Other Regulations.  No
Loan Party is an “investment company”, or a company “controlled” by an “investment
company”, within the meaning of the Investment Company Act of 1940, as
amended.  No Loan Party is subject to
regulation under any Requirement of Law (other than Regulation X of the Board)
that limits its ability to incur Indebtedness.

 

4.15.        Subsidiaries. 
Schedule 4.15, as of the Closing Date, sets forth the name and
jurisdiction of formation of each Subsidiary (other than Inactive Subsidiaries
and other than Subsidiaries that are included in Excluded Assets (as defined in
the Guarantee and Collateral Agreement)) of Parent and, as to each such
Subsidiary, the percentage of each class of Capital Stock owned by any Loan Party,
and, except as so disclosed, there are no outstanding subscriptions, options,
warrants, calls, rights or other agreements or commitments (other than
directors’ qualifying shares) of any nature relating to any Capital Stock of
Holdings, the Borrower or any such Subsidiary, except as created by the Loan
Documents.

 

4.16.        Use of Proceeds.  The proceeds of the Loans shall be used, in
part, to consummate the transactions contemplated by the Plan of
Reorganization, pay related fees and expenses and finance the working capital
needs and general corporate purposes of the Borrower.

 

4.17.        Environmental Matters. 
Except as, in the aggregate, could not reasonably be expected to have a
Material Adverse Effect:

 

(a)   the
Real Properties, and such other amusement parks, attractions or real properties
operated solely by Parent or its Subsidiaries, or in respect of which Parent or
any of its Subsidiaries would be liable as an owner, operator or other occupant
under any Environmental Law (collectively, together with the Real Properties,
the “Operated Properties”), do not contain, and, to their knowledge,
have not previously contained, any Materials of Environmental Concern in
amounts or concentrations or under circumstances that constitute or constituted
a violation of, or could give rise to liability under, any Environmental Law;

 

(b)   neither Parent nor any of
its Subsidiaries has received or is aware of any notice of violation or alleged
violation (which has not been remediated and finally settled in accordance with
Environmental Law) of, non-compliance with, or its respective liability or
potential liability under, Environmental Laws with regard to any of the
Operated Properties or the business operated by Parent or any of its
Subsidiaries (the “Business”), nor does Parent or the Borrower have
knowledge that any such notice will be received or is being threatened;

 

(c)   Materials of Environmental
Concern have not been transported or disposed of from the Operated Properties
by or on behalf of Parent, Borrower or their Subsidiaries in violation of, or
in a manner or to a location that could give rise to liability under, any
Environmental Law, nor have any Materials of Environmental Concern been
generated, treated, stored or disposed of at, on or under any of the Operated
Properties in violation of, or in a manner that could give rise to liability to
Parent, the Borrower or any Subsidiary under, any applicable Environmental Law
which have not been remediated and finally settled in accordance with
Environmental Law;

 

52

 

(d)   no Environmental Claim is
pending or, to the knowledge of Parent and the Borrower, threatened, under any
Environmental Law to which Parent or any Subsidiary is or would reasonably be
expected to be named as a party with respect to the Operated Properties or the
Business, nor has Parent or any Subsidiary received written notice of any
consent decrees or other decrees, consent orders, administrative orders or
other orders, or other requirements of any Governmental Authority outstanding
under any Environmental Law with respect to the Operated Properties or the
Business;

 

(e)   there has been no Release or
threatened Release of Materials of Environmental Concern at or from the
Operated Properties or arising from or related to the operations of Parent or
any Subsidiary in connection with the Operated Properties or otherwise in
connection with the Business, in violation of or in amounts or in a manner that
could reasonably be expected to give rise to liability under Environmental Laws
which have not been remediated and finally settled in accordance with
Environmental Law;

 

(f)    the Operated Properties and
the Business are in compliance, and have during the last five years been in
compliance, with all applicable Environmental Laws, and there is no
contamination at, under or about the Operated Properties nor any violation of
any Environmental Law with respect to the Operated Properties or the Business;
and

 

(g)   neither Parent nor any
Subsidiary has assumed or retained any liability of any other Person under
Environmental Laws (other than assumptions by operation of law in connection
with Acquisitions or with the acquisition of any Real Properties).

 

4.18.        Accuracy of Information, Etc.  No
financial statement or written information (other than projections, estimates,
forward-looking information and information of a general industry or economic
nature) contained in this Agreement or any other Loan Document, or furnished by
or on behalf of any Loan Party in the Confidential Information Memorandum, or
contained in any other document, certificate or financial statement furnished
by or on behalf of any Loan Party to the Administrative Agent, the Lenders, the
Bankruptcy Court or any of them, for use in connection with the transactions contemplated
by this Agreement or the other Loan Documents, when considered as a whole,
contained as of the date such financial statement, written information,
document or certificate was so furnished, any untrue statement of a material
fact or omitted to state a material fact necessary to make the statements
contained herein or therein, in light of the circumstances in which they were
made not materially misleading.  The
projections, estimates and forward-looking information contained in the
materials referenced above were based upon good faith estimates and assumptions
believed by the management of Holdings to be reasonable at the time made, it
being recognized by the Lenders that such projections, estimates and
forward-looking information as it relates to future events is not to be viewed
as fact and that actual results during the period or periods covered by such
projections, estimates and forward-looking information may differ from the
projected results set forth therein, and such differences may be material.  There is no fact known to any Loan Party that
could reasonably be expected to have a Material Adverse Effect that has not
been expressly disclosed herein, in the other Loan Documents, in the
Confidential Information Memorandum, in the Plan of Reorganization or in any
other documents, certificates and written financial statements

 

53

 

furnished to the
Administrative Agent and the Lenders for use in connection with the
transactions contemplated hereby and by the other Loan Documents.

 

4.19.        Security Documents.  (a) The
Guarantee and Collateral Agreement is effective to create in favor of the
Administrative Agent, for the benefit of the Lenders, a legal, valid and
enforceable security interest in the Collateral (other than the Mortgaged
Properties) described therein and proceeds thereof.  In the case of the Pledged Stock and Pledged
Notes described in the Guarantee and Collateral Agreement, upon the
effectiveness of the Intercreditor Agreement, and when any certificates
representing such Pledged Stock or promissory notes representing Pledged Notes,
as applicable, are delivered to the First Lien Administrative Agent or the
Administrative Agent, and in the case of the other Collateral described in the
Guarantee and Collateral Agreement (other than any Deposit Accounts and future
Commercial Tort Claims, each as defined therein), when financing statements in
appropriate form are filed in the offices specified on Schedule 4.19(a)-1 (which financing statements have been
duly completed and delivered to the Administrative Agent) and such other
filings or agreements as are specified on Schedule 3 to the Guarantee and
Collateral Agreement (all documentation in respect of which other filings have
been or will have been duly completed and executed and delivered to the
Administrative Agent on or prior to the Closing Date), the Guarantee and
Collateral Agreement shall constitute a perfected Lien on, and security
interest in, all right, title and interest of the Loan Parties in such
Collateral and the proceeds thereof, as security for the Obligations (as
defined in the Guarantee and Collateral Agreement), in each case prior and
superior in right to any other Person (other than Persons holding
Permitted Liens or other encumbrances or rights permitted hereunder). 
Schedule 4.19(a)-2 lists each UCC Financing Statement that (i) names
any Loan Party as debtor and (ii) will remain on file after the Closing
Date.  Schedule 4.19(a)-3 lists each UCC Financing Statement
that (i) names any Loan Party as debtor and (ii) will be terminated
on or prior to the Closing Date; and on or prior to the Closing Date, the
Borrower will have delivered to the Administrative Agent, or caused to be
filed, duly completed UCC termination statements, authorized by the relevant
secured party, in respect of each UCC Financing Statement listed in Schedule
4.19(a)-3.

 

(b)   Each of the Mortgages, when filed (or which have been filed) in the
offices specified on Schedule 4.19(b), will be in form sufficient to create in
favor of the Administrative Agent, for the benefit of the Lenders, a legal,
valid and enforceable Lien on the Mortgaged Properties described therein and
proceeds thereof; and shall upon due filing constitute a  perfected Lien on, and security interest in,
all right, title and interest of the Loan Parties in the Mortgaged Properties
described therein and the proceeds thereof, as security for the Obligations (as
defined in the relevant Mortgage), in each case prior and superior in right to
any other Person (other than Persons holding Permitted Liens, including,
without limitation, First Priority Liens, or other encumbrances or rights
permitted hereunder or by the relevant Mortgage).

 

4.20.        Solvency.  Parent and its Subsidiaries
(taken as a whole) are, and after giving effect to the Transactions and the
incurrence of all Indebtedness and Obligations being incurred in connection
herewith and therewith will be Solvent.

 

4.21.        Regulation H. 
Except as set forth on Schedule 4.21, no Mortgage shall encumber improved
Real Property that is located in an area that has been identified by the
Secretary of Housing and Urban Development as an area having special flood
hazards and in

 

54

 

which flood insurance has
not been made available under the National Flood Insurance Act of 1968.

 

4.22.        Parks.  Set forth on Schedule 4.22 is a complete and correct list of all
of the amusement and attraction parks owned or leased, and currently operated
(the “Existing Parks”), by Parent or its Subsidiaries as of the Closing
Date.

 

SECTION 5.           CONDITIONS PRECEDENT

 

5.1.          Conditions
Precedent to Loans.  The agreement of each Lender to make the
Loans requested to be made by it hereunder is subject to the satisfaction,
prior to or concurrently with the making of the Loans on the Closing Date, of
the following conditions precedent:

 

(a)   Loan Documents.  The Administrative Agent shall have received (i) this
Agreement, executed and delivered by a duly authorized officer of Parent,
Holdings and the Borrower, (ii) the Guarantee and Collateral Agreement,
executed and delivered by a duly authorized officer of Parent, Holdings, the
Borrower and each Subsidiary Guarantor, (iii) Mortgages, executed and
delivered by a duly authorized officer of each party thereto, (iv) a
Lender Addendum, executed and delivered by a duly authorized officer of each
party thereto, (v) for the account of each relevant Lender that so
requests, Notes conforming to the requirements hereof and executed and
delivered by a duly authorized officer of the Borrower, and (vi) the
Intercreditor Agreement, executed and delivered by the Administrative Agent and
the First Lien Administrative Agent and acknowledged and agreed by Parent,
Holdings, the Borrower and the Subsidiary Guarantors.

 

(b)   Confirmation
Order.  The Bankruptcy Court shall
have entered an order confirming the Plan of Reorganization (the “Confirmation
Order”), which order (including the Plan of Reorganization) shall be in
full force and effect and shall not have been reversed or modified and shall
not be stayed or subject to a motion to stay or subject to appeal or petition
for review, rehearing or certiorari.  The
effective date under the Plan of Reorganization shall have occurred (and all conditions
precedent thereto as set forth therein shall have been satisfied (or shall be
concurrently satisfied) or waived).

 

(c)   New Time
Warner Facility.  Parent, Holdings,
the Borrower, the Acquisition Parties, certain of their affiliates and each
Subsidiary Guarantor shall have entered into definitive documentation
(including guarantees) with Time Warner in respect of the New Time Warner
Facility, which shall be in an amount equal to $150,000,000 and shall otherwise
be on terms and conditions substantially consistent with the drafts of (i) the
Multiple Draw Term Credit Agreement among the Acquisition Parties and TW and (ii) the
Guarantee Agreement among the Loan Parties and TW, in each case as filed with
the Bankruptcy Court on February 11, 2010 with any material change to any
term or condition set forth in such documents to be reasonably satisfactory to
the Administrative Agent.

 

(d)   Pro Forma Balance Sheet; Financial Statements.  The
Lenders shall have received (i) the Pro Forma Balance Sheet, (ii) the
audited consolidated financial statements

 

55

 

described in Section 4.1(b) and (iii) to
the extent available on the Closing Date, the financial statements described in
Section 6.1(a).

 

(e)   Approvals.  All material Governmental Authority and third
party approvals necessary or, in the reasonable discretion of the
Administrative Agent, advisable to be obtained by Holdings or any of its
Subsidiaries in connection with the transactions contemplated hereby shall have
been obtained and be in full force and effect.

 

(f)    Related Agreements.  The Administrative Agent shall have received
(in a form reasonably satisfactory to the Administrative Agent) true and
correct copies, certified as to authenticity by Parent or Holdings, of the
First Lien Credit Documents, the New Time Warner Facility, the Partnership
Parks Agreements, the Shared Services Agreement, the Tax Sharing Agreement and
such other documents or instruments as may be reasonably requested by the
Administrative Agent, including, without limitation, a copy of any other debt
instrument, security agreement or other material contract to which the Loan
Parties and Parent may be a party;  provided that any agreement,
document, instrument or contract posted on Intralinks, SyndTrak, DataSite or a
substantially similar electronic transmission (each, a “Platform”) will
be deemed to have been provided, and certified as to its authenticity, by
Parent and/or Holdings.

 

(g)   Payment of Existing Indebtedness; No Material Indebtedness.  The
Administrative Agent shall have received evidence satisfactory to the
Administrative Agent that (i) all amounts outstanding under the Existing
Credit Agreement and the Existing Time Warner Facility shall have been paid in
full in cash, all commitments relating to the foregoing shall have been
terminated and all liens and security interests related thereto shall have been
terminated or released and (ii) the outstanding principal and all accrued
and unpaid pre-petition interest of Six Flags Operations Inc. under its 12 1⁄4%
Notes due 2016 shall have been paid. 
After giving effect to the repayments and refinancing of Indebtedness of
the Loan Parties that shall occur on the Closing Date, the Loan Parties shall
have no material Indebtedness other than under the Loan Documents, the First
Lien Credit Documents, the New Time Warner Facility, the Partnership Parks
Agreements and certain existing Indebtedness (including certain existing
intercompany indebtedness) reasonably satisfactory to the Arranger.

 

(h)   Fees.  The Lenders, the Administrative Agent and the
Arranger shall have received all fees (including, without limitation, a ticking
fee, payable to the Administrative Agent for the benefit of each Lender which
has delivered an executed copy of its institutional allocation confirmation,
commencing on the date on which each such Lender shall have delivered a copy of
its institutional allocation confirmation, or other indication of its
commitment to the Facility satisfactory to the Arranger, and ending on the
earlier to occur of the date of termination or expiration of the Commitments
and the Closing Date, calculated at the rate of 0.50% per annum on the
aggregate amount of the Commitments) and the other fees set forth in that
certain Fee Letter, dated as of April 7, 2010, between Borrower and the Arranger required to be paid, and all
expenses for which invoices have been presented (including reasonable fees,
disbursements and other charges of counsel to the Agents), on or before the
Closing Date.  All such amounts will be
paid with cash on hand of Parent and its Subsidiaries or with proceeds of Loans
made on the Closing Date and will be reflected in the funding instructions
given by the Borrower to the Administrative Agent on or before the Closing
Date.

 

56

 

(i)    Business Plan.  The Lenders shall have received a
satisfactory business plan for fiscal years 2009 through 2015 (and the Borrower
shall have demonstrated projected minimum Liquidity of at least $60,000,000 at
all times under such business plan), including on a monthly basis through December 31,
2010, and a satisfactory written analysis of the business and prospects of
Parent and its Subsidiaries for the period from the Closing Date through 2015,
in each case covering such matters and in such level of detail as is customary
in comparable financing transactions.

 

(j)    Lien Searches.  The Administrative Agent shall have received
the results of recent Uniform Commercial Code and other lien searches in each
relevant domestic jurisdiction with respect to all Property of the Loan Parties
(except that with respect to the Real Property, such lien searches shall be
limited to the Mortgaged Properties), and such search shall reveal no Liens on
any of the Property of the Loan Parties, except for Permitted Liens or Liens to
be discharged prior to or at the Closing Date.

 

(k)   Closing Certificate.  The Administrative Agent shall have received
a certificate of each Loan Party, dated the Closing Date, substantially in the
form of Exhibit C, with appropriate insertions and attachments.

 

(l)    Legal Opinions.  The Administrative Agent shall have received
the following executed legal opinions:

 

(i)            the legal opinion
of Paul, Hastings, Janofsky & Walker LLP, special counsel to Parent, Holdings and its
Subsidiaries, substantially in the form of Exhibit F;

 

(ii)           the legal opinions
of counsel to Holdings and its Subsidiaries in Canada in respect of the pledge
of the Capital Stock of Subsidiaries of Holdings incorporated in Canada, in
form and substance reasonably satisfactory to the Administrative Agent;

 

(iii)          the legal opinions
of local counsel in each of the jurisdictions where a Mortgaged Property is
located, in form and substance reasonably satisfactory to the Administrative
Agent; and

 

(iv)          the legal opinions
of local counsel with respect to each Subsidiary Guarantor not covered in the
legal opinions referred to above in clauses (i) and (iii) of this Section 7.1(l),
in form and substance reasonably satisfactory to the Administrative Agent.

 

Each such legal opinion shall cover such
other matters incident to the transactions contemplated by this Agreement as
the Administrative Agent may reasonably require.

 

(m)  Pledged Stock; Stock Powers; Acknowledgment and Consent; Pledged Notes.  The
Administrative Agent shall have received (i) if certificated, the
certificates representing the Capital Stock pledged pursuant to the Guarantee
and Collateral Agreement, together with an undated stock power for each such
certificate executed in blank by a duly authorized officer of the pledgor thereof
(other than with respect to Reino Aventura, S.A. De C.V. and Ventas Y 

 

57

 

Servicios Al Consumidor, S.A. De C.V.), have
been received by the First Lien Administrative Agent or the Administrative
Agent, (ii) an Acknowledgment and Consent, substantially in the form of Annex
II to the Guarantee and Collateral Agreement, duly executed by any issuer
of Capital Stock pledged pursuant to the Guarantee and Collateral Agreement
that is not itself a party to the Guarantee and Collateral Agreement (other
than Reino Aventura, S.A. De C.V. and Ventas Y Servicios Al Consumidor, S.A. De
C.V.) and (iii) each promissory note, if any, pledged pursuant to the
Guarantee and Collateral Agreement endorsed (without recourse) in blank (or
accompanied by an executed transfer form in blank satisfactory to the
Administrative Agent) by the pledgor thereof has been received by the First
Lien Administrative Agent or the Administrative Agent.

 

(n)   Filings, Registrations and Recordings.  Each document (including,
without limitation, any Uniform Commercial Code financing
statement) required by the Security Documents or under any Requirement of
Law or reasonably requested by the Administrative Agent to be filed, registered
or recorded in order to create in favor of the Administrative Agent, for the
benefit of the Lenders, a perfected Lien on the Collateral described therein,
prior and superior in right to any other Person (other than with respect to
Liens expressly permitted by Section 7.4, including, without limitation,
the First Priority Liens), shall have been filed, registered or recorded or
shall have been delivered to the Administrative Agent in proper form for
filing, registration or recordation (other than with respect to Reino Aventura,
S.A. De C.V. and Ventas Y Servicios Al Consumidor, S.A. De C.V.).

 

(o)   Mortgages, etc.

 

(i)            The
Administrative Agent shall have received a Mortgage with respect to each
Mortgaged Property, executed and delivered by a duly authorized officer of each
party thereto.

 

(ii)           The
Borrower shall have ordered (or caused to be ordered) a Bock & Clark
Preliminary Evaluation Report for each Mortgaged Property and shall use good
faith efforts to cause Bock & Clark to deliver the Preliminary
Evaluation Reports.

 

(iii)          The
Administrative Agent shall have received, and the title insurance company
issuing the policies or binders referred to in clause (iv) below (the “Title
Insurance Company”) shall have received, existing surveys or maps of the
Parks and all portions of the Mortgaged Properties material to the Business
(the “Existing Surveys”).  If and
to the extent (A) a Mortgaged Property is not depicted by an Existing
Survey or (B) the Existing Survey for a Mortgaged Property does not depict
Real Property which is material to the operation of the Business thereon (such
Real Property not depicted by an Existing Survey referred to in the foregoing
clauses (A) and (B) being referred to as “Uncovered Property”),
then at the Administrative Agent’s request, made subject to and in accordance
with the terms hereof, the Administrative Agent and the Title Insurance Company
shall also have received an update to the applicable Existing Survey for the
applicable Mortgaged Property, or a supplemental survey (each, a “Supplemental
Survey”), depicting in each case, the Uncovered Property, which
Supplemental Survey shall (1) be certified to the Administrative Agent and
the Title Insurance Company by an independent professional licensed land
surveyor reasonably

 

58

 

satisfactory to the Administrative Agent in a
manner reasonably satisfactory to them, (2) show the perimeter boundaries
of the Uncovered Property and all improvements thereon located within 5 feet of
the perimeter boundary line of such Uncovered Property and all encroachments of
other property onto the Uncovered Property, (3) show all points of access
to such Uncovered Property from major public streets, and (4) include a
metes and bounds description of such Uncovered Property.  For purposes of this Section 5.1(o), the
Administrative Agent and the Title Insurance Company shall not be entitled to
receive a Supplemental Survey unless the Uncovered Property meets the following
“materiality threshold”: (i) the Uncovered Property is material to the
operation of the Business at the applicable Park as currently conducted, or (ii) the
Uncovered Property is required in order to operate the Business at the
applicable Park as currently conducted in accordance with Requirements of Law.

 

(iv)          The
Administrative Agent shall have received in respect of each Mortgaged Property
a mortgagee’s title insurance policy (or policies) or marked up unconditional
binder for such insurance, together with such endorsements as the
Administrative Agent shall reasonably request, in each case in form and
substance, and in an amount, reasonably satisfactory to the Administrative
Agent.  The Administrative Agent shall
have received evidence satisfactory to it that all premiums in respect of each
such policy and all related expenses, if any, have been paid.

 

(v)           The
Administrative Agent shall have received with respect to any Mortgaged Property
which is located in a “special flood hazard area” (A) a policy of flood
insurance that (1) covers such Mortgaged Property,  (2) is written in an amount not less
than the outstanding principal amount of the Indebtedness secured by such
Mortgage that is reasonably allocable to such real property or the maximum
limit of coverage made available with respect to the particular type of property
under the National Flood Insurance Act of 1968, whichever is less, and (3) has
a term ending not later than the maturity of the Indebtedness secured by such
Mortgage and (B) confirmation that the Borrower has received the notice
required pursuant to Section 208(e)(3) of Regulation H of the Board.

 

(vi)          The
Administrative Agent shall have received a copy of all recorded documents
referred to, or listed as exceptions to title in, the title policy or policies
referred to in clause (iii) above and a copy of all other material
documents affecting the Mortgaged Properties.

 

(p)   Insurance.  The Administrative Agent shall have received
insurance certificates satisfying the requirements of Section 6.4.

 

(q)   The U.S.A. PATRIOT Act.
 The Administrative Agent shall have received the documentation and other
information as required by bank regulatory authorities under applicable “know
your customer” and anti-money laundering rules and regulations, including
the U.S.A. PATRIOT Act.

 

(r)    Pro Forma
Compliance.  The Loan Parties shall
be in pro  forma compliance with the financial covenants set forth
in Sections 7.1 and 7.2.

 

59

 

(s)   First Lien
Term Loans.  The Borrower shall have
borrowed $770,000,000 in aggregate principal amount under the First Lien Credit
Agreement.

 

(t)    Equity
Proceeds.  Parent shall have received
(i) net proceeds in a minimum amount of $650,000,000 from the sale of new
Parent common stock (comprised of at least (A) $505,500,000 from the sale
of Parent common stock pursuant to a rights offering to Parent noteholders that
is fully backstopped by a group of Parent noteholders (the “Parent Backstop
Group”), (B) $75,000,000 from a direct discounted purchase of Parent
common stock by the Parent Backstop Group, (C) $50,000,000 from a direct
undiscounted purchase of Parent common stock by the Parent Backstop Group and (D) $19,500,000
from the conversion of claims in respect of the 12 1⁄4% Notes due 2016 of
Holdings (the “SFO Notes”)) and (ii) additional equity capital of
at least (A) $25,000,000 from the sale of additional common stock pursuant
to the Delayed Draw Equity Commitment under which at least $25,000,000 can be
raised from the sale of additional common stock if the board of directors of
Parent determines that such additional equity contribution is necessary between
the date on which the Confirmation Order becomes effective and June 1,
2011, and (B) $50,000,000 from the conversion of claims in respect of the
SFO Notes to fund the payment of post-petition interest in respect of the SFO
Notes if the Bankruptcy Court allows such claims; provided, however,
that in the case of clauses (i)(D) and (ii)(B) above, Parent may
receive cash in such amounts from such holders of claims (as opposed to and in
lieu of a conversion of claims).

 

(u)   Management,
etc.  The senior management of the
Loan Parties as of November 30, 2009 shall continue to be senior
management of Parent upon confirmation of the Plan of Reorganization and no
change of such senior management shall have been publicly announced.  The business plan for Parent, Holdings and
the Borrower on the Closing Date shall be consistent with that described in the
Plan of Reorganization.

 

(v)   Representations
and Warranties.  Each of the
representations and warranties made by any Loan Party in or pursuant to the
Loan Documents shall be true and correct in all material respects on and as of
the Closing Date, except to the extent such representations and warranties
expressly relate to an earlier date, in which case such representations and
warranties were true and correct in all material respects as of such earlier
date, provided, that, to the extent any such representation and warranty
is already qualified by materiality or by reference to material adverse effect,
such representation shall be true and correct in all respects.

 

(w)  No Default.  No Default or Event of Default shall have
occurred and be continuing on the Closing Date or after giving effect to the
making of the Loans.

 

SECTION 6.           AFFIRMATIVE COVENANTS

 

Parent, Holdings and the Borrower hereby
jointly and severally agree that, so long as any Loan or other amount is owing
to any Lender or any Agent hereunder, each of Parent, Holdings and the Borrower
shall and shall cause each of their respective Subsidiaries to:

 

6.1.          Financial Statements and Other Information. 
Deliver to the Administrative Agent for prompt distribution to each of
the Lenders:

 

60

 

(a)   as soon as available and in
any event within 90 days after the end of each fiscal year of Parent,
consolidated statements of operations, shareholders’ equity and cash flows of
Parent and its Subsidiaries for such fiscal year and the related consolidated
balance sheets of Parent and its Subsidiaries as at the end of such fiscal
year, setting forth in each case in comparative form the corresponding
consolidated figures for the preceding fiscal year, accompanied by an opinion
thereon of independent certified public accountants of recognized national
standing, which opinion shall state that such consolidated financial statements
present fairly in all material respects the consolidated financial condition
and results of operations of Parent and its Subsidiaries as at the end of, and
for, such fiscal year in accordance with GAAP (it being agreed that such
financial statements will be accompanied by a reconciliation statement to the
operations of Borrower and its Subsidiaries) and;

 

(b)   [Reserved];

 

(c)   as soon as available and in
any event within 90 days after the end of each fiscal year of each of Texas
Flags, Ltd. and Six Flags Over Georgia II, L.P., consolidated statements of
operations, partners’ equity and cash flows of each of Texas Flags, Ltd. and
Six Flags Over Georgia II, L.P. and its Subsidiaries for such fiscal year and
the related consolidated balance sheets of each of Texas Flags, Ltd. and Six
Flags Over Georgia II, L.P. and its Subsidiaries as at the end of such fiscal
year, setting forth in each case in comparative form the corresponding
consolidated figures for the preceding fiscal year, accompanied by an opinion
thereon of independent certified public accountants of recognized national
standing, which opinion shall state that such consolidated financial statements
present fairly in all material respects the consolidated financial condition
and results of operations of each of Texas Flags, Ltd. and Six Flags Over
Georgia II, L.P. and its Subsidiaries as at the end of, and for, such fiscal
year in accordance with GAAP;

 

(d)   as soon as available and in
any event within 45 days after the end of each of the first three quarterly
fiscal periods of each fiscal year of Parent, interim condensed consolidated
statements of operations, shareholders’ equity and cash flows of Parent and its
Subsidiaries for such period and for the period from the beginning of the
respective fiscal year to the end of such period, and the related consolidated
balance sheets of Parent and its Subsidiaries, as at the end of such period,
setting forth in each case in comparative form the corresponding consolidated
figures for the corresponding periods in the preceding fiscal year (except
that, in the case of balance sheets, such comparison shall be to the last day
of the prior fiscal year), accompanied by a reconciliation statement to the
operations of Borrower and its Subsidiaries and a certificate of a Responsible
Officer of Parent, which certificate shall state that such consolidated
financial statements present fairly in all material respects the interim
condensed consolidated financial condition and results of operations of Parent
and its Subsidiaries, in each case in accordance with GAAP, consistently
applied, as at the end of, and for, such period (subject to normal year-end
audit adjustments);

 

(e)   [Reserved];

 

61

 

(f)    concurrently with any
delivery of financial statements under clause (a) or (d) of this Section 6.1,
a certificate of a Responsible Officer of Parent, (i) to the effect that
no Default or Event of Default has occurred and is continuing (or, if any
Default or Event of Default has occurred and is continuing, describing the same
in reasonable detail and describing the action that being taken or proposed to
be taken with respect thereto), (ii) setting forth in reasonable detail
the computations necessary to determine whether the Loan Parties were in
compliance with Sections 7.1, 7.2, 7.3(n)(iii), 7.7 and 7.8(v) as of the
end of the respective quarterly fiscal period or fiscal year and (iii) setting
forth the aggregate Restricted Payments made pursuant to Section 7.6(c)(i) through
(iii), Section 7.6(e) and
Section 7.6(h) and including a description of such Restricted Payment
or Investment by category and aggregate Investments made pursuant to Section 7.8(g) during
the applicable quarterly fiscal period or fiscal year;

 

(g)   as soon as available, and in
any event no later than 75 days after the end of each fiscal year of Parent, a
detailed consolidated budget for the following fiscal year;

 

(h)   within 45 days after the end
of each of the first three fiscal quarters of Parent and within 90 days after
each fiscal year of Parent, a narrative discussion and analysis of the
financial condition and results of operations of Parent and its Subsidiaries
for such fiscal period and, if applicable, for the period from the beginning of
the then current fiscal year to the end of such fiscal quarter, as compared to
the comparable periods of the previous year;

 

(i)    promptly upon their
becoming available, copies of all registration statements and regular periodic
reports, if any, that Parent, Holdings or the Borrower shall have filed with
the Securities and Exchange Commission (or any governmental agency substituted
therefor) or any national securities exchange (other than amendments to any
registration statement (to the extent such registration statement, in the form
it became effective, is delivered), exhibits to any registration statement and,
if applicable, any registration statement on Form S-8);

 

(j)    promptly upon receipt
thereof, copies of any final management letters (other than special letters)
prepared by Parent’s independent public accountants with respect to the audit
of the financial statements of Parent and its Subsidiaries;

 

(k)   within 15 Business Days
after the end of each of the calendar months of June, July, August, September and
October, a performance report in respect of the Parks detailing on a
Park-by-Park basis attendance and revenue for the preceding calendar month and
showing a comparison to budget, to the same period in the prior year and
year-to-date in the prior year; and

 

(l)    from time to time such
other information regarding the financial condition, operations, business or
prospects of Parent or any of its Subsidiaries (including, without limitation,
any Plan or Multiemployer Plan and any reports or other information required to
be filed under ERISA), or compliance with the terms of this Agreement, as any
Lender or the Administrative Agent may reasonably request.

 

62

 

Notwithstanding the foregoing, the
obligations in paragraphs (a), (d) and (h) of this Section 6.1
may be satisfied with respect to financial information of Parent and its
Subsidiaries by furnishing Parent’s Form 10-K or 10-Q, as applicable, to
the extent filed with the SEC.

 

Documents required to be delivered pursuant
to Section 6.1(a), (d), (g), (h) or (i) may be delivered
electronically and if so delivered, shall be deemed to have been delivered on
the date (i) on which Parent posts such documents, or provides a link
thereto on Parent’s website on the Internet; or (ii) on which such
documents are posted on Parent’s or the Borrower’s behalf on a Platform; provided
that (i) upon written request by the Administrative Agent, Parent or the
Borrower shall deliver paper copies of such documents to the Administrative
Agent for further distribution to each Lender until a written request to cease
delivering paper copies is given by the Administrative Agent and (ii) Parent
or the Borrower shall notify (which may be by facsimile or electronic mail) the
Administrative Agent of the posting of any such documents and provide to the
Administrative Agent by electronic mail electronic versions (i.e., soft copies)
of such documents.  Notwithstanding
anything contained herein, in every instance the Borrower shall be required to
provide paper copies of the Compliance Certificates required by Section 6.1(f) to
the Administrative Agent.  Each Lender
shall be solely responsible for timely accessing posted documents or requesting
delivery of paper copies of such documents from the Administrative Agent and
maintaining its copies of such documents.

