Document:

termsdoc08-a5.htm

     

     

     

     

    Exhibit 4.1

    

      CITIBANK
CREDIT CARD ISSUANCE TRUST

      

      Citiseries

      Class
2008-A5 Notes

      

      Issuer
Certificate

      Pursuant to Sections 202 and
301(h) of the Indenture

      

      Reference
is made to the Indenture, dated as of September 26, 2000, as amended by
Amendment No. 1 thereto dated as of November 14, 2001, each between Citibank
Credit Card Issuance Trust (the "Issuer") and Deutsche Bank Trust Company
Americas, as trustee (the "Indenture").  Capitalized terms used herein
that are not otherwise defined have the meanings set forth in the Indenture. All
references herein to designated Sections are to the designated Sections of the
Indenture.

      

      Section
301(h) provides that the Issuer may from time to time create a tranche of Notes
either by or pursuant to an Issuer Certificate setting forth the principal terms
thereof.  Pursuant to this Issuer Certificate, there is hereby created
a tranche of Notes having the following terms:

      

      Series
Designation:  Citiseries.  This series is included in
Group 1.

      

      Tranche
Designation:  $500,000,000  4.85% Class 2008-A5 Notes
of April 2013 (Legal Maturity Date April 2015) (hereinafter, the "Class 2008-A5
Notes")

      

      Currency:  The Class
2008-A5 Notes will be payable, and denominated, in Dollars.

      

      Denominations:  The
Class 2008-A5 Notes will be issuable in minimum denominations of $100,000 and
multiples of $1,000 in excess of that amount.

      

      Issuance
Date:  April 22, 2008

      

      Initial Principal
Amount:  $500,000,000

      

      Issue
Price:  99.868%

      

      Interest
Rate:  4.85% per annum, calculated on the basis of a 360-day
year of twelve 30-day months.

      

      Scheduled Interest Payment
Dates:  The 22nd day of each April and October, beginning
October 2008.

      

      Each
payment of interest on the Class 2008-A5 Notes will include all interest accrued
from and including the preceding Interest Payment Date -- or, for the first
interest period, from and including the Issuance Date -- to and including the
day preceding the current Interest Payment Date, plus any interest accrued but
not previously paid.

      

      The first
deposit targeted to be made to the Interest Funding sub-Account for the Class
2008-A5 Notes will be on the May 21, 2008 Interest Deposit Date and in an amount
equal to $2,020,833.33.

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      

      Expected Principal Payment
Date:  April 22, 2013

      

      Legal Maturity
Date:  April 22, 2015

      

      Monthly Principal
Date:  For the month in which the Expected Principal Payment
Date occurs, April 22, 2013, and for each other month, the 22nd day of such
month, or if such day is not a Business Day, the next following Business
Day.

      

      Required Subordinated Amount of Class
B Notes:  $29,914,550.

      

      Required Subordinated Amount of Class
C Notes:  $39,886,050.

      

      Controlled Accumulation
Amount:  $41,666,667.

      

      Form of Notes:  The
Class 2008-A5 Notes will be issued as Global Notes.  The Global Notes
will initially be registered in the name of Cede & Co., as nominee of The
Depository Trust Company, and will be exchangeable for individual Notes only in
accordance with the provisions of Section 204(c).

      

      Additional Issuances of Class 2008-A5
Notes:  The Issuer may at any time and from time to time issue
additional Class 2008-A5 Notes, subject to the satisfaction of (i) the
conditions precedent set forth in Section 311(a) and (ii) the following
conditions:

      

      
        	
                 
      

              	
                (a)
      the Issuer has obtained written confirmation from each Rating Agency that
      there will be no Ratings Effect with respect to the then outstanding Class
      2008-A5 Notes as a result of the issuance of such additional Class 2008-A5
      Notes;

              

      

      

      
        	
                 
      

              	
                (b)
      as of the date of issuance of the additional Class 2008-A5 Notes, all
      amounts due and owing to the Holders of the then outstanding Class 2008-A5
      Notes have been paid and there is no Nominal Liquidation Amount Deficit
      with respect to the then outstanding Class 2008-A5
  Notes;

              

      

      

      
        	
                 
      

              	
                (c)
      the additional Class 2008-A5 Notes will be fungible with the original
      Class 2008-A5 Notes for federal income tax
  purposes;

              

      

      

      
        	
                 
      

              	
                (d)
      if Holders of the then outstanding Class 2008-A5 Notes have benefit of a
      Derivative Agreement, the Issuer will have obtained a Derivative Agreement
      for the benefit of the Holders of the additional Class 2008-A5 Notes;
      and

              

      

      

      
        	
                 
      

              	
                (e)
      the ratio of the Controlled Accumulation Amount to the Initial Dollar
      Principal Amount of the Class 2008-A5 Notes, including the additional
      Class 2008-A5 Notes, will be equal to the ratio of the Controlled
      Accumulation Amount (before giving effect to the additional issuance) to
      the Initial Dollar Principal Amount of the Class 2008-A5 Notes, excluding
      the additional Class 2008-A5 Notes.

              

      

      

      
        
           

        

        
           
2

          
            

          

        

        
           

        

      

      As of the
date of issuance of additional Class 2008-A5 Notes, the Outstanding Dollar
Principal Amount and Nominal Liquidation Amount of the Class 2008-A5 Notes will
be increased to reflect the Initial Dollar Principal Amount of the additional
Class 2008-A5 Notes.

      

      Any
outstanding Class 2008-A5 Notes and any additional Class 2008-A5 Notes will be
equally and ratably entitled to the benefits of the Indenture without
preference, priority or distinction.

      

      Optional Redemption Provisions other
than Section 1202 "Clean-Up Call":  None

      

      Additional Early Redemption Events or
changes to Early Redemption Events:  None

      

      Additional Events of Default or
changes to Events of Default:  None

      

      Business Day: means any day
other than (a) a Saturday or Sunday or (b) any other day on which national
banking associations or state banking institutions in New York, New York or
South Dakota, or any other state in which the principal executive offices of any
Additional Seller are located, are authorized or obligated by law, executive
order or governmental decree to be closed.

      

      Securities Exchange
Listing:  Application will be made to list the Class 2008-A5
Notes on the Irish Stock Exchange.

      
        
           

        

        
           
3

          
            

          

        

        
           

        

      

      The Class
2008-A5 Notes shall have such other terms as are set forth in the form of Note
attached hereto as Exhibit A.  Pursuant to Section 202, the form of
Note attached hereto has been approved by the Issuer.

      

      
        	 
      	
                CITIBANK
      CREDIT CARD ISSUANCE TRUST

              
	 
      	
                By    Citibank
      (South Dakota), National Association,

              
	 
      	
                as Managing
      Beneficiary

              
	 
      	 
      
	 
      	 
      
	 
      	 
      
	 
      	
                /s/ Douglas C.
      Morrison

                        ___________________________

              
	 
      	
                Douglas C.
    Morrison

              
	 
      	
                Vice
  President

              

      

      

      Dated:  April
22, 2008

      

      
        
           

        

        
           
4

          
            

          

        

        
           

        

      

      Citiseries

       

      Class
2008-A5 Notes

      

      Reference
is made to the resolutions adopted by the Board of Directors of Citibank (South
Dakota), National Association ("Citibank (South Dakota)") on April 26, 2000, as
amended on September 25, 2001 and October 25, 2006. The resolutions authorize
Citibank (South Dakota) from time to time to issue and sell, or to arrange for
or participate in the issuance and sale of, one or more series and/or classes of
pass-through certificates, participation certificates, commercial paper, notes
or other securities representing ownership interests in, or backed by, pools of
credit card receivables or interests therein ("Receivables") in an aggregate
principal amount such that up to $125,000,000,000 of such certificates,
commercial paper, notes or securities are outstanding at any one time and to
sell, transfer, convey or assign Receivables to trusts or other special purpose
entities in connection therewith on such terms as to be determined by the
Citibank (South Dakota) Pricing and Loan Committee (the "Pricing and Loan
Committee").

      

      The
undersigned, a duly authorized member of the Pricing and Loan Committee, on
behalf of such Pricing and Loan Committee, does hereby certify that the terms of
the tranche of Notes set forth in and to be created by the preceding Issuer
Certificate and the increase in the Invested Amount of the Collateral
Certificate resulting from the issuance of such Notes have been approved by such
Pricing and Loan Committee. In addition, the following underwriting/selling
agent terms with respect to this tranche of Notes have been approved by such
Pricing and Loan Committee:

      

      Issue
Price:  99.868%

      

      Underwriting
Commission:  0.250%

      

      Proceeds
to Issuer:  99.618%

      

      Representative
of the Underwriters:  Citigroup Global Markets Inc.

      

      

      The
preceding Issuer Certificate and this certification of Pricing and Loan
Committee approval shall be, continuously from the time of their execution,
official records of Citibank (South Dakota).

      

      

      
        	
                /s/
      Douglas C. Morrison

                _____________________________

              
	
                Douglas
      C. Morrison

              
	
                Member
      of the Pricing and Loan Committee

              
	
                Citibank
      (South Dakota), National
Association

              

      

      

      

      Dated:  April
22, 2008

      
        
           

        

        
           
5

          
            

          

        

        
           

        

      

      Exhibit
A

      

      FORM
OF

      

      CITISERIES

      

      4.85%
CLASS 2008-A5 NOTES OF APRIL 2013

      (Legal
Maturity Date April 2015)

      

      

      
        	
                $500,000,000

              	 
      	
                REGISTERED

              
	
                CUSIP
      No. 17305E EH 4

              	 
      	
                No.
      R-1

              

      

      

      UNLESS
THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED
IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR
TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC),
ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS
AN INTEREST HEREIN.

      

      THE
PRINCIPAL OF THIS NOTE IS PAYABLE AS SET FORTH HEREIN AND IN THE INDENTURE
REFERRED TO BELOW. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT
ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.

      

      

      CITIBANK
CREDIT CARD ISSUANCE TRUST

      

      CITISERIES

      

      4.85%
CLASS 2008-A5 NOTES OF APRIL 2013

      (Legal
Maturity Date April 2015)

      

      

      CITIBANK
CREDIT CARD ISSUANCE TRUST, a trust formed and existing under the laws of the
State of Delaware (including any successor, the "Issuer"), for value received,
hereby promises to pay to CEDE & CO., or its registered assigns, the
principal amount of FIVE HUNDRED MILLION DOLLARS ($500,000,000).  The
Expected Principal Payment Date for this Note is April 22, 2013.  The
Legal Maturity Date for this Note is April 22, 2015.

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      

      The
Issuer hereby promises to pay interest on this Note at the rate of 4.85% per
annum on the 22nd day of each April and October, beginning October 2008, until
the principal of this Note is paid or made available for payment, subject to
certain limitations set forth in the Indenture.  Interest will accrue
on the principal amount of this Note outstanding on the preceding Interest
Payment Date (after giving effect to any payments of principal made on the
preceding Interest Payment Date), or with respect to the first Interest Payment
Date, the initial principal amount of this Note. Interest will accrue from April
22, 2008 and be computed on the basis of a 360-day year of twelve 30-day
months.

      

      If any
Interest Payment Date or Principal Payment Date of this Note falls on a day that
is not a Business Day, the required payment of interest or principal will be
made on the following Business Day.

      

      This Note
is one of the Citiseries, Class 2008-A5 Notes issued pursuant to the Indenture,
dated as of September 26, 2000 (as amended and otherwise modified from time to
time, the "Indenture") between the Issuer and Deutsche Bank Trust Company
Americas, as Trustee. For purposes of this Note, the term "Indenture" includes
any supplemental indenture or Issuer Certificate relating to the Citiseries,
Class 2008-A5 Notes. This Note is subject to all of the terms of the Indenture.
All terms used in this Note that are not otherwise defined herein and that are
defined in the Indenture will have the meanings assigned to them
therein.

      

      The
principal of and interest on this Note are payable in such coin or currency of
the United States of America as at the time of payment is legal tender for
payment of public and private debts.

      

      Each
Holder by acceptance of this Note, and each owner of a beneficial interest in
this Note by acceptance of a beneficial interest in this Note, is deemed to have
consented to such amendments to the Pooling and Servicing Agreement and other
operative documents as are necessary to permit the Seller to retain sale
treatment for accounting purposes of the transfer of assets to the Master Trust,
in accordance with the provisions of Financial Accounting Standards Board SFAS
No. 140.

      

      Reference
is made to the further provisions of this Note set forth on the reverse hereof,
which will have the same effect as though fully set forth on the face of this
Note.

      

      Unless
the certificate of authentication hereon has been executed by the Trustee whose
name appears below by manual signature, this Note will not

      
        
           

        

        
           
2

          
            

          

        

        
           

        

      

      be
entitled to any benefit under the Indenture, or be valid or obligatory for any
purpose.

      

      IN
WITNESS WHEREOF, the Issuer has caused this instrument to be signed, manually or
in facsimile, by an Issuer Authorized Officer.

      

      
        	 
      	
                CITIBANK
      CREDIT CARD ISSUANCE TRUST

              
	 
      	 
      
	 
      	
                By:       CITIBANK
      (SOUTH DAKOTA),

              
	 
      	
                NATIONAL
      ASSOCIATION,

              
	 
      	
                as
      Managing Beneficiary of

              
	 
      	
                Citibank
      Credit Card Issuance Trust

              
	 
      	 
      
	 
      	 
      
	 
      	
                By:
      __________________________________

              
	 
      	
                Douglas C.
    Morrison

              
	 
      	
                Vice
  President

              

      

      

      Dated:  April
22, 2008

      

      

      

      

      TRUSTEE'S
CERTIFICATE OF AUTHENTICATION

      

      

      This is
one of the Notes designated above and referred to in the within mentioned
Indenture.

      

      

      
        	 
      	
                DEUTSCHE
      BANK TRUST COMPANY AMERICAS,

              
	 
      	
                as
      Trustee under the Indenture

              
	 
      	 
      
	 
      	 
      
	 
      	
                By:
      _________________________________

              
	 
      	
                Authorized
    Signatory

              

      

      

      Dated:  April
22, 2008

      

      

      

      

      
        
           

        

        
          3 

          
            

          

        

        
           

        

      

      REVERSE
OF NOTE

      

      This Note
is one of a duly authorized issue of Notes of the Issuer, designated as its
Citiseries 4.85% Class 2008-A5 Notes of April 2013 (Legal Maturity Date April
2015) (herein called the "Notes"), all issued under an Indenture, to which
Indenture reference is hereby made for a statement of the respective rights and
obligations thereunder of the Issuer, the Trustee and the Holders of the
Notes.

      

      This Note
ranks pari passu with all other Class A Notes of the same series, as set forth
in the Indenture. This Note is secured to the extent, and by the collateral,
described in the Indenture.

      

      The
Issuer will pay interest on overdue interest as set forth in the Indenture to
the extent lawful.

      

      Each
Holder by acceptance of this Note, and each owner of a beneficial interest in
this Note by acceptance of a beneficial interest in this Note, agrees that no
recourse may be taken, directly or indirectly, with respect to the obligations
of the Issuer or the Trustee on the Notes, against the Issuer, the Issuer
Trustee, Citibank (South Dakota), the Trustee or any affiliate, officer,
employee or director of any of them, and the obligation of the Issuer to pay
principal of or interest on this Note or any other amount payable to the Holder
of this Note will be subject to Article V of the Indenture.

      

      Each
Holder by acceptance of this Note, and each owner of a beneficial interest in
this Note by acceptance of a beneficial interest in this Note, agrees that this
Note is intended to be debt of Citibank (South Dakota) for federal, state and
local income and franchise tax purposes, and agrees to treat this Note
accordingly for all such purposes, unless otherwise required by a taxing
authority.

      

      Each
Holder by acceptance of this Note, and each owner of a beneficial interest in
this Note by acceptance of a beneficial interest in this Note, agrees that it
will not at any time institute against the Issuer, or join in any institution
against the Issuer of, any bankruptcy, reorganization, arrangement, insolvency
or liquidation proceeding, or other proceedings under any United States federal
or state bankruptcy or similar law in connection with any obligations relating
to this Note, the Indenture or any Derivative Agreement.

      

      This Note
and the Indenture will be construed in accordance with and governed by the laws
of the State of New York.

      

      No
reference herein to the Indenture and no provision of this Note or of the
Indenture will alter or impair the obligation of the Issuer, which is absolute
and unconditional, to pay the principal of and interest on this Note at the
times, place and rate, and in the coin or currency, herein
prescribed.

      

      Certain
amendments may be made to the Indenture without the consent of the Holder of
this Note.  This Note must be surrendered for final payment of
principal and interest.

      

      

      
        
           

        

        
           
4

          
            

          

        

        
           

        

      

      ASSIGNMENT

      

      

      Social
Security or taxpayer I.D. or other identifying number of
assignee:____________________

      

      FOR VALUE
RECEIVED, the undersigned hereby sells, assigns and transfers unto

      

      ___________________________________________________________________

      

      ___________________________________________________________________

      (name and
address of assignee)

      

      the
within Note and all rights thereunder, and hereby irrevocably constitutes and
appoints __________________________________________________________, attorney,
to transfer said Note on the books kept for registration thereof, with full
power of substitution in the premises.

      

      Dated:  ____________________________

      

      _________________________*

      
        	
                 
      

              	
                Signature
      Guaranteed:

              

      

      

      

      

      

      ----------------

      *    NOTE:
The signature to this assignment must correspond with the name of the registered
owner as it appears on the face of the within Note in every particular without
alteration, enlargement or any change whatsoever.

      

       

       

       

      5Exhibit 10.1 to Hecla Mining Company Form 8-K dated April 16, 2008

Exhibit
10.1 

AMENDED AND
RESTATED 

CREDIT AGREEMENT,

dated as of April
16, 2008,

among

HECLA MINING
COMPANY, 

as the Borrower,

VARIOUS FINANCIAL
INSTITUTIONS AND OTHER PERSONS 

FROM TIME TO TIME PARTIES HERETO, 

as the Lenders, and

THE BANK OF NOVA
SCOTIA, 

as the Administrative Agent for the Lenders.

	
 

	

SCOTIA CAPITAL, 

as Sole Lead Arranger and Sole Bookrunner

TABLE OF CONTENTS

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Page

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
ARTICLE I

	
DEFINITIONS AND ACCOUNTING TERMS

	
 

	
2

	
 

	
SECTION 1.1.

	
 

	
Defined Terms

	
 

	
2

	
 

	
SECTION 1.2.

	
 

	
Use of Defined Terms

	
 

	
32

	
 

	
SECTION 1.3.

	
 

	
Certain Interpretive Matters

	
 

	
32

	
 

	
SECTION 1.4.

	
 

	
Cross-References

	
 

	
33

	
 

	
SECTION 1.5.

	
 

	
Accounting and Financial Determinations

	
 

	
33

	
ARTICLE II 

	
COMMITMENTS, BORROWING AND ISSUANCE PROCEDURES, NOTES AND LETTERS OF CREDIT

	
 

	
33

	
 

	
SECTION 2.1.

	
 

	
Loan Commitment

	
 

	
33

	
 

	
SECTION 2.2.

	
 

	
Borrowing Procedure

	
 

	
34

	
 

	
SECTION 2.3.

	
 

	
Use of Proceeds

	
 

	
34

	
 

	
SECTION 2.4.

	
 

	
Continuation and Conversion Elections

	
 

	
34

	
 

	
SECTION 2.5.

	
 

	
Funding

	
 

	
35

	
 

	
SECTION 2.6.

	
 

	
Register; Notes

	
 

	
35

	
ARTICLE III

	
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES

	
 

	
36

	
 

	
SECTION 3.1.

	
 

	
Repayments and Prepayments; Application

	
 

	
36

	
 

	
          SECTION 3.1.1. 

	
 

	
Repayments and Prepayments

	
 

	
36

	
 

	
          SECTION 3.1.2. 

	
 

	
Application

	
 

	
38

	
 

	
SECTION 3.2. 

	
 

	
Interest Provisions

	
 

	
38

	
 

	
          SECTION 3.2.1. 

	
 

	
Rates

	
 

	
39

	
 

	
          SECTION 3.2.2. 

	
 

	
Default Rates

	
 

	
39

	
 

	
          SECTION 3.2.3. 

	
 

	
Payment Dates

	
 

	
39

	
 

	
SECTION 3.3. 

	
 

	
Fees

	
 

	
40

	
 

	
          SECTION 3.3.1. 

	
 

	
Fee Letter Amounts

	
 

	
40

	
 

	
          SECTION 3.3.2. 

	
 

	
Term II Loan Commitment Fee

	
 

	
40

	
ARTICLE IV 

	
CERTAIN LIBO RATE AND OTHER PROVISIONS

	
 

	
40

	
 

	
SECTION 4.1.

	
 

	
LIBO Rate Lending Unlawful

	
 

	
40

	
 

	
SECTION 4.2.

	
 

	
Deposits Unavailable

	
 

	
40

	
 

	
SECTION 4.3.

	
 

	
Increased LIBO Rate Loan Costs, etc

	
 

	
41

	
 

	
SECTION 4.4.

	
 

	
Funding Losses

	
 

	
41

-i-

TABLE OF CONTENTS
(continued) 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Page

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
SECTION 4.5.

	
 

	
Increased Capital Costs

	
 

	
42

	
 

	
SECTION 4.6.

	
 

	
Taxes

	
 

	
42

	
 

	
SECTION 4.7.

	
 

	
Payments, Computations, Proceeds of Collateral, etc

	
 

	
44

	
 

	
SECTION 4.8.

	
 

	
Sharing of Payments

	
 

	
45

	
 

	
SECTION 4.9.

	
 

	
Setoff

	
 

	
46

	
ARTICLE V

	
CONDITIONS TO EFFECTIVENESS AND CREDIT EXTENSIONS

	
 

	
46

	
 

	
SECTION 5.1.

	
 

	
Effectiveness

	
 

	
46

	
 

	
          SECTION 5.1.1.

	
 

	
Resolutions, etc

	
 

	
46

	
 

	
          SECTION 5.1.2.

	
 

	
Effective Date Certificate

	
 

	
47

	
 

	
          SECTION 5.1.3.

	
 

	
Consummation of Transaction

	
 

	
47

	
 

	
          SECTION 5.1.4.

	
 

	
Payment of Outstanding Indebtedness, etc

	
 

	
47

	
 

	
          SECTION 5.1.5.

	
 

	
Delivery of Notes

	
 

	
48

	
 

	
          SECTION 5.1.6.

	
 

	
Financial Information, etc

	
 

	
48

	
 

	
          SECTION 5.1.7.

	
 

	
Solvency, etc

	
 

	
48

	
 

	
          SECTION 5.1.8.

	
 

	
Subsidiary Guaranty

	
 

	
48

	
 

	
          SECTION 5.1.9.

	
 

	
Pledge Agreement and Security Agreement

	
 

	
49

	
 

	
          SECTION 5.1.10.

	
 

	
Filing Agent, etc

	
 

	
49

	
 

	
          SECTION 5.1.11.

	
 

	
Insurance

	
 

	
50

	
 

	
          SECTION 5.1.12.

	
 

	
Opinion of Counsel

	
 

	
50

	
 

	
          SECTION 5.1.13.

	
 

	
Closing Fees, Expenses, etc

	
 

	
50

	
 

	
          SECTION 5.1.14.

	
 

	
PATRIOT Act Disclosures

	
 

	
50

	
 

	
          SECTION 5.1.15.

	
 

	
Compliance Certificate

	
 

	
50

	
 

	
          SECTION 5.1.16.

	
 

	
Hecla Mine Plan

	
 

	
50

	
 

	
SECTION 5.2.

	
 

	
All Credit Extensions

	
 

	
50

	
 

	
          SECTION 5.2.1.

	
 

	
Compliance with Warranties, No Default, etc

	
 

	
50

	
 

	
          SECTION 5.2.2.

	
 

	
Credit Extension Request, etc

	
 

	
51

	
 

	
          SECTION 5.2.3.

	
 

	
Satisfactory Legal Form

	
 

	
51

	
ARTICLE VI

	
REPRESENTATIONS AND WARRANTIES

	
 

	
51

	
 

	
SECTION 6.1.

	
 

	
Organization, etc

	
 

	
51

	
 

	
SECTION 6.2.

	
 

	
Due Authorization, Non-Contravention, etc

	
 

	
51

-ii-

TABLE OF CONTENTS
(continued) 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Page

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
SECTION 6.3.

	
 

	
Government Approval, Regulation, etc

	
 

	
52

	
 

	
SECTION 6.4.

	
 

	
Validity, etc

	
 

	
52

	
 

	
SECTION 6.5.

	
 

	
Financial Information; Undisclosed Liabilities

	
 

	
52

	
 

	
SECTION 6.6.

	
 

	
No Material Adverse Change

	
 

	
53

	
 

	
SECTION 6.7.

	
 

	
Litigation, Labor Controversies, etc

	
 

	
53

	
 

	
SECTION 6.8.

	
 

	
Subsidiaries

	
 

	
53

	
 

	
SECTION 6.9.

	
 

	
Ownership of Properties.

	
 

	
53

	
 

	
SECTION 6.10.

	
 

	
Taxes

	
 

	
54

	
 

	
SECTION 6.11.

	
 

	
Pension and Welfare Plans

	
 

	
54

	
 

	
SECTION 6.12.

	
 

	
Environmental Warranties

	
 

	
54

	
 

	
SECTION 6.13.

	
 

	
Accuracy of Information

	
 

	
56

	
 

	
SECTION 6.14.

	
 

	
Regulations U and X

	
 

	
56

	
 

	
SECTION 6.15.

	
 

	
Material Contracts

	
 

	
56

	
 

	
SECTION 6.16.

	
 

	
Solvency

	
 

	
56

	
 

	
SECTION 6.17.

	
 

	
Insurance

	
 

	
56

	
 

	
SECTION 6.18.

	
 

	
Condition of Business and Operations

	
 

	
56

	
 

	
SECTION 6.19.

	
 

	
Compliance with Law, etc

	
 

	
57

	
 

	
SECTION 6.20.

	
 

	
Mining Rights

	
 

	
57

	
 

	
SECTION 6.21.

	
 

	
Greens Creek Operations

	
 

	
57

	
 

	
SECTION 6.22.

	
 

	
Consummation of Acquisition; Representations and Warranties from Acquisition Agreement

	
 

	
57

	
ARTICLE VII 

	
COVENANTS

	
 

	
57

	
 

	
SECTION 7.1.

	
 

	
Affirmative Covenants

	
 

	
57

	
 

	
          SECTION 7.1.1.

	
 

	
Financial Information, Reports, Notices, etc

	
 

	
58

	
 

	
          SECTION 7.1.2.

	
 

	
Maintenance of Existence; Compliance with Contracts, Laws, etc

	
 

	
61

	
 

	
          SECTION 7.1.3.

	
 

	
Maintenance of Properties

	
 

	
61

	
 

	
          SECTION 7.1.4.

	
 

	
Insurance

	
 

	
61

	
 

	
          SECTION 7.1.5.

	
 

	
Books and Records

	
 

	
62

	
 

	
          SECTION 7.1.6.

	
 

	
Visitation

	
 

	
62

	
 

	
          SECTION 7.1.7.

	
 

	
Environmental Law Covenant

	
 

	
63

-iii-

TABLE OF CONTENTS
(continued) 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Page

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
          SECTION 7.1.8.

	
 

	
Future Guarantors, Security, etc

	
 

	
63

	
 

	
          SECTION 7.1.9.

	
 

	
Further Assurances

	
 

	
65

	
 

	
          SECTION 7.1.10.

	
 

	
Material Subsidiaries

	
 

	
65

	
 

	
          SECTION 7.1.11.

	
 

	
Independent Corporate Existence

	
 

	
65

	
 

	
          SECTION 7.1.12.

	
 

	
Hedging

	
 

	
66

	
 

	
          SECTION 7.1.13.

	
 

	
Maintenance of Mining Rights

	
 

	
66

	
 

	
          SECTION 7.1.14.

	
 

	
Issuance of Subordinated Debt; Status of Obligations as Senior Indebtedness, etc

	
 

	
66

	
 

	
SECTION 7.2.

	
Negative Covenants

	
 

	
66

	
 

	
          SECTION 7.2.1.

	
 

	
Business Activities

	
 

	
67

	
 

	
          SECTION 7.2.2.

	
 

	
Indebtedness

	
 

	
67

	
 

	
          SECTION 7.2.3.

	
 

	
Liens

	
 

	
68

	
 

	
          SECTION 7.2.4.

	
 

	
Financial Condition and Operations

	
 

	
69

	
 

	
          SECTION 7.2.5.

	
 

	
Investments

	
 

	
70

	
 

	
          SECTION 7.2.6.

	
 

	
Restricted Payments, etc

	
 

	
71

	
 

	
          SECTION 7.2.7.

	
 

	
No Prepayment of Certain Indebtedness

	
 

	
72

	
 

	
          SECTION 7.2.8.

	
 

	
Issuance of Capital Securities

	
 

	
73

	
 

	
          SECTION 7.2.9.

	
 

	
Consolidation, Merger, etc

	
 

	
73

	
 

	
          SECTION 7.2.10.

	
 

	
Permitted Dispositions

	
 

	
74

	
 

	
          SECTION 7.2.11.

	
 

	
Modification of Certain Agreements

	
 

	
74

	
 

	
          SECTION 7.2.12.

	
 

	
Transactions with Affiliates

	
 

	
75

	
 

	
          SECTION 7.2.13.

	
 

	
Restrictive Agreements, etc

	
 

	
75

	
 

	
          SECTION 7.2.14.

	
 

	
Hedging Agreements

	
 

	
76

	
 

	
          SECTION 7.2.15.

	
 

	
Greens Creek Participant Restrictions

	
 

	
76

	
 

	
          SECTION 7.2.16.

	
 

	
Change to Fiscal Year

	
 

	
77

	
 

	
          SECTION 7.2.17.

	
 

	
Sale and Leaseback

	
 

	
77

	
ARTICLE VIII

	
EVENTS OF DEFAULT

	
 

	
77

	
 

	
SECTION 8.1.

	
Listing of Events of Default

	
 

	
77

	
 

	
          SECTION 8.1.1.

	
 

	
Non-Payment of Obligations

	
 

	
78

	
 

	
          SECTION 8.1.2.

	
 

	
Breach of Warranty

	
 

	
78

-iv-

TABLE OF CONTENTS
(continued) 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Page

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
          SECTION 8.1.3.

	
 

	
Non-Performance of Certain Covenants and Obligations

	
 

	
78

	
 

	
          SECTION 8.1.4.

	
 

	
Non-Performance of Other Covenants and Obligations

	
 

	
78

	
 

	
          SECTION 8.1.5.

	
 

	
Default on Other Indebtedness

	
 

	
78

	
 

	
          SECTION 8.1.6.

	
 

	
Judgments

	
 

	
79

	
 

	
          SECTION 8.1.7.

	
 

	
Pension Plans

	
 

	
79

	
 

	
          SECTION 8.1.8.

	
 

	
Change in Control

	
 

	
79

	
 

	
          SECTION 8.1.9.

	
 

	
Bankruptcy, Insolvency, etc

	
 

	
79

	
 

	
          SECTION 8.1.10.

	
 

	
Impairment of Security, etc

	
 

	
80

	
 

	
          SECTION 8.1.11.

	
 

	
Failure of Subordination

	
 

	
80

	
 

	
          SECTION 8.1.12.

	
 

	
Abandonment of Greens Creek Mine or Lucky Friday Mine

	
 

	
80

	
 

	
          SECTION 8.1.13.

	
 

	
Regulatory Action

	
 

	
80

	
 

	
          SECTION 8.1.14.

	
 

	
Material Adverse Change

	
 

	
81

	
 

	
          SECTION 8.1.15.

	
 

	
Greens Creek

	
 

	
81

	
 

	
SECTION 8.2.

	
 

	
Action if Bankruptcy

	
 

	
81

	
 

	
SECTION 8.3.

	
 

	
Action if Other Event of Default

	
 

	
81

	
ARTICLE IX

	
THE ADMINISTRATIVE AGENT

	
 

	
81

	
 

	
SECTION 9.1.

	
 

	
Appointments; Actions

	
 

	
81

	
 

	
SECTION 9.2.

	
 

	
Funding Reliance, etc

	
 

	
82

	
 

	
SECTION 9.3.

	
 

	
Exculpation

	
 

	
82

	
 

	
SECTION 9.4.

	
 

	
Successor

	
 

	
83

	
 

	
SECTION 9.5.

	
 

	
Loans by Scotiabank

	
 

	
83

	
 

	
SECTION 9.6.

	
 

	
Credit Decisions

	
 

	
83

	
 

	
SECTION 9.7.

	
 

	
Copies, etc

	
 

	
84

	
 

	
SECTION 9.8.

	
 

	
Reliance by Administrative Agent

	
 

	
84

	
 

	
SECTION 9.9.

	
 

	
Defaults

	
 

	
84

	
 

	
SECTION 9.10.

	
 

	
Appointment of Supplemental Agents, Sub-Agents; etc

	
 

	
85

	
ARTICLE X

	
MISCELLANEOUS PROVISIONS

	
 

	
85

	
 

	
SECTION 10.1.

	
 

	
Waivers, Amendments, etc

	
 

	
85

-v-

TABLE OF CONTENTS
(continued) 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Page

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
SECTION 10.2.

	
 

	
Notices; Time

	
 

	
86

	
 

	
SECTION 10.3.

	
 

	
Payment of Costs and Expenses

	
 

	
87

	
 

	
SECTION 10.4.

	
 

	
Indemnification

	
 

	
88

	
 

	
SECTION 10.5.

	
 

	
Survival

	
 

	
89

	
 

	
SECTION 10.6.

	
 

	
Severability

	
 

	
89

	
 

	
SECTION 10.7.

	
 

	
Headings

	
 

	
89

	
 

	
SECTION 10.8.

	
 

	
Execution in Counterparts, Effectiveness, etc

	
 

	
89

	
 

	
SECTION 10.9.

	
 

	
Governing Law; Entire Agreement

	
 

	
89

	
 

	
SECTION 10.10.

	
 

	
Successors and Assigns

	
 

	
90

	
 

	
SECTION 10.11.

	
 

	
Sale and Transfer of Credit Extensions; Participations in Credit Extensions; Notes

	
 

	
90

	
 

	
SECTION 10.12.

	
 

	
Replacement of Lenders under Certain Circumstances

	
 

	
93

	
 

	
SECTION 10.13.

	
 

	
Other Transactions

	
 

	
94

	
 

	
SECTION 10.14.

	
 

	
Forum Selection and Consent to Jurisdiction

	
 

	
94

	
 

	
SECTION 10.15.

	
 

	
Waiver of Jury Trial

	
 

	
95

	
 

	
SECTION 10.16.

	
 

	
Independence of Covenants and Default Provisions

	
 

	
95

	
 

	
SECTION 10.17.

	
 

	
Counsel Representation

	
 

	
95

	
 

	
SECTION 10.18.

	
 

	
PATRIOT Act Notification

	
 

	
96

	
 

	
SECTION 10.19.

	
 

	
Effect of Amendment and Restatement of the Existing Credit Agreement

	
 

	
96

-vi-

SCHEDULES AND EXHIBITS 

	
 

	
 

	
 

	
SCHEDULE I

	
-

	
Disclosure
 Schedule

	
SCHEDULE II

	
-

	
Percentages;
 LIBOR Office; Domestic Office; Contact Information

	
 

	
 

	
 

	
EXHIBIT A-1

	
-

	
Form of Term
 I Note

	
EXHIBIT A-2

	
-

	
Form of Term
 II Note

	
EXHIBIT B

	
-

	
Form of
 Borrowing Request

	
EXHIBIT C

	
-

	
Form of Continuation/Conversion
 Notice

	
EXHIBIT D

	
-

	
Form of
 Effective Date Certificate

	
EXHIBIT E

	
-

	
Form of
 Compliance Certificate

	
EXHIBIT F

	
-

	
Form of
 Subsidiary Guaranty

	
EXHIBIT G

	
-

	
Form of
 Pledge Agreement

	
EXHIBIT H

	
-

	
Form of
 Security Agreement

	
EXHIBIT I

	
-

	
Form of
 Interco Subordination Agreement

	
EXHIBIT J

	
-

	
Form of
 Lender Assignment Agreement

-vii-

AMENDED AND RESTATED
 CREDIT AGREEMENT

          THIS
AMENDED AND RESTATED CREDIT AGREEMENT, dated as of April 16, 2008, is among
HECLA MINING COMPANY, a Delaware corporation (the “Borrower”), the
various financial institutions and other Persons from time to time parties
hereto (the “Lenders”), THE BANK OF NOVA SCOTIA (“Scotiabank”), as
administrative agent (in such capacity, the “Administrative Agent”) for
the Lenders and Scotia Capital, as lead arranger (the “Lead Arranger”). 

W I T N E S S E T H:

          WHEREAS,
the Borrower is engaged in the mining, extraction, production, handling,
milling and other forms of processing ores, minerals and mineral resources
(capitalized terms used in these recitals and not defined in these recitals to have
the meanings set forth in Section 1.1 below); 

          WHEREAS,
the Borrower has entered into that certain Credit Agreement, dated as of
September 12, 2005 ( as amended, supplemented or otherwise modified from time
to time prior to the date hereof, the “Existing Credit Agreement”), with
Scotiabank as administrative agent thereunder, and each lender from time to
time party thereto; 

          WHEREAS,
pursuant to the Acquisition Agreement, Hecla Admiralty, a direct wholly-owned
subsidiary of Borrower will acquire all of the issued and outstanding Capital
Securities of Kennecott and Kennecott Juneau (the “Acquisition”); 

          WHEREAS,
Borrower has requested that in connection with the Acquisition, that the
Existing Credit Agreement be amended and restated in its entirety to reflect
the terms of this Agreement, and the Lenders have agreed to amend and restate
the Existing Credit Agreement in its entirety to read as set forth in this
Agreement with the intent that the terms of this Agreement shall supersede the
terms of the Existing Credit Agreement (each of which shall hereafter have no
further effect upon the parties thereto, other than those that remain herein
and other than for accrued fees and expenses, and indemnification provisions,
accrued and owing under the terms of the Existing Credit Agreement on or prior
to the date hereof or arising (in the case of an indemnification) under the
terms of the Existing Credit Agreement, in each case to the extent provided for
in the Existing Credit Agreement); 

          WHEREAS,
in connection with the amendment and restatement of the Existing Credit
Agreement and the Acquisition, the Borrower has requested that the Lenders
extend credit to the Borrower in the form of the Loans; and 

          WHEREAS,
the proceeds from the Loans will be used to (a) finance the Acquisition and (b)
repay all of the existing Indebtedness outstanding under the Existing Credit
Agreement. 

          WHEREAS,
the Lenders are willing, on the terms and subject to the conditions hereinafter
set forth, to extend the Commitments and make the Loans. 

          NOW,
THEREFORE, the parties hereto agree as follows. 

ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS

          SECTION 1.1. Defined Terms. The following terms (whether
or not underscored) when used in this Agreement, including its preamble
and recitals, shall, except where the context otherwise requires, have the
following meanings: 

          “Acquisition”
is defined in the recitals hereto. 

          “Acquisition
Agreement” means the Stock Purchase Agreement, dated as of February 12,
2008, among Kennecott Holdings, Hecla Admiralty and Borrower, as amended,
supplemented, amended and restated or otherwise modified in accordance with Section
7.2.11. 

          “Administrative
Agent” is defined in the preamble and includes each other Person
appointed as the successor Administrative Agent pursuant to Section 9.4.

          “Affiliate”
means, relative to any Person, any other Person which, directly or indirectly,
controls, is controlled by or is under common control with such Person.
“Control” of a Person means the power, directly or indirectly, 

	
 

	
 

	
 

	
          (x)
 to vote 10% or more of the Capital Securities (on a fully diluted basis) of
 such Person having ordinary voting power for the election of directors, managing
 members or general partners (as applicable); or 

	
 

	
 

	
 

	
          (y)
 to direct or cause the direction of the management and policies of such
 Person (whether by contract or otherwise). 

	
 

	
 

	
 

	
“Agreement”
 means, on any date, this Credit Agreement. 

          “Alternate
Base Rate” means, on any date and with respect to all Base Rate Loans, a
fluctuating rate of interest per annum (rounded upward, if necessary, to the
next highest 1/16 of 1%) equal to the higher of 

	
 

	
 

	
 

	
 

	
 

	
(a) the Base
 Rate in effect on such day; and 

	
 

	
 

	
 

	
 

	
 

	
(b) the
 Federal Funds Rate in effect on such day plus 1⁄2 of 1%. 

          Changes
in the rate of interest on that portion of any Loans maintained as Base Rate
Loans will take effect simultaneously with each change in the Alternate Base
Rate. The Administrative Agent will give notice promptly to the Borrower and
the Lenders of changes in the Alternate Base Rate; provided that, the
failure to give such notice shall not affect the Alternate Base Rate in effect
after such change. 

          “Annualized
Basis” means, (a) with respect to the Fiscal Quarter ending on September
30, 2008, the applicable amount for such Fiscal Quarter multiplied by 4, (b)
with respect to the Fiscal Quarter ending on December 31, 2008, the applicable
amount for such Fiscal Quarter and 

-2-

the
immediately preceding Fiscal Quarter multiplied by 2 and (c) with respect to
the Fiscal Quarter ending on March 31, 2009, the applicable amount for such
Fiscal Quarter and the two preceding Fiscal Quarters multiplied by 4/3. 

          “Applicable
Law” means, relative to any Person, (x) all provisions of laws, statutes,
treaties, ordinances, rules, regulations, requirements, restrictions, permits,
certificates, decisions, directives, guidelines or orders of any Governmental
Authority applicable to such Person or any of its assets or property and (y)
all judgments, injunctions, orders and decrees of all courts and arbitrators in
proceedings or actions in which such Person is a party or by which any of its
assets or properties are bound. 

          “Applicable
Margin” means 

	
 

	
 

	
 

	
          (a)
 relative to the interest rates on the outstanding Term I Loans, the
 applicable percentage set forth below opposite the applicable Leverage Ratio
 range: 

	
 

	
 

	
 

	
 

	
 

	
 

	
Leverage Ratio

	
 

	
LIBO Rate plus

	
 

	
Base Rate plus

	
 

	 
	 
	 
	 
	 
	 

	
less
 than 1.00

	
 

	
1.25%

	
 

	
0.25%

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
greater
 than or equal to 1.00,

	
 

	
1.375%

	
 

	
0.375%

	
 

	
but
 less than 2.00

	
 

	
 

	
 

	
 

	
 

	

greater
 than or equal to 2.00,

	
 

	
1.625%

	
 

	
0.625%

	
 

	
but
 less than 2.50

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
greater
 than or equal to 2.50

	
 

	
2.00%

	
 

	
1.00%

	
 

	
 

	
 

	
 

	
          (b)
 relative to the interest rates on outstanding Term II Loans, 2.00% per
 annum with respect to Base Rate Loans and 3.00% per annum
 with respect to LIBO Rate Loans. 

          Notwithstanding
anything to the contrary set forth in this Agreement (including the then
effective Leverage Ratio), the Applicable Margin for all Term I Loans from the
Effective Date through the end of the second complete Fiscal Quarter after the
Effective Date shall be (x) 0.625% for Base Rate Loans and (y) 1.625% for LIBO
Rate Loans. Changes in the Applicable Margin resulting from a change in the
Leverage Ratio shall become effective upon delivery by the Borrower to the
Administrative Agent of a new Compliance Certificate. If the Borrower fails to
deliver a Compliance Certificate by applicable due date as specified in Section
7.1.1(c), the Applicable Margin from such date and up to but excluding the
date of receipt by the Administrative Agent of such Compliance Certificate
shall equal the highest Applicable Margin set forth above. 

          “Approval”
means each approval, authorization, license, permit, franchise, consent,
certificate, franchise, exemption, filing or registration by or with any
Governmental Authority. 

          “Approved
Fund” means any Person (other than a natural Person) that (a) is engaged in
making, purchasing, holding or otherwise investing in commercial loans and
similar extensions of credit in the ordinary course of its business, and (b) is
administered or managed by a Lender, 

-3-

an Affiliate
of a Lender or a Person or an Affiliate of a Person that administers or manages
a Lender. 

          “Authorized
Officer” means, relative to any Obligor, those of its officers, general
partners or managing members (as applicable) whose signatures and incumbency
shall have been certified to the Administrative Agent and the Lenders pursuant
to Section 5.1.1 (or otherwise most recently certified to the
Administrative Agent pursuant hereto). 

          “Base
Rate” means, at any time, the rate of interest then most recently
established by the Administrative Agent in New York as its base rate for
Dollars loaned in the United States. The Base Rate is not necessarily intended
to be the lowest rate of interest determined by the Administrative Agent in
connection with extensions of credit. 

          “Base
Rate Loan” means a Loan bearing interest at a fluctuating rate determined
by reference to the Alternate Base Rate. 

          “Board
of Directors” means, relative to any Person, (w) in the case of any
corporation, its board of directors, (x) in the case of any limited liability
company, its board of managers (or the functional equivalent of the foregoing),
(y) in the case of any partnership, the Board of Directors of the general
partner of such partnership (or the functional equivalent of the foregoing) and
(z) in any other case, the functional equivalent of the foregoing. 

          “Borrower”
is defined in the preamble. 

          “Borrowing”
means the Loans of the same type and, in the case of LIBO Rate Loans, having
the same Interest Period made by all Lenders required to make such Loans on the
same Business Day and pursuant to the same Borrowing Request in accordance with
Section 2.2. 

          “Borrowing
Request” means a Loan request and certificate duly executed by an
Authorized Officer of the Borrower substantially in the form of Exhibit B
hereto. 

          “Burke
Trading” means Burke Trading Inc., a Delaware corporation. 

          “Business
Day” means 

	
 

	
 

	
 

	
          (x)
 any day which is neither a Saturday or Sunday nor a legal holiday on which
 banks are authorized or required to be closed in New York, New York, London,
 England or Toronto, Canada; and 

	
 

	
 

	
 

	
          (y)
 relative to the making, continuing, prepaying or repaying of any LIBO Rate
 Loans, any day which is a Business Day described in clause (x) above
 and which is also a day on which dealings in Dollars are carried on in the
 London interbank eurodollar market. 

          “Capital
Expenditure” means, for any period, the aggregate amount of (x) any
expenditure of the Borrower or any Subsidiaries for fixed or capital assets
made during such period which, in accordance with GAAP, would be classified as
a capital expenditure and (y) any Capitalized Lease Liability incurred by the Borrower
and its Subsidiaries during such period. 

-4-

          “Capital
Security” means, with respect to any Person, any share, interest,
participation or other equivalent (however designated, whether voting or
non-voting) of such Person’s capital, whether now outstanding or issued after
the Effective Date. 

          “Capitalized
Lease Liability” means, with respect to any Person, any monetary obligation
of such Person and its Subsidiaries under any leasing or similar arrangement
which has been (or, in accordance with GAAP, should be) classified as a
capitalized lease, and for purposes of each Loan Document the amount of such
obligation shall be the capitalized amount thereof, determined in accordance
with GAAP, and the stated maturity thereof shall be the date of the last
payment of rent or any other amount due under such lease prior to the first
date upon which such lease may be terminated by the lessee without payment of a
premium or a penalty. 

          “Cash
Equivalent Investment” means, at any time: 

	
 

	
 

	
 

	
 

	
          (a)
 any direct obligation of (or unconditionally guaranteed by) the United States
 or a State thereof (or any agency or political subdivision thereof, to the
 extent such obligations are supported by the full faith and credit of the
 United States or a State thereof) maturing not more than one year after such
 time; 

	
 

	
 

	
 

	
 

	
          (b)
 commercial paper maturing not more than 270 days from the date of issue,
 which is issued by 

	
 

	
 

	
 

	
 

	
 

	
          (i)
 a corporation (other than an Affiliate of any Obligor) organized under the
 laws of any State of the United States or of the District of Columbia and
 rated A-1 or higher by S&P, P-1 or higher by Moody’s, or F-1 or higher
 from Fitch or 

	
 

	
 

	
 

	
 

	
 

	
          (ii)
 any Lender (or its holding company); 

	
 

	
 

	
 

	
 

	
          (c)
 any certificate of deposit, time deposit or bankers acceptance, maturing not
 more than one year after its date of issuance, which is issued by 

	
 

	
 

	
 

	
 

	
 

	
          (i)
 any bank organized under the laws of the United States (or any State thereof)
 and which has (x) a credit rating of A2 or higher from Moody’s, A or higher
 from S&P or A or higher from Fitch and (y) a combined capital and surplus
 greater than $500,000,000, or 

	
 

	
 

	
 

	
 

	
 

	
          (ii)
 any Lender, or 

	
 

	
 

	
 

	
 

	
 

	
          (iii)
 Idaho Independent Bank (provided that the aggregate amount invested in
 all such certificates of deposit, time deposit and bankers acceptances issued
 by Idaho Independent Bank at any time shall not exceed $20,000,000); or 

	
 

	
 

	
 

	
 

	
          (d)
 any repurchase agreement having a term of 30 days or less entered into with
 any Lender or any commercial banking institution satisfying the criteria set
 forth in clause (c)(i) which 

	
 

	
 

	
 

	
 

	
 

	
          (i)
 is secured by a fully perfected security interest in any obligation of the
 type described in clause (a), and 

-5-

	
 

	
 

	
 

	
 

	
 

	
          (ii)
 has a market value at the time such repurchase agreement is entered into of
 not less than 100% of the repurchase obligation of such commercial banking
 institution thereunder. 

          “Casualty
Event” means the damage or destruction or any taking under power of eminent
domain or by condemnation or similar proceeding, as the case may be, of
property of any Person or any of its Subsidiaries. 

          “CERCLA”
means the Comprehensive Environmental Response, Compensation and Liability Act
of 1980, as amended. 

          “CERCLIS”
means the Comprehensive Environmental Response Compensation Liability
Information System List. 

          “Change
in Control” means 

	
 

	
 

	
 

	
          (a)
 at any time any Person or Persons acting in concert, shall become the
 “beneficial holder” (as defined in Rules 13d-3 and 13d-5 under the Exchange
 Act), directly or indirectly, of Voting Securities of the Borrower
 representing more than 50% of the issued and outstanding Voting Securities of
 the Borrower on a fully diluted basis; 

	
 

	
 

	
 

	
          (b)
 during any period of 24 consecutive months commencing on or after the
 Effective Date, individuals who at the beginning of such period constituted
 the Board of Directors of the Borrower (together with any new directors whose
 election to such Board or whose nomination for election by the stockholders
 of the Borrower was approved by a vote of a majority of the directors then
 still in office who were either 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 the Board of Directors of the
 Borrower then in office; 

	
 

	
 

	
 

	
          (c)
 the occurrence of any “Change in Control” (or similar term) under (and as
 defined in) any Subordinated Debt Document or Designated Preferred Stock
 Document or 

	
 

	
 

	
 

	
          (d)
 the failure of the Borrower at any time to directly or indirectly own
 beneficially and of record on a fully diluted basis 100% of the outstanding
 Capital Securities of each Subsidiary Guarantor, such Capital Securities to
 be held free and clear of all Liens (other than Liens permitted pursuant to clauses
 (a), (h) and (j) of Section 7.2.3). 

          “Code”
means the Internal Revenue Code of 1986, and the regulations thereunder, in
each case as amended, reformed or otherwise modified from time to time. 

          “Commitment”
means with respect to each Lender, such Lender’s obligations to make its Loans
pursuant to Section 2.1. 

          “Commitment
Amount” means, as the context may require, the Term I Loan Commitment
Amount and the Term II Loan Commitment Amount. 

-6-

          “Compliance
Certificate” means a certificate duly completed and executed by an
Authorized Officer of the Borrower, substantially in the form of Exhibit E
hereto, together with such changes thereto as the Administrative Agent may from
time to time request for the purpose of monitoring the Borrower’s compliance
with the financial covenants contained herein.  

          “Contingent
Liability” means any agreement, undertaking or arrangement by which any
Person guarantees, endorses or otherwise becomes or is contingently liable upon
(by direct or indirect agreement, contingent or otherwise, to provide funds for
payment, to supply funds to, or otherwise to invest in, a debtor, or otherwise
to assure a creditor against loss) the Indebtedness of any other Person (other
than by endorsements of instruments in the course of collection), or guarantees
the payment of dividends or other distributions upon the Capital Securities of
any other Person or is liable to maintain the solvency or any balance sheet
item, level of income or financial condition of any other Person for the
purpose of assuring a creditor against loss. The amount of any Person’s
obligation under any Contingent Liability shall (subject, however, to any
limitation set forth therein) be deemed to be the outstanding principal amount
of the debt, obligation or other liability guaranteed thereby. 

          “Continuation/Conversion
Notice” means a notice of continuation or conversion and certificate duly
executed by an Authorized Officer of the Borrower, substantially in the form of
Exhibit C hereto. 

          “Controlled
Group” means all members of a controlled group of corporations and all
members of a controlled group of trades or businesses (whether or not
incorporated) under common control which, together with the Borrower, are
treated as a single employer under Section 414(b) or 414(c) of the Code or
Section 4001 of ERISA. 

          “Credit
Extension” means the making of Loans by a Lender. 

          “Current
Assets” means the total assets which would properly be classified in
accordance with Section 1.5 as consolidated current assets of the
Borrower and its Subsidiaries. 

          “Current
GAAP Financials” is defined in Section 1.5. 

          “Current
Liabilities” means the total liabilities which would properly be classified
in accordance with Section 1.5 as consolidated current liabilities of
the Borrower and its Subsidiaries (other than the Term II Loans and the current
portion of outstanding Indebtedness of the Borrower and its Subsidiaries that
matures more than one year from the date of its creation (including, without
limitation, the current portion of the Term I Loans) or matures within one year
from such date and is renewable or extendable, at the option of the Borrower or
one of its Subsidiaries, to a date more than one year from such date). 

	
 

	
 

	
 

	
“Current
  Ratio” means, at any time, the ratio of: 

	
 

	
 

	
 

	
          (a)
  Current Assets at such time; 

	
 

	
 

	
 

	
to  

	
 

	
 

	
 

	
          (b)
  Current Liabilities at such time. 

-7-

          “Default”
means any Event of Default or any condition, occurrence or event which, after
notice or lapse of time or both, would constitute an Event of Default. 

          “Designated
Preferred Stock” means preferred stock of the Borrower (a) which does not
require any scheduled redemption within one year following the Stated Maturity
Date of the Term I Loans, (b) with respect to which dividends may not be
declared, paid or funds set aside for payment thereof following the occurrence
and during the continuance of a Default and (c) either contains (i) terms that
are not more onerous on the Borrower than the terms of its Series B Preferred
Stock or (ii) covenants, redemption events, redemption provisions and other
terms that are, in the reasonable judgment of the Required Lenders, customary
for comparable issuances of preferred stock. 

          “Designated
Preferred Stock Documents” means, collectively, the certificate of
designations, purchase agreements and other instruments and agreements
evidencing the terms of Designated Preferred Stock, as amended, supplemented,
amended and restated or otherwise modified in accordance with Section 7.2.11.

          “Disclosure
Schedule” means the Disclosure Schedule attached hereto as Schedule I, as
it may be amended, supplemented, amended and restated or otherwise modified
from time to time by the Borrower with the written consent of the Required
Lenders.  

          “Disposition”
(or similar words such as “Dispose”) means, with respect to any Person,
any sale, transfer, lease, contribution or other conveyance (including by way
of merger) of, or the granting of options, warrants or other rights to, any of
such Person’s assets (including accounts receivable and Capital Securities of
such Person’s Subsidiaries) or Approvals to any other Person in a single
transaction or series of transactions. 

          “Dollar”
and the sign “$” mean lawful money of the United States. 

          “Domestic
Office” means, relative to any Lender, the office of such Lender designated
as its “Domestic Office” on Schedule II or in a Lender Assignment
Agreement, or such other office within the United States as may be designated
from time to time by notice from such Lender to the Administrative Agent and
the Borrower. 

	
 

	
 

	
 

	
“Earn-out
  Obligations” is defined in the definition of Indebtedness. 

	
 

	
 

	
 

	
“EBITDA”
  means, for any applicable period, the sum of 

	
 

	
 

	
 

	
          (a)
  Net Income (exclusive of all amounts in respect of any gains and losses
  realized from Dispositions other than inventory Disposed of in the ordinary
  course of business), plus

	
 

	
 

	
 

	
          (b)
  to the extent deducted in determining Net Income, the sum, without
  duplication, of (i) amounts attributable to amortization and depreciation of
  assets, (ii) income tax expense, (iii) Interest Expense, (iv) non-cash
  charges (other than write-downs of accounts receivable), (v) expenses paid in
  respect of any consummated Permitted Acquisition to the extent such expenses
  previously would have been permitted to be capitalized in accordance with
  GAAP as in effect on December 31, 2007 and (vi) any 

-8-

	
 

	
 

	
 

	
cash foreign
currency exchange losses in respect of dividends, distributions or
inter-company payments made in the 2008 Fiscal Year by a Subsidiary organized
and existing under, or otherwise subject to, the laws of Venezuela, minus  

	
 

	
 

	
 

	
          (c)
to the extent added in determining Net Income, the sum, without duplication,
of (i) interest income paid during such period to the Borrower and its
Subsidiaries, (ii) non-cash gains, (iii) the income of any Person (other than
a Subsidiary of the Borrower) in which the Borrower or any of its
Subsidiaries has an ownership interest, except to the extent that any such
income is actually received by the Borrower or such Subsidiary in the form of
dividends or similar distributions, (iv) the income of any Subsidiary of the
Borrower 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 the Loan Documents) or
requirement of law applicable to such Subsidiary, (v) the income (or deficit)
of any Person accrued prior to the date it became a Subsidiary of, or was
merged or consolidated into, the Borrower or any of the Borrower’s
Subsidiaries and (vi) any restoration to income of any contingency reserve,
except to the extent that provision for such reserve was made out of income
accrued during such period, minus  

	
 

	
 

	
 

	
          (d)
  the amount of all cash payments made in such period to the extent that such
  payments relate to a non-cash charge incurred in a previous period that was
  added back in determining EBITDA hereunder pursuant to the preceding clause
  (b)(iv); 

          provided that to the extent any such period
includes the Fiscal Quarters ending on June 30, 2007, September 30, 2007,
December 31, 2007, March 31, 2008 or June 30, 2008, EBITDA for each such Fiscal
Quarter shall be deemed to be the applicable Plug Amount. 