 

6.2.          Notices of Material Events. 
Furnish the following to the Administrative Agent in writing:

 

(a)   promptly after any executive
officer of Parent, Holdings or the Borrower has actual knowledge of facts that
would give him or her reason to believe that any Default or Event of Default
has occurred, notice of such Default or Event of Default;

 

(b)   as soon as any executive
officer of Parent, Holdings or the Borrower has actual knowledge of the facts
that would give him or her reason to know of the occurrence thereof, prompt
notice of all legal or arbitral proceedings, and of all proceedings by or
before any governmental or regulatory authority or agency, and of any material
development in respect of such legal or other proceedings, affecting Parent or
any of its Subsidiaries that, if adversely determined, could reasonably be
expected to result in aggregate liabilities or damages in excess of $5,000,000
over available insurance or indemnification by creditworthy third parties;

 

(c)   (i) as soon as
possible, and in any event within ten days after Parent, Holdings or the
Borrower knows or has reason to believe that any ERISA Event has occurred or
exists, notice of the occurrence of such ERISA Event (and as soon as
practicable thereafter, a copy of any report or notice required to be filed
with or given to the PBGC by Parent, Holdings or an ERISA Affiliate with
respect to such ERISA Event), if such ERISA Event could reasonably be expected
to result in aggregate liabilities in excess of $5,000,000 and (ii) promptly
following receipt thereof, copies of any documents described in Sections 101(k) or
101(l) of ERISA that Parent, Holdings or any ERISA Affiliate may request
with respect to any Multiemployer Plan; provided, that if Parent,
Holdings or any of the ERISA Affiliates have not requested such documents or
notices

 

63

 

from the administer or sponsor of the applicable Multiemployer Plan,
then, upon reasonable request of the Administrative Agent, Parent, Holdings
and/or its ERISA Affiliates shall promptly make a request for such documents or
notices from such administrator or sponsor and Parent shall provide copies of
such documents and notices to the Administrative Agent promptly after receipt
thereof and further  provided that the rights granted to the
Administrative Agent in this Section 6.2(c)(ii) shall be
exercised not more than once during a 12-month period;

 

(d)   as soon as possible, and in
any event within five days prior to the incurrence by Parent of Indebtedness
pursuant to any Indenture, notice of such incurrence;

 

(e)   prompt notice of the
assertion of any Environmental Claim by any Person against, or with respect to
the activities of, Parent or any of its Subsidiaries and notice of any alleged
violation of or non-compliance with any Environmental Laws or any Environmental
Permits other than any Environmental Claim or alleged violation that, if adversely
determined, could not (either individually or in the aggregate) reasonably be
expected to result in remediation costs of more than $5,000,000 over available
insurance or indemnification by creditworthy third parties or materially
adversely affect the operation of any Park; and

 

(f)    prompt notice of any other
development that results in, or could reasonably be expected to result in, a
Material Adverse Effect.

 

Each notice delivered under this Section 6.2
shall be accompanied by a statement of a Responsible Officer of Parent or the
Borrower setting forth in reasonable detail the facts and circumstances of the
event or development requiring such notice and any action taken or proposed to
be taken with respect thereto.

 

6.3.          Existence, Etc.

 

(a)   Preserve, renew and maintain in full force and effect its legal
existence under the laws of the jurisdiction of its organization (other than
with respect to Inactive Subsidiaries) and (b) take all reasonable action
to maintain all rights, privileges (including its good standing), permits,
licenses and franchises necessary or desirable in the normal conduct of its
business, except (i) in the case of clause (b) above, to the extent
that failure to do so could not reasonably be expected to have a Material
Adverse Effect or (ii) in the case of clause (a) or (b) above,
pursuant to a transaction permitted by Section 7.5;

 

(b)   pay and discharge all Federal income taxes and all other material
taxes, assessments and governmental charges or levies imposed on it or on its
income or profits or on any of its Property prior to the date on which
penalties attach thereto, except for any such obligation, tax, assessment,
charge or levy the payment of which is being contested in good faith and by
proper proceedings and against which adequate reserves are being maintained to
the extent required by GAAP; provided that, with respect to taxes
assessed against Real Properties, such taxes can be contested without payment
under applicable law;

 

(c)   maintain and preserve all of its Properties material to the conduct of
the Business of Parent, Holdings and its Subsidiaries (taken as a whole) in
good working order and

 

64

 

condition, except for failures that could not
reasonably be expected to result in a Material Adverse Effect;

 

(d)   keep adequate records and books of account, in which complete entries
will be made in accordance with GAAP consistently applied; and

 

(e)   permit representatives of any Lender or the Administrative Agent, upon
reasonable notice and during normal business hours (and, except if a Default
shall have occurred and be continuing, not more frequently than once each
calendar quarter), to examine, copy and make extracts from its books and
records, to visit and inspect any of its Properties, and to discuss its
business, finances, condition and affairs with its officers and independent
accountants and the park presidents of its Parks, all to the extent reasonably
requested by such Lender or the Administrative Agent (as the case may be); provided
that, excluding any such visits and inspections during the continuance of an
Event of Default, only the Administrative Agent on behalf of the Lenders may
exercise rights of the Administrative Agent and the Lenders under this Section 6.3(e).  The Administrative Agent and the Lenders
shall give Parent the opportunity to participate in any discussions with Parent’s
independent public accountants. 
Notwithstanding anything to the contrary in this Section 6.3(e),
none of Parent or any Subsidiary will be required to disclose, permit the
inspection, examination or making copies or abstracts of, or discussion of, any
document, information or other matter that (i) constitutes non-financial
trade secrets or non-financial proprietary information or (ii) in respect
of which disclosure to the Administrative Agent or any Lender (or their
respective representatives or contractors) is prohibited by law or any binding
agreement.

 

6.4.          Insurance.  Maintain with financially
sound and reputable insurance companies, insurance with respect to its
properties and business against loss or damage of the kinds customarily insured
against by Persons engaged in the same or similar business, of such types and
in such amounts (after giving effect to any self-insurance reasonable and
customary for similarly situated Persons engaged in the same or similar
businesses as Holdings and its Subsidiaries) as are customarily carried under
similar circumstances by such other Persons.

 

6.5.          Compliance with Contractual Obligations and
Requirements of Law.  Comply with Contractual Obligations and
Requirements of Laws, unless failure to comply with such Contractual
Obligations or Requirements of Law could not (either individually or in the
aggregate) reasonably be expected to have a Material Adverse Effect.

 

6.6.          Additional Collateral, Etc.  (a) With
respect to any personal Property acquired after the Closing Date by Parent,
Holdings, the Borrower or any of Parent’s Wholly Owned Subsidiaries (other than
(w) any personal Property described in paragraph (c) of this Section,
(x) any Property subject to a Lien expressly permitted by clauses 7.4(h), (k) and
(l), (y) any Property acquired by an Excluded Foreign Subsidiary and (z) any
Property acquired after the date hereof to the extent that the creation of a
security interest therein would be prohibited by a Contractual Obligation
binding on Parent, Holdings, the Borrower or any Subsidiary that is the owner
of such Property (including pursuant to the New Time Warner Facility or the
Partnership Parks Agreements), provided that such Contractual Obligation
existed at the time such Property was acquired and was not entered into in
anticipation of such acquisition) as to which the Administrative Agent, for the
benefit of the Lenders, does not have a perfected Lien, promptly,

 

65

 

and in any event on or
prior to 30 days after such acquisition (or such longer period as the
Administrative Agent may agree in its reasonable discretion) (i) execute
and deliver to the Administrative Agent such amendments to the Guarantee and
Collateral Agreement or such other documents as the Administrative Agent
reasonably deems necessary or advisable to grant to the Administrative Agent,
for the benefit of the Lenders, a security interest in such Property and (ii) take
all actions necessary or advisable to grant to the Administrative Agent, for
the benefit of the Lenders, a perfected Lien on such Property that is prior and
superior in right to any other Person (other than Persons holding
Permitted Liens or other encumbrances or rights permitted hereunder), including without limitation, the
filing of Uniform Commercial Code financing statements in such jurisdictions as
may be required by the Guarantee and Collateral Agreement or by law or as may
be reasonably requested by the Administrative Agent.

 

(b)   With respect to any fee interest in any Real Property having a value
(together with improvements thereof) of at least $10,000,000 acquired after the
Closing Date by Parent, Holdings, the Borrower or any of Parent’s Wholly Owned
Subsidiaries (other than any such Real Property owned by an Excluded Foreign
Subsidiary, Properties subject to the Great Escape Agreements, Properties
subject to the Partnership Parks Agreements or Properties subject to a Lien
expressly permitted by clauses (h), (i) and (j) of Section 7.4), promptly, and in any event on or prior
to 30 days after such acquisition (or such longer period as the Administrative
Agent may agree in its reasonable discretion) (i) execute and deliver a
Mortgage that is prior and superior in right to any other Person (other than
Persons holding Permitted Liens or other encumbrances or rights permitted
hereunder) in favor of the Administrative Agent, for the benefit of the
Lenders, covering such Real Property, (ii) if reasonably requested by the
Administrative Agent, provide the Administrative Agent with (x) mortgagee
title and extended coverage insurance insuring that the Lien of the Mortgage
upon such Real Property is prior and superior in right to any other
Person (other than Persons holding
Permitted Liens or other encumbrances or rights permitted hereunder) in an amount at least equal to the purchase
price of such Real Property (or such lesser amount as shall be reasonably
acceptable to the Administrative Agent) as well as a current or updated ALTA
survey thereof, certified to the Administrative Agent and (y) any consents
or estoppels reasonably deemed necessary or advisable by the Administrative
Agent in connection with such Mortgage, each of the foregoing in form and
substance reasonably satisfactory to the Administrative Agent (provided,
that Parent, Holdings, the Borrower and Parent’s Wholly Owned Subsidiaries
shall only be required to use commercially reasonable good faith efforts to
obtain such consents and estoppels) and (iii) if reasonably requested by
the Administrative Agent, deliver to the Administrative Agent legal opinions
relating to the matters described above, which opinions shall be in form and
substance, and from counsel, reasonably satisfactory to the Administrative
Agent.

 

(c)   With respect to any new Wholly Owned Subsidiary (other than an Excluded
Foreign Subsidiary or an Inactive Subsidiary) created or acquired after the
Closing Date (which, for the purposes of this paragraph, shall include any
existing Wholly Owned Subsidiary that ceases to be an Excluded Foreign
Subsidiary or an Inactive Subsidiary), by Parent or any of its Wholly Owned
Subsidiaries, promptly, and in any event on or prior to 30 days after such
creation or acquisition (or such longer period as the Administrative Agent may
agree in its reasonable discretion) (i) execute and deliver to the
Administrative Agent such amendments to the Guarantee and Collateral Agreement
as the Administrative Agent deems necessary or advisable to grant to the
Administrative Agent, for the benefit of the Lenders, a perfected Lien

 

66

 

that is prior and superior in
right to any other Person (other than Persons holding Permitted Liens or other encumbrances or
rights permitted hereunder) in
the Capital Stock of such new Wholly Owned Subsidiary that is owned by Parent
or any of its Wholly Owned Subsidiaries, (ii) deliver to the First Lien
Administrative Agent or the Administrative Agent the certificates representing
such Capital Stock, together with undated stock powers, in blank, executed and
delivered by a duly authorized officer of Parent or such Wholly Owned
Subsidiary, as the case may be, and (iii) with respect to any such new
Wholly Owned Subsidiary, cause such new Wholly Owned Subsidiary (A) to
become a party to the Guarantee and Collateral Agreement and (B) to take
such actions necessary or advisable to grant to the Administrative Agent for
the benefit of the Lenders a perfected Lien that is prior and superior
in right to any other Person (other
than Persons holding Permitted Liens or other encumbrances or rights permitted
hereunder) in the Collateral
described in the Guarantee and Collateral Agreement with respect to such new
Wholly Owned Subsidiary, including, without limitation, the filing of Uniform
Commercial Code financing statements in such jurisdictions as may be required
by the Guarantee and Collateral Agreement or by law or as may be reasonably
requested by the Administrative Agent, and (iv) if reasonably requested by
the Administrative Agent, deliver to the Administrative Agent legal opinions
relating to the matters described above, which opinions shall be in form and
substance, and from counsel, reasonably satisfactory to the Administrative
Agent.

 

(d)   With respect to any Wholly Owned Subsidiary or Partnership Park Entity
that ceases to be contractually prohibited (and, in the case of any Partnership
Park Entity, ceases to be subject to any Requirement of Law (including any
fiduciary or similar limitation applicable to the directors or managers
thereof) effectively prohibiting it) from becoming a Subsidiary Guarantor or
executing the Guarantee and Collateral Agreement or from having all or any
portion of its Capital Stock from being pledged under the Guarantee and
Collateral Agreement, promptly, and in any event on or prior to 30 days after
such Wholly Owned Subsidiary or Partnership Park Entity ceases to be prohibited
from being a Subsidiary Guarantor (or such longer period as the Administrative
Agent may agree in its reasonable discretion) (i) execute and deliver, or
cause to be executed and delivered, to the Administrative Agent such amendments
to the Guarantee and Collateral Agreement as the Administrative Agent deems
necessary or advisable to grant to the Administrative Agent, for the benefit of
the Lenders, a perfected Lien that is prior and superior in right to any
other Person (other than Persons
holding Permitted Liens or other encumbrances or rights permitted hereunder) in the Capital Stock of such Person that is
owned by Parent or any of its Wholly Owned Subsidiaries, (ii) deliver to
the First Lien Administrative Agent or the Administrative Agent the
certificates representing such Capital Stock, together with undated stock powers,
in blank, executed and delivered by a duly authorized officer of Parent or such
Wholly Owned Subsidiary, as the case may be, and (iii) if applicable,
cause such Person (A) to become a party to the Guarantee and Collateral
Agreement and (B) to take such actions necessary or advisable to grant to
the Administrative Agent for the benefit of the Lenders a perfected Lien
that is prior and superior in right to any other Person (other than Persons holding Permitted Liens or
other encumbrances or rights permitted hereunder) in the Collateral described in the Guarantee and Collateral Agreement
with respect to such new Wholly Owned Subsidiary, including, without
limitation, the filing of Uniform Commercial Code financing statements in such
jurisdictions as may be required by the Guarantee and Collateral Agreement or
by law or as may be reasonably requested by the Administrative Agent, and (iv) if
reasonably requested by the Administrative Agent, deliver to the Administrative
Agent legal

 

67

 

opinions relating to the matters described
above, which opinions shall be in form and substance, and from counsel,
reasonably satisfactory to the Administrative Agent.

 

(e)   With respect to any new Foreign Subsidiary created or acquired after
the Closing Date by Parent or any of its Wholly Owned Subsidiaries (other than
any Subsidiary of any Excluded Foreign Subsidiary), promptly, and in any event
on or prior to 30 days after such creation or acquisition (or such longer
period as the Administrative Agent may agree in its reasonable discretion) (i) execute
and deliver to the Administrative Agent such amendments to the Guarantee and
Collateral Agreement or such other documents as the Administrative Agent deems
necessary or advisable in order to grant to the Administrative Agent, for the
benefit of the Lenders, a perfected Lien that is prior and superior in
right to any other Person (other than
Persons holding Permitted Liens or other encumbrances or rights permitted
hereunder) in the Capital Stock
of such new Foreign Subsidiary that is owned by Parent or any of its Wholly
Owned Subsidiaries, provided that in no event shall more than 65% of the
total outstanding Capital Stock of any such new Foreign Subsidiary be required
to be so pledged, (ii) deliver to the First Lien Administrative Agent or
the Administrative Agent the certificates representing such Capital Stock,
together with undated stock powers, in blank, executed and delivered by a duly
authorized officer of Parent or such Wholly Owned Subsidiary, as the case may
be, and take such other action as may be necessary or, in the opinion of the
Administrative Agent, desirable to perfect the Lien of the Administrative Agent
thereon, and (iii) if reasonably requested by the Administrative Agent,
deliver to the Administrative Agent legal opinions relating to the matters
described above, which opinions shall be in form and substance, and from
counsel, reasonably satisfactory to the Administrative Agent.

 

(f)    Notwithstanding the provisions of this Section, (i) Parent shall
not be required to create, or to cause its Wholly Owned Subsidiaries to create,
a security interest in the Capital Stock of any Wholly Owned Subsidiary
acquired after the date hereof to the extent that the creation of such a security
interest would be prohibited by a Contractual Obligation binding on Parent or
the Wholly Owned Subsidiary that is the owner of such Capital Stock; provided,
that such Contractual Obligation either (x) was negotiated in good faith
in an arm’s length transaction with a Person that is not an Affiliate of Parent
or (y) existed at the time such Subsidiary was acquired and was not
entered into in anticipation of such acquisition and (ii) the Partnership
Parks Entities and their Property and any other Property of Parent and its
Subsidiaries subject to the Partnership Parks Agreements shall be expressly
excluded from, and shall not be subject to, any provisions of this Section 6.6 so long as the creation of a security
interest under, or the execution of, the Guarantee and Collateral Agreement is
prohibited by a Contractual Obligation binding on the Partnership Park Entities
or, with respect to any other Property of Parent and its Subsidiaries, is
prohibited by the Partnership Parks Agreements.

 

6.7.          Further Assurances.  From
time to time execute and deliver, or cause to be executed and delivered, such
additional instruments, certificates or documents, and take all such actions,
as the Administrative Agent may reasonably request for the purposes of
implementing or effectuating the provisions of this Agreement and the other
Loan Documents, or of more fully perfecting or renewing the rights of the
Administrative Agent and the Lenders with respect to the Collateral (or with
respect to any additions thereto or replacements or proceeds thereof or with
respect to any other Property or assets hereafter acquired by Parent or any
Subsidiary which may be deemed to be part of the Collateral) pursuant hereto or
thereto.  Upon the exercise by the

 

68

 

Administrative Agent or any
Lender of any power, right, privilege or remedy pursuant to this Agreement or
the other Loan Documents which requires any consent, approval, recording,
qualification or authorization of any Governmental Authority, Parent will, or
will cause the relevant Subsidiary to, execute and deliver, or will cause the
execution and delivery of, all applications, certifications, instruments and
other documents and papers that the Administrative Agent or such Lender may be
required to obtain from Parent or any of its Subsidiaries for such governmental
consent, approval, recording, qualification or authorization.

 

6.8.          Environmental Laws. 
Except to the extent that, in the aggregate, the failure to do so could
not reasonably be expected to have a Material Adverse Effect:  (a) comply with, and ensure compliance
by all tenants and subtenants, if any, with, all applicable Environmental Laws,
and obtain and comply with and maintain, and ensure that all tenants and
subtenants obtain and comply with and maintain, any and all Environmental
Permits, and (b) conduct and complete all investigations, studies,
sampling and testing, and all remedial, removal and other actions required
under Environmental Laws and promptly comply with all lawful orders and
directives of all Governmental Authorities regarding Environmental Laws.

 

6.9.          Ratings by S&P and Moody’s.  Use
commercially reasonable efforts (a) to cause a public corporate credit
rating and a facility rating (or the equivalents thereof) in respect of the
Facility to be issued by S&P and Moody’s within 90 days of the Closing Date
and to be maintained thereafter until the Maturity Date and (b) to assure
that each such rating is updated or confirmed at least once per year so long as
S&P and Moody’s are providing such yearly updates and confirmations in the
ordinary course.

 

SECTION 7.           NEGATIVE COVENANTS

 

Parent, Holdings and the Borrower hereby
jointly and severally agree that, so long as any Loan or other amount is owing
to any Lender or any Agent hereunder, Parent, Holdings and the Borrower shall
not, and shall not permit any of its Subsidiaries to, directly or indirectly:

 

7.1.          Senior Secured Leverage Ratio.  Permit the Senior Secured Leverage Ratio as at the last
day of any Measurement Period of the Borrower ending on or closest to the
applicable date set forth below to exceed the ratio set forth opposite such
date:

 

	
  Date

  	
   

  	
  Senior Secured Leverage
  Ratio

  
	
  September 30,
  2010

  	
   

  	
  7.50 to 1.00

  
	
  December 31,
  2010

  	
   

  	
  7.50 to 1.00

  
	
  March 31,
  2011

  	
   

  	
  7.25 to 1.00

  
	
  June 30,
  2011

  	
   

  	
  7.25 to 1.00

  
	
  September 30,
  2011

  	
   

  	
  7.25 to 1.00

  
	
  December 31,
  2011

  	
   

  	
  6.50 to 1.00

  
	
  March 31,
  2012

  	
   

  	
  6.50 to 1.00

  
	
  June 30,
  2012

  	
   

  	
  6.50 to 1.00

  
	
  September 30, 2012

  	
   

  	
  6.50 to 1.00

  
	
  December 31, 2012

  	
   

  	
  6.00 to 1.00

  
	
  March 31, 2013

  	
   

  	
  6.00 to 1.00

  
	
  June 30, 2013

  	
   

  	
  6.00 to 1.00

  
	
  September 30, 2013

  	
   

  	
  6.00 to 1.00

  
	
  December 31, 2013 and thereafter

  	
   

  	
  5.75 to 1.00

  

 

69

 

7.2.          Consolidated Interest Coverage Ratio.  Permit the
Consolidated Interest Coverage Ratio as at the last day of any Measurement
Period of the Borrower ending on or closest to the applicable date set forth
below to be less than the ratio set forth opposite such date:

 

	
  Date

  	
   

  	
  Consolidated Interest

  Coverage Ratio

  
	
  September 30, 2010

  	
   

  	
  1.75 to 1.00

  
	
  December 31, 2010

  	
   

  	
  1.75 to 1.00

  
	
  March 31, 2011

  	
   

  	
  1.75 to 1.00

  
	
  June 30, 2011

  	
   

  	
  1.75 to 1.00

  
	
  September 30, 2011

  	
   

  	
  1.75 to 1.00

  
	
  December 31, 2011

  	
   

  	
  2.00 to 1.00

  
	
  March 31, 2012

  	
   

  	
  2.00 to 1.00

  
	
  June 30, 2012

  	
   

  	
  2.00 to 1.00

  
	
  September 30, 2012

  	
   

  	
  2.00 to 1.00

  
	
  December 31, 2012

  	
   

  	
  2.25 to 1.00

  
	
  March 31, 2013

  	
   

  	
  2.25 to 1.00

  
	
  June 30, 2013

  	
   

  	
  2.25 to 1.00

  
	
  September 30, 2013

  	
   

  	
  2.25 to 1.00

  
	
  December 31, 2013

  	
   

  	
  2.25 to 1.00

  
	
  March 31, 2014 and thereafter

  	
   

  	
  2.25 to 1.00

  

 

provided that for the purpose of determining Consolidated
Interest Coverage Ratio for the fiscal quarters ending September 30, 2010,
December 31, 2010 and March 31, 2011, Consolidated Interest Expense
for the relevant period shall be deemed to equal Consolidated Interest Expense
for each such fiscal quarter (and, in the case of September 30, 2010, December 31,
2010 and March 31, 2011, each previous fiscal quarter commencing after the
Closing Date) multiplied by 4, 2 and 4/3, respectively.

 

7.3.          Indebtedness. 
Create, incur or suffer to exist any Indebtedness except:

 

(a)   Indebtedness of any
Loan Party pursuant to any Loan Document and any Indebtedness of such Loan
Party incurred to refinance, refund, replace or renew any such Indebtedness;

 

(b)   Indebtedness of any Person
outstanding on the date hereof and listed on Schedule 7.3(b), and any
Indebtedness of such Person incurred to refinance, refund, replace or renew any
such outstanding Indebtedness, provided that the principal amount (or
accreted value, if applicable) of such refinancing, refunding, replacement or
renewal of Indebtedness does not exceed the principal amount of Indebtedness
(or accreted value, 

 

70

 

if
applicable) being so refinanced, refunded, replaced or renewed plus all
interest capitalized in connection therewith, plus the Refinancing Expenses and
any costs and premiums associated with such refinancing, refunding, replacement
or renewal;

 

(c)   Indebtedness
under the New Time Warner Facility as in effect on the Closing Date and any
Indebtedness to Time Warner incurred to refinance, refund, replace or renew the
New Time Warner Facility; provided that (i) the terms and
conditions of the documentation evidencing the New Time Warner Facility,
taken as a whole, are not materially more restrictive to the Loan Parties party
thereto than the terms of this Agreement and the other Loan Documents, (ii) the
difference between (x) the principal amount of such Indebtedness and (y) the
sum of  the amount of the Indebtedness
being so refinanced plus all interest capitalized in connection therewith and
any Refinancing Expenses associated therewith shall be used to fulfill
obligations under the Partnership Parks Agreements to purchase limited
partnership units pursuant to the liquidity puts therein; (iii) the Guarantees
of such Indebtedness provided by the Borrower or any Subsidiary shall
not cover any increases in principal or any other liabilities or
obligations (other than increases in interest, yield or fees or other
modifications that are expressly permitted under this Section 7.3(c)) that
are not covered by such Guarantees on the Closing Date (it being understood and
agreed that the Guarantees shall be reduced by an amount equal to any principal
amount Guaranteed on the Closing Date and repaid on or after such date), unless
after giving pro  forma effect to the incurrence of such
Indebtedness the Senior Secured Leverage Ratio would not exceed 4.50 to
1.00 or the Consolidated Leverage Ratio of Parent would not exceed 5.75 to
1.00; (iv) any increases in the stated rate of interest,
aggregate yield and/or fees payable to the lenders thereunder
shall not collectively result in additional payments of interest, yield
and fees to be made in cash by the Loan Parties until after the scheduled
Maturity Date; and (v) none of the stated maturity dates in the
documentation for the New Time Warner Facility shall be shortened;

 

(d)   (i) Indebtedness of any
Loan Party to any other Loan Party and (ii) Guarantees by any Loan Party
of obligations of any other Loan Party; provided that any intercompany
Indebtedness incurred pursuant to clause (i) above shall, at the request
of the Administrative Agent, be evidenced by an intercompany note which shall
be pledged to the Administrative Agent as, and to the extent required by, the
Guarantee and Collateral Agreement substantially in the form of the
Intercompany Subordinated Note attached hereto as Exhibit N; provided,
further that the Indebtedness of Parent to Holdings, Borrower or any
Subsidiary of Borrower shall only be permitted to the extent such funds may be
distributed to Parent in compliance with Section 7.6;

 

(e)   Indebtedness of any
Non-Guarantor Subsidiary to Holdings or to any other Subsidiary of Holdings,
and Guarantees by Holdings or any Subsidiary of Indebtedness of any such Non-Guarantor
Subsidiary, in an aggregate amount outstanding for all such Indebtedness and
Guarantees (without duplication), together with the aggregate outstanding
amount of Investments in such Non-Guarantor Subsidiaries made as permitted by Section 7.8(v), not exceeding $57,500,000 at any one
time outstanding, provided that the aggregate amount of such Indebtedness of,
and such Guarantees of 

 

71

 

Indebtedness
of, and Investments made as permitted by Section 7.8(v) in, Foreign
Subsidiaries shall not exceed $57,500,000 at any one time outstanding;

 

(f)    Indebtedness of any
Non-Guarantor Subsidiary which is both a Wholly Owned Subsidiary and a Foreign
Subsidiary (a “Wholly Owned Non-Guarantor Foreign Subsidiary”) to any
other Wholly Owned Non-Guarantor Foreign Subsidiary, and Guarantees by any
Wholly Owned Non-Guarantor Foreign Subsidiary of obligations of any other
Wholly Owned Non-Guarantor Foreign Subsidiary;

 

(g)   (i) Indebtedness
consisting of Purchase Money Indebtedness (including, for the avoidance of
doubt, Indebtedness financing Investments permitted under Section 7.8 in
connection with Permitted Acquisitions) and Capital Lease Obligations incurred
after the date hereof in an aggregate principal amount not in excess of
$115,000,000 at any one time outstanding and (ii) any Indebtedness
incurred to refinance, refund, replace or renew the Indebtedness described in
the foregoing clause (i), provided that the principal amount (or
accreted value, if applicable) of such refinancing, refunding, replacement or
renewal of Indebtedness does not exceed the principal amount of the
Indebtedness (or accreted value, if applicable) being so refinanced, refunded,
replaced or renewed plus all interest capitalized in connection therewith and
the Refinancing Expenses;

 

(h)   (i) Indebtedness of any
Person outstanding on the date on which such Person becomes a Subsidiary of the
Borrower or is merged into or consolidated with or into the Borrower or any of
its Subsidiaries in an aggregate principal amount not in excess of $57,500,000
at any one time outstanding; provided, that (A) such Indebtedness
was not created in connection with, or in anticipation of, such acquisition and
(B) the amount of such Indebtedness is not increased thereafter unless
solely as a result of capitalization of interest or otherwise incurred under
another subsection of this Section 7.3 substantially contemporaneously with such merger or consolidation,
and (ii) any Indebtedness incurred to refinance the Indebtedness described
in the foregoing clause (i), provided that the principal amount (or
accreted value, if applicable) of such refinancing Indebtedness does not exceed
the principal amount of the Indebtedness being so refinanced plus capitalized
interest and any Refinancing Expenses associated therewith;

 

(i)    Indebtedness
under the First Lien Credit Documents, in an aggregate principal amount not to
exceed the Cap Amount at any time outstanding and any Indebtedness incurred to
refinance, refund, replace or renew such Indebtedness (or previous refinancing,
refunding, replacement or renewal thereof) (any such Indebtedness, “Permitted
First Lien Refinancing Indebtedness”); provided that (A) there are no direct or contingent obligors with respect
to such Indebtedness other than Persons that are obligors under the Loan
Documents, (B) such Indebtedness shall have a final maturity date equal to
or later than the final maturity date of the refinanced, refunded, replaced or
renewed Indebtedness and a weighted average life to maturity equal to or longer
than that of the refinanced Indebtedness, and (C) the terms and conditions
of any such Indebtedness, taken as a whole, are not materially less favorable
to the Lenders than the terms and conditions of the refinanced, refunded,
replaced or renewed Indebtedness and would be permitted for an amendment of the
First Lien Credit Agreement under Section 7.14.

 

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(j)    Indebtedness representing
deferred compensation to employees of Parent and its Subsidiaries incurred in
the ordinary course of business;

 

(k)   Indebtedness incurred by
Parent and its Subsidiaries in a Permitted Acquisition, any other Investment
expressly permitted hereunder or any Disposition, in each case to the extent
constituting (i) contingent liabilities in respect of any indemnification,
adjustment of purchase price, earn-out, non-compete, consulting, deferred
compensation and similar obligations of Parent and its Subsidiaries incurred in
connection therewith and (ii) obligations in respect of purchase price
adjustments or similar adjustments incurred by Parent or its Subsidiaries under
agreements governing Permitted Acquisitions, Investments permitted hereunder or
Dispositions;

 

(l)    Indebtedness consisting of (i) the
financing of insurance premiums or (ii) take-or-pay obligations contained
in supply arrangements, in each case, in the ordinary course of business;

 

(m)  obligations in respect of
performance, bid, appeal, stay, customs and surety bonds, performance and
completion guarantees, bank guarantees, bankers’ acceptances, including in
respect of self-insurance, workers compensation claims or other Indebtedness
with respect to reimbursement type obligations regarding workers compensation
claims, deferred compensation, severance, pension and health and welfare
retirement benefits or the equivalent thereof to current and former employees
of Parent and its Subsidiaries and similar obligations provided by Parent or
any of its Subsidiaries or obligations in respect of letters of credit related
thereto, in each case, in the ordinary course of business, existing on the
Closing Date or consistent with past practice;

 

(n)   (i) Indebtedness of the
Borrower or any of its Subsidiaries which are Loan Parties, to the extent that
the Net Cash Proceeds thereof are used to prepay the First Lien Tranche B Term
Loans or to purchase First Lien Tranche B Term Loans pursuant to a First Lien
Auction as set forth in Section 5.19 of the First Lien Credit Agreement, (ii) Guarantees
by the Borrower or any of its Subsidiaries of unsecured Indebtedness of Parent
or Holdings so long as with respect to this clause (ii) 100% (or, if the
Senior Secured Leverage Ratio is equal to or less than 4.50 to 1.00, 75%) of
the Net Cash Proceeds thereof are used to prepay the First Lien Tranche B Term
Loans or to purchase First Lien Tranche B Term Loans pursuant to a First Lien
Auction as set forth in Section 5.19 of the First Lien Credit Agreement, (iii) unsecured
Indebtedness of Parent or Holdings so long as with respect to this clause
(iii), (A) after giving pro  forma effect to the incurrence
of such Indebtedness and the use of the Net Cash Proceeds thereof the
Consolidated Leverage Ratio would not exceed 5.25 to 1.00 and (B) if after
giving pro  forma effect to the incurrence of such Indebtedness
and the use of the Net Cash Proceeds thereof the Senior Secured Leverage Ratio
would exceed 4.5 to 1.00, at least 25% of the Net Cash Proceeds thereof are
used to prepay the First Lien Tranche B Term Loans, and (iv) Indebtedness
of the Borrower or any of its Subsidiaries, to the extent that the Net Cash
Proceeds thereof are used to prepay the Loans or to purchase Loans pursuant to
an Auction as set forth in Section 3.18, provided that, in the case
of any Indebtedness incurred under either clause (i), (ii), (iii) or (iv) above,
(x) after giving effect to such Indebtedness and the use of the Net Cash
Proceeds thereof, the Loan Parties shall be in 

 

73

 

compliance
on a pro  forma basis with Sections 7.1 and 7.2, (y) any such
Indebtedness shall have a scheduled final maturity at least 180 days after the
Maturity Date and a weighted average life to maturity at least 180 days longer
than the First Lien Tranche B Term Loans and (z) the terms and conditions
of such Indebtedness, taken as a whole, shall not be materially more
restrictive on the Loan Parties than the terms and conditions contained herein;

 

(o)   other Indebtedness incurred
by Parent or any of its Subsidiaries in an amount not to exceed $23,000,000
outstanding at any time;

 

(p)   [Reserved];

 

(q)   cash management obligations
and other Indebtedness in respect of netting services, automatic clearinghouse
arrangements, employees credit or purchase cards, overdraft protections and
similar arrangements, in each case, in connection with deposit accounts;

 

(r)    Indebtedness of GP Holdings, Inc.,
SFT Holdings, Inc., Six Flags Over Texas, Inc., SFOG II, Inc.
and/or the Partnership Parks Entities owed to Parent or to any other
Subsidiary of Parent that constitute “affiliate loans” for purposes of
the Partnership Parks Agreements;

 

(s)   other Indebtedness of the
Partnership Parks Entities and any Guarantees of the obligations thereunder to
the extent such Guarantees are not provided by or recourse to a Loan Party; and

 

(t)    Guarantees incurred in the
ordinary course of business in respect of obligations to suppliers,
advertisers, licensees or similar Persons that are not for borrowed money.