          “Effective
Date” means the date this Agreement becomes effective pursuant to Section
10.8. 

          “Effective
Date Certificate” means the effective date certificate executed and
delivered by an Authorized Officer of the Borrower, substantially in the form
of Exhibit D hereto. 

          “El
Callao Gold” means El Callao Gold Mining Company, a Delaware corporation. 

          “Eligible
Assignee” means (a) a Lender; (b) an Affiliate of a Lender; (c) an Approved
Fund; or (d) any other Person (other than a natural Person, the Borrower, any
Affiliate of the Borrower or any other Person taking direction from, or working
in concert with, the Borrower or any of the Borrower’s Affiliates). 

          “Environmental
Law” means all present and future Applicable Laws imposing liability or
standards of conduct relating to the environment, industrial hygiene, land use
or the protection of human health and safety, natural resources, pollution
(including Hazardous Materials) or waste management, including laws relating to
reclamation of land and waterways. 

          “Equity
Incentive Plans” means the Hecla Mining Company 1995 Stock Incentive Plan,
as amended, the Hecla Mining Company Stock Plan for Nonemployee Directors, as
amended, and the Hecla Mining Company Key Employee Deferred Compensation Plan,
as amended. 

-9-

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

          “Event
of Default” is defined in Section 8.1.  

          “Excess
Cash Flow” means, for any Fiscal Year, the excess (if any), of

	
 

	
 

	
 

	
          (x)
  EBITDA for such Fiscal Year; 

	
 

	
 

	
 

	
minus

	
 

	
 

	
 

	
          (y)
  the sum (for such Fiscal Year) of (A) Interest Expense actually paid in cash
  by the Borrower and Subsidiaries, plus (B) principal repayments, to
  the extent actually made, of Loans pursuant to clauses (a) or (b)
  of Section 3.1.1 or upon the Stated Maturity Date of such Loans (excluding,
  however, repayments made from a refinancing of any portion of such
  Indebtedness, or pursuant to any other clause of Section 3.1.1
  (including on the Stated Maturity Date thereof)) plus (C) all income
  Taxes actually paid in cash by the Borrower and Subsidiaries plus (D)
  Capital Expenditures made in cash (excluding, however, Capital
  Expenditures financed with the proceeds of Indebtedness, equity issuances,
  casualty proceeds or other proceeds which are not included in EBITDA) plus
  (E) reclamation expenses actually paid in cash by the Borrower and its
  Subsidiaries (excluding, however, reclamation expenses financed
  with the proceeds of insurance). 

	
 

	
 

	
 

	
“Exchange
  Act” means the Securities Exchange Act of 1934, as amended. 

	
 

	
 

	
 

	
“Exemption
  Certificate” is defined in clause (e) of Section 4.6. 

          “Federal
Funds Rate” means, for any period, a fluctuating interest rate per annum equal
for each day during such period to  

	
 

	
 

	
 

	
          (a)
  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 for such day (or, if such day is not a Business Day, for the
  next preceding Business Day) by the Federal Reserve Bank of New York; or 

	
 

	
 

	
 

	
          (b)
  if such rate is not so published for any day which is a Business Day, the
  average of the quotations for such day on such transactions received by the
  Administrative Agent from three federal funds brokers of recognized standing
  selected by it. 

          “Fee
Letter” means the confidential amended and restated fee letter, dated April
15, 2008, between Scotiabank and the Borrower. 

          “Filing
Agent” is defined in Section 5.1.10. 

          “Filing
Statements” is defined in Section 5.1.10. 

-10-

          “Fiscal
Quarter” means a quarter ending on the last day of March, June, September
or December. 

          “Fiscal
Year” means any period of twelve consecutive calendar months ending on
December 31; references to a Fiscal Year with a number corresponding to any
calendar year (e.g., the “2008 Fiscal Year”) refer to the Fiscal Year
ending on December 31 of such calendar year.  

          “Fitch”
means Fitch, Inc. 

          “Foreign
Pledge Agreement” means any supplemental pledge agreement governed by the
laws of a jurisdiction other than the United States or a State thereof executed
and delivered by the Borrower or any Subsidiary pursuant to the terms of this
Agreement, in form and substance satisfactory to the Administrative Agent, as
may be necessary or desirable under the laws of organization or incorporation
of a Subsidiary to further protect or perfect the Lien on any Collateral (as
defined in the Security Agreement). 

          “Foreign
Subsidiary” means any Subsidiary that is not a U.S. Subsidiary. 

          “F.R.S.
Board” means the Board of Governors of the Federal Reserve System or any
successor thereto. 

          “GAAP”
is defined in Section 1.5.  

          “Governmental
Authority” means the government of the United States, any other nation or
any political subdivision thereof, whether state or local, and any agency,
authority, instrumentality, regulatory body, court, central bank or other
Person exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government. 

          “Greens
Creek Group” means, collectively, the Greens Creek Participants and Hecla
Admiralty. 

          “Greens
Creek Joint Venture” means the joint venture among the Greens Creek
Participants as governed by the terms of the Greens Creek Joint Venture
Agreement. 

          “Greens
Creek Joint Venture Agreement” means the Restated Mining Venture Agreement,
dated as of May 6, 1994, by and among Kennecott, the Borrower and Kennecott
Juneau (as successor to CSX Alaska Mining Co., a Delaware corporation), as
amended, supplemented, amended and restated or otherwise modified from time to
time in accordance with the terms thereof and hereof. 

          “Greens
Creek Manager” means Kennecott, or any successor manager appointed under
the Greens Creek Joint Venture Agreement. 

          “Greens
Creek Mine” means the mine located on Admiralty Island, near Juneau,
Alaska, that is owned and operated pursuant to the Greens Creek Joint Venture
Agreement by the Greens Creek Participants. 

-11-

          “Greens
Creek Participants” means, collectively, Hecla Alaska, Kennecott and
Kennecott Juneau. 

          “Hazardous
Material” means (w) any substances that are defined or listed in, or
otherwise classified pursuant to, any applicable Environmental Laws as
“hazardous substances”, “hazardous materials”, “hazardous wastes”, “toxic
substances”, “contaminants”, “pollutants” or any other formulation intended to
define, list or classify substances by reason of adverse effects on the
environment or deleterious properties such as ignitability, corrosivity,
reactivity, carcinogenicity, reproductive toxicity or “TLCP” toxicity or “EP”
toxicity; (x) any oil, petroleum or petroleum-derived substances, natural gas,
natural gas liquids or synthetic gas and drilling fluids, produced waters and
other wastes associated with the exploration, development or production of
crude oil, natural gas or geothermal resources; (y) any flammable substances or
explosives or any radioactive materials; or (z) any asbestos in any form or
electrical equipment which contains any oil or dielectric fluid containing
levels of polychlorinated biphenyls in excess of fifty parts per million. 

          “Hecla
Admiralty” means Hecla Admiralty Company, a Delaware corporation.

          “Hecla Alaska” means Hecla Alaska LLC, a Delaware limited liability company. 

          “Hecla Limited” means Hecla Limited, a Delaware corporation.  

          “Hecla
Mine Plan” means, with respect to all mines controlled by the Borrower
(including any of its Subsidiaries), a life of mine plan prepared by the
Borrower setting forth on a consolidated basis and separately with respect to
each mine, inter alia, annual operating, capital and exploration budgets;
proposed construction, development, operation and closing of such mines and any
rehabilitation or reclamation work related thereto; exploitation, treatment,
production, marketing and sale of all metals recovered from such mines; and all
administrative, technical, financial and commercial activities related thereto.
The Hecla Mine Plan shall be updated annually and delivered to the
Administrative Agent, in each case in accordance with clause (l) of Section 7.1.1.  

          “Hedging
Agreements” means currency exchange agreements, interest rate swap
agreements, interest rate cap agreements, interest rate collar agreements,
commodity hedging agreements, commodity swap, exchange or futures agreements,
and all other agreements or arrangements designed to protect such Person
against fluctuations in interest rates, currency exchange rates or commodity
prices. 

          “Hedging
Obligations” means, with respect to any Person, all liabilities of such
Person under Hedging Agreements. 

          “Immaterial
Subsidiary” means, on any date, a Subsidiary of the Borrower which (a) was
not designated as a “Material Subsidiary” on Item 1.1(a) of the
Disclosure Schedule or (b) is notified to the Lenders as being an “Immaterial
Subsidiary” pursuant to a certificate executed by an Authorized Officer of the
Borrower certifying to each of the items set forth in the immediately
succeeding proviso; provided that a Subsidiary shall not be an
Immaterial Subsidiary if (i) its assets exceeded $2,000,000 as of the last day
of the most recently completed Fiscal Quarter, (ii) its revenues exceeded
$1,000,000 for the most recently completed Fiscal Quarter, (iii) the assets 

-12-

of all
Immaterial Subsidiaries exceeded $10,000,000 as of the last day of the most
recently completed Fiscal Quarter, (iv) the aggregate revenue of all Immaterial
Subsidiaries exceeded $2,000,000 for the most recently completed Fiscal Quarter
or (v) the Borrower or any Material Subsidiary is providing any credit support
for, or a guarantee of, any obligations of such Subsidiary; provided further
that, in the event all Subsidiaries otherwise designated as Immaterial
Subsidiaries by the Borrower should not be Immaterial Subsidiaries as a result
of clause (iii) or (iv) of the immediately preceding proviso and
the Borrower has not designated which Subsidiary (or Subsidiaries) should no
longer constitute Immaterial Subsidiaries pursuant to the Compliance
Certificate most recently delivered pursuant to clause (c) of Section
7.1.1 or notice delivered pursuant to Section 7.1.10, the
Administrative Agent may designate which Subsidiary (or Subsidiaries) no longer
constitute Immaterial Subsidiaries. In no event shall a Subsidiary Guarantor be
an Immaterial Subsidiary; provided further that neither Hecla
Limited nor any Person in the Greens Creek Group shall be an Immaterial
Subsidiary. 

          “Impermissible
Qualification” means any qualification or exception to the opinion or
certification of any independent public accountant as to any financial
statement of the Borrower 

	
 

	
 

	
 

	
          (a)
  which is of a “going concern” or similar nature; 

	
 

	
 

	
 

	
          (b)
  which relates to the limited scope of examination of matters relevant to such
  financial statement; 

	
 

	
 

	
 

	
          (c)
  which relates to the treatment or classification of any item in such
  financial statement and which, as a condition to its removal, would require
  an adjustment to such item the effect of which would be to cause the Borrower
  to be in Default; or 

	
 

	
 

	
 

	
          (d)
  which, to the extent the Borrower shall be subject to the provisions of
  Sarbanes-Oxley and the rules and regulations of the SEC promulgated
  thereunder, relates to an attestation report of such independent public
  accountant as to the Borrower’s internal controls over financial reporting
  pursuant to Section 404 of Sarbanes-Oxley, except to the extent any such
  qualification or exception (i) is permitted under rules or regulations
  promulgated by the SEC or the Public Company Accounting Oversight Board, (ii)
  has appeared in the attestation report described in the Borrower’s Annual
  Report on Form 10-K for the 2007 Fiscal Year, (iii) does not, in the
  reasonable judgment of the Required Lenders, create a reasonable doubt as to
  the accuracy of any item or items in the financial statements furnished by
  the Borrower that, if corrected, would cause the Borrower to be in Default or
  (iv) is otherwise acceptable to the Required Lenders. 

	
 

	
 

	
 

	
“Indebtedness”
  of any Person means, without duplication: 

	
 

	
 

	
 

	
          (a)
  all obligations of such Person for borrowed money or advances or borrowed
  metals and all obligations of such Person evidenced by bonds, debentures,
  notes or similar instruments (including performance and reclamation bonds); 

	
 

	
 

	
 

	
          (b)
  all obligations, contingent or otherwise, relative to the face amount of all
  letters of credit, whether or not drawn, and banker’s acceptances issued for
  the account of such Person; 

-13-

	
 

	
 

	
 

	
          (c)
  all Capitalized Lease Liabilities of such Person; 

	
 

	
 

	
 

	
          (d)
  for purposes of Section 8.1.5 only, all other items which, in
  accordance with GAAP, would be included as indebtedness on the liabilities
  side on the balance sheet of such Person as of the date at which Indebtedness
  is to be determined; 

	
 

	
 

	
 

	
          (e)
  net Hedging Obligations of such Person; 

	
 

	
 

	
 

	
          (f)
whether or not so included as liabilities in accordance with GAAP, (i) all
obligations of such Person to pay the deferred purchase price of property or
services (excluding trade accounts payable in the ordinary course of business
which are not overdue for a period of more than 90 days or, if overdue for more
than 90 days, as to which a dispute exists and adequate reserves in
conformity with GAAP have been established on the books of such Person),
including obligations of such Person (“Earn-out Obligations”) in respect of
“earn-outs” or other similar contingent payments (whether based on revenue or
otherwise) arising from the acquisition of a business or line of business
pursuant to a Permitted Acquisition and payable to the seller or sellers
thereof, and (ii) indebtedness secured by (or for which the holder of such
indebtedness has an existing right, contingent or otherwise, to be secured
by) a Lien on property owned or being acquired by such Person (including
indebtedness arising under conditional sales or other title retention
agreements), whether or not such indebtedness shall have been assumed by such
Person or is limited in recourse;  

	
 

	
 

	
 

	
          (g)
  obligations arising under Synthetic Leases; 

	
 

	
 

	
 

	
          (h)
  the stated liquidation value of Redeemable Capital Securities of such Person;
  and 

	
 

	
 

	
 

	
          (i)
  all Contingent Liabilities of such Person in respect of any of the foregoing.
  

          The
Indebtedness of any Person shall include the Indebtedness of any other Person
(including any partnership in which such Person is a general partner) to the
extent such Person is liable therefor as a result of such Person’s ownership
interest in or other relationship with such Person, except to the extent the
terms of such Indebtedness provide that such Person is not liable therefor. 

          “Indemnified
Liabilities” is defined in Section 10.4. 

          “Indemnified
Parties” is defined in Section 10.4.  

          “Independence
Lead Mine Acquisition” means the acquisition by the Borrower of all of the
assets of Independence Lead Mines Company (“ILM”) in exchange for
6,936,884 shares of Capital Securities of the Borrower to be distributed to the
shareholders of ILM pursuant to the terms of that certain Asset Purchase
Agreement by and among ILM, the Borrower and Hecla Merger Company dated as of
February 13, 2008. 

          “Interco
Subordination Agreement” means the Subordination Agreement, substantially
in the form of Exhibit I hereto, executed and delivered by two or more
Obligors pursuant to the 

-14-

terms of this
Agreement, as amended, supplemented, amended and restated or otherwise modified
from time to time. 

          “Interest
Coverage Ratio” means, as of the last day of any Fiscal Quarter, the ratio,
computed for the period consisting of such Fiscal Quarter and each of the three
immediately preceding Fiscal Quarters, of: 

	
 

	
 

	
 

	
          (a)
  EBITDA for such period; 

	
 

	
 

	
 

	
to 

	
 

	
 

	
 

	
          (b)
  Interest Expense (other than Interest Expense attributable to the Term II
  Loans) for such period; provided, however,
  that, in the event such period would include any Fiscal Quarter commencing
  prior to the Effective Date, Interest Expense shall be (i) if determined
  at any time prior to the date the Compliance Certificate for the Fiscal
  Quarter ending on September 30, 2008 is delivered (or the date on which such
  Compliance Certificate is required to be delivered) pursuant to clause (c)
  of Section 7.1.1, the relevant Plug Amount, and (ii) with respect to
  any period thereafter, determined on an Annualized Basis. 

          “Interest
Expense” means, for any applicable period, calculated in accordance with
Section 1.5, the aggregate interest expense of the Borrower and its
Subsidiaries for such applicable period, including and together with (i) the
portion of any payments made in respect of Capitalized Lease Liabilities
allocable to interest expense and (ii) dividends declared on Designated
Preferred Stock (except to the extent payable in additional shares of
Designated Preferred Stock or shares of the Borrower’s common stock).  

          “Interest
Period” means, relative to any LIBO Rate Loan, the period beginning on (and
including) the date on which such LIBO Rate Loan is made or continued as, or
converted into, a LIBO Rate Loan pursuant to Sections 2.2 or 2.4
and shall end on (but exclude) the day which numerically corresponds to such
date one, two, three or six months thereafter (or, if such month has no
numerically corresponding day, on the last Business Day of such month), as the
Borrower may select in its relevant notice pursuant to Sections 2.2 or 2.4;
provided that, 

	
 

	
 

	
 

	
          (a)
  the Borrower shall not be permitted to select Interest Periods to be in
  effect at any one time which have expiration dates occurring on more than
  five different dates; 

	
 

	
 

	
 

	
          (b)
  if such Interest Period would otherwise end on a day which is not a Business
  Day, such Interest Period shall end on the next following Business Day
  (unless such next following Business Day is the first Business Day of a
  calendar month, in which case such Interest Period shall end on the Business Day
  next preceding such numerically corresponding day); 

	
 

	
 

	
 

	
          (c)
  no Interest Period shall be longer than one month during the Primary
  Syndication; and 

	
 

	
 

	
 

	
          (d)
  no Interest Period for any Loan may end later than the Stated Maturity Date for
  such Loan. 

-15-

          “Investment”
means, relative to any Person, 

	
 

	
 

	
 

	
          (a)
  any loan, advance or extension of credit made by such Person to any other
  Person, including the purchase by such Person of any bonds, notes, debentures
  or other debt securities of any other Person; 

	
 

	
 

	
 

	
          (b)
  Contingent Liabilities in favor of any other Person; 

	
 

	
 

	
 

	
          (c)
  any Capital Securities held by such Person in any other Person; and 

	
 

	
 

	
 

	
          (d)
  the purchase or other acquisition (in one transaction or a series of
  transactions) of material assets of another Person other than in the ordinary
  course of business. 

          The
amount of any Investment shall be excess of the original principal or capital
amount thereof minus all realized returns of principal or equity thereon
and shall, if made by the transfer or exchange of property other than cash, be
deemed to have been made in an original principal or capital amount equal to
the fair market value of such property at the time of such Investment. 

          “Isidora
Mine” means the mine that is located in the eastern Venezuelan State of
Bolivar, and that is owned and operated through the Subsidiaries Minera Hecla
Venezolana, C.A. (since June 1999) and El Callao Gold (since 2002) and is
operated in conjunction with the La Camorra Mine. 

          “Kennecott”
means Kennecott Greens Creek Mining Company, a Delaware corporation. 

          “Kennecott
Holdings” means Kennecott Minerals Holdings Company, a Delaware
corporation. 

          “Kennecott
Juneau” means Kennecott Juneau Mining Company, a Delaware corporation. 

          “La
Camorra Mine” means the mine that is located in the eastern Venezuelan
State of Bolívar, and that is owned and operated through the Subsidiary Minera
Hecla Venezolana, C.A. and is operated in conjunction with the Isidora Mine. 

          “Land
Exchange Agreement” means the Land Exchange Agreement, dated as of December
14, 1994, between Kennecott and the United States, by and through the U.S.
Department of Agriculture Forest Service, as amended or otherwise modified from
time to time. 

          “Lead
Arranger” is defined in the preamble. 

          “Lender
Assignment Agreement” means an assignment agreement substantially in the
form of Exhibit J hereto.  

          “Lender
Hedging Agreement” means any Hedging Agreement entered into by the Borrower
under which the counterparty of such agreement is a Lender, the Administrative
Agent, or an Affiliate of a Lender or the Administrative Agent. 

-16-

          “Lenders”
is defined in the preamble.  

          “Lender’s
Environmental Liability” means any and all losses, liabilities,
obligations, penalties, claims, litigation, demands, defenses, costs,
judgments, suits, proceedings, damages (including consequential damages),
reasonable disbursements or expenses of any kind or nature whatsoever
(including reasonable attorneys’ fees at trial and appellate levels and
reasonable experts’ fees and disbursements and expenses incurred in
investigating, defending against or prosecuting any litigation, claim or
proceeding) which may at any time be imposed upon, incurred by or asserted or
awarded against the Administrative Agent or any Lender or any of such Person’s
Affiliates, shareholders, directors, officers, employees, and agents in
connection with or arising from: 

	
 

	
 

	
 

	
          (a)
  any Hazardous Material on, in, under or affecting all or any portion of any
  property of the Borrower or any of its Subsidiaries, the groundwater
  thereunder, or any surrounding areas thereof to the extent caused by Releases
  from the Borrower’s or any of its Subsidiaries’ or any of their respective
  predecessors’ properties; 

	
 

	
 

	
 

	
          (b)
  any misrepresentation, inaccuracy or breach of any warranty, contained or
  referred to in Section 6.12 (without regard to “knowledge” or
  “materiality” qualifications or exceptions contained in such representations
  or warranties); 

	
 

	
 

	
 

	
          (c)
  any violation or claim of violation by the Borrower or any of its
  Subsidiaries of any Environmental Laws; or 

	
 

	
 

	
 

	
          (d)
  the imposition of any lien for damages caused by or the recovery of any costs
  for the cleanup, release or threatened release of Hazardous Material by the
  Borrower or any of its Subsidiaries, or in connection with any property owned
  or formerly owned by the Borrower or any of its Subsidiaries. 

	
 

	
 

	
 

	
“Leverage
  Ratio” means, as of the last day of any Fiscal Quarter, the ratio of 

	
 

	
 

	
 

	
          (a)
  Total Net Debt outstanding on the last day of such Fiscal Quarter; 

	
 

	
 

	
 

	
to

	
 

	
 

	
 

	
          (b)
  EBITDA computed for the period consisting of such Fiscal Quarter and each of
  the three immediately preceding Fiscal Quarters. 

          “LIBO
Rate” means, relative to any Interest Period for LIBO Rate Loans, the rate
per annum for any Interest Period fixed each day at 11:00 a.m. (London time)
determined by the British Bankers Association as the London Interbank Offered
Rate for dollar deposits and published at Reuters Screen LIBOR01 Page two
Business Days prior to the commencement of such Interest Period (rounded
upward, if necessary, to the nearest 1/16th of 1%); provided, however,
that, in the event that such rate is not available on Reuters Screen LIBOR01
Page, the “LIBO Rate” shall be determined by reference to such other comparable
publicly available service for displaying eurodollar rates as may be selected
by the Administrative Agent or, in the absence of such availability, by
reference to the rate per annum at which the Administrative Agent is offering
Dollar deposits of comparable amounts at or about 10:00 a.m., New York time,

-17-

 two Business Days prior to the beginning of
such Interest Period in the interbank eurodollar market where its eurodollar
and foreign currency and exchange operations are then being conducted for
delivery in immediately available funds on the first day of such Interest
Period for the number of days comprised therein. 

          “LIBO
Rate Loan” means a Loan bearing interest, at all times during an Interest
Period applicable to such Loan, at a rate of interest determined by reference
to the LIBO Rate (Reserve Adjusted). 

          “LIBO
Rate (Reserve Adjusted)” means, relative to any Loan to be made, continued
or maintained as, or converted into, a LIBO Rate Loan for any Interest Period,
a rate per annum (rounded upwards, if necessary, to the nearest 1/16 of 1%)
determined pursuant to the following formula: 

	
 

	
 

	
 

	
 

	
 

	
 

	
LIBO
  Rate

	
=

	
LIBO
  Rate 

	
 

	
 

	
 

	
 
	
 

	
 

	
(Reserve
  Adjusted)

	
1.00
  - LIBOR Reserve Percentage

	
 

          The
LIBO Rate (Reserve Adjusted) for any Interest Period for LIBO Rate Loans will
be determined by the Administrative Agent on the basis of the LIBOR Reserve
Percentage in effect two Business Days before the first day of such Interest
Period. 

          “LIBOR
Office” means, relative to any Lender, the office of a Lender designated as
its “LIBOR Office” on Schedule II or in a Lender Assignment Agreement, or such
other office designated from time to time by notice from such Lender to the
Borrower and the Administrative Agent, whether or not outside the United States,
which shall be making or maintaining the LIBO Rate Loans of such Lender.  

          “LIBOR
Reserve Percentage” means, relative to any Interest Period for LIBO Rate
Loans, the reserve percentage (expressed as a decimal) equal to the maximum
aggregate reserve requirements (including all basic, emergency, supplemental,
marginal and other reserves and taking into account any transitional
adjustments or other scheduled changes in reserve requirements) specified under
regulations issued from time to time by the F.R.S. Board and then applicable to
assets or liabilities consisting of or including “Eurocurrency Liabilities”, as
currently defined in Regulation D of the F.R.S. Board, having a term
approximately equal or comparable to such Interest Period. 

          “Lien”
means any security interest, mortgage, pledge, hypothecation, assignment,
deposit arrangement, encumbrance, lien (statutory or other) or preference,
priority or other security agreement, whether or not filed, recorded or
otherwise perfected under Applicable Law (including without limitation, any
encumbrance arising with respect to any mineral royalty or similar obligation).

          “Loans”
means the Term I Loans and the Term II Loans. 

          “Loan
Documents” means, collectively, this Agreement, the Notes, the Fee Letter,
the Security Agreement, the Pledge Agreement and each other agreement pursuant
to which the Administrative Agent is granted a Lien to secure the Obligations,
the Subsidiary Guaranty, and 

-18-

each other
agreement, certificate, document or instrument (other than any Lender Hedging
Agreement) delivered in connection with any Loan Document, whether or not
specifically mentioned herein or therein. 

          “Lucky
Friday Mine” means the deep underground silver, lead and zinc mine located
in the Coeur d’Alene Mining District in northern Idaho one-quarter mile east of
Mullan, Idaho, and that is owned and operated by Hecla Limited. 

          “Material
Adverse Change” means any change since December 31, 2007, or any additional
information disclosed to or discovered since December 31, 2007, that has had or
could reasonably be expected, individually or in the aggregate, to have a
Material Adverse Effect. 

          “Material
Adverse Effect” means a material adverse effect on (a) the business,
operations, assets or financial condition of the Borrower or the Borrower and
its Subsidiaries taken as a whole, (b) the rights and remedies of any Secured
Party under any Loan Document or (c) the ability of any Obligor to perform its
Obligations under any Loan Document. 

          “Material
Contract” means, relative to any Obligor, each contract (other than any
Loan Document or Lender Hedging Agreement) to which such Obligor is a party or
by which any of its property is bound or subject involving aggregate
consideration payable to or by it of $10,000,000 or more in any Fiscal Year or
otherwise material to the business or operations of the Borrower or
Subsidiaries. 

          “Material
Subsidiary” means, on any date, a Subsidiary of the Borrower which is not
an Immaterial Subsidiary. 

          “Material
U.S. Subsidiary” means, on any date, a Material Subsidiary of the Borrower
that is a U.S. Subsidiary. 

          “Mining
Rights” means all interests in the surface of any lands, the minerals in (or
that may be extracted from) any lands, all royalty agreements, water rights,
patented and unpatented mining and millsite claims, fee interests, mineral
leases, mining licenses, profits-a-prendre, joint ventures and other leases,
rights-of-way, inurements, licenses and other rights and interests used by or
necessary to (x) the Greens Creek Joint Venture to operate the Greens Creek
Mine or (y) the Borrower and its Subsidiaries in the conduct of their mining
and related processing operations. 

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

          “Multiemployer
Plan” means a “multiemployer plan” as defined in Section 4001(a)(3) of
ERISA for which the Borrower or any member of its Controlled Group has
contributed to, or has been obligated to contribute to, at any time during the
preceding six (6) years. 

          “Net
Casualty Proceeds” means, relative to any Casualty Event, the amount of any
insurance proceeds or condemnation (or similar) awards received by the Borrower
or any Subsidiary Guarantor in connection with such Casualty Event (net of all
reasonable and customary collection expenses thereof), excluding, however,
any proceeds or awards required to be paid to a creditor (other than the
Lenders) which holds a first priority Lien permitted by clause

-19-

 (b), (d), (e), (f),
(h), (j) or (k) of Section 7.2.3 on the property
which is the subject of such Casualty Event. 

          “Net
Disposition Proceeds” means, relative to any Disposition by the Borrower or
any Subsidiary pursuant to clause (e) of  Section 7.2.10, the
excess of (x) the gross cash proceeds received by the Borrower or such
Subsidiary Guarantor from such Disposition and any cash payment received in
respect of promissory notes or other non-cash consideration delivered to the
Borrower or such Subsidiary Guarantor in respect thereof, minus (y) the
sum of (1) all reasonable and customary legal, investment banking, brokerage
and accounting fees and expenses incurred in connection with such Disposition, plus
(2) all Taxes actually paid or estimated by the Borrower or such Subsidiary to
be payable in cash within the next 12 months in connection with such
Disposition plus (3) payments required to be made to a creditor (other
than the Lenders) which holds a first priority Lien permitted by clause (b),
(d), (e) (f), (h), (j) or (k) of Section 7.2.3 on the property
which is subject to such Disposition; provided,however, that, if the amount of
any estimated Taxes pursuant to clause (y)(2) exceeds the amount of
Taxes actually required to be paid in cash in respect of such Disposition in an
amount greater than $100,000, the aggregate amount of such excess shall
constitute Net Disposition Proceeds. 

          “Net
Equity/Subordinated Debt Proceeds” means, relative to (a) the sale or
issuance after the Effective Date by the Borrower of its Capital Securities or
warrants or options to acquire such Capital Securities or the exercise of any
such warrants or options or the contribution to the capital of the Borrower
after the Effective Date (in each case other than with respect to the Equity
Incentive Plans, dividends or other distributions paid in common stock of the
Borrower, conversions of convertible securities or Investments made in common
stock of the Borrower, in each case to the extent permitted hereunder) or (b)
the issuance after the Effective Date by the Borrower of Subordinated Debt, in
each case to the extent permitted hereunder, the excess of (x) the gross cash
proceeds received by such Person from such sale, exercise, issuance or contribution
minus (y) all reasonable and customary underwriting commissions and
legal, investment banking, brokerage and accounting and other professional
fees, sales commissions and disbursements actually incurred in connection with
such sale, issuance, exercise or contribution which have not been paid to
Affiliates of the Borrower in connection therewith. 

          “Net
Income” means, for any period, calculated in accordance with Section 1.5,
the aggregate of all amounts (inclusive, for purposes of clause (a) of Section
7.2.4, of all amounts in respect of any extraordinary gains and
extraordinary losses, and exclusive, for all other purposes, of all amounts in
respect of any extraordinary gains and extraordinary losses) which would be
included as net income on the consolidated financial statements of the Borrower
and its Subsidiaries for such period. 

          “Net
Worth” means, as at any date, the excess of 

	
 

	
 

	
 

	
          (a)
  the sum of capital stock (other than Redeemable Capital Securities) taken at
  par value, capital surplus (other than in respect of Redeemable Capital
  Securities) and retained earnings (or accumulated deficit) of the Borrower at
  such date; 

	
 

	
 

	
 

	
over 

-20-

	
 

	
 

	
 

	
          (b)
  treasury stock of the Borrower and, to the extent included in the preceding clause
  (a), minority interests in Subsidiaries of the Borrower at such date.

	
 

	
 

	
          “Non-Excluded
  Taxes” means any Taxes other than net income and franchise Taxes imposed
  with respect to any Secured Party by any Governmental Authority under the
  laws of which such Secured Party is organized or in which it maintains its
  applicable lending office.

	
 

	
 

	
          “Non-U.S.
  Lender” means any Lender that is not a “United States person”, as defined
  under Section 7701(a)(30) of the Code.

	
 

	
 

	
          “Notes”
  means, as the context may require, a Term I Note or a Term II Note.

          “Obligation”
means each obligation (monetary or otherwise, whether absolute or contingent,
matured or unmatured) of the Borrower or any other Obligor arising under or in
connection with (w) a Loan Document, including the principal of and premium, if
any, and interest (including interest accruing during the pendency of any
proceeding of the type described in Section 8.1.9, whether or not
allowed in such proceeding) on the Loans, (x) any doré or concentrate purchase
agreement under which the counterparty of such agreement is a Lender, the
Administrative Agent or any Affiliate of a Lender or the Administrative Agent,
(y) any agreement to provide cash management services (including treasury,
depository, overdraft, credit or debit card, electronic funds transfer and
other cash management arrangements) under which the counterparty of such
agreement is a Lender, the Administrative Agent or any Affiliate of a Lender or
the Administrative Agent, and (z) any Lender Hedging Agreement; provided,
however, with respect to any Obligation arising under the foregoing clauses
(x), (y) and (z), upon any counterparty to such agreement
ceasing to be a Lender, the Administrative Agent or any Affiliate of a Lender
or the Administrative Agent, the obligation of Borrower or any other Obligor
owing to such Person thereunder shall no longer constitute an Obligation.  

          “Obligor”
means, as the context may require, the Borrower, the Subsidiary Guarantors and
each other Person (other than a Secured Party) obligated under any Loan
Document. 

          “OFAC”
is defined in Section 6.3. 

          “Organic
Document” means, relative to any Obligor, as applicable, its certificate of
incorporation, by-laws, certificate of partnership, partnership agreement,
certificate of formation, limited liability agreement, operating agreement and
all shareholder agreements, voting trusts and similar arrangements applicable
to any of such Obligor’s Capital Securities. 

          “Other
Taxes” means any and all stamp, documentary or similar Taxes, or any other
excise or property Taxes or similar levies that arise on account of any payment
made or required to be made under any Loan Document or from the execution, delivery,
registration, recording or enforcement of any Loan Document. 

          “Participant”
is defined in clause (e) of Section 10.11. 

          “PATRIOT
Act” means the USA PATRIOT ACT (Title III of Pub. L. 107-56 (signed into
law October 26, 2001)), as amended and supplemented from time to time. 

-21-

          “PATRIOT
Act Disclosures” means all documentation and other information which the
Administrative Agent or any Lender reasonably requests in order to comply with
its ongoing obligations under applicable “know your customer” and anti-money
laundering rules and regulations, including the PATRIOT Act. 

          “PBGC”
means the Pension Benefit Guaranty Corporation and any Person succeeding to any
or all of its functions under ERISA. 

          “Pension
Plan” means a “pension plan”, as such term is defined in Section 3(2) of
ERISA, which is subject to Title IV of ERISA (other than a multiemployer plan
as defined in Section 4001(a)(3) of ERISA), and to which the Borrower or any
corporation, trade or business that is, along with the Borrower, a member of a
Controlled Group, may have liability, including any liability by reason of
having been a substantial employer within the meaning of Section 4063 of ERISA
at any time during the preceding five years, or by reason of being deemed to be
a contributing sponsor under Section 4069 of ERISA. 

          “Percentage”
means, relative to any Lender, its Term I Percentage or its Term II Percentage,
as the case may be. 

          “Permitted
Acquisition” means an acquisition, whether of Capital Securities, assets or
otherwise, by the Borrower or any Subsidiary of a Person or all or a
substantial portion of the assets of, or a business or a line of business from,
any Person (by merger or consolidation or otherwise) in which the following
conditions are satisfied: 

	
 

	
 

	
 

	
          (a)
  immediately before and after giving effect to such acquisition no Default
  shall have occurred and be continuing or would result therefrom (including
  under Section 7.2.1);

	
 

	
 

	
 

	
          (b)
  such acquisition was not preceded by an unsolicited tender offer for the
  Capital Securities of the Person subject to such acquisition by, or by a
  proxy contest initiated by, the Borrower or any of its Subsidiaries;

	
 

	
 

	
 

	
          (c)
  if the consideration for such acquisition is not comprised solely of Capital
  Securities (other than Redeemable Capital Securities) of the Borrower (or of
  proceeds of any such Capital Securities that are issued pursuant to a
  substantially concurrent transaction), (i) in the case of an acquisition of a
  Person or its Capital Securities, such Person becomes a Subsidiary of the
  Borrower as a result of such acquisition, and, in the case of an acquisition
  of assets, such acquisition results in the Borrower acquiring a controlling
  interest in such assets, and (ii) the Borrower shall have delivered to the
  Administrative Agent a Compliance Certificate for the period of four full
  Fiscal Quarters immediately preceding such acquisition (prepared in good
  faith and in a manner and using such methodology which is consistent with the
  most recent financial statements delivered pursuant to Section 7.1.1)
  giving pro forma effect to the consummation of such acquisition
  and all transactions related thereto (including all Indebtedness that would
  be assumed or incurred as a result thereof) and evidencing compliance with
  the covenants set forth in Section 7.2.4 and certifying as to the
  satisfaction of the conditions set forth in the preceding clauses of this
  definition; provided, however, that, notwithstanding 

-22-

	
 

	
 

	
 

	
anything
  herein to the contrary, when determining compliance with the covenants set
  forth in Section 7.2.4 for purposes of this definition, (x) any
  non-recurring and one-time expenses included in the results of operations of
  the business being acquired, taking into account standard industry
  exploration, development and production spending patterns, may be excluded
  from the calculations required by this clause (c) for any period prior
  to the date of the consummation of such acquisition and (y) any projected
  increase in operating, exploration or other costs of the Borrower and its
  Subsidiaries as a result of such acquisition shall be included in the
  calculations required by this clause (c), in each case under clause
  (ii), in form and substance reasonably satisfactory to the Administrative
  Agent; and

	
 

	
 

	
 

	
          (d) promptly
  after the public disclosure of any proposed Permitted Acquisition, in the
  case of any acquisition of any Person, assets, business or line of business,
  the consideration (including cash and non-cash, actual or contingent) for
  which exceeds $25,000,000, the Borrower shall have furnished the
  Administrative Agent with (x) historical financial statements for the last
  Fiscal Year (or, if less, the period since formation relative to such Person,
  assets, business or line of business (audited if available without undue cost
  or delay) and unaudited financial statements thereof for the most recent
  interim period which are available, (y) a reasonably detailed description of
  all material information relating thereto and copies of all material
  documentation relating thereto and copies of all material documentation
  pertaining to such transaction and (z) all such other material information
  and data relating to such transaction or the Person, assets, business or line
  of business to be acquired, in each case in form and substance reasonably
  satisfactory to the Administrative Agent. 

          “Permitted
Liens” means Liens permitted pursuant to Section 7.2.3. 

          “Person”
means any natural person, corporation, limited liability company, partnership,
joint venture, association, trust or unincorporated organization, Governmental
Authority or any other legal entity, whether acting in an individual, fiduciary
or other capacity. 

          “Pledge
Agreement” means the Pledge Agreement executed and delivered by an
Authorized Officer of the Borrower and any applicable Subsidiary, substantially
in the form of Exhibit G hereto, as amended, supplemented, amended and
restated or otherwise modified from time to time. 

          “Pledged
Foreign Subsidiary” means any Foreign Subsidiary that is a Material
Subsidiary with proven and probable reserves (in each case as determined in
accordance with the standards established from time to time by the SEC.) 

          “Plug
Amount” means the following: 

	
 

	
 

	
 

	
 

	
                    (a)
  in determining EBITDA, for any Fiscal Quarter ending on

	
 

	
 

	
 

	
 

	
                              (i)
  June 30, 2007, September 30, 2007 or December 31, 2007, the Plug Amount is
  $42,641,000, $44,623,000 and $22,336,000, respectively, 

-23-

	
 

	
 

	
 

	
 

	
                              (ii)
  March 31, 2008, the Plug Amount is $22,336,000 until the 45th day
  following the end of such Fiscal Quarter at which time the Plug Amount for
  such Fiscal Quarter shall be an amount (the “March EBITDA Amount”)
  that is (x) calculated by the Borrower using methodologies consistent with
  those used to calculate the deemed EBITDA amounts set forth in the foregoing clause
  (a)(i), (y) notified to the Administrative Agent no later than forty-five
  (45) days following the end of such Fiscal Quarter, and (z) reasonably
  satisfactory to the Administrative Agent, and 

	
 

	
 

	
 

	
 

	
                              (iii)
  June 30, 2008, the Plug Amount is the March EBITDA Amount until the 45th
  day following the end of such Fiscal Quarter at which time the Plug Amount
  for such Fiscal Quarter shall be an amount that is (x) calculated by the
  Borrower using methodologies consistent with those used to calculate the
  deemed EBITDA amounts set forth in the foregoing clause (a)(i), (y)
  notified to the Administrative Agent no later than the 45th day
  following the end of such Fiscal Quarter, and (z) reasonably satisfactory to
  the Administrative Agent; and 

	
 

	
 

	
 

	
 

	
                    (b)
  with respect to Interest Expense (other than Interest Expense attributable to
  the Term II Loans), for any Fiscal Quarter ending on 

	
 

	
 

	
 

	
 

	
                              
  (i) June 30, 2007, September 30, 2007 or December 31, 2007, the Plug Amount
  is $2,237,000, $1,803,000 and $1,904,000, respectively, 

	
 

	
 

	
 

	
 

	
                              (ii)
  March 31, 2008, the Plug Amount is $1,904,000 until the 45th day
  following the end of such Fiscal Quarter at which time the Plug Amount for
  such Fiscal Quarter shall be an amount (the “March IE Amount”) that is
  (x) calculated by the Borrower using methodologies consistent with those used
  to calculate the deemed Interest Expense amounts set forth in the foregoing clause
  (b)(i), (y) notified to the Administrative Agent no later than forty-five
  (45) days following the end of such Fiscal Quarter, and (z) reasonably
  satisfactory to the Administrative Agent, and 

	
 

	
 

	
 

	
 

	
                              (iii)
  June 30, 2008, the Plug Amount is the March IE Amount until the 45th
  day following the end of such Fiscal Quarter at which time the Plug Amount
  for such Fiscal Quarter shall be an amount that is (x) calculated by the
  Borrower using methodologies consistent with those used to calculate the
  deemed Interest Expense amounts set forth in the foregoing clause (b)(i),
  (y) notified to the Administrative Agent no later the 45th day
  following the end of such Fiscal Quarter, and (z) reasonably satisfactory to
  the Administrative Agent. 

          “Primary
Syndication” means the period commencing on or prior to the Effective Date
and ending on the date that a successful syndication (as defined in the Fee
Letter) has been achieved in the determination of the Administrative Agent. 

          “Prior
GAAP Financials” is defined in Section 1.5. 

          “Quarterly
Payment Date” means the last day of March, June, September and December,
or, if any such day is not a Business Day, the next succeeding Business Day. 

-24-

          “Redeemable
Capital Securities” means Capital Securities of the Borrower or any of its
Subsidiaries that, either by its terms, by the terms of any security into which
it is convertible or exchangeable or otherwise, (i) is or upon the happening of
an event or passage of time would be required to be redeemed (for consideration
other than shares of common stock of the Borrower) on or prior to the one-year
anniversary of the Stated Maturity Date of the Term I Loans (as such date may
be extended or otherwise amended from time to time), except to the extent such
mandatory redemption is required pursuant to a customary change of control
provision which expressly provides that all indebtedness that may be required
to be redeemed or prepaid on account of the relevant change of control shall
have been redeemed or prepaid prior to any such redemption of Capital Securities,
(ii) is redeemable at the option of the holder thereof (for consideration other
than shares of common stock of the Borrower) at any time prior to such date or
(iii) is convertible into or exchangeable for debt securities of the Borrower
or any of its Subsidiaries at any time prior to such anniversary. 

          “Refinanced
Debt” means all Indebtedness outstanding under the Existing Credit
Agreement and all other Indebtedness of the Borrower and its Subsidiaries
(including Kennecott and Kennecott Juneau), other than the (x) Indebtedness
identified in Item 7.2.2(b) of the Disclosure Schedules and (y) with
respect to the Borrower and all Subsidiaries other than the Greens Creek
Participants, Indebtedness permitted pursuant to Section 7.2.2. 

          “Refinancing”
means, as to any Indebtedness, the incurrence of other Indebtedness to
refinance such existing Indebtedness; provided that, in the case of such
other Indebtedness, the following conditions are satisfied: 

	
 

	
 

	
 

	
          (i)
  the weighted average life to maturity of such refinancing Indebtedness shall
  be greater than or equal to the weighted average life to maturity of the
  Indebtedness being refinanced, and the first scheduled principal payment in
  respect of such refinancing Indebtedness shall not be earlier than the first
  scheduled principal payment in respect of the Indebtedness being refinanced; 

	
 

	
 

	
 

	
          (ii)
  the principal amount of such refinancing Indebtedness shall be less than or
  equal to the principal amount then outstanding of the Indebtedness being
  refinanced; 

	
 

	
 

	
 

	
          (iii)
  the respective obligor or obligors shall be the same on the refinancing
  Indebtedness as on the Indebtedness being refinanced; 

	
 

	
 

	
 

	
          (iv)
  the security, if any, for the refinancing Indebtedness shall be the same as
  that for the Indebtedness being refinanced (except to the extent that less
  security is granted to holders of refinancing Indebtedness); 

	
 

	
 

	
 

	
          (v)
  the refinancing Indebtedness is subordinated to the Obligations to the same
  degree, if any, or to a greater degree as the Indebtedness being refinanced;
  and 

	
 

	
 

	
 

	
          (vi)
  no material terms applicable to such refinancing Indebtedness or, if
  applicable, the related guarantees of such refinancing Indebtedness
  (including covenants, events of default, remedies, and acceleration rights)
  shall be more 

-25-

	
 

	
 

	
 

	
 

	
 

	
favorable to
  the refinancing lenders than the terms that are applicable under the
  instruments and documents governing the Indebtedness being refinanced.

          “Register”
is defined in clause (a) of Section 2.6. 

          “Release”
means a “release”, as such term is defined in CERCLA. 

          “Replacement
Lender” is defined in clause (h) of Section 10.11. 

          “Required
Lenders” means, at any time, Lenders holding more than 66 2/3% of the Total
Exposure Amount. 

          “Restricted
Payment” means (i) the declaration or payment of any dividend (other than
dividends payable solely in common stock of the Borrower) on, or on account of,
any class of Capital Securities of the Borrower or any Subsidiary, or (ii) the
making of any payment or distribution on account of, or setting apart assets
for a sinking or other analogous fund for, the purchase, redemption,
defeasance, retirement or other acquisition of any class of Capital Securities
of the Borrower or any Subsidiary or any warrants, options or other right or
obligation to purchase or acquire any such Capital Securities, whether now or
hereafter outstanding, or the making of any other distribution in respect thereof,
either directly or indirectly, whether in cash, obligations of the Borrower or
any Subsidiary, property or otherwise. 

          “Retained
Proceeds” means, with respect to any date of determination, an amount
(which may be a negative amount) equal (without duplication) to: 

	
 

	
 

	
 

	
          (a) the
  aggregate cumulative sum for each Fiscal Year commencing with the 2008 Fiscal
  Year of 65% of Excess Cash Flow for such Fiscal Year; provided that
  all applicable repayments under clause (e) of Section 3.1.1 for
  such Fiscal Year have been made; 

	
 

	
 

	
 

	
plus 

	
 

	
 

	
 

	
          (b) with
  respect to any Investment permitted under clause (d) (other than with
  respect to the Greens Creek Mine, the Lucky Friday Mine, the Isidora Mine or
  the La Comorra Mine), (e)(i), (f)(i), (h), (i), (j)
  and (l) of Section 7.2.5, 50% (or, on or after the date that
  the relevant percentage set forth in clause (c) of Section 3.1.1
  is 0% in accordance with the terms of such clause, 100%) of the aggregate
  amount of Net Equity/Subordinated Debt Proceeds received in connection with
  the issuance or sale of Capital Securities for the purpose of financing such
  Investment; provided that all applicable repayments under clause
  (c) of Section 3.1.1 for such Fiscal Year have been made; 

	
 

	
 

	
 

	
minus 

	
 

	
 

	
 

	
          (c) the
  aggregate of any amounts set forth in clauses (a) and (b) above
  previously applied to the making of any Investment permitted under clause
  (d) (other than with respect to the Greens Creek Mine, the Lucky Friday
  Mine, the Isidora Mine or the La Comorra Mine), (e)(i), (f)(i),
  (h), (i), (j) and (l) of Section 7.2.5. 

-26-

          “S&P”
means Standard & Poor’s Rating Services, a division of The McGraw-Hill
Company, Inc. 

          “San
Juan Silver Mining Joint Venture” means the joint venture entered into
pursuant to that certain Exploration, Development and Mine Operating Agreement
dated February 21, 2008, among Rio Grande Silver, Inc., a Subsidiary, Emerald
Mining & Leasing, LLC and Golden 8 Mining, LLC, regarding the exploration,
evaluation and possible development and mining of mineral resources on certain
properties located in Mineral County, Colorado. 

          “Sarbanes-Oxley”
means the U.S. Sarbanes-Oxley Act of 2002. 

          “Scotiabank”
is defined in the preamble.

          “SEC”
means the Securities and Exchange Commission. 

          “Secured
Parties” means, collectively, the Lenders, the Administrative Agent, each
counterparty to a Lender Hedging Agreement, each of the foregoing and Affiliate
thereof that is a counterparty to each other agreement which evidences an
Obligation or under which an Obligation arises and each of their respective
successors, transferees and assigns. 

          “Security
Agreement” means the Security Agreement executed and delivered by an
Authorized Officer of each of the Greens Creek Participants and the
Administrative Agent, substantially in the form of Exhibit H hereto, as
amended, supplemented, amended and restated or otherwise modified from time to
time.

          “Series
B Preferred Stock” means the Borrower’s Series B Cumulative Convertible
Preferred Stock, par value $0.25 per share. 

          “Small
Lot Repurchase Program” means the Borrower’s program to redeem, purchase or
acquire the common stock, par value $0.25 per share, of the Borrower held by
Persons which hold 10 shares or less of such common stock of the Borrower. 

          “Solvent”
means, with respect to any Person on a particular date, that on such date (a)
the fair value of the property of such Person on a consolidated basis is
greater than the total amount of liabilities, including contingent liabilities,
of such Person, (b) the present fair salable value of the assets of such Person
is not less than the amount that will be required to pay the probable liability
of such Person on its debts as they become absolute and matured, (c) such
Person does not intend to, and does not believe that it will, incur debts or
liabilities beyond the ability of such Person to pay as such debts and
liabilities mature, and (d) such Person is not engaged in business or a
transaction, and such Person is not about to engage in business or transaction,
for which the property of such Person on a consolidated basis would constitute
an unreasonably small capital. The amount of Contingent Liabilities at any time
shall be computed as the amount that, in light of all the facts and
circumstances existing at such time, can reasonably be expected to become an
actual or matured liability. 

          “Stated
Maturity Date” means: 

                    (a)
relative to all Term I Loans, March 31, 2011; and 

-27-

                    (b)
relative to all Term II Loans, October 16, 2008. 

          “Subordinated
Debt” means unsecured Indebtedness of the Borrower which (a) is
subordinated in right of payment to the Obligations on terms customary in the
reasonable judgment of the Required Lenders for comparable issuances of
high-yield debt securities, (b) does not require any scheduled repayment within
one year following the Stated Maturity Date of the Term I Loans, (c) has only
cross acceleration rights (and not cross default rights), (d) is subject to a
customary standstill period with respect to enforcement of remedies and other
lender rights of no less than 180 days, (e) is not subject to maintenance
financial covenant requirements, (f) is subject to terms and provisions no more
restrictive than those set forth in this Agreement and (g) has other covenants,
events of default, remedies, acceleration rights, redemption provisions and
other terms that are, in the reasonable judgment of the Required Lenders,
customary for comparable issuances of high-yield debt securities and that are
set forth in the Subordinated Debt Documents. 

          “Subordinated
Debt Documents” means, collectively, the loan agreements, indentures, note
purchase agreements, promissory notes, guarantees, and other instruments and
agreements evidencing the terms of Subordinated Debt, as amended, supplemented,
amended and restated or otherwise modified in accordance with Section 7.2.11.

          “Subsidiary”
means, with respect to any Person, any other Person of which more than 50% of
the outstanding Voting Securities of such other Person (irrespective of whether
at the time Capital Securities of any other class or classes of such other
Person shall or might have voting power upon the occurrence of any contingency)
is at the time directly or indirectly owned or controlled by such Person, by
such Person and one or more other Subsidiaries of such Person, or by one or
more other Subsidiaries of such Person. Unless the context otherwise
specifically requires, the term “Subsidiary” shall be a reference to a
Subsidiary of the Borrower. 

          “Subsidiary
Guarantors” means the Material U.S. Subsidiaries of Borrower that have
executed and delivered to the Administrative Agent the Subsidiary Guaranty including
by means of a delivery of a supplement thereto. 

          “Subsidiary
Guaranty” means the subsidiary guaranty executed and delivered by an
Authorized Officer of each Material U.S. Subsidiary pursuant to the terms of
this Agreement, substantially in the form of Exhibit F hereto, as
amended, supplemented, amended and restated or otherwise modified from time to
time. 

          “Synthetic
Lease” means, as applied to any Person, any lease (including leases that
may be terminated by the lessee at any time) of any property (whether real,
personal or mixed) (a) that is not a capital lease in accordance with GAAP and
(b) in respect of which the lessee retains or obtains ownership of the property
so leased for federal income tax purposes, other than any such lease under
which that Person is the lessor. 

          “Taxes”
means all income, stamp or other taxes, duties, levies, imposts, charges,
assessments, fees, deductions or withholdings, now or hereafter imposed,
levied, collected, withheld or assessed by any Governmental Authority, and all
interest, penalties or similar liabilities with respect thereto. 

-28-

          “Term
I Loan” is defined in clause (a) of Section 2.1. 

          “Term
I Loan Commitment” means, relative to any Lender listed as having a
Commitment (or percentage of a Commitment) on Schedule II or on any
relevant Lender Assignment Agreement, the obligation of such Lender, if any, to
make a Term I Loan to the Borrower on the Effective Date in accordance with clause
(a) of Section 2.1 in a principal amount not to exceed such Lender’s
Term I Percentage of the aggregate amount of Term I Loans being advanced on
such date under clause (a) of Section 2.1. 

          “Term
I Loan Commitment Amount” means, on any date, $140,000,000. 

          “Term
I Note” means a promissory note of the Borrower payable to any Lender, in
the form of Exhibit A-1 hereto (as such promissory note may be amended,
endorsed or otherwise modified from time to time), evidencing the aggregate
Indebtedness of the Borrower to such Lender resulting from outstanding Term I
Loans, and also means all other promissory notes accepted from time to time in
substitution therefor or renewal thereof. 

          “Term
I Percentage” means, relative to any Lender, the applicable percentage relating
to Term I Loans set forth opposite its name on Schedule II under the
Term I Loan Commitment column or set forth in a Lender Assignment Agreement
under the Term I Loan Commitment column, as such percentage may be adjusted
from time to time pursuant to Lender Assignment Agreements executed by such
Lender and its assignee and delivered pursuant to Section 10.11. A
Lender shall not have any Term I Loan Commitment if its percentage under the
Term I Loan Commitment column is zero. 

          “Term
II Loan” is defined in clause (b) of Section 2.1.  

          “Term
II Loan Commitment” means, relative to any Lender listed as having a
Commitment (or percentage of a Commitment) on Schedule II or on any
relevant Lender Assignment Agreement, the obligation of such Lender, if any, to
make a Term II Loan to the Borrower from time to time in accordance with clause(b)
of Section 2.1 in a principal amount not to exceed such Lender’s Term II
Percentage of the aggregate amount of Term II Loans being advanced on such date
under clause (b) of Section 2.1. 

          “Term
II Loan Commitment Amount” means on any date, $240,000,000. 

          “Term
II Loan Commitment Termination Date” means the earliest of 

                    (a)
September 30, 2008 (if all Term II Loans have not been made in full on or prior
to such date; and 

                    (b)
the date on which any Term II Loan Commitment Termination Event occurs. 

          Upon
the occurrence of any event described above, the Term II Loan Commitment shall
terminate automatically and without any further action. 

          “Term
II Loan Commitment Termination Event” means 

-29-

                    (a)
the occurrence of any Event of Default relative to the Borrower described in clauses
(a) through (d) of Section 8.1.9; or 

                    
(b) the occurrence and continuance of any other Event of Default and either (x)
the declaration of all or any portion of the Loans to be due and payable
pursuant to Section 8.3 or (y) the giving of notice by the
Administrative Agent, acting at the direction of the Required Lenders, to the
Borrower that the Commitments have been terminated in accordance with Section
8.3. 

          “Term
II Note” means a promissory note of the Borrower payable to any Lender, in
the form of Exhibit A-2 hereto (as such promissory note may be amended,
endorsed or otherwise modified from time to time), evidencing the aggregate
Indebtedness of the Borrower to such Lender resulting from outstanding Term II
Loans, and also means all other promissory notes accepted from time to time in
substitution therefor or renewal thereof. 

          “Term
II Percentage” means, relative to any Lender, the applicable percentage
relating to Term II Loans set forth opposite its name on Schedule II
under the Term II Loan Commitment column or set forth in a Lender Assignment
Agreement under the Term II Loan Commitment column, as such percentage may be
adjusted from time to time pursuant to Lender Assignment Agreements executed by
such Lender and its assignee and delivered pursuant to Section 10.11. A
Lender shall not have any Term II Loan Commitment if its percentage under the
Term II Loan Commitment column is zero. 

          “Termination
Date” means the date on which all Obligations (other than contingent
indemnification obligations for which no claim has been asserted) have been
paid in full in cash, all Lender Hedging Agreements have been terminated or
have been otherwise provided for on terms reasonably satisfactory to the
parties thereto, and all Commitments shall have terminated. 

          “Total
Exposure Amount” means, on any date of determination (and without
duplication), the outstanding principal amount of all Loans. 

          “Total
Net Debt” means, at any time, (a) the outstanding principal amount of all
Indebtedness of the Borrower and its Subsidiaries of the type referred to in clause
(a), clause (b), clause (c), clause (f) (other than
Earn-out Obligations (A) that have not been reduced to a fixed amount or (B) to
the extent such obligations may, in accordance with their terms, be satisfied
at the sole option of the obligor thereof at any time regardless of the
happening of any event by the delivery of Capital Securities (other than
Redeemable Capital Securities) of the Borrower), clause (g) and clause
(h), in each case of the definition of “Indebtedness”(exclusive of (i)
Indebtedness secured on a first-priority basis by any restricted cash deposit
in an amount not exceeding the amount of such restricted cash deposit, (ii)
solely with respect to determining compliance with clause (b) of Section
7.2.4, Indebtedness consisting of Term II Loans and (iii) to the extent
constituting Indebtedness, Designated Preferred Stock and any Contingent
Liability (including for the benefit of third parties) in respect of any of the
foregoing, less (b) Unrestricted Cash. 