 

For purposes of determining compliance with any
Dollar-denominated restriction on the incurrence of Indebtedness, the
Dollar-equivalent principal amount of Indebtedness denominated in a foreign
currency shall be calculated based on the relevant currency exchange rate in
effect on the date such Indebtedness was incurred, in the case of term debt, or
first committed, in the case of revolving credit debt; provided that if
such Indebtedness is incurred to extend, replace, refund, refinance, renew or
defease other Indebtedness denominated in a foreign currency, and such
extension, replacement, refunding, refinancing, renewal or defeasance would
cause the applicable Dollar-denominated restriction to be exceeded if
calculated at the relevant currency exchange rate in effect on the date of such
extension, replacement, refunding, refinancing, renewal or defeasance, such
Dollar-denominated restriction shall be deemed not to have been exceeded so
long as the principal amount of such refinancing Indebtedness does not exceed
the principal amount of such Indebtedness being extended, replaced, refunded,
refinanced, renewed or defeased.

 

7.4.          Liens.  Create, incur, assume or suffer to exist any
Lien upon any of its Property, whether now owned or hereafter acquired, except
the following (“Permitted Liens”):

 

(a)   Liens created pursuant to
the Security Documents;

 

74

 

(b)   Liens in existence on the
date hereof and listed on Schedule 7.4(b) and any extension, modification,
renewal or replacement thereof; provided that such extension,
modification, renewal or replacement does not increase the outstanding
principal amount of the Indebtedness secured thereby except by the amount of
the Refinancing Expenses associated therewith or to cover Indebtedness not
otherwise prohibited under Section 7.3; provided  further
that any such Lien does not extend to any additional Property other than
after-acquired Property that is affixed or incorporated into the Property
covered by such Lien and as otherwise permitted under Section 7.4 or financed
by Indebtedness permitted under Section 7.3;

 

(c)   Liens imposed by any
Governmental Authority for taxes, assessments and other charges or levies that
are (i) not yet due, (ii) being contested in good faith and by
appropriate proceedings if adequate reserves with respect thereto are
maintained on the books of Parent or the affected Subsidiaries, as the case may
be, to the extent required by GAAP or, in the case of any Foreign Subsidiary,
generally accepted accounting principles in effect from time to time in the
jurisdiction of organization of such Foreign Subsidiary or (iii) not
otherwise required to be paid under Section 6.3(b);

 

(d)   carriers’, warehousemen’s,
mechanics’, materialmen’s, repairmen’s, suppliers’, landlords’, brokers’ or
other like Liens arising in the ordinary course of business that are not
overdue for a period of more than 30 days (or if more than 30 days overdue, are
unfiled and no other action has been taken to enforce such Lien) or that are
being contested in good faith and by appropriate proceedings, and Liens
securing judgments but only to the extent for an amount and for a period not
resulting in an Event of Default under clause (j) of Section 8;

 

(e)   Liens (other than any Liens
imposed by ERISA or Code Section 412 or 430 or pursuant to any
Environmental Law) not securing Indebtedness or hedging obligations incurred or
deposits made in the ordinary course of business in connection with workers’
compensation, unemployment insurance and other types of social security
legislation and other similar obligations incurred in the ordinary course of
business;

 

(f)    Liens securing obligations
in respect of the performance of bids, trade contracts, governmental contracts
and leases (other than for Indebtedness for borrowed money including any
precautionary Uniform Commercial Code financing statements filed by a lessor
with respect to any equipment lease), statutory obligations, surety, stay,
customs and appeal bonds, performance bonds and other obligations of a like
nature (including those to secure health, safety and environmental obligations)
incurred in the ordinary course of business;

 

(g)   easements, rights-of-way,
restrictions and other similar encumbrances incurred in the ordinary course of
business and encumbrances consisting of zoning restrictions, easements,
licenses, restrictions on the use of Property or minor imperfections in title
thereto that, in the aggregate that do not interfere in any material respect
with the ordinary conduct of the business of Parent or any of its Subsidiaries;

 

75

 

(h)   Liens securing Purchase
Money Indebtedness or Capital Lease Obligations to the extent such Indebtedness
is permitted to be incurred under Section 7.3(g); provided, that
such Liens shall encumber only the Property that is the subject of such
Purchase Money Indebtedness or Capital Lease Obligations; provided that individual financings of equipment provided by one
lender may be cross-collateralized to other financings of equipment by such
lender;

 

(i)    Liens securing Indebtedness
to the extent such Indebtedness is permitted under Section 7.3(h); provided,
that such Liens shall encumber only the Property that is the subject of such
Indebtedness;

 

(j)    Liens pursuant to the Great
Escape Agreements or pursuant to leases, concessions and similar arrangements,
or other arrangements entered into in the ordinary course of business by
Holdings and its Subsidiaries that could not reasonably be expected to have a
Material Adverse Effect;

 

(k)   Liens
securing the First Lien Obligations;

 

(l)    Liens on any asset of a
Person existing at the time such Person becomes a Subsidiary of the Borrower or
is merged into or consolidated with or into the Borrower or any of its
Subsidiaries and not created in contemplation of such event;

 

(m)  leases, licenses, subleases
or sublicenses (including the provision of software under an open source
license) granted to others in the ordinary course of business which do not (i) interfere
in any material respect with the business of Holdings or any material
Subsidiary, taken as a whole, or (ii) secure any Indebtedness;

 

(n)   Liens in favor of customs
and revenue authorities arising as a matter of law to secure payment of customs
duties in connection with the importation of goods in the ordinary course of
business;

 

(o)   Liens (i) of a
collection bank arising under Section 4-210 of the Uniform Commercial Code
on the items in the course of collection, (ii) attaching to commodity
trading accounts or other commodities brokerage accounts incurred in the
ordinary course of business and (iii) in favor of a banking or other
financial institution arising as a matter of law encumbering deposits or other
funds maintained with a financial institution (including the right of set off)
and which are within the general parameters customary in the banking industry;

 

(p)   Liens (i) on cash
advances in favor of the seller of any property to be acquired in an Investment
permitted pursuant to Section 7.8 to be applied against the purchase price
for such Investment, (ii) consisting of an agreement to Dispose of any
property in a Disposition permitted under Section 7.5, in each case,
solely to the extent such Investment or Disposition, as the case may be, would
have been permitted on the date of the creation of such Lien, and (iii) on
securities that are the subject of repurchase agreements constituting Permitted
Investments;

 

76

 

(q)   (i) any interest or
title of a lessor under leases entered into by Holdings or any of its
Subsidiaries in the ordinary course of business and (ii) ground leases in
respect of Real Property on which facilities owned or leased by the Loan
Parties are located;

 

(r)    Liens that are contractual
rights of set-off (i) relating to the establishment of depository
relations with banks or other financial institutions not given in connection
with the issuance of Indebtedness, (ii) relating to pooled deposit or
sweep accounts of Parent or any of its Subsidiaries to permit satisfaction of
overdraft or similar obligations incurred in the ordinary course of business of
Parent and its Subsidiaries or (iii) relating to purchase orders and other
agreements entered into with customers of Parent or any of its Subsidiaries in
the ordinary course of business;

 

(s)   Liens arising out of
conditional sale, title retention, consignment or similar arrangements for sale
of goods entered into by the Borrower or any of the Subsidiaries in the
ordinary course of business;

 

(t)    Liens solely on any cash
earnest money deposits made by Holdings or any of the Subsidiaries in
connection with any letter of intent or purchase agreement permitted hereunder;

 

(u)   Liens arising from
precautionary Uniform Commercial Code financing statement filings;

 

(v)   other Liens securing
Indebtedness or other obligations in an aggregate principal amount at any time
outstanding not to exceed $11,500,000;

 

(w)  Liens securing Indebtedness
to the extent such Indebtedness is permitted under Sections 7.3(l) and (q);

 

(x)    pledges and deposits in the
ordinary course of business securing deductibles, self-insurance, co-payments
(or insurance of similar obligations) or liabilities for reimbursement
obligations of (including in respect of letters of credit or bank guarantees
for the benefit of), insurance carriers providing property, casualty or
liability insurance to any Loan Party;

 

(y)   Liens securing Indebtedness
permitted by Section 7.3(s); provided that such Lien shall not
encumber Property of any Loan Party; and

 

(z)    Liens pursuant to the
Partnership Parks Agreements or on limited partnership units owned by any of
the Partnership Parks Entities.

 

7.5.          Prohibition of Fundamental Changes.

 

(a)   Mergers.  Merge, dissolve, liquidate, consolidate with
or into another Person, or Dispose of (whether in one transaction or in a
series of transactions) all or substantially all of its assets (whether now
owned or hereafter acquired) to or in favor of any Person, except that:

 

77

 

(i)            Holdings or any
Subsidiary of the Borrower may merge with (A) the Borrower (including a
merger, the purpose of which is to reorganize the Borrower into a new
jurisdiction), provided that (x) the Borrower shall be the
continuing or surviving Person and (y) such merger does not result in the
Borrower ceasing to be incorporated under the laws of the United States, any
state thereof or the District of Columbia or (B) any one or more other
Subsidiaries of the Borrower, provided that when any Subsidiary that is
a Loan Party is merging with another Subsidiary of the Borrower, a Loan Party
shall be the continuing or surviving Person;

 

(ii)           (A) any
Subsidiary of Parent that is not a Loan Party may merge or consolidate with or
into any other Subsidiary of Parent; provided that if such Subsidiary is
a Loan Party, the Loan Party shall be the continuing or surviving Person and (B) any
Subsidiary of Parent may liquidate or dissolve or change its legal form if
Parent determines in good faith that such action is in the best interests of
Parent and its Subsidiaries and is not materially disadvantageous to the
Lenders;

 

(iii)          any Subsidiary
of the Borrower may Dispose of all or substantially all of its assets (upon
voluntary liquidation or otherwise) to the Borrower or another Subsidiary of
the Borrower; provided that if the transferor in such a transaction is a
Loan Party, then (A) the transferee must be a Loan Party or (B) to
the extent constituting an Investment, such Investment must be permitted
Indebtedness or a permitted Investment of a Subsidiary which is not a Loan
Party in accordance with Sections 7.3 and 7.8, respectively;

 

(iv)          so long as no
Default exists or would result therefrom, any Subsidiary of Parent may merge
with any other Person in order to effect an Investment permitted pursuant to Section 7.5(e) or
7.8; and

 

(v)           so long as no
Default exists or would result therefrom, a merger, dissolution, liquidation,
consolidation or Disposition, the purpose of which is to effect a Disposition
permitted pursuant to Section 7.5(c) shall be permitted.

 

(b)   Restrictions on Acquisitions.  Acquire all or substantially all of the
business or Property from, or all or substantially all of Capital Stock of, any
Person except for (i) purchases of inventory and other Property to be sold
or used in the ordinary course of business, (ii) Investments permitted
under Sections 7.5(e) and 7.8 and Dispositions permitted under Section 7.5(c)(iii),
(iii) Capital Expenditures (to the extent the making of such Capital
Expenditures will not result in a violation of any of the provisions of Section 7.7)
and (iv) acquisitions made with Qualified Net Cash Equity Proceeds and/or
with Qualified Capital Stock of the Parent.

 

(c)   Restrictions on Dispositions.  Consummate any Disposition other than (i) any
Disposition of any inventory or other Property Disposed of in the ordinary
course of business (including allowing any registrations or any applications
for registration of any immaterial intellectual property rights to lapse or go
abandoned in the ordinary course of business), (ii) sales of used,
obsolete or worn out equipment or other Property not used in the business of
Parent and its Subsidiaries, provided that (x) in the judgment of
Parent, the sale of such equipment or other Property will not result in more
than a nominal reduction in the Borrower Consolidated Adjusted 

 

78

 

EBITDA for the four fiscal quarters following
such sale from what it would otherwise have been and (y) to the extent the
Net Cash Proceeds from any sale or disposition effected under this clause (ii),
together with all other such sales under this clause (ii) in the same year
of Parent, exceed $20,000,000 such excess shall be deemed to be an “Asset Sale”
and subject to the provisions of Section 3.4(b) (subject to Section 3.10
and without giving effect to the $2,500,000 amount referred to in the
definition of “Asset Sale”), (iii) any Disposition of any Property to the
Borrower or one of their respective Wholly Owned Subsidiaries which is a
Subsidiary Guarantor, (iv) any Disposition of any Property to a
Non-Guarantor Subsidiary of the Borrower, provided that the book value
of the Property so Disposed of shall be deemed to constitute an Investment
under Section 7.8, (v) the sale (whether through a sale, swap or
exchange) of any timeshare in any of the campground parks or pursuant to the
Great Escape Agreements permitted under Section 7.5(e)(ii), (vi) the
sale of other Property having a fair market value not to exceed $28,750,000 in
the aggregate for any fiscal year of Parent, (vii) the sale of other
Property having a fair market value not to exceed $287,500,000 in the
aggregate, provided that with respect to all Dispositions permitted by
this clause (vii), (A) such Dispositions shall be made for at least fair
market value, as determined in good faith by the board of directors of Parent
or the Borrower, and for at least 75% cash or cash equivalent consideration, (B) the
requirements of Section 3.4(b) are complied with in connection
therewith (subject to Section 3.10) and (C) in connection with any
such Disposition as to which the fair market value of the related Property is
in excess of $17,250,000, the Borrower shall be in pro  forma
compliance with Section 7.1 and Section 7.2 (provided that in
determining such compliance, the Senior Secured Leverage Ratio shall be deemed
to be 0.25 to 1.00 lower than the otherwise applicable Senior Secured Leverage
Ratio), (viii) the sale of unused Real Property that is unimproved (except
for parking lots) and that is adjacent to a Park, provided that with
respect to all Dispositions permitted by this clause (viii), (A) such
Dispositions shall be made for at least fair market value as determined in good
faith by the board of directors of Parent or the Borrower, and for at least 75%
cash or cash equivalent consideration and (B) the requirements of Section 3.4(b) are
complied with in connection therewith (subject to Section 3.10)), (ix) Dispositions
permitted by Sections 7.3(g), 7.4, 7.5(a), 7.6 and 7.8, (x) Dispositions
in the ordinary course of business of Permitted Investments, (xi) leases,
subleases, licenses or sublicenses (including the provision of software under
an open source license), in each case in the ordinary course of business, which
do not materially interfere with the business of Parent and its Subsidiaries,
taken as a whole, (xii) Dispositions related to Recovery Events; provided
that with respect to all Dispositions permitted by this clause (xii) the
requirements of Section 3.4(b) are complied with in connection
therewith (subject to Section 3.10), (xiii) Dispositions of Investments in
joint ventures to the extent required by, or made pursuant to customary
buy/sell arrangements between, the joint venture parties set forth in joint
venture arrangements and similar binding arrangements, (xiv) Dispositions of
Property (other than Capital Stock of the Partnership Parks Entities) to the
extent that (A) such Property is exchanged for credit against the purchase
price of similar replacement Property or (B) the proceeds of such
Disposition are promptly applied to the purchase price of such replacement
property and (C) the fair market value of all Property disposed of
pursuant to this clause (xiv) does not exceed $11,500,000, (xv) Dispositions of
accounts receivables in connection with the collection or compromise thereof,
(xvi) Dispositions in the ordinary course of business consisting of the
abandonment of Intellectual Property rights, which in the reasonable good faith
determination of Parent or any of its Subsidiaries, are uneconomical,
negligible, obsolete or 

 

79

 

otherwise not material in the conduct of its
business, and (xvii) Dispositions of all or any portion of the Capital Stock or
the Property of KKI, LLC.

 

To the extent any Collateral is Disposed of as
expressly permitted by this Section 7.5 to any Person other than Parent or
any of its Subsidiaries, such Collateral shall be sold free and clear of the
Liens created by the Loan Documents, and, if requested by the Administrative
Agent, upon the certification by the Borrower that such Disposition is
permitted by this Agreement, the Administrative Agent shall be authorized to
take any actions deemed appropriate in order to effect the foregoing.

 

(d)   Sale and Leaseback.  Enter into any transaction pursuant to which
it shall convey, sell, transfer or otherwise dispose of any Property and, as
part of the same transaction or series of transactions, rent or lease as lessee
or similarly acquire the right to possession or use of, such Property, or other
Property which it intends to use for the same purpose or purposes as such
Property, to the extent such transaction gives rise to Indebtedness, unless any
Indebtedness arising in connection with such transaction shall be permitted
under Section 7.3(g).

 

(e)   Certain Permitted
Transactions. 
Notwithstanding the foregoing provisions of this Section 7.5:

 

(i)            Permitted
Acquisitions.  The
Borrower, any Subsidiary Guarantor or any Foreign Subsidiary may acquire all or
substantially all of the assets or business of, any Person, or of assets
constituting a business unit, a line of business or a division of, such Person
(whether by way of purchase of assets or stock, by merger or consolidation or
otherwise) after the date hereof (each, a “Permitted Acquisition”) so
long as:

 

(A)  the Loan Parties shall be in pro  forma
compliance with Sections 7.1 and 7.2 after giving effect to such Permitted
Acquisition (as if such Permitted Acquisition had been consummated on the first
day of such period), with the Senior Secured Leverage Ratio being deemed, for
this purpose, to be 0.25 to 1.00 times lower than that required under Section 7.1;
provided, however, that (x) any Indebtedness incurred or
repaid in connection with such Permitted Acquisition shall be deemed to have be
incurred or repaid, as the case may be, on such first day, and (y) Parent
shall have delivered to the Administrative Agent, at least five Business Days
prior to the date of any such Permitted Acquisition, a certificate of a
Responsible Officer of Parent setting forth computations in reasonable detail
demonstrating satisfaction of the foregoing conditions as at the date of such
certificate reflecting the terms of the transaction as of such date; provided
further that if prior to consummation of such Permitted Acquisition
changes are made to the terms that would alter the computations previously
delivered, Parent shall deliver a revised certificate demonstrating
satisfaction of the foregoing conditions on the date of the consummation of
such Permitted Acquisition;

 

(B)   such Permitted Acquisition (if by purchase of
assets, merger or consolidation) shall be effected in such manner so that the
acquired business, and the related assets, are owned either by the Borrower, a
Subsidiary Guarantor or a Foreign Subsidiary and, if effected by merger or
consolidation involving the Borrower, a Subsidiary Guarantor or a Foreign
Subsidiary, then the Borrower, such Subsidiary 

 

80

 

Guarantor or such Foreign Subsidiary shall be the continuing or
surviving entity and, if effected by merger or consolidation involving a Wholly
Owned Subsidiary of the Borrower, a Wholly Owned Subsidiary shall be the
continuing or surviving entity; provided, however, that with
respect to any Permitted Acquisition effected in such manner so that the
acquired business, and the related assets, are owned by a Foreign Subsidiary,
such acquired business, and the related assets, shall be located outside of the
United States of America;

 

(C)   the Borrower shall deliver to the Administrative
Agent (which shall promptly forward copies thereof to each Lender) (i) as
soon as possible and in any event no later than five days prior to the
consummation of each such Permitted Acquisition (or, if executed, such earlier
date as shall be five Business Days after the execution and delivery thereof),
the most recent drafts of the respective agreements or instruments pursuant to
which such Permitted Acquisition is to be consummated (including, without
limitation, any related management, non-compete, employment, option or other
material agreements), any schedules to such agreements or instruments and all
other material ancillary documents to be executed or delivered in connection
therewith and (ii) promptly following request therefor (but in any event
within three Business Days following such request), copies of such other
information or documents (including, without limitation, environmental risk
assessments) relating to such Permitted Acquisition as the Administrative Agent
or the Required Lenders shall have reasonably requested (and which is
available, or obtainable within such period by Parent with reasonable efforts);

 

(D)  to the extent applicable, the Borrower shall have
complied with the provisions of Section 6.6, including, without
limitation, to the extent not theretofore delivered, delivery to (x) the
First Lien Administrative Agent or the Administrative Agent of the certificates
evidencing 100% (or, in the case of any new Foreign Subsidiary the Capital
Stock of which is held by a Domestic Subsidiary, 65%) of the Capital Stock of
any new Subsidiary formed or acquired in connection with such Permitted
Acquisition, accompanied by undated stock powers executed in blank, and (y) the
Administrative Agent of the agreements, instruments, opinions of counsel and
other documents required under Section 6.6;

 

(E)   the aggregate Purchase Price for each such Permitted
Acquisition shall not exceed $287,500,000 or, at any time the Senior Secured
Leverage Ratio is less than 4.75 to 1.00 after giving effect to such Permitted
Acquisition and the incurrence of any related Indebtedness, $402,500,000, plus,
in each case, the Net Cash Proceeds received from the issuance of Capital Stock
of Parent and from the related contribution of cash to Holdings from Parent, in
each case as contributed to the Borrower, that are not otherwise expended
pursuant to Sections 7.7 or 7.8(i), plus the portion of any consideration paid
with Qualified Net Cash Equity Proceeds and/or in Qualified Capital Stock of
Parent; and

 

(F)   immediately prior to such Permitted Acquisition and
after giving effect thereto, no Default or Event of Default shall have occurred
and be continuing.

 

(ii)           Other
Dispositions.  The
Borrower or any of its Subsidiaries may Dispose of (whether through a sale,
swap or exchange) any timeshare or fractional interest in any 

 

81

 

of
the campground parks or any assets or interests pursuant to the Great Escape
Agreements.

 

7.6.          Restricted Payments.  Declare or make any Restricted Payment,
except that:

 

(a)   each Subsidiary of Parent
may make Restricted Payments to, or on behalf of or for the benefit of, Parent
to enable Parent to pay out-of-pocket accounting fees, legal fees and other
amounts incurred or owing by Parent in the ordinary course of business pursuant
to the Shared Services Agreement;

 

(b)   each Subsidiary of Parent
may make Restricted Payments to, or on behalf of or for the benefit of, Parent
in respect of (i) income tax liabilities of Parent and its Subsidiaries in
accordance with the Tax Sharing Agreement and (ii) value added tax,
franchise taxes and similar taxes to enable Parent to pay any such taxes
imposed on Parent on behalf or on account of its Subsidiaries;

 

(c)   so long as at the time
thereof and after giving effect thereto no Default or Event of Default shall
have occurred and be continuing, each of Holdings and the Borrower may make
Restricted Payments in cash to enable Parent and its Subsidiaries:

 

(i)            to pay obligations
of Parent or any of its Subsidiaries under the Partnership Parks Agreements to
the extent such obligations cannot be met with cash flow available to Parent
from the Partnership Parks Entities and other payment obligations of Parent or
any of its Subsidiaries thereunder and to pay any principal and interest
amounts due at maturity under the New Time Warner Facility to the extent such
payment obligations or such principal and interest amounts cannot be met with
cash flow available to Parent from the Partnership Park Entities and cannot be
funded under the New Time Warner Facility; and

 

(ii)           to purchase
limited partnership units under the Partnership Parks Agreements for an amount
in any fiscal year of Parent not to exceed the Liquidity Put Threshold Amount
for such fiscal year;

 

(iii)          to make Capital
Expenditures for the Partnership Parks Entities, provided that the
making of such Capital Expenditures does not violate Section 7.7;

 

(iv)          to finance any
Investment permitted to be made pursuant to Section 7.8; provided
that (A) such Restricted Payment shall be made substantially concurrently
with the closing or consummation of such Investment and (B) Parent shall,
immediately following the closing or consummation thereof, cause (1) all
property acquired (whether assets or equity interests) to be contributed to the
Borrower or a Loan Party (or a Person that will become a Loan Party upon
receipt of such  contribution) or (2) the
merger (to the extent permitted in Section 7.5(a)) of the
Person formed or acquired into the Borrower or a Loan Party in order to
consummate such Permitted Acquisition, in each case, in accordance with the
requirements of Section 6.6;

 

82

 

(v)           to make cash
payments in lieu of the issuance of fractional shares in connection with the
exercise of warrants, options or other securities convertible into or
exchangeable for equity interests of Parent; provided that any such cash
payment shall not be for the purpose of evading the limitations set forth in
this Section 7.6 (as determined in good faith by the board of directors or
the managing board, as the case may be, of Parent (or any authorized committee
thereof));

 

(vi)          to pay fees and
expenses (other than to Affiliates) related to any unsuccessful equity or debt
offering permitted by this Agreement not in excess of $2,300,000 in the
aggregate; and

 

(vii)         to pay fees,
costs and expenses related to the Transactions and the Related Transactions on
the Closing Date;

 

(d)   to the extent constituting
Restricted Payments, Parent and its Subsidiaries may enter into and consummate
transactions expressly permitted by any provision of Section 7.5, 7.8 or
7.10;

 

(e)   each of the Borrower and
Holdings may make other Restricted Payments (including (i) to enable
Parent or Holdings to pay principal payments permitted to be due, and interest
due, on Indebtedness of Parent or Holdings (excluding principal and interest
payments due at maturity under the New Time Warner Facility) and (ii) to
enable Parent to redeem warrants that may be issued as part of the Plan of
Reorganization); provided that for purposes of distributions under this
clause (e), (x) after giving effect to any such Restricted Payment and its
use no Default or Event of Default shall exist and the Loan Parties shall be in
pro  forma compliance with Sections 7.1 and 7.2 and (y) the
amount of all such other Restricted Payments in any fiscal year shall not
exceed (A) for the fiscal year ended December 31, 2010, the lesser of
(1) $11,500,000 and (2) the sum of $5,750,000 plus the
difference between the Liquidity Put Threshold Amount and the amount of
Restricted Payments made pursuant to Section 7.6(c)(ii) during
such fiscal year plus the Excess Cash Flow not applied to prepay First
Lien Tranche B Term Loans pursuant to Section 5.5(c) of the
First Lien Credit Agreement or Loans pursuant to Section 3.5(c), (B) for
the fiscal year ended December 31, 2011, the lesser of (1) $23,000,000
and (2) the sum of $11,500,000 plus the difference between the
Liquidity Put Threshold Amount and the amount of Restricted Payments made
pursuant to Section 7.6(c)(ii) during such
fiscal year plus the Excess Cash Flow not applied to prepay First Lien
Tranche B Term Loans pursuant to Section 3.5(c) or Section 5.5(c) of the
First Lien Credit Agreement, (C) for the fiscal year ended December 31,
2012, the lesser of (1) $34,500,000 and (2) the sum of $23,000,000 plus
the difference between the Liquidity Put Threshold Amount and the amount of
Restricted Payments made pursuant to Section 7.6(c)(ii) during
such fiscal year plus the Excess Cash Flow not applied to prepay First
Lien Tranche B Term Loans pursuant to Section 3.5(c) or Section 5.5(c) of the
First Lien Credit Agreement and (D) for any subsequent fiscal year,
$46,000,000;

 

(f)    Parent and its Subsidiaries
may make Restricted Payments in the form of noncash repurchases of Capital
Stock of Parent deemed to occur upon the exercise of stock options or warrants
if such repurchased Capital Stock represents all or a portion of 

 

83

 

the
exercise price of such options or warrants and cash payments in lieu of the
issuance of fractional shares in connection with the exercise of such stock
options or warrants;

 

(g)   Parent may (i) redeem
warrants that may be issued as part of the Plan of Reorganization to the extent
it receives a related Restricted Payment under clause (e) of this Section 7.6 and (ii) make
any other Restricted Payments required to be made in connection with the
Transactions;

 

(h)   Each of Holdings and the
Borrower may make Restricted Payments in cash to enable Parent, and Parent may
make Restricted Payments from RP Eligible Proceeds in an aggregate amount not
to exceed $300,000,000; provided that after giving pro forma effect to (i) each
Disposition which is the source of such RP Eligible Proceeds and (ii) the
corresponding Restricted Payment, (x) the Senior Secured Leverage
Ratio shall not exceed 4.50 to 1.00 (or in the case of RP Eligible Proceeds
in respect of a Disposition under 7.5(c)(vii), 4.00 to 1.00) and (y) the
Borrower shall have minimum Liquidity of at least $150,000,000;

 

(i)    Each of Holdings and the
Borrower may make Restricted Payments in cash in an aggregate amount not to
exceed $2,875,000 to enable Parent to repurchase, retire or acquire for value
equity interests of Parent from any future, present or former employee or
director of Parent or any of its Subsidiaries pursuant to any employee or
director equity plan, employee or director stock option plan or any other
employee or director benefit plan or any agreement (including any stock
subscription or shareholder agreement) with any employee or director of Parent
or any of its Subsidiaries; and

 

(j)    Each of Holdings and the
Borrower may make Restricted Payments in cash to enable Parent, and Parent may
make Restricted Payments to executives of Parent when restricted Capital Stock
of Parent vests (in lieu of payment of income tax by such executives).

 

Nothing herein shall be deemed to prohibit the
payment of Restricted Payments by (i) any Subsidiary of Holdings to
Holdings or the Borrower or to any other Wholly Owned Subsidiary of Holdings
which is a Subsidiary Guarantor, or by an Excluded Foreign Subsidiary to any
other Subsidiary of Holdings or (ii) any Subsidiary of Parent (other than
Holdings or any of its Subsidiaries) to Parent or to any other Subsidiary of
Parent or to prohibit any dividend payments or other distributions payable
solely in Capital Stock of such Person.

 

7.7.          Capital Expenditures.  Make or commit to make any Capital
Expenditure, except Capital Expenditures of Parent and its Subsidiaries not
exceeding the Base Capital Expenditure Amount during any fiscal year or period
of Parent; provided, that (i) the lesser of (x) any such
amount referred to above, if not so expended in the fiscal year or period for
which it is permitted and (y) 50% of the amount of the Base Capital
Expenditure Amount for such fiscal year may be carried over for expenditure in
the next succeeding fiscal year and (ii) Capital Expenditures made during
any fiscal year shall be deemed made, first, in respect of amounts carried over
from the prior fiscal year pursuant to subclause (i) above and, second, in
respect of amounts permitted for such fiscal year as provided above.  For purposes of the foregoing, the “Base
Capital Expenditure Amount” shall be an amount equal to $115,000,000 for
the fiscal year 

 

84

 

ending December 31,
2010 and an amount equal to $126,500,000 for any subsequent fiscal year plus,
in each case, with respect to each fiscal year in which an Acquisition is
consummated and the immediately following fiscal year, an amount for each such
fiscal year equal to 40% of the EBITDA of the Person so acquired for the four
fiscal quarters of such Person immediately preceding the date of such
Acquisition (it being understood and agreed that EBITDA shall be calculated as
set forth in the definition of “Parent Consolidated Adjusted EBITDA”) plus,
in each case, the Net Cash Proceeds received from the issuance of Capital Stock
of Parent and from the related contribution of cash to Holdings from Parent, in
each case as contributed to the Borrower, that are not otherwise expended
pursuant to Section 7.5(e) or
7.8(i).