          “Transaction”
means collectively: 

                    (a)
the consummation of all of the transactions comprising the Acquisition, and 

-30-

	
 

	
 

	
 

	
          (b)
  the making of the Loans and all of the other transactions contemplated by the
  Loan Documents as occurring on the Effective Date, 

and all of the other
transactions contemplated hereby to occur on the Effective Date or incidental
thereto, including the payment of Transaction Costs. 

          “Transaction
Cost” means any fee, cost or expenses payable by the Borrower or any
Subsidiary in connection with the Transaction. 

          “Transaction
Document” means, collectively, the Acquisition Agreement, the Greens Creek
Joint Venture Agreement, the Land Exchange Agreement, and all material
documents executed and delivered in connection with any of the foregoing on and
prior to the Effective Date, in each case as amended, supplemented, amended and
restated or otherwise modified from time to time in accordance with Section
7.2.11. 

          “type”
means, relative to the Loans, the portion thereof, if any, being maintained as
a Base Rate Loan or a LIBO Rate Loan. 

          “UCC”
means the Uniform Commercial Code as in effect from time to time in the State
of New York; provided, however, that, if, relative to any Filing
Statement or by reason of any Applicable Law, the perfection or the effect of
perfection or non-perfection of the security interests granted to the
Administrative Agent pursuant to the applicable Loan Document is governed by
the Uniform Commercial Code as in effect in a jurisdiction of the United States
other than New York, then “UCC” means the Uniform Commercial Code as in effect
from time to time in such other jurisdiction for purposes of the provisions of
each Loan Document and any Filing Statement relating to such perfection or
effect of perfection or non-perfection. 

          “United
States” or “U.S.” means the United States of America, its fifty
states and the District of Columbia. 

          “U.S.
Subsidiary” means any Subsidiary that is incorporated or organized under
the laws of the United States, a state thereof or the District of Columbia. 

          “Unrestricted
Cash” means, with respect to any Person, unrestricted cash or Cash Equivalent
Investments of such Person that are free of any Lien and are held (a) in a
financial institution (x) located in and organized under the laws of either the
United States, Canada or Mexico, (y) which has a credit rating of A2 or higher
from Moody’s, A or higher from S&P or A or higher from Fitch and (z) which
has a combined capital and surplus greater than $250,000,000, or (b) at Idaho
Independent Bank (provided that the aggregate amount of cash or Cash
Equivalent Investments maintained at Idaho Independent Bank at any time shall
not exceed $20,000,000). 

          “Unrestricted
Disposition” means those Dispositions identified on Item 1.1(b) of
the Disclosure Schedule. 

          “Voting
Securities” means, with respect to any Person, Capital Securities of any
class or kind ordinarily having the power to vote for the election of
directors, managers or other voting members of the governing body of such
Person. 

-31-

          “Welfare
Plan” means a “welfare plan”, as such term is defined in Section 3(1) of
ERISA. 

          “wholly
owned Subsidiary” means any Subsidiary all of the outstanding Capital
Securities of which (other than any director’s qualifying shares or investments
by foreign nationals mandated by Applicable Laws) is owned directly or
indirectly by the Borrower. 

          SECTION 1.2. Use of Defined
Terms. Unless otherwise defined
or the context otherwise requires, terms for which meanings are provided in
this Agreement shall have such meanings when used in each other Loan Document
and the Disclosure Schedule. 

          SECTION 1.3. Certain Interpretive
Matters. Unless otherwise
specified herein or the context otherwise requires, with reference to their usage
in this Agreement and each other Loan Document: 

	
 

	
 

	
 

	
          (a)
  The meanings of defined terms are equally applicable to the singular and
  plural forms thereof. 

	
 

	
 

	
 

	
          (b)
  The following non-capitalized terms (whether or not italicized) have the
  following meanings: 

	
 

	
 

	
 

	
 

	
 

	
          “document”
includes any and all instruments, documents, agreements, certificates,
notices, reports, financial statements and other writings, however evidenced,
whether in physical or electronic form. 

	
 

	
 

	
 

	
 

	
 

	
          when
computing periods of time from a specified date to a later specified date,
(x) “from” means “from and including”, (y) “to” and “until” each mean “to but
excluding” and (z) “through” means “to and including”.  

	
 

	
 

	
 

	
 

	
 

	
          “herein”,
“hereto”, “hereof” and “hereunder” and words of similar import when used in
any Loan Document shall refer to such Loan Document as a whole and not to any
particular provision thereof.  

	
 

	
 

	
 

	
 

	
 

	
          “including”
is by way of example and not limitation. 

	
 

	
 

	
 

	
 

	
 

	
          “or”
is not exclusive.  

	
 

	
 

	
 

	
          (c)
  References to Organic Documents, agreements (including the Loan Documents)
  and other contractual instruments shall be deemed to include all subsequent
  amendments, restatements, extensions, supplements and other modifications
  thereto, but only to the extent that such amendments, restatements,
  extensions, supplements and other modifications are permitted by any Loan
  Document. 

	
 

	
 

	
 

	
          (d)
  References to any Applicable Law shall include all statutory and regulatory
  provisions consolidating, amending, replacing, supplementing or interpreting
  such Applicable Law. 

-32-

          SECTION 1.4. Cross-References.
Unless otherwise specified,
(x) references in the Agreement and any other Loan Document to any recital,
definition, Article, Section or Exhibit are references to such recital,
definition, Article or Section of or Exhibit to the Agreement or such other
Loan Document, as the case may be, and (y) references in any recital,
definition or Section of the Agreement or any other Loan Document to any item
or clause are references to such item or clause of such recital, definition or
Section of the Agreement or such other Loan Document. 

          SECTION 1.5. Accounting and Financial Determinations.

	
 

	
 

	
 

	
          (a)
Unless otherwise specified, all accounting terms used in each Loan Document
shall be interpreted, and all accounting determinations and computations
thereunder (including under Section 7.2.4 and the definitions used in
such calculations) shall be made, in accordance with those U.S. generally
accepted accounting principles (“GAAP”) applied in the preparation of
the financial statements referred to in clause (a) of Section 5.1.6. Unless otherwise expressly provided, all financial covenants and defined
financial terms shall be computed on a consolidated basis for the Borrower
and its Subsidiaries, in each case without duplication.  

	
 

	
 

	
 

	
          (b)
  If the Borrower notifies the Administrative Agent that the Borrower wishes to
  amend any covenant in Article VII or any related definition to
  eliminate the effect of any change in GAAP occurring after the date of this
  Agreement on the operation of such covenant (or if the Administrative Agent
  notifies the Borrower that the Required Lenders wish to amend Article VII
  or any related definition for such purpose), then the Borrower’s compliance
  with such covenant shall be determined on the basis of GAAP in effect
  immediately before the relevant change in GAAP became effective, until either
  such notice is withdrawn or such covenant is amended in a manner satisfactory
  to the Borrower and the Required Lenders. In the event of any such
  notification from the Borrower or the Administrative Agent and until such
  notice is withdrawn or such covenant is so amended, the Borrower will furnish
  to each Lender and the Administrative Agent, in addition to the financial
  statements required to be furnished pursuant to Section 7.1.1 (the “Current
  GAAP Financials”), (i) the financial statements described in such Section
  based upon GAAP as in effect at the time such covenant was agreed to (the “Prior
  GAAP Financials”) and (ii) a reconciliation between the Prior GAAP
  Financials and the Current GAAP Financials. 

ARTICLE II 

COMMITMENTS, BORROWING AND ISSUANCE
PROCEDURES, NOTES AND LETTERS OF CREDIT

          SECTION 2.1. Loan Commitment. 

	
 

	
 

	
 

	
          (a)
  On the Effective Date, and in a single borrowing, each Lender that has a Term
  I Loan Commitment agrees that it will make a loan (relative to such Lender,
  its “Term I Loan”) to the Borrower equal to such Lender’s Term I
  Percentage of the aggregate amount of the Term I Loan Commitment Amount
  requested by the Borrower. 

-33-

	
 

	
 

	
 

	
          (b)
  From time to time on any Business Day occurring on or after the Effective
  Date and until the Term II Loan Commitment Termination Date each Lender that
  has a Term II Loan Commitment agrees that it will make one or more loans
  (relative to such Lender, its “Term II Loan”) to the Borrower equal to
  such Lender’s Term II Loan Percentage of the aggregate amount of the
  Borrowing of Term II Loans requested by the Borrower to be made on such
  Business Day; provided that (x) not less than $200,000,000 in Term II
  Loans may be requested on the Effective Date, and (y) not more than three
  Borrowings may be requested or made following the Effective Date.

          No
amounts paid or prepaid relative to the Loans may be reborrowed. 

          SECTION 2.2. Borrowing Procedure.
By delivering a Borrowing
Request to the Administrative Agent on or before 12:00 p.m. on a Business Day,
the Borrower may from time to time irrevocably request, on that same Business
Day in the case of Base Rate Loans, or three Business Days’ notice in the case
of LIBO Rate Loans, and in either case not more than five Business Days’ notice,
that a Borrowing be made, (x) in the case of LIBO Rate Loans, in a minimum
amount of $1,000,000 and an integral multiple of $500,000, (y) in the case of
Base Rate Loans, in a minimum amount of $1,000,000 and an integral multiple of
$500,000 or (z) in either case, in the unused amount of the applicable
Commitment; provided, however, that all of the Loans made on the
Effective Date shall be made as Base Rate Loans. On the terms and subject to
the conditions of this Agreement, each Borrowing shall be comprised of the type
of Loans, and shall be made on the Business Day, specified in such Borrowing
Request. On or before 1:00 p.m. on such Business Day, each Lender that has a
Commitment to make the Loans being requested shall deposit with the
Administrative Agent same day funds in an amount equal to such Lender’s
Percentage of the requested Borrowing. Such deposit will be made to an account
which the Administrative Agent shall specify from time to time by notice to the
Lenders. To the extent funds are received from the Lenders, the Administrative
Agent shall make such funds available to the Borrower by wire transfer to the
accounts the Borrower shall have specified in its Borrowing Request. No
Lender’s obligation to make any Loans shall be affected by any other Lender’s
failure to make any Loans. 

          SECTION 2.3. Use of Proceeds. The Borrower will apply the
proceeds of the Credit Extension as follows: 

	
 

	
 

	
 

	
          (a)
  to make payments on the Effective Date pursuant to the Acquisition Agreement;
  

	
 

	
 

	
 

	
          (b)
  to repay on the Effective Date all Refinanced Debt; 

	
 

	
 

	
 

	
          (c)
  for general corporate purposes; and 

	
 

	
 

	
 

	
          (d)
  to pay fees and expenses related to the foregoing. 

          SECTION 2.4. Continuation and
Conversion Elections. By
delivering a Continuation/Conversion Notice to the Administrative Agent on or
before 10:00 a.m. on a Business Day, the Borrower may from time to time
irrevocably elect, on not less than one Business Day’s notice in the case of
Base Rate Loans, or three Business Days’ notice in the case of LIBO Rate Loans,
and in either case not more than five Business Days’ notice, that all, or any
portion in an aggregate 

-34-

minimum amount
of $1,000,000 and an integral multiple of $500,000 be, in the case of Base Rate
Loans, converted into LIBO Rate Loans or be, in the case of LIBO Rate Loans,
converted into Base Rate Loans or continued as LIBO Rate Loans (in the absence
of delivery of a Continuation/Conversion Notice relative to any LIBO Rate Loan
at least three Business Days (but not more than five Business Days) before the
last day of the then current Interest Period with respect thereto, such LIBO
Rate Loan shall, on such last day, automatically convert to a Base Rate Loan); provided,
however that, (x) each such conversion or continuation shall be pro
rated among the applicable outstanding Loans of all Lenders that have made such
Loans, and (y) no portion of the outstanding principal amount of any Loans may
be continued as, or be converted into, LIBO Rate Loans when any Default has
occurred and is continuing. 

          SECTION 2.5. Funding. Each Lender
may, if it so elects,
fulfill its obligation to make, continue or convert LIBO Rate Loans hereunder
by causing one of its foreign branches or Affiliates (or an international
banking facility created by such Lender) to make or maintain such LIBO Rate
Loan; provided, however
that such LIBO Rate Loan shall nonetheless be deemed to have been made and to
be held by such Lender, and the obligation of the Borrower to repay such LIBO
Rate Loan shall nevertheless be to such Lender for the account of such foreign
branch, Affiliate or international banking facility. In addition, the Borrower
hereby consents and agrees that, for purposes of any determination to be made
for purposes of Sections 4.1, 4.2, 4.3 and 4.4,
it shall be conclusively assumed that each Lender elected to fund all LIBO Rate
Loans by purchasing Dollar deposits in its LIBOR Office’s interbank eurodollar
market. 

          SECTION 2.6. Register; Notes. The Register shall be
maintained on the following terms. 

	
 

	
 

	
 

	
          (a)
The Borrower hereby designates the Administrative Agent to serve as the
Borrower’s agent, solely for the purpose of this clause, to maintain a
register (the “Register”) on which the Administrative Agent will
record each Lender’s Commitment, the Loans made by each Lender and each
repayment in respect of the principal amount of the Loans, annexed to which
the Administrative Agent shall retain a copy of each Lender Assignment
Agreement delivered to the Administrative Agent pursuant to Section 10.11.
Failure to make any recordation, or any error in such recordation, shall not
affect any Obligor’s Obligations. The entries in the Register shall be
conclusive, in the absence of manifest error, and the Borrower, the
Administrative Agent and the Lenders shall treat each Person in whose name a
Loan is registered (or, if applicable, to which a Note has been issued) as
the owner thereof for the purposes of all Loan Documents, notwithstanding
notice or any provision herein to the contrary. Any assignment or transfer of
a Commitment or the Loans made pursuant hereto shall be registered in the
Register only upon delivery to the Administrative Agent of a Lender
Assignment Agreement that has been executed by the requisite parties pursuant
to Section 10.11. No assignment or transfer of a Lender’s Commitment or Loans
shall be effective unless such assignment or transfer shall have been
recorded in the Register by the Administrative Agent as provided in this
Section.  

	
 

	
 

	
 

	
          (b)
  The Borrower agrees that, upon the request to the Administrative Agent by any
  Lender, the Borrower will execute and deliver to such Lender a Note
  evidencing the Loans made by, and payable to the order of, such Lender in a
  maximum principal 

-35-

	
 

	
 

	
 

	
amount equal
  to such Lender’s Percentage of the original applicable Commitment Amount. The
  Borrower hereby irrevocably authorizes each Lender to make (or cause to be
  made) appropriate notations on the grid attached to such Lender’s Note (or on
  any continuation of such grid), which notations, if made, shall evidence,
  inter alia, the date of, the
  outstanding principal amount of, and the interest rate and Interest Period
  applicable to the Loans evidenced thereby. Such notations shall, to the extent
  not inconsistent with notations made by the Administrative Agent in the
  Register, be conclusive and binding on each Obligor absent manifest error; provided, that, the failure of any Lender to make any such notations shall not
  limit or otherwise affect any Obligations of any Obligor.

ARTICLE III 

REPAYMENTS, PREPAYMENTS, INTEREST AND FEES

          SECTION 3.1. Repayments and
Prepayments; Application. The
Borrower agrees that the Loans shall be repaid and prepaid in accordance with Sections
3.1.1 and 3.1.2. 

          SECTION 3.1.1. Repayments and Prepayments. The Borrower
shall repay in full the unpaid principal amount of the Loans on the Stated
Maturity Date. Prior thereto, payments and prepayments of the Loans shall or
may be made as set forth below. 

	
 

	
 

	
 

	
          (a)
From time to time on any Business Day, the Borrower may make a voluntary
prepayment, in whole or in part, of the outstanding principal amount of any
Loans; provided that all such voluntary prepayments (x) shall require at
least one but no more than five Business Days’ prior notice to the
Administrative Agent; and (y) shall be, in the case of LIBO Rate Loans, in an
aggregate minimum amount of $1,000,000 and an integral multiple of $1,000,000
and, in the case of Base Rate Loans, in an aggregate minimum amount of
$500,000 and an integral multiple of $100,000.  

	
 

	
 

	
 

	
          (b)
  On each Quarterly Payment Date occurring during (or otherwise related to) the
  periods set forth below, the Borrower shall make repayments of the
  outstanding principal amount of the Term I Loans in the amount set forth
  below opposite such period as follows: 

	
 

	
 

	
 

	
Amount of
  Required

	
Period

	
Principal
  Repayment

	
 

	
 

	
 

	
September 1,
  2008 through (and

	
$18,333,333

	
including)
  March 31, 2009

	
 

	
 

	
 

	
April 1,
  2009 through (and

	
$10,000,000

	
including)
  March 31, 2010

	
 

	
 

	
 

	
April 1,
  2010 through (and

	
$11,250,000
  or, with respect

	
including)
  the Stated Maturity

	
to the
  Stated Maturity Date,

	
Date

	
the then
  remaining

	
 

	
outstanding
  principal amount

-36-

	
 

	
 

	
 

	
          (c)
  Concurrently with the receipt by the Borrower of any Net Equity/Subordinated Debt Proceeds, the Borrower
  shall (i) so long as any Term II Loans remain outstanding, make a mandatory
  prepayment of the Term II Loans in an amount equal to 100% of such Net
  Equity/Subordinated Debt Proceeds, and (ii) thereafter, make a
  mandatory prepayment of the Term I Loans in an amount equal to 50% of such
  Net Equity/Subordinated Debt Proceeds (provided that so long as each
  of (x) the Term II Loan has been indefeasibly paid in full and (y) the Leverage
  Ratio is less than or equal to 2.0 to 1.0, as determined in a Compliance
  Certificate delivered pursuant to Section 7.1.1(c), such percentage
  shall reduce to 0%). 

	
 

	
 

	
 

	
          (d)
  Within five Business Days after receipt by the Borrower or any Subsidiary of
  any Net Disposition Proceeds or Net Casualty Proceeds, the Borrower shall, to
  the extent the aggregate amount of such proceeds received by the Borrower and
  Subsidiaries in any period of twelve consecutive calendar months since the
  Effective Date exceeds $2,000,000 (excluding, for purposes of such
  calculation, Net Disposition Proceeds or Net Casualty Proceeds arising from
  an Unrestricted Disposition (it being agreed that the threshold for
  Unrestricted Dispositions will be $0)), make a mandatory prepayment of the
  Loans in an amount equal to 100% of such Net Disposition Proceeds or Net
  Casualty Proceeds (or, with respect to any Disposition or Casualty Event with
  respect an Unrestricted Disposition, 35% of such Net Disposition Proceeds or
  Net Casualty Proceeds); provided, however, that, upon written
  notice by the Borrower to the Administrative Agent not more than five
  Business Days following receipt of any such Net Disposition Proceeds or Net
  Casualty Proceeds (so long as no Default has occurred and is continuing),
  such proceeds may be retained by the Borrower and Subsidiaries (and be
  excluded from the prepayment requirements of this clause) if (w) the Borrower
  informs the Administrative Agent in such notice of its good faith intention
  to apply (or cause one or more of the Subsidiary Guarantors to apply) such
  Net Disposition Proceeds or Net Casualty Proceeds to the acquisition of other
  assets or properties consistent with the businesses permitted to be conducted
  pursuant to Section 7.2.1 (including by way of merger or Investment),
  (x) within 180 days following the receipt of such Net Disposition Proceeds or
  Net Casualty Proceeds, such proceeds are applied or committed to such
  acquisition, (y) if the property subject to the Disposition or Casualty Event
  that generated such Net Disposition Proceeds or Net Casualty Proceeds, as
  applicable, was collateral under the Security Agreement, then, all property
  acquired with such Net Disposition Proceeds or Net Casualty Proceeds, as
  applicable, shall be subject to the Lien of the applicable Loan Documents and
  (z) if the property subject to the Disposition or Casualty Event that
  generated such Net Disposition Proceeds or Net Casualty Proceeds, as
  applicable, was owned by an Obligor or a U.S. Subsidiary, then, all property acquired
  with such Net Disposition Proceeds or Net Casualty Proceeds, as applicable,
  shall be acquired by an Obligor or such U.S. Subsidiary, as applicable. The
  amount of such Net Disposition Proceeds or Net Casualty Proceeds unused or
  uncommitted after such 180 day period shall be applied to prepay the Loans. 

	
 

	
 

	
 

	
          (e)
  Within 100 days after the close of each Fiscal Year (beginning with the close
  of the 2008 Fiscal Year), the Borrower shall make a mandatory prepayment of
  the Loans in an amount equal to 35% of the Excess Cash Flow (if any) for such
  Fiscal Year. 

-37-

	
 

	
 

	
 

	
          (f)
Within 5 Business Days after the release of any cash or cash equivalents
(including Cash Equivalent Investments) of the Borrower or any Subsidiary
from the Liens described in clauses (c) and (g)(ii) of Section 7.2.3, the
Borrower shall make a mandatory prepayment of the Term I Loans in an amount
equal to 50% of such cash or cash equivalents released.  

	
 

	
 

	
 

	
          (g)
  Immediately upon any acceleration of the Stated Maturity Date of the Loans
  pursuant to Section 8.2 or Section 8.3, the Borrower shall
  repay all the Loans, unless, pursuant to Section 8.3, only a portion
  of all the Loans is so accelerated (in which case the portion so accelerated
  shall be so repaid). 

          Each
prepayment of any Loans made pursuant to this Section shall be without
premium or penalty, except as may be required by Section 4.4. 

          SECTION 3.1.2. Application. Amounts prepaid pursuant to Section
3.1.1 shall be applied as follows. 

	
 

	
 

	
 

	
          (a)
  each prepayment or repayment of the principal of the Loans shall be applied,
  to the extent of such prepayment or repayment, first, to the principal
  amount thereof being maintained as Base Rate Loans, and second, to the
  principal amount thereof being maintained as LIBO Rate Loans; 

	
 

	
 

	
 

	
          (b)
  each prepayment of the Loans made pursuant to clauses (a) and (c)
  of Section 3.1.1 shall be applied to a prepayment of the outstanding
  principal amount of, first to the Term II Loans, and second to the
  Term I Loans (in chronologically inverse order of amortization);

	
 

	
 

	
 

	
          (c)
  each prepayment of the Term I Loans made pursuant to clause (b) of Section
  3.1.1 shall be applied to a prepayment of the Term I Loans; 

	
 

	
 

	
 

	
          (d)
  each prepayment of the Term I Loans made pursuant to clause (f) of Section
  3.1.1 shall be applied to a mandatory prepayment of the outstanding
  principal amount of the Term I Loans (in chronologically inverse order of
  amortization); 

	
 

	
 

	
 

	
          (e)
  each prepayment of the Loans made pursuant to clauses (d) and (e)
  of Section 3.1.1 shall be applied to a mandatory prepayment of the
  outstanding principal amount of, first all the Term I Loans (in
  chronologically inverse order of amortization), and second to the Term II Loans;
  and 

	
 

	
 

	
 

	
          (f)
  each prepayment of the Loans made pursuant to clauses (g) of Section
  3.1.1 shall be applied to a pro rata mandatory prepayment of the
  outstanding principal amount of the Loans. 

          SECTION 3.2. Interest Provisions.
Interest on the
outstanding principal amount of the Loans shall accrue and be payable in
accordance with the terms set forth below.

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          SECTION 3.2.1. Rates. Pursuant to an appropriately
delivered Borrowing Request or Continuation/Conversion Notice, the Borrower may
elect that the Loans comprising a Borrowing accrue interest at a rate per
annum: 

	
 

	
 

	
 

	
          (a)
  on that portion maintained from time to time as a Base Rate Loan, equal to
  the sum of the Alternate Base Rate from time to time in effect plus the
  Applicable Margin; and 

	
 

	
 

	
 

	
          (b) on that
  portion maintained as a LIBO Rate Loan, during each Interest Period
  applicable thereto, equal to the sum of the LIBO Rate (Reserve Adjusted) for
  such Interest Period plus the Applicable Margin. 

          All
LIBO Rate Loans shall bear interest from and including the first day of the
applicable Interest Period to (but not including) the last day of such Interest
Period at the interest rate determined as applicable to such LIBO Rate Loan. 

          SECTION 3.2.2. Default Rates.
Upon the occurrence and
during the continuation of any (x) Event of Default described in Section 8.1.1
or 8.1.9 or (y) if requested by the Required Lenders, any other Event of
Default, the outstanding principal amount of the Loans and, to the extent
permitted by Applicable Law, any interest payments thereon not paid when due
and any fees and other amounts then due and payable hereunder, shall thereafter
bear interest (including post-petition interest in any proceeding described in Section
8.1.9) payable upon demand at a rate that is (x) in the case of Loans, 2.0%
per annum in excess of the interest rate otherwise payable under this Agreement
with respect to such Loans and (y) in the case of other Obligations, 2.0% per
annum in excess of the interest rate otherwise payable under this Agreement
with respect to Base Rate Loans; provided that, in the case of LIBO Rate
Loans, upon the expiration of the Interest Period in effect at the time any
such increase in interest rate is effective, such LIBO Rate Loans shall
thereupon become Base Rate Loans and shall thereafter bear interest payable
upon demand at a rate equal to 2.0% per annum in excess of the interest rates
otherwise payable under this Agreement with respect to Base Rate Loans. 

          SECTION
3.2.3. Payment Dates. Interest accrued on the Loans shall be payable,
without duplication: 

	
 

	
 

	
 

	
          (a)
  on the Stated Maturity Date therefor; 

	
 

	
 

	
 

	
          (b)
  on the date of any payment or prepayment, in whole or in part, of principal
  outstanding on such Loans on the principal amount so paid or prepaid; 

	
 

	
 

	
 

	
          (c)
  relative to Base Rate Loans, on each Quarterly Payment Date occurring after
  the Effective Date; 

	
 

	
 

	
 

	
          (d)
  relative to LIBO Rate Loans, on the last day of each applicable Interest
  Period (and, if such Interest Period shall exceed three months, on the date
  occurring on each three-month interval occurring after the first day of such
  Interest Period); 

-39-

	
 

	
 

	
 

	
          (e)
  relative to any Base Rate Loans converted into LIBO Rate Loans on a day when
  interest would not otherwise have been payable pursuant to clause (c), on the
  date of such conversion; and 

	
 

	
 

	
 

	
          (f)
  on that portion of any Loans the Stated Maturity Date of which is accelerated
  pursuant to Section 8.2 or 8.3, immediately upon such
  acceleration. 

          Interest
accrued on Loans or other monetary Obligations after the date such amount is
due and payable (whether on the Stated Maturity Date, upon acceleration or
otherwise) shall be payable upon demand. 

          SECTION 3.3. Fees. The Borrower
agrees to pay various fees
in accordance with Sections 3.3.1 and 3.3.2, all of which fees
shall be non-refundable. 

          SECTION 3.3.1. Fee Letter
Amounts. The Borrower agrees to
pay the fees set forth in the Fee Letter on the dates set forth in the Fee
Letter. 

          SECTION 3.3.2. Term II Loan
Commitment Fee. The Borrower
agrees to pay a commitment fee for the account of each Lender, for the period
(including any portion thereof when any of its Commitments are suspended by
reason of the Borrower’s inability to satisfy any condition of Article V)
commencing on the Effective Date and continuing through the Term II Loan
Commitment Termination Date, a commitment fee in an amount equal to 0.50% of
the average daily unused portion of the Term II Loan Commitment Amount. All
commitment fees payable pursuant to this Section shall be calculated on a year
comprised of 360 days and shall be payable by the Borrower in arrears on each
Quarterly Payment Date, commencing with the first Quarterly Payment Date
following the Effective Date, and on the Term II Loan Commitment Termination
Date. 

ARTICLE IV

CERTAIN LIBO RATE AND OTHER PROVISIONS 

          SECTION 4.1. LIBO
Rate Lending Unlawful.
If any Lender shall determine (which determination shall, upon notice to the
Borrower and the Administrative Agent, be conclusive and binding on the
Borrower) that the introduction of or any change in or in the interpretation of
any Applicable Law makes it unlawful, or any Governmental Authority asserts
that it is unlawful, for such Lender to make or continue any Loans as, or to
convert any Loans into, a LIBO Rate Loan, the obligations of such Lender to
make, continue or convert any such LIBO Rate Loan shall, upon such
determination, forthwith be suspended until such Lender shall notify the
Administrative Agent that the circumstances causing such suspension no longer
exist, and all outstanding LIBO Rate Loans payable to such Lender shall
automatically convert into Base Rate Loans at the end of the then current
Interest Periods with respect thereto or sooner, if required by such Applicable
Law or assertion. 

          SECTION 4.2. Deposits Unavailable. If the Administrative
Agent shall have determined that 

	
 

	
 

	
 

	
          (a)
  Dollar deposits in the relevant amount and for the relevant Interest Period
  are not available to it in its relevant market; or 

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          (b)
  by reason of circumstances affecting its relevant market, adequate means do
  not exist for ascertaining the interest rate applicable hereunder to LIBO
  Rate Loans; 

          then,
upon notice from the Administrative Agent to the Borrower and the Lenders, the
obligations of all Lenders under Section 2.2 and Section 2.4 to make or
continue any Loans as, or to convert any Loans into, LIBO Rate Loans shall
forthwith be suspended until the Administrative Agent shall notify the Borrower
and the Lenders that the circumstances causing such suspension no longer exist.

          SECTION 4.3. Increased LIBO Rate Loan
Costs, etc. The
Borrower agrees to reimburse each Lender for any increase in the cost to such
Lender of, or any reduction in the amount of any sum receivable by such Secured
Party in respect of, such Secured Party’s Commitments and the making of Credit
Extensions hereunder (including the making, continuing or maintaining (or of
its obligation to make or continue) any Loans as, or of converting (or of its
obligation to convert) any Loans into, LIBO Rate Loans) that arise in
connection with any change in, or the introduction, adoption, effectiveness,
interpretation, reinterpretation or phase-in after the Effective Date of, any
Applicable Law or request (whether or not having the force of law) of any
Governmental Authority, except for such changes relative to increased capital
costs and Taxes which are governed by Sections 4.5 and 4.6, respectively. Each
affected Secured Party shall promptly notify the Administrative Agent and the
Borrower in writing of the occurrence of any such event, stating the reasons therefor
and the additional amount required fully to compensate such Secured Party for
such increased cost or reduced amount. Such additional amounts shall be payable
by the Borrower directly to such Secured Party within five days of its receipt
of such notice, and such notice shall, in the absence of manifest error, be
conclusive and binding on the Borrower. 

          SECTION 4.4. Funding Losses. In
the event any Lender shall
incur any loss or expense (including any loss or expense incurred by reason of
the liquidation or reemployment of deposits or other funds acquired by such
Lender to make or continue any portion of the principal amount of any Loans as,
or to convert any portion of the principal amount of any Loans into, a LIBO
Rate Loan) as a result of 

	
 

	
 

	
 

	
          (a)
  any conversion or repayment or prepayment of the principal amount of any LIBO
  Rate Loan on a date other than the scheduled last day of the Interest Period
  applicable thereto, whether pursuant to Article III or otherwise; 

	
 

	
 

	
 

	
          (b)
  any Loans not being made as LIBO Rate Loans in accordance with the Borrowing
  Request therefor; or 

	
 

	
 

	
          (c)
  any Loans not being continued as, or converted into, LIBO Rate Loans in
  accordance with the Continuation/Conversion Notice therefor; 

          then,
upon the written notice of such Lender to the Borrower (with a copy to the
Administrative Agent), the Borrower shall, within five days of its receipt
thereof, pay directly to such Lender such amount as will (in the reasonable
determination of such Lender) reimburse such Lender for such loss or expense.
Such written notice shall, in the absence of manifest error, be conclusive and
binding on the Borrower. 

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          SECTION 4.5. Increased Capital
Costs. If any change in, or
the introduction, adoption, effectiveness, interpretation, reinterpretation or
phase-in of, any Applicable Law or request (whether or not having the force of
law) of any Governmental Authority affects or would affect the amount of
capital required or expected to be maintained by any Secured Party or any
Person controlling such Secured Party, and such Secured Party determines (in
good faith but in its sole and absolute discretion) that the rate of return on
its or such controlling Person’s capital as a consequence of the Commitments or
the Credit Extensions made, by such Secured Party is reduced to a level below
that which such Secured Party or such controlling Person could have achieved
but for the occurrence of any such circumstance, then upon notice from time to
time by such Secured Party to the Borrower, the Borrower shall within five days
following receipt of such notice pay directly to such Secured Party additional
amounts sufficient to compensate such Secured Party or such controlling Person
for such reduction in rate of return. A statement of such Secured Party as to
any such additional amount or amounts shall, in the absence of manifest error,
be conclusive and binding on the Borrower. In determining such amount, such
Secured Party may use any method of averaging and attribution that it (in its
sole and absolute discretion) shall deem applicable. 

          SECTION 4.6. Taxes. Relative to Taxes, the Borrower
covenants and agrees as follows; 

	
 

	
 

	
 

	
 

	
          (a)
  Any and all payments by the Borrower or any Subsidiary Guarantor under each
  Loan Document shall be made without setoff, counterclaim or other defense,
  and free and clear of, and without deduction or withholding for or on account
  of, any Taxes. In the event that any Taxes are imposed and required to be
  deducted or withheld from any payment required to be made by any Obligor to
  or on behalf of any Secured Party under any Loan Document, then:

	
 

	
 

	
 

	
 

	
          (i)
  subject to clause (f), if such Taxes are Non-Excluded Taxes, the
  amount of such payment shall be increased as may be necessary so that such
  payment is made, after withholding or deduction for or on account of such
  Taxes, in an amount that is not less than the amount provided for in such
  Loan Document; and

	
 

	
 

	
 

	
 

	
 

	
          (ii) the
  Borrower shall withhold the full amount of such Taxes from such payment (as
  increased pursuant to clause (a)(i)) and shall pay such amount to the
  Governmental Authority imposing such Taxes in accordance with Applicable Law.
  

	
 

	
 

	
 

	
 

	
          (b)
  In addition, the Borrower shall pay all Other Taxes imposed to the relevant
  Governmental Authority imposing such Other Taxes in accordance with
  Applicable Law. 

	
 

	
 

	
 

	
          (c)
  As promptly as practicable after the payment of any Taxes or Other Taxes, and
  in any event within 45 days of any such payment being due, the Borrower shall
  furnish to the Administrative Agent a copy of an official receipt (or a
  certified copy thereof) evidencing the payment of such Taxes or Other Taxes.
  The Administrative Agent shall make copies thereof available to any Lender
  upon request therefor.

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          (d)  Subject to clause (f), the Borrower shall
  indemnify each Secured Party for any Non-Excluded Taxes and Other Taxes
  levied, imposed or assessed on (and whether or not paid directly by) such
  Secured Party whether or not such Non-Excluded Taxes or Other Taxes are
  correctly or legally asserted by the relevant Governmental Authority.
  Promptly upon having knowledge that any such Non-Excluded Taxes or Other
  Taxes have been levied, imposed or assessed, and promptly upon notice thereof
  by any Secured Party, the Borrower shall pay such Non-Excluded Taxes or Other
  Taxes directly to the relevant Governmental Authority (provided that, no
  Secured Party shall be under any obligation to provide any such notice to the
  Borrower). In addition, the Borrower shall indemnify each Secured Party for
  any incremental Taxes that may become payable by such Secured Party as a
  result of any failure of the Borrower to pay any Taxes when due to the
  appropriate Governmental Authority or to deliver to the Administrative Agent,
  pursuant to clause (c), documentation evidencing the payment of Taxes or
  Other Taxes. With respect to indemnification for Non-Excluded Taxes and Other
  Taxes actually paid by any Secured Party or the indemnification provided in
  the immediately preceding sentence, such indemnification shall be made within
  30 days after the date such Secured Party makes written demand therefor. The
  Borrower acknowledges that any payment made to any Secured Party or to any
  Governmental Authority in respect of the indemnification obligations of the
  Borrower pursuant to this clause shall constitute a payment in respect of
  which the provisions of clause (a) and this clause shall apply. The indemnity
  provided for herein shall survive the payment of the Obligations and
  termination of this Agreement.

	
 

	
 

	
 

	
          (e)
  Each Non-U.S. Lender, on or prior to the date on which such Non-U.S.
Lender becomes a Lender hereunder (and from time to time thereafter upon the request
 of the Borrower or the Administrative Agent, but only for so long as such Non-U.S. Lender
 is legally entitled to do so), shall deliver to the Borrower and the Administrative Agent
 either (i) two duly completed copies of either (x) Internal Revenue Service Form W-8BEN claiming
 eligibility of the Non-U.S. Lender for benefits of an income tax treaty to which the United States is
 a party or (y) Internal Revenue Service Form W-8ECI, or in either case an applicable successor form; or
 (ii) in the case of a Non-U.S. Lender that is not legally entitled to deliver either form listed in clause (e)(i), (x) a certificate
 (an “Exemption Certificate”) to the effect that such Non-U.S. Lender is not (A) a “bank” within the meaning
 of Section 881(c)(3)(A) of the Code, (B) a “10 percent shareholder” of the Borrower within the meaning of
 Section 881(c)(3)(B) of the Code or (C) a controlled foreign corporation receiving interest from a
related person within the meaning of Section 881(c)(3)(C) of the Code and (y) two duly completed copies
 of Internal Revenue Service Form W-8BEN or applicable successor form.

	
 

	
 

	
 

	
          (f)
  The Borrower shall not be obligated to pay any additional amounts to any
  Lender pursuant to clause (a)(i), or to indemnify any Lender pursuant
  to clause (d), in respect of United States federal withholding taxes
  to the extent imposed as a result of (x) the failure of such Lender to
  deliver to the Borrower any form or Exemption Certificate, as applicable to
  such Lender, pursuant to clause (e), (y) any such form or Exemption
  Certificate not establishing a complete exemption from U.S. federal
  withholding tax or the information or certifications made therein by the
  Lender being untrue or inaccurate on the date delivered in any material
  respect or (z) the Lender

-43-

	
 

	
 

	
 

	
designating
  a successor lending office at which it maintains its Loans which has the
  effect of causing such Lender to become obligated for tax payments in excess
  of those in effect immediately prior to such designation; provided, however,
  that the Borrower shall be obligated to pay additional amounts to any such
  Lender pursuant to clause (a)(i), and to indemnify any such Lender
  pursuant to clause (d), in respect of United States federal withholding taxes
  if (i) any such failure to deliver a form or forms or an Exemption Certificate
  or the failure of such form or forms or Exemption Certificate to establish a
  complete exemption from U.S. federal withholding tax or inaccuracy or untruth
  contained therein resulted from a change in any applicable statute, treaty,
  regulation or other applicable law or any interpretation of any of the
  foregoing occurring after the Effective Date, which change rendered such
  Lender no longer legally entitled to deliver such form or forms or Exemption
  Certificate or otherwise ineligible for a complete exemption from U.S.
  federal withholding tax, or rendered the information or certifications made
  in such form or forms or Exemption Certificate untrue or inaccurate in a
  material respect, (ii) the redesignation of the Lender’s lending office was
  made at the request of the Borrower or (iii) the obligation to pay any
  additional amounts to any such Lender pursuant to clause (a)(i) or to
  indemnify any such Lender pursuant to clause (d) is with respect to
  any Person that becomes a Lender as a result of an assignment made at the
  request of the Borrower.

          SECTION 4.7. Payments, Computations, Proceeds of Collateral,
etc. Relative to the timing, application and calculation of payments, the
Borrower covenants and agrees as follows: 

	
 

	
 

	
 

	
          (a)
  Unless otherwise expressly provided in a Loan Document, all payments by the
  Borrower pursuant to each Loan Document shall be made by the Borrower to the
  Administrative Agent for the pro rata account of the Secured Parties entitled
  to receive such payment. All payments shall be made without setoff, deduction
  or counterclaim not later than 11:00 a.m. on the date due in same day or
  immediately available funds to such account as the Administrative Agent shall
  specify from time to time by notice to the Borrower. Funds received after
  that time shall be deemed to have been received by the Administrative Agent
  on the next succeeding Business Day. The Administrative Agent shall promptly
  remit in same day funds to each Secured Party its share, if any, of such
  payments received by the Administrative Agent for the account of such Secured
  Party. All interest (including interest on LIBO Rate Loans) and fees shall be
  computed on the basis of the actual number of days (including the first day
  but excluding the last day) occurring during the period for which such
  interest or fee is payable over a year comprised of 360 days (or, in the case
  of interest on a Base Rate Loan (calculated at other than the Federal Funds
  Rate), 365 days or, if appropriate, 366 days). Payments due on a day other
  than a Business Day shall (except as otherwise required by clause (c)
  of the definition of “Interest Period”) be made on the next succeeding
  Business Day and such extension of time shall be included in computing
  interest and fees in connection with that payment. 

	
 

	
 

	
 

	
          (b)
  All amounts received as a result of the exercise of remedies under the Loan
  Documents (including from the proceeds of collateral securing the
  Obligations) or under Applicable Law shall be applied upon receipt to the
  Obligations as follows: (i) first, to the payment of all Obligations owing to
  the Administrative Agent, in its capacity as the 

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Administrative
  Agent (including the fees and expenses of counsel to the Administrative
  Agent), (ii) second, after payment in full in cash of the amounts specified
  in clause (b)(i), to the ratable payment of all interest (including interest
  accruing after the commencement of a proceeding in bankruptcy, insolvency or
  similar law, whether or not permitted as a claim under such law) and fees
  owing under the Loan Documents, and all costs and expenses owing to the
  Secured Parties pursuant to the terms of the Loan Documents, until paid in
  full in cash, (iii) third, after payment in full in cash of the amounts
  specified in clauses (b)(i) and (b)(ii), to the ratable payment
  of (A) the principal amount of the Loans then outstanding, (B) credit
  exposure owing to Secured Parties under Lender Hedging Agreements and (C) the
  Obligations referenced in clauses (x) and (y) of the definition
  of “Obligations” (set forth in Section 1.1) to the Secured Parties
  also referenced therein, (iv) fourth, after payment in full in cash of the
  amounts specified in clauses (b)(i) through (b)(iii), to the
  ratable payment of all other Obligations owing to the Secured Parties, and
  (v) fifth, after payment in full in cash of the amounts specified in clauses
  (b)(i) through (b)(iv), and following the Termination Date, to each
  applicable Obligor or any other Person lawfully entitled to receive such
  surplus.

	
 

	
 

	
 

	
          (c)
  The Borrower acknowledges that the Lenders have agreed to the amount of the
  Applicable Margin and fees payable under the Loan Documents based upon, among
  other things, the delivery by the Borrower pursuant to Section 7.1.1
  of accurate and actual reporting of results of operation and that the
  financial covenant ratios set forth in a Compliance Certificate shall only be
  treated by the Secured Parties as presumptive evidence of such actual
  results. If the actual Leverage Ratio for any period is higher than that set
  forth in a Compliance Certificate for such period, then the amount of
  interest and fees owing for such period shall be established by reference to
  the actual Leverage Ratio, and not the ratio set forth in the Compliance
  Certificate. Promptly, and in any event within three days, following the
  earlier of (x) the Borrower’s receipt of a notice from the Administrative
  Agent pursuant to this clause and (y) the Borrower’s knowledge that the
  Leverage Ratio for a particular period was higher than that reported in the
  Compliance Certificate for such period, the Borrower shall pay to the
  Administrative Agent all unpaid interest and fees for such period based upon
  the actual Leverage Ratio. In no event shall the Lenders be required to
  rebate interest or fees paid by the Borrower, and the payment of incremental
  interest and fees pursuant to this clause shall not impair (and is without
  limitation of) the other rights and remedies of the Secured Parties under the
  Loan Documents.

          SECTION 4.8. Sharing of Payments.
If any Secured Party
shall obtain any payment or other recovery (whether voluntary, involuntary, by
application of setoff or otherwise) on account of any Credit Extension (other
than pursuant to Sections 4.3, 4.4, 4.5 or 4.6) in excess of its pro
rata share of payments obtained by all Secured Parties, such Secured Party
shall purchase from the other Secured Parties such participations in Credit
Extensions made by them as shall be necessary to cause such purchasing Secured
Party to share the excess payment or other recovery ratably (to the extent such
other Secured Parties were entitled to receive a portion of such payment or
recovery) with each of them; provided, however, that, if all or
any portion of the excess payment or other recovery is thereafter recovered
from such purchasing Secured Party, the purchase shall be rescinded and each
Secured Party which has sold a participation to the purchasing Secured Party
shall repay to the purchasing Secured Party the purchase price to the 

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 ratable extent of such recovery together with
an amount equal to such selling Secured Party’s ratable share (according to the
proportion of (x) the amount of such selling Secured Party’s required repayment
to the purchasing Secured Party to (y) total amount so recovered from the
purchasing Secured Party) of any interest or other amount paid or payable by
the purchasing Secured Party in respect of the total amount so recovered. The
Borrower agrees that any Secured Party purchasing a participation from another
Secured Party pursuant to this Section may, to the fullest extent permitted by
Applicable Law, exercise all its rights of payment (including pursuant to Section
4.9) relative to such participation as fully as if such Secured Party were
the secured, direct creditor of the Borrower in the amount of such
participation. If under any applicable bankruptcy, insolvency or other similar
law any Secured Party receives a secured claim in lieu of a setoff to which
this Section applies, such Secured Party shall, to the extent practicable,
exercise its rights in respect of such secured claim in a manner consistent
with the rights of the Secured Parties entitled under this Section to share in
the benefits of any recovery on such secured claim. 

          SECTION 4.9. Setoff. Each Secured Party
shall, upon the occurrence
and during the continuance of any Default described in clauses (a)
through (d) of Section 8.1.9 or, with the consent of the Required
Lenders, upon the occurrence and during the continuance of any other Event of
Default, have the right to appropriate and apply to the payment of the
Obligations owing to it (whether or not then due), and (as security for such
Obligations) the Borrower hereby grants to each Secured Party a continuing
security interest in, any and all balances, credits, deposits, accounts or
moneys of the Borrower then or thereafter maintained with such Secured Party; provided,
however, that any such appropriation and application shall be subject to
the provisions of Section 4.8. Each Secured Party agrees promptly to notify the
Borrower and the Administrative Agent after any such appropriation and
application made by such Secured Party; provided, however, that
the failure to give such notice shall not affect the validity of such setoff
and application. The rights of each Secured Party under this Section are in
addition to other rights and remedies (including other rights of setoff under
Applicable Law or otherwise) which such Secured Party may have. 

ARTICLE V 

CONDITIONS TO EFFECTIVENESS AND CREDIT EXTENSIONS

          SECTION 5.1. Effectiveness. The
effectiveness of this
Agreement shall be subject to the prior or concurrent satisfaction of each of
the conditions precedent set forth in this Section 5.1. 

          SECTION 5.1.1. Resolutions, etc. The Administrative Agent
shall have received from each Obligor, as applicable, (i) a copy of a good
standing certificate from its jurisdiction of organization (and with respect to
the Borrower, from the States of Idaho and Alaska), dated a date reasonably
close to the Effective Date, and (ii) a certificate, dated the Effective Date
with counterparts for each Lender, duly executed and delivered by such Person’s
Secretary or Assistant Secretary, managing member or general partner, as
applicable, as to 

	
 

	
 

	
 

	
          (a)
  resolutions of each such Person’s Board of Directors then in full force and
  effect authorizing, to the extent relevant, all aspects of the Transaction
  applicable to such Person and the execution, delivery and performance of each
  Loan Document to be executed by such Person and the transactions contemplated
  hereby and thereby; 

-46-

	
 

	
          (b)
  the incumbency and signatures of those of its officers, managing member or
  general partner, as applicable, authorized to act with respect to each Loan
  Document to be executed by such Person; and 

	
 

	
 

	
 

	
          (c)
  the full force and validity of each Organic Document of such Person and
  certified copies thereof; 

upon which
certificates each Secured Party may conclusively rely until it shall have
received a further certificate of the Secretary, Assistant Secretary, managing
member or general partner, as applicable, of any such Person canceling or
amending the prior certificate of such Person. 

          SECTION 5.1.2. Effective Date
Certificate. The Administrative
Agent shall have received the Effective Date Certificate, dated the Effective
Date and duly executed and delivered by an Authorized Officer of the Borrower,
in which certificate the Borrower shall agree and acknowledge that the
statements made therein shall be deemed to be true and correct representations
and warranties of the Borrower as of such date, and, at the time each such
certificate is delivered, such statements shall in fact be true and correct.
All documents and agreements (including Transaction Documents) required to be
appended to the Effective Date Certificate shall be in form and substance
reasonably satisfactory to the Administrative Agent, shall have been executed
and delivered by the requisite parties, and shall be in full force and effect. 

          SECTION 5.1.3. Consummation of
Transaction. The
Administrative Agent shall have received evidence reasonably satisfactory to it
that concurrently with the funding of the Loans all actions shall have been
taken necessary to consummate the Transaction in accordance with the terms of
each applicable Transaction Document, and the Administrative Agent shall have
received copies of each applicable Transaction Document executed and delivered
by the parties thereto, which Transaction Documents shall be in form and
substance reasonably satisfactory to the Administrative Agent; provided that no
material condition or other provision of the Acquisition Agreement shall have
been waived, amended, supplemented or otherwise modified without the consent of
the Administrative Agent (it being understood that (a) any condition or
provision relating to consents of governmental authorities and other third
parties to the Transaction and other transactions contemplated hereby and (b)
an aggregate purchase price due and payable on the Effective Date of more than
$750,000,000 shall be deemed material (and it being further understood the
value of any Capital Securities constituting a portion of the purchase price
shall be valued in the same manner as provided for in the Acquisition
Agreement)). The Administrative Agent shall be reasonably satisfied with the
capitalization, structure (including the tax structure) and ownership of the
Borrower, its Subsidiaries and the Greens Creek Joint Venture after giving
effect to the Transaction and the sources and uses of funds with respect to the
Transaction. In furtherance of, and not in limitation of, the foregoing, the
Administrative Agent shall have received evidence reasonably satisfactory to
the Administrative Agent that, concurrently with the funding of the Loans Hecla
Admiralty shall have acquired 100% of the issued and outstanding Capital
Securities of Kennecott and Kennecott Juneau. 

          SECTION 5.1.4. Payment of Outstanding
Indebtedness, etc.
All Refinanced Debt, together with all interest, all prepayment premiums and
other amounts due and payable with 

-47-

respect thereto, shall have
been paid in full from the proceeds of the initial Credit Extension and other
available funds and all commitments and Liens in respect of such Refinanced
Debt shall have been terminated. The Borrower shall have 

	
 

	
 

	
 

	
          (a)
  delivered to the Administrative Agent all documents or instruments necessary
  to evidence that all Refinanced Debt is concurrently being repaid on the
  Effective Date, and 

	
 

	
 

	
 

	
          (b)
  made arrangements satisfactory to the Administrative Agent relative to the
  cancellation of any letters of credit outstanding thereunder to support the
  obligations of the Borrower and Subsidiaries with respect thereto. 

          SECTION 5.1.5. Delivery of Notes.
The Administrative Agent
shall have received, for the account of each Lender that has requested a Note,
such Lender’s Note duly executed and delivered by an Authorized Officer of the
Borrower. 

          SECTION 5.1.6. Financial Information, etc. The Lenders
shall have received, 

	
 

	
 

	
 

	
          (a)
  audited consolidated balance sheets and related statements of income and cash
  flows of the Borrower and its Subsidiaries as at December 31, 2007; 

	
 

	
 

	
 

	
          (b)
  unaudited consolidated balance sheets and related statements of income and
  cash flows of the Borrower and its Subsidiaries for the Fiscal Quarters ended
  June 30, 2007, September 30, 2007 and December 31, 2007, which financial
  statements shall not be materially inconsistent with the financial statements
  or forecasts previously provided to the Administrative Agent and shall have
  been prepared in accordance with GAAP; and 

	
 

	
 

	
 

	
          (c)
  (i) a pro forma consolidated balance sheet of the Borrower and its
  Subsidiaries as of December 31, 2007, and prepared on or immediately prior to
  the Effective Date as if the Credit Extensions had been made and the
  Transaction consummated as of December 31, 2007 and (ii) pro forma
  related statements of income and cash flow, as of December 31, 2007, and
  prepared on or immediately prior to the Effective Date as if the Credit
  Extensions had been made and the Transactions had been consummated as of
  January 1, 2007,in each case
  certified by the chief financial or accounting Authorized Officer of the
  Borrower which shall be reasonably satisfactory to the Administrative
  Agent.  

          SECTION 5.1.7. Solvency, etc. The
Administrative Agent
shall have received, with counterparts for each Lender, a certificate as to the
Solvency of each Obligor, duly executed and delivered by the chief financial or
accounting Authorized Officer of the Borrower, dated as of the Effective Date,
in form and substance satisfactory to the Administrative Agent. 

          SECTION 5.1.8. Subsidiary
Guaranty. The Administrative
Agent shall have received, with counterparts for each Lender, the Subsidiary
Guaranty, dated as of the date hereof, duly executed and delivered by an
Authorized Officer of each Material U.S. Subsidiary of the Borrower. 

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          SECTION 5.1.9. Pledge Agreement and Security Agreement. The
Administrative Agent shall have received executed counterparts of the Pledge
Agreement (duly executed and delivered by an Authorized Officer of Borrower and
each Material U.S. Subsidiary and each U.S. Subsidiary holding Capital
Securities of a Material U.S. Subsidiary (after giving effect to the
Transaction) or intercompany Indebtedness) and the Security Agreement (duly
executed and delivered by an Authorized Officer of each of the Greens Creek
Participants), each dated as of the Effective Date, together with: 

	
 

	
 

	
 

	
          (a)
  in the case of Capital Securities that are certificated securities (as
  defined in the UCC), certificates evidencing all of the issued and
  outstanding Capital Securities of a U.S. Subsidiary owned by each Obligor
  (subject, however, to the limitations, if any, provided for in Section
  7.1.8), which certificates shall be accompanied by undated instruments of
  transfer duly executed in blank, or, if any Capital Securities of a U.S. Subsidiary
  that are uncertificated securities (as defined in the UCC), confirmation and
  evidence satisfactory to the Administrative Agent that the security interest
  therein has been transferred to and perfected by the Administrative Agent for
  the benefit of the Secured Parties in accordance with Articles 8 and 9 of the
  UCC and other Applicable Laws as to the perfection of the pledge of such
  Capital Securities; 

	
 

	
 

	
 

	
          (b)
  Filing Statements suitable in form for naming the Borrower and each
  Subsidiary Guarantor as a debtor and the Administrative Agent as the secured
  party, or other similar instruments or documents to be filed under the UCC of
  all jurisdictions as may be necessary or, in the opinion of the
  Administrative Agent, desirable to perfect the first priority security
  interests (including security interests in respect of Capital Securities that
  are uncertificated securities (as defined in the UCC) of the Administrative
  Agent granted pursuant to the Security Agreement and the Pledge Agreement, as
  the case may be; 

	
 

	
 

	
 

	
          (c)
  UCC Form UCC-3 termination statements, if any, necessary to release all Liens
  (other than Liens permitted by clause (c) of Section 7.2.3) and
  other rights of any Person in any collateral described in any security
  agreement previously granted by any Person, together with such other UCC Form
  UCC-3 termination statements as the Administrative Agent may reasonably
  request from such Obligors; and 

	
 

	
 

	
 

	
          (d)
  copies of UCC searches, dated a date reasonably near to the Effective Date,
  listing all effective financing statements which name any Obligor (under its
  present name and any previous names during the last five years) as the
  debtor, together with copies of such financing statements (none of which
  shall, except relative to Liens permitted by clause (c) of Section
  7.2.3, evidence a Lien on any collateral described in any Loan Document).
  

          SECTION 5.1.10. Filing Agent,
etc. All Uniform Commercial
Code financing statements or other similar financing statements and Uniform
Commercial Code (Form UCC-3) termination statements required pursuant to the
Loan Documents (collectively, the “Filing Statements”) shall have been
delivered to Corporation Service Company or another similar filing service
company acceptable to the Administrative Agent (the “Filing Agent”). The
Filing Agent shall have acknowledged in a writing satisfactory to the
Administrative Agent and its counsel (i) 

-49-

the Filing
Agent’s receipt of all Filing Statements, (ii) that the Filing Statements have
either been submitted for filing in the appropriate filing offices or will be
submitted for filing in the appropriate offices within ten days following the
Effective Date and (iii) that the Filing Agent will notify the Administrative
Agent and its counsel of the results of such submissions within 30 days
following the Effective Date. 

          SECTION 5.1.11.
Insurance. The Administrative Agent shall have
received, certificates from one or more insurance companies satisfactory to the
Administrative Agent, evidencing coverage required to be maintained pursuant to
each Loan Document. 

          SECTION 5.1.12. Opinion of
Counsel. The Administrative
Agent shall have received (i) an opinion, dated the Effective Date and
addressed to the Administrative Agent and all Lenders, from Bell, Boyd &
Lloyd LLP, counsel to the Obligors, in form and substance satisfactory to the
Administrative Agent and (ii) if an opinion is delivered by the sellers under
the Acquisition Agreement in connection with the Acquisition, written evidence
that the Administrative Agent and the Lenders have been permitted to rely on
such opinion, which written evidence shall be in form and substance
satisfactory to the Administrative Agent. 

          SECTION 5.1.13. Closing Fees,
Expenses, etc. The
Administrative Agent shall have received for its own account, or for the
account of each Lender, as the case may be, all fees, costs and expenses due
and payable pursuant to Sections 3.3 and, if then invoiced, 10.3.

          SECTION 5.1.14. PATRIOT Act
Disclosures. The Administrative
Agent and each Lender shall have received all PATRIOT Act Disclosures requested
by them prior to execution of this Agreement.

          SECTION 5.1.15. Compliance
Certificate. The Lenders shall
have received an initial Compliance Certificate on a pro forma basis as
if the Credit Extension had been made and the Transaction had been consummated
as of, with respect to balance sheet items, December 31, 2007, or with respect
to cash flow or income statement items, January 1, 2007, duly executed (and
with all schedules thereto duly completed) and delivered by the chief financial
or accounting Authorized Officer of the Borrower and showing compliance with
the covenants set forth in Section 7.2.4. 

          SECTION 5.1.16. Hecla Mine Plan.
The Administrative Agent
shall have received the most current Hecla Mine Plan in form and substance
reasonably acceptable to the Administrative Agent. 

          SECTION 5.2. All Credit
Extensions. The obligation of each
Lender to make any Credit Extension shall be subject to the satisfaction of
each of the conditions precedent set forth below. 

          SECTION 5.2.1. Compliance with Warranties, No Default, etc.
Both before and after giving effect to the Credit Extension, the following
statements shall be true and correct: 

	
 

	
 

	
 

	
          (a)
  the representations and warranties set forth in each Loan Document shall be
  true and correct in all material respects with the same effect as if then
  made (unless stated to relate solely to an earlier date, in which case such
  representations and warranties shall have been true and correct in all
  material respects as of such earlier 

-50-

	
 

	
 

	
 

	
date), in
  each case other than representations and warranties that are subject to a
  materiality qualifier, in which case such representations and warranties
  shall be (or shall have been) true and correct; and 

	
 

	
 

	
 

	
          (b)
  no Default shall have then occurred and be continuing. 

          SECTION 5.2.2. Credit Extension
Request, etc. The
Administrative Agent shall have received a Borrowing Request. Each of the
delivery of a Borrowing Request and the acceptance by the Borrower of the
proceeds of such Credit Extension shall constitute a representation and
warranty by the Borrower that on the date of such Credit Extension (both
immediately before and after giving effect to such Credit Extension and the
application of the proceeds thereof) the statements made in Section 5.2.1
are true and correct (unless stated to relate solely to an earlier date, in
which case such representations and warranties shall be true and correct as of
such earlier date). 

          SECTION 5.2.3. Satisfactory Legal
Form. All documents
executed or submitted pursuant hereto by or on behalf of any Obligor shall be
reasonably satisfactory in form and substance to the Administrative Agent and
its counsel, and the Administrative Agent and its counsel shall have received
all information, approvals, opinions, documents or instruments as the
Administrative Agent or its counsel may reasonably request. 

ARTICLE VI 

REPRESENTATIONS AND WARRANTIES

          In
order to induce the Secured Parties to enter into this Agreement and to make
Credit Extensions hereunder, the Borrower (after giving effect to the
Acquisition) represents and warrants to each Secured Party as set forth in this
Article. 

          SECTION 6.1. Organization, etc.
Each Obligor is validly
organized and existing and in good standing under the laws of the state or
jurisdiction of its incorporation or organization, is duly qualified to do business
and is in good standing as a foreign entity in each jurisdiction where the
nature of its business requires such qualification (except to the extent such
failure would not have a material adverse effect on the business of such
Obligor) and has full power and authority and holds all requisite Approvals to
enter into and perform its Obligations under each Loan Document to which it is
a party, to own and hold under lease its property and to conduct its business
substantially as currently conducted by it. 

          SECTION 6.2. Due Authorization, Non-Contravention, etc. The
execution, delivery and performance by each Obligor of each Loan Document
executed or to be executed by it, each Obligor’s participation in the
consummation of all aspects of the Transaction, and the execution, delivery and
performance by the Borrower or (if applicable) any Obligor of the agreements
executed and delivered by it in connection with the Transaction are in each
case within such Person’s powers, have been duly authorized by all necessary
action, and do not: 

	
 

	
 

	
 

	
          (a)
  contravene any Obligor’s Organizational Documents, or any Applicable Law; or 

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          (b)
  result in or require the creation or imposition of, any Lien on any Obligor’s
  properties (except as permitted by this Agreement) or (ii) result in a breach
  of, or a default under, any contractual restriction binding on or affecting
  any Obligor. 

          SECTION 6.3. Government Approval,
Regulation, etc. Except
as set forth on Schedule 6.3, no material Approval or other action by, and no
notice to or filing with any Governmental Authority or other Person (other than
those that have been, or on the Effective Date will be, duly obtained or made
and which are, or on the Effective Date will be, in full force and effect) is
required for the Borrower or any of its Subsidiaries to continue its operations
as presently conducted, the consummation of the Transaction or the due
execution, delivery or performance by any Obligor of any Loan Document to which
it is a party, or for the due execution, delivery or performance of any
Transaction Document to which it is a party. Neither the Borrower nor any
Subsidiary is an “investment company” within the meaning of the Investment
Company Act of 1940. None of any Obligor or any Subsidiary (x) are listed on
the “Specially Designated Nationals and Blocked Person List” maintained by the
Office of Foreign Assets Control (“OFAC”), the Department of the Treasury, or
included in any executive orders relating thereto or (y) have used the proceeds
of the Credit Extensions in violation in any material respect of any of the
foreign asset control regulations of OFAC or any Applicable Law. 

          SECTION 6.4. Validity, etc. Each
Loan Document and other
Transaction Documents to which any Obligor is a party constitutes the legal,
valid and binding obligations of such Obligor, enforceable against such Obligor
in accordance with their respective terms (except, in any case, as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization or similar laws affecting creditors’ rights generally and by
principles of equity). The Liens granted by each Obligor in favor of the
Secured Parties constitutes valid obligations of such Obligor, enforceable
against such Obligor in accordance with Applicable Law (except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization or similar laws affecting creditors’ rights generally and by
principles of equity). 

          SECTION 6.5. Financial Information; Undisclosed Liabilities.

	
 

	
 

	
 

	
          (a) The
  financial statements of the Borrower and its Subsidiaries, furnished to the
  Administrative Agent and each Lender pursuant to Section 5.1.6, have
  been prepared in accordance with GAAP consistently applied, present fairly
  the consolidated financial condition of the Persons covered thereby as at the
  dates thereof and the results of their operations for the periods then ended,
  and do not contain any incorrect or misleading statement of a material fact
  or omit any material fact necessary to make the statements contained herein
  or therein not misleading as of the date made or deemed made. All balance
  sheets, all statements of income and of cash flow and all other financial
  information of each of the Borrower and its Subsidiaries furnished pursuant
  to Section 7.1.1, have been and will for periods following the
  Effective Date be prepared in accordance with GAAP consistently applied with
  the financial statements delivered pursuant to Section 5.1.6, and do
  or will present fairly the consolidated financial condition of the Persons
  covered thereby as at the dates thereof and the results of their operations
  for the periods then ended. 

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          (b)
  There are no material liabilities of any Obligor or the Greens Creek Joint
  Venture of any kind whatsoever, whether accrued, determined, determinable or
  contingent, other than those liabilities provided for or disclosed in the
  most recently delivered financial statements or the notes thereto, those
  liabilities not required under GAAP to be provided for or disclosed in the
  most recently delivered financial statements or the notes thereto, those
  liabilities that have been disclosed in the Disclosure Schedule and
  liabilities arising in the ordinary course of business since the date of the
  most recently delivered financial statements. 

          SECTION 6.6. No Material Adverse
Change. There has been no
Material Adverse Change. 

          SECTION 6.7. Litigation, Labor Controversies, etc. There is
no pending or, to the knowledge of the Borrower or any of its Subsidiaries,
threatened litigation, action, proceeding or labor controversy (including any
strikes, walkouts or work slowdowns) 

	
 

	
 

	
 

	
          (a)
  except as disclosed in Item 6.7 of the Disclosure Schedule, affecting the
  Borrower or any of its Subsidiaries or the Greens Creek Joint Venture, or any
  of their respective properties, businesses or assets which could reasonably
  be expected to have, individually or in the aggregate, a Material Adverse
  Effect, and no adverse development has occurred in any labor controversy,
  litigation, arbitration or governmental investigation or proceeding disclosed
  in Item 6.7 of the Disclosure Schedule which could reasonably be
  expected to have a material adverse effect on the outcome for the Borrower or
  its Subsidiaries of such labor controversy, litigation, arbitration or
  governmental investigation or proceeding; or 

	
 

	
 

	
 

	
          (b)
  which purports to affect the legality, validity or enforceability of any Loan
  Document, the Transaction Documents or the Transaction. 

          SECTION 6.8. Subsidiaries. The Borrower
has no Subsidiaries,
except those Subsidiaries which are identified in Item 6.8 of the
Disclosure Schedule, or which are permitted to have been organized or acquired
in accordance with Sections 7.2.5 or 7.2.9. In addition, set
forth in Item 6.8 of the Disclosure Schedule is an organizational chart
of the Borrower and each of its Subsidiaries as of the Effective Date, which
includes a description of the Capital Securities of each Subsidiary and the
owners thereof. 

          SECTION 6.9. Ownership of
Properties. 

	
 

	
 

	
 

	
          (a)
  The Borrower and each of its Material Subsidiaries owns (i) in the case of
  owned real property, good and marketable fee title to, and (ii) in the case
  of owned personal property, good and valid title to, or, (iii) in the case of
  leased real or personal property, valid and enforceable leasehold interests
  (as the case may be) in, all of its material properties and assets (including
  material mining, water and other rights or permits associated with its
  operations), real and personal, tangible and intangible, of any nature
  whatsoever, free and clear in each case of all Liens or claims, except for
  Liens permitted pursuant to Section 7.2.3.  

-53-

	
 

	
 

	
 

	
          (b) Without
limiting the generality of the foregoing clause (a), all lands being mined by
the Greens Creek Joint Venture (other than land not material to the Greens
Creek Joint Venture’s production of metals) are subject to (i) patented
claims of the Greens Creek Joint Venture or (ii) the Land Exchange Agreement. 

	
 

	
 

	
          SECTION 6.10. Taxes. The Borrower and each of its
 Subsidiaries has filed all tax returns and reports required by Applicable Law
 to have been filed by it and has paid all Taxes thereby shown to be due and
 owing, except any such Taxes which are being diligently contested in good
 faith by appropriate proceedings and for which adequate reserves in
 accordance with GAAP shall have been set aside on its books. 

	
 

	
 

	
          SECTION 6.11. Pension and Welfare Plans. 

	
 

	
 

	
 

	
          (a)
 Except as disclosed on Item 6.11 of the Disclosure Schedule, neither
 the Borrower, nor any of its Subsidiaries, nor any member of their Controlled
 Group (i) maintains or contributes to any Pension Plan or Multiemployer Plan,
 (ii) has maintained or contributed to any Pension Plan or Multiemployer Plan
 during the prior six years, (iii) except as required by Section 4980B of the
 Code or similar state law, maintains a Welfare Plan which provides health or
 welfare benefits (through the purchase of insurance or otherwise) for any
 retired or former employee of the Borrower or any of member of its Controlled
 Group or coverage after a participant’s termination of employment, or (iv)
 has incurred any liability or obligation under the U.S. Worker Adjustment and
 Retraining Notification Act or similar state law, which remains unpaid or
 unsatisfied. 

	
 

	
 

	
 

	
          (b)
 During the twelve-consecutive-month period prior to the Effective Date and
 prior to the date of any Credit Extension hereunder, (i) no steps have been
 taken to terminate any Pension Plan (other than a standard termination under
 Section 4041(b) of ERISA which would not reasonably be expected to have a
 Material Adverse Effect), (ii) no contribution failure has occurred with
 respect to any Pension Plan sufficient to give rise to a Lien under Section
 303(k) of ERISA, (iii) no determination has been made that a Pension Plan is,
 or is expected to be, in “at-risk” status (as defined in Section 303(i)(4)(A)
 of ERISA or Section 430(i)(4)(A) of the Code); and (iv) no determination has
 been made that a Multiemployer Plan is, or is expected to be, in endangered
 or critical status (as defined in Section 305 of ERISA). No condition exists
 or event or transaction has occurred with respect to any Pension Plan or
 Multiemployer Plan which might result in the incurrence by the Borrower or
 any member of the Controlled Group of any material liability, fine or
 penalty. Except as disclosed in Item 6.11 of the Disclosure Schedule,
 neither the Borrower nor any member of the Controlled Group has any
 contingent liability with respect to any post-retirement benefit under a
 Welfare Plan, other than liability for continuation coverage described in
 Part 6 of Title I of ERISA. 

	
 

	
 

	
          SECTION 6.12. Environmental Warranties. Except as set
forth in Item 6.12 of the Disclosure Schedule:  

	
 

	
 

	
 

	
          (a)
 all facilities and property (including underlying groundwater) owned or
 leased by the Borrower or any Subsidiary or by the Greens Creek Joint Venture
 have 

-54-

	
 

	
 

	
 

	
been, and
 continue to be, owned or leased by the Borrower and Subsidiaries in material
 compliance with all Environmental Laws, except as, individually or in the
 aggregate, could not be reasonably expected to have a Material Adverse
 Effect; 

	
 

	
 

	
 

	
          (b)
 there have been no past, and there are no pending or threatened written (i)
 claims, complaints, notices or requests for information received by the
 Borrower or any Subsidiaries or by the Greens Creek Joint Venture relative to
 any alleged violation of any Environmental Law that, individually or in the
 aggregate, have, or could reasonably be expected to have, a Material Adverse
 Effect, or (ii) complaints, notices or inquiries to the Borrower, any
 Subsidiary or to the Greens Creek Joint Venture regarding potential liability
 under any Environmental Law, that, individually or in the aggregate, have, or
 could reasonably be expected to have, a Material Adverse Effect; 

	
 

	
 

	
 

	
          (c)
 there have been no Releases of Hazardous Materials at, on, under or migrating
 from any property now or previously owned or leased by the Borrower, any
 Subsidiary or by the Greens Creek Joint Venture that have, or could
 reasonably be expected to have, a Material Adverse Effect; 

	
 

	
 

	
 

	
          (d)
 the Borrower and Subsidiaries and the Greens Creek Joint Venture have been
 issued and are in compliance with all Approvals relating to environmental
 matters other than any non-compliance which, individually or in the
 aggregate, could not reasonably be expected to have a Material Adverse
 Effect; 

	
 

	
 

	
 

	
          (e)
 no property now or previously owned or leased by the Borrower, any Subsidiary
 or by the Greens Creek Joint Venture is listed or proposed for listing on the
 National Priorities List pursuant to CERCLA, on the CERCLIS or on any similar
 state list of sites requiring investigation or clean-up; 

	
 

	
 

	
 

	
          (f)
 there are no underground storage tanks, active or abandoned, including
 petroleum storage tanks, on or under any property now or previously owned or
 leased by the Borrower, any Subsidiary or by the Greens Creek Joint Venture
 that, individually or in the aggregate, have, or could reasonably be expected
 to have, a Material Adverse Effect; 

	
 

	
 

	
 

	
          (g)
 the Borrower, its Subsidiaries and the Greens Creek Joint Venture have not
 transported, sent or arranged for the transportation or disposal of any
 Hazardous Material to any location which is listed or proposed for listing on
 the National Priorities List pursuant to CERCLA, on the CERCLIS or on any
 similar state list or which is the subject of federal, state or local
 enforcement actions or other investigations which may lead to material claims
 (including claims for remedial work, damage to natural resources or personal
 injury) against the Borrower, any such Subsidiary or the Greens Creek Joint
 Venture that, individually or in the aggregate, have, or could reasonably be
 expected to have, a Material Adverse Effect; 

	
 

	
 

	
 

	
          (h)
 there are no polychlorinated biphenyls or friable asbestos present at any
 property now or previously owned or leased by the Borrower, any Subsidiary or
 by the 

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Greens Creek
 Joint Venture that, individually or in the aggregate, have, or could
 reasonably be expected to have, a Material Adverse Effect; and

	
 

	
 

	
 

	
          (i)
 no other conditions exist at, on or under any property now or previously
 owned or leased by the Borrower, any Subsidiary or by the Greens Creek Joint
 Venture which, with the passage of time, or the giving of notice or both,
 would give rise to liability under any Environmental Law that, individually
 or in the aggregate, have, or could reasonably be expected to have, a
 Material Adverse Effect. 

          SECTION 6.13. Accuracy of Information. The factual
information heretofore or contemporaneously furnished in writing on or prior to
the date hereof made to any Secured Party by or on behalf of any Obligor or the
Greens Creek Joint Venture in connection with any Loan Document or any
transaction contemplated hereby when taken together with all reports,
statements, schedules and registration statements included in filings made by
the Borrower with the SEC prior to the delivery of such information to the
extent provided to the Secured Parties, does not contain any untrue statement
of a material fact and does not omit to state any material fact necessary to
make any such information not misleading under the circumstances in which made.

          SECTION 6.14. Regulations U and X. No Obligor is engaged
in the business of extending credit for the purpose of buying or carrying
margin stock, and no proceeds of the Credit Extension will be used to purchase
or carry margin stock or otherwise for a purpose which violates, or would be
inconsistent with, F.R.S. Board Regulation U or Regulation X. Terms for which
meanings are provided in F.R.S. Board Regulation U or Regulation X or any
regulations substituted therefor, as from time to time in effect, are used in
this Section with such meanings. 

          SECTION 6.15. Material Contracts. Item 6.15 of the
Disclosure Schedule sets forth a complete and accurate list of all Material
Contracts to which the Borrower and each Subsidiary is a party, showing as of
the Effective Date the parties to such Material Contracts, the dates such
Material Contracts were entered into, the subject matter of such Material
Contracts, the aggregate consideration payable to or by the parties thereto and
any other information useful to determine the materiality of such Material
Contract to the business or operations of the Borrower or the Subsidiary party
thereto. Neither the Borrower nor any Subsidiary is in default under or
relative to any Material Contracts that could reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect. 

          SECTION 6.16. Solvency. The Borrower and each other
Obligor, both before and after giving effect to the Credit Extension, are
Solvent. 

          SECTION 6.17. Insurance. Each of the Borrower and its
Material Subsidiaries maintains (i) insurance to such extent and against such
risks as is customary with Persons of comparable size engaged in the same or
similar business and similarly situated, (ii) worker’s compensation insurance
in the amount required by Applicable Law and (iii) such other insurance as may
be required by law. 

          SECTION 6.18. Condition of Business and Operations. Except
as set forth on Item 6.18 of the Disclosure Schedule, (i) neither the
business nor the operations of any Obligor or the 

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Greens Creek
Joint Venture has been disrupted by any casualty, act of God or any other
action, and (ii) no part of any mine, mill or tailings system owned or operated
by the Borrower or any of its Subsidiaries or the Greens Creek Joint Venture is
experiencing any failure, which disruption or failure could reasonably be
expected to have a Material Adverse Effect. 

          SECTION 6.19. Compliance with Law, etc. No Obligor is in
violation of its Organic Documents in any material respect. No Obligor is in
violation of any Applicable Law, which violation could reasonably be expected
to have, either individually or in the aggregate, a Material Adverse Effect. 

          SECTION 6.20. Mining Rights. Each of the Borrower and its
Subsidiaries has acquired all material Mining Rights which are required in
connection with the operation of its respective mines as they are operated as
of the date the representation is made, and has obtained such other surface and
other rights as are necessary for access rights, water rights, plant sites,
tailings disposal, waste dumps, ore dumps, abandoned heaps or ancillary
facilities which are required in connection with each mine. All such Mining
Rights and other rights are sufficient in scope and substance for the operation
of each mine owned or operated by Borrower or any of its Subsidiaries as each
such mine is operated as of each date this representation is made. 

          SECTION 6.21. Greens Creek Operations. The Greens Creek
Joint Venture Agreement is in full force and effect and no material default has
occurred and is continuing thereunder. Neither the transfer of the rights and
interests described in the Acquisition Agreement nor any similar transfer of
such rights and interests to the Secured Parties as a result of their exercise
of rights and remedies under the Loan Documents would prohibit or limit the
Greens Creek Joint Venture or the operation of the Greens Creek Mine under
Applicable Law or prevent Borrower or any Subsidiary thereof from obtaining,
amending, revising, renewing, or maintaining in good standing any permits or
approvals necessary to conduct operations at the Greens Creek Mine. 

          SECTION 6.22. Consummation of Acquisition; Representations and
Warranties from Acquisition Agreement. The Acquisition and related
transactions have been consummated substantially in accordance with the terms
of the Acquisition Agreement. As of the Effective Date, the Acquisition
Agreement has not been altered, amended or otherwise modified or supplemented
in any material respect or any material condition thereof waived without the
prior written consent of the Administrative Agent. Each of the representations
and warranties made in the Acquisition Agreement by the Borrower and its
Subsidiaries or, to the best knowledge of the Borrower, made by any third party
is true and correct, except for any representation or warranty therein the
failure of which to be true and correct, does not have or could not reasonably
be expected to have a Material Adverse Effect. 

ARTICLE VII

COVENANTS

          SECTION 7.1. Affirmative Covenants. The Borrower agrees
with each Lender and the Administrative Agent that, until the Termination Date
has occurred, the Borrower will, and will cause its Subsidiaries to, perform or
cause to be performed the obligations set forth below. 

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          SECTION 7.1.1. Financial Information, Reports, Notices, etc.
The Borrower will furnish each Lender and the Administrative Agent copies of
the following financial statements, reports, notices and information: 

	
 

	
 

	
 

	
          (a)
 as soon as available and in any event within 45 days after the end of each of
 the first three Fiscal Quarters of each Fiscal Year, an unaudited
 consolidated balance sheet of the Borrower and its Subsidiaries as of the end
 of such Fiscal Quarter and consolidated statements of income and cash flow of
 the Borrower and its Subsidiaries for such Fiscal Quarter and for the period
 commencing at the end of the previous Fiscal Year and ending with the end of
 such Fiscal Quarter, and including (in each case), in comparative form the
 figures for the corresponding Fiscal Quarter in, and year to date portion of,
 the immediately preceding Fiscal Year, certified as complete and correct by
 the chief financial or accounting Authorized Officer of the Borrower (subject
 to normal year end audit adjustments); 

	
 

	
 

	
 

	
          (b)
 as soon as available and in any event within 90 days after the end of each
 Fiscal Year, a copy of the consolidated balance sheet of the Borrower and its
 Subsidiaries, and the related consolidated statements of income and cash flow
 of the Borrower and its Subsidiaries for such Fiscal Year, setting forth in
 comparative form the figures for the immediately preceding Fiscal Year,
 audited (without any Impermissible Qualification) by independent public
 accountants acceptable to the Administrative Agent; 

	
 

	
 

	
 

	
          (c)
 concurrently with the delivery of the financial information pursuant to clauses
 (a) and (b), a Compliance Certificate, executed by the chief
 financial or accounting Authorized Officer of the Borrower, (i) showing
 compliance with the financial covenants set forth in Section 7.2.4,
 (ii) stating that no Default has occurred and is continuing (or, if a Default
 has occurred, specifying the details of such Default and the action that the
 Borrower or an Obligor has taken or proposes to take with respect thereto),
 (iii) designating one or more of the Borrower’s Subsidiaries as Material
 Subsidiaries if, in the absence of such designation, the aggregate assets or
 revenues of all Immaterial Subsidiaries of the Borrower would exceed the aggregate
 amounts set forth in clauses (iii) and (iv) of the first proviso to
 the definition of “Immaterial Subsidiary”, (iv) certifying that the
 Subsidiaries of the Borrower previously designated as Immaterial Subsidiaries
 remain Immaterial Subsidiaries as of the date thereof and (v) in the case of
 a Compliance Certificate delivered concurrently with the financial
 information pursuant to clause (b) (relative to the 2008 Fiscal Year
 and thereafter), the amount of Excess Cash Flow for such Fiscal Year
 (together with a detailed calculation thereof); 

	
 

	
 

	
 

	
          (d)
 as soon as possible and in any event within three days after the Borrower or
 any other Obligor obtains knowledge of the occurrence of a Default, a
 statement of an Authorized Officer of the Borrower setting forth details of
 such Default and the action which the Borrower or such Obligor has taken and
 proposes to take with respect thereto; 

	
 

	
 

	
 

	
          (e)
 at the time of each prepayment required under Section 3.1.1, (x) a certificate signed by an Authorized
 Officer of the Borrower setting forth in reasonable detail the 

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calculation
 of the amount of such prepayment and (y) to the extent practicable, at least
 three days’ prior written notice of such prepayment specifying the principal
 amount of Loans to be prepaid; 

	
 

	
 

	
 

	
          (f)
 as soon as possible and in any event within five days after the Borrower or
 any other Obligor obtains knowledge of (i) the occurrence of any material
 adverse development with respect to any litigation, action, proceeding or
 labor controversy described in Item 6.7 of the Disclosure Schedule
 which could reasonably be expected to have a material adverse effect on the
 outcome of such litigation, action, proceeding or labor controversy or (ii)
 the commencement of any litigation, action, proceeding or labor controversy
 of the type and materiality described in Section 6.7, notice thereof
 and, to the extent the Administrative Agent requests, copies of all
 documentation relating thereto; 

	
 

	
 

	
 

	
          (g)
 promptly after the sending or filing thereof, copies of all reports, notices,
 prospectuses and registration statements which any Obligor files with the SEC
 or any national securities exchange; 

	
 

	
 

	
 

	
          (h)
 promptly upon becoming aware of (i) the institution of any steps by any
 Person to terminate any Pension Plan, (ii) the failure to make a required
 contribution to any Pension Plan if such failure is sufficient to give rise
 to a Lien under Section 303(k) of ERISA, (iii) the taking of any action with
 respect to a Pension Plan which could result in the requirement that any
 Obligor furnish a bond or other security to the PBGC or such Pension Plan,
 (iv) a determination that a Pension Plan is, or is expected to be, in
 “at-risk” status (as defined in Section 303(i)(4)(A) of ERISA or Section
 430(i)(4)(A) of the Code), or a determination that a Multiemployer Plan is,
 or is expected to be, in endangered or critical status (as defined in Section
 305 of ERISA), or (v) the occurrence of any event with respect to any Pension
 Plan or Multiemployer Plan which could result in the incurrence by any
 Obligor of any material liability, fine or penalty, notice thereof and copies
 of all documentation relating thereto; 

	
 

	
 

	
 

	
          (i)
 promptly upon receipt thereof, copies of all “management letters” submitted
 to the Borrower or any other Obligor by the independent public accountants
 referred to in clause (b) in connection with each audit made by such
 accountants; 

	
 

	
 

	
 

	
          (j)
 promptly following the mailing or receipt of any notice or report delivered
 under the terms of any Subordinated Debt or any Designated Preferred Stock
 Documents, copies of such notice or report; 

	
 

	
 

	
 

	
          (k)
 promptly following receipt thereof by the Borrower, (i) a copy of the monthly
 progress reports on the operations of the Greens Creek Joint Venture and
 monthly supplemental financial data with respect to the Greens Creek Joint
 Venture, for the immediately preceding calendar month and (ii) a copy of the
 balance sheet and the related statements of income and cash flow of the
 Greens Creek Joint Venture for each fiscal year, setting forth in comparative
 form the figures for the immediately preceding fiscal year, audited (without
 any Impermissible Qualification) by independent public accountants acceptable
 to the Administrative Agent; 

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(l) as soon
 as available and, in any event, within

	
 

	
 

	
 

	
 

	
 

	
          (i)
 45 days after each of March 31, 2008 and June 30, 2008, notice of the
 applicable amounts referenced in clauses (a)(ii)(y), (a)(iii)(y),
 (b)(ii)(y) and (b)(iii)(y) of the definition of Plug Amount,
 which amounts shall be satisfactory to the Administrative Agent; 

	
 

	
 

	
 

	
 

	
 

	
          (ii)
 45 days after the end of each Fiscal Year, updated capital, operating and
 exploration budgets of the Borrower and its Material Subsidiaries, certified
 by an Authorized Officer of the Borrower; 

	
 

	
 

	
 

	
 

	
 

	
          (iii)
 90 days after the end of each Fiscal Year, an updated Hecla Mine Plan,
 certified by an Authorized Officer of the Borrower; and 

	
 

	
 

	
 

	
 

	
 

	
          (iv)
 90 days after the end of each Fiscal year, updated mineral reserve statements
 for Borrower and its Subsidiaries, certified by an Authorized Officer of the
 Borrower;

	
 

	
 

	
 

	
 

	
 

	
 

	
          (m)
 as soon as possible and in any event within three days after the Borrower or
 any other Obligor obtains knowledge of the commencement of any suit, action
 or proceeding arising under any Environmental Laws which could reasonably be
 expected to result in a Material Adverse Effect, or any other adverse claim
 asserted against any Obligor or with respect to its properties which could
 reasonably be expected to result in a Material Adverse Effect, notice thereof
 and copies of all documentation relating thereto;

	
 

	
 

	
 

	
          (n)
 promptly upon the occurrence of any material event relating to the Greens
 Creek Mine, including any unscheduled shutdowns of, or disruptions to, the
 mining operations of the Greens Creek Mine, notice thereof;

	
 

	
 

	
 

	
          (o)
promptly notify the Administrative Agent and provide copies upon receipt of
all written claims, complaints, notices or inquiries relating to, or as to
compliance with, laws relating to employee health and safety (including the
Occupational Safety and Health Act, 29 U.S.C.A. §651 et. seq. and the Federal
Mine Safety and Health Act, 30 U.S.C.A. §801 et. seq.), to the extent
conditions described in such claims, complaints, notices and inquiries could
reasonably be expected to result in a liability for the Borrower and its
Subsidiaries in an aggregate amount exceeding $1,000,000 and shall promptly
resolve any material non-compliance with such laws (except to the extent such
non-compliance is being diligently contested in good faith) and keep its
property free of any Lien imposed by such laws;  

	
 

	
 

	
 

	
          (p)
 as soon as available and in any event within 45 days after the end of each of
 the Fiscal Quarters of each Fiscal Year, reports with respect to all Hedging
 Agreements entered into by Borrower and its Subsidiaries as contemplated by
 this Agreement, which reports shall be in form and substance satisfactory to
 the Administrative Agent; and

	
 

	
 

	
 

	
          (q)
 such other financial and other information as any Secured Party may from time
 to time reasonably request (including information and reports in such detail
 as the

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Administrative
 Agent may request with respect to the terms of and information provided
 pursuant to the Compliance Certificate).

          SECTION 7.1.2. Maintenance of Existence; Compliance with
Contracts, Laws, etc. Subject to the provisions of this Agreement, the Borrower
will, and will cause each of its Material Subsidiaries to, preserve and
maintain its legal existence (except, in the case of Material Subsidiaries, as
otherwise permitted by Section 7.2.10), rights, privileges and
franchises, and to be duly qualified and in good standing in each jurisdiction
in which such Person owns properties or carries on business and in any other
jurisdiction in which such qualification is necessary or desirable in view of
its business and operations or the ownership of its properties, except where
the failure to be so qualified and in good standing could not reasonably be
expected to have, either individually, or in the aggregate, a Material Adverse
Effect. The Borrower will, and will cause each of its Subsidiaries to, comply in
all material respects with all Applicable Laws that are material to the
Borrower and its Subsidiaries and the Greens Creek Joint Venture, including the
payment (before the same become delinquent) of all Taxes imposed upon the
Borrower or its Subsidiaries or upon their property, except to the extent being
diligently contested in good faith by appropriate proceedings and for which
adequate reserves in accordance with GAAP have been set aside on the books of
the Borrower or its Subsidiaries, as applicable. 

          SECTION 7.1.3. Maintenance of Properties. The Borrower
will, and will cause each of its Material Subsidiaries to, maintain, preserve,
protect and keep 

	
 

	
 

	
 

	
 

	
 

	
          (i)
 its interests in its properties as necessary for it to be able to develop and
 operate its mines in accordance with normal industry practice; and 

	
 

	
 

	
 

	
 

	
 

	
          (ii)
 its properties in good repair, working order and condition (ordinary wear and
 tear and casualty and condemnation excepted), and make necessary repairs,
 renewals and replacements in accordance with normal industry practice so that
 the business carried on by it may be properly conducted at all times, unless
 the Borrower determines in good faith that the continued maintenance of any
 such property is no longer economically desirable, necessary or useful to the
 business of the Borrower or any Material Subsidiary or the Disposition of
 such property is otherwise permitted by Sections 7.2.9 or 7.2.10. 

          SECTION 7.1.4. Insurance. The Borrower will, and will
cause each Subsidiary to, maintain, (x) insurance on its property with
financially sound and reputable insurance companies against loss and damage in
at least the amounts (and with only those deductibles) customarily maintained,
and against such risks as are typically insured against in the same general
area, by Persons of comparable size engaged in the same or similar business as
the Borrower and its Subsidiaries and the Greens Creek Joint Venture and (y)
all worker’s compensation, employer’s liability insurance or similar insurance
as may be required under Applicable Law. Without limiting the foregoing, all
insurance policies required pursuant to this Section shall: 

	
 

	
 

	
 

	
          (a)
 name the Administrative Agent on behalf of the Secured Parties as loss payee
 (in the case of property insurance) or additional insured (in the case of
 liability insurance), as applicable, and provide that no cancellation or
 modification of the 

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policies
 will be made without 30 days’ prior written notice to the Administrative
 Agent; and

	
 

	
 

	
 

	
          (b)
 be in addition to any requirements to maintain specific types of insurance
 contained in the other Loan Documents.

          SECTION 7.1.5. Books and Records. The Borrower will, and
will cause each Subsidiary to, keep books and records in accordance with GAAP
which accurately reflect all of its business affairs and transactions. 

          SECTION 7.1.6. Visitation. 

	
 

	
 

	
 

	
          (a)
 The Borrower will, and will cause each Subsidiary to, permit each Secured
 Party or any of their respective representatives, at reasonable times and
 intervals upon reasonable notice to the Borrower, to visit each Obligor’s
 offices, to discuss such Obligor’s financial matters with its officers and
 employees, and its independent public accountants (and the Borrower hereby
 authorizes such independent public accountant to discuss each Obligor’s
 financial matters with each Secured Party or their representatives whether or
 not any representative of such Obligor is present) and to examine (and
 photocopy extracts from) any of its books and records. The Borrower shall pay
 any reasonable and out-of-pocket expenses incurred in connection with any
 Secured Party’s exercise of its rights pursuant to this Section (including
 fees of such independent public accountant); provided that, so long as
 no Default has occurred and is continuing, the Borrower shall only be
 required to pay such reasonable and out-of-pocket expenses incurred in
 connection with one such visit and/or discussion per Fiscal Year.

	
 

	
 

	
 

	
          (b)
 The Borrower will provide to the Administrative Agent written or verbal
 reports on the status of the litigation set forth in or referred to in Item
 6.7 of the Disclosure Schedule, at such times and intervals (but in any
 event no more than once a month, unless there has been a material adverse
 development with respect to the outcome of such litigation) as the
 Administrative Agent shall reasonably determine to assess the status and
 progress of such litigation, including a report on the issuance of significant
 rulings and the taking of important testimony. The Borrower will also cause
 the Borrower’s legal counsel in connection with such litigation to be
 available to discuss (provided the Borrower’s General Counsel or such
 counsel’s designee has been provided a reasonable opportunity to be present
 during such discussion) any such reports with the Administrative Agent at the
 reasonable request of the Administrative Agent (which requests shall not be
 more than once a month, unless there has been a material adverse development
 with respect to the outcome of such litigation); provided, however,
 that the terms of this clause (b) shall not be deemed to authorize or
 require any attorney to disclose information that, if disclosed pursuant to
 this clause (b), would, in such attorney’s written opinion, violate
 the attorney-client privilege between such attorney and the Borrower. The
 Borrower shall pay the fees of counsel incurred in connection with the
 Administrative Agent’s exercise of its rights pursuant to this Section.

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          SECTION 7.1.7. Environmental Law Covenant. The Borrower
will, and will cause each of its Subsidiaries to: 

	
 

	
 

	
 

	
          (a)
 use and operate all of its and their facilities and properties in compliance
 in all material respects with all Environmental Laws material to the Borrower
 and its Subsidiaries, keep all necessary Approvals relating to environmental
 matters material to the Borrower and its Subsidiaries in effect, and remain
 in material compliance therewith, and handle all Hazardous Materials in
 compliance in all material respects with all such Environmental Laws; and 

	
 

	
 

	
 

	
          (b)
 promptly notify the Administrative Agent and provide copies upon receipt of
 all written claims, complaints, notices or inquiries relating to the condition
 of its facilities and properties in respect of, or as to compliance with,
 Environmental Laws that, if adversely determined, individually or in the
 aggregate, could reasonably be expected to have a Material Adverse Effect,
 and shall keep its property free of any Lien imposed by any Environmental
 Law. 

          SECTION 7.1.8. Future Guarantors, Security, etc. The
Borrower will, upon any Person becoming either a direct or indirect Subsidiary,
or upon any U.S. Subsidiary satisfying the criteria of a Material Subsidiary or
any Foreign Subsidiary satisfying the criteria of a Pledged Foreign Subsidiary,
and with respect to any Pledged Foreign Subsidiary that exists on the Effective
Date that is not a party to a Pledge Agreement or a Foreign Pledge Agreement or
the Capital Securities of which have not been pledged under a Pledge Agreement
or a Foreign Pledge Agreement: 

	
 

	
 

	
 

	
          (a)
 cause any Greens Creek Participant, any assignee thereof or any other Person
 that holds any ownership interest of all or a portion of the assets of the
 Greens Creek Mine or the Greens Creek Joint Venture to execute and deliver to
 the Administrative Agent a supplement to the Security Agreement substantially
 in the form attached thereto as Annex I and cause any Person that is either a
 Material U.S. Subsidiary or a Pledged Foreign Subsidiary to execute and
 deliver to the Administrative Agent a supplement to the Subsidiary Guaranty
 substantially in the form attached thereto as Annex I, in each case for the
 benefit of the Secured Parties;

	
 

	
 

	
 

	
          (b)
 cause each Person holding Capital Securities in a Material U.S. Subsidiary or
 a Pledged Foreign Subsidiary to execute and deliver, or cause the Subsidiary
 that will own Capital Securities of such Person to execute and deliver, to the
 Administrative Agent a supplement to the Pledge Agreement, substantially in
 the form attached thereto as Annex I (and, if applicable, a Foreign Pledge
 Agreement) and shall, pursuant to the Pledge Agreement (and, if applicable, a
 Foreign Pledge Agreement), pledge and deliver to the Administrative Agent,
 for the benefit of the Secured Parties, all of the outstanding Capital
 Securities of each Material U.S. Subsidiary or Foreign Pledged Subsidiary
 owned by the Borrower or such Subsidiary and take all other action required
 under the Pledge Agreement (a Foreign Pledge Agreement as the case may be)
 together with (x) undated stock powers or equivalent instruments of transfer
 reasonably satisfactory to the Administrative Agent for such certificates or
 such other evidence of beneficial ownership, executed in blank (or, if any
 such Capital Securities are uncertificated,

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confirmation
 and evidence reasonably satisfactory to the Administrative Agent that the
 security interest in such uncertificated securities has been perfected in
 accordance with the UCC or any similar or local law which may be applicable)
 and (y) Filing Statements naming the Borrower or such Subsidiary as the
 debtor and the Administrative Agent as the secured party, suitable for filing
 under the UCC (or other Applicable Law) of all jurisdictions as may be
 necessary or, in the reasonable opinion of the Administrative Agent,
 desirable to perfect the security interest of the Administrative Agent in the
 interests of the Borrower or such Subsidiary in such Person pledged pursuant
 to the Pledge Agreement (and, if applicable, a Foreign Pledge Agreement); provided
 that, with respect to any Person holding Capital Securities in any Foreign
 Subsidiary that is a Pledged Foreign Subsidiary, such Person will have 120
 days (with respect to any such Subsidiary organized and existing under the
 laws of Mexico) or 180 days (with respect to any such Subsidiary organized
 and existing under the laws of Venezuela or the laws of the Netherlands) to
 use commercially reasonable efforts to comply with this clause (b) (or
 such longer time as the Administrative Agent permits in its sole discretion);

	
 

	
 

	
 

	
          (c)
 deliver to the Administrative Agent as to each such Person certified copies
 of UCC Requests for Information or Copies (Form UCC-11), or a similar search
 report certified by a party reasonably acceptable to the Administrative
 Agent, dated a date reasonably near (but prior to) the date of any such
 Person becoming a direct or indirect Subsidiary, listing all effective
 financing statements, tax liens and judgment liens which name such Person as
 the debtor and which are filed in the jurisdictions in which filings are to
 be made pursuant to this Agreement and the other Loan Documents, and in such
 other jurisdictions as the Administrative Agent may reasonably request,
 together with copies of such financing statements (none of which (other than
 financing statements (x) filed pursuant to the terms hereof in favor of the
 Administrative Agent, (y) being terminated pursuant to termination statements
 that are to be delivered on or prior to the date such Person becomes such
 Subsidiary or (z) in respect of Permitted Liens) shall cover any of the
 collateral described in any Loan Document);

	
 

	
 

	
 

	
          (d)
 deliver to the Administrative Agent as to each such Person joined to the
 Security Agreement, Filing Statements naming such Person as the debtor and
 the Administrative Agent as the secured party, for the benefit of the Secured
 Parties, suitable for filing under the UCC of all jurisdictions as may be
 necessary or, in the reasonable opinion of the Administrative Agent,
 desirable to perfect the security interest of the Administrative Agent
 pursuant to any security agreement entered into by such Person; and

	
 

	
 

	
 

	
          (e)
 subject to the provisions in clause (b) above, the Administrative
 Agent shall have received such customary opinions of legal counsel as the
 Administrative Agent may reasonably request, which legal opinions shall be in
 form and substance reasonably satisfactory to the Administrative Agent.

Notwithstanding
anything to the contrary in any Loan Document, (x) no more than 65% of the
Voting Securities of any Foreign Subsidiary shall be pledged as security for
the Obligations, (y) no Foreign Subsidiary shall be required to pledge as
security for the Obligations any of its assets and (z) no Foreign Subsidiary
shall be required to guarantee the Obligations either through a 

-64-

Subsidiary
Guaranty or otherwise, in the case of clauses (x), (y) or (z), if such pledge
or guaranty results in adverse tax consequences for the Borrower and its
Subsidiaries, taken as a whole.  

          SECTION 7.1.9. Further Assurances. Subject to Section
7.1.8, the Borrower will, and will cause each Subsidiary to, execute any
documents, Filing Statements, agreements and instruments, and take all further
action that may be required under Applicable Law, or that the Administrative
Agent may reasonably request, in order to effectuate the transactions
contemplated by the Loan Documents and in order to grant, preserve, protect and
perfect the validity and first priority of the Liens created or intended to be
created by the Loan Documents. Without limiting the generality of the
foregoing, the Borrower shall provide, upon the request of the Administrative
Agent, copies of all Approvals referred to in Section 6.3 and Section
6.20 and related information. 

          SECTION 7.1.10. Material Subsidiaries. In the event of a
transfer of assets from the Borrower or any of its Subsidiaries to an
Immaterial Subsidiary, the Borrower shall designate, in a notice to the
Lenders, (i) such Immaterial Subsidiary as a Material Subsidiary if such
Subsidiary would be a Material Subsidiary as of the last day of the Fiscal
Quarter during which such transfer occurs and (ii) one or more of its other
Subsidiaries as Material Subsidiaries if, in the absence of such designation,
the aggregate assets or revenues of all Immaterial Subsidiaries of the Borrower
would exceed the aggregate amounts set forth in clauses (iii) and (iv)
of the first proviso in the definition of “Immaterial Subsidiary”. 

          SECTION 7.1.11. Independent Corporate Existence. The
Borrower shall: 

	
 

	
 

	
 

	
 

	
          (a)
 cause each Material Subsidiary to comply with the terms of its limited
 liability company agreement, articles of incorporation, by-laws (as the case
 may be) and other Organic Documents; and 

	
 

	
 

	
 

	
          (b)
 without limiting the effect of the preceding clause (a), 

	
 

	
 

	
 

	
 

	
 

	
          (i)
 observe all organizational formalities, including holding appropriate
 meetings or actions by written consent, as required by all Applicable Law;

	
 

	
 

	
 

	
 

	
 

	
          (ii)
 cause each Material Subsidiary to maintain an arm’s-length relationship with
 its Affiliates and not hold itself out as being liable for the debts of any
 of its Affiliates (other than with respect to obligations expressly permitted
 hereunder); and

	
 

	
 

	
 

	
 

	
 

	
          (iii)
 cause each Material Subsidiary (A) to keep its assets and its liabilities
 wholly separate from those of all other entities, including, but not limited
 to its Affiliates, and (B) to maintain its assets and liabilities in such a
 manner that it is not materially costly or difficult to segregate, ascertain
 or otherwise identify the Subsidiary’s individual assets and liabilities from
 those of any other Person.

All
consolidated financial statements of the Borrower furnished by the Borrower or
any of its Subsidiaries shall clearly indicate that all of the interests in the
Greens Creek Joint Venture held by the Greens Creek Participants are held
separate and apart from the assets of the Borrower and the Subsidiaries of the
Borrower other than the Greens Creek Participants. 

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          SECTION 7.1.12. Hedging. The Borrower will, within 30 days
following the Effective Date, enter into and maintain one or more Hedging
Agreements designed to protect the Borrower against fluctuations in interest
rates relative to at least the Term I Loan Commitment Amount for the period
during which such Loans remain outstanding, on terms reasonably satisfactory to
the Administrative Agent and with a counterparty that is a Lender, the
Administrative Agent or an Affiliate of a Lender or the Administrative Agent,
or a financial institution which has a credit rating of A2 or higher from
Moody’s, A or higher from S&P or A or higher from Fitch and that has a
combined capital and surplus of no less than $250,000,000. 

          SECTION 7.1.13. Maintenance of Mining Rights. The Borrower
shall maintain all material Mining Rights which are required in connection with
the operation of its mines as they are then operated, and will obtain such
other surface and other rights as are necessary for access rights, water
rights, plant sites, tailings disposal, waste dumps, ore dumps, abandoned heaps
or ancillary facilities which are required in connection with each mine. All
such Mining Rights and other rights will be sufficient in scope and substance
for the operation of each mine then owned or operated by Borrower or any of its
Subsidiaries as they are then operated. 

          SECTION 7.1.14. Issuance of Subordinated Debt; Status of
Obligations as Senior Indebtedness, etc. To the extent the Borrower issues
any Subordinated Debt, the Borrower shall have the power and authority to incur
such Subordinated Debt as provided for under the Subordinated Debt Documents
applicable thereto and shall have duly authorized, executed and delivered the
Subordinated Debt Documents applicable to such Subordinated Debt. To the extent
the Borrower issues any Subordinated Debt, the Borrower shall issue, pursuant
to due authorization, such Subordinated Debt under the applicable Subordinated
Debt Documents, and such Subordinated Debt Documents shall constitute the
legal, valid and binding obligations of the Borrower enforceable against the
Borrower in accordance with its terms (except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization or similar laws
affecting creditors’ rights generally and by principles of equity). The
subordination provisions of all such Subordinated Debt contained in the related
Subordinated Debt Documents shall be enforceable against the holders of the
Subordinated Debt by the holder of any “Senior Indebtedness” or similar term
referring to the Obligations (as defined in such Subordinated Debt Documents).
To the extent any Designated Preferred Stock is issued and outstanding, such
Designated Preferred Stock shall contain provisions which prohibit the
declaration, payment or setting aside of funds for payment of dividends on such
Designated Preferred Stock following the occurrence and during the continuance
of a Default and the holder of any Senior Indebtedness or similar term
referring to the Obligations (as defined in the applicable Designated Preferred
Stock Documents) shall be a third party beneficiary of such provisions. All
Obligations, including those to pay principal of and interest (including
post-petition interest, whether or not allowed as a claim under bankruptcy or
similar laws) on the Loans and fees and expenses in connection therewith,
constitute “Senior Indebtedness” or similar term in the Subordinated Debt
Documents relating to the Obligations, and all such Obligations are entitled to
the subordination provisions of the Subordinated Debt Documents. 

          SECTION 7.2. Negative Covenants. The Borrower covenants
and agrees with each Lender and the Administrative Agent that until the
Termination Date has occurred, the Borrower will, and will cause its
Subsidiaries to, perform or cause to be performed the obligations set forth
below. 

-66-

          SECTION 7.2.1. Business Activities. The Borrower will not,
and will not permit any of its Subsidiaries to, (a) engage in any business
activity except those business activities engaged in on the date of this
Agreement and activities reasonably incidental thereto, or (b) without limiting
the effect of any provision contained herein, in the case of the Borrower,
transfer any assets to a Subsidiary, other than (i) pursuant to Section
7.2.10 or (ii) cash pursuant to a loan, advance or other Investment
permitted pursuant to clauses (e), and (f) of Section 7.2.2,
clauses (e), (f), (h), (i) and (k) of Section
7.2.5 or Section 7.2.9. 

          SECTION 7.2.2. Indebtedness. The Borrower will not, and
will not permit any of its Subsidiaries to, create, incur, assume or permit to
exist any Indebtedness, other than: 

	
 

	
 

	
 

	
          (a)
 Indebtedness in respect of the Obligations; 

	
 

	
 

	
 

	
          (b)
 Indebtedness existing as of the Effective Date which is identified in Item
 7.2.2(b) of the Disclosure Schedule, and any Refinancing of such
 Indebtedness; 

	
 

	
 

	
 

	
          (c)
 unsecured and secured (to the extent permitted under clause (c) of Section
 7.2.3) Indebtedness in respect of performance bonds and reclamation bonds
 and cash deposits provided in the ordinary course of business; provided
 that (i) the amount of such Indebtedness outstanding with respect to the
 Greens Creek Mine shall not exceed at any time $55,000,000, (ii) the
 aggregate amount of all such Indebtedness outstanding pursuant to this clause
 (c) shall not at any time exceed $100,000,000, (iii) with respect to the
 Greens Creek Mine and Lucky Friday Mine, Indebtedness under this clause
 shall only be permitted to the extent (A) required by a Governmental
 Authority or a recognized Indian tribe with applicable jurisdiction and
 authority and (B) the Borrower shall have provided to the Administrative
 Agent a written copy of each order or agreement imposing or increasing (or
 any other requirements in respect of) the amount of any such obligation after
 the Effective Date; 

	
 

	
 

	
 

	
          (d)
 Indebtedness evidencing the deferred purchase price of newly acquired
 property or incurred to finance the acquisition of equipment of the Borrower
 and its Subsidiaries (pursuant to purchase money mortgages or otherwise, whether
 owed to the seller or a third party) used in the ordinary course of business
 of the Borrower and its Subsidiaries (provided that, such Indebtedness
 is incurred within 90 days of the acquisition of such property) and in
 respect of Capitalized Lease Liabilities; provided that, the aggregate
 amount of all Indebtedness outstanding pursuant to this clause (d) and
 clause (i) below shall not at any time exceed $35,000,000; 

	
 

	
 

	
 

	
          (e)
 Indebtedness of any Subsidiary owing to the Borrower or any other Subsidiary
 (but only a Subsidiary Guarantor if the Subsidiary owing such Indebtedness is
 a Subsidiary Guarantor); 

	
 

	
 

	
 

	
          (f)
 unsecured Indebtedness of the Borrower or a Subsidiary Guarantor owing to a
 Subsidiary that has previously executed and delivered to the Administrative
 Agent the Interco Subordination Agreement (provided that, no payment
 of principal or interest shall be made in respect of such Indebtedness if a
 Default or Event of Default has occurred and is then continuing or would
 result therefrom); 

-67-

	
 

	
 

	
 

	
          (g)
 unsecured Subordinated Debt and/or Designated Preferred Stock of the Borrower
 incurred pursuant to the terms of the Subordinated Debt Documents or
 Designated Preferred Stock Documents, as applicable, and Refinancings (which
 continue to satisfy the terms of the definition of “Subordinated Debt”); provided
 that the Administrative Agent shall have received prior to the incurrence
 thereof a Compliance Certificate for the period of four full Fiscal Quarters
 immediately preceding such incurrence (prepared in good faith and in a manner
 and using such methodology which is consistent with the most recent financial
 statements delivered pursuant to Section 7.1.1) giving pro forma
 effect to such incurrence and evidencing compliance with the covenants set
 forth in Section 7.2.4; and provided further that all
 Contingent Liabilities of the Obligors in respect of such Subordinated Debt
 shall be subordinated to the Obligations on substantially the same terms as
 the Subordinated Debt of the Borrower is subordinated to the Obligations. 

	
 

	
 

	
 

	
          (h)
 Indebtedness of a Subsidiary (including a Subsidiary acquired pursuant to a
 Permitted Acquisition) of the Borrower that is not a Subsidiary Guarantor; provided
 that no Obligor is providing any credit support for, or a guarantee of, any
 such Indebtedness, and such Indebtedness is for all purposes non-recourse to
 the Obligors and their respective assets; 

	
 

	
 

	
 

	
          (i)
 unsecured Indebtedness of the Borrower; provided that, the aggregate amount of all
 Indebtedness outstanding pursuant to this clause (i) and clause (d)
 above shall not at any time exceed $35,000,000; 

	
 

	
 

	
 

	
          (j)
 Indebtedness consisting of Earn-out Obligations; provided that such
 Earn-out Obligations are unsecured; and 

	
 

	
 

	
 

	
          (k)
 Hedging Obligations under Hedging Agreements permitted under Section
 7.2.14.

provided that no Indebtedness otherwise
permitted by clauses (e), (g), (h), or (i) shall be
assumed, created or otherwise incurred if a Default has occurred and is then
continuing or would result therefrom. 

          SECTION 7.2.3. Liens. The Borrower will not, and will not
permit any of its Subsidiaries to, create, incur, assume or permit to exist any
Lien upon any of its property (including Capital Securities of any Person),
revenues or assets, whether now owned or hereafter acquired, except: 

	
 

	
 

	
 

	
          (a)
 Liens securing payment of the Obligations; 

	
 

	
 

	
 

	
          (b)
 Liens existing as of the Effective Date and disclosed in Item 7.2.3(b)
 of the Disclosure Schedule securing Indebtedness described in clause (b)
 of Section 7.2.2, and Refinancings of such Indebtedness; provided,
 no such Lien shall encumber any additional property and the amount of
 Indebtedness secured by such Lien is not increased from that existing on the
 Effective Date (as such Indebtedness may have been permanently reduced
 subsequent to the Effective Date); 

-68-

	
 

	
 

	
 

	
          (c)
Liens on cash and Cash Equivalent Investments securing Indebtedness of the
type permitted under clause (c) of Section 7.2.2;  

	
 

	
 

	
 

	
          (d)
 Liens securing Indebtedness of the type permitted under clause (d) of Section
 7.2.2; provided that, (i) such Lien is granted within 90 days
 after such Indebtedness is incurred, (ii) the Indebtedness secured thereby does
 not exceed the fair market value of the applicable property, improvements or
 equipment at the time of such acquisition (or construction) and (iii) such
 Lien secures only the assets that are the subject of the Indebtedness
 referred to in such clause; 

	
 

	
 

	
 

	
          (e)
 Liens securing Indebtedness permitted by clause (h) of Section
 7.2.2; provided, however, that such Liens existed prior to
 such Person becoming a Subsidiary and were not created in anticipation
 thereof; 

	
 

	
 

	
 

	
          (f)
 Liens in favor of carriers, warehousemen, mechanics, materialmen and
 landlords granted in the ordinary course of business for amounts not overdue
 or being diligently contested in good faith by appropriate proceedings and
 for which adequate reserves in accordance with GAAP shall have been set aside
 on its books; 

	
 

	
 

	
 

	
          (g)
 Liens incurred or deposits made in the ordinary course of business (i) in
 connection with worker’s compensation, unemployment insurance or other forms
 of governmental insurance or benefits (other than, for the avoidance of
 doubt, Liens in favor of the PBGC), or (ii) to secure performance of tenders,
 statutory obligations, bids, leases or other similar obligations (other than
 for borrowed money) entered into in the ordinary course of business or to secure
 obligations on performance bonds; 

	
 

	
 

	
 

	
          (h)
 judgment Liens of $1,000,000 or less, provided that the aggregate amount of
 such judgment Liens does not exceed $5,000,000 and (ii) other judgment Liens
 in existence for less than 30 days after the entry thereof or with respect to
 which execution has been stayed or the payment of which is covered in full
 (subject to a customary deductible) by insurance maintained with responsible
 insurance companies which have acknowledged their responsibility to cover
 such judgment and which do not otherwise result in an Event of Default under Section
 8.1.6; 

	
 

	
 

	
 

	
          (i)
 easements, rights-of-way, zoning restrictions, minor defects or
 irregularities in title and other similar encumbrances not interfering in any
 material respect with the value or use of the property to which such Lien is
 attached; 

	
 

	
 

	
 

	
          (j)
 Liens for Taxes not at the time delinquent or thereafter payable without
 penalty or being diligently contested in good faith by appropriate proceedings
 and for which adequate reserves in accordance with GAAP shall have been set
 aside on its books; and 

	
 

	
 

	
 

	
          (k)
 Liens on assets located outside the United States to secure statutory
 obligations under the laws of foreign jurisdictions. 

          SECTION 7.2.4. Financial Condition and Operations. The
Borrower will not permit any of the events set forth below to occur: 

-69-

	
 

	
 

	
 

	
          (a)
Net Worth to be less than 75% of the Borrower’s pro forma Net Worth
calculated as of the Effective Date (it being agreed that the Borrower’s pro
forma Net Worth calculated as of the Effective Date is $530,466,000);  

	
 

	
 

	
 

	
          (b)
 the Leverage Ratio to be greater than 3.00 to 1.00;

	
 

	
 

	
 

	
          (c)
 the Interest Coverage Ratio to be less than 3.00 to 1.00; and

	
 

	
 

	
 

	
          (d)
 the Current Ratio to be less than 1.10 to 1.00. 