 

7.8.          Investments. 
Make or permit to remain outstanding any Investments except:

 

(a)   Investments outstanding on
the date hereof and identified on Schedule 7.8(a);

 

(b)   operating deposit accounts
with banks;

 

(c)   Permitted Investments;

 

(d)   Investments consisting of
extensions of credit in the nature of accounts receivable or notes receivable
arising from the grant of trade credit in the ordinary course of business, and
Investments received in satisfaction or partial satisfaction thereof from
financially troubled account debtors and other credits to suppliers in the
ordinary course of business;

 

(e)   Investments consisting of (i) Indebtedness,
Liens, fundamental changes and Restricted Payments permitted under Sections 7.3
(other than Section 7.3(d) with respect to
Parent), 7.4, 7.5 and 7.6, respectively and (ii) Investments by the
Borrower or any of its Subsidiaries in rides, Intellectual Property assets and
related assets so long as the fair market value of the Property that is
invested does not exceed $115,000,000 in the aggregate, provided that in
the case of any Investment that would be a Capital Expenditure such Investment
shall be considered a Capital Expenditure for purposes of Section 7.7 and shall be
disregarded for purposes of this Section 7.8;

 

(f)    (i) Investments
(including debt obligations and Capital Stock) received in connection with the
bankruptcy or reorganization of any Person or in settlement of delinquent
obligations of, or other disputes with, any Person arising in the ordinary
course of business or upon the foreclosure with respect to any secured
Investment or other transfer of title with respect to any secured Investment, (ii) the
non-cash proceeds of any Disposition permitted by Section 7.5(c) and (iii) limited
partnership units purchased pursuant to the Partnership Parks Agreements;

 

(g)   (i) loans and advances
to Holdings, Parent or any Partnership Park Entity (or any direct or indirect
parent thereof) in lieu of, and not in excess of the amount of (after giving
effect to any other loans, advances or Restricted Payments in respect thereof),
Restricted Payments to the extent permitted to be made to Holdings or Parent in
accordance with Section 7.6 (with any such loan or advance to be deemed to
be a Restricted Payment for purposes of Section 7.6) and (ii) Investments
by Parent or any 

 

85

 

other
Subsidiary of Parent in GP Holdings, Inc., SFT Holdings, Inc., Six
Flags Over Texas, Inc., SFOG II, Inc. and/or the Partnership Parks Entities
that will be used to make or constitute “affiliate loans” for purposes of the
Partnership Parks Agreements;

 

(h)   advances of payroll payments
to employees in the ordinary course of business;

 

(i)    Investments to the extent
that payment for such Investments is made with Qualified Net Cash Equity
Proceeds or with the Net Cash Proceeds received (without duplication) from the
issuance of Capital Stock of Parent and from the contribution of cash to
Holdings from Parent, in each case as contributed to the Borrower and not
otherwise expended pursuant to Section 7.5(e) or
7.7 and/or Qualified Capital Stock of Parent;

 

(j)    Investments held by a
Subsidiary acquired after the Closing Date or of a corporation merged into the
Borrower or merged or consolidated with a Subsidiary of the Borrower in
accordance with Section 7.5 after the Closing Date to the extent that such
Investments were not made in contemplation of or in connection with such
acquisition, merger or consolidation and were in existence on the date of such
acquisition, merger or consolidation;

 

(k)   Investments by Parent or any
of its Subsidiaries in assets that were Permitted Investments when such
Investment was made;

 

(l)    (i) asset purchases
(including purchases of inventory, supplies and materials) and (ii) the
licensing or contribution of intellectual property pursuant to joint marketing
arrangements with other Persons, in each case in the ordinary course of
business;

 

(m)  Guarantees by Parent or any
of its Subsidiaries of leases (other than capitalized leases) or of other
obligations of Subsidiaries that do not constitute Indebtedness, in each case
entered into in the ordinary course of business;

 

(n)   Investments in joint
ventures pursuant to which, among other things, Parent or any of its
Subsidiaries is granted intellectual property rights for its Parks;

 

(o)   Investments constituting (i) contributions
to the equity of HWP whether directly or through the joint venture contemplated
by the Great Escape Agreements, (ii) contributions to such joint venture
as contemplated by the Great Escape Agreements and additional Investments
therein and (iii) Investments in a joint venture formed for the lease of
property and construction of a time share hotel to be located in Lake George,
New York; provided that the aggregate outstanding amount of all such
Investments permitted by this clause (o) shall not exceed $11,500,000;

 

(p)   Investments by Parent and
its Subsidiaries in Holdings and any Subsidiary of Holdings including
Guarantees by Parent or any of its Subsidiaries of obligations of Parent,
Holdings, the Borrower or any Subsidiary Guarantor; provided that with
respect to Non-Guarantor Subsidiaries, such Investments (together with
Indebtedness of any Non-Guarantor Subsidiaries permitted under Section 7.3(e)) may not
be in excess of the amount permitted under Section 7.3(e);

 

86

 

(q)   Investments by Foreign
Subsidiaries in Wholly Owned Subsidiaries which are Foreign Subsidiaries,
including Guarantees by Foreign Subsidiaries of obligations of other Wholly
Owned Subsidiaries which are Foreign Subsidiaries;

 

(r)    Hedging Agreements entered
into in the normal course of business and consistent with industry practice and
not for speculative purposes;

 

(s)   Investments received in
connection with any Disposition permitted under Section 7.5 or any
Disposition to which the Required Lenders shall have consented in accordance
with Section 10.1;

 

(t)    any Acquisition permitted by
Section 7.5(b) or 7.5(e);

 

(u)   Investments in an aggregate
amount of up to but not exceeding $115,000 during any fiscal year in 229 East
79th Street Associates L.P.;

 

(v)   additional Investments
(including Investments in any Non-Guarantor Subsidiaries of the Borrower and in
Dick Clark) up to but not exceeding the sum of (i) $86,250,000 and (ii) the
aggregate amount of Excess Cash Flow for completed fiscal years of the Borrower
since the Closing Date not applied or to be applied pursuant to Section 3.5(c) or
Section 5.5(c) of the First Lien Credit Agreement minus
the amount of Restricted Payments made pursuant to Sections 7.6(c) and
7.6(e); provided that the aggregate amount of Investments permitted by
this Section 7.8(v) shall not exceed $115,000,000 at any time
outstanding, provided, further that the aggregate amount of
Investments in Foreign Subsidiaries, together with the aggregate amount of
outstanding Indebtedness of and Guarantees of Indebtedness of Foreign
Subsidiaries permitted by Section 7.3(e) shall not exceed
$57,500,000 at any time outstanding; provided, still  further
that notwithstanding the foregoing, additional Investments under this clause (v) may
be made with amounts available under Section 7.8(i); and

 

(w)  loans or advances to
officers, directors, members of management, employees consultants and independent
contractors of Parent or any of its Subsidiaries (i) in an aggregate
amount (as to all such officers, directors, members of management, employees,
consultants and independent contractors) up to $1,150,000 at any one time
outstanding and (ii) in connection with such Person’s purchase of equity
interests of Parent in an aggregate amount not to exceed $1,150,000 at any time
outstanding, determined without regard to any write-downs or write-offs of such
loans or advances.

 

provided, that neither Parent nor any of its
Subsidiaries (other than a Partnership Park Entity) shall make any Investment
in any Partnership Park Entity, Holdings, Borrower or any Subsidiary of Parent
that is not a Subsidiary Guarantor other than pursuant to Section 7.8(g) and
7.8(e).

 

7.9.          Prepayment of Certain
Indebtedness.  Purchase, redeem, retire or otherwise acquire
for value, or set apart any money for a sinking, defeasance or other analogous
fund for the purchase, redemption, retirement or other acquisition of, or make
any voluntary payment or prepayment of the principal of or interest on, or any
other amount owing in respect of, or enter into any derivative transaction or
similar transaction obligating Holdings or any of its 

 

87

 

Subsidiaries to make payments to any other Person as a
result of a change in market value of, Indebtedness (other than Indebtedness
under the First Lien Credit Documents or Permitted First Lien Refinancing
Indebtedness) outstanding under any Indenture of Parent or Holdings (it being
understood that the following shall be permitted: (a) payments of
regularly scheduled principal and interest and mandatory prepayments of
Indebtedness of Parent and its Subsidiaries (including, without limitation, any
Permitted First Lien Refinancing Indebtedness and the New Time Warner Facility)
shall be permitted, (b) payments of the principal amount of Indebtedness
(or accreted value, if applicable) of Parent or Holdings shall be permitted,
with the Net Cash Proceeds of Indebtedness of Parent or Holdings, as the case
may be (to the extent such Indebtedness constitutes a refinancing, refunding,
replacement or renewal thereof plus all interest capitalized in connection
therewith, any Refinancing Expenses and any costs and premiums associated with
such refinancing, refunding, replacement or renewal) and is permitted pursuant
to Section 7.3, to the extent not required to prepay any Loans pursuant to
Section 3.4, (c) payments with respect to intercompany Indebtedness
permitted under this Agreement and owed to a Loan Party, (d) payments with
respect to intercompany Indebtedness permitted under this Agreement and owed to
Parent so long as immediately prior to and after giving effect thereto no
Default or Event of Default shall have occurred and be continuing (it being
agreed that in determining compliance with Section 7.6, any such payments
shall be deemed to constitute Restricted Payments), (e) payments with
respect to intercompany Indebtedness permitted under this Agreement and owed to
any Non-Guarantor Subsidiary so long as immediately prior to and after giving
effect thereto no Default or Event of Default shall have occurred and be
continuing, (f) payments of the principal amount of Indebtedness (or
accreted value, if applicable) of Parent or Holdings shall be permitted with
Qualified Capital Stock of Parent so long as such Qualified Capital Stock is
issued in contemplation of such repayment, and (g) payments of regularly
scheduled principal and interest of Indebtedness (or accreted value, if
applicable) incurred pursuant to Sections 7.3(g), (h) and (k) to the
extent that the assets securing such Indebtedness are Disposed of in compliance
with Section 7.5(c)).

 

7.10.        Transactions with Affiliates.  Enter into any transaction with any Affiliate
unless such transaction is upon fair and reasonable terms no less favorable to
Parent, Holdings, the Borrower or such Subsidiary, as the case may be, than it
would obtain in a comparable arm’s length transaction with a Person that is not
an Affiliate.  Notwithstanding the
foregoing, (i) any Affiliate who is an individual may serve as a director,
officer or employee of Parent or any of its Subsidiaries and such Person may
receive, and Parent and its Subsidiaries may engage in any transaction or series
of transactions related to, reasonable compensation, severance, indemnities and
reimbursement of reasonable expenses, including stock incentive and option
plans and agreements relating thereto, (ii) Parent and its Subsidiaries
may enter into transactions (other than extensions of credit by Parent or any
of its Subsidiaries to an Affiliate) providing for the leasing of Property, the
rendering or receipt of services or the purchase or sale of inventory and other
Property in the ordinary course of business if the monetary or business
consideration arising therefrom would be substantially as advantageous to
Parent and its Subsidiaries as the monetary or business consideration that
would obtain in a comparable transaction with a Person not an Affiliate, (iii) the
Borrower or any of its Subsidiaries may make an Acquisition of assets of any
Person which is an Affiliate solely by reason of such Person being controlled
by Parent or any of its Subsidiaries and may make Investments in such Person, provided
that such Acquisitions and Investments are (A) permitted under Section 7.5(e)(i) or
7.8 and (B) made upon fair and reasonable terms no less favorable to
Parent or such Subsidiary, as the case may be, than 

 

88

 

it would obtain in a
comparable arm’s length transaction with a Person that is not an Affiliate, (iv) Parent
or any of its Subsidiaries may enter into any transaction required of it
pursuant to (A) Section 7.8, (B) its
agreement with Dick Clark, or (C) the Great Escape Agreements, (v) Parent
and its Subsidiaries may be parties to and may perform their respective
obligations under the Shared Services Agreement and the Tax Sharing Agreement, (vi) Parent
or any of its Subsidiaries may perform their duties and obligations under the
Partnership Parks Agreements and (vii) Parent or any of its Subsidiaries
may enter into or consummate any transaction permitted for it by
Sections 7.3(b), 7.3(c), 7.3(d), 7.3(e), 7.3(f), 7.3(i), 7.3(j), 7.3(k),
7.3(n), 7.3(o), 7.3(r), 7.3(s), 7.4(j), 7.4(k), 7.4(l), 7.4(v), 7.5(a),
7.5(c)(iii), 7.5(c)(iv), 7.5(c)(v), 7.5(c)(ix), 7.5(c)(xi), 7.5(c)(xiv),
7.5(e)(ii), 7.6, 7.8(a), 7.8(e), 7.8(f), 7.8(g), 7.8(h), 7.8(i), 7.8(j),
7.8(k), 7.8(l), 7.8(m), 7.8(n), 7.8(o), 7.8(p), 7.8(q), 7.8(s), 7.8(t), 7.8(u),
7.8(v) or 7.8(w).

 

7.11.        Changes in Fiscal Periods.  Permit the fiscal year of Parent, Holdings or
the Borrower to end on a day other than December 31 or change Parent’s,
Holdings’ or the Borrower’s method of determining fiscal quarters.

 

7.12.        Certain Restrictions. Enter into,
after the date hereof, any indenture, agreement, instrument or other
arrangement that, directly or indirectly, prohibits or restrains, or has the
effect of prohibiting or restraining, or imposes materially adverse conditions
upon, the incurrence or payment of Indebtedness, the granting of Liens, the
declaration or payment of dividends, the making of loans, advances or
Investments or the sale, assignment, transfer or other disposition of Property,
other than any such prohibition or restraint (a) set forth in any
agreement providing for the disposition of Property (so long as such
prohibition or restraint relates only to the Property to be disposed of), (b) set
forth in any of the Loan Documents, the First Lien Credit Documents, any
Indenture (so long as such prohibition or restraint is not, in the good faith
judgment of Parent, more restrictive than those required for comparable
Indebtedness incurred by comparable entities), or any other document relating
to any existing Indebtedness or any Indebtedness referred to in Section 7.3(b),
7.3(c), 7.3(g), 7.3(h), 7.3(i), 7.3(n), 7.3(o) and 7.3(s) (and any
comparable prohibitions or restraints in any document governing any
Indebtedness incurred to refinance any of the foregoing, so long as such
prohibitions or restraints are, in the good faith judgment of Parent, no more
restrictive than those applicable to the Indebtedness being refinanced), (c) set
forth in any Real Property lease agreement, licenses, joint venture agreements,
contracts entered into in the ordinary course of business to the extent that
such prohibition or restraint relates only to the Property which is the subject
of such instrument and could not reasonably be expected to result in a Material
Adverse Effect, (d) set forth in any instrument relating to a Permitted
Lien, so long as such prohibitions or restraints relate only to the Property
encumbered by such Permitted Lien and (e) set forth in any Contractual
Obligation with respect to (i) negative pledges and restrictions on Liens
in favor of any holder of Indebtedness permitted under Section 7.3(g), 7.3(h) and
7.3(s) but solely to the extent any negative pledge relates to the
property financed by or the subject of such Indebtedness, (ii) customary
provisions restricting subletting or assignment of any lease governing a
leasehold interest, and (iii) customary provisions restricting assignment
or transfer of any agreement entered into in the ordinary course of business.

 

7.13.        Lines of Business.  Engage to any substantial extent in any line
or lines of business activity other than the business of owning and operating
amusement and attraction 

 

89

 

parks, and businesses
related, ancillary or complementary thereto and the businesses and activities
related thereto more fully described on Schedule 7.13 attached hereto.

 

7.14.        Modifications of Certain
Documents.  Consent to
any modification, supplement or waiver of:

 

(a)   any provision of the New
Time Warner Facility, the effect of which would
be materially adverse to the Lenders;

 

(b)   its articles of
incorporation or by-laws (or similar constituent documents) in any manner
adverse, in any material respect, to the Lenders;

 

(c)   any provision of the
Partnership Parks Agreements, the Great Escape Agreements, the Tax Sharing
Agreement or any agreement relating to any Permitted Acquisition or any lease
of Real Property with respect to any Park if such modification, supplement or
waiver would have a Material Adverse Effect;

 

(d)   any provision of the First
Lien Credit Documents to the extent prohibited by the Intercreditor Agreement;
or

 

(e)   any provision of the First
Lien Credit Agreement or any Permitted First Lien Refinancing Indebtedness (i) to
increase any applicable margin thereunder (or impose a fee in lieu thereof) by
more than 2.0% per annum or (ii) to extend the scheduled maturity of the
First Lien Obligations or any Permitted First Lien Refinancing Indebtedness
beyond September 30, 2016.

 

7.15.        Limitation on
Activities of Parent and Holdings.  (a)  In
the case of Holdings, conduct, transact or otherwise engage in any business or
operations other than those incidental to (i) its ownership of the Capital
Stock of the Borrower and PP Data Services Inc., (ii) the maintenance of
its legal existence (including the ability to incur fees, costs and expenses
relating to such maintenance), (iii) the performance of its obligations in
the Loan Documents, the First Lien Credit Documents, the Partnership Parks
Agreements and the New Time Warner Facility, or (iv) not otherwise
prohibited by the Loan Documents; provided that, notwithstanding
anything herein to the contrary, Holdings may not (1) make any
Acquisitions (except as expressly contemplated in Section 7.5(b)(ii) in connection with
Investments permitted by clause (2) below only), (2) make any
Investments except as expressly contemplated by Sections 7.8(a), (b), (c),
(e)(i), (g), (h), (k), (m), (n), (o), (p), (r) (in connection with
Indebtedness permitted under Section 7.3(n)(iii) only), (s), (t) (with respect to Section 7.5(b)(ii) in connection with
Investments permitted by this clause (2) only), (u) and (w), (3) create
any Subsidiaries that are not Subsidiaries of Borrower or any of its
Subsidiaries or (4) own any operating entity other than Borrower or act as
an operating entity.

 

(b) 
In the case of Parent, conduct,
transact or otherwise engage in any business other than those incidental to (i) its
ownership of the Capital Stock of its Subsidiaries and the parks subject to the
Partnership Parks Agreements, (ii) the maintenance of its legal existence
(including the ability to incur fees, costs and expenses relating to such
maintenance), (iii) its status as a publicly traded company or public
filer or as a member of the consolidated group of Parent and its Subsidiaries
(including the ability to participate in tax, accounting and other 

 

90

 

administrative matters or comply with laws relating
thereto), (iv) the performance of its obligations in the Loan Documents,
the First Lien Loan Documents, the Partnership Parks Agreements and the New
Time Warner Facility, (v) any
public offering or other issuance of its Capital Stock or (vi) not
otherwise prohibited by the Loan Documents; provided that, notwithstanding
anything herein to the contrary, Parent may not (1) make any Acquisitions
(except as expressly contemplated by Sections 7.5(b)(ii) in connection
with Investments permitted by clause (2) below only, 7.5(b)(iii) in
connection with the Partnership Park Entities only and 7.5(b)(iv)), (2) make
any Investments except as expressly contemplated by Sections 7.8(a), (b), (c),
(d), (e)(i), (f)(i), (g), (h), (i), (k), (l)(ii), (m), (n), (p), (r) (in
connection with Indebtedness permitted under Section 7.3(n)(iii) only), (s), (t) (with
respect to Sections 7.5(b)(ii) in connection with Investments permitted by
this clause (2) only, 7.5(b)(iii) in connection with the Partnership
Park Entities only and 7.5(b)(iv) only) and (w), (3) create any
Subsidiaries that are not either Subsidiaries of the Borrower or the
Partnership Parks Entities or (4) own any operating entity other than the
Borrower and its Subsidiaries and the Partnership Parks Entities or act as an
operating entity (provided that nothing in this Section 7.15(b) shall
limit the ability of Parent to enter into sponsorship agreements, licensing
agreements, management agreements, supply agreements or other similar
agreements in the ordinary course of business).

 

7.16.        Limitation on Hedging
Agreements.  Enter into
any Hedging Agreement other than Hedging Agreements entered into for the
purpose of mitigating risks to which Parent and its Subsidiaries have actual
exposure and not for speculative purposes, in respect of interest rates or
foreign exchange rates; provided, that Parent and its Subsidiaries will
not enter into any Hedging Agreement providing for payment by Parent or any
Subsidiary of amounts based upon a floating interest rate in exchange for
receipt by Parent or any Subsidiary of amounts based upon a fixed interest rate
(each, a “Fixed-to-Floating Swap”) if, on the date of such Hedging
Agreement and after giving effect thereto, the sum of (i) the aggregate
notional principal amount covered by all such Fixed-to-Floating Swaps plus (ii) the
aggregate principal amount of all then outstanding consolidated Indebtedness of
Parent and its Subsidiaries (determined without duplication in accordance with
GAAP) that as of such date bears interest at a floating rate (and is not
effectively bearing interest at a fixed rate through a Hedging Agreement) would
exceed 50% of then outstanding consolidated Indebtedness of Parent and its
Subsidiaries (determined in accordance with GAAP).

 

SECTION 8.           EVENTS OF DEFAULT

 

If any of the following events shall occur and be continuing:

 

(a)   the Borrower shall default
in the payment when due in accordance with the terms hereof of any principal of
any Loan, or shall default for five or more Business Days in the payment when
due of any interest on any Loan or any fee or any other amount payable by it
hereunder or under any other Loan Document;

 

(b)   any representation, warranty
or certification made or deemed made herein or in any other Loan Document (or
in any modification or supplement hereto or thereto) by Parent or any Loan
Party, or any certificate furnished to any Lender or the Administrative Agent
pursuant to the provisions hereof or thereof, shall prove to have been false or

 

91

 

misleading
as of the time made or furnished in any material respect, in any such case that
could reasonably be expected to (either individually or in the aggregate)
materially adversely affect the operations of any material Park or have a
Material Adverse Effect;

 

(c)   (i) Parent, Holdings or
the Borrower shall default in the performance of any of its obligations under
any of Section 6.2(a), Section 6.6 or Section 7 of this
Agreement, and such default shall continue unremedied for a period of 30 days
or (ii) an “Event of Default” under and as defined in any Mortgage shall
have occurred and be continuing;

 

(d)   any Loan Party shall fail to
observe or perform any covenant, condition or agreement contained in this
Agreement (other than those specified in clause (a), (b) or (c) of
this Section 8) or any other Loan Document and such failure shall continue
unremedied for a period of 30 days after notice thereof to the Borrower by the
Administrative Agent or any Lender (through the Administrative Agent);

 

(e)   any Loan Party shall default
in the payment when due of any principal of or interest on any of its
Indebtedness aggregating $28,750,000 or more or any Loan Party shall default in
the payment when due of any amount aggregating $28,750,000 or more under any
Hedging Agreement (in each case after the expiration of all applicable grace
periods);

 

(f)    (i) any event specified
in any note, agreement, indenture or other document evidencing or relating to
any Indebtedness (other than the First Lien Obligations and the Indebtedness
under the Loan Documents) aggregating $28,750,000 or more of any Loan Party
shall occur if the effect of such event is to cause, or (with the giving of any
notice or the lapse of time or both) to permit the holder or holders of such
Indebtedness (or a trustee or agent on behalf of such holder or holders) to
cause, such Indebtedness to become due, or to be prepaid in full (whether by
redemption, purchase, offer to purchase or otherwise), prior to its stated
maturity or any event specified in any Hedging Agreement shall occur if the
effect of such event is to cause, or (with the giving of any notice or the
lapse of time or both) to permit, termination or liquidation payment or
payments aggregating $28,750,000 or more to become due, provided that this
clause shall not apply to secured Indebtedness that becomes due as a result of
the voluntary sale or transfer of Property securing such Indebtedness, if such
sale or transfer is permitted hereunder and under the documents providing for
such Indebtedness; provided further that such failure is unremedied and is not
waived by the holders of such Indebtedness; or (ii) (x) there shall
occur an “Event of Default” (under and as defined in the First Lien Credit
Agreement) and such “Event of Default” (under and as defined in the First Lien
Credit Agreement) shall remain uncured and unwaived for a period in excess of
90 days (other than with respect to an “Event of Default” due to failure to
make any payment under the First Lien Credit Agreement or an acceleration under
the First Lien Credit Agreement); or (y) there shall occur an “Event of
Default” due to failure to make any payment under the First Lien Credit
Agreement or an acceleration under the First Lien Credit Agreement;

 

(g)   a proceeding or case shall
be commenced, without the application or consent of Parent, Holdings, the
Borrower or any Subsidiary, in any court of competent 

 

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jurisdiction,
seeking (i) its reorganization, liquidation, dissolution, arrangement or
winding-up, or the composition or readjustment of its debts, (ii) the
appointment of a receiver, custodian, trustee, examiner, liquidator or the like
of Parent, Holdings, the Borrower or such Subsidiary or of all or any
substantial part of its Property, or (iii) similar relief in respect of
Parent, Holdings, the Borrower or such Subsidiary under any law relating to
bankruptcy, insolvency, reorganization, winding-up, or composition or
adjustment of debts, and such proceeding or case shall continue undismissed, or
an order, judgment or decree approving or ordering any of the foregoing shall
be entered and continue unstayed and in effect, for a period of 60 or more
days; or an order for relief against Parent, Holdings, the Borrower or any
Subsidiary shall be entered in an involuntary case under the Bankruptcy Code or
any other applicable bankruptcy, insolvency or similar laws;

 

(h)   Parent, Holdings, the
Borrower or any Subsidiary shall (i) apply for or consent to the
appointment of, or the taking of possession by, a receiver, custodian, trustee,
examiner or liquidator of itself or of all or a substantial part of its
Property, (ii) make a general assignment for the benefit of its creditors,
(iii) commence a voluntary case under the Bankruptcy Code or any other
applicable bankruptcy, insolvency or similar laws, (iv) file a petition
seeking to take advantage of any other law relating to bankruptcy, insolvency,
reorganization, liquidation, dissolution, arrangement or winding-up, or
composition or readjustment of debts, (v) fail to controvert in a timely
and appropriate manner, or acquiesce in writing to, any petition filed against
it in an involuntary case under the Bankruptcy Code or any other applicable
bankruptcy, insolvency or similar laws or take any corporate action for the
purpose of effecting any of the foregoing;

 

(i)    Parent, Holdings, the
Borrower or any Subsidiary shall admit in writing its inability to, or be
generally unable to, pay its debts as such debts become due;

 

(j)    a final judgment or
judgments for the payment of money of $28,750,000 or more in the aggregate
(exclusive of judgment amounts to the extent covered by insurance or
indemnification of creditworthy third parties) shall be rendered by one or more
courts, administrative tribunals or other bodies having jurisdiction against
Parent, Holdings, the Borrower or any Subsidiary and the same shall not be
discharged (or provision shall not be made for such discharge), or a stay of
execution thereof shall not be procured, within 60 days from the date of entry
thereof, and Parent, Holdings, the Borrower or the relevant Subsidiary shall
not, within such period of 60 days, or such longer period during which
execution of the same shall have been stayed, appeal therefrom and cause the
execution thereof to be stayed during such appeal;

 

(k)   (i) an ERISA Event shall
have occurred, (ii) a trustee shall be appointed by a United States
district court to administer any Plan; (iii) the PBGC shall institute
proceedings to terminate any Plan or Plans, (iv) Parent, Holdings, the
Borrower, any Subsidiary or any ERISA Affiliate shall have been notified by the
sponsor of a Multiemployer Plan that it has incurred or will be assessed
Withdrawal Liability to such Multiemployer Plan and such entity does not have
reasonable grounds for contesting such Withdrawal Liability or is not
contesting such Withdrawal Liability in a timely and appropriate manner, or (v) Parent,
Holdings, the Borrower, any Subsidiary or any ERISA 

 

93

 

Affiliate
shall engage in any “prohibited transaction” (as defined in Section 406 of
ERISA or Section 4975 of the Code) involving any Plan’ and in each case in
clauses (i) through (v) above, such event or condition, together with
all other such events or conditions, if any, could reasonably be expected to
have a Material Adverse Effect;

 

(l)    any one or more of the
following shall occur and be continuing:

 

(i)            any “Person”
(as such term is used in Sections 13(d) and 14(d) of the Securities
and Exchange Act of 1934 (the “Exchange Act”)), other than the Permitted
Holders, is or becomes the beneficial owner (as defined in Rules 13d-3 and
13d-5 under the Exchange Act, except that a person shall be deemed to have “beneficial
ownership” of all shares that any such person has the right to acquire, whether
such right is exercisable immediately or only after the passage of time),
directly or indirectly, of more than 35% of the voting stock of Parent (for
purposes of calculating the voting stock held by a group, the voting stock
beneficially owned by a Permitted Holder shall be excluded to the extent such
Permitted Holder is part of such group);

 

(ii)           during any
period of two consecutive years (commencing immediately following the Closing
Date), individuals who at the beginning of such period constituted the board of
directors of Parent (together with any new directors whose election by such
board of directors or whose nomination for election by Parent’s shareholders
was approved by a vote of a majority of Parent’s directors then still in office
who either were directors at the beginning of such period or whose election or
nomination for election was previously so approved) cease for any reason to
constitute a majority of Parent’s directors then in office;

 

(iii)          any change in
control with respect to Parent (or similar event, however denominated) shall
occur under and as defined in the First Lien Credit Agreement, any Indenture or
other agreement in respect of Indebtedness in an aggregate principal amount of
at least $28,750,000 (other than the First Lien Credit Documents) to which Parent
or any of its Subsidiaries is a party; or

 

(iv)          Parent shall
cease to own directly or indirectly 100% of the Capital Stock of the Borrower;

 

(m)  (i) any Security
Document, after delivery thereof pursuant to Section 5.1 or 6.6, shall for
any reason (other than pursuant to the terms hereof or thereof) cease to create
a valid and perfected lien, with the priority required by the Security
Documents (or other security purported to be created on the applicable
Collateral) on and security interest in any material portion of the Collateral
purported to be covered thereby, subject to Permitted Liens, except to the
extent that any such loss of perfection or priority results from the failure of
the Administrative Agent to maintain possession of certificates actually
delivered to it representing securities pledged under the Security Documents
and except as to Collateral consisting of real property to the extent that such
losses are covered by a lender’s title insurance policy and such insurer has
not disputed coverage or

 

94

 

(ii) the
Guarantee contained in Section 2 of the Guarantee and Collateral Agreement
shall cease, for any reason, to be in full force and effect or any Loan Party
shall so assert;

 

then, and in any such event, (A) upon
the occurrence of an actual or deemed entry of an order for relief with respect
to the Borrower under the United States Bankruptcy Code, automatically the
Loans hereunder (with accrued interest thereon) and all other amounts owing
under this Agreement and the other Loan Documents shall immediately become due
and payable, and (B) if such event is any other Event of Default, then,
any or all of the following actions may be taken:  (i) with the consent of the Required
Lenders, the Administrative Agent may, or upon the request of the Required Lenders,
the Administrative Agent shall, exercise any remedy with respect to the
Collateral provided for in any Security Document and (ii) with the consent
of the Required Lenders, the Administrative Agent may, or upon the request of
the Required Lenders, the Administrative Agent shall, by notice to the
Borrower, declare the Loans hereunder (with accrued interest thereon) and all
other amounts owing under this Agreement and the other Loan Documents to be due
and payable forthwith, whereupon the same shall immediately become due and
payable.

 

SECTION 9.           THE AGENTS

 

9.1.          Appointment. 
Each Lender hereby irrevocably designates and appoints the Agents as the
agents of such Lender under this Agreement and the other Loan Documents, and
each Lender irrevocably authorizes each Agent, in such capacity, to take such
action on its behalf under the provisions of this Agreement and the other Loan
Documents and to exercise such powers and perform such duties as are expressly
delegated to such Agent by the terms of this Agreement and the other Loan
Documents, together with such other powers as are reasonably incidental
thereto.  Notwithstanding any provision
to the contrary elsewhere in this Agreement, no Agent shall have any duties or
responsibilities, except those expressly set forth herein, or any fiduciary
relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against any Agent.

 

9.2.          Delegation of Duties.  Each Agent may execute any of its duties
under this Agreement and the other Loan Documents by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties.  No Agent
shall be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care.

 

9.3.          Exculpatory Provisions.  Neither any Agent nor any of its officers,
directors, employees, agents, attorneys-in-fact or affiliates shall be (a) liable
for any action lawfully taken or omitted to be taken by it or such Person under
or in connection with this Agreement or any other Loan Document (except to the
extent that any of the foregoing are found by a final and nonappealable
decision of a court of competent jurisdiction to have resulted from its or such
Person’s own gross negligence or willful misconduct) or (b) responsible in
any manner to any of the Lenders for any recitals, statements, representations
or warranties made by any Loan Party or any officer thereof contained in this
Agreement or any other Loan Document or in any certificate, report, statement
or other document referred to or provided for in, or 

 

95

 

received by the Agents under
or in connection with, this Agreement or any other Loan Document or for the
value, validity, effectiveness, genuineness, enforceability or sufficiency of
this Agreement or any other Loan Document or for any failure of any Loan Party
a party thereto to perform its obligations hereunder or thereunder.  The Agents shall not be under any obligation
to any Lender to ascertain or to inquire as to the observance or performance of
any of the agreements contained in, or conditions of, this Agreement or any
other Loan Document, or to inspect the properties, books or records of any Loan
Party.

 

9.4.          Reliance by Agents.  Each Agent shall be entitled to rely, and
shall be fully protected in relying, upon any instrument, writing, resolution,
notice, consent, certificate, affidavit, letter, telecopy, telex, electronic
mail or teletype message, statement, order or other document or conversation
believed by it to be genuine and correct and to have been signed, sent or made
by the proper Person or Persons and upon advice and statements of legal counsel
(including, without limitation, counsel to the Loan Parties), independent
accountants and other experts selected by such Agent.  The Agents may deem and treat the payee of
any Note as the owner thereof for all purposes unless such Note shall have been
transferred in accordance with Section 10.6 and all actions required by
such Section in connection with such transfer shall have been taken.  Each Agent shall be fully justified in
failing or refusing to take any action under this Agreement or any other Loan
Document unless it shall first receive such advice or concurrence of the
Required Lenders (or, if so specified by this Agreement, all Lenders or any
other instructing group of Lenders specified by this Agreement) as it deems
appropriate or it shall first be indemnified to its satisfaction by the Lenders
against any and all liability and expense that may be incurred by it by reason
of taking or continuing to take any such action.  Each Agent shall in all cases be fully
protected in acting, or in refraining from acting, under this Agreement and the
other Loan Documents in accordance with a request of the Required Lenders (or,
if so specified by this Agreement, all Lenders or any other instructing group
of Lenders specified by this Agreement), and such request and any action taken
or failure to act pursuant thereto shall be binding upon all the Lenders and
all future holders of the Loans.

 

9.5.          Notice of Default.  No Agent shall be deemed to have knowledge or
notice of the occurrence of any Default or Event of Default hereunder unless
such Agent shall have received notice from a Lender, Parent, Holdings or the
Borrower referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a “notice of default”.  In the event that the Administrative Agent
shall receive such a notice, the Administrative Agent shall give notice thereof
to the Lenders.  The Administrative Agent
shall take such action with respect to such Default or Event of Default as
shall be reasonably directed by the Required Lenders (or, if so specified by
this Agreement, all Lenders or any other instructing group of Lenders specified
by this Agreement); provided that unless and until the Administrative
Agent shall have received such directions, the Administrative Agent may (but
shall not be obligated to) take such action, or refrain from taking such
action, with respect to such Default or Event of Default as it shall deem
advisable in the best interests of the Lenders.