          SECTION 7.2.5. Investments. The Borrower will not, and
will not permit any of its Subsidiaries to, purchase, make, incur, assume or
permit to exist any Investment in any other Person or enter into any joint
venture with any other Person or Persons, except: 

	
 

	
 

	
 

	
          (a)
 Investments existing on the Effective Date and identified in Item 7.2.5(a)
 of the Disclosure Schedule and Investments constituting the Acquisition; 

	
 

	
 

	
 

	
          (b)
 Cash Equivalent Investments; 

	
 

	
 

	
 

	
          (c)
 Investments received in connection with the bankruptcy or reorganization of,
 or settlement of delinquent accounts and disputes with, customers and
 suppliers, in each case in the ordinary course of business; 

	
 

	
 

	
 

	
          (d)
 Investments constituting Capital Expenditures; 

	
 

	
 

	
 

	
          (e)
 Investments permitted by (i) clause (e) or (ii) clause (f) of Section
 7.2.2; 

	
 

	
 

	
 

	
          (f)
 Investments by way of contributions to capital or purchases of Capital
 Securities (i) by the Borrower in any Subsidiaries or by any Subsidiary in
 other Subsidiaries or (ii) by any Subsidiary in the Borrower; 

	
 

	
 

	
 

	
          (g)
 Investments constituting (i) accounts receivable arising, (ii) trade debt granted,
 or (iii) deposits made in connection with the purchase price of goods or
 services, in each case in the ordinary course of business; 

	
 

	
 

	
 

	
          (h)
 Investments constituting Permitted Acquisitions, the San Juan Silver Mining
 Joint Venture and the Independence Lead Mine Acquisition; 

	
 

	
 

	
 

	
          (i)
 Investments constituting the incurrence of development costs and the entry
 into options and leases to mine real property to the extent incurred or
 entered into in the ordinary course of business consistent with past
 practice; 

	
 

	
 

	
 

	
          (j)
Investments consisting of any deferred portion of the sales price received by
the Borrower or any Subsidiary in connection with any Disposition permitted
under Section 7.2.10;  

-70-

	
 

	
 

	
 

	
          (k)
 to the extent permitted under Applicable Law, advances or loans to employees,
 directors or officers not to exceed $2,000,000 in the aggregate at any time
 outstanding; and 

	
 

	
 

	
 

	
          (l)
 other Investments in an aggregate amount not to exceed $30,000,000 at any
 time; 

provided that in respect of this Section
7.2.5, 

	
 

	
 

	
 

	
          (i)
 any Investment which when made complies with the requirements of the
 definition of the term “Cash Equivalent Investment” may continue to be held
 notwithstanding that such Investment if made thereafter would not comply with
 such requirements; 

	
 

	
 

	
 

	
          (ii)
 all Investments in all Subsidiaries shall have been pledged to the
 Administrative Agent (for the benefit of the Secured Parties) in accordance
 with the terms of the Loan Documents; 

	
 

	
 

	
 

	
          (iii)
 with respect to any date of determination, the aggregate amount of cash
 consideration (excluding any such consideration financed with Indebtedness of
 the type permitted under clause (d) of Section 7.2.2) for
 Investments otherwise permitted by clause (d) (other than with respect
 to the San Juan Silver Mining Joint Venture in an aggregate amount of up to
 $12,000,000, the Greens Creek Mine, the Lucky Friday Mine, the Isidora Mine
 or the La Comorra Mine), (e)(i), (f)(i), (h), (i),
 (j) and (l), above shall not exceed the then amount of Retained
 Proceeds; and 

	
 

	
 

	
 

	
          (iv)
 no Investment otherwise permitted by clause (d) (other than with
 respect to the San Juan Silver Mining Joint Venture in an aggregate amount of
 up to $12,000,000, the Greens Creek Mine, the Lucky Friday Mine, the Isidora
 Mine or the La Comorra Mine), (e)(i), (f)(i), (h), (i),
 (j), (k) or (l) above shall be permitted to be made if
 any Default has occurred and is continuing or would result therefrom. 

          SECTION 7.2.6. Restricted Payments, etc. The Borrower will
not, and will not permit any of its Subsidiaries to, declare or make a
Restricted Payment, or make any deposit for any Restricted Payment, other than 

	
 

	
 

	
 

	
          (a)
 (i) Restricted Payments made by wholly-owned Subsidiaries to the Borrower or
 wholly-owned Subsidiaries and (ii) Restricted Payments made by
 non-wholly-owned Subsidiaries to its shareholders or members generally so
 long as the Borrower or its Subsidiary which owns the equity interest in the
 Subsidiary making such Restricted Payment receives at least its proportionate
 share thereof (based upon its relative holding of the equity interests in the
 Subsidiary making such Restricted Payment);

	
 

	
 

	
 

	
          (b)
 the declaration or payment by the Borrower of a cash dividend on, or on
 account of, any class of Capital Securities of the Borrower (including
 Designated Preferred Stock); provided that prior to such declaration
 or payment, an Authorized

-71-

	
 

	
 

	
 

	
Officer of
 the Borrower shall have certified in writing to the Administrative Agent that
 no Default shall have occurred and be continuing or would result therefrom;

	
 

	
 

	
 

	
          (c)
 the payment of any dividends the declaration of which was permitted pursuant
 to the immediately preceding clause (b), so long as such payment is
 made within 60 days of such declaration or on its regularly schedule payment
 date;

	
 

	
 

	
 

	
          (d)
 the redemption, purchase or other acquisition by the Borrower of its Series B
 Preferred Stock and, concurrent
 with any such redemption, the payment of accrued dividends thereon; provided that prior to such
 redemption, purchase or other acquisition or payment of accrued dividends, an
 Authorized Officer of the Borrower shall have certified in writing to the
 Administrative Agent that no Default shall have occurred and be continuing or
 would result therefrom;

	
 

	
 

	
 

	
          (e)
 the redemption, purchase or other acquisition of Capital Securities of the
 Borrower in exchange for, or with the net cash proceeds of, the substantially
 concurrent sale (other than to a Subsidiary of the Borrower) of Capital
 Securities (other than Redeemable Capital Securities and Designated Preferred
 Stock) of the Borrower; provided that prior to such redemption,
 purchase or other acquisition, an Authorized Officer of the Borrower shall
 have certified in writing to the Administrative Agent that immediately before
 and after giving effect to such redemption, purchase or other acquisition no
 Default shall have occurred and be continuing or would result therefrom; and

	
 

	
 

	
 

	
          (f)
 the redemption, purchase or other acquisition of Capital Securities pursuant
 to the Small Lot Repurchase Program; provided that prior to such
 redemption, purchase or other acquisition, an Authorized Officer of the
 Borrower shall have certified in writing to the Administrative Agent that
 immediately before and after giving effect to such redemption, purchase or
 other acquisition no Default shall have occurred and be continuing or would
 result therefrom.

	
 

	
 

	
          SECTION 7.2.7. No Prepayment of Certain Indebtedness.
 The Borrower will not, and will not permit any of its Subsidiaries to,

	
 

	
 

	
 

	
          (a)
 make any payment or prepayment of principal of, or premium or interest on,
 any Subordinated Debt (i) other than the stated, scheduled date for payment
 of interest set forth in the applicable Subordinated Debt Documents or the
 conversion of such Subordinated Debt to Capital Securities pursuant to its
 terms, or (ii) which would violate the terms of this Agreement or the applicable
 Subordinated Debt Documents;

	
 

	
 

	
 

	
          (b)
 make any payment with respect to an Earn-out Obligation, other than on (or
 after) the stated, scheduled date therefor set forth in the documents
 evidencing such Earn-out Obligation and so long as (i) the maximum portion of
 such payment that can be satisfied with the payment of Capital Securities
 (other than Redeemable Capital Securities) of the Borrower shall be so
 satisfied and (ii) with respect to any such payment (or portion thereof) that
 cannot be so satisfied, (A) such payment is made following the receipt by the
 Administrative Agent of the financial statements described

-72-

	
 

	
 

	
 

	
in clause
 (b) of Section 7.1.1 (and the Compliance Certificate relating
 thereto) with respect to the Fiscal Year immediately preceding the Fiscal
 Year in which such payment is to be made, and (B) prior to such payment, an
 Authorized Officer of the Borrower shall have certified in writing to the
 Administrative Agent that no Default shall have occurred and be continuing or
 would result therefrom; or

	
 

	
 

	
 

	
          (c)
 make any deposit (including the payment of amounts into a sinking fund or
 other similar fund) for any of the foregoing purposes;

provided that the Borrower and its
Subsidiaries may pay or prepay the principal of, or premium or interest on, any
Subordinated Debt, or redeem, retire, purchase, defease or otherwise acquire
such Indebtedness, in exchange for, or with the net cash proceeds of, (x)
Indebtedness incurred pursuant to a Refinancing of such Indebtedness or (y) the
substantially concurrent sale (other than to a Subsidiary of the Borrower) of
Capital Securities (other than Redeemable Capital Securities and Designated
Preferred Stock) of the Borrower, so long as immediately before and after
giving effect to such payment, prepayment, redemption, retirement, purchase,
defeasance or other acquisition no Default shall have occurred and be
continuing or would result therefrom. 

          SECTION 7.2.8. Issuance of Capital Securities. The
Borrower will not, and will not permit any of its Material Subsidiaries to,
issue any Capital Securities (whether for value or otherwise) to any Person
other than (a) in the case of Material Subsidiaries (other than the Greens
Creek Group), Capital Securities (other than Redeemable Capital Securities,
unless otherwise permitted by Section 7.2.2) issued to the Borrower or a
Subsidiary Guarantor, (b) in the case of members of the Greens Creek Group, to
any Person that held Capital Securities of a Person in the Greens Creek Group
on the Effective Date or (c) in the case of the Borrower, Capital Securities
(other than Redeemable Capital Securities, unless otherwise permitted by Section
7.2.2) issued to any Person that does not result in a Change in Control. 

          SECTION 7.2.9. Consolidation, Merger, etc. The Borrower
will not, and will not permit any Subsidiary to, merge, dissolve, liquidate,
consolidate with or into another Person, except that, so long as no Default
exists or would result therefrom (a) any Subsidiary (other than the Subsidiary
Guarantors, but including each Subsidiary listed on Item 7.2.9 of the
Disclosure Schedule as of the Effective Date to the extent each such Subsidiary
is not a Material Subsidiary at such time) may liquidate, dissolve, or dissolve
voluntarily into, and may merge with and into, the Borrower or any other U.S.
Subsidiary (other than the Greens Creek Participants), (b) any Subsidiary
holding Unrestricted Disposition assets may liquidate and dissolve subsequent
to the Disposition of all such assets, (c) any Foreign Subsidiary (including
each Subsidiary listed on Item 7.2.9 of the Disclosure Schedule as of
the Effective Date to the extent each such Subsidiary is not a Material
Subsidiary at such time) may liquidate, dissolve, or dissolve voluntarily into,
and may merge with or into, any other Subsidiary (other than the Greens Creek
Participants), (d) any Subsidiary Guarantor (other than the Greens Creek
Participants) may merge with and into the Borrower or any other Subsidiary
Guarantor and (e) the assets or Capital Securities of any Subsidiary (other
than the Subsidiary Guarantors) may be purchased or otherwise acquired by the
Borrower or any other Subsidiary (other than the Greens Creek Participants) and
the Capital Securities or assets of any Subsidiary Guarantor (other than the
Greens Creek Participants) may be purchased or otherwise acquired by the
Borrower or any other Subsidiary Guarantor; provided that (A) no Default
has occurred and is continuing or would occur after giving effect thereto, (B) 

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such
transaction will not affect the Borrower’s ability to repay the Loans and
interest thereon when due, (C) such transaction will not affect the security
interest granted under the Loan Documents in favor of the Secured Parties and
(D) following such transaction, the Borrower will promptly deliver to the
Administrative Agent an update of Item 6.8 of the Disclosure Schedule
reflecting the new corporate structure of the Borrower and its Subsidiaries. 

          SECTION 7.2.10. Permitted Dispositions. The Borrower will
not, and will not permit any of its Subsidiaries to, Dispose of any of the
Borrower’s or such Subsidiaries’ assets to any Person in one transaction or
series of transactions unless such Disposition is (a) inventory or obsolete,
damaged, worn out or surplus property Disposed of in the ordinary course of its
business, (b) pursuant to Section 7.2.17, (c) permitted by clauses
(f) and (h) (but only with respect to the San Juan Silver Mining
Joint Venture) of Section 7.2.5 or Section 7.2.9, (d) publicly-traded
securities Disposed for fair market value or (e) (i) such Disposition is for
fair market value, (ii) the Net Disposition Proceeds received from such
Disposition, together with the Net Disposition Proceeds of all other assets
Disposed of pursuant to this clause does not exceed (individually, in the
aggregate or when aggregated with all Dispositions described in Section
7.2.17) $10,000,000 (excluding for purposes of such calculation, Net
Disposition Proceeds received from Unrestricted Dispositions) per year and
(iii) the Net Disposition Proceeds from such Dispositions are applied in
accordance with Sections 3.1.1 and 3.1.2; provided, however,
that, neither the Borrower nor any Subsidiary may Dispose of its interests in
(x) the Greens Creek Joint Venture Agreement, (y) the assets of any of the
Greens Creek Joint Venture, the Greens Creek Mine or the Lucky Friday Mine
(including its rights to receive income, distributions, products or proceeds
therefrom) except with respect to inventory and obsolete, damaged, immaterial,
worn out or surplus property Disposed of in the ordinary course of business or
(z) any member of the Greens Creek Group or Hecla Limited. This Section does
not permit the Disposition of less than 100% of any Capital Securities of the Borrower
or any Subsidiary to any Person, other than in the case of Subsidiaries, to the
Borrower or another Subsidiary, as otherwise permitted under Section 7.2.9.

          SECTION 7.2.11. Modification of Certain Agreements. The
Borrower will not, and will not permit any of its Subsidiaries to, consent to
any amendment, supplement, waiver or other modification of, or enter into any
forbearance from exercising any rights with respect to the terms or provisions
contained in, 

	
 

	
 

	
 

	
          (a)
 the Subordinated Debt Documents, other than any amendment, supplement, waiver
 or modification for which no fee is payable to the holders of the
 Subordinated Debt and which (i) extends the date or reduces the amount of any
 required repayment, prepayment or redemption of the principal of such
 Subordinated Debt, (ii) reduces the rate or extends the date for payment of
 the interest, premium (if any) or fees payable on such Subordinated Debt or
 (iii) makes the covenants, events of default or remedies in such Subordinated
 Debt Documents less restrictive on the Borrower and its Subsidiaries; 

	
 

	
 

	
 

	
          (b)
 the Designated Preferred Stock Documents, other than any amendment,
 supplement, waiver or modification for which no fee is payable to the holders
 of the Designated Preferred Stock and which (i) extends the date or reduces
 the amount of any required redemption of such Designated Preferred Stock,
 (ii) reduces the rate or extends 

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the date for
 payment of dividends, premium (if any) or fees payable on such Designated
 Preferred Stock or (iii) makes the covenants, redemption provisions or
 remedies in such Designated Preferred Stock Documents less restrictive on the
 Borrower;

	
 

	
 

	
 

	
          (c)
 any documents with respect to Earn-out Obligations, which (i) accelerates the
 date or increases the amount of any required payment of such Earn-out
 Obligation, (ii) modifies any of the subordination terms thereof or (iii)
 makes the covenants, events of default or remedies in such documents with
 respect to Earn-out Obligations more onerous on the obligors thereunder;

	
 

	
 

	
 

	
          (d)
 the Organic Documents of (i) any Obligor, if the result thereof could
 reasonably be expected to have an adverse effect on the ability of such
 Obligor to, and (ii) any Material Subsidiary of the Borrower (other than the
 Subsidiary Guarantor), if the result thereof could reasonably be expected to
 have a Material Adverse Effect on the ability of such Subsidiary to, in each
 case, comply with or satisfy its obligations hereunder or on the rights or
 remedies of any Secured Party; or

	
 

	
 

	
 

	
          (e)
 any other Transaction Documents in any other manner adverse to the rights or
 remedies of any Lender.

          SECTION 7.2.12. Transactions with Affiliates. The Borrower
will not, and will not permit any of its Subsidiaries to, enter into or cause
or permit to exist any arrangement, transaction or contract (including for the
purchase, sale, lease or exchange of property or the rendering of services)
with any of its other Affiliates, unless such arrangement, transaction or
contract is on fair and reasonable terms no less favorable to the Borrower or
such Subsidiary than it could obtain in an arm’s-length transaction with a
Person that is not an Affiliate; provided that the Borrower and
Subsidiary Guarantors may enter into any arrangement, transaction or contract
with any of the Borrower or other Subsidiary Guarantors that is not prohibited
by this Agreement and the Greens Creek Participants may be party to the Greens
Creek Joint Venture Agreement. 

          SECTION 7.2.13. Restrictive Agreements, etc. The Borrower
will not, and will not permit any of its Subsidiaries to, enter into any
agreement prohibiting: 

	
 

	
 

	
 

	
          (a)
 the creation or assumption of any Lien securing the Obligations upon its
 properties, revenues or assets, whether now owned or hereafter acquired; 

	
 

	
 

	
 

	
          (b)
 the ability of any Obligor to amend or otherwise modify any Loan Document; or
 

	
 

	
 

	
 

	
          (c)
 the ability of any Subsidiary to make any payments, directly or indirectly,
 to the Borrower, including by way of dividends, advances, repayments of
 loans, reimbursements of management and other intercompany charges, expenses
 and accruals or other returns on investments. 

The foregoing
prohibitions shall not apply to restrictions contained (i) in any Loan
Document, (ii) in the case of clause (a), any agreement governing (A)
any secured Indebtedness permitted by clause (c) of Section 7.2.2
as to the cash and Cash Equivalent Investments securing such Indebtedness, (B)
any Indebtedness permitted by clause (d) of Section 7.2.2 as to
the assets 

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financed with
the proceeds of such Indebtedness, (iii) in the case of clauses (a) and (c),
any agreement of a Subsidiary governing Indebtedness permitted by Section
7.2.2 (provided that such restrictions are ordinary and customary with
respect to the type of Indebtedness being incurred and would not reasonably be
expected to adversely affect the Borrower’s ability to make payments
hereunder). 

          SECTION 7.2.14. Hedging Agreements. The Borrower will not
(a) permit any Subsidiary to enter into any Hedging Agreement or incur or
suffer to exist any Hedging Obligations and (b) enter into or be subject to any
agreement or arrangement relating to gold, silver or any other metal which
creates an obligation, whether matured or contingent, of the Borrower to
deliver (or that could be called for delivery or cash settlement) in any Fiscal
Quarter, when taken together with all other such obligations of the Borrower,
more than 70% of the forecast payable production of the Borrower and its
Subsidiaries of any such other metal for such Fiscal Quarter (as set forth in
the Hecla Mine Plan most recently delivered under clause (l) of Section
7.1.1). The Borrower will not enter into or be subject to any Hedging
Agreement (a) which is margined, (b) with respect to which the obligations of
the Borrower are secured by a Lien (other than a Lien in favor of a Lender or
an Affiliate of a Lender securing Hedging Obligations) on the property,
revenues or assets of the Borrower, (c) with a counterparty (other than a
Lender or an Affiliate of a Lender) with a credit rating of lower than A2 from
Moody’s, lower than A from S&P or lower than A from Fitch or that has a
combined capital and surplus of less than $250,000,000, or (d) for speculative
purposes. 

          SECTION 7.2.15. Greens Creek Participant Restrictions.
Notwithstanding anything herein to the contrary, the Borrower shall not permit
Greens Creek Participants to engage in any business activity other than in connection
with the owning and holding of the Greens Creek Joint Venture (including the
assets and properties related thereto) and those activities reasonably
incidental thereto, including complying with the terms of the Greens Creek
Joint Venture Agreement. In furtherance of, and not in limitation of the
foregoing, the Borrower shall not permit the Greens Creek Participants to: 

	
 

	
 

	
 

	
          (a)
 own any material assets, except for its interests in the Greens Creek Joint
 Venture, including (i) its ownership interests in the Greens Creek Joint
 Venture, (ii) its rights to receive income, distributions, products and
 proceeds from the Greens Creek Joint Venture and (iii) its share in the
 assets and properties of the Greens Creek Joint Venture; 

	
 

	
 

	
 

	
          (b)
 create, incur, assume or suffer to exist or otherwise become or be liable in
 respect of any Indebtedness or other liabilities or obligations except for
 (i) the obligations under the Loan Documents, (ii) obligations payable to the
 Borrower as a result of Investments described in Section 7.1.9 and
 (iii) its share of Indebtedness or other liabilities or obligations of the
 Greens Creek Joint Venture; 

	
 

	
 

	
 

	
          (c)
 create, incur or permit to exist any Lien (other than the Liens created
 pursuant to the Loan Documents or Liens permitted under clause (h), (j)
 or (k) of Section 7.2.3); 

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          (d)
 make, incur, assume or suffer to exist any Investment (other than Investments
 in the Greens Creek Joint Venture and its share of Investments made by the
 Greens Creek Joint Venture); 

	
 

	
 

	
 

	
          (e)
 make or commit to make any Capital Expenditure or enter into any arrangement
 which would give rise to any capitalized lease liability (other than Capital
 Expenditures, or capitalized leases made or incurred in connection with the
 Greens Creek Joint Venture); 

	
 

	
 

	
 

	
          (f)
 enter into any arrangement which involves the leasing by the Greens Creek
 Participants from any lessor of any real or personal property (or any
 interest therein) (other than its interests in of any such arrangement
 entered into by the Greens Creek Joint Venture); 

	
 

	
 

	
 

	
          (g)
 sell, transfer, lease or otherwise dispose of, or grant to any Person
 options, warrants or other rights with respect to, any of its assets (other
 than its interests in any such sale, transfer, lease, grant or other
 disposition consummated by the Greens Creek Joint Venture); 

	
 

	
 

	
 

	
          (h)
 enter into any transaction of merger, consolidation or amalgamation, or
 liquidate, wind up or dissolve itself (or suffer any liquidation or
 dissolution); or 

	
 

	
 

	
 

	
          (i)
 permit or suffer to exist any Default described in Section 8.1.9 with
 respect to the Greens Creek Participants. 

          SECTION 7.2.16. Change to Fiscal Year. The Borrower will
not change its Fiscal Year. 

          SECTION 7.2.17. Sale and Leaseback. The Borrower will not,
nor will the Borrower permit any of its Subsidiaries to, directly or indirectly
enter into any agreement or arrangement providing for the sale or transfer by
it of any property (now owned or hereafter acquired) to a Person and the
subsequent lease or rental of such property or other similar property from such
Person to the extent the Dispositions related to any such transaction exceed
(individually, in the aggregate or when aggregated with all Dispositions
described in clause (e) of Section 7.2.10) $10,000,000 per year; provided,
however, that, neither the Borrower nor any Subsidiary may engage in any
sale and leaseback transaction involving its interests in (x) the Greens Creek
Joint Venture Agreement, (y) the assets of any of the Greens Creek Joint
Venture, the Greens Creek Mine or the Lucky Friday Mine (including its rights
to receive income, distributions, products or proceeds therefrom) except with
respect to inventory and obsolete, damaged, immaterial, worn out or surplus
property transferred in the ordinary course of business or (z) any member of
the Greens Creek Group or Hecla Limited. 

ARTICLE VIII

EVENTS OF DEFAULT

          SECTION 8.1. Listing of Events of Default. Each of the
following events or occurrences described in this Article shall constitute an “Event
of Default”. 

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          SECTION 8.1.1. Non-Payment of Obligations. The Borrower or
any other Obligor shall default in the payment or prepayment when due of 

	
 

	
 

	
 

	
          (a)
 any principal of any Loan; or

	
 

	
 

	
 

	
          (b)
 any interest on any Loans or any fee described in Article III or any
 other monetary Obligation, and such default shall continue unremedied for a
 period of three Business Days after such amount was due.

          SECTION 8.1.2. Breach of Warranty. Any representation or
warranty of any Obligor made or deemed to be made in any Loan Document
(including any certificates delivered pursuant to Article V) is or shall
be incorrect when made or deemed to have been made in any material respect. 

          SECTION 8.1.3. Non-Performance of Certain Covenants and
Obligations. 

	
 

	
 

	
 

	
          (a)
 Any Obligor shall default in the due performance or observance of any of its
 obligations under Section 2.3, clauses (d), (e), (f),
 (h), (j), (k), (l), (m), (n) and (p)
 of Section 7.1.1, Section 7.1.6, Section 7.1.7, Section
 7.1.8, Section 7.1.9, Section 7.1.10, Section 7.1.12,
 Section 7.1.13, Section 7.1.14 or Section 7.2 or any
 Obligor shall default in the due performance or observance of its obligations
 under (i) Articles II and IV of the Subsidiary Guaranty or (ii) Article IV of
 a Security Agreement, taking into account any grace periods provided in such
 Subsidiary Guaranty or Security Agreement.

	
 

	
 

	
 

	
          (b)
 The Borrower shall default in the due performance or observance of any of its
 obligations under clauses (a), (b), (c), (g), (i)
 and (o) of Section 7.1.1 and such default shall continue
 unremedied for a period of 10 days.

          SECTION 8.1.4. Non-Performance of Other Covenants and
Obligations. Any Obligor shall default in the due performance and
observance of any other agreement contained in any Loan Document executed by
it, and such default shall continue unremedied for a period of 30 days after
the earlier to occur of (i) notice thereof given to the Borrower by the
Administrative Agent or any Lender or (ii) the date on which an officer of any
Obligor has knowledge of such default. 

          SECTION 8.1.5. Default on Other Indebtedness. 

	
 

	
 

	
 

	
          (a)
 A default shall occur in the payment of any amount when due (subject to any
 applicable grace period), whether by acceleration or otherwise, of any
 principal or stated amount of, or interest or fees (or similar payments) on,
 any Indebtedness (other than Indebtedness described in Section 8.1.1
 or under a Hedging Agreement) of the Borrower or any of its Material
 Subsidiaries having a principal or stated amount, individually or in the
 aggregate, in excess of $5,000,000, or a default shall occur in the
 performance or observance of any obligation or condition with respect to such
 Indebtedness if the effect of such default is to accelerate the maturity of
 any such Indebtedness or such default shall continue unremedied for any
 applicable period of time sufficient to permit the holder or holders of such
 Indebtedness, or any trustee or agent for such holders, to cause or declare
 such Indebtedness to become due and payable or to require such Indebtedness

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to be
 prepaid, redeemed, purchased or defeased, or require an offer to purchase or
 defease such Indebtedness to be made, prior to its expressed maturity; or

	
 

	
 

	
 

	
          (b)
 an early termination event occurs under any Hedging Agreement resulting from
 (x) any default as to which the Borrower is the defaulting party or (y) any
 termination event under such Hedging Agreement as to which the Borrower is an
 affected party and, in either event, the termination value of such Hedging
 Agreement owed by the Borrower or such Subsidiary as a result thereof is
 greater than $5,000,000.

          SECTION 8.1.6. Judgments. Any judgment or order for the
payment of money individually or in the aggregate in excess of $5,000,000
(exclusive of any amounts fully covered by independent third-party insurance
(less any applicable deductible) as to which the insurer has been notified of
the potential claim and does not dispute coverage) shall be rendered against
the Borrower or any of its Material Subsidiaries or the Greens Creek Joint
Venture and such judgment shall not have been vacated or discharged or stayed
or bonded pending appeal within 60 days after the entry thereof or enforcement
proceedings shall have been commenced by any creditor upon such judgment or
order. 

          SECTION 8.1.7. Pension Plans. Any of the following events
shall occur with respect to any Pension Plan 

	
 

	
 

	
 

	
          (a) the
 institution of any steps by the Borrower, any member of its Controlled Group
 or any other Person to terminate a Pension Plan if, as a result of such
 termination, the Borrower or any such member could be required to make a
 contribution to such Pension Plan, or could reasonably expect to incur a
 liability or obligation to such Pension Plan, in excess of $5,000,000; or

	
 

	
 

	
 

	
          (b) a
 contribution failure occurs with respect to any Pension Plan sufficient to
 give rise to a Lien under Section 303(k) of ERISA.

          SECTION 8.1.8. Change in Control. Any Change in Control
shall occur. 

          SECTION 8.1.9. Bankruptcy, Insolvency, etc. The Borrower
or any of its Material Subsidiaries shall 

	
 

	
 

	
 

	
          (a)
 become insolvent or generally fail to pay, or admit in writing its inability
 or unwillingness generally to pay, debts as they become due;

	
 

	
 

	
 

	
          (b)
 apply for, consent to, or acquiesce in the appointment of a trustee,
 receiver, sequestrator or other custodian for any substantial part of the
 property of any thereof, or make a general assignment for the benefit of
 creditors;

	
 

	
 

	
 

	
          (c)
 in the absence of such application, consent or acquiescence in or permit or
 suffer to exist the appointment of a trustee, receiver, sequestrator or other
 custodian for a substantial part of the property of any thereof, and such
 trustee, receiver, sequestrator or other custodian shall not be discharged
 within 60 days; provided that, the Borrower, each Material Subsidiary
 and each other Obligor hereby expressly authorizes each

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Secured
 Party to appear in any court conducting any relevant proceeding during such
 60-day period to preserve, protect and defend their rights under the Loan Documents;

	
 

	
 

	
 

	
          (d)
 permit or suffer to exist the commencement of any bankruptcy, reorganization,
 debt arrangement or other case or proceeding under any bankruptcy or
 insolvency law or any dissolution, winding up or liquidation proceeding, in
 respect thereof, and, if any such case or proceeding is not commenced by the
 Borrower, any Material Subsidiary or any Obligor, such case or proceeding
 shall be consented to or acquiesced in by the Borrower, such Material
 Subsidiary or such Obligor, as the case may be, or shall result in the entry
 of an order for relief or shall remain for 60 days undismissed; provided
 that, the Borrower, each Subsidiary and each Obligor hereby expressly
 authorizes each Secured Party to appear in any court conducting any such case
 or proceeding during such 60-day period to preserve, protect and defend their
 rights under the Loan Documents; or

	
 

	
 

	
 

	
          (e)
 take any action authorizing, or in furtherance of, any of the foregoing.

          SECTION 8.1.10. Impairment of Security, etc. Any Loan
Document or any Lien granted thereunder shall (except in accordance with its
terms), in whole or in part, terminate, fail to be effective or fail to be the
legally valid, binding and enforceable obligation of any Obligor party thereto;
any Obligor shall directly contest in any manner the validity, binding nature
or enforceability of any material provision of any Loan Document; or, except as
permitted under any Loan Document, any Lien securing any Obligation shall, in
whole or in part, fail to be a perfected first priority Lien. 

          SECTION 8.1.11. Failure of Subordination. Unless otherwise
waived or consented to by the Administrative Agent and the Lenders in writing, 

	
 

	
 

	
 

	
          (a)
 the payment postponement and subordination provisions relating to any
 Subordinated Debt (its “Subordination Provisions”) shall fail to be
 enforceable by the Administrative Agent and the Lenders in accordance with
 the terms thereof,

	
 

	
 

	
 

	
          (b)
 the monetary Obligations shall fail to constitute “Senior Indebtedness” (or
 analogous term) referring to the Obligations, or

	
 

	
 

	
 

	
          (c)
 the Borrower or any Subsidiaries shall, directly or indirectly, disavow or
 contest in any manner (x) the effectiveness, validity or enforceability of
 any Subordination Provision, (y) that the Subordination Provisions exist for
 the benefit of the Administrative Agent and the Lenders or (z) that all
 payments of principal of or premium and interest on the Subordinated Debt, or
 realized from the liquidation of any property of any Obligor, shall be
 subject to any of such Subordination Provisions.

          SECTION 8.1.12. Abandonment of Greens Creek Mine or Lucky
Friday Mine. Operation of the principal operating properties of the Greens
Creek Mine or the Lucky Friday Mine shall be abandoned or terminated. 

          SECTION 8.1.13. Regulatory Action. Any Governmental
Authority shall take any action with respect to any mine owned or operated by
Borrower or its Subsidiaries, the operation 

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thereof or the
sale of the production therefrom (including any action that would cause any
license, permit, consent or other Mining Right to cease to be in full force and
effect or to be held to be illegal or invalid and including any action
(including the commencement of an action or proceeding) that results or may
result in the revocation, termination or substantial and adverse modification
of any such license, permit, consent or other Mining Right) which could
reasonably be expected to have a Material Adverse Effect, unless such action is
set aside, dismissed or withdrawn within 60 days of its institution or such
action is being contested in good faith and its effect is stayed during such
contest. 

          SECTION 8.1.14. Material Adverse Change. The occurrence of
a Material Adverse Change. 

          SECTION 8.1.15. Greens Creek. The Greens Creek Manager
shall be a Person other than a member of the Greens Creek Group or the Greens
Creek Joint Venture Agreement shall fail to be effective or fail to be the
legally valid, binding and enforceable obligation of the Greens Creek
Participants. 

          SECTION 8.2. Action if Bankruptcy. If any Event of Default
described in clauses (a) through (d) of Section 8.1.9 with
respect to any Obligor shall occur, the Commitments (if not theretofore
terminated) shall automatically terminate and the outstanding principal amount
of all outstanding Loans and all other Obligations shall automatically be and
become immediately due and payable, without notice or demand to any Person. 

          SECTION 8.3. Action if Other Event of Default. If any
Event of Default (other than any Event of Default described in clauses (a)
through (d) of Section 8.1.9 with respect to any Obligor) shall
occur for any reason, whether voluntary or involuntary, and be continuing, the
Administrative Agent, upon the direction of the Required Lenders, shall by
notice to the Borrower declare all or any portion of the outstanding principal
amount of the Loans and other Obligations to be due and payable, whereupon the
full unpaid amount of such Loans and other Obligations which shall be so
declared due and payable shall be and become immediately due and payable,
without further notice, demand or presentment, and/or, as the case may be, the
Commitments shall terminate. Notwithstanding anything to the contrary contained
herein or in any other Loan Document, the authority to enforce rights and
remedies hereunder and under the other Loan Documents shall be vested
exclusively in, and all actions and proceedings at law in connection with such enforcement
shall be instituted and maintained exclusively by, the Administrative Agent in
accordance with this Section and Section 8.2 for the benefit of all the
Lenders; provided, however, that the foregoing shall not prohibit
any Lender from exercising setoff rights in accordance with Section 4.9. 

ARTICLE IX 

THE ADMINISTRATIVE AGENT

          SECTION 9.1. Appointments; Actions. Each Lender hereby
appoints Scotiabank as its Administrative Agent under and for purposes of each
Loan Document. Each Lender authorizes the Administrative Agent to act on behalf
of such Lender under each Loan Document and, in the absence of other written
instructions from the Required Lenders received from time to time by the
Administrative Agent (with respect to which the Administrative Agent agrees
that it will 

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comply, except
as otherwise provided in this Section or as otherwise advised by counsel in
order to avoid contravention of Applicable Law), to exercise such powers
hereunder and thereunder as are specifically delegated to or required of the
Administrative Agent by the terms hereof and thereof, together with such powers
as may be incidental thereto (including the release of Liens on assets Disposed
of in accordance with the terms of the Loan Documents). Each Lender hereby
indemnifies (which indemnity shall survive any termination of this Agreement)
the Administrative Agent, pro rata according to such Lender’s
proportionate Total Exposure Amount, from and against any and all liabilities,
obligations, losses, damages, claims, costs or expenses of any kind or nature
whatsoever which may at any time be imposed on, incurred by, or asserted
against, the Administrative Agent in any way relating to or arising out of any
Loan Document, (including attorneys’ fees), and as to which the Administrative
Agent is not reimbursed by the Borrower; provided that, no Lender shall
be liable for the payment of any portion of such liabilities, obligations,
losses, damages, claims, costs or expenses which are determined by a court of
competent jurisdiction in a final proceeding to have resulted from the
Administrative Agent’s gross negligence or willful misconduct. The
Administrative Agent shall not be required to take any action under any Loan
Document, or to prosecute or defend any suit in respect of any Loan Document,
unless it is indemnified hereunder to its satisfaction. If any indemnity in
favor of the Administrative Agent shall be or become, in the Administrative
Agent’s determination, inadequate, the Administrative Agent may call for additional
indemnification from the Lenders and cease to do the acts indemnified against
hereunder until such additional indemnity is given. 

          SECTION 9.2. Funding Reliance, etc. Unless the
Administrative Agent shall have been notified in writing by any Lender by 3:00
p.m. on the Business Day prior to a Borrowing that such Lender will not make
available the amount which would constitute its Percentage of such Borrowing on
the date specified therefor, the Administrative Agent may assume that such Lender
has made such amount available to the Administrative Agent and, in reliance
upon such assumption, make available to the Borrower a corresponding amount. If
and to the extent that such Lender shall not have made such amount available to
the Administrative Agent, such Lender and the Borrower severally agree to repay
the Administrative Agent forthwith on demand such corresponding amount together
with interest thereon, for each day from the date the Administrative Agent made
such amount available to the Borrower to the date such amount is repaid to the
Administrative Agent, at an interest rate equal to (x) in the case of the
Borrower, the interest rate applicable at the time to Loans comprising such
Borrowing and (y) in the case of a Lender, at the Federal Funds Rate (for the
first two Business Days after which such amount has not been repaid), and
thereafter at the interest rate applicable to Loans comprising such Borrowing. 

          SECTION 9.3. Exculpation. Neither the Administrative Agent
or any of its directors, officers, employees or agents shall be liable to any
Secured Party for any action taken or omitted to be taken by it under any Loan
Document, or in connection therewith, except for its own willful misconduct or
gross negligence, nor responsible for any recitals or warranties herein or
therein, nor for the effectiveness, enforceability, validity or due execution
of any Loan Document, nor for the creation, perfection or priority of any Liens
purported to be created by any of the Loan Documents, or the validity,
genuineness, enforceability, existence, value or sufficiency of any collateral
security, nor to make any inquiry respecting the performance by any Obligor of
its Obligations. Any such inquiry which may be made by either Agent shall not 

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obligate it to
make any further inquiry or to take any action. The Administrative Agent shall
be entitled to rely upon advice of counsel concerning legal matters and upon
any notice, consent, certificate, statement or writing which the Administrative
Agent believes to be genuine and to have been presented by a proper Person. 

          SECTION 9.4. Successor. The Administrative Agent may
resign as such at any time upon at least 30 days’ prior notice to the Borrower
and all Lenders. If the Administrative Agent at any time shall resign, the
Required Lenders may appoint another Lender as a successor Administrative Agent
which shall thereupon become the Administrative Agent hereunder. If no
successor Administrative Agent shall have been so appointed by the Required
Lenders, or shall have accepted such appointment, within 30 days after the
retiring Administrative Agent’s giving notice of resignation, then, the
retiring Administrative Agent may, on behalf of the Lenders, appoint a
successor Administrative Agent, which shall be one of the Lenders or a
commercial banking institution organized under the laws of the United States
(or any State thereof) or a United States branch or agency of a commercial
banking institution, and having a combined capital and surplus of at least
$250,000,000; provided, however, that if such retiring
Administrative Agent is unable to find a commercial banking institution which
is willing to accept such appointment and which meets the qualifications set
forth in above, 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 as provided for above.
Upon the acceptance of any appointment as Administrative Agent hereunder by a
successor Administrative Agent, such successor Administrative Agent shall be
entitled to receive from the retiring Administrative Agent such documents of
transfer and assignment as such successor Administrative Agent may reasonably
request, and shall thereupon succeed to and become vested with all rights,
powers, privileges and duties of the retiring Administrative Agent, and the
retiring Administrative Agent shall be discharged from its duties and
obligations under the Loan Documents. After any retiring Administrative Agent’s
resignation hereunder as the Administrative Agent, the provisions of this
Article shall inure to its benefit as to any actions taken or omitted to be taken
by it while it was the Administrative Agent under the Loan Documents, and
Sections 10.3 and 10.4 shall continue to inure to its benefit. 

          SECTION 9.5. Loans by Scotiabank. Scotiabank shall have
the same rights and powers with respect to (x) the Credit Extensions made by it
or any of its Affiliates, and (y) the Notes held by it or any of its Affiliates
as any other Lender and may exercise the same as if it were not the
Administrative Agent hereunder. The Administrative Agent and each of its respective
Affiliates may accept deposits from, lend money to, and generally engage in any
kind of business with the Borrower or any Subsidiary or Affiliate of the
Borrower as if the Administrative Agent was not the Administrative Agent. 

          SECTION 9.6. Credit Decisions. Each Lender acknowledges
that it has, independently of the Administrative Agent and each other Lender,
and based on such Lender’s review of the financial information of the Borrower,
the Loan Documents (the terms and provisions of which being satisfactory to
such Lender) and such other documents, information and investigations as such
Lender has deemed appropriate, made its own credit decision to extend its
Commitments. Each Lender also acknowledges that it will, independently of the Administrative
Agent and each other Lender, and based on such other documents, information and
investigations as it shall deem 

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appropriate at
any time, continue to make its own credit decisions as to exercising or not
exercising from time to time any rights and privileges available to it under
the Loan Documents. 

          SECTION 9.7. Copies, etc. The Administrative Agent shall
give prompt notice to each Lender of each notice or request required or
permitted to be given to the Administrative Agent by the Borrower pursuant to
the terms of the Loan Documents (unless concurrently delivered to the Lenders
by the Borrower). The Administrative Agent will distribute to each Lender each
document or instrument received for its account and copies of all other
communications received by the Administrative Agent from the Borrower for
distribution to the Lenders by the Administrative Agent in accordance with the
terms of the Loan Documents. 

          SECTION 9.8. Reliance by Administrative Agent. The
Administrative Agent shall be entitled to rely upon any certification, notice
or other communication (including any thereof by telephone, facsimile,
electronic mail, Internet and intranet websites) believed by it to be genuine
and correct and to have been signed or sent by or on behalf of the proper
Person, and upon advice and statements of legal counsel, independent
accountants and other experts selected by the Administrative Agent. As to any
matters not expressly provided for by the Loan Documents, the Administrative
Agent shall in all cases be fully protected in acting, or in refraining from
acting, thereunder in accordance with instructions given by the Required
Lenders or all of the Lenders as is required in such circumstance, and such
instructions of such Lenders and any action taken or failure to act pursuant
thereto shall be binding on all Secured Parties. For purposes of applying
amounts in accordance with this Section, the Administrative Agent shall be
entitled to rely upon any Secured Party that has entered into a Lender Hedging
Agreement with any Obligor for a determination (which such Secured Party agrees
to provide or cause to be provided upon request of the Administrative Agent) of
the outstanding Obligations owed to such Secured Party under any Lender Hedging
Agreement. Unless it has actual knowledge evidenced by way of written notice
from any such Secured Party and the Borrower to the contrary, the
Administrative Agent, in acting in such capacity under the Loan Documents,
shall be entitled to assume that no Lender Hedging Agreements or Obligations in
respect thereof are in existence or outstanding between any Secured Party and
any Obligor. 

          SECTION 9.9. Defaults. The Administrative Agent shall be
deemed not to have knowledge or notice of the occurrence of a Default unless
the Administrative Agent has received a written notice from a Lender or the
Borrower specifying such Default and stating that such notice is a “Notice of
Default”. In the event that the Administrative Agent receives such a notice of
the occurrence of a Default, the Administrative Agent shall give prompt notice
thereof to the Lenders. The Administrative Agent shall (subject to Section
10.1) take such action with respect to such Default as shall be directed by
the Required Lenders; 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 as it shall deem advisable in the best
interest of the Secured Parties except to the extent that this Agreement
expressly requires that such action be taken, or not be taken, only with the
consent or upon the authorization of the Required Lenders or all Lenders. 

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          SECTION 9.10. Appointment of Supplemental Agents, Sub-Agents;
etc. 

	
 

	
 

	
 

	
          (a)
 In the event the Administrative Agent reasonably deems it necessary to comply
 with Applicable Law or, with the consent of the Borrower (such consent not to
 be unreasonably withheld or delayed), desirable, it may, in respect of the
 collateral securing the Obligations, appoint an additional individual or
 institution as a separate trustee, co-trustee, collateral agent or collateral
 co-agent (any such additional individual or institution being referred to
 herein individually as a “Supplemental Agent” and collectively as “Supplemental
 Agents”). Such Supplemental Agent or Supplemental Agents shall have, in
 respect of the collateral securing the Obligations, each and every right,
 power, privilege or duty expressed or intended by this Agreement or any of
 the other Loan Documents to be exercised by or vested in or conveyed to the
 Administrative Agent with respect to such collateral, to the extent necessary
 to enable such Supplemental Agent to exercise such rights, powers and
 privileges with respect to such collateral and to perform such duties with
 respect to such collateral. 

	
 

	
 

	
 

	
          (b)
 Without limiting the provisions of the foregoing clause (a), the
 Administrative Agent may perform any and all of its duties and exercise its
 rights and powers hereunder or under any other Loan Document by or through
 any one or more sub-agents appointed by such Administrative Agent. The
 Administrative Agent and any such sub-agent may perform any and all of its
 duties and exercise its rights and powers by or through their respective
 officers, directors, employees and agents. 

	
 

	
 

	
 

	
          (c)
 Should any instrument in writing from any Obligor be required by any
 Supplemental Agent or sub-agent so appointed by the Administrative Agent to
 more fully and certainly vest in and confirm to him or it such rights,
 powers, privileges and duties, the Borrowers shall, or shall cause such
 Obligor to, execute, acknowledge and deliver any and all such instruments
 promptly upon request by the Administrative Agent. In case any Supplemental
 Agent or sub-agent, or a successor thereto, shall die, become incapable of
 acting, resign or be removed, all the rights, powers, privileges and duties
 of such Supplemental Agent or sub-agent, to the extent permitted by law,
 shall vest in and be exercised by the Administrative Agent until the
 appointment of a new Supplemental Agent or sub-agent. The provisions of Sections
 9.1, 9.3 and 10.4 that refer to the Administrative Agent
 shall inure to the benefit of each Supplemental Agent and each sub-agent and
 all references therein to the Administrative Agent shall be deemed to be
 references to the Administrative Agent and/or each Supplemental Agent and/or
 sub-agent, as the context may require. 

ARTICLE X 

MISCELLANEOUS PROVISIONS

          SECTION 10.1. Waivers, Amendments, etc. The provisions of
each Loan Document may from time to time be amended, modified or waived, if
such amendment, modification or waiver is in writing and consented to by the
Obligor or Obligors party to such Loan Document and the Required Lenders; provided
that, no such amendment, modification or waiver shall: 

	
 

	
 

	
 

	
          (a)
 modify clause (b) of Section 4.7, Section 4.8 (as it
 relates to sharing of payments) or this Section without the consent of all
 Lenders;

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          (b)
 increase the aggregate amount of any Credit Extensions required to be made by
 a Lender pursuant to its Commitments or extend the final Stated Maturity Date
 for any Lender’s Loans, in each case without the consent of such Lender (it
 being agreed, however, that any vote to rescind any acceleration made
 pursuant to Section 8.2 and Section 8.3 of amounts owing with
 respect to the Loans and other Obligations shall only require the vote of the
 Required Lenders); 

	
 

	
 

	
 

	
          (c)
 reduce the principal amount of or reduce the rate of interest on any Lender’s
 Loans, reduce any fees described in Article III payable to any Lender,
 waive payment Defaults or extend the scheduled date on which principal,
 interest or fees are payable in respect of such Lender’s Loans, in each case
 without the consent of such Lender (provided that, the vote of
 Required Lenders shall be sufficient to waive the payment, or reduce the
 increased portion, of interest accruing under Section 3.2.2); 

	
 

	
 

	
 

	
          (d)
 change (either positive or negative) the percentage set forth in the
 definition of “Required Lenders” or modify any requirement hereunder that any
 particular action be taken by all Lenders without the consent of all Lenders;
 

	
 

	
 

	
 

	
          (e)
 except as otherwise expressly provided in a Loan Document, release (i) the
 any Obligor from its Obligations under the Loan Documents to which such
 Obligor is a party or (ii) any collateral (unless in connection with a
 Disposition permitted under Section 7.2.10) under the Loan Documents,
 in each case without the consent of all Lenders; or 

	
 

	
 

	
 

	
          (f)
 affect adversely the interests, rights or obligations of the Administrative
 Agent (in its capacity as the Administrative Agent).

No failure or
delay on the part of any Secured Party in exercising any power or right under
any Loan Document shall operate as a waiver thereof, nor shall any single or
partial exercise of any such power or right preclude any other or further
exercise thereof or the exercise of any other power or right. No notice to or
demand on any Obligor in any case shall entitle it to any notice or demand in
similar or other circumstances. No waiver or approval by any Secured Party
under any Loan Document shall, except as may be otherwise stated in such waiver
or approval, be applicable to subsequent transactions. No waiver or approval
hereunder shall require any similar or dissimilar waiver or approval thereafter
to be granted hereunder. 

Further,
notwithstanding anything to the contrary contained in Section 10.1, if
within sixty days following the effective date of any Loan Document, the
Administrative Agent and the Borrower shall have jointly identified an obvious
error or any error or omission of a technical or immaterial nature, in each
case, in any provision of the Loan Documents, then the Administrative Agent and
the Borrower shall be permitted to amend such provision and such amendment
shall become effective without any further action or consent of any other party
to any Loan Document if the same is not objected to in writing by the Required
Lenders within five Business Days following receipt of notice thereof. 

          SECTION 10.2. Notices; Time.
All notices and other
communications provided under each Loan Document shall be in writing or by
facsimile and addressed, delivered or transmitted, 

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if to the
Borrower, the Administrative Agent or a Lender, to the applicable Person at its
address or facsimile number set forth on Schedule II hereto or set forth in the
Lender Assignment Agreement, or at such other address or facsimile number as
may be designated by such party in a notice to the other parties. Any notice,
if mailed and properly addressed with postage prepaid or if properly addressed
and sent by pre-paid courier service, shall be deemed given when received; any
notice, if transmitted by facsimile, shall be deemed given when the
confirmation of transmission thereof is received by the transmitter. Electronic
mail and Internet and intranet websites may be used by the Administrative Agent
and the Lenders to distribute communications to one another, including consent
and waiver approvals, financial statements and other information as provided in
Section 7.1.1 and for the distribution and execution of Loan Documents
for execution by the parties thereto, and may not be used for any other
purpose. Unless otherwise indicated, all references to the time of a day in a
Loan Document shall refer to New York time.  

          SECTION 10.3. Payment of Costs and
Expenses. The Borrower
agrees to pay on demand all reasonable expenses of the Administrative Agent and
the Lead Arranger (including the reasonable fees and out-of-pocket expenses of
Mayer Brown LLP, counsel to the Administrative Agent and of local counsel, if
any, who may be retained by or on behalf of the Administrative Agent) in
connection with 

	
 

	
 

	
 

	
          (a)
 the negotiation, preparation, execution and delivery of each Loan Document,
 including schedules and exhibits, and any amendments, waivers, consents,
 supplements or other modifications to any Loan Document as may from time to
 time hereafter be required, whether or not the transactions contemplated
 hereby or thereby are consummated; and 

	
 

	
 

	
 

	
          (b)
 the filing or recording of any Loan Document (including the Filing
 Statements) and all amendments, supplements, amendment and restatements and
 other modifications to any thereof, searches made following the Effective
 Date in jurisdictions where Filing Statements (or other documents evidencing
 Liens in favor of the Secured Parties) have been recorded and any and all
 other documents or instruments of further assurance required to be filed or
 recorded by the terms of any Loan Document; 

	
 

	
 

	
 

	
          (c)
 the conduct of due diligence and related matters conducted in connection with
 the Loan Documents and the syndication of the Loans; and 

	
 

	
 

	
 

	
          (d)
 the preparation and review of the form of any document or instrument or any
 information relevant to any Loan Document. 

          The
Borrower further agrees to pay, and to save each Secured Party harmless from
all liability for, any stamp or other taxes or notarial fees which may be
payable in connection with the execution or delivery of each Loan Document, the
Credit Extensions or the issuance of the Notes. The Borrower also agrees to
reimburse the Administrative Agent and the Lenders upon demand for all
out-of-pocket expenses (including attorneys’ fees and legal expenses of counsel
to the Administrative Agent and the Lenders) incurred by the Administrative
Agent in connection with (x) the negotiation of any restructuring or “work-out”
with the Borrower, whether or not consummated, of any Obligations and (y) the
enforcement of any Obligations. 

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          SECTION 10.4. Indemnification.
In consideration of the
execution and delivery of this Agreement by each Secured Party, the Borrower
hereby indemnifies, exonerates and holds each Secured Party and each of their
respective officers, partners, trustees, members, shareholders, directors,
employees, agents and Affiliates (collectively, the “Indemnified Parties”)
free and harmless from and against any and all actions, causes of action,
suits, losses, claims, costs, liabilities and damages, and expenses incurred in
connection therewith (irrespective of whether any such Indemnified Party is a
party to the action for which indemnification hereunder is sought), including
attorneys’ fees and disbursements, whether incurred in connection with actions
between or among the parties hereto or the parties hereto and third parties
(collectively, the “Indemnified Liabilities”), incurred by the
Indemnified Parties or any of them as a result of, or arising out of, or
relating to: 

	
 

	
 

	
 

	
          (a)
 any transaction financed or to be financed in whole or in part, directly or
 indirectly, with the proceeds of any Credit Extension, including all
 Indemnified Liabilities arising in connection with the Transaction; 

	
 

	
 

	
 

	
          (b)
the entering into and performance of any Loan Document by any of the
Indemnified Parties (including any action brought by or on behalf of the Borrower
as the result of any determination by the Required Lenders pursuant to
Article V not to fund any Credit Extension, provided that any such action is
resolved in favor of such Indemnified Party);  

	
 

	
 

	
 

	
          (c)
 any investigation, litigation or proceeding related to any acquisition or
 proposed acquisition by any Obligor or any Subsidiary thereof of all or any
 portion of the Capital Securities or assets of any Person, whether or not an
 Indemnified Party is party thereto; 

	
 

	
 

	
 

	
          (d)
 any investigation, litigation or proceeding related to any environmental
 cleanup, audit, compliance or other matter relating to the protection of the
 environment or the Release by any Obligor or any Subsidiary thereof of any
 Hazardous Material; 

	
 

	
 

	
 

	
          (e)
 the presence on or under, or the escape, seepage, leakage, spillage,
 discharge, emission, discharging or releases from, any real property owned or
 operated by any Obligor or any Subsidiary thereof of any Hazardous Material
 (including any losses, liabilities, damages, injuries, costs, expenses or
 claims asserted or arising under any Environmental Law), regardless of
 whether caused by, or within the control of, such Obligor or Subsidiary; or 

	
 

	
 

	
 

	
          (f)
 each Lender’s Environmental Liability (the indemnification in this clause
 (f) shall survive repayment of the Obligations and any transfer of the
 property of any Obligor or its Subsidiaries by foreclosure or by a deed in
 lieu of foreclosure for any Lender’s Environmental Liability, regardless of
 whether caused by, or within the control of, such Obligor or such
 Subsidiary); 

except for
Indemnified Liabilities arising for the account of a particular Indemnified
Party primarily by reason of the relevant Indemnified Party’s gross negligence
or willful misconduct as finally determined by a court of competent
jurisdiction. Each Obligor and its successors and 

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assigns hereby
waive, release and agree not to make any claim or bring any cost recovery
action against, any Indemnified Party under CERCLA or any state equivalent, or
any similar Applicable Law now existing or hereafter enacted. It is expressly
understood and agreed that to the extent that any Indemnified Party is strictly
liable under any Environmental Laws, each Obligor’s obligation to such Indemnified
Party under this indemnity shall likewise be without regard to fault on the
part of any Obligor relative to the violation or condition which results in
liability of an Indemnified Party. If and to the extent that the foregoing
undertaking may be unenforceable for any reason, each Obligor agrees to make
the maximum contribution to the payment and satisfaction of each of the
Indemnified Liabilities which is permissible under Applicable Law. To the
extent permitted by Applicable Law, no party to this Agreement shall not
assert, and hereby waives, any claim against any other party to this Agreement
on any theory of liability, for special, indirect, consequential or punitive
damages (as opposed to direct or actual damages) arising out of, in connection
with, or as a result of, this Agreement or any other Loan Document, the Credit
Extension or the use of the proceeds thereof. 

          SECTION 10.5. Survival. The
obligations of the Borrower
under Sections 4.3, 4.4, 4.5, 4.6, 10.3 and 10.4,
and the obligations of the Lenders under Section 9.1, shall in each case
survive any assignment from one Lender to another (in the case of Sections
10.3 and 10.4) and the occurrence of the Termination Date. The
representations and warranties made by each Obligor in each Loan Document shall
survive the execution and delivery of such Loan Document. 

          SECTION 10.6. Severability.
Any provision of any Loan
Document which is prohibited or unenforceable in any jurisdiction shall, as to
such provision and such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions
of such Loan Document or affecting the validity or enforceability of such
provision in any other jurisdiction. 

          SECTION 10.7. Headings. The
various headings of each Loan
Document are inserted for convenience only and shall not affect the meaning or
interpretation of such Loan Document or any provisions thereof. 

          SECTION 10.8. Execution in
Counterparts, Effectiveness, etc.
This Agreement may be executed by the parties hereto in several counterparts,
each of which shall be an original and all of which shall constitute together
but one and the same agreement. This Agreement shall become effective when
counterparts hereof executed on behalf of the Borrower, the Administrative
Agent and each Lender (or notice thereof satisfactory to the Administrative
Agent), shall have been received by the Administrative Agent. The parties
hereto agree that delivery of an executed counterpart of a signature page to
this Agreement and each other Loan Document by facsimile (or electronic
transmission) shall be effective as delivery of an original executed
counterpart of this Agreement or such other Loan Document. 

          SECTION 10.9. Governing Law;
Entire Agreement. EACH LOAN
DOCUMENT (OTHER THAN THE LETTERS OF CREDIT, TO THE EXTENT SPECIFIED BELOW AND
EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN A LOAN DOCUMENT) WILL EACH BE DEEMED
TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF
NEW YORK (INCLUDING FOR SUCH PURPOSE 

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SECTIONS
5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK). The
Loan Documents and the commitment letter, dated as of February 6, 2008, between
the Borrower and the Bank of Nova Scotia constitute the entire understanding
among the parties hereto with respect to the subject matter thereof and
supersede any prior agreements, written or oral, with respect thereto. 

          SECTION 10.10. Successors and
Assigns. This Agreement shall
be binding upon and shall inure to the benefit of the parties hereto and their
respective successors and assigns; provided that, the Borrower may not
assign or transfer its rights or obligations hereunder (other than pursuant to Section
7.2.15) without the consent of all Lenders. 

          SECTION 10.11. Sale and Transfer
of Credit Extensions;
Participations in Credit Extensions; Notes. Each Lender may assign, or sell
participations in, its Loans to one or more other Persons in accordance with
the terms set forth below. 

	
 

	
 

	
 

	
 

	
          (a)
 Subject to clause (b), any Lender may assign to one or more Eligible
 Assignees all or a portion of its rights and obligations under the Loan
 Documents (including all or a portion of Loans at the time owing to it); provided
 that: 

	
 

	
 

	
 

	
 

	
          (i)
 except in the case of (A) an assignment of the entire remaining amount of the
 Loans owing to the assigning Lender or (B) an assignment to a Lender, an
 Affiliate of a Lender or an Approved Fund with respect to a Lender, the
 aggregate principal outstanding balance of the Loans of the assigning Lender
 subject to each such assignment (determined as of the date the Lender
 Assignment Agreement with respect to such assignment is delivered to the
 Administrative Agent) shall not be less than $10,000,000, unless the
 Administrative Agent and, so long as no Default has occurred and is
 continuing, the Borrower, otherwise consent (in each case, such consent not
 to be unreasonably withheld or delayed); 

	
 

	
 

	
 

	
 

	
 

	
          (ii)
 except in the case of an assignment of the entire remaining amount of the
 Loans owing to the assigning Lender, no Lender shall retain less than
 $10,000,000 following any assignment; 

	
 

	
 

	
 

	
 

	
 

	
          (iii)
 each partial assignment shall be made as an assignment of a proportionate
 part of all the assigning Lender’s rights and obligations under this
 Agreement with respect to the Loans assigned; and 

	
 

	
 

	
 

	
 

	
 

	
          (iv)
 the parties to each assignment shall execute and deliver to the
 Administrative Agent a Lender Assignment Agreement, together with a
 processing and recordation fee of $3,500 and if the Eligible Assignee is not
 already Lender, administrative details information with respect to such
 Eligible Assignee and applicable tax forms. 

	
 

	
 

	
 

	
 

	
          (b)
 Any assignment proposed pursuant to clause (a) to any Eligible
 Assignee (other than a Lender, an Affiliate of a Lender or an Approved Fund,
 or, if such assignment is made during the Primary Syndication, any other
 Eligible Assignee) shall be subject to the prior written approval of (i) the
 Administrative Agent (not to be unreasonably withheld) and (ii) except in the
 case of an assignment to a Lender or an 

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Affiliate of
 a Lender, so long as no Default has occurred and is continuing on the date
 such assignment is to become effective, the Borrower (such consent not to be
 unreasonably withheld or delayed). If the consent of the Borrower to an
 assignment or to an Eligible Assignee is required hereunder (including a
 consent to an assignment which does not meet the minimum assignment
 thresholds specified in this Section), the Borrower shall be deemed to have
 given its consent ten Business Days after the date notice thereof has been
 delivered by the assigning Lender (through the Administrative Agent) to the
 Borrower, unless such consent is expressly refused by the Borrower prior to
 such tenth Business Day.

	
 

	
 

	
 

	
          (c)
 Subject to acceptance and recording thereof by the Administrative Agent
 pursuant to clause (d), from and after the effective date specified in
 each Lender Assignment Agreement, (i) the Eligible Assignee thereunder shall
 (if not already a Lender) be a party hereto and, to the extent of the
 interest assigned by such Lender Assignment Agreement, have the rights and
 obligations of a Lender under the Loan Documents, and (ii) the assigning
 Lender thereunder shall (subject to Section 10.5) be released from its
 obligations under the Loan Documents, to the extent of the interest assigned
 by such Lender Assignment Agreement (and, in the case of a Lender Assignment
 Agreement covering all of the assigning Lender’s rights and obligations under
 the Loan Documents, such Lender shall cease to be a party hereto, but shall
 (as to matters arising prior to the effectiveness of the Lender Assignment
 Agreement) continue to be entitled to the benefits of any provisions of the
 Loan Documents which by their terms survive the termination of this
 Agreement). Any assignment or transfer by a Lender of rights or obligations
 under this Agreement that does not comply with the terms of this Section
 shall be treated for purposes of the Loan Documents as a sale by such Lender
 of a participation in such rights and obligations in accordance with clause
 (e).

	
 

	
 

	
 

	
          (d)
 The Administrative Agent shall record each assignment made in accordance with
 this Section in the Register pursuant to clause (a) of Section 2.6.
 The Register shall be available for inspection by the Borrower and any
 Lender, at any reasonable time upon reasonable prior notice to the
 Administrative Agent.

	
 

	
 

	
 

	
          (e)
 Any Lender may, without the consent of, or notice to, any Person, sell
 participations to one or more Persons (other than individuals) (a “Participant”)
 in all or a portion of such Lender’s rights or obligations under the Loan
 Documents (including all or a portion of the Loans owing to it); provided
 that, (i) such Lender’s obligations under the Loan Documents shall remain
 unchanged, (ii) such Lender shall remain solely responsible to the other
 parties hereto for the performance of such obligations, (iii) no Participant
 nor any Lender transferring a participation shall hold Loans of less than
 $10,000,000 (free and clear of participations) after any such participation
 is completed and (iv) 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 the Loan
 Documents. Each Lender that sells a participating interest in any Loans or
 other interest to a Participant shall, as agent of the Borrower solely for
 the purpose of this clause (e), record in book entries maintained by
 such Lender the name and the amount of the participating interest of each
 Participant entitled to receive

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payments in
 respect of such participating interest. Any agreement or instrument pursuant
 to which a Lender sells a participation shall provide that such Lender shall
 retain the sole right to enforce the rights and remedies of a Lender under
 the Loan Documents and to approve any amendment, modification or waiver of
 any provision of the Loan Documents; provided that, such agreement or
 instrument may provide that such Lender will not, without the consent of the
 Participant, take any action of the type described in clauses (a)
 through (d) or clause (f) of Section 10.1 with respect
 to Obligations participated in by that Participant. Subject to clause (f),
 the Borrower agrees that each Participant shall be entitled to the benefits
 of Sections 4.3, 4.4, 4.5, 4.6, 7.1.1, 10.3
 and 10.4 to the same extent as if it were a Lender and had acquired
 its interest by assignment pursuant to clause (c). To the extent
 permitted by law, each Participant also shall be entitled to the benefits of Section
 4.9 as though it were a Lender, but only if such Participant agrees to be
 subject to Section 4.8 as though it were a Lender.

	
 

	
 

	
 

	
          (f)
 A Participant shall not be entitled to receive any greater payment under Section
 4.3, 4.4, 4.5, 4.6, 10.3 or 10.4 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 prior written consent. A
 Participant that would be a Non-U.S. Secured Party if it were a Lender shall
 not be entitled to the benefits of Section 4.6 unless the Borrower is
 notified of the participation sold to such Participant and such Participant
 agrees, for the benefit of the Borrower, to comply with the requirements set
 forth in Section 4.6 as though it were a Lender. Any Lender that sells
 a participating interest in any Loans or other interest to a Participant
 under this Section shall indemnify and hold harmless the Borrower and the
 Administrative Agent from and against any taxes, penalties, interest or other
 costs or losses (including reasonable attorneys’ fees and expenses) incurred
 or payable by the Borrower or the Administrative Agent as a result of the
 failure of the Borrower or the Administrative Agent to comply with its
 obligations to deduct or withhold any Taxes from any payments made pursuant
 to this Agreement to such Lender or the Administrative Agent, as the case may
 be, which Taxes would not have been incurred or payable if such Participant
 had been a Non-U.S. Lender that was entitled to deliver to the Borrower, the
 Administrative Agent or such Lender, and did in fact so deliver, the
 applicable form or forms described in clause (e) of Section 4.6
 entitling such Participant to receive payments under this Agreement without
 deduction or withholding of any United States federal taxes.

	
 

	
 

	
 

	
          (g)
 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; 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.

	
 

	
 

	
 

	
          (h)
 In the event that S&P, Moody’s or Fitch shall, after the date that any
 Person becomes a Lender (other than a Lender party to this Agreement as of
 the Effective Date), downgrade the long-term certificate of deposit ratings
 of such Lender, and the

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resulting
ratings shall be below BBB, Baa2 or BBB respectively, or the equivalent, then
the Borrower shall have the right, but not the obligation, upon notice to
such Lender and the Administrative Agent, to replace such Lender with an
Eligible Assignee or a financial institution (a “Replacement Lender”)
acceptable to the Borrower and the Administrative Agent (such consents not to
be unreasonably withheld or delayed; provided that no such consent shall be
required if the Replacement Lender is an existing Lender), and upon any such
downgrading of any Lender’s long-term certificate of deposit rating, such
Lender hereby agrees to transfer and assign (in accordance with this Section)
all of its rights and obligations under the Loan Documents to such
Replacement Lender; provided that, (i) such assignment shall be without
recourse, representation or warranty (other than that such Lender owns the
Loans and Notes being assigned, free and clear of any Liens) and (ii) the
purchase price paid by the Replacement Lender shall be in the amount of such
Lender’s Loans, together with all accrued and unpaid interest and fees in
respect thereof, plus all other amounts (other than the amounts (if
any) demanded and unreimbursed under Sections 4.2 through (and
including) 4.6, which shall be paid by the Borrower), owing to such
Lender hereunder. Upon any such termination or assignment, such Lender shall
cease to be a party hereto but shall continue to be entitled to the benefits
of, and subject to the obligations of, any provisions of the Loan Documents
which by their terms survive the termination of this Agreement.  

	
 

	
 

	
 

	
SECTION
 10.12. Replacement of Lenders under Certain Circumstances.
 If at any time 

	
 

	
 

	
 

	
          (a)
 the Borrower becomes obligated to pay additional amounts described in Section
 4.3, 4.5 or 4.6 as a result of any condition described in
 such Sections or any Lender ceases to make LIBO Rate Loans, 

	
 

	
 

	
 

	
          (b)
 any Lender becomes insolvent and its assets become subject to a receiver,
 liquidator, trustee, custodian or other Person having similar powers, 

	
 

	
 

	
 

	
          (c)
 any Lender becomes a “Non-Consenting Lender” (as defined below in this Section
 10.12) or 

	
 

	
 

	
 

	
          (d)
 any Lender becomes a “Non-Funding Lender” (as defined below in this Section
 10.12), 

then, the
Borrower may, on ten Business Days’ prior written notice to the Administrative
Agent and such Lender, replace such Lender by causing such Lender to (and such
Lender shall be obligated to) assign pursuant to Section 10.11 all of
its rights and obligations under this Agreement to a Replacement Lender
selected by the Borrower and consented to (unless the selected Replacement
Lender is also an existing Lender) by the Administrative Agent (such consent
not to be unreasonably withheld or delayed for a purchase price equal to the
outstanding principal amount of such Lender’s Commitments and all accrued
interest and fees and other amounts payable hereunder; provided, however,
that (x) neither the Administrative Agent nor any Lender shall have any
obligation to the Borrower to find a replacement Lender or other such Person,
(y) in no event shall the Lender hereby replaced be required to pay or
surrender to such Replacement Lender or other Person any of the fees received
by such Lender hereby replaced 

-93-

pursuant to
this Agreement and (z) in the case of a replacement of a Lender to which the
Borrower becomes obligated to pay additional amounts to such Lender prior to
such Lender being replaced, the payment of such additional amounts shall be a
condition to the replacement of such Lender. Each Lender agrees that if it is
replaced pursuant to this Section, it shall execute and deliver to the
Administrative Agent a Lender Assignment Agreement to evidence such sale and
purchase and shall deliver to the Administrative Agent any Note (if the
assigning Lender’s Loans are evidenced by Notes) subject to such Lender
Assignment Agreement; provided, however, the failure of any
Lender replaced pursuant to this Section to execute a Lender Assignment
Agreement shall not render such sale and purchase (and the corresponding
assignment) invalid. In the event that (x) the Borrower or the Administrative
Agent has requested the Lenders to consent to a departure from, modification of
or waive of any provisions of the Load Documents or to agree to any amendment
thereto, (y) the consent, waiver or amendment in question requires the
agreement of Lenders (or the Lenders directly affected thereby) in accordance
with the terms of Section 10.1 and (z) 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”. If
any Lender has failed to make an advance required to be made by it hereunder or
(y) has given notice to the Borrower or the Administrative Agent that it will
not make, or that it has disaffirmed or repudiated any obligation to make, any
advance, such Lender will be deemed a “Non-Funding Lender”. The Borrower’s
right to replace a Non-Funding Lender pursuant to this Section is, and shall
be, in addition to, and not in lieu of, all other rights and remedies available
to the Borrower against such Non-Funding Lender under Applicable Law. 

          SECTION 10.13. Other
Transactions. Nothing contained
herein shall preclude the Administrative Agent or any other Lender from
engaging in any transaction, in addition to those contemplated by the Loan
Documents, with the Borrower or any of its Affiliates in which the Borrower or
such Affiliate is not restricted hereby from engaging with any other Person; PROVIDED,
HOWEVER, TO THE EXTENT THAT THERE IS ANY CONFLICT OR INCONSISTENCY
BETWEEN ANY PROVISION HEREOF, ON THE ONE HAND, AND ANY PROVISION OF ANY OTHER
AGREEMENT BETWEEN ANY LENDER AND THE BORROWER OR ANY OTHER OBLIGOR, ON THE OTHER
HAND, THIS AGREEMENT SHALL CONTROL. 

          SECTION 10.14. Forum Selection and
Consent to Jurisdiction.
ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH,
ANY LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE ADMINISTRATIVE AGENT, THE LENDERS
OR THE BORROWER IN CONNECTION HEREWITH OR THEREWITH MAY BE BROUGHT AND
MAINTAINED IN THE COURTS OF THE STATE OF NEW YORK OR IN THE UNITED STATES
DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK; PROVIDED, THAT, ANY SUIT
SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT
THE ADMINISTRATIVE AGENT’S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH
COLLATERAL OR OTHER PROPERTY MAY BE FOUND. THE BORROWER HEREBY EXPRESSLY AND
IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK,
NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN 

-94-

DISTRICT OF
NEW YORK FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET FORTH ABOVE AND
IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION
WITH SUCH LITIGATION. THE BORROWER IRREVOCABLY CONSENTS TO THE SERVICE OF
PROCESS BY REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT
THE STATE OF NEW YORK AT THE ADDRESS FOR NOTICES SPECIFIED IN SECTION 10.2. THE
BORROWER HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE OR HEREAFTER MAY HAVE TO THE
LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO
ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM. TO THE EXTENT THAT THE BORROWER HAS OR HEREAFTER MAY
ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS
(WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN
AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, THE
BORROWER HEREBY IRREVOCABLY WAIVES TO THE FULLEST EXTENT PERMITTED BY LAW SUCH IMMUNITY
IN RESPECT OF ITS OBLIGATIONS UNDER THE LOAN DOCUMENTS. 

          SECTION 10.15. Waiver of Jury
Trial. THE ADMINISTRATIVE
AGENT, EACH LENDER AND THE BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE TO THE FULLEST EXTENT PERMITTED BY LAW ANY RIGHTS THEY MAY
HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING
OUT OF, UNDER, OR IN CONNECTION WITH, EACH LOAN DOCUMENT, OR ANY COURSE OF
CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF
THE ADMINISTRATIVE AGENT, SUCH LENDER OR THE BORROWER IN CONNECTION THEREWITH.
THE BORROWER ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND SUFFICIENT
CONSIDERATION FOR THIS PROVISION (AND EACH OTHER PROVISION OF EACH OTHER LOAN
DOCUMENT TO WHICH IT IS A PARTY) AND THAT THIS PROVISION IS A MATERIAL
INDUCEMENT FOR THE ADMINISTRATIVE AGENT AND EACH LENDER ENTERING INTO THE LOAN
DOCUMENTS. 

          SECTION 10.16. Independence of
Covenants and Default
Provisions. All covenants and default provisions contained in this
Agreement or any other Loan Document shall be given independent effect such
that, in the event a particular action or condition is not permitted by any of
such covenants or default provisions, the fact that it would be permitted by an
exception to, or be otherwise within the limitations of, another covenant or
default provision shall not, unless expressly so provided in such first
covenant or default provision, avoid the occurrence of a Default or an Event of
Default if such action is taken or such condition exists. 

          SECTION 10.17. Counsel
Representation. THE BORROWER
ACKNOWLEDGES AND AGREES THAT IT HAS BEEN REPRESENTED BY COMPETENT COUNSEL IN
THE NEGOTIATION OF THIS AGREEMENT, AND THAT ANY RULE OR CONSTRUCTION OF LAW
ENABLING THE BORROWER TO ASSERT THAT ANY AMBIGUITIES OR INCONSISTENCIES IN THE
DRAFTING OR PREPARATION OF THE TERMS OF THIS 

-95-

AGREEMENT
SHOULD DIMINISH ANY RIGHTS OR REMEDIES OF THE ADMINISTRATIVE AGENT OR THE OTHER
SECURED PARTIES ARE HEREBY WAIVED BY THE BORROWER. 

          SECTION 10.18. PATRIOT Act
Notification. The following
notification is provided to the Borrower pursuant to Section 326 of the PATRIOT
Act: 

	
 

	
 

	
 

	
IMPORTANT
 INFORMATION ABOUT PROCEDURES FOR OPENING A NEW ACCOUNT. To help the
 government fight the funding of terrorism and money laundering activities,
 federal law requires all financial institutions to obtain, verify, and record
 information that identifies each person or entity that opens an account,
 including any deposit account, treasury management account, loan, other
 extension of credit, or other financial services product. What this means for
 the Borrower: When the Borrower opens an account, the Administrative Agent
 and the Lenders will ask for the Borrower’s name, tax identification number,
 business address, and other information that will allow the Administrative
 Agent and the Lenders to identify the Borrower. The Administrative Agent and
 the Lenders may also ask to see the Borrower’s legal organization documents
 or other identifying documents. 

          SECTION 10.19. Effect of Amendment
and Restatement of the
Existing Credit Agreement. On the Effective Date, the Existing Credit
Agreement shall be amended and restated in its entirety. The parties hereto
acknowledge and agree that (a) this Agreement and the other Loan Documents,
whether executed and delivered in connection herewith or otherwise, do not
constitute a novation or termination of the “Obligations” (as defined in the
Existing Credit Agreement) under the Existing Credit Agreement as in effect
immediately prior to the Effective Date and which remain outstanding and (b)
the “Obligations” (as amended and restated hereby and which are hereinafter
subject to the terms herein) are in all respects continuing. 

-96-

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

	
 

	
 

	
 

	
 

	
HECLA MINING
 COMPANY

	
 

	
 

	
 

	
By:

	
     /s/
 Lewis E. Walde

	
 

	
 

	
 

	
 

	
 

	
Name:
  Lewis E. Walde

	
 

	
 

	
Title:
    Vice President & CFO

	
 

	
 

	
 

	
 

	
THE BANK OF
 NOVA SCOTIA,

	
 

	
   as
 the Administrative Agent

	
 

	
 

	
 

	
By:

	
     /s/
 Robert Boomhour

	
 

	
 

	
 

	
 

	
 

	
Name:
  Robert Boomhour

	
 

	
 

	
Title:
    Director

	
 

	
 

	
 

	
 

	
THE BANK OF
 NOVA SCOTIA,

	
 

	
   as
 a Lender

	
 

	
 

	
 

	
By:

	
     /s/
 David Konarek

	
 

	
 

	
 

	
 

	
 

	
Name:
   David Konarek

	
 

	
 

	
Title:
     Managing Director

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
By:

	
     /s/
 Ray Clarke

	
 

	
 

	
 

	
 

	
 

	
Name:
  Ray Clarke

	
 

	
 

	
Title:
    Managing Director

EXHIBIT A-1 

FORM OF TERM I NOTE

	
 

	
 

	
$____________

	
____________ ___, 20___

          FOR
VALUE RECEIVED, HECLA MINING COMPANY, a Delaware corporation (the “Borrower”),
without setoff or counterclaim promises to pay to the order of [NAME OF LENDER]
(the “Lender”) on the Stated Maturity Date the principal sum of
___________________________ DOLLARS ($___________) or, if less, the aggregate
unpaid principal amount of all Loans made (or continued) by the Lender pursuant
to Section 2.1(a) of that certain Amended and Restated Credit Agreement, dated
as of April [__], 2008 (as amended, supplemented, amended and restated or
otherwise modified from time to time, the “Credit Agreement”), among the
Borrower, the various financial institutions and other Persons from time to
time parties thereto (including the Lender), The Bank of Nova Scotia, as the
Administrative Agent for the Lenders and Scotia Capital, as the Lead Arranger.
Terms used in this Note, unless otherwise defined herein, have the meanings
provided in the Credit Agreement. 

          The
Borrower also promises to pay interest on the unpaid principal amount hereof
from time to time outstanding from the date hereof until maturity (whether by
acceleration or otherwise) and, after maturity, until paid, at the rates per
annum and on the dates specified in the Credit Agreement. 

          Payments
of both principal and interest are to be made in Dollars in same day or
immediately available funds to the account designated by the Administrative
Agent pursuant to the Credit Agreement. 

          The
Borrower hereby irrevocably authorizes the Lender to make (or cause to be made)
appropriate notations on the grid attached to this Note (or on any continuation
of such grid), which notations, if made, shall evidence, inter alia, the
date of and the outstanding principal amount of the Loans evidenced thereby.
Such notations shall, to the extent not inconsistent with notations made by the
Administrative Agent in the Register, be presumptively accurate absent manifest
error; provided, however, that the failure of the Lender to make
any such notations shall not limit or otherwise affect any Obligations of the
Borrower. 

          This
Note is one of the Notes referred to in, and evidences Indebtedness incurred
under, the Credit Agreement, to which reference is made for a description of
the security for this Note and for a statement of the terms and conditions on
which the Borrower is permitted and required to make prepayments and repayments
of principal of the Indebtedness evidenced by this Note and on which such
Indebtedness may be declared to be immediately due and payable. 

          All
parties hereto, whether as makers, endorsers, or otherwise, severally waive
presentment for payment, demand, protest and notice of dishonor. 

          THIS NOTE HAS BEEN DELIVERED IN NEW YORK, NEW YORK AND
SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE
GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK). 

	
 

	
 

	
 

	
 

	
HECLA MINING
  COMPANY

	
 

	
 

	
 

	
By:

	
 

	
 

	
 

	 

	
 

	
 

	
Name:

	
 

	
 

	
Title:

Term I Note

LOANS AND PRINCIPAL PAYMENTS

	
            Date
  	
            Amount of Loan 
Made
  	
            Amount of Principal 
Repaid
  	
            Unpaid Principal
  Balance
  	
            Total
  	
            Notation 

Made By
  
	
             
 	
             
 	
             
 	
             
 	
             
 	
             
 
	
             
 	
             
 	
             
 	
             
 	
             
 	
             
 
	
             
 	
             
 	
             
 	
             
 	
             
 	
             
 
	
             
 	
             
 	
             
 	
             
 	
             
 	
             
 
	
             
 	
             
 	
             
 	
             
 	
             
 	
             
 
	
             
 	
             
 	
             
 	
             
 	
             
 	
             
 
	
             
 	
             
 	
             
 	
             
 	
             
 	
             
 
	
             
 	
             
 	
             
 	
             
 	
             
 	
             
 
	
             
 	
             
 	
             
 	
             
 	
             
 	
             
 

EXHIBIT A-2 

FORM OF TERM II NOTE

	
 

	
 

	
$____________

	
____________ ___, 20___

          FOR
VALUE RECEIVED, HECLA MINING COMPANY, a Delaware corporation (the “Borrower”),
without setoff or counterclaim promises to pay to the order of [NAME OF LENDER]
(the “Lender”) on the Stated Maturity Date the principal sum of up to
___________________________ DOLLARS ($___________) or, if less, the aggregate
unpaid principal amount of all Loans made (or continued) by the Lender pursuant
to Section 2.1(b) of that certain Amended and Restated Credit Agreement, dated
as of April [__], 2008 (as amended, supplemented, amended and restated or
otherwise modified from time to time, the “Credit Agreement”), among the
Borrower, the various financial institutions and other Persons from time to
time parties thereto (including the Lender), The Bank of Nova Scotia, as the
Administrative Agent for the Lenders and Scotia Capital, as the Lead Arranger.
Terms used in this Note, unless otherwise defined herein, have the meanings
provided in the Credit Agreement. 

          The
Borrower also promises to pay interest on the unpaid principal amount hereof
from time to time outstanding from the date hereof until maturity (whether by acceleration
or otherwise) and, after maturity, until paid, at the rates per annum and on
the dates specified in the Credit Agreement. 

          Payments
of both principal and interest are to be made in Dollars in same day or
immediately available funds to the account designated by the Administrative
Agent pursuant to the Credit Agreement. 

          The
Borrower hereby irrevocably authorizes the Lender to make (or cause to be made)
appropriate notations on the grid attached to this Note (or on any continuation
of such grid), which notations, if made, shall evidence, inter alia,
the date of and the outstanding principal amount of the Loans evidenced
thereby. Such notations shall, to the extent not inconsistent with notations
made by the Administrative Agent in the Register, be presumptively accurate
absent manifest error; provided, however, that the failure of the
Lender to make any such notations shall not limit or otherwise affect any
Obligations of the Borrower. 

          This
Note is one of the Notes referred to in, and evidences Indebtedness incurred
under, the Credit Agreement, to which reference is made for a description of
the security for this Note and for a statement of the terms and conditions on
which the Borrower is permitted and required to make prepayments and repayments
of principal of the Indebtedness evidenced by this Note and on which such
Indebtedness may be declared to be immediately due and payable. 

          All
parties hereto, whether as makers, endorsers, or otherwise, severally waive
presentment for payment, demand, protest and notice of dishonor. 

          THIS NOTE HAS BEEN DELIVERED IN NEW YORK, NEW YORK AND
SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE
GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK). 

	
 

	
 

	
 

	
 

	
HECLA MINING
  COMPANY

	
 

	
 

	
 

	
By:

	
 

	
 

	
 

	 

	
 

	
 

	
Name:

	
 

	
 

	
Title:

Term II Note

LOANS AND PRINCIPAL PAYMENTS

	
            Date
  	
            Amount of Loan 
Made
  	
            Amount of Principal 
Repaid
  	
            Unpaid Principal
  Balance
  	
            Total
  	
            Notation 

Made By
  
	
             
 	
             
 	
             
 	
             
 	
             
 	
             
 
	
             
 	
             
 	
             
 	
             
 	
             
 	
             
 
	
             
 	
             
 	
             
 	
             
 	
             
 	
             
 
	
             
 	
             
 	
             
 	
             
 	
             
 	
             
 
	
             
 	
             
 	
             
 	
             
 	
             
 	
             
 
	
             
 	
             
 	
             
 	
             
 	
             
 	
             
 
	
             
 	
             
 	
             
 	
             
 	
             
 	
             
 
	
             
 	
             
 	
             
 	
             
 	
             
 	
             
 
	
             
 	
             
 	
             
 	
             
 	
             
 	
             
 

EXHIBIT F

FORM OF SUBSIDIARY GUARANTY

          This
SUBSIDIARY GUARANTY (as amended, supplemented, amended and restated or
otherwise modified from time to time, this “Guaranty”), dated as of
_____________, 200_, is made by each U.S. Subsidiary of HECLA MINING COMPANY, a
Delaware corporation (the “Borrower”) party hereto (each individually a
“Guarantor” and collectively, the “Guarantors”) in favor of THE
BANK OF NOVA SCOTIA, as administrative agent (together with its successor(s)
thereto in such capacity, the “Administrative Agent”) for each of the
Secured Parties (capitalized terms used herein have the meanings set forth in
or incorporated by reference in Article I). 

W I T N
E S S E T H:

          WHEREAS,
pursuant to an Amended and Restated Credit Agreement, dated as of April [_],
2008 (as amended, supplemented, amended and restated, extended or otherwise
modified from time to time, the “Credit Agreement”), among the Borrower,
the Lenders, the Administrative Agent and Scotia Capital, as the Lead Arranger,
the Lenders have extended Commitments to make Credit Extensions to the
Borrower; and 

          WHEREAS,
as a condition precedent to the making of the Credit Extensions under the
Credit Agreement, each Guarantor is required to execute and deliver this Guaranty.

          NOW,
THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged and in order to induce the Lenders to make Credit
Extensions to the Borrower, and to induce Secured Parties to enter into Lender
Hedging Agreements and other Loan Documents, each Guarantor jointly and
severally agrees, for the benefit of each Secured Party, as follows: 

ARTICLE XI

DEFINITIONS

          SECTION
11.1.Certain Terms. The following terms (whether or not underscored) when used
in this Guaranty, including its preamble and recitals, shall have the following
meanings (such definitions to be equally applicable to the singular and plural
forms thereof):  

          “Administrative
Agent” is defined in the preamble.

          “Borrower”
is defined in the preamble. 

          “Credit
Agreement” is defined in the first recital. 

          “Guarantor”
and “Guarantors” are defined in the preamble. 

          “Guaranty”
is defined in the preamble. 

          “Loan
Documents” means the Loan Documents, as defined in the Credit Agreement,
together with (except for purposes of Article V) the following: Lender
Hedging Agreements and each other agreement which evidences an Obligation or
under which an Obligation arises. 

          SECTION
11.2. Credit Agreement Definitions. Unless otherwise defined herein or
the context otherwise requires, terms used in this Guaranty, including its
preamble and recitals, have the meanings provided in the Credit Agreement. 

ARTICLE XII

GUARANTY PROVISIONS

          SECTION
12.1. Guaranty. Each Guarantor hereby jointly and severally absolutely,
unconditionally and irrevocably: 

          SECTION
12.1.1. guarantees the full and punctual payment when due, whether at stated
maturity, by required prepayment, declaration, acceleration, demand or
otherwise, of all Obligations of each Obligor now or hereafter existing,
whether for principal, interest (including interest accruing at the then
applicable rate provided in the Credit Agreement after the occurrence of any
Default set forth in Section 8.1.9 of the Credit Agreement, whether or not a
claim for post-filing or post-petition interest is allowed under applicable law
following the institution of a proceeding under bankruptcy, insolvency or
similar laws), fees, expenses (including all such amounts which would become
due but for the operation of the automatic stay under Section 362(a) of the
United States Bankruptcy Code, 11 U.S.C. §362(a), and the operation of Sections
502(b) and 506(b) of the United States Bankruptcy Code, 11 U.S.C. §502(b) and
§506(b)); and 

          SECTION
12.1.2. indemnifies and holds harmless each Secured Party for any and all costs
and expenses (including reasonable attorneys’ fees and expenses) incurred by
such Secured Party in enforcing any rights under this Guaranty; provided,
however, that each Guarantor shall only be liable under this Guaranty
for the maximum amount of such liability that can be hereby incurred without
rendering this Guaranty voidable under applicable law relating to fraudulent
conveyance or fraudulent transfer, and not for any greater amount. This
Guaranty constitutes a guaranty of payment when due and not of collection, and
each Guarantor specifically agrees that it shall not be necessary or required
that any Secured Party exercise any right, assert any claim or demand or
enforce any remedy whatsoever against any Obligor or any other Person before or
as a condition to the obligations of such Guarantor hereunder. 

          SECTION
12.2. Reinstatement, etc. Each Guarantor hereby jointly and severally
agrees that this Guaranty shall continue to be effective or be reinstated, as
the case may be, if at any time any payment (in whole or in part) of any of the
Obligations is invalidated, declared to be fraudulent or preferential, set
aside, rescinded or must otherwise be restored by any Secured Party, including
upon the occurrence of any Default set forth in Section 8.1.9 of the Credit
Agreement or otherwise, all as though such payment had not been made. 

          SECTION
12.3. Guaranty Absolute, etc. This Guaranty shall in all respects be a
continuing, absolute, unconditional and irrevocable guaranty of payment, and
shall remain in full force and effect until the Termination Date has occurred.
Each Guarantor jointly and severally guarantees that the Obligations will be
paid strictly in accordance with the terms of each Loan Document under which
they arise, regardless of any law, regulation or order now or hereafter in
effect in any jurisdiction affecting any of such terms or the rights of any
Secured Party with 

respect
thereto. The liability of each Guarantor under this Guaranty shall be joint and
several, absolute, unconditional and irrevocable irrespective of: 

          SECTION
12.3.1. any lack of validity, legality or enforceability of any Loan Document; 

          SECTION
12.3.2. the failure of any Secured Party 

          (a)
to assert any claim or demand or to enforce any right or remedy against any
Obligor or any other Person (including any other guarantor) under the provisions
of any Loan Document or otherwise, or 

          (b)
to exercise any right or remedy against any other guarantor of, or collateral
securing, any Obligations; 

          SECTION
12.3.3. any change in the time, manner or place of payment of, or in any other
term of, all or any part of the Obligations, or any other extension, compromise
or renewal of any Obligation; 

          SECTION
12.3.4. any reduction, limitation, impairment or termination of any Obligations
for any reason, including any claim of waiver, release, surrender, alteration
or compromise, and shall not be subject to (and each Guarantor hereby waives
any right to or claim of) any defense or setoff, counterclaim, recoupment or
termination whatsoever by reason of the invalidity, illegality, nongenuineness,
irregularity, compromise, unenforceability of, or any other event or occurrence
affecting, any Obligations or otherwise; 

          SECTION
12.3.5. any amendment to, rescission, waiver, or other modification of, or any
consent to or departure from, any of the terms of any Loan Document; 

          SECTION
12.3.6. any addition, exchange or release of any collateral or of any Person
that is (or will become) a guarantor of the Obligations, or any surrender or
non-perfection of any collateral, or any amendment to or waiver or release or
addition to, or consent to or departure from, any other guaranty held by any
Secured Party securing any of the Obligations; or 

          SECTION
12.3.7. any other circumstance which might otherwise constitute a defense
available to, or a legal or equitable discharge of, any Obligor, any surety or
any guarantor. 

          SECTION
12.4. Setoff. Each Guarantor hereby irrevocably authorizes the
Administrative Agent and each other Secured Party, without the requirement that
any notice be given to such Guarantor (such notice being expressly waived by
each Guarantor), upon the occurrence and during the continuance of any Default
described in Section 8.1.9 of the Credit Agreement or, with the consent of the
Required Lenders, upon the occurrence and during the continuance of any other
Event of Default, to set-off and appropriate and apply to the payment of the
Obligations (whether or not then due, and whether or not any Secured Party has
made any demand for payment of the Obligations), any and all balances, credits,
deposits, accounts or moneys of such Guarantor then or thereafter maintained
with such Secured Party; provided, however, that any such
appropriation and application shall be subject to the provisions of Section 4.8
of the Credit Agreement. Each Secured Party agrees to notify the applicable
Guarantor and the Administrative Agent after any such setoff and application
made by such Secured Party; 

provided further, however, that
the failure to give such notice shall not affect the validity of such setoff
and application. The rights of each Secured Party under this Section are in
addition to other rights and remedies (including other rights of setoff under
applicable law or otherwise) which such Secured Party may have. 

          SECTION
12.5. Waiver, etc. Each Guarantor hereby waives promptness, diligence,
notice of acceptance and any other notice with respect to any of the
Obligations and this Guaranty and any requirement that any Secured Party
secure, perfect or insure any Lien, or any property subject thereto, or exhaust
any right or take any action against any Obligor or any other Person (including
any other guarantor) or entity or any collateral securing the Obligations, as
the case may be. 

          SECTION
12.6. Postponement of Subrogation, etc. Each Guarantor agrees that it
will not exercise any rights which it may acquire by way of rights of
subrogation under any Loan Document to which it is a party, nor shall any
Guarantor seek or be entitled to seek any contribution or reimbursement from
any Obligor, in respect of any payment made under any Loan Document or
otherwise, until following the Termination Date. Any amount paid to any
Guarantor on account of any such subrogation rights prior to the Termination Date
shall be held in trust for the benefit of the Secured Parties and shall
immediately be paid and turned over to the Administrative Agent for the benefit
of the Secured Parties in the exact form received by such Guarantor (duly
endorsed in favor of the Administrative Agent, if required), to be credited and
applied against the Obligations, whether matured or unmatured, in accordance
with Section 2.7; provided, however, that if any Guarantor
has made payment to the Secured Parties of all or any part of the Obligations
and the Termination Date has occurred, then at such Guarantor’s request, the
Administrative Agent (on behalf of the Secured Parties) will, at the expense of
such Guarantor, execute and deliver to such Guarantor appropriate documents
(without recourse and without representation or warranty) necessary to evidence
the transfer by subrogation to such Guarantor of an interest in the Obligations
resulting from such payment. In furtherance of the foregoing, at all times
prior to the Termination Date, each Guarantor shall refrain from taking any
action or commencing any proceeding against any Obligor (or its successors or
assigns, whether in connection with a bankruptcy proceeding or otherwise) to
recover any amounts in respect of payments made under this Guaranty to any
Secured Party. 

          SECTION
12.7. Payments; Application. Each Guarantor hereby agrees with each
Secured Party that: 

          SECTION
12.7.1. all payments made by such Guarantor hereunder will be made in Dollars
to the Administrative Agent, without set-off, counterclaim or other defense and
in accordance with Sections 4.6 and 4.7 of the Credit Agreement, free and clear
of and without deduction for any Taxes, each Guarantor hereby agreeing to
comply with and be bound by the provisions of Sections 4.6 and 4.7 of the
Credit Agreement in respect of all payments made by it hereunder and the
provisions of which Sections are hereby incorporated into and made a part of
this Guaranty by this reference as if set forth herein; provided, that
references to the “Borrower” in such Sections shall be deemed to be references
to each Guarantor, and references to “this Agreement” in such Sections shall be
deemed to be references to this Guaranty; and 

          SECTION
12.7.2. all payments made hereunder shall be applied upon receipt as set forth
in Section 4.7 of the Credit Agreement. 

ARTICLE XIII 

REPRESENTATIONS AND WARRANTIES

          In
order to induce the Secured Parties to enter into the Credit Agreement and make
Credit Extensions thereunder and to induce the Secured Parties to enter into
Lender Hedging Agreements and other Loan Documents, each Guarantor represents
and warrants to each Secured Party as set forth below. 

          SECTION
13.1. Credit Agreement Representations and Warranties. The representations
and warranties contained in Article VI of the Credit Agreement (as of the dates
required to be made under the Credit Agreement), insofar as the representations
and warranties contained therein are applicable to such Guarantor and its properties
(and, following the Transfer Date, the Greens Creek Joint Venture and its
properties), are true and correct in all material respects, each such
representation and warranty set forth in such Article (insofar as applicable as
aforesaid) and all other terms of the Credit Agreement to which reference is
made therein, together with all related definitions and ancillary provisions,
being hereby incorporated into this Guaranty by this reference as though
specifically set forth in this Article. 

          SECTION
13.2. Financial Condition, etc. Each Guarantor has knowledge of each
other Obligor’s financial condition and affairs and that it has adequate means
to obtain from each such Obligor on an ongoing basis information relating
thereto and to such Obligor’s ability to pay and perform the Obligations, and
agrees to assume the responsibility for keeping, and to keep, so informed for
so long as this Guaranty is in effect. Each Guarantor acknowledges and agrees
that the Secured Parties shall have no obligation to investigate the financial
condition or affairs of any Obligor for the benefit of such Guarantor nor to
advise such Guarantor of any fact respecting, or any change in, the financial
condition or affairs of any other Obligor that might become known to any Secured
Party at any time, whether or not such Secured Party knows or believes or has
reason to know or believe that any such fact or change is unknown to such
Guarantor, or might (or does) materially increase the risk of such Guarantor as
guarantor, or might (or would) affect the willingness of such Guarantor to
continue as a guarantor of the Obligations. 

          SECTION
13.3. Best Interests. It is in the best interests of each Guarantor to
execute this Guaranty in as much as such Guarantor will, as a result of being a
Subsidiary of the Borrower, derive substantial direct and indirect benefits
from the Credit Extensions made from time to time to the Borrower by the
Lenders pursuant to the Credit Agreement and the execution and delivery of
Lender Hedging Agreements and other Loan Documents between the Borrower and
certain Secured Parties, and each Guarantor agrees that the Secured Parties are
relying on this representation in agreeing to make Credit Extensions to the
Borrower. 

ARTICLE XIV

COVENANTS, ETC.

          Each
Guarantor covenants and agrees that, at all times prior to the Termination
Date, it will perform, comply with and be bound by all of the agreements,
covenants and obligations contained in the Credit Agreement (including Article
VII and Section 8.1.9 of the Credit Agreement) which are applicable to such
Guarantor and the Greens Creek Joint Venture, or their respective properties,
each such agreement, covenant and obligation contained in the Credit Agreement
and all other terms of the Credit Agreement to which reference is made in this
Article, together with all related definitions and ancillary provisions, being
hereby incorporated into this Guaranty by this reference as though specifically
set forth in this Article. 

ARTICLE XV

MISCELLANEOUS PROVISIONS

          SECTION
15.1. Loan Document. This Guaranty is a Loan Document executed pursuant
to the Credit Agreement and shall (unless otherwise expressly indicated herein)
be construed, administered and applied in accordance with the terms and provisions
thereof, including Article X thereof. 

          SECTION
15.2. Binding on Successors, Transferees and Assigns; Assignment. This
Guaranty shall remain in full force and effect until the Termination Date has
occurred, shall be jointly and severally binding upon each Guarantor and its
successors, transferees and assigns and shall inure to the benefit of and be
enforceable by each Secured Party and its successors, transferees and assigns; provided,
however, that no Guarantor may (unless otherwise permitted under the
terms of the Credit Agreement) assign any of its obligations hereunder without
the prior written consent of all Lenders. 

          SECTION
15.3. Amendments, etc. No amendment to or waiver of any provision of
this Guaranty, nor consent to any departure by any Guarantor from its
obligations under this Guaranty, shall in any event be effective unless the
same shall be in writing and signed by the Administrative Agent (on behalf of
the Lenders or the Required Lenders, as the case may be, pursuant to Section
10.1 of the Credit Agreement) and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given. 

          SECTION
15.4. Notices. All notices and other communications provided for hereunder
shall be in writing or by facsimile and addressed, delivered or transmitted to
the appropriate party at the address or facsimile number of such party (in the
case of any Guarantor, in care of the Borrower) specified in the Credit
Agreement or at such other address or facsimile number as may be designated by
such party in a notice to the other party. Any notice, if mailed and properly
addressed with postage prepaid or if properly addressed and sent by pre-paid
courier service, shall be deemed given when received; any such notice, if
transmitted by facsimile, shall be deemed given when the confirmation of
transmission thereof is received by the transmitter. 

          SECTION
15.5. Additional Subsidiary Guarantors. Upon the execution and delivery
by any other Person of a supplement in the form of Annex I hereto, such
Person shall become a “Guarantor” hereunder with the same force and effect as
if it were originally a party to this 

Guaranty and
named as a “Guarantor” hereunder. The execution and delivery of such supplement
shall not require the consent of any other Guarantor hereunder, and the rights
and obligations of each Guarantor hereunder shall remain in full force and
effect notwithstanding the addition of any new Guarantor as a party to this
Guaranty. 

          SECTION
15.6. Release of Guarantors. Upon the occurrence of the Termination
Date, this Guaranty and all obligations of each Guarantor hereunder shall
terminate, without delivery of any instrument or performance of any act by any
party. A Guarantor shall automatically be released from its obligations
hereunder upon the consummation of any transaction permitted by the Credit
Agreement as a result of which such Guarantor ceases to be a Subsidiary of the
Borrower and any of its Subsidiaries. 

          SECTION
15.7. No Waiver; Remedies. In addition to, and not in limitation of, Sections
2.3 and 2.5, no failure on the part of any Secured Party to
exercise, and no delay in exercising, any right hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any right hereunder
preclude any other or further exercise thereof or the exercise of any other
right. The remedies herein provided are cumulative and not exclusive of any
remedies provided by law. 

          SECTION
15.8. Section Captions. Section captions used in this Guaranty are for
convenience of reference only, and shall not affect the construction of this
Guaranty. 

          SECTION
15.9. Severability. Wherever possible each provision of this Guaranty
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Guaranty shall be prohibited by or
invalid under such law, such provision shall be ineffective to the extent of
such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Guaranty. 

          SECTION
15.10. Governing Law. THIS GUARANTY WILL BE DEEMED TO BE A CONTRACT MADE
UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING FOR
SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE
STATE OF NEW YORK). 

          SECTION
15.11. Forum Selection and Consent to Jurisdiction. ANY LITIGATION BASED
HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, ANY LOAN DOCUMENT, OR
ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN)
OR ACTIONS OF THE ADMINISTRATIVE AGENT, THE SECURED PARTIES OR EACH GUARANTOR
IN CONNECTION HEREWITH OR THEREWITH MAY BE BROUGHT AND MAINTAINED IN THE COURTS
OF THE STATE OF NEW YORK OR IN THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF NEW YORK; PROVIDED, HOWEVER, THAT ANY SUIT
SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT
THE ADMINISTRATIVE AGENT’S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH
COLLATERAL OR OTHER PROPERTY MAY BE FOUND. EACH GUARANTOR IRREVOCABLY CONSENTS
TO THE SERVICE OF PROCESS BY REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL
SERVICE WITHIN OR 

WITHOUT THE
STATE OF NEW YORK AT THE ADDRESS FOR NOTICES SPECIFIED FOR THE BORROWER IN
SECTION 10.2 OF THE CREDIT AGREEMENT. EACH GUARANTOR HEREBY EXPRESSLY AND
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH
IT MAY HAVE OR HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION
BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH
LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT THAT ANY
GUARANTOR HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT
OR FROM ANY LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR
TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO
ITSELF OR ITS PROPERTY, SUCH GUARANTOR HEREBY IRREVOCABLY WAIVES TO THE FULLEST
EXTENT PERMITTED BY LAW SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THE
LOAN DOCUMENTS. 

          SECTION
15.12. Waiver of Jury Trial. THE ADMINISTRATIVE AGENT (ON BEHALF OF
ITSELF AND EACH OTHER SECURED PARTY) AND EACH GUARANTOR HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE TO THE FULLEST EXTENT PERMITTED BY LAW ANY
RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED
HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, EACH LOAN DOCUMENT, OR
ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN)
OR ACTIONS OF THE ADMINISTRATIVE AGENT, SUCH SECURED PARTY OR EACH GUARANTOR IN
CONNECTION THEREWITH. EACH GUARANTOR ACKNOWLEDGES AND AGREES THAT IT HAS
RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION (AND EACH OTHER
PROVISION OF EACH OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY) AND THAT THIS
PROVISION IS A MATERIAL INDUCEMENT FOR THE ADMINISTRATIVE AGENT AND EACH
SECURED PARTY ENTERING INTO THE LOAN DOCUMENTS. 

          SECTION
15.13. Counterparts. This Guaranty may be executed by the parties hereto
in several counterparts, each of which shall be deemed to be an original and
all of which shall constitute together but one and the same agreement. Delivery
of an executed counterpart of a signature page to this Guaranty by facsimile
shall be effective as delivery of an original executed counterpart of this
Guaranty. 

          IN
WITNESS WHEREOF, the Guarantors has caused this Guaranty to be duly executed
and delivered by its Authorized Officer as of the date first above written. 

	
 

	
 

	
 

	
 

	
HECLA ALASKA
  LLC

	
 

	
 

	
 

	
 

	
By:

	
Hecla
  Limited,

	
 

	
 

	
its Managing
  Member

	
 

	
 

	
 

	
 

	
By:

	
 

	
 

	
 

	

	
 

	
 

	
Name:

	
 

	
 

	
Title:

	
 

	
 

	
 

	
 

	
HECLA
  LIMITED

	
 

	
 

	
 

	
 

	
By:

	
 

	
 

	
 

	

	
 

	
 

	
Name:

	
 

	
 

	
Title:

	
 

	
 

	
 

	
 

	
HECLA
  ADMIRALTY COMPANY

	
 

	
 

	
 

	
 

	
By:

	
 

	
 

	
 

	

	
 

	
 

	
Name:

	
 

	
 

	
Title:

Subsidiary Guaranty

ACCEPTED AND
AGREED FOR ITSELF

AND ON BEHALF OF THE SECURED PARTIES: 

	
 

	
 

	
 

	
 

	
THE BANK OF
  NOVA SCOTIA,

	
 

	
as
  Administrative Agent

	
 

	
 

	
 

	
 

	
By:

	
 

	
 

	
 

	

	
 

	
 

	
Name:

	
 

	
 

	
Title:

Subsidiary Guaranty 

ANNEX I to

the Subsidiary Guaranty 

          THIS
SUPPLEMENT, dated as of [DATE]
(this “Supplement”), is to the Subsidiary Guaranty, dated as of April
[__], 2008 (as amended, supplemented, amended and restated or otherwise
modified from time to time, the “Guaranty”), among the Guarantors (such
capitalized term, and other terms used in this Supplement, to have the meanings
set forth in Article I of the Guaranty) from time to time party thereto, in
favor of the Administrative Agent for each of the Secured Parties. 

W I T N
E S S E T H:

          WHEREAS,
pursuant to the provisions of Section 5.5 of the Guaranty, the
undersigned is becoming a Guarantor under the Guaranty; and 

          WHEREAS,
the undersigned Guarantor desires to become a “Guarantor” under the Guaranty in
order to induce the Secured Parties to continue to extend Credit Extensions
under the Credit Agreement; 

          NOW,
THEREFORE, in consideration of the premises, and for other consideration (the
receipt and sufficiency of which is hereby acknowledged), the undersigned
agrees, for the benefit of each Secured Party, as follows. 

          SECTION
1. Party to Guaranty, etc. In accordance with the terms of the Guaranty,
by its signature below, the undersigned hereby irrevocably agrees to become a
Guarantor under the Guaranty with the same force and effect as if it were an
original signatory thereto and the undersigned hereby (a) jointly and severally
with the other Guarantors, unconditionally and irrevocably guarantees the
prompt and complete payment and performance when due (whether at the stated
maturity by acceleration or otherwise) of all Obligations of each Obligor as
more fully set forth in the Guaranty, (b) agrees to be bound by and comply with
all of the terms and provisions of the Guaranty applicable to it as a Guarantor
and (c) represents and warrants that the representations and warranties made by
it as a Guarantor thereunder are true and correct as of the date hereof (except
to the extent such representation or warranty applies to an earlier date). In
furtherance of the foregoing, each reference to a “Guarantor” and/or
“Guarantors” in the Guaranty shall be deemed to include the undersigned. 

          SECTION
2. Representations. The undersigned Guarantor hereby represents and
warrants that this Supplement has been duly authorized, executed and delivered
by it and that this Supplement and the Guaranty constitute the legal, valid and
binding obligation of the undersigned Guarantor, enforceable against it in
accordance with its terms. 

          SECTION
3. Full Force of Guaranty. Except as expressly supplemented hereby, the
Guaranty shall remain in full force and effect in accordance with its terms. 

          SECTION
4. Severability. Wherever possible each provision of this Supplement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Supplement shall be prohibited by
or invalid under such law, such provision 

shall be
ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of
this Supplement or the Guaranty. 

          SECTION
5. Governing Law. THIS SUPPLEMENT SHALL BE
DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE
STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE
GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK).  

          SECTION
6. Counterparts. This Supplement may be executed by the parties hereto
in several counterparts, each of which shall be deemed to be an original and
all of which shall constitute together but one and the same agreement. Delivery
of an executed counterpart of a signature page to this Guaranty by facsimile or
via other electronic means shall be effective as delivery of a manually
executed counterpart of this Guaranty. 

          IN
WITNESS WHEREOF, the undersigned Guarantor has caused this Supplement to be
duly executed and delivered by its Authorized Officer as of the date first
above written. 

	
 

	
 

	
 

	
 

	
 

	
[NAME OF ADDITIONAL SUBSIDIARY GUARANTOR]

	
 

	
By: 

	 

	
 

	
 

	
Title:

	
 

	
 

	
 

	
ACCEPTED BY:

	
 

	
 

	
 

	
 

	
THE BANK OF
 NOVA SCOTIA,

	
 

	
as Administrative Agent

	
 

	
 

	
 

	
 

	
By:

	 

	
 

	
 

	
Title:

	
 

EXHIBIT G 

FORM OF AMENDED AND RESTATED PLEDGE AGREEMENT

          This
AMENDED AND RESTATED PLEDGE AGREEMENT, dated as of ____________, 200_ (as
amended, supplemented, amended and restated or otherwise modified from time to
time, this “Pledge Agreement”), is made by HECLA MINING COMPANY, a
Delaware corporation (the “Borrower”), and each Subsidiary (terms used
in the preamble and the recitals have the definitions set forth in or
incorporated by reference in Article I) from time to time a party to
this Pledge Agreement (each individually a “Pledgor” and collectively,
the “Pledgors”), in favor of THE BANK OF NOVA SCOTIA, as the
administrative agent (together with its successor(s) thereto in such capacity,
the “Administrative Agent”) for each of the Secured Parties. This Pledge
Agreement amends and restates in its entirety the Borrower Pledge Agreement,
dated September 12, 2005, between the Borrower and the Administrative Agent, as
amended, supplemented, amended and restated or otherwise modified from time to time
prior to the date hereof, and continues the security interest granted
thereunder to the extent set forth herein. 

W I T N E S S E T H:

          WHEREAS,
pursuant to an Amended and Restated Credit Agreement, dated as of April [__],
2008 (as amended, supplemented, amended and restated, extended or otherwise
modified from time to time, the “Credit Agreement”), among the Borrower,
the various financial institutions and other Persons from time to time party
thereto, the Administrative Agent and Scotia Capital, as the Lead Arranger, the
Lenders have extended Commitments to make Credit Extensions to the Borrower;
and 

          WHEREAS,
as a condition precedent to the making of the Credit Extensions under the
Credit Agreement, each Pledgor is required to execute and deliver this Pledge
Agreement. 

          NOW,
THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, and in order to induce the Lenders to make
Credit Extensions to the Borrower, and to induce Secured Parties to enter into
Lender Hedging Agreements and other Loan Documents, each Pledgor agrees, for
the benefit of each Secured Party, as follows: 

ARTICLE I

DEFINITIONS

          SECTION
1.1. Certain Terms. The following terms (whether or not underscored), when
used in this Pledge Agreement, including its preamble and recitals, shall have
the following meanings (such definitions to be equally applicable to the
singular and plural forms thereof): 

          “Administrative
Agent” is defined in the preamble.

          “Borrower”
is defined in the preamble.

          “Collateral”
is defined in Section 2.1. 

          “Collateral
Account” is defined in clause (a) of Section 4.2.

          “Credit
Agreement” is defined in the first recital. 

          “Distributions”
means, with respect to each Subsidiary the Capital Securities of which are
pledged hereunder, all distributions or other payments, whether in cash,
securities or property, by such Subsidiary to each Pledgor. 

          “Loan
Documents” means the Loan Documents, as defined in the Credit Agreement,
together with (except for purposes of Article V) the following: Lender
Hedging Agreements and each other agreement which evidences an Obligation or
under which an Obligation arises. 

          “Permitted
Liens” means all Liens permitted by clause (a), clause (h) or clause (j) of
Section 7.2.3 of the Credit Agreement. 

          “Pledge
Agreement” is defined in the preamble. 

          “Pledgor”
and “Pledgors” are defined in the preamble. 

          “Specified
Default” means the occurrence and continuance of (a) an Event of Default or
(b) a Default under clauses (a) through (d) of Section 8.1.9 of the Credit
Agreement. 

          SECTION
1.2. Credit Agreement Definitions. Unless otherwise defined herein or
the context otherwise requires, terms used in this Pledge Agreement, including
its preamble and recitals, have the meanings provided in the Credit Agreement. 

          SECTION
1.3. UCC Definitions. When used herein the terms Account, Certificated
Securities, Chattel Paper, Document, General Intangibles, Instrument,
Investment Property, Payment Intangibles, Proceeds, Promissory Notes and
Securities Accounts have the meaning provided in Article 8 or Article 9, as
applicable, of the UCC. 

ARTICLE II

SECURITY INTEREST

          SECTION
2.1. Grant of Security Interest. Each Pledgor hereby grants to the
Administrative Agent, for its benefit and the ratable benefit of each other
Secured Party, a continuing security interest in all of such Pledgor’s
following property, whether now or hereafter existing, owned or acquired by
such Pledgor, and wherever located, (collectively, the “Collateral”): 

	
 

	
 

	
 

	
          (a) Investment Property consisting of the Capital Securities of each Material
  Subsidiary of such Pledgor;

	
 

	
 

	
 

	
          (b) all Accounts, Chattel Paper, Documents, Instruments, Promissory Notes and
  Payment Intangibles of each Pledgor, now existing or hereafter arising, from
  loans, advances or other extensions of credit made by each Pledgor from time
  to time to, or for the account of, each other Obligor;

	
 

	
 

	
 

	
          (c)
  all Accounts, Chattel Paper, Documents, Instruments, Promissory Notes and
  Payment Intangibles of the Borrower, now existing or hereafter arising, from
  Hedging Agreements entered into by the Borrower from time to time; 

	
 

	
 

	
 

	
          (d)
  all of the right, title and interest of the Borrower and Hecla Admiralty in
  the Acquisition Agreement and the Kennecott Guaranty (as defined in the
  Acquisition Agreement) provided by Kennecott Holdings Corporation in favor of
  the Borrower pursuant to the Acquisition Agreement; and 

	
 

	
 

	
 

	
          (e)
  all Proceeds of the foregoing and, to the extent not otherwise included, all
  payments under insurance (whether or not the Administrative Agent is the loss
  payee thereof). 

Notwithstanding
the foregoing, the term “Collateral” shall not include: 

	
 

	
 

	
 

	
          (i)
  any General Intangibles or other rights arising under any contracts,
  instruments, licenses or other documents as to which the grant of a security
  interest would (A) constitute a violation of a valid and enforceable
  restriction in favor of a third party on such grant, unless and until any
  required consents shall have been obtained, or (B) give any other party to
  such contract, instrument, license or other document a valid and enforceable
  right to terminate its obligations thereunder; 

	
 

	
 

	
 

	
          (ii)
  any asset, the granting of a security interest in which would be void or
  illegal under any applicable governmental law, rule or regulation, or
  pursuant thereto would result in, or permit the termination of, such asset;
  or 

	
 

	
 

	
 

	
          (iii)
  Investment Property consisting of Capital Securities of a Foreign Subsidiary
  of such Pledgor (A) in excess of 65% of the Voting Securities of each such
  Foreign Subsidiary, except that such 65% limitation shall not apply to a
  Foreign Subsidiary that (x) is treated as a partnership under the Code or (y)
  is not treated as an entity that is separate from (A) such Pledgor; (B) any
  Person that is treated as a partnership under the Code or (C) any “United
  States person” (as defined in Section 7701(a)(30) of the Code) or (B) to the
  extent excluded from Section 7.1.8 of the Credit Agreements (it begin agreed
  that the term “Collateral” shall include such Investment Property from and
  after the date such exclusion no longer applies to such Investment Property).
  

          SECTION
2.2. Security for Obligations. This Pledge Agreement and the Collateral
in which the Administrative Agent for the benefit of the Secured Parties is
granted a security interest hereunder by the Pledgors secure the payment and
performance of all of the Obligations. 

          SECTION
2.3. Pledgors Remain Liable. Anything herein to the contrary
notwithstanding: 

	
 

	
 

	
 

	
          (a) the Pledgors will remain liable under the contracts and agreements included
  in the Collateral to the extent set forth therein, and will perform all of
  their 

	
 

	
 

	
 

	
duties and
  obligations under such contracts and agreements to the same extent as if this
  Pledge Agreement had not been executed;

	
 

	
 

	
 

	
          (b)
  the exercise by the Administrative Agent of any of its rights hereunder will
  not release any Pledgor from any of its duties or obligations under any such
  contracts or agreements included in the Collateral; and 

	
 

	
 

	
 

	
          (c)
  no Secured Party will have any obligation or liability under any contracts or
  agreements included in the Collateral by reason of this Pledge Agreement, nor
  will any Secured Party be obligated to perform any of the obligations or
  duties of any Pledgor thereunder or to take any action to collect or enforce
  any claim for payment assigned hereunder. 