 

9.6.          Non-Reliance on Agents and
Other Lenders.  Each Lender
expressly acknowledges that neither any of the Agents nor any of their
respective officers, directors, employees, agents, attorneys-in-fact or
affiliates have made any representations or warranties to it and that no act by
any Agent hereafter taken, including any review of the affairs of a Loan Party
or any affiliate of a Loan Party, shall be deemed to constitute any
representation or 

 

96

 

warranty by any Agent to any
Lender.  Each Lender represents to the
Agents that it has, independently and without reliance upon any Agent or any
other Lender, and based on such documents and information as it has deemed appropriate,
made its own appraisal of and investigation into the business, operations,
Property, financial and other condition and creditworthiness of the Loan
Parties and their affiliates and made its own decision to make its Loans
hereunder and enter into this Agreement. 
Each Lender also represents that it will, independently and without
reliance upon any Agent or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement and the other Loan Documents, and to make such investigation as
it deems necessary to inform itself as to the business, operations, Property,
financial and other condition and creditworthiness of the Loan Parties and
their affiliates.  Except for notices,
reports and other documents expressly required to be furnished to the Lenders
by the Administrative Agent hereunder, no Agent shall have any duty or
responsibility to provide any Lender with any credit or other information
concerning the Business, Property, condition (financial or otherwise),
prospects or creditworthiness of any Loan Party or any affiliate of a Loan
Party that may come into the possession of such Agent or any of its officers,
directors, employees, agents, attorneys-in-fact or affiliates.

 

9.7.          Indemnification.  The Lenders agree to indemnify each Agent in
its capacity as such (to the extent not reimbursed by Parent, Holdings or the
Borrower and without limiting the obligation of Parent, Holdings or the
Borrower to do so), ratably according to the respective amounts of outstanding Loans held by Lenders in effect on
the date on which indemnification is sought under this Section (or, if
indemnification is sought after the date upon which the Commitments shall have
terminated and the Loans shall have been paid in full, ratably in accordance
with the respective amounts of outstanding Loans held by Lenders immediately
prior to such date), for, and to save each Agent harmless from and against, any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind whatsoever that
may at any time (including, without limitation, at any time following the
payment of the Loans) be imposed on, incurred by or asserted against such Agent
in any way relating to or arising out of, the Commitments, this Agreement, any
of the other Loan Documents or any documents contemplated by or referred to
herein or therein or the transactions contemplated hereby or thereby or any
action taken or omitted by such Agent under or in connection with any of the
foregoing; provided that no Lender shall be liable for the payment of
any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements that are found by a
final and nonappealable decision of a court of competent jurisdiction to have
resulted from such Agent’s gross negligence or willful misconduct.  The Administrative Agent shall have the right
to deduct any amount owed to it by any Lender under this Section from any
payment made by it to such Lender hereunder. 
The agreements in this Section shall survive the payment of the
Loans and all other amounts payable hereunder.

 

9.8.          Agent in Its Individual Capacity.  Each Agent and its affiliates may make loans
to, accept deposits from and generally engage in any kind of business with any
Loan Party as though such Agent were not an Agent.  With respect to its Loans made or renewed by
it, each Agent shall have the same rights and powers under this Agreement and
the other Loan 

 

97

 

Documents as any Lender and
may exercise the same as though it were not an Agent, and the terms “Lender”
and “Lenders” shall include each Agent in its individual capacity.

 

9.9.          Successor Agents.  The Administrative Agent may resign as
Administrative Agent upon 10 days’ notice to the Lenders and the Borrower.  If the Administrative Agent shall resign as
Administrative Agent under this Agreement and the other Loan Documents, then
the Required Lenders shall appoint a successor agent for the Lenders, which
successor agent shall (unless an Event of Default under Section 8(g), (h) or
(i) with respect to Parent, Holdings or the Borrower shall have occurred
and be continuing) be subject to approval by the Borrower (which approval shall
not be unreasonably withheld or delayed), whereupon such successor agent shall
succeed to the rights, powers and duties of the Administrative Agent, and the
term “Administrative Agent” shall mean such successor agent effective upon such
appointment and approval, and the former Administrative Agent’s rights, powers
and duties as Administrative Agent shall be terminated, without any other or
further act or deed on the part of such former Administrative Agent or any of
the parties to this Agreement or any holders of the Loans.  If no successor agent has accepted
appointment as Administrative Agent by the date that is 10 days following a
retiring Administrative Agent’s notice of resignation, the retiring
Administrative Agent’s resignation shall nevertheless thereupon become
effective, and the Lenders shall assume and perform all of the duties of the
Administrative Agent hereunder until such time, if any, as the Required Lenders
appoint a successor agent as provided for above.  The Syndication Agent may, at any time, by
notice to the Lenders and the Administrative Agent, resign as Syndication Agent
hereunder, whereupon the duties, rights, obligations and responsibilities of such
Syndication Agent hereunder shall automatically be assumed by, and inure to the
benefit of, the Administrative Agent, without any further act by such
Syndication Agent, the Administrative Agent or any Lender.  After any retiring Agent’s resignation as Agent,
the provisions of this Section 9 shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was Agent under this
Agreement and the other Loan Documents.

 

9.10.        Authorization to Release
Liens and Guarantees.  The Administrative
Agent is hereby irrevocably authorized by each of the Lenders to effect any
release of Liens or guarantee obligations contemplated by Section 10.16.

 

9.11.        Authorization to Enter into Intercreditor
Agreement.  The Lenders hereby authorize the Administrative
Agent to enter into the Intercreditor Agreement and acknowledge that they will be bound thereby.

 

9.12.        The Arranger, Syndication
Agent and Documentation Agent.  Neither the Arranger nor the Syndication
Agent, nor the Documentation Agent, in its capacity as such, shall have any
duties or responsibilities, and none of them shall incur any liability, under
this Agreement and the other Loan Documents.

 

9.13.        Withholding Taxes.  To the extent required by any applicable law, the
Administrative Agent may withhold from any payment to any Lender an amount
equivalent to any applicable withholding tax. 
If the Internal Revenue Service or any other Governmental Authority
asserts a claim that the Administrative Agent did not properly withhold tax
from amounts paid to or for the account of any Lender or Transferee because the
appropriate form was 

 

98

 

not delivered or was not properly executed or because
such Lender failed to notify the Administrative Agent of a change in
circumstance which rendered the exemption from, or reduction of, withholding
tax ineffective or for any other reason, such Lender shall indemnify the
Administrative Agent fully for all amounts paid, directly or indirectly, by the
Administrative Agent as tax or otherwise, including any penalties or interest
and together with all expenses (including legal expenses, allocated internal
costs and out-of-pocket expenses) incurred.

 

SECTION 10.         MISCELLANEOUS

 

10.1.        Amendments and Waivers. 
Neither this Agreement or any other Loan Document, nor any terms hereof
or thereof, may be amended, supplemented or modified except in accordance with
the provisions of this Section 10.1. 
The Required Lenders and each Loan Party party to the relevant Loan
Document may, or (with the written consent of the Required Lenders) the
Administrative Agent and each Loan Party party to the relevant Loan Document
may, from time to time, (i) enter into written amendments, supplements or
modifications hereto and to the other Loan Documents (including amendments and
restatements hereof or thereof) for the purpose of adding any provisions to
this Agreement or the other Loan Documents or changing in any manner the rights
of the Lenders or of the Loan Parties hereunder or thereunder or (ii) waive,
on such terms and conditions as may be specified in the instrument of waiver,
any of the requirements of this Agreement or the other Loan Documents or any
Default or Event of Default and its consequences; provided, however,
that no such waiver and no such amendment, supplement or modification shall:

 

(A)  forgive the principal amount or extend the final
scheduled date of maturity of any Loan, reduce the stated rate of any interest
or fee payable hereunder or extend the scheduled date of any payment thereof,
or increase the amount or extend the expiration date of any Commitment of any
Lender, in each case without the consent of each Lender directly affected
thereby (it being understood that a waiver of any condition precedent set forth
in Section 5.1(v) and (w) or the waiver of any Default,
mandatory prepayment or mandatory reduction of the Commitments shall not
constitute an extension or increase of any Commitment of any Lender and it
being further understood that the waiver of (or amendment to the terms of) any
mandatory prepayment of the Loans shall not constitute a postponement of any
date scheduled for the payment of principal or interest); provided that only
the consent of the Required Lenders shall be necessary to amend the default
rate of interest set forth in Section 3.7(c) or to waive any
obligation of the Borrower to pay interest at such default rate;

 

(B)   amend, modify or waive any provision of this Section or
reduce any percentage specified in the definition of Required Lenders, consent
to the assignment or transfer by the Borrower of any of its rights and
obligations under this Agreement, release all or substantially all of the
Collateral, release Parent as a Guarantor or release all or substantially all
of the aggregate value of the Guarantees of the Obligations, in each case
without the consent of all Lenders (in each case, except as permitted by any
Loan Document);

 

99

 

(C)   change the percentage specified in the definition of
the Required Lenders without the written consent of all Lenders;

 

(D)  amend, modify or waive any provision of Section 9,
or any other provision affecting any Agent or Arranger without the consent of
such Agent or Arranger directly affected thereby; and

 

(E)   amend, modify or waive any provision of Section 3.10
without the consent of each Lender directly affected thereby.

 

Any such waiver and any such amendment,
supplement or modification effected pursuant to the foregoing shall apply
equally to each of the Lenders and shall be binding upon the Loan Parties,
Parent, the Lenders, the Administrative Agent and all future holders of the
Loans.  In the case of any waiver, the
Loan Parties, the Lenders and the Administrative Agent shall be restored to
their former position and rights hereunder and under the other Loan Documents,
and any Default or Event of Default waived shall be deemed to be cured and not
continuing; but no such waiver shall extend to any subsequent or other Default
or Event of Default, or impair any right consequent thereon.  Any such waiver, amendment, supplement or
modification shall be effected by a written instrument signed by the parties
required to sign pursuant to the foregoing provisions of this Section; provided,
that delivery of an executed signature page of any such instrument by
facsimile or other electronic transmission shall be effective as delivery of a
manually executed counterpart thereof.

 

Notwithstanding anything to
the contrary contained in this Section 10.1, (a) this Agreement and
the other Loan Documents may be amended with the consent of the Administrative
Agent at the request of the Borrower without the need to obtain the consent of
any other Lender if such amendment is delivered in order to cure any ambiguity
or defect and such amendment is requested within 30 days of the Closing Date, (b) in
the event that the Borrower requests that this Agreement be modified or amended
in a manner that would require the unanimous consent of all of the Lenders and
such modification or amendment is agreed to by the Required Lenders, then with
the consent of the Borrower and the Required Lenders, the Borrower and the
Required Lenders shall be permitted to amend the Agreement without the consent
of the Non-Consenting Lenders to provide for (i) the termination of the
Commitment of each Non-Consenting Lender, (ii) (A) the addition to
this Agreement of one or more other financial institutions (each of which shall
be a Lender, an affiliate of a Lender or an Approved Fund), and the making of
additional Loans by such new financial institutions or (B) the making of
additional Loans by one or more of the Required Lenders (with the written
consent thereof), as the case may be, in each case, as may be necessary to
repay in full, at par, the outstanding Loans of the Non-Consenting Lenders
immediately before giving effect to such amendment and (iii) such other
modifications to this Agreement as may be appropriate to effect the foregoing
clauses (i), (ii) and (iii).

 

For the avoidance of doubt, subject to the terms of
the First Lien Credit Documents and the Intercreditor Agreement, this Agreement
may be amended (or amended and restated) with the written consent of the
Required Lenders, the Administrative Agent and each Loan Party to each relevant
Loan Document (x) to add one or more additional credit facilities to this
Agreement and to permit the extensions of credit from time to time outstanding
thereunder 

 

100

 

and the accrued interest,
fees and other amounts in respect thereof (collectively, the “Additional
Extensions of Credit”) to share ratably in the benefits of this Agreement
and the other Loan Documents with the Loans and the accrued interest and fees
in respect thereof and (y) to include appropriately the Lenders holding
such credit facilities in any determination of the Required Lenders; provided,
however, that no such amendment shall permit the Additional Extensions
of Credit to share ratably with or with preference to the Loans in the
application of prepayments without the consent of the Required Lenders, and no
such amendment shall, without the consent of all Lenders, subordinate any of
the Loans, or any of the rights in the Collateral of any Lenders, to any such
Additional Extension of Credit.

 

10.2.        Notices.  Unless otherwise expressly provided herein, all
notices, requests and demands to or upon the respective parties hereto to be
effective shall be in writing (including by telecopy or electronic mail
pursuant to procedures approved by the Administrative Agent), and shall be
deemed to have been duly given or made when delivered, or three Business Days
after being deposited in the mail, postage prepaid, or, in the case of telecopy
or electronic mail notice, when received, addressed (i) in the case of
Parent, Holdings, the Borrower and the Agents as set forth below, (ii) in
the case of the Lenders, as set forth in an administrative questionnaire
delivered to the Administrative Agent or on Schedule I to the Lender Addendum
to which such Lender is a party or, in the case of a Lender which becomes a
party to this Agreement pursuant to an Assignment and Acceptance, in such
Assignment and Acceptance or (iii) in the case of any party, to such other
address as such party may hereafter notify to the other parties hereto:

 

	
  Parent
  or Holdings:

  	
   

  	
  c/o
  Six Flags Operations Inc. 

  1540 Broadway, 15th Floor 

  New York, New York 10036 

  Attention: Chief Financial Officer 

  Telecopy: 212-354-3089 

  Electronic Mail: jspeed@sftp.com 

  Telephone: 212-652-9384

  
	
   

  	
   

  	
   

  
	
  with
  a copy to:

  	
   

  	
  Six
  Flags Operations Inc. 

  1540 Broadway, 15th Floor 

  New York, New York 10036 

  Attention: General Counsel 

  Telecopy: 212-354-3089 

  Electronic Mail: jcoughli@sftp.com 

  Telephone: 212-652-9380

  
	
   

  	
   

  	
   

  
	
  The
  Borrower:

  	
   

  	
  Six
  Flags Theme Parks Inc. 

  c/o Holdings, as set forth above

  

 

101

 

	
   

  	
   

  	
   

  
	
  with
  a copy to, with respect to Sections 3.12(e), 10.6(b)(ii) and
  10.6(c)(ii):

  	
   

  	
  Andrews
  Kurth LLP 

  450 Lexington Avenue 

  New York, New York 10017 

  Attention: Andrew Feiner 

  Telecopy: 212.813.8170 

  Electronic Mail: andyfeiner@andrewskurth.com 

  Telephone: 212.850.2883

  
	
   

  	
   

  	
   

  
	
  The
  Administrative Agent or the Syndication Agent:

  	
   

  	
  Goldman
  Sachs Lending Partners LLC 

  c/o Goldman, Sachs & Co. 

  30 Hudson Street, 36th Floor 

  Jersey City, NJ 07302 

  Attention: SBD Operations 

  Attention: 
  Andrew Caditz 

  Telecopier:  (212) 428-1243  

  Email and for delivery of final financial statements for posting:
  gsd.link@gs.com

  
	
   

  	
   

  	
   

  
	
  with
  a copy to:

  	
   

  	
  Goldman
  Sachs Lending Partners LLC 

  200 West Street 

  New York, New York  10282-2198 

  Attention:  Elizabeth Fischer 

  Telecopier:  (212) 902-3000

  

 

provided that any
notice, request or demand to or upon the any Agent or any Lender shall not be
effective until received.  The attorneys
for any party may, but shall not be required to, give any notice on behalf of
their respective client.

 

10.3.        No Waiver; Cumulative
Remedies.  No failure
to exercise and no delay in exercising, on the part of any Agent or any Lender,
any right, remedy, power or privilege hereunder or under the other Loan
Documents shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, remedy, power or privilege hereunder preclude any other
or further exercise thereof or the exercise of any other right, remedy, power
or privilege.  The rights, remedies,
powers and privileges herein provided are cumulative and not exclusive of any
rights, remedies, powers and privileges provided by law.

 

10.4.        Survival of Representations
and Warranties.  All
representations and warranties made hereunder, in the other Loan Documents and
in any document, certificate or statement delivered pursuant hereto or in
connection herewith shall survive the execution and delivery of this Agreement
and the making of the Loans and other extensions of credit hereunder.

 

10.5.        Payment of Expenses.  The Borrower agrees (a) to pay or
reimburse the Administrative Agent and the Arranger for all their reasonable
and documented out-of-pocket 

 

102

 

costs and expenses incurred
in connection with the syndication of the Facility (including the charges of
Intralinks but excluding fees payable to syndicate members) and the
development, preparation and execution of, and any amendment, supplement or
modification to, this Agreement and the other Loan Documents and any other
documents prepared in connection herewith or therewith, and the consummation
and administration of the transactions contemplated hereby and thereby,
including, without limitation, the reasonable fees and disbursements and other
charges of one primary counsel to the Administrative Agent (and, if necessary,
one local counsel in each relevant jurisdiction (which, for the avoidance of
doubt, may include each jurisdiction where a Mortgaged Property is located and,
without duplication, each other jurisdiction where a Guarantor is organized)), (b) to
pay or reimburse each Lender and the Agents for all their costs and expenses
incurred in connection with the enforcement or preservation of any rights under
this Agreement, the other Loan Documents and any such other documents
(including in connection with any workout, restructuring or negotiations in
respect thereof), including, without limitation, the fees and disbursements of
counsel to the Lenders and the Agents, (c) to pay, indemnify, or reimburse
each Lender and the Agents for, and hold each Lender and the Agents harmless
from, any and all recording and filing fees and any and all liabilities with
respect to, or resulting from any delay in paying, stamp, excise and other
taxes, if any, which may be payable or determined to be payable in connection
with the execution and delivery of, or consummation or administration of any of
the transactions contemplated by, or any amendment, supplement or modification
of, or any waiver or consent under or in respect of, this Agreement, the other
Loan Documents and any such other documents, and (d) to pay, indemnify or
reimburse each Lender, each Agent, their respective affiliates, and their
respective officers, directors, trustees, employees, advisors, agents and
controlling persons (each, an “Indemnitee”) for, and hold each
Indemnitee harmless from and against, any and all other liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever with respect to the
execution, delivery, enforcement, performance and administration of this
Agreement, the other Loan Documents and any such other documents, including,
without limitation, any of the foregoing relating to the use of proceeds of the
Loans or the violation of, noncompliance with or liability under, any
Environmental Law applicable to the operations of Parent or any of its
Subsidiaries or any of the Properties and the fees and disbursements and other
charges of legal counsel in connection with claims, actions or proceedings by
any Indemnitee against any Loan Party hereunder (all the foregoing in this
clause (d), collectively, the “Indemnified Liabilities”), provided,
that the Borrower shall have no obligation hereunder to any Indemnitee with
respect to Indemnified Liabilities to the extent such Indemnified Liabilities
are found by a court of competent jurisdiction to have resulted from the gross
negligence or willful misconduct of such Indemnitee or of any director,
officer, or employee of such Indemnitee. 
Without limiting the foregoing, and to the extent permitted by
applicable law, Parent agrees not to assert and to cause its Subsidiaries not
to assert, and hereby waives and agrees to cause its Subsidiaries so to waive,
all rights for contribution or any other rights of recovery with respect to all
claims, demands, penalties, fines, liabilities, settlements, damages, costs and
expenses of whatever kind or nature, under or related to Environmental Laws,
that any of them might have by statute or otherwise against any
Indemnitee.  All amounts due under this Section shall
be payable not later than 30 days after written demand therefor.  Statements for amounts payable by the
Borrower pursuant to this Section shall be submitted to the attention of
the Chief Financial Officer (Telephone No. 212-652-9384) (Fax No. 212-354-3089),
at the address of the Borrower set forth in Section 10.2, or to 

 

103

 

such other Person or address
as may be hereafter designated by the Borrower in a written notice to the
Administrative Agent.  The agreements in
this Section shall survive repayment of the Loans and all other amounts
payable hereunder.

 

10.6.        Successors and Assigns;
Participations and Assignments

 

(a)   The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns permitted hereby, except that (i) no
Borrower may assign or otherwise transfer any of its rights or obligations
hereunder without the prior written consent of each Lender (and any attempted
assignment or transfer by the Borrower without such consent shall be null and
void) and (ii) no Lender may assign or otherwise transfer its rights or
obligations hereunder except in accordance with this Section.

 

(b)   (i) Subject to the
conditions set forth in paragraph (b)(ii) below, any Lender may assign to
one or more assignees (each, an “Assignee”) all or a portion of its
rights and obligations under this Agreement (including all or a portion of the
Loans at the time owing to it) with the prior written consent (such consent not
to be unreasonably withheld or delayed) of:

 

(A)  the Borrower, provided that no consent of the
Borrower shall be required for an assignment to (x) a Lender, an affiliate
of a Lender, an Approved Fund (as defined below) or (y) if an Event of
Default has occurred and is continuing or if the principal amount of Loans
being assigned to an Assignee is in an aggregate amount of less than
$10,000,000, any other Person (other than a natural person); and

 

(B)   the Administrative Agent, provided that no
consent of the Administrative Agent shall be required for an assignment of all
or any portion of a Loan to a Lender, an affiliate of a Lender or an Approved
Fund.

 

(ii)           Assignments
shall be subject to the following additional conditions:

 

(A)  except in the case of an assignment to a Lender, an
Affiliate of a Lender or an Approved Fund or an assignment of the entire
remaining amount of the assigning Lender’s Loans, the amount of the Loans of
the assigning Lender subject to each such assignment (determined as of the date
the Assignment and Acceptance with respect to such assignment is delivered to
the Administrative Agent) shall not be less than $1,000,000  unless
each of the Borrower and the Administrative Agent otherwise consent, provided
that (1) no such consent of the Borrower shall be required if an Event of
Default has occurred and is continuing and (2) such amounts shall be
aggregated in respect of each Lender and its affiliates or Approved Funds, if
any;

 

(B)   (1) the parties to each assignment shall
execute and deliver to the Administrative Agent an Assignment and Acceptance,
together with a processing and recordation fee of $3,500 (payable among the
Lenders party to the Assignment and Acceptance), which shall be paid once in
connection with simultaneous assignments for a Lender and its affiliates and
Approved Funds (provided, however, that the Administrative Agent
may, in its sole discretion, elect to waive such processing and recordation fee
in the case of any assignment) and (2) the assigning Lender shall have
paid in full any amounts owing by it to the Administrative Agent;

 

104

 

(C)   the Assignee, if it shall not be a Lender, shall
deliver to the Administrative Agent an administrative questionnaire in which
the Assignee designates one or more credit contacts to whom all syndicate-level
information (which may contain material non-public information about the
Borrower and its Affiliates and their related parties or their respective
securities) will be made available and who may receive such information in
accordance with the assignee’s compliance procedures and applicable laws, including
Federal and state securities laws; and

 

(D)  the Assignee shall not be a Loan Party; provided
that the Borrower may be an Assignee in connection with an Auction.

 

For the purposes of this Section 10.6, “Approved
Fund” means any Person (other than a natural person) that is engaged in
making, purchasing, holding or investing in bank loans and similar extensions
of credit in the ordinary course of its business and that is administered or
managed by (a) a Lender, (b) an affiliate of a Lender or (c) an
entity or an affiliate of an entity that administers or manages a Lender.

 

(iii)          Subject to acceptance and
recording thereof pursuant to paragraph (b)(iv) below, from and after
the effective date specified in each Assignment and Acceptance the Assignee
thereunder shall be a party hereto and, to the extent of the interest assigned
by such Assignment and Acceptance, have the rights and obligations of a Lender
under this Agreement, and the assigning Lender thereunder shall, to the extent
of the interest assigned by such Assignment and Acceptance, be released from
its obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all of the assigning Lender’s rights and obligations under
this Agreement, such Lender shall cease to be a party hereto but shall continue
to be entitled to the benefits of Sections 3.11, 3.12, 3.13 and
10.5).  An Assignee shall not be entitled
to the benefits of Section 3.12 unless such Assignee complies with Section 3.12(e).  Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with this Section 10.6
shall be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with paragraph (c) of
this Section.

 

(iv)          The Administrative Agent,
acting for this purpose as an agent of the Borrower, shall maintain at one of
its offices a copy of each Assignment and Acceptance delivered to it and a
register for the recordation of the names and addresses of the Lenders, and the
Commitments of, and principal amount of the Loans owing to, each Lender
pursuant to the terms hereof from time to time (the “Register”) and
shall make such Register available for inspection by the Borrower from time to
time upon reasonable prior notice.  The
entries in the Register shall be conclusive, in the absence of manifest error
and the Borrower, the Administrative Agent and the Lenders may treat each
Person whose name is recorded in the Register pursuant to the terms hereof as a
Lender hereunder for all purposes of this Agreement, notwithstanding notice to
the contrary.  The Register
shall be available for inspection by any Lender from time to time upon
reasonable prior notice to the Administrative Agent.  Each Lender that sells a participation shall,
acting solely for this purpose as an agent of the Borrower, maintain a register
on which it enters the name and address of each Participant and the principal
amounts (and stated interest) of each participant’s interest in the Loans or other
obligations under this Agreement (the “Participant Register”). The
entries in the Participant Register shall be 

 

105

 

conclusive absent manifest error, and such
Lender shall treat each person whose name is recorded in the Participant
Register as the owner of such participation for all purposes of this Agreement
notwithstanding any notice to the contrary.

 

(v)           Upon its receipt of a duly
completed Assignment and Acceptance executed by an assigning Lender and an
Assignee, the Assignee’s completed administrative questionnaire (unless the
Assignee shall already be a Lender hereunder), the processing and recordation
fee referred to in paragraph (b) of this Section and any written
consent to such assignment required by paragraph (b) of this Section, the
Administrative Agent shall accept such Assignment and Acceptance and record the
information contained therein in the Register. 
No assignment shall be effective for purposes of this Agreement unless
it has been recorded in the Register as provided in this paragraph.

 

(c)   (i) Any Lender may,
without the consent of the Borrower or the Administrative Agent, sell
participations to one or more banks or other entities (a “Participant”)
in all or a portion of such Lender’s rights and obligations under this
Agreement (including all or a portion of its Commitments and the Loans owing to
it); provided that (A) such Lender’s obligations under this
Agreement shall remain unchanged, (B) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations
and (C) the Borrower, the Administrative Agent and the other Lenders shall
continue to deal solely and directly with such Lender in connection with such
Lender’s rights and obligations under this Agreement.  Any agreement pursuant to which a Lender
sells such a participation shall provide that such Lender shall retain the sole
right to enforce this Agreement and to approve any amendment, modification or
waiver of any provision of this Agreement; provided that such agreement
may provide that such Lender will not, without the consent of the Participant,
agree to any amendment, modification or waiver that (1) requires the
consent of each Lender directly affected thereby pursuant to the proviso to the
second sentence of Section 10.1 and (2) directly affects such
Participant.  Subject to paragraph (c)(ii) of
this Section, the Borrower agrees that each Participant shall be entitled to
the benefits of Sections 3.11, 3.12 and 3.13 to the same extent as if it were a
Lender and had acquired its interest by assignment pursuant to paragraph (b) of
this Section.  To the extent permitted by
law, each Participant also shall be entitled to the benefits of Section 10.7(b) as
though it were a Lender, provided such Participant shall be subject to Section 10.7(a) as
though it were a Lender.

 

(ii)           A Participant shall not be
entitled to receive any greater payment under Section 3.11 or 3.12 than
the applicable Lender would have been entitled to receive with respect to the
participation sold to such Participant, unless the sale of the participation to
such Participant is made with the Borrower’s written consent.  Any Participant that is a Non-U.S. Lender
shall not be entitled to the benefits of Section 3.12 unless such
Participant complies with Section 3.12(e).

 

(d)   Any Lender may at any time
pledge or assign a security interest in all or any portion of its rights under
this Agreement to secure obligations of such Lender, including any pledge or
assignment to secure obligations to a Federal Reserve Bank or other Person, and
this Section shall not apply to any such pledge or assignment of a
security interest; provided that no such pledge or assignment of a
security interest shall release a Lender from any of its obligations hereunder
or substitute any such pledgee or Assignee for such Lender as a party hereto.

 

106

 

(e)   The Borrower, upon receipt
of written notice from the relevant Lender, agrees to issue Notes to any Lender
requiring Notes to facilitate transactions of the type described in paragraph (d) above.

 

(f)    If the Borrower wishes to
replace the Loans with ones having different terms, it shall have the option,
with the consent of the Administrative Agent and subject to at least three
Business Days’ advance notice to the Lenders, instead of prepaying the Loans,
to (i) require the Lenders to assign such Loans to the Administrative
Agent or its designees and (ii) amend the terms thereof in accordance with
Section 10.1.  Pursuant to any such
assignment, all Loans shall be purchased at par (allocated among the Lenders in
the same manner as would be required if such Loans were being optionally
prepaid plus payment of any accrued interest and fees thereon and any amounts
owing pursuant to Sections 3.10(b) and 3.13).  By receiving such purchase price, the Lenders
shall automatically be deemed to have assigned the Loans pursuant to an
Assignment and Acceptance, and accordingly no other action by such Lenders
shall be required in connection therewith. 
The provisions of this paragraph are intended to facilitate the
maintenance of the perfection and priority of existing security interests in
the Collateral during any such replacement.

 

10.7.        Adjustments; Set-off.  (a) Except
to the extent that this Agreement provides for payments to be allocated to a
particular Lender, if any Lender shall at any time receive any payment of all
or part of the Obligations owing to it, or receive any Collateral in respect
thereof (whether voluntarily or involuntarily, by set-off, pursuant to events
or proceedings of the nature referred to in Section 8(g), (h) or (i),
or otherwise), in a greater proportion than any such payment to or Collateral
received by any other Lender, if any, in respect of the Obligations owing to
such other Lender (each benefited Lender referred to above, a “Benefited
Lender”) shall purchase for cash from the other Lenders a participating
interest in such portion of the Obligations owing to each such other Lender, or
shall provide such other Lenders with the benefits of any such Collateral, or
the proceeds thereof, as shall be necessary to cause such Benefited Lender to
share the excess payment or benefits of such Collateral, or the proceeds
thereof, ratably with each of the Lenders; provided, however,
that if all or any portion of such excess payment, benefits or proceeds is
thereafter recovered from such Benefited Lender, such purchase shall be
rescinded, and the purchase price and benefits returned, to the extent of such
recovery, but without interest.

 

(b)   In addition to any rights
and remedies of the Lenders provided by law, each Lender shall have the right,
without prior notice to Parent, Holdings or the Borrower, any such notice being
expressly waived by Parent, Holdings and the Borrower to the extent permitted
by applicable law, upon any amount becoming due and payable by the Borrower
hereunder (whether at the stated maturity, by acceleration or otherwise), to
set off and appropriate and apply against such amount any and all deposits
(general or special, time or demand, provisional or final), in any currency,
and any other credits, indebtedness or claims, in any currency, in each case
whether direct or indirect, absolute or contingent, matured or unmatured, at
any time held or owing by such Lender or any branch or agency thereof to or for
the credit or the account of Parent, Holdings or the Borrower, as the case may
be.  Each Lender agrees promptly to
notify Parent and the Administrative Agent after any such setoff and application
made by such Lender, provided that the failure to give such notice shall
not affect the validity of such setoff and application.

 

107

 

10.8.        U.S.A. Patriot Act.  Each Lender hereby
notifies the Borrower that pursuant to the requirements of the U.S.A. Patriot
Act, it is required to obtain, verify and record information that identifies
the Borrower, which information includes the name and address of the Borrower
and other information that will allow the Lenders to identify the Borrower in
accordance with the U.S.A. Patriot Act.

 

10.9.        Counterparts.  This Agreement may be executed by one or more
of the parties to this Agreement on any number of separate counterparts, and
all of said counterparts taken together shall be deemed to constitute one and
the same instrument.  Delivery of an
executed signature page of this Agreement or of a Lender Addendum by
facsimile or other electronic transmission shall be effective as delivery of a
manually executed counterpart hereof. A set of the copies of this Agreement
signed by all the parties shall be lodged with Holdings and the Administrative
Agent.

 

10.10.      Severability.  Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

 

10.11.      Integration.  This Agreement and the other Loan Documents
represent the entire agreement of the parties hereto with respect to the
subject matter hereof and thereof, and there are no promises, undertakings,
representations or warranties by the Arranger, any Agent or any Lender relative
to subject matter hereof not expressly set forth or referred to herein or in
the other Loan Documents.