          SECTION
2.4. Distributions. Upon the occurrence and continuance of a Specified
Default, no Distribution may be paid directly to any Pledgor. 

ARTICLE III

REPRESENTATIONS AND WARRANTIES 

          In
order to induce the Secured Parties to enter into the Credit Agreement and make
Credit Extensions thereunder and to induce the Secured Parties to enter into
Lender Hedging Agreements and other Loan Documents, the Pledgors represent and
warrant to each Secured Party as set forth below. 

          SECTION
3.1. As to Capital Securities of the Subsidiaries. 

	
 

	
 

	
 

	
 

	
          (a)
  With respect to any direct Material Subsidiary of any Pledgor that is 

	
 

	
 

	
 

	
 

	
 

	
          (i)
  a corporation, business trust, joint stock company or similar Person, all
  Capital Securities issued by such Subsidiary is duly authorized and validly
  issued, fully paid and non assessable, and represented by a certificate; and 

	
 

	
 

	
 

	
 

	
 

	
          (ii)
  a partnership or limited liability company, no Capital Securities issued by
  such Subsidiary (A) is dealt in or traded on securities exchanges or in
  securities markets, (B) expressly provides that such Capital Securities is a
  security governed by Article 8 of the UCC or (C) is held in a Securities
  Account, except, with respect to this clause (a)(ii), Capital
  Securities (x) for which the Administrative Agent is the registered owner or
  (y) with respect to which the issuer has agreed in an authenticated record
  with such Pledgor and the Administrative Agent to comply with any
  instructions of the Administrative Agent without consent of such Pledgor. 

	
 

	
 

	
 

	
 

	
          (b)
  Each Pledgor has delivered all Certificated Securities constituting
  Collateral held by such Pledgor on the Effective Date to the Administrative
  Agent, together with duly executed undated blank stock powers, or other
  equivalent instruments of transfer acceptable to the Administrative Agent.

	
 

	
 

	
 

	
 

	
          (c)
  With respect to Uncertificated Securities constituting Collateral (other than
  Uncertificated Securities credited to a Securities Account) owned by any
  Pledgor, such Pledgor has caused the issuer thereof either to (i) register
  the Administrative Agent as the registered owner of such security or (ii)
  agree in an authenticated record with such Pledgor and the Administrative
  Agent that such issuer will comply with instructions with respect to such
  security originated by the Administrative Agent without further consent of
  such Pledgor.

	
 

	
 

	
 

	
 

	
          (d)
  The percentage of the issued and outstanding Capital Securities pledged by
  each Pledgor hereunder is as set forth on Schedule I.

          SECTION
3.2. Pledgor Name, Location, etc. 

	
 

	
 

	
 

	
          (a)
  The jurisdiction in which each Pledgor is located for purposes of Sections
  9-301 and 9-307 of the UCC is set forth in Item A of Schedule II.
  

	
 

	
 

	
 

	
          (b)
  Each location a secured party would have filed a UCC financing statement in
  the five years prior to the date hereof to perfect a security interest in any
  assets owned by such Pledgor is set forth in Item B of Schedule II.
  

	
 

	
 

	
 

	
          (c)
  The Pledgors do not have any trade names other than those set forth in Item
  C of Schedule II hereto. 

	
 

	
 

	
 

	
          (d)
  During the four months preceding the date hereof, no Pledgor has been known
  by any legal name different from the one set forth on the signature page
  hereto, nor has any Pledgor been the subject of any merger or other corporate
  reorganization, except as set forth in Item D of Schedule II
  hereto. 

	
 

	
 

	
 

	
          (e)
  Each Pledgor’s federal taxpayer identification number is (and, during the
  four months preceding the date hereof, such Pledgor has not had a federal
  taxpayer identification number different from that) set forth in Item E
  of Schedule II hereto. 

	
 

	
 

	
 

	
          (f)
  The name set forth on the signature page attached hereto is the true and
  correct legal name (as defined in the UCC) of each Pledgor. 

          SECTION
3.3. Ownership, No Liens, etc. Each Pledgor has rights in or the power
to transfer the Collateral, and owns its Collateral free and clear of any Lien,
except for Permitted Liens (as defined in the Credit Agreement). No effective
UCC financing statement or other filing similar in effect covering all or any
part of the Collateral is on file in any recording office, except those filed
in favor of the Administrative Agent relating to this Pledge Agreement. 

          SECTION
3.4. Validity, etc. 

	
 

	
 

	
 

	
          (a)
  This Pledge Agreement creates a valid security interest in the Collateral
  securing the payment of the Obligations. 

	
 

	
 

	
 

	
          (b)
  Each Pledgor has filed or caused to be filed all UCC-1 financing statements
  in the filing offices set forth in Item A of Schedule II
  (collectively, the “Filing

	
 

	
 

	
 

	
Statements”)
  (or has authenticated and delivered to the Administrative Agent the Filing
  Statements suitable for filing in such offices) and has taken all other
  actions necessary for the Administrative Agent to obtain control of the
  Investment Property pledged hereunder as provided in Section 9-106 of the
  UCC.

	
 

	
 

	
 

	
          (c)
  Upon the filing of the Filing Statements with the appropriate agencies
  therefor the security interests created under this Pledge Agreement shall
  constitute a perfected security interest in the Collateral in favor of the
  Administrative Agent on behalf of the Secured Parties, prior to all other
  Liens (except for Permitted Liens).

	
 

	
 

	
          SECTION
  3.5. Authorization, Approval, etc. Except as have been obtained or
  made and are in full force and effect, no authorization, approval or other
  action by, and no notice to or filing with, any Governmental Authority or any
  other third party is required:

	
 

	
 

	
          (a)
  for the grant by the Pledgors of the security interest granted hereby or for
  the execution, delivery and performance of this Pledge Agreement by the
  Pledgors;

	
 

	
 

	
 

	
          (b)
  for (i) the perfection or maintenance of the security interests hereunder
  including the first priority nature of such security interests (except with
  respect to the filing of the Filing Statements in accordance with Section
  3.4(b) and continuation statements with respect to the Filing Statements
  under Section 9-515(d) of the relevant UCC); or

	
 

	
 

	
 

	
          (c)
  for the exercise by the Administrative Agent of the rights and remedies
  provided for in this Pledge Agreement, except with respect to any securities
  issued by the Subsidiary Guarantor, actions that may be required in
  connection with a disposition of such securities by laws affecting the
  offering and sale of securities generally.

	
 

	
 

          SECTION
3.6. Best Interests. It is in the best interests of each Pledgor (other
than the Borrower) to execute this Pledge Agreement inasmuch as such Pledgor
will, as a result of being a Subsidiary of the Borrower, derive substantial
direct and indirect benefits from the Credit Extensions made from time to time
to the Borrower by the Lenders pursuant to the Credit Agreement and the
execution and delivery of Lender Hedging Agreements and other Loan Documents
between the Borrower and certain Secured Parties, and each Pledgor agrees that
the Secured Parties are relying on this representation in agreeing to make such
Loans pursuant to the Credit Agreement to the Borrower. 

ARTICLE IV

COVENANTS

          Each
Pledgor covenants and agrees that, until the Termination Date, such Pledgor
will perform, comply with and be bound by the obligations set forth below. 

          SECTION
4.1. As to Investment Property, etc. 

          SECTION
4.1.1 Capital Securities of the Subsidiary Guarantor. No Pledgor will
allow any of its Material Subsidiaries: 

	
 

	
 

	
 

	
          (a)
  that is a corporation, business trust, joint stock company or similar Person,
  to issue Uncertificated Securities; 

	
 

	
 

	
 

	
          (b)
that is a partnership or limited liability company, to (i) issue Capital
Securities that are to be dealt in or traded on securities exchanges or in
securities markets, (ii) expressly provide in its Organic Documents that its
Capital Securities are securities governed by Article 8 of the UCC, or (iii)
place such Subsidiary’s Capital Securities in a Securities Account, except,
with respect to this clause (b), Capital Securities (x) for which the
Administrative Agent is the registered owner or (y) with respect to which the
issuer has agreed in an authenticated record with such Pledgor and the
Administrative Agent to comply with any instructions of the Administrative
Agent without consent of such Pledgor; and  

	
 

	
 

	
 

	
          (c)
  to issue Capital Securities in addition to or in substitution for the Capital
  Securities pledged hereunder, except to such Pledgor (and such Capital
  Securities are immediately pledged and delivered to the Administrative Agent
  pursuant to the terms of this Pledge Agreement). 

	
 

	
 

	
          SECTION
  4.1.2. Certificated and Uncertificated Securities. 

	
 

	
 

	
          (a)
  Such Pledgor will deliver all Certificated Securities that constitute
  Collateral owned or held by such Pledgor to the Administrative Agent,
  together with duly executed undated blank stock powers, or other equivalent
  instruments of transfer reasonably acceptable to the Administrative Agent. 

	
 

	
 

	
 

	
          (b)
  Such Pledgor will cause the issuer of any and all Uncertificated Securities
  (other than Uncertificated Securities credited to a Securities Account)
  constituting Collateral owned or held by such Pledgor, to either (i) register
  the Administrative Agent as the registered owner thereof on the books and
  records of the issuer or (ii) execute a control agreement relating to such
  Investment Property pursuant to which the issuer agrees to comply with the
  Administrative Agent’s instructions with respect to such Uncertificated
  Securities without further consent by such Pledgor. 

	
 

	
 

	
          SECTION
4.1.2. Continuous Pledge. Each Pledgor will (subject to the terms of
Section 2.4 hereof) deliver to the Administrative Agent and at all times keep
pledged to the Administrative Agent pursuant hereto, on a first-priority,
perfected basis, all Collateral consisting of Investment Property, all
Distributions with respect thereto, all Payment Intangibles to the extent
they are evidenced by a Document, Instrument, Promissory Note or Chattel
Paper, all interest and principal with respect to such Payment Intangibles,
and all Proceeds and rights from time to time received by or distributable to
such Pledgor in respect of any of the foregoing Collateral. Each Pledgor
agrees that it will, promptly following receipt thereof, deliver to the
Administrative Agent possession of all originals of Collateral consisting of
negotiable Documents, Instruments, Promissory Notes and Chattel Paper that it
acquires following the Effective Date.  

	
 

	
 

	
          SECTION
  4.2. Collateral; Distributions; Voting Rights, etc. 

	
 

	
 

	
          (a)
  Each Pledgor agrees promptly upon receipt of notice of the occurrence and
  continuance of a Specified Default from the Administrative Agent and without
  any request therefor by the Administrative Agent, so long as such Specified
  Default shall continue, to deliver (properly endorsed where required hereby
  or requested by the Administrative Agent) to the Administrative Agent all
  Collateral (including Proceeds to be distributed to (or payable to) such
  Pledgor) and all Distributions, in each case thereafter received by such
  Pledgor, all of which shall be held by the Administrative Agent as additional
  Collateral. All such Collateral and Distributions that may at any time and
  from time to time be held by such Pledgor, but which such Pledgor is then
  obligated to deliver to the Administrative Agent, shall, until delivery to
  the Administrative Agent, be held by such Pledgor separate and apart from,
  and not commingled with, its other property in trust for the Administrative
  Agent. The Administrative Agent shall deposit Proceeds of Collateral in a
  Deposit Account of each Pledgor maintained with the Administrative Agent (the
  “Collateral Account”); provided that the Administrative Agent
  shall have the right to apply any amount in the Collateral Account to the
  payment of any Obligations which are due and payable. With respect to any
  Collateral Account, it is hereby confirmed and agreed that (i) deposits in
  such Collateral Account are subject to a security interest as contemplated
  hereby, (ii) such Collateral Account shall be under the control of the
  Administrative Agent and (iii) the Administrative Agent shall have the sole
  right of withdrawal over such Collateral Account. 

	
 

	
 

	
 

	
          (b)
The Administrative Agent agrees that unless a Specified Default shall have
occurred and be continuing and the Administrative Agent shall have given the
notice referred to in clause (a) of this Section, each Pledgor will have the
exclusive voting power with respect to Capital Securities constituting
Collateral and the Administrative Agent will, upon the written request of
such Pledgor, promptly deliver such proxies and other documents, if any, as
shall be reasonably requested by such Pledgor which are necessary to allow
such Pledgor to exercise that voting power; provided that no vote
shall be cast, or consent, waiver, or ratification given, or action taken by
any Pledgor that would impair any such Collateral or be inconsistent with or
violate any provision of any Loan Document.  

	
 

	
 

	
          SECTION
  4.3. Change of Name, etc. No Pledgor will change its name or place of
  incorporation or organization or federal taxpayer identification number
  except upon 30 days’ prior written notice to the Administrative Agent. 

	
 

	
          SECTION 4.4.
  As to Collateral Generally. 

	
 

	
 

	
          (a)
  Subject to clause (b) below, each Pledgor will, at its own expense,
  endeavor to collect, as and when due, all amounts due with respect to any of
  the Collateral, including the taking of such action with respect to such
  collection as the Administrative Agent may request following the occurrence
  of a Specified Default or, in the absence of such request, as such Pledgor
  may deem advisable. 

	
 

	
 

	
 

	
          (b)
  At any time following the occurrence and during the continuance of a
  Specified Default, whether before or after the maturity of any of the
  Obligations, the Administrative Agent may (i) revoke any or all of the rights
  of each Pledgor set forth in clause (a), (ii) notify any parties
  obligated on any of the Collateral to make payment to the Administrative
  Agent of any amounts due or to become due thereunder and (iii) enforce
  collection of any of the Collateral by suit or otherwise and surrender,
  release, or exchange all or any part thereof, or compromise or extend or
  renew for any period (whether or not longer than the original period) any
  indebtedness thereunder or evidenced thereby. 

	
 

	
 

	
 

	
          (c)
  Upon request of the Administrative Agent following the occurrence and during
  the continuance of a Specified Default, each Pledgor will, at its own
  expense, notify any parties obligated on any of the Collateral to make
  payment to the Administrative Agent of any amounts due or to become due
  thereunder. 

	
 

	
 

	
 

	
          (d)
  At any time following the occurrence and during the continuation of a
  Specified Default, the Administrative Agent may endorse, in the name of such
  Pledgor, any item, howsoever received by the Administrative Agent,
  representing any payment on or other Proceeds of any of the Collateral. 

	
 

	
 

	
 

	
          (e)
  The Borrower shall not be party to any Hedging Agreement unless such Hedging
  Agreement expressly permits that such Hedging Agreement and the rights
  thereunder can be assigned to the Secured Parties. 

	
 

	
 

	
          SECTION
  4.5. Transfers. No Pledgor shall sell, assign (by operation of law or
  otherwise) or otherwise dispose of any of the Collateral, except as provided
  in the Credit Agreement. 

	
 

	
          SECTION
  4.6. Further Assurances, etc. Each Pledgor agrees that from time to
  time at its own expense, it will promptly execute and deliver all further
  instruments and documents, and take all further action, that may be necessary
  or that the Administrative Agent may reasonably request, in order to perfect,
  preserve and protect any security interest granted or purported to be granted
  hereby or to enable the Administrative Agent to exercise and enforce its
  rights and remedies hereunder with respect to any Collateral. Without
  limiting the generality of the foregoing, such Pledgor will 

	
 

	
 

	
          (a)
  from time to time upon the request of the Administrative Agent, promptly
  deliver to the Administrative Agent such stock powers, instruments and
  similar documents, satisfactory in form and substance to the Administrative
  Agent, with respect to such Collateral as the Administrative Agent may
  request and will, from time to time upon the request of the Administrative
  Agent, after the occurrence and during the continuance of any Specified
  Default, promptly transfer any securities constituting Collateral into the
  name of any nominee designated by the Administrative Agent; if any Collateral
  shall be evidenced by an Instrument, negotiable Document, Promissory Note or
  tangible Chattel Paper, deliver and pledge to the Administrative Agent
  hereunder such Instrument, negotiable Document, Promissory Note or tangible
  Chattel Paper duly 

	
 

	
 

	
 

	
endorsed and
  accompanied by duly executed instruments of transfer or assignment, all in
  form and substance satisfactory to the Administrative Agent;

	
 

	
 

	
 

	
          (b)
  file (and hereby authorize the Administrative Agent to file) such Filing
  Statements or continuation statements, or amendments thereto, and such other
  instruments or notices (including any assignment of claim form under or
  pursuant to the federal assignment of claims statute, 31 U.S.C. § 3726, any
  successor or amended version thereof or any regulation promulgated under or
  pursuant to any version thereof), as may be necessary or that the Administrative
  Agent may request in order to perfect and preserve the security interests and
  other rights granted or purported to be granted to the Administrative Agent
  hereby; 

	
 

	
 

	
 

	
          (c)
  deliver to the Administrative Agent and at all times keep pledged to the
  Administrative Agent pursuant hereto, on a first-priority, perfected basis,
  at the request of the Administrative Agent, all Investment Property
  constituting Collateral, all Distributions with respect thereto, all interest
  and principal with respect to Collateral evidenced by a Promissory Note, and
  all Proceeds and rights from time to time received by or distributable to the
  applicable Pledgor in respect of any of the foregoing Collateral, and all
  Proceeds and rights from time to time received by or distributable to such
  Pledgor in respect of any of the foregoing Collateral; 

	
 

	
 

	
 

	
          (d)
  do all things requested by the Administrative Agent in accordance with this
  Pledge Agreement in order to enable the Administrative Agent to have and
  maintain control over the Collateral consisting of Investment Property; 

	
 

	
 

	
 

	
          (e)
  not take or omit to take any action the taking or the omission of which would
  result in any material impairment or alteration of any obligation of the
  maker of any Payment Intangible or other Instrument constituting Collateral,
  except as provided in Section 4.4; and 

	
 

	
 

	
 

	
          (f)
  not create any tangible Chattel Paper with respect to the Collateral without
  placing a legend on such tangible Chattel Paper acceptable to the
  Administrative Agent indicating that the Administrative Agent has a security
  interest in such Chattel Paper. 

	
 

	
 

	
With
  respect to the foregoing and the grant of the security interest hereunder,
  each Pledgor hereby authorizes the Administrative Agent to file one or more
  financing or continuation statements, and amendments thereto, relative to all
  or any part of the Collateral. Each Pledgor agrees that a carbon,
  photographic or other reproduction of this Pledge Agreement or any UCC
  financing statement covering the Collateral or any part thereof shall be
  sufficient as a UCC financing statement where permitted by law. 

ARTICLE V 

THE ADMINISTRATIVE AGENT

          SECTION
5.1. Administrative Agent Appointed Attorney-in-Fact. Each Pledgor
hereby irrevocably appoints the Administrative Agent its attorney-in-fact, with
full authority in the place and stead of such Pledgor and in the name of such
Pledgor or otherwise, from time to 

time in the
Administrative Agent’s discretion, following the occurrence and during the
continuance of a Specified Default, to take any action and to execute any
instrument which the Administrative Agent may deem necessary or advisable to
accomplish the purposes of this Pledge Agreement, including: 

	
 

	
 

	
 

	
          (a)
  to ask, demand, collect, sue for, recover, compromise, receive and give
  acquittance and receipts for moneys due and to become due under or in respect
  of any of the Collateral; 

	
 

	
 

	
 

	
          (b)
  to receive, endorse and collect any drafts or other writings in connection
  with clause (a) above; 

	
 

	
 

	
 

	
          (c)
  to file any claims or take any action or institute any proceedings which the
  Administrative Agent may deem necessary or desirable for the collection of
  any of the Collateral or otherwise to enforce the rights of the
  Administrative Agent with respect to any of the Collateral; and 

	
 

	
 

	
 

	
          (d)
  to perform the affirmative obligations of such Pledgor hereunder. 

	
 

	
 

	
Each Pledgor
  hereby acknowledges, consents and agrees that the power of attorney granted pursuant
  to this Section is irrevocable and coupled with an interest. 

	
 

	
          SECTION
  5.2. Administrative Agent May Perform. If any Pledgor fails to perform
  any agreement contained herein, the Administrative Agent may itself perform,
  or cause performance of, such agreement, and the reasonable expenses of the
  Administrative Agent incurred in connection therewith shall be payable by
  such Pledgor pursuant to Section 10.3 of the Credit Agreement. 

	
 

	
          SECTION
  5.3. Administrative Agent Has No Duty. The powers conferred on the
  Administrative Agent hereunder are solely to protect its interest (on behalf
  of the Secured Parties) in the Collateral and shall not impose any duty on it
  to exercise any such powers. Except for reasonable care of any Collateral in
  its possession and the accounting for moneys actually received by it
  hereunder, the Administrative Agent shall have no duty as to any Collateral
  or responsibility for: 

	
 

	
 

	
          (a)
  ascertaining or taking action with respect to calls, conversions, exchanges,
  maturities, tenders or other matters relative to any Collateral, whether or
  not the Administrative Agent has or is deemed to have knowledge of such
  matters; or

	
 

	
 

	
 

	
          (b)
  taking any necessary steps to preserve rights against prior parties or any
  other rights pertaining to any Collateral. 

	
 

	
 

	
SECTION 5.4.
Reasonable Care. The Administrative Agent is required to exercise
reasonable care in the custody and preservation of any of the Collateral in
its possession; provided that the Administrative Agent shall be deemed to
have exercised reasonable care in the custody and preservation of any of the
Collateral, if it takes such action for that purpose as each Pledgor
reasonably requests in writing at times other than upon the occurrence and during
the  

continuance of any Specified
Default, but failure of the Administrative Agent to comply with any such
request at any time shall not in itself be deemed a failure to exercise
reasonable care.

ARTICLE VI

REMEDIES 

          SECTION
6.1. Certain Remedies. If any Specified Default shall have occurred and be
continuing: 

	
 

	
 

	
 

	
 

	
          (a)
  The Administrative Agent may exercise in respect of the Collateral, in
  addition to other rights and remedies provided for herein or otherwise
  available to it, all the rights and remedies of a Secured Party on default
  under the UCC (whether or not the UCC applies to the affected Collateral) and
  also may: 

	
 

	
 

	
 

	
 

	
 

	
          (i)
  take possession of any Collateral not already in its possession without
  demand and without legal process; 

	
 

	
 

	
 

	
 

	
 

	
          (ii)
  require each Pledgor to, and each Pledgor hereby agrees that it will, at its
  expense and upon written 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 to be
  designated by the Administrative Agent that is reasonably convenient to both
  parties; 

	
 

	
 

	
 

	
 

	
 

	
          (iii)
  enter onto the property where any Collateral is located and take possession
  thereof without demand and without legal process; and 

	
 

	
 

	
 

	
 

	
 

	
          (iv)
  without notice except as specified below, lease, license, sell or otherwise
  dispose of the Collateral or any part thereof in one or more parcels at
  public or private sale, at any of the Administrative Agent’s offices or
  elsewhere, for cash, on credit or for future delivery, and upon such other
  terms as the Administrative Agent may deem commercially reasonable. Each
  Pledgor agrees that, to the extent notice of sale shall be required by law,
  at least ten days’ prior written notice to such Pledgor of the time and place
  of any public sale or the time after which any private sale is to be made
  shall constitute reasonable notification. The Administrative Agent shall not
  be obligated to make any sale of Collateral regardless of notice of sale
  having been given. The Administrative Agent may adjourn any public or private
  sale from time to time by announcement at the time and place fixed therefor,
  and such sale may, without further notice, be made at the time and place to
  which it was so adjourned. 

	
 

	
 

	
 

	
 

	
          (b)
  All cash Proceeds received by the Administrative Agent in respect of any sale
  of, collection from, or other realization upon, all or any part of the
  Collateral shall be applied by the Administrative Agent against all or any
  part of the Obligations as set forth in Section 4.7 of the Credit Agreement. 

	
 

	
 

	
 

	
(c)      The
  Administrative Agent may: 

	
 

	
 

	
 

	
          (i)
  transfer all or any part of the Collateral into the name of the
  Administrative Agent or its nominee, with or without disclosing that such
  Collateral is subject to the Lien hereunder; 

	
 

	
 

	
 

	
          (ii)
  notify the parties obligated on any of the Collateral to make payment to the
  Administrative Agent of any amount due or to become due thereunder; 

	
 

	
 

	
 

	
          (iii)
  withdraw, or cause or direct the withdrawal, of all funds with respect to the
  Collateral Account; 

	
 

	
 

	
 

	
          (iv)
  enforce collection of any of the Collateral by suit or otherwise, and
  surrender, release or exchange all or any part thereof, or compromise or
  extend or renew for any period (whether or not longer than the original
  period) any obligations of any nature of any party with respect thereto; 

	
 

	
 

	
 

	
          (v)
  endorse any checks, drafts, or other writings in any Pledgor’s name to allow
  collection of the Collateral; 

	
 

	
 

	
 

	
          (vi)
  take control of any Proceeds of the Collateral; and 

	
 

	
 

	
 

	
          (vii)
  execute (in the name, place and stead of any Pledgor) endorsements,
  assignments, stock powers and other instruments of conveyance or transfer
  with respect to all or any of the Collateral. 

          SECTION
6.2. Compliance with Restrictions. Each Pledgor agrees that, in any sale
of any of the Collateral whenever a Specified Default shall have occurred and
be continuing, the Administrative Agent is hereby authorized to comply with any
limitation or restriction in connection with such sale as it may be advised by
counsel is necessary in order to avoid any violation of applicable law
(including compliance with such procedures as may restrict the number of
prospective bidders and purchasers, require that such prospective bidders and
purchasers have certain qualifications, and restrict such prospective bidders
and purchasers to Persons who will represent and agree that they are purchasing
for their own account for investment and not with a view to the distribution or
resale of such Collateral), or in order to obtain any required approval of the
sale or of the purchaser by any Governmental Authority or official, and such
Pledgor further agrees that such compliance shall not result in such sale being
considered or deemed not to have been made in a commercially reasonable manner,
nor shall the Administrative Agent be liable nor accountable to such Pledgor
for any discount allowed by the reason of the fact that such Collateral is sold
in compliance with any such limitation or restriction. 

          SECTION
6.3. Protection of Collateral. The Administrative Agent may from time to
time, at its option, perform any act which any Pledgor fails to perform after
being requested in writing so to perform (it being understood that no such
request need be given after the occurrence and during the continuance of a
Specified Default) and the Administrative Agent may 

from time to
time take any other action which the Administrative Agent deems necessary for
the maintenance, preservation or protection of any of the Collateral or of its
security interest therein. 

ARTICLE VII

MISCELLANEOUS PROVISIONS 

          SECTION
7.1. Loan Document. This Pledge Agreement is a Loan Document executed
pursuant to the Credit Agreement and shall (unless otherwise expressly
indicated herein) be construed, administered and applied in accordance with the
terms and provisions thereof, including Article X thereof. 

          SECTION
7.2. Binding on Successors, Transferees and Assigns; Assignment. This
Pledge Agreement shall remain in full force and effect until the Termination
Date has occurred, shall be binding upon the Pledgors and their successors,
transferees and assigns and shall inure to the benefit of and be enforceable by
each Secured Party and its successors, transferees and assigns; provided that no Pledgor may (unless otherwise permitted under the terms of the Credit
Agreement or this Pledge Agreement) assign any of its obligations hereunder
without the prior written consent of all Lenders. 

          SECTION
7.3. Amendments, etc. No amendment to or waiver of any provision of this
Pledge Agreement, nor consent to any departure by any Pledgor from its
obligations under this Pledge Agreement, shall in any event be effective unless
the same shall be in writing and signed by the Administrative Agent (on behalf
of the Lenders or the Required Lenders, as the case may be, pursuant to Section
10.1 of the Credit Agreement) and the Pledgors and then such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given. 

          SECTION
7.4. Notices. All notices and other communications provided for
hereunder shall be in writing or by facsimile and addressed, delivered or
transmitted to the appropriate party at the address or facsimile number of such
party specified in the Credit Agreement or at such other address or facsimile
number as may be designated by such party in a notice to the other party. Any
notice or other communication, if mailed and properly addressed with postage
prepaid or if properly addressed and sent by pre-paid courier service, shall be
deemed given when received; any notice or other communication, if transmitted
by facsimile, shall be deemed given when the confirmation of transmission
thereof is received by the transmitter. 

          SECTION
7.5. Release of Liens. Upon (a) the Disposition of Collateral in
accordance with the Credit Agreement or (b) the occurrence of the Termination
Date, the security interests granted herein shall automatically terminate with
respect to (i) such Collateral (in the case of clause (a)) or (ii) all
Collateral (in the case of clause (b)), without delivery of any
instrument or performance of any act by any party. Upon the occurrence of the
Termination Date, this Pledge Agreement and all obligations of each Pledgor
hereunder shall automatically terminate without delivery of any instrument or
performance of any act by any party. A Pledgor shall automatically be released
from its obligations hereunder upon the consummation of any transaction
permitted by the Credit Agreement as a result of which such Pledgor ceases to
be a Subsidiary of the Borrower and any of its Subsidiaries. Upon any such
Disposition, other permitted transaction or termination, the Administrative
Agent will, at each Pledgor’s sole

expense,
deliver to each Pledgor, without any representations, warranties or recourse of
any kind whatsoever, all Collateral held by the Administrative Agent hereunder,
and execute and deliver to each Pledgor such documents as such Pledgor shall
reasonably request to evidence such termination. 

          SECTION
7.6. Additional Pledgors. Upon the execution and delivery by any other
Person of a supplement in the form of Annex I hereto, such Person shall
become a “Pledgor” hereunder with the same force and effect as if it were
originally a party to this Pledge Agreement and named as a “Pledgor” hereunder.
The execution and delivery of such supplement shall not require the consent of
any other Pledgor hereunder, and the rights and obligations of each Pledgor
hereunder shall remain in full force and effect notwithstanding the addition of
any new Pledgor as a party to this Pledge Agreement. 

          SECTION
7.7. No Waiver; Remedies. In addition to, and not in limitation of
Section 2.4, no failure on the part of any Secured Party to exercise, and no
delay in exercising, any right hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any right hereunder preclude any other
or further exercise thereof or the exercise of any other right. The remedies
herein provided are cumulative and not exclusive of any remedies provided by
law.  

          SECTION
7.8. Headings. The various headings of this Pledge Agreement are
inserted for convenience only and shall not affect the meaning or
interpretation of this Pledge Agreement or any provisions thereof. 

          SECTION
7.9. Severability. Any provision of this Pledge Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such provision and
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions of this Pledge
Agreement or affecting the validity or enforceability of such provision in any
other jurisdiction. 

          SECTION
7.10. Governing Law. THIS PLEDGE AGREEMENT SHALL BE DEEMED TO BE A
CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK
(INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE GENERAL
OBLIGATIONS LAW OF THE STATE OF NEW YORK), EXCEPT TO THE EXTENT THAT THE
PERFECTION, EFFECT OF PERFECTION OR NONPERFECTION, AND PRIORITY OF THE SECURITY
INTEREST HEREUNDER, OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR
COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF
NEW YORK. 

          SECTION
7.11. Forum Selection and Consent to Jurisdiction. ANY LITIGATION BASED
HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, ANY LOAN DOCUMENT, OR
ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN)
OR ACTIONS OF THE ADMINISTRATIVE AGENT, THE SECURED PARTIES OR ANY PLEDGOR IN
CONNECTION HEREWITH OR THEREWITH MAY BE BROUGHT AND MAINTAINED IN THE COURTS OF
THE STATE OF NEW YORK OR IN THE UNITED STATES 

DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF NEW YORK; PROVIDED THAT ANY SUIT SEEKING
ENFORCEMENT AGAINST ANY PROPERTY MAY BE BROUGHT, AT THE ADMINISTRATIVE AGENT’S
OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH PROPERTY MAY BE FOUND.
EACH PLEDGOR HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO THE JURISDICTION OF
THE COURTS OF THE STATE OF NEW YORK, NEW YORK COUNTY AND OF THE UNITED STATES
DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY
SUCH LITIGATION AS SET FORTH ABOVE AND IRREVOCABLY AGREES TO BE BOUND BY ANY
JUDGMENT RENDERED THEREBY IN CONNECTION WITH SUCH LITIGATION. EACH PLEDGOR
IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY REGISTERED MAIL, POSTAGE
PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF NEW YORK AT THE
ADDRESS FOR NOTICES SPECIFIED FOR THE BORROWER IN SECTION 10.2 OF THE CREDIT
AGREEMENT. EACH PLEDGOR HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE OR HEREAFTER MAY HAVE
TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT
REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM. TO THE EXTENT THAT ANY PLEDGOR HAS OR HEREAFTER MAY ACQUIRE
ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER
THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF
EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, SUCH PLEDGOR
HEREBY IRREVOCABLY WAIVES TO THE FULLEST EXTENT PERMITTED BY LAW SUCH IMMUNITY
IN RESPECT OF ITS OBLIGATIONS UNDER THE LOAN DOCUMENTS. 

          SECTION
7.12. Waiver of Jury Trial. THE ADMINISTRATIVE AGENT (ON BEHALF OF
ITSELF AND EACH OTHER SECURED PARTY) AND EACH PLEDGOR HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE TO THE FULLEST EXTENT PERMITTED BY LAW ANY
RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED
HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, EACH LOAN DOCUMENT, OR
ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN)
OR ACTIONS OF THE ADMINISTRATIVE AGENT, SUCH SECURED PARTY OR EACH PLEDGOR IN
CONNECTION THEREWITH. EACH PLEDGOR ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED
FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION (AND EACH OTHER PROVISION
OF EACH OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY) AND THAT THIS PROVISION IS
A MATERIAL INDUCEMENT FOR THE ADMINISTRATIVE AGENT, AND EACH SECURED PARTY
ENTERING INTO THE LOAN DOCUMENTS. 

          SECTION
7.13. Counterparts. This Pledge Agreement may be executed by the parties
hereto in several counterparts, each of which shall be deemed to be an original
and all of which shall constitute together but one and the same agreement.
Delivery of an executed counterpart of a signature page to this Pledge
Agreement by facsimile shall be effective as delivery of an original executed
counterpart of this Pledge Agreement. 

          SECTION
7.14. Foreign Pledge Agreements. Without limiting any of the rights,
remedies, privileges or benefits provided hereunder to the Administrative Agent
for its benefit and the ratable benefit of the other Secured Parties, each
Pledgor and the Administrative Agent hereby agree that the terms and provisions
of this Pledge Agreement in respect of any Collateral subject to the pledge or
other Lien of a Foreign Pledge Agreement are, and shall be deemed to be,
supplemental and in addition to the rights, remedies, privileges and benefits
provided to the Administrative Agent and the other Secured Parties under such
Foreign Pledge Agreement and under applicable law to the extent consistent with
applicable law; provided that, in the event that the terms of this
Pledge Agreement conflict or are inconsistent with the applicable Foreign
Pledge Agreement or applicable law governing such Foreign Pledge Agreement, (i)
to the extent that the provisions of such Foreign Pledge Agreement or
applicable foreign law are, under applicable foreign law, necessary for the
creation, perfection or priority of the security interests in the Collateral
subject to such Foreign Pledge Agreement, the terms of such Foreign Pledge
Agreement or such applicable law shall be controlling and (ii) otherwise, the
terms hereof shall be controlling.

          IN
WITNESS WHEREOF, each of the parties hereto has caused this Pledge Agreement to
be duly executed and delivered by its Authorized Officer as of the date first
above written. 

	
 

	
 

	
 

	
 

	
HECLA MINING
 COMPANY

	
 

	
 

	
 

	
 

	
By:

	
 

	
 

	
 

	 

	
 

	
 

	
Name:

	
 

	
 

	
Title:

	
 

	
 

	
 

	
 

	
HECLA ALASKA
 LLC

	
 

	
 

	
 

	
By:

	
Hecla
 Limited,

	
 

	
 

	
its Managing
 Member

	
 

	
 

	
 

	
 

	
By:

	
 

	
 

	
 

	 

	
 

	
 

	
 

	
 

	
 

	
Name:

	
 

	
 

	
Title:

	
 

	
 

	
 

	
 

	
HECLA
 LIMITED

	
 

	
 

	
 

	
 

	
By:

	
 

	
 

	
 

	 

	
 

	
 

	
Name:

	
 

	
 

	
Title:

	
 

	
 

	
 

	
 

	
HECLA
 ADMIRALTY COMPANY

	
 

	
 

	
 

	
 

	
By:

	
 

	
 

	
 

	 

	
 

	
 

	
Name:

	
 

	
 

	
Title:

Amended and Restated Pledge Agreement

          IN
WITNESS WHEREOF, each of the parties hereto has caused this Pledge Agreement to
be duly executed and delivered by its Authorized Officer as of the date first
above written. 

	
 

	
 

	
 

	
 

	
THE BANK OF
 NOVA SCOTIA,

	
 

	
as
 Administrative Agent

	
 

	
 

	
 

	
 

	
By:

	
 

	
 

	
 

	 

	
 

	
 

	
Name:

	
 

	
 

	
Title:

Amended and Restated Pledge Agreement 

SCHEDULE I

to Amended and Restated Pledge Agreement 

	
 

	
 

	
 

	
Hecla Mining Company

	
% of Interests Pledged

	
Type
  Interests Pledged

	
 

	 

	 

	
Issuer

	
 

	
 

	
 

	
 

	
 

	
[OTHER PLEDGORS]

	
% of Interests Pledged

	
Type
  Interests Pledged

	
 

	 

	 

	
Issuer

	
 

	
 

SCHEDULE II

to Amended and Restated Pledge Agreement 

	
 

	
 

	
Item A. Location of
  each Pledgor.

	
 

	
 

	
Name of
  Pledgor:

	
Location for purposes of UCC:

	
[PLEDGOR]

	
[LOCATION]

	
 

	
 

	
Item B. Filing
  locations last five years.

	
 

	
 

	
Name of
  Pledgor:

	
Filing locations last five years

	
[PLEDGOR]

	
[LOCATION]

	
 

	
 

	
Item C. Trade names.

	
 

	
 

	
Name of
  Pledgor:

	
Trade Names:

	
[PLEDGOR]

	
 

	
 

	
 

	
Item D. Merger or
  other corporate reorganization.

	
 

	
 

	
Name of
  Pledgor:

	
Merger or other corporate
reorganization:

	
[PLEDGOR]

	
 

Item E. Taxpayer ID numbers.

	
 

	
 

	
Name of
  Pledgor:

	
Taxpayer ID numbers:

	
[PLEDGOR]

	
 

ANNEX I 

to Amended and Restated Pledge Agreement

SUPPLEMENT TO 

PLEDGE AGREEMENT

          This
SUPPLEMENT, dated as of ____________ ___, _____ (this “Supplement”), is
to the Pledge Agreement, dated as of April [__], 2008 (as amended,
supplemented, amended and restated or otherwise modified from time to time, the
“Pledge Agreement”), among the Pledgors (such term, and other terms used in
this Supplement, to have the meanings set forth in Article I of the Pledge
Agreement) from time to time party thereto, in favor of THE BANK OF NOVA
SCOTIA, as the administrative agent (together with its successor(s) thereto in
such capacity, the “Administrative Agent”) for each of the Secured Parties. 

W I T N
E S S E T H :

          WHEREAS,
pursuant to a Credit Agreement, dated as of April [__], 2008 (as amended,
supplemented, amended and restated, extended or otherwise modified from time to

time, the “Credit Agreement”), among the Borrower, the various financial
institutions and other Persons from time to time party thereto, the
Administrative Agent and Scotia Capital, as the Lead Arranger, the Lenders have
extended Commitments to make Credit Extensions to the Borrower; 

          WHEREAS,
pursuant to the provisions of Section 7.6 of the Pledge Agreement, each
of the undersigned is becoming a Pledgor under the Pledge Agreement; and 

          WHEREAS,
each of the undersigned desires to become a “Pledgor” under the Pledge
Agreement in order to induce the Lenders to continue to extend Loans under the
Credit Agreement and to induce Secured Parties to enter into Lender Hedging
Agreements; 

          NOW,
THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, each of the undersigned agrees, for the benefit
of each Secured Party, as follows. 

          SECTION
1. Party to Pledge Agreement, etc. In accordance with the terms of the
Pledge Agreement, by its signature below each of the undersigned hereby
irrevocably agrees to become a Pledgor under the Pledge Agreement with the same
force and effect as if it were an original signatory thereto and each of the
undersigned hereby (a) creates and grants to the Administrative Agent, its
successors and assigns, a security interest in all of the undersigned’s right,
title and interest in and to the Collateral, (b) agrees to be bound by and
comply with all of the terms and provisions of the Pledge Agreement applicable
to it as a Pledgor and (b) represents and warrants that the representations and
warranties made by it as a Pledgor thereunder are true and correct as of the
date hereof, unless stated to relate solely to an earlier date, in which case
such representations and warranties shall be true and correct as of such
earlier date. In furtherance of the foregoing, each reference to a “Pledgor”
and/or “Pledgors” in the Pledge Agreement shall be deemed to include each of
the undersigned. 

          SECTION
2. Representations. Each of the undersigned Pledgor hereby represents
and warrants that this Supplement has been duly authorized, executed and
delivered by it and that 

this
Supplement and the Pledge Agreement constitute the legal, valid and binding
obligation of each of the undersigned, enforceable against it in accordance
with its terms. 

          SECTION
3. Full Force of Pledge Agreement. Except as expressly supplemented
hereby, the Pledge Agreement shall remain in full force and effect in
accordance with its terms. 

          SECTION
4. Severability. Wherever possible each provision of this Supplement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Supplement shall be prohibited by
or invalid under such law, such provision shall be ineffective to the extent of
such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Supplement or the Pledge
Agreement. 

          SECTION
5. Governing Law. THIS SUPPLEMENT SHALL BE DEEMED TO BE A CONTRACT MADE
UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING FOR
SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE
STATE OF NEW YORK). 

          SECTION
6. Counterparts. This Supplement may be executed by the parties hereto
in several counterparts, each of which shall be deemed to be an original and
all of which shall constitute together but one and the same agreement. Delivery
of an executed counterpart of a signature page to this Supplement by facsimile
or via other electronic means shall be effective as delivery of a manually executed
counterpart of this Agreement. 

* * * * *

          IN
WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be
duly executed and delivered by its Authorized Officer as of the date first
above written. 

	
 

	
 

	
 

	
 

	
[NAME OF
 ADDITIONAL SUBSIDIARY]

	
 

	
 

	
 

	
 

	
By:

	
 

	
 

	
 

	 

	
 

	
 

	
Name:

	
 

	
 

	
Title:

	
 

	
 

	
 

	
 

	
[NAME OF
 ADDITIONAL SUBSIDIARY]

	
 

	
 

	
 

	
 

	
By:

	
 

	
 

	
 

	 

	
 

	
 

	
Name:

	
 

	
 

	
Title:

	
 

	
 

	
 

	
ACCEPTED AND
 AGREED FOR ITSELF

	
 

	
AND ON
 BEHALF OF THE SECURED PARTIES:

	
 

	
 

	
 

	
 

	
THE BANK OF
 NOVA SCOTIA,

	
 

	
as
 Administrative Agent

	
 

	
 

	
 

	
 

	
By:

	
 

	
 

	
 

	 
	
 

	
 

	
Name:

	
 

	
 

	
Title:

	
 

EXHIBIT H 

FORM OF AMENDED AND RESTATED SECURITY
AGREEMENT

          This
AMENDED AND RESTATED SECURITY AGREEMENT, dated as of ____________, 200_ (as
amended, supplemented, amended and restated or otherwise modified from time to
time, this “Security Agreement”), is made by HECLA MINING COMPANY, a
Delaware corporation (the “Borrower”), HECLA ALASKA LLC, a Delaware
limited liability company (“Hecla Alaska”), KENNECOTT GREENS CREEK
MINING COMPANY, a Delaware corporation (“Kennecott”) and KENNECOTT
JUNEAU MINING COMPANY, a Delaware corporation (“Kennecott Juneau” and
together with the Borrower, Hecla Alaska and Kennecott, each individually a “Grantor”
and collectively, the “Grantors”), in favor of THE BANK OF NOVA SCOTIA,
as the administrative agent (together with its successor(s) thereto in such
capacity, the “Administrative Agent”) for each of the Secured Parties.
This Security Agreement amends and restates in its entirety the Borrower
Security Agreement, dated September 12, 2005, between the Borrower and the Administrative
Agent, as amended, supplemented, amended and restated or otherwise modified
from time to time prior to the date hereof, and continues the security interest
granted thereunder to the extent set forth herein. 

W I T N E S S E T H :

          WHEREAS,
pursuant to an Amended and Restated Credit Agreement, dated as of April [_],
2008 (as amended, supplemented, amended and restated, extended or otherwise
modified from time to time, the “Credit Agreement”), among the Borrower,
the various financial institutions and other Persons from time to time party
thereto, the Administrative Agent and Scotia Capital, as the Lead Arranger, the
Lenders have extended Commitments to make Credit Extensions to the Borrower;
and 

          WHEREAS,
as a condition precedent to the making of the Credit Extensions under the
Credit Agreement, each Grantor is required to execute and deliver this Security
Agreement. 

          NOW,
THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, and in order to induce the Lenders to make
Credit Extensions to the Borrower, and to induce Secured Parties to enter into
Lender Hedging Agreements and the other Loan Documents, each Grantor agrees,
for the benefit of each Secured Party, as follows: 

ARTICLE I 

DEFINITIONS

          SECTION
1.1. Certain Terms. The following terms (whether or not underscored),
when used in this Security Agreement, including its preamble and recitals,
shall have the following meanings (such definitions to be equally applicable to
the singular and plural forms thereof): 

          “Administrative
Agent” is defined in the preamble. 

          “Borrower”
is defined in the preamble. 

          “Collateral”
is defined in Section 2.1. 

          “Collateral
Account” is defined in clause (a) of Section 4.1. 

          “Credit
Agreement” is defined in the first recital. 

          “Distributions”
means all distributions or other payments, whether in cash, securities or
property, by the Greens Creek Participants to the Borrower. 

          “Equipment”
is defined in Section 2.1(a)(iii). 

          “General
Intangibles” means all “general intangibles” and all “payment intangibles”,
each as defined in the UCC, and shall include all interest rate or currency
protection or hedging arrangements (including commodity arrangements), all tax
refunds, all licenses, permits, concessions and authorizations and all
Intellectual Property Collateral (in each case, regardless of whether
characterized as general intangibles under the UCC). 

          “Grantor”
and “Grantors” are defined in the preamble. 

          “Intellectual
Property Collateral” means, collectively, the Computer Hardware and
Software Collateral, the Copyright Collateral, the Patent Collateral, the
Trademark Collateral and the Trade Secrets Collateral, as each such term is
defined in Annex I hereto. 

          “Inventory”
is defined in Section 2.1(a)(iii). 

          “Loan
Documents” means the Loan Documents, as defined in the Credit Agreement,
together with (except for purposes of Article V) the following: Lender
Hedging Agreements and each other agreement which evidences an Obligation or
under which an Obligation arises. 

          “Permitted
Liens” means all Liens permitted by clause (a), clause (h) or clause (j) of
Section 7.2.3 of the Credit Agreement. 

          “Security
Agreement” is defined in the preamble. 

          “Specified
Default” means the occurrence and continuance of (a) an Event of Default or
(b) a Default under clauses (a) through (d) of Section 8.1.9 of the Credit
Agreement. 

          SECTION
1.2. Credit Agreement Definitions. Unless otherwise defined herein or
the context otherwise requires, terms used in this Security Agreement,
including its preamble and recitals, have the meanings provided in the Credit
Agreement. 

          SECTION
1.3. UCC Definitions. When used herein the terms Account, Chattel Paper,
Deposit Account, Document, Goods, Instrument, Letter of Credit Rights, Payment
Intangibles, Proceeds, Promissory Notes, and Supporting Obligations have the
meaning provided in Article 8 or Article 9, as applicable, of the UCC. 

ARTICLE II 

SECURITY INTEREST

          SECTION
2.1. Grant of Security Interest. Each Grantor hereby grants to the
Administrative Agent, for its benefit and the ratable benefit of each other
Secured Party, a continuing security interest in all of such Grantor’s
following property, whether now or hereafter existing, owned or acquired by
such Grantor, and wherever located, (collectively, the “Collateral”): 

          (a)
all right, title and interest of each Grantor in, to and under the Greens Creek
Joint Venture and the Greens Creek Joint Venture Agreement, including 

	
 

	
 

	
 

	
          (i)
 each Grantor’s ownership interests in the Greens Creek Joint Venture; 

	
 

	
 

	
 

	
          (ii)
 each Grantor’s interests in all revenues, profits, income, distributions and
 other reimbursements and payments with respect to the Greens Creek Joint
 Venture; 

	
 

	
 

	
 

	
          (iii)
 each Grantor’s interests in all assets of the Greens Creek Joint Venture,
 including (A) all equipment in all of its forms of the Greens Creek Joint
 Venture, wherever located, including all parts thereof and all accessions,
 additions, attachments, improvements, substitutions and replacements thereto
 and therefor and all accessories related thereto (any and all of the
 foregoing being the “Equipment”); (B) all inventory in all of its
 forms of the Greens Creek Joint Venture, wherever located, including (1) raw
 materials, including ores, minerals and other mineral resources that are
 mined, extracted, stored, produced, handled, milled or otherwise processed by
 the Greens Creek Joint Venture, and other work in process therefor, finished
 goods thereof, and materials used or consumed in the manufacture or
 production thereof, (2) all goods in which the Greens Creek Joint Venture has
 an interest in mass or a joint or other interest or right of any kind
 (including goods in which the Greens Creek Joint Venture has an interest or
 right as consignee), (3) all goods which are returned to or repossessed by
 the Greens Creek Joint Venture, and (4) all accessions thereto, products
 thereof and documents therefor (any and all such inventory, materials, goods,
 accessions, products and documents being the “Inventory”); (C) all
 other Goods of the Greens Creek Joint Venture; (D) all Accounts, Chattel
 Paper, Documents, Instruments, Promissory Notes and General Intangibles
 (including and together with all tax refunds and all rights under all present
 and future authorizations, permits and licenses), Letter of Credit Rights and
 Supporting Obligations of the Greens Creek Joint Venture, whether or not
 arising out of or in connection with the sale or lease of goods, including
 minerals (before or after extraction), or the rendering of services; (E) all
 Intellectual Property Collateral of the Greens Creek Joint Venture; (F) all
 Deposit Accounts of the Greens Creek Joint Venture; (G) all commercial tort
 claims of the Greens Creek Joint Venture, (H) all other property and rights
 of every kind and description and interests therein of the Greens Creek Joint
 Venture; and (I) all books, records, writings, data bases, information and

	
 

	
 

	
 

	
other
 property relating to, evidencing, embodying, incorporating or referring to,
 any of the foregoing in this clause (a)(iii); 

          (b)
all Proceeds of the foregoing and, to the extent not otherwise included, all
payments under insurance (whether or not the Administrative Agent is the loss
payee thereof). 

          Notwithstanding
the foregoing, the term “Collateral” shall not include: 

	
 

	
 

	
 

	
          (i)
 any General Intangibles or other rights arising under any contracts,
 instruments, licenses or other documents as to which the grant of a security
 interest would (A) constitute a violation of a valid and enforceable
 restriction in favor of a third party on such grant, unless and until any
 required consents shall have been obtained, or (B) give any other party to
 such contract, instrument, license or other document a valid and enforceable
 right to terminate its obligations thereunder; or 

	
 

	
 

	
 

	
          (ii)
 any asset, the granting of a security interest in which would be void or
 illegal under any applicable governmental law, rule or regulation, or
 pursuant thereto would result in, or permit the termination of, such asset. 

          SECTION
2.2. Security for Obligations. This Security Agreement and the
Collateral in which the Administrative Agent for the benefit of the Secured
Parties is granted a security interest hereunder by the Grantors secure the
payment and performance of all of the Obligations. 

          SECTION
2.3. Grantors Remain Liable. Anything herein to the contrary
notwithstanding: 

	
 

	
 

	
 

	
          (a)
 the Grantors will remain liable under the Greens Creek Joint Venture
 Agreement and under any contracts and agreements included in the Collateral
 to the extent set forth therein, and will perform all of its duties and
 obligations under the Greens Creek Joint Venture Agreement and such contracts
 and agreements to the same extent as if this Security Agreement had not been
 executed; 

	
 

	
 

	
 

	
          (b)
 the exercise by the Administrative Agent of any of its rights hereunder will
 not release any Grantor from any of its duties or obligations under the
 Greens Creek Joint Venture Agreement and any such contracts or agreements
 included in the Collateral; and 

	
 

	
 

	
 

	
          (c)
 no Secured Party will have any obligation or liability under the Greens Creek
 Joint Venture Agreement or any contracts or agreements included in the
 Collateral by reason of this Security Agreement, nor will any Secured Party
 be obligated to perform any of the obligations or duties of any Grantor
 thereunder or to take any action to collect or enforce any claim for payment
 assigned hereunder. 

          SECTION
2.4. Distributions. Upon the occurrence and continuance of a Specified
Default, no Distribution may be paid directly to the Borrower. 

ARTICLE III 

REPRESENTATIONS AND WARRANTIES

          In
order to induce the Secured Parties to enter into the Credit Agreement and make
Credit Extensions thereunder and to induce the Secured Parties to enter into
Lender Hedging Agreements and other Loan Documents, the Grantors represent and
warrant to each Secured Party as set forth below. 

          SECTION
3.1. Participating Share; Certificate. Each Grantor’s interest in the
Greens Creek Joint Venture is set forth on Schedule I. Each Grantor’s
interest in the Green Creek Joint Venture is not represented by a certificate
of interest or similar instrument. 

          SECTION
3.2. Grantor Name, Location, etc. 

	
 

	
 

	
 

	
          (a)
 The jurisdiction in which each Grantor is located for purposes of Sections
 9-301 and 9-307 of the UCC is set forth in Item A of Schedule II.
 

	
 

	
 

	
 

	
          (b)
 The jurisdiction (including the county) in which the Greens Creek Mine is
 located is set forth in Item B of Schedule II. 

	
 

	
 

	
 

	
          (c)
 Each location a secured party would have filed a UCC financing statement in
 the five years prior to the date hereof to perfect a security interest in any
 assets owned by such Grantor is set forth in Item C of Schedule II.
 

	
 

	
 

	
 

	
          (d)
 No Grantor has any trade names other than those set forth in Item D of
 Schedule II hereto. 

	
 

	
 

	
 

	
          (e)
 During the four months preceding the date hereof, no Grantor has been known
 by any legal name different from the one set forth on the signature page
 hereto, nor has such Grantor been the subject of any merger or other
 corporate reorganization, except as set forth in Item E of Schedule
 II hereto. 

	
 

	
 

	
 

	
          (f)
 Each Grantor’s federal taxpayer identification number is (and, during the
 four months preceding the date hereof, such Grantor has not had a federal
 taxpayer identification number different from that) set forth in Item F
 of Schedule II hereto. 

	
 

	
 

	
 

	
          (g)
 The name set forth on the signature page attached hereto is the true and
 correct legal name (as defined in the UCC) of each Grantor. 

          SECTION
3.3. Ownership, No Liens, etc. Each Grantor has rights in or the power
to transfer the Collateral, and owns its Collateral free and clear of any Lien,
except for Permitted Liens (as defined in the Credit Agreement). No effective
UCC financing statement or other filing similar in effect covering all or any
part of the Collateral is on file in any recording office, except those filed
in favor of the Administrative Agent relating to this Security Agreement. 

          SECTION
3.4. Validity, etc. 

	
 

	
 

	
 

	
          (a)
 This Security Agreement creates a valid security interest in the Collateral
 securing the payment of the Obligations. 

	
 

	
 

	
 

	
          (b)
 Each Grantor has filed or caused to be filed all UCC-1 financing statements
 in the filing offices set forth in Item A and Item B of Schedule
 II (collectively, the “Filing Statements”) (or has authenticated
 and delivered to the Administrative Agent the Filing Statements suitable for
 filing in such offices). 

	
 

	
 

	
 

	
          (c)
 Upon the filing of the Filing Statements with the appropriate agencies
 therefor the security interests created under this Security Agreement shall
 constitute a perfected security interest in the Collateral (other than
 Collateral described in clauses (iii)(E), (iii)(F), (iii)(G),
 (iii)(H), or (iii)(I) of Section 2.1(a) to the extent
 that a security interest therein cannot be perfected by filing pursuant to
 the UCC) in favor of the Administrative Agent on behalf of the Secured
 Parties, prior to all other Liens (except for Permitted Liens). 

          SECTION
3.5. Authorization, Approval, etc. Except as have been obtained or made
and are in full force and effect, no authorization, approval or other action
by, and no notice to or filing with, any Governmental Authority or any other
third party is required 

	
 

	
 

	
 

	
          (a)
 for the grant by the Grantors of the security interest granted hereby or for
 the execution, delivery and performance of this Security Agreement by the
 Grantors; 

	
 

	
 

	
 

	
          (b)
 for (i) the perfection or maintenance of the security interests hereunder
 including the first priority nature of such security interests (except with
 respect to the filing of the Filing Statements in accordance with Section
 3.4(b) and continuation statements with respect to the Filing Statements
 under Section 9-515(d) of the relevant UCC); or 

	
 

	
 

	
 

	
          (c)
 for the exercise by the Administrative Agent of the rights and remedies
 provided for in this Security Agreement, except notices that may be required
 under Sections 16.2(b) and (c) of the Greens Creek Joint Venture Agreement. 

          SECTION
3.6. Best Interests. It is in the best interests of each Grantor (other
than the Borrower) to execute this Security Agreement inasmuch as such Grantor
will, as a result of being a Subsidiary of the Borrower, derive substantial
direct and indirect benefits from the Credit Extensions made from time to time
to the Borrower by the Lenders pursuant to the Credit Agreement and the
execution and delivery of Lender Hedging Agreements and other Loan Documents
between the Borrower and certain Secured Parties, and each Grantor agrees that
the Secured Parties are relying on this representation in agreeing to make such
Loans and other extensions of credit pursuant to the Credit Agreement to the
Borrower. 

ARTICLE IV

COVENANTS

          Each
Grantors covenants and agrees that, until the Termination Date, such Grantor
will perform, comply with and be bound by the obligations set forth below. 

          SECTION
4.1. Collateral; Distributions; Voting Rights, etc. 

          (a)
Each Grantor agrees promptly upon receipt of notice of the occurrence and
continuance of a Specified Default from the Administrative Agent and without
any request therefor by the Administrative Agent, so long as such Specified
Default shall continue, to deliver (properly endorsed where required hereby or
requested by the Administrative Agent) to the Administrative Agent all
Collateral (including Proceeds to be distributed to (or payable to) such
Grantor) and all Distributions, in each case thereafter received by such
Grantor, all of which shall be held by the Administrative Agent as additional
Collateral. All such Collateral and Distributions that may at any time and from
time to time be held by such Grantor, but which such Grantor is then obligated
to deliver to the Administrative Agent, shall, until delivery to the
Administrative Agent, be held by such Grantor separate and apart from, and not
commingled with, its other property in trust for the Administrative Agent. The
Administrative Agent shall deposit Proceeds of Collateral in a Deposit Account
of such Grantor maintained with the Administrative Agent (the “Collateral
Account”); provided that the Administrative Agent shall have the
right to apply any amount in the Collateral Account to the payment of any
Obligations which are due and payable. With respect to any Collateral Account,
it is hereby confirmed and agreed that (i) deposits in such Collateral Account
are subject to a security interest as contemplated hereby, (ii) such Collateral
Account shall be under the control of the Administrative Agent and (iii) the
Administrative Agent shall have the sole right of withdrawal over such
Collateral Account. 

          (b)
The Administrative Agent agrees that unless a Specified Default shall have
occurred and be continuing and the Administrative Agent shall have given the
notice referred to in clause (a) of this Section, each Grantor will have
the exclusive voting power with respect to ownership interests constituting
Collateral and the Administrative Agent will, upon the written request of each
Grantor, promptly deliver such proxies and other documents, if any, as shall be
reasonably requested by such Grantor which are necessary to allow such Grantor
to exercise that voting power; provided that no vote shall be cast, or
consent, waiver, or ratification given, or action taken by such Grantor that
would impair any such Collateral or be inconsistent with or violate any
provision of any Loan Document. 

          SECTION
4.2. Continuous Pledge. Each Grantor will (subject to the terms of the
Credit Agreement) deliver to the Administrative Agent and at all times keep
pledged to the Administrative Agent pursuant hereto, on a first-priority,
perfected basis, all Collateral consisting of Payment Intangibles to the extent
they are evidenced by a Document, Instrument, Promissory Note or Chattel Paper,
all interest and principal with respect to such Payment Intangibles, and all
Proceeds and rights from time to time received by or distributable to the
applicable Grantor in respect of any of the foregoing Collateral. Each Grantor
agrees that it will, promptly following receipt thereof, deliver to the
Administrative Agent possession of all originals of negotiable 

Documents,
Instruments, Promissory Notes and Chattel Paper that it acquires following the
Effective Date. 

          SECTION
4.3. Change of Name, etc. No Grantor will change its name or place of
incorporation or organization or federal taxpayer identification number except
upon 30 days’ prior written notice to the Administrative Agent. 

          SECTION
4.4. As to Collateral Generally. 

	
 

	
 

	
 

	
          (a)
  Subject to clause (b) below and each Grantor’s rights under the Greens
  Creek Joint Venture, each Grantor will, at its own expense, endeavor to
  collect, as and when due, all amounts due with respect to any of the
  Collateral, including the taking of such action with respect to such
  collection as the Administrative Agent may request following the occurrence
  of a Specified Default or, in the absence of such request, as such Grantor
  may deem advisable. 

	
 

	
 

	
 

	
          (b)
  At any time following the occurrence and during the continuance of a
  Specified Default, whether before or after the maturity of any of the
  Obligations, the Administrative Agent may (i) revoke any or all of the rights
  of each Grantor set forth in clause (a), (ii) notify any parties
  obligated on any of the Collateral to make payment to the Administrative
  Agent of any amounts due or to become due thereunder and (iii) enforce
  collection of any of the Collateral by suit or otherwise and surrender,
  release, or exchange all or any part thereof, or compromise or extend or
  renew for any period (whether or not longer than the original period) any
  indebtedness thereunder or evidenced thereby. 

	
 

	
 

	
 

	
          (c)
  Upon request of the Administrative Agent following the occurrence and during
  the continuance of a Specified Default, each Grantor will, at its own
  expense, notify any parties obligated on any of the Collateral to make
  payment to the Administrative Agent of any amounts due or to become due
  thereunder. 

	
 

	
 

	
 

	
          (d)
  At any time following the occurrence and during the continuation of a
  Specified Default, the Administrative Agent may endorse, in the name of such
  Grantor, any item, howsoever received by the Administrative Agent,
  representing any payment on or other Proceeds of any of the Collateral. 

          SECTION
4.5. Transfers. No Grantor shall sell, assign (by operation of law or
otherwise) or otherwise dispose of any of the Collateral, except (i) Inventory
or Equipment in the ordinary course of business and (ii) as provided in the
Credit Agreement. 

          SECTION
4.6. Commercial Tort Claims. If any Grantor shall at any time hold or
acquire a commercial tort claim related to the Greens Creek Joint Venture that
has a reasonable possibility of yielding net proceeds in excess of $250,000,
such Grantor shall promptly notify the Administrative Agent thereof in a
writing signed by such Grantor including a summary description of such claim
and grant to the Administrative Agent in such writing a security interest
therein and in the proceeds thereof, all upon the terms of this Security
Agreement, with such writing to be in form and substance reasonably
satisfactory to the Administrative Agent. 

          SECTION
4.7. Further Assurances, etc. Each Grantor agrees that, from time to
time at its own expense, it will promptly execute and deliver all further
instruments and documents, and take all further action, that may be necessary
or that the Administrative Agent may reasonably request, in order to perfect,
preserve and protect any security interest granted or purported to be granted
hereby or to enable the Administrative Agent to exercise and enforce its rights
and remedies hereunder with respect to any Collateral. Without limiting the
generality of the foregoing, such Grantor will: 

	
 

	
 

	
 

	
          (a)
  from time to time upon the request of the Administrative Agent, promptly
  deliver to the Administrative Agent such stock powers, instruments and
  similar documents, satisfactory in form and substance to the Administrative
  Agent, with respect to such Collateral as the Administrative Agent may
  request and will, from time to time upon the request of the Administrative
  Agent, after the occurrence and during the continuance of any Specified
  Default, promptly transfer any securities constituting Collateral into the
  name of any nominee designated by the Administrative Agent; if any Collateral
  shall be evidenced by an Instrument, negotiable Document, Promissory Note or
  tangible Chattel Paper, deliver and pledge to the Administrative Agent
  hereunder such Instrument, negotiable Document, Promissory Note or tangible
  Chattel Paper duly endorsed and accompanied by duly executed instruments of
  transfer or assignment, all in form and substance satisfactory to the
  Administrative Agent; 

	
 

	
 

	
 

	
          (b)
  file (and hereby authorize the Administrative Agent to file) such Filing
  Statements or continuation statements, or amendments thereto, and such other
  instruments or notices (including any assignment of claim form under or
  pursuant to the federal assignment of claims statute, 31 U.S.C. § 3726, any
  successor or amended version thereof or any regulation promulgated under or
  pursuant to any version thereof), as may be necessary or that the
  Administrative Agent may request in order to perfect and preserve the
  security interests and other rights granted or purported to be granted to the
  Administrative Agent hereby; 

	
 

	
 

	
 

	
          (c)
  deliver to the Administrative Agent and at all times keep pledged to the
  Administrative Agent pursuant hereto, on a first-priority, perfected basis,
  at the request of the Administrative Agent, all interest and principal with
  respect to Promissory Notes with respect to the Collateral, and all Proceeds
  and rights from time to time received by or distributable to the applicable
  Grantor in respect of any of the foregoing Collateral; 

	
 

	
 

	
 

	
          (d)
  not take or omit to take any action the taking or the omission of which would
  result in any material impairment or alteration of any obligation of the
  maker of any Payment Intangible or other Instrument constituting Collateral,
  except as provided in Section 4.4; and 

	
 

	
 

	
 

	
          (e)
  not create any tangible Chattel Paper with respect to the Collateral without
  placing a legend on such tangible Chattel Paper acceptable to the
  Administrative Agent indicating that the Administrative Agent has a security
  interest in such Chattel Paper. 

With respect
to the foregoing and the grant of the security interest hereunder, each Grantor
hereby authorizes the Administrative Agent to file one or more financing or
continuation

statements,
and amendments thereto, relative to all or any part of the Collateral. Each
Grantor agrees that a carbon, photographic or other reproduction of this
Security Agreement or any UCC financing statement covering the Collateral or
any part thereof shall be sufficient as a UCC financing statement where
permitted by law. 

ARTICLE V 

THE ADMINISTRATIVE AGENT

          SECTION
5.1. Administrative Agent Appointed Attorney-in-Fact. Each Grantor
hereby irrevocably appoints the Administrative Agent its attorney-in-fact, with
full authority in the place and stead of such Grantor and in the name of such
Grantor or otherwise, from time to time in the Administrative Agent’s
discretion, following the occurrence and during the continuance of a Specified
Default, to take any action and to execute any instrument which the
Administrative Agent may deem necessary or advisable to accomplish the purposes
of this Security Agreement, including: 

	
 

	
 

	
 

	
          (a)
  to ask, demand, collect, sue for, recover, compromise, receive and give
  acquittance and receipts for moneys due and to become due under or in respect
  of any of the Collateral; 

	
 

	
 

	
 

	
          (b)
  to receive, endorse and collect any drafts or other writings in connection
  with clause (a) above; 

	
 

	
 

	
 

	
          (c)
  to file any claims or take any action or institute any proceedings which the
  Administrative Agent may deem necessary or desirable for the collection of
  any of the Collateral or otherwise to enforce the rights of the
  Administrative Agent with respect to any of the Collateral, including such
  actions as it deems necessary or desirable under or with respect to the
  Greens Creek Joint Venture Agreement; and 

	
 

	
 

	
 

	
          (d)
  to perform the affirmative obligations of such Grantor hereunder. 

Each Grantor
hereby acknowledges, consents and agrees that the power of attorney granted
pursuant to this Section is irrevocable and coupled with an interest. 

          SECTION
5.2. Administrative Agent May Perform. If any Grantor fails to perform
any agreement contained herein, the Administrative Agent may itself perform, or
cause performance of, such agreement, and the reasonable expenses of the
Administrative Agent incurred in connection therewith shall be payable by such
Grantor pursuant to Section 10.3 of the Credit Agreement. 

          SECTION
5.3. Administrative Agent Has No Duty. The powers conferred on the
Administrative Agent hereunder are solely to protect its interest (on behalf of
the Secured Parties) in the Collateral and shall not impose any duty on it to
exercise any such powers. Except for reasonable care of any Collateral in its
possession and the accounting for moneys actually received by it hereunder, the
Administrative Agent shall have no duty as to any Collateral or responsibility
for 

	
 

	
 

	
 

	
          (a)
  ascertaining or taking action with respect to calls, conversions, exchanges,
  maturities, tenders or other matters relative to any Collateral, whether or not
  the Administrative Agent has or is deemed to have knowledge of such matters,
  or 

	
 

	
 

	
 

	
          (b)
  taking any necessary steps to preserve rights against prior parties or any
  other rights pertaining to any Collateral. 

          SECTION
5.4. Reasonable Care. The Administrative Agent is required to exercise
reasonable care in the custody and preservation of any of the Collateral in its
possession; provided that the Administrative Agent shall be deemed to
have exercised reasonable care in the custody and preservation of any of the
Collateral, if it takes such action for that purpose as each Grantor reasonably
requests in writing at times other than upon the occurrence and during the
continuance of any Specified Default, but failure of the Administrative Agent
to comply with any such request at any time shall not in itself be deemed a
failure to exercise reasonable care. 

ARTICLE VI

REMEDIES

          SECTION
6.1. Certain Remedies. If any Specified Default shall have occurred and
be continuing: 

	
 

	
 

	
 

	
          (a)
  The Administrative Agent may exercise in respect of the Collateral, in
  addition to other rights and remedies provided for herein or otherwise
  available to it, all the rights and remedies of a Secured Party on default
  under the UCC (whether or not the UCC applies to the affected Collateral) and
  also may: 

	
 

	
 

	
 

	
          (i)
  take possession of any Collateral not already in its possession without
  demand and without legal process; 

	
 

	
 

	
 

	
          (ii)
  require each Grantor to, and each Grantor hereby agrees that it will, at its
  expense and upon written 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 to be
  designated by the Administrative Agent that is reasonably convenient to both
  parties, 

	
 

	
 

	
 

	
          (iii)
  enter onto the property where any Collateral is located and take possession
  thereof without demand and without legal process; 

	
 

	
 

	
 

	
          (iv)
  without notice except as specified below, lease, license, sell or otherwise
  dispose of the Collateral or any part thereof in one or more parcels at
  public or private sale, at any of the Administrative Agent’s offices or
  elsewhere, for cash, on credit or for future delivery, and upon such other
  terms as the Administrative Agent may deem commercially reasonable. Each
  Grantor agrees that, to the extent notice of sale shall be required by law,
  at least ten days’ prior notice to such Grantor of the time and place of any
  public sale or the time after which any private sale is to be made shall
  constitute reasonable notification. The 

	
 

	
 

	
 

	
Administrative
  Agent shall not be obligated to make any sale of Collateral regardless of
  notice of sale having been given. The Administrative Agent may adjourn any
  public or private sale from time to time by announcement at the time and
  place fixed therefor, and such sale may, without further notice, be made at
  the time and place to which it was so adjourned. 

	
 

	
 

	
 

	
          (b)
  All cash Proceeds received by the Administrative Agent in respect of any sale
  of, collection from, or other realization upon, all or any part of the
  Collateral shall be applied by the Administrative Agent against all or any
  part of the Obligations as set forth in Section 4.7 of the Credit Agreement. 

	
 

	
 

	
 

	
(c) The
  Administrative Agent may: 

	
 

	
 

	
 

	
          (i)
  transfer all or any part of the Collateral into the name of the
  Administrative Agent or its nominee, with or without disclosing that such
  Collateral is subject to the Lien hereunder; 

	
 

	
 

	
 

	
          (ii)
  notify the parties obligated on any of the Collateral to make payment to the
  Administrative Agent of any amount due or to become due thereunder; 

	
 

	
 

	
 

	
          (iii)
  withdraw, or cause or direct the withdrawal, of all funds with respect to the
  Collateral Account; 

	
 

	
 

	
 

	
          (iv)
  enforce collection of any of the Collateral by suit or otherwise, and
  surrender, release or exchange all or any part thereof, or compromise or
  extend or renew for any period (whether or not longer than the original
  period) any obligations of any nature of any party with respect thereto; 

	
 

	
 

	
 

	
          (v)
  endorse any checks, drafts, or other writings in any Grantor’s name to allow
  collection of the Collateral; 

	
 

	
 

	
 

	
          (vi)
  take control of any Proceeds of the Collateral; and 

	
 

	
 

	
 

	
          (vii)
  execute (in the name, place and stead of any Grantor) endorsements,
  assignments, stock powers and other instruments of conveyance or transfer
  with respect to all or any of the Collateral. 

          SECTION
6.2. Compliance with Restrictions. Each Grantor agrees that, in any sale
of any of the Collateral whenever a Specified Default shall have occurred and
be continuing, the Administrative Agent is hereby authorized to comply with any
limitation or restriction in connection with such sale as it may be advised by
counsel is necessary in order to avoid any violation of applicable law
(including compliance with such procedures as may restrict the number of
prospective bidders and purchasers, require that such prospective bidders and
purchasers have certain qualifications, and restrict such prospective bidders
and purchasers to Persons who will represent and agree that they are purchasing
for their own account for investment and not with a view to the distribution or
resale of such Collateral), or in order to obtain any required approval of the
sale or of the purchaser by any Governmental Authority or 

official, and
such Grantor further agrees that such compliance shall not result in such sale being
considered or deemed not to have been made in a commercially reasonable manner,
nor shall the Administrative Agent be liable nor accountable to such Grantor
for any discount allowed by the reason of the fact that such Collateral is sold
in compliance with any such limitation or restriction. 

          SECTION
6.3. Protection of Collateral. The Administrative Agent may from time to
time, at its option, perform any act which any Grantor fails to perform after
being requested in writing so to perform (it being understood that no such
request need be given after the occurrence and during the continuance of a
Specified Default) and the Administrative Agent may from time to time take any
other action which the Administrative Agent deems necessary for the maintenance,
preservation or protection of any of the Collateral or of its security interest
therein. 

ARTICLE VII 

MISCELLANEOUS PROVISIONS

          SECTION
7.1. Loan Document. This Security Agreement is a Loan Document executed
pursuant to the Credit Agreement and shall (unless otherwise expressly
indicated herein) be construed, administered and applied in accordance with the
terms and provisions thereof, including Article X thereof. 

          SECTION
7.2. Binding on Successors, Transferees and Assigns; Assignment. This
Security Agreement shall remain in full force and effect until the Termination
Date has occurred, shall be binding upon the Grantors and their successors,
transferees and assigns and shall inure to the benefit of and be enforceable by
each Secured Party and its successors, transferees and assigns; provided that
no Grantor may (unless otherwise permitted under the terms of the Credit
Agreement or this Security Agreement) assign any of its obligations hereunder
without the prior written consent of all Lenders. 

          SECTION
7.3. Amendments, etc. No amendment to or waiver of any provision of this
Security Agreement, nor consent to any departure by any Grantor from its
obligations under this Security Agreement, shall in any event be effective
unless the same shall be in writing and signed by the Administrative Agent (on
behalf of the Lenders or the Required Lenders, as the case may be, pursuant to
Section 10.1 of the Credit Agreement) and the Grantors and then such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given. 

          SECTION
7.4. Notices. All notices and other communications provided for
hereunder shall be in writing or by facsimile and addressed, delivered or
transmitted to the appropriate party at the address or facsimile number of such
party specified in the Credit Agreement or at such other address or facsimile
number as may be designated by such party in a notice to the other party. Any
notice or other communication, if mailed and properly addressed with postage
prepaid or if properly addressed and sent by pre-paid courier service, shall be
deemed given when received; any notice or other communication, if transmitted
by facsimile, shall be deemed given when the confirmation of transmission
thereof is received by the transmitter. 

          SECTION
7.5. Release of Liens. Upon (a) the Disposition of Collateral in
accordance with the Credit Agreement or (b) the occurrence of the Termination
Date, the security interests granted herein shall automatically terminate with
respect to (i) such Collateral (in the case of clause (a)) or (ii) all
Collateral (in the case of clause (b)), without delivery of any
instrument or performance of any act by any party. Upon the occurrence of the
Termination Date, this Security Agreement and all obligations of each Grantor
hereunder shall automatically terminate without delivery of any instrument or
performance of any act by any party. A Grantor shall automatically be released
from its obligations hereunder upon the consummation of any transaction permitted
by the Credit Agreement as a result of which such Grantor ceases to be a
Subsidiary of the Borrower and any of its Subsidiaries. Upon any such
Disposition, other permitted transaction or termination, the Administrative
Agent will, at each Grantor’s sole expense, deliver to each Grantor, without
any representations, warranties or recourse of any kind whatsoever, all
Collateral held by the Administrative Agent hereunder, and execute and deliver
to each Grantor such documents as such Grantor shall reasonably request to
evidence such termination. 

          SECTION
7.6. No Waiver; Remedies. In addition to, and not in limitation of Section
2.4, no failure on the part of any Secured Party to exercise, and no delay
in exercising, any right hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise of any right hereunder preclude any other or
further exercise thereof or the exercise of any other right. The remedies
herein provided are cumulative and not exclusive of any remedies provided by
law. 

          SECTION
7.7. Headings. The various headings of this Security Agreement are
inserted for convenience only and shall not affect the meaning or
interpretation of this Security Agreement or any provisions thereof. 

          SECTION
7.8. Severability. Any provision of this Security Agreement which is prohibited
or unenforceable in any jurisdiction shall, as to such provision and such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions of this Security
Agreement or affecting the validity or enforceability of such provision in any
other jurisdiction.  

          SECTION
7.9. Governing Law. THIS SECURITY AGREEMENT SHALL BE DEEMED TO BE A
CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK
(INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE GENERAL
OBLIGATIONS LAW OF THE STATE OF NEW YORK), EXCEPT TO THE EXTENT THAT THE
PERFECTION, EFFECT OF PERFECTION OR NONPERFECTION, AND PRIORITY OF THE SECURITY
INTEREST HEREUNDER, OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR
COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF
NEW YORK. 

          SECTION
7.10. Forum Selection and Consent to Jurisdiction. ANY LITIGATION BASED
HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, ANY LOAN DOCUMENT, OR
ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN)
OR ACTIONS OF THE 

ADMINISTRATIVE
AGENT, THE SECURED PARTIES OR ANY GRANTOR IN CONNECTION HEREWITH OR THEREWITH
MAY BE BROUGHT AND MAINTAINED IN THE COURTS OF THE STATE OF NEW YORK OR IN THE
UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK; PROVIDED
THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY PROPERTY MAY BE BROUGHT, AT THE
ADMINISTRATIVE AGENT’S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH
PROPERTY MAY BE FOUND. EACH GRANTOR HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO
THE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK, NEW YORK COUNTY AND OF
THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK FOR THE
PURPOSE OF ANY SUCH LITIGATION AS SET FORTH ABOVE AND IRREVOCABLY AGREES TO BE
BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH SUCH LITIGATION. EACH
GRANTOR IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY REGISTERED MAIL,
POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF NEW YORK
AT THE ADDRESS FOR NOTICES SPECIFIED FOR THE BORROWER IN SECTION 10.2 OF THE
CREDIT AGREEMENT. EACH GRANTOR HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE OR HEREAFTER
MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH
COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT
IN AN INCONVENIENT FORUM. TO THE EXTENT THAT ANY GRANTOR HAS OR HEREAFTER MAY
ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS
(WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN
AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, SUCH
GRANTOR HEREBY IRREVOCABLY WAIVES TO THE FULLEST EXTENT PERMITTED BY LAW SUCH
IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THE LOAN DOCUMENTS. 

          SECTION
7.11. Waiver of Jury Trial. THE ADMINISTRATIVE AGENT (ON BEHALF OF
ITSELF AND EACH OTHER SECURED PARTY) AND EACH GRANTOR HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE TO THE FULLEST EXTENT PERMITTED BY LAW ANY
RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON,
OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, EACH LOAN DOCUMENT, OR ANY
COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR
ACTIONS OF THE ADMINISTRATIVE AGENT, SUCH SECURED PARTY OR EACH GRANTOR IN
CONNECTION THEREWITH. EACH GRANTOR ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED
FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION (AND EACH OTHER PROVISION
OF EACH OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY) AND THAT THIS PROVISION IS
A MATERIAL INDUCEMENT FOR THE ADMINISTRATIVE AGENT, AND EACH SECURED PARTY
ENTERING INTO THE LOAN DOCUMENTS. 

          SECTION
7.12. Counterparts. This Security Agreement may be executed by the
parties hereto in several counterparts, each of which shall be deemed to be an
original and all of which

 shall constitute together but one and the
same agreement. Delivery of an executed counterpart of a signature page to this
Security Agreement by facsimile shall be effective as delivery of an original
executed counterpart of this Security Agreement. 

          IN
WITNESS WHEREOF, each of the parties hereto has caused this Security Agreement
to be duly executed and delivered by its Authorized Officer as of the date
first above written. 

	
 

	
 

	
 

	
 

	
 

	
HECLA MINING
  COMPANY

	
 

	
 

	
 

	
 

	
 

	
 

	
By:

	
 

	
 

	
 

	
 

	 

	
 

	
 

	
 

	
Name:

	
 

	
 

	
 

	
Title:

	
 

	
 

	
 

	
 

	
 

	
 

	
HECLA ALASKA
  LLC

	
 

	
 

	
 

	
 

	
 

	
 

	
By:

	
Hecla
  Limited,

	
 

	
 

	
 

	
its Managing
  Member

	
 

	
 

	
 

	
 

	
 

	
 

	
By:

	
 

	
 

	
 

	
 

	 

	
 

	
 

	
 

	
 

	
Name:

	
 

	
 

	
 

	
Title:

	
 

	
 

	
 

	
 

	
 

	
 

	
KENNECOTT
  GREENS CREEK MINING COMPANY

	
 

	
 

	
 

	
 

	
 

	
 

	
By:

	
 

	
 

	
 

	
 

	 

	
 

	
 

	
 

	
Name:

	
 

	
 

	
 

	
Title:

	
 

	
 

	
 

	
 

	
 

	
 

	
KENNECOTT
  JUNEAU MINING COMPANY

	
 

	
 

	
 

	
 

	
 

	
 

	
By:

	
 

	
 

	
 

	
 

	 

	
 

	
 

	
 

	
Name:

	
 

	
 

	
 

	
Title:

	
 

Amended and Restated Security Agreement

          IN
WITNESS WHEREOF, each of the parties hereto has caused this Security Agreement
to be duly executed and delivered by its Authorized Officer as of the date
first above written. 

 

	
 

	
 

	
 

	
 

	
 

	
THE BANK OF
NOVA SCOTIA, 
 as Administrative Agent

	
 

	
 

	
 

	
 

	
 

	
 

	
By:

	
 

	
 

	
 

	
 

	 

	
 

	
 

	
 

	
Name:

	
 

	
 

	
 

	
Title:

	
 

Amended
and Restated Security Agreement 

ANNEX I 

to Amended and Restated Security Agreement 

Intellectual Property Collateral Definitions

          “Computer
Hardware and Software Collateral” means, with respect to the Greens Creek
Joint Venture: 

	
 

	
 

	
 

	
          (a)
  all computer and other electronic data processing hardware, integrated
  computer systems, central processing units, memory units, display terminals,
  printers, features, computer elements, card readers, tape drives, hard and
  soft disk drives, cables, electrical supply hardware, generators, power
  equalizers, accessories and all peripheral devices and other related computer
  hardware, including all operating system software, utilities and application
  programs in whatsoever form; 

	
 

	
 

	
 

	
          (b)
  all software programs (including both source code, object code and all
  related applications and data files), designed for use on the computers and
  electronic data processing hardware described in clause (a) above; 

	
 

	
 

	
 

	
          (c)
  all firmware associated therewith; 

	
 

	
 

	
 

	
          (d)
  all documentation (including flow charts, logic diagrams, manuals, guides,
  specifications, training materials, charts and pseudo codes) with respect to
  such hardware, software and firmware described in the preceding clauses
  (a) through (c); and 

	
 

	
 

	
 

	
          (e)
  all rights with respect to all of the foregoing, including copyrights,
  licenses, options, warranties, service contracts, program services, test
  rights, maintenance rights, support rights, improvement rights, renewal
  rights and indemnifications and any substitutions, replacements,
  improvements, error corrections, updates, additions or model conversions of
  any of the foregoing. 

          “Copyright
Collateral” means, with respect to the Greens Creek Joint Venture, all
copyrights, registered or unregistered and whether published or unpublished,
now or hereafter in force throughout the world including all of the Greens
Creek Joint Venture’s rights, titles and interests in and to all copyrights
registered in the United States Copyright Office or anywhere else in the world
and registrations and recordings thereof and all applications for registration
thereof, whether pending or in preparation, all copyright licenses, the right
to sue for past, present and future infringements of any of the foregoing, all
rights corresponding thereto, all extensions and renewals of any thereof and
all Proceeds of the foregoing, including licenses, royalties, income, payments,
claims, damages and Proceeds of suit, which are owned or licensed by the Greens
Creek Joint Venture. 

          “Patent
Collateral” means, with respect to the Greens Creek Joint Venture: 

	
 

	
 

	
 

	
          (f)
  inventions and discoveries, whether patentable or not, all letters patent and
  applications for letters patent throughout the world; 

	
 

	
 

	
 

	
          (g)
all reissues, divisions, continuations, continuations-in-part, extensions,
renewals and reexaminations of any of the items described in clause (a);  

	
 

	
 

	
 

	
          (h)
all patent licenses, and other agreements providing the Greens Creek Joint
Venture with the right to use any items of the type referred to in clauses
(a) and (b) above; and  

	
 

	
 

	
 

	
          (i)
  all Proceeds of, and rights associated with, the foregoing (including
  licenses, royalties income, payments, claims, damages and Proceeds of
  infringement suits), the right to sue third parties for past, present or
  future infringements of any patent or patent application, and for breach or
  enforcement of any patent license. 

	
 

	
 

	
 

	
“Trademark
  Collateral” means, with respect to the Greens Creek Joint Venture: 

	
 

	
 

	
 

	
          (a)
(i) all trademarks, trade names, corporate names, company names, business
names, fictitious business names, trade styles, service marks, certification
marks, collective marks, logos and other source or business identifiers, and
all goodwill of the business associated therewith, now existing or hereafter
adopted or acquired, whether currently in use or not, all registrations and
recordings thereof and all applications in connection therewith, whether
pending or in preparation for filing, including registrations, recordings and
applications in the United States Patent and Trademark Office or in any
office or agency of the United States of America, or any State thereof or any
other country or political subdivision thereof or otherwise, and all common-law
rights relating to the foregoing, and (ii) the right to obtain all reissues,
extensions or renewals of the foregoing (collectively referred to as the
“Trademark”);  

	
 

	
 

	
 

	
          (b)
  all trademark licenses for the grant by or to the Greens Creek Joint Venture
  of any right to use any trademark; and 

	
 

	
 

	
 

	
          (c)
  all of the goodwill of the business connected with the use of, and symbolized
  by the items described in, clause (a), and to the extent applicable clause
  (b); 

	
 

	
 

	
 

	
          (d)
  the right to sue third parties for past, present and future infringements of
  any Trademark Collateral described in clause (a) and, to the extent
  applicable, clause (b); and 

	
 

	
 

	
 

	
          (e)
  all Proceeds of, and rights associated with, the foregoing, including any
  claim by Greens Creek Joint Venture against third parties for past, present
  or future infringement or dilution of any Trademark, Trademark registration
  or Trademark license, or for any injury to the goodwill associated with the
  use of any such Trademark or for breach or enforcement of any Trademark
  license and all rights corresponding thereto throughout the world. 

          “Trade
Secrets Collateral” means, with respect to the Greens Creek Joint Venture,
all common law and statutory trade secrets and all other confidential,
proprietary or useful information and all know-how obtained by or used in or
contemplated at any time for use in the business of the Greens Creek Joint
Venture (all of the foregoing being collectively called a “Trade Secret”),
whether or not such Trade Secret has been reduced to a writing or other
tangible 

form,
including all Documents and things embodying, incorporating or referring in any
way to such Trade Secret, all Trade Secret licenses, and including the right to
sue for and to enjoin and to collect damages for the actual or threatened
misappropriation of any Trade Secret and for the breach or enforcement of any
such Trade Secret license. 

SCHEDULE I

to Amended and Restated Security Agreement 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Participating Interests

	
 

	
 

	
 

	
 

	 

	
 

	
ISSUER (JOINT VENTURE)

	
 

	
 

	
% of Participating

  Interests Owned

	
 

	
% of Participating 

  Interests Pledged

	
 

	 

	
 

	
 

	 

	
 

	 

SCHEDULE II
 to Amended and Restated Security
Agreement 

	
 

	
 

	
Item A.

	
Location of
  each Grantor.

	
 

	
 

	
Item B.

	
Location of
  Greens Creek Mine.

	
 

	
 

	
Item C.

	
Filing
  locations last five years.

	
 

	
 

	
Item D.

	
Trade names.

	
 

	
 

	
Item E.

	
Merger or
  other corporate reorganization.

	
 

	
 

	
Item F.

	
Taxpayer ID
  numbers.

EXHIBIT I 

FORM OF INTERCO SUBORDINATION AGREEMENT

          THIS
INTERCO SUBORDINATION AGREEMENT (this “Subordination Agreement”), dated
as of ____________, 200_, made by and among each of the undersigned Persons
(such capitalized term, and other terms used in these recitals without
definition, to have the meanings ascribed thereto in Section 1 below)
and such other Persons that may from time to time become a party hereto
pursuant to the terms hereof or of the Credit Agreement (collectively, the “Subordinated
Creditors”) and HECLA MINING COMPANY, a Delaware corporation (the “Borrower”),
in favor of The Bank of Nova Scotia, as administrative agent (in such capacity,
the “Administrative Agent”) for the Lenders, and each of the Secured
Parties. 

W I T N E S S E T H:

          WHEREAS,
the Borrower has entered into an Amended and Restated Credit Agreement, dated
as of April [__], 2008 (as amended, supplemented, amended and restated,
extended, renewed, refinanced, replaced or otherwise modified from time to
time, the “Credit Agreement”), among the Borrower, the Lenders, the
Administrative Agent and Scotia Capital, as Lead Arranger, pursuant to which
the Lenders have agreed to make Credit Extensions on the terms and subject to
the conditions set forth therein; 

          WHEREAS,
the Borrower is now or may hereafter from time to time become indebted or
otherwise obligated to the Subordinated Creditors in respect of Indebtedness
related to or resulting from intercompany loans, advances or other obligations
from a Subordinated Creditor (all such present and future Indebtedness owing to
the Subordinated Creditors (whether created directly or acquired by assignment
or otherwise), and interest, premiums and fees, if any, thereon and other
amounts payable in respect thereof and all rights and remedies of the
Subordinated Creditors with respect thereto, being referred to as the “Intercompany
Subordinated Debt”); 

          WHEREAS,
pursuant to Section 7.2.2(f) of the Credit Agreement, each Subordinated
Creditor is required to execute and deliver this Subordination Agreement; and 

          WHEREAS,
each Subordinated Creditor has duly authorized the execution, delivery and
performance of this Subordination Agreement. 

          NOW,
THEREFORE, in consideration of the above premises and to induce the Lenders to
continue to make Credit Extensions to the Borrower pursuant to the Credit
Agreement, and to induce Secured Parties to enter into Lender Hedging
Agreements and other Loan Documents, and for other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, the parties hereto
hereby agree as follows: 

AGREEMENT

          SECTION
1. Definitions. Terms used but not defined in this Subordination
Agreement, including its preamble and recitals, have the meanings given to them
in the Credit Agreement. 

As used in
this Subordination Agreement, the following terms shall have the meanings
specified below: 

          “Administrative
Agent” is defined in the preamble. 

          “Borrower”
is defined in the preamble. 

          “Credit
Agreement” is defined in the first recital. 

          “Intercompany
Subordinated Debt” is defined in the second recital. 

          “Loan
Documents” means the Loan Documents, as defined in the Credit Agreement,
together with the following: Lender Hedging Agreements and each other agreement
which evidences an Obligation or under which an Obligation arises. 

          “Senior
Indebtedness” is defined in clause (a) of Section 2. 

          “Subordinated
Creditors” is defined in the preamble. 

          “Subordination
Agreement” is defined in the preamble. 

          SECTION
2. Agreement to Subordinate. 

          (a)
Each of the Borrower and the Subordinated Creditors agrees that the
Intercompany Subordinated Debt is and shall be subject, subordinate and
rendered junior, to the extent and in the manner hereinafter set forth, in
right of payment, to the prior indefeasible payment in cash in full of all
Obligations of the Borrower now existing or hereafter arising under the Credit
Agreement or any Loan Document whether for (i) interest (including, without
limitation, interest accruing after the filing of a petition initiating any
proceeding referred to in clause (a) of Section 3, whether or not
allowed as a claim in such proceeding), (ii) costs, (iii) fees (including,
without limitation, reasonable attorneys’ fees and disbursements), (iv)
expenses, and (v) otherwise (the Obligations specified in clauses (a)(i)
through (a)(v) above are referred to collectively as the “Senior
Indebtedness”). For the purposes of this Subordination Agreement, the
Senior Indebtedness shall not be deemed to have been indefeasibly paid in cash
in full until the Secured Parties shall have received full payment of the
Senior Indebtedness in cash, which payment shall have been retained by the
Secured Parties for a period of time in excess of all applicable preference or
other similar periods under applicable bankruptcy, insolvency or creditors’
rights laws. Each of the Borrower and the Subordinated Creditors waive notice
of acceptance of this Subordination Agreement by the Secured Parties, and the
Subordinated Creditors waive notice of and consent to the making, amount and
terms of the Senior Indebtedness which may exist or be created from time to
time and any renewal, extension, amendment, refinancing, replacement or
modification thereof (including any increase in the amount of Senior
Indebtedness), and any other lawful action which any Secured Party in its sole
and absolute discretion may take or omit to take with respect thereto. The
provisions of this Section shall constitute a continuing offer made for the
benefit of and to all Secured Parties, and each Secured Party is hereby
irrevocably authorized to enforce such provisions. 

          (b)
In the event that the Borrower shall make, and/or any Subordinated Creditor
shall receive, any payment on Intercompany Subordinated Debt in contravention
of this Subordination Agreement or the terms of the Credit Agreement, then and
in any such event such payment shall be deemed to be the property of and
segregated, received and held in trust for the benefit of, the Administrative
Agent, and shall be promptly paid over and delivered to the Administrative
Agent for the pro rata benefit of the Secured Parties.  

          (c)
The Borrower shall not make, and no Subordinated Creditor shall receive or
accept, any payment in respect of Intercompany Subordinated Debt if a Default
has occurred and is continuing under the Credit Agreement or would result
therefrom, unless and until the Senior Indebtedness has been indefeasibly paid
in cash in full or the Administrative Agent (in consultation with the Lenders)
has otherwise consented in writing. For purposes of these provisions, “payment”
in respect of any Intercompany Subordinated Debt shall include any direct or
indirect payment or distribution from any source, whether in cash, property or
securities, by set-off or otherwise, in respect of principal, premium, interest
or otherwise, including in connection with any redemption or purchase of such
Intercompany Subordinated Debt or any recovery on any claim for rescission or
damages. 

          SECTION
3. In Furtherance of Subordination. 

          (a)
Upon any distribution of all or any of the assets of the Borrower or any
Subordinated Creditor in the event of 

          (i)
any insolvency or bankruptcy case or proceeding, or any receivership,
liquidation, reorganization or other similar case or proceeding in connection
therewith, relative to the Borrower or such Subordinated Creditor, or to its
creditors, as such, or to its assets, 

          (ii)
any liquidation, dissolution or other winding up of the Borrower or any
Subordinated Creditor, whether voluntary or involuntary and whether or not
involving insolvency or bankruptcy, or 

          (iii)
any assignment for the benefit of creditors or any marshaling of assets and
liabilities of the Borrower or any Subordinated Creditor, 

	
 

	
 

	
 

	
then, and in
 any such event, unless the Secured Parties shall otherwise agree in writing,
 the Secured Parties shall receive indefeasible payment in cash in full of all
 amounts due or to become due (whether or not the Senior Indebtedness has been
 declared due and payable prior to the date on which the Senior Indebtedness
 would otherwise have become due and payable) on or in respect of all Senior
 Indebtedness (including post-petition interest, whether or not allowed as a
 claim) before the Subordinated Creditors or anyone claiming through or on
 their behalf (including any receiver, trustee, or otherwise) are entitled to
 receive any payment on account of principal of (or premium, if any) or
 interest on or other amounts payable in respect of the Intercompany
 Subordinated Debt, and to that end any payment or distribution of any kind or
 character, whether in cash, property or securities, which may be payable or
 deliverable in respect of the Intercompany Subordinated Debt in any such
 case, proceeding, dissolution, liquidation or other winding up or event,
 shall be paid or delivered directly to the Administrative Agent for the 

	
 

	
 

	
 

	
application
 (in the case of cash) to, or as collateral (in the case of non-cash property
 or securities) for, the payment or prepayment of the Senior Indebtedness
 until the Senior Indebtedness shall have been indefeasibly paid in cash in
 full.

          (b)
If any proceeding, liquidation, dissolution or winding up referred to in clause
(a) above is commenced by or against the Borrower or any Subordinated
Creditor, 

          (i)
the Administrative Agent or the Secured Parties are hereby irrevocably
authorized and empowered (in their own names or in the name of the Borrower,
the Subordinated Creditors or otherwise), but shall have no obligation, to
demand, sue for, collect and receive every payment or distribution in respect
of the Intercompany Subordinated Debt above and give acquittance therefor and
to file claims and proofs of claim and take such other action (including,
without limitation, voting the Intercompany Subordinated Debt or enforcing any
security interest or other lien securing payment of the Intercompany
Subordinated Debt) as the Secured Parties or the Administrative Agent may deem
necessary or advisable for the exercise or enforcement of any of the rights or
interests of the Secured Parties or the Administrative Agent hereunder; provided,
that, in the event the Administrative Agent or the Secured Parties take such
action, the Administrative Agent or the Secured Parties shall apply all
proceeds first, to the payment of the costs of enforcement of this
Subordination Agreement, and second, to the pro rata payment,
prepayment and/or cash collateralization of the Senior Indebtedness in a manner
consistent with the provisions set forth in Section 3.1.1 of the Credit
Agreement; and 

          (ii)
the Subordinated Creditors shall duly and promptly take such action as the
Administrative Agent may reasonably request (A) to collect the Intercompany
Subordinated Debt for account of the Secured Parties and the Administrative
Agent and to file appropriate claims or proofs of claim in respect of the
Intercompany Subordinated Debt, (B) to execute and deliver to the
Administrative Agent such powers of attorney, assignments, or other instruments
as the Administrative Agent may reasonably request to enable them to enforce
any and all claims with respect to, and any security interests and other liens
securing payment of, the Intercompany Subordinated Debt and (C) to collect and
receive any and all payments or distributions which may be payable or
deliverable upon or with respect to the Intercompany Subordinated Debt. 

          (c)
All payments or distributions of assets of the Borrower, whether in cash,
property or securities upon or with respect to the Intercompany Subordinated
Debt which are received by the Subordinated Creditors contrary to the provisions
of this Subordination Agreement shall be received in trust for the pro rata
benefit of the Secured Parties, shall be segregated from other funds and
property held by the Subordinated Creditors and shall be forthwith paid over to
the Administrative Agent in the same form as so received (with any necessary
indorsement) to be applied, pro rata (in the case of cash) to, or
held as collateral (in the case of noncash property or securities) for, the
payment or prepayment of the Senior Indebtedness, whether matured or unmatured,
in accordance with the terms of this Subordination Agreement. 

          (d)
The Secured Parties and the Administrative Agent are hereby authorized to
demand specific performance of this Subordination Agreement, whether or not the
Borrower or any Subordinated Creditor shall have complied with any of the
provisions hereof applicable to it, at any time when the Subordinated Creditors
or any one of them shall have failed to comply 

with any of
the provisions of this Subordination Agreement applicable to it. The
Subordinated Creditors hereby irrevocably waive any defense (other than the
defense of indefeasible payment in full of the Senior Indebtedness) based on
the adequacy of a remedy at law which might be asserted as a bar to such remedy
of specific performance. 

          SECTION
4. No Enforcement or Commencement of Any Proceedings. Each Subordinated
Creditor agrees that, so long as any Senior Indebtedness shall remain unpaid,
or any Commitment shall be in effect, it will not accelerate the maturity of
the Intercompany Subordinated Debt or take any action or commence any
proceeding to enforce or, so long as a Default shall have occurred and be
continuing, collect same, or commence, or join with any creditor other than the
Secured Parties in commencing any proceeding referred to in clause (a)
of Section 3.  

          SECTION
5. Rights of Subordination. The Subordinated Creditors agree that no
payment or distribution to the Lenders or the Administrative Agent pursuant to
the provisions of this Subordination Agreement shall entitle the Subordinated
Creditors to exercise any rights of subrogation in respect thereof until all
Senior Indebtedness has been indefeasibly paid in cash in full and the
Commitments have been terminated. The Subordinated Creditors agree that the
subordination provisions contained herein shall not be affected by any action,
or failure to act, by the Administrative Agent or the Secured Parties which
results, or may result, in affecting, impairing or extinguishing any right of
reimbursement or subrogation or other right or remedy of the Subordinated
Creditors against the Borrower. 

          SECTION
6. Subordination Legend; Further Assurances. The Subordinated Creditors
and the Borrower will cause each note and instrument (if any) evidencing the
Intercompany Subordinated Debt to be endorsed with the following legend: 

	
 

	
 

	
 

	
 

	
“The
 indebtedness evidenced by this instrument is subordinated to the prior
 indefeasible payment in cash in full of the Senior Indebtedness (as defined
 in the Subordination Agreement, dated as of [_______]) pursuant to, and to
 the extent provided in, the Subordination Agreement by the maker hereof and
 payee named herein in favor of the Secured Parties and any person now or
 hereafter designated as their agent.” 

	
 

Each of the
Subordinated Creditors and the Borrower hereby agrees to mark its books of
account in such a manner as shall be effective to give proper notice of the
effect of this Subordination Agreement and will, in the case of any
Intercompany Subordinated Debt not evidenced by any note or instrument,
following the occurrence and continuation of an Event of Default, upon the
Administrative Agent’s request, cause such Intercompany Subordinated Debt to be
evidenced by an appropriate note or instrument or instruments endorsed with the
above legend. Each of the Subordinated Creditors and the Borrower will at its
expense and at any time and from time to time promptly execute and deliver all
further instruments and documents and take all further action that may be
necessary or that the Secured Parties or the Administrative Agent may
reasonably request to protect any right or interest granted or purported to be
granted hereunder or to enable the Secured Parties or the Administrative Agent
to exercise and enforce their rights and remedies hereunder. 

          SECTION
7. No Change in or Disposition of Intercompany Subordinated Debt. The
Subordinated Creditors will not, without the prior written consent of the
Administrative Agent: 

          (a)
sell, assign, transfer, endorse, pledge, encumber or otherwise dispose of any
of the Intercompany Subordinated Debt to any third party other than a wholly
owned Subsidiary of the Borrower that has executed and delivered this
Subordination Agreement; 

          (b)
permit the terms of any of the Intercompany Subordinated Debt to be changed in
such a manner as to have an adverse effect upon the rights or interests of the
Secured Parties or the Administrative Agent; or 

          (c)
upon the occurrence of a Default, take, or permit to be taken, any action to
assert, collect or enforce the Intercompany Subordinated Debt or any part
thereof, except that portion of the Intercompany Subordinated Debt enforced on
behalf of the Secured Parties pursuant to clause (b) of Section 3.

          SECTION
8. Agreement by the Borrower. The Borrower agrees that it will not make
any payment on any of the Intercompany Subordinated Debt, or take any other
action, in contravention of the provisions of this Subordination Agreement. 

          SECTION
9. Obligations Hereunder Not Affected. All rights and interest of the
Secured Parties and the Administrative Agent hereunder, and all agreements and
obligations of the Subordinated Creditors and the Borrower hereunder, shall
remain in full force and effect irrespective of: 

          (a)
any lack of validity or enforceability of any document evidencing Senior
Indebtedness; 

          (b)
any change in the time, manner or place of payment of, or any other term of,
all or any of the Senior Indebtedness, or any other amendment or waiver of or
any consent to departure from any of the documents evidencing or relating to
the Senior Indebtedness; 

          (c)
any exchange, release or non-perfection of any collateral, or any release or
amendment or waiver of or consent to departure from any guaranty or Loan
Document, for all or any of the Senior Indebtedness; 

          (d)
any failure of any Secured Party or the Administrative Agent to assert any
claim or to enforce any right or remedy against any other party hereto under
the provisions of this Subordination Agreement, the Credit Agreement or any
other Loan Document; 

          (e)
any reduction, limitation, impairment or termination of the Senior Indebtedness
for any reason, including any claim of waiver, release, surrender, alteration
or compromise, and shall not be subject to (and the Borrower and each
Subordinated Creditor hereby waive any right to or claim of) any defense (other
than the defense of indefeasible payment in full in cash of the Senior Indebtedness)
or setoff, counterclaim, recoupment or termination whatsoever by reason of
invalidity, illegality, nongenuineness, irregularity, compromise,
unenforceability of, or any other event or occurrence affecting, any Senior
Indebtedness; and 

          (f)
any other circumstance which might otherwise constitute a defense (other than
the defense of indefeasible payment in full in cash of the Senior Indebtedness)
available to, or a discharge of, the Borrower in respect of the Senior
Indebtedness or the Subordinated Creditors in respect of this Subordination
Agreement. 

This
Subordination Agreement shall continue to be effective or be reinstated, as the
case may be, if at any time any payment of any of the Senior Indebtedness is
rescinded or must otherwise be returned by any Secured Party or the
Administrative Agent upon the insolvency, bankruptcy or reorganization of the
Borrower or otherwise, all as though such payment had not been made. The
Subordinated Creditors acknowledge and agree that the Secured Parties and the
Administrative Agent may in accordance with the terms of the Credit Agreement,
without notice or demand and without affecting or impairing the Subordinated
Creditors’ obligations hereunder, from time to time (i) renew, compromise,
extend, increase, accelerate or otherwise change the time for payment of, or
otherwise change the terms of the Senior Indebtedness or any part thereof,
including, without limitation, to increase or decrease the rate of interest
thereon or the principal amount thereof; (ii) take or hold security for the
payment of the Senior Indebtedness and exchange, enforce, foreclose upon, waive
and release any such security; (iii) apply such security and direct the order
or manner of sale thereof as the Administrative Agent and the Secured Parties,
in their sole discretion, may determine; (iv) release and substitute one or
more endorsers, warrantors, borrower or other obligor; and (v) exercise or
refrain from exercising any rights against the Borrower or any other Person. 

          SECTION
10. Representations and Warranties. Each of the Subordinated Creditors
and the Borrower hereby represent and warrant as follows: 

          (a)
no default exists in respect of any such Intercompany Subordinated Debt; 

          (b)
the Subordinated Creditors own the Intercompany Subordinated Debt now
outstanding free and clear of any Lien; 

          (c)
this Subordination Agreement constitutes a legal, valid and binding obligation
of each Subordinated Creditor and the Borrower, enforceable in accordance with
its terms; and 

          (d)
it is in the best interests of each Subordinated Creditor to execute this
Subordination Agreement inasmuch as such Subordinated Creditor will, derive
substantial direct and indirect benefits from the Credit Extensions made from
time to time to the Borrower by the Lenders pursuant to the Credit Agreement
and the execution and delivery of Lender Hedging Agreements and other Loan
Documents between the Borrower and certain Secured Parties, and each
Subordinated Creditor agrees that the Secured Parties are relying on this
representation in agreeing to make Credit Extensions to the Borrower. 

          SECTION
11. Amendments, Waivers. No amendment or waiver of any provision of this
Subordination Agreement, nor any consent or departure by the Subordinated
Creditors or the Borrower herefrom, shall in any event be effective unless the
same shall be in writing and signed by the Administrative Agent, and then such
waiver, amendment, or consent shall be effective only in the specific instance
and for the specific purpose for which given. Any waiver, 

forbearance,
failure or delay by the Administrative Agent or the Secured Parties in
exercising, or the exercise or beginning of exercise by the Administrative
Agent or the Secured Parties of, any right, power or remedy, simultaneous or
later shall not preclude the further, simultaneous or later exercise thereof,
and every right, power or remedy of the Administrative Agent and the Secured
Parties shall continue in full force and effect until such right, power or
remedy is specifically waived in a writing executed or authorized by such
Secured Parties. 

          SECTION
12. Expenses. The Subordinated Creditors and the Borrower jointly and
severally agree to pay, upon demand, to the Administrative Agent or the Secured
Parties, as applicable, any and all reasonable costs and expenses, including,
without limitation, reasonable attorneys’ fees and disbursements which the
Secured Parties or the Administrative Agent may incur in connection with the
administration, exercise or enforcement of any of the rights or interest of the
Secured Parties or the Administrative Agent hereunder. 

          SECTION
13. Address for Notices. All notices and other communications provided
for hereunder shall be in writing and, if to the Subordinated Creditors, mailed
(registered or certified, return receipt requested) or telecopied or hand
delivered at its address set forth below its name on the signature pages
hereto, if to the Borrower, the Administrative Agent or any Secured Party,
mailed (registered or certified, return receipt requested) or hand delivered to
it, addressed to it at the address of the Borrower, the Administrative Agent or
such Secured Party (as the case may be) provided for such Persons pursuant to
the Credit Agreement, or as to each party or other Person at such other address
as shall be designated by such party or Person in a written notice to each
other party complying as to delivery with the terms of this Section. Any
notice, if mailed and properly addressed with postage prepaid or if properly
addressed and sent by pre-paid courier service, shall be deemed given when
received; any notice, if transmitted by facsimile, shall be deemed given when
the confirmation of transmission thereof is received by the transmitter. 

          SECTION
14. Entire Agreement; Severability. This Subordination Agreement
contains the entire agreement among the parties hereto with respect to the
subject matter hereof. If any of the provisions of this Subordination Agreement
shall be held invalid or unenforceable, this Subordination Agreement shall be
construed as if not containing those provisions, and the rights and obligations
of the parties hereto shall be construed and enforced accordingly. 

          SECTION
15. Cumulative Rights. The rights, powers and remedies of the Secured
Parties and the Administrative Agent under this Subordination Agreement shall
be in addition to all rights, powers and remedies given to the Secured Parties
and the Administrative Agent by virtue of any contract, statute or rule of law,
all of which rights, powers and remedies shall be cumulative and may be
exercised successively or concurrently. The parties hereto expressly
acknowledge and agree that the Secured Parties have entered into the Credit
Agreement and will continue to make Credit Extensions from time to time to the
Borrower in reliance on the execution and delivery of this Subordination
Agreement, and the Secured Parties and the Administrative Agent are intended,
and by this reference expressly made, third party beneficiaries of the
provisions of this Subordination Agreement. 

          SECTION
16. Continuing Agreement; Transfer of Notes. This Subordination
Agreement is a continuing agreement of subordination and the Secured Parties may,
from time to

time and
without notice to the Subordinated Creditors, extend credit to or make other
financial arrangements with the Borrower in reliance hereon. This Subordination
Agreement shall (a) remain in full force and effect until the Senior Indebtedness
shall have been indefeasibly paid in cash in full and all Commitments
terminated, (b) be binding upon the Subordinated Creditors, the Borrower and
their respective successors, transferees and assigns, and (c) inure to the
benefit of and be enforceable by the Administrative Agent and each Secured
Party and their respective successors, transferees and assigns. Without
limiting the generality of the foregoing, any Secured Party may, subject to the
provisions of the Credit Agreement, assign or otherwise transfer the Senior
Indebtedness held by it to any other Person, and such other Person shall
thereupon become vested with all the rights in respect thereof granted to such
Secured Party herein or otherwise. 

          SECTION 17. Governing Law. THIS SUBORDINATION
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF
THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK). 

          SECTION
18. Forum Selection and Consent to Jurisdiction. ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER,
OR IN CONNECTION WITH, THESE PROVISIONS, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE ADMINISTRATIVE
AGENT, ANY OTHER SECURED PARTY, THE SUBORDINATED CREDITORS OR THE BORROWER
SHALL BE BROUGHT AND MAINTAINED IN THE COURTS OF THE STATE OF NEW YORK LOCATED
IN NEW YORK COUNTY OR IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK. EACH OF THE BORROWER AND THE SUBORDINATED CREDITORS
HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE COURTS OF
THE STATE OF NEW YORK AND OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET FORTH ABOVE
AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN
CONNECTION WITH SUCH LITIGATION. EACH OF THE SUBORDINATED CREDITORS AND THE
BORROWER FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY REGISTERED
MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF
NEW YORK. EACH OF THE SUBORDINATED CREDITORS AND THE BORROWER HEREBY EXPRESSLY
AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION
WHICH SUCH PERSON MAY HAVE OR HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY
SUCH LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT
ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT
THAT ANY SUBORDINATED CREDITOR OR THE BORROWER HAS OR HEREAFTER MAY ACQUIRE ANY
IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER
THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF
EXECUTION OR OTHERWISE) WITH 

RESPECT TO SUCH PERSON OR THE PROPERTY OF
SUCH PERSON, SUCH SUBORDINATED CREDITOR OR THE BORROWER, AS THE CASE MAY BE,
HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF THE OBLIGATIONS OF SUCH
PERSON UNDER THESE PROVISIONS. 

          SECTION
19. Waiver of Jury Trial. THE
ADMINISTRATIVE AGENT, THE OTHER SECURED PARTIES, THE SUBORDINATED CREDITORS AND
THE BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE TO THE
FULLEST EXTENT PERMITTED BY LAW ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN
RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN
CONNECTION WITH, THESE PROVISIONS, OR ANY COURSE OF CONDUCT, COURSE OF DEALING,
STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE ADMINISTRATIVE AGENT,
ANY SECURED PARTY, THE SUBORDINATED CREDITORS OR THE BORROWER. EACH OF THE SUBORDINATED
CREDITORS AND THE BORROWER ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL
AND SUFFICIENT CONSIDERATION FOR THIS PROVISION (AND EACH OTHER PROVISION OF
EACH OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY) AND THAT THIS PROVISION IS A
MATERIAL INDUCEMENT FOR THE ADMINISTRATIVE AGENT AND THE OTHER SECURED PARTIES
ENTERING INTO THE CREDIT AGREEMENT AND EACH SUCH OTHER LOAN DOCUMENT.

          SECTION
20. Execution in Counterparts. This Subordination Agreement may be
executed by the parties hereto in several counterparts, each of which shall be
deemed to be an original and all of which shall constitute together but one and
the same agreement. Delivery of an executed counterpart of a signature page to
this Subordination Agreement by facsimile shall be effective as delivery of an
original executed counterpart of this Subordination Agreement. 

          IN
WITNESS WHEREOF, the parties have caused this Subordination Agreement to be
duly executed and delivered as of the date first above written. 

	
 

	
 

	
 

	
 

	
HECLA MINING
 COMPANY

	
 

	
 

	
 

	
 

	
By:

	
 

	
 

	
 

	 

	
 

	
 

	
Title:

	
 

	
 

	
 

	
 

	
 

	
[SUBORDINATED
 CREDITORS]

	
 

	
 

	
 

	
 

	
 

	
By: 

	
 

	
 

	
 

	
 

	 

	
 

	
 

	
Title:

	
 

	
 

	
 

	
 

	
 

	
Address:

	
 

	
 

	
 

	 

	
 

	
 

	
 

	
 

	 

	
 

	
 

	
 

	
 

	 

	
 

	
 

	
 

	
 

	
 

	
Facsimile
 No.:

	
 

	
 

	
 

	
Attention:

	
 

	
 

	
 

	
 

	
Acknowledged
 by:

	
 

	
 

	
 

	
 

	
THE BANK OF
 NOVA SCOTIA,

	
 

	
as
 the Administrative Agent

	
 

	
 

	
 

	
 

	
By:

	
 

	
 

	
 

	 

	
 

	
 

	
Title:

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00140-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00140-of-00352.parquet"}]]