 

10.12.      GOVERNING LAW.  THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS
OF THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

10.13.      Submission To Jurisdiction;
Waivers.  Each of the Agents, the
Lenders, Parent, Holdings and the Borrower hereby irrevocably and
unconditionally:

 

(a)   ACCEPTS GENERALLY AND UNCONDITIONALLY THE EXCLUSIVE JURISDICTION AND
VENUE OF ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION IN THE STATE,
COUNTY AND CITY OF NEW YORK (OTHER THAN WITH RESPECT TO ACTIONS BY THE
ADMINISTRATIVE AGENT IN RESPECT OF RIGHTS UNDER ANY SECURITY AGREEMENT GOVERNED
BY LAWS OTHER THAN THE LAWS OF THE STATE OF NEW YORK OR WITH RESPECT TO ANY
COLLATERAL SUBJECT THERETO);

 

(b)   consents that any such
action or proceeding may be brought in such courts and waives any objection
that it may now or hereafter have to the venue of any such action or proceeding
in any such court or that such action or proceeding was brought in an
inconvenient court and agrees not to plead or claim the same;

 

108

 

(c)   agrees that service of
process in any such action or proceeding may be effected by mailing a copy
thereof by registered or certified mail (or any substantially similar form of
mail), postage prepaid, to Parent or Holdings, as the case may be, at its
address set forth in Section 10.2 or at such other address of which the
Administrative Agent shall have been notified pursuant thereto;

 

(d)   agrees that nothing herein
shall affect the right to effect service of process in any other manner
permitted by law or shall limit the right to sue in any other jurisdiction; and

 

(e)   waives, to the maximum
extent not prohibited by law, any right it may have to claim or recover in any
legal action or proceeding referred to in this Section any special,
exemplary, punitive or consequential damages.

 

10.14.      Acknowledgments.  Each of Parent, Holdings and the Borrower
hereby acknowledges that:

 

(a)   it has been advised by
counsel in the negotiation, execution and delivery of this Agreement and the
other Loan Documents;

 

(b)   neither the Arranger, any
Agent nor any Lender has any fiduciary relationship with or duty to Parent,
Holdings or the Borrower arising out of or in connection with this Agreement or
any of the other Loan Documents, and the relationship between the Arranger, the
Agents and the Lenders, on one hand, and Parent, Holdings and the Borrower, on
the other hand, in connection herewith or therewith is solely that of debtor
and creditor; and

 

(c)   no joint venture is created
hereby or by the other Loan Documents or otherwise exists by virtue of the
transactions contemplated hereby among the Arranger, the Agents and the Lenders
or among Parent, Holdings, the Borrower and the Lenders.

 

10.15.      Confidentiality.  Each of the Agents and the Lenders agrees to
keep confidential all non-public information provided to it by any Loan Party
pursuant to this Agreement that is designated by such Loan Party as
confidential; provided that nothing herein shall prevent any Agent or any
Lender from disclosing any such information (a) to the Arranger, any
Agent, any other Lender or any affiliate of any thereof, (b) to any
Participant or Assignee (each, a “Transferee”) or prospective Transferee
that agrees to comply with the provisions of this Section, (c) to any of
its employees, directors, agents, attorneys, accountants and other professional
advisors, (d) to any financial institution that is a direct or indirect
contractual counterparty in swap agreements or such contractual counterparty’s
professional advisor (so long as such contractual counterparty or professional
advisor to such contractual counterparty agrees to be bound by the provisions
of this Section), (e) upon the request or demand of any Governmental
Authority having jurisdiction over it, (f) in response to any order of any
court or other Governmental Authority or as may otherwise be required pursuant
to any Requirement of Law, (g) in connection with any litigation or
similar proceeding, (h) that has been publicly disclosed other than in breach
of this Section, (i) to the National Association of Insurance
Commissioners or any similar organization or any nationally recognized rating
agency that 

 

109

 

requires
access to information about a Lender’s investment portfolio in connection with
ratings issued with respect to such Lender or (j) in connection with the
exercise of any remedy hereunder or under any other Loan Document.

 

EACH LENDER ACKNOWLEDGES THAT INFORMATION FURNISHED
TO IT PURSUANT TO THIS AGREEMENT MAY INCLUDE MATERIAL NON-PUBLIC
INFORMATION CONCERNING THE BORROWER AND ITS RELATED PARTIES OR THEIR RESPECTIVE
SECURITIES, AND CONFIRMS THAT IT HAS DEVELOPED COMPLIANCE PROCEDURES REGARDING
THE USE OF MATERIAL NON-PUBLIC INFORMATION AND THAT IT WILL HANDLE SUCH
MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH THOSE PROCEDURES AND
APPLICABLE LAW, INCLUDING FEDERAL AND STATE SECURITIES LAWS.

 

ALL INFORMATION, INCLUDING REQUESTS FOR WAIVERS AND
AMENDMENTS, FURNISHED BY THE BORROWER OR THE ADMINISTRATIVE AGENT PURSUANT TO,
OR IN THE COURSE OF ADMINISTERING, THIS AGREEMENT WILL BE SYNDICATE-LEVEL
INFORMATION, WHICH MAY CONTAIN MATERIAL NON-PUBLIC INFORMATION ABOUT THE
BORROWER AND THEIR RELATED PARTIES OR THEIR RESPECTIVE SECURITIES.  ACCORDINGLY, EACH LENDER REPRESENTS TO THE
BORROWER AND THE ADMINISTRATIVE AGENT THAT IT HAS IDENTIFIED IN ITS
ADMINISTRATIVE QUESTIONNAIRE A CREDIT CONTACT WHO MAY RECEIVE INFORMATION
THAT MAY CONTAIN MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH ITS
COMPLIANCE PROCEDURES AND APPLICABLE LAW.

 

10.16.      Release of Collateral and Guarantee
Obligations.

 

(a)    Notwithstanding anything to
the contrary contained herein or in any other Loan Document, upon request of
Parent or the Borrower in connection with any Disposition of Property permitted
by the Loan Documents, the Administrative Agent shall (without notice to, or
vote or consent of, any Lender) take such actions as shall be required to
release or subordinate its security interest in any Collateral being Disposed of
in such Disposition, and to release or subordinate any guarantee obligations
(or execute a subordination, non-disturbance or attornment agreement) under any
Loan Document of any Person being Disposed of in such Disposition, to the
extent necessary to permit consummation of such Disposition in accordance with
the Loan Documents.

 

(b)   Notwithstanding anything to
the contrary contained herein or any other Loan Document, when all Obligations
have been paid in full, upon request of Parent, the Administrative Agent shall
(without notice to, or vote or consent of, any Lender) take such actions as
shall be required to release its security interest in all Collateral, and to
release all guarantee obligations under any Loan Document.  Any such release of guarantee obligations
shall be deemed subject to the provision that such guarantee obligations shall
be reinstated if after such release any portion of any payment in respect
of  the Obligations guaranteed thereby
shall be rescinded or must otherwise be restored or returned upon the
insolvency, bankruptcy, dissolution, liquidation or reorganization of the
Borrower or any Guarantor, or upon or as a result of the appointment of a
receiver, intervenor or conservator of, or trustee or similar officer for, the 

 

110

 

Borrower or any Guarantor or any substantial
part of its Property, or otherwise, all as though such payment had not been
made.

 

10.17.      Accounting Changes.  In the event that any “Accounting Change” (as
defined below) shall occur and such change results in a change in the method of
calculation of financial covenants, standards or terms in this Agreement, then
Parent, the Borrower and the Administrative Agent agree to enter into
negotiations in order to amend such provisions of this Agreement so as to
equitably reflect such Accounting Changes with the desired result that the
criteria for evaluating the financial condition of Parent and the Borrower
shall be the same after such Accounting Changes as if such Accounting Changes
had not been made.  Until such time as
such an amendment shall have been executed and delivered by Parent, Holdings,
the Borrower, the Administrative Agent and the Required Lenders, all financial
covenants, standards and terms in this Agreement shall continue to be
calculated or construed as if such Accounting Changes had not occurred.  “Accounting Changes” refers to changes
in accounting principles required by the promulgation of any rule, regulation,
pronouncement or opinion by the Financial Accounting Standards Board, the
American Institute of Certified Public Accountants or, if applicable, the SEC.

 

10.18.      Delivery of
Lender Addenda.
Each initial Lender shall become a party to this Agreement by delivering to the
Administrative Agent a Lender Addendum duly executed by such Lender, the
Borrower and the Administrative Agent.

 

10.19.      WAIVERS OF JURY TRIAL.  EACH PARTY HERETO HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY
COUNTERCLAIM THEREIN.

 

10.20.      Intercreditor Agreement. 
In the event of any conflict between the terms of the Intercreditor
Agreement and this Agreement, the terms of the Intercreditor Agreement shall
govern and control.

 

[Remainder
of the page intentionally left blank.]

 

111

 

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

 

	
   

  	
  SIX
  FLAGS ENTERTAINMENT 

  CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  James M. Coughlin

  
	
   

  	
  Name:
  James M. Coughlin

  
	
   

  	
  Title:
  General Counsel

  
	
   

  	
   

  	
   

  
	
   

  	
  SIX
  FLAGS OPERATIONS INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  James M. Coughlin

  
	
   

  	
  Name:
  James M. Coughlin

  
	
   

  	
  Title:
  General Counsel

  
	
   

  	
   

  	
   

  
	
   

  	
  SIX
  FLAGS THEME PARKS INC.,

  
	
   

  	
    as Borrower

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  James M. Coughlin

  
	
   

  	
  Name:
  James M. Coughlin

  
	
   

  	
  Title:
  General Counsel

  
					

 

 

	
   

  	
  GOLDMAN
  SACHS LENDING PARTNERS 

  LLC, as Administrative Agent and Lender

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  

  
	
   

  	
   

  	
     Authorized SignatoryExhibit 10.4

 

Execution Version

 

SECOND LIEN
GUARANTEE AND COLLATERAL AGREEMENT, dated as of April 30, 2010 made by
each of the signatories hereto (together with any other entity that may become
a party hereto as provided herein, the “Grantors”), in favor of GOLDMAN
SACHS LENDING PARTNERS LLC, as Administrative Agent (in such capacity, the “Administrative
Agent”) for the banks and other financial institutions or entities (the “Lenders”)
from time to time parties to the Second Lien Credit Agreement, dated as of April 30,
2010 (as amended, supplemented, restated or otherwise modified from time to
time, the “Credit Agreement”), among SIX FLAGS ENTERTAINMENT CORPORATION
(formerly known as SIX FLAGS, INC.), a Delaware corporation (“Parent”),
SIX FLAGS OPERATIONS INC., a Delaware corporation (“Holdings”), SIX
FLAGS THEME PARKS INC., a Delaware corporation (the “Borrower”), the
Administrative Agent and the other agents named therein.

 

W  I  T
N  E  S  S  E  T  H:

 

WHEREAS, in
connection with the confirmation and implementation of the Plan of
Reorganization, the Borrower has requested that the Lenders make a loan of
$250,000,000 to the Borrower under the Credit Agreement in order to enable the
reorganized Debtors to consummate the transactions contemplated by the Plan of
Reorganization, pay related fees and expenses and finance the working capital
needs and general corporate purposes of the Borrower;

 

WHEREAS, the
Borrower and the other Grantors are engaged in related businesses, and each
Grantor will derive substantial direct and indirect benefit from the making of
the extensions of credit under the Credit Agreement; and

 

WHEREAS, it is a
condition precedent to the obligation of the Lenders to make their respective
extensions of credit to the Borrower under the Credit Agreement that the
Grantors shall have executed and delivered this Agreement to the Administrative
Agent for the ratable benefit of the Secured Parties;

 

NOW, THEREFORE, in
consideration of the premises and to induce the Administrative Agent and the
Lenders to enter into the Credit Agreement and to induce the Lenders to make
their respective extensions of credit to the Borrower thereunder, each Grantor
hereby agrees with the Administrative Agent, for the ratable benefit of the
Secured Parties, as follows:

 

SECTION 1.  DEFINED TERMS

 

1.1           Definitions.  (a)  Unless otherwise defined herein,
terms defined in the Credit Agreement and used herein shall have the meanings
given to them in the Credit Agreement, and the following terms are used herein
as defined in the New York UCC: 
Accounts, Certificated Security, Chattel Paper, Commercial Tort Claims,
Documents, Equipment, General Intangibles, Instruments, Inventory,
Letter-of-Credit Rights and Supporting Obligations; provided that none
of the foregoing UCC terms shall be deemed to include Excluded Assets.

 

(b)           The following terms shall have the
following meanings:

 

 

“Agreement”:  this Second Lien Guarantee and Collateral
Agreement, as the same may be amended, supplemented, restated or otherwise
modified from time to time.

 

“Borrower
Obligations”:  the collective unpaid
principal of and interest on (including, without limitation, interest accruing
at the then applicable rate provided in the Credit Agreement after the maturity
of the Loans and interest accruing at the then applicable rate provided in the
Credit Agreement after the filing of any petition in bankruptcy, or the
commencement of any insolvency, reorganization or like proceeding, relating to
the Borrower, whether or not a claim for post-filing or post-petition interest
is allowed in such proceeding) the Loans and all other obligations and
liabilities of the Borrower to the Administrative Agent or to any Secured
Party, whether direct or indirect, absolute or contingent, due or to become
due, or now existing or hereafter incurred, which may arise under, out of, or
in connection with, this Agreement, any other Loan Document or any other
document made, delivered or given by any Loan Party in connection herewith or
therewith, whether on account of principal, interest, reimbursement
obligations, fees, indemnities, costs, expenses (including, without limitation,
all fees, charges and disbursements of counsel to the Administrative Agent or
to any Secured Party that are required to be paid by the Borrower pursuant
hereto) or otherwise.

 

“Collateral”:  as defined in Section 3(a).

 

“Copyrights”:  (i) all works of authorship and
copyrights arising under the laws of the United States, any group of countries,
other country or any political subdivision thereof, whether registered or unregistered
and whether published or unpublished, all registrations thereof, and all
applications in connection therewith, including, without limitation, all
registrations and applications in the United States Copyright Office,
including, without limitation, any of the foregoing listed in Schedule 5, and (ii) the
right to obtain all renewals thereof.

 

“Copyright
Licenses”:  any written or oral
agreement naming any Grantor as licensor or licensee, granting any right under
any Copyright, including, without limitation, the grant of rights to
manufacture, distribute, exploit and sell materials derived from any Copyright,
including, without limitation, any of the foregoing listed in Schedule 5.

 

“Deposit
Account”:  as defined in the Uniform
Commercial Code of any applicable jurisdiction and, in any event, including,
without limitation, any demand, time, savings, passbook or like account
maintained with a depositary institution.

 

“Excluded
Assets”:  the collective reference to
(i) all Capital Stock owned by any Grantor in (A) Flags Beverages, Inc.,
Fiesta Texas Hospitality LLC, Spring Beverage Holding Corp. and other
Subsidiaries, if any, which have no material assets other than a liquor license
and (B) HWP Development Holdings, LLC, HWP Development LLC and any other
entity formed pursuant to the Great Escape Agreements and (C) Servicios de
Restaurantes Especializados, S.A. De C.V., (ii) any Trademark License with
Warner Bros. or its affiliates that expressly prohibits the granting of a
security interest therein (including but not limited to (A) those licenses
contemplated by the German WB Acquisition, and (B) the Amended and
Restated License Agreement #5854-WB/DC dated as of April 1, 1998 with the
Borrower and the License 

 

2

 

Agreement #8898-TOON dated January 1,
1998 between the Borrower and Warner Bros. Consumer Products Division (Cartoon
Network), as any of the foregoing may be amended from time to time), except, in
each case, to the extent that such term in such license providing for such
prohibition is ineffective under applicable law, (iii) any other Trademark
License that expressly prohibits the granting of a security interest therein,
except, in each case, to the extent that such term in such license providing
for such prohibition is ineffective under applicable law, (iv) that
portion of the Capital Stock of any Excluded Foreign Subsidiary that is in
excess of 65% of the total outstanding Capital Stock of such Excluded Foreign
Subsidiary, (v) the Capital Stock of a Subsidiary acquired after the date
hereof to the extent that Section 6.6(f) of the Credit Agreement does
not require the granting of a security interest therein, (vi) any Property of any Grantor covered by a pledge or
security interest under the New Time Warner Facility or subject to a negative  pledge thereunder, (vii) any Property owned by any Grantor to the extent that
creation of a security interest therein would be prohibited by a Contractual
Obligation binding on any Grantor that is the owner of such Property, including
pursuant to the New Time Warner Facility or the Partnership Parks Agreements
(provided that, with respect to Property acquired after the date hereof, such
Contractual Obligation existed at the time such property was acquired and was
not entered into in anticipation of such acquisition); provided, however, that such Property shall no longer
constitute “Excluded Assets” immediately at such time as such security interest
ceases to be prohibited by a binding Contractual Obligation, (viii) any Property of any Grantor to the extent that the
Administrative Agent shall determine in its sole discretion that the costs of
obtaining a security interest in such Property is excessive in relation to the value of
the security to be afforded thereby and (ix) United States intent-to-use
Trademark applications to the extent that, and solely during the period in
which, the grant of a security interest therein would impair the validity or
enforceability of such intent-to-use trademark applications under applicable
federal law.

 

“First
Lien Guarantee and Collateral Agreement”: the First Lien Guarantee and
Collateral Agreement, dated as of the date hereof, made by Parent, Holdings,
the Borrower and each Subsidiary Guarantor, in favor of the First Lien Administrative
Agent for the benefit of the secured parties thereunder.

 

“Foreign
Subsidiary”:  any Subsidiary
organized under the laws of any jurisdiction outside the United States of
America.

 

“Foreign
Subsidiary Voting Stock”:  the voting
Capital Stock of any Foreign Subsidiary.

 

“Guarantor
Obligations”:  with respect to any
Guarantor, all obligations and liabilities of such Guarantor which may arise
under or in connection with this Agreement (including, without limitation, Section 2)
or any other Loan Document to which such Guarantor is a party, in each case
whether on account of guarantee obligations, reimbursement obligations, fees,
indemnities, costs, expenses or otherwise (including, without limitation, all
fees and disbursements of counsel to the Administrative Agent or to the Secured
Parties that are required to be paid by such Guarantor pursuant to the terms of
this Agreement or any other Loan Document to which such Guarantor is a party).

 

“Guarantors”:  the collective reference to each Grantor
other than the Borrower.

 

3

 

“Infringement”: 
infringement, misappropriation, dilution or other impairment or
violation.

 

“Intellectual
Property”:  the collective reference
to all rights, priorities and privileges relating to intellectual property,
whether arising under United States, multinational or foreign laws or
otherwise, including, without limitation, the Copyrights, the Copyright
Licenses, the Patents, the Patent Licenses, the Trademarks, and the Trademark
Licenses, and all rights to sue at law or in equity for any Infringement
thereof, including the right to receive all proceeds and damages therefrom; provided
that Intellectual Property excludes any Excluded Assets.

 

“Intercompany
Note”:  any promissory note evidencing
loans made by any Grantor to Parent or any of its Subsidiaries.

 

“Investment
Property”:  the collective reference
to (i) all “investment property” as such term is defined in Section 9-102(a)(49)
of the New York UCC (other than any Foreign Subsidiary Voting Stock excluded
from the definition of “Pledged Stock”) and (ii) whether or not
constituting “investment property” as so defined, all Pledged Notes and all
Pledged Stock; provided that Investment Property excludes any Excluded
Assets.

 

“Issuers”:
 the collective reference to each issuer
of any Investment Property.

 

“Material
Trademarks”: all Trademarks included in the Collateral that are material to
the business of the applicable Grantor.

 

“New York UCC”: 
the Uniform Commercial Code as from time to time in effect in the State
of New York.

 

“Obligations”:  (i) in the case of the Borrower, the
Borrower Obligations, and (ii) in the case of each Guarantor, its
Guarantor Obligations.

 

“Patents”:  (i) all letters patent of the United
States, any group of countries, other country or any political subdivision
thereof, all reissues and extensions thereof, and (ii) all applications
for letters patent of the United States or any group of countries, other
country or any political subdivision thereof, and all reissues, divisions,
extensions, continuations and continuations-in-part thereof, similar legal
protections related thereto, or rights to obtain the foregoing, including,
without limitation, any of the foregoing listed in Schedule 5.

 

“Patent
License”:  any written or oral
agreement providing for the grant by or to any Grantor of any right to make,
have made, manufacture, use or sell (directly or indirectly), offer to sell,
import or dispose of any invention or practice any method covered in whole or
in part by a Patent, including, without limitation, any of the foregoing listed
in Schedule 5.

 

“Pledged
Notes”:  all promissory notes listed
on Schedule 2, all Intercompany Notes at any time issued to any Grantor and all
other promissory notes issued to or held by any Grantor (other than promissory
notes issued in connection with extensions of trade credit by any Grantor in
the ordinary course of business), excluding any Excluded Assets.

 

4

 

“Pledged
Securities”:  means any Instruments,
Certificated Securities, Chattel Paper and Investment Property.

 

“Pledged
Stock”:  the shares of Capital Stock
listed on Schedule 2, together with any other shares, stock certificates,
options, interests or rights of any nature whatsoever in respect of the Capital
Stock of any Person that may be issued or granted to, or held by, any Grantor
while this Agreement is in effect, excluding any Excluded Assets; provided
that in no event shall more than 65% of the total outstanding Foreign Subsidiary
Voting Stock of any Foreign Subsidiary be required to be pledged hereunder.

 

“Proceeds”:  all “proceeds” as such term is defined in Section 9-102(a)(64)
of the New York UCC and, in any event, shall include, without limitation, all
dividends or other income from the Investment Property, collections thereon or
distributions or payments with respect thereto.

 

“Receivable”:  any right to payment for goods sold or leased
or for services rendered, whether or not such right is evidenced by an
Instrument or Chattel Paper and whether or not it has been earned by
performance (including, without limitation, any Account).

 

“Registered
Intellectual Property”:  all
registrations and applications for registration of Trademarks, Patents and
Copyrights.

 

“Secured
Parties”: the collective reference to the Lenders and the Agents.

 

“Securities
Act”:  the Securities Act of 1933, as
amended.

 

“Subsidiary
Guarantor”:  each Grantor other than
Parent, Holdings and the Borrower.

 

“Trademarks”:  (i) all trademarks, trade names, brand
names, corporate names, company names, business names, fictitious business
names, trade styles, trade dress, domain names, service marks, logos and other
source or business identifiers, and all goodwill associated therewith or
symbolized thereby, now existing or hereafter adopted or acquired, all
registrations thereof, and all applications in connection therewith, whether in
the United States Patent and Trademark Office or in any similar office or
agency of the United States, any State thereof or any group of countries, other
country or any political subdivision thereof, or otherwise, and all common-law
rights related thereto, including, without limitation, any of the foregoing
listed in Schedule 5, and (ii) the right to obtain all renewals thereof.

 

“Trademark
License”:  any written or oral
agreement providing for the grant by or to any Grantor of any right to use any
Trademark, including, without limitation, any of the foregoing listed in
Schedule 5, but excluding the Excluded Assets.

 

“Vehicles”:  all cars, trucks, trailers, construction and
earth moving equipment and other vehicles covered by a certificate of title law
of any state and all tires and other appurtenances to any of the foregoing.

 

5

 

1.2           Other Definitional
Provisions.  (a) 
The words “hereof,” “herein”, “hereto” and “hereunder” and words of similar
import when used in this Agreement shall refer to this Agreement as a whole as
amended from time to time and not to any particular provision of this
Agreement, and Section and Schedule references are to this Agreement
unless otherwise specified.

 

(b)           The meanings given to terms defined
herein shall be equally applicable to both the singular and plural forms of
such terms.

 

(c)           Where the context requires, terms
relating to the Collateral or any part thereof, when used in relation to a
Grantor, shall refer to such Grantor’s Collateral or the relevant part thereof.

 

SECTION 2.  GUARANTEE

 

2.1           Guarantee.  (a)  Each of the Guarantors hereby,
jointly and severally, unconditionally and irrevocably, guarantees to the
Administrative Agent, for the ratable benefit of the Secured Parties, and their
respective successors, indorsees, transferees and assigns, the prompt and
complete payment and performance by the Borrower when due (whether at the
stated maturity, by acceleration or otherwise) of the Borrower Obligations.

 

(b)           Anything herein or in any other Loan
Document to the contrary notwithstanding, the maximum liability of each
Guarantor hereunder and under the other Security Documents and the maximum
amount which may be secured by the Liens granted with respect to the Collateral
hereunder and the Collateral under the other Security Documents, in each case,
shall in no event exceed the amount which can be guaranteed by such Guarantor,
or secured by assets of such Guarantor, under applicable federal and state laws
relating to the insolvency of debtors (after giving effect to the right of
contribution established in Section 2.2).

 

(c)           Each Guarantor agrees that the Borrower
Obligations may at any time and from time to time exceed the amount of the
liability of such Guarantor hereunder without impairing the guarantee contained
in this Section 2 or affecting the rights and remedies of the
Administrative Agent or any Secured Party hereunder.

 

(d)           The guarantee contained in this Section 2
shall remain in full force and effect until all of the Borrower Obligations and
the obligations of each Guarantor under the guarantee contained in this Section 2
shall have been satisfied by payment in full and the Commitments shall be
terminated.

 

(e)           No payment made by the Borrower, any of
the Guarantors, any other guarantor or any other Person or received or
collected by the Administrative Agent or any Secured Party from the Borrower,
any of the Guarantors, any other guarantor or any other Person by virtue of any
action or proceeding or any set-off or appropriation or application at any time
or from time to time in reduction of or in payment of the Borrower Obligations
shall be deemed to modify, reduce, release or otherwise affect the liability of
any Guarantor hereunder which shall, notwithstanding any such payment (other
than any payment made by such Guarantor in respect of the Borrower Obligations
or any payment received or collected from such Guarantor in respect of the
Borrower Obligations), remain liable for the Borrower Obligations up to the
maximum liability of such Guarantor hereunder until the Borrower Obligations
are paid in full and the Commitments are terminated.

 

6

 

2.2           Right of Contribution.  Each Subsidiary Guarantor hereby agrees that
to the extent that a Subsidiary Guarantor shall have paid more than its
proportionate share of any payment made hereunder, such Subsidiary Guarantor
shall be entitled to seek and receive contribution from and against any other
Subsidiary Guarantor hereunder which has not paid its proportionate share of
such payment.  Each Subsidiary Guarantor’s
right of contribution shall be subject to the terms and conditions of Section 2.3.  The provisions of this Section 2.2 shall
in no respect limit the obligations and liabilities of any Subsidiary Guarantor
to the Administrative Agent and the Secured Parties, and each Subsidiary
Guarantor shall remain liable to the Administrative Agent and the Secured
Parties for the full amount guaranteed by such Subsidiary Guarantor hereunder.

 

2.3           No Subrogation.  Notwithstanding any payment made by any
Guarantor hereunder or any set-off or application of funds of any Guarantor by
the Administrative Agent or any Secured Party, no Guarantor shall be entitled
to be subrogated to any of the rights of the Administrative Agent or any
Secured Party against the Borrower or any other Guarantor or any collateral
security or guarantee or right of offset held by the Administrative Agent or
any Secured Party for the payment of the Borrower Obligations, nor shall any
Guarantor seek or be entitled to seek any contribution or reimbursement from
the Borrower or any other Guarantor in respect of payments made by such
Guarantor hereunder, until all amounts owing to the Administrative Agent and
the Secured Parties by the Borrower on account of the Borrower Obligations are
paid in full and the Commitments are terminated.  If any amount shall be paid to any Guarantor
on account of such subrogation rights at any time when all of the Borrower
Obligations shall not have been paid in full, such amount shall be held by such
Guarantor in trust for the Administrative Agent and the Secured Parties, segregated
from other funds of such Guarantor, and shall, forthwith upon receipt by such
Guarantor, be turned over to the Administrative Agent in the exact form
received by such Guarantor (duly indorsed by such Guarantor to the
Administrative Agent, if required), to be applied against the Borrower
Obligations, whether matured or unmatured, in such order as the Administrative
Agent may determine.

 

2.4           Amendments, etc. with
respect to the Borrower Obligations.  Each Guarantor shall remain obligated
hereunder notwithstanding that, without any reservation of rights against any
Guarantor and without notice to or further assent by any Guarantor, any demand
for payment of any of the Borrower Obligations made by the Administrative Agent
or any Secured Party may be rescinded by the Administrative Agent or such
Secured Party and any of the Borrower Obligations continued, and the Borrower
Obligations, or the liability of any other Person upon or for any part thereof,
or any collateral security or guarantee therefor or right of offset with
respect thereto, may, from time to time, in whole or in part, be renewed,
extended, amended, modified, accelerated, compromised, waived, surrendered or
released by the Administrative Agent or any Secured Party, and the Credit
Agreement and the other Loan Documents and any other documents executed and
delivered in connection therewith may be amended, modified, supplemented or
terminated, in whole or in part, as the Administrative Agent (or the Required
Lenders or all Lenders, as the case may be) may deem advisable from time to
time, and any collateral security, guarantee or right of offset at any time
held by the Administrative Agent or any Secured Party for the payment of the
Borrower Obligations may be sold, exchanged, waived, surrendered or
released.  Neither the Administrative
Agent nor any Secured Party shall have any obligation to protect, secure,
perfect or insure any Lien at any time held by it as security for the Borrower
Obligations or for the guarantee contained in this Section 2 or any
property subject thereto.

 

7

 

2.5           Guarantee Absolute and
Unconditional.  Each
Guarantor waives any and all notice of the creation, renewal, extension or
accrual of any of the Borrower Obligations and notice of or proof of reliance
by the Administrative Agent or any Secured Party upon the guarantee contained
in this Section 2 or acceptance of the guarantee contained in this Section 2;
the Borrower Obligations, and any of them, shall conclusively be deemed to have
been created, contracted or incurred, or renewed, extended, amended or waived,
in reliance upon the guarantee contained in this Section 2; and all
dealings between the Borrower and any of the Guarantors, on the one hand, and
the Administrative Agent and the Secured Parties, on the other hand, likewise
shall be conclusively presumed to have been had or consummated in reliance upon
the guarantee contained in this Section 2. 
Each Guarantor waives diligence, presentment, protest, demand for
payment and notice of default or nonpayment to or upon the Borrower or any of
the Guarantors with respect to the Borrower Obligations to the extent permitted
by law.  Each Guarantor understands and
agrees that the guarantee contained in this Section 2 shall be construed
as a continuing, absolute and unconditional guarantee of payment without regard
to (a) the validity or enforceability of the Credit Agreement or any other
Loan Document, any of the Borrower Obligations or any other collateral security
therefor or guarantee or right of offset with respect thereto at any time or
from time to time held by the Administrative Agent or any Secured Party, (b) any
defense, set-off or counterclaim (other than a defense of payment or
performance) which may at any time be available to or be asserted by the
Borrower or any other Person against the Administrative Agent or any Secured
Party, or (c) any other circumstance whatsoever (with or without notice to
or knowledge of the Borrower or such Guarantor) which constitutes, or might be
construed to constitute, an equitable or legal discharge of the Borrower for
the Borrower Obligations, or of such Guarantor under the guarantee contained in
this Section 2, in bankruptcy or in any other instance.  When making any demand hereunder or otherwise
pursuing its rights and remedies hereunder against any Guarantor, the
Administrative Agent or any Secured Party may, but shall be under no obligation
to, make a similar demand on or otherwise pursue such rights and remedies as it
may have against the Borrower, any Guarantor or any other Person or against any
collateral security or guarantee for the Borrower Obligations or any right of
offset with respect thereto, and any failure by the Administrative Agent or any
Secured Party to make any such demand, to pursue such other rights or remedies
or to collect any payments from the Borrower, any Guarantor or any other Person
or to realize upon any such collateral security or guarantee or to exercise any
such right of offset, or any release of the Borrower, any Guarantor or any
other Person or any such collateral security, guarantee or right of offset,
shall not relieve any Guarantor of any obligation or liability hereunder, and
shall not impair or affect the rights and remedies, whether express, implied or
available as a matter of law, of the Administrative Agent or any Secured Party
against any Guarantor.  For the purposes
hereof “demand” shall include the commencement and continuance of any legal
proceedings.

 

2.6           Reinstatement.  The guarantee contained in this Section 2
shall continue to be effective, or be reinstated, as the case may be, if at any
time payment, or any part thereof, of any of the Borrower Obligations is
rescinded or must otherwise be restored or returned by the Administrative Agent
or any Secured Party upon the insolvency, bankruptcy, dissolution, liquidation
or reorganization of the Borrower or any Guarantor, or upon or as a result of
the appointment of a receiver, intervenor or conservator of, or trustee or
similar officer for, the Borrower or any Guarantor or any substantial part of
its property, or otherwise, all as though such payments had not been made.

 

2.7           Payments.  Each Guarantor hereby guarantees that
payments hereunder will be paid to the Administrative Agent without set-off or
counterclaim, in immediately 

 

8

 

available
funds in the currency in which the relevant Obligation is denominated, at the
applicable Payment Office.

 

SECTION 3.  GRANT OF SECURITY INTEREST

 

(a)           Each Grantor hereby grants to the
Administrative Agent, for the ratable benefit of the Secured Parties, a
security interest (the priority of which shall be as set forth in the
Intercreditor Agreement) in all of the following property now owned or at any
time hereafter acquired by such Grantor or in which such Grantor now has or at
any time in the future may acquire any right, title or interest (collectively,
the “Collateral”), as collateral security for the prompt and complete
payment and performance when due (whether at the stated maturity, by
acceleration or otherwise) of such Grantor’s Obligations:

 

(i)            all Accounts;

 

(ii)           all Chattel Paper;

 

(iii)          all
Deposit Accounts;

 

(iv)          all Documents;

 

(v)           all Equipment;

 

(vi)          all Fixtures;

 

(vii)         all
General Intangibles;

 

(viii)        all
Instruments;

 

(ix)           all Intellectual Property;

 

(x)            all Inventory;

 

(xi)           all Investment Property;

 

(xii)          all
other personal property not otherwise described above;

 

(xiii)         all
books and records pertaining to the Collateral; and

 

(xiv)        to
the extent not otherwise included, all Proceeds, Supporting Obligations and
products of any and all of the foregoing and all collateral security and
guarantees given by any Person with respect to any of the foregoing.

 

Notwithstanding the foregoing, (i) the Collateral
shall not include the Excluded Assets and (ii) the Partnership Parks
Entities and their Property and any other Property of Parent and its
Subsidiaries subject to the Partnership Parks Agreements shall be expressly
excluded from, and shall not be subject to, any provisions of this Agreement so
long as the creation of a security interest under, or the execution of, this
Agreement is prohibited by a Contractual Obligation binding on the Partnership
Park Entities or, with respect to any other Property of Parent and its
Subsidiaries, is prohibited by the Partnership Parks Agreements.

 

9

 

(b)           Notwithstanding anything herein to the
contrary, it is the understanding of the parties hereto that the Liens granted
pursuant to Section 3(a) herein shall, prior to the First Priority
Obligations Payment Date (under and as defined in the Intercreditor Agreement),
be subject and subordinate to the Liens granted to the First Lien
Administrative Agent, for the ratable benefit of the Secured Parties (under and
as defined in the First Lien Credit Documents), to secure the First Priority
Obligations (under and as defined in the Intercreditor Agreement).  All other rights and remedies of the
Administrative Agent and the other Secured Parties are further subject to the
provisions of the Intercreditor Agreement.

 

SECTION 4.   
REPRESENTATIONS AND WARRANTIES

 

To induce the
Administrative Agent and the Lenders to enter into the Credit Agreement and to
induce the Lenders to make their respective extensions of credit to the
Borrower thereunder, each Grantor hereby represents and warrants to the
Administrative Agent and each Secured Party that:

 

4.1           Investment Property.  (a)  The shares of Pledged Stock pledged
by such Grantor hereunder constitute all the issued and outstanding shares of
all classes of the Capital Stock of each Issuer owned by such Grantor or, in
the case of Foreign Subsidiary Voting Stock, 65% of the outstanding Foreign
Subsidiary Voting Stock of each relevant Issuer.

 

(b)           All the shares of the Pledged Stock
issued by each Issuer (other than any Issuer that is a Foreign Subsidiary, a
partnership or a limited liability company) have been duly and validly issued
and are fully paid and nonassessable.

 

(c)           Each of the Pledged Notes, to the
knowledge of the Grantors, constitutes the legal, valid and binding obligation
of the obligor with respect thereto, enforceable in accordance with its terms,
subject to the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors’ rights generally, general equitable principles (whether considered
in a proceeding in equity or at law) and an implied covenant of good faith and
fair dealing.

 

(d)           Such Grantor is the record and beneficial
owner of, and has good and marketable title to, the Investment Property pledged
by it hereunder, free of any and all Liens or options in favor of, or claims
of, any other Person, except the security interest created by the First Lien
Guarantee and Collateral Agreement and this Agreement.

 

4.2           Intellectual Property.  (a) Schedule 5 lists all (i) Registered
Intellectual Property owned by such Grantor in its own name on the date hereof
and (ii) all material Registered Intellectual Property exclusively
licensed by such Grantor as of the date hereof, noting in each case the
relevant registration, application or serial number, the jurisdiction of
registration or application, and, in the case of (ii), the title of the
license, the counterparty to such license and the date of such license,
provided that with respect to the foregoing clause (ii), the applicable
Registered Intellectual Property is identified in the applicable license.

 

(b)           Except as set forth in Schedule 5 and
except for joint marketing and sponsorship agreements entered into by such
Grantor in the ordinary course of its business, on the date hereof, none of the
Intellectual Property is the subject of any licensing or franchise agreement
pursuant to which such Grantor is the licensor or franchisor.

 

10

 

(c)           Such Grantor owns, or is licensed to use, all
Intellectual Property material to the conduct of its business as currently
conducted, free and clear of all Liens other than Permitted Liens, and
takes reasonable actions to protect, preserve and maintain such Intellectual
Property except as permitted by Sections 7.5(c)(i) and (c)(xvi) of the
Credit Agreement.  Except as could not reasonably be expected to
have a Material Adverse Effect, (i) all such Intellectual Property is
valid and enforceable and (ii) all Registered Intellectual Property has
not expired or been abandoned except as permitted by Sections 7.5(c)(i) and
(c)(xvi) of the Credit Agreement.   No claim, action or proceeding is pending by
any Person or, to the knowledge of such Grantor, threatened, or
imminent, on the date hereof, and no holding, decision or judgment has been
rendered by any Governmental Authority or arbitrator, which may limit, cancel
or challenge the validity, enforceability, ownership or use of, any material
Intellectual Property in any material respect, except for claims, actions, proceedings, holdings, decisions or
judgments which, individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect. 
To the knowledge of such Grantor, (i) the operation of the business
of such Grantor does not Infringe the Intellectual Property rights of any
Person, and (ii) no Person is Infringing any Intellectual Property owned
by such Grantor to an extent which could reasonably be expected to have a
Material Adverse Effect.

 

(d)           Commercial Tort Claims.  On the date hereof, no Grantor has rights in
any Commercial Tort Claim with potential value in excess of $100,000.

 

4.3           Additional Representations and
Warranties.

 

(a)           On
the date of this Agreement, such Grantor’s jurisdiction of organization,
identification number from the jurisdiction of organization (if any) and the
location of such Grantor’s chief executive office or sole place of business or
principal residence, as the case may be, are specified on Schedule 4.  Such Grantor has furnished to the
Administrative Agent a certified charter, certificate of incorporation or other
organization document and good standing certificate as of a date which is
recent to the date hereof.

 

(b)           Each
Grantor has good and valid rights in and title to the Collateral with respect
to which it has purported to grant a security interest hereunder and has full
power and authority to grant to the Administrative Agent a security interest in
such Collateral pursuant hereto and to execute, deliver and perform its
obligations in accordance with the terms of this Agreement, without the consent
or approval of any other Person other than any consent or approval that has
been obtained and is in full force and effect.

 

(c)           The
UCC financing statements (including fixture filings, as applicable) or other
appropriate filings, recordings or registrations for filing in each
governmental, municipal or other office specified in Schedule 3 hereto, and
with respect to Collateral consisting of registered and applied for United
States Patents, Trademarks, or Copyrights, to the extent required by applicable
Federal law, filings made at the United States Patent and Trademark Office and
the United States Copyright Office, as applicable, are all the filings, recordings
and registrations that are necessary to establish a legal, valid and perfected
security interest in favor of the Administrative Agent (for the benefit of the
Secured Parties) in respect of all Collateral in which a security interest may
be perfected by filing, recording or registration in the United States (or any
political subdivision thereof) and its territories and possessions, and no
further or subsequent filing, refiling, recording, rerecording, registration or
reregistration is necessary in any such 

 

11

 

jurisdiction, except as provided under applicable law
with respect to the filing of continuation statements.

 

(d)           The
security interest granted to the Administrative Agent constitutes (i) a
legal and valid security interest in all the Collateral securing the payment
and performance of the Obligations and (ii) subject to the filings
described in Section 4.4(c), a perfected security interest in all
Collateral in which a security interest may be perfected by filing, recording
or registering a financing statement or analogous document in the United States
(or any political subdivision thereof) and its territories and possessions
pursuant to the Uniform Commercial Code in the relevant jurisdiction. The
security interest granted to the Administrative Agent is and shall be, subject
to the terms of the Intercreditor Agreement, prior to any other Lien on any of
the Collateral, other than Liens expressly permitted under the Credit
Agreement.

 

(e)           The
Collateral is owned by the Grantors free and clear of any Lien, except for
Permitted Liens under the Credit Agreement. 
None of the Grantors has filed or consented to the filing of (i) any
financing statement or analogous document under the New York UCC or any other
applicable laws covering any Collateral or (ii) any assignment in which
any Grantor assigns any Collateral or any security agreement or similar
instrument covering any Collateral with any foreign governmental, municipal or
other office, which financing statement or analogous document, assignment,
security agreement or similar instrument is still in effect, except, in each
case, for Liens expressly permitted under the Credit Agreement, or those which
are for notice purposes only.

 

SECTION 5. 
COVENANTS

 

Each Grantor
covenants and agrees with the Administrative Agent and the Secured Parties
that, from and after the date of this Agreement until the Obligations shall
have been paid in full (other than contingent indemnification obligations not
yet accrued and payable), and the Commitments shall have terminated:

 

5.1           Delivery of Pledged Securities.

 

(a)           Subject
to Section 5.1(f), each Grantor agrees promptly to deliver or cause to be
delivered to the First Lien Administrative Agent or the Administrative Agent for
the benefit of the Secured Parties, as applicable, in accordance with the terms
of the Intercreditor Agreement, any and all Pledged Securities (other than any
uncertificated Capital Stock, but only for so long as such Capital Stock
remains uncertificated) to the extent such Pledged Securities, in the case of
promissory notes or other instruments evidencing Indebtedness, are required to
be delivered pursuant to paragraph (b) of this Section 5.1 (it being
understood that with respect to Reino Aventura, S.A. De C.V. and Ventas Y
Servicios Al Consumidor, S.A. De C.V., such Pledged Securities shall be
delivered within 30 days following the Closing Date (or such later date as
consented to by the Administrative Agent in its reasonable discretion)).

 

(b)           Each
Grantor will cause (i) any Indebtedness for borrowed money (other than
intercompany loans referred to in clause (ii) below) having an aggregate
principal amount in excess of $1,000,000 owed to such Grantor by any Person and
(ii) any intercompany loans made by such Grantor to any Person that is not
a Loan Party to be evidenced by a duly executed promissory note (or pursuant to
a global note) that is pledged and delivered to the First Lien Administrative
Agent or the Administrative Agent, for the benefit of the Secured Parties, as 

 

12

 

applicable, in accordance with the terms of the
Intercreditor Agreement, pursuant to the terms hereof.

 

(c)           Upon
delivery to the First Lien Administrative Agent or the Administrative Agent, as
applicable, in accordance with the terms of the Intercreditor Agreement, (i) any
Pledged Securities shall be accompanied by stock powers duly executed in blank
or other instruments of transfer reasonably satisfactory to the First Lien
Administrative Agent or the Administrative Agent, as applicable, in accordance
with the terms of the Intercreditor Agreement, and by such other instruments
and documents as the First Lien Administrative Agent or the Administrative
Agent, as applicable, in accordance with the terms of the Intercreditor
Agreement, may reasonably request and (ii) all other property comprising
part of the Pledged Securities shall be accompanied by proper instruments of
assignment duly executed by the applicable Grantor and such other instruments
or documents as the First Lien Administrative Agent or the Administrative
Agent, as applicable, in accordance with the terms of the Intercreditor
Agreement, may reasonably request.  Each
delivery of Pledged Securities shall be accompanied by a schedule describing
such Pledged Securities, which schedule shall be attached hereto as Schedule 2
and made a part hereof; provided that failure to attach any such
schedule hereto shall not affect the validity of such pledge of such Pledged
Securities.  Each schedule so delivered
shall supplement any prior schedules so delivered.

 

(d)           Subject
to the terms of the Intercreditor Agreement, at any time and from time to time,
upon the written request of the Administrative Agent, and at the sole expense
of such Grantor, such Grantor will promptly and duly execute and deliver, and
have recorded, such further instruments and documents and take such further
actions as the Administrative Agent may reasonably request for the purpose of
obtaining or preserving the full benefits of this Agreement and of the rights
and powers herein granted, including, without limitation, (i) filing any
financing or continuation statements under the Uniform Commercial Code (or
other similar laws) in effect in any jurisdiction with respect to the security
interests created hereby and (ii) in the case of Investment Property,
Deposit Accounts, Letter-of-Credit Rights and any other relevant Collateral,
taking any actions necessary to enable the Administrative Agent to obtain “control”
(within the meaning of the applicable Uniform Commercial Code) with respect
thereto.

 

(e)           In
the case of each Grantor which is an Issuer, such Issuer agrees that (i) it
will be bound by the terms of this Agreement relating to the Investment
Property issued by it and will comply with such terms insofar as such terms are
applicable to it, (ii) it will notify the Administrative Agent promptly in
writing of the occurrence of any of the events described in Section 5.4(b) with
respect to the Investment Property issued by it and (iii) the terms of
Sections 6.2(d) and 6.7 shall apply to it, mutatis  mutandis,
with respect to all actions that may be required of it pursuant to Section 6.2(d) or
6.7 with respect to the Investment Property issued by it.

 

(f)            Notwithstanding any
of the foregoing or any other provisions of this Agreement, the parties hereto
acknowledge and agree that the First Lien Administrative Agent, for the ratable
benefit of the Secured Parties (under and as defined in the First Lien Credit
Documents), has a prior security interest in the Collateral and that
certificates, instruments and documents representing or evidencing the
Collateral are required to be delivered to and held by the First Lien
Administrative Agent under the applicable First Lien Credit Documents, subject
to Section 2.3(c) of the Intercreditor Agreement, and such delivery
to the First Lien Administrative Agent under the applicable First Lien Credit
Documents shall be deemed to satisfy any requirement for such delivery to the
Administrative Agent under this Agreement until the First

 

13

 

Priority Obligations Payment Date (as defined in the Intercreditor
Agreement) shall have occurred.

 

5.2           Intellectual Property.  (a) Except as permitted by Sections 7.5(c)(i) and
(c)(xvi) of the Credit Agreement, such Grantor (either itself or through
licensees) will (i) continue to use each Material Trademark in order to
maintain such Material Trademark in full force free from any claim of
abandonment for non-use, (ii) maintain in all material respects as in the
past the quality of all products and services offered under any Material
Trademark, (iii) use each Material Trademark with all appropriate notices
of registration and all other notices and legends required by applicable
Requirements of Law, (iv) not adopt or use any new mark, or any mark which
is confusingly similar or a colorable imitation of a Trademark included in the
Collateral unless the Administrative Agent, for the ratable benefit of the
Secured Parties, shall obtain a perfected security interest in such mark
pursuant to this Agreement, and (v) not (and will use commercially
reasonable efforts to prohibit any licensee or sublicensee thereof to) do any
act or knowingly omit to do any act whereby a Material Trademark could
reasonably be expected to become invalidated or diluted in any way, except, in
each case, as could not reasonably be expected to have a Material Adverse
Effect.

 

(b)           Except
as permitted by Sections 7.5(c)(i) and (c)(xvi) of the Credit Agreement,
such Grantor will not do any act, or omit to do any act (and will use
commercially reasonable efforts to ensure that any licensee or sublicensee does
not do any act or omit to do any act) whereby any material Patent included in
the Collateral is abandoned or dedicated to the public, or allowed to
prematurely lapse.

 

(c)           Such
Grantor will not do any act or knowingly omit to do any act (and will use
commercially reasonable efforts to ensure that any licensee or sublicensee does
not do any act or omit to do any act) whereby any material portion of the
Copyrights included in the Collateral could reasonably be expected to become
invalidated or otherwise materially impaired. 
Such Grantor will not do any act (and will use commercially reasonable
efforts to ensure that any licensee or sublicensee does not do any act) whereby
a material portion of any Copyright included in the Collateral falls into the
public domain.

 

(d)           Such
Grantor will not (and will use commercially reasonable efforts to ensure that
any licensee or sublicense does not) knowingly Infringe in any material respect
upon the intellectual property rights of any other Person.

 

(e)           Such
Grantor will notify the Administrative Agent in the next Compliance Certificate
required to be delivered by it pursuant to Section 6.1(f) of the
Credit Agreement if it knows, or has reason to know, that any material
Registered Intellectual Property may become forfeited, abandoned or dedicated
to the public, or of any adverse determination or development (including, without
limitation, the institution of, or any such determination or development in,
any proceeding in the United States Patent and Trademark Office, the United
States Copyright Office or any similar office or agency, or any court or
tribunal in any country) regarding such Grantor’s rights in, or the validity,
enforceability, ownership or use of, any material Intellectual Property,
including, without limitation, such Grantor’s right to register or maintain
same.

 

(f)            Whenever
such Grantor, either by itself or through any agent, employee, licensee or
designee, shall acquire, become the exclusive licensee of, or file an
application for the registration of, any Registered Intellectual Property with
the United States Copyright Office or 

 

14

 

the United States Patent and Trademark Office, or any
similar office or agency in any group of countries, other country or any
political subdivision thereof, such Grantor shall report such filing to the
Administrative Agent on the first Compliance Certificate delivered pursuant to Section 6.1(f) of
the Credit Agreement after such acquisition, licensing, or filing.  Upon request of the Administrative Agent,
such Grantor shall execute and deliver, and have recorded, any and all agreements,
instruments, documents, and papers as the Administrative Agent may reasonably
request to evidence the Administrative Agent’s and the Secured Parties’
security interest in any Registered Intellectual Property which is not an
Excluded Asset.

 

(g)           Such
Grantor will take such actions as it reasonably deems appropriate under the
circumstances, to maintain and pursue each application (and to obtain the
relevant registration) and to maintain each registration of all Registered
Intellectual Property, including, without limitation, filing of applications
for renewal, affidavits of use and affidavits of incontestability.

 

(h)           In
the event that any material Intellectual Property is Infringed by a third
party, such Grantor shall (i) take such actions as such Grantor shall
reasonably deem appropriate under the circumstances to protect such
Intellectual Property and (ii) if such Intellectual Property is of
material economic value to the Grantors as a whole, promptly notify the
Administrative Agent after it learns thereof and, after taking reasonable and
customary measures to stop such Infringement and where appropriate in such
Grantor’s reasonable business judgment, sue for Infringement, seek injunctive
relief and to recover any and all damages for such Infringement.

 

5.3           Additional Covenants.

 

(a)           The
Borrower agrees, on its own behalf and on behalf of each Grantor, to notify the
Administrative Agent in writing of any change (i) in legal name of any
Grantor, (ii) in the identity or type of organization or corporate structure
of any Grantor, or (iii) in the jurisdiction of organization of any
Grantor, within 15 days of any such change.

 

(b)           Each
Grantor shall, at its own expense, take any and all commercially reasonable
actions necessary to defend title to the Collateral against all Persons and to
defend the security interest of the Administrative Agent in the Collateral and
the priority thereof against any Lien not expressly permitted by the Credit
Agreement.

 

(c)           Subject
to the terms of the Intercreditor Agreement, the Borrower agrees, on its own
behalf and on behalf of each other Grantor, at its own expense, to execute,
acknowledge, deliver and cause to be duly filed all such further instruments
and documents and take all such actions as the Administrative Agent may from
time to time reasonably request to better assure, preserve, protect and perfect
its security interest and the rights and remedies created hereby, including the
payment of any fees and taxes required in connection with the execution and
delivery of this Agreement, the granting to the Administrative Agent of a
security interest and the filing of any financing statements (including fixture
filings) or other documents in connection herewith or therewith.  If any amount payable under or in connection
with any of the Collateral that is in excess of $1,000,000 shall be or become
evidenced by any promissory note or other instrument, such note or instrument
shall be promptly pledged and delivered to the Administrative Agent, for the
benefit of the Secured Parties, duly endorsed in a manner reasonably
satisfactory to the Administrative Agent.

 

15

 

(d)           At
its option, the Administrative Agent may discharge past due taxes, assessments,
charges, fees, Liens, security interests or other encumbrances at any time
levied or placed on the Collateral and not permitted under the Credit
Agreement, and may pay for the maintenance and preservation of the Collateral
to the extent any Grantor fails to do so as required by the Credit Agreement or
this Agreement and within a reasonable period of time after the Administrative
Agent has requested that it do so, and each Grantor jointly and severally
agrees to reimburse the Administrative Agent within 10 days after demand for
any payment made or any reasonable expense incurred by the Administrative Agent
pursuant to the foregoing authorization. 
Nothing in this paragraph shall be interpreted as excusing any Grantor
from the performance of, or imposing any obligation on the Administrative Agent
or any Secured Party to cure or perform, any covenants or other promises of any
Grantor with respect to taxes, assessments, charges, fees, Liens, security
interests or other encumbrances and maintenance as set forth herein, in the
other Loan Documents.

 

(e)           If
at any time any Grantor shall take a security interest in any property of any
Person who is or who may become obligated to any Grantor under, with respect to
or on account of an Account (an “Account Debtor”), or any other Person,
the value of which is in excess of $1,000,000, to secure payment and
performance of an Account, such Grantor shall promptly assign such security
interest to the Administrative Agent for the benefit of the Secured
Parties.  Such assignment need not be
filed of public record unless necessary to continue the perfected status of the
security interest against creditors of and transferees from the Account Debtor
or other Person granting the security interest.

 

(f)            Each
Grantor (rather than the Administrative Agent or any Secured Party) shall
remain liable (as between itself and any relevant counterparty) to observe and
perform all the material conditions and obligations to be observed and
performed by it under each contract, agreement or instrument relating to the
Collateral, all in accordance with the terms and conditions thereof, and each
Grantor jointly and severally agrees to indemnify and hold harmless the
Administrative Agent and the Secured Parties from and against any and all
liability for such performance; provided, that no Grantor shall have any
obligation hereunder to the Administrative Agent or any Secured Party with
respect to any such liabilities to the extent such liabilities are found by a
final and non-appealable decision of a court of competent jurisdiction to have resulted
from the gross negligence or willful misconduct of the Administrative Agent or
any Secured Party or of any director, officer, or employee of the
Administrative Agent or any Secured Party.

 

(g)           If
any Grantor shall at any time hold or acquire a Commercial Tort Claim with a
value in excess of $1,000,000, such Grantor shall promptly notify the
Administrative Agent in writing signed by such Grantor of the brief details
thereof and grant to the Administrative Agent a security interest therein and
in the proceeds thereof, all upon the terms of this Agreement pursuant to a
document in form and substance reasonably satisfactory to the Administrative
Agent.

 

(h)           The
aggregate book value of all Vehicles owned by all such Grantors will not exceed
$10,000,000 or such higher book value as shall be reasonably satisfactory to
the Administrative Agent.

 

5.4           Other Actions.  In order to further ensure the attachment,
perfection and priority of, and the ability of the Administrative Agent to
enforce its security interest, each 

 

16

 

Grantor agrees, in each case at such Grantor’s own expense, to take the
following actions with respect to the following Collateral:

 

(a)           Instruments.  If any Grantor shall at any time hold or acquire
any Instruments constituting Collateral and evidencing an amount in excess of
$1,000,000, such Grantor shall forthwith endorse, assign and deliver the same
to the First Lien Administrative Agent or the Administrative Agent for the
benefit of the Secured Parties, as applicable, in accordance with the terms of
the Intercreditor Agreement, accompanied by such instruments of transfer or
assignment duly executed in blank as the First Lien Administrative Agent or the
Administrative Agent, as applicable, in accordance with the terms of the
Intercreditor Agreement, may from time to time reasonably request.

 

(b)           Investment
Property.  If any Grantor shall at
any time hold or acquire any certificated Capital Stock, such Grantor shall
forthwith endorse, assign and deliver the same to the First Lien Administrative
Agent or the Administrative Agent for the benefit of the Secured Parties, as
applicable, in accordance with the terms of the Intercreditor Agreement,
accompanied by such instruments of transfer or assignment duly executed in
blank as the First Lien Administrative Agent or the Administrative Agent, as
applicable, in accordance with the terms of the Intercreditor Agreement, may
from time to time reasonably request.  If
any Capital Stock now or hereafter acquired by any Grantor are uncertificated
and are issued to such Grantor or its nominee directly by the issuer thereof,
such Grantor shall promptly notify the Administrative Agent thereof and, at the
Administrative Agent’s reasonable request and option pursuant to an agreement
in form and substance reasonably satisfactory to the Administrative Agent,
subject to the terms of the Intercreditor Agreement, either (i) cause the
Issuer to agree to comply with instructions from the Administrative Agent as to
such securities, without further consent of any Grantor or such nominee, or (ii) arrange
for the Administrative Agent to become the registered owner of the
securities.  If any Capital Stock,
whether certificated or uncertificated, or other Investment Property are held
by any Grantor or its nominee through a securities intermediary or commodity
intermediary, such Grantor shall promptly notify the Administrative Agent
thereof and at the Administrative Agent’s request and option, pursuant to an
agreement in form and substance reasonably satisfactory to the Administrative
Agent shall, subject to the terms of the Intercreditor Agreement, either (i) cause
such securities intermediary or (as the case may be) commodity intermediary to
agree to comply with entitlement orders or other instructions from the
Administrative Agent to such securities intermediary as to such security
entitlements, or (as the case may be) to apply any value distributed on account
of any commodity contract as directed by the Administrative Agent to such
commodity intermediary, in each case without further consent of any Grantor or
such nominee, or (ii) in the case of financial assets or other Investment
Property held through a securities intermediary, arrange for the Administrative
Agent to become the entitlement holder with respect to such Investment
Property, with the Grantor being permitted, only with the consent of the
Administrative Agent to exercise rights to withdraw or otherwise deal with such
Investment Property.  The Administrative
Agent agrees with each of the Grantors that the Administrative Agent shall not
give any such entitlement orders or instructions or directions to any such
Issuer, securities intermediary or commodity intermediary, and shall not
withhold its consent to the exercise of any withdrawal or dealing rights by any
Grantor, unless an Event of Default has occurred and is continuing.  The provisions of this paragraph shall not
apply to any financial assets credited to a securities account for which the
Administrative Agent is the securities intermediary.

 

17

 

SECTION 6.  REMEDIAL PROVISIONS

 

6.1           Registration in Nominee Name;
Denominations. If an Event of Default shall occur and be continuing,
subject to the terms of the Intercreditor Agreement (a) the Administrative
Agent, on behalf of the Secured Parties, shall have the right (in its sole and
absolute discretion) to hold the Pledged Securities in its own name as pledgee,
the name of its nominee (as pledgee or as sub-agent) or the name of the
applicable Grantor, endorsed or assigned in blank or in favor of the
Administrative Agent, and each Grantor will promptly give to the Administrative
Agent copies of any notices or other communications received by it with respect
to Pledged Securities registered in the name of such Grantor and (b) the
Administrative Agent shall have the right to exchange the certificates
representing Pledged Securities for certificates of smaller or larger
denominations for any purpose consistent with this Agreement.

 

6.2           Voting Rights; Dividends and
Interest.

 

(a)           Unless
and until an Event of Default shall have occurred and be continuing and,
subject to the terms of the Intercreditor Agreement, the Administrative Agent
shall have notified the Borrower that the rights of the Grantors under this Section 6.2
are being suspended:

 

(i)            Each Grantor shall be entitled to
exercise any and all voting and/or other consensual rights and powers inuring
to an owner of Pledged Securities or any part thereof for any purpose consistent
with the terms of this Agreement, the Credit Agreement and the other Loan
Documents; provided that
such rights and powers shall not be exercised in any manner that could
materially and adversely affect the rights inuring to a holder of any Pledged
Securities or the rights and remedies of any of the Administrative Agent or the
other Secured Parties under this Agreement, the Credit Agreement or any other
Loan Document or the ability of the Secured Parties to exercise the same.

 

(ii)           Each Grantor shall be entitled to
receive and retain any and all dividends, interest, principal and other
distributions paid on or distributed in respect of the Pledged Securities to
the extent and only to the extent that such dividends, interest, principal and
other distributions are permitted by, and otherwise paid or distributed in
accordance with, the terms and conditions of the Credit Agreement, the other
Loan Documents and applicable Laws; provided
that any noncash dividends, interest, principal or other distributions, whether
resulting from a subdivision, combination or reclassification of the
outstanding equity interests of the issuer of any Pledged Securities or
received in exchange for Pledged Securities or any part thereof, or in
redemption thereof, or as a result of any merger, consolidation, acquisition or
other exchange of assets to which such issuer may be a party or otherwise,
shall be and become part of the Collateral, and, if received by any Grantor,
shall not be commingled by such Grantor with any of its other funds or property
but shall be held separate and apart therefrom, shall be held in trust for the
benefit of the Administrative Agent and the Secured Parties and shall be
forthwith delivered to the First Lien Administrative Agent or the
Administrative Agent, as applicable, in accordance with the terms of the
Intercreditor Agreement, in the same form as so received (with any necessary
endorsement reasonably requested by the First Lien Administrative Agent or the
Administrative Agent, as applicable, in accordance with the terms of the
Intercreditor Agreement).

 

(b)           Subject
in each case to the terms of the Intercreditor Agreement, upon the occurrence
and during the continuance of an Event of Default, after the Administrative
Agent shall have notified the Borrower of the suspension of the rights of the
Grantors under paragraph 

 

18

 

(a)(ii) of this Section 6.2, then all rights
of any Grantor to dividends, interest, principal or other distributions that
such Grantor is authorized to receive pursuant to paragraph (a)(ii) of
this Section 6.2 shall cease, and all such rights shall thereupon become
vested in the First Lien Administrative Agent or the Administrative Agent, as
applicable, in accordance with the terms of the Intercreditor Agreement, which
shall have the sole and exclusive right and authority to receive and retain
such dividends, interest, principal or other distributions.  All dividends, interest, principal or other
distributions received by any Grantor contrary to the provisions of this Section 6.2
shall be (i) held in trust for the benefit of the First Lien
Administrative Agent or the Administrative Agent, as applicable, in accordance
with the terms of the Intercreditor Agreement, (ii) segregated from other
property or funds of such Grantor and (iii) forthwith delivered to the
First Lien Administrative Agent or the Administrative Agent, as applicable, in
accordance with the terms of the Intercreditor Agreement, in the same form as
so received (with any necessary endorsement reasonably requested by the First
Lien Administrative Agent or the Administrative Agent, as applicable, in
accordance with the terms of the Intercreditor Agreement).  Any and all money and other property paid
over to or received by the First Lien Administrative Agent or the
Administrative Agent, as applicable, in accordance with the terms of the
Intercreditor Agreement, pursuant to the provisions of this paragraph (b) shall
be retained by the First Lien Administrative Agent or the Administrative Agent,
as applicable, in accordance with the terms of the Intercreditor Agreement, in
an account to be established by the First Lien Administrative Agent or the
Administrative Agent, as applicable, in accordance with the terms of the
Intercreditor Agreement, upon receipt of such money or other property and shall
be applied in accordance with the provisions of Section 6.4.  After all Events of Default have been cured
or waived, the First Lien Administrative Agent or the Administrative Agent, as
applicable, in accordance with the terms of the Intercreditor Agreement, shall
promptly repay to each Grantor (without interest) all dividends, interest,
principal or other distributions that such Grantor would otherwise be permitted
to retain pursuant to the terms of paragraph (a)(ii) of this Section 6.2
and that remain in such account.

 

(c)           Subject
to the terms of the Intercreditor Agreement, upon the occurrence and during the
continuance of an Event of Default, after the Administrative Agent shall
have notified the Borrower of the suspension of the rights of the Grantors
under paragraph (a)(i) of this Section 6.2, then all rights of any
Grantor to exercise the voting and consensual rights and powers it is entitled
to exercise pursuant to paragraph (a)(i) of this Section 6.2 shall
cease, and all such rights shall thereupon become vested in
the Administrative Agent, which shall have the sole and exclusive right
and authority to exercise such voting and consensual rights and powers; provided that, unless otherwise
directed by the Required Lenders, the Administrative Agent shall have the
right from time to time following and during the continuance of an Event of
Default to permit the Grantors to exercise such rights.  After all Events
of Default have been cured or waived, each Grantor shall have the exclusive
right to exercise the voting and/or consensual rights and powers that such
Grantor would otherwise be entitled to exercise pursuant to the terms of
paragraph (a)(i) of this Section 6.2.

 

(d)           Each
Grantor hereby authorizes and instructs each Issuer of any Investment Property
pledged by such Grantor hereunder, subject to the terms of the Intercreditor
Agreement, to (i) comply with any instruction received by it from the
Administrative Agent in writing that (x) states that an Event of Default
has occurred and is continuing and (y) is otherwise in accordance with the
terms of this Agreement, without any other or further instructions from such
Grantor, and each Grantor agrees that each Issuer shall be fully protected in
so complying, and (ii) pay any non-cash dividends or other non-cash
payments with respect to 

 

19

 

the Investment Property directly to the Administrative
Agent and, after such Issuer receives notice from the Administrative Agent that
an Event of Default has occurred, pay any cash dividends or other payments with
respect to the Investment Property directly to the Administrative Agent.

 

6.3           Additional Remedies upon Default.

 

(a)           Subject
to the terms of the Intercreditor Agreement, upon the occurrence and during the
continuance of an Event of Default, it is agreed that the Administrative Agent
shall have the right to exercise any and all rights afforded to a Secured Party
with respect to the Obligations under the Uniform Commercial Code or other
applicable law and also may (i) require each Grantor to, and each Grantor
agrees that it will at its expense and upon request of the Administrative Agent
forthwith, assemble all or part of the Collateral as directed by the Administrative
Agent and make it available to the Administrative Agent at a place and time to
be designated by the Administrative Agent; (ii) occupy any premises owned
or, to the extent lawful and permitted, leased by any of the Grantors where the
Collateral or any part thereof is assembled or located for a reasonable period
in order to effectuate its rights and remedies hereunder or under law, without
obligation to such Grantor in respect of such occupation; (iii) exercise
any and all rights and remedies of any of the Grantors under or in connection
with the Collateral, or otherwise in respect of the Collateral, provided
that, with respect to any Collateral consisting of Pledged Stock of any Issuer
that is not a Wholly Owned Subsidiary, such exercise shall be subject to any
limitations or prohibitions of any Contractual Obligations among the holders of
such Issuer’s Capital Stock; and (iv) subject to the mandatory
requirements of applicable law, consent to the use by any Grantor of any cash
collateral arising in respect of the Collateral on such terms as the
Administrative Agent deems reasonable and/or may sell or otherwise dispose of,
or acquire by credit bid on behalf of the Secured Parties, all or any part of
the Collateral securing the Obligations at a public or private sale or at any
broker’s board or on any securities exchange, for cash, upon credit or for
future delivery as the Administrative Agent shall deem appropriate.  The Administrative Agent shall be authorized
at any such sale of securities (if it deems it advisable to do so) to restrict
the prospective bidders or purchasers to Persons who will represent and agree
that they are purchasing the Collateral for their own account for investment
and not with a view to the distribution or sale thereof, and upon consummation
of any such sale the Administrative Agent shall have the right to assign,
transfer and deliver to the purchaser or purchasers thereof the Collateral so
sold.  Each such purchaser at any sale of
Collateral shall hold the property sold absolutely, free from any claim or
right on the part of any Grantor, and each Grantor hereby waives (to the extent
not prohibited by law) all rights of redemption, stay and appraisal which such
Grantor now has or may at any time in the future have under any rule of
law or statute now existing or hereafter enacted.

 

(b)           The
Administrative Agent shall give the applicable Grantors 10 days’ written notice
(which each Grantor agrees is reasonable notice within the meaning of Section 9-611
of the New York UCC or its equivalent in other jurisdictions) of the
Administrative Agent’s intention to make any sale of Collateral.  Such notice, in the case of a public sale,
shall state the time and place for such sale and, in the case of a sale at a
broker’s board or on a securities exchange, shall state the board or exchange
at which such sale is to be made and the day on which the Collateral, or
portion thereof, will first be offered for sale at such board or exchange. Any
such public sale shall be held at such time or times within ordinary business
hours and at such place or places as the Administrative Agent may fix and state
in the notice (if any) of such sale.  At
any such sale, the Collateral, or portion thereof, to be sold may be sold in
one lot as an 

 

20

 

entirety or in separate parcels, as the Administrative
Agent may (in its sole and absolute discretion) determine.  The Administrative Agent shall not be
obligated to make any sale of any Collateral if it shall determine not to do
so, regardless of the fact that notice of sale of such Collateral shall have
been given.  The Administrative Agent
may, without notice or publication, adjourn any public or private sale or cause
the same to be adjourned from time to time by announcement at the time and
place fixed for sale, and such sale may, without further notice, be made at the
time and place to which the same was so adjourned.  In case any sale of all or any part of the
Collateral is made on credit or for future delivery, the Collateral so sold may
be retained by the Administrative Agent until the sale price is paid by the
purchaser or purchasers thereof, but the Administrative Agent shall not incur
any liability in case any such purchaser or purchasers shall fail to take up and
pay for the Collateral so sold and, in case of any such failure, such
Collateral may be sold again upon like notice. 
At any public or private sale made pursuant to this Agreement, any
Secured Party may bid for or purchase, free from any right of redemption, stay,
valuation or appraisal on the part of any Grantor (all said rights being also
hereby waived and released to the extent not prohibited by law), the Collateral
or any part thereof offered for sale and may make payment on account thereof by
using any claim then due and payable to such Secured Party from any Grantor as
a credit against the purchase price, and such Secured Party may, upon
compliance with the terms of sale, hold, retain and dispose of such property
without further accountability to any Grantor therefor.  For purposes hereof, a written agreement to
purchase the Collateral or any portion thereof shall be treated as a sale
thereof; the Administrative Agent shall be free to carry out such sale pursuant
to such agreement and no Grantor shall be entitled to the return of the
Collateral or any portion thereof subject thereto, notwithstanding the fact
that, after the Administrative Agent shall have entered into such an agreement,
all Events of Default shall have been remedied and the Obligations paid in
full.  As an alternative to exercising
the power of sale herein conferred upon it, the Administrative Agent may
proceed by a suit or suits at law or in equity to foreclose this Agreement and
to sell the Collateral or any portion thereof pursuant to a judgment or decree
of a court or courts having competent jurisdiction or pursuant to a proceeding
by a court appointed receiver.  Any sale
pursuant to the provisions of this Section 6.3 shall be deemed to conform
to the commercially reasonable standards as provided in Section 9-610(b) of
the New York UCC or its equivalent in other jurisdictions.

 

6.4           Application of Proceeds.  Subject to the terms of the Intercreditor
Agreement, at such intervals as may be agreed upon by the Borrower and the
Administrative Agent, or, if an Event of Default shall have occurred and be
continuing, at any time at the Administrative Agent’s election, the
Administrative Agent may apply all or any part of Proceeds of any collection or
sale of Collateral, including any Collateral consisting of cash, and any
proceeds of the guarantee set forth in Section 2 in payment of the
Obligations in the following order:

 

First,
to pay incurred and unpaid fees and expenses of the Administrative Agent under
the Loan Documents;

 

Second,
to the Administrative Agent, for application by it towards payment of amounts
then due and owing and remaining unpaid in respect of the Obligations, pro rata
among the Secured Parties according to the amounts of the Obligations then due
and owing and remaining unpaid to the Secured Parties;

 

21

 

Third,
to the Administrative Agent, for application by it towards prepayment of the
Obligations, pro rata among the Lenders according to the amounts of the
Obligations then held by the Lenders, with any such prepayment of Loans being
applied, first, to Base Rate Loans and, second, to Eurocurrency Loans; and

 

Fourth,
any balance of such Proceeds remaining after the Obligations shall have been
paid in full and the Commitments shall have terminated shall be paid over to
the Borrower or to whomsoever may be lawfully entitled to receive the same.

 

6.5           Deficiency.  Each Grantor shall remain liable for any
deficiency if the proceeds of any sale or other disposition of the Collateral
are insufficient to pay its Obligations and the fees and disbursements of any
attorneys employed by the Administrative Agent to collect such deficiency.

 

6.6           Subordination.  Each Grantor hereby agrees that, upon the
occurrence and during the continuance of an Event of Default, unless otherwise
agreed by the Administrative Agent, all Indebtedness owing by it to any
Subsidiary of the Borrower shall be fully subordinated to the indefeasible
payment in full in cash of such Grantor’s Obligations.

 

6.7           Registration Rights.  (a)  Upon the occurrence and during the
continuance of an Event of Default, subject to the terms of the Intercreditor
Agreement (i) if the Loans (with accrued interest thereon) and all other
amounts owing under the Loan Documents have become due and payable in
accordance with the Credit Agreement and (ii) if the Administrative Agent
shall determine to exercise its right to sell any or all of the Pledged Stock
pursuant to Section 6.3, and if in the opinion of the Administrative Agent
it is necessary or advisable to have the Pledged Stock, or that portion thereof
to be sold, registered under the provisions of the Securities Act, the relevant
Grantor will cause the Issuer thereof to (x) execute and deliver, and
cause the directors and officers of such Issuer to execute and deliver, all
such instruments and documents, and do or cause to be done all such other acts
as may be, in the opinion of the Administrative Agent, necessary or advisable
to register the Pledged Stock, or that portion thereof to be sold, under the
provisions of the Securities Act, (y) use its commercially reasonable
efforts to cause the registration statement relating thereto to become
effective and to remain effective for a period of one year from the date of the
first public offering of the Pledged Stock, or that portion thereof to be sold,
and (z) make all amendments thereto and/or to the related prospectus
which, in the opinion of the Administrative Agent, are necessary or advisable,
all in conformity with the requirements of the Securities Act and the rules and
regulations of the Securities and Exchange Commission applicable thereto.  Each Grantor agrees to cause such Issuer to
comply with the provisions of the securities or “Blue Sky” laws of any and all
jurisdictions which the Administrative Agent shall designate and to make
available to its security holders, as soon as practicable, an earnings
statement (which need not be audited) which will satisfy the provisions of Section 11(a) of
the Securities Act.

 

(b)           Each
Grantor recognizes that the Administrative Agent may be unable to effect a
public sale of any or all the Pledged Stock, by reason of certain prohibitions
contained in the Securities Act and applicable state securities laws or
otherwise, and may be compelled to resort to one or more private sales thereof
to a restricted group of purchasers which will be obliged to agree, among other
things, to acquire such securities for their own account for investment and not
with a view to the distribution or resale thereof.  Each Grantor acknowledges and agrees that any
such private sale may result in prices and other terms less favorable than if 

 

22

 

such sale were a public sale and, notwithstanding such
circumstances, agrees that any such private sale shall be deemed to have been
made in a commercially reasonable manner. 
The Administrative Agent shall be under no obligation to delay a sale of
any of the Pledged Stock for the period of time necessary to permit the Issuer
thereof to register such securities for public sale under the Securities Act,
or under applicable state securities laws, even if such Issuer would agree to
do so.

 

(c)           Each
Grantor agrees to use its commercially reasonable efforts to do or cause to be
done all such other acts as may be necessary to make such sale or sales of all
or any portion of the Pledged Stock pursuant to this Section 6.7 valid and
binding and in compliance with any and all other applicable Requirements of
Law.  Each Grantor further agrees that a
breach of any of the covenants contained in this Section 6.7 will cause
irreparable injury to the Administrative Agent and the Secured Parties, that
the Administrative Agent and the Secured Parties have no adequate remedy at law
in respect of such breach and, as a consequence, that each and every covenant
contained in this Section 6.7 shall be specifically enforceable against
such Grantor, and such Grantor hereby waives and agrees not to assert any
defenses against an action for specific performance of such covenants except
for a defense that no Event of Default has occurred and is continuing under the
Credit Agreement.

 

6.8           Grant
of Intellectual Property License. 
During the continuance of an Event of Default, for the purpose of
enabling the Administrative Agent to exercise the rights and remedies under
this Agreement at such time as the Administrative Agent shall be lawfully
entitled to exercise such rights and remedies, each Grantor hereby (a) grants
to the Administrative Agent, for the benefit of the Administrative Agent and
the Secured Parties, a nonexclusive license (exercisable without payment of
royalty or other compensation to any Grantor) to use, license or sublicense any
Intellectual Property now owned or hereafter acquired by such Grantor, and
wherever the same may be located, and including in such license access to all
media in which any of the licensed items may be recorded or stored and to all
computer software and programs used for the compilation or printout thereof,
the right to prosecute and maintain all Intellectual Property included in the
Collateral and the right to sue for past infringement of such Intellectual
Property; and (b) subject to the terms of the Intercreditor Agreement,
agrees that the Administrative Agent may sell any of such Grantor’s Inventory
directly to any person, including without limitation persons who have
previously purchased the Grantor’s Inventory from such Grantor and in
connection with any such sale or other enforcement of the Administrative Agent’s
rights under this Agreement, may sell Inventory which bears any Trademark
included in the Collateral and any Inventory that is covered by any Copyright
included in the Collateral and the Administrative Agent may finish any work in
process and affix any Trademark included in the Collateral and sell such
Inventory as provided herein.

 

SECTION 7.  THE ADMINISTRATIVE AGENT

 

7.1           Administrative Agent’s Appointment
as Attorney-in-Fact, etc.  (a) 
Each Grantor hereby irrevocably constitutes and appoints the Administrative
Agent and any officer or agent thereof, with full power of substitution, as its
true and lawful attorney-in-fact with full irrevocable power and authority in
the place and stead of such Grantor and in the name of such Grantor or in its
own name, for the purpose of carrying out the terms of this Agreement, to take
any and all appropriate action and to execute any and all documents and
instruments which may be necessary or desirable to accomplish the purposes of
this Agreement, and, without limiting the 

 

23

 

generality of the foregoing, each Grantor hereby gives the
Administrative Agent the power and right, on behalf of such Grantor, without
notice to or assent by such Grantor, to do any or all of the following (subject
to the terms of the Intercreditor Agreement):

 

(i)            in the name of such Grantor or its
own name, or otherwise, take possession of and indorse and collect any checks,
drafts, notes, acceptances or other instruments for the payment of moneys due
under any Receivable or with respect to any other Collateral and file any claim
or take any other action or proceeding in any court of law or equity or
otherwise deemed appropriate by the Administrative Agent for the purpose of
collecting any and all such moneys due under any Receivable or with respect to
any other Collateral whenever payable;

 

(ii)           in the case of any Intellectual
Property, execute and deliver, and record 
or have recorded, any and all agreements, instruments, financing
statements, documents and papers as the Administrative Agent may request (A) to
evidence the Administrative Agent’s and the Secured Parties’ security interest
in such Intellectual Property, and (B) to perfect such security interest;

 

(iii)          pay or discharge taxes and Liens
levied or placed on or threatened against the Collateral, effect any repairs or
any insurance called for by the terms of this Agreement and pay all or any part
of the premiums therefor and the costs thereof;

 

(iv)          execute, in connection with the
exercise of any right or remedy provided for in Section 6.3 or 6.7, any
indorsements, assignments or other instruments of conveyance or transfer with
respect to the Collateral; and

 

(v)           (1)  direct any party liable for
any payment under any of the Collateral to make payment of any and all moneys
due or to become due thereunder directly to the Administrative Agent or as the
Administrative Agent shall direct; (2) ask or demand for, collect, and
receive payment of and receipt for, any and all moneys, claims and other
amounts due or to become due at any time in respect of or arising out of any
Collateral; (3) sign and indorse any invoices, freight or express bills,
bills of lading, storage or warehouse receipts, drafts against debtors,
assignments, verifications, notices and other documents in connection with any
of the Collateral; (4) commence and prosecute any suits, actions or
proceedings at law or in equity in any court of competent jurisdiction to
collect the Collateral or any portion thereof and to enforce any other right in
respect of any Collateral; (5) defend any suit, action or proceeding
brought against such Grantor with respect to any Collateral; (6) settle,
compromise or adjust any such suit, action or proceeding and, in connection
therewith, give such discharges or releases as the Administrative Agent may
deem appropriate; (7) assign any Intellectual Property, throughout the
world for such term or terms, on such conditions, and in such manner, as the
Administrative Agent shall in its sole discretion determine; and (8) generally,
sell, transfer, pledge and make any agreement with respect to, or consent to any
use of cash collateral arising in respect of or otherwise deal with, any of the
Collateral as fully and completely as though the Administrative Agent were the
absolute owner thereof for all purposes, and do, at the Administrative Agent’s
option and such Grantor’s expense, at any time, or from time to time, all acts
and things which the Administrative Agent deems necessary to protect, preserve
or realize upon the Collateral and the Administrative Agent’s and the Secured
Parties’ security interests therein and to effect the intent of this Agreement,
all as fully and effectively as such Grantor might do.

 

24

 

Anything in this Section 7.1(a) to
the contrary notwithstanding, the Administrative Agent agrees that it will not
exercise any rights under the power of attorney provided for in this Section 7.1(a) 
(other than any rights set forth in clause (ii) of Section 7.1(a))
unless an Event of Default shall have occurred and be continuing.

 

(b)           If
any Grantor fails to perform or comply with any of its agreements contained
herein, the Administrative Agent, at its option, but without any obligation so
to do, may perform or comply, or otherwise cause performance or compliance,
with such agreement.

 

(c)           The
expenses of the Administrative Agent incurred in connection with actions
undertaken as provided in this Section 7.1, together with interest thereon
at a rate per annum equal to the highest rate per annum at which interest would
then be payable on any category of past due Loans that are Base Rate Loans
under the Credit Agreement, from the date of payment by the Administrative
Agent to the date reimbursed by the relevant Grantor, shall be payable by such
Grantor to the Administrative Agent on demand.

 

(d)           Each
Grantor hereby ratifies all that said attorneys shall lawfully do or cause to
be done by virtue hereof.  Each Secured
Party, by its authorization of the Administrative Agent’s entering into this
Agreement, consents to the exercise by the Administrative Agent of any power,
right or remedy provided for herein.  All
powers, authorizations and agencies contained in this Agreement are coupled
with an interest and are irrevocable until this Agreement is terminated and the
security interests created hereby are released.

 

7.2           Duty
of Administrative Agent.  The
Administrative Agent’s sole duty with respect to the custody, safekeeping and
physical preservation of the Collateral in its possession, under Section 9-207
of the New York UCC or otherwise, shall be to deal with it in the same manner
as the Administrative Agent deals with similar property for its own
account.  Neither the Administrative
Agent, any Secured Party nor any of their respective officers, directors,
employees or agents shall be liable for failure to demand, collect or realize
upon any of the Collateral or for any delay in doing so or shall be under any
obligation to sell or otherwise dispose of any Collateral upon the request of
any Grantor or any other Person or to take any other action whatsoever with
regard to the Collateral or any part thereof unless such failure constitutes
gross negligence, willful misconduct or fraud. 
The powers conferred on the Administrative Agent and the Secured Parties
hereunder are solely to protect the Administrative Agent’s and the Secured
Parties’ interests in the Collateral and shall not impose any duty upon the
Administrative Agent or any Secured Party to exercise any such powers.  The Administrative Agent and the Secured
Parties shall be accountable only for amounts that they actually receive as a
result of the exercise of such powers, and neither they nor any of their
officers, directors, employees or agents shall be responsible to any Grantor
for any act or failure to act hereunder, except for their (or their officers,
directors, employees or agents’) own gross negligence or willful misconduct.

 

7.3           Execution
of Financing Statements.  Pursuant to
any applicable law, each Grantor authorizes the Administrative Agent to file or
record financing statements and other filing or recording documents or
instruments with respect to the Collateral without the signature of such
Grantor in such form and in such offices as the Administrative Agent determines
appropriate to perfect the security interests of the Administrative Agent under
this Agreement.  Each Grantor authorizes the Administrative
Agent to use the collateral description “all personal property” in any such
financing statements.  Each Grantor
hereby ratifies and authorizes the

 

25

 

filing by the Administrative
Agent of any financing statement with respect to the Collateral made prior to
the date hereof.

 

7.4           Authority
of Administrative Agent.  Each
Grantor acknowledges that the rights and responsibilities of the Administrative
Agent under this Agreement with respect to any action taken by the
Administrative Agent or the exercise or non-exercise by the Administrative
Agent of any option, voting right, request, judgment or other right or remedy
provided for herein or resulting or arising out of this Agreement shall, as
between the Administrative Agent and the Secured Parties, be governed by the
Credit Agreement and by such other agreements with respect thereto as may exist
from time to time among them, but, as between the Administrative Agent and the
Grantors, the Administrative Agent shall be conclusively presumed to be acting
as agent for the Secured Parties with full and valid authority so to act or
refrain from acting, and no Grantor shall be under any obligation, or
entitlement, to make any inquiry respecting such authority.

 

SECTION 8. 
MISCELLANEOUS

 

8.1           Amendments in Writing.  None of the terms or provisions of this
Agreement may be waived, amended, supplemented or otherwise modified except in
accordance with Sections 6.6 and 10.1 of the Credit Agreement.

 

8.2           Notices.  All notices, requests and demands to or upon
the Administrative Agent or any Grantor hereunder shall be effected in the
manner provided for in Section 10.2 of the Credit Agreement; provided
that any such notice, request or demand to or upon any Guarantor shall be
addressed to such Guarantor at its notice address set forth on Schedule 1.

 

8.3           No Waiver by Course of Conduct;
Cumulative Remedies.  Neither the
Administrative Agent nor any Secured Party shall by any act (except by a
written instrument pursuant to Section 8.1), delay, indulgence, omission
or otherwise be deemed to have waived any right or remedy hereunder or to have
acquiesced in any Default or Event of Default. 
No failure to exercise, nor any delay in exercising, on the part of the
Administrative Agent or any Secured Party, any right, power or privilege
hereunder shall operate as a waiver thereof. 
No single or partial exercise of any right, power or privilege hereunder
shall preclude any other or further exercise thereof or the exercise of any
other right, power or privilege.  A
waiver by the Administrative Agent or any Secured Party of any right or remedy
hereunder on any one occasion shall not be construed as a bar to any right or
remedy which the Administrative Agent or such Secured Party would otherwise
have on any future occasion.  The rights
and remedies herein provided are cumulative, may be exercised singly or
concurrently and are not exclusive of any other rights or remedies provided by
law.

 

8.4           Enforcement Expenses;
Indemnification.  (a)  Subject
to the limitations set forth in Section 10.5 of the Credit Agreement, each
Guarantor agrees to pay or reimburse each Secured Party and the Administrative
Agent for all its costs and expenses incurred in collecting against such
Guarantor under the guarantee contained in Section 2 or otherwise
enforcing or preserving any rights under this Agreement and the other Loan
Documents to which such Guarantor is a party, including, without limitation,
the fees and disbursements of counsel to the Administrative Agent.

 

26

 

(b)           Each
Guarantor agrees to pay, and to save the Administrative Agent and the Secured
Parties harmless from, any and all liabilities with respect to, or resulting
from any delay in paying, any and all stamp, excise, sales or other taxes which
may be payable or determined to be payable with respect to any of the
Collateral or in connection with any of the transactions contemplated by this
Agreement.

 

(c)           Each
Guarantor agrees to pay, and to save the Administrative Agent and the Secured
Parties harmless from, any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever with respect to the execution, delivery, enforcement,
performance and administration of this Agreement to the extent the Borrower
would be required to do so pursuant to Section 10.5 of the Credit
Agreement.

 

(d)           The
agreements in this Section 8.4 shall survive repayment of the Obligations
and all other amounts payable under the Credit Agreement and the other Loan
Documents.

 

8.5           Successors and Assigns.  This Agreement shall be binding upon the
successors and assigns of each Grantor and shall inure to the benefit of the
Administrative Agent and the Secured Parties and their successors and assigns; provided
that no Grantor may assign, transfer or delegate any of its rights or
obligations under this Agreement without the prior written consent of the
Administrative Agent.

 

8.6           Set-Off.  Subject to the terms of the Intercreditor
Agreement, in addition to any rights and remedies of the Secured Parties
provided by law, each Secured Party shall have the right, without prior notice
to such Grantor or any other Grantor, any such notice being expressly waived by
each Grantor to the extent permitted by applicable law, upon any amount
becoming due and payable by the Borrower and each Grantor hereunder (whether at
the stated maturity, by acceleration or otherwise), to set off and appropriate
and apply against such amount any and all deposits (general or special, time or
demand, provisional or final), in any currency, and any other credits,
indebtedness or claims, in any currency, in each case whether direct or indirect,
absolute or contingent, matured or unmatured, at any time held or owing by such
Secured Party or any branch or agency thereof to or for the credit or the
account of such Grantor, as the case may be. 
Each Secured Party agrees promptly to notify Parent and the
Administrative Agent after any such set-off and application made by such
Secured Party, provided that the failure to give such notice shall not affect
the validity of such set-off and application. 
The rights of the Administrative Agent and each Secured Party under this
Section 8.6 are in addition to other rights and remedies (including,
without limitation, other rights of set-off) which the Administrative Agent or
such Secured Party may have.

 

8.7           Counterparts.  This Agreement may be executed by one or more
of the parties to this Agreement on any number of separate counterparts
(including by telecopy or other electronic transmission), and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument.

 

8.8           Severability.  Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any

 

27

 

such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction.

 

8.9           Section Headings.  The Section headings used in this Agreement
are for convenience of reference only and are not to affect the construction
hereof or be taken into consideration in the interpretation hereof.

 

8.10         Integration.  This Agreement and the other Loan Documents
represent the agreement of the Grantors, the Administrative Agent and the
Secured Parties with respect to the subject matter hereof and thereof, and
there are no promises, undertakings, representations or warranties by the
Administrative Agent or any Secured Party relative to subject matter hereof and
thereof not expressly set forth or referred to herein or in the other Loan
Documents.  In the event of any conflict
between the terms of this Agreement and the provisions of the Credit Agreement,
the provisions of the Credit Agreement shall control.  With respect to the pledge of any Foreign
Subsidiary Voting Stock, in the event of any conflict between the terms of this
Agreement and the provisions of any pledge agreement covering such Foreign
Subsidiary Voting Stock, the provisions of such pledge agreement shall control.

 

8.11         GOVERNING LAW.  THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

8.12         Submission To Jurisdiction; Waivers.  Each of the Agents, the Secured Parties and each
Grantor hereby irrevocably and unconditionally:

 

(a)           submits
for itself and its property in any legal action or proceeding relating to this
Agreement and the other Loan Documents to which it is a party, or for
recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the Courts of the State of New York, the
courts of the United States of America for the Southern District of New York,
and appellate courts from any thereof;

 

(b)           consents
that any such action or proceeding may be brought in such courts and waives any
objection that it may now or hereafter have to the venue of any such action or
proceeding in any such court or that such action or proceeding was brought in
an inconvenient court and agrees not to plead or claim the same;

 

(c)           agrees
that service of process in any such action or proceeding may be effected by
mailing a copy thereof by registered or certified mail (or any substantially
similar form of mail), postage prepaid, to such Grantor at its address referred
to in Section 8.2 or at such other address of which the Administrative
Agent shall have been notified pursuant thereto;

 

(d)           agrees
that nothing herein shall affect the right to effect service of process in any
other manner permitted by law or shall limit the right to sue in any other
jurisdiction; and

 

(e)           waives,
to the maximum extent not prohibited by law, any right it may have to claim or
recover in any legal action or proceeding referred to in this Section any
special, exemplary, punitive or consequential damages.

 

8.13         Acknowledgments.  Each Grantor hereby acknowledges that:

 

28

 

(a)           it
has been advised by counsel in the negotiation, execution and delivery of this
Agreement and the other Loan Documents to which it is a party;

 

(b)           neither
the Administrative Agent nor any Secured Party has any fiduciary relationship
with or duty to any Grantor arising out of or in connection with this Agreement
or any of the other Loan Documents, and the relationship between the Grantors,
on the one hand, and the Administrative Agent and Secured Parties, on the other
hand, in connection herewith or therewith is solely that of debtor and
creditor; and

 

(c)           no
joint venture is created hereby or by the other Loan Documents or otherwise
exists by virtue of the transactions contemplated hereby among the Secured
Parties or among the Grantors and the Secured Parties.

 

8.14         Additional Grantors.  Each Subsidiary of Parent that is required to
become a party to this Agreement pursuant to Section 6.6 of the Credit
Agreement shall become a Grantor for all purposes of this Agreement upon
execution and delivery by such Subsidiary of an Assumption Agreement
substantially in the form of Annex 1 hereto.

 

8.15         Termination, Releases or
Subordination.

 

(a)           This
Agreement, the security interest granted to the Administrative Agent and all
other security interests granted hereby shall terminate with respect to all
Obligations when all the outstanding Obligations (other than contingent
indemnification obligations not yet accrued and payable) have been indefeasibly
paid in full and the Lenders have no further commitment to lend under the
Credit Agreement.

 

(b)           A
Grantor shall automatically be released from its obligations hereunder, and the
security interest granted to the Administrative Agent in the Collateral of such
Grantor shall be automatically released, upon the consummation of any
transaction permitted by the Credit Agreement as a result of which such Grantor
ceases to be a Subsidiary; provided that the Required Lenders (or all
Lenders, as the case may be) shall have consented to such transaction (to the
extent required by the Credit Agreement) and the terms of such consent did not
provide otherwise.

 

(c)           Upon
any Disposition by any Grantor of any Collateral that is permitted under the
Credit Agreement, or upon the effectiveness of any written consent of the
Required Lenders (or all Lenders, as the case may be) to the release of the
security interest granted hereby in any Collateral, the security interest of
such Grantor in such Collateral shall be automatically released or, to the
extent permitted under Section 10.16(a) of the Credit Agreement,
subordinated.

 

(d)           In
connection with any termination, release or subordination pursuant to paragraph
(a), (b) or (c) of this Section 8.15, the Administrative Agent
shall execute and deliver to any Grantor, at such Grantor’s expense, all
documents that such Grantor shall reasonably request to evidence such
termination, release or subordination, as applicable.  Any execution and delivery of documents
pursuant to this Section 8.15 shall be without recourse to or warranty by
the Administrative Agent.

 

8.16         WAIVER OF JURY TRIAL.  EACH GRANTOR HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY

 

29

 

LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.

 

8.17         INTERCREDITOR AGREEMENT.  NOTWITHSTANDING ANYTHING
HEREIN TO THE CONTRARY, THE LIEN AND SECURITY INTEREST GRANTED PURSUANT TO THIS
AGREEMENT AND THE EXERCISE OF ANY RIGHT OR REMEDY HEREUNDER ARE SUBJECT TO THE
PROVISIONS OF THE INTERCREDITOR AGREEMENT. 
IN THE EVENT OF ANY CONFLICT BETWEEN THE TERMS OF THE INTERCREDITOR AGREEMENT
AND THIS AGREEMENT, THE TERMS OF THE INTERCREDITOR AGREEMENT SHALL GOVERN AND
CONTROL.

 

30

 

IN WITNESS WHEREOF, each of the undersigned
has caused this Second Lien Guarantee and Collateral Agreement to be duly
executed and delivered as of the date first above written.

 

	
   

  	
  SIX FLAGS ENTERTAINMENT

  
	
   

  	
  CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
    /s/ James M. Coughlin

  
	
   

  	
  Name:

  	
  James M. Coughlin

  
	
   

  	
  Title:

  	
  General Counsel

  
				

 

 

	
   

  	
  SIX FLAGS OPERATIONS INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
    /s/ James M. Coughlin

  
	
   

  	
  Name:

  	
  James M. Coughlin

  
	
   

  	
  Title:

  	
  General Counsel

  
				

 

 

	
   

  	
  SIX FLAGS THEME PARKS INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
    /s/ James M. Coughlin

  
	
   

  	
  Name:

  	
  James M. Coughlin

  
	
   

  	
  Title:

  	
  General Counsel

  
				

 

 

	
   

  	
  FIESTA TEXAS, INC.

  
	
   

  	
  FUNTIME, INC.

  
	
   

  	
  FUNTIME PARKS, INC.

  
	
   

  	
  GREAT AMERICA LLC

  
	
   

  	
  GREAT ESCAPE HOLDING INC.

  
	
   

  	
  HURRICANE HARBOR GP LLC

  
	
   

  	
  HURRICANE HARBOR LP LLC

  
	
   

  	
  KKI, LLC

  
	
   

  	
  MAGIC MOUNTAIN LLC

  
	
   

  	
  PARK MANAGEMENT CORP.

  
	
   

  	
  PREMIER INTERNATIONAL HOLDINGS

  INC.

  
	
   

  	
  PREMIER PARKS HOLDINGS INC.

  
	
   

  	
  PREMIER PARKS OF COLORADO INC.

  
	
   

  	
  RIVERSIDE PARK ENTERPRISES, INC.

  
	
   

  	
  SF HWP MANAGEMENT LLC

  
	
   

  	
  SFJ MANAGEMENT INC.

  
	
   

  	
  SIX FLAGS AMERICA PROPERTY

  CORPORATION

  
	
   

  	
  SIX FLAGS GREAT ADVENTURE LLC

  
	
   

  	
  SIX FLAGS SERVICES, INC.

  
	
   

  	
  SIX FLAGS SERVICES OF ILLINOIS, INC.

  
	
   

  	
  SIX FLAGS ST. LOUIS LLC

  
	
   

  	
  SOUTH STREET HOLDINGS LLC

  
	
   

  	
  STUART AMUSEMENT COMPANY

  

 

 

	
   

  	
  By:

  	
    /s/ Danielle J. Bernthal

  
	
   

  	
  Name:

  	
  Danielle J. Bernthal

  
	
   

  	
  Title:

  	
  Assistant Vice President

  
				

 

2

 

	
   

  	
  HURRICANE HARBOR LP

  
	
   

  	
   

  
	
   

  	
  By:

  	
  HURRICANE HARBOR GP LLC,

  
	
   

  	
   

  	
  its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
    /s/ Danielle J. Bernthal

  
	
   

  	
   

  	
  Name:

  	
  Danielle J.
  Bernthal

  
	
   

  	
   

  	
  Title:

  	
  Assistant
  Vice President

  
					

 

 

	
   

  	
  SIX FLAGS AMERICA LP

  
	
   

  	
   

  
	
   

  	
  By:

  	
  FUNTIME, INC.,

  
	
   

  	
   

  	
  its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
    /s/ Danielle J. Bernthal

  
	
   

  	
   

  	
  Name:

  	
  Danielle J.
  Bernthal

  
	
   

  	
   

  	
  Title:

  	
  Assistant
  Vice President

  
					

 

 

	
   

  	
  SIX FLAGS GREAT ESCAPE L.P.

  
	
   

  	
  GREAT ESCAPE THEME PARK L.P.

  
	
   

  	
  GREAT ESCAPE RIDES L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  GREAT ESCAPE HOLDING INC.,

  
	
   

  	
   

  	
  their General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
    /s/ Danielle J. Bernthal

  
	
   

  	
   

  	
  Name:

  	
  Danielle J.
  Bernthal

  
	
   

  	
   

  	
  Title:

  	
  Assistant
  Vice President

  
					

 

3

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